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Change of Ownership

 


About the Change of Ownership Application

Section 2-2-400 of the Accreditation Criteria provides for an automatic, self-executing discontinuation of accreditation effective on the date of a change of ownership/control of an institution accredited by ACICS. It then becomes the responsibility of the institution under the new change of ownership or control to seek a reinstatement of accreditation. The Council does not approve these changes before the transaction actually has occurred.

Upon receipt of a change of ownership notification or application, the Council will notify various federal and state agencies of the fact that the accreditation of the institution has been discontinued due to the changes. When the Council is not in session, the Council may, at its discretion, grant a temporary reinstatement of accreditation for a period of time sufficient to consider the application at a regularly scheduled meeting.

ACICS is required by the recognition provisions of the U.S. Department of Education to conduct an on-site visit within six months of the date of a change of ownership or control. The Council will not grant final reinstatement of accreditation until the visit has occurred and the report has been considered by the Council in regular session.
Sections 2-2-400 through 2-2-403 of the Accreditation Criteria provide an in-depth explanation of the change of ownership and control policies and procedures.

 

Time Frame to Receive Interim Approval
Although the Council recognizes the need for timely processing of change of ownership requests, institutions are forewarned that incomplete applications cannot be processed.  Complete applications include all of the exhibits listed in this application, documentation of continuing or new state licensure, and evidence of financial stability.  The filing of an incomplete application will result in a delay in processing.  The Council generally will respond to complete applications in less than five business days.


Financial Statement Requirements
A temporary reinstatement may be granted upon receipt of an unaudited balance sheet of the senior parent corporation or other permissible ownership entity of the institution, certified as true and correct by the chief executive officer, for a date reflecting the new ownership or control (that is, for a date no earlier than the date of the change).  Prior to final consideration by the Council, the institution must submit an audited balance sheet, certified by an independent certified public accountant, for a date reflecting the new ownership or control.

 

On-Site Evaluation
ACICS is required by the recognition provisions of the United States Department of Education to conduct an on-site visit within six months of the date of a change of ownership or control.  As part of this review, the Council will evaluate the experience of the administrative management of the institution under the new ownership or control and any changes at the institution as a result of the transaction. The Council will not grant final reinstatement of accreditation until the visit has occurred and the report has been considered by the Council in regular session.


Refund Liability
The Council holds the institution responsible for all tuition refunds due regardless of when the liability occurred.  If a previous owner is contractually liable for a refund but fails to fulfill the obligation, the new owner must satisfy the claim of the student or government agency and seek relief from the former owner in a separate action.


Contingent Liabilities
Contingencies generally are not allowed on the transfer, and in no case will the Council consider an application that contains any contingency regarding the institution's reinstatement of accredited status under the new ownership or control.


Comparison of U.S. Department of Education and state regulations with ACICS Accreditation Criteria
Some of the actions not considered to be a change of ownership or control by the Council may be a change of ownership or control under federal or state law.  Conversely, some changes that are not considered to be a change of ownership by federal or state law are changes of ownership or control under the ACICS Accreditation Criteria.  Please consult the ACICS staff and appropriate state and federal regulators anytime changes are made in the ownership structure of the controlling entity to assure that the institution remains in compliance with all rules and regulations.


Professional Advisors
ACICS strongly advises institutions to seek professional advice when they are contemplating a change of ownership or control.  The various state, accreditation, and federal requirements can be complicated, and filing errors can lead to lengthy delays in gaining approvals.

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Payment Information

Please note that all outstanding invoices must be paid before purchasing an application. To view outstanding orders, go to MY ACCOUNT once you are logged in.

For a complete list of fees, see the Schedule of Fees. For payment by check, see the following instructions. 

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Application Process 

RESPONSIBLE 
PARTY
ACTION STEP
Institution
STEP 1 - Registration

New owning corporations (corporate registration), Chief Executive Officers (individual registration), partners (company registration) and individuals responsible for operations (individual registration) are required to register with ACICS.

Click here "For Guidance on How to Register"

Institution

 

 

 

 

 

  

 

 

 

 

 

STEP 2 - Document Preparation

Download and complete the following documents:
               • Buyer / Seller Affidavit and Certificate  Microsoft Word 2007
               • Statement of Responsibility for Refund Liability     
               • Ownership / Control Disclosure Form. 
                   Select one of the following forms:
                   • Privately Held Corporation    
                   • Limited Partnership with Corporate General   
                   • Publicly Traded Corporation      
                   • Not for Profit Corporation     
                   • Limited Liability Company    
                   •Designated Delegate Form                                        

              • Change of Ownership Application  Adobe logo

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In addition to the above documents, prepare the following documents for submission

               • Evidence of state authorization to operate the institution
                  under the new ownership or control

               • Member institution’s most recently completed audited
                  financial statement

               • Member institution’s most recent Annual Financial Report

               • Owning corporation’s opening day balance sheet
                  A balance sheet of the institution’s first corporate level, as 
                  well as the parent corporation or senior 
                  ownership entity, for a date reflecting the new ownership or 
                  control (that is, for a date no earlier than the date of the 
                  change) and certified as true and correct by the chief 
                  executive officer.

               • Owning corporation’s CEO certification of balance sheet

               • Organizational chart representing ownership change

               • Contract of Sale or Purchase Agreement
                  A complete copy of the contract of sale or purchase 
                  agreement and all documents related to the change of 
                  ownership including, the bill of sale enacted on the date 
                  of closing, promissory notes, management agreements, 
                  consulting agreements, noncompete agreements, and, if 
                  the sale is a stock purchase, photocopies of the stock 
                  certificates indicating the transfer of ownership.

               • Stockholder’s personnel profile(s) (resume)
                  Personnel profiles outlining the preceding ten years that 
                  include the education, experience, and all proprietary 
                  school affiliations of the top three on-site administrators. 
                  These profiles also must be submitted for all stockholders 
                  having 10% or more of the stock or ownership interest in 
                  the owning entity or corporation (does not apply to publicly 
                  held corporations)

                  NOTE: All resumes are to be combined in one document for 
                  submission to the ACICS electronic document management 
                  system (EDM) in Step 3. 

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STEP 3 - Purchase Change of Ownership Application 
                Process

                Instructions for purchasing an application. 

Institution

STEP 4 - Submit completed documents listed in Step 2
               along with an audited balance sheet.
An audited balance sheet for the institution’s senior parent corporation or ownership entity level with complete disclosures, certified by an independent Certified Public Accountant, for a date reflecting the new ownership or control.
                 Instructions for uploading documents. 

ACICS
STEP 5 - ACICS sends letter to institution regarding 
                temporary accreditation reinstatement

 

ACICS
STEP 6 - Review documentation / Schedule Site Visit

 

ACICS & Institution
STEP 7 - Site Visit

 

Institution
STEP 8 - Response

A response to the team report of the evaluation visit conducted after the change of ownership or control.

 

ACICS
STEP 9 - ACICS will notify the institution of Council’s 
               decision and post  with all regulatory agencies.

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