Bostic R Steven – ‘DEFC14A’ on 4/19/06 re: Career Education Corp

On:  Wednesday, 4/19/06, at 4:18pm ET   ·   Effective:  4/19/06   ·   Accession #:  914121-6-1145   ·   File #:  0-23245

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

Definitive Proxy Solicitation Material — Contested Solicitation   —   Schedule 14A
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: DEFC14A     Def. Proxy Mat. in Conn. W/ Cont. Solicitations       20     98K 

Document Table of Contents

DEFC14A
1st Page of 20
TOC
↑Top
Previous
Next
↓Bottom
Just 1st
 
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
 Securities Exchange Act of 1934

Filed by the Registrant [ ]  Filed by a Party other than the Registrant  [X]    

Check the appropriate box:                                                      

[ ]   Preliminary Proxy Statement                                               

[ ]   Confidential, for Use of the Commission Only (as permitted by Rule        
14a-6(e)(2))                                                        

[X]   Definitive Proxy Statement                                                

[ ]   Definitive Additional Materials                                           

[ ]   Soliciting Material Pursuant to ss.240.14a-12                             

Career Education Corporation
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

Robert Steven Bostic
James E. Copeland, Jr.
R. William Ide
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (check the appropriate box):                              

[X]   No fee required.                                                          

[ ]   Fee computed on table below per Exchange Act Rule 14a-6(i)(4) and 0-11.   

1. Title of each class of securities to which transaction applies:  
     _________________________________________________________________________
2. Aggregate number of securities to which transaction applies:     
     _________________________________________________________________________

3. Per unit price or other underlying value of transaction computed 
       pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):    

     _________________________________________________________________________
4. Proposed maximum aggregate value of transaction:                 
     _________________________________________________________________________
5. Total fee paid:                                                  
     _________________________________________________________________________

[ ]   Fee paid previously with preliminary materials.                           

[ ]   Check box if any part of the fee is offset as provided by Exchange Act    
    Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
   paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.         

6. Amount Previously Paid:                                          
     _________________________________________________________________________
7. Form, Schedule or Registration Statement No.:                    
     _________________________________________________________________________
8. Filing Party:                                                    
     _________________________________________________________________________
9. Date Filed:                                                      
     _________________________________________________________________________

DEFC14A
2nd Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 2nd
 2006 ANNUAL MEETING OF STOCKHOLDERS
OF
CAREER EDUCATION CORPORATION
____________________________

 PROXY STATEMENT
OF
R. STEVEN BOSTIC
____________________________

To my Fellow Career Education Corporation Stockholders:                         

This Proxy Statement and the accompanying BLUE Proxy Card are being 
furnished to stockholders ("Stockholders") of Career Education Corporation      
("CEC") in connection with the solicitation of proxies by Robert Steven Bostic  
and the other Nominees (as defined below) to be used at the 2006 Annual Meeting 
(the "Annual Meeting") of Stockholders of CEC to be held at 3:00pm, Central     
Daylight Time, on Thursday, May 18, 2006 at the Chicago Marriott Northwest, 4800
Columbine Boulevard, Hoffman Estates, Illinois, and at any adjournments,        
postponements or continuations thereof. This Proxy Statement and the BLUE Proxy 
Card are first being furnished to Stockholders on or about April 19, 2006.      

    At the Annual Meeting, the Mr. Bostic will seek to elect to the Board of
Directors of CEC (the "Board") a slate of three nominees, comprised of Mr.      
Bostic, James E. Copeland, Jr. and R. William Ide in opposition to the slate    
proposed by the current Board. Each of the nominees (each a "Nominee" and,      
collectively, the "Nominees") has consented, if elected, to serve as a director 
of CEC and to being named in this Proxy Statement and in the Nominees' other    
soliciting materials as a Nominee.                                              

   CEC has significant problems to resolve relating to pending litigation,
its probationary status with the Southern Association of Colleges and Schools   
("SACS"), and investigations by the U.S. Department of Justice ("DOJ"), the US  
Department of Education ("DOE"), and other regulatory bodies. We believe that   
our Nominees are the best qualified candidates to lead CEC in a new direction,  
solve many of the problems in which CEC is currently embroiled and create       
Stockholder value.                                                              

     THE NOMINEES ARE INDEPENDENT AND COMMITTED TO ACTING IN THE BEST INTEREST
OF ALL STOCKHOLDERS. WE BELIEVE THAT YOUR VOICE IN THE FUTURE OF CEC CAN BEST BE
EXPRESSED THROUGH THE ELECTION OF THE NOMINEES. ACCORDINGLY, WE URGE YOU TO VOTE
YOUR BLUE PROXY CARD FOR THE ELECTION OF MESSRS. BOSTIC, COPELAND, AND IDE.     

IF YOUR SHARES ARE HELD IN THE NAME OF A BROKERAGE FIRM, BANK, BANK 
NOMINEE OR OTHER INSTITUTION ON THE RECORD DATE, ONLY IT CAN VOTE SUCH SHARES   
AND ONLY UPON RECEIPT OF YOUR SPECIFIC INSTRUCTIONS. ACCORDINGLY, PLEASE CONTACT
THE PERSON RESPONSIBLE FOR YOUR ACCOUNT AND INSTRUCT THAT PERSON TO EXECUTE ON  
YOUR BEHALF THE BLUE PROXY CARD AS SOON AS POSSIBLE.                            

IMPORTANT                                                                       

     The election of the Nominees requires the affirmative vote of a plurality
of the votes cast by Stockholders present in person or represented by proxy,    
assuming a quorum is present or otherwise represented at the Annual Meeting. As 
a result, your vote is extremely important in deciding the future of CEC. We    
urge you to mark, sign, date and return the enclosed BLUE Proxy Card to vote FOR
the election of Messrs. Bostic, Copeland, and Ide.                              

  WE URGE YOU NOT TO SIGN ANY PROXY CARD SENT TO YOU BY CEC. IF YOU HAVE
ALREADY DONE SO, YOU MAY REVOKE YOUR PROXY BEFORE IT IS VOTED BY DELIVERING A   
LATER-DATED PROXY CARD, OR BY VOTING IN PERSON AT THE ANNUAL MEETING, OR BY     
DELIVERING TO CEC (ATTENTION: JANICE L. BLOCK, SENIOR VICE PRESIDENT, GENERAL   
COUNSEL AND SECRETARY) A WRITTEN NOTICE STATING THAT THE PROXY IS REVOKED. SEE  
"VOTING PROCEDURES" AND "PROXY PROCEDURES" BELOW.                               

DEFC14A
3rd Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 3rd
    If you have any questions about giving your proxy or require assistance,
please call:                                                                    

INNISFREE M&A INCORPORATED

 501 Madison Avenue - 20th Floor
New York, NY 10022
 Stockholders Call Toll-Free: 1-877-750-9499
 Banks or Brokers Call Collect: 1-212-750-5833

Only holders of record of CEC's voting securities as of the close of
business on March 21, 2006, the record date for the Annual Meeting (the "Record 
Date"), are entitled to notice of and to vote at, the Annual Meeting and any    
adjournments or postponements thereof. According to CEC's preliminary proxy     
statement filed with the Securities and Exchange Commission (the "SEC") on April
5, 2006 under cover of Schedule 14A (the "CEC Preliminary Proxy Statement"), as 
of the Record Date there were outstanding 98,139,223 shares of common stock, par
value $0.01 per share, of CEC ("Shares"). Stockholders of record at the close of
business on the Record Date will be entitled to one vote at the Annual Meeting  
for each Share held on the Record Date.                                         

    As of March 28, 2006, the Nominees and their affiliates collectively may
be deemed to beneficially own an aggregate of 1,081,340 Shares, representing    
approximately 1.1% of the reported outstanding Shares. The Nominees and their   
affiliates intend to vote such Shares FOR the election of the Nominees.         

