<SUBMISSION>
<ACCESSION-NUMBER>0001104659-07-012746
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>2
<PERIOD>20070215
<ITEMS>2.02
<ITEMS>9.01
<FILING-DATE>20070221
<DATE-OF-FILING-DATE-CHANGE>20070221
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>CAREER EDUCATION CORP
<CIK>0001046568
<ASSIGNED-SIC>8200
<IRS-NUMBER>363932190
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>000-23245
<FILM-NUMBER>07639347
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>2895 GREENSPOINT
<STREET2>SUITE 600
<CITY>HOFFMAN ESTATES
<STATE>IL
<ZIP>60195
<PHONE>8477813600
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>2800 WEST HIGGINS ROAD
<STREET2>SUITE 790
<CITY>HOFFMAN ESTATES
<STATE>IL
<ZIP>60195
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>a07-4825_38k.htm
<DESCRIPTION>8-K
<TEXT>
<html>

<head>







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<body lang="EN-US" style=" text-justify-trim:punctuation">

<div style="font-family:Times New Roman;">
 <div style="border:none;border-top:double windowtext 6.0pt;padding:0pt 0pt 0pt 0pt;"> <p style="border:none;margin:0pt 0pt .0001pt;padding:0pt;"><a name="scotch"></a><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p> </div>

<p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;">UNITED
STATES<br>
SECURITIES AND EXCHANGE COMMISSION</font></b></p>

<p align="center" style="margin:0pt 0pt 12.0pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Washington,
D.C.&nbsp; 20549</font></b></p>

<p align="center" style="margin:0pt 0pt 12.0pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;">FORM
8-K</font></b></p>

<p align="center" style="margin:0pt 0pt 12.0pt;text-align:center;"><b><font size="3" face="Times New Roman" style="font-size:12.0pt;font-weight:bold;">CURRENT
REPORT</font></b></p>

<p align="center" style="margin:0pt 0pt 12.0pt;text-align:center;"><b><font size="3" face="Times New Roman" style="font-size:12.0pt;font-weight:bold;">Pursuant
to Section 13 or 15(d) of<br>
The Securities Exchange Act of 1934</font></b></p>

<p align="center" style="margin:0pt 0pt 12.0pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Date of Report
(Date of Earliest Event Reported):<i>
&nbsp;&nbsp;&nbsp;</i><b>February
15, 2007</b></font></p>

<p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;">Career
Education Corporation</font></b></p>

<p align="center" style="margin:0pt 0pt 12.0pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Exact Name of
Registrant as Specified in Charter)</font></p>

<div align="center">

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="font-size:10.0pt;margin:0pt 0pt .0001pt;text-align:center;"><!-- SET mrlNoTableShading --><b>Delaware</b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">0-23245</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">36-3932190</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(State or Other
  Jurisdiction</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Commission</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(IRS Employer</font></p>
  </td>
 </tr>
 <tr>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">of
  Incorporation)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">File Number)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Identification
  No.)</font></p>
  </td>
 </tr>
 <tr>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="65%" colspan="3" valign="top" style="padding:0pt .7pt 0pt .7pt;width:65.88%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;2895
  Greenspoint Parkway, Suite 600, Hoffman Estates, IL</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">60169</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="65%" colspan="3" valign="top" style="padding:0pt .7pt 0pt .7pt;width:65.88%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Address of
  Principal Executive Offices)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt .7pt;width:2.38%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="31%" valign="top" style="padding:0pt .7pt 0pt .7pt;width:31.74%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Zip Code)</font></p>
  </td>
 </tr>
</table>

</div>

<p style="line-height:1.0pt;margin:0pt 0pt 12.0pt;"><font size="1" face="Times New Roman">&nbsp;</font></p>

<p align="center" style="margin:0pt 0pt 24.0pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Registrant&#146;s
telephone number, including area code<b> (847)
781-3600</b></font></p>

<p align="center" style="margin:0pt 0pt 12.0pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Former name or
former address, if changed since last report.)</font></p>

<p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):</font></p>

<p style="font-size:10.0pt;margin:0pt 0pt .0001pt;"><font size="2" face="Wingdings" style="font-size:10.0pt;">o</font>
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)</p>

<p style="font-size:10.0pt;margin:0pt 0pt .0001pt;"><font size="2" face="Wingdings" style="font-size:10.0pt;">o</font>
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)</p>

<p style="font-size:10.0pt;margin:0pt 0pt .0001pt;"><font size="2" face="Wingdings" style="font-size:10.0pt;">o</font>
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))</p>

<p style="font-size:10.0pt;margin:0pt 0pt .0001pt;"><font size="2" face="Wingdings" style="font-size:10.0pt;">o</font>
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))</p>


 <div style="border:none;border-bottom:double windowtext 6.0pt;padding:0pt 0pt 0pt 0pt;"> <p style="border:none;margin:0pt 0pt .0001pt;padding:0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p> </div>
</div><br><hr size="3" width="100%" noshade color="#010101" align="center">

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<div>


<p style="margin:0pt 0pt 12.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Item
2.02 Results of Operations and Financial Conditions.</font></b></p>

<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">On February 15, 2007,
Career Education Corporation (the &#147;Registrant&#148;) issued a press release to
report the Registrant&#146;s financial results for the quarter and year ended
December 31, 2006, and conducted a conference call to discuss those
results.&#160;&#160; A copy of the transcript of
the Registrant&#146;s conference call is attached hereto as Exhibit 99.1, and the
information contained therein is incorporated herein by reference.&nbsp; The
information contained in Item 2.02 to this Form 8-K, including the exhibit,
shall not be deemed &#147;filed&#148; for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended, and the information shall not be deemed
incorporated by reference into any filing under the Securities Act of 1933, as
amended, except as shall be expressly set forth by specific reference in such
filing.</font></p>

<p style="margin:0pt 0pt 12.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Item
9.01 Financial Statements and Exhibits.</font></b></p>

<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d) Exhibits</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;font-family:Times New Roman;width:100.0%;">
 <tr style="page-break-inside:avoid;">
  <td width="7%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0pt .7pt 0pt 0pt;width:7.14%;">
  <p align="left" style="font-size:8.0pt;font-weight:bold;line-height:8.0pt;margin:0pt 0pt .0001pt;text-align:left;"><!-- SET mrlNoTableShading -->Exhibit<br>
  Number</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0pt .7pt 0pt 0pt;width:2.62%;">
  <p style="font-weight:bold;line-height:8.0pt;margin:0pt 0pt .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></b></p>
  </td>
  <td width="90%" valign="bottom" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0pt .7pt 0pt 0pt;width:90.24%;">
  <p style="font-weight:bold;line-height:8.0pt;margin:0pt 0pt .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;">Description of Exhibits</font></b></p>
  </td>
 </tr>
 <tr style="page-break-inside:avoid;">
  <td width="7%" valign="top" style="border:none;padding:0pt .7pt 0pt 0pt;width:7.14%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:2.62%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="90%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:90.24%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr style="page-break-inside:avoid;">
  <td width="7%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:7.14%;">
  <p align="center" style="margin:0pt 0pt .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">99.1</font></p>
  </td>
  <td width="2%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:2.62%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="90%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:90.24%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Transcript of conference call of Registrant on
  February 15, 2007.</font></p>
  </td>
 </tr>
</table>

<p style="line-height:1.0pt;margin:0pt 0pt 12.0pt;"><font size="1" face="Times New Roman">&nbsp;</font></p>


 <p style="font-size:10.0pt;margin:24.0pt 0pt .0001pt;text-align:center;"><font face="Times New Roman">2</font></p> <br><hr size="3" width="100%" noshade color="#010101" align="center">

