QuickLinks -- Click here to rapidly navigate through this document

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.            )

Filed by the Registrant ý

Filed by a Party other than the Registrant o

Check the appropriate box:

o
 
Preliminary Proxy Statement

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

ý
 
Definitive Proxy Statement

o
 
Definitive Additional Materials

o
 
Soliciting Material Pursuant to §240.14a-12

WHITMAN EDUCATION GROUP, INC.
(Name of Registrant as Specified In Its Charter)

    
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

ý
 
No fee required

o
 
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11
    (1)   Title of each class of securities to which transaction applies:
        
    (2)   Aggregate number of securities to which transaction applies:
        
    (3)   Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
        
    (4)   Proposed maximum aggregate value of transaction:
        
    (5)   Total fee paid:
        

o
 
Fee paid previously with preliminary materials.

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

 
 
(1)
 
Amount Previously Paid:
        
    (2)   Form, Schedule or Registration Statement No.:
        
    (3)   Filing Party:
        
    (4)   Date Filed:        
LOGO   LOGO
PROXY STATEMENT   PROSPECTUS

The Proposed Career Education/Whitman Education Merger—Your Vote is Important

Dear Fellow Whitman Shareholder:

        Career Education Corporation and Whitman Education Group, Inc. have agreed on a merger transaction whereby CEC will acquire Whitman. If we complete the merger, Whitman will become a wholly-owned subsidiary of CEC and you will receive $6.00 in cash and shares of CEC common stock valued at approximately $8.25 for each share of Whitman common stock you own. The value of the CEC common stock component of the per share merger consideration is subject to adjustment if the average closing price of CEC common stock during a period prior to the closing of the merger is outside of a specified range of prices as described in this proxy statement/prospectus. The exact number of shares of CEC common stock that you will receive will be determined by the merger's exchange ratio, which is also based on the average closing price of CEC common stock during the pricing period.

        CEC's shares are traded on the Nasdaq National Market under the symbol "CECO." As of May 29, 2003, the closing sales price of CEC's common stock was $60.27.

        We cannot complete the merger without the approval of Whitman's shareholders. We have scheduled a special meeting of Whitman shareholders to obtain this approval. The special meeting will be held at Whitman's executive offices located at 4400 Biscayne Boulevard, 14th Floor, Miami, Florida 33137 on July 1, 2003 at 10:00 a.m., local time. Whether or not you plan to attend, please take the time to vote by completing and mailing the enclosed proxy card to us.

        This proxy statement/prospectus provides you with detailed information about the merger and the special meeting. Please read this entire document carefully, including the section entitled "Risk Factors" beginning on page 18 that discusses the potential risks involved in the merger, the operation of the combined company and owning CEC common stock.

        The board of directors of Whitman has unanimously approved the merger agreement and believes that the merger is in the best interests of Whitman's shareholders and Whitman. The Whitman board therefore unanimously recommends that you vote in favor of the proposal to approve the merger agreement.

  Sincerely yours,


 


/s/ Richard C. Pfenniger
  Richard C. Pfenniger, Jr.
 Vice-Chairman of the Board and Chief Executive Officer

        Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the merger or the CEC common stock to be issued in the merger or determined that this proxy statement/prospectus is accurate or adequate. Any representation to the contrary is a criminal offense.

        This proxy statement/prospectus is dated May 30, 2003 and is first being mailed to Whitman shareholders on or about June 2, 2003.

LOGO

4400 Biscayne Boulevard
Miami, Florida 33137

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD JULY 1, 2003

To the Shareholders of WHITMAN EDUCATION GROUP, INC.:

        Whitman will hold a special meeting of the shareholders of Whitman Education Group, Inc. at Whitman's executive offices located at 4400 Biscayne Boulevard, 14th Floor, Miami, Florida 33137, on July 1, 2003 at 10:00 a.m., local time, for the following purposes:


        The board of directors of Whitman unanimously recommends that Whitman shareholders vote for the approval of the merger agreement.

        Shareholders of record at the close of business on May 23, 2003 are entitled to notice of, and to vote at, the special meeting and any adjournment or postponement of the special meeting. A list of those shareholders will be available at the special meeting and will also be available for inspection by shareholders of record during normal business hours at our corporate headquarters for 10 days prior to the special meeting. Approval of the merger agreement requires the affirmative vote of a majority of the Whitman common stock outstanding as of the record date.

        All shareholders are cordially invited to attend the special meeting. It is important that your shares be represented at the special meeting, whether or not you plan to attend in person. Accordingly, please complete, sign, date and return the enclosed proxy card in the enclosed envelope, which requires no postage if mailed in the United States. If your shares are held in the name of a broker, bank or other fiduciary, you should direct that person how to vote your shares and bring proof of your share ownership if you wish to attend the special meeting. You may revoke your proxy in the manner described in the accompanying proxy statement/prospectus at any time before the proxy has been voted at the special meeting. Please note that if you abstain, do not vote or do not instruct your fiduciary how to vote any shares that it holds for you in its name, this will have the same effect as a vote against the approval of the merger agreement.


        You should not send Whitman stock certificates with your proxy card. After we complete the merger, the exchange/paying agent will send you written instructions for exchanging Whitman stock certificates for CEC stock certificates and cash.

  By order of the Board of Directors,


 


/s/ Fernando L. Fernandez
  Fernando L. Fernandez
 Chief Financial Officer and Corporate Secretary
Miami, Florida
May 30, 2003		  

TABLE OF CONTENTS

QUESTIONS AND ANSWERS ABOUT THE MERGER   1

SUMMARY
 
3
  The Companies   3
  Our Reasons for the Merger   3
  Recommendation of the Whitman Board   4
  Opinion of Whitman's Financial Advisor   4
  The Special Meeting   4
  The Merger   4

SELECTED HISTORICAL FINANCIAL DATA OF CEC
 
10

SELECTED HISTORICAL FINANCIAL DATA OF WHITMAN
 
12

UNAUDITED SELECTED PRO FORMA CONDENSED COMBINED FINANCIAL DATA
OF CEC AND WHITMAN
 
13

COMPARATIVE PER SHARE DATA
 
15

COMPARATIVE MARKET PRICE DATA
 
16

RISK FACTORS
 
18
  Risk Factors Related to the Merger   18
  Risk Factors Related to the Combined Business and Owning CEC Common Stock   20

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
 
28

THE WHITMAN SPECIAL MEETING
 
29
  Date, Time and Place of the Special Meeting   29
  Purpose of the Special Meeting   29
  Record Date and Outstanding Shares; Voting Rights   29
  Quorum; Required Votes; Abstentions and Broker Non-Votes   29
  Proxies; Revocability of Proxies   30
  Solicitation of Proxies   30

THE MERGER
 
31
  Structure of the Merger   31
  Background of the Merger   31
  Whitman's Reasons for the Merger   35
  CEC's Reasons for the Merger   37
  Opinion of Financial Advisor to Whitman   37
  Merger Consideration   44
  Treatment of Outstanding Whitman Stock Options   46
  Termination of Whitman Employee Stock Purchase Plan   46
  Payoff of Whitman Term Loan and Credit Facility   46
  Interests of Whitman Directors and Executive Officers in the Merger   46
  Accounting Treatment   47
  Material Federal Income Tax Consequences   47
  Regulatory Matters   49
  Appraisal Rights   50
     

i


THE MERGER AGREEMENT
 
51
  Whitman Stock Certificate Exchange Procedures   51
  Directors and Officers of Whitman after the Merger   51
  Representations and Warranties   51
  Covenants   52
  Conditions to the Merger   55
  Termination, Termination Fee, Amendment and Waiver   56

THE VOTING AGREEMENT
 
58

INFORMATION ABOUT OUR COMPANIES
 
59
 
CEC
 
59
  Whitman   59

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS OF CEC AND WHITMAN
 
60

COMPARISON OF RIGHTS OF STOCKHOLDERS OF CEC AND SHAREHOLDERS OF WHITMAN
 
68

WHERE YOU CAN FIND MORE INFORMATION
 
76

EXPERTS
 
77

LEGAL MATTERS
 
77

FUTURE SHAREHOLDER PROPOSALS
 
77
LIST OF ANNEXES:        
  Annex A   Agreement and Plan of Merger    
  Annex B   Opinion of Legg Mason Walker Wood, Incorporated    

ii

ADDITIONAL INFORMATION

        This proxy statement/prospectus incorporates important business and financial information about CEC and Whitman that is not included in, or delivered with, this proxy statement/prospectus.

        CEC will provide you with copies of this information relating to CEC, without charge, upon written or oral request to:

  Career Education Corporation
2895 Greenspoint Parkway, Suite 600
Hoffman Estates, Illinois 60195
Attention: Investor Relations Department
Telephone Number: (847) 585-3899		  

        Whitman will provide you with copies of this information relating to Whitman, without charge, upon written or oral request to:

  Whitman Education Group, Inc.
4400 Biscayne Boulevard
Miami, Florida 33137
Attention: Corporate Secretary
Telephone Number: (800) 445-6108		  

        In order to receive timely delivery of these documents in advance of the Whitman special meeting, you should make your request no later than June 24, 2003, which is five business days before the date of the special meeting.

        For a more detailed discussion about the information about CEC and Whitman incorporated into this proxy statement/prospectus, see "Where You Can Find More Information" beginning on page 76.

        CEC has supplied all information contained or incorporated by reference in this proxy statement/prospectus relating to CEC, and Whitman has supplied all information contained or incorporated by reference in this proxy statement/prospectus relating to Whitman.

        You should rely only on information contained or incorporated by reference in this proxy statement/prospectus to vote on the merger proposal. We have not authorized anyone to provide you with information that is different from what is contained or incorporated by reference in this proxy statement/prospectus. You should not assume that the information contained in this proxy statement/prospectus is accurate as of any date other than the date on the cover of this proxy statement/prospectus or, in the case of documents incorporated by reference, the date of the referenced document, and neither the mailing of this proxy statement/prospectus to you nor the issuance of CEC common stock in connection with the merger shall create any implication to the contrary.

        In this proxy statement/prospectus, all references to CEC common stock include the associated right to purchase CEC series A preferred stock under CEC's stockholders' rights plan.

iii



QUESTIONS AND ANSWERS ABOUT THE MERGER

Q1:
Why am I receiving this proxy statement/prospectus?

A1:
You are receiving these materials in connection with Whitman's solicitation of proxies for its special meeting of shareholders to be held on July 1, 2003. At the special meeting, you will be asked to vote upon a proposed merger transaction between Whitman, CEC and a wholly-owned subsidiary of CEC. This document is also CEC's prospectus for the shares of CEC common stock that it will issue in the merger.

Q2:
When do you expect to complete the merger?

A2:
We are working toward completing the merger as quickly as possible after the special meeting and, therefore, hope to complete the merger in early July 2003. However, in addition to obtaining Whitman shareholder approval, we must also obtain regulatory approvals and satisfy other conditions before we can complete the merger. Therefore, we cannot predict exactly when we will complete the merger.

Q3:
What should I do now in order to vote on the merger?

A3:
After carefully reading and considering the information contained and incorporated by reference in this proxy statement/prospectus, you should vote your Whitman shares by mailing your completed, dated and signed proxy card to Whitman in the enclosed postage paid envelope as soon as possible so that your shares will be represented at the special meeting. If you abstain from voting or do not vote, it will have the same effect as voting against the merger proposal.

Q4:
If my Whitman shares are held in "street name" by my broker, will my broker vote my shares for me?

A4:
If you do not provide your broker with instructions on how to vote your shares, your shares will not be voted by your broker, which will have the same effect as voting against the proposed merger. You should follow the directions provided by your broker regarding how to instruct your broker to vote your shares. You should also bring proof of your share ownership if you wish to attend the special meeting.

Q5:
Can I change my vote?

A5:
If you are a shareholder of record, you can change your vote in one of the following ways at any time before your proxy is voted at the special meeting:

•
by written notice to the corporate secretary of Whitman, stating that you would like to revoke your proxy;

•
by completing, signing and submitting a new, later-dated proxy card; or

•
by attending the special meeting and voting in person.
Q6:
Should I send in my Whitman stock certificates now?

A6:
You should not send in your Whitman stock certificates now. After we complete the merger, the exchange/paying agent, Computershare Trust Co. of New York, will send you written instructions for exchanging your Whitman stock certificates for CEC stock certificates and cash.

Q7:
What if I receive more than one proxy card?

A7:
This may mean that your Whitman shares are registered in different ways or are in more than one account. Please provide voting instructions for all proxy cards you receive to ensure that all of your Whitman shares are voted at the special meeting.
Q8:
What if I have additional questions?

A8:
If you have questions about the merger, the special meeting or where to send your proxy, or if you would like additional copies of this proxy statement/prospectus, you should contact one of the following:

Georgeson Shareholder Communications, Inc.
17 State Street
New York, NY 10004
Telephone Number: (800) 964-0728

Whitman Education Group, Inc.
4400 Biscayne Boulevard
Miami, Florida 33137
Attention: Fernando Fernandez
Telephone Number: (800) 445-6108

2


SUMMARY

        This summary highlights selected information from this proxy statement/prospectus and does not contain all of the information that is important to you. To understand the merger fully and for a more complete description of the legal terms of the merger, you should read carefully this entire document, including the documents attached as annexes, and the documents incorporated by reference. See "Where You Can Find More Information" on page 76. We have included page references parenthetically to direct you to more complete descriptions of the topics presented in this summary.

The Companies

        CEC is a provider of private, for-profit post-secondary education with 51 campuses throughout the United States, Canada, France, the United Kingdom and the United Arab Emirates. CEC also offers online programs through American InterContinental University-Online, its e-learning division. As of April 30, 2003, CEC's student population was approximately 54,400.

        Whitman is a proprietary provider of career-oriented post-secondary education. Through three wholly-owned subsidiaries, Whitman currently operates 22 schools in 13 states offering a range of graduate, undergraduate and non-degree certificate or diploma programs primarily in the fields of information technology, healthcare and business. As of April 30, 2003, Whitman's student population was approximately 10,000.

Our Reasons for the Merger (page 35)

        The merger presents an opportunity for Whitman shareholders to realize a significant premium over recent market prices for their shares prior to announcement of the merger. The merger also allows the shareholders of Whitman to benefit from owning part of a larger and financially stronger enterprise with greater geographical coverage in the United States and internationally, and a significantly more liquid stock, while also receiving some cash for their shares. Whitman believes the merger will enable Whitman to benefit from CEC's resources and attract a broader student market and expand Whitman's educational program offerings.

        From CEC's perspective, the merger furthers its strategy to invest in growth opportunities while creating operating efficiencies through economies of scale by acquiring schools that CEC believes will benefit from the implementation of its business, operating and marketing strategy. For example, CEC believes that the merger will strengthen CEC's health and online educational programs. The merger will also expand CEC's geographic presence to include new major markets in the United States. CEC expects the merger to open new opportunities for it to offer a wider range of credential options to meet the needs of a broader student population and to enhance the competitive position of its business and CEC's overall strength in the private, post-secondary education market.

        Achieving these anticipated benefits of the merger, however, is subject to risks discussed in "Risk Factors" beginning on page 18.

3


Recommendation of the Whitman Board (page 35)

        The Whitman board of directors has unanimously determined that the merger is in the best interests of Whitman's shareholders and Whitman and approved the merger agreement. The Whitman board of directors therefore unanimously recommends that you vote "FOR" the approval of the merger agreement.

Opinion of Whitman's Financial Advisor (page 37)

        Legg Mason Walker Wood, Incorporated, as financial advisor to the Whitman board of directors, has delivered its written opinion to the Whitman board of directors that, as of March 26, 2003 and based upon and subject to the various qualifications and assumptions described therein, the consideration of $14.25 per share ($6.00 per share in cash and $8.25 per share in CEC common stock), subject to adjustment under the terms of the merger agreement, to be received by Whitman shareholders in the merger was fair from a financial point of view to the Whitman shareholders. The full text of the opinion of Legg Mason is attached as Annex B to this proxy statement/prospectus. We encourage you to read the Legg Mason opinion carefully in its entirety. Legg Mason's opinion is directed to the Whitman board of directors and does not constitute a recommendation to any Whitman shareholder as to how to vote in connection with the merger.

The Special Meeting

        The special meeting will be held at Whitman's executive offices located at 4400 Biscayne Boulevard, 14th Floor, Miami, Florida 33137, on July 1, 2003 at 10:00 a.m., local time. At the special meeting, Whitman shareholders will be asked to approve the merger agreement.

        You are entitled to vote at the special meeting if you owned Whitman shares as of the close of business on the record date of May 23, 2003. On the record date, there were approximately 15,445,115 shares of Whitman common stock outstanding and entitled to vote at the special meeting. Shareholders will have one vote at the special meeting for each share of Whitman common stock they owned on the record date.

        The affirmative vote of a majority of the shares of Whitman common stock outstanding as of the record date is required to approve the merger. As of the record date, Whitman directors and executive officers had voting power with respect to approximately 27.4% of the outstanding shares of Whitman common stock. Phillip Frost, Whitman's chairman of the board, and a trust of which he is sole trustee, Richard Pfenniger, Jr., Whitman's chief executive officer and vice-chairman of the board, and Fernando Fernandez, Whitman's chief financial officer, have entered into a voting agreement with CEC in which they have agreed to vote the Whitman shares for which they have voting power in favor of the merger. These shares represent approximately 27.1% of the shares of Whitman common stock outstanding as of the record date. The remaining directors and executive officers of Whitman have expressed an intention to vote the Whitman shares for which they have voting power in favor of the merger agreement.

The Merger (page 31)

        The merger agreement is attached as Annex A to this proxy statement/prospectus. We encourage you to read the merger agreement because it is the legal document that governs the merger. If the holders of a majority of the shares of Whitman common stock outstanding as of the record date approve the merger agreement and all other conditions to the merger are satisfied or waived, Whitman

4


will merge into Marlin Acquisition Corp., a wholly-owned subsidiary of CEC, and Whitman's separate corporate existence will cease. As a result, Marlin Acquisition Corp. will continue as a wholly-owned subsidiary of CEC.

        If we complete the merger, we will exchange each outstanding share of Whitman common stock for $6.00 in cash and a to-be-determined number of shares of CEC common stock. The value of the CEC common stock component will be approximately $8.25, but is subject to adjustment. The value of CEC common stock to be issued in exchange for each share of Whitman common stock will be determined based upon the average closing price of CEC common stock on the Nasdaq National Market for the 20-day trading period ending on, and including, the second trading day prior to the day of the closing of the merger. In addition to $6.00 in cash, if the average closing price of CEC common stock for the pricing period is:

The exact number of shares of CEC common stock that you will receive will be determined by the merger exchange ratio. The exchange ratio is (1) the value of the CEC common stock to be issued in the merger per share of Whitman common stock (as determined by reference to the average closing price of CEC common stock during the pricing period) divided by (2) the average closing price of CEC common stock during the pricing period, unless the exchange ratio is fixed as shown in the table below. Instead of issuing fractional shares, CEC will pay cash for fractional shares based on the average closing price of CEC common stock during the pricing period. The following table shows how we will adjust the value or number of shares of CEC common stock that you receive for each of your shares of Whitman common stock, based upon the average closing price of CEC common stock reported on the Nasdaq National Market during the pricing period.

Average Closing Price of CEC Common Stock
During the Pricing Period
   Value/Number of Shares of CEC Common Stock
per Share of Whitman Common Stock
Less than $37.00(1)   Number of shares based on a fixed exchange ratio of 0.204
At least $37.00, but less than $44.00   Valued at $8.25 less $0.10 per dollar that the average closing price during the pricing period is below $44.00, subject to proportionate adjustment for fractions of a dollar
At least $44.00, but less than $58.00   Valued at $8.25
At least $58.00, but no more than $65.00   Valued at $8.25 plus $0.10 per dollar that the average closing price during the pricing period is above $58.00, subject to adjustment for fractions of a dollar
Greater than $65.00(2)   Number of shares based on a fixed exchange ratio of 0.138
(1)
If the average closing price of CEC common stock during the pricing period is less than $37.00, Whitman has the option to terminate the merger agreement unless CEC agrees to issue CEC common stock valued at $7.55 for each share of Whitman common stock.

(2)
If the average closing price of CEC common stock during the pricing period is greater than $65.00, CEC has the option to terminate the merger agreement unless Whitman agrees to have CEC issue common stock valued at $8.95 for each share of Whitman common stock.

5

        Example 1: If you hold 100 shares of Whitman common stock and the average closing price of CEC common stock during the pricing period is $48.00, you will receive $600 plus 17 shares of CEC common stock (based on an exchange ratio equal to 8.25/48). In addition, you will receive a cash payment of $9.60 in lieu of the 0.2 shares of CEC common stock that you would have otherwise received.

        Example 2: If you hold 100 shares of Whitman common stock and the average closing price of CEC common stock during the pricing period is $40.00, you will receive $600 plus 19 shares of CEC common stock (based on an exchange ratio equal to 7.85/40). In addition, you will receive a cash payment of $24.00 in lieu of the 0.6 shares of CEC common stock that you would have otherwise received.

        Example 3: If you hold 100 shares of Whitman common stock and the average closing price of CEC common stock during the pricing period is $60.00, you will receive $600 plus 14 shares of CEC common stock (based on an exchange ratio equal to 8.45/60). In addition, you will receive a cash payment of $6.00 in lieu of the 0.1 shares of CEC common stock that you would have otherwise received.

        We expect the market price of CEC common stock to fluctuate prior to the merger. Therefore, the average closing price of CEC common stock during the pricing period may be higher or lower than the closing price of CEC common stock on the date of the merger agreement and the date of the Whitman special meeting. In addition, because the exchange ratio is fixed two trading days before the closing of the merger, the value of the CEC common stock that you will receive in the merger may increase or decrease before the date we complete the merger. You should obtain current stock price quotations for CEC common stock prior to voting on the merger.

        Based upon 15,445,115 shares of Whitman common stock outstanding as of May 23, 2003 and an assumed exchange ratio of 0.141, which is based on an average closing market price of CEC common stock during the 20 consecutive trading days ended May 23, 2003 of $59.87, CEC will issue an aggregate of approximately 2,177,761 shares of CEC common stock in the merger to the holders of these shares of Whitman common stock. Based upon the 46,698,278 shares of CEC common stock outstanding as of May 23, 2003, the holders of these shares of Whitman common stock collectively will hold approximately 4.5% of the shares of CEC common stock outstanding immediately after the merger.

        CEC expects to borrow under its $200 million credit facility the funds necessary to pay the cash consideration payable to Whitman's shareholders and option holders in the merger.

        Each outstanding option to purchase Whitman common stock, whether vested or unvested, will be cancelled upon consummation of the merger and exchanged for cash equal to the positive difference, if any, between (1) the value, in cash, of the per share merger consideration (with the portion payable in CEC common stock being valued as of the second trading day prior to the closing of the merger) and (2) the per share exercise price of the option. This cash value of the per share merger consideration will adjust in the same manner as the value of the CEC common stock component of the per share merger consideration payable to Whitman shareholders.

        The completion of the merger depends on the satisfaction or waiver of a number of conditions, including the following:

6

        CEC and Whitman may agree to terminate the merger agreement at any time before completing the merger. In addition, either party may terminate the merger agreement (1) if the merger is not completed by September 26, 2003 through no fault of the terminating party, (2) if Whitman shareholders do not approve the merger agreement or (3) in certain other circumstances.

        CEC may also terminate the merger agreement if:

        Whitman may also terminate the merger agreement if the average closing market price of CEC common stock during the pricing period is less than $37.00 unless CEC agrees to issue CEC common stock valued at $7.55 for each share of Whitman common stock.

        Whitman must pay CEC a fee of $10 million, plus up to $1.5 million of CEC's costs and expenses in connection with the merger, if the merger agreement is terminated because:

7


        The merger agreement provides that Whitman will not, and will not permit its directors, officers, employees or other representatives and agents to:

        Any violation of these solicitation restrictions may result in CEC having the ability to terminate the merger agreement and receive termination fees as described above. However, if Whitman receives an unsolicited third-party acquisition proposal that the Whitman board of directors determines in good faith is or could be superior to the terms of the merger with CEC, Whitman is permitted, subject to additional limitations, to furnish information about its business to the third party and engage in discussions and negotiations with the third party.

        When you consider the recommendation of the Whitman board of directors that you vote in favor of the merger, you should be aware that a number of Whitman directors and executive officers have interests in the merger that may be different from, or in addition to, yours. These interests include:

8

        Whitman shareholders are not entitled to dissenters' or appraisal rights under the Florida Business Corporation Act in connection with the merger.

        The merger is intended to qualify as a reorganization within the meaning of Section 368 of the Internal Revenue Code of 1986. Accordingly, no gain or loss will be recognized by Whitman shareholders with respect to the CEC common stock received in exchange for Whitman common stock; however, gain, if any, will be recognized with respect to the cash portion of the merger consideration. In addition, gain or loss will be recognized with respect to cash received in lieu of fractional shares.

        Tax matters are very complicated, and the tax consequences of the merger to you will depend on the facts of your particular situation. You are urged to consult your own tax advisor as to the specific tax consequences to you of the merger, including the applicable federal, state, local and foreign tax consequences.

        CEC will record the merger using the purchase method of accounting in accordance with U.S. generally accepted accounting principles. This means that for financial reporting purposes, CEC will treat both companies as one company beginning as of the date we complete the merger. In addition, under this method of financial reporting, CEC will record the fair value of Whitman's net assets on its consolidated financial statements, with the remaining purchase price in excess of the fair value of Whitman's net assets recorded as goodwill.

        CEC and Whitman have made filings and taken other actions, and will continue to make filings and take actions, necessary to obtain approvals from all appropriate governmental and educational authorities in connection with the merger. Regulatory approvals required to complete the merger include approval of a substantial number of the state authorizing agencies and accrediting agencies that currently approve and accredit the Whitman schools and their educational programs. In addition, after closing the merger, we will need to obtain approval from the U.S. Department of Education for each of the Whitman schools to continue to participate in the U.S. federal student financial aid programs administered by the Department of Education.

        When the merger is completed, you will become a stockholder of CEC. Unlike Whitman, which is a Florida corporation, CEC is a Delaware corporation, and the certificate of incorporation and bylaws of CEC differ from the articles of incorporation and bylaws of Whitman. In addition, CEC has a stockholders' rights plan that entitles holders of its common stock, in certain instances, to purchase shares of CEC series A preferred stock. As a result, you will have different rights as a CEC stockholder than you currently have as a Whitman shareholder.

9


SELECTED HISTORICAL FINANCIAL DATA OF CEC

        We are providing the following CEC selected historical consolidated financial information to aid you in your analysis of the financial aspects of the merger. The following information is only a summary and should be read together with CEC's consolidated audited and unaudited financial statements, the related notes and the discussion under "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in CEC's Annual Report on Form 10-K/A for its fiscal year ended December 31, 2002 and CEC's Quarterly Report on Form 10-Q for its fiscal quarter ended March 31, 2003, which are incorporated by reference in this proxy statement/prospectus. See "Where You Can Find More Information" on page 76. CEC derived its consolidated statement of income data for the fiscal years ended December 31, 2002, 2001 and 2000 and its consolidated balance sheet data as of December 31, 2002 and 2001 from its audited consolidated financial statements that are incorporated by reference in this proxy statement/prospectus. CEC derived its consolidated statement of income data for the fiscal years ended December 31, 1999 and 1998 and its consolidated balance sheet data as of December 31, 2000, 1999 and 1998 from its audited consolidated financial statements that are not incorporated by reference in this proxy statement/prospectus. CEC's consolidated financial statements for fiscal year 2002 were audited by Ernst & Young LLP, independent auditors, and CEC's consolidated financial statements for fiscal years 2001, 2000, 1999 and 1998 were audited by Arthur Andersen LLP, independent certified public accountants. CEC derived its consolidated statement of income data for the three month periods ended March 31, 2003 and 2002 and its consolidated balance sheet data as of March 31, 2003 from its unaudited consolidated financial statements that are incorporated by reference in this proxy statement/prospectus. In the opinion of CEC's management, these unaudited consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the information when read along with the audited financial statements and the related notes. CEC's operating results for the three months ended March 31, 2003 are not necessarily indicative of the results CEC will achieve for the entire year ending December 31, 2003.

 
   For the three months ended March 31,
   For the year ended December 31,
 
   2003
   2002
   2002
   2001
   2000
   1999
   1998
 
   (unaudited)

   (In thousands, except per share data)
Consolidated Statement of Income Data:                                          
Total revenue   $ 245,543   $ 176,286   $ 780,059   $ 547,059   $ 334,528   $ 223,501   $ 149,215
Total operating expenses     214,604     156,563     666,761     478,237     295,148     203,150     140,114
   
 
 
 
 
 
 

Income from operations
 
 
30,939
 
 
19,723
 
 
113,298
 
 
68,822
 
 
39,380
 
 
20,351
 
 
9,101

Net income
 
$
19,226
 
$
11,965
 
$
67,472
 
$
38,355
 
$
21,406
 
$
10,943
 
$
4,296
   
 
 
 
 
 
 

Net income per share attributable to common stockholders:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Basic   $ 0.42   $ 0.27   $ 1.49   $ 0.88   $ 0.57   $ 0.36   $ 0.07
   
 
 
 
 
 
 
 
Diluted
 
$
0.40
 
$
0.26
 
$
1.42
 
$
0.85
 
$
0.55
 
$
0.34
 
$
0.07
   
 
 
 
 
 
 

 
 
 
 
December 31,
 
   March 31,
2003
 
   2002
   2001
   2000
   1999
   1998
 
   (unaudited)

    
   (In thousands)

    
    

Consolidated Balance Sheet Data:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents   $ 27,139   $ 33,474   $ 39,675   $ 33,742   $ 44,745   $ 23,548
Working capital (deficit)     11,338     (10,964 )   10,221     29,316     25,787     15,994
Total assets     620,174     586,136     490,789     280,699     210,524     132,887
Total debt     31,058     32,769     89,922     19,120     49,939     22,617
Total stockholders' equity     431,534     405,697     306,405     200,893     113,681     84,636

10

        CEC considers accreditation, licensing and Title IV participation rights acquired in a business combination to be intangible assets that have indefinite lives and, therefore, in accordance with Financial Accounting Standards Board's (FASB) Statement of Financial Accounting Standard No. 142, Goodwill and Other Intangible Assets, such assets are not subject to amortization. As such, CEC reviews these non-amortizable intangible assets for impairment on at least an annual basis by applying a fair-value based test. See Note 3 and Note 7 to CEC's consolidated financial statements included in its Annual Report on Form 10-K/A for the fiscal year ended December 31, 2002, which is incorporated by reference herein, for additional disclosure regarding these intangible assets. During May 2003, the Emerging Issues Task Force (EITF) of the FASB added the following to its inventory of open issues for discussion at future EITF meetings: Issue No. 03-H, "Evaluating Evidence to Support Renewal or Extension When Determining the Useful Life and Estimating the Fair Value of a Recognized Intangible Asset." The EITF's conclusion on Issue No. 03-H could affect CEC's accounting for accreditation, licensing and Title IV participation rights acquired in business combinations whereby CEC may treat these acquired assets as amortizable intangible assets and, therefore, amortize the fair value of these acquired intangible assets over their useful lives, which would increase CEC's total operating expenses for the applicable fiscal periods and require CEC to review the assets for impairment whenever events or circumstances indicate that the carrying amount may not be recoverable. If the EITF's conclusion causes CEC to treat these assets as amortizable intangible assets, the EITF will determine the related manner in which CEC would transition to that accounting treatment.

