Item 2.01 |
Completion of Acquisition or Disposition of Assets.
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On June 8, 2023, Nashville Acquisition, LLC, a subsidiary of Lincoln Educational Services Corporation (the “Company”), consummated the previously
reported contemplated sale of approximately 16 acres of property located at 1524 Gallatin Road, Nashville, Tennessee (the “Nashville Sale”), at which the Company operates its Nashville campus, to East Nashville Owner, LLC, an affiliate of SLC
Development, LLC, a subsidiary of Southern Land Company (“SLC”), pursuant to the Contract for the Purchase of Real Estate, dated September 21, 2021, as amended (the “Sale Agreement”), for a purchase price of approximately $33.8 million.
Pursuant to the terms of the Sale Agreement, the Company has negotiated a lease agreement with SLC allowing it to continue to occupy the property
and operate the Nashville campus for a period of 15 months, rent-free, and including, thereafter, three options to extend the lease beyond the initial 15-month term for consecutive 30-day terms at $150,000 per extension term. As previously
reported, the Company intends ultimately to relocate its Nashville campus to a newer, state-of-the-art property in the Nashville metropolitan area but has not yet determined a location.
The net proceeds are approximately $33.2 million, net of closing costs, from the Nashville Sale which will be available for working capital,
acquisitions, other strategic initiatives and general corporate purposes. The property’s carrying value is approximately $4.5 million. The estimated fair value of the rent for the 15-month rent-free period is between $2.0 million and $2.5 million.
Forward-Looking Statements
This Current Report on Form 8-K, including Exhibit 99.1 hereto, includes certain “forward-looking statements” within the meaning of Section 27A of
the Securities Act, and Section 21E of the Exchange Act, which are intended to qualify for the “safe harbor” from liability established by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact
are forward-looking statements. Additionally, forward looking statements are subject to certain risks, trends, and uncertainties. The Company cannot provide assurances that the assumptions upon which these forward-looking statements are based will
prove to have been correct. Should one of these risks materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expressed or implied in any forward-looking statements, and investors are cautioned
not to place undue reliance on these forward-looking statements, which are current only as of the date of this Current Report on Form 8-K. The Company does not intend to update or revise any forward-looking statements made herein or any other
forward-looking statements as a result of new information, future events or otherwise. The Company further expressly disclaims any written or oral statements made by a third party regarding the subject matter of this Current Report on Form 8-K.