PLEASE VOTE FOR MESSRS. BOSTIC, COPELAND AND IDE BY RETURNING YOUR  
COMPLETED BLUE PROXY CARD TODAY.                                                

BACKGROUND                                                                      

   In 1995, Mr. Bostic founded the holding company that owned and operated
the American InterContinental University ("AIU"), an institution of higher      
education accredited by SACS consisting of seven branch campuses, and merged his
holdings in AIU with CEC in 2001. Mr. Bostic is currently the beneficial owner  
of 1,081,340 Shares, representing approximately 1.1% of the reported outstanding
Shares, which he received in connection with the merger of EduTrek              
International, Inc. ("EduTrek") with and into CEC. EduTrek was a holding company
that owned and operated the American InterContinental University ("AIU"). At the
time of the merger, AIU was fully accredited by SACS and had no pending         
regulatory probes.                                                              

  Since CEC has been run by the current management team, it has been the
subject of numerous investigations, sanctions, and lawsuits, which the Nominees 
believe have hurt CEC's student population and the Stockholders. In September of
2004, CEC announced that the DOJ was conducting an investigation concerning CEC,
which is ongoing. In June of 2005, the DOE notified CEC that it was reviewing   
CEC's consolidated financial statements and annual compliance audit opinions for
the years 2000 through 2003 and that it was initiating school program reviews at
certain of CEC's educational institutions. On December 6, 2005, the Commission  
on Colleges ("COC") of SACS placed AIU on probationary status for a period of   
twelve months for numerous violations of SACS' Principles of Accreditation,     
including regulations relating to "integrity". Probation applies to the entire  
institution, including all programs, branch campuses and off-campus sites as    
well as AIU's distance learning program. As stated in COC's Disclosure Statement
dated December 14, 2005, regarding the status of AIU, "probation is COC's most  
serious sanction, short of loss of membership, and is imposed on an institution 
for failure to correct deficiencies of significant non-compliance." In October  
of 2005, CEC's Texas Culinary Acadamy ("TCA") was reviewed by the Texas Higher  
Education Coordinating Board ("THECB") for compliance with certain Texas        
education laws, and TCA was given 90 days to perform remediation or risk losing 
degree-granting authority. CEC's Lehigh Valley College ("Lehigh Valley") is     
currently being reviewed by the Bureau of Consumer Protection of the Office of  
the Attorney General in Pennsylvania ("Pennsylvania AG"). The Pennsylvania AG   
has requested certain documents from Lehigh Valley, including information       
relating to Lehigh Valley's recruitment practices, student complaints, and      
financial aid policies and procedures, which CEC provided to the Pennsylvania AG
in August of 2005. The California Bureau for Private Postsecondary and          
Vocational Education ("BPPVE") has sought to place CEC's Brooks Institute for   
Photography ("BIP") on conditional approval to operate, which would result in,  
among other things, limitations on BIP's right to enroll students until BIP     
verifies and discloses certain placement information for each 2003 graduate,    
provides certain assurances about information to be described in manuals used   

-2- 

DEFC14A
4th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 4th
by admissions representatives and provides restitution to all students from May 
4, 1999 to present. In a press release dated March 16, 2006, CEC announced that 
a trial judge ruled that the BPPVE improperly issued BIP the Notice, and that   
the Notice is invalid. The California Department of Consumer Affairs, which     
oversees the BPPVE, notified BIP that it has not adopted the judge's ruling and 
has requested additional briefing before deciding whether to adopt, reject, or  
change the administrative law decision. In May of 2005, CEC's Sanford Brown     
Institute-Iselin ("SBI-Iselin") received a letter from the New Jersey Department
of Labor and Workforce Development ("DLWD") expressing concerns regarding       
allegations against SBI-Iselin reported in a 60 Minutes segment that aired on   
January 30, 2005 and requesting an explanation of the issues raised in the 60   
Minutes story and an argument that would convince the DLWD that SBI-Iselin      
should be allowed to continue to operate. SBI-Iselin submitted a formal written 
response to the DLWD in July 2005 and received verbal confirmation that they    
could proceed with SBI-Iselin's application submission in September 2005. In    
January 2006, SBI-Iselin submitted its license renewal application to DLWD for  
review and is awaiting a response. In addition, CEC and certain members of its  
senior management are the subject of numerous lawsuits brought by stockholders, 
current and former students, and employees. Disclosure regarding all of the     
foregoing investigations, inquiries and litigation can be found in greater      
detail in CEC's most recent Form 10-K for the fiscal year ending December 31,   
2005 and in CEC's other public filings with the SEC. Although it is difficult to
assign specific costs to these problems we know CEC is trading at a price to    
earnings ratio level substantially below many of its peers (see "Market         
Performace" below).                                                             

      In April of 2005, due to his concern about the numerous regulatory actions
and lawsuits confronting CEC, as well as the fact that CEC's Shares were trading
at a substantial discount to their peers in the education sector, Mr. Bostic    
submitted four stockholder proposals to be voted upon at CEC's 2005 annual      
meeting and solicited proxies from CEC's Stockholders in connection with those  
proposals. Mr. Bostic's proposals, intended to improve CEC's corporate          
governance, were to (1) withhold authority for each of CEC's three nominees for 
re-election to the Board, (2) declassify the Board, (3) grant Stockholders      
holding one-third of the outstanding Shares the right to call a meeting of      
Stockholders and (4) repeal CEC's stockholder rights plan, or "poison pill". Mr.
Bostic's proposals were publicly endorsed Institutional Shareholder Services    
("ISS") and Glass Lewis & Co. ("Glass Lewis"), two leading independent proxy    
advisory firms. In addition, a third leading independent proxy advisory firm,   
Proxy Governance Inc., recommended that Stockholders withhold their vote from   
CEC's three nominees and that Stockholders vote in favor of Mr. Bostic's        
proposal to grant Stockholders holding one-third of the outstanding Shares the  
right to call a meeting of Stockholders. In its report dated May 13, 2005       
prepared in response to the stockholder proposals submitted by Mr. Bostic in    
2005, Glass Lewis made the following statements:                                

      "For shareholders, the last eighteen months at Career Education has been a
  nightmare that most would love to forget, in our opinion. The stock is
  down more than 60%, the Company is under investigation by no less than
four federal agencies, the board and the Company are being sued in  
   securities class actions and employment lawsuits, some have accused key
 members of management of timing sales of stock suspiciously well, the
Company has been forced to restate three years of financials and key
accreditation bodies are threatening to pull credentials that are   
   essential to the Company continuing to do business. We are aware of few
 companies with as many bad marks... The Company and its schools judge
student performance every day; at the annual meeting, we believe    
  shareholders have their chance to turn the tables and declare that the
Company has abjectly failed its owners."                            

      None of the proxy advisory firms referenced above have, as of yet, taken a
position with regard to the matters to be voted upon at the Annual Meeting. In  
its annual report on the 2005 proxy season, ISS noted that at CEC's 2005 annual 
meeting, 69% of votes cast were withheld from CEC's three nominees. ISS further 
noted that this "withhold percentage appears to be the highest ever recorded."  
In spite of the overwhelming withhold vote against CEC's three nominees, all    
were elected to the Board. The Board accelerated the termination of CEC's       
shareholder rights plan, or "poison pill", which expired on August 15, 2005.    
Until faced with another proxy contest, CEC took the position that Mr. Bostic's 
remaining proposals were non-binding and took no action to implement them.      

Since the 2005 annual meeting, the problems afflicting CEC have not 
improved and appear to have worsened in light of AIU's probationary status.     
CEC's stock price continues to languish relative to the price to earnings ratio 
levels of its peers in the education sector (see "Market Performance"). In Mr.  
Bostic's view, CEC's recently announced amendments to its organizational        
documents do not go far enough toward implementing the                          

-3- 

DEFC14A
5th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 5th
corporate governance reforms that were proposed by Mr. Bostic and so strongly   
endorsed by CEC's Stockholders at the last annual meeting. Mr. Bostic believes  
that CEC's Board needs strong, independent advocates for shareholder rights and 
good corporate governance. In Mr. Bostic's view, the current Board has failed   
the Stockholders and change is urgently required. In addition, while the three  
current directors whose terms expire this year and who have been nominated by   
CEC for re-election at the 2006 annual meeting may technically satisfy the      
NASDAQ National Market's criteria for director independence, they have been     
selected by a Nominating and Governance Committee with ties to CEC's senior     
management. Thomas Lally, the Chairman of the Nominating and Governance         
Committee, is the former President of Heller Equity Capital Corporation, a      
venture capital firm that also formerly employed John Larson, CEC's President   
and Chief Executive Officer, as well as Patrick Pesch, CEC's Executive Vice     
President and Chief Financial Officer.                                          

      On February 8, 2006, Mr. Bostic sent a letter to Mr. Larson expressing his
disappointment with the failure by CEC's Board and management to expeditiously  
take the actions Mr. Bostic believes are necessary to restore CEC's damaged     
reputation, enhance the quality of educational standards and programs that are  
critical to CEC's success, and to address and resolve in a timely way the       
regulatory and operational problems weighing on CEC. In his letter, Mr. Bostic  
also requested a public response from CEC not later than February 13, 2006 to   
seven specific questions about CEC's plans for reforms to address its ongoing   
regulatory and operational problems. On February 8, 2006, CEC sent a letter to  
Mr. Bostic's counsel stating that CEC would not comment on the issues raised in 
the letter prior to CEC's earnings call, scheduled for February 15, 2006. On    
February 10, 2006, Mr. Bostic issued a press release announcing his intent to   
nominate an alternate slate of three directors for election to CEC's Board at   
the 2006 annual meeting, and on February 16, 2006 Mr. Bostic formally notified  
CEC of his intention to nominate Messrs. Copeland and Ide, in addition to       
himself, for election to the Board at CEC's 2006 annual meeting.                