11


SELECTED HISTORICAL FINANCIAL DATA OF WHITMAN

        We are providing the following Whitman selected consolidated financial information to aid you in your analysis of the financial aspects of the merger. The following information is only a summary and should be read together with Whitman's audited and unaudited consolidated financial statements, the related notes and the discussion contained in "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in Whitman's Annual Report on Form 10-K for its fiscal year ended March 31, 2003, which is incorporated by reference in this proxy statement/prospectus. See "Where You Can Find More Information" on page 76. Whitman derived its consolidated statement of operations data for the fiscal years ended March 31, 2003, 2002 and 2001 and its consolidated balance sheet data as of March 31, 2003 and 2002 from its audited consolidated financial statements that are incorporated by reference in this proxy statement/prospectus. Whitman derived its consolidated statement of operations data for the fiscal years ended March 31, 2000 and 1999 and its consolidated balance sheet data as of March 31, 2001, 2000 and 1999 from its audited consolidated financial statements that are not incorporated by reference in this proxy statement/prospectus. The consolidated financial statements as of March 31, 2003, 2002, 2001, 2000 and 1999 and for each of the years then ended were audited by Ernst & Young LLP, independent certified public accountants.

 
   For the year ended March 31,
 
   2003
   2002
   2001
   2000
   1999
 
   (In thousands, except per share data)(1)
Consolidated Statement of Operations Data:                        
Net revenues   $ 109,796   $ 91,927   $ 79,629   $ 77,611   $ 73,977
Total costs and expenses     96,885     86,867     79,053     77,637     69,782
   
 
 
 
 
Income (loss) from operations     12,911     5,060     576     (27 )   4,194
Net income (loss)   $ 7,511   $ 2,602   $ (1,422 ) $ (502 ) $ 3,042
   
 
 
 
 

Net income (loss) per share attributable to common shareholders
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
 
$
0.53
 
$
0.19
 
$
(0.11
)
$
(0.04
)
$
0.23
   
 
 
 
 
 
Diluted
 
$
0.49
 
$
0.18
 
$
(0.11
)
$
(0.04
)
$
0.22
   
 
 
 
 

 
 
March 31,
 
   2003
   2002
   2001
   2000
   1999
 
   (In thousands)

Consolidated Balance Sheet Data:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total assets   $ 81,771   $ 67,075   $ 62,867   $ 62,526   $ 62,580
Long-term debt and capitalized lease obligations, less current portion     4,710     7,473     11,128     11,119     12,022
Shareholders' equity     34,261     23,727     20,544     21,285     21,625
(1)
Amounts reflect Whitman's acquisition of Huron University on December 30, 1996, which was accounted for as a purchase, Whitman's sale of Huron University in August 1999 and Whitman's disposition of its minority interest in Huron University in April 2001.

12


UNAUDITED SELECTED PRO FORMA CONDENSED COMBINED
FINANCIAL DATA OF CEC AND WHITMAN

        The following unaudited selected pro forma condensed combined statement of income data for the three months ended March 31, 2003 and the year ended December 31, 2002 gives effect to the proposed merger of CEC and Whitman as if the merger had occurred on January 1, 2002. The following unaudited selected pro forma condensed combined balance sheet data as of March 31, 2003 gives effect to the merger as if it had occurred on March 31, 2003. The unaudited selected pro forma condensed combined financial data was prepared from (1) CEC's audited historical consolidated financial statements for the year ended December 31, 2002 and unaudited historical consolidated financial statements as of, and for the three months ended, March 31, 2003 and (2) Whitman's audited historical consolidated financial statements as of, and for the year ended, March 31, 2003 and unaudited historical condensed consolidated financial statements for the nine months ended December 31, 2002.

        CEC and Whitman have different fiscal year-end dates. The unaudited selected pro forma condensed combined statement of income data for the year ended December 31, 2002, CEC's most recently completed fiscal year, reflects Whitman's historical statement of income data for the twelve months ended March 31, 2003, which is Whitman's most recently completed fiscal year. Whitman's historical results of operations for the three months ended March 31, 2003 is included in the unaudited pro forma condensed combined statement of income data for both the three months ended March 31, 2003 and the year ended December 31, 2002.

        The unaudited selected pro forma condensed combined financial data includes all adjustments necessary for a fair presentation of the data and, in the opinion of management, has been prepared on the same basis as that of the underlying audited financial statements. The unaudited selected pro forma condensed combined financial data is a presentation of historical results with accounting adjustments necessary to reflect the estimated pro forma effect of the merger on the combined financial position and results of operations of CEC and Whitman. The unaudited selected pro forma condensed combined financial data does not reflect the effects of any anticipated changes to be made by CEC to the historical operations, is presented for information purposes only, and should not be construed to be indicative of combined results of operations or financial position that actually would have occurred had the merger of CEC and Whitman been consummated as of the date indicated or the combined entity's future results of operations or financial position.

        The unaudited selected pro forma condensed combined balance sheet data has been prepared using the purchase method of accounting for the proposed merger. The acquired assets and assumed liabilities of Whitman are stated in the unaudited selected pro forma condensed combined balance sheet data at amounts representing an allocation of the purchase price based upon a preliminary estimate of the fair values of the acquired tangible and intangible assets and assumed liabilities at the assumed March 31, 2003 acquisition date.

        The unaudited selected pro forma condensed combined financial data is based upon the financial condition and operating results of Whitman during periods when it was not under the control, influence or management of CEC. The information presented may not be indicative of the results of operations that would have actually occurred had the acquisition been completed as of January 1, 2002, nor is it necessarily indicative of the future financial condition or operating results of the combined entity. CEC expects to incur reorganization and integration expenses and experience operating efficiencies as a result of its acquisition of Whitman. The unaudited selected pro forma condensed combined financial data does not give effect to these expenses or any synergies that may occur due to the integration of Whitman with CEC and should be read along with the historical financial statements of CEC and Whitman and the related notes incorporated by reference in this proxy statement/prospectus.

13

UNAUDITED SELECTED PRO FORMA CONDENSED COMBINED
FINANCIAL DATA OF CEC AND WHITMAN

 
   For the three months ended March 31, 2003
 
   CEC
   Whitman
   Pro Forma
Adjustments
   Pro Forma Combined
 
   (In thousands, except per share data)
Pro Forma Combined Statement of Income Data:                        
Total revenue   $ 245,543   $ 30,070   $ —   $ 275,613
Total operating expenses     214,604     25,330     (464 )   239,470
   
 
 
 
Income from operations     30,939     4,740     464     36,143
Net income   $ 19,226   $ 2,821   $ (538 ) $ 21,509
   
 
 
 
Net income per share attributable to common stockholders:                        
  Basic   $ 0.42   $ 0.19         $ 0.45
   
 
       
  Diluted   $ 0.40   $ 0.17         $ 0.43
   
 
       

 
 
For the year ended December 31, 2002
 
   CEC
   Whitman(1)
   Pro Forma
Adjustments
   Pro Forma Combined
 
   (In thousands, except per share data)
Pro Forma Combined Statement of Income Data:                        
Total revenue   $ 780,059   $ 109,796   $ —   $ 889,855
Total operating expenses     666,761     96,885     751     764,397
   
 
 
 
Income from operations     113,298     12,911     (751 )   125,458
Net income   $ 67,472   $ 7,511   $ (3,543 ) $ 71,440
   
 
 
 
Net income per share attributable to common stockholders:                        
  Basic   $ 1.49   $ 0.53         $ 1.50
   
 
       
  Diluted   $ 1.42   $ 0.49         $ 1.44
   
 
       

 
 
March 31, 2003
 
   CEC
   Whitman
   Pro Forma
Adjustments
   Pro Forma Combined
 
   (In thousands)
Pro Forma Combined Balance Sheet Data:                        
Cash and cash equivalents   $ 27,139   $ 25,215   $ —   $ 52,354
Working capital (deficit)     11,338     18,044     (2,480 )   26,902
Total assets     620,174     81,771     228,763     930,708
Total debt     31,058     7,233     119,709     158,000
Total stockholders' equity     431,534     34,261     96,095     561,890
(1)
Whitman's historical statement of income data is for the twelve months ended March 31, 2003, which is Whitman's most recently completed fiscal year.

14


COMPARATIVE PER SHARE DATA

        We have summarized below certain:

The unaudited pro forma combined per share data assumes an exchange ratio of 0.141 shares of CEC common stock for each outstanding share of Whitman common stock. We have based this exchange ratio on the average closing price of CEC common stock on the Nasdaq National Market during the 20 consecutive trading days ended May 23, 2003. You should note that this exchange ratio, and thus the amount of CEC common stock to be issued in the merger, may decrease or increase depending on the trading prices of CEC common stock during the pricing period prior to the merger.

        You should read this data along with the selected historical financial data for CEC and Whitman included in this proxy statement/prospectus and the historical consolidated financial statements of CEC and Whitman and the related notes incorporated by reference in this proxy statement/prospectus. The unaudited pro forma data does not necessarily indicate the results of operations that actually would have been achieved had we been a single entity during 2002 or the first three months of 2003, nor does it necessarily indicate the results of operations we will obtain in the future as a combined entity.

 
   As of, and for the three months ended,
March 31, 2003
   As of, and for the year ended,
December 31, 2002(1)
HISTORICAL PER SHARE DATA            
Net income from continuing operations per common share:            
  Basic:            
    CEC   $ 0.42   $ 1.49
    Whitman     0.19     0.53
  Diluted:            
    CEC     0.40     1.42
    Whitman     0.17     0.49

Book value per common share(2):
 
 
 
 
 
 
    CEC     9.33     8.81
    Whitman     2.33     2.33

PRO FORMA PER SHARE DATA
 
 
 
 
 
 
Pro forma combined net income from continuing operations per common share:            
  Basic:            
    Per CEC share   $ 0.45   $ 1.50
    Per equivalent Whitman share(3)     0.06     0.21
  Diluted:            
    Per CEC share     0.43     1.44
    Per equivalent Whitman share(3)     0.06     0.20

Pro forma combined book value per share(4):
 
 
 
 
 
 
    Per CEC share     11.60     11.12
    Per equivalent Whitman share(3)     1.64     1.57
(1)
Whitman historical per share data is as of, and for the twelve months ended, March 31, 2003, which is Whitman's most recent fiscal year-end date.

(2)
Historical book value per share is computed by dividing stockholders' equity by the number of shares of common stock outstanding.

(3)
The unaudited equivalent Whitman per share amounts are calculated by multiplying the unaudited combined pro forma per CEC share amounts by the assumed exchange ratio of 0.141 shares of CEC common stock for each outstanding share of Whitman common stock.

(4)
Pro forma combined book value per share is computed by dividing pro forma stockholders' equity by the number of shares of CEC common stock outstanding plus the number of shares of CEC common stock assumed to be issued in the merger.

15


COMPARATIVE MARKET PRICE DATA

        Shares of CEC common stock trade on the Nasdaq National Market under the symbol "CECO." Shares of Whitman common stock trade on the American Stock Exchange under the symbol "WIX." The following table presents the closing market prices for CEC common stock and Whitman common stock on March 26, 2003, the last full trading day prior to the announcement of the signing of the merger agreement, and May 29, 2003, the last practicable trading day for which information was available prior to the date of the printing of this proxy statement/prospectus. The table also presents the equivalent price per share of Whitman common stock as of those dates, which is equal to the value of CEC common stock that a Whitman shareholder would have received for one share of Whitman common stock if the merger had taken place on those dates. We calculated these equivalent numbers by multiplying the closing market price per share of CEC common stock on these dates by an assumed exchange ratio of 0.141, and adding the per share cash payment of $6.00. We have based this exchange ratio on the average closing price of CEC common stock on the Nasdaq National Market during the 20 consecutive trading days ended May 23, 2003. You should note that this exchange ratio may decrease or increase depending on the trading prices of CEC common stock during the pricing period prior to the merger and the actual value of CEC common stock that a Whitman shareholder will receive upon completion of the merger may be higher or lower than the prices below. As a result, you should obtain current market quotations for CEC common stock and Whitman common stock before making any decision about the merger.

 
   CEC
Common Stock
   Whitman
Common Stock
   Whitman
Equivalent Per
Share Price
March 26, 2003   $ 50.97   $ 10.22   $ 14.25
May 29, 2003     60.27     14.48     14.44

        We have also included the following tables to show the range of high and low quarterly sales prices reported on the Nasdaq National Market for CEC common stock and reported on the American Stock Exchange for Whitman common stock for the periods indicated:

 
   CEC*
 
   High
   Low
Fiscal Year Ending December 31, 2003            
  Second Quarter (through May 29, 2003)   $ 62.44   $ 49.05
  First Quarter     51.55     38.05

Fiscal Year Ended December 31, 2002
 
 
 
 
 
 
  Fourth Quarter     52.50     36.80
  Third Quarter     48.65     33.01
  Second Quarter     48.21     38.00
  First Quarter     40.23     30.00

Fiscal Year Ended December 31, 2001
 
 
 
 
 
 
  Fourth Quarter     36.52     22.87
  Third Quarter     33.61     21.69
  Second Quarter     30.68     22.72
  First Quarter     25.63     15.47
*
All prices have been adjusted to reflect a 2-for-1 stock split affected by CEC in September 2001.

16

 
   Whitman
 
   High
   Low
Fiscal Year Ending March 31, 2004            
  First Quarter (through May 29, 2003)   $ 14.58   $ 13.58

Fiscal Year Ended March 31, 2003
 
 
 
 
 
 
  Fourth Quarter     13.95     6.45
  Third Quarter     7.75     5.20
  Second Quarter     6.22     4.28
  First Quarter     7.00     5.00

Fiscal Year Ended March 31, 2002
 
 
 
 
 
 
  Fourth Quarter     5.92     4.40
  Third Quarter     4.80     3.00
  Second Quarter     3.70     2.75
  First Quarter     3.05     2.00

        Neither CEC nor Whitman has ever paid any cash dividends on its stock. We anticipate that our combined enterprise, for the foreseeable future, will retain any earnings for use in the operation of our business. Therefore, we do not anticipate paying cash dividends in the foreseeable future.

17



RISK FACTORS

        In determining whether you should vote in favor of the merger and acquire CEC common stock, you should consider carefully, in addition to the other information contained or incorporated by reference in this proxy statement/prospectus, the following risks associated with the merger, the combined entity following the merger and ownership of CEC common stock following the merger. References to "we," "us" and "our" refer to the combined CEC/Whitman entity following completion of the merger.

Risk Factors Related to the Merger

        Upon completion of the merger, Whitman shareholders will receive cash and shares of CEC common stock for each share of Whitman common stock that they own. The value and number of shares of CEC common stock to be received by Whitman shareholders will be based on the average closing price of CEC common stock during the 20-day pricing period ending on the second day prior to the completion of the merger. We expect the market price of CEC common stock to fluctuate prior to the completion of the merger. Therefore, the average closing price of CEC common stock during the pricing period may be higher or lower than the closing price of CEC common stock on the date of the merger agreement, the date of the Whitman special meeting or the date we complete the merger. Changes in the market price of CEC common stock prior to the merger may affect the value, and will affect the number, of shares of CEC common stock that you receive in the merger. You may not receive $8.25 in CEC common stock for each of your shares of Whitman common stock. The price of CEC common stock may fluctuate because of various factors, including:

In addition, although Whitman has the right to terminate the merger agreement if the average closing price of CEC common stock during the pricing period is less than $37.00, Whitman may elect not to terminate the merger agreement under these circumstances. In this case, you could receive shares of CEC common stock valued at less than $7.55 per share of Whitman common stock.

        Among the factors we considered in connection with our decision to pursue the merger was the opportunity to realize synergies and efficiencies through the merger. In order to obtain the benefits of those synergies and efficiencies, we must successfully integrate Whitman and CEC. If we cannot integrate CEC and Whitman efficiently, promptly, successfully or at all, we may not realize the anticipated benefits of the merger. Key elements of Whitman's businesses that need to be integrated into CEC's network of schools include:

18

The successful combination of the two independent companies will require significant effort, managerial resources, time and expense on the part of CEC and Whitman. The integration process will be further complicated by the need to integrate geographically dispersed operations, multiple schools and different corporate cultures. The dedication of management and other personnel to the integration process may distract these individuals' attention from the conduct of day-to-day business activities. This distraction, along with employees' uncertainty about their role in the combined company and lack of employee focus due to the distractions of the merger, may disrupt our operations. Although we expect that the elimination of duplicative costs and realization of other efficiencies related to the integration will at least offset the transaction-related costs over time, we may not be able to realize a net benefit from the merger in the near term or at all.

        The success of combining Whitman with CEC will depend upon the retention of educational personnel and administrators who are critical to the continued advancement, development and support of Whitman's schools. CEC may not be able to retain key educational personnel and administrators of Whitman before or after the merger. The loss of the services of any significant group of educational personnel and administrators of Whitman could negatively affect CEC's ability to successfully integrate Whitman's operations. As often occurs with mergers, during the pre-merger and integration phases, competitors may intensify their efforts to recruit educational personnel and administrators. Employee uncertainty regarding the effects of the merger could also cause increased turnover.

        The merger agreement prohibits Whitman from initiating or encouraging, and limits Whitman's ability to respond to, inquiries with respect to alternative acquisition proposals. These provisions limit Whitman's ability to pursue offers from other possible acquirors. Whitman must pay CEC a termination fee of $10 million, plus up to $1.5 million of CEC's costs and expenses, if the merger agreement terminates under certain circumstances, including in connection with an acquisition proposal from a third party. The termination fee could discourage another company from making a competing takeover proposal that could be more advantageous to Whitman's shareholders because this fee may make the competing proposal more difficult or expensive and could deter Whitman from entering into an alternative transaction. Whitman is not presently aware of any competing proposal.

        Upon the completion of the merger, holders of Whitman common stock will become holders of CEC common stock. CEC's business differs from that of Whitman, and CEC's results of operations, as well as the price of CEC's common stock, may be affected by factors different from those affecting Whitman's results of operations and the price of Whitman stock before the merger. For a discussion of CEC's and Whitman's respective businesses, see CEC's Annual Report on Form 10-K/A for the fiscal year ended December 31, 2002 and Whitman's Annual Report on Form 10-K for the fiscal year ended March 31, 2003, which are incorporated by reference in this proxy statement/prospectus. See "Where You Can Find More Information" on page 76.

19

        Some of Whitman's executive officers and directors have interests in the merger that are different from, or in addition to, interests of Whitman shareholders. These interests, which include indemnification, extension of directors and officers' liability insurance, severance payments and cashing out of vested and unvested options, could have affected the decision of these persons to support or approve the merger.

        If the merger is not completed for any reason, the price of Whitman's common stock may fall significantly to the extent the current market price reflects an assumption that the merger will be completed. In addition, significant merger-related costs incurred by Whitman, including legal, accounting and financial advisory fees, must be paid by Whitman if we do not complete the merger.

        Whitman's shareholders presently have the power to approve or reject any matter requiring the approval of shareholders under Florida law and Whitman's articles of incorporation. Immediately after the merger, Whitman's shareholders, in the aggregate, will hold approximately 4.5% of the outstanding shares of CEC common stock. Even if all of the former Whitman shareholders voted in concert on all matters presented to CEC's stockholders, this number of CEC shares, without a substantial number of other holders of CEC common stock voting the same way, will not affect the outcome of proposals voted upon by the stockholders of CEC.

Risk Factors Related to the Combined Business and Owning CEC Common Stock

        We derive a significant portion of our revenue from U.S. federal student financial aid programs administered by the U.S. Department of Education. To participate in these programs, a U.S. institution must obtain and maintain authorization by the appropriate state agencies, accreditation by an accrediting agency recognized by the Department of Education and certification by the Department of Education. As a result, our U.S. schools are subject to extensive regulation by these agencies. These regulations cover virtually all phases of our operations, including our educational programs, facilities, instructional and administrative staff, administrative procedures, marketing and recruiting, financial operations, including the payment of refunds to students who withdraw, and financial strength. These regulations also affect our ability to acquire or open additional schools, add new educational programs or change our corporate structure. The agencies that regulate our operations periodically revise their requirements and modify their interpretations of existing requirements.

        If one of our schools were to violate any of these regulatory requirements, we could suffer a financial penalty. A regulatory agency could also place limitations on our schools' operations or terminate the schools' ability to grant degrees and certificates or their eligibility to receive federal student financial aid funds. We cannot predict with certainty how all of these requirements will be applied, or whether each of our schools will be able to comply with all of the requirements in the future. We have described some of the most significant regulatory requirements and risks that apply to our U.S. schools in the following paragraphs.

        The U.S. Congress periodically revises the Higher Education Act and other laws governing the federal student financial aid programs and annually determines the funding level for each of these

20

programs. During 2003-2004, Congress is expected to devote significant attention to reauthorizing the Higher Education Act, which will likely result in numerous legislative changes. Any action by Congress that significantly reduces funding for the federal student financial aid programs or the ability of our schools or students to participate in these programs could have a material adverse effect on our student population and revenue. Legislative action may also increase our administrative costs and require us to modify our practices in order for our schools to comply fully with applicable requirements.

        To participate in the federal student financial aid programs, an institution must meet general standards of financial responsibility and either meet specific numeric measures of financial responsibility or post a letter of credit in favor of the Department of Education and possibly accept other conditions on its participation in the federal student financial aid programs. Currently, none of our schools is required to post a letter of credit in favor of the Department of Education or accept other conditions on its participation in the federal student financial aid programs due to failure to satisfy the numeric measures of financial responsibility. If, however, we or our institutions fail to satisfy the numeric standards in the future, any required letter of credit, if obtainable, and any limitations on our participation in the federal student financial aid programs could adversely affect our net income and student population. Our inability to obtain a required letter of credit also could adversely affect our net income and student population. Under a separate requirement, an institution must post a letter of credit if it makes more than a certain proportion of student refunds beyond the regulatory time period. Twenty-one of CEC's institutions have outstanding letters of credit in favor of the Department of Education in the aggregate amount of $2.8 million due to late student refunds. Three of Whitman's institutions have outstanding letters of credit in favor of the Department of Education in the aggregate amount of $575,000 due to late student refunds.

        An institution may lose its eligibility to participate in some or all of the federal student financial aid programs if defaults by its students on their federal student loans exceed specified rates. If any of our institutions, depending on its size, loses eligibility to participate in the federal student financial aid programs because of high student loan default rates, that loss could have a material adverse effect on our student population and revenue.

        A proprietary institution loses its eligibility to participate in the federal student financial aid programs if it derives more than 90% of its revenue from these programs in any fiscal year. If any of our institutions, depending on its size, loses eligibility to participate in the federal student financial aid programs, that loss could have a material adverse effect on our student population and revenue.

        When we acquire an institution, including Whitman, the Department of Education and most applicable state authorizing agencies and accrediting agencies consider that a change of ownership or control of the institution has occurred. For Department of Education purposes, an institution's eligibility to participate in the federal student financial aid programs is subject to review, and the institution could lose its eligibility to participate unless it can reestablish its state authorization and accreditation and satisfy the other requirements to be recertified by the Department of Education as an

21

eligible institution following any change of ownership or control. If an institution is recertified following a change of ownership or control, it will be on a provisional basis. The Department of Education has the authority to provisionally and temporarily certify an institution following a change of control under certain circumstances while the Department of Education reviews the institution's application. A change of ownership or control of an institution under the standards of the Department of Education may result in the temporary suspension of the institution's participation in the federal student financial aid programs until the Department of Education issues a temporary certification document. With respect to the state and accrediting agencies, most of the states and accrediting agencies include the sale of a controlling interest of common stock in the definition of a change of control. A change of control under the definition of any of these agencies would require the affected institution to reaffirm its state authorization or accreditation. The requirements to obtain such reaffirmation from the states and accrediting agencies with jurisdiction over our schools vary widely. If we were unable to promptly reestablish the state authorization, accreditation or Department of Education certification of an institution we acquired, depending on the size of that acquisition, that failure could have a material adverse effect on our business.

        If we experience a change of control under the standards of applicable state agencies, accrediting agencies or the Department of Education, we or the schools governed by such agencies must seek the approval of the relevant agencies. The failure of any of our schools to reestablish its state authorization, accreditation or Department of Education certification would result in a loss of federal student financial aid funding, which could have a material adverse effect on our student population and revenue.

        The Department of Education, applicable state agencies or applicable accrediting agencies may consider transactions or events other than a sale of a controlling interest of common stock to constitute a change of control. If the Department of Education or any of the other regulatory agencies interprets a particular sequence of events to constitute a change of control, we would be required to seek all necessary approvals to continue our participation in the federal student financial aid programs, and could at least temporarily lose access to financial aid funding on that basis. Some of these transactions or events, such as a significant acquisition of our common stock, may be beyond our control.

        A school that grants degrees, diplomas or certificates must be authorized by the relevant agencies of the state in which it is located and, in some cases, other states where the school is deemed to be operating. State authorization and accreditation by an accrediting agency recognized by the Department of Education also are required for an institution to participate in the federal student financial aid programs. Requirements for authorization or accreditation vary substantially among the applicable agencies, and some of our schools must satisfy highly detailed standards regarding their educational programs, facilities, faculty and other matters to maintain the necessary approvals. Loss of state authorization or accreditation by any of our campuses, depending on the size of the campus, could have a material adverse effect on our student population and revenue.

        Because we operate in a highly regulated industry, we are subject to compliance reviews, claims of non-compliance or lawsuits by government agencies or third parties. If the results of these reviews or proceedings are unfavorable to us or if we are unable to defend successfully against third-party lawsuits or claims, we may be required to pay money damages or be subject to fines, limitations, loss of federal

22

funding, injunctions or other penalties. Even if we adequately address issues raised by an agency review or successfully defend a third-party lawsuit or claim, we may have to devote significant money and management resources to address these issues.

        We derive a majority of our Canadian schools' revenue from Canadian governmental financial aid programs. Depending on their province of residence, Canadian students may receive loans under the Canada Student Loans Program, the Ontario Student Loans Plan and the Quebec Loans and Bursaries Program. In addition, there are students attending the Canadian schools who receive government-sponsored financial assistance from provinces other than Ontario and Quebec.

        Our Canadian schools must meet eligibility standards to administer these programs and must comply with extensive statutes, rules, regulations and requirements. Each of our Ontario schools will be required to share the cost of student loan defaults if defaults by its students on their Ontario Student Assistance Plan loans exceed specified rates. Our International Academy of Design and Technology and SoftTrain schools in Toronto currently do not have a default rate that exceeds the applicable threshold of 25%. However, our International Academy of Design and Technology school in Ottawa had an overall default rate of 28.6% in 2002 and has received a letter from the Ontario Ministry of Training, Colleges and Universities indicating that it may have to share in the costs of defaults and post an additional bond with the Ministry. If our Canadian schools cannot meet these and other eligibility standards or fail to comply with applicable requirements, it could have a material adverse effect on our net income.

        The Canadian, Ontario and Quebec governments continuously review the legislative, regulatory and other requirements relating to student financial assistance programs due to political and budgetary pressures. Although we do not anticipate a significant reduction in the funding for these programs, any change that significantly reduces funding or the ability of our schools to participate in these programs could have a material adverse effect on our student population and revenue.

        Our schools in France, the United Kingdom and the United Arab Emirates are subject to extensive local regulations and requirements. If we are found to be in violation of these local regulations, including licensing and accreditation requirements, we could be subject to civil sanctions, including monetary penalties. Additionally, we could be required to incur significant ongoing expenses to comply with these regulatory requirements or, conceivably, could be restricted or barred from providing educational services in that jurisdiction.

        We have grown rapidly since our incorporation in January 1994. Our continued rapid growth may place a strain on our management, operations, employees or resources. We may not be able to maintain or accelerate our current growth rate, effectively manage our expanding operations or achieve planned growth on a timely or profitable basis. If we are unable to manage our growth effectively, we may experience operating inefficiencies and our net income may be materially adversely affected.

        We offer a variety of payment plans to help students pay that portion of their education expense not covered by financial aid programs. These balances are unsecured and not guaranteed. Losses related to unpaid student balances in excess of the amounts we have reserved for bad debts could have a material adverse effect on our business.

23

        We expect to continue to rely on acquisitions as a key component of our growth. From time to time, we engage in, and we are currently engaged in, evaluations of, and discussions with, possible acquisition candidates. We may not continue to be able to identify suitable acquisition opportunities or to acquire any such schools on favorable terms. Furthermore, we may not be able to successfully integrate any acquired schools into our operations profitably. Acquisitions involve a number of special risks and challenges, including:

        Acquired schools may not enhance our business and, if we do not successfully address associated risks and uncertainties, may ultimately have a material adverse effect on our growth and ability to compete.

