UNITED STATES

 SECURITIES AND EXCHANGE COMMISSION

 Washington, D.C. 20549

 FORM 10-K

 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the fiscal year ended December 31, 2024

 or

 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the transition period from _____ to _____

 Commission File Number 000-51371

 LINCOLN EDUCATIONAL SERVICES CORP ORATION

 (Exact name of registrant as specified in its charter)

 New Jersey

 57-1150621

 (State or other jurisdiction of incorporation or organization)

 (IRS Employer Identification No.)

 14 Sylvan Way, Suite A

 Parsippany, NJ 07054

 (Address of principal executive offices)

 ( 973) 736-9340

 (Registrant's telephone number, including area code)

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

 Title of each class

 Trading Symbol (s)

 Name of exchange on which registered

 Common Stock, no par value per share

 LINC

 The NASDAQ
 Stock Market LLC

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

 None

 Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

 Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No

 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

 Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule
 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No

 Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or emerging growth
 company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 Large accelerated filer

 Accelerated filer

 Non-accelerated filer

 Smaller reporting company

 Emerging growth company

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

 Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal
 control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

 If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in
 the filing reflect the correction of an error to previously filed financial statements.

 Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
 received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).

 Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No

 The aggregate market value of the 25,958,682 shares of Common Stock held by non-affiliates of the registrant issued and outstanding as of June 30, 2024, the last business day of the registrant's
 most recently completed second fiscal quarter, was $ 307,869,969. This amount is based on the closing price of the Common Stock on the
 Nasdaq Global Select Market of $ 11.86
 per share on that date. Shares of Common Stock held by executive officers, directors and 10% or greater stockholders have been excluded since such persons may be deemed affiliates. This determination of affiliate status is not a determination for any other
 purpose.

 The number of shares of the registrant's Common Stock outstanding as of March 3, 2025 was 31,592,807.

 Documents Incorporated by Reference

 Certain information required in Part III of this Annual Report on Form 10-K will be included in a definitive proxy statement for the registrant's annual meeting of shareholders or an
 amendment to this Annual Report on Form 10-K, in either case filed with the Commission within 120 days after December 31, 2024, and is incorporated by reference herein.

 INDEX TO FORM 10-K

 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2024

 PART I.

 ITEM 1.

 BUSINESS

 ITEM 1A.

 RISK FACTORS

 ITEM 1B.

 UNRESOLVED STAFF COMMENTS

 ITEM 1C.

 CYBERSECURITY

 ITEM 2.

 PROPERTIES

 ITEM 3.

 LEGAL PROCEEDINGS

 ITEM 4.

 MINE SAFETY DISCLOSURES

 PART II.

 ITEM 5.

 MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 ITEM 6.

 [RESERVED]

 ITEM 7.

 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 ITEM 7A.

 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 ITEM 8

 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 ITEM 9.

 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 ITEM 9A.

 CONTROLS AND PROCEDURES

 ITEM 9B.

 OTHER INFORMATION

 ITEM 9C.

 DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

 PART III.

 ITEM 10.

 DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 ITEM 11.

 EXECUTIVE COMPENSATION

 ITEM 12.

 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 ITEM 13.

 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

 ITEM 14.

 PRINCIPAL ACCOUNTANT FEES AND SERVICES

 PART IV.

 ITEM 15.

 EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

 ITEM 16.

 FORM 10-K SUMMARY

 SIGNATURES

 Cautionary Note Regarding Forward-Looking Statements

 This Annual Report on Form 10-K and the documents incorporated by reference contain "forward-looking statements," within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended,
 which include information relating to future events, future financial performance, strategies, expectations, competitive environment, regulation and availability of resources. These forward-looking statements include, without limitation,
 statements regarding: proposed new programs; expectations that regulatory developments or other matters will or will not have a material adverse effect on our consolidated financial position, results of operations or liquidity; statements
 concerning projections, predictions, expectations, estimates or forecasts as to our business, financial and operating results and future economic performance; and statements of management's goals and objectives and other similar expressions
 concerning matters that are not historical facts. Words such as "may," "should," "could," "would," "predicts," "potential," "continue," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," and similar expressions, as
 well as statements in future tense, identify forward-looking statements.

 Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or
 results will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management's good faith belief as of that time with respect to future events, and are subject to risks and
 uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:

 •

 compliance with the extensive existing regulatory framework applicable to our industry or our failure to timely obtain and maintain regulatory approvals and accreditation;

 •

 compliance with continuous changes in applicable federal laws and regulations including pending rulemaking by the U.S. Department of Education;

 •

 the effect of current and future Title IV Program regulations arising out of negotiated rulemakings, including any potential reductions in funding or restrictions on the use of funds received through Title
 IV Programs;

 •

 successful updating and expansion of the content of existing programs and developing new programs in a cost-effective manner or on a timely basis;

 •

 uncertainties regarding our ability to comply with federal laws and regulations regarding the 90/10 Rule and cohort default rates;

 •

 successful implementation of our strategic plan;

 •

 our inability to maintain eligibility for or to process federal student financial assistance;

 •

 regulatory investigations of, or actions commenced against, us or other companies in our industry;

 •

 changes in the state regulatory environment or budgetary constraints;

 •

 enrollment declines;

 •

 challenges in our students' ability to find employment as a result of economic conditions;

 •

 maintenance and expansion of existing industry relationships and develop new industry relationships;

 •

 a loss of members of our senior management or other key employees;

 •

 uncertainties associated with opening of new campuses and closing existing campuses;

 •

 uncertainties associated with integration of acquired schools;

 •

 industry competition;

 •

 the effect of any cybersecurity incident;

 •

 the effect of public health outbreaks, epidemics and pandemics;

 •

 conditions and trends in our industry;

 •

 general economic conditions; and

 •

 other factors discussed under the headings "Business," "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations."

 Forward-looking statements speak only as of the date the statements are made. Except as required under the federal securities laws and rules and regulations of the United States Securities and Exchange Commission,
 we undertake no obligation to update or revise forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. We caution you not to unduly rely on the
 forward-looking statements when evaluating the information presented herein.

 PART I.

 ITEM 1.

 BUSINESS

 Overview

 Lincoln Educational Services Corporation and its subsidiaries (collectively, the
 "Company", "we", "our" and "us", as applicable) provide diversified career-oriented postsecondary education to recent high school graduates and working adults. The Company, which currently operates 21 campuses in 12 states, has entered into
 leases for two new campuses: one in Houston, Texas, with programs expected to begin in the second half of 2025, and one in Hicksville, New York, with programs expected to begin by the end of 2026. Lincoln Educational Services Corporation offers

 programs in skilled trades (which include Heating Ventilation and Air Conditioning ("HVAC"), welding and computerized numerical control and electrical and electronic systems technology, among other programs), automotive technology, healthcare
 services (which include nursing, dental assistant and medical assistant, among other programs) and hospitality services and information technology (which include culinary and aesthetics and information technology programs). The schools operate
 under the brands Lincoln Technical Institute, Lincoln College of Technology and Nashville Auto Diesel College.

 Most of the Company's 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 accredited and are eligible to participate in federal financial aid programs
 administered 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. The
 Company was incorporated in New Jersey in 2003 as the successor-in-interest to various acquired schools including Lincoln Technical Institute, Inc. which opened its first campus in Newark, New Jersey in 1946.

 The Company manages its business, evaluates performance and allocates resources based on two reportable business segments, Campus Operations and Transitional:

 Campus Operations - The Campus Operations segment includes campuses that are continuing in operation and contribute to the Company's core operations and performance. All of the campuses
 continuing in operation are classified in this segment. The majority of the campuses offer programs across various areas of study.

 Transitional – The Transitional segment
 refers to campuses that are marked for closure and are currently being taught-out, in addition to campuses that are held-for-sale or sold. As of December 31, 2024, the net assets for the Summerlin, Las Vegas campus were classified as held for
 sale, with operating results classified within the Transitional segment. The sale of the campus was consummated effective January 1, 2025. In addition, the Company closed the Somerville, Massachusetts campus in the prior year. It was fully
 taught-out as of December 31, 2023. This campus is classified in the Transitional segment in the prior year's statement of operations.

 As of December 31, 2024, we had 15,138 students enrolled at 21 campuses. Our average enrollment for the fiscal year ended December 31, 2024 was 14,426 students and our revenues were $440.1 million, which
 represented an increase of 16.4% over the prior fiscal year. For more information relating to our revenues, profits and financial condition, please refer to our Consolidated Financial Statements included in this Annual Report on Form 10-K.

 We believe that we provide our students with the highest quality career-oriented training available for our areas of study in our markets thereby serving students, local employers and their communities. The

 skills gap continues to expand as talent retires faster than new employees are hired and as the need for education and training increases in all careers with the accelerating pace of technological change.

 We offer programs in areas of study that we believe are typically underserved by traditional providers of postsecondary education and for which we believe there exists significant demand among students and
 employers. Furthermore, we believe our convenient class scheduling, career-focused curricula and emphasis on job placement offer our students valuable advantages that have been previously unaddressed by the traditional academic sector. By
 combining virtual training with traditional classroom-based training led by experienced instructors, we believe we offer our students a unique opportunity to develop practical job skills in many of the key areas of expected job demand. We believe
 these job skills enable our students to compete effectively for employment opportunities and to pursue salary and career advancement.

 In the last several years, we have further implemented our plan of improving the student experience by adding program offerings, enhancing existing program offerings and expanding geographically with new state of the art campuses. See Part II. Item 8. "Financial Statements and Supplemental Data - Notes to Consolidated Financial Statements – Note 6 Leases and Note 8 Real Estate Transactions."

 Business Strategy

 We strive to strengthen our position as a leading provider of career oriented postsecondary education by continuing to pursue the following strategy:

 •

 Increase Operating Efficiency. Our existing schools are a result of strategic acquisitions and expansion, and, while the programs may be very similar
 across the campuses, each campus operates on its own calendar. As we move most of our curriculum to a hybrid teaching model of virtual and traditional classroom-based in-person training, we are taking this opportunity to also standardize
 the programs and course calendars so that new students will begin on the same day across all campuses. In addition, we are removing certain functions from the campuses and centralizing them to remove distractions from the campuses while
 creating more efficient and effective services for our students. By simplifying, centralizing and standardizing our operations, we believe we will improve our margins and be more scalable. We are continuously evaluating our processes and
 implementing new technologies to increase efficiency across the organization.

 •

 Replicate Programs and Expand Existing Areas of Study. Whenever possible, we seek to replicate programs across our campuses. Adding proven in-demand
 programs to an existing campus enables that campus to further serve that market while increasing the operating efficiency at that campus. In addition, we believe we can leverage our operations to expand our program offerings in existing
 areas of study.

 •

 Maximize Utilization of Existing Facilities. We are focused on improving capacity utilization of existing facilities through increased enrollments,
 the introduction of new programs and relationships with companies in the industry. In addition, we see opportunities to adjust our real estate needs with the advancement of our hybrid teaching model.

 •

 Expand Geographically. We plan to deploy our resources to strengthen our brand, invest in new programs and seek opportunities to expand our footprint
 into new markets. We have a solid portfolio of corporate entities requesting that we explore new geographies to serve them better. Regardless of whether we expand our current campuses to take advantage of the operating leverage or
 establish new campuses, our goal is to remain competitive and prudently deploy our resources. Our expansion plans may be achieved organically through the opening of new campuses with existing resources or through acquisitions. We opened
 our first new campus in over a decade in the Atlanta market in the first half of 2024, and we have signed leases for a new campus in Houston, Texas that we expect to open in the second half of 2025 and for a new campus in Hicksville, New
 York that we expect will open by the end of 2026.

 •

 Expand Teaching Platform. Using the lessons learned from the COVID-19 pandemic, we expect to continue to transform our
 in-person education model to a hybrid teaching model, which we call Lincoln 10.0. The Lincoln 10.0 model provides students with greater flexibility and convenience, which should help us attract more students. Moreover, we believe
 blended learning will create operating efficiencies that will enable us to contain tuition increases over the coming years and thus provide our students with a higher return on investment in their education in addition to the increased
 flexibility and convenience. As of December 31, 2024, we have transitioned all of our major programs to the hybrid model, except for our licensed practical nursing program, which we expect will commence transitioning to the hybrid model
 in 2026.

 Programs and Areas of Study

 We structure our program offerings to provide our students with a practical, career-oriented education and position them for attractive entry-level job opportunities in their chosen fields. Our diploma/certificate
 programs typically take between 27 to 104 weeks to complete, with tuition ranging from $14,500 to $42,000. Our associate degree programs typically take between 69 to 94 weeks to complete, with tuition ranging from $31,000 to $42,000. As of
 December 31, 2024, all of our schools offer diploma and certificate programs and ten of our schools are currently approved to offer associate degree programs. In order to accommodate the schedules of our students and maximize classroom
 utilization at some of our campuses, we typically offer courses four to five days a week in three shifts per day and start new classes every month. We update and expand our programs frequently to reflect the latest technological advances in the
 field, providing our students with the specific skills and knowledge required in the current marketplace. Classroom instruction combines lectures and demonstrations by our experienced faculty with comprehensive hands-on laboratory exercises in
 simulated workplace environments.

 The following table lists the programs offered as of December 31, 2024:

 Current Programs Offered

 Area of Study

 Associate's Degree

 Diploma and Certificate

 Skilled Trades

 Electrical and Electronic Systems Technology Service Management, HVAC

 Electrical & Electronics Systems Technology, Electrician Training, HVAC, Welding Technology, Welding Fabrication Technology, Welding and Metal Fabrication Technology, Welding with Introduction to
 Pipefitting, CNC Machining and Manufacturing, Advanced Manufacturing with Robotics

 Automotive

 Automotive Service Management, Collision Repair & Refinishing Service Management, Diesel & Truck Service Management, Heavy Equipment Maintenance Service Management

 Automotive Technology, Automotive Technology with BMW, Automotive Technology with Mopar X-Press, Automotive Technology with Volkswagen, Collision Repair and Refinishing Technology, Diesel & Truck
 Technology, Diesel & Truck Technology with Alternate Fuel Technology, Diesel & Truck Technology with Transport Refrigeration, Heavy Equipment Service Technology

 Health Sciences & Information Technology

 Medical Assisting Technology

 Medical Assistant, Patient Care Technician, Dental Assistant, Licensed Practical Nursing, Computer Systems Support Technician

 Skilled Trades. For the year ended December 31, 2024, skilled trades were our largest area of study, representing 45% of our total average student
 enrollment. Our skilled trades programs are 32 to 81 weeks in length, with tuition rates ranging from $21,000 to $36,000. Our skilled trades programs include electrical, heating and air conditioning repair, welding, computerized numerical
 control and electronic and electronic systems technology. Graduates of our programs are qualified to obtain entry-level employment positions such as electrician, CNC machinist, cable installer, welder, wiring and heating, ventilating and air
 conditioning, or HVAC installer. Our graduates are employed by a wide variety of employers, including residential and commercial construction, telecommunications installation companies and architectural firms. As of December 31, 2024, we offered
 skilled trades programs at 17 campuses.

 Automotive Technology. Automotive technology is our second largest area of study, with 29% of our total average student enrollment for the year ended
 December 31, 2024. Our automotive technology programs are 52 to 98 weeks in length, with tuition rates ranging from $27,000 to $42,000. We believe we are a leading provider of automotive technology education in each of our local markets.
 Graduates of our programs are qualified to obtain entry-level employment ranging from positions as technicians and mechanics to various apprentice level positions. Our graduates are employed by a wide variety of companies, ranging from automotive
 and diesel dealers, to independent auto body paint and repair shops to trucking and construction companies. As of December 31, 2024, we offered programs in automotive technology at 13 campuses. Our campuses in East Windsor, Connecticut;
 Nashville, Tennessee; Grand Prairie, Texas; Indianapolis, Indiana; and Denver, Colorado are destination campuses, attracting students throughout the United States and, in some cases, from abroad.

 Health Sciences & Information Technology.

 For the year ended December 31, 2024, 26% of our total average student enrollment was in our health science & information technology programs. Our health science & information technology programs are 27 to 104 weeks in length, with
 tuition rates ranging from $15,000 to $33,000. Our health sciences graduates are employed by a wide variety of employers, including hospitals, laboratories, insurance companies, and doctors' offices. Our IT graduates obtain entry-level positions
 with both small and large corporations. As of December 31, 2024, we offered health science programs at 12 of our campuses and IT programs at four campuses.

 Marketing and Student Recruitment

 We utilize a variety of marketing and recruiting methods to attract students and increase enrollment. Our marketing and recruiting efforts are targeted at prospective students who are high school graduates entering the
 workforce, or who are currently underemployed or unemployed and require additional training to enter or re-enter the workforce.

 Marketing and Advertising. We utilize a fully integrated marketing approach in our lead generation and admissions process that includes
 the use of traditional media such as television, radio, billboards, direct mail, a variety of print media and event marketing campaigns intended to raise brand awareness. In addition, we continually grow and enhance our digital
 marketing efforts, which include paid search, paid and organic social media, search engine optimization, online video and display advertising and pay-per-lead channels. These digital channels currently drive the majority of our new student leads
 and enrollments. Our fully integrated marketing campaigns direct prospective students to contact us directly or visit our website or other customized landing pages on the internet where they will find details regarding our programs and campuses
 and can request additional information regarding the programs that interest them. Prospective students may also apply for admission online. Our internal systems enable us to closely monitor and track the effectiveness of each marketing execution
 on a daily or weekly basis and make adjustments accordingly to enhance our efficiency and limit our student acquisition
 costs.

 Referrals. Referrals from current students, high school counselors and satisfied graduates and their employers have
 historically represented approximately 11.0% of our new student starts. Our school administrators actively work with our current students to encourage them to recommend our programs to prospective students. We endeavor to build and retain strong
 relationships with high school guidance counselors and instructors by offering annual seminars at our training facilities to further familiarize these individuals on the strengths of our programs.

 Recruiting. Our recruiting efforts are conducted by a group of approximately 278 campus-based and field representatives who meet directly with prospective
 students during presentations conducted at high schools, in the prospective students' homes or during their visit to one of our campuses. We also recruit adult career-seekers or career-changers through our campus-based representatives.

 During the fiscal year ended December 31, 2024, we recruited approximately 21% of our students directly out of high school. Field sales continue to be a large part of our business and developing local community
 relationships is one of our most important recruiting functions.

 Student Admissions, Enrollment and Retention

 Admissions. To attend our schools, students must have either a high school diploma or a high school equivalency certificate (or General Education
 Development Certificate, GED). In addition, students must complete both an admissions interview and learner assessment. We take admissions requirements very seriously as they are the best indicators of our students' likelihood for program success
 and completion, leading to successful employment in their chosen industry. The learner assessment is a questionnaire designed to discover challenges and help us to address them prior to the student attending. While each of our programs has
 different admissions criteria, we screen all applications and counsel prospective students on the most appropriate program to increase the likelihood that they complete the requisite coursework and obtain and sustain employment following
 graduation.

 Enrollment. We enroll students continuously throughout the year, with our largest classes enrolling in late summer or early fall following high school
 graduation. As of December 31, 2024, we had 15,138 students enrolled at 21 campuses and our average enrollment during the fiscal year ended December 31, 2024 was 14,426 students.

 Retention. To maximize student retention, the staff at each school is trained to recognize the early warning signs of a potential drop and to assist and
 advise students on academic, financial and employment matters. We monitor our retention rates by instructor, course, program, and campus. When we become aware that a particular instructor or program is experiencing a higher-than-normal dropout
 rate, we quickly seek to determine the cause of the problem and attempt to correct it. When we identify that a student is having trouble academically, we offer tutoring. As we moved to online delivery of instruction, we saw a slight decline in
 our student retention rate, but we believe this is temporary and will improve as our faculty becomes better skilled at hybrid teaching. To ensure that this happens, we have developed online teacher training for all faculty.

 Job Placement

 We believe that assisting our graduates in securing employment after completing their program of study is critical to our mission as a postsecondary educational institution as well as to our ability to attract high
 quality students and enhance our reputation in the industry. In addition, we believe that high job placement rates result in low student loan default rates, an important requirement for continued participation in Title IV of the Higher Education
 Act of 1965, as amended ("Title IV Programs"). See Part I, Item 1. "Business - Regulatory Environment—Regulation of Federal Student Financial Aid Programs." Accordingly, we dedicate significant resources to maintaining an effective graduate
 placement program. Our non-destination schools work closely with local employers to ensure that we are training students with skills that local employers seek. Each school has an advisory council comprised of local employers who provide us with
 direct feedback on how well we are preparing our students to succeed in the workplace. This enables us to tailor our programs to the marketplace. The placement staff in each of our destination schools maintains databases of potential employers
 throughout the country, allowing us to more effectively assist our graduates in securing employment in their career fields upon graduation. Throughout each year, we hold numerous job fairs at our facilities where we provide the opportunity for
 our students to meet and interact with potential employers. We also assist students with resume writing, interviewing and other job search skills.

 In addition, many of our schools have internship programs that provide our students with opportunities to work with potential employers prior to
 graduation. For example, some of the students in our automotive programs have the opportunity to complete a portion of their hands-on training in an actual work environment. Also, some of our students in health sciences programs are required to
 participate in an externship program in which they work in the field as part of their career training. Further, we have formed industry relationships with several Fortune 500 companies to assist them with their hiring needs. We provide these
 companies with various services including providing graduating student candidates for interviews and providing company-specific training to selected individuals that accelerates their on-boarding. These industry relationships not only provide
 our students with career opportunities which may include signing bonuses and tuition assistance plans, but also benefit Lincoln by sometimes providing equipment donations, scholarships and advice that enables us to design our curricula to
 better meet industry needs.

 Human Capital Management

 Overview

 We believe that each of our employees plays an important role in our enterprise. This is particularly true of our faculty. We are focused on attracting and retaining the highly qualified personnel needed to support
 our objectives of providing superior education in the programs that our schools provide.

 As of December 31, 2024, we had approximately 2,475 employees, including approximately 600 full-time instructors and approximately 450 part-time instructors, and approximately 1,425 employees serving in
 various administrative and management positions. We had no seasonal workers. The number of individuals comprising our workforce increased by approximately 8.0% in the most recently completed fiscal year.

 Staffing Our Schools

 Our schools typically are staffed by a school president, a director of career services, a director of education, a director of administrative services, a director of admissions and a variety of instructors, all of whom
 are industry professionals with experience in the areas of study at that particular school.

 Our average student to teacher ratio was approximately 16.5 to 1 during the fiscal year ended December 31, 2024.

 Equal Opportunity

 We strive to create a culture of opportunity and excellence through our human capital management practices. Our recruitment practices and outreach efforts are designed to maximize the applicant pool to ensure that we
 are able to hire the most qualified individuals in the market. The varied perspectives and experiences of our personnel enhance our work. In accordance with our obligations to provide a discrimination-free and harassment-free workplace, we
 work hard to ensure equal opportunity in hiring, promotions, training and development, working conditions and compensation. In addition, the Company has adopted a Human Rights Policy that reflects, among other things, our commitment to
 anti-discrimination in hiring and otherwise.

 Development, Training and Retention

 The Company employs staff to attract and engage talent and applies fully integrated recruiting software to track and manage hiring processes for our campuses and corporate functions. We hire our faculty in accordance
 with established criteria, including relevant work experience, educational background and accreditation and state regulatory standards. We require meaningful industry experience of our teaching staff to maintain the high quality of instruction in
 all of our programs that we expect and to address current and industry-specific issues in our course content. In addition, we provide intensive instructional training and continuing education, including quarterly instructional development
 seminars, annual reviews, technical upgrade training, faculty development plans and weekly staff meetings.

 The Company acknowledges the importance of managing productivity and efficiency of its workforce. The Company uses current technology resources for sales and student services tasks, education support, graduate
 placement services, and internal talent management. Through the application of these technology tools, productivity data is obtained for key positions and used for process improvement, training, and evaluative purposes.

 The Company recognizes the value to both the Company and our students of employee knowledge and skill development throughout their careers and of preparing current employees for succession opportunities. Therefore,
 employees receive position-based training, as well as online access to a multitude of programs designed to support their effectiveness and growth potential. The Company identifies high-performing employee participants for acceleration training
 programs to develop internal candidates for succession opportunities in key functions.

 Labor Relations

 We believe that we have good relationships with all of our employees. At seven of our 21 campuses, the teaching professionals are represented by various unions. In
 2024, the faculty at one of our campuses voted to be represented through collective bargaining. Approximately 230 employees are now covered by collective bargaining agreements that expire between 2025 and 2027. Those agreements expiring in the
 short term, as well as the agreement for the additional campus, are in the process of negotiation. We believe that we have good relationships with these unions and
 with the employees covered by these collective bargaining agreements and do not foresee issues with entering into satisfactory new agreements.

 Our Management

 We believe that our management team has the experience necessary to effectively implement our growth strategy and continue to drive positive educational and employment outcomes for our students. For a discussion of the
 risks relating to the attraction and retention of management and executive management employees, see Item 1A. "Risk Factors."

 Competition

 The for-profit, postsecondary education industry is highly competitive and highly fragmented with no one provider controlling significant market share. Direct competition between career-oriented schools like ours and
 traditional four-year colleges or universities is limited. Thus, our main competitors are other for-profit, career-oriented schools, not-for-profit public schools and private schools, and public and private two-year junior and community colleges,
 most of which are eligible to receive funding under the federal programs of student financial aid authorized by Title IV Programs. Competition is generally based on location, the type of programs offered, the quality of instruction, placement
 rates, reputation, recruiting and tuition rates; therefore, our competition is different in each market depending on, among other things, the availability of other options. Public institutions are generally able to charge lower tuition than our
 schools, due in part to government subsidies and other financial sources not available to for-profit schools. In addition, some of our other competitors have a more extensive network of schools and campuses, which enables them to recruit students
 more efficiently from a wider geographic area. Nevertheless, we believe that we are able to compete effectively in our local markets because of the diversity of our program offerings, quality of instruction, the strength of our brands, our
 reputation and our graduates' success in securing employment after completing their programs of study.

 Our competition differs in each market depending on the curriculum that we offer. For example, a school offering automotive technology, healthcare services and skilled trades programs will have a different group of
 competitors than a school offering healthcare services and IT technology programs. Also, because schools can add new programs within six to 12 months, competition can emerge relatively quickly. Moreover, with online education becoming more
 prevalent, the number of competitors in each market has increased because students can now attend classes from an online institution. On average, each of our schools has at least three direct competitors and at least a dozen indirect competitors.

 Environmental Matters

 We use limited amounts of hazardous materials at our training facilities and campuses, and generate small quantities of regulated waste such as used oil, antifreeze, paint and car batteries. As a result, our facilities
 and operations are subject to a variety of environmental laws and regulations governing, among other things, the use, storage and disposal of solid and hazardous substances and waste, and the clean-up of contamination at our facilities or
 off-site locations to which we send or have sent waste for disposal. We are also required to obtain permits for our air emissions and to meet operational and maintenance requirements at certain of our campuses. In the event we do not maintain
 compliance with any of these laws and regulations, or are responsible for a spill or release of hazardous materials, we could incur significant costs for cleanup or damages and fines or penalties.

 We are committed to sustainability, conserving energy and limiting waste and regularly review our impact on the environment with a view to improvement. In addition, we have adopted an Environmental Policy reflecting our
 commitment in this regard.

 Regulatory Environment

 The education industry is highly regulated by a wide range of federal and state agencies as well as institutional and programmatic accrediting agencies including the U.S. Department of Education ("DOE"). The vast
 regulatory schemes to which our industry is subject cover a significant portion of our operations such as our programs, instructional staff, administrative procedures, marketing and recruiting efforts, third-party servicers, private loan
 programs, and facilities, among other things. The various regulatory bodies with oversight over our business periodically issue new requirements, revise existing requirements, and modify their interpretations of existing requirements. These
 regulatory requirements also impact our ability to acquire or open new campuses, change our existing programs and institute new programs.

 We also are subject to oversight by other federal agencies including the Consumer Financial Protection Bureau ("CFPB"), the Federal Trade Commission ("FTC"), and the Departments of Veterans Affairs ("VA") and Defense
 ("DOD"). We cannot predict how any of the regulatory requirements to which we are subject will be applied or whether each of our schools will be able to comply with such requirements in the future.

 The various approvals granted by the regulatory entities to which we are subject are what collectively allow our schools to operate and to participate in a variety of government-sponsored financial aid programs
 that assist students in paying for their education, the most significant of which are the federal student aid programs administered by the DOE under the Higher Education Act of 1965, as amended (the "HEA"). See Part I, Item 1. "Business -
 Regulatory Environment – State Authorization," "Regulatory Environment – Accreditation," "Regulatory Environment – Regulation of Federal Student Financial Aid Programs," and "Regulatory Environment – Other Financial Assistance Programs." The
 HEA and the regulations of the DOE specify extensive criteria and numerous standards that we must satisfy in order to participate in federal financial aid programs under Title IV of the HEA ("Title IV Programs"). Generally, to participate in
 Title IV Programs, an institution must be licensed or otherwise legally authorized to operate in the state where it is physically located, be accredited by an accreditor recognized by the DOE, be certified as an eligible institution by the DOE,
 offer at least one eligible program of education, and comply with other statutory and regulatory requirements. Students seeking financial aid under Title IV Programs obtain access to federal student financial aid through a DOE-prescribed
 application and eligibility certification. Each of our schools currently participates in Title IV Programs. For the fiscal year ended December 31, 2024, approximately 82.0% (calculated based on cash
 receipts) of our revenues were derived from Title IV Programs. Congress periodically revises the HEA and other laws governing Title IV Programs and annually determines the funding level for each Title IV Program. Further, the President could
 issue executive orders or take other actions and the DOE could establish new regulations that could make it more difficult for our schools to operate and comply with applicable regulations.

 Also, all of our schools are currently offering both online and in-person learning. Accrediting agencies and some state bodies require schools to obtain approval and meet certain requirements in order to offer programs
 via distance education in states where the school does not have a campus. The DOE also generally requires schools that offer a program through distance education to students in a state in which the school is not physically located to meet the
 requirements of the state in order to offer programs by distance education in the state. All of our schools are currently approved to offer both distance and in-person learning by the DOE, ACCSC, and the states in which they are physically
 located. In addition, our Indianapolis school is an institutional participant in the National Council for State Authorization Reciprocity Agreement ("NC-SARA") which is a voluntary agreement among member states which enables participating
 schools who are authorized by the state in which they are physically located to offer distance education in other participating states without obtaining additional authorization in those states.

 State Authorization

 To operate and offer postsecondary educational programs and to be certified to participate in Title IV Programs, each of our schools must be authorized and maintain authorization from the state in which it is
 physically located. Further, in order for a school to engage in educational or recruiting activities outside of its state of physical location, the school also may be required to obtain and maintain authorization from the states in which it is
 recruiting students or in which its students are receiving online instruction. The level of regulatory oversight varies substantially from state to state and is extensive in some states. State laws may establish standards for instruction,
 qualifications of faculty, location and nature of facilities and equipment, administrative procedures, marketing, recruiting, student outcomes reporting, disclosure obligations to students, limitations on mandatory arbitration clauses in
 enrollment agreements, requirements for distance learning including online and blended courses, financial operations, and other operational matters. Some states prescribe standards of financial responsibility and mandate that institutions post
 surety bonds. We have posted surety bonds on behalf of our schools and education representatives with multiple states in an aggregate amount of approximately $17.0 million. Currently, each of our schools is authorized by the applicable state education agencies to offer distance and in-person learning in the states in which the school is physically located and is authorized to recruit students in
 the states in which it recruits students. Our Indianapolis school also is an institutional participant in NC-SARA which enables it to offer distance learning to students located in other states. Our other schools have entered into a consortium
 agreement with our Indianapolis school that has been approved by ACCSC and applicable state education agencies and that enables students enrolled in one of the other schools to take courses online through the Indianapolis school.

 Some of our educational programs prepare students for occupations that require professional licensure in order to work in the occupation. These programs are subject to the requirements of state occupational agencies
 that require our schools that offer the programs to obtain agency approval of the programs and to comply with the applicable requirements of these boards. For example, each of our schools that offers a nursing program is required to obtain and
 periodically renew approvals from the applicable occupational agencies that regulate these programs in the state in which the schools are physically located. If we fail to maintain our approvals or comply with applicable requirements, we could
 lose our authority to offer the impacted programs and could be subject to other sanctions.

 The practical nursing program offered at three of our campuses in New Jersey also is subject to the requirements of the New Jersey Board of Nursing ("NJBON"), a state occupational agency. Among the various
 requirements applicable to the practical nursing program is the requirement that at least 75% of the program's graduates pass the state licensure examination on their first attempt. On July 12, 2024, the NJBON placed our Paramus, New Jersey
 campus (the "Paramus campus") practical nursing program on probation because, for three consecutive calendar years, less than 75% of the program's graduates passed the state licensure examination on their first attempt. The program also is
 offered at the Company's other campuses in Iselin and Moorestown, New Jersey where the licensure pass rate requirement has been successfully achieved by the graduates of the program at these campuses.

 As a result of the probationary status of the Paramus campus program, the Paramus campus was required to submit to the NJBON an 18-month action plan demonstrating its plan for improving the licensure pass rate to at
 least 75% in the next calendar year (or within an extension period if granted by the NJBON). Furthermore, during this probationary period, the NJBON will not allow the Paramus campus to enroll any new students or accept any transfer students
 in its practical nursing program. If the program does not achieve the required licensure pass rate within one calendar year (or within an extension period if granted by the NJBON), the NJBON rules indicate that the program would not be
 eligible for restoration to accredited status and, therefore, would lose accreditation permanently for this program.

 While the loss of the ability to enroll new students or accept transfer students during the probationary period, or the ultimate loss of accreditation for the practical nursing program at the Paramus campus (should
 that occur), would not be expected to be material to the Company, it could have a negative reputational impact and have an adverse financial impact on the Paramus campus if we are unable to enroll more students in other existing programs at the
 Paramus campus and/or to add other programs at this campus. We would expect that the loss in practical nursing students at this location would be offset, at least in part, by increased enrollments at our Iselin and Moorestown, New Jersey
 campuses.

 In general, if any of our schools fail to comply with state licensing requirements, they may be subject to the loss of state licensure or authorization. If any one of our schools lost its authorization from the
 education agency of the state in which the school is located, or failed to comply with the DOE's state authorization requirements, that school would lose its eligibility to participate in Title IV Programs, the Title IV Program eligibility of its
 related additional locations could be affected, the impacted schools would be unable to offer its programs, and we could be forced to close the schools. If one of our schools lost its state authorization from a state other than the state in which
 the school is located, the school would not be able to recruit students or to operate in that state.

 Accreditation

 Accreditation is a non-governmental process through which a school submits to ongoing qualitative and quantitative review by an organization of peer institutions. Accrediting agencies primarily examine the academic
 quality of the school's instructional programs, and a grant of accreditation is generally viewed as confirmation that the school's programs meet generally accepted academic standards. Accrediting agencies also review the administrative and
 financial operations of the schools they accredit to ensure that each school has the resources necessary to perform its educational mission.

 Accreditation by an accrediting agency recognized by the DOE is required for an institution to be certified to participate in Title IV Programs. In order to be recognized by the DOE, accrediting agencies must adopt
 specific standards for their review of educational institutions. As of December 31, 2024, 21 of our campuses are institutionally accredited by the Accrediting Commission of Career Schools and Colleges (the "ACCSC") which is recognized by the DOE.

 If the DOE withdraws the recognition of an accrediting agency, the HEA indicates that the DOE may continue the eligibility of qualified institutions accredited by the accrediting agency for a period of up to 18 months from the date of the
 withdrawal of the DOE's recognition of the accrediting agency. If provided, this period would allow time for institutions to apply for accreditation from another DOE-recognized accrediting body. The DOE could impose provisional certification
 status and other conditions and restrictions on such institutions during this time period. If the DOE declines to continue its recognition of ACCSC and if the subsequent period for obtaining accreditation from another DOE-recognized accrediting
 agency lapses before we obtain accreditation from another DOE-recognized accrediting agency (or if the DOE does not provide such a period for institutions to obtain other accreditation), our schools could lose Title IV eligibility. On May 25, 2023, the DOE notified ACCSC that it would continue the DOE's recognition of the agency as a nationally recognized accreditor for three years.

 The following is a list of the dates on which each campus was accredited by its accrediting commission and the date by which its accreditation must be renewed.

 Accrediting Commission of Career Schools and Colleges Reaccreditation Dates

 School

 Last Accreditation Letter

 Next Accreditation

 Philadelphia, PA 2

 September 1, 2023

 May 1, 2028

 Union, NJ 1

 August 14, 2024

 February 1,2029

 Mahwah, NJ 1

 October 15, 2020

 August 1, 2024 4

 Melrose Park, IL 2

 November 21, 2024

 November 1, 2029

 Denver, CO 1

 September 6, 2022

 February 1, 2026

 Columbia, MD 2

 September 1, 2023

 February 1, 2027

 Grand Prairie, TX 1

 May 26, 2022

 August 1, 2026

 Allentown, PA 2

 May 23, 2023

 January 1, 2027

 Nashville, TN 1

 March 8, 2023

 May 1, 2027

 Indianapolis, IN

 May 23, 2023

 November 1, 2026

 New Britain, CT

 December 1, 2023

 January 1, 2028

 Shelton, CT 2

 May 23, 2023

 September 1, 2028

 Queens, NY 1

 November 21, 2024

 June 1, 2028

 East Windsor, CT 2

 March 13, 2024

 February 1, 2028

 South Plainfield, NJ 1

 August 14, 2024

 August 1, 2029

 Iselin, NJ

 May 15, 2018

 May 15, 2023 4

 Moorestown, NJ 3

 May 28, 2024

 May 1, 2028

 Paramus, NJ 3

 August 14, 2024

 May 15, 2028

 Lincoln, RI 3

 September 4, 2024

 May 1, 2028

 Marietta, GA 3

 May 1, 2022

 May 1, 2027

 East Point, GA 2

 December 20, 2023

 December 20, 2025 4

 Branch campus of main campus in Indianapolis, IN

 Branch campus of main campus in New Britain, CT

 Branch campus of main campus in Iselin, NJ

 Campus going through reaccreditation

 If one of our schools fails to comply with accrediting commission requirements, the institution and its main and/or branch campuses are subject to the loss of accreditation or may be placed on probation or a special
 monitoring or reporting status which, if the noncompliance is not resolved, could result in loss of accreditation or restrictions on the addition of new locations, new programs, or other substantive changes. If any one of our schools loses its
 accreditation, students attending that school would no longer be eligible to receive Title IV Program funding.

 Programmatic accreditation is yet another approval necessary in certain circumstances. Specifically, it is the process through which specific programs are reviewed and approved by industry and program-specific
 accrediting entities. Although programmatic accreditation is not generally necessary for Title IV Program eligibility, such accreditation may be required to operate the program in the state, to allow students to sit for certain licensure exams,
 or to work in a particular profession or career or to meet other requirements.

