Consent and Waiver Letter Agreement dated as of September 23, 2021, by and among Lincoln Educational Services Corporation and certain of its subsidiaries, and Sterling National Bank

Exhibit 10.3

Sterling National Bank

61 South Paramus Road, Suite 116

Paramus, New Jersey 07652

September 23, 2021                                                             

VIA EMAIL

Lincoln Educational Services Corporation

200 Executive Drive

West Orange, New Jersey 07052

Attention: Brian K. Meyers, CFO

Dear Mr. Meyers:

Reference is hereby made to that certain Credit Agreement dated as of November 14, 2019 (as amended, modified, or supplemented from time to time, including by that certain First Amendment to Credit Agreement dated as of November 10, 2020, together with any subsequent amendments thereto, the “Credit Agreement”) by and among Lincoln Educational Services Corporation, Lincoln Technical Institute, Inc., Nashville Acquisition, L.L.C., New England Acquisition, LLC, Euphoria Acquisition, LLC, LCT Acquisition, LLC, NN Acquisition, LLC and LTI Holdings LLC (individually and collectively, “Borrower”) and Sterling National Bank (“Bank”) pursuant to which Bank made available to Borrower certain senior secured credit facilities consisting of (i) a $15,000,000.00 senior secured revolving line of credit (the “Line of Credit”); (ii) a $20,000,000.00 senior secured term loan (the “Term Loan”); (iii) a $10,000,000.00 senior secured revolving loan facility available for the issuance of letters of credit (the “LC Facility”); and (iv) a $10,000,000.00 delayed draw term loan (the “Delayed Draw Term Loan” and together with the Line of Credit, the Term Loan and the LC Facility, the “Credit Facilities”). Capitalized terms used herein without definition shall have the meaning assigned to such terms in the Credit Agreement. The Credit Facilities are secured by, among other things, (i) that certain Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing by Lincoln Technical Institute, Inc. in favor of Bank, for the property located in the State of Texas, (ii) that certain Deed of Trust and Security Agreement by LTI Holdings, LLC, in favor of Bank, for the property located in the State of Colorado, and (iii) that certain Deed of Trust and Security Agreement by Nashville Acquisition, L.L.C., in favor of Bank, for the property located in the State of Tennessee, each dated as of November 14, 2019 and as each of the same may be amended, restated, modified or supplemented from time to time ( collectively, the “Mortgages”).

Borrower has notified Bank that it desires to convey all of its right, title and interest in its real property, improvements and certain personal property located at or otherwise related to (i) 1194 East 45^th Avenue, Denver, Colorado (the “Colorado Subject Property”), pursuant to the terms, conditions and provisions of that certain Agreement for Purchase and Sale of Real Property dated on or about the date hereof (the “Colorado and Texas Disposition Agreement”), (ii) 2915 Aloutte Drive, Grand Prairie, Texas (the “Texas Subject Property”), pursuant to the terms, conditions and provisions of the Colorado and Texas Disposition Agreement, and (iii) 524 Gallatin Avenue, Nashville, Tennessee (the “Tennessee Subject Property”, and together with the Colorado Subject Property and the Texas Subject Property, collectively, the “Subject Properties”), pursuant to the terms, conditions and provisions of that certain Contract for the Purchase of Real Estate dated on or about the date hereof (the “Tennessee Disposition Agreement”, and together with the Colorado and Texas Disposition Agreement, collectively, the “Disposition Agreements”), in each case free and clear of the Mortgages and any other liens of Bank pursuant to the Mortgages or otherwise, and to lease Subject Properties following their sale (the “Subject Transactions”). Inasmuch as, (i) the Subject Properties and related personal property are subject to the Mortgages and serve as Collateral for all of the Obligations and Borrower does not intend to discharge all of the Obligations with the proceeds of the dispositions of the Subject Properties and (ii) the dispositions of the Subject Properties and related assets contemplated by the Disposition Agreements and the other Subject Transactions are restricted by Section 7.3, 7.6 and 7.7 of the Credit Agreement, Borrower has requested the consent of Lender to proceed with said dispositions as contemplated in the Disposition Agreements and to waive any default or event of default that would otherwise arise out of the consummation of the Subject Transations.

To induce Bank to grant said waiver consent, Borrower hereby represents and warrants that, other than with respect to the violations described above and consented hereto:

Based on the foregoing, but subject to the conditions set forth below, Bank hereby consents to the Subject Transactions and waive any default or event of default that would otherwise arise out of their consummation. For the avoidance of doubt, the parties hereto hereby confirm that the consent and waiver set forth herein pertains only to the Subject Transactions, and only to the extent described herein. Any leases which are part of the Subject Transactions shall not be considered in determining whether lease payments otherwise permitted under Section 7.3 exceed $1,000,000 in the aggregate.

It is expressly understood and agreed that Bank’s consent as set forth above is expressly conditioned on the following:

For the avoidance of doubt, the parties hereto acknowledge and agree that Bank shall not be obligated to release its Mortgage and other liens on related personal property unless and until the Subject Transaction to which such Mortgage and other liens relate is consummated. Accordingly, upon the consummation of the first Subject Transaction yielding sufficient proceeds to satisfy the payment obligations in clause (a) above, Bank shall release its Mortgage and other liens on personal property related to such Subject Transaction and shall release its Mortgage and other liens on personal property with respect to the second Subject Transaction to be consummated upon said consummation so long as at such time, no Default or Event of Default then exists and is continuing.

Upon the satisfaction of the aforementioned connection and in connection with the consummation of the Subject Transactions, Bank hereby agrees to execute and deliver to Borrower such discharges of the Mortgages and any other instruments related to the discharge of said mortgage and other liens, in each case as Borrower may reasonably request.

Furthermore, the parties acknowledge and agree that as of the date hereof advances under the Delayed Draw Term Loan shall no longer be available to Borrower and any commitment of Bank to lend thereunder shall be terminated and of no further force and effect.

The grant by Bank of the consent set forth herein shall in no way alter the existing obligations of Borrower under the Loan Documents, other than as specifically contemplated herein. Under no circumstances shall such waiver and consent be interpreted or construed as establishing a custom or course of dealing between Borrower and Bank with respect to any instance of non-compliance with the terms of the Loan Documents that might arise in the future. Bank reserves its right to respond in accordance with the Loan Documents to such instances of non-compliance in any manner it deems necessary or appropriate under those specific circumstances.

Bank’s waiver and consent as set forth herein shall not be effective unless and until Bank has received this letter fully executed and validly delivered by all parties hereto.

Borrower agrees to pay the fees and expenses of Bank’s counsel for services rendered in connection with this preparation of this letter agreement (including services rendered in connection with this consent and the review of any due diligence in connection therewith) promptly upon presentation of an invoice from said counsel for said services.

This letter agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto are on the same instrument. This letter agreement may be executed and delivered by facsimile or by .pdf file and upon such delivery the facsimile or .pdf signature will be deemed to have the same effect as if the original signature had been delivered to the other party. This letter agreement shall be construed in accordance with the substantive laws of the State of New Jersey without reference to any conflicts of law principles.

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