        We have also grown by opening new schools, primarily as additional branches of existing schools. Establishing new schools poses unique challenges and requires us to make investments in management, capital expenditures, marketing expenses and other resources different, and in some cases greater, than those required with respect to the operation of acquired schools. When opening a new school, we may be required to obtain appropriate state or provincial and accrediting agency approvals. In addition, to be eligible for federal student financial aid programs, such a school has to be certified by the Department of Education. Our failure to effectively manage the operations of newly established schools or service areas, or any diversion of management's attention from our core career-oriented school operating activities, could harm our business.

        Prospective employers of our graduates increasingly demand that their entry-level employees possess appropriate technological skills. Educational programs at our schools, particularly programs in visual communications and information technology, must keep pace with these evolving requirements. If we cannot respond to changes in industry requirements, it could have a material adverse effect on our ability to attract students.

        The post-secondary education market is highly competitive. Our schools compete with traditional public and private two-year and four-year colleges and universities and other proprietary schools,

24

including those that offer distance learning programs. Some public and private colleges and universities, as well as other private career-oriented schools, offer programs similar to those of our schools. Although tuition at private nonprofit institutions is, on average, higher than tuition at our schools, some public institutions are able to charge lower tuition than our schools, due in part to government subsidies and other financial sources not available to proprietary schools. Some of our competitors in both the public and private sectors have substantially greater financial and other resources than us. We may incur increasing costs competing for students. If we are not able to compete effectively for students, our revenue may decline.

        Although we currently operate in the United States, Canada, France, the United Kingdom and Dubai, we intend to explore opportunities outside those markets. There may be difficulties and complexities associated with our expansion into these other international markets, and our strategies may not succeed beyond our current markets. International operations present inherent risks, including:

If we do not effectively address these risks, our growth and ability to compete may be impaired.

        Failure to obtain additional capital in the future could reduce our ability to grow.

        We believe that funds from operations, cash, investments and borrowings under our $200 million credit facility pursuant to our credit agreement, approximately $119.7 million of which we expect to access to fund the cash consideration payable to Whitman's shareholders and option holders in the merger, will be adequate to fund our current operating plans for the foreseeable future. However, we may need additional debt or equity financing in order to carry out our strategy of growth through acquisitions. We may also need additional debt or equity financing in the future to carry out our growth strategy. The amount and timing of such additional financing will vary principally depending on the timing and size of acquisitions and the sellers' willingness to provide financing themselves. To the extent that we require additional financing in the future and are unable to obtain such additional financing when needed or on terms acceptable to us, we may not be able to fully implement our growth strategy.

        Our credit agreement limits our ability to take various actions, including paying dividends and disposing of assets. Accordingly, we may be restricted from taking actions which management believes would be desirable and in the best interests of us and our stockholders. The credit agreement also requires us to maintain specified financial ratios and satisfy specified financial tests. A breach of any covenants contained in the credit agreement could result in an event of default under that agreement and allow the lenders to pursue various remedies, including accelerating the indebtedness outstanding thereunder, any of which could have a material adverse effect on our business or financial condition.

        Our success to date has depended, and will continue to depend, largely on the skills and efforts of John M. Larson, our Chairman, President and Chief Executive Officer, Patrick K. Pesch, our Executive

25

Vice President, Chief Financial Officer, Treasurer and Secretary, Nick Fluge, President of our Online Education Group, and Jacob P. Gruver, President of our Colleges, Schools & Universities Group, and our other key personnel. Our success also depends, in large part, upon our ability to attract and retain highly qualified faculty, school presidents and administrators and corporate management. Due to the nature of our business, we may have difficulty locating and hiring qualified personnel, and retaining such personnel once hired. None of our employees is subject to an employment or noncompetition agreement other than Mr. Larson. We do not maintain life insurance on any of our employees. The loss of the services of any of our key personnel, or our failure to attract and retain other qualified and experienced personnel on acceptable terms, could have a material adverse effect on our business, results of operations or financial condition. In addition, a limited number of our faculty members are represented by unions, although they are not currently subject to collective bargaining agreements. If we become subject to collective bargaining agreements, our flexibility in making human resources decisions could be impaired.

        Terrorist attacks and other acts of violence or war, such as those that took place on September 11, 2001, could disrupt our operations. Attacks or armed conflicts that directly impact our physical facilities or ability to recruit foreign students could significantly affect our ability to provide educational services to our students and thereby impair our ability to achieve our expected results. Further, violent acts and threats of future attacks could adversely effect the U.S. and world economies. Finally, further terrorist acts could cause the United States to enter into a wider armed conflict which could further impact our operations and result in prospective students, as well as our current students and employees, entering the armed forces. These factors could cause significant declines in our population and could have a material adverse effect on our revenue.

        Provisions of our certificate of incorporation and our bylaws may delay, defer or inhibit a future acquisition of us not approved by our board of directors. These provisions are intended to encourage any person interested in acquiring us to negotiate with and obtain the approval of our board of directors in connection with the transaction. For example, our certificate of incorporation authorizes our board of directors to issue up to 1,000,000 shares of preferred stock with such voting, conversion and other rights, preferences, privileges and restrictions as it determines, without any further vote or action by our stockholders. The rights of the holders of our common stock will be subject to, and may be harmed by, the rights of the holders of our preferred stock that may be issued in the future. In addition, our certificate of incorporation divides our board of directors into three classes having staggered terms. We are also subject to the provisions of Delaware law that could have the effect of delaying, deferring or preventing a change of control of our company. One of these provisions prevents us from engaging in a business combination with any interested stockholder for a period of three years from the date the person becomes an interested stockholder, unless specified conditions are satisfied. We have also implemented a stockholders' rights plan, also commonly called a "poison pill," that would substantially reduce or eliminate the expected economic benefit to an acquiror from acquiring us in a manner or on terms not approved by our board of directors. These and other impediments to a third-party acquisition or change of control could limit the price investors are willing to pay in the future for shares of our common stock.

26

        AIU Online and CTU's distance learning program both intend to continue increasing their number of students and additional resources will be required to support this anticipated growth, including additional faculty, and enrollment, academic and financial counselors. AIU Online's exceptional growth to this point has placed, and future growth is expected to place, a significant strain on AIU Online's financial and operational resources. The continued development of awareness of the programs offered by AIU Online is critical to the continued acceptance and growth of AIU Online's programs. If AIU Online is unable to continue to develop awareness of the programs offered by it, this could limit its enrollments and negatively impact its ability to increase revenues and profitability.

        Both AIU Online's and CTU's distance learning program's success depends in part on their ability to expand the content of programs, develop new programs in a cost-effective manner, and meet students' needs in a timely manner. The expansion of their existing programs and the development of new programs may not be accepted by their students or the online education market. CTU also must seek approval for expansion of its distance learning offerings from its accreditor, the North Central Association of Colleges and Schools.

        The performance and reliability of AIU Online's program infrastructure and CTU's distance learning infrastructure are critical to the respective reputations of AIU Online and CTU, and their ability to attract and retain students. Any system error or failure, or a sudden and significant increase in traffic, may result in the unavailability of AIU Online's computer networks. CTU contracts with an outside vendor specialist in providing technical support to distance learning providers. The performance of this contractor cannot be guaranteed and certain system errors or failures or demand changes could occur, which could cause CTU's computer network to be unavailable. Individual, sustained, or repeated occurrences could significantly damage the reputation of AIU Online or CTU's distance learning program and result in a loss of potential or existing students. Additionally, these computer systems and operations are vulnerable to interruption or malfunction due to events beyond our control, including natural disasters and telecommunications failures. Any interruption to AIU Online's computer systems or operations could have a material adverse effect on the ability of AIU Online to attract and retain students. Any interruption to the computer systems of CTU's vendor would disrupt CTU's distance learning courses.

        AIU Online's computer networks may be vulnerable to unauthorized access, computer hackers, computer viruses, and other security problems. A user who circumvents security measures could misappropriate proprietary information or cause interruptions or malfunctions in operations. Due to the sensitive nature of the information contained on AIU Online's networks, such as students' grades, its networks may be targeted by hackers. As a result, AIU Online may be required to expend significant resources to protect against the threat of these security breaches or to alleviate problems caused by these breaches.

27


CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

        This proxy statement/prospectus contains and incorporates by reference "forward-looking statements," as defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, that reflect current expectations of CEC and/or Whitman, as applicable, regarding the future growth, results of operations, performance and business prospects and opportunities of CEC, Whitman and the combined company. We have tried to use words such as "anticipate," "believe," "plan," "expect," "intend" and similar expressions to identify these forward-looking statements. These forward-looking statements include the following information about the proposed merger:

        Forward-looking statements are based on information currently available to us and are subject to risks and uncertainties that could cause the actual growth, results of operations, performance and business prospects and opportunities of CEC, Whitman or the combined companies to differ materially from those expressed in, or implied by, these statements. These risks and uncertainties include the following:

        You should not place undue reliance on forward-looking statements. Except as otherwise specifically required by federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements contained or incorporated by reference in this proxy statement/prospectus, whether as a result of new information, future events, changed circumstances or otherwise.

28


THE WHITMAN SPECIAL MEETING

Date, Time and Place of the Special Meeting

        We are sending this proxy statement/prospectus to you as part of the solicitation of proxies by the Whitman board of directors for use at the special meeting, and any adjournment or postponement of that special meeting, to be held at Whitman's executive offices located at 4400 Biscayne Boulevard, 14th Floor, Miami, Florida 33137, on July 1, 2003 at 10:00 a.m., local time. We are first mailing this proxy statement/prospectus to you on or about June 2, 2003.

Purpose of the Special Meeting

        At the special meeting, Whitman shareholders will consider and vote upon a proposal to approve the Agreement and Plan of Merger, dated as of March 26, 2003, among Whitman, CEC and Marlin Acquisition Corp. a wholly-owned subsidiary of CEC. The merger agreement provides for the merger of Whitman with and into Marlin Acquisition Corp., with Marlin Acquisition Corp. continuing as a wholly-owned subsidiary of CEC.

        Whitman does not expect any matter to be brought before the special meeting other than the merger. If other matters are properly presented at the special meeting, the persons named in the proxy card will vote in their discretion with respect to those matters. However, if a proposal to adjourn or postpone the meeting is properly presented to permit the Whitman board of directors to further solicit proxies because there are not sufficient votes to approve the merger agreement at the time of the special meeting, the persons named in the proxy card will not have discretion to vote shares voted against the merger agreement in favor of adjournment or postponement to solicit further proxies in favor of the merger agreement.

        The Whitman board of directors has unanimously approved the merger agreement and recommends that you vote FOR the approval of the merger agreement.

Record Date and Outstanding Shares; Voting Rights

        Only holders of record of Whitman common stock at the close of business on the record date, May 23, 2003, are entitled to notice of, and to vote at, the special meeting. At the close of business on the record date, there were 15,445,115 shares of Whitman common stock outstanding held by approximately 262 holders of record. Each holder of record of Whitman common stock on the record date will be entitled to one vote for each share held on all matters to be voted upon at the special meeting.

Quorum; Required Votes; Abstentions and Broker Non-Votes

        At the special meeting, a quorum requires the presence, in person or by proxy, of the holders of a majority of the shares of Whitman common stock outstanding as of the record date. Abstentions and broker non-votes, which are executed proxies returned by a broker holding shares in "street name" that indicate that the broker has not received voting instructions from the beneficial owner of the shares and does not have discretionary authority to vote the shares with respect to the approval of the merger agreement, will be counted as shares present for purposes of determining whether a quorum exists.

        Approval of the merger agreement requires the affirmative vote of a majority of the shares of Whitman common stock outstanding as of the record date. The failure to submit a vote, abstentions and broker non-votes will have the same effect as votes "AGAINST" the approval of the merger agreement. As of the record date, Whitman directors and executive officers had voting power with respect to approximately 27.4% of the outstanding shares of Whitman common stock. Phillip Frost, Whitman's chairman of the board, and a trust of which he is sole trustee, Richard Pfenniger, Jr., Whitman's chief executive officer and vice-chairman of the board, and Fernando Fernandez, Whitman's

29


chief financial officer, have entered into a voting agreement with CEC in which they agree to vote the Whitman shares for which they have voting power in favor of the merger. These shares represent approximately 27.1% of the shares of Whitman common stock outstanding as of the record date. The remaining directors and executive officers of Whitman have indicated their intention to vote the Whitman shares for which they have voting power in favor of the approval of the merger agreement.

Proxies; Revocability of Proxies

        All shares of Whitman common stock represented by properly executed proxies received before or at the special meeting will, unless the proxies are revoked, be voted in accordance with the instructions indicated on those proxies. If you are a shareholder of record and you return a properly executed proxy card but fail to vote on the proposal, the designated proxies will exercise their discretionary authority and vote your shares "FOR" the approval of the merger agreement.

        If your shares are held in "street name" in an account at a brokerage firm, bank or other fiduciary, you should direct them on how to vote your shares. If you do not provide your broker, bank or other fiduciary with instructions on how to vote your shares with respect to the merger proposal, your broker, bank or other fiduciary will not vote your shares, which will result in a "broker non-vote" for your shares. Broker non-voters will have the same effect as a vote against the merger agreement.

        If you receive more than one proxy card, it is because you hold your Whitman shares in different names. For example, you may hold some of your Whitman shares individually, some jointly with your spouse and some in trust for your children, in which case you should receive three separate proxy cards to vote. Please complete, date, sign and return all of the proxy cards.

        A Whitman shareholder of record giving a proxy has the power to revoke its proxy and change its votes by:

Attendance at the special meeting will not in and of itself constitute revocation of a proxy; you must cast an actual vote. If your shares are held in the name of a bank, broker or other fiduciary and you have directed that person to vote your shares, you must instruct that person if you want to change your vote.

Solicitation of Proxies

        Whitman and CEC will share equally the cost of printing and mailing this proxy statement/prospectus. Whitman may supplement the initial solicitation of proxies by mail by telephone, fax, e-mail or personal solicitation by directors, officers or other regular employees of Whitman. No additional compensation will be paid to directors, officers or other regular employees for these services. Whitman will request brokers, banks and other fiduciaries holding Whitman common stock beneficially owned by others to send this proxy statement/prospectus to, and obtain proxies from, the beneficial owners of the shares and will reimburse the holders for their reasonable expenses in doing so. Whitman has engaged Georgeson Shareholder Communications, Inc. to help it solicit proxies at a cost of approximately $6,500 plus expenses.

        You should not send in any Whitman stock certificates with your proxy card. The exchange/paying agent will mail a transmittal letter to you containing instructions for the surrender of Whitman stock certificates as soon as practicable after completion of the merger.

30



THE MERGER

Structure of the Merger

        If the Whitman shareholders approve the merger agreement and we satisfy or waive all other conditions to the merger contained in the merger agreement, Whitman will merge with and into Marlin Acquisition Corp., a wholly-owned subsidiary of CEC. As a result Whitman will cease its separate corporate existence and Marlin Acquisition Corp. will continue as a wholly-owned subsidiary of CEC. We intend to complete the merger as soon as possible after obtaining shareholder approval at the Whitman special meeting and satisfaction or waiver of all other conditions contained in the merger agreement, which we hope will be in early July 2003. We cannot, however, predict exactly when we will complete the merger.

Background of the Merger

        Whitman's board of directors and management have periodically reviewed alternatives available to Whitman as part of their ongoing focus on enhancing shareholder value. These alternatives have generally included continued internal growth and possible growth through a business combination with a strategic partner who might provide access to greater financial resources and operational capabilities. From time to time, members of Whitman's management have received and considered unsolicited informal expressions of interest from parties interested in pursuing a business combination with Whitman.

        In early 2002, Whitman was approached by a publicly-traded education company that expressed interest in acquiring or entering into a business combination with Whitman. The Whitman board authorized Whitman's senior management to engage in discussions with that party and, in connection with those discussions, on February 21, 2002, Whitman retained Legg Mason Wood Walker, Incorporated as its exclusive financial advisor to advise the Whitman board in reviewing that party's proposal and any other proposals that Whitman might receive regarding the sale of Whitman.

        Over the first half of 2002, Whitman engaged in preliminary discussions with a total of four publicly-traded education companies, including CEC. Each of these companies independently approached Whitman and expressed interest in acquiring or entering into a business combination with Whitman, and Whitman provided limited due diligence information to these parties after receiving confidentiality agreements covering the provided information. Throughout this period, Richard Pfenniger, Jr., the vice-chairman and chief executive officer of Whitman, had a number of informal discussions with members of the Whitman board and Whitman's financial and legal advisors. He also advised the Whitman board on the status of any ongoing discussions at the regular board meetings during this period.

        On May 14, 2002, Mr. Pfenniger and John M. Larson, the chairman and chief executive officer of CEC, along with Patrick Pesch, executive vice president and chief financial officer of CEC, and Todd Steele, executive vice president of planning and development of CEC, had an informal introductory meeting at a New York Society of Security Analysts conference. Both companies were presenting at the conference.

        In mid-June of 2002, Mr. Steele contacted Mr. Pfenniger to request a meeting in Miami to learn more about Whitman's business and to explore whether a transaction between CEC and Whitman might benefit both parties.

        On June 26 and 27, 2002, Mr. Steele met with Mr. Pfenniger and Fernando Fernandez, Whitman's chief financial officer, in Miami. Prior to the meeting, CEC signed a confidentiality and standstill agreement with Whitman, agreeing (1) to keep information it obtained from Whitman confidential and (2) to not engage in certain transactions for a specified period of time with respect to Whitman's common stock without the consent of the Whitman board. During the meetings, the parties discussed

31


their operating philosophies and business strategies, as well as the status of Whitman's business operations, and Mr. Steele requested detailed financial information about Whitman's operations.

        Over the next few weeks, CEC received and analyzed Whitman's financial information and on July 15, 2002, CEC's interest in Whitman was discussed at a regularly scheduled meeting of CEC's board of directors.

        On July 31 and August 1, 2002, Mr. Steele met with Mr. Pfenniger and Mr. Fernandez in Miami. In addition to further discussion of Whitman's business and additional requests for due diligence information, Mr. Steele and Mr. Pfenniger had a preliminary discussion regarding a potential merger of CEC and Whitman, including potential structuring parameters and the transaction process.

        At a regularly scheduled meeting on August 1, 2002, Whitman's board of directors discussed the status of the discussions with CEC and the other companies that had approached Whitman.

        In early August 2002, Mr. Steele telephoned Mr. Pfenniger to discuss CEC's initial thoughts regarding a proposal for the acquisition of Whitman for $9.00 per share. Mr. Pfenniger responded that Whitman was not interested in the specific proposal discussed. The parties did not reach any agreement during the conversation, but decided to continue with further discussions.

        During the summer of 2002, each of the other three parties that had previously expressed an interest in pursuing a business combination with Whitman either suspended those discussions and their due diligence investigations or significantly curtailed their contacts with Whitman's management. Two of those three companies never submitted a proposal to Whitman. The remaining company, which was also the first to have approached Whitman, had submitted a proposal to Whitman during May 2002 for a business combination transaction but had shortly thereafter suspended its discussions with Whitman in order to pursue another acquisition. Although this party resumed periodic discussions with Whitman in the summer of 2002, it indicated to Mr. Pfenniger at that time that it was not prepared to pursue a business combination on the terms it had previously proposed but made a revised proposal on terms that Whitman believed were less attractive than the party's original proposal. Whitman agreed to allow the other party to continue its due diligence investigation.

        On September 27, 2002, Mr. Steele telephoned Mr. Pfenniger to propose an acquisition of all of the outstanding stock of Whitman for $11.00 per share consisting of $4.00 in cash and shares of CEC's common stock valued at $7.00. CEC also sent a letter describing the proposal to Whitman. At the time of this proposal, Whitman's common stock was trading in a range between $5.00 and $6.00 per share. After reviewing the proposal, Mr. Pfenniger responded that CEC's proposal was inadequate. Mr. Pfenniger suggested that CEC continue its financial analysis of Whitman.

        On October 14, 2002, CEC's board of directors discussed the status of the negotiations with Whitman during a regularly scheduled meeting.

        During October 2002, CEC continued its analysis of the information provided by Whitman and monitored Whitman's operational performance. Mr. Steele held periodic conversations with Mr. Pfenniger and Mr. Fernandez about Whitman's business. In late October or early November the parties agreed to have CEC and its advisors conduct several days of due diligence on-site at Whitman's corporate offices in Miami, to provide CEC greater detail regarding Whitman's operations to potentially support a higher valuation. CEC sent Whitman a detailed information request list on November 7, 2002.

        On November 1, 2002, Whitman's board of directors discussed the status of the negotiations with CEC and the other party during a regularly scheduled meeting.

        From December 11 until December 13, 2002, a team of CEC employees, its corporate counsel, Katten Muchin Zavis Rosenman, and Ernst & Young LLP, traveled to Whitman's corporate offices in Miami to conduct preliminary business, legal and financial due diligence.

32

        On December 16, 2002, CEC's board of directors discussed the status of the negotiations with Whitman during a regularly scheduled meeting, and on December 17, 2002, Mr. Larson, Mr. Pesch and Mr. Steele met in Miami with Mr. Pfenniger, Mr. Fernandez and David Ruggieri, president of Whitman's Ultrasound Diagnostics Schools subsidiary, to discuss Whitman's current business operations and prospects.

        Following this meeting, on December 20, 2002, Mr. Steele submitted a revised proposal to Mr. Pfenniger for an acquisition of all of the outstanding stock of Whitman for $12.50 per share consisting of $6.50 in cash and shares of CEC's common stock valued at $6.00. CEC also sent a letter describing this proposal to Whitman. At the time, Whitman's common stock was trading in a range between $6.00 and $7.00 per share.

        During mid-December 2002, representatives of the other party that had previously proposed a business combination involving Whitman contacted representatives of Legg Mason and indicated that the other party desired to meet with Whitman to resume discussions. On December 19, 2002, Mr. Pfenniger, Mr. Fernandez, Mr. Ruggieri and representatives of Legg Mason met with representatives of this other party and held discussions regarding each other's businesses and a possible business combination transaction.

        Following these discussions, in late December 2002, the other party proposed a business combination involving Whitman at a price per share that was lower than CEC's December 20th proposal. In early January 2003, Whitman advised the other party that it did not believe that the party's most recent proposal was adequate. Although the other party thereafter indicated that it might be willing to increase the price per share it was willing to offer, the revised offer the other party suggested that it might consider offering was still lower than CEC's December 20th proposal. In response, Mr. Pfenniger suggested that the other party continue its due diligence investigation and resume discussions if it was interested in pursuing a transaction at a higher value for Whitman shareholders after completing its due diligence.

        In early January 2003, Mr. Pfenniger informed Mr. Steele that although CEC's December 20th proposal was improved, it still did not represent an adequate value for Whitman. Mr. Pfenniger and Mr. Steele then agreed that CEC would work toward completing its due diligence review of Whitman, and that during the same period the parties would prepare and fundamentally agree on the terms of a merger agreement subject to continued negotiation of a mutually acceptable price.

        On January 7, 2003, Mr. Pfenniger sent a preliminary term sheet to CEC outlining certain non-financial terms for the merger transaction.

        On February 1, 2003, Mr. Pfenniger discussed the status of his discussions with CEC and the other potential acquirer at a regular meeting of the Whitman board. At the February 1 meeting, the Whitman board encouraged Mr. Pfenniger to pursue discussions with both CEC and the other party to determine whether a mutually agreeable proposal could be reached with either of those parties.

        From February 10, 2003 until February 12, 2003, a team of CEC employees, along with advisors from Katten Muchin Zavis Rosenman and Ernst & Young LLP, traveled to Whitman's corporate offices in Miami to conduct further business, legal and financial due diligence.

        On February 13, 2003, Katten Muchin Zavis Rosenman delivered to Whitman and its outside counsel a first draft of a proposed merger agreement and voting agreement. Subsequently, representatives of Whitman's outside counsel and Katten Muchin Zavis Rosenman negotiated various provisions of the agreements and, on March 7, 2003, Katten Muchin Zavis Rosenman delivered a revised draft of the merger agreement and the voting agreement. The parties agreed to meet in Miami the following week for detailed discussions concerning the terms of a potential transaction.

33


        On March 3, 2003, the board of directors of CEC briefly discussed the status of negotiations with Whitman during a regularly scheduled telephonic board meeting.

        From March 10, 2003 until March 12, 2003, representatives of CEC and Katten Muchin Zavis Rosenman met in Miami with representatives of Whitman and its outside counsel, for detailed discussions concerning provisions of the merger agreement and other transaction documents. At these meetings, CEC proposed to pay $14.00, consisting of $6.00 in cash and shares of CEC's common stock valued at $8.00, for each outstanding share of Whitman common stock. Whitman provided a counter-proposal of $14.25 for each outstanding share of Whitman common stock. CEC tentatively agreed to this price, and proposed delivering $6.00 in cash and shares of CEC's common stock valued at $8.25, subject to Whitman agreeing to enter into an exclusivity agreement and satisfactory conclusion of the negotiations of the material open items in the merger agreement. After reviewing the terms of CEC's increased proposal in comparison to Whitman's prior discussions both with CEC and the other parties (including the second party which had made a proposal during 2002), Whitman agreed to grant CEC the exclusivity period, subject to Whitman's right to continue to provide the second party with due diligence information requested by that other party. On March 12, 2003, CEC and Whitman entered into an exclusivity agreement prohibiting Whitman from soliciting acquisition proposals from, or discussing acquisition proposals with, third parties through March 28, 2003 subject to Whitman's right to continue to provide due diligence information to the other party as described above.

        On March 14, 2003, representatives of the second party conducted a previously arranged visit to Whitman's Miami offices to continue their due diligence but did not submit a revised proposal.

        On March 17, 2003, Mr. Pfenniger, Mr. Fernandez and a representative of Legg Mason met with CEC's senior management at CEC's offices in Hoffman Estates to discuss CEC's operations, financial condition and future prospects. Prior to the meeting Whitman signed a confidentiality and standstill agreement with CEC, agreeing (1) to keep information it obtained from CEC confidential and (2) to not engage in certain transactions for a specified period of time with respect to CEC common stock without the consent of CEC's board of directors. During that same week, two representatives of CEC accompanied Mr. Pfenniger to Whitman's Colorado Technical University campus in Colorado Springs, and two other representatives of CEC accompanied Mr. Ruggieri on visits to four of Whitman's Ultrasound Diagnostics Schools campuses. During this time period, Mr. Pfenniger had informal discussions with the members of the Whitman board of directors concerning the status of the negotiations with CEC.

        Representatives of CEC and Katten Muchin Zavis Rosenman met in Miami with representatives of Whitman and its outside counsel on March 24, 2003 and March 25, 2003, to finalize the transaction documents.

        On March 25, 2003, CEC's board of directors met to discuss the proposed merger, including the pricing and other key terms of the merger agreement. At the meeting, the board of directors received presentations from CEC's management and Katten Muchin Zavis Rosenman regarding the proposed merger and merger agreement. After careful consideration of the structure, terms and conditions of the proposed merger, CEC's board of directors unanimously approved the proposed transaction as in the best interests of CEC.

        Whitman's board of directors met on March 26, 2003 to discuss the proposed merger, including the pricing and other terms of the merger agreement. The Whitman board of directors was advised by management and by Whitman's outside counsel on the terms and conditions contained in the merger agreement and the voting agreement, and the negotiations which had led to such terms. At that meeting, a representative of Legg Mason made a presentation to the Whitman board and, after reviewing the material factors in its assessment of the proposed merger, Legg Mason indicated that as of that date, in its opinion, the proposed merger consideration to be received by Whitman shareholders was fair from a financial point of view to Whitman shareholders. All directors participated in

34


discussions concerning the proposed transaction and the course of action that Whitman should take. After careful consideration of the structure, terms and conditions of the proposed merger, the Whitman board unanimously approved the merger agreement and the transactions contemplated thereby as in the best interests of Whitman and its shareholders.

        On March 26, 2003, representatives of both Whitman and CEC finalized and executed the merger agreement and all related agreements and documents. The parties issued a joint press release announcing the proposed merger later that day.

Whitman's Reasons for the Merger

        The Whitman board of directors has unanimously determined that the merger is in the best interests of Whitman and its shareholders and approved the merger agreement. The Whitman board of directors therefore unanimously recommends that you vote "FOR" the approval of the merger agreement.

        In making its recommendation, the Whitman board of directors considered a number of factors, including, without limitation, the factors mentioned in the section entitled "Background of the Merger" above, and the following:

35

        The Whitman board of directors also considered potential detriments involved in the merger, including the following:

36

        The foregoing discussion of the information and factors considered and given weight by the Whitman board of directors is not intended to be exhaustive. In view of the wide variety of factors considered in connection with its evaluation and approval of the merger agreement and the complexity of those matters, the Whitman board did not find it useful or practical to, and did not, quantify or otherwise assign relative or specific weights to the specific factors considered in reaching its determination. In addition, individual members of the Whitman board of directors may have assigned different weights to different factors. The Whitman board of directors determined, however, that, overall, the positive factors of the merger to Whitman and its shareholders outweighed the negative factors and risks of the merger and, therefore, unanimously approved the transactions contemplated by the merger agreement and recommended that the merger agreement be approved by the Whitman shareholders.

CEC's Reasons for the Merger

        From CEC's perspective, the merger furthers its strategy to invest in growth opportunities while creating operating efficiencies through economies of scale by acquiring schools that CEC believes will benefit from the implementation of its business operating and marketing strategy. For example, CEC believes that the merger will strengthen CEC's health and online educational programs. The merger will also expand CEC's geographic presence to include new major markets in the United States. CEC expects the merger to open new opportunities for it to offer a wider range of credential options to meet the needs of a broader student population and to enhance the competitive position of its business and CEC's overall strength in the private, post-secondary education market.

Opinion of Financial Advisor to Whitman

        In February 2002, Whitman engaged Legg Mason Wood Walker, Incorporated to act as Whitman's exclusive financial advisor in advising Whitman concerning proposals Whitman received for the sale of Whitman and, if requested by Whitman, assisting in negotiating the terms of a possible merger opportunity. The engagement also provided that if an agreement was reached, Legg Mason would provide an opinion as to the fairness, from a financial point of view, of the consideration to be received by Whitman's shareholders. Legg Mason was not authorized to and did not solicit indications from interested parties; however, it did advise Whitman regarding unsolicited expressions of interest to acquire Whitman or control of Whitman.