MARKET PERFORMANCE                                                              

     CEC's stock price continues to languish relative to the price to earnings
ratio levels of its peers in the education sector. CEC's preliminary proxy      
statement filed on March 22, 2006 contains "an index of peer companies" which   
CEC has selected for the purposes of comparing cumulative total returns of CEC  
against the returns of such "peer companies". The "peer companies" selected by  
CEC are the following: Apollo Group Inc. ("APOL"), Corinthian Colleges, Inc.    
("COCO"), DeVry Inc. ("DV"), Education Management Corporation ("EDMC"), ITT     
Educational Services, Inc. ("ESI"), and Strayer Education, Inc. ("STRA"). We    
have set forth below a graph comparing CEC's price to earnings ratio to those of
the "peer companies" identified by CEC in its preliminary proxy statement.      

-4- 

DEFC14A
6th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 6th
CEC vs. Peer Group P/E Ratios (Quarterly) - Last 2 Years

[GRAPHIC OMITTED - Line Chart]

CEC                       APOL                        COCO                      
Date         Pe Ratio     Date           Pe Ratio     Date          Pe Ratio    
3/31/2004    42.2015      3/31/2004      55.5871      3/31/2004      37.5114    
6/30/2004    30.5772      6/30/2004      51.3314      6/30/2004       27.337    
9/30/2004    17.4417      9/30/2004      39.2353      9/30/2004      15.6744    
12/31/2004   21.8579      12/31/2004     40.1542      12/31/2004     22.1706    
3/31/2005    16.7122      3/31/2005        34.77      3/31/2005      18.7143    
6/30/2005    16.6409      6/30/2005      33.4274      6/30/2005      16.8026    
9/30/2005    15.2618      9/30/2005      26.8785      9/30/2005      19.5147    
12/30/2005   14.5095      12/30/2005     22.8937      12/30/2005     20.2931    
3/31/2006    16.2349      3/31/2006      18.8824      3/31/2006      24.8276    

DV                        EDMC                        ESI                       
Date         Pe Ratio     Date           Pe Ratio     Date           Pe Ratio   
3/31/2004    38.1646      3/31/2004      33.3298      3/31/2004       22.446    
6/30/2004     33.439      6/30/2004      31.9029      6/30/2004       24.529    
9/30/2004    30.4559      9/30/2004      24.6667      9/30/2004      20.8382    
12/31/2004   31.5636      12/31/2004     27.9661      12/31/2004     24.6373    
3/31/2005    36.3846      3/31/2005      21.5348      3/31/2005      23.8916    
6/30/2005    45.0226      6/30/2005      24.8398      6/30/2005      24.9626    
9/30/2005    37.9482      9/30/2005      22.5786      9/30/2005      21.8363    
12/30/2005   35.5872      12/30/2005     22.0766      12/30/2005     25.1532    
3/31/2006     40.516      3/31/2006      27.4063      3/31/2006      27.2553    

STRA                                                                            
Date         Pe Ratio                                                           
3/31/2004    50.1974                                                            
6/30/2004    44.9879                                                            
9/30/2004     44.751                                                            
12/31/2004   40.0693                                                            
3/31/2005    38.8082                                                            
6/30/2005    28.5629                                                            
9/30/2005    30.2949                                                            
12/30/2005   28.7423                                                            
3/31/2006    31.3681                                                            

Source: Bloomberg, April 19, 2006                       

Mr. Bostic believes that CEC's positive revenue and earnings growth over the    
last several years have been largely counterbalanced by the numerous problems in
which CEC has been embroiled, as evidenced by CEC's lower price to earnings     
ratio relative to its peers in the education sector. Mr. Bostic believes that   
until CEC has new leadership and a fresh approach to solving its problems, CEC's
price to earnings ratio will remain lower than its peers. No assurance can be   
given that the election of Mr. Bostic's nominees will result in any increase in 
CEC's price to earnings ratio.                                                  

WHY VOTE FOR MR. BOSTIC'S NOMINEES?                                             

    On December 6, 2005, COC of SACS placed AIU on probationary status for a
period of twelve months for fifteen violations of COC of SACS's Principles of   
Accreditation. Among other findings, COC of SACS determined CEC not to be in    
compliance with the "Prologue to Principles of Accreditation: (Integrity of     
student academic records and accuracy in recruiting and admission practices)."  
The portion of the Prologue to the Principles of Accreditation that discusses   
"integrity" states:                                                             

           "Integrity, essential to the purpose of higher education, functions
   as the basic contract defining the relationship between the
            Commission and each of its member institutions. It is a relationship
         in which all parties agree to deal honestly and openly with their
        constituencies and with one another. Without this commitment, no
         relationship can exist or be sustained between the Commission and
         its member institutions. The Commission's requirements, policies,
         processes, procedures, and decisions are predicated on integrity.
            The Commission on Colleges expects integrity to govern the operation
         of institutions. Therefore, evidence of intentionally withholding
         information, deliberately providing inaccurate information to the
            public, or failing to provide timely and accurate information to the
   Commission will be seen as the lack of a full commitment to
            integrity and may result in the loss of membership in the Commission
on Colleges."                                           

-5- 

DEFC14A
7th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 7th
  As described above under "Background", on February 8, 2006, Mr. Bostic
sent a letter to John Larson, CEC's President and Chief Executive Officer,      
requesting a public response from CEC not later than February 13, 2006 to seven 
specific questions about CEC's plans for reforms to address its ongoing         
regulatory and operational problems. CEC did not provide a response to any of   
these questions. On February 15, 2006, CEC held its quarterly earnings call for 
the fiscal year ended December 31, 2005. During the earnings call, CEC's        
management again did not take the opportunity to address any of the questions   
raised in Mr. Bostic's February 8, 2006 letter. In light of CEC's failure to    
respond to any of Mr. Bostic's questions or to otherwise publicly disclose a    
detailed plan for curing CEC's violations of the COC of SACS' Principles of     
Accreditation in the time allotted by the COC of SACS, we believe that it is    
legitimate for stockholders to question whether CEC's current management has a  
credible plan for preserving CEC's accreditation by SACS.                       

   We believe that the Nominees' qualifications and experience demonstrate
that they can bring to the Board the highest standards of integrity and a       
commitment to good corporate governance. From 1995 to 2001, Mr. Bostic was the  
Chairman and Chief Executive Officer of the holding company that owned AIU prior
to its acquisition by CEC. During that period, AIU was not cited for any        
violations of COC of SACS' Criteria for Accreditation, the predecessor to COC of
SACS' Principles of Accrediation. To Mr. Bostic's knowledge, from 1995 to 2001, 
AIU was not cited for, nor did it receive written notice of, non-compliance with
SACS criteria. Mr. Copeland is the former Chief Executive Officer of Deloitte & 
Touche LLP and Deloitte Touche Tohmatsu (collectively "Deloitte & Touche") and  
currently sits on the board of directors of three public companies. Since       
approximately June 2003, Mr. Copeland has been a Senior Fellow for Corporate    
Governance with the U.S. Chamber of Commerce. Mr. Ide is a partner of the law   
firm McKenna Long & Aldridge LLP ("MLA") and has represented public companies in
a number of turnaround and transition situations in a range of industries and   
market sectors, and he has experience addressing regulatory, competition,       
capital markets issues. Mr. Ide was Counselor to the United States Olympic      
Committee, for whom he oversaw the investigation of allegations of malfeasance  
during the bid for the Salt Lake City Games and the development and             
implementation of the Committee's correction strategies. Mr. Ide is also a      
former President of the American Bar Association.                               