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<p align="center" style="margin:0pt 0pt 12.0pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">SIGNATURES</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-indent:39.6pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Pursuant to the
requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly
authorized.</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;font-family:Times New Roman;width:100.0%;">
 <tr style="page-break-inside:avoid;">
  <td width="45%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:45.92%;">
  <p style="font-size:10.0pt;margin:0pt 0pt .0001pt;"><!-- SET mrlNoTableShading --></p>
  </td>
  <td width="54%" colspan="2" valign="top" style="padding:0pt .7pt 0pt 0pt;width:54.08%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">CAREER EDUCATION CORPORATION</font></p>
  </td>
 </tr>
 <tr style="page-break-inside:avoid;">
  <td width="45%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:45.92%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="54%" colspan="2" valign="top" style="padding:0pt .7pt 0pt 0pt;width:54.08%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr style="page-break-inside:avoid;">
  <td width="45%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:45.92%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="54%" colspan="2" valign="top" style="padding:0pt .7pt 0pt 0pt;width:54.08%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr style="page-break-inside:avoid;">
  <td width="45%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:45.92%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:6.56%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="47%" valign="top" style="border:none;border-bottom:solid windowtext 1.0pt;padding:0pt .7pt 0pt 0pt;width:47.52%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/ Patrick K. Pesch</font></p>
  </td>
 </tr>
 <tr style="page-break-inside:avoid;">
  <td width="45%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:45.92%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:6.56%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="47%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:47.52%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Patrick K. Pesch</font></p>
  </td>
 </tr>
 <tr style="page-break-inside:avoid;">
  <td width="45%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:45.92%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="6%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:6.56%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="47%" valign="top" style="padding:0pt .7pt 0pt 0pt;width:47.52%;">
  <p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive Vice President, Chief Financial Officer,
  and <br>
  Assistant Secretary</font></p>
  </td>
 </tr>
</table>

<p style="line-height:1.0pt;margin:0pt 0pt 12.0pt;"><font size="1" face="Times New Roman">&nbsp;</font></p>

<p style="margin:0pt 0pt 12.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dated: February 21, 2007</font></p>


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<p align="right" style="margin:0pt 0pt 12.0pt;text-align:right;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit
99.1</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:2.0pt;">CORPORATE PARTICIPANTS</font></b></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Karen King</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Career Education Corporation - VP, Investor
Relations</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Career Education Corporation - Interim
President, CEO</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Career Education Corporation - CFO</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Stephen Fireng</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Career Education Corporation - Group President</font></i></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:2.0pt;">CONFERENCE CALL PARTICIPANTS</font></b></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Sara Gubins</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Merrill Lynch - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Matthew Litfin</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;William Blair &amp; Co. - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jennifer Childe</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Bear Stearns - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gregory Cappelli</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Credit Suisse - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;UBS - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jeffrey Silber</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;BMO Capital Markets - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Suzanne Stein</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Morgan Stanley - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jerry Herman</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Stifel Nicolaus - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Mark Marostica</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Piper Jaffray - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Lehman Brothers - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Trace Urdan</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Signal Hill Group LLC - Analyst</font></i></p>

<p style="margin:0pt 0pt .0001pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Steven Barlow</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&#160;Prudential Equity Group - Analyst</font></i></p>

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<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:2.0pt;">&#160;PRESENTATION</font></b></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Good day,
ladies and gentlemen, and welcome to the fourth quarter 2006 Career Education
earnings conference call. My name is Jacula and I will be your coordinator for
today. At this time, all participants are in listen-only mode. We will conduct
a question-and-answer session towards the end of this conference. [OPERATOR
INSTRUCTIONS] As a reminder, this conference is being recorded for replay
purposes. I would now like to turn the call over to Ms. Karen King. Please
proceed, ma&#146;am.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Karen King <i>&#160;</i>-<i>
Career Education Corporation - VP, Investor Relations</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you. Good
afternoon, everyone. Thank you for joining us on our fourth quarter and full
year 2006 earnings call today. I am Karen King, Vice President, Investor
Relations. With me today are Bob Dowdell, Interim President and Chief Executive
Officer; Pat Pesch, Chief Financial Officer; and Steve Fireng, Group President.
Following a brief presentation by management, the call will be opened for
analyst and investor questions.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This conference call is being webcast live on the
Investor Relations section of our website at www.careered.com. The replay will
also be available on our site. If we are unable to answer your questions during
the call, please call our Investor Relations department at 847-585-3899.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Before I turn the call over to Bob, let me remind you
that today&#146;s press release and the presentations made by our executives may
include forward-looking statements as defined in the Private Securities
Litigation Reform Act of 1995. These statements are based on information
currently available to us and involve risks and uncertainties that could cause
our actual results, performance, and business prospects and opportunities to
differ materially from those expressed in or implied by these statements.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">These risks and uncertainties include, but are not
limited to, those factors identified in our fourth quarter earnings release and
in our Annual Report on Form 10-K for the year ended December 31, 2005 and from
time to time in our other filings with the Securities and Exchange Commission.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Except as expressly required by securities laws, we
undertake no obligation to update such factors or to publicly announce the
results of any of these forward-looking statements to reflect future events,
developments or changed circumstances or for any other reason. Now let me turn
the call over to Bob Dowdell.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert&#160;
Dowdell <i>&#160;- Career Education Corporation - Interim
President, CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you,
Karen. Good afternoon everyone. When we talked on our last call, I told you I
would not act as a caretaker, that I planned in cooperation with the senior
leaders of the Company and the Board of Directors to commence a process to
address business, regulatory and operational issues facing Career Education.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Our first order of business was to take a long hard
look at how this Company was operating from the inside out and to candidly
evaluate where we are and where we needed to go. Career Education is a Company
with a strong portfolio of assets, a stunning amount of talent, intellectual
know-how, and industry experience supported by top of the line technology, all
of which further enhances our ability to capitalize on market demand and
opportunities.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">But we are also a Company with operational challenges
that have been impeding our ability to properly leverage these assets. Part of
the evaluation we undertook over the last quarter was to identify and, frankly,
get to the bottom of some of these challenges. First, while we have made
significant progress, AIU&#146;s central administration, faculty and staff continue
to work tirelessly to resolve the remaining SACS recommendations in connection
with the University&#146;s continued probation.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Second, we have not made the progress we would like to
have made in implementing our hybrid program, or what I would like to call our
flexible learning program. In addition, decreasing population has been a
challenge for us, although as you can see in the numbers for the fourth quarter
several of our segments, particularly Culinary and Health, are demonstrating
significant improvements. We are also seeing early indications of improvement
in the University Group, although you won&#146;t see that in the information we&#146;ve
provided to date.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">So we began the process of tackling these challenges
and here&#146;s what we have accomplished to date. The significant issue confronting
Career Education is how to better leverage the tremendous technological
capacity and the proprietary virtual campus which supports our fully online</font></p>