        Legg Mason has provided CEC with financing services in the past for which Legg Mason has received customary fees.

        At the March 26, 2003 meeting of the Whitman board of directors, Legg Mason delivered its opinion to the Whitman board of directors that, based on and subject to the assumptions and conditions set forth in its opinion, as of March 26, 2003, the merger consideration of $14.25 per share ($6.00 per share in cash and $8.25 per share in CEC common stock), subject to adjustment under the terms of the merger agreement, to be received by Whitman's shareholders, is fair to such shareholders, from a financial point of view.

        The full text of the opinion, which sets forth the assumptions made, matters considered and the scope and limitations of the review undertaken by Legg Mason in rendering its opinion, is attached as Annex B to this proxy statement/prospectus, and Legg Mason has consented to its attachment to this proxy statement. You are urged to read the entire Legg Mason opinion carefully. The opinion is

37


directed only to the fairness, from a financial point of view, to Whitman shareholders, of the merger consideration to be received by such shareholders. The opinion does not constitute a recommendation of the merger over any other alternative transaction (including the alternative to not effect the merger) that may be available to Whitman and does not address the underlying business decision of the Whitman board of directors to proceed with or to effect the merger. Also, Legg Mason is not making any recommendation to Whitman's shareholders as to whether or not they should vote for or against the merger. In requesting Legg Mason's opinion, the Whitman board of directors did not give any special instructions to Legg Mason or impose any limitation upon the scope of investigation that Legg Mason deemed necessary to enable it to deliver its opinion.

        In arriving at its opinion, Legg Mason had, among other things:

        In connection with its evaluation and preparation of the opinion, Legg Mason assumed and relied upon the accuracy and completeness of all financial and other information supplied to Legg Mason by Whitman's management and all publicly available information, and did not independently verify the information. Legg Mason also relied upon Whitman's management as to the reasonableness and achievability of the financial projections (and the assumptions and bases in the projections) that Whitman's senior management provided to Legg Mason, and Legg Mason assumed that the projections were reasonably prepared on bases reflecting the best currently available estimates and judgments of Whitman's management as to Whitman's future operating performance. In arriving at its opinion, Legg Mason relied upon the financial data for fiscal years 2000 through 2007 presented to the Whitman board of directors at its meeting on March 26, 2003. The projected financial data for 2003 through 2007 were Whitman's latest available projections provided to Legg Mason by Whitman's management as of the date the opinion was rendered. Whitman does not customarily disclose internal management

38


projections of the type provided to Legg Mason in connection with the evaluation and preparation of the opinion. These projections were not prepared with the expectation of public disclosure. The projections were based on numerous variables and assumptions that are inherently uncertain, including factors related to general economic and competitive conditions. Accordingly, actual results could vary significantly from those set forth in the projections. Legg Mason was not requested to make, and did not make, an independent appraisal or evaluation of Whitman's or CEC's assets, properties, facilities or liabilities, and Legg Mason has not been furnished with any appraisals or evaluations in respect thereof.

        The Legg Mason opinion is necessarily based on economic, market and other conditions and circumstances as they existed or were in effect on, and the information made available to Legg Mason as of, March 24, 2003. Legg Mason expressed no opinion as to what the value of common stock of Whitman or CEC actually would be when the merger is consummated or as to the price or trading range at which either Whitman or CEC common stock was expected to trade following the announcement of the merger.

        In connection with rendering its opinion, Legg Mason assumed in all respects material to its analyses that the merger will be consummated according to the terms and conditions described in the merger agreement without any waiver of material terms or conditions by any party thereto, and that satisfying any other conditions for completing the merger would not have an adverse effect on Whitman.

        The following is a summary of the principal financial and valuation analyses performed by Legg Mason in connection with its preparation of the opinion. These analyses were presented to, and discussed with, the Whitman board of directors at its meeting on March 26, 2003.

        Legg Mason utilized a series of valuation methodologies customary among investment professionals to determine an estimated value for Whitman before giving effect to the merger. These valuation methodologies included (a) comparable public companies analysis; (b) premium paid analysis; (c) comparable transactions analysis; and (d) discounted cash flow, or DCF, analysis. Legg Mason regarded each of these analyses to be appropriate and reflective of generally accepted valuation methodologies given Whitman's trading volume relative to total shares outstanding, the accessibility of comparable publicly traded companies and available information regarding similar transactions in the education industry. In each analysis, Legg Mason calculated the implied equity value per share of Whitman common stock. Legg Mason then compared the implied equity values that it calculated to a $14.25 per share merger consideration.

        Legg Mason compared Whitman's relevant historical and current financial and operating results with the operating results of selected publicly traded companies that are engaged in postsecondary education, collectively referred to as the comparable companies. Legg Mason chose six comparable public companies based on general business, operating and financial characteristics representative of companies in the industry in which Whitman operates. No company or business used in the analysis of comparable companies is identical or substantially identical to Whitman. Legg Mason excluded two otherwise comparable companies, Apollo Group, Inc. ("Apollo Group") and Strayer Education Group, Inc. ("Strayer Education"), from its analysis because Apollo Group's market capitalization is on average six times that of any other comparable member and Strayer Education's margins are on average three times those of Whitman. Legg Mason relied upon the mean and median multiples of the other comparable companies.

        In performing its analysis, Legg Mason calculated multiples of, among other things, each comparable company's TTM (trailing twelve months) EBITDA (earnings before interest, taxes,

39


depreciation and amortization), TTM EPS (earnings per share), projected 2003 EBITDA and projected 2003 EPS, collectively referred to as the Enterprise and Equity Value Multiples.

        In using the comparable companies analysis to value Whitman before giving effect to the merger, Legg Mason analyzed financial information, which included:

        For the purposes of this analysis, the comparable companies selected by Legg Mason were six companies that operate in the postsecondary education industry as listed below:

        CEC;

        Concorde Career Colleges, Inc.;

        Corinthian Colleges, Inc.;

        DeVry, Inc.;

        Education Management Corporation; and

        ITT Educational Services, Inc.

        This analysis produced the following valuation data:

 
   TTM
EBITDA
   2003
EBITDA
Enterprise Value Multiples        
  Mean   13.0x   11.1x
  Median   12.8x   10.9x

 
 
TTM
EPS
 
2003
EPS
Equity Value Multiples        
  Mean   27.8x   24.1x
  Median   30.1x   24.4x

        Legg Mason derived a range of estimated values by applying the above-referenced mean Enterprise and Equity Value Multiples of the comparable companies to Whitman's appropriate financial statistics. Legg Mason ultimately derived an equity value per share for each multiple after taking into account Whitman's cash of $18.48 million as of December 31, 2002, debt of $8.04 million as of December 31, 2002, assuming a per share merger consideration of $14.25, and the diluted number of shares outstanding of 17,083,289 as of March 10, 2003. Legg Mason applied the comparable companies' mean and median multiples to Whitman's TTM EBITDA, 2003 EBITDA, TTM EPS and 2003 EPS and calculated an equity value per share. The resulting implied equity values per share ranged from $10.83 to $17.38.

40


        Legg Mason conducted an analysis of premiums paid in transactions from January 1, 2002 through March 24, 2003 involving acquisitions of publicly traded companies that had enterprise values between $100 and $300 million as a method of valuing Whitman. A premium paid analysis reviews and analyzes transactions and the resulting implied share prices involving comparable public companies that have been acquired. By comparing a target's share price prior to the announcement date of the acquisition to the price at which it is acquired, a premium paid analysis determines what percentage of a premium or discount the acquiror paid.

        In performing this analysis, Legg Mason utilized the data from the transactions described above to derive mean and median percentage premiums paid on a one day, one week and one month prior to announcement date and compared these results to Whitman's share price one day, one week and one month prior to March 24, 2003.

        This analysis produced the following valuation data:

% Premium
   One Day Prior
   One Week Prior
   One Month Prior
  
Mean   30.2 % 34.7 % 37.7 %
Median   24.4 % 32.1 % 37.4 %

        Legg Mason derived a range of estimated equity share prices based upon applying the above-mentioned mean and median premiums paid to Whitman's share price one day, one week and one month prior to March 24, 2003. The resulting implied equity values per share ranged from $12.26 to $12.82.

        Legg Mason conducted an analysis of merger and acquisition transactions involving postsecondary education companies, collectively referred to as the comparable transactions, as a method of valuing Whitman. A comparable transactions analysis reviews and analyzes transactions and the resulting implied multiples, involving companies in the same industries as Whitman. In performing this analysis, Legg Mason considered that the merger and acquisition transaction environment varies over time because of, among other things, interest rate and equity market fluctuations and industry results and growth expectations. Likewise, valuations and their implied multiples will vary over time with market conditions. No acquired company or business used in the comparable transactions analysis is identical or substantially identical to Whitman.

        Legg Mason analyzed the acquisition of publicly traded and privately held postsecondary companies and calculated the acquisition multiples paid for these companies. The range of multiples of these transactions was then applied to Whitman's financial results. These multiples included enterprise value to TTM Revenues, enterprise value to TTM EBITDA and enterprise value to TTM EBIT (earnings before interest and taxes). Legg Mason calculated the mean and median multiples for each of these categories based on these comparable transactions.

        For the purposes of this analysis, the comparable transactions selected by Legg Mason were the following acquisitions of postsecondary education companies:

        DeVry, Inc.'s acquisition of Ross University (pending);

        Corinthian Colleges, Inc.'s acquisition of Wyo-Tech Acquisition Corp.;

        Education Management Corporation's acquisition of Argosy Education Group;

        CEC's acquisition of Pennsylvania Culinary Institute;

        CEC's acquisition of EduTrek International, Inc.; and

        Kaplan Educational Centers acquisition of Quest Education, Inc.

41

        This analysis produced the following valuation data:

 
   TTM
Revenues
   TTM
EBITDA
   TTM
EBIT
Enterprise Value Multiples            
  Mean   2.3x   10.4x   13.6x
  Median   1.5x   10.8x   13.6x

        Legg Mason derived a range of estimated values based upon implied enterprise values and equity values derived by applying the above-mentioned mean and median Enterprise Value Multiples of the comparable transactions analysis to Whitman's appropriate financial statistics. If Legg Mason believed that the multiple for a particular comparable transaction was extremely high, Legg Mason excluded that multiple and relied upon the multiples of the other comparable transactions.

        Legg Mason then applied the comparable transactions multiples obtained to Whitman's TTM Revenues, TTM EBITDA and TTM EBIT to determine an approximate valuation after taking into account Whitman's cash of $18.48 million and debt of $8.04 million as of December 31, 2002. In deriving the equity value per share, Legg Mason used the diluted number of Whitman shares of common stock outstanding of 17,083,289 as of March 10, 2003. The resulting implied equity values per share ranged from $8.84 to $14.52. Legg Mason placed little emphasis on the per share values implied by the revenue mean and median multiples ($14.52 and $10.15) primarily because merger transactions involving companies with positive cash flow are generally valued on multiples of EBITDA and EBIT (earnings before interest and taxes) rather than revenue.

        Legg Mason performed a discounted cash flow analysis premised upon the assumptions summarized below. The discounted cash flow analysis was based upon the financial and operating information relating to Whitman's business, operations and prospects prepared and provided by Whitman's management and covering fiscal years 2004 through 2007.

        Using a discount rate of 13% to 18%, Legg Mason calculated the present value of the projected stream of net unlevered cash flow (as defined below) for fiscal years 2004 through 2007 and the present cash value of Whitman's terminal value at March 31, 2007. Legg Mason applied the discount rate derived from Whitman's implied weighted average cost of capital (using a pricing model known as the capital asset pricing model and based on general and systemic risk factors reflected by Whitman). "Net unlevered cash flow," as used in the analysis, means, for each period, projected EBIT, less taxes at an estimated rate of 40.5%, plus projected depreciation and amortization, less projected capital expenditures, plus or minus projected changes in non-cash working capital. The terminal value was computed by multiplying Whitman's projected EBITDA by terminal multiples of 5.0x to 7.0x. Legg Mason adjusted the calculated present value of the net unlevered cash flow and terminal value by adding Whitman's cash and cash equivalents and subtracting Whitman's debt, to calculate a range of equity values for Whitman.

42


        This analysis produced the following valuation data:

 
   Terminal EBITDA Multiple
Discount Rate 13%     5.0x     6.0x     7.0x
Implied Equity Value per Share   $ 14.31   $ 16.36   $ 18.40

 
 
Terminal EBITDA Multiple
Discount Rate 15.5%     5.0x     6.0x     7.0x
Implied Equity Value per Share   $ 13.39   $ 15.29   $ 17.19

 
 
Terminal EBITDA Multiple
Discount Rate 18%     5.0x     6.0x     7.0x
Implied Equity Value per Share   $ 12.55   $ 14.32   $ 16.08

        Based on the discount rate and range of terminal multiples referred to above, Legg Mason calculated a range of equity values of $214.5 million to $314.4 million, after adding Whitman's cash of $18.48 million as of December 31, 2002 and subtracting its debt of $8.04 million as of December 31, 2002. Legg Mason then derived the implied equity value per share using the diluted number of Whitman shares of common stock outstanding as of March 10, 2003. The implied equity value per share is a range of $12.55 to $18.40. Legg Mason placed little emphasis on this analysis primarily because the resulting implied per share values were based on management prepared financial projections, which reflected substantial increases in EBITDA and margin improvement from 2004 through 2007 in contrast to Whitman's historical results for the last three years.

        The above summary does not purport to be a complete description of the analyses performed by Legg Mason or of its presentation to the Whitman board of directors. The preparation of a fairness opinion is a complex process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of these methods to the particular circumstances and, therefore, is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analysis or the summary set forth above, without considering the analysis as a whole, could create an incomplete view of the processes underlying the opinion of Legg Mason. In arriving at its fairness determination, Legg Mason considered the results of all these constituent analyses and, except as described in this summary, did not attribute any particular weight to any particular factor or analysis considered by it. Rather, Legg Mason made its determination as to fairness on the basis of its experience and professional judgment after considering, among other things, that a merger consideration of $14.25 per share received by Whitman's shareholders would be within the range implied by the results of such analyses. No company or transaction used in any of the above analyses as a comparison is directly comparable to Whitman or the merger. Analyses based upon forecasts of future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by such analyses.

        Legg Mason is a nationally recognized investment banking firm that has substantial experience in, among other things, the valuation of businesses and securities in connection with mergers, acquisitions, underwritings, sales and distributions of listed and unlisted securities, private placements and valuations for estate, corporate and other purposes. In the ordinary course of its business, Legg Mason may actively trade in CEC's securities for its own account and the accounts of its customers, and accordingly, may at any time hold a long or short position in CEC's securities. Legg Mason also provides equity research coverage of CEC.

        In consideration of Legg Mason's services as Whitman's financial advisor, Whitman paid Legg Mason a nonrefundable fee of $25,000 upon execution of the engagement letter and $275,000 upon Legg Mason's delivery of its opinion. No portion of the initial fee would have been refundable if Legg

43


Mason was unable to provide an opinion that the consideration to be received by Whitman's shareholders in the merger was fair, from a financial point of view, and no portion of either fee would have been refundable if Whitman determined not to proceed with the merger. If the merger closes, Whitman has agreed to pay Legg Mason an additional fee in an amount equal to .70% of the aggregate consideration paid, directly or indirectly, by CEC in the merger, including the aggregate merger consideration received by Whitman's shareholders and option holders. The fee payable to Legg Mason upon consummation of the merger is estimated to be approximately $1.8 million (assuming the $8.25 value of CEC common stock included in the merger consideration is not adjusted pursuant to the merger agreement).

        Whitman has also agreed to reimburse Legg Mason for up to $50,000 of its out-of-pocket expenses incurred in connection with the performance of its services rendered under the engagement letter, and to indemnify Legg Mason and certain affiliated parties against certain liabilities, including liabilities under the federal securities laws, arising out of or in connection with the services rendered by Legg Mason under its engagement letter.

Merger Consideration

        If we complete the merger, we will exchange each outstanding share of Whitman common stock for $6.00 in cash and a to-be-determined number of shares of CEC common stock. The value of the CEC common stock component will be approximately $8.25, but is subject to adjustment. The value of CEC common stock to be issued in exchange for each share of Whitman common stock will be determined based upon the average closing price of CEC common stock reported on the Nasdaq National Market for the pricing period, which is the 20-day trading period ending on, and including, the second trading day prior to the day of the closing of the merger. In addition to $6.00 in cash, if the average closing price of CEC common stock for the pricing period is:

The exact number of shares of CEC common stock that you will receive will be determined by the merger exchange ratio. The exchange ratio is (1) the value of the CEC common stock to be issued in the merger per share of Whitman common stock (as determined by reference to the average closing price of CEC common stock during the pricing period) divided by (2) the average closing price of CEC common stock during the pricing period, unless the exchange ratio is fixed as shown in the table below. The following table shows how we will adjust the value or number of shares of CEC common stock

44


that you receive for each of your shares of Whitman common stock, based upon the average closing price of CEC common stock reported on the Nasdaq National Market during the pricing period.

Average Closing Price of CEC Common Stock
During the Pricing Period
   Value/Number of Shares of CEC Common Stock
per Share of Whitman Common Stock
Less than $37.00(1)   Number of shares based on a fixed exchange ratio of 0.204
At least $37.00, but less than $44.00   Valued at $8.25 less $0.10 per dollar that the average closing price during the pricing period is below $44.00, subject to proportionate adjustment for fractions of a dollar
At least $44.00, but less than $58.00   Valued at $8.25
At least $58.00, but no more than $65.00   Valued at $8.25 plus $0.10 per dollar that the average closing price during the pricing period is above $58.00, subject to adjustment for fractions of a dollar
Greater than $65.00(2)   Number of shares based on a fixed exchange ratio of 0.138
(1)
If the average closing price of CEC common stock during the pricing period is less than $37.00, Whitman has the option to terminate the merger agreement unless CEC agrees to issue CEC common stock valued at $7.55 for each share of Whitman common stock.

(2)
If the average closing price of CEC common stock during the pricing period is greater than $65.00, CEC has the option to terminate the merger agreement unless Whitman agrees to have CEC issue common stock valued at $8.95 for each share of Whitman common stock.

        The following table provides some examples of how the formula above works to determine the exchange ratio and the corresponding values of the CEC common stock and the total merger consideration that you would receive for a share of Whitman common stock at various average closing prices of CEC common stock during the pricing period. The exchange ratio will be calculated to the nearest one-thousandth. As a result, the values listed below are approximations.

Average Closing
Price of CEC
Common Stock
During the
Pricing Period
   Exchange Ratio
   Value of CEC
Common Stock Per
Share of Whitman
Common Stock
   Cash Per Share
of Whitman
Common Stock
   Total Value of Cash
and CEC Common Stock
Per Share of
Whitman
Common Stock
$37   0.204   $ 7.55   $ 6.00   $ 13.55
$39   0.199   $ 7.75   $ 6.00   $ 13.75
$41   0.194   $ 7.95   $ 6.00   $ 13.95
$44 - $58   0.188 - 0.142   $ 8.25   $ 6.00   $ 14.25
$60   0.141   $ 8.45   $ 6.00   $ 14.45
$63   0.139   $ 8.75   $ 6.00   $ 14.75
$65   0.138   $ 8.95   $ 6.00   $ 14.95

        We expect the market price of CEC common stock to fluctuate prior to the merger. Therefore, because the value and number of shares of CEC common stock you receive in the merger is determined based upon the average closing price of CEC common stock during the pricing period, you should obtain current stock price quotations for CEC common stock prior to voting on the merger. You should also note that because the exchange ratio is fixed two trading days before the closing of the merger and we expect the market price of CEC common stock to fluctuate, the value of the CEC common stock that you will receive in the merger may increase or decrease during the two-day trading period between the end of the pricing period and the closing of the merger.

45

        CEC will not issue fractional shares of CEC common stock in the merger. Instead, each holder of Whitman common stock that would otherwise be entitled to a fractional share of CEC common stock in the merger will be paid an amount in cash equal to such fractional share of CEC common stock multiplied by the average closing price of CEC common stock during the pricing period.

        Based upon 15,445,115 shares of Whitman common stock outstanding as of May 23, 2003 and an assumed exchange ratio of 0.141, which is based on the average closing market price of CEC common stock during the 20 consecutive trading days ended May 23, 2003 of $59.87, CEC will issue an aggregate of approximately 2,177,761 shares of CEC common stock in the merger to the holders of these shares of Whitman common stock. Based upon the 46,698,278 shares of CEC common stock outstanding as of May 23, 2003 the holders of these shares of Whitman common stock collectively will hold approximately 4.5% of the shares of CEC common stock outstanding immediately after the merger.

        CEC expects to borrow under its $200 million credit facility the funds necessary to pay the cash consideration payable to Whitman's shareholders and option holders in the merger.

Treatment of Outstanding Whitman Stock Options

        Each outstanding option to purchase Whitman common stock, whether vested or unvested, will be cancelled upon consummation of the closing and exchanged for cash equal to the positive difference, if any, between (1) the value, in cash, of the per share merger consideration (with the portion payable in CEC common stock being valued as of the second trading day prior to the closing of the merger) and (2) the per share exercise price of the option. Based upon CEC's average closing stock price of $59.87 for the 20-day period ended May 23, 2003 and the options to purchase 2,723,079 shares of Whitman common stock outstanding as of May 23, 2003 that have an exercise price below $14.44, CEC will pay an aggregate of approximately $27,040,174 to Whitman option holders after completion of the merger.

Termination of Whitman Employee Stock Purchase Plan

        The most recent offering period under Whitman's employee stock purchase plan ended March 31, 2003 and Whitman will not commence any additional offering periods unless the merger agreement is terminated. Any options to purchase Whitman common stock outstanding as of March 31, 2003 under Whitman's employee stock purchase plan were exercised in accordance with the plan. Whitman's employee stock purchase plan will terminate as of the consummation of the merger unless terminated earlier by Whitman's board of directors.

Payoff of Whitman Term Loan and Credit Facility

        Whitman has a capital expenditure term loan that is payable in monthly installments of principal and interest with a balloon payment due in April 2006 and a $3.5 million line of credit that expires on October 31, 2003. The interest rate of the capital expenditure term note and the line of credit is variable and is equal to the sum of 2.40% and the 1-month LIBOR rate. At April 28, 2003, the interest rate on these loans was 3.72%. At April 28, 2003, Whitman had $4.6 million outstanding under the terms of its capital expenditure term loan, no outstanding balance under its credit facility and letters of credit outstanding under the credit facility of $618,411, which reduced the amount available for borrowing under the credit facility. These loans are secured by substantially all of Whitman's assets. Whitman will repay these loans in full prior to closing the merger.

Interests of Whitman Directors and Executive Officers in the Merger

        In considering the recommendation of the Whitman board of directors, and support of Whitman executive officers, with respect to the merger agreement, shareholders of Whitman should be aware that certain directors and executive officers of Whitman have interests in the merger that are different

46


from, or in addition to, their interests as shareholders of Whitman generally. The Whitman board of directors was aware of these interests and considered them, among other matters, in approving the merger.

        Stock Options.    When we complete the merger, all outstanding Whitman stock options, including those held by executive officers and directors, whether or not vested, will be cancelled and exchanged for cash in an amount per share equal to the difference, if any, between (1) the equivalent cash value of the per share merger consideration (with the portion payable in CEC common stock being valued as of the second trading day prior to the closing of the merger) and (2) the exercise price of the option. Based upon CEC's average closing stock price of $59.87 for the 20-day period ended May 23, 2003 and the outstanding options to purchase 1,523,900 shares of Whitman common stock held by Whitman executive officers and directors as of May 23, 2003 that have an exercise price below $14.44, CEC will pay an aggregate of approximately $15,086,610 to Whitman executive officers and directors after completion of the merger.

        Severance Benefits.    Richard C. Pfenniger, Jr., Whitman's chief executive officer and vice chairman of the board, entered into a severance, non-competition, non-solicitation and confidentiality agreement with Whitman and CEC that entitles him to (1) payments of $50,000 per month for a period of nine months following the merger, or $450,000 in the aggregate, and (2) partial payment of his COBRA health coverage premiums for up to 12 months. Mr. Pfenniger will not be employed by CEC or its affiliates after the merger. Fernando Fernandez, Whitman's chief financial officer, entered into a letter agreement with CEC entitling him to (1) severance compensation payable in a lump sum of $150,000, and (2) partial payment of his COBRA health coverage premiums for up to 12 months following the merger. Mr. Fernandez may not be employed by CEC or its affiliates after the merger.

        Indemnification and Insurance.    If we complete the merger, CEC will indemnify, as and to the extent presently provided in Whitman's charter, bylaws and indemnification agreements, each person who was on or prior to March 26, 2003, or who becomes prior to the completion of the merger, a director or officer of Whitman for liabilities incurred due to acting in such capacity. For at least six years following consummation of the merger, CEC will also maintain Whitman's directors' and officers' liability insurance.

Accounting Treatment

        CEC will account for the merger as a "purchase" in accordance with U.S. generally accepted accounting principles. Consequently, CEC will allocate the aggregate consideration paid by it in connection with the merger to the surviving corporation's tangible and identifiable intangible assets and liabilities based upon their fair values, with any excess being treated as goodwill. CEC will include the revenues and expenses of Whitman in CEC's consolidated financial statements from the date of consummation of the merger.

Material Federal Income Tax Consequences

        The following summary discusses the material United States federal income tax consequences of the merger to Whitman shareholders. This discussion is based upon the United States Internal Revenue Code of 1986, Treasury regulations, administrative rulings and judicial decisions currently in effect, all of which are subject to change, possibly with retroactive effect. The discussion assumes that the Whitman shareholders currently hold their Whitman stock and will continue to hold that stock as a capital asset within the meaning of section 1221 of the Internal Revenue Code. Further, the discussion does not address all aspects of United States federal income taxation that may be relevant to a particular shareholder in light of his, her or its personal circumstances or to shareholders subject to special treatment under the United States federal income tax laws, including:

47

        Furthermore, this discussion does not consider the potential effects of any state, local or foreign tax laws.

        Neither CEC nor Whitman has requested a ruling from the Internal Revenue Service with respect to any of the United States federal income tax consequences of the merger and, as a result, there can be no assurance that the Internal Revenue Service will not disagree with or challenge any of the conclusions described below.

        Holders of Whitman common stock are urged to consult their own tax advisors regarding the specific tax consequences to them of the merger, including the applicability and effect of federal, state, local and foreign income or other tax laws in their particular circumstances.

        Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. will provide an opinion for the benefit of the shareholders of Whitman regarding the income tax consequences of the merger to Whitman shareholders. The opinion will rely on assumptions, including assumptions regarding the absence of changes in existing facts and the completion of the merger in accordance with the proxy statement/prospectus and the merger agreement. The opinion will also rely on representations and covenants, including those contained in officers' certificates of Whitman. Any change in currently applicable law, which may or may not be retroactive, or failure of any of the factual representations or assumptions to be true, correct and complete in all material respects, could affect the conclusions to be reached in the Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. tax opinion.

        The conclusions to be reached in the Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. tax opinion regarding the tax treatment to Whitman shareholders are:

48

        Unless you comply with certain reporting and/or certification procedures or are an exempt recipient under applicable provisions of the Internal Revenue Code and Treasury regulations, cash payments in exchange for your Whitman common stock in the merger may be subject to "backup withholding" at a rate of 30% for federal income tax purposes. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against the holder's federal income tax liability, provided the required information is furnished to the Internal Revenue Service.

        The preceding summary of the federal tax consequences of the merger does not purport to be a complete analysis or discussion of all potential tax effects relevant to the merger. This discussion is included for general information purposes only and may not apply to a particular shareholder in light of the shareholder's particular circumstances. You are urged to consult your own tax advisors as to the specific tax consequences to you of the merger, including tax return reporting requirements, the applicability and effect of federal, state, local, foreign and other applicable tax laws and the effect of any proposed changes in the tax laws.

Regulatory Matters

        Antitrust.    Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, CEC and Whitman are prohibited from completing the merger until:

        On May 21, 2003, in connection with the merger, CEC and Whitman each filed a Pre-Merger Notification and Report Form under the Hart-Scott-Rodino Act with the Federal Trade Commission and the Antitrust Division of the U.S. Justice Department. The waiting period under the Hart-Scott-Rodino Act relating to the merger is expected to expire on June 20, 2003. We, however, have requested early termination of the waiting period.

        Even after the waiting period under the Hart-Scott-Rodino Act expires, at any time before or after the merger, the Antitrust Division or the Federal Trade Commission could, among other things, seek to enjoin the completion of the merger or seek the divestiture of substantial assets of CEC or Whitman. Although CEC and Whitman believe that the merger is legal under U.S. antitrust laws, there can be no assurance that a challenge to the merger on antitrust grounds will not be made or, if a challenge is made, that it would not be successful.

        Education Regulation.    Completion of the merger is subject to approval and notice requirements imposed by education regulatory and accrediting agencies. Whitman is in the process of providing notice to, or obtaining approval of the merger from, the Georgia Nonpublic Postsecondary Education Commission, the Colorado Commission on Higher Education, the Florida Commission for Independent

49


Education, the Illinois State Board of Education, the Maryland Higher Education Commission, the Massachusetts Department of Education, the New Jersey Department of Education, the New York State Education Department, the Ohio State Board of Career Colleges and Schools, the Texas Workforce Commission, the North Central Association of Colleges and Schools, the Accrediting Bureau of Health Education Schools, the Missouri Coordinating Board for Higher Education, the Pennsylvania State Board of Private Licensed Schools, the Accrediting Council for Independent Colleges and Schools and the Missouri State Board of Nursing. The parties also plan to obtain confirmation from the U.S. Department of Education that it sees no substantial impediment to issuing a temporary program participation agreement with respect to each of Whitman's educational institutions after completion of the merger. In addition, Whitman is in the process of providing notice to and obtaining approval of the merger, if necessary, from certain additional accrediting and state agencies that accredit or approve individual educational programs of certain schools or that regulate participation in certain non-federal financial aid programs, as well as relevant guaranty agencies. Under the merger agreement, Whitman and CEC must obtain prior to closing all approvals and consents from governmental entities that are necessary to complete the merger. Under Department of Education regulations, Department of Education approval, which effectively permits Whitman to continue to access federal student financial aid funding, can only be obtained after the merger has been consummated. In addition, certain other approvals and consents of applicable state and accrediting agencies with respect to the merger can only be obtained after the consummation of the merger. There can be no assurance that any necessary approvals and consents will be obtained.