    If elected, the Nominees intend to implement changes in CEC's management
policies to the extent necessary to ensure the following :                      

o That CEC's centrally administered quality control processes are   
streamlined and efficient;                                                      

   o That CEC's model for targeting and recruiting students results in the
admission of high-quality students;                                             

     o That CEC's curriculum development is at a level sufficient to result in
high student satisfaction and retention and a low level of bad debt write-offs; 

o That CEC adheres to "best practices" for management training and  
development in order to create high morale and minimize employee turnover; and  

o That CEC's tuition rates and annual increases are set at levels   
competitive with and comparable to peer institutions.                           

   We believe that the implementation of these measures would increase the
price to earnings ratio of CEC.                                                 

  The Nominees currently do not intend to propose that CEC enter into an
extraordinary transaction such as a merger, acquisition or sale of all CEC's    
assets. However, the Nominees would consider such a transaction, consistent with
their fiduciary duties, if such a transaction were proposed.                    

PARTICIPANTS IN SOLICITATION OF PROXIES                                         

  The Nominees are the sole participants in the solicitation of proxies.

-6- 

DEFC14A
8th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 8th
  Mr. Bostic is the beneficial owner of 456,970 Shares held in brokerage
accounts in his name. In addition, Mr. Bostic is the beneficial owner of 613,370
Shares held by the Robert Steven Bostic Revocable Trust, a Florida trust of     
which Mr. Bostic is the sole trustee. Mr. Bostic is also the beneficial owner of
11,000 Shares held by The Bostic Family Foundation, a charitable foundation     
administered by Mr. Bostic and members of his family. Other than these holdings,
neither Mr. Bostic nor any of his associates owns beneficially, directly or     
indirectly, any securities of CEC or of any parent or subsidiary of CEC. In     
aggregate, Mr. Bostic is the beneficial owner of 1,081,340 Shares, representing 
approximately 1.1% of the reported outstanding Shares. Neither Mr. Bostic nor   
his affiliates own beneficially, directory or indirectly, any additional        
securities of CEC or of any parent or subsidiary of CEC.                        

Neither Mr. Copeland, nor any of his associates owns beneficially,  
directly or indirectly, any securities of CEC or of any parent or subsidiary of 
CEC.                                                                            

     Neither Mr. Ide, nor any of his associates owns beneficially, directly or
indirectly, any securities of CEC or of any parent or subsidiary of CEC.        

    Information concerning Messrs. Bostic, Copeland and Ide, including their
ages and business backgrounds, may be found below under the heading "PROPOSAL 1:
ELECTION OF DIRECTORS." Mr. Bostic's business address is White Oaks Capital LLC,
1600 Frederica Road #10, St. Simons Island, Georgia 31522. Mr. Copeland's       
business address is 4359 Riverview Drive, Duluth, GA 30097. Mr. Ide's business  
address is McKenna Long & Aldridge LLP, 303 Peachtree St. NE, Ste. 5300,        
Atlanta, GA 30308.                                                              

OWNERSHIP OF NOMINEES                                                           

     The following table sets forth the number of Shares beneficially owned by
each of the Nominees.                                                           

                                                        [Enlarge/Download Table]

                                                                                            Percentage of     
                                                                Number of Shares             Outstanding      
                   Name and Address                            Beneficially Owned               Shares        
-------------------------------------------------------- ------------------------------- ---------------------
                                                                                                              
R. Steven Bostic                                                   1,081,340                           1.1%   

     White Oaks Capital LLC                                                                                   
     1600 Frederica Road #10                                                                                  
     St. Simons Island, Georgia 31522                                                                         

James E. Copeland, Jr.                                                     0                             0%   

     4359 Riverview Drive                                                                                     
     Duluth, GA 30097                                                                                         

R. William Ide                                                             0                             0%   

     McKenna Long & Aldridge LLP                                                                              
     303 Peachtree St. NE, Ste. 5300                                                                          
     Atlanta, GA  30308                                                                                       

  None of the Nominees may be deemed to be the beneficial owner (as that
term is defined in Rule 13d-3 under the Act) of more than 5% of the reported    
outstanding Shares.                                                             

  All transactions in the securities of CEC effected within the past two
years by the Nominees and their affiliates are contained in Appendix I attached 
hereto.                                                                         

OTHER INFORMATION                                                               

     Other than as disclosed in this Proxy Statement, none of the Nominees is,
or was within the past year, a party to any contract, arrangement or            
understanding with any person with respect to any securities of CEC, including, 
but not limited to, joint ventures, loan or option arrangements, puts or calls, 
guarantees against loss or guarantees of profit, division of losses or profits, 
or the giving or withholding of proxies.                                        

-7- 

DEFC14A
9th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 9th
None of the Nominees has any position or office with CEC.           

     Mr. Bostic has no arrangements or understandings with any person pursuant
to which he was selected to be a nominee.                                       

   Mr. Bostic has agreed to indemnify Messrs. Copeland and Ide against all
liabilities, costs and expenses (including reasonable legal fees and expenses)  
incurred by them in connection with any threatened, pending or completed claim, 
demand, action, suit or proceeding to which either Mr. Copeland or Mr. Ide is a 
party or threatened to be made a party by reason of Mr. Copeland's or Mr. Ide's 
nomination for election as a director of CEC, except for such liabilities,      
costs, and expenses arising from either Mr. Copeland's or Mr. Ide's fraud, gross
negligence, or willful misconduct.                                              

    Mr. Bostic has agreed with his fellow nominee, Mr. Copeland, that if Mr.
Bostic is elected as a director of CEC, Mr. Copeland will not, subject to his   
fiduciary duties, take any action in his capacity as director of CEC, nor vote  
in favor of any corporate action by CEC, that would result in Deloitte Touche   
being either advantaged or disadvantaged in competing for nonaudit services of  
CEC, so long as Mr. Copeland remains a director of CEC and Mr. Copeland's       
circumstances comply with the related fee limitations and other requirements    
related to the independence of directors as set forth by law or by applicable   
regulations, including those of NASDAQ, or by CEC's Board.                      

     Mr. Copeland has entered into a Memorandum of Understanding with Deloitte
& Touche that requires him as a retired Partner and Chief Executive Officer of  
Deloitte & Touche to obtain approval from the Chairman of the Board of Directors
of Deloitte & Touche for post-retirement activities, including membership on    
boards of directors. Mr. Copeland has received such approval to serve as a      
director of the Board, if elected. Mr. Copeland has no further arrangements or  
understandings with any other person pursuant to which he was selected to be a  
nominee. Mr. Copeland has agreed with Deloitte & Touche that he will not attempt
to sell Deloitte & Touche's services to any company for which he serves as a    
director, and that Mr. Copeland's compensation and duties as a consultant to    
Deloitte & Touche would not relate to or involve any services to any such       
company or its subsidiaries.                                                    

None of the Nominees nor any of their respective associates have any
further arrangement or understanding with any person with respect to (A) any    
future employment by CEC or its affiliates or (B) any future transactions to    
which CEC or any of its affiliates will or may be a party. None of the Nominees 
or their respective associates has a material interest in any transaction or    
series of transactions engaged in by CEC since the beginning of CEC's last      
fiscal year. However, Mr. Bostic sent a letter to CEC requesting reimbursement  
for expenses incurred by him during his proxy solicitation for the 2005 annual  
meeting of Stockholders. None of the Nominees during the past ten years has been
convicted in a criminal proceeding (excluding traffic violations or similar     
misdemeanors).                                                                  

   None of the entities referred to in this Proxy Statement with which the
Nominees have been involved during the past five years is a parent, subsidiary, 
or other affiliate of CEC.                                                      

PROPOSAL 1:  ELECTION OF DIRECTORS                                              

     The Nominees propose that the Stockholders elect Messrs. Bostic, Copeland
and Ide as directors of CEC at the Annual Meeting. There can be no assurance as 
to whether any of CEC's current directors or nominees, if elected, would serve  
with any of the Nominees if one or more of the Nominees is elected. In the event
that one or more of the Nominees is elected and that one or more of CEC's       
current directors or nominees declines to serve with such Nominee or Nominees,  
CEC's Amended and Restated Certificate of Incorporation (the "Certificate")     
provides that director vacancies may be filled by the directors then in office. 