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<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">platforms of AIU and CTU. Up to this point, this
technology was essentially available only to our institutions within the
University Group and effectively was not available to any of our other schools.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The ability to take full advantage of the flexible
delivery of this education, online, on ground or hybrid is really at the heart
of our strategic operational realignment. Our students are clearly looking for
these kinds of alternatives in delivery. A 2006 eduventures survey on the
demand for online education found that 57% of the respondent&#146;s preferred some
form of hybrid education. Another analysis by the National Center for Academic
Transformation suggested a hybrid learning model can increase student retention
rates and performance of at-risk students, including those with skill
deficiencies in reading, writing and math.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In order to offer more program flexibility, we have
developed an online service center. Through the service center the technology
that AIU and CTU currently use will be leveraged to make online and flexible
education available across all of our schools. As a service provider, the
center will offer customization to meet the varying needs of our students and
the varying curricula of our individual schools.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The ability to offer flexible educational delivery
combined with the large number of and variety of our brick-and-mortar campuses
is an offering that further distinguishes us in the marketplace giving more
students more choices to learn in ways that fit more lifestyles. With respect
to timelines, in April we expect to offer Gen Ed online courses to students at
a number of our brick-and-mortar schools.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In May, we expect to launch marketing for a July start
of our new IADT Online school which is nationally accredited offering 100%
online design degree programs, as well as flexible design education offerings
based in a number of our brick-and-mortar IADT campuses.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In conjunction with the realignment, we have made
several changes with respect to our senior management team. Steve Fireng, who
was formerly President of the University Group now oversees that group as well
as our Academy and College Divisions. Paul Ryan, who led the turnaround in our
Culinary and Health Divisions, will continue to oversee those groups. After
over a decade of outstanding service to this Company in a number of roles, Jake
Gruver will be retiring, but he has graciously agreed to stay on to manage the
sale of the Gibbs division, as well as our Lehigh Valley and McIntosh colleges.
Similarly, Steve Sotraidis, formerly our Executive Vice President of
Administration, will also be retiring, but he is lending us his considerable
expertise in managing the sale of our Brooks College on the West Coast.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We are focused on operational excellence. First, we
have reduced redundancies in staffing at the corporate level. We have also
streamlined decision making so the operators of our business, our divisions and
our schools can more efficiently make and implement decisions to effectively
respond to the market and the needs of our students. Our corporate staff is
committed to the shifting of its focus to better serving our line operators.
There are, however, critical monitoring and oversight functions that will be
retained by our corporate staff, and particularly our compliance functions.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We are effectively working on the issues before us on
the regulatory front. Our employees deserve a great deal of credit for their
tremendous efforts in addressing the issues raised by the Department of
Education. Even though AIU&#146;s probationary status was extended, it is clear the
University&#146;s efforts over the last year to address the accreditors areas of
concern have had a positive result.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The special committee of the Commission on Colleges of
SACS acknowledged that AIU has resolved many of its initial concerns and AIU
has made progress in instituting positive change. AIU continues to be focused
on resolving all remaining issues and on demonstrating continuous practice of
the positive changes it had previously implemented.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We are seeing significant progress in improving in our
admissions productivity as a result of implementing measures that we talked
about previously, such as supplemental compensation program for admission
representatives based on student retention, a system for better qualification
of leads, extended payment plans for students with specific financial needs and
more focused attention and support in generating student referrals.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The numbers tell the story on our early adopters,
which are Culinary and Health. We&#146;re turning the corner with those schools as a
result of these initiatives and are experiencing a substantial uptick in starts
and show rates in these divisions. Our academies and colleges are just
beginning to implement these initiatives and we will work with them to ensure
full execution over the next couple of quarters.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We continue to maintain our focus and build our
strengths in career as a passion. Increasingly popular fields such as art and
design, culinary and healthcare, in which we have substantial expertise and
experience. As we announced in November, in order to concentrate our resources
on those areas where we have the greatest competitive advantage, we&#146;ve begun
the process of selling 13 of our schools.</font></p>

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<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Although we have experienced some delays in putting
out the sales material, as a result of readjusting the numbers based on the
recent regulatory issues with our Katherine Gibbs School in New York, we will
have the book ready in the next week or two.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Consistent with our more targeted business strategy
and focus we are eliminating our JDV Online division. Chefs.com, the culinary
enthusiasts website, will be moved into our Culinary division and we will be
discontinuing blish.com.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We recently made a very exciting acquisition of the
Istituto Marangoni schools, world renowned for fashion design located in Milan,
London and Paris. We continue to look at other international opportunities that
will add value and are consistent with our focus. With respect to acquisitions
domestically, we previously announced that the U.S. Department of Education has
lifted its restrictions it placed on our ability to acquire schools and open
new campuses. We will be extremely selective in evaluating domestic
acquisitions.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">New acquisitions would likely be premier schools with
a well respected brand that would complement our current portfolio of schools,
much like the Brooks Institute of Photography, or the Marangoni schools. We
continue to develop start ups particularly in certain divisions such as our
academy and culinary schools. Our Kitchen Academy start up in Sacramento opens
next week. And two more Kitchen Academies, in Seattle and St. Louis, are
planned for the end of the year.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Our IADT school in San Antonio is expected to open in
April, and another academy school in Sacramento is expected to open in late
May. We are planning to open Le Cordon Bleu culinary schools in Dallas and
Boston by the first quarter of 2008. Start ups offer us the ability to grow at
a more consistent and manageable pace than acquisitions in carefully selected
markets with branded schools in which we have proven expertise and success.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Pat Pesch will take you through the financials in just
a moment. But let me summarize by saying that while we recognize the
significant challenges that I outlined earlier, we are working to address them
and we are seeing positive signs in several of our divisions. Our show rates
are improving, as are our student retention rates. The balance sheet continues
to be strong, and our initiatives in lead qualifying, referral support,
extended payment plans and supplemental compensation will have increasing
impact in the next few quarters. We currently have a lot of work to do in this
process. But the indicators over the last four months tell us we are indeed
moving in the right direction. So with that I will give it to you, Pat.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you, Bob.
Let me begin by mentioning that this afternoon&#146;s press release has numerous
exhibits which were intended to provide financial details, segment information
and discontinued operations support that could not be readily included in the
body of the release.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We have attempted to provide that information as
clearly and concisely as possible, but we recognize that within such a large
volume of information there are likely to be many questions on specific data. I
will try in my comments to provide information in anticipation of those
questions but investors and analysts should feel free to contact me or Karen
King to address any remaining questions still unanswered after this call.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Now I will proceed with my comments on the financial
results for the quarter. With respect to revenue from continuing operations,
fourth quarter 2006 revenue of $429 million decreased 10.5% from fourth quarter
2005, with campus based revenue down 3.5% and online based revenue down 22.8%.
Operating profit margin from continuing operations was 10.8% during the fourth
quarter 2006 compared to 22.8% during fourth quarter 2005. To understand the
results more fully we must look at our individual segment results.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We had three segments show margin declines from 2 to 4
percentage points primarily driven by lower revenue.&#160; Two segments that showed improvement of 2%
points or more. Our university segment, which represents about 40% of
continuing operations revenue showed a decline of about 17 percentage points.
This large decline was primarily driven by declines in revenue at our AIU
campuses, including the significant effects on marketing effectiveness of AIU&#146;s
SACS probation, additional expenses associated with addressing changes prompted
by the probation and other competitive factors within the online environment.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Some specifics are as follows: Revenue from online
students was down 22.8% from fourth quarter of 2005. AIU online revenue was
down 33%. Colorado Tech online revenue was up 2%. Population for online
students is down 12.8% from the fourth quarter 2005 with AIU Online population
down 26% while Colorado Tech online population was up 14%.</font></p>

