SEPARATION AND RELEASE AGREEMENT

SEPARATION AND RELEASE AGREEMENT

THIS SEPARATION AND RELEASE AGREEMENT (“ Agreement ”) is made between Lincoln Educational Services Corporation (the “ Company ”) and Lawrence E. Brown (“ you ”), and is in consideration of their mutual undertakings as set forth in this Agreement.

WHEREAS, the Company and you entered into that certain Employment Agreement, dated as of February 1, 2007 (the “ Employment Agreement ”);

WHEREAS, the Company and you mutually agree to terminate the Employment Agreement and enter into this Agreement, which shall set forth the terms of your separation of employment from the Company and shall supersede all prior agreements between the parties regarding the subject matter contained herein; and

WHEREAS, in consideration for the payments provided hereunder, you agree to comply with the non-competition, non-solicitation and other restrictive covenants set forth in Section 8 hereof.

NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth in this Agreement, the parties hereto hereby agree as follows:

1.          Termination . Effective as of the close of business on October 31, 2007 (the “ Effective Date ”), your employment with the Company shall terminate.

2.          Nonadmission of Liability . This Agreement shall not be construed as an admission by the Company that it acted wrongfully with respect to you, nor shall this Agreement be construed as an admission by you of any misconduct.

3.          Termination Pay and Benefits . In consideration of the waiver and release of claims set forth below, the Company shall provide you with the following severance payments and benefits:

(a)        Severance . The Company shall pay you a lump sum cash payment equal to $446,666.67, less all lawful or required deductions. Such amount shall be paid no later than the thirtieth day following the Effective Date, subject to your execution of this Agreement and the irrevocability of the release.

(b)        Benefits Continuation : You shall have the right to continue coverage under the Company’s group medical and dental plans in accordance with and subject to the provisions of the Consolidated Omnibus Budget Reconciliation Act of 1986 (“ COBRA ”). The Company shall reimburse you for the employer-portion of the premiums due for continued participation in the Company’s group medical and dental plans under COBRA until the earlier of (i) December 31, 2008 and (ii) the date you are covered under the group medical and dental plans of another employer. Any further continued coverage under COBRA, if available, shall be at your expense.

(c)        Automobile . You shall be entitled to the continued use of your automobile and reimbursement of associated costs by the Company, through December 31, 2008.

(d)        No Other Compensation . Except as otherwise specifically provided herein or as required by applicable law, you shall not be entitled to any compensation or benefits or to participate in any past, present or future you benefit programs or arrangements of the Company (including, without limitation, any compensation or benefits under any severance plan, program or arrangement) on or after the Effective Date.

4.          References . All requests for references shall be routed to the Company’s Vice President of Human Resources. The Company’s response shall be limited to the dates of your employment and your job title. No additional information shall be released.

5.          Transitional Services . You agree that, for a period of 14 months following the Effective Date, you will make yourself reasonably available, upon reasonable advance notice, to provide transitional assistance to the Company, on an hourly basis and at your rate of annual base salary immediately prior to the Effective Date. It is anticipated that such services shall not exceed 10 hours per month. You will be performing such services as an independent contractor of the Company, and you agree that you will not hold yourself out as an employee, agent, representative or party of the Company.

6.          Support for Legal Matters . You also agree, within reasonable convenience to you, to cooperate with the Company in any legal action for which your participation is needed. The Company agrees to try to schedule all such meetings so that they do not unduly interfere with your pursuits after the Effective Date. The Company agrees to reimburse you for reasonable out-of-pocket expenses incurred in connection with your services described in this Section 6.

(a)        Non-Competition . For 14 months following the Effective Date, you shall not, without the prior written consent of the Company, directly or indirectly, own, manage, operate, join, control, or participate in the ownership, management, operation or control of, or be employed by or connected in any manner with, any Competing Business, whether for compensation or otherwise; provided , however , that you shall be permitted to hold, directly or indirectly, any class of securities of any entity that is listed on a national securities exchange or on the NASDAQ National Market System. For purposes of this Agreement, “ Competing Business ” means any publicly-traded company within the United States that involves for-profit, post secondary education.

(b)        Non-Solicitation . For 14 months following the Effective Date, you shall not, without the prior written consent of the Company, directly or indirectly, as a sole proprietor, member of a partnership, stockholder, investor, officer or director of a corporation, or as an employee, associate, consultant or agent of any person, partnership, corporation or other business organization or entity other than a member of the Company

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or any of its subsidiaries or affiliates (the “ Company Group ”) (i) solicit or endeavor to entice away from any member of the Company Group, any person or entity who is, or was as of the Effective Date, employed by, or serving as a key consultant of, any member of the Company Group or (ii) solicit or endeavor to entice away from any member of the Company Group, any person or entity who is, or was as of the Effective Date, a customer or client (or reasonably anticipated to become a customer or client) of any member of the Company Group.

(c)        Confidentiality . You shall not, at any time, except in performance of your obligations to the Company Group, directly or indirectly, disclose or use any secret or protected information that you may have learned by reason of your association with any member of the Company Group. The term “ protected information ” includes trade secrets and confidential and proprietary business information of the Company Group, including, but not limited to, customers (including potential customers), sources of supply, processes, methods, plans, apparatus, specifications, materials, pricing information, intellectual property (including applications and rights in discoveries, inventions or patents), internal memoranda, marketing plans, contracts, finances, personnel, research and internal policies, but shall exclude any information which (i) is or becomes available to the public or is generally known in the industry or industries in which the Company Group operates other than as a result of disclosure by you in violation of this Section 8(c) or in violation of your Employment Agreement or (ii) you are required to disclose under any applicable laws, regulations or directives of any government agency, tribunal or authority having jurisdiction in the matter or under subpoena or other process of law.

(i)        All protected information is and shall remain the exclusive property of the Company Group. All business records, papers and documents kept or made by you relating to the business of the Company shall be and remain the property of the Company Group. Upon the request and at the expense of the Company Group, you shall promptly make all disclosures, execute all instruments and papers and perform all acts reasonably necessary to vest and confirm in the Company Group, fully and completely, all rights created or contemplated by this Section 7(d).

(ii)       You acknowledge that you have returned to the Company Group all property owned by the Company Group in your possession, specifically including all keys and keycard badges, all company-owned equipment and all Company Group documents, and computer-stored or transmitted information, specifically including all trade secrets, and/or confidential information of the Company Group.

(e)        Compliance with Restrictive Covenants . Without intending to limit any