Follow-on File-to-Offer Discounts. IPO Pricing vs. Initial Filing Range. Education Equity Capital Markets Weekly Update September 4, 2012

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1 Education Equity Capital Markets Weekly Update September 4, 01 Piper Jaffray Contacts Kevin Jakuc Inv. Banking Andrew Gormley Inv. Banking Joel Schneider Capital Markets Diana Chen Capital Markets Return (%) 40% 0% 0% 10% 0% (10%) (0%) (0%) S&P Nasdaq Education Week (0%) (0%) (0%) 01 YTD 1% 18% (4%) Equity Market Performance Equity Offering Activity All Sectors YTD # Offerings Cap Raised ($B) % Change # $ IPOs $.0 $. (8%) 4% Follow-ons 4 $10.0 $ % 4% Converts 44 $1. $. 41% 4% Total $14. $16.6 (%) (10%) Activity Summary Last week, no IPOs or follow-ons priced. This week, no IPOs or follow-ons are on the calendar. (40%) (0%) Jan Feb Mar AprMay Jun Jul Aug Sep Oct NovDec Jan Feb Mar AprMay Jun Jul Aug IPO Pricing vs. Initial Filing Range Follow-on File-to-Offer Discounts # of IPOs 0 Below Within Above FTO (%) 0% (%) Sep Oct Nov Dec Jan Feb Mar Apr May June July Aug (4%) (6%) (8%) (10%) (1%) (%) (%) (%) (%) (6%) (%) (%) (%) (%) (8%) (9%) (11%) Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Monthly Equity Fund Flows ($B) Weekly Education Headlines Capital Flows ($ Billions) $0 $1 $10 $ $0 ($) ($) ($) $1 $8 $ $0 $14 ($0) New Mexico Virtual Academy (NMVA), a new statewide online public charter school authorized by Farmington School District, will open a new blended learning center in Farmington designed to meet the individual needs of students and to expand digital learning opportunities. ($10) ($1) ($) ($11) ($6) ($0) ($) ($0) ($6) Sep Oct Nov Dec Jan Feb Mar Apr May June July Aug Data as of 8/1/1; Includes all deals greater than $0 million Source: Dealogic, CapIQ & amgdata.com Education universe consists of all companies tracked on page Education index calculated as equal-weighted

2 Public Company Market Performance and Valuation Education Services () Stock Performance % of Week Market Enterprise LTM EV/ LTM EV/ EBITDA Price / Earnings LT EPS PEG Price Week YTD LTM High Low Cap. Value Revenue Revenue LTM LTM Growth LTM Online Education Post-Secondary American Public Education, Inc. $.0 1% (%) (16%) % 1% $600 $48 $91 1.x 6.4x 6.x.x 14.9x 1.0x 1.x 18% 0.8x 0.9x 0.x Bridgepoint Education, Inc. $9.86 (1%) (%) (%) 6% 1% $1 $181 $91 0.x NM NM NM.x.8x 4.8x 1% 0.x 0.x 0.x Capella Education Co. $1.0 (%) (14%) 1% 68% 10% $40 $84 $48 0.x.x.1x.1x 9.6x 10.8x 10.x 1% 0.6x 0.x 0.x Grand Canyon Education, Inc. $1.1 % % 40% 9% 10% $91 $9 $48.0x 8.1x.0x 6.1x 16.0x 1.0x 1.x 18% 0.9x 0.9x 0.8x Median (0%) (18%) (%) 