Lincoln Educational Services Corp 8-K, filed May 6, 2022
Lincoln Educational Services Corp (LINC)
8-K
2022-05-06
For: 2022-05-05
View Original
Added on
April 11, 2026
About this 8-K
Lincoln Educational Services Corp filed this 8-K on May 6, 2022, reporting on events of May 5, 2022.
Items reported
- Item 5.07: Shareholder vote results
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): May 5, 2022
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(State or Other Jurisdiction of Incorporation)
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Registrant’s telephone number, including area code: (
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following
provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2
of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised
financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading
Symbol(s)
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Name of each exchange on which registered
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| Item 5.07 |
Submission of Matters to a Vote of Security Holders.
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On May 5, 2022, Lincoln Educational Services Corporation (the “Company”) held its 2022 Annual Meeting of Shareholders (the “Annual Meeting”)
virtually via live webcast. A total of 27,449,203 shares of common stock $0.01 par value per share (the “Common Stock”) each of which is entitled to one vote, and a total of 12,700 shares of the Company’s Series A Convertible Preferred Stock, no
par value per share (the “Series A Preferred Stock”) each of which is entitled to 423.729 votes per share representing the number of shares of Common Stock into which each share of Series A Preferred Stock is convertible, were issued and
outstanding and entitled to vote as of March 8, 2022 the record date for the Annual Meeting. There were 22,608,441 shares of Common Stock and 12,700 shares of Series A Preferred Stock represented in person or by proxy at the Annual Meeting
constituting a quorum. With respect to Proposal 1, holders of Common Stock and Series A Preferred Stock voted together as a single class, with the holders of Series A Preferred Stock voting on an as-converted basis, on the election of James J.
Burke, Jr., Kevin M. Carney, Ronald E. Harbour, J. Barry Morrow, Michael A. Plater, Felecia J. Pryor, Carlton E. Rose and Scott M. Shaw (eight of the nine director nominees), while the holders of Series A Preferred Stock, voting separately as a
class, voted on the election of John A. Bartholdson. Proposals 2 and 3 were voted on by the holders of Common Stock and Series A Preferred Stock voting together as a single class with the holders of Series A Preferred Stock voting on an
as-converted basis. Each of the proposals was approved by the requisite vote of the Company’s shareholders. Set forth below are the proposals acted upon as further described in the Company’s definitive proxy statement on Schedule 14A filed with
the Securities and Exchange Commission on March 25, 2022 and the final voting results for each proposal:
Proposal Number 1: To elect the following 9 individuals named in the Company’s proxy statement as directors of the Company for a one-year term which will expire at the 2023 Annual Meeting of Shareholders and until their
successors are duly elected and qualified. Each nominee for director was elected by a vote of the shareholders as follows:
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Nominee
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Votes For
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Votes Withheld
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Broker
Non-Votes
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John A. Bartholdson*
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5,381,358
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-0-
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-0-
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James J. Burke, Jr.
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22,106,051
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2,363,324
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3,520,464
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Kevin M. Carney
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24,368,599
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100,776
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3,520,464
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Ronald E. Harbour
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22,066,380
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2,402,995
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3,520,464
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J. Barry Morrow
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24,442,567
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26,808
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3,520,464
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Michael A. Plater
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22,174,074
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2,295,301
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3,520,464
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Felecia J. Pryor
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24,227,312
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242,063
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3,520,464
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Carlton E. Rose
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24,333,080
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136,295
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3,520,464
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Scott M. Shaw
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24,441,527
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27,848
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3,520,464
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*The holders of Series A Preferred Stock, voting separately as a class, voted on the election of John A. Bartholdson.
Proposal Number 2: To approve, on a non-binding advisory basis, the compensation of our named executive officers as disclosed in the Company’s proxy statement. The proposal was approved by a vote of the shareholders as
follows:
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Votes For
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Votes Against
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Abstentions
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Broker
Non-Votes
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24,081,691
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378,881
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8,763
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3,520,464
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Proposal Number 3: To ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2022. The proposal was approved by a vote of the
shareholders as follows:
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Votes For
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Votes Against
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Abstentions
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Broker
Non-Votes
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27,896,087
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83,954
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9,758
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not applicable
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| Item 7.01 |
Regulation FD Disclosure.