        Federal Securities Laws.    The shares of CEC common stock issued in connection with the merger will be registered under the Securities Act and will be freely transferable under the Securities Act, except for shares of CEC common stock issued to any person who is deemed to be an "affiliate" of Whitman on the date of the special meeting. Persons who may be deemed to be affiliates include individuals or entities that control, are controlled by, or are under the common control of Whitman and may include executive officers, directors and significant shareholders of Whitman. Affiliates of Whitman may not sell their shares of CEC common stock acquired in connection with the merger except pursuant to:

        As provided by the merger agreement, Whitman has obtained from each of its affiliates (for purposes of Rule 145 of the Securities Act) a written agreement providing that the affiliate will not sell, pledge, transfer or otherwise dispose of any CEC common stock issued to the affiliate pursuant to the merger, except in compliance with Rule 145 or an exemption from the registration requirements of the Securities Act.

        CEC's registration statement on Form S-4, of which this proxy statement/prospectus forms a part, does not cover the resale of shares of CEC common stock to be received by Whitman affiliates in the merger.

        Nasdaq National Market.    CEC will prepare and file with the Nasdaq National Market a Notification for the Listing of Additional Shares for the shares of CEC common stock to be issued in connection with the merger. When we complete the merger, Whitman common stock will be delisted from the American Stock Exchange and deregistered under the Exchange Act.

Appraisal Rights

        Whitman shareholders are not entitled to dissenter's or appraisal rights under the Florida Business Corporation Act in connection with the merger.

50


THE MERGER AGREEMENT

        The following summary of the merger agreement is qualified in its entirety by reference to the complete copy of the merger agreement attached as Annex A to this proxy statement/prospectus and incorporated in this proxy statement/prospectus by reference. We urge you to read the merger agreement carefully and in its entirety.

Whitman Stock Certificate Exchange Procedures

        Promptly after we complete the merger, the exchange/paying agent will mail to each registered holder of Whitman common stock (1) a letter of transmittal and (2) instructions for surrendering the holder's Whitman stock certificate(s) in exchange for certificates representing shares of CEC common stock and cash. Upon surrendering a Whitman stock certificate, together with a signed letter of transmittal and any other required documents, to the exchange/paying agent, each Whitman shareholder will be entitled to receive certificates representing the whole number of shares of CEC common stock that the shareholder has the right to receive and a check for the cash payable to the shareholder. No interest will be paid on any cash to be paid pursuant to the merger. You should not surrender your stock certificates for exchange until you receive a letter of transmittal from the exchange/paying agent.

        If any Whitman stock certificate has been lost, stolen or destroyed, CEC will require the owner of such lost, stolen or destroyed Whitman stock certificate to provide an appropriate affidavit and may require the owner to deliver a bond as indemnity against any claim that may be made against us with respect to the Whitman stock certificate.

Directors and Officers of Whitman after the Merger

        Under the merger agreement, the directors of Marlin Acquisition Corp. immediately prior to the merger, all of whom are officers of CEC, will be the initial directors of the surviving corporation at and after the merger, and the officers of Marlin Acquisition Corp. immediately prior to the merger, all of whom are officers of CEC, will be the initial officers of the surviving corporation at and after the merger.

Representations and Warranties

        The merger agreement contains customary representations and warranties by CEC and/or Whitman relating to, among other things:

51


Covenants

        Conduct of Business.    Pursuant to the merger agreement, Whitman has agreed that, except as permitted or contemplated by the merger agreement or as consented to by CEC in writing, during the period from the date of the merger agreement to the completion of the merger, Whitman will:

        The merger agreement provides that Whitman will not, among other things and with some exceptions:

52

        In addition, CEC has agreed that it will carry on its business in the ordinary course and not take any action that would reasonably be expected to result in any of the conditions to the merger not being satisfied.

        No Solicitation.    The merger agreement provides that Whitman will not, and will not permit its directors, officers, employees, investment bankers, attorneys, accountants or other representatives, agents or affiliates to:

53

However, if a third party submits an unsolicited, written acquisition proposal, and Whitman's board of directors reasonably determines in good faith, after consultation with outside legal counsel and any nationally recognized investment bank, that the acquisition proposal will, or upon further discussion or due diligence could reasonably be expected to, result in a superior proposal (as defined below), then Whitman may (1) furnish information about its business to the third party and (2) negotiate and participate in discussions and negotiations with the third party. If Whitman's board of directors determines that the acquisition proposal is a superior proposal (as defined below), Whitman's board of directors may withdraw or adversely modify its recommendation of the merger, but must still allow Whitman shareholders to vote on the merger at the special meeting. Whitman will advise CEC if it receives a superior proposal, identifying the third party and specifying the material terms and conditions of the superior proposal.

        The merger agreement requires Whitman to promptly advise CEC if (1) an acquisition proposal is made or modified, (2) a request for information is made that could lead to an acquisition proposal or (3) Whitman furnishes non-public information to, or enters into discussions regarding an acquisition proposal with, any third party. Whitman must also keep CEC informed about any such proposal or request.

        An "acquisition proposal" is any proposal relating to a possible:

        A "superior proposal" is an unsolicited, bona fide, written acquisition proposal:

54

Conditions to the Merger

        CEC and Whitman.    CEC's and Whitman's obligations to effect the merger are subject to the satisfaction or waiver of various conditions, including the following:

        Whitman.    The obligations of Whitman to consummate the merger are further subject to the fulfillment of the following conditions, any of which may be waived in whole or part by Whitman:

55

        CEC.    The obligations of CEC to consummate the merger are further subject to the fulfillment of the following conditions, any of which may be waived in whole or part by CEC:

Termination, Termination Fee, Amendment and Waiver

        Termination.    The merger agreement may be terminated at any time prior to the completion of the merger, whether before or after Whitman shareholder approval:

56

        Termination Fee.    Whitman must pay CEC a fee of $10.0 million, plus up to $1.5 million of CEC's cost and expenses in connection with the merger, if:

57

        The termination fee could discourage another company from making a competing takeover proposal that could be more advantageous to Whitman's shareholders than the merger because this fee may make the competing proposal more difficult or expensive and could deter Whitman from entering into an alternative transaction.

        Amendment.    The merger agreement may be amended by CEC and Whitman at any time before or after the shareholders' approval of the merger agreement. The merger agreement may not be amended except by an instrument in writing signed on behalf of both CEC and Whitman.

        Extension; Waiver.    At any time prior to the merger, CEC or Whitman may:

Any agreement on the part of CEC or Whitman to any such extension or waiver will be valid only if it is set forth in an instrument in writing signed on behalf of that party.


THE VOTING AGREEMENT

        The following summarizes the material terms of the voting agreement. This summary is qualified in its entirety by reference to the voting agreement, which is incorporated by reference as an exhibit to the registration statement of which this proxy statement/prospectus is a part.

        In connection with the execution of the merger agreement on March 26, 2003, Phillip Frost, M.D., a trust for which Mr. Frost is the sole trustee, Richard C. Pfenniger, Jr. and Fernando L. Fernandez, the beneficial owners of an aggregate of approximately 27.1% of Whitman's common stock outstanding as of the record date, entered into the voting agreement with CEC. Pursuant to, and subject to the terms of, the voting agreement, these Whitman shareholders have agreed to appear at the special meeting and vote the shares of Whitman common stock for which they have voting power in favor of the merger and against any other "acquisition proposal" and have granted to CEC, subject to and conditioned upon CEC's receipt of all required regulatory approvals, if any, the shareholders' irrevocable proxy for such actions and agreed not to take any other action that could adversely affect the voting agreement or the merger agreement. The shareholders further agreed not to assign their shares other than to certain permitted transferees, grant any proxies or enter into any voting trusts with respect to their shares, or take any action which would be a breach of any representation or warranty in the voting agreement.

58



INFORMATION ABOUT OUR COMPANIES

CEC

        CEC is a provider of private, for-profit post-secondary education with 51 campuses throughout the United States, Canada, France, the United Kingdom and the United Arab Emirates. CEC also offers online programs through American InterContinental University-Online, its e-learning division. CEC's student population as of April 30, 2003 was approximately 54,400. CEC's schools enjoy long operating histories and offer a variety of master's degree, bachelor's degree, associate's degree, and diploma programs in career-oriented disciplines.

        CEC was founded in January 1994 by John M. Larson, its chairman, president and chief executive officer, who has over 29 years of experience in the career-oriented education industry. CEC was formed to capitalize on opportunities in the large and highly fragmented post-secondary school industry. Since its inception, CEC has completed 25 acquisitions and has opened four branch start-up campuses. CEC has acquired schools that it believes possess strong curricula, leading reputations and broad marketability, but that have been under managed from a marketing and/or financial standpoint. CEC seeks to apply its expertise in operations, marketing and curricula development, as well as its financial strength, to improve the performance of these schools.

        CEC's schools offer educational programs principally in the following five career-related fields of study, identified by CEC as areas with highly interested and motivated students, strong entry-level employment opportunities and ongoing career and salary advancement potential:

Whitman

        Whitman is a proprietary provider of career-oriented post-secondary education. Through three wholly-owned subsidiaries, Whitman currently operates 22 schools in 13 states offering a range of graduate, undergraduate and non-degree certificate or diploma programs primarily in the fields of information technology, healthcare and business. As of April 30, 2003, Whitman's student population was approximately 10,000.

        Whitman is organized into a University Degree Division and an Associate Degree Division. Whitman's University Degree Division primarily offers doctorate, master's and bachelor's degrees through Colorado Technical University. Whitman's Associate Degree Division offers associate's degrees and diplomas or certificates through Sanford-Brown College and Ultrasound Diagnostics Schools. Sanford-Brown College also offers bachelor's degrees in business administration, information technology and healthcare administration.

        Whitman's students are predominantly adults who commute to Whitman's schools and require limited ancillary student services. The students are seeking to acquire basic knowledge and skills necessary for entry-level employment in technical careers or to acquire new or additional skills to either change careers or advance in their current careers.

59


UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL
STATEMENTS OF CEC AND WHITMAN

        The following unaudited pro forma condensed combined balance sheet as of March 31, 2003 gives effect to the proposed merger of CEC and Whitman as if the merger had occurred on March 31, 2003. The following unaudited pro forma condensed combined statements of income for the three months ended March 31, 2003 and the year ended December 31, 2002 give effect to the merger as if it had occurred on January 1, 2002. The unaudited condensed combined financial statements were prepared from (1) CEC's audited historical consolidated financial statements for the year ended December 31, 2002 and unaudited historical condensed consolidated financial statements as of, and for the three months ended, March 31, 2003 and (2) Whitman's audited historical consolidated financial statements as of, and for the year ended, March 31, 2003 and unaudited historical condensed consolidated financial statements for the nine months ended December 31, 2002.

        CEC and Whitman have different fiscal year-end dates. The unaudited pro forma condensed combined statement of income for the year ended December 31, 2002, CEC's most recently completed fiscal year, reflects Whitman's historical statement of income data for the twelve months ended March 31, 2003, which is Whitman's most recently completed fiscal year. Whitman's historical results of operations for the three months ended March 31, 2003 are included in the unaudited pro forma condensed combined statements of income for both the three months ended March 31, 2003 and the year ended December 31, 2002.

        The unaudited pro forma condensed combined financial statements include all adjustments necessary for a fair presentation of the data and, in the opinion of management, have been prepared on the same basis as that of the underlying audited financial statements. The unaudited pro forma condensed combined financial statements are a presentation of historical results with accounting adjustments necessary to reflect the estimated pro forma effect of the merger on the combined financial position and results of operations of CEC and Whitman. The unaudited pro forma condensed combined financial statements do not reflect the effects of any anticipated changes to be made by CEC to the historical operations, are presented for information purposes only, and should not be construed to be indicative of combined results of operations or financial position that actually would have occurred had the merger of CEC and Whitman been consummated as of the date indicated or the combined entity's future results of operations or financial position.

        The unaudited pro forma condensed combined balance sheet has been prepared using the purchase method of accounting for the proposed merger. The acquired assets and assumed liabilities of Whitman are stated in the unaudited pro forma condensed combined balance sheet as of March 31, 2003 at amounts representing an allocation of the estimated purchase price based upon a preliminary estimate of the fair values of the acquired assets and assumed liabilities at the assumed March 31, 2003 acquisition date.

        The unaudited pro forma condensed combined financial statements are based upon the financial condition and operating results of Whitman during periods when it was not under the control, influence or management of CEC. The information presented may not be indicative of the results of operations that would have actually occurred had the acquisition been completed as of January 1, 2002, nor is it necessarily indicative of the future financial condition or operating results of the combined entity. CEC expects to incur reorganization and integration expenses and experience operating efficiencies as a result of its acquisition of Whitman. The unaudited pro forma condensed combined financial statements do not give effect to these expenses or any synergies that may occur due to the integration of Whitman with CEC and should be read along with the historical financial statements of CEC and Whitman and the related notes incorporated by reference in this proxy statement/prospectus.

        Certain assets and liabilities in Whitman's historical unaudited condensed consolidated balance sheet as of March 31, 2003 have been reclassified in the accompanying unaudited pro forma condensed combined balance sheet to conform to CEC's balance sheet presentation. Certain expenses in Whitman's historical unaudited consolidated statement of income for the three months and twelve months ended March 31, 2003 have been reclassified in the accompanying unaudited pro forma condensed combined statement of income to conform to CEC's statement of income presentation.

60

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS OF MARCH 31, 2003
(In thousands)

 
   CEC
   Whitman
   Pro Forma Adjustments
   Pro Forma Combined
ASSETS                        

CURRENT ASSETS:
 
 
 
 
 
 
 
 
 
 
 
 
  Cash and cash equivalents   $ 27,139   $ 25,215   $ —   $ 52,354
  Receivables, net     90,746     26,907     —     117,653
  Inventories, prepaid expenses and other     37,881     4,185     —     42,066
  Deferred income tax assets     2,608     2,895     1,520 (a)   7,023
   
 
 
 
    Total current assets     158,374     59,202     1,520     219,096
   
 
 
 
PROPERTY AND EQUIPMENT, net     192,333     11,181     1,575 (b)   205,089
GOODWILL, net     214,280     9,289     203,578 (c)   427,147
INTANGIBLE ASSETS, net     11,692     —     22,090 (d)   33,782
OTHER ASSETS     43,495     2,099     —     45,594
   
 
 
 
TOTAL ASSETS   $ 620,174   $ 81,771   $ 228,763   $ 930,708
   
 
 
 

LIABILITIES & STOCKHOLDERS' EQUITY
 
 
 
 
 
 
 
 
 
 
 
 

CURRENT LIABILITIES:
 
 
 
 
 
 
 
 
 
 
 
 
  Current maturities of long-term debt   $ 3,529   $ 2,523   $ —   $ 6,052
  Accounts payable     20,577     2,408     4,000 (e)   26,985
  Accrued expenses     57,842     8,264     —     66,106
  Deferred tuition revenue     65,088     27,963     —     93,051
   
 
 
 
    Total current liabilities     147,036     41,158     4,000     192,194
   
 
 
 
LONG-TERM LIABILITIES:                        
  Long-term debt, net of current maturities     27,529     4,710     119,709 (f)   151,948
  Deferred income tax liabilities     2,358     1,642     8,959 (g)   12,959
  Other     11,717     —     —     11,717
   
 
 
 
    Total long-term liabilities     41,604     6,352     128,668     176,624
   
 
 
 
STOCKHOLDERS' EQUITY     431,534     34,261     96,095 (h)   561,890
   
 
 
 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY   $ 620,174   $ 81,771   $ 228,763   $ 930,708
   
 
 
 

61

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2003
(In thousands, except per share data)

 
   CEC
   Whitman
   Pro Forma Adjustments
   Pro Forma Combined
  
REVENUE   $ 245,543   $ 30,070   $ —   $ 275,613  

OPERATING EXPENSES:
 
 
 
 
 
 
 
 
 
 
 
 
 
  Educational services and facilities     92,143     15,772     —     107,915  
  General and administrative     113,276     8,574     (503 )(i)   121,347  
  Depreciation and amortization     9,185     984     39   (j)   10,208  
   
 
 
 
 
    Total operating expenses     214,604     25,330     (464 )   239,470  
   
 
 
 
 
    Income from operations     30,939     4,740     464     36,143  

OTHER INCOME (EXPENSE):
 
 
 
 
 
 
 
 
 
 
 
 
 
  Interest income     549     87     —     636  
  Interest expense     (342 )   (181 )   (1,272 )(k)   (1,795 )
  Share of affiliate earnings     1,166     —     —     1,166  
   
 
 
 
 
    Total other income     1,373     (94 )   (1,272 )   7  
   
 
 
 
 
    Income before provision for income taxes     32,312     4,646     (808 )   36,150  
PROVISION FOR INCOME TAXES     13,086     1,825     (270 )(l)   14,641  
   
 
 
 
 
NET INCOME   $ 19,226   $ 2,821   $ (538 ) $ 21,509  
   
 
 
 
 

NET INCOME PER SHARE:
 
 
 
 
 
 
 
 
 
 
 
 
 
  Basic   $ 0.42   $ 0.19         $ 0.45  
   
 
       
 
  Diluted   $ 0.40   $ 0.17         $ 0.43  
   
 
       
 

WEIGHTED AVERAGE SHARES OUTSTANDING:
 
 
 
 
 
 
 
 
 
 
 
 
 
  Basic     46,148     14,470     2,177     48,325  
   
 
       
 
  Diluted     48,071     16,268     2,177     50,248  
   
 
       
 

62

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 2002
(In thousands, except per share data)

 
   CEC
   Whitman
   Pro Forma Adjustments
   Pro Forma Combined
  
REVENUE   $ 780,059   $ 109,796   $ —   $ 889,855  

OPERATING EXPENSES:
 
 
 
 
 
 
 
 
 
 
 
 
 
  Educational services and facilities     294,539     61,317     —     355,856  
  General and administrative     338,586     31,932     503   (m)   371,021  
  Depreciation and amortization     33,636     3,636     248   (n)   37,520  
   
 
 
 
 
    Total operating expenses     666,761     96,885     751     764,397  
   
 
 
 
 
    Income from operations     113,298     12,911     (751 )   125,458  

OTHER INCOME (EXPENSE):
 
 
 
 
 
 
 
 
 
 
 
 
 
  Interest income     808     369     —     1,177  
  Interest expense     (2,094 )   (715 )   (5,088 )(o)   (7,897 )
  Share of affiliate earnings     2,348     —     —     2,348  
   
 
 
 
 
    Total other income     1,062     (346 )   (5,088 )   (4,372 )
   
 
 
 
 
    Income before provision for income taxes     114,360     12,565     (5,839 )   121,086  
PROVISION FOR INCOME TAXES     46,888     5,054     (2,296 )(p)   49,646  
   
 
 
 
 
NET INCOME   $ 67,472   $ 7,511   $ (3,543 ) $ 71,440  
   
 
 
 
 

NET INCOME PER SHARE:
 
 
 
 
 
 
 
 
 
 
 
 
 
  Basic   $ 1.49   $ 0.53         $ 1.50  
   
 
       
 
  Diluted   $ 1.42   $ 0.49         $ 1.44  
   
 
       
 

WEIGHTED AVERAGE SHARES OUTSTANDING:
 
 
 
 
 
 
 
 
 
 
 
 
 
  Basic     45,407     14,117     2,177     47,584  
   
 
       
 
  Diluted     47,547     15,435     2,177     49,724  
   
 
       
 

63


NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED
FINANCIAL STATEMENTS

1.     Basis of Presentation

        The unaudited pro forma condensed combined balance sheet as of March 31, 2003 gives effect to the proposed merger of CEC and Whitman as if the merger had occurred on March 31, 2003. The unaudited pro forma condensed combined statements of income for the three months ended March 31, 2003 and the year ended December 31, 2002 give effect to the merger as if it had occurred on January 1, 2002. The unaudited pro forma condensed combined financial statements were prepared from (1) CEC's audited historical consolidated financial statements for the year ended December 31, 2002 and unaudited historical condensed consolidated financial statements as of, and for the three months ended, March 31, 2003 and (2) Whitman's audited historical consolidated financial statements as of, and for the year ended, March 31, 2003 and unaudited historical condensed consolidated financial statements for the nine months ended December 31, 2002.

        CEC and Whitman have different fiscal year-end dates. The unaudited pro forma condensed combined statement of income for the year ended December 31, 2002, CEC's most recently completed fiscal year, reflects Whitman's historical statement of income data for the twelve months ended March 31, 2003, which is Whitman's most recently completed fiscal year. Whitman's historical results of operations for the three months ended March 31, 2003 are included in the unaudited pro forma condensed combined statements of income for both the three months ended March 31, 2003 and the year ended December 31, 2002.

        The unaudited pro forma condensed combined financial statements include all adjustments necessary for a fair presentation of the data and, in the opinion of management, have been prepared on the same basis as that of the underlying audited financial statements. The unaudited pro forma condensed combined financial statements are a presentation of historical results with accounting adjustments necessary to reflect the estimated effect of the merger on the combined financial position and results of operations of CEC and Whitman. The unaudited pro forma condensed combined financial statements do not reflect the effects of any anticipated changes to be made by CEC to the historical operations, are presented for information purposes only, and should not be construed to be indicative of combined results of operations or financial position that actually would have occurred had the merger of CEC and Whitman been consummated as of the date indicated or the combined entity's future results of operations or financial position.

        The unaudited pro forma condensed combined balance sheet has been prepared using the purchase method of accounting for the proposed merger. Accordingly, the estimated purchase price, including acquisition costs, of approximately $254.1 million has been allocated to the estimated fair values of acquired tangible and intangible assets of $97.7 million and assumed liabilities of $56.5 million as of March 31, 2003. Our preliminary purchase price allocation has resulted in goodwill totaling $212.9 million.

        The estimated purchase price of $254.1 million includes the estimated fair value of CEC common stock to be issued to Whitman shareholders of $130.4 million, cash to be paid to Whitman shareholders of $92.7 million, estimated cash to be paid to Whitman option holders of $27.0 million, and estimated acquisition costs of $4.0 million. Consideration to be paid to Whitman option holders, representing the difference between exercise price and per share merger consideration, will be recorded by Whitman as compensation expense in Whitman's statement of operations prior to closing as a result of modifications to be made to Whitman's option plans in advance of the merger.

        Certain assets and liabilities in Whitman's unaudited historical consolidated balance sheet as of March 31, 2003 have been reclassified in the accompanying unaudited pro forma condensed combined balance sheet to conform to CEC's balance sheet presentation. Certain expenses in Whitman's

64


unaudited historical consolidated statement of income for the three months ended March 31, 2003 and audited historical consolidated statement of income for the year ended December 31, 2002 have been reclassified in the accompanying unaudited pro forma condensed combined statement of income to conform to CEC's statements of income presentation.

2.     Merger Consideration

        Under the terms of the proposed merger agreement, CEC will acquire 100% of Whitman stock for a combination of cash and CEC common stock. Whitman shareholders will receive $6.00 in cash and a to-be-determined number of shares of CEC common stock. The value of the CEC common stock consideration component will be approximately $8.25, but is subject to adjustment. The value of CEC common stock to be issued in exchange for each share of Whitman common stock will be determined based on the average closing price of CEC common stock on the Nasdaq National Market for the 20-day trading period ending on, and including, the second trading day prior to the day of the closing of the merger.

        The exact number of shares of CEC common stock per share of Whitman common stock that each Whitman stockholder will receive will be determined by the merger exchange ratio. The exchange ratio is (1) the value of the CEC common stock to be issued in the merger per share of Whitman common stock divided by (2) the average closing price of CEC common stock during the pricing period, unless the exchange ratio is fixed as shown in the table below. The following table shows how the value or number of shares of CEC common stock that Whitman shareholders will receive for each share of Whitman common stock will be adjusted, based upon the average closing price of CEC common stock reported on the Nasdaq National Market during the pricing period.

Average Closing Price of CEC Common Stock
During the Pricing Period
   Value/Number of Shares of CEC Common Stock per
Share of Whitman Common Stock
Less than $37.00   Number of shares based on a fixed exchange ratio of 0.204

At least $37.00, but less than $44.00
 
Valued at $8.25 less $0.10 per dollar that the average closing price during the pricing period is below $44.00, subject to proportionate adjustment for fractions of a dollar

At least $44.00, but less than $58.00
 
Valued at $8.25

At least $58.00, but no more than $65.00
 
Valued at $8.25 plus $0.10 per dollar that the average closing price during the pricing period is above $58.00, subject to adjustment for fractions of a dollar

Greater than $65.00
 
Number of shares based on a fixed exchange ratio of 0.138

        If the average closing price of CEC common stock during the pricing period is less than $37.00, Whitman has the option to terminate the merger agreement unless CEC agrees to issue CEC common stock valued at $7.55 for each share of Whitman common stock. If the average closing price of CEC common stock during the pricing period is greater than $65.00, CEC has the option to terminate the merger agreement unless Whitman agrees to have CEC issue common stock valued at $8.95 for each share of Whitman common stock.

        The market price of CEC common stock is expected to fluctuate prior to the merger and the exchange ratio is fixed two trading days before the closing of the merger. Therefore, the average closing price of CEC common stock during the pricing period may be higher or lower than the closing price of CEC common stock on the date of the merger agreement, the date of the Whitman special meeting or the date that the merger is completed. Instead of issuing fractional shares, CEC will pay

65


cash for fractional shares based on the average closing price of CEC common stock during the pricing period.

        Based upon the approximately 15.4 million shares of Whitman common stock outstanding as of May 23, 2003 and an assumed exchange ratio of 0.141, which is based on the average closing market price of CEC common stock during the 20 consecutive trading days ended May 23, 2003 of approximately $59.87, CEC will issue an aggregate of approximately 2.2 million shares of CEC common stock in the merger to the holders of these shares of Whitman common stock. Based upon the approximately 46.7 million shares of CEC common stock outstanding as of May 23, 2003, the holders of these shares of Whitman common stock collectively will hold approximately 4.5% of the shares of CEC common stock outstanding immediately after the merger.

        Additionally, each outstanding option to purchase Whitman common stock, whether vested or unvested, will be cancelled upon consummation of the merger and exchanged for cash equal to the positive difference, if any, between (1) the equivalent cash value of the per share merger consideration (with the portion payable in CEC common stock being valued as of the second trading day prior to the closing of the merger) and (2) the per share exercise price of the option. This cash value of the per share merger consideration will adjust in the same manner as the value of the CEC common stock component of the per share merger consideration payable to Whitman shareholders. Assuming per share merger consideration of $14.44, a weighted average exercise price of $4.51, and approximately 2.7 million options to purchase Whitman common stock outstanding as of May 23, 2003, CEC will pay approximately $27.0 million to Whitman option holders upon consummation of the merger.

        CEC expects to borrow under its $200 million U.S. credit facility the funds necessary to pay the cash consideration payable to Whitman's shareholders and option holders in the merger.

3.     Pro Forma Balance Sheet Adjustments

(a)
Represents the deferred income tax asset recorded in connection with estimated acquisition costs of $4.0 million.

(b)
Represents the estimated fair value of acquired Whitman courseware of $1.6 million. Adjustments to acquired courseware may be made upon the finalization of the valuation of such asset.

(c)
Represents the excess of estimated purchase price, including acquisition costs, over the estimated fair value of identifiable tangible and intangible assets acquired and liabilities assumed, totaling approximately $203.6 million, net of goodwill of $9.3 million reflected on Whitman's historical consolidated balance sheet as of March 31, 2003. Total estimated goodwill of $212.9 million is based upon a preliminary allocation of the purchase price as of March 31, 2003. Adjustments to goodwill may be made upon the finalization of the purchase price allocation.

(d)
Represents the estimated fair value of acquired Whitman licensing, accreditation and Title IV participation rights of $10.0 million, Whitman trade names of $12.0 million, and a covenant not to compete agreement of $90,000. The licensing, accreditation and Title IV participation rights and trade names are indefinite-lived intangible assets and will not be subject to amortization. The covenant not to compete will be amortized on a straight-line basis over the nine-month term of the agreement. Adjustments to acquired intangible assets may be made upon the finalization of the valuation of such assets.

(e)
Represents estimated acquisition costs of $4.0 million, which includes, among other things, investment banking, legal and accounting costs. This amount does not include any costs incurred to integrate and restructure the operations of CEC and Whitman.

(f)
Represents estimated cash payments of (1) $92.7 million to Whitman shareholders and (2) $27.0 million to pay Whitman option holders the difference between the exercise price and the

66

(g)
Represents the deferred income tax liabilities recorded in connection with the estimated fair values of acquired courseware, licensing accreditation and Title IV participation rights, and trade names.

(h)
Reflects (1) the issuance of approximately 2.2 million shares of CEC common stock with an assumed total fair value of $130.4 million to holders of Whitman common stock in exchange for all outstanding shares of Whitman common stock and (2) an adjustment to eliminate stockholders' equity reflected on Whitman's historical consolidated balance sheet as of March 31, 2003. An assumed average stock price of $59.87 was used to value the CEC shares.

4.     Pro Forma Statement of Income Adjustments for the Three Months Ended March 31, 2003

(i)
Represents the elimination of expenses incurred in connection with the merger.

(j)
Represents additional depreciation expense of $39,000 associated with the depreciation of the estimated fair value of acquired courseware.

(k)
Represents the interest expense, at an assumed effective annual interest rate of 4.25%, incurred in connection with incremental debt financing of $119.7 million used to fund cash payments to Whitman shareholders and option holders.

(l)
Represents the pro forma adjustment necessary to reflect a combined effective income tax rate for the three months ended March 31, 2003 of 40.5%.