 Nature of Federal and State Support for Post-Secondary Education

 As noted above, the federal government provides a substantial part of the financial support for postsecondary education through Title IV Programs, in the form of grants and loans to students who can use those funds at
 any institution that has been certified as eligible by the DOE. Most aid under Title IV Programs is awarded on the basis of financial need, generally defined as the difference between the cost of attending the institution and the expected amount
 a student and his or her family can reasonably contribute to that cost. A recipient of Title IV Program funds must maintain a satisfactory grade point average and progress in a timely manner toward completion of his or her program of study and
 must meet other applicable eligibility requirements for the receipt of Title IV Program funds. In addition, each school must ensure that Title IV Program funds are properly accounted for and disbursed in the correct amounts to eligible students
 and provide reports on recipient data.

 Other Financial Assistance Programs

 Some of our students receive financial aid from federal sources other than Title IV Programs, such as programs administered by the VA. In addition, some states also provide financial aid to our students in the form of
 grants, loans or scholarships. The eligibility requirements for state financial aid and these other federal aid programs vary among the funding agencies and by program. States that provide financial aid to our students are facing significant
 budgetary constraints and some of them have reduced the level of state financial aid available to our students. Due to state budgetary shortfalls and constraints in certain states in which we operate, we believe that the overall level of state
 financial aid for our students is likely to continue to decrease in the near term, but we cannot predict how significant any such reductions will be or how long they will last. Federal budgetary shortfalls and constraints, or decisions by
 federal lawmakers to limit or prohibit access by our institutions or their students to federal financial aid, could result in a decrease in the level of federal financial aid for our students.

 In fiscal year 2024, we derived approximately 5.5% of our revenues, on a cash basis, from veterans' benefits programs, which include the Post-9/11 GI Bill and Veteran Readiness and Employment services. To continue
 participation in veterans' benefits programs, an institution must comply with certain requirements established by the VA, including that the institution must, among other things, report on the enrollment status of eligible students, maintain
 student records and make such records available for inspection, follow rules applicable to the individual benefits programs, comply with rules applicable to distance education and hybrid programs, and comply with applicable limits on the
 percentage of students having a portion of their tuition or other institutional charges paid by the school or with certain veterans' benefits. If we fail to comply with these or other applicable requirements, we could be subject to liabilities
 or sanctions including the loss of eligibility to participate in the programs.

 The VA shares responsibility for VA benefit approval and oversight with designated State Approving Agencies ("SAAs"). SAAs play a critical role in evaluating institutions and their programs to determine if they meet VA
 benefit eligibility requirements. Processes and approval criteria, as well as interpretation of applicable requirements, can vary from state to state. Therefore, approval in one state does not necessarily result in approval in all states.
 Changes in the applicable statutes, regulations, or appropriations applicable to the programs could impact our eligibility or funding under the programs.

 The VA imposes limitations on the percentage of students per program who have a portion of their tuition or other institutional charges paid by the school or with certain veterans' benefits, unless the program qualifies
 for certain waivers. On January 16, 2024, the VA published new regulations that, among other things, eliminate certain exceptions from these limitations and changed the criteria for obtaining a waiver of these rules. The VA simultaneously issued
 a bulletin delaying the applicability date to one year after the publication of the regulation to allow institutions to implement any necessary changes in their policies to comply with the new regulations. These new rules could make it more
 difficult for our programs to comply with these limitations. If the VA determines that a program is out of compliance with these limitations, the VA will continue to provide benefits to current students, but new students will not be eligible to
 use their veterans' benefits for an affected program until we demonstrate compliance. Additionally, the VA requires a campus be in operation for two years in certain cases before it can apply to participate in VA benefit programs. All of our
 campuses that are currently in operation are eligible to participate in VA education benefit programs.

 During 2012, President Obama signed an Executive Order directing the U.S. Department of Defense ("DOD"), the VA and DOE to establish "Principles of Excellence" (the "Principles"), based on certain guidelines set forth
 in the Executive Order, to apply to educational institutions receiving federal funding for service members, veterans and family members. As requested, we provided written confirmation of our intent to comply with the Principles to the VA in June
 2012. We are required to comply with the Principles to continue recruitment activities at military installations. Additionally, there is a requirement to execute a memorandum of understanding ("MOU") with the

 DOD as well as with certain individual installations. Each of our institutions has an MOU with the DOD. If our campuses fail to comply with VA, DOD, SAA, and other requirements applicable to financial aid programs for
 veterans or active military members, our schools and students could lose access to this funding or could be subject to restrictions or conditions on ability to receive such funding.

 Regulation of Federal Student Financial Aid Programs

 As noted above, in order to participate in Title IV Programs, an institution must be authorized to offer its programs by the state education agencies in the state in which it is physically located, be accredited
 by an accrediting commission recognized by the DOE and be certified as eligible by the DOE. The DOE will certify an institution to participate in Title IV Programs only after reviewing and approving the institution's application to participate
 in Title IV Programs. The DOE defines an institution to consist of both a main campus and its additional locations, if any. Under this definition, for DOE purposes as of December 31, 2024 we had the following three institutions,
 collectively consisting of three main campuses and 19 additional locations:

 Main Institution/Campus(es)

 Additional Location(s)

 Iselin, NJ

 Moorestown, NJ

 Paramus, NJ

 Lincoln, RI

 Marietta, GA

 New Britain, CT

 Shelton, CT

 Philadelphia, PA

 East Windsor, CT

 Melrose Park, IL

 Allentown, PA

 Columbia, MD

 East Point, GA

 Indianapolis, IN

 Grand Prairie, TX

 Nashville, TN

 Denver, CO

 Union, NJ

 Mahwah, NJ

 Queens, NY

 South Plainfield, NJ

 Each institution must periodically apply to the DOE for continued certification to participate in Title IV Programs. The institution also must apply for recertification when it undergoes a change in ownership resulting in a change of control and
 may come under DOE review when it undergoes a substantive change that requires the submission of an application, such as opening an additional location or raising the highest academic credential it offers. All institutions are recertified on
 various dates for various periods of time. The following table sets forth the expiration dates for each of our institutions' current Title IV Program participation agreements:

 Institution

 Expiration Date of Current

 Program Participation

 Agreement

 Iselin, NJ

 December 31, 2024 1

 Indianapolis, IN

 December 31, 2024 1

 New Britain, CT

 December 31, 2024 1

 Provisionally certified and recertification application under review.

 Each of our institutions has submitted an application to the DOE for continued certification to participate in Title IV Programs. The DOE regulations state that an institution's existing certification will be extended on a month-to-month
 basis following the expiration of the institution's period of participation until the end of the month in which the DOE issues a decision on the application for a renewal of certification as long as the institution has submitted a materially
 complete application by the applicable deadline prior to the expiration date of its current period of participation. Each of our three institutions submitted a materially complete application prior to the applicable expiration date. The DOE has
 confirmed in writing that each institution remains eligible to participate in Title IV Programs while the DOE reviews its recertification application.

 The DOE typically provides provisional certification status to an institution following a change in ownership resulting in a change of control and also may provisionally certify an institution for other reasons, including, but not limited to,
 noncompliance with certain standards of administrative capability and financial responsibility. The DOE provisionally certified all of our institutions based on findings in recent audits of each institution's Title IV Program compliance that the
 DOE alleges identified deficiencies related to DOE regulations regarding an institution's level of administrative capability. An institution that is provisionally certified receives fewer due process rights than those received by other
 institutions in the event the DOE takes certain adverse actions against the institution, is required to obtain prior DOE approvals of new campuses and educational programs, and may be subject to heightened scrutiny by the DOE. Provisional
 certification status makes it easier for the DOE to revoke or decline to renew our Title IV eligibility if the DOE chooses to take such an action against us and other provisionally certified for-profit schools without undergoing a formal
 administrative appeal process. The DOE could attempt to use an institution's provisional certification status as a basis for imposing additional conditions or restrictions on the institution.

 On October 31, 2023, the DOE published final regulations on a variety of topics including, but not limited to, regulations to authorize additional conditions and restrictions on provisionally certified institutions. See Part I, Item 1.
 "Business - Regulatory Environment – Negotiated Rulemaking." The regulations had a general effective date of July 1, 2024 and expand the grounds for placing institutions on provisional certification status, expand the types of conditions the DOE may impose on provisionally certified institutions, and expand the number of requirements contained in the institution's program participation agreement with the DOE (including, among other
 requirements, an obligation to comply with all state laws related to closure).

 The final regulations allow the DOE to place institutions on provisional certification status if, among other reasons, the institution does not meet financial responsibility factors or administrative capability standards, if the institution is
 required by the DOE to submit a letter of credit as a result of a mandatory or discretionary triggering event, or if the DOE deems the institution to be at risk of closure. The final regulations also allow the DOE to determine whether to certify
 or impose conditions on an institution based on consideration of factors including, for example, the institution's withdrawal rate, the amounts the institution spent on recruiting activities, advertising, and other pre-enrollment activities, and
 the passage rate for licensure exams for programs that are designed to meet the educational requirements for a professional license required for employment in an occupation.

 The final regulations also expand the types of conditions that the DOE can impose on provisionally certified institutions including, for example, restrictions on the addition of new programs or locations, restrictions on the rate of growth or
 new enrollment of students or of Title IV volume, restrictions on the institution providing a teach-out on behalf of another institution, restrictions on the acquisition of another participating institution (including financial protection
 requirements), additional reporting requirements, limitations on entering into certain written arrangements with institutions or entities for providing part of an educational program, requirements to submit marketing and recruiting materials to
 DOE for approval (if the institution is alleged or found to have engaged in substantial misrepresentations to students, engaged in aggressive recruiting practices, or violated incentive compensation rules), reporting requirements for institutions
 that received a government formal inquiry such as a subpoena related to its marketing or recruitment or its federal financial aid, and other potential conditions imposed by the DOE.

 The new regulations increase the possibility that our schools could remain in provisional certification status, be subject to additional reporting requirements and other conditions and sanctions such as letter of credit requirements and be
 subject to a potential loss of Title IV eligibility if our efforts to comply with the new regulations are unsuccessful.

 As noted above, the DOE is responsible for overseeing compliance with Title IV Program requirements. As a result, each of our schools is subject to detailed oversight and review, and must comply with a complex framework
 of laws and regulations. Additionally, the DOE periodically revises its regulations and changes its interpretation of existing laws and regulations.

 Significant factors relating to Title IV Programs that could adversely affect us include the following:

 Congressional and Presidential Action. Political and budgetary concerns significantly affect Title IV Programs. Congress periodically revises the HEA and
 other laws governing Title IV Programs. It is not known if or when Congress will pass final legislation that comprehensively reauthorizes and amends the HEA or other laws affecting U.S. federal student aid.

 In addition, Congress reviews and determines federal appropriations for Title IV Programs on an annual basis. Congress can also make changes in the laws affecting Title IV Programs in the annual appropriations
 bills and in other laws it enacts between the HEA reauthorizations such as its recent amendment to the 90/10 rule in the HEA. See Part I, Item 1. "Business - Regulatory Environment – 90/10 Rule." Similarly, the President could issue executive
 orders or take other actions and the DOE could establish new regulations or publish new guidance that could make it more difficult for our schools to operate and comply with applicable regulations. Moreover, Congress, or the President could
 take action to downsize or eliminate the DOE or transfer some or all of the authority and responsibilities of the DOE to another agency. Because a significant percentage of our revenues are derived from Title IV Programs, any action by
 Congress, the President or the DOE that significantly reduces Title IV Program funding, that limits or restricts the ability of our schools, programs, or students to receive funding through the Title
 IV Programs, or that imposes new restrictions or constraints upon our business or operations could reduce our student enrollment and our revenues, and could increase our administrative costs and
 require us to arrange for alternative sources of financial aid for our students and require us to modify our practices in order for our schools to comply fully with Title IV Program requirements. Further, current requirements for
 student or school participation in Title IV Programs may change or one or more of the present Title IV Programs could be replaced by other programs with materially different student or school eligibility requirements. The potential for changes
 related to the DOE or Title IV Programs that may be adverse to us and other for-profit schools like ours may increase as a result of changes in political leadership. We cannot predict the scope, timing or likelihood of future actions and changes
 by Congress, the President or the DOE with respect to the operations and existence of the DOE or the laws and regulations applicable to and the funding for the Title IV Programs. If we cannot comply with the provisions of the HEA and the
 regulations of the DOE as they may be revised or with the terms of an executive order or the Presidential action or if the cost of such compliance is excessive or if funding is materially reduced or disrupted by changes in Title IV Programs or
 DOE, our revenues or profit margin could be materially adversely affected.

 Gainful Employment. On October 10, 2023, the DOE published final new gainful employment and financial value transparency regulations which had a general
 effective date of July 1, 2024.

 The new regulations establish rules for annually evaluating each of our educational programs based on the calculation of debt-to-earnings rates (an annual debt-to-earnings rate and a discretionary debt-to-earnings rate) and an earnings premium
 measure based on an evaluation of median annual earnings. The DOE will calculate these rates and measures under complex regulatory formulas outlined in the regulations and using data such as student debt (including not only Title IV loans but
 also certain private loans and extensions of credit), student earnings data, and comparative median earnings data for young working adults with only a high school diploma or GED (including state-by-state annual earnings thresholds for 2024
 published by the DOE on December 31, 2024). If one or more of our educational programs were to yield debt-to-earnings rates or an earnings premium measure that do not comply with regulatory benchmarks for two of three consecutive years, we would
 lose Title IV eligibility for each of the impacted educational programs. The regulations will also require us to provide warnings to current and prospective students for programs in danger of losing of Title IV eligibility (which could deter
 prospective students from enrolling and current students from continuing their respective programs). The regulations also include provisions for providing certifications and reporting data to the DOE and providing required student disclosures
 related to gainful employment.

 The regulations include gainful employment rates and measures that will be based in part on data that is not readily accessible to us and other institutions, which make it difficult for us to predict with certainty how our educational programs
 will perform under the new gainful employment benchmarks and the extent to which certain programs could become ineligible for Title IV participation. The DOE released performance data at the time it published the proposed regulations that
 calculates rates for each school's program while acknowledging that the methodology used to produce the calculations differs from the methodology in the proposed regulations due to limitations in data availability. Because we do not have access
 to all of the data that will ultimately be used under the regulations to evaluate our programs and the DOE has not made this data available to us, we cannot predict whether, or the extent to which, our programs could fail to comply with the new
 gainful employment benchmarks. Moreover, we do not have control over some of the factors that could impact the rates and measures for our programs which will limit our ability to eliminate or mitigate the impact of the regulations on us and our
 educational programs.

 The DOE announced at the time it released the final gainful employment regulations that the first official outcome rates would be published in early 2025 and that programs that fail the gainful employment metric in the first two years the
 rates are issued would become ineligible in 2026. However, on February 14, 2025, the DOE announced it had extended the deadline for reporting gainful employment and financial value transparency data to the DOE to September 30, 2025, and stated
 it does not plan to produce any gainful employment and financial value transparency metrics prior to the new September 30, 2025 deadline. Additionally, as part of a consent motion to stay proceedings in a lawsuit in a federal district court in
 Texas seeking to stop the implementation of the gainful employment regulations, the DOE stated it does not expect to issue any gainful employment metrics before the fall of 2025, and stated the new Presidential administration is evaluating its
 position regarding the issues in the case. We cannot predict when the DOE will publish the first official outcome rates or what those rates will be. We also cannot predict the outcome of the pending lawsuit and whether it will result in the
 delay or prevention of the implementation of the new gainful employment regulations. The implementation of new gainful employment regulations could require us to eliminate or modify certain educational programs, could result in the loss of our
 students' access to Title IV Program funds for the affected programs, and could have a significant impact on the rate at which students enroll in our programs and on our business and results of operations.

 Borrower Defense to Repayment Regulations. The DOE's Borrower Defense to Repayment ("BDR") regulations establish processes for borrowers to receive from the DOE a discharge of the
 obligation to repay certain Title IV Program loans based on certain acts or omissions by the institution or a covered party. The regulations also establish processes for the DOE to seek recovery from the institution of the amount of discharged
 loans.

 On November 1, 2022, the DOE published new final BDR regulations with a general effective date of July 1, 2023 that also addressed other topics. The final regulations are extensive and generally make it easier for borrowers to obtain
 discharges of student loans and for the DOE to assess liabilities and other sanctions on institutions based on the loan discharges. The final regulations are currently under an injunction ordered by the Fifth Circuit Court of Appeals and
 currently under appeal to the U.S. Supreme Court. Therefore, the challenged amendments to the BDR regulations that were to take effect on July 1, 2023 are not in effect, but the previous BDR regulations generally remain in effect in the
 meantime and apply different substantive standards and procedures based on when a BDR claimant's loans were disbursed. We cannot predict the duration of the injunction, the ultimate outcome of the lawsuit, whether the DOE under the new
 administration will continue to defend against the lawsuit, or if and when the revised BDR regulations might take effect.

 Between April 2021 and February 2024, the Company received three separate notifications from the DOE that the DOE was in receipt of borrower defense claims containing allegations concerning our schools and requiring that the DOE undertake a
 fact-finding process pursuant to DOE regulations. The three separate notifications contained a total of approximately 3,000 borrower defense claims. Among other things, the communication outlined a process by which the DOE would provide the
 applications and allow us the opportunity to submit responses to them. Based upon publicly available information, it appears that the DOE has undertaken similar reviews of other educational institutions which have also been the subject of
 various borrower defense applications. We have received the borrower application claims and have completed the process of thoroughly reviewing and responding to each borrower application as well as providing information in response to the DOE's
 requests.

 In January 2025, the DOE published a press release announcing the discharge of a large number of loans at a large number of schools which included loans totaling approximately $1.4 million for 280 borrowers who attended our Massachusetts
 schools between 2010 and 2013. The notice does not acknowledge or evaluate our prior responses to those applications. The DOE may attempt to impose liability on the Company for reimbursement for the discharged loans. If the DOE seeks
 reimbursement from us for the discharged loan amounts, we would consider our options for challenging the legal and factual bases for such actions. In the event that the DOE were to prevail in any efforts seeking reimbursement for the discharged
 loans, it could have a material adverse effect on our business and results of operations.

 As previously reported, on June 22, 2022, the DOE and the plaintiff student loan borrowers in a class action against the DOE initiated on June 25, 2019 in the U.S. District Court for the Northern District of California
 ( Sweet v. Cardona, No. 3:19-cv-3674 (N.D. Cal.)) announced a proposed settlement agreement to resolve claims that the DOE had failed to timely decide Borrower Defense to Repayment applications submitted to
 the DOE. The proposed settlement included three categories of relief for student loan borrowers. First, the DOE would agree to discharge loans and refund prior loan payments to the class members with loan debt associated with an institution on
 the list included in the proposed settlement (which includes Lincoln institutions). The class action plaintiffs and the DOE stated that the DOE had determined that attendance at one of the listed institutions justifies presumptive relief
 allegedly based on strong indicia regarding substantial misconduct by the institutions, whether credibly alleged or in some instances proven, and the purportedly high rate of class members with applications related to the listed schools. Second,
 the proposed settlement included new procedures for the DOE to resolve pending borrower defense claims associated with other schools not on the list. Third, for any student loan borrower who submitted a borrower defense application after June
 22, 2022 and before the final approval of the settlement, the proposed settlement would require the DOE to review the applications under the DOE's 2016 regulatory standards and issue decisions within 36 months, or else the applications would be
 discharged in full.

 At the time that the class action plaintiffs and the DOE announced the proposed settlement, Lincoln was not a party to the lawsuit and none of the named plaintiffs had attended a Lincoln institution. In August 2022,
 Lincoln and three other schools were granted permission to intervene in the lawsuit to protect their interests in the finalization and implementation of any settlement agreement that the court might approve. On November 16, 2022, the federal
 district court approved the settlement as proposed and the DOE began implementing the settlement relief while Lincoln and other parties appealed the settlement's final approval to the U.S. Court of Appeals for the Ninth Circuit. On November 5,
 2024, the Ninth Circuit upheld the settlement on appeal. One or more parties are expected to continue to appeal the final approval of the settlement, but Lincoln does not intend to continue participating in the appeal. See Part I, Item I.
 "Business – Regulatory Environment – Borrower Defense to Repayment Regulations."

 The settlement provides automatic debt forgiveness and refunds, or a streamlined review process, for former students of over 150 schools, including our institutions, who had submitted borrower defense claims or before
 June 22, 2022. Based upon publicly available information, approximately 264,000 borrower defense claims associated with all schools were eligible for automatic relief or a streamlined review process as of June 22, 2022. The settlement also
 provides a 36-month deadline for the DOE to decide borrower defense claims submitted between June 23, 2022 and November 16, 2022, the date of the court's final approval of the settlement, under the DOE's 2016 regulatory standards. If the DOE
 does not decide those claims within 36 months, the applicants will receive automatic debt forgiveness and refunds without considering the merits of the claims. As a result of publicity about the opportunity afforded by the settlement,
 approximately 206,000 additional student borrowers submitted 250,000 applications prior to November 16, 2022.

 On January 13, 2023, Lincoln appealed the settlement's final approval to the U.S. Court of Appeals for the Ninth Circuit. Two of the three other intervener schools also appealed on the same date. The three schools
 appealing also sought to stay the implementation of the settlement while their appeals were being decided, but the requested stay was denied by the district court, the Ninth Circuit, and the U.S. Supreme Court. As a result, the DOE began
 implementing the settlement relief while the three schools appeal the settlement's final approval. The Ninth Circuit issued a panel decision on November 5, 2024, denying the appeal. Although the other appealing schools may continuing efforts to
 appeal this matter (including to the U.S. Supreme Court), we do not intend to continue to participate in the appeal process.

 It is not possible at this time to predict whether the settlement will continue to be upheld on appeal, what additional actions the DOE might take as the settlement continues to be upheld on appeal, or whether the DOE
 or other agencies might take actions against Lincoln institutions. Such actions could have a material adverse effect on our business and results of operations.

 It also remains unclear what loan discharge applications the DOE may receive and grant in the future and whether the DOE will assert repayment claims against us. As a result, we are not able to predict the ultimate
 outcome of the DOE's review of these applications at this time. If the DOE disagrees with our legal and factual grounds for contesting the applications, or if the DOE fails to adjudicate the claims within 36 months, the DOE could discharge the
 loans associated with the applications and award refunds to student borrowers. We believe that the DOE already may have discharged loans associated with some of the pending applications, but the DOE has not furnished definitive data to us
 necessary to determine the extent to which applications have been granted. The DOE may attempt to seek recoupment from applicable schools relating to loan discharges. If the DOE seeks reimbursement from us for the discharged loan amounts in any
 or all approved applications, we would consider our options for challenging the legal and factual bases for such actions. We cannot predict the outcome of any challenges we might make to such actions. In the event that the DOE were to prevail
 in any efforts seeking reimbursement for the discharged loans, it could have a material adverse effect on our business and results of operations.

 The "90/10 Rule." Under the HEA, a proprietary institution that derives more than 90% of its total revenue from Title IV Programs (its
 "90/10 Rule percentage") for two consecutive fiscal years becomes immediately ineligible to participate in Title IV Programs and may not reapply for eligibility until the end of at least two fiscal years. An institution with revenues exceeding
 90% for a single fiscal year will be placed in provisional certification status and may be subject to other enforcement measures, including a potential requirement to submit a letter of credit. See Part I, Item 1. "Business -
 Regulatory Environment – Financial Responsibility Standards." If an institution 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. A loss of eligibility to participate in Title IV Programs for any of our
 institutions would have a significant impact on the rate at which our students enroll in our programs and on our business and results of operations.

 We have calculated that for the fiscal year ended December 31, 2024, our institutions' 90/10 Rule percentages ranged from approximately 80% to 84%. For fiscal year 2024, none of our existing institutions derived
 more than 90% of its revenues from Title IV Programs. Our calculations are subject to review by the DOE.

 In March 2021, the American Rescue Plan Act of 2021 ("ARPA") was signed into law. Among other provisions, the ARPA includes a provision that amends the 90/10 Rule by treating other "federal funds that are disbursed or delivered to or on
 behalf of a student to be used to attend such institution" in the same way as Title IV Program funds are currently treated in the 90/10 Rule calculation. This means that our institutions are now required to limit the combined amount of Title IV
 Program funds and applicable "federal funds" revenue in a fiscal year to no more than 90% in a fiscal year as calculated under the rule. Consequently, the ARPA change to the 90/10 Rule is expected to increase the 90/10 Rule calculations at our
 institutions. The ARPA does not identify the specific federal funding programs that will be covered by this provision, but it is expected to include funding from federal student aid programs such as the veterans' benefits programs, which include
 the Post-9/11 GI Bill and Veterans Readiness and Employment services, from which we derived approximately 5.5% of our revenues on a cash basis in fiscal year 2024.

 The ARPA states that the amendments to the 90/10 Rule apply to institutional fiscal years beginning on or after January 1, 2023 and are subject to the HEA's negotiated rulemaking process. Beginning in January 2022, the DOE convened negotiated
 rulemaking committee meetings on a variety of topics including the 90/10 Rule. The committee reached consensus on proposed 90/10 Rule regulations during meetings in March 2022. On July 28, 2022, the DOE published proposed regulations regarding
 the 90/10 Rule among other topics. The DOE published final regulations on October 28, 2022 with a general effective date of July 1, 2023.

 The new 90/10 Rule regulations contain several new and amended provisions on a variety of topics including, among other things, confirming that the rules apply to fiscal years ending on or after January 1, 2023; noting that the DOE plans to
 identify the types of federal funds to be included in the 90/10 Rule in a notice in the Federal Register (which the DOE subsequently confirmed in a published notice on December 21, 2022 includes a wide range of federal student aid programs
 including VA and DOD programs); requiring institutions to disburse funds that students are eligible to receive for a fiscal year before the end of the fiscal year rather than delaying disbursements until a subsequent fiscal year; updating
 requirements for counting revenues generated from certain educational activities associated with institutional programs, from certain non-Title IV eligible educational programs, and from institutional aid programs such as institutional loans,
 scholarships, and income share agreements; updating technical rules for the 90/10 Rule calculation; including rules for sanctions for noncompliance with the 90/10 Rule and for required notifications to students and the DOE by the institution of
 noncompliance with the 90/10 Rule. The new regulations under the 90/10 Rule could have a material adverse effect on us and other schools like ours.

 We continue to evaluate the impact of the new 90/10 Rule regulations on our business. We continue to make changes to our operations in order to address the provisions in the 90/10 Rule and in order to maintain the 90/10 Rule percentages at
 our institutions below the 90% threshold as calculated under DOE regulations. However, we do not have significant control over the amount of Title IV Program funds that our students may receive and borrow. Our institutions' 90/10 Rule
 percentages can be increased by increases in Title IV Programs aid availability (including, for example, increases in Pell Grant funds) and can be decreased by decreases in the availability of state grant program funding and other sources of
 student aid that do not count as Title IV Programs funds in the 90/10 Rule calculation. Our institutions' 90/10 Rule percentages also will continue to increase when the ARPA amendments to the 90/10 Rule take effect to the extent that students
 eligible to receive military and veteran education assistance enroll and use their financial assistance at our institutions. We cannot be certain that the changes we continue to make to comply with the amended 90/10 Rule will succeed in
 maintaining our institutions' 90/10 Rule percentages below the required levels or that the changes will not materially impact our business operations, revenues, and operating costs. It also is possible that Congress or the DOE could amend the 90/10 Rule in the future to lower the 90% threshold, change the calculation methodology, or make other changes to the 90/10 Rule that could make it more difficult for our institutions to comply with the
 90/10 Rule.

 As noted above, if any of our institutions lose eligibility to participate in Title IV Programs, that loss would also adversely affect our students' access to various government-sponsored student financial aid programs, and would have a
 significant impact on the rate at which our students enroll in our programs and on our business and results of operations.

 Student Loan Defaults. The HEA limits participation in Title IV Programs by institutions whose former students defaulted on the repayment of federally
 guaranteed or funded student loans above a prescribed rate (the "cohort default rate"). The DOE calculates these rates based on the number of students who have defaulted, not the dollar amount of such defaults. The cohort default rate is
 calculated on a federal fiscal year basis and measures the percentage of students who enter repayment of a loan during the federal fiscal year and default on the loan on or before the end of the federal fiscal year or the subsequent two federal
 fiscal years.

 Under the HEA, an institution whose Federal Family Education Loan, or FFEL, and Federal Direct Loan, or FDL, cohort default rate is 30% or greater for three consecutive federal fiscal years loses eligibility to
 participate in the FFEL, FDL, and Pell programs for the remainder of the federal fiscal year in which the DOE determines that such institution has lost its eligibility and for the two subsequent federal fiscal years. An institution whose FFEL
 and FDL cohort default rate for any single federal fiscal year exceeds 40% loses its eligibility to participate in the FFEL and FDL programs for the remainder of the federal fiscal year in which the DOE determines that such institution has lost
 its eligibility and for the two subsequent federal fiscal years. If an institution's three-year cohort default rate equals or exceeds 30% in two of the three most recent federal fiscal years for which the DOE has issued cohort default
 rates, the institution may be placed on provisional certification status and could be required to submit a letter of credit to the DOE. See Part I, Item 1. "Business - Regulatory Environment – Financial
 Responsibility Standards."

 In September 2024, the DOE released the final cohort default rates for the 2021 federal fiscal year. These are the most recent final rates published by the DOE. The rates for our existing institutions for the 2021 federal fiscal year were
 zero. None of our institutions had a cohort default rate equal to or greater than 30% for the 2020 federal fiscal year. The DOE implemented a temporary suspension of repayment obligations and interest accruals on federal student loans during
 the COVID-19 pandemic for a period of over three years which contributed to a substantial reduction in our cohort default rates. We expect borrower defaults to increase during periods after the expiration of the temporary suspension which we
 expect will result in higher cohort default rates in the future particularly if borrowers do not successfully resume timely repayment of their federal student loans. We cannot predict how high our cohort default rates will increase in the
 future.

 In February 2025, the DOE released draft three-year cohort default rates for the 2022 federal fiscal year. The draft cohort default rates are subject to change pending receipt of the final cohort default rates, which the DOE is expected to
 publish in September 2025. The draft rates for our institutions for the 2022 federal fiscal year were zero.

 Financial Responsibility Standards.

 All institutions participating in Title IV Programs must satisfy specific standards of financial responsibility. The DOE evaluates institutions for compliance with these standards each year, based on 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 most significant financial responsibility measurement is the institution's composite score, which is calculated by the DOE based on three ratios:

 •

 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

 •

 the net income ratio, which measures the institution's ability to operate at a profit.

 The DOE assigns a strength factor to the results of each of these ratios on a scale from negative 1.0 to positive 3.0, with negative 1.0 reflecting financial weakness and positive 3.0 reflecting financial strength. The
 DOE then assigns a weighting percentage to each ratio and adds the weighted scores for the three ratios together to produce a composite score for the institution. 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 an institution is required to make disbursements to students under the Heightened Cash
 Monitoring 1 ("HCM1") payment method, or a different payment method other than the advance 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 equal to 50 percent of the Title IV Program funds received by the institution during its most recent fiscal year. The DOE permits an institution to participate under the "Zone Alternative" for a period of up to three consecutive fiscal
 years. Under the HCM1 payment method, the institution is required to make Title IV Program 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, an institution is 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 the 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 Program funds. 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 provides
 written authorization for the school to hold the credit balance.

 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 eligibility to participate in the Title IV Programs on an alternative basis by, among other things:

 •

 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; or

 •

 posting a letter of credit in an amount equal to at least 10% of the Title IV Program funds received by the institution during its most recently completed fiscal year accepting provisional certification
 status; 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.

 For the 2024 fiscal year, we calculated our composite score to be 2.5. Composite scores are subject to determination by the DOE based on its review of our consolidated audited financial statements, but we believe it is likely that the DOE will
 determine that our institutions comply with the composite score requirement.

 On October 31, 2023, the DOE published final regulations with a general effective date of July 1, 2024, that, among other things, modify and substantially expand the existing list in the regulations of
 triggering events that could result in the DOE determining that an institution lacks financial responsibility and must submit to the DOE a letter of credit or other form of acceptable financial protection and accept other conditions on the
 institution's Title IV Program eligibility. The regulations create lists of mandatory triggering events and discretionary triggering events.

 Examples of mandatory triggering events under the final rules include a lawsuit by a federal or state authority or a qui tam lawsuit in which the Federal government has intervened, where the suit has been pending for
 120 days as measured under the regulation; an action where the DOE seeks to recover the cost of adjudicated claims in favor of borrowers under the Borrower Defense to Repayment regulations and the claims would lower the institution's composite
 score below 1.0; certain judgments, awards, or settlements in certain lawsuits, mediations, or administrative or arbitration proceedings; certain withdrawals of owner's equity including by dividend; gainful employment issues; accreditor
 requirements to submit a teach-out plan for reasons related to financial concerns; certain actions taken against a publicly-traded company or failure to timely file certain annual or quarterly reports; 90/10 Rule issues; cohort default rate
 issues; contributions and distributions occurring near the fiscal year end that materially impact the composite score; certain defaults or other adverse events under a financing arrangement; or certain financial exigencies or receiverships.

 Examples of discretionary triggering events under the final regulations include certain accrediting agency actions, certain accreditor events, fluctuations in Title IV volume, high annual dropout rates, indicators of
 significant change in the financial condition of the institution, the formation by DOE of a group process to consider borrower defense claims against the institution, the institution's discontinuation of education programs affecting at least 25
 percent of enrolled students receiving Title IV funds, the institution's closure of locations that enroll more than 25 percent of its students who receive Title IV funds, certain state licensing agency actions, the loss of institutional or
 program eligibility in another federal educational assistance program, a requirement to disclose in a public filing that the company is under investigation for possible violations of law, or if the institution is cited and faces loss of education
 assistance funds from another federal agency if it does not comply with agency requirements. The final regulations also establish new rules for evaluating financial responsibility during a change in ownership.

 The final regulations increase the likelihood that the DOE could impose a financial protection requirement and other conditions on us and our institutions. The final rules require the institution to notify the DOE of
 a triggering event and provide information demonstrating why the event does not warrant the submission of a letter of credit or imposition of other requirements. The final rules state that, if the DOE requires financial protection as a result of
 more than one mandatory or discretionary trigger, the DOE will require separate financial protection for each individual trigger, which could substantially increase the amount of financial protection we and other institutions could be required to
 provide to the DOE.

 The expanded financial responsibility regulations could result in the DOE recalculating and reducing our composite score to account for DOE estimates of potential losses under one or more of the extensive list of
 triggering circumstances and also could result in the imposition of conditions and requirements, including a requirement to provide one or more letters of credit or other forms of financial protection.

 Return of Title IV Program Funds. An institution participating in Title IV Programs must calculate the amount of unearned Title IV Program funds that have
 been disbursed to students who withdraw from their educational programs before completing them, and must return those unearned funds to the DOE or the applicable lending institution in a timely manner, which is generally within 45 days from the
 date the institution determines that the student has withdrawn.

 If an institution is cited in an audit or program review for returning Title IV Program funds late for 5% or more of the students in the audit or program review sample, or if the regulatory auditor identifies a material
 weakness in the institution's report on internal controls relating to the return of unearned Title IV Program funds, the institution may be required to post a letter of credit in favor of the DOE in an amount equal to 25% of the total amount of
 Title IV Program funds that should have been returned for students who withdrew in the institution's prior fiscal year.

 On January 11, 2018, the DOE sent letters to our then existing Columbia, Maryland and Iselin, New Jersey institutions requiring each institution to submit a letter of credit to the DOE based on findings of late returns of Title IV Program
 funds in the annual Title IV Program compliance audits submitted to the DOE for the fiscal year ended December 31, 2016. Accordingly, we submitted letters of credit in the amounts of $0.5 million and $0.1 million to the DOE by the February 23,
 2018, deadline and we continue to comply with the letter of credit requirement. By letter dated February 16, 2021, the DOE notified us that our Columbia and Iselin institutions failed to comply with the refund requirements based on their 2017,
 2018, and 2019 audits. Consequently, the DOE has required us to maintain with the DOE a letter of credit in the amount of $600,020. The DOE extended the expiration date of this letter of credit until January 31, 2026 based on its conclusion
 that the compliance audits for the three institutions for 2020 through 2022 contained compliance findings related to refunds even though many of the audits did not contain late refund findings.

 More recently, the DOE commenced a negotiated rulemaking process and conducted meetings from January through March 2024 for a negotiated rulemaking committee to discuss proposed regulations on a number of topics including plans to amend the
 regulations on the requirements for institutions to return unearned Title IV funds to students who withdraw from their educational programs before completing them. The
 DOE published final regulations on January 3, 2025 with a general effective date of July 1, 2026 on topics including, among others, refunds for students who do not begin attendance at the school or who withdraw from school, the requirement to
 determine the date a student withdrew from school, the refund calculations for clock hour programs, and the calculation of withdrawal dates and refunds for programs provided in modules The DOE did not include a proposal regarding attendance
 requirements for distance education programs. We are in the process of reviewing these new regulations and their potential impact on our business and results of operations. See Part I, Item 1. "Business - Regulatory Environment – Negotiated
 Rulemaking."

 Negotiated Rulemaking. The DOE initiated rulemaking on several topics in January 2022 and, after delaying the process, announced in January 2023 its intention to reinitiate the
 rulemaking process on topics including gainful employment, financial responsibility, administrative capability, certification procedures, ability to benefit, and improving income-driven repayment of loans. On May 19, 2023, the DOE published a
 notice of proposed rulemaking in the Federal Register that included proposed regulations on topics including gainful employment, financial responsibility, administrative capability, certification, and ability to benefit. On October 10, 2023, the
 DOE published the final gainful employment regulations which had a general effective date of July 1, 2024. See Part I, Item 1. "Business - Regulatory Environment – Gainful Employment." On October 31, 2023, the DOE published final regulations
 regarding financial responsibility, administrative capability, certification standards and procedures, and ability to benefit. The regulations had a general effective date of July 1, 2024. See Part I, Item 1. "Business - Regulatory Environment –
 Financial Responsibility," "Regulatory Environment – Administrative Capability," and "Regulatory Environment – Regulation of Federal Student Financial Aid Programs."

 The final regulations impose a broad range of additional requirements on institutions and especially on for-profit institutions like our schools, which increase the possibility that our schools could be subject to
 additional reporting requirements, potential liabilities and sanctions, and potential loss of Title IV eligibility if our efforts to modify our operations to comply with the new regulations are unsuccessful, which could have a significant impact
 on our business and results of operations.

 The DOE also commenced a new negotiated rulemaking process with meetings conducted from January through March 2024 on several topics including state authorization, accreditation, return of unearned Title IV Program funds for students who
 withdraw from school without completing their educational programs, cash management, and distance education. See Part I, Item 1. "Business – Regulatory Environment – State Authorization," "Regulatory Environment – Accreditation," and
 "Regulatory Environment – Return of Title IV Program Funds."

 On July 24, 2024, the DOE published a notice of proposed rulemaking on distance education, return of Title IV funds, and other topics. The DOE published the final rule on January 3, 2025 with a general effective date
 of July 1, 2026. The distance education rules, among other changes, add a definition of ''distance education course'' and require institutions to report information about which Title IV students are enrolled in distance education courses. The
 DOE did not move forward with other distance education proposals such as expanding the definition of additional location to include virtual locations for programs offered entirely online or through correspondence or disallowing asynchronous
 distance education in clock hour programs for Title IV purposes. The final regulations also amended certain portions of the return of Title IV funds regulations. See Part I, Item I. "Business – Regulatory Environment – Return of Title IV
 Funds."