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<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Online operating profit margins are 22%, down over 14
percentage points from the fourth quarter of 2005. In addition to school level
operating performance we had significantly higher unabsorbed corporate overhead
during the fourth quarter. This was due to lower revenue levels at continuing
and discontinuing schools resulting in lower absorption of overhead and also
the inclusion of noncomparable charges in the fourth quarter. These charges
included severance costs and share-based compensation expense recorded during
the fourth quarter of 2006 totaling $6.4 million on a pre-tax basis with no
comparable 2005 cost.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">As Bob indicated, we have undertaken an initiative to
streamline our corporate operations to improve our effectiveness. This effort
will also result in significant cost savings. During January and February we
have reduced corporate head count through involuntary reductions of about 100
positions and voluntary reductions of about 20 more positions. Total annualized
savings from these reductions will be about $15 million. First quarter savings
will be negligible, as most of these reductions occurred in February and will
be largely offset by severance and related costs.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In addition, we have targeted annualized non-payroll
reductions of about $10 million to $15 million, most of which will not
materialize until the second half of 2007. With respect to net income from
continuing operations, fourth quarter net was $39.9 million or $0.41 per
diluted share versus $73.7 million or $0.73 per diluted share during the fourth
quarter of 2005. Full year net income from continuing operations was $94.8
million or $0.97 per diluted share versus $250 million or $2.42 per diluted
share during 2005.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">With respect to discontinued operations, discontinued
operations which includes 13 schools and campuses currently held for sale had
pre-tax losses for the year of $73.6 million and a net loss of $48.2 million.
Pre-tax operating losses for the year, which are included in the amounts I just
mentioned, were $39 million with fourth quarter operating losses of only $3.1
million. In addition to these normal operating losses we also had a number of
other charges which I will describe.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">During the fourth quarter, we recorded a pre-tax
charge of $9.2 million for the acceleration of rent expense for excess unused
lease space. We also recorded a pre-tax charge of $15 million to reduce the
carrying value of our discontinued assets to an estimated fair value less the
cost to sell. Also, as previously disclosed, we recorded a pre-tax goodwill
impairment charge earlier in the year of $10.4 million.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Switching to cash uses and issues, during the fourth
quarter, we repurchased approximately 1.7 million shares for $41.3 million or
an average price of about $25 per share which brought our total repurchases in
2006 to 5.6 million shares for $166.1 million. From inception of the buy back
program through December 31, 2006 we repurchased 10.8 million shares for
approximately $366 million and have approximately $134 million of authorized
repurchase capacity.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">With respect to capital spending, capital expenditures
decreased during the fourth quarter $11.5 million or 2.7% of revenue during the
fourth quarter of 2006, reduced from $23.4 million or 4.9% during the fourth
quarter of 2005. Full year capital spending was down to $69.3 million or 3.9%
of revenue versus $112.3 million or 6.1% during 2005. With that I will turn it
back over to Bob.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation. - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you, Pat.
So in summary, we feel like we have made substantial progress during the
quarter but it will take time for these benefits to show up in the financial
reports as Pat outlined. We have realigned the corporate office to reduce
redundancies and embark on a program to streamline decision making and
operating effectiveness. We are leveraging our existing online technology and
support services to provide flexible delivery of education beyond the
University Group to all of our schools.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Over the last four months, we have taken specific
actions in the process of resolving the issues that have slowed us down in
recent quarters. As we prepare to announce a new CEO by the end of the first
quarter, and we&#146;re still on track to do that, we have the portfolio, the
expertise, the technology, the capital and we are putting into place the
processes to move this Company forward so it is fully capable of meeting its
potential and returning great value to all its constituencies. Now, I would
like to take your questions.</font></p>

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<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman"><font style="font-size:10.0pt;letter-spacing:2.0pt;text-transform:uppercase;">&#160;</font><b style="letter-spacing:2.0pt;">QUESTION AND ANSWER</b></font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;[OPERATOR
INSTRUCTIONS] Please standby while we compile our list. The first question is
from Sara Gubins with Merrill Lynch. Please proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Sara Gubins <i>&#160;</i>-<i>
Merrill Lynch - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Hi. Thank you.
The plan to streamline corporate operations, can you talk a bit about what
areas you targeted with the head count reduction?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I think it is
fair to say that the reductions were fairly broad throughout our operations.
There was no one particular area. Some of what we did was really try to reduce
some of the layering within the group, and essentially push as much of the
decision making as we could closer to the schools and, but there was no one
functional area that shared any disproportionate share of reduction.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Sara Gubins <i>&#160;</i>-<i>
Merrill Lynch - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay, and just
one quick follow up. Pat, did you, I thought I heard you say CTU online revenue
was up only 2% but it sounded like enrollment was up more than that?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;That&#146;s correct.
Population was up about 14%. Revenue up only about 2%. There is a little bit of
a disconnect between those numbers. That 14% number really is as of the end of
January. So it does reflect the January starts. So it is not a perfect
apples-to-apples match. The other thing is we have seen some reduction in our
average revenue per student within Colorado Tech as we have increased the
number of associate degree students which through Stonecliffe are at a lower
average revenue per student.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Sara Gubins <i>&#160;</i>-<i>
Merrill Lynch - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Thank
you. I&#146;ll turn it over.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Sara, Bob. Just
to reiterate a little more on the organizational structure. We felt we were too
top heavy. As we came together between the online group and the
brick-and-mortar business it became more apparent. We were very selective in
where we made our reductions but we basically wanted to put much more decision
making capability in the line folks as opposed to the staff folks, and the
closer we could get it to the school the better.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Sara Gubins <i>&#160;</i>-<i>
Merrill Lynch - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Thank
you.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes from the line of Matt Litfin with William Blair &amp; Company.
Please proceed, sir.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Matthew Litfin <i>&#160;</i>-<i> William Blair &amp; Co. - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Yes, hi. I have
a question on the spread between the enrollment growth and the revenue growth
at AIU. What is it now and where do you see that bottoming out?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I mentioned
that we had about a &#151; revenue was down 33%, population was down 26% for AIU
Online again Similar factors at play there, Matt, with respect to lower revenue
per student. Two things that would be influencing that. One, we did mid-year
last, in 2006 adjusted our associate degree pricing so in terms of comparison
to</font></p>

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<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">last year same time that is an influence on the
revenue pursued. Secondly, late in the year and this was probably a smaller
part of the influence, we did introduce some part-time program options within
AIU. Not a lot of students enrolled in that at this time but that is something
we would look at while it would lower the metric in terms of revenue per
student it should result in really a broader market that we can serve.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Matthew Litfin <i>&#160;</i>-<i> William Blair &amp; Co. - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Great.
Thank you.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes from the line of Jennifer Childe with Bear Stearns. Please
proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jennifer Childe <i>&#160;</i>-<i> Bear Stearns - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Hi, can you
hear me?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Bob Dowdell <i>&#160;</i>-<i>
Career Education Corporation - Interim President, CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Yes.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jennifer Childe <i>&#160;</i>-<i> Bear Stearns - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;What were the
$10 million to $15 million in non-payroll related savings? Pat, you mentioned
that some of these savings from the payroll reductions wouldn&#146;t be seen
initially because of severance. Would we see $15 million in savings in &#145;07 or
maybe $10 million? How should we think about that?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Let me start
with the back part of the question in terms of the payroll savings. The $15
million is kind of a full year effect. So because those didn&#146;t take place on
January 1, we won&#146;t see that full year effect. I would tell you that we should
see a full credit for those beginning in the second quarter. Roughly take $15
million and divide by four. That is your quarterly savings beginning in the
second quarter.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We won&#146;t see much in the first quarter just because we
got most of those done during February and we have got severance cost and some
out placement services that we provided for those former employees that will be
in the $1.5 million to $2 million range. With respect to the non-payroll
savings, essentially we are looking at a number of areas.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We are looking at some of our use of consultants
versus employees and some IT related projects related to some of our
Sarbanes-Oxley compliance. A number of other areas like that. Then we are also
just looking at what I would call the, some of the savings that are just
associated with the head count reduction. Less employees, less travel, things
of that nature. That is really the bulk of it.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">There is a opportunity to negotiate telecommunication
contracts and things like that. Those are the things that may take us a number
of months to put in place. Some of those savings are really resulting from
merging with some of our online support operations with our pure corporate
activity.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jennifer Childe <i>&#160;</i>-<i> Bear Stearns - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;If I could just
squeeze one more in. Bob, you mentioned you are seeing some improvement in the
university segment. Can you give us some color on that? Have operations in that
segment troughed?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I&#146;m going to
let Steve answer that question.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Stephen Fireng <i>&#160;</i>-<i> Career Education Corporation - Group President</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Yes, how are
you doing? I guess a couple things. First of all, attrition in the fourth
quarter at both of AIU and CTU online has continued to improve. We had really
dramatic improvement over at AIU, and the other things we had in January some
of our highest success, CTU had the highest lead conversion since February of &#145;05
in January. We had our highest enrollment month ever in January. We had our
best attrition month since March of &#145;05.</font></p>