5.     Pro Forma Statement of Income Adjustments for the Year Ended December 31, 2002

(m)
Represents the elimination of expenses incurred in connection with the merger.

(n)
Represents additional depreciation expense of $158,000 associated with the depreciation of the estimated fair value of acquired courseware and additional amortization expense of $90,000 associated with the amortization of the estimated fair value of a nine-month covenant not to compete executed by a Whitman employee.

(o)
Represents the interest expense, at an assumed effective rate of 4.25%, incurred in connection with incremental debt financing of $119.7 million used to fund cash payments to Whitman shareholders and option holders.

(p)
Represents the pro forma adjustment necessary to reflect a combined effective income tax rate for the year ended December 31, 2002 of 41.0%.

67


COMPARISON OF RIGHTS OF STOCKHOLDERS OF CEC
AND SHAREHOLDERS OF WHITMAN

        CEC is incorporated under the laws of the State of Delaware, and Whitman is incorporated under the laws of the State of Florida. If the merger is completed, Whitman shareholders, whose rights are currently governed by the Florida Business Corporation Act ("FBCA"), the articles of incorporation of Whitman, as amended, and the bylaws of Whitman, as amended, will become stockholders of CEC, and their rights as such will be governed by the Delaware General Corporation Law ("DGCL"), CEC's certificate of incorporation, as amended, and CEC's bylaws, as amended. The material differences between the rights of holders of Whitman shares and the rights of holders of CEC shares, resulting from the differences in their governing documents and applicable state corporate law, are summarized below.

        The following summary does not purport to be a complete statement of the rights of holders of CEC shares under the applicable provisions of Delaware law, CEC's certificate of incorporation, as amended, and CEC's bylaws, as amended, or the rights of the holders of Whitman shares under the applicable provisions of Florida law, Whitman's articles of incorporation, as amended, and Whitman's bylaws, as amended, or a complete description of the specific provisions referred to herein. This summary contains a list of the material differences but is not meant to be relied upon as an exhaustive list or a detailed description of the provisions discussed. While CEC believes that the provisions of its amended and restated certificate of incorporation and its amended and restated bylaws are in its stockholders' best interests, shareholders of Whitman should be aware that these provisions could be disadvantageous to them because their overall effect may be to render more difficult or to discourage the removal of incumbent directors and management or the assumption of effective control by other persons. CEC has also implemented a stockholders' rights plan, commonly called a "poison pill," which could make an acquisition of CEC more difficult because it substantially reduces or eliminates the expected economic benefit to an acquiror from acquiring CEC in a manner or on terms not approved by the CEC board of directors. For more information as to how to obtain the full text of each document, see "Where You Can Find More Information" beginning on page 76.

SUMMARY OF MATERIAL DIFFERENCES BETWEEN THE RIGHTS OF CEC
STOCKHOLDERS AND THE RIGHTS OF WHITMAN SHAREHOLDERS

 
   WHITMAN
SHAREHOLDER RIGHTS
   CEC
STOCKHOLDER RIGHTS
AUTHORIZED CAPITAL STOCK:   The authorized capital stock of Whitman consists of 100,000,000 shares of common stock, no par value per share, of which 15,445,115 were outstanding at the close of business on May 23, 2003.   The authorized capital stock of CEC consists of 150,000,000 shares of common stock, $.01 par value per share, of which 46,698,278 were outstanding at the close of business on May 23, 2003, and 1,000,000 shares of preferred stock, $.01 par value per share (10,000 of which have been designated as Series A Preferred Stock), none of which was outstanding at the close of business on May 23, 2003.

VOTING RIGHTS:
 
The holders of Whitman common stock are entitled to one vote per share of common stock.
 
The holders of CEC common stock are entitled to one vote per share of common stock.
         

68


DIVIDENDS:
 
Under Section 607.06401 of the FBCA, Whitman may, subject to limitations in its articles of incorporation, make distributions to its shareholders unless, after giving effect to such distributions, Whitman would not be able to pay its debts as they become due in the usual course of business, or Whitman's total assets would be less than the sum of its total liabilities plus the amount that would be needed, if Whitman were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those receiving the distribution.
 
Under Section 170(a) of the DGCL, CEC may declare and pay dividends, subject to limitations in its certificate of incorporation, either out of its surplus or if there is no surplus, out of its net profits for the fiscal year in which the dividend is declared and/or the preceding year. Subject to the rights of the holders, if any, of preferred stock, holders of CEC stock will be entitled to receive dividends at such times and in such amounts as may be determined by the board of directors of CEC.

NUMBER OF DIRECTORS:
 
In accordance with the FBCA, Whitman's bylaws provide that the number of directors will be determined from time to time by resolution adopted by the affirmative vote of a majority of all directors. The Whitman board of directors currently consists of nine (9) directors. Each director holds office until the annual meeting next succeeding his or her election and until his or her successor is elected and qualified.
 
In accordance with the DGCL, CEC's certificate of incorporation provides that the board of directors consists of not less than five (5) nor more than nine (9) directors. The exact number is determined from time to time by resolution adopted by the affirmative vote of a majority of the board of directors in office at the time of adoption of such resolution. CEC's board is divided into three classes, each of which will be nearly equal in number as possible. The CEC board of directors currently consists of seven (7) directors, divided into three classes with staggered three-year terms. Whenever the holders of any one or more classes or series of preferred stock issued by CEC has the right, voting separately by class or series, to elect directors at an annual meeting or special meeting of stockholders, the election, term of office, filling of vacancies and other features of such directorships are governed by the terms of the certificate of incorporation and any resolutions of the board of directors applicable thereto, and such directors so elected are not be divided into the three classes described above.
         

69


REMOVAL OF DIRECTORS:
 
Whitman's directors may be removed, with or without cause, at a meeting of shareholders, provided the notice of the meeting states that one of the purposes of the meeting is the removal of the director. A director may be removed only if the number of votes cast to remove the director exceeds the number of votes cast against removal.
 
CEC's directors may only be removed for cause, except as otherwise provided by law, by the holders of at least 662/3% of the shares entitled to vote for the election of directors.

VACANCIES:
 
Any vacancy occurring on Whitman's board, including any vacancy created by reason of an increase in the number of directors, may be filled by the shareholders in the manner provided by Florida law or by the affirmative vote of a majority of remaining directors, though less than a quorum, and any director so chosen holds office until the next election of directors by the shareholders. If there are no remaining directors, the vacancy is filled by the shareholders.
 
If any vacancies occur on CEC's board, or if any new directorships are created, they are filled by a majority of the board of directors. Any director elected to fill a vacancy not resulting from an increase in the number of directors has the same remaining term as that of his or her predecessor.

ANNUAL MEETING:
 
The annual meeting of Whitman's shareholders is held at the date and time designated by the board of directors.
 
The annual meeting of CEC's stockholders is held on the third Thursday in May if not a legal holiday, and, if a legal holiday, then on the next secular day following, at 10:00 a.m., or at such other date and time as will be designated from time to time by the board of directors and stated in the notice of the meeting.
         

70


CALLING A SPECIAL MEETING OF HOLDERS:
 
Special meetings of Whitman's shareholders may be called upon the written request of the chairman, the chief executive officer, the board of directors (either by action at a meeting, or by a majority of directors acting without a meeting) or shareholders holding at least 50% of Whitman's stock entitled to vote at the meeting. At least 50% of all votes entitled to be cast on any issue proposed to be considered at the proposed special meeting must sign, date and deliver to the secretary of Whitman one or more written demands for the meeting describing the purpose or purposes for which it is to be held.
 
Special meetings of CEC's stockholders may be called only by the board of directors pursuant to a resolution approved by a majority of the board of directors. The business transacted at any special meeting of the stockholders is limited to the purposes stated in the notice for the meeting transmitted to stockholders.

ACTION BY WRITTEN CONSENT OF THE HOLDERS:
 
Whitman's shareholders may take action without a meeting by written consent if consents setting forth the action taken are signed by at least a majority of shares entitled to vote and are delivered to the secretary of Whitman, or other officer or agent having custody of Whitman's books within sixty (60) days after the date that the earliest written consent was delivered. If the action creates dissenters' rights, a notice to the shareholders shall contain a clear statement of the right of dissenting shareholders to be paid fair value of their shares upon compliance with, and as provided for by, the FBCA.
 
Any action required or permitted to be taken by CEC's stockholders will be effected only at a duly called annual or special meeting of CEC stockholders and may not be effected by consent in writing by the holders of outstanding stock pursuant to Section 228 of DGCL or any other provision of DGCL.

AMENDMENT OF CHARTER:
 
Amendments to Whitman's articles of incorporation are governed by the FBCA, which generally requires approval by a majority of directors and by holders of a majority of the shares entitled to vote on the amendment.
 
Under the DGCL, CEC's board must adopt a resolution declaring the advisability of an amendment to the certificate of incorporation and the amendment must be approved by the holders of a majority of the outstanding stock entitled to vote upon the proposed amendment, unless a higher vote is required by the certificate of incorporation (see super-majority voting requirements below).
         

71


AMENDMENT OF BYLAWS:
 
Whitman's bylaws provide that the bylaws may be altered, amended or repealed, and new bylaws adopted by the board of directors or shareholders.
 
CEC's bylaws may be altered, amended or repealed, or new bylaws may be adopted by the board of directors or by the vote of the holders of at least 80% of the voting power of the shares entitled to vote generally in the election of directors at an annual or special meeting of stockholders.

LIMITATION OF PERSONAL LIABILITY OF DIRECTORS AND OFFICERS:
 
Under FBCA Section 607.0831, a director is not personally liable for monetary damages to the corporation or any other person for any statement, vote, decision, or failure to act, regarding corporate management or policy, unless the director breached or failed to perform his duties as director and such breach or failure to perform constitutes: (1) a violation of criminal law, unless the director had reasonable cause to believe his or her conduct was lawful or had no reasonable cause to believe his or her conduct was unlawful; (2) a transaction in which he or she derived improper personal benefit; (3) an unlawful distribution; (4) in a derivative suit, conscious disregard for the best interests of the corporation, or willful misconduct; or (5) in a proceeding other than a derivative suit, recklessness or an act or omission which was committed in bad faith or with malicious purpose or in a manner exhibiting wanton and willful disregard of human rights, safety, or property.
 
In accordance with Section 102(b)(7) of the DGCL, CEC's certificate of incorporation provides that no director shall be personally liable for monetary damages for breach of fiduciary duty as a director, except for (1) any breach of the director's duty of loyalty to CEC or its stockholders; (2) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; (3) payment of a dividend or the repurchase or redemption of stock in violation of Delaware law; or (4) any transaction from which the director derived an improper benefit.
         

72


INDEMNIFICATION OF DIRECTORS AND OFFICERS:
 
Under FBCA Section 607.0850, a corporation has the power to indemnify directors and officers (1) for actions taken in good faith and in a manner they reasonably believed to be in, or not opposed to, the best interest of the corporation; and (2) with respect to any criminal proceeding where they had no reasonable cause to believe that their conduct was unlawful.
  
  
 In addition, FBCA Section 607.0850 provides that a corporation may advance to a director or officer reasonable expenses incurred in defending any action upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if he or she is ultimately found not to be entitled to indemnification.
   
  
 Whitman's bylaws provide for indemnification of its directors, officers to the full extent permitted by the FBCA.
 
Under Section 145 of the DGCL, a corporation may indemnify directors and officers (1) for actions taken in good faith and in a manner they reasonably believed to be in, or not opposed to, the best interest of the corporation; and (2) with respect to any criminal proceeding where they had no reasonable cause to believe that their conduct was unlawful.
  
  
 In addition, Section 145 of the DGCL provides that a corporation may advance to a director or officer expenses incurred in defending any action upon receipt of an undertaking by the director or officer to repay the amount advanced if it is ultimately determined that he or she is not entitled to indemnification.
   
  
 CEC's certificate of incorporation and bylaws provide for indemnification of its directors and officers to the full extent permitted by the DGCL.

SUPER-MAJORITY VOTING REQUIREMENTS:
 
Whitman's articles of incorporation and bylaws do not provide for super-majority voting requirements.
 
In addition to the 80% vote required to amend CEC's bylaws and the 662/3% required to remove a director, CEC's certificate of incorporation requires the affirmative vote of at least 80% of the voting power of all shares entitled to vote generally in the election of directors to amend, alter or repeal, or adopt any provision inconsistent with the certificate of incorporation's Article addressing the composition, election and terms of the board of directors.
         

73


BUSINESS COMBINATIONS:
 
Under Section 607.0901 of the FBCA, certain transactions, including, without limitation, a merger, consolidation, certain sales of assets, certain sales of shares, a liquidation or a dissolution, involving a corporation and 10% shareholder (an interested shareholder) generally must be approved by two-thirds of the outstanding shares other than those shares owned by the interested shareholder. These requirements do not apply if: (1) the business combination has been approved by a majority of the disinterested directors; (2) the corporation has not had more than 300 shareholders of record at any time during the three years preceding the announcement of the business combination; (3) the 10% shareholder has been the beneficial owner of at least 80% of the outstanding shares for at least five years before the announcement date; (4) the interested shareholder is the owner of at least 90% of the voting shares, excluding any acquired through a transaction not approved by a majority of the disinterested directors; or (5) the consideration paid to the holders of acquired shares is at least equal to certain fair price criteria. Although Whitman may opt out of these provisions under certain circumstances, it has not done so.
 
Under Section 203 of the DGCL, which deals with business combinations, a corporation is prohibited from engaging in any business combination with an interested stockholder who, together with affiliates or associates, owns, or who become an affiliate or associate of the corporation and within a three year period did own, 15% or more of the corporation's voting stock for a three year period following the time the stockholder became an interested stockholder, except under limited circumstances. Although CEC may elect not to be governed by this provision of Delaware law in its certificate of incorporation, it has not opted to do so.
         

74


SHAREHOLDER OR STOCKHOLDER RIGHTS AGREEMENT
 
Whitman does not have a shareholders' rights agreement.
 
On May 28, 2002, CEC adopted a Rights Agreement, commonly called a "poison pill," which would substantially reduce or eliminate the expected economic benefit to an acquiror from acquiring CEC in a manner or on terms not approved by the board of directors. The Rights Agreement, which granted each CEC stockholder a Series A Preferred Stock purchase right, is designed to deter coercive takeover tactics and to prevent an acquiror from gaining control of CEC without offering fair value to its stockholders.

75


WHERE YOU CAN FIND MORE INFORMATION

        Whitman and CEC each file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any reports, statements or other information that Whitman or CEC files at the SEC's public reference rooms at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, as well as at the SEC's regional offices at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and 233 Broadway, New York, New York 10005. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room in Washington, D.C. Whitman and CEC filings with the SEC are also available to the public from commercial document retrieval services and at the web site maintained by the SEC at "http:www.sec.gov."

        CEC has filed with the SEC a registration statement on Form S-4 to register the CEC common stock to be issued to holders of Whitman common stock under the merger agreement. This proxy statement/prospectus constitutes the prospectus of CEC and the proxy statement of Whitman and is filed as part of the registration statement. Other parts of the registration statement are omitted from this proxy statement/prospectus in accordance with the rules and regulations of the SEC. Copies of the registration statement, including exhibits, may be obtained from the SEC as described above.

        The SEC permits Whitman and CEC to "incorporate by reference" information into this proxy statement/prospectus, which means that Whitman and CEC can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is considered part of this proxy statement/prospectus. Information in this proxy statement/prospectus updates and, in some cases, supersedes information incorporated by reference from documents that CEC or Whitman has filed with the SEC prior to the date of this proxy statement/prospectus, while information that CEC or Whitman files later with the SEC will automatically update and, in some cases, supersede the information in this proxy statement/prospectus.

        The following documents previously filed with the SEC by CEC (Commission File Number 0-23245) are incorporated by reference into this proxy statement/prospectus:

        The following documents previously filed with the SEC by Whitman (Commission File Number 1-13722) are incorporated by reference into this proxy statement/prospectus:

        In addition, all documents filed by the CEC and Whitman under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this proxy statement/prospectus and before the date of the special meeting are incorporated by reference into, and deemed a part of, this proxy statement/prospectus from the date of filing of those documents.

76


EXPERTS

        The consolidated financial statements of Career Education Corporation and Subsidiaries as of December 31, 2002 and for the year then ended appearing in Career Education Corporation's 2002 Annual Report (on Form 10-K/A) have been audited by Ernst & Young LLP, independent auditors, as set forth in their report thereon included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

        The consolidated financial statements of Career Education Corporation and Subsidiaries as of December 31, 2001 and for the two years in the period then ended appearing in Career Education Corporation's 2002 Annual Report (on Form 10-K/A) have been audited by Arthur Andersen LLP, independent certified public accountants, as set forth in their report thereon included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon the authority of such firm as experts in accounting and auditing in giving such report.

        The consolidated financial statements of Whitman Education Group, Inc. and Subsidiaries as of March 31, 2002 and 2003 and for each of the three years in the period ended March 31, 2003, appearing in Whitman Education Group, Inc.'s 2003 Annual Report on Form 10-K have been audited by Ernst & Young LLP, independent certified public accountants, as set forth in their report thereon included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing.


LEGAL MATTERS

        The validity of the CEC common stock issuable in connection with the merger will be passed upon for CEC by Katten Muchin Zavis Rosenman. Katten Muchin Zavis Rosenman and Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A. will pass upon federal income tax consequences of the merger for CEC and Whitman, respectively.


FUTURE SHAREHOLDER PROPOSALS

        Due to the contemplated consummation of the merger, Whitman does not currently expect to hold a 2003 annual meeting of shareholders because, following the merger, Whitman will not be a publicly traded company. If the merger is not consummated, no proposals of Whitman shareholders will be included in Whitman's proxy materials or considered at Whitman's 2003 annual meeting unless Whitman's meeting of shareholders is held on or after September 15, 2003, in which case proposals of shareholders intended to be included in Whitman's proxy statement must be received a reasonable time in advance of the meeting. Shareholders wishing to present proposals to be considered at that annual meeting must notify Whitman no later than the close of business on the tenth day after Whitman announces publicly the date of its 2003 annual meeting.

77



ANNEX A

EXECUTION COPY

AGREEMENT AND PLAN OF MERGER

Among

CAREER EDUCATION CORPORATION,

MARLIN ACQUISITION CORP.

and

WHITMAN EDUCATION GROUP, INC.




Dated

March 26, 2003


TABLE OF CONTENTS

 
    
   Page
ARTICLE 1 DEFINITIONS   A-1

ARTICLE 2 THE MERGER
 
A-8
    2.1 The Merger   A-8
    2.2 Effective Time; Filing of Certificate of Merger   A-8
    2.3 Articles of Incorporation   A-8
    2.4 Bylaws   A-8
    2.5 Directors and Officers   A-8
    2.6 Tax Consequences   A-8
    2.7 Additional Actions   A-8
    2.8 Time and Place of Closing   A-9

ARTICLE 3 CONVERSION OF SECURITIES; EXCHANGE OF SECURITIES
 
A-9
    3.1 Merger Consideration   A-9
    3.2 Exchange of Certificates   A-10
    3.3 Stock Transfer Books   A-12
    3.4 Existing Options of the Company   A-12

ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE COMPANY
 
A-13
    4.1 Organization; Business   A-14
    4.2 Capitalization   A-14
    4.3 Authorization; Enforceability   A-15
    4.4 No Violation or Conflict   A-15
    4.5 SEC Reports   A-16
    4.6 Company Financial Statements; Liabilities   A-16
    4.7 Absence of Certain Changes   A-17
    4.8 Title to Assets   A-17
    4.9 Real Estate   A-18
    4.10 Intangible Assets   A-18
    4.11 Contract Matters   A-18
    4.12 Insurance   A-20
    4.13 Litigation   A-20
    4.14 Taxes   A-20
    4.15 Employee Benefits   A-22
    4.16 Environmental Protection   A-23
    4.17 Labor and Employment Matters   A-23
    4.18 Unlawful Payments and Contributions   A-24
    4.19 Existing Permits, Pending Reviews and Violations of Law   A-24
    4.20 Regulatory Matters   A-24
    4.21 Financial Assistance Programs   A-28
    4.22 Transactions with Affiliates   A-29
    4.23 Vote Required   A-29
    4.24 Board Approval   A-29
    4.25 Restrictions on Business Activities   A-29
    4.26 Change of Control Payments   A-29
    4.27 Governmental Approvals   A-29
    4.28 Educational Agency Approval   A-30
    4.29 Registration Statement; Proxy Statement/Prospectus   A-30
    4.30 Tax Treatment   A-30
         

A-i

    4.31 Opinion of Financial Advisor   A-30
    4.32 Brokers' and Finders' Fees   A-30
    4.33 No Pending Acquisitions   A-30
    4.34 Takeover Laws   A-30
    4.35 Affiliate Agreements   A-31
    4.36 Voting Agreement   A-31
    4.37 Disclosure   A-31

ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
 
A-31
    5.1 Organization; Business   A-31
    5.2 Capitalization   A-31
    5.3 Authorization; Enforceability   A-32
    5.4 No Violation or Conflict   A-32
    5.5 SEC Reports   A-32
    5.6 Parent Financial Statements   A-33
    5.7 Governmental Approvals   A-33
    5.8 Registration Statement; Proxy Statement/Prospectus   A-33
    5.9 Tax Treatment   A-33
    5.10 Operations of Merger Sub   A-33
    5.11 Absence of Certain Changes   A-34
    5.12 Litigation   A-34
    5.13 Existing Permits and Violations of Law   A-34
    5.14 Revenue Thresholds   A-35
    5.15 Control Matters   A-35
    5.16 Educational Agency Approval   A-35
    5.17 Brokers' and Finders' Fees   A-36
    5.18 Disclosure   A-36

ARTICLE 6 COVENANTS AND AGREEMENTS
 
A-36
    6.1 Conduct of Business by the Company   A-36
    6.2 Conduct of Business by Parent   A-38
    6.3 Access   A-38
    6.4 Meeting of Stockholders   A-39
    6.5 Registration Statement; Proxy Statement/Prospectus   A-39
    6.6 Blue Sky Laws   A-40
    6.7 Listing   A-40
    6.8 SEC Actions   A-40
    6.9 Accountants' "Comfort" Letters   A-40
    6.10 Additional Reports   A-41
    6.11 Confidentiality Agreements   A-41
    6.12 Regulatory and Other Approvals   A-41
    6.13 No Solicitation   A-42
    6.14 Public Announcements   A-44
    6.15 Expenses   A-44
    6.16 Certain Benefit Plans   A-45
    6.17 Indemnification   A-45
    6.18 Takeover Law   A-46
    6.19 Notification of Certain Matters   A-46
    6.20 Disclosure Letter Supplements   A-47
    6.21 Tax-Free Reorganization Treatment   A-47
    6.22 Exemption from Liability under Section 16(b)   A-47
         

A-ii

    6.23 Real Estate Deliveries   A-47
    6.24 Reasonable Efforts   A-48
    6.25 Affiliate Agreements   A-48
    6.26 No Rights Triggered   A-48
    6.27 Shareholder Litigation   A-48
    6.28 Operational Matters   A-48

ARTICLE 7 CONDITIONS TO THE MERGER
 
A-48
    7.1 Conditions to Each Party's Obligation to Effect the Merger   A-48
    7.2 Conditions to the Company's Obligation to Effect the Merger   A-49
    7.3 Conditions to Parent's and Merger Sub's Obligation to Effect the Merger   A-50

ARTICLE 8 TERMINATION, WAIVER AND AMENDMENT
 
A-52
    8.1 Termination   A-52
    8.2 Effect of Termination   A-54
    8.3 Termination Fee   A-54

ARTICLE 9 MISCELLANEOUS
 
A-55
    9.1 No Survival of Representations and Warranties   A-55
    9.2 Entire Agreement   A-55
    9.3 Amendment   A-55
    9.4 Extension; Waiver   A-55
    9.5 Governing Law   A-55
    9.6 Assignment; Binding Effect   A-56
    9.7 Notices   A-56
    9.8 Counterparts; Headings   A-56
    9.9 Interpretation   A-56
    9.10 Specific Performance   A-57
    9.11 No Reliance   A-57
    9.12 Exhibits and Disclosure Letters   A-57
    9.13 No Third Party Beneficiary   A-57
    9.14 Severability   A-57
    9.15 Other Remedies   A-57
    9.16 Rules of Construction   A-57

A-iii

EXHIBITS

    Exhibit 1-A   Company Officers    
    Exhibit 1-B   Parent Officers    
    Exhibit 4.35   Form of Company Affiliate Agreement    
    Exhibit 4.36   Form of Voting Agreement    

A-iv


AGREEMENT AND PLAN OF MERGER

        This AGREEMENT AND PLAN OF MERGER, dated March 26, 2003 (the "Agreement"), is by and among Career Education Corporation, a Delaware corporation ("Parent"), Marlin Acquisition Corp., a Florida corporation and a wholly-owned subsidiary of Parent ("Merger Sub"), and Whitman Education Group, Inc., a Florida corporation (the "Company").

INTRODUCTION

        The Boards of Directors of Parent, Merger Sub and the Company have approved and deem it advisable and in the best interests of their respective stockholders to consummate the merger of the Company with and into Merger Sub upon the terms and subject to the conditions set forth herein.

        Parent, Merger Sub and the Company desire to make certain representations, warranties, covenants and agreements in connection with the Merger and also prescribe various conditions to the Merger.

        In consideration of the mutual covenants, representations, warranties and agreements contained herein, and intending to be legally bound hereby, Parent, Merger Sub and the Company agree as follows:

ARTICLE 1

DEFINITIONS

        When used in this Agreement, and in addition to the other terms defined herein, the following terms shall have the meanings specified:

A-1

A-2

A-3

A-4

A-5

A-6

A-7

ARTICLE 2

THE MERGER

        2.1    The Merger.    Upon the terms and subject to the conditions set forth in this Agreement and in accordance with FBCA, at the Effective Time, the Company shall be merged with and into Merger Sub (the "Merger"), the separate corporate existence of the Company shall cease and Merger Sub shall (a) be the surviving corporation in the Merger (in such capacity, the "Surviving Corporation"); (b) succeed to and assume all the rights and obligations of the Company in accordance with FBCA; and (c) continue its corporate existence under the laws of the State of Florida. The Merger shall be pursuant to the provisions of, and shall be with the effect provided in FBCA. In accordance with FBCA, all of the rights, privileges, property, powers and franchises of the Company and Merger Sub shall vest in the Surviving Corporation, and all of the debts, liabilities and duties of the Company and Merger Sub shall become the debts, liabilities and duties of the Surviving Corporation.

        2.2    Effective Time; Filing of Certificate of Merger.    Subject to the terms of this Agreement, on the Closing Date (as hereinafter defined) the Parties shall cause the Merger to be consummated by filing properly executed Articles of Merger or other appropriate documents with the Secretary of State of the State of Florida in accordance with the provisions of FBCA. The Merger shall become effective at 5:00 p.m., Eastern Time, on the date of filing of the Articles of Merger with the Secretary of State of the State of Florida or at such later date or time as Merger Sub and the Company shall agree and specify in the Articles of Merger (the "Effective Time").

        2.3    Articles of Incorporation.    At the Effective Time, the Articles of Incorporation of the Surviving Corporation shall be the Articles of Incorporation of Merger Sub as in effect immediately prior to the Effective Time, until thereafter amended in accordance with its terms and FBCA.

        2.4    Bylaws.    At the Effective Time, the Bylaws of the Surviving Corporation shall be the Bylaws of Merger Sub as in effect immediately prior to the Effective Time, until thereafter amended in accordance with their terms and FBCA.

        2.5    Directors and Officers.    At the Effective Time, the directors and the officers of Merger Sub immediately prior to the Effective Time shall be the initial directors and officers of the Surviving Corporation. Each director and officer of the Surviving Corporation shall hold office in accordance with the Articles of Incorporation and Bylaws of the Surviving Corporation until his or her death, resignation or removal or a successor is duly elected or appointed and qualified.

        2.6    Tax Consequences.    It is intended that the Merger shall qualify as a "reorganization" under Section 368(a) of the Code, and that this Agreement shall constitute a "plan of reorganization" for purposes of Section 354 of the Code.

        2.7    Additional Actions.    If, at any time after the Effective Time, the Surviving Corporation shall consider or be advised that consistent with the terms of this Agreement any further assignments or assurances in law or any other acts are necessary or desirable (a) to vest, perfect or confirm, of record or otherwise, in the Surviving Corporation, title to and possession of any property or right of either Constituent Corporation acquired or to be acquired by reason of, or as a result of, the Merger, or (b) otherwise to carry out the purposes of this Agreement, then, subject to the terms and conditions of this Agreement, each such Constituent Corporation and its officers and directors shall be deemed to have granted to the Surviving Corporation an irrevocable power of attorney to execute and deliver all such deeds, assignments and assurances in law and to do all acts necessary or proper to vest, perfect or confirm title to and possession of such property or rights in the Surviving Corporation and otherwise to carry out the purposes of this Agreement; and the officers and directors of the Surviving Corporation are fully authorized in the name of either Constituent Corporation to take any and all such action.

A-8


        2.8    Time and Place of Closing.    The closing of the Merger (the "Closing") shall take place (a) at the offices of Katten Muchin Zavis Rosenman, 525 West Monroe Street, Suite 1600, Chicago, Illinois on a date and at a time to be specified by the parties, which shall be no later than the second business day following satisfaction or waiver of all of the conditions set forth in Article 7, or (b) at such other place, at such other time or on such other date as the parties may mutually agree (the date of the Closing is hereinafter sometimes referred to as the "Closing Date"). The Closing shall be deemed to be effective concurrently with the Effective Time. All proceedings to be taken and all documents to be executed at the Closing shall be deemed to have been taken, delivered, executed and filed simultaneously and simultaneously with the Effective Time, and no proceeding shall be deemed taken nor documents deemed executed or delivered until all have been taken, delivered, executed and filed.

