12.	SUBSEQUENT EVENTS

On May 15, 2018, seven of our schools were notified by Accrediting Commission of Career Schools and Colleges (“ACCSC”) that its commission voted at its May 2018 meeting to award those campuses with an initial grant of accreditation. The accreditation transition process began when our current accreditor of these schools, Accrediting Council for Independent Colleges and Schools (“ACICS”), lost its recognition with the U.S. Department of Education (“ED”), on December 12, 2016. In order to retain eligibility for Title IV, Higher Education Act of 1965, as amended, (“HEA”) programs, our seven schools were required to obtain accreditation by an ED-recognized accrediting agency within 18 months of December 12, 2016. While ACICS had its recognition restored with ED on April 3, 2018, relieving our seven schools of the necessity to obtain accreditation by an ED-recognized agency by June 12, 2018, we will nonetheless be transitioning the seven schools to accreditation by ACCSC.

Our Southington, Connecticut campus was notified in correspondence dated May 14, 2018, by the New England Association of Schools and Colleges (“NEASC”), the college’s institutional accreditor, that its Commission on Institutions of Higher Education directed the school to show cause why it should not be placed on probation. The reasons for the show-cause directive include the Commission’s belief that our Southington school may not meet seven of NEASC’s Standards of Accreditation. The Southington school will have an opportunity to respond by June 13, 2018, to the show-cause directive to evidence its compliance with the NEASC Standards of Accreditation. Further, the school has been given the opportunity to present its response to the show-cause directive during an in-person hearing at the NEASC Commission meeting on June 28, 2018. Our Southington school believes that the areas noted in the May 14, 2018, correspondence from NEASC have previously been satisfied as documented in the college’s self-evaluation report, its October 2017 visiting team report, or the college’s response to the visiting team report dated March 29, 2018. We expect to hear from NEASC on the Southington school’s response to the show-cause directive in July 2018.