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<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">There is some nice positive trends going on at CTU
online. When you move other over to AIU we consistently have been above 55% in
our show rates for the last five starts. We had one of our higher months of
enrollment that we have had in the last six or seven months over at AIU online.
We&#146;re starting to see, I think one of the driving factors is we stemmed the
tide of attrition. It has been better year-over-year and we are just getting an
understanding of our new process that these admissions advisers are going
through.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jennifer Childe <i>&#160;</i>-<i> Bear Stearns - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Is it safe to
say that segment performance has troughed?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I think if you
look at it from a financial standpoint, the front part of this year will still
show significant year-over-year declines because we are really looking at lower
population levels carrying into 2007 than we had in 2006, so that depressed revenue
level will stay with us for the first half of the year, and our expectation
would be if we continue to see some of this improving trends that we could be
looking at improvements in the second half of the year.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Our online operations still have 20% plus operating
margins. We think we will maintain something roughly in that area for the first
part of the year, but it will take us awhile to get it moving back up the other
direction.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jennifer Childe <i>&#160;</i>-<i> Bear Stearns - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thanks a lot.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation &#150; CFO</i></font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;You are
welcome.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes from the line of Greg Cappelli with Credit Suisse. Please
proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gregory Cappelli <i>&#160;</i>-<i> Credit Suisse - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Hi, Bob and
Pat.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Hi.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gregory Cappelli <i>&#160;</i>-<i> Credit Suisse - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;A couple quick
ones. Could you guys, I am sorry if I missed this, break down the operating
margin and CTU and AIU?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;We did not do
that. I can tell you the operating margins for, if we are talking about the
online piece, the operating margins for the online business are in the mid-20s
for CTU. For CTU they were in the mid-teens. Both of those are down from a year
ago.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gregory Cappelli <i>&#160;</i>-<i> Credit Suisse - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Just back
to the cost savings for a second. You gave out the two numbers. In either of
those two is there anything from the discontinued operations, as well?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;No.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gregory Cappelli <i>&#160;</i>-<i> Credit Suisse - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Is it
possible we will see additional charges in Q1 or 2Q coming from that?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I am not sure I
understand the question, Greg.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert&#160;
Dowdell <i>&#160;</i>-<i>
Career Education Corporation - Interim President, CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Severance pay
and things like that.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gregory Cappelli <i>&#160;</i>-<i> Credit Suisse - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Exactly.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;In the first
quarter, as I mentioned, we have severance about $1.5 million to $2 million in
the continuing operations. There will be a charge for that. But that should be
roughly offset by the payroll savings that we will experience during the first
quarter that is why I said before we&#146;d seen negligible benefits. So there will
be payroll savings offset by the severance and out placement services. No net
negative charge to continuing operations in the quarter.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gregory Cappelli <i>&#160;</i>-<i> Credit Suisse - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Steve,
just back to you for a second. You were talking about is the worst past us here
in online, especially at AIU. Is it possible with starts being down the way
they are, could we actually see that trend reverse and stabilize before
December of &#145;07?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Stephen Fireng <i>&#160;</i>-<i> Career Education Corporation - Group President</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Well, yes, if
January is an indication certainly that trend can continue. I think we have put
in a lot of, a year&#146;s worth of work in the process, we&#146;ve added a lot from an
online slide show to give more and more information.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I think what you will find is we have a huge branding
effort, we contracted with a branding company to make sure that that brand
continues to be stronger and stronger throughout the year. To be candid with
you, our student satisfaction surveys continue to be very, very strong. I don&#146;t
know exactly what, how high it can go or how much stabilization but we
certainly have seen some nice trends to indicate we can stabilize that.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Greg, the
year-over-year comps will essentially get easier in the second half of the
year. What we are really experiencing is for the most part after the January
starts of 2006 we started to see declines in the start activity.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">So because of accelerated programs there you are
looking at about a year long period where the decline in starts was causing
significant decline in population. Beginning late in the first quarter, it is
to the point where you have year-over-year comparable starts in terms of
probation influence and other competitive factor influences, so by the second
half of the year most of those, both the population influences, as well as some
of the pricing influences basically lap. You get into better comps.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;One more thing,
Greg, notwithstanding that, the level has improved over what that commentary
might have told you. It is hard to say 45 days is a trend. It is certainly a
great indication, but it&#146;s been for 45 days.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gregory Cappelli <i>&#160;</i>-<i> Credit Suisse - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay, I
understand. I&#146;ve got a couple more, I will jump back in the queue, thank you.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;[OPERATOR
INSTRUCTIONS] Your next question comes from the line of Kelly Flynn with UBS.
Please proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thanks. A
couple of quick ones. The tax rate in the quarter, I know you detailed for the
year what was going on, but the tax rate was a lot lower than expected in the
quarter. What happened there?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Well, really we
have done what we have in the past fourth quarters. We had a full year
information in front of us we trued up our estimated taxes for the year. This
year it is a little harder looking at the numbers to kind of sort through it a
bit because we have got the goodwill impairment charges we recorded earlier in
the year. A lot of that is non tax deductible and it causes an inflated full
year rate.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If we adjust out the non-deductible goodwill write-off
that we took, we had been accruing or making provision for income taxes for
continuing operations at about 37.4% during the year. That rate was reduced to
approximately 35% on a full year basis during the fourth quarter.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">That is about a little better than a $6 million impact
on the quarter in terms of the actual adjustment, actually about $6.7 million.
So close to $0.07 a share. I would tell you about $0.02 of that would be
something that is properly placed in the fourth quarter. The rest of it is an
adjustment to the higher provision rate that we had used for the first nine
months.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Thank
you.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;On a go forward
basis, that 35% is a significant reduction. Some of that is influenced by some
of the declines in profitability that we have had, so during 2007 I would expect
the rate to be somewhere between that 35% and the 37% level we were at
previously. That is going to be a function of the level of recovery in our
overall earnings.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Great.
Following up on Jennifer&#146;s question, can you give us any guidance on the growth
rate you expect from continuing operations enrollment in the first quarter, and
also specifically for university on a year-over-year basis? Will the decline
widen, narrow?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Let me suggest
this. We have indicated before that we weren&#146;t going to provide specific
guidance in terms of quarterly or the annual results. I would say if you look
at the individual segment information that we have disclosed you will see that
in some of the segments you are seeing some evidence of turn around, some
improvement in terms of the growth, particularly within the Culinary,
Healthcare and International segments and some more modest improvements within
the Academy.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I would suggest that those, we would expect there
would continue to be gradual improvement in the year-over-year growth numbers
for those. The others we do expect improvement. I would tell you the one that I
would expect to be at the slower end of improvement would be our College Division,
the continuing College Divisions, although they are still pretty healthy and
still very profitable, their population is down significantly. They are at the
early stages of turning that around.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. But for
University you think it will be down less than 12% in the first quarter?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;We are not
going to provide a specific number there.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;It is
improving? That is what it implies.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;We would expect
an improving trend in the year-over-year starts. I talked about that kicking in
late in the first quarter.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;But I am
talking about population.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;The starts are
what is going to drive the population.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;So will
retention. Do you expect the population to be down less than 12%? That is my
question.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I will try to
politely suggest that we said we are not going to provide specific guidance.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Thank
you.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;You are
welcome.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Next question
comes from Jeff Silber with BMO Capital Markets. Please proceed, sir.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jeffrey Silber <i>&#160;</i>-<i> BMO Capital Markets - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you so
much. At the beginning of the prepared remarks there was a comment about the
hybrid program being disappointing. I was wondering if you can you give a
little bit more color on that?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Sure. This is
Bob. It is my personal opinion it is taking too long to get this going. The
market need for it and the, effectively, the advantage it would give us in a
lot of situations is astounding but it has taken far too long to get going. And
really because it was embedded in one of the segments of the business.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">What we needed to do was to make that asset available
to all the businesses and put somebody in charge of making it happen. We have
done that. The other thing we did, by the way, is we took a couple of the folks
out of the JDV business that were originally involved in the start up of the
online business and put them in charge of this hybrid undertaking. They have
both brick-and-mortar experience and they certainly have online experience and
they have great technology experience . It was just taking too long.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jeffrey Silber <i>&#160;</i>-<i> BMO Capital Markets - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;When you had
given out metrics between the online and campus base are those hybrid folks
included in the campus-based population and revenues?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Yes.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jeffrey Silber <i>&#160;</i>-<i> BMO Capital Markets - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay, great.
And then just one more, I&#146;m sorry. I know you are not giving guidance for &#145;07.
But can you tell us roughly what we should expect for capital expenditures and