    Background information about the Nominees is set forth below. Other than
the indemnification arrangements described above under the heading "Other       
Information". The Nominees are not receiving any compensation from any of the   
Nominees or any of their affiliates in connection with this proxy solicitation. 
If elected by the Stockholders at the Annual Meeting, it is expected that a     
Nominee could receive compensation similar to the compensation received by the  
other independent directors of CEC.                                             

      ROBERT STEVEN BOSTIC, age 62. Since September 2005, Mr. Bostic's principal
occupation is Chairman of White Oaks Capital LLC ("WOC"). WOC's principal       
business is the ownership of Live Oaks                                          

-8- 

DEFC14A
10th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 10th
Development LLC ("LOD"), First ArtWorks and the Island Design and Architectural 
Center ("IDAC"), and its principal business address is 1600 Frederica Road #10, 
St. Simons Island, Georgia 31522. Since August 2004, Mr. Bostic has served as   
Chairman of LOD. LOD's principal business is real estate development. Since     
August 2005, Mr. Bostic has served as Chairman of First ArtWorks. First         
ArtWorks' principal business is promoting and funding the arts in the K-8 school
market. Since May 2005, Mr. Bostic has served as Chairman of IDAC. IDAC's       
principal business is as a design center. From 1995 until January 2001, Mr.     
Bostic was the Chairman and Chief Executive Officer of EduTrek, a holding       
company that owned and operated AIU, an institution of higher education         
consisting of seven accredited universities. In January 2001, EduTrek was merged
with and into CEC. Commencing in January 2001, Mr. Bostic was retired, until he 
assumed the position of Chairman of LOD in August 2004.                         

   JAMES E. COPELAND, Jr., age 61. Mr. Copeland is retired. From June 1999
until his retirement in May 2003, Mr. Copeland served as a Partner and Chief    
Executive Officer of Deloitte & Touche. Deloitte & Touche's principal business  
is the provision of professional services. Mr. Copeland continues to provide    
consulting services to Deloitte & Touche on an "as needed" basis. His principal 
residence and place of business is 4359 Riverview Drive, Duluth, GA 30097. Mr.  
Copeland serves as a member of the Board of Directors of Coca-Cola Enterprises  
Inc. ("CCE"). CCE's principal business is beverage bottling and distribution.   
Mr. Copeland also serves as chair of CCE's compensation committee and as a      
member of CCE's audit, nominating/corporate governance and affiliated           
transaction committees. Mr. Copeland serves as a member of the Board of         
Directors of ConocoPhillips ("COP"). COP's principal business is the production 
and distribution of petroleum. Mr. Copeland also serves on COP's audit          
committee. Mr. Copeland serves as a member of the Board of Directors of Equifax 
Inc. ("EFX"). EFX's principal business is the compilation and sale of credit    
information. Mr. Copeland also serves as the chair of EFX's audit committee.    
Since June 2003, Mr. Copeland has been a part-time Global Scholar at Georgia    
State University's J. Mack Robison College of Business. Since approximately June
2003, Mr. Copeland has been a Senior Fellow for Corporate Governance with the   
U.S. Chamber of Commerce.                                                       

      R. WILLIAM IDE, age 65. Since January 2003, Mr. Ide's principal occupation
is Partner at the law firm MLA. MLA's principal business is the provision of    
legal services, and its principal place of business is 303 Peachtree St. NE,    
Ste. 5300, Atlanta, GA 30308. Mr. Ide serves as a member of the Board of        
Directors of AFC Enterprises ("AFC"). AFC's principal business is as a          
franchisor and operator of Popeyes(R) Chicken & Biscuits restaurants. Mr. Ide   
also serves as chair of AFC's nominating/corporate governance committee and as a
member of its executive and audit committees. Mr. Ide serves as a member of the 
Board of Directors of Albemarle Corporation ("AC"). AC's principal business is  
chemical production. Mr. Ide also serves on AC's audit and nominating/corporate 
governance committees. From July 2002 to January 2003 Mr. Ide's principal       
occupation was Counsel to MLA. From July 2001 to July 2002, Mr. Ide's principal 
occupation was as an attorney at law in private practice. From November 1996 to 
June 2001, Mr. Ide served as Senior Vice-President, General Counsel and         
Secretary of Monsanto Company ("MS"). MS's principal business is the provision  
of agricultural products to farmers.                                            

     WE STRONGLY URGE YOU TO VOTE FOR THE ELECTION OF MESSRS. BOSTIC, COPELAND
AND IDE BY SIGNING, DATING AND RETURNING THE ENCLOSED BLUE PROXY CARD IN THE    
POSTAGE PAID ENVELOPE PROVIDED TO YOU WITH THIS PROXY STATEMENT. IF YOU HAVE    
SIGNED THE BLUE PROXY CARD AND NO MARKING IS MADE, YOU WILL BE DEEMED TO HAVE   
GIVEN A DIRECTION TO VOTE ALL THE SHARES REPRESENTED BY THE BLUE PROXY CARD FOR 
THE ELECTION OF MESSRS. BOSTIC, COPELAND AND IDE.                               

     Except as set forth herein, none of the Nominees: (i) owns any securities
of CEC of record but not beneficially; (ii) owns beneficially any securities of 
CEC or any parent or subsidiary of CEC; (iii) has any agreement or understanding
with any person with respect to any future employment by CEC or its affiliates; 
(iv) has any agreement or understanding with any person with respect to any     
future transactions to which CEC or any of its affiliates will or may be a      
party; (v) has engaged in or had a direct or indirect interest in any           
transaction, or series of similar transactions, since the beginning of CEC's    
last fiscal year, or any currently proposed transaction, or series of similar   
transactions, to which CEC or any of its subsidiaries was or is to be a party,  
in which the amount involved exceeds $60,000; (vi) borrowed any funds for the   
purpose of acquiring or holding any securities of CEC; (vii) is presently, or   
has been within the past year, a party to any contract, arrangement or          
understanding with any person with respect to securities of CEC; or (viii) will 
receive any special compensation in connection with the proxy                   

-9- 

DEFC14A
11th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 11th
solicitation. Other than as disclosed in this Proxy Statement, no securities of 
CEC are beneficially owned by any of the associates of the Nominees.            

OTHER PROPOSALS                                                                 

PROPOSAL 2: PROPOSAL TO DECLASSIFY THE BOARD                        

    According to the CEC Preliminary Proxy Statement, at the Annual Meeting,
CEC intends to seek Stockholder approval to amend the Certificate to declassify 
the Board. The proposed amendment provides that beginning at the Annual Meeting,
those directors previously elected for three-year terms of office will, upon the
expiration of their three-year terms, be eligible for re-election by the        
Stockholders to one-year terms such that beginning at CEC's 2008 annual meeting 
of Stockholders, all directors would be subject to annual election to one-year  
terms.                                                                          

     Mr. Bostic believes that an immediate, full declassification of the Board
would be preferable to the gradual declassification of the Board proposed by    
CEC. CEC's proposal would not result in the full declassification of the Board  
until the 2008 annual meeting of the Stockholders. An immediate, full           
declassification of the Board would, in Mr. Bostic's view, make CEC's directors 
more accountable to the Stockholders by affording them the opportunity to vote  
on the election of each director annually, not just once every three years. At  
CEC's 2005 annual meeting, Stockholders voted 65.5% of the outstanding Shares in
favor of Mr. Bostic's proposal for the full declassification of the Board.      
However, while Mr. Bostic believes that Proposal 1 does not go far enough to    
make the Board accountable to Stockholders, he believes that it is preferable to
retaining a fully staggered Board and accordingly, he recommends that           
Stockholders vote FOR the Board's proposal to amend the certificate to          
declassify the Board. Each of the Nominees has indicated that if elected they   
will propose to accelerate the declassification of the Board.                   

      The below description is based on the description of Proposal 2 in the CEC
Preliminary Proxy Statement.                                                    

PROPOSED AMENDMENT TO CERTIFICATE TO DECLASSIFY THE BOARD           

Article V of the Certificate currently divides the Board into three 
classes. Directors are elected for three-year terms that are staggered among the
three classes. If this proposal is approved by Stockholders, the Certificate    
will be amended to provide that those directors previously elected for          
three-year terms of office by the Stockholders will complete their three-year   
terms and would be eligible for re-election to one-year terms at each annual    
meeting of Stockholders thereafter. Beginning with the 2008 annual meeting of   
Stockholders, the declassification of the Board would be complete, and all      
directors would be subject to annual election to one-year terms.                