 The DOE could issue new regulations and guidance in the future. For example, the DOE previously announced its intention to conduct negotiated rulemaking at a date to be determined to consider regulations related to
 third-party servicers on topics including, for example, the definition of third-party servicers, audit requirements for servicers, an application process for servicers, and reporting, financial, past performance, and other compliance
 requirements. The DOE also previously announced that it plans to issue revised guidance on how institutions of higher education may compensate their recruiters. See Part I, Item 1. "Business - Regulatory Environment – Restrictions on payment
 of Commissions, Bonuses and Other Incentive Payments." We cannot predict the timing and scope of any regulations or guidance the DOE might issue on these or other topics (or whether the DOE under the new administration will issue such
 regulations or guidance), but new regulations or guidance on these or other topics could increase the possibility that our schools could be subject to additional reporting requirements, to potential liabilities and sanctions such as letter of
 credit requirements, and to potential loss of Title IV eligibility if our efforts to modify our operations to comply with any new requirements are unsuccessful which could have a significant impact on our business and results of operations.

 Substantial Misrepresentation. The DOE's regulations prohibit an institution that participates in Title IV Programs from engaging in substantial misrepresentation of the nature of
 its educational programs, financial charges, graduate employability or its relationship with the DOE. A "misrepresentation" includes any false, erroneous, or misleading statement (whether made in writing, visually, orally, or through other means)
 that is made by an eligible institution, by one of its representatives, or by a third party that provides to the institution educational programs, marketing, advertising, recruiting, or admissions services and that is made to a student,
 prospective student, any member of the public, an accrediting or state agency, or to DOE. The DOE defines a "substantial misrepresentation" to include any misrepresentation on which the person to whom it was made could reasonably be expected to
 rely, or has reasonably relied, to that person's detriment. The definition of "substantial misrepresentation" is broad and, therefore, it is possible that a statement made by the institution or one of its service providers or representatives
 could be construed by the DOE to constitute a substantial misrepresentation. On January 16, 2025, the DOE published guidance reinforcing that the misrepresentation rules apply equally to various types of statements made by a third-party entity
 engaged by the institution and their respective employees, contractors, and representatives and that institutions may be responsible for the consequences of misrepresentation committed by any external service provider that they engage. If the
 DOE determines that one of our institutions has engaged in substantial misrepresentation, the DOE may impose sanctions or other conditions upon the institution including, but not limited to, initiating an action to fine the institution or limit,
 suspend, or terminate its eligibility to participate in the Title IV Programs and may seek to discharge students' loans and impose liabilities upon the institution. The DOE published final regulations on
 November 1, 2022 on a variety of topics including, amended and expanded regulations on substantial misrepresentations. Specifically, the new regulations expand the types of conduct that could result in a discharge of student loans
 including: 1) an expanded list of substantial misrepresentations; 2) a new section regarding substantial omissions of fact; 3) breaches of contract; 4) a new section regarding aggressive and deceptive recruitment; or 5) state or federal
 judgments or final DOE actions that could result in a borrower defense claim. Some of these forms of conduct also could result in further scrutiny of marketing and recruiting practices by institutions like our schools and could increase the
 chances of the DOE finding practices to be noncompliant and imposing sanctions based on the alleged noncompliance up to and including fines and potential loss of Title IV eligibility. See Part I, Item 1. "Business - Regulatory Environment –
 Borrower Defense to Repayment Regulations."

 In March 2022, the DOE published guidance about the enforcement of the requirements regarding substantial misrepresentations. The DOE indicated that it is monitoring complaints and Borrower Defense to Repayment applications from veterans,
 service members, and their family members who report that personnel and representatives of postsecondary schools suggested during the enrollment process that their military education benefits would cover all of the costs of their program but were
 told subsequently they would have to take out student loans to finish the program. The DOE stated that it would ensure that institutions engaging in misrepresentations are held accountable if they cause a student to incur extra costs unwittingly
 or without a full understanding of the implications of borrowing. The DOE also indicated that such students could be entitled to discharge of their student loans and that it would share information and complaints about military-connected
 students with the DOD and VA for potential agency action.

 School Acquisitions/Change of Control. When a company acquires a school that is eligible to participate in Title IV Programs, that
 school undergoes a change of ownership resulting in a "change of control" as defined by the DOE. Upon such a change of control, a school's eligibility to participate in Title IV Programs is generally suspended until it has applied for
 recertification by the DOE as an eligible school under its new ownership, which requires that the school also re-establish its state authorization and accreditation. Thus, any plans to expand our business through acquisition of additional
 schools and have them certified by the DOE to participate in Title IV Programs must take into account the approval requirements of the DOE and the relevant state education agencies and accrediting commissions. On October 30, 2022, the
 DOE published final regulations with a general effective date of July 1, 2023 concerning change of control which, among other things, expand the requirements applicable to school acquisitions in ways that could make it more difficult to acquire
 additional schools.

 In addition to school acquisitions, other types of transactions can also cause a change of control. The DOE, most state education agencies and our accrediting commissions have standards pertaining to the change of control of schools, but these
 standards are not uniform. DOE regulations describe some transactions that constitute a change of control, including the transfer of a controlling interest in the voting stock of an institution or the institution's parent corporation. For a
 publicly traded corporation, DOE regulations provide that a change of control occurs in one of two ways: (a) if a person acquires ownership and control of the corporation so that the corporation is required to file a Current Report on Form 8-K
 with the Securities and Exchange Commission disclosing the change of control or (b) if the corporation has a shareholder that owns at least 25% of the total outstanding voting stock of the corporation and is the largest shareholder of the
 corporation, and that shareholder ceases to own at least 25% of such stock or ceases to be the largest shareholder. These standards are subject to interpretation by the DOE. A significant purchase or
 disposition of our Common Stock could be determined by the DOE to be a change of control under this standard.

 Most of the states and our accrediting commissions include the sale of a controlling interest of Common Stock in the definition of a change of control although some agencies could determine that the sale or
 disposition of a smaller interest would result in a change of control. A change of control under the definition of one of these agencies would require the affected school to reaffirm its state authorization or accreditation. Some agencies would
 require approval prior to a sale or disposition that would result in a change of control in order to maintain authorization or accreditation. The requirements to obtain such reaffirmation from the states and our accrediting commissions vary
 widely.

 A change of control could occur as a result of future transactions in which the Company or our schools are involved. Some corporate reorganizations and some changes in the Board of Directors of the Company are examples of such transactions.
 Moreover, the potential adverse effects of a change of control could influence future decisions by us and our shareholders regarding the sale, purchase, transfer, issuance or redemption of our stock. In addition, the adverse regulatory effect of
 a change of control also could discourage bids for shares of our Common Stock and could have an adverse effect on the market price of our shares.

 Opening Additional Schools and Adding Educational Programs. For-profit educational institutions must be authorized by their state education agencies and be
 fully operational for two years before applying to the DOE to participate in Title IV Programs. However, an institution that is certified to participate in Title IV Programs may establish an additional location and apply to participate in Title
 IV Programs at that location without reference to the two-year requirement, if such additional location satisfies all other applicable DOE eligibility requirements. Our strategic plans for future expansion are based, in part, on our ability to
 open new schools as additional locations of our existing institutions and take into account the applicable approval requirements of the DOE and our other regulatory agencies.

 A student may use Title IV Program funds only to pay the costs associated with enrollment in an eligible educational program offered by an institution participating in Title IV Programs. Generally, unless otherwise
 required by the DOE or by DOE regulations, an institution that is eligible to participate in Title IV Programs may add a new educational program without DOE approval. However, institutions that are provisionally certified may be required to
 obtain approval of new educational programs. Our institutions are provisionally certified and required to obtain prior DOE approval of new locations and of new educational programs. If an institution erroneously determines that an educational
 program is eligible for purposes of Title IV Programs, the institution would likely be liable for repayment of Title IV Program funds provided to students in that educational program. Our expansion plans are based, in part, on our ability to add
 new educational programs at our existing schools.

 Some of the state education agencies and our accrediting commission also have requirements that may affect our schools' ability to open a new campus, establish an additional location of an existing institution or begin
 offering a new educational program. The DOE has published final regulations that further restrict the ability of some schools – such as schools that are provisionally certified – to add new locations or educational programs, which could impact
 our ability to make such changes if we are provisionally certified or subject to other criteria in the regulations.

 Closed School Loan Discharges. The DOE may grant closed school loan discharges of federal student loans based upon applications by qualified students. The DOE also may initiate discharges on its own for students who have not reenrolled in another Title IV Program eligible school within three years after the closure and who attended campuses that closed on or
 after November 1, 2013, as did some of our former campuses. If the DOE discharges some or all of these loans, the DOE may seek to recover the cost of the loan discharges from us. As noted above, the DOE published final regulations on November 1,
 2022 with a general effective date of July 1, 2023 on a variety of topics, including closed school loan discharges (and, among other things, the reintroduction of automatic closed school loan discharges), which would make it easier for borrowers
 to obtain discharges of their loans and for the DOE to recover liabilities from institutions. As also noted above, certain borrower defense and closed school loan discharge provisions of the new regulations are currently under an injunction
 ordered by the Fifth Circuit Court of Appeals and currently under appeal to the U.S. Supreme Court. Therefore, the challenged amendments to the BDR and closed school discharge regulations that were to take effect on July 1, 2023 are not in
 effect, but the previous BDR and closed school discharge regulations in effect prior to July 1, 2023, generally remain in effect in the meantime. See Part I, Item I. "Business – Regulatory Environment
 – Borrower Defense to Repayment." We cannot predict with certainty any additional closed school loan discharges that the DOE may approve or the liabilities that the DOE may seek from us for campuses that have closed in the past or any possible
 school closures in the future.

 Subsequent to the end of the third quarter of 2024, our Board of Directors approved a plan to sell the assets related to the Las Vegas, Nevada campus operated under Euphoria Institute of Beauty Arts & Sciences ("Euphoria"). The Company
 entered into a signed agreement and closed the transaction on January 1, 2025. While the transaction is not material, the transaction will be treated as a school closure by Lincoln for regulatory purposes. There were approximately 300 students
 enrolled in programs at Euphoria as of the closing date of the transaction. Such students are being permitted to transfer to the purchaser-operated school post-closing and continue their programs such that the sale should not have a significant
 impact on the student experience.

 The DOE confirmed that the transaction will not be treated as a change in ownership and, instead, will be treated as the closure of Euphoria and the establishment of a new location by the purchaser at the site of Euphoria. Although the parties
 continue to work toward enabling our students at the Las Vegas, Nevada campus at the time of the transaction to complete their programs with the purchaser, certain current and former students could qualify for closed school loan discharges if
 they do not continue and complete their programs and, in turn, the DOE could impose liabilities and other sanctions on us based on any such closed school loan discharges. We cannot predict at this time the potential amount of any closed school
 discharge liabilities related to the Euphoria transaction, but we do not expect the dollar amount of such discharges to have a material adverse effect on our business and results of operations. Also, we will be required to comply with other DOE,
 state, and accreditor requirements associated with the transaction, the transfer of the site, and the teaching of current students.

 Administrative Capability. The DOE assesses the administrative capability of each institution that participates in Title IV Programs under a series of
 separate standards. Failure to satisfy any of the standards may lead the DOE to find the institution ineligible to participate in Title IV Programs or to place the institution in provisional certification status as a condition of its
 participation. These criteria require, among other things, that the institution:

 •

 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 Program 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 the Title IV Program;

 •

 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 Title IV Program regulations; and

 •

 not otherwise appear to lack administrative capability.

 The DOE has placed all of our institutions in provisional certification status based on findings in recent audits of the institutions' Title IV compliance that the DOE alleges identified deficiencies in
 regulations related to DOE regulations regarding an institution's level of administrative capability. See Part I. Item 1. "Business - Regulatory Environment – Regulation of Federal Student Financial Aid Programs."

 The DOE published final regulations on October 31, 2023 that, among other issues, expand the scope of the administrative capability regulations to include other requirements (such as, for example, providing adequate
 financial aid counseling and career services, ensuring the availability of clinical and externship opportunities, the disbursement of Title IV funds in a timely manner, compliance with high school diploma requirements, preventing substantial
 misrepresentations, complying with gainful employment requirements, and avoiding significant negative actions with a federal, state, or accrediting agency). The regulations had a general effective date of July 1, 2024.

 Failure by us to satisfy any of these or other administrative capability criteria could cause our institutions to be subject to sanctions or other actions by the DOE including the loss of eligibility to participate in
 Title IV Programs, which would have a significant impact on our business and results of operations.

 Restrictions on Payment of Commissions, Bonuses and Other Incentive Payments. An institution participating in Title IV Programs may not
 provide any commission, bonus or other incentive payment based directly or indirectly on success in securing enrollments or financial aid to any person or entity engaged in any student recruiting or admission activities or in making decisions
 regarding the awarding of Title IV Program funds. The DOE's regulations established 12 "safe harbors" identifying types of compensation that may be paid without violating the incentive compensation rule. On October 29, 2010, the DOE
 adopted final rules that took effect on July 1, 2011 and amended the incentive compensation rule by, among other things, eliminating the 12 safe harbors (thereby reducing the scope of permissible compensatory payments under the rule) and
 expanding the scope of compensatory payments and employees subject to the rule. We cannot predict how the DOE will interpret and enforce the revised incentive compensation rule and the limited published guidance that the DOE has provided, nor
 how it will apply the rule and guidance to our past, present, and future compensation practices, or whether the DOE will issue new regulations or guidance on the subject. See Part I, Item I. "Business – Regulatory

 Environment – Negotiated Rulemaking." The implementation of the final regulations have required us to change our compensation practices and has had and will continue to have a significant impact on the
 productivity of our employees, on the retention of our employees and on our business and results of operations.

 Compliance with Regulatory Standards and Effect of Regulatory Violations. Our schools are subject to audits, program reviews, site visits, and other reviews by
 various federal and state regulatory agencies, including, but not limited to, the DOE, the DOE's Office of Inspector General ("OIG"), state education agencies and other state regulators, the VA and other federal agencies (such as, for example,
 the FTC or the CFPB), and by our accrediting commissions. In addition, each of our institutions must retain an independent certified public accountant to conduct an annual compliance audit of the institution's administration of Title IV Program
 funds. The institution must submit the resulting annual compliance audit report to the DOE for review. The annual compliance audit reports for our institutions contain findings on topics that were the subject of findings in prior audits although
 the amount of questioned funds in the reports are immaterial. The reoccurrence of findings in our compliance audit reports could result in the DOE initiating an adverse action against one or more of our institutions. Significant violations of
 Title IV Program requirements by any of our institutions could become the basis for the DOE to impose liabilities on us or initiate an adverse action to limit, suspend, terminate, revoke, or decline to renew the participation of the affected
 institution in Title IV Programs or to seek civil or criminal penalties. Generally, a termination of Title IV Program eligibility extends for 18 months before the institution may apply for reinstatement of its participation. Some of the findings
 in the annual Title IV Program compliance audits for some of our institutions resulted in the DOE placing those institutions in provisional certification status. See Part I. Item 1. "Business - Regulatory Environment – Regulation of Federal
 Student Financial Aid Programs."

 If one of our schools fails to comply with accrediting or state licensing requirements, such school and its main and/or branch campuses could be subject to the loss of state licensure or accreditation, which in turn could result in a loss of
 eligibility to participate in Title IV Programs. If the DOE or another agency determined that one of our institutions improperly disbursed Title IV Program funds or violated a provision of the HEA or DOE regulations, the institution could be
 required to repay such funds and related costs to the DOE and lenders, and could be assessed an administrative fine. The DOE could also place the institution in provisional certification status and/or transfer the institution to the reimbursement
 or cash monitoring system of receiving Title IV Program funds, under which an institution must disburse its own funds to students and document the students' eligibility for Title IV Program funds before receiving such funds from the DOE. See
 Part I, Item 1. "Business - Regulatory Environment – Financial Responsibility Standards."

 Consumer Protection Laws and Scrutiny of the For-Profit Postsecondary Education Sector. As a postsecondary
 educational institution, we are subject to a broad range of consumer protection and other laws, such as recruiting, marketing, the protection of personal information, student financing and payment servicing, enforced by federal agencies such as
 the FTC and CFPB and various state agencies and state attorneys general. We devote significant effort to complying with state and federal consumer protection laws. In recent years, Congress, the DOE, state legislatures and regulatory agencies,
 accrediting agencies, the CFPB, the FTC, the SEC, the Department of Justice, state attorneys general and the media have scrutinized the for-profit postsecondary education sector. Congressional hearings and other inquiries have occurred regarding
 various aspects of the education industry, including issues surrounding student debt as well as publicly reported student outcomes that may be used as part of an institution's recruiting and admissions practices, and reports have been issued that
 are highly critical of for-profit colleges and universities.

 In addition to Title IV Programs and other government-administered programs, all of our schools offer extended financing programs to their students. This extension of credit helps fill the gap between what the student
 receives from all financial aid sources and what the student may need to cover the full cost of his or her education. Students or their parents can apply to a number of different unaffiliated lenders for this funding at current market interest
 rates. In such regard, we are required to comply with applicable federal and state laws related to certain consumer and educational loans and credit extensions, which may be subject to the supervisory authority of the CFPB.

 Available Information.

 The Company's website is www.lincolntech.edu. The Company makes available free of charge on its website its Annual Report on Form 10-K, Quarterly
 Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after it electronically files such material with, or
 furnishes it to, the SEC. Information contained on the Company's website is not a part of this Annual Report on Form 10-K and is not incorporated herein by reference.

 Item 1A.

 RISK FACTORS

 The risk factors described below and other information included elsewhere in this Annual Report on Form 10-K are among the numerous risks faced by our Company and should be carefully considered before deciding to invest
 in, sell or retain shares of our Common Stock. These are factors that, individually or in the aggregate, could cause our actual results to differ materially from expected and historical results and the risks and uncertainties described below are
 not the only ones we face. Investors should understand that it is not possible to predict or identify all such risks and, as such, should not consider the following to be a complete discussion of all potential risks and uncertainties that may
 affect the Company. Investors should consider carefully the risks and uncertainties described below in addition to other information contained in this Annual Report on Form 10-K, including our Consolidated Financial Statements and related notes.

 RISKS RELATED TO OUR INDUSTRY

 Our failure to comply with the extensive regulatory requirements applicable to our participation in Title IV Programs and our school operations could result in financial penalties, restrictions on our
 operations and loss of external financial aid funding, which could affect our revenues and impose significant operating restrictions upon us.

 Our industry is highly regulated by federal and state governmental agencies and by accrediting commissions. The various regulatory agencies applicable to our business periodically revise their requirements and modify
 their interpretations of existing requirements and restrictions. We cannot predict with certainty how any of these regulatory requirements will be applied or whether each of our schools will be able to comply with such revised requirements in the
 future. Given the complex nature of the regulations and the fact that they are subject to interpretation, it is reasonable to conclude that in the conduct of our business, we may inadvertently violate such regulations. In particular, the HEA and
 DOE regulations specify extensive criteria and numerous standards that an institution must satisfy to establish to participate in the Title IV Programs. For a description of these federal, state, and accrediting agency criteria, see Part I, Item
 1. "Business - Regulatory Environment."

 If we are found to have not satisfied the HEA or the DOE's requirements for Title IV Programs funding, one or more of our institutions, including its additional locations, could be limited in its access to, or
 lose, Title IV Program funding, which could adversely affect our revenue, as we received approximately 82% of our revenue (calculated based on cash receipts) from Title IV Programs during the fiscal year ended December 31, 2024, and have a
 significant impact on our business and results of operations. If we or any of our schools fail to comply with applicable federal, state, or accrediting agency requirements, our regulators could take a variety of adverse actions against us, and
 our schools could be subject to, among other things, a) the loss of, or placement of material restrictions or conditions on (i) state licensure or accreditation, (ii) eligibility to participate in and receive funds under the Title IV Programs
 or other federal or state financial assistance programs, or (iii) capacity to grant degrees, diplomas and certificates or b) the imposition of liabilities or monetary penalties, or a requirement to provide a letter of credit or other financial
 protection, any of which could have a material adverse effect on academic or operational initiatives, revenues or financial condition, and impose significant operating restrictions upon us. See Part I, Item 1. "Business – Regulatory
 Environment – Compliance with Regulatory Standards and Effect of Regulatory Violations" and "Business – Regulatory Environment – Other Financial Assistance Programs."

 If we fail to demonstrate "administrative capability" to the DOE, our business could suffer.

 DOE regulations specify extensive criteria an institution must satisfy to establish that it has the requisite "administrative capability" to participate in Title IV Programs, and the DOE recently published new regulations that expand the
 number and scope of these criteria. For a description of these criteria, see Part I, Item 1. "Business - Regulatory Environment – Administrative Capability."

 If we are found not to have satisfied the DOE's "administrative capability" requirements, or to have otherwise failed to comply with one or more DOE requirements, one or more of our institutions and its additional locations could be limited in
 its access to, or lose, Title IV Program funding. This could adversely affect our revenue, as we received approximately 82% of our revenue (calculated based on cash receipts) from Title IV Programs in 2024, which would have a significant impact
 on our business and results of operations. The DOE has placed all of our institutions in provisional certification status based on findings in recent audits of the institutions' Title IV compliance
 that the DOE alleges identified deficiencies in regulations related to DOE regulations regarding an institutions' level of administrative capability. See Part I, Item 1. "Business - Regulatory Environment – Regulation of Federal Student
 Financial Aid Programs."

 Congress, the President and the DOE may make changes to the DOE or the laws and regulations applicable to, or reduce funding for, Title IV Programs, which could reduce our student population, revenues or profit
 margin.

 Congress periodically revises the HEA and other laws governing Title IV Programs and annually determines the funding level for each Title IV Program. We cannot predict what, if any, legislative or other actions will be taken or proposed by
 Congress in connection with the reauthorization of the HEA or other such activities of Congress, although Congress recently made a change to the 90/10 Rule that will make it harder for schools like ours that are subject to the rule to comply with
 the rule. See Part I, Item 1. "Business - Regulatory Environment – Congressional Action." Similarly, the President could issue executive orders or take other actions and the DOE could establish new regulations, that could make it more difficult
 for our schools to operate and comply with applicable regulations. Moreover, Congress, or the President, could take action to downsize or eliminate the DOE or transfer some or all of the DOE's authority or responsibilities to another agency or
 to the States. Because a significant percentage of our revenues is derived from the Title IV Programs, any action by Congress, the President, or the DOE that significantly reduces funding for Title IV Programs or that limits the ability of our
 schools, programs, or students to receive funding through such programs, that disrupts the operations of such programs, or that imposes new restrictions upon our business or operations could reduce our student enrollment and our revenues,
 increase our administrative costs, require us to arrange for alternative sources of financial aid for our students, and require us to modify our practices in order to fully comply. In addition, current requirements for Title IV Program
 participation may change or the present Title IV Programs could be replaced by other programs with materially different eligibility requirements. The potential for changes to the DOE or the Title IV Programs that may be adverse to us and other
 for-profit schools like ours may increase as a result of changes in political leadership. The DOE continues to engage in a process to establish new regulations that have increased, and will continue to increase, the number and scope of
 regulatory requirements applicable to our schools. See Part I, Item 1. "Business – Regulatory Environment – Negotiated Rulemaking." We cannot predict the scope, timing or likelihood of future actions and changes by Congress, the President or
 the DOE with respect to the operations or existence of the DOE or the laws and regulations applicable to and the funding for the Title IV Programs. If we cannot comply with the provisions of the HEA and the regulations of the DOE, as they may be
 revised, or with the terms of an executive order or other executive action, or if the cost of such compliance is excessive, or if funding is materially reduced, or if funding is materially reduced or disrupted by changes to Title IV Programs, our
 revenues or profit margin could be materially adversely affected.

 We could be subject to liabilities, letter of credit requirements, and other sanctions under the DOE's Borrower Defense to Repayment regulations.

 The DOE's Borrower Defense to Repayment regulations establish processes for borrowers to receive from the DOE a discharge of the obligation to repay certain Title IV Program loans based on certain acts or omissions by the institution or a
 covered party. The regulations also establish processes for the DOE to seek recovery from the institution of the amount of discharged loans. The regulations regarding Borrower Defense to Repayment and regarding closed school loan discharges are
 extensive and generally make it easier for borrowers to obtain discharges of student loans and for the DOE to assess liabilities and other sanctions on institutions based on the loan discharges. The implementation and enforcement of these
 Borrower Defense to Repayment and closed school loan discharge regulations could have a material adverse effect on our business and results of operations. See Part I, Item 1. "Business - Regulatory Environment – Borrower Defense to Repayment
 Regulations" and "Business – Regulatory Environment – Closed School Loan Discharges."

 The U.S. District Court for the Northern District of California ( Sweet v. Cardona, No. 3:19-cv-3674 (N.D. Cal.)) has approved a class action settlement that could result in the granting of all borrower defense applications submitted to the DOE concerning our institutions and,
 potentially, could lead to the DOE seeking recoupment from us of all loan amounts in the granted applications.

 On June 22, 2022, the DOE and the plaintiff student loan borrowers in a class action against the DOE initiated on June 25, 2019 in the U.S. District
 Court for the Northern District of California ( Sweet v. Cardona, No. 3:19-cv-3674 (N.D. Cal.)) announced a proposed settlement agreement to resolve claims
 that the DOE had failed to timely decide Borrower Defense to Repayment applications submitted to the DOE. The proposed settlement included three categories of relief for student loan borrowers. First, the DOE would agree to discharge loans and
 refund prior loan payments to class members with loan debt associated with an institution on the list included in the settlement (which includes Lincoln institutions). The class action plaintiffs and the DOE stated that the DOE had determined
 that attendance at one of the listed institutions justifies presumptive relief allegedly based on strong indicia regarding substantial misconduct by the institutions, whether credibly alleged or in some instances proven, and the purportedly high
 rate of class members with applications related to the listed schools. Second, the proposed settlement included new procedures for the DOE to resolve pending borrower defense claims associated with other schools not on the list. Third, for any
 student loan borrower who submitted a borrower defense application after June 22, 2022 and before the final approval of the settlement, the proposed settlement would require the DOE to review the applications under the DOE's 2016 regulatory
 standards and issue decisions within 36 months, or else the applications would be discharged in full. On November 16, 2022, the federal district court approved the settlement as proposed and the DOE began implementing the settlement relief while
 Lincoln and other parties appealed the settlement's final approval to the U.S. Court of Appeals for the Ninth Circuit. On November 5, 2024, the Ninth Circuit upheld the settlement on appeal. One or more schools are expected to continue to
 appeal the final approval of the settlement, but Lincoln does not intend to continue participating in the appeal. As a result of this final approval, the DOE has estimated that approximately 196,000 student loan borrowers who attended one of the
 listed schools (including Lincoln institutions) will receive automatic student loan discharges; that another approximately 100,000 student loan borrowers who attended other schools not on the list would receive decisions under new procedures; and
 that approximately 250,000 student loan borrowers who submitted borrower defense applications between June 22, 2022 and November 16, 2022 would receive decisions under the DOE's 2016 regulatory standards within 36 months or else receive automatic
 student loan discharges.

 It is not possible at this time to predict whether the settlement will continue to be upheld on appeal, what additional actions the DOE might take as
 the settlement continues to be upheld on appeal, or whether the DOE or other agencies might take actions against Lincoln institutions. Such actions could have a material adverse effect on our business and results of operations. We believe the
 DOE already may have discharged some or all of the pending applications. See Part I, Item I. "Business – Regulatory Environment – Borrower Defense to Repayment Regulations."

 The DOE's Gainful Employment regulations could have a significant impact on our business and results of operations.

 On October 10, 2023, the DOE published final gainful employment and financial value transparency regulations, which had a general effective date of July 1, 2024 and which establish rules for annually
 evaluating each of our educational programs based on the calculation of debt-to-earnings rates (an annual debt-to-earnings rate and a discretionary debt-to-earnings rate) and an earnings premium measure based on an evaluation of median annual
 earnings under complex regulatory formulas outlined in the regulations. See Part I, Item 1. "Business - Regulatory Environment – Gainful Employment." If one or more of our educational programs were to yield debt-to-earnings rates or an
 earnings premium measure that do not comply with regulatory benchmarks for two of three consecutive years, we would lose Title IV eligibility for each of the impacted educational programs. The regulations will also require us to provide warnings
 to current and prospective students for programs in danger of losing of Title IV eligibility (which could deter prospective students from enrolling and current students from continuing their respective programs). The regulations also include
 provisions for providing certifications and reporting data to the DOE and providing required student disclosures related to gainful employment.

 The regulations include gainful employment rates and measures that will be based in part on data that is not readily accessible to us and other institutions, which make it difficult for us to predict with certainty how our educational programs
 will perform under the new gainful employment benchmarks and the extent to which certain programs could become ineligible for Title IV participation. The DOE released performance data at the time it published the proposed regulations that
 calculates rates for each school's program while acknowledging that the methodology used to produce the calculations differs from the methodology in the proposed regulations due to limitations in data availability. Because we do not have access
 to all of the data that will ultimately be used under the regulations to evaluate our programs and the DOE has not made this data available, we cannot predict whether, or the extent to which, our programs could fail to comply with the new gainful
 employment benchmarks. Moreover, we do not have control over some of the factors that could impact the rates and measures for our programs which will limit our ability to eliminate or mitigate the impact of the regulations on us and our
 educational programs. The DOE announced at the time it released the final gainful employment regulations that the first official outcome rates will be published in early 2025 and that programs that fail the same gainful employment metric in the
 first two years the rates are issued will become ineligible in 2026

 The implementation of new gainful employment regulations could require us to eliminate or modify certain educational programs, could result in the loss of our students' access to Title IV Program funds for the affected programs, and could have
 a significant impact on the rate at which students enroll in our programs and on our business and results of operations.

 The DOE has changed its regulations, and may make other changes in the future, in a manner which could require us to incur additional costs in connection with our administration of Title IV Programs, affect our
 ability to remain eligible to participate in Title IV Programs, impose restrictions on our participation in Title IV Programs, affect the rate at which students enroll in our programs, or otherwise have a significant impact on our business and
 results of operations.

 The DOE periodically issues new regulations and guidance that can have an adverse effect on our institutions. We cannot predict the timing and content of any new regulations or guidance that the DOE may seek to impose or whether and to what
 extent the DOE may issue new regulations and guidance that could adversely impact for-profit schools including our institutions. The DOE recently published new regulations on a variety of topics with a general effective date of July 1, 2024 and
 other regulations with a general effective date of July 1, 2026 and could engage in additional rulemaking processes in the future that could result in new regulations that could adversely impact institutions including our institutions. See Part
 I, Item 1. "Business – Regulatory Environment – Negotiated Rulemaking."

 If we cannot comply with the provisions of these or other regulations, as they currently exist or may be revised, or if the cost of such compliance is excessive, or if funding is materially reduced, our revenues or profit margin could be
 materially adversely affected.

 We cannot predict how the DOE would interpret and enforce current or future regulations or how these regulations, or any regulations that may arise out of a negotiated rulemaking process or any other regulations that DOE may promulgate, may
 impact our schools' participation in Title IV Programs; however, current or future regulations could have a material adverse effect on our schools' business and results of operations, and the broad sweep of the recent rules and the rules that the
 DOE is currently developing may, in the future, require our schools to submit a letter of credit based on expanded standards of financial responsibility.

 If we or our eligible institutions do not meet the financial responsibility standards prescribed by the DOE, we may be required to post letters of credit or our eligibility to participate in Title IV Programs could
 be terminated or limited, which could significantly reduce our student population and revenues.

 To participate in Title IV Programs, an eligible institution must satisfy specific measures of financial responsibility prescribed by the DOE or post a letter of credit in favor of the DOE and possibly accept other conditions on its
 participation in Title IV Programs. The DOE published new regulations that established expanded standards of financial responsibility, which could result in a requirement that we submit to the DOE a substantial letter of credit or other form of
 financial protection in an amount determined by the DOE, and be subject to other conditions and requirements, based on any one of an extensive list of triggering circumstances. See Part I, Item 1. "Business - Regulatory Environment – Financial
 Responsibility Standards." Any obligation to post one or more letters of credit would increase our costs of regulatory compliance. Our inability to obtain a required letter of credit or limitations on, or termination or revocation of, our
 participation in Title IV Programs could limit our students' access to various government-sponsored student financial aid programs, which could significantly reduce our student population and revenues.

 We are subject to fines and other sanctions if we make incentive payments to individuals involved in certain recruiting, admissions or financial aid activities, which could increase our cost of regulatory compliance
 and adversely affect our results of operations.

 An institution participating in Title IV Programs may not provide any commission, bonus or other incentive payment based directly or indirectly on success in enrolling students or securing financial aid to any person involved in any student
 recruiting or admission activities or in making decisions regarding the awarding of Title IV Program funds. See Part I, Item 1. "Business - Regulatory Environment -- Restrictions on Payment of Commissions, Bonuses and Other Incentive Payments."
 We cannot predict how the DOE will interpret and enforce the incentive compensation rule and the limited published guidance that the DOE has provided, nor how it will apply the rule and guidance to our past, present, and future compensation
 practices. These regulations have had and may continue to have a significant impact on the rate at which students enroll in our programs and on our business and results of operations. If we are found to have violated this law, we could be fined
 or otherwise sanctioned by the DOE or we could face litigation filed under the qui tam provisions of the Federal False Claims Act.

 If our schools do not maintain their state licensure and accreditation, they may not participate in Title IV Programs, which could adversely affect our student population and revenues.

 An institution must be accredited by an accrediting commission recognized by the DOE and by applicable state educational agencies in order to participate in Title IV Programs. See Part I, Item 1. "Business - Regulatory Environment – State
 Authorization" and "Business – Regulatory Environment – Accreditation." If any of our schools fail to comply with accrediting or state requirements, the institution and its main and/or branch campuses are subject to the loss of accreditation or
 state authorization or may be placed on probation or a special monitoring or reporting status which, if the noncompliance with accrediting commission requirements is not resolved, could result in loss of accreditation. If the DOE declines to
 continue its recognition of ACCSC in the future and if the subsequent period for obtaining accreditation from another DOE-recognized accrediting agency lapses before we obtain accreditation from another DOE-recognized accrediting agency (or if
 the DOE does not provide such a period for institutions to obtain other accreditation), our schools could lose their Title IV eligibility. Loss of accreditation by any of our main campuses would result in the termination of that school's
 eligibility and all of its branch campuses to participate in Title IV Programs and could cause us to close the school and its branches, which could have a significant adverse impact on our business and operations.

 Programmatic accreditation is the process through which specific programs are reviewed and approved by industry- and program-specific accrediting entities. Although programmatic accreditation is not generally necessary for Title IV Program
 eligibility, such accreditation may be required to allow students to sit for certain licensure exams or to work in a particular profession or career or to meet other requirements. Failure to obtain or maintain such programmatic accreditation may
 lead to a decline in enrollments in such programs.

 Our institutions would lose eligibility to participate in Title IV Programs if the percentage of their revenues derived from those programs exceeds 90%, which could reduce our student population and revenues.

 A proprietary institution that derives more than 90% of its total revenue from Title IV Programs for two consecutive fiscal years becomes immediately ineligible to participate in Title IV Programs and may not reapply for eligibility until the
 end of at least two fiscal years. An institution with revenues exceeding 90% for a single fiscal year will be placed in provisional certification status and may be subject to other enforcement measures.

 In March 2021, the ARPA amended the 90/10 Rule by treating other "federal funds that are disbursed or delivered to or on behalf of a student to be used to attend such institution" in the same way as Title IV funds are currently treated in the
 90/10 Rule calculation. See Part I, Item 1. "Business – Regulatory Environment – 90/10 Rule." The ARPA states that the amendments to the 90/10 Rule apply to institutional fiscal years beginning on or after January 1, 2023 and are subject to the
 HEA's negotiated rulemaking process. The DOE published new final 90/10 Rule regulations on October 28, 2022 with a general effective date of July 1, 2023. The 90/10 Rule regulations could have a materially adverse effect on us and other schools
 like ours. See Part I, Item 1. "Business – Regulatory Environment – 90/10 Rule" and "Business – Regulatory Environment – Negotiated Rulemaking." We cannot be certain that the changes we make to our operations in the future to address the new
 90/10 Rule regulations will succeed in maintaining our institutions' 90/10 Rule percentages below required levels or that the changes will not materially impact our business operations, revenues, and operating costs. It also is

 possible that Congress or the DOE could amend the 90/10 Rule in the future to lower the 90% threshold, change the calculation methodology, or make other changes to the 90/10 Rule that could make it more difficult for our institutions to comply
 with the 90/10 Rule. If any of our institutions loses eligibility to participate in Title IV Programs, that loss would also adversely affect our students' access to various government-sponsored student financial aid programs, and would have a
 significant impact on the rate at which our students enroll in our programs and on our business and results of operations.

 Our institutions would lose eligibility to participate in Title IV Programs if their former students defaulted on repayment of their federal student loans in excess of specified levels, which could reduce our student
 population and revenues.

 An institution may lose its eligibility to participate in some or all Title IV Programs if the rates at which the institution's current and former students default on their federal student loans exceed specified percentages. See Part I, Item
 1. "Business - Regulatory Environment – Student Loan Defaults." If former students defaulted on repayment of their federal student loans in excess of specified levels, our institutions would lose eligibility to participate in Title IV Programs,
 would also adversely affect our students' access to various government-sponsored student financial aid programs, and would have a significant impact on the rate at which our students enroll in our programs and on our business and results of
 operations.

 We are subject to sanctions if we fail to correctly calculate and timely return Title IV Program funds for students who withdraw before completing their educational programs, which could increase our cost of
 regulatory compliance and decrease our profit margin.

 An institution participating in Title IV Programs must correctly calculate the amount of unearned Title IV Program funds that have been credited to students who withdraw from their educational programs before completing them and must return
 those unearned funds in a timely manner, generally within 45 days of such student's withdrawal. If the unearned funds are not properly calculated and timely returned, we may have to post a letter of credit in favor of the DOE or may be otherwise
 sanctioned by the DOE, which could increase our cost of regulatory compliance and adversely affect our results of operations. Based upon the findings of an annual Title IV Program compliance audit of our Columbia and Iselin institutions, we are
 required to maintain a letter of credit in the amount of $600,020 to the DOE. More recently, on January 3, 2025, the DOE issued amendments to the regulations on the requirements for institutions to return unearned Title IV funds to students who
 withdraw from their educational programs before completing them. See Part I, Item 1. "Business - Regulatory Environment – Return of Title IV Program Funds."

 We are subject to sanctions if we fail to comply with the DOE's regulations regarding prohibitions against substantial misrepresentations, which could increase our cost of regulatory compliance and decrease our
 profit margin.