0% 19% $61 $8 $44 1.x 6.4x 6.x.x 1.x 1.9x 11.4x 16% 0.x 0.8x 0.x Mean (0%) (1%) (%) 68% 1% $60 $468 $ 1.1x 6.0x.x 4.8x 10.9x 11.1x 10.x 16% 0.x 0.x 0.6x Traditional Post-Secondary Education Apollo Group Inc. $6.8 (1%) (0%) (4%) 46% 104% $,044 $,66 $4, x.x.0x.4x 6.x 8.1x 8.8x 1% 0.x 0.6x 0.x Career Education Corp. $.1 (9%) (60%) (80%) 18% 10% $1 ($18) $1,61 NM NM NM NM 6.1x NM NM 1% 0.x NA NA Corinthian Colleges Inc. $.0 (8%) (%) % 9% 16% $1 $49 $1,60 0.x.0x 1.x 1.6x 6.6x.8x.9x 10% 0.x 0.6x 0.6x DeVry, Inc. $19.1 % (0%) (%) 41% 106% $1,8 $1,00 $,090 0.x.x.6x.6x 6.8x 8.4x 9.6x 1% 0.x 0.x 0.8x Education Management Corporation $.99 (10%) (89%) (81%) 10% 10% $ $1,8 $,61 0.6x.x 4.x 4.x.x 4.8x.9x 1% 0.x 0.4x 0.x ITT Educational Services Inc. $.01 % (44%) (4%) 4% 10% $46 $9 $1,401 0.x 1.6x.0x.4x.x.9x 4.x 10% 0.x 0.4x 0.4x Lincoln Educational Services Corporation $4. (1%) (46%) (4%) 44% 14% $9 $11 $444 0.x.0x 4.8x.0x 4.0x NM 4.6x 11%.1x NA.xx National American University Holdings, Inc. $4.06 (1%) (46%) (1%) 44% 11% $104 $84 $119 0.x 6.4x.6x.0x 0.x.0x 11.x 0% 1.0x 1.1x 0.6x Strayer Education Inc. $64.8 (%) (%) (9%) 4% 101% $41 $9 $8 1.x 4.x.x.8x 8.4x 11.1x 11.x 1% 0.6x 0.9x 0.9x Universal Technical Institute, Inc. $1.01 1% (6%) (16%) 9% 110% $9 $0 $44 0.x 4.8x.x 4.6x 19.0x 1.0x.0x 11% 1.x.8x.x Median (1%) (46%) (%) 4% 106% $ $489 $1,0 0.x.0x 4.x.6x 6.x 8.x 9.6x 1% 0.6x 0.x 0.x Mean (%) (4%) (46%) 4% 114% $0 $41 $1,0 0.6x.x 4.0x.8x 11.x 1.0x 11.9x 1% 0.9x 0.9x 1.0x Post-Secondary Software / Service Providers Higher One Holdings, Inc. $1. % % % 60% 19% $698 $61 $18.6x 10.x 9.0x.x 19.x 1.9x 1.0x 0% 1.0x 0.8x 0.x QuinStreet, Inc. $8. % (8%) (4%) 68% 110% $66 $69 $0 1.0x 6.x.x.0x.x 1.6x 9.8x 1%.0x 1.1x 0.8x Median % (%) (11%) 64% 119% $ $0 $9.x 8.x.x 6.x.4x 14.x 11.4x 16% 1.x 0.9x 0.x Mean % (%) (11%) 64% 119% $ $0 $9.x 8 8.x.x 6 6.x.4x 14.x 11.4x 16% 1 1.x x 0 0.x K-1 K1, Inc. $1.0 (%) 1% (1%) % 1% $4 $688 $ x 10.8x.x.4x NM.x 4.4x 0% NA 1.9x 1.x Pearson plc $11.9 (%) (1%) % 9% 11% $9,8 $10,9 $, x 10.6x 10.1x 9.4x 1.x 14.0x 1.0x 6%.x.4x.x Education Holdings 1, Inc. $0.0 0% (80%) (90%) 9% 8% $1 $14 $ x 1.9x NA NA NM NA NA NA NA NA NA Scientific Learning Corp. $1.0 (1%) (9%) (64%) 9% 11% $4 $1 $ 0.6x NM NA NA NM NA NA NA NA NA NA Scholastic Corporation $0. 