ARTICLE 3

CONVERSION OF SECURITIES; EXCHANGE OF SECURITIES

        3.1    Merger Consideration.    At the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, the Company or the holders of any of the following securities:

A-9

        3.2    Exchange of Certificates.    

A-10

A-11

        3.3    Stock Transfer Books.    After the Effective Time, there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the shares of Company Common Stock which were outstanding immediately prior to the Effective Time. If, after the Effective Time, Company Stock Certificates are presented to the Surviving Corporation or the Exchange/Paying Agent for any reason, they shall be canceled and exchanged as provided in this Article 3, except as otherwise required by Law.

        3.4    Existing Options of the Company.    

A-12

ARTICLE 4

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

        The Company hereby represents and warrants to Parent and Merger Sub, subject only to the exceptions specifically disclosed in writing in the disclosure letter dated as of the date hereof, certified by a duly authorized officer, in his capacity as such, of the Company and delivered to Parent by the Company pursuant to, and as an integral part of, this Agreement (the "Company Disclosure Letter"),

A-13


which specifically identifies the Section and subsection numbers hereof to which the disclosures pertain, as follows:

        4.1    Organization; Business.    

        4.2    Capitalization.    

A-14

        4.3    Authorization; Enforceability.    The execution, delivery and performance by the Company of this Agreement are, subject to the terms hereof, within the corporate power and authority of the Company and, subject to the provisions hereof, have been duly authorized by the Board of Directors of the Company. Except for (a) the approval of Stockholders as required by Law and the Company's Articles of Incorporation, as described in Section 4.23 hereof and (b) the filing of Articles of Merger and other appropriate documents as required by Law and as described in Section 2.2 hereof, no other corporate proceeding or action on the part of the Company is necessary to authorize the execution and delivery by the Company of this Agreement and the consummation by it of the Merger and the other transactions contemplated hereby. Assuming that such documents have been or will be duly and validly executed and delivered by or on behalf of the respective other party thereto, which party has the power to enter into and perform its obligations, this Agreement is, and the other documents and instruments required by this Agreement to be executed and delivered by the Company will be, when executed and delivered by the Company, the valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except as the enforcement thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar Laws generally affecting the rights of creditors and subject to general equity principles.

        4.4    No Violation or Conflict.    Subject to the receipt of the clearance or expiration or termination of the waiting period described in Section 7.1(a) and the approvals described in Section 7.1(b), the execution and delivery of this Agreement by the Company and all documents and instruments required by this Agreement to be executed and delivered by the Company do not, and the consummation by the Company of the Merger and the other transactions contemplated hereby and the Company's compliance with the provisions hereof will not, (a) result in any violation of any provision of the Articles of Incorporation or Bylaws of the Company or the charter or bylaws of any of the Company's Subsidiaries, (b) except as set forth in Section 4.4 of the Company Disclosure Letter, result in any violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or the loss of a material benefit under, any contract of the Company or its Subsidiaries, or result in the creation of any Lien upon any of the properties or assets of the Company or its Subsidiaries other than Permitted Liens, (c) except as set forth in Section 4.4 of the Company Disclosure Letter, violate any Existing Permits of the Company or its Subsidiaries or the Schools or any Law applicable to the Company or its Subsidiaries or the Schools or their properties or assets, or (d) violate any standard or requirement of any Educational Agency of any of the Schools of the Company or its Subsidiaries, with the exception of the requirements of the Educational Agencies listed in Section 4.4 of the Company Disclosure Letter to seek approval or

A-15


interim approval prior to the Closing, and other than, in the case of clauses (b), (c) and (d), any such violations, defaults, rights, losses or Liens that, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect on the Company or could not reasonably be expected to affect adversely the ability of the Company to consummate the Merger and the other transactions contemplated by this Agreement.

        4.5    SEC Reports.    The Company has filed with the SEC all forms, reports, schedules, statements and other documents required to be filed by it since January 1, 2000, under the Exchange Act or the Securities Act (as such documents have been amended since the time of their filing, collectively, the "Company SEC Documents"). As of their respective dates or, if amended prior to the date hereof, as of the date of the last such amendment, the Company SEC Documents, including, without limitation, any financial statements or schedules included therein, (a) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading and (b) complied in all material respects with the applicable requirements of the Exchange Act and the Securities Act, as the case may be, at such time of filing. Except as set forth on Section 4.5 of the Company Disclosure Letter, as of the date hereof, there are no amendments or modifications to agreements, documents or other instruments which previously had been filed by the Company with the SEC pursuant to the Securities Act or the Exchange Act or any other agreements, documents or other instruments, which have not yet been filed with the SEC but which are or will be required to be filed by the Company. To the Knowledge of the Company, (x) there exist no outstanding SEC comments with respect to any of the Company SEC Documents and (y) there are no SEC inquiries or investigations, other inquiries or investigations by any Governmental Entity or internal investigations pending or threatened, in each case regarding any accounting practices of the Company or any of its Subsidiaries.

        4.6    Company Financial Statements; Liabilities.    

A-16

        4.7    Absence of Certain Changes.    Since December 31, 2002, the Company has conducted its business in a manner consistent with past practice and there has not been any:

        4.8    Title to Assets.    Each of the Company and its Subsidiaries has valid title to its tangible assets necessary for the conduct of its business, free and clear of any and all Liens, except (a) as reflected on the Company balance sheet as of December 31, 2002, included in the Company Financial Statements,

A-17

(b) Liens for Taxes not yet due and payable, (c) statutory Liens securing payments not yet due and (d) Liens and encumbrances set forth in Section 4.8 of the Company Disclosure Letter (collectively, "Permitted Liens").

        4.9    Real Estate.    

        4.10    Intangible Assets.    (a) The Company and each of its Subsidiaries owns all right, title and interest in, or possesses valid licenses or other rights to use, all material Intangible Assets necessary to conduct its business as now conducted, free and clear of any Liens (other than Permitted Liens) and without obligation to pay any royalties or other fees with respect thereto; (b) there are no claims, demands or proceedings instituted, pending, or, to the Knowledge of the Company, threatened in writing by any Person contesting or challenging the right of the Company or its Subsidiaries to use any of their material Intangible Assets; (c) each trademark registration, service mark registration, Internet domain name registration, copyright registration and patent (collectively, "Registered Intangible Assets") which is owned by the Company or one or more of its Subsidiaries has been maintained in good standing; and any such material Registered Intangible Assets licensed to the Company or its Subsidiaries have, to the Company's Knowledge, been maintained in good standing; (d) to the Knowledge of the Company, no Person is infringing or otherwise violating the Intangible Assets of the Company or any of its Subsidiaries; (e) neither the Company nor any of its Subsidiaries is using any material Intangible Assets of any other Person without such Person's license, permission or consent; (f) neither the Company nor any of its Subsidiaries has infringed or otherwise violated, or is infringing or otherwise violating, any material Intangible Assets of any other Persons; (g) neither the Company nor any of its Subsidiaries is in material violation or in material default of any license or other agreement granting rights in respect of any Intangible Assets, including any licenses for use of software; and (h) the consummation of the Merger and the other transactions contemplated by this Agreement in accordance with the terms hereof will not impair materially the validity, enforceability, ownership or right of the Company or its Subsidiaries to use its Intangible Assets.

        4.11    Contract Matters.    

A-18

A-19

        4.12    Insurance.    Except as set forth in Section 4.12 of the Company Disclosure Letter, all Existing Insurance Policies of the Company and its Subsidiaries are currently in full force and effect, and neither the Company nor any of its Subsidiaries has received written notice of cancellation or termination of, or material premium increase with respect to, any such Existing Insurance Policy in effect on the date hereof or within the past three years.

        4.13    Litigation.    Except as set forth on Section 4.13 of the Company Disclosure Letter, (a) there are no actions, suits, claims, litigation, or proceedings pending or, to the Knowledge of the Company, threatened in writing against the Company or its Subsidiaries that could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company; (b) there are no such actions, suits or proceedings pending or, to the Knowledge of the Company, threatened in writing, against the Company or its Subsidiaries which question the legality or validity of the Merger and the other transactions contemplated by this Agreement; and (c) to the Knowledge of the Company, there are no outstanding orders, judgments, injunctions, awards or decrees of any Governmental Entity or Accrediting Body against the Company, its Subsidiaries or Schools that could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company. The Company has made available to Parent or its counsel true and complete copies of all correspondence prepared by its counsel for the Company's auditors in connection with the last three (3) completed audits of the audited Company Financial Statements and any such correspondence since the date of the last such audit.

        4.14    Taxes.    Except as set forth in Section 4.14 of the Company Disclosure Letter:

A-20

A-21

        4.15    Employee Benefits.    

A-22

        4.16    Environmental Protection.    The Company and each of its Subsidiaries: (a) is in compliance in all material respects with applicable Environmental Laws; and (b) has not received any communication (written or oral), from a Governmental Entity or third party that alleges that the Company or any of its Subsidiaries is not in compliance in any material respect with applicable Environmental Laws.

        4.17    Labor and Employment Matters.    

A-23

        4.18    Unlawful Payments and Contributions.    Neither the Company, any Subsidiary of the Company nor any of their respective directors, officers, employees or agents has, with respect to the businesses of the Company or its Subsidiaries, (a) used any funds for any unlawful contribution, endorsement, gift, entertainment or other unlawful expense relating to political activity; (b) made any direct or indirect unlawful payment to any foreign or domestic government official or employee; (c) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended; or (d) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any person or entity.

        4.19    Existing Permits, Pending Reviews and Violations of Law.    To the Knowledge of the Company, the Company, each of its Subsidiaries and each of the Schools has and has had since July 1, 1997, all licenses, permits, accreditations, certificates, approvals, exemptions, orders, franchises, qualifications, permissions, agreements and governmental authorizations required by Law or by any Educational Agency and required for the conduct of the business of the Company, its Subsidiaries and the Schools as currently conducted, except where such failure to hold such license, permit, accreditation, certificate, approval, exemption, order, franchise, qualification, permission, agreement or governmental authorization has not had and could not reasonably be expected to have a Material Adverse Impact (the "Material Existing Permits"). No action or proceeding is pending or, to the Knowledge of the Company, threatened that is reasonably likely to result in a revocation, non-renewal, termination, suspension or other material impairment of any Material Existing Permit of the Company, its Subsidiaries or the Schools, and, to the Company's Knowledge, there is no basis for non-renewal of any Material Existing Permit. (For purposes of Section 7.3(a) of this Agreement, however, "Material Existing Permit" in the immediately preceding sentence shall be defined by substituting "Material Adverse Effect on the Company" for "Material Adverse Impact" in the definition of "Material Existing Permit.") To the Knowledge of the Company, the business of the Company, its Subsidiaries and the Schools is not being and has not, since July 1, 1997, been conducted in violation of any applicable Law or Educational Agency standard, except as set forth on Section 4.19 of the Company Disclosure Letter, or except in the case that such violation could not reasonably be expected to have a Material Adverse Impact. Except as set forth in Section 4.19 of the Company Disclosure Letter, to the Knowledge of the Company, no Governmental Entity or Educational Agency has indicated to the Company, any Subsidiary of the Company or any School an intention to conduct an investigation or review with respect to the Company, any Subsidiary of the Company or any School, except in the case that (a) such review has been closed or (b) such review is a routine review pursuant to recertification before the DOE, reaffirmation of accreditation or state license renewal, which review could not reasonably be expected to have a Material Adverse Impact. To the Knowledge of the Company, since July 1, 1997, the Company, each of its Subsidiaries and each School has filed all reports, documents, information, applications and returns required to have been filed by it in order to remain in substantial compliance with the Material Existing Permits, except for such violations that could not reasonably be expected to have a Material Adverse Impact or result in the revocation, non-renewal, termination, suspension or other material impairment of any Material Existing Permit of the Company, its Subsidiaries or its Schools.

        4.20    Regulatory Matters.    

A-24

A-25

A-26

A-27

        4.21    Financial Assistance Programs.    

A-28

        4.22    Transactions with Affiliates.    Except as set forth in the Company SEC Documents as disclosed under the caption "Certain Relationships and Related Transactions" in its Proxy Statement on Schedule 14A, dated July 15, 2002 or in Section 4.22 of the Company Disclosure Letter, neither the Company nor any of its Subsidiaries is a party to any transactions with any director, executive officer or other Affiliates or any member of such person's "Family" (as defined below) of a type that would be required to be disclosed in the Company SEC Documents pursuant to Item 404 of Regulation S-K of the SEC, and neither the Company nor any of its Subsidiaries has any existing binding commitments to engage in any such transactions with any of such persons in the future. For purposes of this definition, the "Family" of an individual includes (a) such individual, (b) the individual's spouse, siblings, or ancestors, (c) any lineal descendant of such individual, or their siblings, or ancestors, or (d) a trust for the benefit of the foregoing.

        4.23    Vote Required.    The affirmative vote of the holders of at least a majority of the outstanding shares of Company Common Stock entitled to vote with respect to the Merger is the only vote of the holders of any class or series of the Company's capital stock necessary to approve the Merger and this Agreement.

        4.24    Board Approval.    The Board of Directors of the Company has, on or prior to the date hereof, unanimously approved this Agreement, the Merger and the other transactions contemplated hereby and has determined to recommend to Stockholders that they approve the Merger.

        4.25    Restrictions on Business Activities.    To the Knowledge of the Company, except as set forth in Section 4.25 of the Company Disclosure Letter, there is no judgment, injunction, order or decree binding upon the Company or its Subsidiaries or their properties (including, without limitation, their Intangible Assets) which has or could reasonably be expected to have the effect or prohibiting of materially impairing the conduct of any business by the Company or any of its Subsidiaries.

        4.26    Change of Control Payments.    Except as set forth in any Company Option Plan or in Section 4.26 of the Company Disclosure Letter, and except as contemplated by this Agreement, neither the execution and delivery of this Agreement nor the consummation of the Merger and other transactions contemplated hereby will: (a) result in any payment (including, without limitation, severance, unemployment compensation, golden parachute, bonus or otherwise) becoming due to any director, officer or employee of the Company or its Subsidiaries from the Company or its Subsidiaries or Parent or the Surviving Corporation, under any Company Benefit Plan or otherwise, (b) materially increase any benefits otherwise payable under any Company Benefit Plan, (c) result in the acceleration of the time of payment or vesting of any such benefits, (d) create a right to receive payments upon a subsequent termination of employment, (e) result in the acceleration of the time of payment of any of the Company's accounts payable or (f) result in a "change in control" under, require the consent from or the giving of notice to a third party pursuant to, or accelerate the rights under, any contract to which the Company or its Subsidiaries is a party.

        4.27    Governmental Approvals.    No permission, approval, determination, consent or waiver by, or any declaration, filing or registration with, any Governmental Entity or Educational Agency is required by the Company in connection with the execution and delivery of this Agreement by the Company, the consummation by the Company of the Merger or the other transactions contemplated by this Agreement or the Surviving Corporation's ability to continue to conduct the business of the Company consistent with the Company's historical ordinary course of business except for: (a) the approvals or filings in connection with (1) the HSR Act as described in Section 7.1(a), (2) the Securities Act, including, without limitation, filing of the Proxy Statement/Prospectus with the SEC, (3) the Exchange Act, (4) the securities and blue sky Laws of various states, (5) the rules and regulations of the Stock Market and AMEX, (6) the rules and regulations of the DOE and (7) the rules and regulations of the Educational Agencies listed in Section 4.27 of the Company Disclosure Letter; (b) the filing of the Articles of Merger as described in this Agreement; and (c) such permissions, approvals, determinations,

A-29


consents, waivers, declarations, filings, or registrations that, if not obtained could not, individually or in the aggregate, have a Material Adverse Effect on the Company or materially impair the Company's ability to consummate the Merger and the other transactions contemplated hereby.

        4.28    Educational Agency Approval.    To the Company's Knowledge, there exists no fact or circumstance attributable to the Company, any Subsidiary or any School which could reasonably be expected to have a negative impact on Parent's ability to obtain any authorization, consent or similar approval from the DOE or any other Governmental Entity or Accrediting Body whose authorization, consent or similar approval is contemplated in connection with this Agreement, including, without limitation, any authorization, consent or similar approval which must be obtained preceding or following the Closing from the DOE or any Educational Agency in order to continue the operations of the Schools as presently conducted.

        4.29    Registration Statement; Proxy Statement/Prospectus.    The information supplied by the Company for inclusion in the Parent's registration statement on Form S-4, which shall include the Proxy Statement/Prospectus, pursuant to which the issuance of the shares of Parent Common Stock to be issued to Stockholders in the Merger will be registered under the Securities Act (the "Registration Statement"), shall not at the time the Registration Statement is filed with the SEC and at the time it becomes effective under the Securities Act, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements included therein not misleading.

        4.30    Tax Treatment.    The Company has no Knowledge of any reason why the Merger will, and has not taken or agreed to take any action that could cause the Merger to, fail to qualify as a "reorganization" under Section 368(a) of the Code.

        4.31    Opinion of Financial Advisor.    The Company has received the written opinion of the Financial Advisor, to the effect that, as of March 26, 2003, the Merger Consideration to be received by the Stockholders, based upon and subject to the assumptions and limitations set forth in such opinion, is fair to the Stockholders from a financial point of view. The Company shall promptly after the date hereof deliver a copy of such opinion to Parent.

        4.32    Brokers' and Finders' Fees.    Except for fees to be paid to the Financial Advisor, the Company has not incurred any brokers', finders' or any similar fee in connection with the transactions contemplated by this Agreement. The Company has previously delivered a true and complete copy of the agreement with the Financial Advisor to the Parent.

        4.33    No Pending Acquisitions.    Except for this Agreement and the Confidentiality Agreements dated June 26, 2002 and March 17, 2003 between Parent and the Company (together, the "Confidentiality Agreements"), neither the Company nor its Subsidiaries is a party to or bound by any agreement, undertaking or commitment with respect to the acquisition of the capital stock or assets of another Person.

        4.34    Takeover Laws.    The Company has taken all action required to be taken by it in order to exempt this Agreement, the Merger and the Voting Agreement (as defined below) and the other transactions contemplated hereby and under the Voting Agreement from, and this Agreement, the Merger and the Voting Agreement and the transactions contemplated hereby and under the Voting Agreement are exempt from, the requirements of any and all "moratorium," "control share," "fair price," "affiliate transaction," "control transaction," "business combination" or other anti-takeover Laws and regulations of the State of Florida (including, without limitation, Sections 607.0901 and 607.0902 of the FBCA) or of any other State (collectively, "Takeover Laws").

A-30


        4.35    Affiliate Agreements.    Section 4.35 of the Company Disclosure Letter sets forth each Stockholder that is or is reasonably likely to be, as of the date hereof, deemed to be an Affiliate of the Company, and the Company has delivered to Parent executed agreements, dated as of the date hereof, in the form attached hereto as Exhibit 4.35 (an "Affiliate Letter") for each such Person.

        4.36    Voting Agreement.    The Company has delivered to Parent, a voting agreement, in the form attached as Exhibit 4.36 hereto from each of Philip Frost, M.D., Frost-Nevada Investments Trust, Richard Pfenniger, Jr. and Fernando Fernandez (the "Voting Agreement"). The Board of Directors of the Company has, on or prior to the date hereof, unanimously approved the Voting Agreement and the transactions contemplated thereby.

        4.37    Disclosure.    No representation or warranty by the Company in this Agreement and no statement contained in the Company Disclosure Letter or any certificate or document delivered by the Company to Parent pursuant to this Agreement, contains any untrue statement of a material fact or omits any material fact necessary to make the statements herein or therein not misleading when taken together in light of the circumstances in which they were made.

ARTICLE 5

REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

        Parent and Merger Sub represent and warrant to the Company, subject only to the exceptions specifically disclosed in writing in the disclosure letter dated as of the date hereof, certified by a duly authorized officer of Parent, in his capacity as such, and delivered to the Company by Parent pursuant to, and as an integral part of, this Agreement (the "Parent Disclosure Letter"), which specifically identifies the Section and subsection numbers hereof to which the disclosures pertain, as follows:

        5.1    Organization; Business.    

        5.2    Capitalization.    

A-31

        5.3    Authorization; Enforceability.    The execution, delivery and performance by Parent and Merger Sub of this Agreement are within the corporate power and authority of each of Parent and Merger Sub and, subject to the provisions hereof, have been duly authorized by the Board of Directors of each of Parent and Merger Sub. Except for the filing of the Articles of Merger, no other corporate proceeding or action on the part of Parent and Merger Sub (including, without limitation, the approval of any class of security holder of Parent) is necessary to authorize the execution and delivery by Parent and Merger Sub of this Agreement and the consummation by Parent and Merger Sub of the Merger and the other transactions contemplated hereby. Assuming that such documents have been or will be duly and validly executed and delivered by or on behalf of the respective other party thereto, which party has the power to enter into and perform its obligations thereunder, this Agreement is, and the other documents and instruments required by this Agreement to be executed and delivered by Parent and Merger Sub will be, when executed and delivered by Parent and Merger Sub, the valid and binding obligations of Parent and Merger Sub, enforceable against Parent and Merger Sub in accordance with their respective terms, except as the enforcement thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar Laws generally affecting the rights of creditors and subject to general equity principles.

        5.4    No Violation or Conflict.    Subject to the receipt of the clearance or expiration or termination of the waiting period described in Section 7.1(a) and the approvals described in Section 7.1(b), the execution and delivery of this Agreement by Parent and Merger Sub and all documents and instruments required by this Agreement to be executed and delivered by Parent or Merger Sub do not, and the consummation by Parent and Merger Sub of the Merger and the other transactions contemplated hereby and Parent's and Merger Sub's compliance with the provisions hereof will not, (a) result in any violation of any provision of the Certificate of Incorporation or Bylaws of Parent or any of its Subsidiaries, (b) result in any violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or the loss of a material benefit under, any contract of the Parent or its Subsidiaries, or result in the creation of any Lien upon any of the properties or assets of parent or its Subsidiaries other than Permitted Liens, (c) violate any Existing Permits of Parent or its Subsidiaries or the Schools or any Law applicable to Parent or its Subsidiaries or the Schools or their properties or assets, or (d) violate any standard or requirement of any Educational Agency of any of the Schools of Parent or its Subsidiaries, other than, in the case of clauses (b), (c) and (d), any such violations, defaults, rights, losses or Liens that, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect on Parent or could not reasonably be expected to affect adversely the ability of Parent to consummate the Merger and the other transactions contemplated by this Agreement.

        5.5    SEC Reports.    Parent has filed with the SEC all forms, reports, schedules, statements and other documents required to be filed by it since January 1, 2000 under the Exchange Act or the Securities Act (as such documents have been amended since the time of their filing, collectively, the "Parent SEC Documents"). As of their respective dates or, if amended prior to the date hereof, as of the date of the last such amendment, the Parent SEC Documents, including, without limitation, any financial statements or schedules included therein (a) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading and (b) complied in all material respects with the applicable requirements of the Exchange Act and the Securities Act, as the case may be, at such time of filing. As of the date hereof, there are no amendments or modifications to agreements, documents or other instruments which previously had been filed by Parent with the SEC pursuant to the Securities Act or the Exchange Act or any other agreements, documents or other instruments, which have not yet been filed with the SEC but which are or will be required to be filed by Parent. Except as set forth in Section 5.5 of the Parent Disclosure Letter, to the Knowledge of Parent (x) there exist no outstanding SEC comments with respect to any of the Parent SEC Documents and (y) there are no SEC inquiries or investigations, other inquiries or

A-32


investigations by any Governmental Entity or internal investigations pending or threatened, in each case regarding any accounting practices of Parent or any of its Subsidiaries.

        5.6    Parent Financial Statements.    

        5.7    Governmental Approvals.    No permission, approval, determination, consent or waiver by, or any declaration, filing or registration with, any Governmental Entity or Educational Agency is required by Parent or Merger Sub in connection with the execution and delivery of this Agreement by Parent and Merger Sub or the consummation by Parent and Merger Sub of the Merger or the other transactions contemplated by this Agreement, except for: (a) the approvals or filings in connection with the (1) HSR Act as described in Section 7.1(a), (2) the Securities Act (including, without limitation, filing of the Proxy Statement/Prospectus with the SEC), (3) the Exchange Act (including, without limitation, filing a Current Report on Form 8-K with the SEC), (4) the securities and blue sky Laws of various states, (5) the rules and regulations of the Stock Market, (6) the rules and regulations of the DOE and (7) the rules and regulations of the Educational Agencies listed in Section 5.7 of the Parent Disclosure Letter; (b) the filing of the Articles of Merger as described in this Agreement; and (c) such permissions, approvals, determinations, consents, waivers, declarations, filings, or registrations that, if not obtained could not, individually or in the aggregate, have a Material Adverse Effect on Parent, or materially impair Parent's or Merger Sub's ability to consummate the Merger and the other transactions contemplated hereby.

        5.8    Registration Statement; Proxy Statement/Prospectus.    The information supplied by Parent for inclusion in the Registration Statement, shall not at the time the Registration Statement is filed with the SEC and at the time it becomes effective under the Securities Act, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements included therein not misleading.

        5.9    Tax Treatment.    Parent has no Knowledge of any reason why the Merger will, and has not taken or agreed to take any action that could cause the Merger to, fail to qualify as a "reorganization" under Section 368(a) of the Code.

        5.10    Operations of Merger Sub.    Merger Sub is a direct, wholly-owned subsidiary of Parent, was formed solely for the purpose of engaging in the Merger and the other transactions contemplated

A-33


hereby, has engaged in no other business activities and has conducted its operations only as contemplated hereby.

        5.11    Absence of Certain Changes.    Since December 31, 2002, Parent has conducted its business in a manner consistent with past practice and there has not been any:

        5.12    Litigation.    Except as set forth in Section 5.12 of the Parent Disclosure Letter:, (a) there are no actions, suits, claims, litigation, or proceedings pending or, to the Knowledge of Parent, threatened in writing against Parent or its Subsidiaries that could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on Parent; (b) there are no actions, suits or proceedings pending or, to the Knowledge of the Parent, threatened in writing, against the Parent or its Subsidiaries which question the legality or validity of the Merger and the other transactions contemplated by this Agreement; and (c) to the Knowledge of Parent, there are no outstanding orders, judgments, injunctions, awards or decrees of any Governmental Entity or Accrediting Body against Parent, its Subsidiaries or their Schools that could be expected to have, individually or in the aggregate, a Material Adverse Effect on the Parent.

        5.13    Existing Permits and Violations of Law.    Parent, each of its Subsidiaries and each of its Schools has and has had since July 1, 1997, all licenses, permits, accreditations, certificates, approvals, exemptions, orders, franchises, qualifications, permissions, agreements and governmental authorizations required by Law or by any Educational Agency and material to the business of Parent on a consolidated basis together with its Subsidiaries and its Schools. No action or proceeding is pending or, to the Knowledge of Parent, threatened that is reasonably likely to result in a revocation, non-renewal, termination, suspension or other material impairment of any Existing Permits which are material to the business of Parent on a consolidated basis together with its Subsidiaries and its Schools, and, to Parent's Knowledge, there is no basis which could be reasonably expected to cause non-renewal of any such material Existing Permit. The business of Parent, its Subsidiaries and its Schools is not being and has not, since July 1, 1997, been conducted in violation of any applicable Law or Educational Agency requirement or Accrediting Body standard, except as set forth on Section 5.13 of the Parent Disclosure Letter, or except in the case that such violation could not be reasonably expected to have a Material Adverse Effect on Parent. No Educational Agency or Governmental Entity currently is conducting an investigation of Parent, any of its Subsidiaries or any of its Schools, and no Educational Agency or

A-34


Governmental Entity has indicated in writing to Parent, any of its Subsidiaries or any of its Schools an intention to conduct an investigation or review with respect to Parent, any of its Subsidiaries or any School, except in the case that (a) such review has been closed, (b) such review is described in Section 5.13 of the Parent Disclosure Letter, or (c) such review is a routine review, pursuant to recertification before DOE, reaffirmation of accreditation or state license renewal, which review could not reasonably be expected to have a Material Adverse Effect on Parent.

        5.14    Revenue Thresholds.    For the fiscal year ended December 31, 2002, each Parent Institution had no more than ninety percent (90%) of its revenues derived from the Title IV Programs or pursuant to the Title IV Programs as determined in accordance with 34 C.F.R. § 600.5(d).

        5.15    Control Matters.    To the Knowledge of Parent, since July 1, 1997, no person who exercises substantial control over Parent or any Institution (as the term "substantial control" is defined at 34 C.F.R. §600.30) exercised substantial control over another postsecondary educational institution other than Parent or any Institution (whether or not participating in the Title IV Programs) or any third party servicer (as that term is defined at 34 C.F.R. §668.2) prior to or at the time they were employed by Parent or any Institution. To the Knowledge of Parent, no person who has for any period since July 1, 1997, exercised substantial control over Parent or any Institution (as the term "substantial control" is defined at 34 C.F.R. §600.30) or any member or members of that person's family, alone or together, exercised, prior to or concurrent with their position of substantial control with Parent or any Institution, substantial control over an institution other than Parent or any Institution or a third-party servicer (prior to or during the period such person exercised substantial control over Parent or any Institution) that owes a liability for a violation of any requirement of the Title IV Programs. To the Knowledge of Parent, since July 1, 1997, no Institution nor any person who exercises substantial control over Parent or any Institution (as the term "substantial control" is defined at 34 C.F.R. §600.30) has pled guilty to, has pled nolo contendere to, or has been found guilty of, a crime involving the acquisition, use or expenditure of funds under the Title IV Programs or has been judicially determined to have committed fraud involving funds under the Title IV Programs. To the Knowledge of Parent, since July 1, 1997, neither Parent nor any Institution nor any Affiliate of Parent or any Institution that has the power, by contract or ownership interest, to direct or cause the direction of the management of policies of any Institution, has filed for relief in bankruptcy or has entered against it an order for relief in bankruptcy. Neither Parent nor any Institution knowingly employs, and, since July 1, 1997 has knowingly employed, any individual or entity in a capacity that involves the administration or receipt of funds under the Title IV Programs, or knowingly contracted with any institution or third-party servicer, which has been terminated under the Higher Education Act of 1965, as amended, for a reason involving the acquisition, use or expenditure of federal, state or local government funds, or has been convicted of, or has pled nolo contendere or guilty to, a crime involving the acquisition, use or expenditure of federal, state or local government funds, or has been administratively or judicially determined to have committed fraud or any other material violation of law involving federal, state or local government funds. No Institution not then a School or Affiliate of Parent (whether or not participating in the Title IV Programs) or any third-party servicer (as that term is defined at 34 C.F.R. 668.2) is, or since July 1, 1997 has been, administered commonly, jointly or in conjunction with Parent or any School, and no other institution or organization not then a School or Affiliate of Parent has provided educational services on behalf of Parent or any of its Schools, except instruction provided under clinical affiliations. Neither Parent nor any School provides, or since July 1, 1997, has provided, any Title IV eligible educational instruction on behalf of any other institution or organization of any sort.