 The DOE's regulations prohibit an institution that participates in the Title IV Programs from engaging in substantial misrepresentation of the nature of its educational programs, financial charges, graduate employability or its relationship
 with the DOE. The DOE published final regulations on November 1, 2022 that, among other things, expanded the categories of conduct deemed to be a misrepresentation or substantial omission of fact and that also
 established new prohibitions on certain types of recruiting tactics and conduct that the DOE deems to be aggressive or deceptive. See Part I, Item 1. "Business - Regulatory Environment – Substantial Misrepresentation." If the DOE
 determines that one of our institutions has engaged in substantial misrepresentation or other prohibited conduct, the DOE may impose sanctions or other conditions upon the institution including, but not limited to, initiating an action to fine
 the institution or limit, suspend, or terminate its eligibility to participate in Title IV Programs and may seek to discharge students' loans and impose liabilities upon the institution. The regulations also could result in further scrutiny of
 marketing and recruiting practices by institutions like our schools and could increase the chances of the DOE finding practices to be noncompliant and imposing sanctions based on the alleged noncompliance.

 All of our institutions are provisionally certified by the DOE, which may make them more vulnerable to unfavorable DOE action and place additional regulatory burdens on its operations.

 All of our institutions are provisionally certified by the DOE. See Part I, Item 1. "Business - Regulatory Environment – Regulation of Federal Student Financial Aid Programs." The DOE typically places an institution in provisional
 certification status following a change in ownership resulting in a change of control, and may provisionally certify an institution for other reasons including, but not limited to, failure to comply with certain standards of administrative
 capability or financial responsibility. During the time when an institution is provisionally certified, it may be subject to adverse action with fewer due process rights than those afforded to other institutions. In addition, an institution that
 is provisionally certified must apply for and receive approval from the DOE for certain substantive changes including, but not limited to, the establishment of an additional location, an increase in the level of academic offerings or the addition
 of new programs. The DOE published final regulations with a general effective date of July 1, 2024 that, among other issues, establish rules to authorize additional conditions and restrictions on provisionally certified institutions and expand
 existing regulations regarding administrative capability and financial responsibility. See Part I, Item 1. "Business – Regulatory Environment – Regulation of Federal Student Financial Aid Programs." Any adverse action by the DOE or increased
 regulatory burdens as a result of the provisional certification status of one of our institutions could have a material adverse effect on enrollments and our revenues, financial condition, cash flows and results of operations.

 Regulatory agencies or third parties may conduct compliance reviews, bring claims or initiate litigation against us. If the results of these reviews or claims are unfavorable to us, our results of operations and
 financial condition could be adversely affected.

 Because we operate in a highly regulated industry, we are subject to compliance reviews and claims of noncompliance and lawsuits by government agencies and third parties. We may be subject to further reviews related to, among other things,
 issues of noncompliance identified in recent audits and reviews related to our institutions' compliance with Title IV Program requirements or related to liabilities for the discharge of loans to certain students who attended campuses of our
 institutions that are now closed. See Part I, Item 1. "Business - Regulatory Environment – Compliance with Regulatory Standards and Effect of Regulatory Violations." If the results of these reviews or proceedings are unfavorable to us, or if we
 are unable to defend successfully against third-party lawsuits or claims, we may be required to pay money damages or be subject to fines, limitations on the operations of our business, loss of federal and state funding, injunctions or other
 penalties. Even if we adequately address issues raised by an agency review or successfully defend a third-party lawsuit or claim, we may have to divert significant financial and management resources from our ongoing business operations to address
 issues raised by those reviews or defend those lawsuits or claims. Certain of our institutions are subject to ongoing reviews and proceedings. See Part I, Item 1. "Business – Regulatory Environment – Accreditation," "Regulatory Environment –
 Other Financial Assistance Programs," "Regulatory Environment – Borrower Defense to Repayment," "Regulatory Environment - Compliance with Regulatory Standards and Effect of Regulatory Violations," and "Regulatory Environment - Scrutiny of the For-Profit Postsecondary Education Sector."

 Our business could be adversely impacted by additional legislation, regulations, or investigations regarding private student lending because students attending our schools rely on private student loans to pay tuition
 and other institutional charges.

 Our private education loans are subject to regulation and oversight by federal and state regulatory agencies. The CFPB has exercised supervisory authority over private education loan providers. The CFPB has initiated investigations into the
 lending practices of institutions in the for-profit education sector. Any adverse legislation, regulations, or investigations regarding private student lending could limit the availability of private student loans to our students or lead to
 sanctions or liabilities, which could have a significant impact on our business and operations.

 Changes in the executive branch of our federal government as a result of the outcome of elections or other events could result in further legislation, appropriations, executive orders, regulations and enforcement
 actions that could materially or adversely affect our business.

 Our industry is subject to an intensive ongoing federal and state regulatory environment that affects our industry. The composition of federal and state executive offices, executive agencies and legislatures that are subject to change based on
 the results of elections, appointments and other events, may adversely impact our industry through constant changes in that regulatory environment resulting from the disparate views towards the for-profit education industry. See Part I, Item 1.
 "Business – Regulatory Environment – Scrutiny of the For-Profit Postsecondary Education Sector." Any laws or other actions that are adopted that limit our or our students' participation in Title IV Programs or in programs to provide funds for
 active duty service members and veterans or the amount of student financial aid for which our students are eligible, or any decreases in enrollment related to the congressional activity concerning this sector, could have a material adverse effect
 on our academic or operational initiatives, cash flows, results of operations, or financial condition.

 Adverse publicity arising from scrutiny of us or other for-profit postsecondary schools may negatively affect us or our schools.

 In recent years, Congress, the DOE, state legislatures, accrediting agencies, the CFPB, the FTC, state attorneys general and the media have scrutinized the for-profit postsecondary education sector. See Part I,
 Item 1. "Business – Regulatory Environment – Scrutiny of the For-Profit Postsecondary Education Sector." Adverse publicity regarding any past, pending, or future investigations, claims, settlements, and/or actions against us or other
 for-profit postsecondary schools could negatively affect our reputation, student enrollment levels, revenue, profit, and/or the market price of our Common Stock. Unresolved investigations, claims, and actions, or adverse resolutions or
 settlements thereof, could also result in additional inquiries, administrative actions or lawsuits, increased scrutiny, the loss or withholding of accreditation, state licensure, or eligibility to participate in the Title IV Programs or other
 financial assistance programs, and/or the imposition of other sanctions by federal, state, or accrediting agencies which, individually or in the aggregate, could have a material adverse effect on our business, financial condition, results of
 operations, and cash flows and result in the imposition of significant restrictions on us and our ability to operate.

 If regulators deny, delay, or condition their approval of transactions involving a change of ownership or control of us or of institutions that we own or acquire, it could have a significant impact on our business
 and results of operations.

 When a company acquires a school that is eligible to participate in Title IV Programs, that school undergoes a change of ownership and control that generally requires approval of the DOE and applicable accrediting and
 state authorizing agencies to continue to operate and participate in Title IV Programs. See Part I, Item 1. "Business - Regulatory Environment - School Acquisitions/Change of Control." Thus, any plans to expand our business through acquisition
 of additional schools and have them certified by the DOE to participate in Title IV Programs must take into account the approval requirements of the DOE and the relevant state education agencies and accrediting commissions.

 In addition, a change of control could occur as a result of future transactions in which the Company or our schools are involved and require our schools to obtain approval of the DOE, ACCSC, and the applicable state authorizing agencies to
 continue operating and participating in Title IV Programs. The DOE, most state education agencies and our accrediting commissions have standards pertaining to the change of control of schools, but these standards are not uniform. DOE regulations
 describe some transactions that constitute a change of control, including the transfer of a controlling interest in the voting stock of an institution or the institution's parent corporation. Examples of such transactions include but are not
 limited to a significant purchase or disposition of stock, some corporate reorganizations, and some changes in the Board of Directors of the Company. See Part I, Item 1. "Business - Regulatory Environment - School

 Acquisitions/Change of Control. " The potential adverse effects of a change of control could influence future decisions by us and our shareholders regarding the sale, purchase, transfer, issuance or redemption of our stock. In addition,
 the adverse regulatory effect of a change of control also could discourage bids for shares of our Common Stock and could have an adverse effect on the market price of our shares. The failure to obtain applicable approvals from the DOE and other
 applicable regulators without delay or material condition in connection with the acquisition of a school or with a change of ownership or control of us or our schools could have a significant impact on our business and results of operations.

 If regulators deny, delay, or condition their approval of new locations and educational programs at our schools, it could have a significant impact on our business and results of operations.

 Our strategic plans for future expansion are based, in part, on our ability to open new schools as additional locations of our existing institutions, to add new educational programs at our existing schools, and take
 into account the applicable approval requirements of the DOE and our other regulatory agencies for adding new locations and educational programs. See Part I, Item 1. "Business - Regulatory Environment - Opening Additional Schools and Adding
 Educational Programs". Our institutions are provisionally certified and required to obtain prior DOE approval of new locations and of new educational programs. If an institution
 erroneously determines that an educational program is eligible for purposes of Title IV Programs, the institution would likely be liable for repayment of Title IV Program funds provided to students in that educational program. The failure to
 obtain applicable approvals from the DOE and other applicable regulators without delay or material condition in connection with the addition of a new location or educational program could have a significant impact on our business and results of
 operations.

 Public health pandemics, epidemics or outbreaks, such as the COVID-19 pandemic, could have a material adverse effect on our business and operations.

 Public health pandemics, epidemics or outbreaks, such as the COVID-19 pandemic, and the resulting containment measures to be taken in response to such events have caused and may in the future cause economic and financial disruptions globally.
 The extent to which any rapidly spreading contagious illness may impact our business and operations will depend on a variety of factors beyond our control, including the actions of governments, businesses and other enterprises in response
 thereto, the effectiveness of those actions, and vaccine availability, distribution and adoption, all of which cannot be predicted with any level of certainty. We believe that the spread of such illnesses could adversely impact our business and
 operations, including as a result of workforce limitations and travel restrictions and related government actions. If a significant percentage of our workforce is unable to work, including because of illness or travel or government restrictions
 in connection with pandemics or disease outbreaks, our operations and enrollment may be negatively impacted. Finally, state and federal regulators, including the DOE, are augmenting existing regulatory processes, waiving others, and overseeing
 various emergency relief and aid programs. It is highly uncertain how long such regulatory accommodations will continue, or how long and in what amount emergency relief and aid funds will continue to be available. We also cannot predict the types
 of conditions that may be attached to participation in emergency relief and aid programs, and whether and to what extent compliance with such conditions will be monitored and enforced. If further outbreaks occur and students elect to take a
 leave of absence, withdraw, or do not make up the required in person labs on a timely basis, our future revenues could be impacted.

 RISKS RELATED TO OUR BUSINESS

 Our success depends in part on our ability to update and expand the content of existing programs and develop new programs in a cost-effective manner and on a timely basis.

 Prospective employers of our graduates increasingly demand that their entry-level employees possess appropriate technological skills. These skills are becoming more sophisticated in line with technological
 advancements in the automotive, diesel, information technology, and skilled trades. Accordingly, educational programs at our schools must keep pace with those technological advancements. The expansion of our existing programs and the development
 of new programs may not be accepted by our students, prospective employers or the technical education market. Even if we are able to develop acceptable new programs, we may not be able to introduce these new programs as quickly as our students
 require or as competitors or employers demand. If we are unable to adequately respond to changes in market requirements due to financial or regulatory constraints, unusually rapid technological changes or other factors, our ability to attract and
 retain students could be impaired, our placement rates could suffer and our revenues could be adversely affected. In addition, if we are unable to adequately anticipate the requirements of the employers we serve, we may offer programs that do
 not teach skills useful to prospective employers, which could affect our placement rates and our ability to attract and retain students, causing our revenues to be adversely affected.

 Competition could decrease our market share and cause us to lower our tuition rates.

 The postsecondary education market is highly competitive. We compete for students and faculty with traditional public and private two-year and four-year colleges and universities and other proprietary schools, many of
 which have greater financial resources than we do. Some traditional public and private colleges and universities, as well as other private career-oriented schools, offer programs that may be perceived by students to be similar to ours. Most
 public institutions are able to charge lower tuition than our schools, due in part to government subsidies and other financial resources not available to for-profit schools. Some of our competitors also have substantially greater financial and
 other resources than we have which may, among other things, allow our competitors to secure strategic relationships with some or all of the companies with which we have existing relationships or develop other high profile strategic relationships,
 or devote more resources to expanding their programs and their school network, or provide greater financing alternatives to their students, all of which could affect the success of our marketing programs. In addition, some of our competitors have
 a larger network of schools and campuses than we do, enabling them to recruit students more effectively from a wider geographic area. This strong competition could adversely affect our business.

 We may be required to reduce tuition or increase spending in response to competition in order to retain or attract students or pursue new market opportunities. As a result, our market share, revenues and operating
 margin may be decreased. We cannot be sure that we will be able to compete successfully against current or future competitors or that the competitive pressures we face will not adversely affect our revenues and profitability.

 Our financial performance depends in part on our ability to continue to develop awareness and acceptance of our programs among high school graduates and working adults looking to return to school.

 The awareness of our programs among high school graduates and working adults looking to return to school is critical to the continued acceptance and growth of our programs. Our inability to continue to develop awareness
 of our programs could reduce our enrollments and impair our ability to increase our revenues or maintain profitability. The following are some of the factors that could prevent us from successfully marketing our programs:

 •

 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.

 An increase in interest rates could adversely affect our ability to attract and retain students.

 Our students and their families have benefitted from historic lows on student loan interest rates in prior years. Much of the financing our students receive is tied to floating interest rates. Recently, student loan
 interest rates have been higher, making borrowing for education more expensive. Increases in interest rates result in a corresponding increase in the cost to our existing and prospective students of financing their education, which could result
 in a reduction in the number of students attending our schools and could adversely affect our results of operations and revenues. Higher interest rates could also contribute to higher default rates with respect to our students' repayment of their
 educational loans. Higher default rates may in turn adversely impact our eligibility for Title IV Program participation or the willingness of private lenders to make private loan programs available to students who attend our schools, which could
 result in a reduction in our student population.

 A substantial decrease in student financing options, or a significant increase in financing costs for our students, could have a significant impact on our student population, revenues and financial results.

 The consumer credit markets in the United States have recently suffered from increases in default rates and foreclosures on mortgages. Adverse market conditions for consumer and federally guaranteed student loans could result in providers of
 alternative loans reducing the attractiveness and/or decreasing the availability of alternative loans to postsecondary students, including students with low credit scores who would not otherwise be eligible for credit-based alternative loans.
 Prospective students may find that these increased financing costs make borrowing prohibitively expensive and abandon or delay enrollment in postsecondary education programs. Private lenders could also require that we pay them new or increased
 fees in order to provide alternative loans to prospective students. If any of these scenarios were to occur, our students' ability to finance their education could be adversely affected and our student population could decrease, which could have
 a significant impact on our financial condition, results of operations and cash flows.

 In addition, any actions by the U.S. Congress or by states that significantly reduce funding for Title IV Programs or other student financial assistance programs, or the ability of our students to participate in these programs, or establish
 different or more stringent requirements for our schools to participate in those programs, could have a significant impact on our student population, results of operations and cash flows.

 We cannot predict our future capital needs, and if we are unable to secure additional financing when needed, our operations and revenues would be adversely affected.

 We may need to raise additional capital in the future to fund acquisitions, working capital requirements, expand our markets and program offerings or respond to competitive pressures or perceived opportunities. We
 cannot be sure that additional financing will be available to us on favorable terms, or at all. If adequate funds are unavailable when required or on acceptable terms, we may be forced to forego attractive acquisition opportunities, or cease
 operations. Even if we are able to continue our operations, our ability to increase student enrollment and revenues would be adversely affected.

 We may not be able to retain our key personnel or hire and retain the personnel we need to sustain and grow our business.

 Our success has depended, and will continue to depend, largely on the skills, efforts and motivation of our executive officers who generally have significant experience within the postsecondary education industry. Our
 success also depends in large part upon our ability to attract and retain highly qualified faculty, school directors, administrators and corporate management. Due to the nature of our business, we face significant competition in the attraction
 and retention of personnel who possess the skill sets that we seek. In addition, key personnel may leave us and subsequently compete against us. Furthermore, we do not currently carry "key man" life insurance on any of our employees. The loss of
 the services of any of our key personnel, or our failure to attract and retain other qualified and experienced personnel on acceptable terms, could have an adverse effect on our ability to operate our business efficiently and to execute our
 growth strategy.

 Our total assets include goodwill. In the event that our schools do not achieve satisfactory operating results, we may be required to write-off a significant portion of the goodwill which would
 negatively affect our results of operations.

 Our total assets reflect amounts for goodwill. At December 31, 2024, goodwill associated with our acquisitions decreased to approximately 2.5% from 3.1% of total assets at December 31, 2023. On at least an annual
 basis, we assess whether there has been an impairment in the value of goodwill. If the carrying value of the tested asset exceeds its estimated fair value, impairment is deemed to have occurred. In this event, the amount is written down to fair
 value. Under current accounting rules, this would result in a charge to operating earnings. Any determination requiring the write-off of goodwill would negatively affect our results of operations and total capitalization, which could be
 material. See Part II. Item 8. "Financial Statements and Supplemental Data - Notes to Consolidated Financial Statements – Note 7 Goodwill."

 Strikes by our employees may disrupt our ability to hold classes as well as our ability to attract and retain students, which could materially adversely affect our operations. In addition, we
 contribute to multiemployer benefit plans that could result in liabilities to us if these plans are terminated or we withdraw from them.

 As of December 31, 2024, the teaching professionals at seven of our campuses are represented by unions and covered by collective bargaining agreements that expire between 2025 and 2027. The faculty of the
 Company's Union, New Jersey campus voted to be represented through collective bargaining in 2024. Although we believe that we have good relationships with these unions and with our employees, any strikes or work stoppages by our employees could
 adversely impact our relationships with our students, hinder our ability to conduct business and increase costs.

 We also contribute to multiemployer pension plans for some employees covered by collective bargaining agreements. These plans are not administered by us, and contributions are determined in accordance with
 provisions of negotiated labor contracts. The Employee Retirement Income Security Act of 1974, as amended by the Multiemployer Pension Plan Amendments Act of 1980, imposes certain liabilities upon employers who are contributors to a
 multiemployer plan in the event of the employer's withdrawal from, or upon termination of, such plan. We do not routinely review information on the net assets and actuarial present value of the multiemployer pension plans' unfunded vested
 benefits allocable to us, if any, and we are not presently aware of any material amounts for which we may be contingently liable if we were to withdraw from any of these plans. In addition, if any of these multiemployer plans enters "critical
 status" under the Pension Protection Act of 2006, we could be required to make significant additional contributions to those plans.

 System disruptions to our technology infrastructure could impact our ability to generate revenue and could damage the reputation of our institutions.

 The performance and reliability of our technology infrastructure is critical to our reputation and to our ability to attract and retain students. We license the software and related hosting and maintenance
 services for our online platform and our student information system from third-party software providers. Any system error or failure, or a sudden and significant increase in bandwidth usage, could result in the unavailability of systems to us
 or our students or result in delays and/or errors in processing student financial aid and related disbursements. Any such system disruptions could impact our ability to generate revenue and affect our ability to access information about our
 students and could also damage the reputation of our institutions. Any of the cyberattacks, breaches or other disruptions or damage described above could interrupt our operations, result in theft of our and our students' data or result
 in legal claims and proceedings, liability and penalties under privacy laws and increased cost for security and remediation, each of which could adversely affect our business and financial results. We may be
 required to expend significant resources to protect against system errors, failures or disruptions or to repair problems caused by any actual errors, disruptions or failures.

 We are subject to privacy and information security laws and regulations due to our collection and use of personal information, and any violations of those laws or regulations, or any breach, theft or loss of that
 information, could adversely affect our reputation and operations.

 Our efforts to attract and enroll students result in the Company collecting, using and storing substantial amounts of personal information regarding applicants, our students, their families and alumni, including social security numbers and
 financial data. We also maintain personal information about our employees in the ordinary course of our activities. Our services, the services of many of our health plan and benefit plan vendors, and other information can be accessed globally
 through the internet. We rely extensively on our network of interconnected applications and databases for day to day operations as well as financial reporting and the processing of financial transactions. Our computer networks and those of our
 vendors that manage confidential information for us or provide services to our students may be vulnerable to computer hackers, organized cyberattacks and physical or electronic breaches or unauthorized access, acts of vandalism, ransomware,
 software viruses and other similar types of malicious activities. Regular patching of our computer systems and frequent updates to our virus detection and prevention software with the latest virus and malware signatures may not catch newly
 introduced malware and viruses or "zero-day" viruses, prior to their infecting our systems and potentially disrupting our data integrity, taking sensitive information or affecting financial transactions. While we utilize security and business
 controls to limit access to and use of personal information, any breach of student or employee privacy or errors in storing, using or transmitting personal information could violate privacy laws and regulations resulting in fines or other
 penalties. A wide range of high-profile data breaches in recent years has led to renewed interest in federal data and cybersecurity legislation that could increase our costs and/or require changes in our operating procedures or systems. A breach,
 theft or loss of personal information held by us or our vendors, or a violation of the laws and regulations governing privacy could have a material adverse effect on our reputation or result in lawsuits, additional regulation, remediation and
 compliance costs or investments in additional security systems to protect our computer networks, the costs of which may be substantial. We cannot assure you that a breach, loss, or theft of personal information will not occur.

 Changes in U.S. tax laws or adverse outcomes from examination of our tax returns could have an adverse effect upon our financial results.

 We are subject to income tax requirements in various jurisdictions in the United States. Legislation or other changes in the tax laws of the jurisdictions where we do business could increase our liability and adversely affect our after-tax
 profitability. In addition, we are subject to examination of our income tax returns by the Internal Revenue Service and the taxing authorities of various states. We regularly assess the likelihood of adverse outcomes resulting from tax
 examinations to determine the adequacy of our provision for income taxes and we have accrued tax and related interest for potential adjustments to tax liabilities for prior years. However, there can be no assurance that the outcomes from these
 tax examinations will not have a material effect, either positive or negative, on our business, financial conditions and results of operations.

 The occurrence of natural or man-made catastrophes, including those caused by climate change and other climate-related causes, could materially and adversely affect our business, financial condition,
 results of operations and prospects.

 All of our campuses are located at leased premises in various areas some of which can experience hurricanes, severe storms, floods, coastal storms, tornadoes, power outages and other severe weather events. If these
 events were to occur and cause damage to our campus facilities, or limit the ability of our students or faculty to participate in or contribute to our academic programs or our ability to comply with federal and state educational requirements, our
 business may be adversely affected. Disruptions of this kind may also result in increases in student attrition, voluntary or mandatory closure of some or all of our facilities, or our inability to procure essential supplies or travel during the
 pendency of mandated travel restrictions. We may not be able to effectively shift our operations due to disruptions arising from the occurrence of such events, and our business and results of operations could be affected adversely as a result.
 Moreover, damage to or total destruction of our campus facilities from various weather events may not be covered in whole or in part by any insurance we may have.

 Our success depends, in part, on the effectiveness of our marketing and advertising programs in recruiting new students.

 Maintaining our revenues and margins and further increasing them requires us to continue to develop our admissions programs and attract new students in a cost-effective manner. The scope and focus of our marketing and
 advertising efforts and the strategies used are determined by, among other factors, the specific geographic markets, regulatory compliance requirements and the nature of each institution and its students. If we are unable to advertise and market
 our institutions and programs successfully, our ability to attract and enroll new students could be materially adversely affected and, consequently, our financial performance could suffer. We use marketing tools such as the internet, radio,
 television and print media advertising to promote our institutions and programs. Our representatives also make presentations at high schools and career fairs. Additionally, we rely on the general reputation of our institutions and referrals from
 current students, alumni and employers as a source of new enrollment. As part of our marketing and advertising, we also subscribe to lead-generating databases in certain markets, the cost of which may increase. Among the factors that could
 prevent us from marketing and advertising our institutions and programs successfully are the failure of our marketing tools and strategies to appeal to prospective students, regulatory constraints on marketing, current student and/or employer
 dissatisfaction with our program offerings or results and diminished access to high school campuses and military bases. In order to maintain our growth, we will need to attract a larger percentage of students in existing markets and increase our
 addressable market by adding locations in new markets and rolling out new academic programs. Any failure to accomplish this may have a material adverse effect on our future growth.

 Our business could be negatively impacted by cybersecurity and other security threats or disruptions.

 Like other companies in our industry, the performance and reliability of our computer networks is essential to our existing operations, our ability to attract and retain students and our reputation. And, like all
 companies that utilize technology, we face significant cybersecurity and other security threats that include, among other things, attempts to gain unauthorized access to sensitive student and employee information; attempts to compromise the
 integrity, confidentiality and/or availability of our systems, hardware and networks, and the information on them; insider threats; malware; ransomware; threats to the safety of our directors, officers and employees; and threats to our
 facilities, infrastructure and services. We are also subject to increasing government, student information and cybersecurity and other security requirements, including disclosure obligations.

 We continue to invest in the cybersecurity and resiliency of our networks and products and enhance our internal controls and processes, which are designed to help protect our systems and infrastructure, and the
 information they contain. These include timely detection of incidents through monitoring, training, incident response capabilities, and mitigating cybersecurity and other risks to our data, systems and services. However, given the complex,
 continuing and evolving nature of cybersecurity threats and other security threats, including threats from targeting by more advanced and persistent adversaries, these efforts may not be fully effective, particularly against previously unknown
 vulnerabilities that could go undetected for extended periods of time. Successful attacks could lead to losses or misuse of sensitive information or capabilities; theft or corruption of data; harm to personnel, infrastructure or products;
 financial costs and liabilities; protracted disruptions in our operations and performance; as well as damage to our reputation as a provider of educational services.

 Our students and corporate business entities to whom we entrust confidential data, and on whom we rely to provide services, face similar threats and growing requirements, including ones for which others may seek to hold
 us responsible. We depend on our students, suppliers, and other business entities to implement and verify adequate controls and safeguards to protect against and report cybersecurity incidents. If they fail to deter, detect or report
 cybersecurity incidents in a timely manner, we may suffer financial and other harm, including to our information, operations, performance, employees and reputation.

 Additionally, while we maintain insurance against certain losses relating to cybersecurity threats and incidents that we believe to be at adequate levels of coverage, such coverage may not be sufficient to address an
 incident and we may not always be able to obtain adequate insurance to cover our losses.

 We also face threats to our physical security, including to our facilities and the safety and the well-being of our people. These threats could involve terrorism, insider threats, workplace violence, civil unrest,
 natural disasters, damaging weather, or fires, which could adversely affect our company. Such acts could detrimentally impact our ability to perform our operations. We could also incur unanticipated costs to remediate impacts and lost business.
 The occurrence and impact of these various risks are difficult to predict, but one or more of them could have a material adverse effect on our financial position, results of operations and/or cash flows.

 RISKS RELATED TO OUR CAPITAL STRUCTURE

 Anti-takeover provisions in our Amended and Restated Certificate of Incorporation, our Bylaws and New Jersey law could discourage a change of control that our shareholders may favor, which could negatively affect our
 stock price.

 Provisions in our Amended and Restated Certificate of Incorporation and our Bylaws and applicable provisions of the New Jersey Business Corporation Act may make it more difficult and expensive for a third party to acquire control of the
 Company even if a change of control would be beneficial to the interests of our shareholders. These provisions could discourage potential takeover attempts and could adversely affect the market price of our Common Stock. For example, applicable
 provisions of the New Jersey Business Corporation Act may discourage, delay or prevent a change in control by prohibiting us from engaging in a business combination with an interested shareholder for a period of five years after the person
 becomes an interested shareholder. Furthermore, our Amended and Restated Certificate of Incorporation and Bylaws:

 •

 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 shareholders;

 •

 prohibit shareholder action by non-unanimous written consent and otherwise require all shareholder actions to be taken at a meeting of the shareholders;

 •

 establish advance notice requirements for nominating candidates for election to the Board of Directors or for proposing matters that can be acted upon by shareholders at shareholders' 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.

 We can issue shares of Preferred Stock without general shareholder approval, which could adversely affect the rights of common shareholders.

 Our Amended and Restated Certificate of Incorporation permits us to establish the rights, privileges, preferences and restrictions, including voting rights, of future series of our Preferred Stock and to issue such stock without approval from
 our shareholders. The rights of holders of our Common Stock may suffer as a result of the rights granted to holders of Preferred Stock that may be issued in the future. In addition, we could issue Preferred Stock to prevent a change in control of
 our Company, depriving common shareholders of an opportunity to sell their stock at a price in excess of the prevailing market price.

 The trading price of our Common Stock may continue to fluctuate substantially in the future.

 Our stock price may fluctuate significantly as a result of a number of factors, some of which are not in our control. These factors may include:

 •

 general economic conditions;

 •

 general conditions in the for-profit, postsecondary education industry;

 •

 negative media coverage of the for-profit, postsecondary education industry;

 •

 failure of certain of our schools or programs to maintain compliance under the gainful employment regulation, 90/10 Rule or with financial responsibility standards;

 •

 the impact of DOE rulemaking and other changes in the highly regulated environment in which we operate;

 •

 the initiation, pendency or outcome of litigation, accreditation reviews and regulatory reviews, inquiries and investigations;

 •

 loss of key personnel;

 •

 quarterly variations in our operating results;

 •

 our ability to meet or exceed, or changes in, expectations of investors and analysts, or the extent of analyst coverage of us; and decisions by any significant investors to reduce their investment in our Common Stock.

 In addition, the trading volume of our Common Stock is relatively low. This may cause our stock price to react more to these factors and various other factors and may impact an investor's ability to
 sell our Common Stock at the desired time at a price considered satisfactory. Any of these factors may adversely affect the trading price of our Common Stock, regardless of our actual operating performance, and could prevent an investor from
 selling shares of our Common Stock at or above the price at which the investor purchased them.

 ITEM 1B.

 UNRESOLVED STAFF COMMENTS

 None.

 ITEM 1C.

 CYBERSECURITY

 We recognize the critical importance of maintaining the safety and security of our systems and data and we take a holistic approach to the oversight and management of cybersecurity and related risks. This approach is supported by our Board of Directors and management who are actively involved in the oversight of our risk management program.

 Our cybersecurity team, which maintains our cybersecurity function, is comprised of technology and cybersecurity professionals in the information
 technology department, and is led by our Chief Information Officer ("CIO"), who prior to joining the Company has held positions as CIO, Chief Technology Officer ("CTO"), and other key leadership positions in the travel, finance, internet,
 engineering, and pharmaceutical industries. Our CIO is responsible for management of cybersecurity risk and the protection and defense of our networks and systems. The
 cybersecurity team has broad experience and expertise, including cybersecurity threat assessment and detection, mitigation technologies, cybersecurity training, incident response, cyber forensics, insider threats and regulatory compliance.

 Like all companies that utilize technology, we face significant cybersecurity threats that include, among other things, attempts to gain unauthorized access to
 sensitive student and employee information; attempts to compromise the integrity, confidentiality and/or availability of our systems, hardware and networks, and the information on them; insider threats; malware; ransomware; threats to the
 safety of our directors, officers and employees; and threats to our facilities, infrastructure and service. As cybersecurity threats may arise, the cybersecurity team focuses on responding to and containing the threat and minimizing any
 business impact, as appropriate. In the event of a perceived threat or possible cybersecurity incident, the cybersecurity team is trained to assess, among other factors, student safety impact, data and personal information impact, the
 possibility of business operations disruption, projected cost, if any, and potential for reputational harm, with support from external technical, legal and law enforcement support, as appropriate.

 Our Board of Directors, in coordination with our Audit Committee, is responsible for overseeing our enterprise risk management. In connection with such oversight, the Board of Directors receives periodic updates, as appropriate (and no less frequently than annually), from our CIO regarding the Company's cybersecurity risk management processes and the risk trends related to cybersecurity. The Audit
 Committee assists the Board in its oversight of risks, generally and risks related to cybersecurity.

 Our approach to cybersecurity risk management includes the following key elements:

 • Multi-Layered Defense Technology – We work to protect our computing environments and products from cybersecurity threats
 through multi-layered defenses and apply lessons learned from our defense and monitoring efforts to help prevent future attacks. We utilize data analytics to detect anomalies and search for cybersecurity threats.

 • Continuous Monitoring and Analysis – We utilize a third-party Security Operations Center which maintains a 24/7 monitoring system and provides comprehensive cyber threat detection and response capabilities which complements the Lincoln cybersecurity team and leverages the technology, processes and threat detection techniques used to monitor, manage, and mitigate cybersecurity threats. For additional visibility and perspective, we engage with a different third-party security firm for monthly reviews and analysis. From time to time, we engage additional third-party consultants or other advisors to assist in assessing, identifying and/or managing cybersecurity threats including formalized penetration and cybersecurity testing.

 • Third Party Risk Assessments – We conduct information security assessments before sharing or allowing the hosting of sensitive data in computing environments managed by third parties, and our standard contracts contain terms and conditions requiring certain security protections.

 • Training and Awareness – We provide monthly awareness training and testing to help our employees identify, avoid and mitigate
 cybersecurity threats, including spear phishing and other awareness testing.

 • Response Policy – We maintain a data breach response policy defining our incident analysis and response actions. This policy
 describes our initial actions upon learning of an incident, confirmation steps, notification to affected parties if any, risk mitigation planning, and post incident procedures.

 While we have experienced minor cybersecurity threats in the past, such as spear phishing or smishing (SMS phishing), to date no such threats have materially affected the Company or our financial position, results of operations and/or cash flows.

 We continue to invest in the cybersecurity and resiliency of our networks and to enhance our internal controls and processes, which are designed to help protect our
 systems and infrastructure, and the information contained therein.

 We maintain cybersecurity insurance coverage in amounts that we believe are adequate to address any incidents such as data destruction, extortion, theft, hacking,
 denial of service attacks and other such incidents.

 For more information concerning the risks that we face from cybersecurity threats, please see Part I, Item 1A, "Risk Factors".

 ITEM 2.

 PROPERTIES

 As of December 31, 2024, we lease all of our properties. We continue to reevaluate our facilities to maximize our facility utilization and efficiency and to allow us to introduce new programs and attract more
 students. As of December 31, 2024, all of our existing leases expire between 2025 and 2045.

 The following table provides information relating to our facilities as of December 31, 2024, including our corporate office:

 Current Locations

 Brand

 Approximate Square Footage

 Columbia, Maryland

 111,000

 Denver, Colorado

 213,000

 Grand Prairie, Texas

 158,000

 Indianapolis, Indiana

 126,000

 Marietta, Georgia

 30,000

 Melrose Park, Illinois

 88,000

 Allentown, Pennsylvania

 25,000

 East Windsor, Connecticut

 289,000

 Iselin, New Jersey

 32,000

 Lincoln, Rhode Island

 66,000

 Mahwah, New Jersey

 79,000

 Moorestown, New Jersey

 49,000

 New Britain, Connecticut

 36,000

 Paramus, New Jersey

 30,000

 Philadelphia, Pennsylvania

 30,000

 Queens, New York

 50,000

 Shelton, Connecticut

 57,000

 South Plainfield, New Jersey

 60,000

 Union, New Jersey

 56,000

 Nashville, Tennessee

 Nashville Auto Diesel College

 292,000

 East Point, Georgia

 56,000

 Parsippany, New Jersey

 Corporate Office

 17,000

 Future Locations

 Brand

 Approximate Square Footage

 Hicksville, New York 1

 65,000

 Houston, Texas 2

 100,000

 Nashville, Tennessee 3

 Nashville Auto Diesel College

 124,000

 Levitttown, Pennsylania 4

 91,000

 We believe that our facilites are suitable for their intendedn puposes.

 On December 12, 2024, the Company entered into a lease for approximately 65,000 square feet of space to serve as the Company's new campus in Hicksville, New York. The
 lease term is currently planned to commence on or about May 1, 2025, with an initial lease term of 15 years and 9 months. The lease contains a renewal option allowing for either a 10-year renewal or two five-year renewals.

 On October 31, 2023, the Company entered into a lease for approximately 100,000 square feet of space to serve as the Company's new campus in Houston, Texas. The lease
 term commenced on January 2, 2024, with an initial lease term of 21-years and 6 months with three five-year renewal options.

 On October 18, 2023, the Company entered into a lease for approximately 120,000 square feet of space. to serve as the Company's new Nashville, Tennessee campus. The lease
 term commenced on November 1, 2023, with an initial lease term of 15-years with two five-year renewal options.

 On September 28, 2023, the Company purchased a 90,000 square foot property located at 311 Veterans Highway, Levittown, Pennsylvania for approximately $10.2 million and,
 subsequently on January 30, 2024, entered into a sale-leaseback transaction for this property. As of December 31, 2023, this property was classified as held-for-sale on the Consolidated Balance Sheets.

 ITEM 3.

 LEGAL PROCEEDINGS

 On June 22, 2022, the DOE and the plaintiff student loan borrowers in a class action against the DOE initiated on June 25, 2019 in the U.S. District Court for the Northern District of California ( Sweet v. Cardona, No. 3:19-cv-3674 (N.D. Cal.)) announced a proposed settlement agreement to resolve claims that the DOE had failed to timely decide Borrower Defense to Repayment applications submitted to
 the DOE. The proposed settlement included three categories of relief for student loan borrowers. First, the DOE would agree to discharge loans and refund prior loan payments to class members with loan debt associated with an institution on
 the list included in the settlement (which includes Lincoln institutions). The class action plaintiffs and the DOE stated that the DOE had determined that attendance at one of the listed institutions justifies presumptive relief allegedly
 based on strong indicia regarding substantial misconduct by the institutions, whether credibly alleged or in some instances proven, and the purportedly high rate of class members with applications related to the listed schools. Second, the
 proposed settlement included new procedures for the DOE to resolve pending borrower defense claims associated with other schools not on the list. Third, for any student loan borrower who submitted a borrower defense application after June
 22, 2022 and before the final approval of the settlement, the proposed settlement would require the DOE to review the applications under the DOE's 2016 regulatory standards and issue decisions within 36 months, or else the applications would
 be discharged in full. On November 16, 2022, the federal district court approved the settlement as proposed and the DOE began implementing the settlement relief while Lincoln and other parties appealed the settlement's final approval to the
 U.S. Court of Appeals for the Ninth Circuit. On November 5, 2024, the Ninth Circuit upheld the settlement on appeal. One or more schools are expected to continue to appeal the final approval of the settlement, but Lincoln does not intend to
 continue participating in the appeal. As a result of this final approval, the DOE has estimated that approximately 196,000 student loan borrowers who attended one of the listed schools (including Lincoln institutions) will receive automatic
 student loan discharges; that another approximately 100,000 student loan borrowers who attended other schools not on the list would receive decisions under new procedures; and that approximately 250,000 student loan borrowers who submitted
 borrower defense applications between June 22, 2022 and November 16, 2022 would receive decisions under the DOE's 2016 regulatory standards within 36 months or else receive automatic student loan discharges.

 It is not possible at this time to predict whether the settlement will continue to be upheld on appeal, what additional actions the DOE might take as the settlement continues to be upheld on appeal, or whether the
 DOE or other agencies might take actions against Lincoln institutions. Such actions could have a material adverse effect on our business and results of operations. We believe the DOE already may have discharged some or all of the pending
 applications. See Part I, Item I. "Business – Regulatory Environment – Borrower Defense to Repayment Regulations."

