Stephen Ace
LINCOLN EDUCATIONAL SERVICESAbout Stephen Ace
Stephen E. Ace is Senior Vice President and Chief Human Resources Officer at Lincoln Educational Services (LINC), with 16 years of company service as of May 2025 . His role centers on human capital management across ~2,475 employees, with workforce growth of ~8% in 2024 and a student-to-teacher ratio of ~16.5:1, indicating operational scale and HR execution relevance . During his tenure, LINC delivered strong 2024 performance: revenue $440.1 million (+16.4% YoY) and adjusted EBITDA $42.3 million; net income was $9.9 million, and TSR value of an initial $100 investment reached $212 by year-end 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Lincoln Educational Services (LINC) | SVP, Chief Human Resources Officer | 16 | Leads HR amid growth, union relations, and retention initiatives; workforce ~2,475 (+8% YoY); student-to-teacher ~16.5:1 |
Fixed Compensation
| Component | Detail |
|---|---|
| Base Salary | $285,000 per annum under Dec 13, 2022 employment agreement; effective Jan 1, 2023 (eligible for upward adjustment) |
| Annual Bonus Eligibility | Eligible under the Company’s Key Management Team Incentive Compensation Plan (MIC Plan), with payout based on performance targets set by Board/Compensation Committee |
| Bonus Basis (Program Design) | Company-wide MIC Plan payments tied to adjusted EBITDA target attainment; payouts for NEOs were fully based on adjusted EBITDA in 2024 |
Performance Compensation
| Metric | Weighting | Target | Actual/Payout Basis | Vesting/Timing |
|---|---|---|---|---|
| Adjusted EBITDA (MIC Plan, cash) | 100% for 2024 (program design) | Company-set annual adjusted EBITDA objective | Payouts depend on achieved adjusted EBITDA vs target; Committee has discretion but did not exercise in 2024 (NEO program) | Cash paid after year-end per MIC Plan timing |
| Performance-Based Restricted Stock (PBRS) | 50% of restricted stock mix (management program design) | Annual adjusted EBITDA targets for each year in 3-year cycles (e.g., 2024–2026) | One-third vests per year upon target attainment; performance cycles attained 2024 targets, vesting one-third for cycles started 2022–2024 | 3-year vesting, annual determinations; Committee may exercise discretion and has removed “catch-up” for awards issued after 12/31/2023 |
The Company’s long-term equity program grants a mix of time-based and performance-based restricted stock (typically 50/50), with PBRS linked to adjusted EBITDA, vesting one-third annually over three years; time-based awards also vest ratably over three years .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (Common) | 148,453 shares (Form 3 filed Feb 21, 2025) |
| Shares Outstanding Reference | 31,592,807 shares outstanding as of Mar 20, 2025 |
| Ownership % of Outstanding | ~0.47% (148,453 / 31,592,807) based on Form 3 and outstanding shares |
| Vested vs Unvested Shares | Not disclosed for Ace; NEO outstanding awards detailed separately |
| Hedging/Pledging | Code of Conduct prohibits pledging, margin accounts, and hedging for directors, executive officers, and senior management (exceptions only via Board discretion) |
| Clawback | Clawback policies cover recovery of performance-based cash and equity compensation; RS agreements reference Compensation Recovery Policy |
| Ownership Review | Executive stock holdings reviewed annually to ensure alignment with competitive standards |
Note: We searched for Form 4 insider transactions and did not find additional disclosures; our review included SEC filings and company documents up to Nov 19, 2025. If you need a full Form 4 history, we can expand the search.