The Board has also approved conforming amendments to its By-laws    
contingent upon approval by the Stockholders of the proposed amendment to the   
Certificate to declassify the Board. Article III, Section 3.3 of the By-laws    
currently provides that the CEC's directors may only be removed for cause. If   
the proposal to declassify the Board is approved, Article III, Section 3.3 of   
the By-laws will be amended to provide that any director or the entire Board,   
excepting certain Continuing Classified Directors (as defined in Article V of   
the proposed Restated Certificate of Incorporation), may be removed from office 
at any time by the affirmative vote of the holders of a majority of the voting  
power of the shares entitled to vote at an election of directors. The Third     
Amended and Restated By-laws amending Article III, Section 3.3 of the By-laws,  
will become effective simultaneously with the effective date of the filing of   
the Restated Certificate of Incorporation providing for a declassified Board    
with the Secretary of State of the State of Delaware.                           

      The proposed Restated Certificate of Incorporation, including the proposed
amendment to Article V of the Certificate to declassify the Board is attached to
the CEC Preliminary Proxy Statement as Exhibit A, and the above discussion is   
qualified in its entirety by reference to such exhibit.                         

We recommend that you vote FOR the Board's proposal to amend the    
Certificate to declassify the Board.                                            

PROPOSAL 3: PROPOSAL TO PERMIT STOCKHOLDERS TO CALL SPECIAL MEETINGS
OF STOCKHOLDERS                                                                 

-10-

DEFC14A
12th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 12th
 According to the CEC Preliminary Proxy Statement, CEC intends to seek
Stockholder approval to amend CEC's Certificate to permit Stockholders holding  
at least sixty-six and two-thirds percent (66 2/3%) of the voting power of the  
Shares to call special meetings of Stockholders.                                

 Mr. Bostic believes that the Stockholders would be better served by a
provision permitting Stockholders holding at least thirty-three and one-third   
percent (33 1/3%) of the outstanding Shares to call special meetings of         
Stockholders, as was proposed by Mr. Bostic at CEC's 2005 annual meeting and as 
was endorsed by votes of 64.2% of the outstanding Shares. In Mr. Bostic's view, 
a threshold of sixty-six and two-thirds percent (66 2/3%) of the outstanding    
Shares sets the bar for calling a special meeting of Stockholders at an         
unreasonably high level, especially given that it is substantially higher than  
the majority threshold that would be required to get many significant matters   
approved at a special meeting of the Stockholders. Mr. Bostic disagrees with the
Board's assertion in the CEC Preliminary Proxy Statement that a threshold of    
thirty-three and one-third percent (33 1/3%) of the outstanding Shares to call a
special meeting of Stockholders would result in disruption to the business of   
CEC and impose significant administrative and financial burdens on CEC. Rather, 
Mr. Bostic believes that meeting this threshold would require the consensus of a
very substantial block of CEC's Stockholders, and that, this high threshold     
having been met, Stockholders could only benefit from being permitted a forum in
which to bring their concerns before the Company. While Mr. Bostic does not     
fully support Proposal 3 for the reasons described above, he believes that it is
preferable to the current provisions of the Certificate which deny the          
Stockholders any ability to call a special meeting, and accordingly, he         
recommends that Stockholders vote FOR the Board's proposal to amend the         
Certificate to permit Stockholders holding at least sixty-six and two-thirds    
percent (66 2/3%) of the voting power of the Shares to call special meetings of 
the Stockholders. Each of the Nominees has indicated that if elected they will  
propose to reduce the threshold to thirty-three and one-third percent (33 1/3%).

      The below description is based on the description of Proposal 3 in the CEC
Preliminary Proxy Statement.                                                    

    PROPOSED AMENDMENT TO CERTIFICATE TO PERMIT STOCKHOLDERS TO CALL SPECIAL
MEETINGS OF STOCKHOLDERS.                                                       

     Article VI of the Certificate currently provides that special meetings of
Stockholders may only be called pursuant to a resolution approved by a majority 
of the Board. If this proposal is approved by Stockholders, Article VI will be  
amended to allow Stockholders holding at least sixty-six and two-thirds percent 
(66 2/3%) of the voting power of the Shares entitled to vote at an election of  
directors to call a special meeting of stockholders.                            

The Board has also approved conforming amendments to the By-laws    
contingent upon approval by the Stockholders of the proposed amendment to the   
Certificate to permit Stockholders holding at least sixty-six and two-thirds    
percent (66 2/3%) of the voting power of the Shares to call special meetings of 
Stockholders. Article II, Section 2.6 of the By-laws currently provides that    
special meetings of stockholders may be called only by the Board. If this       
proposal is approved, Article II, Section 2.6 of the By-laws will allow         
Stockholders holding at least sixty-six and two-thirds percent (66 2/3%) of the 
voting power of the Shares entitled to vote at an election of directors to call 
a special meeting of Stockholders, subject to certain specified conditions. The 
Third Amended and Restated By-laws amending Article II, Section 2.6 of the      
By-laws, will become effective simultaneously with the effective date of the    
filing of the Restated Certificate of Incorporation permitting the holders of at
least sixty-six and two-thirds percent (66 2/3%) of the voting power of shares  
of Common Stock to call special meetings of stockholders with the Secretary of  
State of the State of Delaware.                                                 

      The proposed Restated Certificate of Incorporation, including the proposed
amendment to Article VI of the Certificate to permit the Stockholders holding at
least sixty-six and two-thirds percent (66 2/3%) of the voting power of the     
Shares to call special meetings of stockholders, is attached to the CEC         
Preliminary Proxy Statement as Exhibit A, and the above discussion is qualified 
in its entirety by reference to such exhibit.                                   

IMPACT OF THE PROPOSAL ON THE FILLING OF VACANCIES BY THE BOARD     

    All vacancies on the Board and newly-created directorships will continue
to be filled by the Board. Any director elected to fill a vacancy not resulting 
from an increase in the number of directors will hold office for the same       
remaining term as that of his or her predecessor and until his or her successor 
is elected and qualified.                                                       

-11-

DEFC14A
13th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 13th
   We recommend that you vote FOR the proposal to amend the Certificate to
permit the Stockholders holding at least sixty-six and two-thirds percent (66   
2/3%) of the voting power of the Shares of Common Stock entitled to vote at an  
election of directors to call special meetings of Stockholders.                 

PROPOSAL 4: RATIFICATION OF APPOINTMENT OF AUDITORS                 

The Audit Committee of the Board has appointed Ernst & Young LLP,   
independent certified public accountants, to serve as independent auditors of   
CEC for the year ending December 31, 2006. This firm has audited the accounts of
CEC since 2002.                                                                 

   Stockholder ratification of the selection of Ernst & Young LLP as CEC's
independent auditors is not required by CEC's By-Laws or otherwise. However,    
according to the CEC Preliminary Proxy Statements, the Board is submitting to   
the stockholders at the Annual Meeting a proposal to ratify the Board'          
appointment of Ernst & Young LLP. According to the CEC Preliminary Proxy        
Statement, if a majority of the Shares voted at the Annual Meeting, in person or
by proxy, are not voted in favor of the ratification of the appointment of Ernst
& Young LLP, the Audit Committee will consider the facts and circumstances      
surrounding the vote and may reconsider such appointment. According to the CEC  
Preliminary Proxy Statement, notwithstanding this selection and the ratification
of this selection by Stockholders, the Audit Committee, in its discretion, may  
direct the appointment of a different independent accounting firm at any time   
during the year if the Audit Committee determines that such a change would be in
the best interests of CEC and its stockholders.                                 

 According to the CEC Preliminary Proxy Statement, it is expected that
representatives of Ernst & Young LLP will be present at the meeting and will be 
available to respond to questions. They will be given an opportunity to make a  
statement if they desire to do so.                                              

 We recommend that you vote FOR the ratification of the appointment of
Ernst & Young LLP as the independent auditors of CEC's financial statements for 
the year ending December 31, 2006.                                              

      IF YOU HAVE SIGNED THE BLUE PROXY CARD AND NO MARKING IS MADE, YOU WILL BE
DEEMED TO HAVE GIVEN A DIRECTION TO VOTE ALL THE SHARES REPRESENTED BY THE BLUE 
PROXY CARD FOR THE FOREGOING PROPOSALS.                                         

VOTING ON OTHER PROPOSALS                                                       

  The accompanying BLUE Proxy Card will be voted in accordance with your
instruction on such card. You may vote for or vote against, or abstain from     
voting on, the proposals described above under the heading "Other Proposals" by 
marking the proper box on the BLUE Proxy Card.                                  