 In addition to the foregoing, in the ordinary conduct of our business, we are subject to additional periodic lawsuits, investigations, regulatory proceedings and other claims, including, but not limited to, claims involving students or
 graduates, routine employment matters and business disputes. We cannot predict the ultimate resolution of these lawsuits, investigations, regulatory proceedings and other claims asserted against us, but we do not believe that any of these
 matters will have a material adverse effect on our business, financial condition, results of operations or cash flows.

 ITEM 4.

 MINE SAFETY DISCLOSURES

 Not applicable.

 PART II.

 ITEM 5.

 MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 Market for our Common Stock

 Our Common Stock, no par value per share, is quoted on the Nasdaq Global Select Market under the symbol "LINC".

 On February 26, 2025, the last reported sale price of our Common Stock on the Nasdaq Global Select Market was $18.29 per share.

 Holders

 As of February 26, 2025, based on the information provided by Continental Stock Transfer & Trust Company, there were 42 shareholders of record of our Common Stock.

 Dividend Policy

 The Company has not declared or paid any cash dividends on its Common Stock since the Company's Board of Directors discontinued our quarterly cash dividend program in February 2015. The Company has no current intentions to resume the
 payment of cash dividends on its Common Stock in the foreseeable future.

 During the fiscal year ended December 31, 2022, the Company paid a total of $1.1 million in cash dividends to holders of its Series A Convertible Preferred Stock (the "Series A Preferred Stock") pursuant to the Securities Purchase
 Agreement entered into on November 14, 2019 and the Company's Amended and Restated Certificate of Incorporation.

 On November 30, 2022, the Company exercised in full its right of mandatory conversion of the Company's Series A Preferred Stock. In connection with the conversion, each share of Series A Preferred Stock has been cancelled and converted
 into 423.729 shares of the Company's Common Stock, no par value per share. Shares of the Series A Preferred Stock are no longer outstanding and all rights of the holders to receive future dividends have terminated. As a result of the
 conversion, the aggregate 12,700 shares of Series A Preferred Stock were converted into 5,381,356 shares of Common Stock.

 Equity Compensation Plan Information

 We have various equity compensation plans under which equity securities are authorized for issuance. Information regarding these securities as of December 31, 2024, is as follows:

 Plan Category

 Number of

 Securities to be

 issued upon

 exercise of

 outstanding

 options,

 warrants and

 rights (a)

 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))

 Equity compensation plans approved by security holders

 -

 $

 -

 1,684,587

 Equity compensation plans not approved by security holders

 -

 -

 -

 Total

 -

 $

 -

 1,684,587

 Stock Performance Graph

 This stock performance graph compares our total cumulative stockholder return on our Common Stock for the five years ended December 31, 2024 with the cumulative return on the Russell 2000 Index, S&P 500 and an
 index of peer companies. The companies in the index of peer issuers, which were selected in good faith on the basis of the similar nature of their business as postsecondary educational institutions, include American Public Education, Inc.,
 Adtalem Global Education Inc., Strategic Education, Inc., Universal Technical Institute, Inc., and Perdoceo Education Corporation. The graph assumes that $100 was invested on December 31, 2019 and any dividends were reinvested on the date on
 which they were paid.

 The information provided under the heading "Stock Performance Graph" shall not be considered "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or incorporated by reference
 in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that we specifically incorporate it by reference into a filing.

 Share Repurchases

 On May 24, 2022, the Company announced that the Board of Directors had approved a share repurchase program for 12 months authorizing purchases of up to $30.0 million. On February 27, 2023, the Board of Directors extended the share
 repurchase program for an additional 12 months and authorized the repurchase of an additional $10.0 million of the Company's Common Stock, for an aggregate of up to $30.6 million in additional repurchases. On

 May 7, 2024, the Company announced that its Board of Directors had authorized an extension of its share repurchase program for an additional 12 months through May 24, 2025. During the year ended December 31, 2024, the Company did not
 repurchase any shares.

 The following table presents the number and average price of shares purchased during the three months ended December 31, 2024. The remaining authorized amount for share repurchases under the program at December 31, 2024 was approximately
 $29.7 million.

 Period

 Total Number of

 Shares

 Purchased

 Average Price

 Paid per Share

 Total Number of

 Shares Purchased

 as Part of Publically

 Announced Plan

 Maximum Dollar

 Value of Shares

 Remaining to be

 Purchased Under

 the Plan

 October 1, 2024 to October 31, 2024

 -

 $

 -

 -

 $

 29,663,667

 November 1, 2024 to November 30, 2024

 -

 -

 -

 -

 December 1, 2024 to December 31, 2024

 -

 -

 -

 -

 Total

 -

 -

 -

 For more information on the share repurchase program, See Part II. Item 8. "Financial Statements and Supplemental Data - Notes to Consolidated Financial Statements – Note 12 Stockholders Equity."

 ITEM 6.

 [RESERVED]

 ITEM 7.

 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 You should read the following discussion together with the "Forward-Looking Statements" and the Consolidated Financial Statements and the related notes thereto included elsewhere in this Annual
 Report on Form 10-K. This discussion contains forward-looking statements that are based on management's current expectations, estimates and projections about our business and operations. Our actual results may differ materially from those
 currently anticipated and expressed in such forward-looking statements as a result of a number of factors, including those we discuss under "Risk Factors" and "Forward-Looking Statements" and elsewhere in this Annual Report on Form 10-K.

 GENERAL

 Lincoln Educational Services Corporation and its subsidiaries (collectively, the
 "Company", "we", "our" and "us", as applicable) provide diversified career-oriented postsecondary education to recent high school graduates and working adults. The Company, which currently operates 21 campuses in 12 states, has entered
 into leases for two new campuses: one in Houston, Texas, with programs expected to begin in the second half of 2025, and one in Hicksville, New York, with programs expected to begin by the end of 2026. Lincoln Educational Services
 Corporation offers programs in skilled trades (which include Heating Ventilation and Air Conditioning ("HVAC"), welding and computerized numerical control and electrical and electronic systems technology, among other programs),
 automotive technology, healthcare services (which include nursing, dental assistant and medical assistant, among other programs) and hospitality services and information technology (which include culinary and aesthetics and information
 technology programs). The schools operate under the brands Lincoln Technical Institute, Lincoln College of Technology and Nashville Auto Diesel College.

 Most of the Company's 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 accredited and are eligible to participate in federal financial aid programs
 administered 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. The
 Company was incorporated in New Jersey in 2003 as the successor-in-interest to various acquired schools including Lincoln Technical Institute, Inc. which opened its first campus in Newark, New Jersey in 1946.

 The Company manages its business, evaluates performance and allocates resources based on two reportable business segments, Campus Operations and Transitional:

 Campus Operations - The Campus Operations segment includes campuses that are continuing in operation and contribute to the Company's core operations and performance. All of the campuses
 continuing in operation are classified in this segment. The majority of the campuses offer programs across various areas of study.

 Transitional – The Transitional segment refers to campuses that
 are marked for closure and are currently being taught-out, in addition to campuses that are held-for-sale or sold. As of December 31, 2024, the net assets for the Summerlin, Las Vegas campus were classified as held for sale, with operating
 results classified within the Transitional segment. The sale of the campus was consummated effective January 1, 2025. In addition, the Company closed the Somerville, Massachusetts campus in the prior year. It was fully taught-out as of
 December 31, 2023. This campus is classified in the Transitional segment in the prior year's statement of operations.

 As of December 31, 2024, we had 15,138 students enrolled at 21 campuses. Our average enrollment for the fiscal year ended December 31, 2024 was 14,426 students and our revenues were $440.1 million, which
 represented an increase of 16.4% over the prior fiscal year. For more information relating to our revenues, profits and financial condition, please refer to our Consolidated Financial Statements included in this Annual Report on Form 10-K.

 We believe that we provide our students with the highest quality career-oriented training available for our areas of study in our markets thereby serving students, local employers and their communities. The

 skills gap continues to expand as talent retires faster than new employees are hired and as the need for education and training increases in all careers with the accelerating pace of technological change.

 We offer programs in areas of study that we believe are typically underserved by traditional providers of postsecondary education and for which we believe there exists significant demand among students and
 employers. Furthermore, we believe our convenient class scheduling, career-focused curricula and emphasis on job placement offer our students valuable advantages that have been previously unaddressed by the traditional academic sector. By
 combining virtual training with traditional classroom-based training led by experienced instructors, we believe we offer our students a unique opportunity to develop practical job skills in many of the key areas of expected job demand. We
 believe these job skills enable our students to compete effectively for employment opportunities and to pursue salary and career advancement.

 In the last several years, we have further implemented our plan of improving the student experience by adding program offerings, enhancing existing program offerings and expanding geographically with new state of the art campuses. See Part II. Item 8. "Financial Statements and Supplemental Data - Notes to Consolidated Financial Statements – Note 6 Leases and Note 8 Real Estate Transactions."

 Our revenues consist primarily of student tuition and fees derived from the programs we offer. Our revenues are reduced by scholarships granted by us to some of our students. We recognize revenues from tuition
 and one-time fees, such as application fees, ratably over the length of a program, including internships or externships that take place prior to graduation. We also earn revenues from our bookstores, dormitories, cafeterias and contract
 training services. These non-tuition revenues are recognized upon delivery of goods or as services are performed and represent less than 10% of our revenues.

 Our revenues are directly dependent on the average number of students enrolled in our schools and the courses in which they are enrolled. Our average enrollment is impacted by the number of new students
 starting, re-entering, graduating and withdrawing from our schools. Our diploma/certificate programs range in duration from 27 to 104 weeks, our associate's degree programs range in duration from 69 to 94 weeks, and students attend classes
 for different amounts of time per week depending on the school and program in which they are enrolled. Because we start new students every month, our total student population changes monthly. The number of students enrolling or re-entering
 our programs each month is driven by the demand for our programs, the effectiveness of our marketing and advertising, the availability of financial aid and other sources of funding, the number of recent high school graduates, the job market
 and seasonality. Our retention and graduation rates are influenced by the quality and commitment of our teachers and student services personnel, the effectiveness of our programs, the placement rate and success of our graduates and the
 availability of financial aid and other sources of funding. Although similar courses have comparable tuition rates, the tuition rates vary among our numerous programs.

 The majority of students enrolled at our schools rely on funds received under various government-sponsored student financial aid programs to pay a substantial portion of their tuition and other
 education-related expenses. The largest of these programs are Title IV Programs which represented approximately 82%, 81%, and 74% of our revenue on a cash basis while the remainder is primarily derived from state grants and cash payments
 made by students during fiscal years 2024, 2023, and 2022, respectively. The HEA requires institutions to use the cash basis of accounting when determining its compliance with the 90/10 Rule. See Part I, Item 1. "Business -
 Regulatory Environment."

 We extend credit for tuition and fees to many of our students that attend our campuses. Our credit risk is mitigated by the students' participation in federally funded financial aid programs unless students
 withdraw prior to the receipt by us of Title IV Program funds for those students. Under Title IV Programs, the government funds a certain portion of a student's tuition, with the remainder, referred to as "the gap," financed by the students
 themselves under third party private party loans and once these financial options have been fully exhausted, the Company may offer extended payment plans. The gap amount has continued to increase over the last several years as we have raised
 tuition on average for the last several years by 2-3% per year.

 The additional extension of credit that we are providing to students may expose us to greater credit risk and can impact our liquidity. However, we believe that these risks are somewhat mitigated by the
 following:

 •

 our internal extension of credit 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 and, as a consequence, more likely to pay outstanding tuition amounts;

 •

 funding for students who interrupt their education is typically covered by Title IV Program funds as long as they have been properly packaged for financial aid.

 The operating expenses associated with an existing school do not increase or decrease proportionally as the number of students enrolled at the school increases or decreases. We categorize our operating expenses as:

 •

 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.

 Real Estate Transactions

 Asset Purchase Agreement – Summerlin, Las Vegas

 On November 11, 2024, the Company entered into an agreement with DVMD LLS (IntelliTec College) for the sale of the Summerlin, Las Vegas ("Euphoria") campus. As a result of the intended sale, the Company
 recorded the carrying amount of the net assets totaling $1.2 million as held for sale on the Consolidated Balance Sheets. The net assets related to the Summerlin, Las Vegas campus consisted of $2.1 million in assets and $0.9 million in
 liabilities. The sale of the campus was consummated effective January 1, 2025.

 Purchase and Sale-leaseback Transaction – Philadelphia, Pennsylvania Area Campus

 On September 28, 2023, the Company purchased a 90,000 square foot property located at 311 Veterans Highway, Levittown, Pennsylvania for approximately $10.2 million and subsequently on January 30, 2024 entered
 into a sale-leaseback transaction for the same property. As of December 31, 2023, this property was classified as held-for-sale on the Consolidated Balance Sheets. During the year ended December 31, 2024, the Company has invested
 approximately $11.7 million in capital investments.

 Property Sale Agreement - Nashville, Tennessee Campus

 On September 24, 2021, Nashville Acquisition, L.L.C., a subsidiary of the Company, entered into a Contract for the Purchase of Real Estate (the "Nashville Contract") to sell the nearly
 16-acre property located at 524 Gallatin Avenue, Nashville, Tennessee 37206, at which the Company operates its Nashville campus, to SLC Development, LLC, a subsidiary of Southern Land Company ("SLC").

 On June 8, 2023, the Company closed on the sale of its Nashville, Tennessee property to East Nashville Owner, LLC, an affiliate of SLC, for approximately $33.8 million pursuant to the Nashville Contract. The
 net proceeds from the Nashville sale, net of closing costs, are available for working capital, acquisitions, other strategic initiatives, and general corporate purposes. In connection with the sale, the parties entered into a lease agreement
 allowing Lincoln to continue to occupy the campus and operate it on a rent-free basis for a period of 15 months plus options to extend the lease for up to three consecutive 30-day terms at $150,000 per extension term. The carrying value of
 the campus is approximately $4.5 million and the estimated fair value of the rent for the 15-month rent-free period was approximately $2.3 million at the consummation of the lease. As of December 31, 2024, the total rent free period has been
 fully expensed.

 CRITICAL ACCOUNTING POLICIES AND ESTIMATES

 Our discussions of our financial condition and results of operations are based upon our Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in
 the United States of America, or GAAP. The preparation of financial statements in conformity with 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, we evaluate our estimates and assumptions, including those
 related to revenue recognition, bad debts, goodwill and impairment of long-lived assets and income taxes. Actual results could differ from those estimates. The critical accounting policies discussed herein are not intended to be a
 comprehensive list of all of our accounting policies. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not result in significant management judgment in the application of such
 principles. We believe that the following accounting policies are most critical to us in that they represent the primary areas where financial information is subject to the application of management's estimates, assumptions and judgment in
 the preparation of our Consolidated Financial Statements.

 Revenue recognition. Substantially all of our revenues are considered to be revenues from contracts with students. The related accounts receivable
 balances are recorded in our balance sheets as student accounts receivable. We do not have significant revenue recognized from performance obligations that were satisfied in prior periods, and we do not have any transaction price allocated
 to unsatisfied performance obligations other than in our unearned tuition. We record revenue for students who withdraw from our schools only to the extent that it is probable that a significant reversal in the amount of cumulative revenue
 recognized will not occur. Unearned tuition represents contract liabilities primarily related to our tuition revenue. We have elected not to provide disclosure about transaction prices allocated to unsatisfied performance obligations if
 original contract durations are less than one-year, or if we have the right to consideration from a student in an amount that corresponds directly with the value provided to the student for performance obligations completed to date in
 accordance with Accounting Standards Codification ("ASC") Topic 606, Revenue from Contract with Customers. We have assessed the costs incurred to obtain a contract with a student and determined them
 to be immaterial.

 Allowance for Credit Losses. On January 1, 2023, the Company adopted Accounting Standards Update ("ASU") 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. As a result of the adoption, the Company has revised the way in which it calculates reserves on outstanding student
 accounts receivable balances. Details considered by management in the estimate include the following:

 We extend credit to a portion of the students who are enrolled at our academic institutions for tuition and certain other educational costs. Based upon past experience and judgment, we establish an allowance
 for credit losses with respect to student receivables which we estimate will ultimately not be collectible. Our standard student receivable allowance is based on an estimate of lifetime expected credit losses for student receivables that
 considers vintages of receivables to determine a loss rate. Our estimation methodology considers a number of quantitative and qualitative factors that, based on our collection experience, we believe have an impact on our repayment risk and
 ability to collect student receivables. Changes in the trends in any of these factors may impact our estimate of the allowance for credit losses. These factors include, but are not limited to: internal repayment history, changes in the
 current economic, legislative or regulatory environments, internal cash collection forecasts and the ability to complete the federal financial aid process with the student. These factors are monitored and assessed on a regular basis.
 Overall, our allowance estimation process for student receivables is validated by trending analysis and comparing estimated and actual performance. The Company evaluates its provision for credit losses on at least a quarterly basis,
 considering factors such as micro and macro-economic conditions, the current political climate, and other industry factors.

 Management makes a series of assumptions to determine what is believed to be the appropriate level of allowance for credit losses. Management determines a reasonable and supportable forecast based on the
 expectation of future conditions over a supportable forecast period as described above, as well as qualitative adjustments based on current and future conditions that may not be fully captured in the historical modeling factors described
 above. All of these estimates are susceptible to significant change.

 We monitor our collections and write-off experience to assess whether or not adjustments to our allowance percentage estimates are necessary. Changes in trends in any of the factors that we believe impact the
 collection of our student receivables, as noted above, or modifications to our collection practices, and other related policies may impact our estimate of our allowance for credit losses and our results from operations.

 Because a substantial portion of our revenue is derived from Title IV Programs, any legislative or regulatory action that significantly reduces the funding available under Title IV Programs, or the ability of
 our students or institutions to participate in Title IV Programs, would likely have a material impact on the realizability of our receivables.

 Our bad debt expense as a percentage of revenues for the fiscal years ended December 31, 2024, 2023, and 2022 was 12.9%, 11.0%, and 10.0%, respectively. A 1% increase in our bad debt expense as a percentage of
 revenues for the fiscal years ended December 31, 2024, 2023, and 2022 would have resulted in an increase in bad debt expense of $4.4 million, $3.8 million, and $3.5 million, respectively.

 We do not believe that there is any direct correlation between tuition increases, the credit we extend to students and our financing commitments. The extended financing plans we offer to our students are made
 on a student-by-student basis and are predominantly a function of the specific student's financial condition. We only extend credit to the extent there is a financing gap between the tuition and fees charged for the program and the amount
 of grants, loans and parental loans each student receives. Each student's funding requirements are unique. Factors that determine the amount of aid available to a student include whether they are dependent or independent students, Pell
 Grants awarded, federal Direct Loans awarded, PLUS loans awarded to parents and the student's personal resources and family contributions. As a result, it is extremely difficult to predict the number of students that will need us to extend
 credit to them.

 Because a substantial portion of our revenues is derived from Title IV Programs, any legislative or regulatory action that significantly reduces the funding available under Title IV Programs or the ability of
 our students or schools to participate in Title IV Programs could have a material effect on the realizability of our receivables.

 Goodwill. Goodwill represents the excess of purchase price over the fair value of tangible net assets and identifiable intangible assets of the businesses
 acquired. Lincoln tests goodwill for impairment annually, in the fourth quarter of each year, unless there are events or changes in circumstances that indicate an impairment may have occurred. Impairment may result from deterioration in
 performance, adverse market conditions, adverse changes in laws or regulations, the restriction of activities associated with the acquired business, and/or a variety of other circumstances. If we determine that impairment has occurred, we
 record a write-down of the carrying value and charge the impairment as an operating expense in the period the determination is made.

 As of December 31, 2024, goodwill was approximately $10.7 million, or 2.5%, of our total assets.

 When we perform our annual goodwill impairment assessment we have the option to perform a qualitative assessment based on a number of factors impacting our reporting units (Step 0). When a qualitative assessment is performed, a number of
 factors are evaluated to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. Our qualitative assessment is subjective. It includes a review
 of macroeconomic and industry factors, review of financial and non-financial performance measures, including projected student starts and assessment of adverse events that may negatively impact a reporting units carrying value. Adverse
 events would include, but are not limited to, difficulty in accessing capital, a greater competitive environment, decline in market-dependent multiples or metrics, regulatory or political developments, change in key personnel, strategy, or
 customers, or litigation. If we conclude based on our qualitative review that it is more likely than not that the fair value of the reporting unit is less than the carrying value, we proceed with a quantitative impairment test.

 When we perform our quantitative impairment test we believe the most critical assumptions and estimates in determining the estimated fair value of our reporting units include, but are not limited to, future tuition
 revenues, operating costs, working capital changes, capital expenditures and a discount rate. The assumptions used in determining our expected future cash flows consider various factors such as historical operating trends particularly in
 student enrollment and pricing and long-term operating strategies and initiatives.

 If we determine that quantitative tests are necessary, we determine the fair value of each reporting unit using an equal weighting of the discounted cash flow model and the market approach, or if required, we will
 evaluate other asset value-based approaches. Our judgment is necessary in forecasting future cash flows and operating results, critical assumptions include growth rates, changes in operating costs, capital expenditures, changes in weighted
 average costs of capital, and the fair value of an asset based on the price that would be received in a current transaction to sell the asset. Additionally, we obtain independent market metrics for the industry and our peers to assist in the
 development of these key assumptions. This process is consistent with our internal forecasts and operating plans.

 For the year ended December 31, 2024, there were no impairments related to goodwill.

 On June 8, 2023, the Company consummated the sale of its Nashville, Tennessee property (see Part II. Item 8. "Financial Statements and Supplemental Data" - Notes to Consolidated Financial Statements – Note 8 Real
 Estate Transactions"). The result of the sale created a change in the trajectory of the fair value of the Nashville, Tennessee operations and as such, the Company recorded a pre-tax non-cash impairment charge of $3.8 million relating to
 goodwill.

 During the year ended December 31, 2022, there were no impairments related to goodwill.

 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. For other long-lived assets, including right-of-use ("ROU") lease assets, the Company evaluates assets
 for recoverability when there is an indication of potential impairment. Factors the Company considers important, which could trigger an impairment review, include significant changes in the manner of the use of the asset, significant changes
 in historical trends in operating performance, significant changes in projected operating performance, and significant negative economic trends. If the undiscounted cash flows from a group of assets being evaluated is less than the carrying
 value of that group of assets, the fair value of the asset group is determined and the carrying value of the asset group is written down to fair value.

 When we perform the quantitative impairment test for long-lived assets, we examine 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.

 For the year ended December 31, 2024, there were no impairments related to long-lived assets.

 During the year ended December 31, 2023, as a result of the Nashville sale discussed above, the Company also recorded a pre-tax non-cash impairment charge of $0.4 million relating to long-lived assets.

 On December 31, 2022, as a result of impairment testing, it was determined that there was a long-lived asset impairment of $1.0 million. The impairment was the result of an assessment of the current market value,
 as compared to the carrying value of the assets.

 Income taxes. The Company accounts for income taxes in accordance with 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 considers, 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.

 We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. During the fiscal years ended December 31, 2024, 2023, and 2022, we did not record any interest and penalties expense associated with
 uncertain tax positions, as we do not have any uncertain tax positions.

 Results of Operations for the Three Years Ended December 31, 2024

 The following table sets forth selected consolidated statements of operations data as a percentage of revenues for each of the periods indicated:

 Year Ended Dec 31,

 2024

 2023

 2022

 Revenue

 100.0

 %

 100.0

 %

 100.0

 %

 Costs and expenses:

 Educational services and facilities

 41.3

 %

 42.9

 %

 42.7

 %

 55.4

 %

 55.3

 %

 52.4

 %

 Loss (gain) on sale of assets

 0.5

 %

 -8.2

 %

 -0.1

 %

 Gain on insurance proceeds

 -0.6

 %

 0.0

 %

 0.0

 %

 Impairment of goodwill and long-lived assets

 0.0

 %

 1.1

 %

 0.3

 %

 Total costs and expenses

 96.6

 %

 91.2

 %

 95.3

 %

 Operating income

 3.4

 %

 8.8

 %

 4.7

 %

 Interest expense, net

 -0.1

 %

 0.6

 %

 0.0

 %

 Income from operations before income taxes

 3.3

 %

 9.4

 %

 4.7

 %

 Provision for income taxes

 1.1

 %

 2.6

 %

 1.1

 %

 2.2

 %

 6.8

 %

 3.6

 %

 Year Ended December 31, 2024 Compared to Year Ended December 31, 2023

 Consolidated Results of Operations

 Revenue. Revenue increased $62.0 million, or 16.4% to $440.1 million for the fiscal year ended December 31, 2024 from $378.1 million in the prior year.
 Revenue growth was driven by several factors including an 11.5% increase in average student population, driven in part by beginning the year with 7.1%, or 882 more students than in the prior year and student start growth up 15.2% over the
 prior year. Included in the increase over the prior year was $9.6 million of revenue generated from the recently opened East Point, Georgia campus.

 Educational services and facilities expense. Our educational services and facilities expense increased $19.5 million, or 12.0% to $181.8 million for the
 fiscal year ended December 31, 2024 from $162.3 million in the prior year. The increase over the prior year includes approximately $4.3 million in preopening costs for the new Houston, Texas campus, which is expected to begin classes in the
 second half of 2025, costs related to the relocation of each of the Nashville, Tennessee and Levittown, Pennsylvania campuses, which are expected to open in the first half of 2025 and the second half of 2025, respectively, and investments to
 implement and expand new programs at existing campuses. Additional costs of $4.8 million are included in the current year as a result of the new East Point, Georgia campus that opened during the first quarter of 2024.

 Instructional expenses and books and tools expense increased $8.8 million, primarily resulting from costs associated with an increased student population.

 Facilities and Depreciation expense increased approximately $4.0 million, primarily driven by additional assets placed in service resulting from increased investments in capital expenditures in the current year.

 Partially offsetting these costs was a $2.4 million decrease in expense related to campuses included in the Transitional segment.

 Educational services and facilities expense, as a percentage of revenue, decreased to 41.3% from 42.9% for the fiscal years ended December 31, 2024 and 2023, respectively. The decrease from the prior year was most
 notable in the instructional expenses, which demonstrates an increase in operational efficiencies year-over-year.

 Selling, general and administrative expense. Our selling, general and administrative expense increased $34.7 million, or 16.6% to $243.8 million for the
 fiscal year ended December 31, 2024, from $209.1 million in the prior year. The increase over the prior year includes approximately $0.6 million in preopening costs for the new Houston, Texas campus, which is expected to begin classes in the
 second half of 2025, costs related to the relocation of each of the Nashville, Tennessee and Levittown, Pennsylvania campuses, which are expected to open in the first half of 2025 and the second half of 2025, respectively, and investments to
 implement and expand new programs at existing campuses. Additional costs of $5.4 million are included in the current year as a result of the new East Point, Georgia campus that opened during the first quarter of 2024.

 Administrative costs increased $20.5 million, driven primarily by additional salaries expense due to increased personnel combined with merit
 increases and an increase in the provision for credit losses largely driven by revenue growth. Partially offsetting these costs were decreases in stock compensation expense, as a result of expense recorded related to the number of awards
 expected to vest at December 31, 2023.

 Marketing investments increased $2.7 million, while the cost per start over the prior year remained relatively flat demonstrating continued effectiveness per marketing dollars spent. Additional investments in
 marketing year-over-year have helped contribute to the 15.2% start growth.

 Sales and student services increased $7.1 million, primarily driven by increased personnel to continue to help drive student start growth and program expansions.

 Partially offsetting these costs was a $1.7 million decrease in expense related to campuses included in the Transitional segment.

 Selling, general and administrative expense, as a percentage of revenue, increased slightly to 55.4% from 55.3% for the fiscal years ended December 31, 2024 and 2023, respectively.

 Loss on sale of assets. Loss on sale of assets was $2.1 million compared to a gain on sale of assets of $30.9 million for the fiscal years ended December
 31, 2024 and 2023, respectively. The current year loss was primarily driven by the sale of the Summerlin, Las Vegas campus, while the gain in the prior year resulted from the sale of the Company's Nashville, Tennessee property during the
 second quarter of 2023. Net proceeds from the sale were approximately $33.3 million.

 Gain on insurance proceeds. Gain on insurance proceeds for the year ended December 31, 2024 was $2.8 million relating to hail damage at one of our
 campuses.

 Impairment of goodwill and long-lived assets. Impairment of goodwill and long-lived assets was zero and $4.2
 million for the fiscal years ended December 31, 2024 and 2023, respectively. The impairment in the prior year was driven by the sale the Nashville, Tennessee property on June 8, 2023. The result of the sale created a change in the
 trajectory of the fair value of the Nashville, Tennessee operations, and as such, the Company recorded a pre-tax non-cash impairment charge of $3.8 million relating to goodwill and an additional $0.4 million impairment relating to long-lived
 assets.

 Net interest expense / income. Net interest expense was $0.5 million compared to net interest income of $2.3 million for the fiscal years ended December
 31, 2024 and 2023, respectively. Interest expense in the current year was primarily driven by the addition of two additional finance leases.

 Income taxes. Our income tax provision for the year ended December 31, 2024 was $4.8 million, or 32.8% of pre-tax income compared to $9.6 million, or 27.1% of pre-tax net income
 in the prior year. The increase in the effective tax rate was mainly due to lower pre-tax income, reduced discrete tax item benefit and tax return reconciliation from estimate to actuals.

 Year Ended December 31, 2023 Compared to Year Ended December 31, 2022

 Consolidated Results of Operations

 Revenue. Revenue increased $29.8 million, or 8.6% to $378.1 million for the fiscal year ended December 31, 2023 from $348.3 million during the fiscal
 year ended December 31, 2022. Excluding the Transitional segment revenue of $10.8 million and $17.4 million for the fiscal year ended December 31, 2023, and 2022, respectively, our revenue would have increased $36.3 million, or 11.0%. The
 remaining increase in revenue was driven by several factors including student start growth of 13.3% and an increase in average revenue per student of 7.8%, driven in part by the continuing rollout of the Company's hybrid teaching model in
 combination with tuition increases. The Company's hybrid teaching model increases program efficiency and delivers accelerated revenue recognition in certain evening programs.

 Educational services and facilities expense. Our educational services and facilities expense increased $13.5 million, or 9.1% to $162.3 million for the
 fiscal year ended December 31, 2023 from $148.7 million during the fiscal year ended December 31, 2022. Excluding the Transitional segment educational services and facilities expense of $6.7 million and $8.1 million for the fiscal years
 ended December 31, 2023 and 2022, respectively, our educational services and facilities expense would have increased $14.9 million, or 10.6%. Increased costs were primarily concentrated in instructional expense, facilities expense and books
 and tools expense.

 Instructional expenses increased $7.0 million, driven primarily by higher instructional salaries resulting from higher staffing levels due to increases in our student population and merit salary increases. In
 addition, the Company is experiencing higher staffing levels at several campuses that have launched the hybrid teaching model as the Company is providing instruction through both the new and traditional learning models for an interim period
 of time. Further increases resulted from student testing, primarily related to our nursing program, and increased consumables costs driven by a higher student population and inflation.

 Facilities expense increased by approximately $4.4 million, driven primarily by a $2.4 million increase in rent expense relating to lease extensions at several campuses, additional space taken at one of our
 campuses, non-cash rent expense relating to the new East Point, Georgia campus, and the sale-leaseback of our existing Nashville, Tennessee property. In connection with the sale of the Nashville, Tennessee property, the Company entered into
 a lease agreement allowing the Company to continue to occupy the campus and operate it on a rent-free basis for a period of 15 months. At the consummation of the sale, the Company took the fair value of the 15-month rent free period, valued
 at $2.3 million, and included the balance in prepaid expenses and other current assets on the Company's Consolidated Balance Sheets. During the 15-month rent-free period, the Company will straight-line the expense until the rent-free period
 has expired. Also contributing to the increased costs were higher utility expense driven by inflation and an increase in repairs and maintenance at several campuses.

 Books and tools expense increased $3.2 million, driven by a 14.6% increase in student starts year-over-year and vendor price increases.

 Educational services and facilities expense, as a percentage of revenue, increased to 42.9% from 42.7% for the fiscal years ended December 31, 2023 and 2022, respectively.

 Selling, general and administrative expense. Our selling, general and administrative expense increased $26.7 million, or 14.7% to $209.1 million for the
 fiscal year ended December 31, 2023, from $182.4 million during the fiscal year ended December 31, 2022. Excluding the Transitional segment selling, general and administrative expense of $6.5 million and $8.0 million for the fiscal years
 ended December 31, 2023 and 2022, respectively, our selling general and administrative expense would have increased $28.3 million, or 16.2%. Increased costs were driven by the following:

 Administrative costs increased $20.3 million, driven by several factors including a) an increase in performance-based incentives driven by improved financial performance above plan, b) increased stock-based
 compensation due to achieving financial targets, c) additional bad debt expense driven by revenue growth of $36.3 million and a slight deterioration in collection rates and d) higher legal costs. In addition, at December 31, 2023, the
 Company provided all employees, who are not part of the Company's bonus incentive plan with a holiday bonus.

 Marketing investments increased $4.1 million, helping drive additional student starts, up 11.4% year-over-year. Increased investments were driven in part by continued incremental marketing support for
 the two new programs that were launched in the third quarter of 2023, which included Medical Assistant at our Columbia, MD campus and Electrical & Electronic Systems Technology at our Grand Prairie, TX campus. Marketing investment in the
 fourth quarter of 2023 also included the start of an awareness building media campaign for the new East Point, GA campus. Despite additional investments in marketing for the year, the total cost to obtain a student remained flat demonstrating
 the effectiveness of the current marketing campaign.

 Student services increased $2.3 million, primarily resulting from costs associated with an increased student population.

 Selling, general and administrative expense, as a percentage of revenue, increased to 55.3% from 52.4% for the fiscal years ended December 31, 2023 and 2022, respectively.

 Gain on sale of assets. Gain on sale of assets was $30.9 million, for the fiscal year ended December 31, 2023 resulting from the sale of the Company's
 Nashville, Tennessee property during the second quarter of 2023. Net proceeds from the sale were approximately $33.3 million.

 Gain on sale of assets was $0.2 million for the fiscal year ended December 31, 2022, resulting from the sale of the Suffield, Connecticut campus during the second quarter of 2022. Net proceeds from the sale were
 approximately $2.4 million.

 Impairment of goodwill and long-lived assets. Impairment of goodwill and long-lived assets was $4.2 million for
 the fiscal year ended December 31, 2023 driven by the sale the Nashville, Tennessee property on June 8, 2023. The result of the sale created a change in the trajectory of the fair value of the Nashville, Tennessee operations, and as such,
 the Company recorded a pre-tax non-cash impairment charge of $3.8 million relating to goodwill and an additional $0.4 million impairment relating to long-lived assets.

 For the fiscal year ended December 31, 2022, as a result of the Company's annual test of goodwill and long-lived assets, it was determined that there was sufficient evidence to conclude that a $1.0 million
 impairment existed. The impairment was the result of an assessment of the current market value, as compared to the current carrying value of the assets. Approximately $0.6 million of the Company's ROU asset was impaired in addition to $0.4
 million of long-lived assets.

 Net interest income. Net interest income was $2.3 million for the fiscal year ended December 31, 2023 compared to $0.2 million during the fiscal year
 ended December 31, 2022. The increase in net interest income was primarily driven by the Company's investment of its cash reserves into various short-term investments for the full fiscal year ended December 31, 2023, compared to investing
 cash reserves in the fourth quarter of 2022. The current year net interest income is partially offset by approximately $0.2 million of additional interest expense relating to a finance lease obligation for our new Nashville, Tennessee
 property.

 Income taxes. Our income tax provision for the year ended December 31, 2023 was $9.6 million, or 27.1% of pre-tax income compared to $3.8
 million, or 23.1% of pre-tax income for the year ended December 31, 2022. During the year ended December 31, 2023, the increase in effective tax rate was mainly due to a lesser tax benefit derived from restricted stock vesting and higher
 pre-tax income.

 Segment Results of Operations

 The Company manages its business, evaluates performance and allocates resources based on two reportable business segments, Campus Operations and Transitional:

 Campus Operations - The Campus Operations segment includes campuses that are continuing in operation and contribute to the Company's core operations and performance. All of the campuses
 continuing in operation are classified in this segment. The majority of the campuses offer programs across various areas of study.

 Transitional – The Transitional segment refers to campuses that
 are marked for closure and are currently being taught-out, in addition to campuses that are held-for-sale or sold. As of December 31, 2024, the net assets for the Summerlin, Las Vegas campus were classified as held for sale, with operating
 results classified within the Transitional segment. The sale of the campus was effectuated on January 1, 2025. In addition, the Company closed the Somerville, Massachusetts campus in the prior year. It was fully taught-out as of December
 31, 2023. This campus is classified in the Transitional segment in the prior year's statement of operations.

 We evaluate performance based on operating results. Adjustments to reconcile segment results to consolidated results are included in the caption "Corporate," which primarily includes unallocated corporate activity.

 The following table presents results for the activity for our reportable operating segments for the fiscal years ended December 31, 2024 and 2023:

 2024

 2023

 % Change

 Revenue:

 $

 432,966

 $

 367,233

 17.9

 %

 7,098

 10,837

 -34.5

 %

 Total

 $

 440,064

 $

 16.4

 %

 Operating Income (Loss):

 $

 63,558

 $

 48,031

 32.3

 %

 (2,039

)

 (2,366

)

 13.8

 %

 Corporate

 (46,342

)

 (12,307

)

 -276.5

 %

 Total

 $

 15,177

 $

 33,358

 -54.5

 %

 Starts:

 18,153

 15,526

 16.9

 %

 -24.7

 %

 Total

 18,660

 16,199

 15.2

 %

 Average Population:

 14,100

 12,436

 13.4

 %

 -35.4

 %

 Total

 14,426

 12,941

 11.5

 %

 End of Period Population:

 14,838

 12,900

 15.0

 %

 -18.9

 %

 Total

 15,138

 13,270

 14.1

 %

 Year Ended December 31, 2024 Compared to Year Ended December 31, 2023

 Operating income was $63.6 million and $48.0 million for the fiscal years ended December 31, 2024 and 2023, respectively. The change year-over-year was mainly driven by the following factors:

 •

 Revenue increased $65.7 million, or 17.9% to $432.9 million for the fiscal year ended December 31, 2024 from $367.2 million in the prior year. Revenue growth was driven by several factors including an
 13.4% increase in average student population, driven in part by beginning the year with 10.2% or approximately 1,100 more students than in the prior year and student start growth up 16.9% over the prior year. Included in the increase
 over the prior year was $9.6 million of revenue generated from the recently opened East Point, Georgia campus.

 •

 Educational services and facilities expense increased $21.9 million, or 14.1% to $177.4 million for the fiscal year ended December 31, 2024 from $155.5 million in the prior year. The increase over the
 prior year includes approximately $4.3 million in preopening costs for the new Houston, Texas campus, which is expected to begin classes in the second half of 2025, costs related to the relocation of each of the Nashville, Tennessee
 and Levittown, Pennsylvania campuses, which are expected to open in the first half of 2025 and the second half of 2025, respectively, and investments to implement and expand new programs at existing campuses. Additional costs of $4.8
 million are included in the current year as a result of the new East Point, Georgia campus that opened during the first quarter of 2024. Remaining cost increases were driven by increased instructional expenses, additional books and
 tools expense and an increase in depreciation expense, all of which are discussed above in the Consolidated Results of Operations.