Employment Terms
| Category | Provision |
|---|---|
| Agreement & Term | Employment Agreement dated Dec 13, 2022; term through Dec 31, 2025 unless earlier terminated |
| Role & Reporting | SVP, Chief Human Resources Officer; reports to CEO & President; exclusive services and substantial time devotion |
| Base Salary | $285,000 per annum; upward adjustments permitted |
| Annual Bonus | Eligible under MIC Plan; performance targets set by Board/Compensation Committee; paid by Mar 15 following fiscal year |
| Involuntary Termination (Severance) | Lump-sum equal to 1.5× (base salary + target annual bonus) + employer portion of health premiums up to 1 year + prorated current-year bonus (subject to waiver/release and covenant compliance) |
| Termination (Death/Disability) | Accrued salary/benefits + prorated target bonus; full vesting of options/restricted stock, options exercisable for one year (or normal expiry) |
| Change in Control (CIC) | Automatic 2-year term renewal commencing on CIC date; immediate full vesting of stock options and restricted stock; options immediately exercisable |
| 280G Cutback | Payments reduced to avoid excise tax if beneficial vs paying excise; no tax gross-ups |
| Restrictive Covenants | Non-compete for 2 years (not applicable if Involuntary Termination) ; Non-solicit for 1 year ; Confidentiality (unlimited duration) |
| Arbitration | Binding arbitration in Parsippany, NJ; Company bears costs if dispute concerns CIC rights (unless claim is unfounded) |
Compensation Structure vs Performance Metrics
- Company-wide MIC Plan uses adjusted EBITDA as the sole financial metric for annual cash incentives in 2024; long-term PBRS also linked to adjusted EBITDA in three-year cycles, strengthening pay-for-performance alignment .
- Compensation governance practices include capped MIC payouts at 200% of target, independent compensation consultant, clawbacks, no excise tax gross-ups, and annual stock ownership reviews, all supportive of shareholder alignment .
Vesting Schedules and Insider Selling Pressure
- PBRS and time-based restricted stock vest ratably over three years; PBRS requires annual adjusted EBITDA target attainment (with “catch-up” vesting eliminated for grants after Dec 31, 2023) .
- CIC triggers single‑trigger acceleration of equity for Ace (and automatic two-year contract extension), which may influence retention versus potential CIC windfall dynamics .
- Form 3 shows initial beneficial ownership; we found no additional Form 4 transactions in our search to Nov 19, 2025 (we searched SEC filings and company documents).
Change-of-Control Economics and Severance
- CIC: Single-trigger full acceleration of equity and two-year automatic extension; no gross-up, but Section 280G cutback applies .
- Involuntary termination: 1.5× salary + target bonus multiple, health premium stipend up to one year, and prorated MIC bonus—providing meaningful downside protection without excessive severance .
Track Record, Value Creation, and Execution Risk
- 2024 outcomes: revenue $440.1m (+16.4%), adjusted EBITDA $42.3m, net income $9.9m; student starts +15.2%; year-end cash nearly $60m, no debt—indicative of operational execution during Ace’s HR leadership tenure .
- TSR: value of initial $100 reached $212 by year-end 2024 (three-year pay-versus-performance framework) .
- HR context: Union relationships at 7 campuses, ~230 employees under CBAs expiring 2025–2027; active negotiations—an HR execution focal point .
Risk Indicators & Red Flags
- Positive: Anti-hedging/pledging code, clawbacks, independent consultant, capped incentives, no excise tax gross-up .
- Watch items: Single-trigger CIC acceleration can create windfall risk; DOE regulatory environment includes provisional certification and potential borrower defense liabilities—enterprise risks that HR retention and incentive design must navigate .
Compensation Peer Group & Say-on-Pay
- Peer group used for competitive pay benchmarking: Adtalem, Laureate, American Public Education, Perdoceo, Coursera, Strategic Education, Franklin Covey, Universal Technical Institute, Grand Canyon Education, Udemy .
- Say-on-pay: ~93% approval at 2024 annual meeting, signaling broad support for compensation framework .
Investment Implications
- Alignment: Strong pay-for-performance via adjusted EBITDA for both annual cash and PBRS supports operational discipline; clawbacks and anti-hedging/pledging enhance governance .
- Retention risk: Ace’s severance (1.5× salary+target bonus) and CIC single-trigger acceleration reduce departure risk but could incentivize CIC-linked outcomes; non‑compete (2 years) and non‑solicit (1 year) mitigate competitive leakage .
- Insider dynamics: ~0.47% beneficial stake (148,453 shares) indicates meaningful skin-in-the-game; absence of observed Form 4 activity in our search suggests limited near-term selling signals, subject to ongoing monitoring .
- Enterprise overlay: Elevated regulatory scrutiny (Title IV, BDR, 90/10, GE) is a macro risk; HR leadership’s role in compliance, staffing, and retention remains central to sustaining growth and student outcomes—reinforced by 2024 performance and TSR trajectory .