stock-based comp in &#145;07?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Start with the
stock-based comp. We expect that to be comparable to possibly or slightly down
in 2007. With respect to start ups, basically the capital spending, we may
actually see, while we were at a pretty modest level of capital spending in
2006 relative to the past, we would actually expect to see that go up as a
percentage of revenue as we renew start up activity.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bob, in his comments walked through the locations
where we are expecting to see new schools. At Kitchen Academy and LCB, or Le
Cordon Bleu Culinary Schools, you are generally looking at $5 million or $6
million per campus there. The Academy start ups are more modest, a couple
million dollars less per campus to get those up and running.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Stephen Fireng <i>&#160;</i>-<i> Career Education Corporation - Group President</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;This is Steve.
One of the first steps is to leverage this Gen Ed opportunity, and that&#146;s
really and opportunity for our College Division to leverage the Gen Ed that we
already are developed and we are pushing that. Another great example of
leveraging our technology is IADT online and really rolling that out. The IADT
online will be using the technology in the platform that AIU and CTU use. It is
showing that this is beginning to take hold in our other divisions.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jeffrey Silber <i>&#160;</i>-<i> BMO Capital Markets - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay, great. A
quick follow up on the CapEx. Under normalized basis, assuming no expansions,
what kind of maintenance expenditures or normalized CapEx should we expecting
as a percentage of revenue?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;We have always
said, and it varies a little bit by school, we have always talked about a 3% to
4% maintenance level, and I think when you look at the 2006 levels without any
significant new campus activity and without any significant expansion of
capacity within the existing schools we were within that range.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jeffrey Silber <i>&#160;</i>-<i> BMO Capital Markets - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you. That
is very helpful.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;You are
welcome.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;As a reminder,
ladies and gentlemen, due to time constraints please limit your questions to
one per person. Your next question comes from the line of Susie Stein with
Morgan Stanley. Please proceed, ma&#146;am.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Suzanne Stein <i>&#160;</i>-<i>
Morgan Stanley - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Hi. Can you
talk about your pricing strategy going forward? Are you considering any further
price reductions or do you think that is relatively stable at this point?</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;You know, we
have talked about that recently that we have undertaken a review of pricing. We
have made some adjustments. Last summer within AIU online associate degrees, we
talked about changes within the Gibbs segment and we have basically gotten
through those changes. Right now we don&#146;t believe that there will be any other
significant price changes. There is always going to be market considerations.
Nothing contemplated right now.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Stephen Fireng <i>&#160;</i>-<i> Career Education Corporation - Group President</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I think we are
still continuing to see our bachelors and our masters degree programs in
particular will still pay a premium for those. Our show rates and our
retentions and all of those particular programs continue to be strong. Then I
also think just really the financing options that Career Education affords to
the schools has allowed students to find a really affordable way. That is why
the students are important. They find an affordable way to go to school. I
think we provide really good options for our students.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Suzanne Stein <i>&#160;</i>-<i>
Morgan Stanley - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay, great.
Could you update us on any of the non-AIU legal and regulatory issues? Anything
new?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Patrick
Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;There is really
nothing new that we will add today. We will be filing our 10-K on or before
March 1. That will be our normal update when that is filed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Suzanne Stein <i>&#160;</i>-<i>
Morgan Stanley - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Thank
you.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;You are
welcome.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes from the line of Jerry Herman with Stifel Nicolaus. Please
proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jerry Herman <i>&#160;</i>-<i>
Stifel Nicolaus - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Good afternoon,
everybody. I promise to follow the rules here. Question about online and
specifically digging into CTU, with a population of 14%, it looks like that is
pushing almost 50% of the total pop in online. Your margins in mid-teens are
down from a year ago. I am wondering why you are not getting more leverage out
of that business, especially in light of the fact when AIU was about that level
their margins were substantially higher? Maybe you could talk about that a
little bit?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Stephen Fireng <i>&#160;</i>-<i> Career Education Corporation - Group President</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Yes, this is
Steve. There are two dynamics. One of the things, we rolled out I believe it
was a little over a year ago our Stonecliffe option to Colorado Tech.
Essentially, Colorado Tech did not have an associate degree option. Stonecliffe
was rolled out, which is at a lower price for our associate degree students,
and also had a part-time &#151; I guess the good and the bad with that is that is
continuing to grow. It has continued to match what the market is looking for.
Really what that is doing is growing our population but obviously as Pat
indicated earlier there is some RPS adjustments with that.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Jerry, to a
certain extent you had a little bit of a start up within a new school within an
existing one. That would change the dynamics a little bit. Secondly, it is a
slower paced program. Just some of the dynamics of lower revenue per student
relative to the administrative cost of dealing with them does not give you as
favorable of a profitability model.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Stephen Fireng <i>&#160;</i>-<i> Career Education Corporation - Group President</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;But I will say
with the growing population and being able to leverage our acquisition costs
and our start costs, CTU can still be a strong margin business. We look to see
that out of CTU online.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Jerry Herman <i>&#160;</i>-<i>
Stifel Nicolaus - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Great. Thank
you, guys.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes from the line of Mark Marostica with Piper Jaffray. Please
proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Mark Marostica <i>&#160;</i>-<i> Piper Jaffray - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Hey, thank you.
My question relates to the selling and marketing spend in the quarter. Can you
give us a sense of what the level of increase was? As you look out to the
coming quarters, do you expect that to accelerate or remain stable or
decelerate?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;On a
year-over-year basis, the admissions and marketing spend in total was
comparable year-over-year. There were really very, in total a kind of a very
modest increase year-over-year. Now as a percentage of revenue that was
certainly up significantly with the loss in population. In essence, with the
decline in size we have maintained spending. That is a conscious decision
really to make sure we are making the investment to really regenerate growth in
the population.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Mark Marostica <i>&#160;</i>-<i> Piper Jaffray - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Pat, by that
answer is it a correct assumption to state that that strategy will continue
going forward for the time being?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I think from a
spending perspective it is appropriate to look at that as a continuing focus. I
think probably one of the more important things is to look at how we&#146;re
spending those dollars, and we certainly have a number of initiatives we are
looking at at getting the most effectiveness out of that spend.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;This is Bob. We
don&#146;t really have a shortage of leads. What we were doing to some degree was
overwhelming ourselves with leads in a almost a helter-skelter pattern. What we&#146;ve
done is we have effectively readdressed our buying patterns to get ourselves,
they&#146;re called smart leads in the press release. But just better quality leads.
Ones that convert at a higher rate than wind up with a lower cost per start. So
I don&#146;t really see a great deal of additional spending in the advertising side
next year at all.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Mark Marostica <i>&#160;</i>-<i> Piper Jaffray - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;How much has
the increase in recourse loan limits that you implemented I think mid-year last
year selectively driven some of the improvement you&#146;ve seen in Healthcare and
Culinary? And as an add-on to that question, have you extended those financing
terms to students in the online category, as well?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;A couple
things. One, with respect to the recourse for Healthcare and Culinary, there
really wasn&#146;t much need to do so in Healthcare. The price points didn&#146;t really
require us to make much modification to dollars that were available. In
Culinary, it certainly did have an influence. I would tell you it is a piece of
some of the improvement. It is not a dominant portion of the year-over-year
change. With respect to extending it into other business units, we have done
that. Some of the things we think are opportunities in terms of improving our
College and Academy activity levels is a little more aggressive use of some of
those tools at the campus level.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;This is Bob
Dowdell. We are going to get more aggressive with this.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Mark Marostica <i>&#160;</i>-<i> Piper Jaffray - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Great. Thank
you. I&#146;ll turn it over.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes from the line of Gary Bisbee with Lehman Brothers. Please
proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Hi, guys. Good
afternoon. I guess the question is around any updates in the sales process. The
first piece of it is that you said you took a charge to write down the assets
for the value you think you will sell them for. Can you share with us what that
is? Secondly, given the big loss in the business last year is it realistic to
think you can get anything for them in the near term? Can you sell Gibbs with
New York state looking into that? Sorry, to ask a bunch of questions there.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Let&#146;s address a
couple of things. One, with respect to the operating loss level, we did in the
disclosures today try to provide supplemental information on the details within
the discontinued segment in terms of how much we are looking at in terms of
operating losses. The operating losses are down within the discontinued piece
versus prior levels, down versus the run rate we are at during the year, trends
within, particularly within Gibbs in terms of population have been improving,
year-over-year starts have been improving. So that is one piece of it.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Secondly, I did mention that we took a charge related
to accelerating lease cost for some unused space so essentially some of the
lease costs that have been contributing to the operating losses essentially get
removed from the mix on a go forward basis, so the buyer would not be picking
up the same level of responsibility in terms of occupancy expenses going
forward as what has been reflected in our historical numbers.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">And, third, I will tell you if you just basically in
terms of sales price when you get a chance to fully digest the numbers
essentially you will see carrying values in the financial statements associated
with assets and liabilities for discontinued operations. There is a schedule in
the back that shows a net asset value for discontinued ops, that roughly is
going to be looking at the sales price we would look at based on the write
downs that we have taken. I am sure I missed a piece of that.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Well, let me
put the other part, Gary. The write downs they took contemplated or they
recognized the existence of the issue in New York. They effectively dealt with
that in the evaluation. Gibbs is a good franchise. It had a great January
start. It&#146;s doing quite well. It doesn&#146;t necessarily fit our profile. But it is