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On May 5, 2022, the Company presented additional background information on the Company and on its strategic plan (the “Shareholder Presentation”)
during its Annual Meeting of Shareholders held virtually. A copy of the Shareholder Presentation, which is available on the Company’s website at www.lincolntech.edu under the tab “Investor Relations,” is attached hereto as Exhibit 99.1, and is
incorporated herein by reference. The information in this Item 7.01 and the attached exhibit shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall they be deemed
incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act except as shall be expressly stated by specific reference in such filing
| Item 9.01 |
Financial Statements and Exhibits.
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(d) Exhibits.
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Exhibit No.
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Exhibit Title
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Management Presentation at the 2022 Annual Meeting of Shareholders
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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LINCOLN EDUCATIONAL SERVICES CORPORATION
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Date: May 5, 2022
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By:
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/s/ Alexandra M. Luster
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Name:
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Alexandra M. Luster
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Title:
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SVP, General Counsel & Secretary
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Exhibit 99.1
PUT YOUR POTENTIAL TO WORK 2022 Shareholders Meeting
Stronger and BetterLincoln entered 2021 with great momentum and success, and despite the continuing
challenges of the pandemic, we ended the year stronger financially and better prepared to reach our potential. 2
3
Silver Tsunami – aging baby-boomers retiring from the workplace Growing skepticism of the value of
college Employers struggle to find interested candidates Simple jobs have become more complex with technology Strong demand in healthcare, manufacturing and construction Infrastructure spending will exacerbate the shortage Less stigma –
Essential Workers Demand Supply Societal pressure to go to college Elimination of Vo-Tec programs 4 GAP Drivers of Organic Demand for Training
Demand for “Middle Skills Training” 5 Middle-skill jobs, which require education beyond high school but
not a four-year degree, make up the largest part of America’s labor market. (Source: National Skills Coalition) Lincoln connects employers with entry level trained professionals from the adult, high school and military sectors.
Leadership changes Positive new student starts Enrollment growth Return to profitability Financing
transactions 2021 : A New Chapter for Lincoln 2015 – 2017 Restructuring 2018 – 2020 Turnaround 2021 & beyond Growth Pressures throughout industry Programs realigned Campuses closed Cost cutting . Achieve organic
growth Resources to accelerate growth Increase marketing Expand and add programs Add campuses 6
Transformational Impact of COVID-19 7 All campuses were closed mid March 2020 & moved to remote
services Campuses started to re-open in June 2020 with all open by August All campus support services offered at the campus and remotely Lincoln finished 2020 financially stronger than 2019 Pivoted to Online/Blended Revenue grew by 7.2% to
$293.0 million and starts increased 10.7% EBITDA grew by 66.1% to $22.2 million Cash increased and debt declined to end the year net cash + Started 2021 with 1,034 more students Strong 2020 Results Met or exceeded 2021 guidance Cash and
cash equivalents as of 12/31/2021: ~$80M No debt outstanding as of 12/31/2021; $11M available under revolving line of credit Monetized real estate through a sale-leaseback transaction 2021 Operations All programs will be blended 25% online
/ 75% on campus. Lincoln’s existing operations will be simplified and streamlined Additional services will improve graduation and placement rates Operating efficiencies should lead to increased profitability 2022 and Beyond
Our Superior Educational Approach 8 Feedback Integration Student Support Industrial
Infrastructure Engaging Curriculum Graduation and Placement Employment Assistance Develop training programs with feedback from employers and key industry associations to understand gaps and needs Integrate industry preferred licensing and
certifications into the curriculum Provide robust student support services to ensure strong outcomes Build labs and shops that replicate the working environment using professional grade equipment and tools Incorporate cutting edge education
