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June 17, 2014
15:27 EDTEDMCEducation Management settles with San Francisco, makes concessions
Education Management disclosed in a regulatory filing that as previously disclosed in the periodic reports of Education Management Corporation has been cooperating with the City Attorney of the City of San Francisco, California since December 2011 when the company received a letter from the City Attorney requesting information related to student recruitment and indebtedness, including recruiting practices and job placement reporting, among other issues, by The Art Institute of California - San Francisco and all other Art Institute locations in California. On June 17, the company entered into an Assurance of Voluntary Compliance with the City Attorney for the purpose of resolving disputed claims, avoiding the expense of further litigation, and permitting the Company to focus on its education mission with regard to its students. Under the Assurance, without admitting liability, the company has agreed to pay the aggregate amount of approximately $4.4M, consisting of $1.95M to the City Attorney for fees and costs of the investigation and to carry out the purpose of the Assurance, $1.6M to fund a scholarship program for students who enrolled in The Art Institute of California - San Francisco or one of the California Art Institutes diploma or degree programs and did not obtain their diplomas or degrees and $850,000 for an unrestricted scholarship program for students attending one of the California Art Institutes. As part of the Assurance, the California Art Institutes agreed to, among other things: disclosure to be provided, and prescribed calculation methods, for placement rates, actual or average salaries, graduation and completion rates, transfer rates, retention rates, cohort default rates, and percentage of enrollees who finish a diploma or undergraduate degree program earlier than the planned time for completion of the diploma or undergraduate degree program; disclosure to be provided related to financial aid; training of California Art Institutes employees involved in the collection of graduate employment information; provision of appropriate placement representative-to-student ratios at each of its schools and certain placement assistance services; termination of any employee who it is determined provided or attempted to provide materially false graduate employment information for inclusion in the placement data to be published by a California Art Institute; reporting of data to the City Attorney regarding compliance with the Assurance; hiring of an independent auditor to conduct an audit of placement rates; and maintenance of written records regarding compliance with the Assurance.
News For EDMC From The Last 14 Days
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August 29, 2014
09:10 EDTEDMCKKR in deal to be among largest Education Management stakeholders, NY Post says
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August 27, 2014
10:13 EDTEDMCHigh option volume stocks
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08:39 EDTEDMCEducation Management reaches agreement in principle on debt restructuring
Education Management announced it has reached agreement in principle regarding a financial restructuring with holders of more than 80% of its secured and unsecured financial indebtedness. The company's Board of Directors has approved the restructuring. The company is seeking support for its restructuring plan from the remaining lenders and bondholders. The proposed restructuring will reduce the company's funded debt by approximately $1.1B, providing for the exchange of approximately $1.5B of outstanding debt as of June 30 for $400M of new debt, preferred equity interests that would be convertible into common shares and warrants for the purchase of common shares. The company's existing shareholders would retain 4% of the outstanding common stock after giving effect to the conversion of the new preferred stock and receive warrants to purchase an additional 5% of the common stock. The comprehensive, multi-step restructuring remains subject to applicable regulatory approvals and a shareholder vote, which the company expects to complete in 2015. Pending consummation of the restructuring, the company will enter into an amendment to its senior credit facility to waive all financial covenants through June 30, 2015, substantially decrease cash interest expense and require no principal amortization payments through June 30, 2015, and extend the maturity of the revolving credit facility through July 2, 2015.
August 24, 2014
21:23 EDTEDMCLender group set to offer EDMC revised debt package, NY Post says
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