The Nominees and their affiliates know of no other business to be   
presented at the Annual Meeting. If any other matters should properly come      
before the Annual Meeting, it is intended that the persons named on the enclosed
BLUE Proxy Card will vote that proxy on such other matters in accordance with   
their judgment. The Nominees will not use such discretionary authority to vote  
the proxies for matters of which the Nominees are aware a reasonable time before
the Annual Meeting.                                                             

VOTING PROCEDURES                                                               

   According to the CEC Preliminary Proxy Statement, the voting procedures
for the Annual Meeting are as set forth below. The required quorum for          
transaction of business at the Annual Meeting will be a majority of the Shares  
as of the Record Date. Votes cast by proxy or in person at the Annual Meeting   
will be tabulated by the election inspector appointed for the meeting and will  
determine whether or not a quorum is present.                                   

      Stockholders as of the close of business on the Record Date ("Stockholders
of Record") are entitled to receive notice of, and to vote at, the Annual       
Meeting or any adjournments thereof. If you do not hold your Shares through a   
brokerage firm, bank nominee or other institution, then you are a Stockholder of
Record and you may vote using any of the following methods:                     

-12-

DEFC14A
14th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 14th
     By Mail: Complete, sign and date the BLUE Proxy Card and return it in the
prepaid envelope. Each executed and returned BLUE Proxy Card or voting          
instruction card will be voted in accordance with the directions indicated      
thereon, or if no direction is indicated, such proxy will be voted in accordance
with the recommendations of the Nominees contained in this Proxy Statement. If  
you are a stockholder of record, and the prepaid envelope is missing, please    
mail your completed proxy card to Messrs. Bostic, Copeland and Ide c/o Innisfree
M&A Incorporated, 501 Madison Avenue - 20th Floor, New York, NY 10022.          

      In person at the Annual Meeting: If you attend the Annual Meeting, you may
deliver your completed BLUE Proxy Card in person, or you may vote in person. If 
you hold your shares in a stock brokerage account or by a bank or other holder  
of record, you will not be able to vote in person at the Annual Meeting unless  
you have previously requested and obtained a "legal proxy" from your bank,      
broker or other nominee and present it at the Annual Meeting.                   

    If your Shares are held in the name of a brokerage firm, bank nominee or
other institution, only it can vote such shares and only upon receipt of your   
specific instructions. Accordingly, you should contact the person responsible   
for your account and give instructions for a BLUE Proxy Card to be signed       
representing your shares.                                                       

    Your vote is important. Whether or not you are able to attend the Annual
Meeting, we urge you to complete the enclosed BLUE Proxy Card and return it in  
the enclosed self-addressed pre-paid envelope. All valid proxies received prior 
to the meeting will be voted. If you specify a choice with respect to any item  
by marking the appropriate box on the proxy, the Shares will be voted in        
accordance with that specification. IF NO SPECIFICATION IS MADE, THE PERSONS    
NAMED ON THE ENCLOSED BLUE PROXY CARD WILL VOTE YOUR SHARES FOR MESSRS. BOSTIC, 
COPELAND AND IDE WITH RESPECT TO PROPOSAL 1, AND FOR PROPOSAL 2, FOR PROPOSAL 3 
AND FOR PROPOSAL 4.                                                             

PROXY PROCEDURES                                                                

    WE  STRONGLY  URGE  YOU TO VOTE  FOR THE  ELECTION  OF  MESSRS.  BOSTIC,
COPELAND  AND IDE. IF YOU WISH TO DO SO,  PLEASE MARK,  SIGN,  DATE AND RETURN  
THE ENCLOSED BLUE PROXY CARD IN THE ENCLOSED POSTAGE-PREPAID ENVELOPE.          

    If you have any questions about giving your proxy or require assistance,
please call:                                                                    

INNISFREE M&A INCORPORATED

 501 Madison Avenue - 20th Floor
New York, NY 10022
 Stockholders Call Toll-Free: 1-877-750-9499
 Banks or Brokers Call Collect: 1-212-750-5833

   The accompanying BLUE Proxy Card will be voted at the Annual Meeting in
accordance with your instructions on such card.                                 

REVOCATION OF PROXIES                                                           

  Any Stockholder who has mailed a WHITE Proxy Card to CEC may revoke it
before it is voted by mailing a duly executed proxy card to the Nominees bearing
a date LATER than the proxy card delivered to CEC. Proxies may also be revoked  
at any time prior to voting by: (i) delivering to CEC (Attention: Janice L.     
Block, Senior Vice President, General Counsel and Secretary) a written notice   
stating that the proxy is revoked; (ii) delivering a duly executed proxy bearing
a later date than the proxy delivered previously; or (iii) attending the Annual 
Meeting and voting in person.                                                   

Only Stockholders of Record will be entitled to vote. If you were a 
Stockholder of Record, you will retain your voting rights at the Annual Meeting 
even if you sell such Shares after the Record Date. Accordingly, it is important
that you vote the Shares held by you on the Record Date, or grant a proxy to    
vote such Shares on the BLUE Proxy Card, even if you sell such Shares after the 
Record Date.                                                                    

-13-

DEFC14A
15th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 15th
IF YOUR SHARES ARE HELD IN THE NAME OF A BROKERAGE FIRM, BANK, BANK 
NOMINEE OR OTHER INSTITUTION ON THE RECORD DATE, ONLY IT CAN VOTE SUCH SHARES   
AND ONLY UPON RECEIPT OF YOUR SPECIFIC INSTRUCTIONS. ACCORDINGLY, PLEASE CONTACT
THE PERSON RESPONSIBLE FOR YOUR ACCOUNT AND INSTRUCT THAT PERSON TO EXECUTE ON  
YOUR BEHALF THE BLUE PROXY CARD AS SOON AS POSSIBLE.                            

SOLICITATION OF PROXIES                                                         

  Mr. Bostic and the other Nominees may solicit proxies. Proxies will be
solicited by mail, advertisement, telephone, facsimile, other electronic means  
and in person. None of those persons will receive additional compensation for   
their solicitation efforts.                                                     

In addition, Mr. Bostic has retained Innisfree M&A Incorporated     
("Innisfree") to assist in this proxy solicitation, for which services Innisfree
will be paid a fee not to exceed $150,000. Innisfree will also be reimbursed for
its reasonable out-of-pocket expenses. Mr. Bostic has also agreed to indemnify  
Innisfree against certain liabilities and expenses, including certain           
liabilities and expenses under the federal securities laws. It is anticipated   
that 75 persons will be employed by Innisfree to solicit Stockholders.          

     Banks, brokers, custodians, nominees and fiduciaries will be requested to
forward solicitation material to beneficial owners of Shares. Mr. Bostic will   
reimburse banks, brokers, custodians, nominees and fiduciaries for their        
reasonable expenses for sending solicitation material to beneficial owners.     

     Mr. Bostic's estimate of the total cost to be incurred in connection with
this proxy solicitation is between $1,000,000 and $1,500,000. To date,          
approximately $500,000 has been incurred in connection with this proxy          
solicitation. Mr. Bostic will bear the costs of this proxy solicitation and, if 
successful, will seek reimbursement of the costs from CEC. The affirmative vote 
of the directors other than Mr. Bostic's Nominees would be required to approve  
such reimbursement. The Board would be informed of Mr. Bostic's interest in     
receiving reimbursement and would be required to evaluate the requested         
reimbursement consistent with their fiduciary duties to CEC and its             
Stockholders. Costs related to the solicitation of proxies include expenditures 
for attorneys, public relations, printing, advertising, postage, and related    
expenses and fees.                                                              

ADDITIONAL INFORMATION                                                          

Certain information regarding the securities of CEC held by CEC's   
directors, nominees, management and Stockholders holding 5% or more of the      
outstanding Shares is contained in the CEC Preliminary Proxy Statement.         
Information concerning the date by which proposals of Stockholders intended to  
be presented at the Annual Meeting must be received by CEC for inclusion in the 
2006 Proxy Statement and form of proxy for the Annual Meeting is contained in   
CEC's Proxy Statement for CEC's 2005 annual meeting of Stockholders. This       
information is contained in CEC's public filings. The Nominees assume no        
responsibility for the accuracy or completeness of such information.            