 •

 Selling, general and administrative expense increased $32.0 million, or 20.0% to $191.4 million for the fiscal year ended December 31, 2024, from $159.4 million in the prior year. The increase over the
 prior year includes approximately $0.4 million in preopening costs for the new Houston, Texas campus, which is expected to begin classes in the second half of 2025, costs related to the relocation of each of the Nashville, Tennessee
 and Levittown, Pennsylvania campuses, which are expected to open in the first half of 2025 and the second half of 2025, respectively, and investments to implement and expand new programs at existing campuses. Additional costs of $5.4
 million are included in the current year as a result of the new East Point, Georgia campus that opened during the first quarter of 2024. Remaining cost increases were primarily driven by increased administrative costs, marketing
 investments and sales, and student services, all of which are discussed above in the Consolidated Results of Operations.

 •

 Impairment of goodwill and long-lived assets was zero and $4.2 million for the fiscal years ended December 31, 2024 and 2023, respectively, as discussed above in the Consolidated Results of Operations.

 As of December 31, 2024, the assets of the Company's Summerlin, Las Vegas campus were classified as held for sale on the balance sheet and has classified statement of operating results within the Transitional segment. Previously, in
 November, 2022, the Board of Directors approved a plan to close the Somerville, Massachusetts campus. It was fully taught-out as of December 31, 2023 and was classified in the Transitional segment in the prior year's statement of operations.

 •

 Revenue decreased $3.7 million, or 34.5% to $7.1 million for the fiscal year ended December 31, 2024, from $10.8 million in the prior year.

 •

 Total operating expenses decreased $4.1 million, or 30.8% to $9.1 million for the fiscal year ended December 31, 2024, from $13.2 million in the prior year.

 The primary reason for the decrease in both revenue and operating expenses year-over-year was due to one campus, the Summerlin, Las Vegas campus, being classified in the Transitional segment in the current year and
 two campuses, the Summerlin, Las Vegas campus and the Somerville, Massachusetts campus, being included in the Transitional segment in the fiscal year ended December 31, 2023.

 Corporate and Other

 This category includes unallocated expenses incurred on behalf of the entire Company. Corporate and other expenses were $46.3 million and $12.3 million for the years ended December 31, 2024 and 2023, respectively.
 Included in the current year is a $1.5 million loss on sale of assets mostly related to the sale of our Summerlin, Las Vegas campus and a $2.8 million gain related to insurance proceeds received as a result of hail damage at one of our
 campuses. The prior year balance includes a $30.9 million gain on sale of assets resulting from the sale of the Nashville, Tennessee property. The increase in expense from the prior year is primarily related to additional salaries and
 benefits expense, partially offset by reduced stock compensation expense.

 The following table presents results for the activity for our reportable operating segments for the fiscal years ended December 31, 2023 and 2022:

 2023

 2022

 % Change

 Revenue:

 $

 367,233

 $

 330,896

 11.0

 %

 10,837

 17,391

 -37.7

 %

 Total

 $

 $

 348,287

 8.6

 %

 Operating Income (Loss):

 $

 48,031

 $

 47,799

 0.5

 %

 (2,366

)

 1,295

 282.7

 %

 Corporate

 (12,307

)

 (32,816

)

 62.5

 %

 Total

 $

 33,358

 $

 16,278

 104.9

 %

 Starts:

 15,526

 13,709

 13.3

 %

 1,211

 -44.4

 %

 Total

 16,199

 14,920

 8.6

 %

 Average Population:

 12,436

 12,079

 3.0

 %

 -38.0

 %

 Total

 12,941

 12,894

 0.4

 %

 End of Period Population:

 12,900

 11,703

 10.2

 %

 -46.0

 %

 Total

 13,270

 12,388

 7.1

 %

 Year Ended December 31, 2023 Compared to Year Ended December 31, 2022

 Operating income was $48.0 million and $47.8 million for the fiscal years ended December 31, 2023 and 2022, respectively. The change year-over-year was mainly driven by the following factors:

 •

 Revenue increased $36.3 million, or 11.0% to $367.2 million for the fiscal year ended December 31, 2023 from $330.9 million for the fiscal year ended December 31, 2022. The increase in revenue was
 driven by several factors including student start growth of 13.3% and an increase in average revenue per student of 7.8%, driven in part by the continuing rollout of the Company's hybrid teaching model in combination with tuition
 increases. The Company's hybrid teaching model increases program efficiency and delivers accelerated revenue recognition in certain evening programs.

 •

 Educational services and facilities expense increased $14.9 million, or 10.6% to $155.5 million for the fiscal year ended December 31, 2023 from $140.7 million during the fiscal year ended December 31,
 2022. Increased costs were primarily concentrated in instructional, facilities expense, and books and tools expense.

 o

 Instructional expenses increased $7.0 million, driven primarily by higher instructional salaries resulting from higher staffing levels due to increases in our student population and merit salary
 increases. In addition, the Company is experiencing higher staffing levels at several campuses that have launched the hybrid teaching model as the Company is providing instruction through both the new and traditional learning models
 for an interim period of time. Further increases resulted from student testing, primarily related to our nursing program, and increased consumables costs driven by a higher student population and inflation.

 o

 Facilities expense increased by approximately $4.4 million, driven primarily by a $2.4 million increase in rent expense relating to lease extensions at several campuses, additional space taken at one of
 our campuses, non-cash rent expense relating to the new East Point, Georgia campus, and the sale-leaseback of our existing Nashville, Tennessee property. In connection with the sale of the Nashville, Tennessee property, the Company
 entered into a lease agreement allowing the Company to continue to occupy the campus and operate it on a rent-free basis for a period of 15 months. At the consummation of the sale, the Company took the fair value of the 15-month rent
 free period, valued at $2.3 million, and included the balance in prepaid expenses and other current assets on the Company's Consolidated Balance Sheets. During the 15-month rent-free period, the Company will straight-line the expense
 until the rent-free period has expired. Also contributing to the increased costs were higher utility expense driven by inflation and an increase in repairs and maintenance at several campuses.

 o

 Books and tools expense increased $3.2 million, driven by a 14.6% increase in student starts year-over-year.

 •

 Selling, general and administrative expense increased $18.0 million, or 12.8% to $159.4 million for the fiscal year ended December 31, 2023, from $141.4 million during the fiscal year ended December 31,
 2022. The increase was primarily driven by an increase in administrative costs, marketing investments, and student services, all of which are discussed above in the Consolidated Results of Operations.

 •

 Impairment of goodwill and long-lived assets was $4.2 million and $1.0 million for the fiscal years ended December 31, 2023 and 2022, respectively, as discussed above in the Consolidated Results of
 Operations.

 On November 3, 2022, the Board of Directors approved a plan to close the Somerville, Massachusetts campus. The owner of the Somerville property has exercised an option to terminate the lease on December 8, 2023 and
 the Company has since determined not to pursue relocating the campus in this geographic region. The campus has been fully taught-out, and total costs to close the campus were approximately $2.0 million. Additionally, statement of operations
 information for the Summerlin, Las Vegas campus for the years ended December 31, 2023 and 2022, respectively, has been included in the Transitional segment revenue and operating expense information for comparability.

 •

 Revenue decreased $6.5 million, or 37.7% to $10.8 million for the fiscal year ended December 31, 2023, from $17.4 million during the fiscal year ended December 31, 2022.

 •

 Total operating expenses decreased $2.9 million, or 18.0% to $13.2 million for the fiscal year ended December 31, 2023, from $16.1 million during the fiscal year ended December 31, 2022.

 For the year ended December 31, 2023, the Transitional segment included normal full year operations for the Summerlin, Las Vegas campus and a teach-out at the Somerville, Massachusetts campus, which was winding down
 operations and no longer accepting new students. During the year ended December 31, 2022, the Transitional segment included normal full year operations for both the Summerlin, Las Vegas and Somerville, Massachusetts campuses.

 Corporate and Other

 This category includes unallocated expenses incurred on behalf of the entire Company. Corporate and other expenses were $43.2 million and $33.0 million after excluding a $30.9 million gain in 2023, resulting from
 the sale of our Nashville, Tennessee property and a $0.2 million gain in 2022 driven by the sale of our former campus property in Suffield, Connecticut. Increased costs were driven by several factors including additional performance-based
 incentives, stock-based compensation, and an increase in legal costs.

 LIQUIDITY AND CAPITAL RESOURCES

 Our primary capital requirements are for maintenance and expansion of our facilities and the development of new programs. Our principal source of liquidity has been cash provided by operating activities. The
 following chart summarizes the principal elements of our cash flow for each of the three fiscal years in the period ended December 31, 2024:

 Cash Flow Summary

 2024

 2023

 2022

 (In thousands)

 Net cash provided by operating activities

 $

 29,306

 $

 25,558

 $

 Net cash (used in) provided by investing activities

 $

 (46,971

)

 $

 7,369

 $

 (21,354

)

 Net cash used in financing activities

 $

 (3,331

)

 $

 (2,945

)

 $

 (12,548

)

 As of December 31, 2024, the Company had $59.3 million in cash and cash equivalents, compared to $80.3 million in cash and cash equivalents and restricted cash as of December 31, 2023. The change in cash position
 from the end of the year was driven in part by the payment of incentive compensation during the first quarter and investments in capital expenditures relating to our recently opened East Point, Georgia campus, the new Houston Texas campus,
 the relocation of each of the Nashville, Tennessee and Levittown, Pennsylvania campuses, and new programs and program expansions. Further, the prior year cash position benefited from $33.3 million in proceeds resulting from the sale of our
 Nashville, Tennessee property.

 As of December 31, 2023, the Company had $80.3 million in cash and cash equivalents and restricted cash, compared to $50.3 million in cash and cash equivalents and restricted cash, including $14.7 million in
 short-term investments as of December 31, 2022. The change in cash position from the prior year was primarily driven by several factors including the sale of our Nashville, Tennessee property, which yielded approximately $33.3 million in
 proceeds, cash flow generated from operations of $25.9 million, and an increase of $2.1 million relating to additional interest income driven by the investment of cash reserves into various short-term investment vehicles during the year ended
 December 31, 2023. Partially offsetting the increase in cash position were investments of $41.2 million in capital expenditures, which includes the buildout of the new East Point, Georgia campus and the purchase of the new Levittown,
 Pennsylvania property for approximately $10.2 million on September 28, 2023. Also contributing to the change in cash year-over-year were incentive compensation payments, share repurchases made under the share repurchase program, and
 one-time costs incurred in connection with the teach-out of our Somerville, Massachusetts campus.

 On May 24, 2022, the Company announced that its Board of Directors had authorized a share repurchase program of up to $30.0 million of the Company's outstanding Common Stock. The share repurchase program was
 authorized for 12 months. On February 27, 2023, the Board of Directors extended the share repurchase program for an additional 12 months and authorized the repurchase of an additional $10.0 million of the Company's Common Stock, for an
 aggregate of up to $30.6 million in additional repurchases.

 On May 7, 2024, the Company announced that its Board of Directors had authorized an extension of its share repurchase program for an additional 12 months through May 24, 2025. During the year ended December 31,
 2024, the Company did not repurchase any additional shares. As of December 31, 2024, the Company had approximately $29.7 million remaining for additional repurchases under the program.

 On December 24, 2024, the Company filed a Registration Statement on Form S-3 with the Securities and Exchange Commission ("SEC") registering securities for potential future use. Under the Registration Statement, we
 may sell the securities described in the prospectus from time to time in one or more offerings up to a total dollar amount of $150 million.

 Our primary source of cash is tuition collected from our students. The majority of students enrolled at our schools rely on funds received under various government-sponsored student financial aid programs to pay a
 substantial portion of their tuition and other education-related expenses. The most significant source of student financing is Title IV Programs, which represented approximately 82% of our cash receipts relating to revenues in 2024. Pursuant
 to applicable regulations, students must apply for a new loan for each academic period. Federal regulations dictate the timing of disbursements of funds under Title IV Programs and loan funds are generally provided by lenders in two
 disbursements for each academic year. The first disbursement is usually received approximately 31 days after the start of a student's academic year and the second disbursement is typically received at the beginning of the sixteenth week from
 the start of the student's academic year. Certain types of grants and other funding are not subject to a 31-day delay. In certain instances, if a student withdraws from a program prior to a specified date, any paid but unearned tuition or
 prorated Title IV Program financial aid is refunded according to federal, state and accrediting agency standards.

 As a result of the significant amount of Title IV Program funds received by our students, we are highly dependent on these funds to operate our business. Any reduction in the level of Title IV Program funds that our
 students are eligible to receive for tuition payment to us or any restriction on our eligibility to receive Title IV Program funds would have a significant impact on our operations and our financial condition. For more information, See Part
 I, Item 1A. "Risk Factors - Risks Related to Our Industry".

 Operating Activities

 Operating cash flow results primarily from cash received from our students, offset by changes in working capital demands. Working capital can vary at any point in time based on several factors including
 seasonality, timing of cash receipts and payments and vendor payment terms.

 Net cash provided by operating activities for the years ended December 31, 2024 and 2023 was $29.3 million and $25.5 million, respectively. The increase from prior year was primarily driven by higher net income
 after adjusting for non-operational income items.

 Net cash provided by operating activities for the years ended December 31, 2023 and 2022 was $25.5 million and $0.8 million, respectively. The $24.7 million increase was driven by several factors including a $12.0
 million increase in accrued expenses, primarily driven by additional performance-based incentives in the current year as a result of improved financial performance, in addition to a $13.6 million change in accounts receivable, also
 considering the provision for credit losses and unearned tuition. Increases in accounts receivable were primarily driven by a $29.8 million increase in revenue year-over-year.

 Investing Activities

 Net cash used in investing activities was $47.0 million for the fiscal year ended December 31, 2024, compared to net cash provided by investing activities of $7.3 million for the fiscal year ended December 31,
 2023. The primary reason for the decrease in net cash was due to increased investments in capital expenditures in the current year, partially offset by a proceeds from the sale of the Levittown, Pennsylvania property. The December 31, 2023
 cash position benefited from several factors including the sale of the Nashville, Tennessee property and proceeds received from short-term investments. Partially offsetting these cash inflows was the purchase of additional short-term
 investments.

 Net cash provided by investing activities was $7.3 million for the fiscal year ended December 31, 2023, compared to net cash used in investing activities of $21.4 million for the fiscal year ended December 31,
 2022. The increase of $28.7 million was driven by several factors including a $30.9 million increase in proceeds from the sale of property and equipment driven by the sale of our Nashville, Tennessee property during the second quarter of
 2023, in addition to an increase in net proceeds from investments of $29.5 million. Partially offsetting the cash inflows was an increase in investments in capital expenditures of $31.7 million, which was primarily driven by the buildout of
 the new East Point, Georgia campus and the purchase of the new Levittown, Pennsylvania property for approximately $10.2 million, which was consummated on September 28, 2023.

 We currently lease all of our campuses.

 Capital expenditures were 13.1% of revenues in 2024 and are expected to be approximately 16.0% of revenues in 2025. The increase in planned capital expenditures over the prior year will be driven by several factors
 that include but are not limited to the buildout of the Nashville, Tennessee, Levittown, Pennsylvania, Houston, Texas and Hicksville, New York campuses. In addition, we plan to invest $2.5 million into expanding programs at the Melrose,
 Illinois and Allentown, Pennsylvania campuses and we plan to invest an additional $20.0 million for educational equipment, real estate improvements, and information technology across various campuses. We expect to fund future capital
 expenditures with cash generated from operating activities and cash on hand.

 Financing Activities

 Net cash used in financing activities for the fiscal years ended December 31, 2024 and 2023 was $3.3 million and $2.9 million, respectively. The increase in cash used of $0.4 million was driven by several factors
 including the payment of $0.4 million of deferred financing fees paid for implementing the new credit facility with Fifth Third Bank National Association, a $1.3 million increase in cash outflow relating to the tax impact for vested stock
 grants, and a $0.3 million cash outflow relating to lease payments made under the Company's two additional finance leases. Partially offsetting these cash outflows was a $0.8 million inflow for a tenant allowance relating to one of the
 Company's finance leases in the current year. The fiscal year ended December 31, 2023 also included a $0.9 million cash outflow relating to the Company's share repurchase plan.

 Net cash used in financing activities for the fiscal years ended December 31, 2023 and 2022 was $2.9 million and $12.5 million, respectively. The decrease in cash used of $9.6 million was
 primarily driven by a $8.5 million reduction in repurchases made under the Company's share repurchase program in the current year, in addition to $1.1 million of dividend payments made in the prior year.

 Credit Facility

 On February 16, 2024, the Company entered into a secured credit agreement (the "Fifth Third Credit Agreement") with Fifth Third Bank, National Association (the "Bank"), pursuant to which the
 Company, as borrower, has obtained a revolving credit facility in the aggregate principal amount of $40.0 million including a $10.0 million letter of credit sublimit and a $20.0 million accordion feature (the "Facility"), the proceeds of
 which are to be used for working capital, general corporate and certain other permitted purposes. The Facility is guaranteed by the Company's wholly-owned subsidiaries and is secured by a first priority lien in favor of the Bank on
 substantially all of the personal property owned by the Company and its subsidiaries. The term of the Facility is 36 months, maturing on February 16, 2027.

 Each advance under the Facility will bear interest on the outstanding principal amount thereof from the date when made at an interest rate determined at the election of the Company at either
 the Tranche Rate (which is the forward-looking Secured Overnight Financing Rate (SOFR) for one or three months), or the Base Rate (which is a variable per annum rate, as of any date of determination, equal to the Bank's Prime Rate), plus an
 Applicable Margin. The Applicable Margin is determined pursuant to a Pricing Grid, which for loans subject to the Tranche Rate varies from 1.75% to 2.50% and for loans subject to the Base Rate varies from 0.75% to 1.50%. The Applicable
 Margin may change quarterly based on the Total Leverage Ratio at such time. The Total Leverage Ratio is determined with respect to the Company and its subsidiaries on a consolidated basis for an applicable quarterly period by dividing the
 aggregate principal amount of various forms of borrowed indebtedness as of the last day of a determination period by EBITDA (earnings before interest expense, taxes, depreciation and amortization) for such period. Interest is paid in
 arrears, either quarterly or monthly depending on the Company's interest rate election, with the principal due at maturity.

 Under the terms of the Fifth Third Credit Agreement, the Company will pay to the Bank an unused facility fee on the average daily unused balance of the Facility at a rate per annum equal to
 0.50%, which fee is payable in arrears on dates when interest is due and payable. As of December 31, 2024, the Company has paid approximately $200,000 in unused facility fees. The Company will also pay to the Bank a letter of credit fee
 equal to the Applicable Margin for loans subject to the Tranche Rate multiplied by the maximum amount available to be drawn under such letter of credit.

 The Fifth Third Credit Agreement contains customary representations, warranties and affirmative and negative covenants, as well as events of
 default customary for facilities of this type. In connection with the Fifth Third Credit Agreement, the Company paid fees of approximately $456,000 consisting of bank fees, closing fees, legal costs and other customary fees and
 reimbursements.

 On July 18, 2024, Company entered into a first amendment (the "Amendment") of the Fifth Third Credit Agreement with the Bank. Among other things,
 the Amendment effects certain modifications to (i) clarify certain representations and affirmative covenants of the Company, (ii) clarify certain conditions to each advance, (iii) clarify and/or replace certain events of default and (iv)
 delete or revise certain definitions in order to harmonize them with the other modifications made. The Amendment also contains customary releases, representations and warranties and reaffirmations consistent with the original terms of the
 Fifth Third Credit Agreement. Except as set forth above, the Amendment does not materially alter the Fifth Third Credit Agreement.

 Climate Change

 Climate change has not had and is not expected to have a significant impact on our operations.

 Contractual Obligations

 Current portion of Long-Term Debt, Long-Term Debt and Lease Commitments. As of December 31, 2024, we have no debt outstanding. We lease offices,
 educational facilities, and various items of equipment for varying periods through the year 2045 under basic annual rentals.

 As of December 31, 2024, the Company entered into one new operating lease, one new finance lease, and eleven lease modifications. The Company obtained the operating and finance Right of Use ("ROU") asset in exchange
 for an operating and finance lease liability of $15.7 million and $12.6 million, respectively. In addition, the eleven lease modifications resulted in a noncash re-measurement of the related ROU asset and operating lease liability of $43.3
 million.

 We had no off-balance sheet arrangements as of December 31, 2023, except for existing surety bonds. We are required to post surety bonds on behalf of our campuses and education representatives with multiple states
 to maintain authorization to conduct our business. At December 31, 2024, we posted surety bonds in the aggregate amount of approximately $17.0 million. These off-balance sheet arrangements do not adversely impact our liquidity or capital
 resources.

 As of December 31, 2024 and 2023, we had outstanding extensions of credit commitments to our active students of $44.6 million and $33.6 million, respectively. These are institutional extensions of credit and no
 cash is advanced to students. The full extension of credit amount is not guaranteed unless the student completes the program. The institutional extensions of credit are considered commitments because the students are required to fund their
 education using these funds and they are not reported in our Consolidated Financial Statements.

 SEASONALITY AND OUTLOOK

 Seasonality

 Our revenue and operating results normally fluctuate as a result of seasonal variations in our business, principally due to changes in total student population. Student population varies due to
 new student enrollments, graduations and student attrition. Historically, our schools have had lower student populations in our first and second quarters and we have experienced larger class starts in the third quarter and higher student
 attrition in the first half of the year. The growth that we generally experience in the second half of the year is largely dependent on a successful high school recruiting season. We recruit high school students several months ahead of their
 scheduled start dates and, as a consequence, while we have visibility on the number of students who have expressed interest in attending our schools, we cannot predict with certainty the actual number of new student enrollments in any given
 year and the related impact on revenue. Our expenses, however, typically do not vary significantly over the course of the year with changes in our student population and revenue.

 Effect of Inflation

 Inflation has not had a material effect on our operations.

 ITEM 7A.

 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 During the year ended December 31, 2024, we invested cash reserves into money market funds. As of December 31, 2024, we have invested approximately $44.4 million in cash equivalents and have earned interest income
 of approximately $2.1 million. Due to our conservative investment approach, the Company expects minimal financial exposure to interest rate fluctuations affecting interest income. Additionally, the Company does not believe that current
 market events have had a significant impact on the value or liquidity of the Company's cash, cash equivalents, or investments.

 Details of the Company's outstanding credit agreement can be found in Note 11 of the Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K. For the year ended December 31, 2024,
 the Company remained debt free and recorded interest expense of $0.4 million primarily related to deferred costs associated with the implementation of the credit agreement and unused fees for the credit line.

 ITEM 8.

 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 See "Index to Consolidated Financial Statements" on page F-1 of this Annual Report on Form 10-K.

 ITEM 9.

 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 None.

 ITEM 9A.

 CONTROLS AND PROCEDURES

 Evaluation of Disclosure Controls and Procedures

 Our Chief Executive Officer and Chief Financial Officer, after evaluating, together with management, the effectiveness of our disclosure controls and procedures (as defined in Securities Exchange Act Rule 13a-15(e))
 as of December 31, 2024 have concluded that our disclosure controls and procedures are effective to reasonably ensure that material information required to be disclosed by us in the reports that we file or submit under the Securities Exchange
 Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified by Securities and Exchange Commission's Rules and Forms and that such information is accumulated and communicated to our management,
 including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

 Internal Control Over Financial Reporting

 During the quarter ended December 31, 2024, there was no change in our internal control over financial reporting that materially affected, or is reasonably likely to materially affect, our internal control over
 financial reporting.

 Management's Annual Report on Internal Control over Financial Reporting and Attestation Report of Independent Registered Public Accounting Firm

 The management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended.
 The Company's internal control system was designed to provide reasonable assurance to the Company's management and Board of Directors regarding the reliability of financial reporting and the preparation of financial statements for external
 purposes in accordance with generally accepted accounting principles.

 Management assessed the effectiveness of the Company's internal control over financial reporting as of December 31, 2024 based on the framework set forth by the Committee of Sponsoring Organizations of the Treadway
 Commission (COSO) in Internal Control—Integrated Framework (2013). Based on its assessment, management believes that, as of December 31, 2024, the Company's internal control over financial reporting
 is effective.

 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk
 that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 Deloitte & Touche LLP, an independent registered public accounting firm, audited the Company's internal control over financial reporting as of December 31, 2024, as stated in their report included in this Form
 10-K that follows.

 ITEM 9B.

 OTHER INFORMATION

 During the three months ended December 31, 2024, none of the Company's directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted, terminated or modified a "Rule 10b5-1
 trading arrangement" or "non-Rule 10b5-1 trading arrangement" (as such terms are defined in Item 408 of Regulation S-K).

 ITEM 9C.

 DISCLOSURES REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

 Not Applicable.

 PART III.

 Certain information required by this item will be included in a definitive proxy statement for the Company's annual meeting of shareholders or an amendment to this Annual Report on Form 10-K, in either case filed with the Securities and
 Exchange Commission within 120 days after December 31, 2024, and is incorporated by reference herein.

 ITEM 10.

 DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 Directors and Executive Officers

 Certain information required by this Item 10 of Part III is incorporated by reference from a definitive proxy statement or an amendment to this Annual Report on Form 10-K that will be filed with the Securities and

 Code of Ethics

 We have adopted a Code of Business Ethics and Conduct applicable to our directors, officers and employees and certain other persons, including our Chief Executive Officer and Chief Financial Officer. A copy of our
 Code of Business Ethics and Conduct is available on our website at www.lincolntech.edu. If any amendments to or waivers from the Code of Business Ethics and Conduct are made, we will disclose such
 amendments or waivers on our website.

 ITEM 11.

 EXECUTIVE COMPENSATION

 The information required by this Item 11 of Part III is incorporated by reference from a definitive proxy statement or an amendment to this Annual Report on Form 10-K that will be filed with the Securities and

 ITEM 12.

 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 The information required by this Item 12 of Part III is incorporated by reference from a definitive proxy statement or an amendment to this Annual Report on Form 10-K that will be filed with the Securities and

 ITEM 13.

 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

 The information required by this Item 13 of Part III is incorporated by reference from a definitive proxy statement or an amendment to this Annual Report on Form 10-K that will be filed with the Securities and

 ITEM 14.

 PRINCIPAL ACCOUNTANT FEES AND SERVICES

 The information required by this Item 14 of Part III is incorporated by reference from a definitive proxy statement or an amendment to this Annual Report on Form 10-K that will be filed with the Securities and

 PART IV.

 ITEM 15.

 EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

 1.

 Financial Statements

 See "Index to Consolidated Financial Statements" on page F-1 of this Annual Report on Form 10-K.

 2.

 Financial Statement Schedules

 See "Index to Consolidated Financial Statements" on page F-1 of this Annual Report on Form 10-K.

 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 (incorporated by reference to the Company's Registration Statement on Form S-1/A (Registration No. 333-123644) filed June 7, 2005.

 3.2

 Certificate of Amendment, dated November 14, 2019, to the Amended and Restated Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.2 of the Company's Registration
 Statement on Form S-3 filed October 6, 2020).

 3.3

 Bylaws of the Company, as amended on March 8, 2019 (incorporated by reference to Exhibit 3.1 of the Company's Form 8-K filed April 30, 2020).

 4.1

 Specimen Stock Certificate evidencing shares of Common Stock (incorporated by reference to the Company's Registration Statement on Form S-1/A (Registration No. 333-123644) filed June 21, 2005).

 4.2

 Registration Rights Agreement, dated as of November 14, 2019, between the Company and the investors parties thereto (incorporated by reference to the Company's Quarterly Report on Form 10-Q filed
 November 14, 2019).

 4.3

 Description of Securities of the Company (incorporated by reference to Exhibit 4.3 of the Company's Annual Report on Form 10-K filed March 9, 2021).

 10.1+

 Employment Agreement, dated as of December 13, 2022, between the Company and Scott M. Shaw (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed December 16, 2022).

 10.2+

 Employment Agreement, dated as of December 13, 2022, between the Company and Brian K. Meyers (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed December 16, 2022).

 10.3+

 Employment Agreement dated as of December 13, 2022 between the Company and Chad D Nyce (incorporated by reference to Exhibit 10.3 of the Company's Current Report on Form 8-K filed December 16, 2022).

 10.4*+

 Employment Agreement dated as of December 13, 2022 between the Company and Stephen A. Ace.

 10.5*+

 Employment Agreement dated as of December 13, 2022 between the Company and Alexandra M. Luster.

 10.6+

 Lincoln Educational Services Corporation 2020 Long-Term Incentive Plan (as amended) (incorporated by reference to Exhibit 4.3 of the Company's Registration Statement on Form S-8 filed February 16, 2024).

 10.7*+

 Form of Agreement Pursuant to the Lincoln Educational Services Corporation 2020 Long-Term Incentive Plan as to Time-Restricted Shares and
 Performance-Restricted Shares.

 10.8*+

 Form of Agreement Pursuant to the Lincoln Educational Services Corporation 2020 Long-Term Incentive Plan as to Performance-Restricted Shares.

 10.9+

 Lincoln Educational Services Corporation Severance and Retention Policy (incorporated by reference to Exhibit 10.1 of the Company's Quarterly Report on Form 10-Q filed November 7, 2022).

 10.10

 Securities Purchase Agreement, dated as of November 14, 2019, between the Company and the investor parties thereto (incorporated by reference to Exhibit 10.1 of the Company's Quarterly Report on Form
 10-Q filed November 14, 2019).

 10.11

 Credit Agreement dated as of February 16, 2024 among Lincoln Educational Services Corporation and its subsidiaries and Fifth Third Bank, National Association (incorporated by reference to Exhibit 10.1 of the
 Company's Current Report on Form 8-K filed February 23, 2024).

 10.12

 Amendment to Credit Agreement, dated July 18, 2024, between Lincoln Educational Services Corporation and Fifth Third Bank, National Association (incorporated by reference to Exhibit 10.1 of the
 Company's Current Report on Form 8-K filed July 23, 2024).

 10.13

 Form of Indemnification Agreement between the Company and each director of the Company (incorporated by reference to Exhibit 10.4 of the Company's Quarterly Report on Form 10-Q filed November 14, 2019).

 10.14

 Indemnification Agreement between the Company and John A. Bartholdson (incorporated by reference to Exhibit 10.5 of the Company's Quarterly Report on Form 10-Q filed November 14, 2019.

 19.1*

 Insider Trading Policy.

 21.1*

 Subsidiaries of the Company.

 23*

 Consent of Independent Registered Public Accounting Firm.

 24*

 Power of Attorney (included on the Signature page of this Annual Report on 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.

 97.1+

 Compensation Recovery Policy ( incorporated by reference to Exhibit 97.1 of the Company's Annual Report on Form 10-K filed March 5, 2024).

 101*

 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.

 *

 Filed herewith.

 +

 Indicates management contract or compensatory plan or arrangement required to be filed or incorporated by reference as an exhibit to this Form 10-K pursuant to Item 15(b) of Form 10-K.

 ITEM 16.

 FORM 10-K SUMMARY

 None.

 SIGNATURES

 Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 LINCOLN EDUCATIONAL SERVICES CORPORATION

 By:

 /s/ Brian Meyers

 Brian Meyers

 Executive Vice President, Chief Financial Officer and Treasurer

 (Principal Accounting and Financial Officer)

 Date:

 POWER

 OF ATTORNEY

 KNOW ALL PERSONS BY THESE PRESENTS, that each of the undersigned constitutes and appoints Scott M. Shaw and Brian K.
 Meyers, and each of them, as attorneys-in-fact and agents, with full power of substitution and re-substitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments to this Annual
 Report on Form 10-K, and to file the same, with all exhibits thereto and all other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and
 perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that each of said
 attorney-in-fact or substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
 persons on behalf of the registrant and in the capacities and on the dates indicated.

 Signature

 Title

 Date

 /s/ Scott M. Shaw

 Chief Executive Officer and Director

 Scott M. Shaw

 /s/ Brian K. Meyers

 Executive Vice President, Chief Financial Officer and Treasurer (Principal Accounting and Financial Officer)

 Brian K. Meyers

 /s/ John A. Bartholdson

 Dire

 John A. Bartholdson

 /s/ James J. Burke, Jr.

 James J. Burke, Jr.

 /s/ Kevin M. Carney

 Kevin M. Carney

 /s/ Michael A. Plater

 Michael A. Plater

 /s/ Felecia J. Pryor

 Felecia J. Pryor

 /s/ Carlton Rose

 Carlton Rose

 /s/ Sylvia J. Young

 Sylvia J. Young

 /s/ Anna Cabral

 Anna Cabral

 /s/ Marta Newhart

 Marta Newhart

 INDEX TO CONSOLIDATED
 FINANCIAL STATEMENTS

 Page Number

 Reports of Independent Registered Public Accounting Firm - Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34)

 Consolidated Balance Sheets as of December 31, 2024 and 2023

 Consolidated Statements of Operations for the years ended December 31, 2024, 2023 and 2022

 Consolidated Statements of Other Comprehensive Income for the years ended December 31, 2024, 2023 and 2022

 Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders' Equity for the years ended December 31, 2024, 2023 and 2022

 Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023 and 2022

 Notes to Consolidated Financial Statements

 Schedule II-Valuation and Qualifying Accounts

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 To the shareholders and the Board of Directors of Lincoln Educational Services Corporation

 Opinion on the Financial Statements

 We have audited the accompanying consolidated balance sheets of Lincoln Educational Services Corporation and subsidiaries (the "Company") as of December 31, 2024
 and 2023, the related consolidated statements of operations, other comprehensive income, changes in convertible preferred stock and stockholders' equity, and cash flows, for each of the three years in the period ended December 31, 2024, and
 the related notes and the schedule listed in the Index at Item 15 (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the
 Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in with conformity accounting principles generally accepted in the United States
 of America.

 We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control
 over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway
 Commission and our report dated March 4, 2025, expressed an unqualified opinion on the Company's internal control over financial reporting.

 Basis for Opinion

 These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements
 based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the
 Securities and Exchange Commission and the PCAOB.

 We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance
 about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error
 or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the
 accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 Critical Audit Matter

 The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to
 be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the
 critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the
 accounts or disclosures to which it relates.

 Allowance for Credit Losses – Refer to Note 5 to the financial statements

 Critical Audit Matter Description

 Student receivables represent funds owed to the Company in exchange for the educational services provided to the student. Student receivables are reported net of
 an allowance for credit losses as determined by management at the end of each reporting period.

 Management's student receivable allowance is based on an estimate of lifetime expected credit losses for student receivables. Its estimation methodology
 considers a number of quantitative and qualitative factors that, based on collection experience, have an impact on repayment risk and ability to collect student receivables. Changes in the trends in any of these factors may impact the
 estimate of the allowance for credit losses. The factors include, but are not limited to repayment history, changes in the current economic, legislative, or regulatory environments, cash collection forecasts and the ability to complete the
 federal financial aid process with the student. These factors are monitored and assessed on a regular basis. Overall, the allowance estimation process for student receivables is assessed by comparing estimated and actual performance.

 Given the significant amount of judgment required by management in assessing the allowance for credit losses under Topic 326, performing audit procedures to
 evaluate the reasonableness of the estimate of the lifetime expected losses for student receivables required a high degree of auditor judgement and an increased extent of effort.

 How the Critical Audit Matter Was Addressed in the Audit

 Our audit procedures related to the allowance for credit losses included the following, among others:

 •

 Tested the design and operating effectiveness of controls relating to establishing the allowance for credit losses.

 •

 Assessed the appropriateness of management's methodology for calculating the allowance including the significant inputs and assumptions utilized, including any changes in the current economic,
 legislative or regulatory environments, cash collection forecasts and the ability to complete the federal financial aid process with the student.

 •

 Recalculated the estimated allowance rates applied to the respective accounts receivable allowance categories determined according to funding sources and other criteria.

 •

 Tested the completeness and accuracy of data underlying management's assertions and calculations by selecting and reperforming the calculations for a selection of students, and compared our
 recalculations to management's analysis to determine whether management's conclusions were reasonable.

 •

 Tested on a sample basis the rates of reserve percentages and subsequent cash collections from a student through our evaluation of a selection of students.

 •

 Evaluated Topic 326 related financial statement disclosures.

 /s/ Deloitte & Touche LLP

 Morristown, New Jersey

 We have served as the Company's auditor since 1999.

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 To the Stockholders and Board of Directors of Lincoln Educational Services
 Corporation

 Opinion on Internal Control over Financial Reporting

 We have
 audited the internal control over financial reporting of Lincoln Educational Services Corporation and subsidiaries (the "Company") as of December 31, 2024, based on criteria established in Internal
 Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over
 financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

 We have
 also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our report
 dated March 4, 2025, expressed an unqualified opinion on those financial statements.

 Basis for Opinion

 The Company's management is responsible for maintaining effective internal
 control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is
 to express an opinion on the Company's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with
 the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 We conducted our audit in accordance with the standards of the PCAOB. Those
 standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of
 internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other
 procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

 Definition and Limitations of Internal Control over Financial
 Reporting

 A company's internal control over financial reporting is a process designed 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. A company's internal control over
 financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
 reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made
 only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that
 could have a material effect on the financial statements.

 Because of its inherent limitations, internal control over financial reporting
 may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance
 with the policies or procedures may deteriorate.

 /s/ Deloitte & Touche LLP

 Morristown, New Jersey

 CONSOLIDATED
 BALANCE SHEETS

 (In thousands, except share amounts)

 2024

 2023

 ASSETS

 CURRENT ASSETS:

 Cash and cash equivalents

 $

 59,273

 $

 75,992

 Restricted cash

 -

 4,277

 Accounts receivable, less allowance of $ 42,615 and $ 34,441 at December 31, 2024
 and 2023, respectively

 42,983

 35,692

 Inventories

 3,053

 2,948

 Prepaid expenses and other current assets

 4,793

 5,556

 Asset held for sale

 1,150

 10,198

 Total current assets

 111,252

 134,663

 PROPERTY, EQUIPMENT AND FACILITIES - At cost, net of accumulated depreciation and amortization of $ 141,271
 and $ 140,161 at December 31, 2024
 and 2023, respectively

 103,533

 50,857

 OTHER ASSETS:

 Noncurrent receivables, less allowance of $ 22,957 and $ 19,370 at December 31, 2024
 and 2023, respectively

 19,627

 17,504

 Deferred finance charges

 -

 Deferred income taxes, net

 25,359

 23,217

 Operating lease right-of-use assets

 136,034

 89,923

 Finance lease right-of-use
 assets

 26,745

 15,797

 Goodwill

 10,742

 10,742

 Other assets, net

 1,387

 1,787

 Pension plan assets, net

 1,554

 Total other assets

 221,771

 159,729

 TOTAL ASSETS

 $

 436,556

 $

 345,249

 CONSOLIDATED BALANCE SHEETS

 (In thousands, except share amounts)

 (Continued)

 2024

 2023

 LIABILITIES, SERIES A CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY

 CURRENT LIABILITIES:

 Unearned tuition

 $

 30,631

 $

 26,906

 Accounts payable

 37,026

 18,152

 Accrued expenses

 11,986

 13,680

 Income taxes payable

 1,072

 2,832

 Current portion of operating lease liabilities

 9,497

 11,737

 Current portion of finance lease liabilities

 -

 Other short-term liabilities

 -

 Total current liabilities

 90,212

 73,410

 NONCURRENT LIABILITIES:

 Long-term portion of operating lease liabilities

 138,803

 88,853

 Long-term portion of finance lease liabilities

 29,261

 16,126

 Other long-term liabilities

 Total liabilities

 258,292

 178,445

 COMMITMENTS AND CONTINGENCIES

 SERIES A CONVERTIBLE PREFERRED STOCK

 Preferred stock, no par value - authorized 10,000,000 shares at December 31, 2024
 and 2023, respectively.

