Don't care if you believe me or not. Ask a CSC director and above because Jack said it was okay to share per the last sentence. Have a good weekend.
From: Massimino, Jack
Sent: Thursday, September 25, 2014 5:53 PM
Subject: Company Update
Date: September 25, 2014
To: Campus Presidents and Above, CSC Directors and Above
From: Jack Massimino, Chairman and Chief Executive Officer
RE: Company Update
Last Friday we filed an 8K with the Securities and Exchange Commission, and have since received feedback that many employees need clarification about the various issues described in the document.
The bottom line is this – nothing in the 8K signals a change in our current plan. We are moving ahead with the sale of our Heald, Everest, and WyoTech campuses in the U.S. We are working diligently toward definitive agreements with buyers and continue to expect to complete these transactions in November.
In general, the 8K addresses four main areas:
1) A second amendment to our Operating Agreement with the Department of Education (ED). The amendment describes the process for funding the $30 million escrow account for student refunds and notes that ED gave our credit facility lenders (banks) until September 25 (today) to approve the amendment. The banks have now done so.
2) Two new U.S. Attorney subpoena requests for documents. We are cooperating with both of these requests.
3) A system-wide “Warning” notice from ACCSC, one of our main institutional accreditors. ACCSC has placed 40 campuses on “Warning” (previously “show cause”), for reasons primarily related to placement verification.
4) The lawsuit filed by the Consumer Financial Protection Bureau on September 16. I sent a communication to all employees about the lawsuit on the day it was filed.
For your reference, attached is a “plain English” summary of the matters covered in the 8K.
Our financial situation remains challenging, but I sincerely appreciate the sacrifices you are making to help us fund operations until the sale of the schools can be completed. I understand that the furloughs have been especially difficult and created financial hardships for many. In addition, you are managing with fewer staff and lower budgets, while keeping our schools and operations functioning as smoothly as possible under incredibly challenging circumstances. Thank you for your on-going dedication to our company and its students.
If your employees have questions about the 8K, please feel free to share this information.
Jack