1% % 14% 6% 16% $964 $98 $,149 0.x 4.0x 4.0x 4.6x 8.0x 8.x 11.1x 1% 0.x 0.6x 0.x School Specialty Inc. $.8 6% 1% (69%) 0% 11% $4 $411 $08 0.6x 10.4x 8.x.8x NM NM NM NA NA NA NA Smart Technologies Inc. $1.4 (1%) (91%) (91%) % 141% $18 $81 $18 0.x 4.0x 4.6x.6x 9.x.x.6x % 0.4x 0.x 0.1x Median (1%) (1%) (64%) 0% 16% $18 $411 $08 0.6x 10.x.x.4x 9.x 11.4x 1.1x 18% 0.x 1.x 1.0x Mean 0% (9%) (4%) 46% 141% $1,6 $1,94 $1, 0.8x 8.8x 6.9x 6.x 1.9x 16.4x 1.1x 16% 1.x 1.x 1.1x International Ambow Education Holding Ltd. $.4 (%) (6%) (6%) 41% 18% $4 $1 $1, 0.1x NM NM NM.x 1.4x 0.8x % 0.1x 0.1x 0.0x ATA, Inc. $4.6 (0%) (4%) (4%) 4% 141% $100 ($16) $6 NM NM NM NA.x 10.x NA % 0.1x 0.4x NA China Distance Education Holdings Limited $.0 (%) 9% % % 168% $10 $4 $48 1.0x 8.x.9x NA.0x 10.9x NA 0% 1.9x 0.x NA ChinaCast Education Corporation $0.64 (%) (90%) (8%) 10% 1% $ ($8) $648 NM NM NM NA 0.x 0.9x NA NA NA NA NA ChinaEdu Corporation $.8 0% 1% (%) % 144% $9 ($10) $48 NM NM NM NM 1.x 14.4x 1.9x 1% 0.1x 1.x 1.1x New Oriental Education & Technology Group $1.90 (1%) (4%) (4%) 40% 148% $,11 $1,1 $ 1.8x 10.1x.6x 6.x 4.0x 1.8x 9.8x 4% 1.0x 0.x 0.4x TAL Education Group $.0 (1%) (%) (%) 9% 108% $81 $ $ x 11.9x 1.6x 8.x.x 18.x 1.6x 4% 1.x 0.8x 0.6x Median (%) (4%) (4%) 4% 148% $10 $4 $48 1.4x 10.1x.6x.4x.x 10.9x 11.x 4% 0.6x 0.x 0.x Mean (%) (%) (%) 49% 0% $4 $1 $60 1.x 10.1x 8.4x.4x 14.x 9.9x 9.8x % 0.8x 0.6x 0.x Corporate Training Educational Development Corporation $.9 % (1%) (4%) 69% 10% $16 $1 $ 0.x 6.1x NA NA 10.x 1.0x NA NA NA NA NA Franklin Covey Co. $10. (1%) % 11% 96% 166% $184 $11 $164 1.x 11.0x.9x 6.x.4x 4.x 1.x 8% 1.0x 0.9x 0.6x GP Strategies Corp. $0.0 1% 49% 0% 9% 19% $80 $4 $9 1.0x 9.x 8.6x.8x 18.x 1.8x 16.0x 16% 1.1x 1.1x 1.0x Informa plc $4.0 0% 1% 1% 90% 10% $,44 $,9 $1,60.6x 9.x 8.9x 8.x.9x 10.x 9.x 6%.9x 1.x 1.6x Learning Tree International Inc. $4.10 (0%) (40%) (4%) 4% 10% $4 $14 $11 0.1x.0x NM NA NM NM NA NA NA NA NA Rosetta Stone, Inc. $11.1 (1%) 1% (11%) 8% 16% $4 $1 $ 0.4x NM 1.8x.x NM NM NM 1% NA NA NA Median 0% 1% (0%) 84% 148% $1 $166 $0 0.8x 9.x 8.8x.x 1.1x 16.4x 16.0x 16% 1.1x 1.1x 1.0x Mean 0% 1% 0% 9% 10% $4 $61 $ 1.0x.x 10.8x.x 0.0x 16.9x 14.4x 16%.0x 1.x 1.1x Median (1%) (%) (4%) 44% 14% $66 $ $8 0.6x 6.x.x.0x 8.8x 10.9x 11.1x 1% 0.6x 0.x 0.x Mean (1%) (8%) (%) 0% 11% $88 $806 $1,18 0.9x 6.x 6.x.x 1.1x 1.x 11.4x 16% 1.0x 0.9x 0.8x Source: CapitalIQ, Thomson One Analytics and Bloomberg; Data as of 8/1/1 Note: All projected financials adjusted to calendar year figures and exclude stock-based compensation

3 Broader Market Equity Offering Activity ii Pricings 1, Week of August, 01 No deals priced Filings, Week of August, 01 Filing Deal Deal Expected Date Issuer Type Value Date Sector Business Description 8/1/1 Alon USA Partners LP IPO $0 TBA Energy & Mining Petroleum refinery 8/0/1 Taylor & Martin Group Inc IPO $1 TBA Financial Auction and liquidation services of pre-owned capital assets 8/0/1 Workday Inc IPO $400 TBA