 -

 -

 STOCKHOLDERS' EQUITY:

 Common stock, no par value - authorized 100,000,000 shares at December 31, 2024
 and 2023, issued and outstanding 31,462,640 shares at December 31, 2024 and 31,359,110 shares at December 31, 2023

 48,181

 48,181

 Additional paid-in capital

 50,639

 49,380

 Retained earnings

 79,170

 69,279

 Accumulated other comprehensive loss (income)

 ( 36

)

 Total stockholders' equity

 178,264

 166,804

 TOTAL LIABILITIES, SERIES A CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY

 $

 436,556

 $

 345,249

 CONSOLIDATED
 STATEMENTS OF OPERATIONS

 (In thousands, except per share amounts)

 2024

 2023

 2022

 REVENUE

 $

 440,064

 $

 $

 348,287

 COSTS AND EXPENSES:

 Educational services and facilities

 181,759

 162,275

 148,746

 243,803

 209,135

 182,391

 Loss (gain) on sale of assets

 2,119

 ( 30,918

)

 ( 177

)

 Gain on insurance proceeds

 ( 2,794

)

 -

 -

 Impairment of goodwill and long-lived assets

 -

 4,220

 1,049

 Total costs and expenses

 424,887

 344,712

 332,009

 OPERATING INCOME

 15,177

 33,358

 16,278

 OTHER:

 Interest income

 2,099

 2,628

 Interest expense

 ( 2,565

)

 ( 347

)

 ( 160

)

 INCOME BEFORE INCOME TAXES

 14,711

 35,639

 16,436

 PROVISION FOR INCOME TAXES

 4,820

 9,642

 3,802

 NET INCOME

 9,891

 PREFERRED STOCK DIVIDENDS

 -

 -

 1,111

 INCOME AVAILABLE TO COMMON STOCKHOLDERS

 $

 9,891

 $

 $

 11,523

 Basic

 Net income per common share

 $

 0.32

 $

 0.86

 $

 0.36

 Diluted

 Net income per common share

 $

 0.32

 $

 0.85

 $

 0.36

 Weighted average number of common shares outstanding:

 Basic

 30,580

 30,105

 25,879

 Diluted

 30,891

 30,541

 25,879

 See Notes to Consolidated Financial Statements

 CONSOLIDATED S TATEMENTS OF OTHER
 COMPREHENSIVE INCOME

 (In thousands)

 2024

 2023

 2022

 $

 9,891

 $

 $

 Other comprehensive income

 Employee pension plan adjustments, net of taxes (a)

 Comprehensive income

 $

 10,201

 $

 26,921

 $

 12,914

 (a)

 Taxes related
 to pension plan adjustments were $ 0.1 million, $ 0.3 million, and $ 0.1 million for each of the years ended
 December 31, 2024, 2023, and 2022, respectively.

 See Notes to Consolidated Financial Statements

 CONSOLIDATED STATEMENTS OF
 CHANGES IN CONVERTIBLE PREFERRED STOCK

 AND STOCKHOLDERS' EQUITY

 (In thousands, except share amounts)

 Stockholders' Equity

 Accumulated

 Series A

 Additional

 Other

 Convertible

 Common Stock

 Paid-in

 Treasury

 Retained

 Comprehensive

 Preferred Stock

 Shares

 Amount

 Capital

 Stock

 Earnings

 Loss

 Total

 Shares

 Amount

 BALANCE - January 1, 2022

 27,000,687

 $

 141,377

 $

 32,439

 $

 ( 82,860

)

 $

 39,702

 $

 ( 1,240

)

 $

 129,418

 12,700

 $

 11,982

 -

 -

 -

 -

 -

 -

 -

 Preferred stock dividend

 -

 -

 -

 -

 ( 1,111

)

 -

 ( 1,111

)

 -

 -

 Preferred Stock Conversion

 5,381,356

 -

 11,982

 -

 -

 -

 11,982

 ( 12,700

)

 ( 11,982

)

 Employee pension plan adjustments

 -

 -

 -

 -

 -

 -

 -

 Stock-based compensation expense

 Restricted stock

 606,950

 -

 3,111

 -

 -

 -

 3,111

 -

 -

 Share repurchase

 ( 1,572,414

)

 ( 9,445

)

 -

 -

 -

 -

 ( 9,445

)

 -

 -

 Treasury stock cancellation

 -

 ( 82,860

)

 -

 82,860

 -

 -

 -

 -

 -

 Net share settlement for equity-based compensation

 ( 268,654

)

 -

 ( 1,992

)

 -

 -

 -

 ( 1,992

)

 -

 -

 BALANCE - December 31, 2022

 31,147,925

 49,072

 45,540

 -

 51,225

 ( 960

)

 144,877

 -

 -

 Net cumulative effect from adoption of ASC 326
 (a)

 -

 -

 -

 -

 ( 7,943

)

 -

 ( 7,943

)

 -

 -

 -

 -

 -

 -

 -

 -

 -

 Employee pension plan adjustments

 -

 -

 -

 -

 -

 -

 -

 Stock-based compensation expense

 Restricted stock

 713,299

 -

 5,894

 -

 -

 -

 5,894

 -

 -

 Share repurchase

 ( 165,064

)

 ( 891

)

 -

 -

 -

 -

 ( 891

)

 -

 -

 Net share settlement for equity-based compensation

 ( 337,050

)

 -

 ( 2,054

)

 -

 -

 -

 ( 2,054

)

 -

 -

 BALANCE - December 31, 2023

 31,359,110

 48,181

 49,380

 -

 69,279

 ( 36

)

 166,804

 -

 -

 -

 -

 -

 -

 9,891

 -

 9,891

 Employee pension plan adjustments

 -

 -

 -

 -

 -

 Stock-based compensation expense

 Restricted stock

 434,256

 -

 4,629

 -

 -

 -

 4,629

 Share repurchase

 -

 -

 -

 -

 -

 -

 -

 Net share settlement for equity-based compensation

 ( 330,726

)

 -

 ( 3,370

)

 -

 -

 -

 ( 3,370

)

 BALANCE - December 31, 2024

 31,462,640

 $

 48,181

 $

 50,639

 $

 -

 $

 79,170

 $

 $

 178,264

 -

 $

 -

 (a) Net cumulative adjustment to equity based on the adoption of Accounting Standards Update No. 2016-13 Financial Instruments - Credit Losses. See Note 5 to the Consolidated Financial Statements.

 CONSOLIDATED

 STATEMENTS OF CASH FLOWS

 (In thousands)

 2024

 2023

 2022

 CASH FLOWS FROM OPERATING ACTIVITIES:

 $

 9,891

 $

 $

 Adjustments to reconcile net income to net cash provided by operating activities:

 Depreciation and amortization

 11,334

 6,596

 6,362

 Amortization of deferred finance fees

 -

 -

 Finance lease amortization

 1,622

 -

 Deferred income taxes

 ( 2,242

)

 1,632

 1,294

 Loss on sale of assets

 2,119

 ( 30,918

)

 ( 177

)

 Gain on insurance proceeds

 ( 2,794

)

 -

 -

 Proceeds from insurance

 2,794

 -

 -

 Impairment of goodwill and long-lived assets

 -

 4,220

 1,049

 Fixed asset donation

 ( 277

)

 ( 239

)

 ( 408

)

 Provision for credit losses

 56,578

 41,637

 34,915

 Stock-based compensation expense

 4,629

 5,894

 3,111

 (Increase) decrease in assets:

 Accounts receivable

 ( 65,984

)

 ( 45,757

)

 ( 48,637

)

 Inventories

 ( 184

)

 ( 330

)

 Prepaid expenses and current assets

 ( 687

)

 ( 11

)

 Other assets

 1,041

 Increase (decrease) in liabilities:

 Accounts payable

 11,583

 5,039

 ( 2,033

)

 Accrued expenses

 ( 1,667

)

 5,027

 ( 7,016

)

 Unearned tuition

 3,770

 2,752

 ( 1,251

)

 Income taxes payable

 ( 1,760

)

 1,038

 Other liabilities

 1,115

 ( 541

)

 Total adjustments

 19,415

 ( 439

)

 ( 11,752

)

 Net cash provided by operating activities

 29,306

 25,558

 CASH FLOWS FROM INVESTING ACTIVITIES:

 Capital expenditures

 ( 56,866

)

 ( 40,699

)

 ( 8,986

)

 Proceeds from sale of property and equipment

 9,895

 33,310

 2,390

 Proceeds from sale of short-term investments

 -

 39,102

 -

 Purchase of short-term investments

 -

 ( 24,344

)

 ( 14,758

)

 Net cash (used in) provded by investing activities

 ( 46,971

)

 7,369

 ( 21,354

)

 CASH FLOWS FROM FINANCING ACTIVITIES:

 Payment of deferred finance fees

 ( 456

)

 -

 -

 Net share settlement for equity-based compensation

 ( 3,370

)

 ( 2,054

)

 ( 1,992

)

 Dividend payment for preferred stock

 -

 -

 ( 1,111

)

 Finance lease principal

 ( 267

)

 -

 -

 Tenant allowance finance leases

 -

 -

 Share repurchase

 -

 ( 891

)

 ( 9,445

)

 Net cash used in financing activities

 ( 3,331

)

 ( 2,945

)

 ( 12,548

)

 NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

 ( 20,996

)

 29,982

 ( 33,020

)

 CASH, CASH EQUIVALENTS AND RESTRICTED CASH—Beginning of year

 80,269

 50,287

 83,307

 CASH, CASH EQUIVALENTS AND RESTRICTED CASH—End of year

 $

 59,273

 $

 80,269

 $

 50,287

 CONSOLIDATED STATEMENTS OF CASH FLOWS

 (In thousands)

 (Continued)

 2024

 2023

 2022

 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

 Cash paid during the year for:

 Interest

 $

 2,354

 $

 $

 Income taxes

 $

 8,836

 $

 7,201

 $

 1,471

 SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:

 Liabilities accrued for or noncash purchases of property and equipment

 $

 8,181

 $

 3,522

 $

 1,300

 NOTES

 TO CONSOLIDATED FINANCIAL STATEMENTS

 AS OF DECEMBER 31, 2024, 2023, AND 2022 AND FOR THE THREE YEARS ENDED DECEMBER 31, 2024

 (In thousands, except share and per share amounts, schools, campuses and unless otherwise stated)

 1.

 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 postsecondary education to recent high school graduates and working adults. The Company, which currently operates 21 campuses in 12 states, has entered into leases for two new campuses: one in Houston, Texas, with programs expected to begin in the second half of 2025, and one in Hicksville, New York, with programs expected to begin by the end of 2026. Lincoln Educational Services Corporation offers programs in skilled trades (which include Heating
 Ventilation and Air Conditioning ("HVAC"), welding and computerized numerical control and electrical and electronic systems technology, among other programs), automotive technology, healthcare services (which include nursing,
 dental assistant and medical assistant, among other programs) and hospitality services and information technology (which include culinary and aesthetics and information technology programs). The schools operate under the brands Lincoln
 Technical Institute, Lincoln College of Technology and Nashville Auto Diesel College.

 Most of the Company's 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 accredited and are eligible to participate in federal
 financial aid programs administered 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. The Company was incorporated in New Jersey in 2003 as the successor-in-interest to various acquired schools including Lincoln Technical Institute, Inc. which opened its first campus in Newark, New Jersey in 1946.

 The Company manages its business, evaluates performance and allocates resources
 based on two reportable business segments, Campus Operations and Transitional:

 Campus Operations - The Campus Operations segment
 includes campuses that are continuing in operation and contribute to the Company's core operations and performance. All of the campuses
 continuing in operation are classified in this segment. The majority of the campuses offer programs across various areas of study.

 Transitional – The Transitional segment refers to campuses that are marked for closure and are currently being taught-out, in addition to campuses that are held-for-sale or sold. As of December 31, 2024, the
 net assets for the Summerlin, Las Vegas campus were classified as held for sale, with operating results classified within the
 Transitional segment. The sale of the campus was consummated effective January 1, 2025. In addition, the Company closed the Somerville,
 Massachusetts campus in the prior year. It was fully taught-out as of December 31, 2023. This campus is classified in the Transitional segment in the prior year's statement of operations.

 Liquidity —As of
 December 31, 2024, the Company had $ 59.3 million in cash and cash equivalents compared to $ 80.3 million in cash and cash equivalents and restricted cash in the prior year. The Company believes that its likely sources of cash should be sufficient to fund operations
 for the next 12 months and thereafter for the foreseeable future.

 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.

 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 DOE's cash management requirements, the Company retains funds from financial aid programs under Title IV of the Higher Education Act of 1965 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 sheets.

 Restricted Cash –
 Restricted cash consists of cash currently utilized as collateral for the Company's letters of credit.

 Short-term Investments –
 Short-term investments not considered cash and cash equivalents are investments with maturity dates of three months to 12 months from the date of purchase.

 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 represents amounts due from
 graduates in excess of 12 months from the balance sheet date.

 Allowance for Credit Losses— On

 January 1, 2023, the Company adopted Accounting Standards Update ("ASU") 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. As a result of
 the adoption, the Company has revised the way in which it calculates reserves on outstanding student accounts receivable balances. Details considered by management in the estimate include the following:

 We extend credit to a portion of the students who are enrolled at our academic institutions for tuition and certain other educational costs. Based upon past experience and judgment, we
 establish an allowance for credit losses with respect to student receivables which we estimate will ultimately not be collectible. Our standard student receivable allowance is based on an estimate of lifetime expected credit losses for student
 receivables that considers vintages of receivables to determine a loss rate. Our estimation methodology considers a number of quantitative and qualitative factors that, based on our collection experience, we believe have an impact on our
 repayment risk and ability to collect student receivables. Changes in the trends in any of these factors may impact our estimate of the allowance for credit losses. These factors include, but are not limited to: internal repayment history,
 changes in the current economic, legislative or regulatory environments, internal cash collection forecasts and the ability to complete the federal financial aid process with the student. These factors are monitored and assessed on a regular
 basis. Overall, our allowance estimation process for student receivables is validated by trending analysis and comparing estimated and actual performance. The Company evaluates its provision for credit losses on at least a quarterly basis, considering factors such as micro and macro-economic conditions, the current political climate, and other industry factors.

 Management makes a series of assumptions to determine what is believed to be the appropriate level of allowance for credit losses. Management determines a reasonable and supportable
 forecast based on the expectation of future conditions over a supportable forecast period as described above, as well as qualitative adjustments based on current and future conditions that may not be fully captured in the historical modeling
 factors described above. All of these estimates are susceptible to significant change.

 We monitor our collections and write-off experience to assess whether or not adjustments to our allowance percentage estimates are necessary. Changes in trends in any of the factors
 that we believe impact the collection of our student receivables, as noted above, or modifications to our collection practices, and other related policies may impact our estimate of our allowance for credit losses and our results from
 operations.

 Because a substantial portion of our revenue is derived from Title IV Programs, any legislative or regulatory action that significantly reduces the funding available under Title IV
 Programs, or the ability of our students or institutions to participate in Title IV Programs, would likely have a material impact on the realizability of our receivables.

 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 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.

 Asset Retirement
 Obligation— Lincoln recognizes and records an asset retirement obligation ("ARO") if there is a clear obligation at the
 termination of a lease, and the potential obligation is measurable in both potential cost and time. If both conditions are met Lincoln will record the ARO at the Present Value ("PV") of the future obligation and incur accretion expense over
 the course of the term, using the lease end date as the termination date. Should the components or assumptions used to assess the ARO materially change, the ARO is re-measured, and adjustments recorded.

 Advertising Costs—Costs related to advertising are expensed as incurred and are approximately $ 43.3 million, $ 38.2 million, and $ 35.0 million for the
 years ended December 31, 2024, 2023, and 2022, respectively. These amounts are included in selling, general and administrative expenses in the Consolidated Statements of Operations.

 Goodwill —Goodwill represents the excess of purchase price over the fair value of tangible net assets and identifiable intangible assets of the
 businesses acquired. Lincoln tests goodwill for impairment annually, in the fourth quarter of each year, unless there are events or changes in circumstances that indicate an impairment may have occurred. Impairment may result from
 deterioration in performance, adverse market conditions, adverse changes in laws or regulations, the restriction of activities associated with the acquired business, and/or a variety of other circumstances. If we determine that impairment has
 occurred, we record a write-down of the carrying value and charge the impairment as an operating expense in the period the determination is made.

 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. For other long-lived assets, including right-of-use ("ROU") lease
 assets, the Company evaluates assets for recoverability when there is an indication of potential impairment. Factors the Company considers important, which could trigger an impairment review, include significant changes in the manner of the use
 of the asset, significant changes in historical trends in operating performance, significant changes in projected operating performance, and significant negative economic trends. If the undiscounted cash flows from a group of assets being
 evaluated is less than the carrying value of that group of assets, the fair value of the asset group is determined and the carrying value of the asset group is written down to fair value.

 When we perform the quantitative impairment test for long-lived
 assets, we examine 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.

 On December 31, 2024, as a result of impairment testing, it was determined that there was no impairment of long-lived assets.

 On June 8, 2023, the Company consummated the sale of its Nashville, Tennessee property. See "Note 8, Real Estate Transactions." The result of the sale created a change in the
 trajectory of the fair value of the Nashville, Tennessee operations, and as such, the Company recorded a pre-tax non-cash impairment charge of $ 0.4
 million relating to long-lived assets.

 On December 31, 2022, as a result of impairment testing, it was determined that there was a long-lived asset impairment of $ 1.0 million. The impairment was the result
 of an assessment of the current market value, as compared to the carrying value of the assets.

 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 Corporation ("FDIC") limit of $ 0.25 million. The Company's cash balances on deposit as of December 31, 2024, exceeded the balance insured by the FDIC by approximately $ 58.7 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 by 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 each of December 31, 2024 and 2023, respectively.

 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 used to determine the incremental borrowing rate to calculate lease liabilities and ROU assets, lease term to calculate lease cost, revenue recognition, bad debts,
 impairments, fixed assets, income taxes, benefit plans, stock-based compensation, and certain accruals. Actual results could differ from those estimates.

 Income Taxes—The Company accounts for
 income taxes in accordance with Accounting Standards Codification ("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 considers, 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.

 On August
 16, 2022, the Inflation Reduction Act was enacted and signed into law. The Inflation Reduction Act is a budget reconciliation package that includes significant changes relating to tax, climate change, energy and health care. The income tax
 provision of the act includes, among other items, a corporate alternative minimum tax of 15.0%, an excise tax of 1.0% on corporate stock buybacks, energy-related tax credits, and additional IRS funding. The tax provisions of the Inflation
 Reduction Act have not had a material impact on the Company's Consolidated Financial Statements.

 We recognize accrued interest and penalties related to unrecognized tax benefits in income tax expense. During the fiscal years ended December 31, 2024, 2023, and 2022, we did no t record any interest and penalties expense associated with uncertain tax positions, as we do no t have any uncertain tax positions.

 Start-up Costs—Costs related to the start of new campuses are expensed as incurred.

 New Accounting Pronouncements– In November 2024, the Financial Accounting Standards Board ("FASB")
 issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Topic 220); Disaggregation of Income Statement Expenses, which requires additional disclosure
 of certain amounts included in the expense captions presented on the statement of operations, as well as disclosures about selling expenses. The ASU is effective on a prospective basis, with the option for retrospective application for periods
 beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted for annual financial statements that have not yet been issued. The Company is currently evaluating the impact this
 ASU will have on our financial statement disclosures.

 In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable
 Segment Disclosures, which provides updates to qualitative and quantitative reportable segment disclosure requirements, including enhanced disclosures about significant segment expenses and increased interim disclosure requirements,
 among others. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. As required in this ASU, the Company has adopted the new
 disclosure requirements retrospectively within Note 16 to the Consolidated Financial Statements.

 In December 2023, FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this ASU require that public business entities on an annual basis 1) disclose specific categories in the rate reconciliation, and 2) provide additional
 information for reconciling items that meet a quantitative threshold. The amendments require disclosure about income taxes paid by federal, state and foreign taxes, and by individual jurisdictions in which income taxes paid is equal or greater
 than 5 percent of total income taxes paid. The amendment also requires entities to disclose income or loss from continuing operations before income tax expense disaggregated between domestic and foreign and income tax expense or benefit from
 continuing operations disaggregated by federal, state and foreign. For all public business entities, ASU 2023-09 is effective for annual periods beginning after December 15, 2024; early adoption is permitted. This ASU has not had a material
 impact to the Consolidated Financial Statements.

 In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of
 Credit Losses on Financial Instruments and subsequently issued additional guidance that modified ASU 2016-13. The ASU and the subsequent modifications were identified as Accounting Standard Codification ("ASC") Topic 326. The standard
 requires an entity to change its accounting approach in determining impairment of certain financial instruments, including trade receivables, from an "incurred loss" methodology to a "current expected credit loss" methodology (the "CECL
 methodology"). The CECL methodology utilizes a lifetime "expected credit loss" measurement objective for the recognition of credit losses on financial assets measured at amortized cost at the time the financial asset is originated or acquired. The
 allowance is adjusted each period for changes in expected lifetime credit losses. The CECL methodology represents a significant change from prior U.S. GAAP, which generally required that a loss be incurred before it was recognized. Further, the
 FASB issued ASU No. 2019-04, ASU No. 2019-05, ASU No. 2019-11 and ASU No. 2022-02 to provide additional guidance on the credit losses standard. In November 2019, FASB issued ASU No. 2019-10, Financial Instruments –
 Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842). This ASU deferred the effective date of ASU 2016-13 for public companies that are considered smaller reporting companies as defined by the SEC to
 fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Additionally, in February and March 2020, the FASB issued ASU 2020-02, Financial Instruments—Credit Losses
 (Topic 326) and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842). ASU
 2020-02 added an SEC paragraph pursuant to the issuance of SEC Staff Accounting Bulletin No. 119 on loan losses to FASB Codification Topic 326 and also updated the SEC section of the codification for the change in the effective date of Topic 842.
 As of the January 1, 2023 date of adoption, based on forecasts of macroeconomic conditions and exposures at that time, the aggregate impact to the Company resulted in an opening balance sheet adjustment increasing the allowance for credit losses
 related to the Company's accounts receivables of approximately $ 10.8 million, a decrease in retained earnings of $ 7.9 million, after-tax and a deferred tax asset increase of $ 2.9 million.

 2.

 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 for 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 DOE.
 During the fiscal years ended December 31, 2024, 2023, and 2022, approximately 82 %, 81 %, and 74 %, respectively, of net revenues on a cash basis were
 indirectly derived from funds distributed under Title IV Programs.

 For the fiscal years ended December 31, 2024, 2023, and 2022, the Company calculated that no individual DOE reporting entity received more than 90 % of its revenue, determined on a cash basis pursuant to 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% of its total revenue for a single fiscal year, will be placed in provisional certification status 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

 All institutions participating in Title
 IV Programs must satisfy specific standards of financial responsibility. The DOE evaluates institutions for compliance with these standards each year, based on 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
 most significant financial responsibility measurement is the institution ' s composite score, which is calculated by the DOE based on three ratios:

 •

 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

 •

 the

 net income ratio, which measures the institution ' s ability to operate at a profit.

 The DOE assigns a
 strength factor to the results of each of these ratios on a scale from negative 1.0 to positive 3.0, with negative 1.0 reflecting
 financial weakness and positive 3.0 reflecting financial strength. The DOE then assigns a weighting percentage to each ratio and adds
 the weighted scores for the three ratios together to produce a composite score for the institution. 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 an institution is required to make disbursements to students under the Heightened Cash Monitoring 1 ("HCM1") payment method, or a
 different payment method other than the advance 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 equal to 50 percent of the Title IV Program funds received
 by the institution during its most recent fiscal year. The DOE permits an institution to participate under the "Zone Alternative" for a period of up to three
 consecutive fiscal years. Under the HCM1 payment method, the institution is required to make Title IV Program 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, an institution is 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 the 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 Program
 funds. 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 provides written authorization for the school to hold the credit balance.

 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 eligibility to participate in the Title IV Programs on an alternative basis by, among other things:

 •

 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; or

 •

 posting a letter of credit in an amount equal to at least 10 % of the Title IV Program funds
 received by the institution during its most recently completed fiscal year accepting provisional certification status; 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.

 For the 2024, 2023, and 2022 fiscal years, we calculated our composite score to be 2.5,
 3.0, and 2.9,
 respectively. These scores are subject to determination by the DOE based on its review of our consolidated audited financial statements for the 2023 and 2022 fiscal years, but we believe it is likely that the DOE will determine that our
 institutions comply with the composite score requirement.

 3.

 NET INCOME PER COMMON SHARE

 Basic and diluted earnings per share ("EPS") are determined in accordance with ASC Topic 260, " Earnings per Share ", which specifies the computation, presentation and disclosure
 requirements for EPS. Basic EPS excludes all dilutive Common Stock equivalents. It is based upon the weighted average number of common shares outstanding during the period. Diluted EPS, as calculated using the treasury stock method, reflects the
 potential dilution that would occur if our dilutive outstanding stock options and stock awards were issued.

 During the year ended December 31, 2022, the Company presented its basic and diluted
 income per common share using the two-class method, which requires all outstanding Series A Preferred Stock ("Series A Preferred Stock") and unvested shares of Restricted Stock that contain rights to non-forfeitable dividends and therefore
 participate in undistributed income with common shareholders to be included in computing income per common share. Under the two-class method, net income is reduced by the amount of dividends declared in the period for each class of Common Stock
 and participating security. The remaining undistributed income is then allocated to Common Stock and participating securities based on their respective rights to receive dividends. Series A Preferred Stock and shares of unvested Restricted
 Stock contain non-forfeitable rights to dividends on an if-converted basis and on the same basis as shares of the Company's Common Stock, respectively, and are considered participating securities. The Series A Preferred Stock and unvested
 Restricted Stock are not included in the computation of basic income per common share in periods in which we have a net loss, as the Series A Preferred Stock and unvested Restricted Stock are not contractually obligated to share in our net
 losses. However, the cumulative dividends on Series A Preferred Stock for the period decreases the income or increases the net loss allocated to common shareholders unless the dividend is paid in the period. Basic income per common share has
 been computed by dividing net income allocated to common shareholders by the weighted-average number of common shares outstanding.

 On November 30, 2022, the Company exercised in full its right of mandatory conversion of the Company's Series A Preferred Stock. In connection with the conversion, each
 share of Series A Preferred Stock was cancelled and converted into 423.729 shares of the Company's Common Stock, no par value per share (the "Common Stock"). No
 shares of Series A Preferred Stock remain outstanding and all rights of the holders to receive future dividends have been terminated. As a result of the conversion, the aggregate 12,700 shares of Series A Preferred Stock outstanding were converted into 5,381,356
 shares of Common Stock. As of December 31, 2024, the Company still maintains Restricted Stock, but these shares do not participate in the disbursement of dividends.

 The following is a reconciliation of the numerator and denominator of the net income per share computations for the years ended December 31, 2024, 2023, and 2022:

 (in thousands, except share data)

 2024

 2023

 2022

 Numerator:

 $

 9,891

 $

 $

 Less: preferred stock dividend

 -

 -

 ( 1,111

)

 Less: allocation to preferred stockholders

 -

 -

 ( 1,753

)

 Less: allocation to restricted stockholders

 -

 -

 ( 559

)

 Net income allocated to common stockholders

 $

 9,891

 $

 $

 9,211

 Basic net income per share:

 Denominator:

 Weighted average common shares outstanding

 30,580,381

 30,105,194

 25,879,483

 Basic net income per share

 $

 0.32

 $

 0.86

 $

 0.36

 Diluted net income per share:

 Denominator:

 Weighted average number of:

 Common shares outstanding

 30,890,790

 30,540,628

 25,879,483

 Dilutive shares outstanding

 30,890,790

 30,540,628

 25,879,483

 Diluted net income per share

 $

 0.32

 $

 0.85

 $

 0.36

 The following table summarizes the potential weighted average shares of Common Stock that were excluded from the determination of our diluted shares outstanding as
 they were anti-dilutive:

 2024

 2023

 2022

 Unvested restricted stock

 -

 -

 516,233

 -

 -

 516,233

 4.

 REVENUE RECOGNITION

 Substantially all of our revenues are considered to be revenues from contracts with students. We determine standalone selling price based on the price at which the distinct services or goods are sold
 separately. The related accounts receivable balances are recorded in our balance sheets as student accounts receivable. We do not have significant revenue recognized from performance obligations that were satisfied in prior periods, and we do not
 have any transaction price allocated to unsatisfied performance obligations other than in our unearned tuition. We record revenue for students who withdraw from our schools only to the extent that it is probable that a significant reversal in the
 amount of cumulative revenue recog nized will not occur. In addition, to reduce the amount of outstanding accounts receivable balances due
 from our students, the Company employs a continuous collection effort. Unearned tuition
 represents contract liabilities primarily related to our tuition revenue. We have assessed the costs incurred to obtain a contract with a student and determined them to be immaterial.

 Unearned tuition in the amount of $ 30.6 million and $ 26.9 million is recorded in the current liabilities section of the accompanying Consolidated Balance Sheets as of December 31, 2024 and 2023,
 respectively. The change in this contract liability balance during the fiscal year ended December 31, 2024 is the result of payments received in advance of satisfying performance obligations, offset by revenue recognized during that period. Revenue
 recognized for the fiscal year ended December 31, 2024 that was included in the contract liability balance at the beginning of the year was $ 26.0
 million.

 The following table depicts the timing of revenue recognition by segment:

 Year ended December 31, 2024

 Campus

 Operations

 Consolidated

 Timing of Revenue Recognition

 Services transferred at a point in time

 $

 26,877

 $

 1,180

 $

 28,057

 Services transferred over time

 406,089

 5,918

 412,007

 Total revenues

 $

 432,966

 $

 7,098

 $

 440,064

 Year ended December 31, 2023

 Campus

 Operations

 Consolidated

 Timing of Revenue Recognition

 Services transferred at a point in time

 $

 21,403

 $

 1,534

 $

 22,937

 Services transferred over time

 345,830

 9,303

 355,133

 Total revenues

 $

 367,233

 $

 10,837

 $

 Year ended December 31, 2022

 Campus

 Operations

 Consolidated

 Timing of Revenue Recognition

 Services transferred at a point in time

 $

 19,591

 $

 2,131

 $

 21,722

 Services transferred over time

 311,305

 15,260

 326,565

 Total revenues

 $

 330,896

 $

 17,391

 $

 348,287

 5.

 STUDENT RECEIVABLES

 Student receivables represent funds owed to us in exchange for the educational
 services provided to a student. Student receivables are reflected net of an allowance for credit losses at the end of the reporting period. Student receivables, net, are reflected on our Consolidated Balance Sheets as components of both current and
 non-current assets.

 Our students pay for their costs through a variety of funding sources, including federal loan and grant programs,
 institutional payment plans, Veterans Administration and other military funding and grants, private and institutional scholarships and cash payments. Cash receipts from government-related sources are typically received during the current academic
 term. Students who have not applied for any type of financial aid generally set up a payment plan with the institution and make payments on a monthly basis as per the terms of the payment plan. A student receivable balance is written off when
 deemed uncollectable, which is typically once a student is out of school and there has been no payment activity on the account for 150 days.

 If, however, the student does remit a payment during this time period, the 150-day policy for write-off starts again until either (1)
 the student continues making payments, or (2) the student does not make any additional payments after which the student receivable balance is written off after 150 days. In an effort to reduce the risk for writing off a student's account, the Company employs a continuous collection effort to minimize
 exposure from outstanding receivables.

 Students enrolled in the Company's programs are provided with a variety of funding
 resources, including financial aid, grants, scholarships and private loans. After exhausting all fund options, if the student is still in need of additional financing, the Company may offer an institutional loan as a lender of last resort.

 Our standard student receivable allowance is based on an estimate of lifetime
 expected credit losses on student receivables that considers vintages of receivables to determine a loss rate. In considering lifetime credit losses, if the expected life goes beyond the Company's reasonable ability to forecast, the Company then
 reverts back to historical loss experience as an indicator of collections. In determining the expected credit losses for the period, student receivables were disaggregated and pooled into two different categories to refine the calculation. Other
 information considered included external factors outside the Company's control. Given that collection history during the COVID-19 pandemic was not considered to be a reliable indicator of a student's repayment history, the Company adjusted the
 historical loss calculation by normalizing the financial data relating to that time period. Our estimation methodology further considered a number of quantitative and qualitative factors that, based on our collection experience, we believe have an
 impact on our repayment risk and ability to collect student receivables. Changes in the trends in any of these factors may impact our estimate of the allowance for credit losses. These factors include, but are not limited to: internal repayment
 history, student status, changes in the current economic condition, legislative or regulatory environments, internal cash collection forecasts and the ability to complete the federal financial aid process with the student. These factors are
 monitored and assessed on a regular basis. Overall, our allowance estimation process for student receivables is validated by trending analysis and comparing estimated and actual performance.

 Student Receivables

 The Company has student receivables that are due greater than 12 months from the
 date of our Consolidated Balance Sheets. As of December 31, 2024, and December 31, 2023, the amount of non-current student receivables under payment plans that is longer than 12 months in duration, net of allowance for credit losses, was $ 19.6 million and $ 17.5 million,
 respectively.

 The following table presents the amortized cost basis of student receivables as of
 December 31, 2024 and 2023 by year of origination.

 Year Ended

 Year Ended

 December 31, 2024

 December 31, 2023

 Student

 Student

 Year

 Receivables (1)

 Write-Off's (2)

 Year

 Receivables (1)

 Write-Off's (2)

 2024

 $

 96,459

 $

 12,970

 2023

 $

 77,113

 $

 9,540

 2023

 14,231

 26,345

 2022

 12,548

 19,731

 2022

 6,815

 3,216

 2021

 6,799

 3,194

 2021

 3,999

 1,311

 2020

 3,036

 2020

 1,597

 2019

 2,019

 Thereafter

 1,401

 Thereafter

 1,031

 Total

 $

 124,502

 $

 44,817

 Total

 $

 102,546

 $

 34,037

 (1)

 Student receivables are presented on a gross basis from the individual students. The
 total receivable amount above excludes federal subsidies reflected on the students' accounts but not yet received from the government. Also, it excludes all receivables from industry relationships, which are otherwise
 included under accounts receivable in our Consolidated Balance Sheets.

 (2)

 Write-off amounts are based on the students school departure year.

 The Company does not utilize or maintain data pertaining to student credit
 information.

 Allowance for Credit Losses

 We define student receivables as a portfolio segment under ASC Topic 326. Changes

 in our current and non-current allowance for credit losses related to our student receivable portfolio are calculated in accordance with the guidance effective January 1, 2023 under CECL for the year ended December 31, 2024 and 2023,
 respectively.

 2024

 2023

 Balance, beginning of period

 $

 $

 35,370

 Cumulative effect of ASC Topic 326

 -

 10,841

 Adjusted beginning of period balance

 46,211

 Provision for credit losses

 56,578

 41,637

 Write-off's

 ( 44,817

)

 ( 34,037

)

 Balance, at end of period

 $

 65,572

 $

 Fair Value Measurements

 The carrying amount reported in our Consolidated Balance Sheets for the current
 portion of student receivables approximates fair value because of the nature of these financial instruments as they generally have short maturity periods. It is not practicable to estimate the fair value of the non-current portion of student
 receivables, since observable market data is not readily available, and no reasonable estimation methodology exists.

 6.

 LEASES

 The Company determines if an arrangement is a lease at its inception. The Company considers any contract where there is an identified asset as to which the Company has
 the right to control its use in determining whether the contract contains a lease. An operating lease ROU asset represents the Company's right to use an underlying asset for the lease term and lease liabilities represent its obligation to make
 lease payments arising from the lease. Operating lease ROU assets and liabilities are to be recognized at the commencement date based on the present value of lease payments over the lease term. As all of the Company's operating leases do not
 provide an implicit rate, the Company uses an incremental borrowing rate based on the information available on the commencement date in determining the present value of lease payments. We estimate the incremental borrowing rate based on a yield
 curve analysis, utilizing the interest rate derived from the fair value analysis of our credit facility and adjusting it for factors that appropriately reflect the profile of secured borrowing over the expected term of the lease. The operating
 lease ROU assets include any lease payments made prior to the rent commencement date and exclude lease incentives. Our leases have remaining lease terms of one year to 21 years. Lease terms may include options to extend the lease term
 used in determining the lease obligation when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments are recognized on a straight-line basis over the lease term for operating leases.

 On December 12, 2024, the Company entered into a lease for
 approximately 65,000 square feet of space to serve as the Company's new campus in Hicksville, New York. The lease term is
 currently planned to commence on or about May 1, 2025, with an initial lease term of 15 years and 9 months. The lease contains a renewal option allowing for either a 10-year renewal or two five-year renewals. The
 Company signed the lease commitment on January 1, 2025. However, the Company will not take possession until the lease commencement date.

 On October 31, 2023, the
 Company entered into a lease for approximately 100,000 square feet of space to serve as the Company's new campus in Houston, Texas.
 The lease term commenced on January 2, 2024, with an initial lease term of 21 years and 6 months. The lease contains three five-year renewal options.

 On October 18, 2023,
 the Company entered into a lease for approximately 120,000 square feet of space. to serve as the Company's new Nashville, Tennessee
 campus. The lease term commenced on November 1, 2023, with an initial lease term of 15 years. The lease contains two five-year renewal options. See
 Note 8, "Real Estate Transactions".

 On September 28, 2023, the Company purchased a 90,000 square foot property located at 311 Veterans Highway, Levittown, Pennsylvania for approximately $ 10.2 million. On January 30, 2024, the Company entered into a sale-leaseback transaction for this property. See Note 8, "Real Estate Transactions". As of December 31, 2023,
 this property was classified as held-for-sale on the Consolidated Balance Sheets.

 On November 3, 2022,
 the Board of Directors approved a plan to close the Somerville, Massachusetts campus, which as of December 31, 2023 was fully taught-out.

 On June 30, 2022, the Company executed a lease for approximately 55,000 square feet of space to serve as the Company's new campus in East Point, Georgia. The lease term commenced in August 2022, with total payments due on an undiscounted basis of $ 12.2 million over the 12-year initial
 term. The lease contains two five-year
 renewal options that may be exercised by the Company at the end of the initial lease term. The Company had no involvement in the construction or design of the facilities on the property and was not deemed to be in control of the asset prior to
 the lease commencement date.