technology with animations, videos and simulations to make learning active and engaging Superior graduation rates and placement rates Expect students to meet employability standards for appearance, attendance and professional attitude while
in school Offer an accelerated program with multiple entry points to allow students to graduate quickly and enter the workforce earlier
Growing Base of Industry Partners 9 Positions Lincoln as long-term solutions provider for both entry
level technicians and advanced workforce training Employers appreciate the technical and soft skills of our students Partners provide validation of the quality of our education Co-branding opportunities with elite partners helps attract new
students Partners provide better job opportunities for our graduates
Compliance Stats 10 90/10 Rule : This rule caps the percentage of revenue that a proprietary
institution can receive from federal financial aid sources at 90%; the other 10% of revenue must come from alternative sources. CDR : It is the percentage of a school's borrowers who enter repayment on certain Federal Family Education Loan
(FFEL) Program or William D. Ford Federal Direct Loan (Direct Loan) Program loans during a particular federal fiscal year (FY), October 1st to September 30th, and default or meet other specified conditions prior to the end of the second
following fiscal year. Composite Score : the DOE composite score reflects the overall financial health of an institution. The score can be anywhere along the scale from negative 1.0 to positive 3.0. If an institution receives a score greater
than or equal to 1.5, the institution is considered financially responsible. FY 2021 FY 2020 Metrics Company Overall New Britain OPEID Indianapolis OPEID Iselin OPEID Company Overall New Britain OPEID Indianapolis OPEID Iselin
OPEID 90/10 75% 77% 72% 80% 77% 79% 74% 83% 90/10* 82% 82% 82% 83% 85% 85% 84% 85% CDR** 9.8% 10.3% 11.3% 6.6% 10.1% 10.8% 11.0% 8.0% Composite Score 3.0 2.6 This data is the annual
data submitted to ACCSC for completion and employment rates for programs offered as of July 1, 2021 Total Students Available for Grad. Total Grads Completion Percentage Grads. Available for Employment Total Employed Employment
Percentage 12,602 8,292 66% 8,009 6,401 80% * Currently veteran’s educational benefits is not included as part of the 90% limit, however, if it was included, the Company’s ratio would remain below 90% as shown in the adjusted
ratio. ** 2018 cohort reported in FY21, 2017 cohort reported in FY20.
Experienced Management Team (Years at Lincoln) 11 Chad Nyce EVP, Chief Innovation Officer (2)
Board of Directors J. Barry Morrow Non-Executive Chairman, Lincoln Educational Services; Founder &
Chief Executive Officer, BK Capital Group James J. Burke, Jr. Founder & Managing Partner, JJB Capital Partners LLC Kevin M. Carney Former Executive Vice President & Chief Financial Officer, Web.com Group Inc. Ronald E.
Harbour Senior Advisor, Global Automotive Manufacturing Practice, Oliver Wyman Co. Carlton Rose President, Global Fleet Maintenance & Engineering, UPS; 1981 Lincoln Tech Graduate Dr. Michael A. Plater Former University President,
Strayer University Scott M. Shaw President & Chief Executive Officer, Lincoln Educational Services John A. Bartholdson Co-Founder & Partner, Juniper Investment Co. LLC Felecia Pryor Chief Human Resources Officer, BorgWarner 12
Financial Review
Profitability 2018 – 2021(Continuing Operations) 14 Refer to appendix for adjusted EBITDA
Reconciliation
15 Total Operations ($ in millions) Approximately 13,100 students enrolled at 22 campuses as of
12/31/2021 Key metrics such as revenue and average population continue to grow Approximately 2,700 student starts for the quarter ending 12/31/2021 Average population grew approximately 650 vs. PY for the three months ending 12/31/2021 Q4
Revenue & Margin Q4 Adj. EBITDA YTD Dec Revenue & Margin YTD Dec Adj. EBITDA Refer to appendix for adjusted EBITDA Reconciliation
16 Transportation and Skilled Trades ($ in millions) Approximately 10,300 starts for the twelve months
ending 12/31/2021 Average Population increased by approximately 650 students YTD December 2021 Approximately 8,650 students enrolled at 13 campuses as of 12/31/2021 Average Population increased by approximately 550 students for the three
months ending 12/31/2021 YTD Dec Revenue & Margin Q4 Revenue & Margin YTD Adj. EBITDA Q4 Adj. EBITDA Refer to appendix for adjusted EBITDA Reconciliation
17 YTD Dec Revenue & Margin Healthcare and Other Professions ($ in millions) Approximately 5,100
starts for the Twelve months ending 12/31/2021 Average population increased by approximately 200 students as of 12/31/2021 Approximately 4,500 students enrolled at 9 campuses for the three months ending 12/31/2021 Average Population
increased by approximately 100 students for the three months ending 12/31/2021 Q4 Revenue & Margin YTD Dec Adj. EBITDA Q4 Adj. EBITDA Refer to appendix for adjusted EBITDA Reconciliation
Balance Sheet & Cash Flow Summaries