a great franchise. The process is quite frankly going slower than I would like
it. I have that kind of a personality. We will have the book out in the next
week or two. Quite frankly, there is a lot of interest.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Just, Pat, the
$9 million or so you took in lease write downs. How much of that $100 million
liability you mentioned a few months ago would that have taken?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Well, the $100
million was kind of a broad number recognizing broad commitments, less concern
about, or not really reflected in there the ability to sublease space and
things like that. I don&#146;t have a precise number in front of me to do the math
for you, but let me suggest that I will take the question under advisement and
see if we can&#146;t provide a little color around that when we file our 10-K. The
other question, Gary, the one schedule of net assets for discontinued
operations shows about $35 million in terms of the net carrying value of those
assets. So essentially the write-off that we took is to bring the level down to
that $35 million. So it is implied that that would be the net proceeds from all
13 schools.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Gary, let me
add one other thing. We took a conservative position on how we booked all this
sort of thing. But we are still working with the New York State Department of
Education to resolve these issues, and so there is a strong argument that this
is a temporary issue rather than a permanent issue.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay, great.
Thanks for all the color.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next question
comes from the line of Trace Urdan with Signal Hill. Please proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Trace Urdan <i>&#160;</i>-<i>
Signal Hill Group LLC - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Hey, good
afternoon. I am wondering if you could describe for us what you see as the
principal causes initially for the declines in Culinary and Health segment and
then to what you attribute the pretty dramatic turn in starts that you reported
with this quarter?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Well, the
Culinary, probably one of the biggest ones is the pricing level. It really is.
It is not price in terms of the total price. It is the ability to make monthly
payments while you are in school in particular. Culinary is what we call a
destination school. It is very high profile and very high interest. It is
expensive and often times it is in expensive cities, too. So people relocate to
this.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Quite frankly, the compensity that was put on bad debt
expense and number of days in receivables and that sort of thing in my opinion
was pretty counter productive. It put the students in a position where they
couldn&#146;t get enough funding from enough sources to afford to stay in school, if
you will. We had a lot higher no show rate because as they came to the
realities of what they had to deal with they just could not come.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The extended payment plans, which we do on a selective
basis, but quite frankly given the margins and incremental costs and so on and
so forth, it is hard to make much of a case for not doing it. It helped a great
deal.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Quite frankly, we improved a lot of the other
marketing processes while we were doing this and they were ones that helped
both Culinary and Health. They happened to be both under Paul Ryan, so there
was a commonality of approach to those things. Some of the things I outlined
earlier are those things. So the belief is if you can apply it to Health and
Culinary you ought to be able to apply it to the rest of the businesses and
that is what we are going to do.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Trace Urdan <i>&#160;</i>-<i>
Signal Hill Group LLC - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;That is maybe
persuasive for the turn. It doesn&#146;t really provide an explanation for why
things went south to begin with because for a long time those segments were
growing nicely, even with those burdens you described, then they weren&#146;t, now
they are again. I am wondering what was the thing that caused them to stop
working?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Well, it is not
a complete answer but certainly the financing was part of it. If we go back a
few years, we were looking at significant investment in receivables, in terms
of DSOs. We were looking at higher bad debt levels. At the time, not
withstanding the fact that our overall performance was strong and growing it
was a significant issue with investors and analysts. We certainly swung the
pendulum the other direction with respect to credit process.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In addition to that when we look at some of the
developments early, last in 2006 and late in 2005 there were some externally
influenced changes from lenders that we deal with in terms of credit
parameters. As we talked about last year, our response to their changes was
probably not immediate enough and not strong enough to deal with the impact of
those changes on our students.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Trace Urdan <i>&#160;</i>-<i>
Signal Hill Group LLC - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. I
appreciate that. Thank you.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes from the line of Steven Barlow with Prudential Equity Group.
Please proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Steven Barlow <i>&#160;</i>-<i>
Prudential Equity Group - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you. Pat,
can you talk about any further real estate rationalization besides what you
needed to do with Gibbs?</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;We didn&#146;t talk
about it specifically in the release or otherwise, we actually have surveyed
all of our real estate. We actually have taken some more modest charges in the
continuing operations for some other unused space or excess space. We have
begun the process of marketing that space in terms of subleases.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We are also looking at other individual transactions
that may allow us to basically bring our space needs down in certain cases, not
our needs down, bring our usage down more aligned with actual student
population. This is something that is slow going deal by deal.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We will look as we renew leases to look at smaller
amounts of space. We will look at in terms of perhaps moving locations at the
expiration of a lease to really get more efficient with the renewals.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Steven Barlow <i>&#160;</i>-<i>
Prudential Equity Group - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;If you were
forced to put a number on all of those initiatives, obviously there are lots of
small ones, what would it be on an annual savings basis?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;If you look at
this, I would tell you our occupancy expenses we&#146;ve talked about them being up,
over the last couple of years, on the order of 200 to 300 basis points in excess
of levels that we have been at historically. Over time getting back to where we
were before, that is some pretty significant savings relative to our revenue
base.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;This would be
on the brick-and-mortar side. The University side does not have this kind of a
problem. Some of these leases are long-term. It will take awhile.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Steven Barlow <i>&#160;</i>-<i>
Prudential Equity Group - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you very
much.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes as a follow-up question from the line of Kelly Flynn with UBS.
Please proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thanks. Just
quickly, when you mentioned some of the improvements at AIU you mentioned
retention. I just wanted to confirm what you meant by that. Were you talking
about retention with the reps or actual student retention?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Stephen Fireng <i>&#160;</i>-<i> Career Education Corporation - Group President</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I talked about
both of them. We had an improvement year-over-year in our fourth quarter
retention at AIU online and we also had an improvement with our advisor
turnover in the fourth quarter year-over-year.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;The first thing
you were talking about was student retention.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay, and you&#146;re
saying that was a year-over-year improvement?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Stephen Fireng <i>&#160;</i>-<i> Career Education Corporation - Group President</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Yes.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;That is a
continuing trend, too.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;All right.
Great. I will leave it at that, thank you.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes as a follow-up question from the line of Gary Bisbee with Lehman
Brothers. Please proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Yes, hi. Just wanted
to clarify one thing. When you first gave some of the data last quarter about
what the continuing ops would look like versus the schools you are attempting
to sell. You gave us the first half of &#145;06 and then the third quarter. Are you
planning to give us Q1 and Q2 in a filing at some point so that we could have a
better basis from which to forecast &#145;07, and if you&#146;re not planning to would
you please consider doing so?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Gary, could you
be a little more specific as to what you&#146;re missing right now?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Maybe you put
it in a filing and I missed it, but on your last press release a quarter ago my
sense was that you gave us the first half of &#145;06 numbers from continuing ops
restated and then you gave us the third quarter number. Or maybe not restated
from continuing ops. You gave us what the losses were from the Gibbs division
and from the other colleges so we could back into what the pro forma.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation- CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Gary, I think
that information is included within the schedules that we attached to the
release.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;This one today
or the last one?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;This one today.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I saw revenues
and operating profit but not the face of the P&amp;L.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay, okay, so
you are looking for the more detailed P&amp;L for this.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Yes.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Yes, let me. I
hear you. Let me do what I said before and take it under advisement here. We
have provided kind of that revenue segment profit, margin, number of starts and
student population for all of the last two years.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Then
sneak one more in. I think I heard you say you still thought you were on track
to essentially name the CEO by the end of the first quarter. Can you give us
any general update on that? Thank you.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Probably no
more than what I said. We expect to have it done by the end of the first
quarter and that is not very far away.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;You have
already chosen someone or are you still interviewing several people at this
point?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Let&#146;s just wait
until the end of the first quarter.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Gary Bisbee <i>&#160;</i>-<i>
Lehman Brothers - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay, all
right. Thanks.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Your next
question comes as a follow-up question from the line of Trace Urdan with Signal
Hill. Please proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Trace Urdan <i>&#160;</i>-<i>
Signal Hill Group LLC - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Bob, some of
the streamlining you talked about in terms of eliminating layers of management
and pushing decision making down to the campus level sort of runs counter to
the trend of the last couple of years which seems to be putting more and more
controls in place in an effort to get your arms around the regulatory issues or
at least maybe to satisfy external criticism. How do you respond to that?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;We really didn&#146;t
change much of anything on the control environment. It was really much more in
the operational side of the business.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Trace Urdan <i>&#160;</i>-<i>
Signal Hill Group LLC - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Are you a
candidate for CEO, Bob?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;[LAUGHTER] Let&#146;s
wait until the end of March.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Trace Urdan <i>&#160;</i>-<i>
Signal Hill Group LLC - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I presume that
is a compliment, and I thank you for it.</font></p>