Technology Cloud-based applications for human capital and employee expense management 8/9/1 Amira Nature Foods Ltd IPO $100 TBA Consumer Provider of packaged Indian specialty rice 8/8/1 Lifelock Inc IPO $1 TBA Technology Identity theft protection company 8/8/1 ExactTarget Inc Follow-on $100 TBA Technology Provider of on-demand marketing software solutions Offering Calendar, Expected During or After Week of September 4, 01 No deals in the offering calendar Source: Dealogic Includes deals priced and/or filed after 8//1 greater than $0 million *Denotes deals on which Piper served as manager Please see disclosures on last page for 1, &

4 Education Sector Equity Offering Activity i Since 010 Pricings 1, Pricing Deal Filing Offer Deal Market Deal Value / % Pricing Performance Date Issuer Type Ticker Range Price Value Value Market Value Secondary FTO 1-Day 0-Day Current 11/1/10 Xueda Education Group IPO XUE $ $9.0 $14 $68 % 0% 1% % 8% (69%) 10/19/10 TAL Education Group* IPO XRS $ $10.00 $18 $4 19% 0% 11% 0% 6% (%) 10//10 Global Education & Technology Group* IPO GEDU $ $10.0 $ $66 9% 0% 11% 16% (%) % 8/4/10 Ambow Education Holdings Ltd IPO AMBO $ $10.00 $10 $1 1% 0% (9%) (8%) (6%) (6%) 1/10/10 Lincoln Educational Services Corp Follow-on LINC $ $1. $60 $64 16% 100% (%) (0%) % (%) /6/10 National American University Holdings Follow-on NAUH $ $.0 $60 $8 6% 0% (%) % % (46%) 4/1/10 Princeton Review Inc Follow-on REVU $ $.00 $48 $166 9% 0% (14%) 14% (8%) (100%) /1/10 Lincoln Educational Services Corp Follow-on LINC $ $.0 $ $68 11% 100% (4%) (1%) (1%) (8%) Filings, Filing Deal Deal Expected Date Issuer Type Value Date Business Description 1//09 Language Line Services Holdings* IPO $400 TBA Provider of on-demand language translation services. Education YTD Offering Activity # Offerings Cap Raised ($M) % Change # $ IPOs 0 0 $0 $0 NA NA Follow-ons 0 0 $0 $0 NA NA Converts 0 0 $0 $0 NA NA Total 0 0 $0 $0 NA NA Source: Dealogic Includes deals priced and/or filed after 1/1/10 greater than $0 million *Denotes deals on which Piper served as manager Please see disclosures on last page for 1, &

5 Disclaimer i (1) Pricings This shall not constitute an offer to sell or the solicitation of an offer to buy any of these securities. These securities having been sold, this announcement appears as a matter of record only. () Filings A registration statement relating to these securities has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. () For deals on which Piper Jaffray will (has) serve(d) as manager A written prospectus may be obtained by contacting Heather Humbert at Piper Jaffray Member SIPC and NYSE