        5.16    Educational Agency Approval.    To Parent's Knowledge, there exists no fact or circumstance attributable to Parent or Merger Sub or their Affiliates which could reasonably be expected to have a negative impact on Parent's ability to obtain any authorization, consent or similar approval from the DOE or any other Governmental Entity or Accrediting Body whose authorization, consent or similar

A-35


approval is contemplated in connection with this Agreement, including, without limitation, any authorization, consent or similar approval which must be obtained preceding or following the Closing from the DOE or any Educational Agency in order to continue the operations of the Schools as presently conducted.

        5.17    Brokers' and Finders' Fees.    Neither Parent nor Merger Sub has incurred any brokers', finders' or any similar fee in connection with the transactions contemplated by this Agreement.

        5.18    Disclosure.    No representation or warranty by Parent in this Agreement and no statement contained in the Parent Disclosure Letter or any certificate or document delivered by Parent to the Company pursuant to this Agreement, contains any untrue statement of a material fact or omits any material fact necessary to make the statements herein or therein not misleading when taken together in light of the circumstances in which they were made.

ARTICLE 6

COVENANTS AND AGREEMENTS

        6.1    Conduct of Business by the Company.    During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms and the Effective Time, the Company agrees, except as set forth in Section 6.1 of the Company Disclosure Letter or to the extent that Parent shall otherwise consent in writing, and to cause each of its Subsidiaries to, carry on its business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay timely its debts and Taxes, subject to good faith disputes over such debts or Taxes, and on the same payment terms such debts and taxes have historically been paid, to collect its receivables in the same manner and on the same terms such receivables have historically been collected, to timely pay or perform other material obligations when due, and to use all commercially reasonable efforts consistent with past practices and policies to preserve intact the Company's present business organizations, keep available the services of its present officers and employees and preserve its relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with the Company and its Subsidiaries, to the end that the Company's goodwill and ongoing businesses be unimpaired at the Effective Time. The Company shall promptly notify Parent of any material event or occurrence not in the ordinary course of business of the Company. Except as required by Law or GAAP or the rules and regulations of AMEX or as expressly provided for by this Agreement or as set forth in Section 6.1 of the Company Disclosure Letter, the Company shall not, and shall cause its Subsidiaries not to, prior to the Effective Time or earlier termination of this Agreement pursuant to its terms, without the prior written consent of Parent:

A-36

A-37

        6.2    Conduct of Business by Parent.    Except as expressly provided for by this Agreement, from and after the date of this Agreement and until the earlier of the termination of this Agreement or the Effective Time, Parent shall: (a) carry on its business in the usual, regular and ordinary course substantially in the same manner as heretofore carried on, (b) not knowingly do any act or omit to do any act that could result in a breach of any representation, warranty or covenant of Parent set forth in this Agreement, (c) not take any action that could reasonably be expected to cause any of the conditions to the Merger not to be satisfied and (d) not enter into any agreement, arrangement or understanding with respect to any of the foregoing.

        6.3    Access.    Subject to the provisions of the Confidentiality Agreements, from and after the date of this Agreement and until the earlier of the termination of this Agreement or the Effective Time, upon reasonable request, the Company shall afford to Parent and Parent's agents, accountants, officers, employees, attorneys and other authorized advisers and representatives reasonable access, during normal business hours, to its properties, facilities, books, records, financial statements and other documents and materials relating to its financial condition, assets, liabilities and business. In addition and subject to the terms and conditions of the Confidentiality Agreements, during such time period, the Company shall confer and consult with representatives of Parent to report on operational matters, financial matters and the general status of ongoing business operations of the Company. From time to time after the date of this Agreement and until the earlier of the termination of this Agreement or the

A-38


Effective Time the Company shall furnish promptly to Parent a copy of each report, schedule and other document filed by the Company, or received by the Company after the date of this Agreement pursuant to the requirements of federal or state securities Laws promptly after such documents are available.

        6.4    Meeting of Stockholders.    The Company shall, consistent with its Articles of Incorporation and Bylaws, call and hold a special meeting of its stockholders, as promptly as practicable after the effectiveness of the Registration Statement for the purpose of voting upon the adoption or approval of this Agreement (the "Special Meeting"), and shall use all commercially reasonable efforts to hold its Special Meeting as soon as practicable after the date on which the Registration Statement becomes effective. The Company shall, subject to the applicable fiduciary duties of its directors, as determined by such directors in good faith with the written advice of its independent counsel (who may be its regularly engaged independent legal counsel), (a) use all commercially reasonable efforts to solicit from the Stockholders proxies in favor of the adoption or approval, as the case may be, of the Merger, (b) take all other action necessary or advisable to secure the vote or consent of stockholders, as required by the FBCA to obtain such adoption or approvals, and (c) include in the Proxy Statement/Prospectus the recommendation of its Board of Directors in favor of the Merger and not withdraw or adversely modify such recommendation, provided that any failure of the Company to take any action required by this Section 6.4 because of the applicable fiduciary duties of its directors shall not effect the requirement to hold the Special Meeting.

        6.5    Registration Statement; Proxy Statement/Prospectus.    

A-39

        6.6    Blue Sky Laws.    Parent shall take such steps as may be necessary to comply with the securities and blue sky Laws of all jurisdictions which are applicable to the issuance of Parent Common Stock pursuant hereto.

        6.7    Listing.    Promptly after the date of this Agreement, Parent shall prepare and file an application to list on the Stock Market the shares of Parent Common Stock issuable, in connection with the Merger, and to obtain approval for the listing of such shares of Parent Common Stock on the Stock Market prior to the Effective Time, subject only to official notice of issuance.

        6.8    SEC Actions.    Parent will advise the Company, promptly after Parent receives notice thereof, of the receipt of any comments by the SEC on the Registration Statement, the time when the Registration Statement has become effective or any supplement or amendment has been filed, of the issuance of any stop order or the suspension of the qualification of Parent Common Stock for offering or sale in any jurisdiction, of the initiation or threat of any proceeding for any such purpose, or of any request by the SEC for the amendment or supplement of the Registration Statement or for additional information.

        6.9    Accountants' "Comfort" Letters.    The Company and Parent will each use their commercially reasonable efforts to cause to be delivered to each other reasonable and customary letters from their respective independent accountants, the first letter dated a date within two (2) business days before the effective date of the Registration Statement and the second letter dated a date within two (2)business days before the Closing Date, in form and substance reasonably satisfactory to the recipient and customary in scope and substance for comfort letters delivered by independent accountants in connection with registration statements similar to the Registration Statement.

A-40


        6.10    Additional Reports.    In accordance with Section 6.3, the Company and Parent shall each furnish to the other copies of any Company SEC Documents or Parent SEC Documents, as the case may be, which it files with the SEC on or after the date hereof, and the Company and Parent, as the case may be, represents and warrants that as of the respective dates thereof, such reports will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statement therein, in light of the circumstances under which they were made, not misleading. Any unaudited consolidated interim financial statements included in such reports (including any related notes and schedules) will fairly present, in all material respects, the financial position of the Company or Parent, as the case may be, as of the dates thereof and the results of operations and changes in financial position or other information included therein for the periods or as of the dates then ended, in each case in accordance with such Party's past practice and GAAP consistently applied during the periods involved (except as otherwise disclosed in the notes thereto and subject, where appropriate, to normal year-end adjustments).

        6.11    Confidentiality Agreements.    The Company and Parent agree that the Confidentiality Agreements remains in full force and effect, unimpaired and unmodified by this Agreement, but shall at the Effective Time be deemed to have terminated without further action by the parties.

        6.12    Regulatory and Other Approvals.    

A-41

        6.13    No Solicitation.    

A-42

A-43

        6.14    Public Announcements.    Any public announcement made by or on behalf of either Parent or the Company prior to the termination of this Agreement pursuant to Article 8 hereof concerning this Agreement, the transactions described herein or any other aspect of the dealings heretofore had or hereafter to be had between the Company and Parent and their respective Affiliates must first be approved by the other party (any such approval not to be unreasonably withheld), subject to either party's obligations under applicable Law or Stock Market or AMEX listing requirements or rules (but such party shall use its reasonable best efforts to consult with the other party as to all such public announcements).

        6.15    Expenses.    

A-44

        6.16    Certain Benefit Plans.    

        6.17    Indemnification.    

A-45

        6.18    Takeover Law.    Neither the Company, Parent nor Merger Sub shall take any action that would cause the Merger or the other transactions contemplated by this Agreement and the Voting Agreement to be subject to the requirements of any Takeover Law. If any Takeover Law shall become applicable to the Merger or the other transactions contemplated by this Agreement and the Voting Agreement, each of the Company and Parent and their respective Boards of Directors shall grant such approvals and take such actions as are necessary so that the Merger and the other transactions contemplated by this Agreement and the Voting Agreement may be consummated as promptly as practicable on the terms contemplated by this Agreement and the Voting Agreement, and otherwise act to eliminate or minimize the effects of such Takeover Law on the Merger and the other transactions contemplated by this Agreement and the Voting Agreement.

        6.19    Notification of Certain Matters.    Between the date of this Agreement and the Effective Time, each of the Company and Parent will promptly notify the other in writing if such Party becomes aware of any development, fact or condition that (a) is reasonably likely, individually or with other existing

A-46


developments, facts or conditions, to result in a Material Adverse Effect with respect to such Party, or (b) causes or constitutes a breach of any agreement or covenant under this Agreement applicable to such Party, or of such Party's representations and warranties as of the date of this Agreement, or if such Party becomes aware of the occurrence after the date of this Agreement of any fact or condition that would cause or constitute a breach of any such representation or warranty had such representation or warranty been made as of the time of occurrence or discovery of such fact or condition. No such notice will constitute a cure of any such breach.

        6.20    Disclosure Letter Supplements.    From time to time prior to the Effective Time, each Party hereto will promptly supplement, update or modify (by written notice to the other) its respective Disclosure Letters delivered pursuant hereto with respect to any matter hereafter arising which, if existing, occurring or known at the date of this Agreement, would have been required to be set forth or described in such Disclosure Letter or which is necessary to correct any information in such Disclosure Letter which has been rendered inaccurate thereby. For the purpose of determining satisfaction of the conditions set forth in Article 7 and subject to Sections 7.2(a) and 7.3(a), no effect will be given to any supplement, update or modification of the respective Disclosure Letters made or purported to be made pursuant to this Section 6.20. No such supplement, update or modification to the respective Disclosure Letter will constitute a cure of any breach of any agreement, representation or covenant under this Agreement.

        6.21    Tax-Free Reorganization Treatment.    The Parties shall use their best efforts to cause the Merger to be treated as a "reorganization" within the meaning of Section 368(a) of the Code and shall not knowingly take or fail to take any action which action or failure to act would jeopardize the qualification of the Merger as a "reorganization" within the meaning of Section 368 of the Code. Without limiting the foregoing, each of the Parties shall execute and deliver to counsel to each of the Parties such representation letters as may be reasonably requested by such law firms in connection with their delivery of opinions with respect to the transactions contemplated hereby.

        6.22    Exemption from Liability under Section 16(b).    

        6.23    Real Estate Deliveries.    The Company shall use its good faith efforts in cooperating with Parent in obtaining the following, in forms reasonably requested by Parent, with respect to each of the Leases; provided, however, the Company shall not be required to unreasonably burden its business operations in so cooperating: (a) an estoppel, consent and amendment agreement from each of the landlords, joined by the tenant thereof, and (b) a subordination, nondisturbance and attornment agreement from each mortgagee or trustee under a deed of trust or underlying or ground lessor.

A-47

        6.24    Reasonable Efforts.    So long as this Agreement has not been terminated, the Company, the Parent and Merger Sub shall: (a) promptly make their respective filings (including, without limitation, filings required pursuant to the Securities Act and the Exchange Act), obtain waivers, consents, permits and approvals, and thereafter make any other submissions required under all applicable Laws in order to consummate the Merger and the other transactions contemplated hereby and (b) use their respective reasonable best efforts to promptly take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or appropriate to consummate the Merger and the other transactions contemplated by this Agreement.

        6.25    Affiliate Agreements.    

        6.26    No Rights Triggered.    Each of the Company and Parent shall use their respective reasonable best efforts to ensure that the entering into of this Agreement and the consummation of the transactions contemplated hereby and any other action or combination of actions, or any other transactions contemplated hereby, do not and will not result in the grant of any rights to any Person under the Parent Rights Plan or under any agreement to which it or any of its Subsidiaries is a party.

        6.27    Shareholder Litigation.    The Parties shall cooperate and consult with one another, to the fullest extent possible, in connection with any stockholder litigation against any of them or any of their respective directors or officers with respect to the transactions contemplated by this Agreement. In furtherance of and without in any way limiting the foregoing, each of the Parties shall use its respective commercially reasonable efforts to prevail in such litigation so as to permit the consummation of the transactions contemplated by this Agreement in the manner contemplated by this Agreement. Notwithstanding the foregoing, the Company shall not compromise or settle any litigation commenced against it or its directors or officers relating to this Agreement or the transactions contemplated hereby (including the Merger) without Parent's prior written consent, which shall not be unreasonably withheld or delayed.

        6.28    Operational Matters.    After the execution of this Agreement, the Company shall cooperate with the Parent in developing post-Closing transition policies with respect to management information systems, marketing, admissions, personnel, outsourcing, operations, regulatory matters and accounting, including, without limitation, meeting regularly (at such times as shall be mutually agreed upon by the Company and Parent) with on-site transition teams of Parent with respect to marketing, management information systems, regulatory matters and accounting. The Company shall maintain its marketing expenditures to the extent set forth in the Company's marketing budget attached hereto as Section 6.28 of the Company Disclosure Letter.

ARTICLE 7

CONDITIONS TO THE MERGER

        7.1    Conditions to Each Party's Obligation to Effect the Merger.    The respective obligations of each Party to consummate and effect the Merger and the other transactions contemplated hereby shall be subject to the satisfaction prior to or at the Closing as hereinafter provided of the following conditions,

A-48

each of which may only be waived in writing in whole or in part by mutual agreement of all of the Parties, to the extent permitted by Law:

        7.2    Conditions to the Company's Obligation to Effect the Merger.    The obligations of the Company to consummate and effect the Merger and the other transactions contemplated hereby are further subject to the fulfillment of the following conditions, any of which may be waived only in writing in whole or part by the Company:

A-49

        7.3    Conditions to Parent's and Merger Sub's Obligation to Effect the Merger.    The obligations of Parent and Merger Sub to consummate and effect the Merger and the other transactions contemplated hereby are further subject to the fulfillment of the following conditions, any of which may be waived only in writing in whole or part by Parent or Merger Sub:

A-50

A-51

ARTICLE 8

TERMINATION, WAIVER AND AMENDMENT

        8.1    Termination.    This Agreement may be terminated and the Merger and transactions contemplated by this Agreement may be abandoned at any time prior to the Effective Time (whether before or after the approval of this Agreement by the Stockholders), as follows:

A-52

A-53

        8.2    Effect of Termination.    In the event of termination of this Agreement pursuant to Section 8.1, this Agreement shall become void and of no further force and effect, and there shall be no liability or obligation on the part of Parent, Merger Sub, the Company or their respective officers or directors under this Agreement except as set forth in (a) the provisions of Section 6.3 relating to the obligations of the parties to keep confidential and not to use certain information obtained from the other party, and (b) the provisions of Sections 6.15 and 8.3 and Article 9.

        8.3    Termination Fee.    

A-54

ARTICLE 9

MISCELLANEOUS

        9.1    No Survival of Representations and Warranties.    The representations and warranties made in this Agreement shall not survive beyond the Effective Time. Notwithstanding the foregoing, the covenants and agreements set forth in Sections 3.1, 3.2, 3.4, 6.15, 6.16, 6.17 and Article 9 shall survive the Effective Time indefinitely (except to the extent a shorter period of time is explicitly specified therein).

        9.2    Entire Agreement.    This Agreement and the documents referred to in, or contemplated by, this Agreement, including the Company Disclosure Letter and the Parent Disclosure Letter, constitute the entire agreement among the Parties pertaining to the subject matter of this Agreement, and supersede all prior and contemporaneous agreements, understandings, negotiations and discussions of the Parties, whether oral or written, and there are no warranties, representations or other agreements between the Parties in connection with the subject matter of this Agreement, except as specifically set forth in this Agreement, it being understood that the Confidentiality Agreements shall continue in full force and effect until the Effective Time and shall survive termination of this Agreement.

        9.3    Amendment.    This Agreement may be amended by the Parties hereto at any time only by execution of an instrument in writing signed on behalf of each of the Parties hereto.

        9.4    Extension; Waiver.    At any time prior to the Effective Time, any Party hereto may, to the extent legally allowed, (a) extend the time for the performance of any of the obligations or other acts of the other Parties hereto, (b) waive any inaccuracies in the representations and warranties made to such Party contained herein or in any document delivered pursuant hereto and (c) waive compliance with any of the agreements or conditions for the benefit of such Party contained herein. Any agreement on the part of a Party hereto to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such Party.

        9.5    Governing Law.    Except to the extent required to be governed FBCA this Agreement shall be governed and construed in accordance with the Laws of the State of Delaware, regardless of the laws that might otherwise govern the applicable principles of conflicts of laws.

A-55


        9.6    Assignment; Binding Effect.    Neither this Agreement, nor any rights, obligations or interests hereunder, may be assigned by any Party hereto, except with the prior written consent of the other Parties hereto. Subject to the preceding sentence, this Agreement shall be binding upon, and shall inure to the benefit of, the Parties hereto and their respective successors and assigns. Merger Sub may however assign all its rights and obligations hereunder to another wholly owned subsidiary of Parent.

        9.7    Notices.    All communications or notices required or permitted by this Agreement shall be in writing and shall be deemed to have been given at the earlier of the date personally delivered or sent by telephonic facsimile transmission (with a copy via other means specified herein) or one day after sending via nationally recognized overnight courier or five (5) days after deposit in the United States mail, certified or registered mail, postage prepaid, return receipt requested, and addressed as follows, unless and until any of such parties notifies the others in accordance with this Section 9.7 of a change of address:

        If to the Company:

        With a copy to:

        If to Parent or Merger Sub:

        with a copy to:

        9.8    Counterparts; Headings.    This Agreement may be executed in several counterparts, each of which shall be deemed an original, but such counterparts shall together constitute but one and the same Agreement. The Article and Section headings in this Agreement are inserted for convenience of reference only and shall not constitute a part hereof.

        9.9    Interpretation.    Unless the context requires otherwise, all words used in this Agreement in the singular number shall extend to and include the plural, all words in the plural number shall extend to

A-56


and include the singular, and all words in any gender shall extend to and include all genders. The Article and Section headings in this Agreement are inserted for convenience of reference only and shall not constitute a part hereof.

        9.10    Specific Performance.    The Parties agree that the assets and business of the Company as a going concern constitute unique property and, accordingly, each Party shall be entitled, at its option and in addition to any other remedies available as herein provided, to the remedy of specific performance to effect the Merger as provided in this Agreement.

        9.11    No Reliance.    Except for the Parties to this Agreement and except as otherwise provided in Sections 6.17 and 6.22: (a) no Person is entitled to rely on any of the representations, warranties and agreements of the Parties contained in this Agreement; and (b) the Parties assume no liability to any Person because of any reliance on the representations, warranties and agreements of the Parties contained in this Agreement.

        9.12    Exhibits and Disclosure Letters.    The Exhibits, Company Disclosure Letter and Parent Disclosure Letter are a part of this Agreement as if fully set forth herein. All references herein to Sections, subsections, clauses, Exhibits, Company Disclosure Letter and Parent Disclosure Letter shall be deemed references to such parts of this Agreement, unless the context shall otherwise require.

        9.13    No Third Party Beneficiary.    Except as provided pursuant to Sections 6.16, 6.17, 6.22 and 8.2 hereof, the terms and provisions of this Agreement are intended solely for the benefit of the Parties hereto and their respective successors and assigns and it is not the intention of the Parties to confer third-party beneficiary rights upon any other Person.

        9.14    Severability.    In the event that any provision of this Agreement or the application thereof, becomes or is declared by a court of competent jurisdiction to be illegal, void or unenforceable, the remainder of this Agreement will continue in full force and effect and the application of such provision to other persons or circumstances will be interpreted so as reasonably to effect the intent of the Parties hereto. The Parties further agree to replace such voided or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of such voided or unenforceable provision.

        9.15    Other Remedies.    Except as otherwise provided herein, any and all remedies herein expressly conferred upon a Party will be deemed cumulative with and not exclusive of any other remedy conferred hereby, or by law or equity upon such Party, and the exercise by a Party of any one remedy will not preclude the exercise of any other remedy.

        9.16    Rules of Construction.    The Parties agree that they have been represented by counsel during the negotiation and execution of this Agreement and, therefore, waive the application of any law, regulation, holding or rule of construction providing that ambiguities in an agreement or other document will be construed against the Party drafting such agreement or document.

[remainder of page intentionally left blank;
signature page follows]

A-57

        IN WITNESS WHEREOF, the Parties have caused this Agreement and Plan of Merger to be duly executed as of the day and year first written above.

    CAREER EDUCATION CORPORATION

 
 
 
 
 
    By:   /s/ PATRICK K. PESCH
    Name:   Patrick Pesch
    Title:   Executive Vice President, Chief Financial Officer, Treasurer and Secretary

 
 
 
 
 
    MARLIN ACQUISITION CORP.

 
 
 
 
 
    By:   /s/ PATRICK K. PESCH
    Name:   Patrick Pesch
    Title:   Vice President, Chief Financial Officer, Treasurer and Secretary

 
 
 
 
 
    WHITMAN EDUCATION GROUP, INC.

 
 
 
 
 
    By:   /s/ RICHARD C. PFENNIGER, JR.
    Name:   Richard C. Pfenniger, Jr.
    Title:   Chief Executive Officer

A-58


ANNEX B

OPINION OF LEGG MASON WALKER WOOD, INCORPORATED

March 26, 2003

The Board of Directors
Whitman Education Group, Inc
c/o Phillip Frost, M.D., Chairman
4400 Biscayne Blvd., 6th Floor
Miami, FL 33137

Members of the Board of Directors:

        Career Education Corporation ("Career Education") has proposed the purchase of the common stock of Whitman Education Group, Inc., ("Whitman" or the "Company") for $14.25 per share, $6.00 per share in cash and $8.25 per share in Career Education common stock, in a merger transaction (the "Transaction") in which the Company will be merged with and into a wholly-owned subsidiary of Career Education. You have requested our opinion (the "Opinion"), as investment bankers, as to the fairness, from a financial point of view, of the consideration to be received in the Transaction by the Company's common stockholders.

        In connection with our Opinion set forth below, we have, among other things:

B-1

        In connection with our review, we have assumed and relied upon the accuracy and completeness of all financial and other information supplied to us by Whitman, and all publicly available information, and we have not independently verified such information. We have further relied on the assurances of the Company's management that they are unaware of any facts that would make the information provided to us incomplete or misleading. We also have relied upon the management of Whitman as to the reasonableness and achievability of the financial projections (and the assumptions and bases therein) provided to us by Whitman and we have assumed that such projections have been reasonably prepared on bases reflecting the best currently available estimates and judgments of management as to the future operating performance of Whitman. Whitman does not publicly disclose internal management projections of the type provided to Legg Mason in connection with Legg Mason's review of the Transaction. Such projections were not prepared with the expectation of public disclosure. The projections were based on numerous variables and assumptions that are inherently uncertain, including factors related to general economic and competitive conditions. Accordingly, actual results could vary significantly from those set forth in such projections. We have relied on these forecasts and do not in any respect assume any responsibility for the accuracy or completeness thereof.

        We have not been requested to make, and we have not made, an independent appraisal or evaluation of the assets, properties, facilities or liabilities of Whitman and we have not been furnished with any such appraisals or evaluations. Estimates of values of Whitman and its assets do not purport to be appraisals or necessarily reflect the prices at which Whitman or its assets may actually be sold. Because such estimates are inherently subject to uncertainty, Legg Mason assumes no responsibility for their accuracy.

        Our Opinion is necessarily based on share prices and economic and other conditions and circumstances as in effect on, and the information made available to us as of, March 24, 2003. Furthermore, we express no opinion as to the price or trading range at which shares of common stock of Career Education will trade in the future, and we have assumed that the current market price of such shares is an accurate measure of their value. We have also assumed that the final Agreement and Plan of Merger will not differ materially from the draft we reviewed. In addition, we have assumed that the Transaction will be consummated on the terms and conditions set forth in the Agreement and Plan of Merger, without any waiver of material terms or conditions by Whitman. Subsequent developments may affect our Opinion and we have no obligation to update, reissue or reaffirm our Opinion.

        This letter is directed to Whitman's Board of Directors (the "Board") and the Opinion expressed herein is provided for the use of the Board in its evaluation of the proposed Transaction. This letter does not constitute a recommendation of, or address the merits of, the Transaction over any other alternative transaction (including the alternative to not effect the Transaction) that may be available to Whitman and does not address the Board's underlying business decision to proceed with or to effect the Transaction. Also Legg Mason is not making any recommendation to Whitman's stockholders as to whether or not they should vote for or against the Transaction. In addition, we were not authorized to and did not solicit indications from any party for the acquisition of control of the Company or its businesses. This letter is not to be quoted or referred to, in whole or in part, in any registration statement, prospectus or proxy statement, nor shall this letter be used for any other purposes, without the prior written consent of Legg Mason Wood Walker, Incorporated, provided that this Opinion may be included in its entirety in any filing made by Whitman with the Securities and Exchange Commission with respect to the Transaction.

        Legg Mason has acted as the financial advisor to Whitman in connection with the analyses and evaluation of the proposed Transaction. Legg Mason has received a retainer as an initial payment. Legg

B-2


Mason will also receive a fee upon delivery of this fairness opinion and a fee if the closing of the Transaction occurs.

        In the past, Legg Mason has provided investment banking services to the buyer, Career Education and received customary fees for our services. We are familiar with Career Education and we may provide investment banking services to Career Education in the future.

        Based upon and subject to the foregoing, we are of the opinion that, as of March 26, 2003, the consideration to be received by Whitman's common stockholders in the Transaction is fair to such stockholders, from a financial point of view.

B-3

LOGO

WHITMAN EDUCATION GROUP, INC.
4400 Biscayne Boulevard
Miami, Florida 33137

PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON TUESDAY, JULY 1, 2003

THIS PROXY IS SOLICITED ON BEHALF OF THE WHITMAN BOARD OF DIRECTORS

        The undersigned hereby appoints Steven Stenmark and Neil Flanzraich, or either one of them, each with full power of substitution, to act as proxies for the undersigned, and to represent and to vote all of the shares of common stock of Whitman Education Group, Inc. (the "Company") that the undersigned would be entitled to vote if personally present at the Special Meeting of Shareholders of the Company to be held on Tuesday, July 1, 2003, at 10:00 a.m. local time at 4400 Biscayne Boulevard, 14th Floor, Miami, Florida 33137, and at any and all postponements and adjournments thereof, upon the matters as set forth in the Notice of Special Meeting of Shareholders and Proxy Statement/Prospectus.

        PLEASE MARK, SIGN, DATE AND MAIL THIS PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.

        IF NO DIRECTIONS ARE GIVEN AND THIS PROXY IS SIGNED AND RETURNED, THIS PROXY WILL BE VOTED FOR THE PROPOSAL TO APPROVE THE AGREEMENT AND PLAN OF MERGER.

(Continued and to be marked, dated and signed, on the other side)

Whitman Education Group, Inc.

The Company's Board of Directors unanimously recommends that you vote FOR the listed proposal.

1.
To approve the Agreement and Plan of Merger, dated as of March 26, 2003, among the Company, Career Education Corporation ("CEC") and Marlin Acquisition Corp., a wholly-owned subsidiary of CEC ("Marlin"), under which the Company will merge with and into Marlin, with Marlin continuing as a wholly-owned subsidiary of CEC.

o    FOR   o    AGAINST   o    ABSTAIN

The undersigned acknowledges receipt from the Company prior to execution of this proxy of a Notice of Special Meeting of Shareholders and a Proxy Statement/Prospectus dated May 30, 2003.

  Date:      
     

 

 
Signature

 
NOTE: Please sign exactly as name appears hereon. Joint owners should each sign. When signing on behalf of an entity or as attorney, executor, administrator, trustee or guardian, please give full title as such.


QuickLinks

QUESTIONS AND ANSWERS ABOUT THE MERGER
SUMMARY
SELECTED HISTORICAL FINANCIAL DATA OF CEC
SELECTED HISTORICAL FINANCIAL DATA OF WHITMAN
UNAUDITED SELECTED PRO FORMA CONDENSED COMBINED FINANCIAL DATA OF CEC AND WHITMAN
COMPARATIVE PER SHARE DATA
COMPARATIVE MARKET PRICE DATA
RISK FACTORS
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
THE WHITMAN SPECIAL MEETING
THE MERGER
THE MERGER AGREEMENT
THE VOTING AGREEMENT
INFORMATION ABOUT OUR COMPANIES
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS OF CEC AND WHITMAN
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
COMPARISON OF RIGHTS OF STOCKHOLDERS OF CEC AND SHAREHOLDERS OF WHITMAN
WHERE YOU CAN FIND MORE INFORMATION
EXPERTS
LEGAL MATTERS
FUTURE SHAREHOLDER PROPOSALS
AGREEMENT AND PLAN OF MERGER
OPINION OF LEGG MASON WALKER WOOD, INCORPORATED