 [remainder of page intentionally blank]

-14-

DEFC14A
16th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 16th
Date: April 19, 2006                                                            

                      /s/ Robert Steven Bostic
                                       -----------------------------------------
                  Robert Steven Bostic

                        /s/ James E. Copeland, Jr.
                                       -----------------------------------------
                    James E. Copeland, Jr.

                /s/ R. William Ide
                                       -----------------------------------------
            R. William Ide

DEFC14A
17th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 17th
APPENDIX I

SUPPLEMENTAL INFORMATION

     Set forth below are the dates and amounts of each Nominee's purchases and
sales of Shares within the past two years.                                      

                                                        [Enlarge/Download Table]

--------------------------------------------------------------------------------------------------
                                                                       Transaction        Number  
                              Name                       Date             Type           of Shares
--------------------------------------------------------------------------------------------------
                                                                                                  
R. Steven Bostic                                       08/11/04        Sell Shares        300,000 

James E. Copeland, Jr.                                                    None                    

R. William Ide                                                            None                    
--------------------------------------------------------------------------------------------------

I-1 

DEFC14A
18th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 18th
IMPORTANT                                                                       

1. If your shares are held in your own name, please mark, date and mail the     
  enclosed BLUE Proxy Card to our Proxy Solicitor, Innisfree M&A Incorporated,
501 Madison Avenue - 20th Floor, New York, NY 10022, in the postage-paid  
envelope provided.                                                        

2. If your shares are held in the name of a brokerage firm, bank nominee or     
   other institution, only it can vote such shares and only upon receipt of your
   specific instructions. Accordingly, you should contact the person responsible
for your account and give instructions for a BLUE Proxy Card to be signed 
representing your shares.                                                 

  If you have already submitted a WHITE Proxy Card to CEC for the Annual
Meeting, you may change your vote to a vote FOR the election of the Nominees by 
marking, signing, dating and returning the enclosed BLUE Proxy Card for the     
Annual Meeting, which must be dated after any proxy you may have submitted to   
CEC. ONLY YOUR LATEST DATED DULY EXECUTED PROXY FOR THE ANNUAL MEETING WILL     
COUNT AT THE ANNUAL MEETING. Proxies may also be revoked at any time prior to   
voting by: (i) delivering to CEC (Attention: Janice L. Block, Senior Vice       
President, General Counsel and Secretary) a written notice stating that the     
proxy is revoked; (ii) delivering a duly executed proxy bearing a later date    
than the proxy delivered previously; or (iii) attending the Annual Meeting and  
voting in person.                                                               

3. If you have any questions about giving your proxy or require assistance,     
please call:                                                              

INNISFREE M&A INCORPORATED

 501 Madison Avenue - 20th Floor
New York, NY 10022
 Stockholders Call Toll-Free: 1-877-750-9499
 Banks or Brokers Call Collect: 1-212-750-5833

DEFC14A
19th Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 19th
PROXY CARD

CAREER EDUCATION CORPORATION
ANNUAL MEETING OF STOCKHOLDERS

THIS PROXY IS SOLICITED BY
R. STEVEN BOSTIC

The undersigned hereby appoints Messrs. R. Steven Bostic, James E. Copeland, Jr.
and R. William Ide and each of them, as proxies, with full power of             
substitution, to vote the stock of Career Education Corporation ("CEC") which   
the undersigned may be entitled to vote at the Annual Meeting of Stockholders or
at any adjournment or postponements thereof, upon the matters set forth in the  
Proxy Statement of Mr. Bostic and upon such other matters as may properly come  
before the meeting, and revokes any previous proxies with respect to the matters
covered by this proxy. IF NO DIRECTION IS MADE WITH RESPECT TO A PROPOSAL, THIS 
PROXY WILL BE VOTED OR INSTRUCTIONS WILL BE GIVEN AS FOLLOWS WITH RESPECT TO ANY
SUCH PROPOSAL: (i) FOR MESSRS. R. STEVEN BOSTIC, JAMES E. COPELAND, JR. AND R.  
WILLIAM IDE FOR DIRECTORS, (ii) FOR THE PROPOSAL TO DECLASSIFY THE BOARD, (iii) 
FOR THE PROPOSAL TO PERMIT STOCKHOLDERS TO CALL SPECIAL MEETINGS OF STOCKHOLDERS
AND (iv) FOR THE RATIFICATION OF APPOINTMENT OF AUDITORS. THIS PROXY WILL ALSO  
BE VOTED AT THE DISCRETION OF THE PROXY HOLDERS UPON SUCH OTHER BUSINESS AS MAY 
PROPERLY COME BEFORE THE MEETING. If one or more of Mr. Bostic's nominees for   
director is unable or declines to serve as director, this proxy will be voted   
for any nominee that Mr. Bostic designates.                                     

Please complete, sign and date the reverse side of this proxy card and return it
in the enclosed envelope.                                                       

YOUR VOTE IS VERY IMPORTANT TO US.                                              

(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)

DEFC14A
Last Page of 20
TOC
1st
Previous
Next
↓Bottom
Just 20th
|X| Please mark votes as in this example.                                       

This proxy when properly executed will be voted in the manner directed herein by
the undersigned stockholder.                                                    

WE RECOMMEND A VOTE "FOR" THE ELECTION OF THE NOMINEES LISTED IN PROPOSAL 1     
BELOW.                                                                          

1. Election of Directors - Nominees:                                            

--------------------------------------------------------------------------------

Nominee                                                                         
-----------------------------------------                                       
(01) R. Steven Bostic                                                           
-----------------------------------------        FOR               WITHHOLD     
(02) James E. Copeland, Jr.                      all               from all     
-----------------------------------------      nominees            nominees     
(03) R. William Ide                              [ ]                 [ ]        
-----------------------------------------                                       

--------------------------------------------------------------------------------
Instruction: To withhold authority                                              
for individual nominee(s), print name(s): ______________________________________

--------------------------------------------------------------------------------

     We intend to use this proxy to vote FOR Messrs. Bostic, Copeland and Ide.

    There is no assurance that any of CEC's nominees will serve as directors
if Messrs. Bostic, Copeland or Ide is elected to the Board of Directors. In the 
event that one or more of Mr. Bostic's nominees is elected and that one or more 
of the CEC nominees declines to serve with such nominee or nominees, then the   
Second Amended and Restated By-laws of CEC provide that director vacancies may  
be filled by a majority vote of the directors then in office.                   

WE RECOMMEND A VOTE "FOR" PROPOSALS 2, 3 AND 4  BELOW               

--------------------------------------------------------------------------------
                                         FOR         AGAINST       Abstain

--------------------------------------------------------------------------------
                                       [ ]           [ ]           [ ]
2.  Proposal to Declassify the Board                                            
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
                                       [ ]           [ ]           [ ]
3. Proposal to Permit Stockholders to                                           
call Special Meetings of Stockholders                                           
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
                                       [ ]           [ ]           [ ]

4. Ratification of Appointment of Auditors                                      
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Dated                                                                           
--------------------------------------------------------------------------------

Signature(s)                                                                    
--------------------------------------------------------------------------------

Signature(s)                                                                    
--------------------------------------------------------------------------------

    Note: Please sign exactly as name appears hereon. If the Shares are held
      by joint tenants or as community property, both must sign. When signing as
      executor, administrator, trustee or other representative, please give full
 title. If a corporation, please sign in full corporate name by a duly
    authorized officer. If a partnership, please sign in partnership name by
an authorized person.                                               

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘DEFC14A’ Filing		Date		First		Last			Other Filings
		12/31/06		13					10-K
		5/18/06		2					3,  4,  8-K,  PRE 14A,  PREN14A
Filed on / Effective on:		4/19/06		2		16			DEFA14A,  PRRN14A
		4/5/06		3					8-K,  PREC14A
		3/28/06		3					PREN14A
		3/22/06		5					PRE 14A
		3/21/06		3
		3/16/06		4					8-K
		2/16/06		5					8-K
		2/15/06		5		7			8-K,  8-K/A,  SC 13G/A
		2/13/06		5		7			DEFA14A,  SC 13G/A
		2/10/06		5					DFAN14A
		2/8/06		5		7
		12/31/05		4		7			10-K
		12/14/05		3
		12/6/05		3		6			8-K
		8/15/05		4
		5/13/05		4
		1/30/05		4
		5/4/99		4
									List all Filings