 The following table presents
 components of lease cost and classification on the Consolidated Statement of Operations:

 in thousands

 Consolidated Statement of Operations Classification

 2024

 2023

 2022

 Operating Lease Cost

 $

 19,665

 $

 19,235

 $

 18,943

 Finance lease cost

 Amortization of leased assets

 Depreciation and amortization

 1,622

 -

 Interest on lease Liabilities

 Interest expense

 2,155

 -

 Variable lease cost

 $

 23,865

 $

 20,109

 $

 18,998

 The net change in ROU asset and operating lease liability is included in the net change in other assets in the Consolidated Statements of Cash Flows for the fiscal years ended
 December 31, 2024, 2023, and 2022.

 The net change in ROU asset and finance lease liability is split between principal payments, interest expense and amortization expense. Principal payments are classified in the
 financing section, interest expense is included in net income and amortization expense is broken out separately in the operating section of the Consolidated Statements of Cash Flows.

 Supplemental cash flow information and non-cash activity related to our
 leases are as follows:

 2024

 2023

 2022

 Cash flow information:

 Cash paid for amounts included in the measurement of lease liabilities

 Operating Cash Flows - operating leases

 $

 17,989

 $

 16,103

 $

 18,443

 Operating Cash Flows - finance leases

 $

 2,155

 $

 -

 $

 -

 Financing Cash Flows - finance leases

 $

 $

 -

 $

 -

 Non-cash activity:

 Lease liabilities arising from obtaining right-of-use assets

 Operating leases

 $

 59,061

 $

 10,477

 $

 13,820

 Finance leases

 $

 12,570

 $

 15,971

 $

 -

 During the fiscal year ended December 31, 2024, the Company entered into one new operating lease, one new finance lease and eleven lease modifications. The Company obtained the operating and finance ROU asset in exchange for an operating and finance lease liability of
 $ 15.7 million and $ 12.6
 million, respectively. In addition, the eleven lease modifications resulted in a noncash re-measurement of the related ROU asset
 and operating lease liability of $ 43.3 million.

 Weighted-average remaining lease term and discount rate for our leases are as follows:

 Year Ended

 2024

 2023

 Weighted-average remaining lease term

 Operating leases

 12.81 years

 11.16 years

 Finance leases

 16.40 years

 15.09 years

 Weighted-average discount rate

 Operating leases

 6.60 %

 6.89 %

 Finance leases

 7.69 %

 8.39 %

 Maturities of lease liabilities by fiscal year for our leases as of December 31, 2024 are as follows:

 As of December 31, 2024

 Operating Leases

 Finance Leases

 Year ending December 31,

 2025

 $

 18,404

 $

 2026

 18,976

 2,817

 2027

 18,188

 2,918

 2028

 18,948

 3,023

 2029

 17,237

 3,132

 Thereafter

 131,509

 43,417

 Total lease payments

 223,262

 55,813

 Less: imputed interest

 ( 74,962

)

 ( 26,552

)

 Present value of lease liabilities

 $

 148,300

 $

 29,261

 7.

 GOODWILL

 Changes in the carrying amount of goodwill during the fiscal years ended December 31, 2024 and 2023 are as follows:

 Gross

 Goodwill

 Balance

 Accumulated

 Impairment

 Losses

 Net

 Goodwill

 Balance

 Balance as of January 1, 2023

 $

 117,176

 $

 ( 102,640

)

 $

 14,536

 Adjustments

 -

 ( 3,794

)

 ( 3,794

)

 Balance as of December 31, 2023

 117,176

 ( 106,434

)

 10,742

 Adjustments

 -

 -

 -

 Balance as of December 31, 2024

 $

 117,176

 $

 ( 106,434

)

 $

 10,742

 When we perform our annual goodwill impairment assessment we have the option to perform a qualitative
 assessment based on a number of factors impacting our reporting units (step 0). When a qualitative assessment is performed, a number of factors are evaluated to determine whether it is more likely than not that the fair value of a reporting unit
 is less than its carrying value. Our qualitative assessment is subjective. It includes a review of macroeconomic and industry factors, review of financial and non-financial performance measures, including projected student starts and assessment of
 adverse events that may negatively impact a reporting unit's carrying value. Adverse events would include, but are not limited to, difficulty in accessing capital, a greater competitive environment, decline in market-dependent multiples or metrics,
 regulatory or political developments, change in key personnel, strategy, or customers, or litigation. If we conclude based on our qualitative review that it is more likely than not that the fair value of the reporting unit is less than the carrying
 value, we proceed with a quantitative impairment test.

 When we perform our quantitative impairment test we believe the most critical assumptions and estimates
 in determining the estimated fair value of our reporting units include, but are not limited to, future tuition revenues, operating costs, working capital changes, capital expenditures and a discount rate. The assumptions used in determining our
 expected future cash flows consider various factors such as historical operating trends particularly in student enrollment and pricing and long-term operating strategies and initiatives.

 If we determine that quantitative tests are necessary, we determine the fair value of each reporting
 unit using an equal weighting of the discounted cash flow model and the market approach, or if required, we will evaluate other asset value-based approaches. Our judgment is necessary in forecasting future cash flows and operating results,
 critical assumptions include growth rates, changes in operating costs, capital expenditures, changes in weighted average costs of capital, and the fair value of an asset based on the price that would be received in a current transaction to sell the
 asset. Additionally, we obtain independent market metrics for the industry and our peers to assist in the development of these key assumptions. This process is consistent with our internal forecasts and operating plans.

 For the years ended
 December 31, 2024, 2023, and 2022, there were impairments relating to goodwill of zero, $ 3.8 million, and zero, respectively.

 On June 8, 2023, the Company consummated the sale of its Nashville, Tennessee property. See Note 8,
 "Real Estate Transactions." The result of the sale created a change in the trajectory of the fair value of the Nashville, Tennessee operations and as such, the Company recorded a pre-tax non-cash impairment charge of $ 3.8 million relating to goodwill. No
 further impairments to goodwill were deemed necessary as of December 31, 2023.

 8.

 REAL ESTATE TRANSACTIONS

 Asset Purchase Agreement – Summerlin, Las Vegas

 On November 11, 2024, the Company, entered into an agreement with DVMD LLS (IntelliTec
 College) for the sale of the Summerlin, Las Vegas ("Euphoria") campus. As a result of the intended sale, the Company recorded the carrying amount of the net assets totaling $ 1.2 million as held for sale on the Consolidated Balance Sheets. The net assets related to the Summerlin, Las Vegas campus consisted of $ 2.1 million in assets and $ 0.9 million in liabilities. The
 sale of the campus was consummated effective January 1, 2025.

 Purchase and Sale-leaseback
 Transaction – Philadelphia, Pennsylvania Area Campus

 On September 28, 2023, the Company purchased a 90,000 square foot property located at 311 Veterans Highway, Levittown, Pennsylvania for approximately $ 10.2 million and subsequently on January 30, 2024 entered into a sale-leaseback transaction for the same property. As of December 31, 2023, this property was classified as held-for-sale on the Consolidated Balance Sheets. During the year ended December 31, 2024, the Company has invested approximately $ 11.7 million in
 capital investments.

 Property Sale Agreement -
 Nashville, Tennessee Campus

 On September 24, 2021, Nashville Acquisition, L.L.C., a subsidiary of the Company, entered into a Contract for the Purchase of Real Estate (the "Nashville Contract") to sell the
 nearly 16 -acre property located at 524 Gallatin Avenue, Nashville, Tennessee 37206, at which the Company operates its Nashville
 campus, to SLC Development, LLC, a subsidiary of Southern Land Company ("SLC").

 On June 8, 2023, the Company closed on the sale of its Nashville, Tennessee property to East Nashville Owner, LLC, an affiliate of SLC, for approximately $ 33.8 million pursuant to the Nashville Contract. The net proceeds from the Nashville sale, net of closing costs, are available for working capital,
 acquisitions, other strategic initiatives, and general corporate purposes. In connection with the sale, the parties entered into a lease agreement allowing Lincoln to continue to occupy the campus and operate it on a rent-free basis for a period
 of 15 months plus options to extend the lease for up to three consecutive 30 -day terms at $ 150,000 per extension term. The carrying value of the campus was approximately $ 4.5 million and the estimated fair value of the rent for the 15 -month
 rent-free period was approximately $ 2.3 million at the consummation of the lease. As of December 31, 2024, the total rent free period has been fully expensed.

 9.

 PROPERTY, EQUIPMENT AND FACILITIES

 Property, equipment and facilities consist of the following:

 At December 31,

 Useful life

 (years)

 2024

 2023

 Land

 -

 $

 $

 Buildings and improvements

 1 - 25

 104,081

 101,540

 Equipment, furniture and fixtures

 1 - 7

 84,352

 80,214

 Vehicles

 1,556

 1,592

 Construction in progress

 -

 54,763

 7,620

 244,804

 191,018

 Less accumulated depreciation and amortization

 ( 141,271

)

 ( 140,161

)

 $

 103,533

 $

 50,857

 The increase in property, equipment and facilities was driven
 by several factors, including a $ 37.0 million investment relating to the build-out of the new Nashville, Tennessee, Levittown,
 Pennsylvania and Houston Texas campuses, $ 10.9 million in new and expanded programs at various campuses, expansions and additional
 programs focused on Welding, Electrical and Electronic Systems Technology ("EEST"), Heating Ventilation and Air Conditioning ("HVAC"), and Auto and Medical Assistant ("MA"), and $ 17.2 million of facilities upgrades including security and branding, with the remainder focusing on training materials and equipment. Depreciation and amortization expense of property,
 equipment and facilities was $ 12.9 million and $ 6.8 million for the years ended December 31, 2024 and 2023, respectively.

 10.

 ACCRUED EXPENSES

 Accrued expenses consist of the following:

 At December 31,

 2024

 2023

 Accrued compensation and benefits

 $

 7,515

 $

 9,845

 Accrued real estate taxes

 1,700

 1,733

 Other accrued expenses

 2,771

 2,102

 $

 11,986

 $

 13,680

 11.

 LONG-TERM DEBT

 Credit Facility

 On February 16, 2024, the Company entered into a secured credit agreement (the "Fifth Third Credit Agreement") with Fifth Third Bank,
 National Association (the "Bank"), pursuant to which the Company, as borrower, has obtained a revolving credit facility in the aggregate principal amount of $ 40.0 million including a $ 10.0 million letter of credit sublimit and a $ 20.0 million accordion feature (the "Facility"), the proceeds of which are to be used for working capital, general corporate and certain other
 permitted purposes. The Facility is guaranteed by the Company's wholly-owned subsidiaries and is secured by a first priority lien in favor of the Bank on substantially all of the personal property owned by the Company and its subsidiaries. The
 term of the Facility is 36 months, maturing on February 16, 2027.

 Each advance under the Facility will bear interest on the outstanding principal amount thereof from the date when made at an interest rate
 determined at the election of the Company at either the Tranche Rate (which is the forward-looking Secured Overnight Financing Rate (SOFR) for one
 or three months), or the Base Rate (which is a variable per annum rate, as of any date of determination, equal to the Bank's Prime
 Rate), plus an Applicable Margin. The Applicable Margin is determined pursuant to a Pricing Grid, which for loans subject to the Tranche Rate varies from 1.75 % to 2.50 % and for loans subject to the Base Rate varies from 0.75 % to 1.50 %. The Applicable Margin
 may change quarterly based on the Total Leverage Ratio at such time. The Total Leverage Ratio is determined with respect to the Company and its subsidiaries on a consolidated basis for an applicable quarterly period by dividing the aggregate
 principal amount of various forms of borrowed indebtedness as of the last day of a determination period by EBITDA (earnings before interest expense, taxes, depreciation and amortization) for such period. Interest is paid in arrears, either quarterly or monthly depending on the Company's interest rate election, with the principal due at maturity.

 Under the terms of the Fifth Third Credit Agreement, the Company will pay to the Bank an unused facility fee on the average daily unused
 balance of the Facility at a rate per annum equal to 0.50 %, which fee is payable in arrears on dates when interest is due and
 payable. As of December 31, 2024, the Company has paid approximately $ 200,000 in unused facility fees. The Company will also pay to
 the Bank a letter of credit fee equal to the Applicable Margin for loans subject to the Tranche Rate multiplied by the maximum amount available to be drawn under such letter of credit.

 The Fifth Third Credit Agreement contains customary representations, warranties and affirmative and negative covenants, as well as events
 of default customary for facilities of this type. In connection with the Fifth Third Credit Agreement, the Company paid fees of approximately $ 456,000
 consisting of bank fees, closing fees, legal costs and other customary fees and reimbursements.

 On July 18, 2024, Company entered into a first amendment (the "Amendment") of the Fifth Third Credit Agreement with the Bank. Among other
 things, the Amendment effects certain modifications to (i) clarify certain representations and affirmative covenants of the Company, (ii) clarify certain conditions to each advance, (iii) clarify and/or replace certain events of default and (iv)
 delete or revise certain definitions in order to harmonize them with the other modifications made. The Amendment also contains customary releases, representations and warranties and reaffirmations consistent with the original terms of the Fifth
 Third Credit Agreement. Except as set forth above, the Amendment does not materially alter the Fifth Third Credit Agreement.

 12.

 STOCKHOLDERS' EQUITY

 Common Stock

 Holders of our Common Stock are entitled to receive dividends when and as declared by our Board of Directors and have the right to one vote per share on all matters requiring shareholder approval. The Company has no t
 declared or paid any cash dividends on our Common Stock since the Company's Board of Directors discontinued our quarterly cash dividend program in February 2015. The Company has no current intentions to resume the payment of cash dividends in the
 foreseeable future.

 Preferred Stock

 On November 30, 2022, the Company exercised in full its right of mandatory conversion of the Company's Series A Preferred Stock. In connection with the conversion, each
 share of Series A Preferred Stock has been cancelled and converted into the right to receive 423.729 shares of the Company's Common
 Stock, no par value per share. Shares of the Series A Preferred Stock are no longer outstanding and all rights of the holders to
 receive future dividends have terminated. As a result of the conversion, the aggregate 12,700 shares of Series A Preferred Stock
 outstanding were converted into 5,381,356 shares of Common Stock.

 Dividends

 Dividends on the Series A Preferred Stock ("Series A Dividends"), at the initial annual rate of 9.6 % is to be paid, in arrears, from the date of issuance quarterly on each December 31, March 31, June 30 and September 30 with September 30, 2020 being the first dividend payment date. For the year ended December 31, 2022, we have paid $ 1.1 million in cash dividends on the outstanding shares of Series A Preferred Stock. With the exercise of the mandatory conversion of the Company's Series A Preferred Stock
 there will not be any additional dividend payment related to the Series A Preferred Stock going forward. Dividends are included in the Consolidated Balance Sheets within additional paid-in-capital when the Company maintains an accumulated deficit.

 Treasury Stock

 On May 24, 2022, the Board of Directors authorized the cancellation of 5,910,541 shares of Treasury Stock, which reduced Treasury Stock and Common Stock by $ 82.9
 million.

 Restricted Stock

 The Company currently has only one active stock
 incentive plan: the Lincoln Educational Services Corporation 2020 Long-Term Incentive Plan (the "LTIP")

 On March 26, 2020, the Board of Directors adopted the LTIP to provide an incentive to certain directors, officers, employees and consultants of the
 Company to align their interests in the Company's success with those of its shareholders through the grant of equity-based awards. On June 16, 2020, the shareholders of the Company approved the LTIP. The LTIP is administered by the Compensation
 Committee of the Board of Directors, or such other qualified committee appointed by the Board of Directors, which will, among other duties, have the full power and authority to take all actions and make all determinations required or provided for
 under the LTIP. Pursuant to the LTIP, the Company may grant options, share appreciation rights, restricted shares, restricted share units, incentive stock options and nonqualified stock options. Under the LTIP, employees may surrender shares as
 payment of applicable income tax withholding on the vested Restricted Stock. The LTIP has a duration of 10 years. On February 23,
 2023, the Board of Directors approved, subject to shareholder approval, the amendment of the LTIP to increase the aggregate number of shares available under the LTIP from 2,000,000 shares to 4,000,000 shares. The amendment was approved and adopted
 by the shareholders at the Annual Meeting of Shareholders held on May 5, 2023.

 F or the years ended December 31, 2024, 2023, and 2022, respectively, the Company completed a net share
 settlement for 330,726, 337,050,
 and 268,654 restricted shares on behalf of certain employees that participate in the LTIP upon the vesting of the restricted shares
 pursuant to the terms of the LTIP. The net share settlement was in connection with income taxes incurred on restricted shares that vested and were transferred to the employees during 2024, 2023, and/or 2022, creating taxable income for the
 employees. At the employees' request, the Company has paid these taxes on behalf of the employees in exchange for the employees returning an equivalent value of restricted shares to the Company. These transactions resulted in a decrease of $ 3.4 million, $ 2.0 million, and $ 2.0 million for each of the years ended December 31, 2024, 2023, and 2022, respectively, to equity on the Consolidated Balance Sheets as the cash
 payment of the taxes effectively was a repurchase of the restricted shares granted in previous years.

 The following is a summary of transactions pertaining to Restricted Stock:

 Shares

 Weighted

 Average Grant

 Date Fair Value

 Per Share

 Nonvested restricted stock outstanding at January 1, 2023

 1,548,266

 5.18

 Granted

 751,240

 6.10

 Cancelled

 ( 37,941

)

 6.15

 Vested

 ( 862,890

)

 3.76

 Nonvested restricted stock outstanding at December 31, 2023

 1,398,675

 5.16

 Granted

 459,181

 9.83

 Cancelled

 ( 24,925

)

 9.03

 Vested

 ( 898,543

)

 6.74

 Nonvested restricted stock outstanding at December 31, 2024

 934,388

 8.02

 The Restricted Stock expense for the fiscal years ended December 31, 2024, 2023, and 2022 was $ 4.6 million, $ 5.9 million, and $ 3.1 million, respectively. The unrecognized Restricted Stock expense as of December 31, 2024, 2023, and 2022 was $ 4.3 million, $ 4.3 million, and $ 7.9 million, respectively. As of December 31, 2024, outstanding Restricted Shares under the LTIP had an aggregate intrinsic value of $ 14.8 million.

 Share Repurchase Program

 On May 24, 2022, the Company announced that its Board of Directors had authorized a share repurchase program of up to $ 30.0 million of the Company's outstanding Common Stock. The repurchase program was authorized for 12
 months. Pursuant to the program, purchases may be made, from time to time, in open-market transactions at prevailing market prices, in privately negotiated transactions or by other means as determined by the Company's management and in
 accordance with applicable federal securities laws. The timing of purchases and the number of shares repurchased under the program will depend on a variety of factors including price, trading volume, corporate and regulatory requirements and
 market conditions. The Company retains the right to limit, terminate or extend the share repurchase program at any time without prior notice.

 On February 27, 2023, the Board of Directors extended the share repurchase program for an additional 12 months and
 authorized the repurchase of an additional $ 10.0 million of the Company's Common Stock, for an aggregate of up to $ 30.6 million in additional repurchases.

 On May 7, 2024, the
 Company announced that its Board of Directors had authorized an extension of the share repurchase program for an additional 12 months
 through May 24, 2025. During the years ended December 31, 2024, 2023, and 2022, the Company repurchased zero shares, 165,064 shares, and 1,572,414
 shares, respectively. As of December 31, 2024, the Company had approximately $ 29.7 million remaining for additional repurchases
 under the program. Since inception of the program, the Company has made repurchases of approximately 1.7 million shares of the
 Company's Common Stock at an average share price of $ 5.95 for an aggregate expenditure of approximately $ 10.3 million

 The following table presents information about our repurchases of Common
 Stock, all of which were completed through open market purchases:

 Year Ended

 (in thousands, except share data)

 2024

 2023

 2022

 Total number of shares repurchased 1

 -

 165,064

 1,572,414

 Total cost of shares repurchased

 $

 -

 $

 $

 9,445

 1 These shares were subsequently canceled and recorded as a reduction of Common Stock.

 S-3 Registration

 On December 24, 2024,
 the Company filed a Form S-3 with the Securities and Exchange Commission ("SEC") using a "shelf" registration process. Under this shelf registration process, we may sell the securities described in this prospectus in one or more offerings up to a
 total dollar amount of $ 150.0 million.

 13.

 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 Company has terminated its defined benefit pension plan as of December 31, 2024. In connection with this termination, the Company is expecting to offer plan
 participants a choice between a lump sum payment and the continuation of their benefits through an annuity contract with a third-party insurance provider. The termination is not expected to have a material impact on the Company's financial
 condition or results of operations in 2024, but the final settlement accounting will be recorded during the year ended December 31, 2025.

 The following table sets forth the plan's funded status and amounts recognized in the Consolidated Financial Statements:

 2024

 2023

 CHANGES IN BENEFIT OBLIGATIONS:

 Benefit obligation-beginning of year

 $

 16,621

 $

 17,113

 Interest cost

 Actuarial (gain) loss

 ( 550

)

 Benefits paid

 ( 1,264

)

 ( 1,288

)

 Benefit obligation at end of year

 15,565

 16,621

 CHANGE IN PLAN ASSETS:

 Fair value of plan assets-beginning of year

 17,380

 16,445

 Actual return on plan assets

 1,010

 2,223

 Benefits paid

 ( 1,271

)

 ( 1,288

)

 Fair value of plan assets-end of year

 17,119

 17,380

 FAIR VALUE IN EXCESS OF BENEFIT OBLIGATION FUNDED STATUS:

 $

 1,554

 $

 For the fiscal year ended December 31, 2024, the actuarial loss of zero
 was due to the decrease in the discount rate from 4.90 % to 4.71 %.

 Amounts recognized in the Consolidated Balance Sheets consist of:

 At December 31,

 2024

 2023

 Noncurrent assets

 $

 1,554

 $

 Amounts recognized in accumulated other comprehensive income (loss) consist of:

 2024

 2023

 2022

 Accumulated loss

 $

 ( 793

)

 $

 ( 1,219

)

 $

 ( 2,480

)

 Deferred income taxes

 1,067

 1,183

 1,520

 Accumulated other comprehensive income (loss)

 $

 $

 ( 36

)

 $

 ( 960

)

 The accumulated benefit obligation was $ 15.5 million and
 $ 16.6 million at December 31, 2024 and 2023, respectively.

 The following table provides the components of net periodic cost for the plan:

 2024

 2023

 2022

 COMPONENTS OF NET PERIODIC BENEFIT COST

 Service cost

 $

 -

 $

 -

 $

 Interest cost

 Expected return on plan assets

 ( 1,127

)

 ( 1,065

)

 ( 1,217

)

 Recognized net actuarial loss

 -

 Net periodic benefit income

 $

 ( 369

)

 $

 ( 167

)

 $

 ( 557

)

 The estimated net income and prior service cost for the plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the
 next year is zero.

 The following tables present plan assets using the fair value hierarchy as of December 31, 2024 and 2023, respectively. 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.

 Quoted Prices in

 Active Markets

 for Identical

 Assets

 Significant Other

 Observable Inputs

 Unobservable

 (Level 1)

 (Level 2)

 (Level 3)

 Total

 Equity securities

 $

 -

 $

 -

 $

 -

 $

 -

 Fixed income

 16,050

 -

 -

 16,050

 International equities

 -

 -

 -

 -

 Real estate

 -

 -

 -

 -

 Cash and equivalents

 1,069

 -

 -

 1,069

 Balance at December 31, 2024

 $

 17,119

 $

 -

 $

 -

 $

 17,119

 Quoted Prices in

 Active Markets

 for Identical

 Assets

 Significant Other

 Observable Inputs

 Unobservable

 (Level 1)

 (Level 2)

 (Level 3)

 Total

 Equity securities

 $

 4,231

 $

 -

 $

 -

 $

 4,231

 Fixed income

 8,065

 -

 -

 8,065

 International equities

 3,466

 -

 -

 3,466

 Real estate

 1,062

 -

 -

 1,062

 Cash and equivalents

 -

 -

 Balance at December 31, 2023

 $

 17,380

 $

 -

 $

 -

 $

 17,380

 Fair value of total plan assets by major asset category as of December 31:

 2024

 2023

 Equity securities

 0 %

 25 %

 Fixed income

 94 %

 47 %

 International equities

 0 %

 20 %

 Real estate

 0 %

 6 %

 Cash and equivalents

 6 %

 2 %

 Total

 100 %

 100 %

 Weighted-average assumptions used to determine benefit obligations as of December 31:

 2024

 2023

 2022

 Discount rate

 5.30 %

 4.71 %

 4.90 %

 Rate of compensation increase

 Weighted-average assumptions used to determine net periodic pension cost for years ended December 31:

 2024

 2023

 2022

 Discount rate

 4.71 %

 4.71 %

 4.90 %

 Rate of compensation increase

 Long-term rate of return

 6.75 %

 6.75 %

 6.75 %

 The Company has terminated its pension plan and has revised its strategy to adjust the allocation to a full liability investment strategy. The plan currently allocates
 all funds to fully fixed income investment and cash allocation, attempting to eliminate funding level fluctuations during the termination process.

 The Company does not expect to make contributions to the plan in 2025.

 The total amount of the Company's contributions paid under its pension plan was zero for each of the fiscal years ended December 31, 2024 and 2023, and 2022, respectively.

 Information about the expected benefit payments for the plan is as follows:

 Year Ending December 31,

 2025

 $

 4,087

 2026

 1,242

 2027

 1,210

 2028

 1,173

 2029

 1,135

 Years 2030-2034

 5,048

 The Company has a 401(k) defined contribution plan for all eligible employees. Employees may contribute up to 75 % of their compensation into the plan. The Company may contribute up to an additional 15 % of the employee's contributed amount up to 6 % of compensation. For each of the fiscal years ended
 December 31, 2024, 2023, and 2022, the Company's expense for the 401(k) plan amounted to $ 0.8 million, $ 0.8 million, and $ 0.7 million,
 respectively.

 14.

 INCOME TAXES

 Components of the provision for income taxes were as follows:

 2024

 2023

 2022

 Current:

 Federal

 $

 4,496

 $

 5,825

 $

 1,864

 State

 2,566

 2,185

 Total

 7,062

 8,010

 2,508

 Deferred:

 Federal

 ( 1,555

)

 State

 ( 687

)

 Total

 ( 2,242

)

 1,632

 1,294

 Total provision

 $

 4,820

 $

 9,642

 $

 3,802

 Effective Tax rate

 The reconciliation of the effective tax rate to the U.S. Statutory Federal Income tax rate was:

 2024

 2023

 2022

 Income before taxes

 $

 14,711

 $

 35,639

 $

 16,436

 Expected tax

 $

 3,089

 21.0 %

 $

 7,484

 21.0 %

 $

 3,452

 21.0 %

 State tax (net of federal benefit)

 1,483

 10.1 %

 2,234

 6.3 %

 5.6 %

 Other

 1.7 %

 ( 76

)

 - 0.2 %

 ( 575

)

 - 3.5 %

 Total

 $

 4,820

 32.8 %

 $

 9,642

 27.1 %

 $

 3,802

 23.1 %

 Deferred Taxes

 The components of the non-current deferred tax assets (liabilities) were as follows:

 At December 31,

 2024

 2023

 Gross noncurrent deferred tax assets (liabilities)

 Operating lease liability

 $

 40,209

 $

 26,835

 Provision for credit losses

 17,558

 14,388

 Finance lease liability

 7,835

 4,390

 Depreciation and amortization

 3,142

 4,180

 Stock-based compensation

 1,223

 Net operating loss carryforwards

 1,040

 Accrued expenses

 Other intangibles

 Pension plan liabilities

 ( 416

)

 ( 202

)

 Goodwill

 ( 603

)

 ( 618

)

 Finance lease right of use assets

 ( 7,161

)

 ( 4,224

)

 Operating lease right-of-use assets

 ( 36,904

)

 ( 24,043

)

 Noncurrent deferred tax assets, net

 $

 25,359

 $

 23,218

 As of December 31, 2024, and 2023, the Company had gross
 net operating losses ("NOL") of $ 14.0 million and $ 18.1 million, respectively, for state tax purposes and none for federal. While some states NOL can be carried forward indefinitely, the majority of state NOLs expire in 2033 and end in 2037
 if not utilized.

 15.

 FAIR VALUE

 The accounting framework for determining fair value includes a hierarchy for ranking the quality and reliability of the information used to measure fair value,
 which enables the reader of the financial statements to assess the inputs used to develop those measurements. The fair value hierarchy consists of three tiers:

 Level 1: Defined as quoted market prices in active markets for identical assets or liabilities.

 Level 2: Defined as inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities,
 quoted prices in markets that are not active, model-based valuation techniques for which all significant assumptions are observable in the market or other inputs that are observable or can be corroborated by observable market data for
 substantially the full term of the assets or liabilities.

 Level 3: Defined as unobservable inputs that are not corroborated by market data.

 The following table presents the fair value of the financial instruments measured on a recurring basis as of December 31, 2024 and
 2023.

 December 31, 2024

 Carrying

 Quoted Prices

 in Active

 Markets for

 Identical

 Assets

 Other

 Observable

 Unobservable

 Amount

 (Level 1)

 (Level 2)

 (Level 3)

 Total

 C ash equivalents:

 Money market fund

 $

 $

 $

 -

 $

 -

 $

 Total cash equivalents and short-term investments

 $

 $

 $

 -

 $

 -

 $

 December 31, 2023

 Carrying

 Quoted Prices

 in Active

 Markets for

 Identical

 Assets

 Other

 Observable

 Unobservable

 Amount

 (Level 1)

 (Level 2)

 (Level 3)

 Total

 C ash equivalents:

 Money market fund

 $

 9,037

 $

 9,037

 $

 -

 $

 -

 $

 9,037

 Treasury bill

 20,343

 20,343

 -

 -

 20,343

 Total cash equivalents and short-term investments

 $

 29,380

 $

 29,380

 $

 -

 $

 -

 $

 29,380

 The Company measures the fair value of money market funds and treasury bills using Level 1 inputs. Pricing sources may include industry standard data providers,
 security master files from large financial institutions and other third-party sources used to determine a daily market value.

 The carrying amount of the Company's financial instruments, including cash equivalents, short-term investments, 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.

 16.

 SEGMENT REPORTING

 The Company's manages its business, evaluates performance and allocates resources based on two reportable business segments, Campus Operations and Transitional.

 Campus Operations – The Campus Operations segment includes campuses that are continuing in operation and
 contribute to the Company's core operations and performance. All of the campuses continuing in operation are classified in this segment. The majority of the campuses offer programs across various areas of study.

 Transitional – The Transitional segment refers to campuses that are marked for closure and are
 currently being taught-out, in addition to campuses that are held-for-sale or sold. As of December 31, 2024, the net assets for the Summerlin, Las Vegas campus were classified as held for sale, with operating results classified within the
 Transitional segment. The sale of the campus was consummated effective January 1, 2025. In addition, the Company closed the Somerville, Massachusetts campus in the prior year. It was fully taught-out as of December 31, 2023. This campus was
 classified in the Transitional segment in the prior year's statement of operations.

 The individual operating segments have been aggregated into the two
 main reportable segments based on the method by which our Chief Operating Decision Maker ("CODM") 1) evaluates performance and allocates resources and 2) as a result of the Company's judgment, that the reporting units have similar products,
 production processes, types of customers, methods of distribution, regulatory environment and economic characteristics. The Company's CODM is comprised of a team of executives deemed the "Executive Committee" which is made up of the following
 individuals:

 1.

 Scott Shaw – Chief Executive Officer and Director

 2.

 Brian Meyers – Executive Vice President, Chief Financial Officer, and Treasurer

 The CODM assesses segment financial performance by reviewing segment revenue and segment operating income, which includes certain Corporate overhead
 allocations relating directly to the segments disclosed. Some of the allocated costs include the centralization of the Company's financial aid process, national sales and receivables and default costs. The CODM will make decisions to allocate
 resources based on the review of monthly, quarterly and annual financial information categorized by segment. The financial information is presented to the CODM using actual-to-actual results and budget-to-actual results.

 Consolidated

 Corporate

 2024

 2023

 2022

 2024

 2023

 2022

 2024

 2023

 2022

 2024

 2023

 2022

 REVENUE

 $

 440,064

 $

 $

 348,287

 $

 432,966

 $

 367,233

 $

 330,896

 $

 7,098

 $

 10,837

 $

 17,391

 $

 -

 $

 -

 $

 -

 COSTS AND EXPENSES:

 Instructional

 90,566

 85,311

 79,021

 88,207

 82,228

 75,274

 2,359

 3,083

 3,747

 -

 -

 -

 Books and Tools

 32,146

 26,177

 23,623

 31,161

 24,802

 21,642

 1,375

 1,981

 -

 -

 -

 Facilities

 46,791

 44,647

 40,327

 45,842

 42,475

 38,071

 2,172

 2,256

 -

 -

 -

 Depreciation

 12,256

 6,140

 5,775

 12,200

 6,030

 5,669

 -

 -

 -

 Educational services and facilities

 181,759

 162,275

 148,746

 177,410

 155,535

 140,656

 4,349

 6,740

 8,090

 -

 -

 -

 Sales and marketing

 75,236

 65,553

 61,241

 73,532

 64,159

 58,561

 1,704

 1,394

 2,680

 -

 -

 -

 Student services

 21,874

 18,693

 16,077

 21,012

 17,314

 15,004

 1,379

 1,073

 -

 -

 -

 Bad debt

 56,578

 41,637

 34,915

 55,600

 39,978

 32,731

 1,659

 2,187

 -

 ( 3

)

 Administrative

 89,415

 82,622

 69,571

 41,235

 37,976

 35,068

 1,236

 2,030

 2,066

 46,944

 42,616

 32,437

 Depreciation

 -

 -

 -

 -

 -

 -

 243,803

 209,135

 182,391

 191,379

 159,427

 141,364

 4,777

 6,462

 8,006

 47,647

 43,246

 33,021

 Loss (gain) on sale of assets

 2,119

 ( 30,918

)

 ( 177

)

 -

 1,489

 ( 30,939

)

 ( 205

)

 Gain on insurance proceeds

 ( 2,794

)

 -

 -

 -

 -

 -

 -

 -

 -

 ( 2,794

)

 -

 -

 Impairment of goodwill and long-lived assets

 -

 4,220

 1,049

 -

 4,220

 1,049

 -

 -

 -

 -

 -

 -

 Total costs and expenses

 424,887

 344,712

 332,009

 369,408

 319,202

 283,097

 9,137

 13,203

 16,096

 46,342

 12,307

 32,816

 OPERATING INCOME (LOSS)

 $

 15,177

 $

 33,358

 $

 16,278

 $

 63,558

 $

 48,031

 $

 47,799

 $

 ( 2,039

)

 $

 ( 2,366

)

 $

 1,295

 $

 ( 46,342

)

 $

 ( 12,307

)

 $

 ( 32,816

)

 17.

 COMMITMENTS AND CONTINGENCIES

 Litigation and Regulatory Matters— O n June 22, 2022, the DOE and the
 plaintiff student loan borrowers in a class action against the DOE initiated on June 25, 2019 in the U.S. District Court for the Northern District of California (Sweet v. Cardona, No. 3:19-cv-3674 (N.D. Cal.)) announced a proposed settlement
 agreement to resolve claims that the DOE had failed to timely decide Borrower Defense to Repayment applications submitted to the DOE. The proposed settlement included three categories
 of relief for student loan borrowers. First, the DOE would agree to discharge loans and refund prior loan payments to class members with loan debt associated with an institution on the list included in the settlement (which includes Lincoln
 institutions). The class action plaintiffs and the DOE stated that the DOE had determined that attendance at one of the listed institutions justifies presumptive relief allegedly based on strong indicia regarding substantial misconduct by the
 institutions, whether credibly alleged or in some instances proven, and the purportedly high rate of class members with applications related to the listed schools. Second, the proposed settlement included new procedures for the DOE to resolve
 pending borrower defense claims associated with other schools not on the list. Third, for any student loan borrower who submitted a borrower defense application after June 22, 2022 and before the final approval of the settlement, the proposed
 settlement would require the DOE to review the applications under the DOE's 2016 regulatory standards and issue decisions within 36
 months, or else the applications would be discharged in full.

 On November 16, 2022, the federal district court approved the
 settlement as proposed and the DOE began implementing the settlement relief while Lincoln and other parties appealed the settlement's final approval to the U.S. Court of Appeals for the Ninth Circuit. On November 5, 2024, the Ninth Circuit
 upheld the settlement on appeal. One or more parties are expected to continue to appeal the final approval of the settlement, but Lincoln does not intend to continue participating in the appeal. As a result of this final approval, the DOE
 has estimated that approximately 196,000 student loan borrowers who attended one of the listed schools (including Lincoln
 institutions) will receive automatic student loan discharges; that another approximately 100,000 student loan borrowers who
 attended other schools not on the list would receive decisions under new procedures; and that approximately 250,000 student loan
 borrowers who submitted borrower defense applications between June 22, 2022 and November 16, 2022 would receive decisions under the DOE's 2016 regulatory standards within 36 months or else receive automatic student loan discharges.

 It is not possible at this time to predict whether the settlement will
 continue to be upheld on appeal, what additional actions the DOE might take as the settlement continues to be upheld on appeal, or whether the DOE or other agencies might take actions against Lincoln institutions. Such actions could have a
 material adverse effect on our business and results of operations. We believe the DOE already may have discharged some or all of the pending applications.

 In addition to the
 foregoing, in the ordinary conduct of our business, we are subject to additional periodic lawsuits, investigations, regulatory proceedings and other claims, including, but not limited to, claims involving students or graduates, routine
 employment matters and business disputes. We cannot predict the ultimate resolution of these lawsuits, investigations, regulatory proceedings and other claims asserted against us, but we do not believe that any of these matters will have a
 material adverse effect on our business, financial condition, results of operations or cash flows.

 Student Financing Plans— At December 31, 2024, the Company had outstanding net financing commitments to its students to assist them in financing their education of
 approximately $ 44.6 million, net of interest.

 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 $ 9.6 million at December 31, 2024.

 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, 2024, the Company has posted surety bonds in the total amount of approximately $ 17.0
 million.

 LINCOLN EDUCATIONAL SERVICES CORPORATION

 Schedule II—Valuation and Qualifying Accounts

 (in thousands)

 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, 2024

 Student receivable allowance

 $

 $

 56,578

 $

 ( 44,817

)

 $

 65,572

 December 31, 2023

 Student receivable allowance

 $

 35,370

 $

 41,637

 $

 ( 23,196

) 1

 $

 December 31, 2022

 Student receivable allowance

 $

 31,921

 $

 34,915

 $

 ( 31,466

)

 $

 35,370

 On January 1, 2023, the Company adopted Accounting Standards Update No. 2016-13 Financial Instruments - Credit Losses. The adoption resulted in an opening balance sheet adjustments of $ 10.8 million increasing the allowance for credit losses relating to the Company's outstanding receivables. The adoption also resulted in a decrease to retained earnings
 of $ 7.9 million, after tax and a deferred tax asset increase of $ 2.9 million.