ITT Educational Services Inc. (NYSE: ESI) was absolutely clobbered on Monday. Things are bad enough that this is no longer just a 52-week low concern. Things have been bad for years in the for-profit secondary education market, and now we have a whole set of fresh concerns to worry about. ITT Educational submitted notice of a fourth amendment to its credit facility after the close on Friday. The new terms appear to be far more restrictive.

The SEC filing showed that obligations under the new credit agreement must be secured by mortgages by September 28, 2014. Asset dispositions will be limited to $5 million and secured debt is reduced to $5 million. Also, sale proceeds from its properties will now go to cash collateralizing and will then be used to pay down outstanding debit and credit facility use. The drop is coming as ITT Educational had a sale leaseback agreement terminated that would have generated $119 million in proceeds.

A quick note from Merrill Lynch on Monday contains very firm fears, but interestingly enough they have some upside despite the call. The analyst report said that ITT has yet to submit its audited 2013 financial statements with the Department of Education. Their worry is that the Education Department could place ITT on heightened cash monitoring, or on a provisional certification status. There is also the fear that the department could require ITT to post a new letter of credit.

Merrill Lynch has a Neutral rating, and the firm lowered its price target to $16 from $19 in the call, based on its lower cash balance and uncertainty around the department’s reaction to delayed financial statements.

ITT Educational Services historically has boasted a strong presence in its market, but over the past few years it has fallen from grace — and then some. The beginning of 2014 marked the end to a strong recovery period for the ITT Educational Services, with the stock peaking at $45.80, to where it has since fallen more than 35% to as low as $9.66.

As of 1:00 p.m. Eastern Time ITT Educational shares were down 31% at $9.86, and the trading volume was exponentially higher than normal — 4 million shares versus just over 600,000 for a normal day’s volume.

Within the past five years, ITT Educational was even a $100.00 stock. Again, this is beyond 52-week lows. This is multiyear lows, and the sector woes have reached a point that many investors fear the future.

ALSO READ: 4 For-Profit Education Stocks That Could Be in Trouble

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