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<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;And your final
question comes as a follow-up question from the line of Kelly Flynn with UBS.
Please proceed.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I&#146;m so sorry.
This is my third question. On bad debt can you tell us why it was so low? I
know you don&#146;t want to give guidance, but any color on whether or not there are
one-offs in there or do we expect it to be that low going forward?</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Patrick Pesch <i>&#160;</i>-<i>
Career Education Corporation - CFO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;I would say
historically bad debt has varied by quarter. If we go back a couple of years we
went through a change in our allowance methodology, which is a very formula
driven approach based on historical collection experience and some movements in
the receivables etc. will influence that on quarter-by-quarter basis.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">What I would look at for 2007, I would, looking at one
quarter is never going to give you a good overall measure. I would look at the
selective performance during 2006. I would actually expect our bad debt levels
to rise during 2007 consistent with some of the changes we are making in terms
of extension of credit.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I would not expect it to go up in any kind of
uncontrolled fashion as we&#146;ve got very specific programs that we are using for
that extension of credit, and in a manner of measuring reserve requirements
related to those receivables that should keep us pretty current on reserve
requirements. The one thing I would tell you within that context is some rise
in bad debt won&#146;t necessarily be a bad thing in terms of revenue growth
performance and bottom line performance.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Kelly, if I
could build on that a little bit. I am sure you understand this, but I will say
it anyway. In a business like this where you have a fair amount of excess
capacity and you have students that can&#146;t afford the whole ticket price,
particularly on a month-by-month basis. This focus on bad debt is in my opinion
hopelessly over blown. The idea of maybe 3% or 4% or 5% when your incremental
cost to the student is 25%. It is just counter productive.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">I think the whole industry has really gotten too
intense on one side of an equation. The difference between 3% and 5% is 2%. The
difference between 25% and 100% is 75%. A lot of times the industry is
effectively giving up the 75 points for 2 or 3. I would really hope we keep our
controls, we keep our business discipline and that sort of thing, but this
extended payment plan puts more credit risk out there. It is a measured bet. It
is pretty hard to lose on it. I would, quite frankly, as a businessman hope the
bad debt rate would go up because we&#146;re probably not taking advantage of our
situation if it doesn&#146;t.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Kelly Flynn <i>&#160;</i>-<i>
UBS - Analyst</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Fair
enough. Thank you so much.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;There are no
further questions in queue at this time. I would now like to turn the call over
to Mr. Dowdell for closing remarks. Please proceed, sir.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&#160;Robert Dowdell <i>&#160;</i>-<i> Career Education Corporation - Interim President,
CEO</i></font></b></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Okay. Thank you
very much for your time and for your questions. Again, I will tell you I think
we probably will see some real improvement in the business. It is obviously
seeing is believing. These things, if they are going to come to be you&#146;ll see
them in the future. We certainly are working hard on them. We have a great team
here.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We have really reorganized ourselves to be far more
effective, I&#146;d say flexible, but the more effective is really important to me.
Just to reiterate something. We are going to stay compliant. We are going to
stay absolutely focused on compliance.</font></p>

<p style="margin:0pt 0pt 12.0pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">We are not going to give up any ground to the things
we have achieved in that whole area. We would be kind of crazy on that. And Pat
said that maybe I confused somebody. I&#146;m not a candidate for the CEO. So I just
want to make that clear. I appreciate your time. Keep your eye on us. I think
we&#146;re going to do some great things. So thank you much.</font></p>

<p style="margin:4.0pt 0pt 12.0pt;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Operator</font></b></p>

<p style="margin:0pt 0pt .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;Thank you for your attendance in
today&#146;s conference. This concludes the presentation. You may now disconnect.
Good day.</font></p>

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