Thread regarding ITT Educational Services Inc. layoffs

Did ITT make their letter of credit? I can't find any new articles

I don't think it is coincidence that all of the recent campus layoffs coincides at the same time that $43.3M was needed in a new letter of credit with the DOE.

https://consumerist.com/2016/06/07/is-itt-tech-headed-for-a-collapse-school-required-to-set-aside-funds-just-in-case/

The salary dump seems like a long term cash grab to say, "hey, we're solvent!" We now just passed the month deadline and there has been crickets in the news about this. Does anyone have any update regarding if they actually came up with the cash or are in the process of appealing the decision?

by ITTFollower
| 1421 views | | 7 replies (last July 22, 2016) | Reply
Post ID: @OP+Ilc3moC
Comment! It's anonymous!

7 replies (most recent on top)

Well... if my debt is going to get wiped out anyways... mind as well go back to school there.

by One Smart Cookie
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Post ID: @amln+Ilc3moC

So they're hoping to reduce the escrow, what about all the thousands like me who are on the DTR and will get reimbursed for over $100,000 each?

by Anonymous
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Post ID: @3fny+Ilc3moC

@2dhv, I agree with you completely. Interesting strategy.

Lower enrollment means less money for them to pay to DoED. Laying off recruiters makes sense now, since it will help keep the enrollment down, as well as saving personnel costs.

What's left of the organization, though? A few managers, a pile of bureaucratic policies, and some real estate? ITT-Tech has already gutted their organization of most qualified faculty. Now they are laying off experienced recruiters. Their curriculum is already poor quality, and campus equipment outdated. They are out of cash.

What's next? Any insight on that? What will happen with the 40,000 students remaining? Is ITT-Tech gearing up for massive teach out?

by Anonymous
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Post ID: @2hhf+Ilc3moC

They've agreed to a deal in which they will place the additional funds in escrow in three installments. They believe, however, that by the time they've posted the second installment or at some point before the third becomes due they'll be able to determine that the total they then have in escrow will be equal to the amount required of them. In other words, their business is drying up sufficiently that the % required of them will equate to a numerical amount significantly less than calculated now.

by Not the ADGS
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Post ID: @2dhv+Ilc3moC

More from July 12 SEC filing.....

"The sanctions imposed on the Company by the ED could have a material adverse effect on the Company's financial condition, results of operations, cash flows and ability to meet its contractual and regulatory obligations."

by Anonymous
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Post ID: @1lgl+Ilc3moC

There is further info in this SEC filing:

http://app.quotemedia.com/data/downloadFiling?webmasterId=101533&ref=11035960&type=PDF&symbol=ESI&companyName=ITT+Educational+Services+Inc.&formType=8-K&dateFiled=2016-07-12

It includes this statement:

"The Company expects to provide to the ED the Additional Amount from its operating cash flows, with those funds to be maintained by the ED in an escrow account. In order to generate sufficient cash from operations to provide the Additional Amount, the Company expects to implement certain modifications to its historical marketing and recruitment strategy."

by Anonymous
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Post ID: @1nqo+Ilc3moC

Does it really even matter, ACICS is headed for a fast death and this place is one of the main reasons why. No other accreditor is going to touch them with a 1000 foot pole. The gainful employment rule will also closeline this company as their numbers are the worst in the industry.

by Anonymous
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Post ID: @gmg+Ilc3moC

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