AMERICAN PUBLIC EDUCATION INC

Current report

There are risks associated with the Combination, including with respect to the anticipated timeline.

Current report

We previously disclosed that we had anticipated completing the Combination in the third quarter of 2025 subject to obtaining required approvals and ED taking related actions. At its June 2025 meeting, HLC approved the Combination and continuation of accreditation upon implementation of the related transactions. As a result of ongoing dialogue with ED and HLC as to their preferred implementation process for and the timing of the Combination, the implementation of the Combination may be postponed, including potentially into the second quarter of 2026.

Current report

For additional information regarding risks related to the Combination, see our Form 10-K and the Risk Factor in that Form 10-K with the caption beginning “The planned combination of APUS, RU, and HCN….”

Current report

The OBBBA may adversely impact us or our students’ ability to participate in federal student financial aid programs, which could have a significant adverse impact on enrollments and our business, operations, and financial results.

Current report

As discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Overview – Legislative and Regulatory Activity– The One Big Beautiful Bill Act”, President Trump recently signed into law the OBBBA, which, among other things, makes significant changes to federal student financial aid programs and eligibility requirements for such programs. New caps on federal loans for graduate and professional students and parents of undergraduates may limit borrowing options for our students and the accountability framework and related earnings test may limit the availability of certain programs due to a potential loss of Federal Direct Loan eligibility. These changes may impact our students’ ability to participate in federal student loan programs, which may have a significant adverse impact on enrollments and our business, operations, and financial results. Various portions of the OBBBA may go through negotiated rulemaking prior to implementation, and we cannot predict the timing or outcome of those negotiations or the rulemaking process.

Previous report

RU’s Florida ADN programs may be adversely impacted by recently enacted legislation, which could have a significant adverse impact on RU’s business, operations, financial results, and reputation.

Previous report

In May 2025, the Florida legislature passed legislation, which absent a veto by Florida’s governance will take effect July 1, 2025, that, among other things:

Previous report

•allows FBN to consider adverse actions taken against RU nursing programs in other states when determining whether to approve a program, to deny approval if an RU program in another state is terminated (or a similar action is taken), and to take other actions in instances of adverse actions other than termination upon an investigation into any such action;

Previous report

•reduces from two years to one year the amount of time an approved nursing program can fail to meet the state standard for NCLEX pass rates before being placed on probation;

Previous report

•reduces from three years to two years the length of time a nursing program can spend on probation;

Previous report

•requires FBN to terminate a nursing program upon the program’s failure to meet NCLEX pass rate requirements following two years of probation and upon failure to submit to FBN a legally compliant annual report;

Previous report

•subjects nursing program directors to disciplinary action and penalties for failing to submit to FBN a legally compliant annual report or for failing to submit a remediation plan, or timely present such plan to FBN, following one year of NCLEX pass rates not meeting the state standard;

Previous report

•requires FBN to deny approval of an application for a new prelicensure nursing program if an institution has an existing program that is on probation;

Previous report

•requires standardization of certain admissions criteria;

Previous report

•requires establishment of an exit examination and criteria for remediation for those who do not pass the exit examination, which must be provided to and approved by FBN;

Previous report

•requires nursing programs placed on probation to provide free remediation to students who do not pass the exit examination or NCLEX and reimburse the total cost of tuition and fees for all first-time NCLEX takers who do not pass after completing a program with a passage rate of below 30% for the calendar year;

Previous report

•authorizes FBN to deny an application for approval of a nursing program if FBN determines that the applicant is owned by an entity that owns, controls, or holds 25% or more financial or ownership interest in a program on probation at the time of its closure; and

Previous report

•authorizes FDH staff to conduct on-site inspections or evaluations of nursing programs to assess compliance with statutory requirements or for prosecution, as necessary.

Previous report

The legislation is expected to lead to increased challenges in hiring and retaining qualified nursing program directors and increased expenses related to compliance with new requirements, such as those related to standardized admissions criteria, exit examinations, remedial programs for students, and tuition and fees reimbursement to students who fail the NCLEX if RU’s pass rate is less than 30%. In addition, the legislation shortens the period before a program will be placed on probation due to low NCLEX scores and shortens the length of time a program can spend on probation, and it allows FBN to impose disciplinary remedies on an approved program against which an adverse action has been taken by another regulatory jurisdiction in the United States without defining what constitutes an adverse action or when a program in another jurisdiction would be considered equivalent to an approved program in Florida. The Florida ADN programs and several RU nursing programs in other states have previously been, and may in the future be, subject to disciplinary actions by state regulatory bodies for failure to meet applicable NCLEX pass rates or other requirements, including disciplinary actions that could be deemed adverse actions by FBN for purposes of the legislation’s requirements. The full impact of the legislation is unclear at this time, including because the legislation will be subject to rule-making that could clarify or expand the potential impact. Failure to comply with the new legislation and any adverse action taken as a result could adversely impact our business, operations, financial results, and reputation, including RU’s ability to expand or operate in Florida.

Previous report

In previous years, RU’s Florida ADN programs at its Fort Myers, Tampa, and Ocala, Florida, campuses, along with the Ocala campus satellite program at North Orlando, Florida, have been episodically placed on and then removed from probation. In February 2023, FBN placed RU’s Fort Myers, Florida ADN program on probation based on failure to satisfy the state’s NCLEX pass rate standard for two consecutive years. In March 2024, FBN placed RU’s ADN programs at its Tampa, and Ocala, Florida, campuses, along with the Ocala campus satellite program at North Orlando, Florida, on probationary status based on failure to satisfy the state’s NCLEX pass rate standard for two consecutive years. In January 2025, RU’s ADN programs at its Fort Myers, Tampa, and Ocala, Florida campuses received notification from FBN that the programs met NCLEX pass rate requirements, and they were removed from probationary status at FBN’s February 2025 Board meeting. In addition, in May 2024, the Florida Commission for Independent Education, or FCIE, reviewed RU for a substantive change due to financial stability concerns and concerns related to FBN’s probation action related to the Fort Myers, Tampa and Ocala, Florida ADN programs. FCIE subsequently placed RU on a provisional license. In May 2025, in light of the ADN programs’ removal from probation and RU’s positive working capital, FCIE moved RU from a provisional license back to a full License by Means of Accreditation.

Previous report

In addition, as previously disclosed, the planned combination of APUS, RU, and HCN into one consolidated institution will result in part in a division tentatively named Rasmussen that will be comprised of RU’s campus-based and online nursing programs, RU’s healthcare programs, HCN’s campus-based nursing and healthcare programs, and RU’s non-healthcare programs. Under the new legislation, following completion of the Combination, FBN and FDH could take action based on adverse actions that a different state agency takes with respect to HCN or Rasmussen nursing programs offered outside Florida.