Non-GAAP Measures

Projected EBITDA is an estimate of the company’s net income plus interest, taxes, depreciation and amortization for the twelve months ended December 31, 2013.  EBITDA is not a measurement under GAAP in the United States and may not be similar to EBITDA measures of other companies.  Non-GAAP financial information should be considered in addition to, but not as a substitute for, information prepared in accordance with GAAP.  The company believes that EBITDA provides useful information to management and investors as an indicator of the company’s operating performance.

Projected EBITDA is only an estimate and contains forward-looking information.  The company has made a number of assumptions in preparing the projection, including assumptions as to the components of the projected EBITDA.  These assumptions may or may not prove to be correct.  In order to provide projections with respect to EBITDA, the company must estimate amounts for the GAAP measures that are components of the reconciliation of projected EBITDA.  By providing these estimates, the company is in no way indicating that it is providing projections on those GAAP components of the reconciliation. The projected EBITDA and component amounts are subject to various risks and uncertainties, and do not guarantee actual results for the period indicated. Factors, risks and uncertainties that could cause actual results to differ materially from those projected include those discussed in the documents that we file with the Securities and Exchange Commission. We undertake no obligation to update or revise any of the projections, whether as a result of new information, future developments or otherwise.

Projected EBITDA can be reconciled to the company’s projected net income for the period indicated, as follows:

	2013 (5 KB)

Projected Cash Flows from Operations before 2007 RSA Settlement and 2009 RSA and PEAKS Program Payments (“CFOBRSA”) is an estimate of the company’s cash flows from operations before: (i) the company’s payment under the Settlement Agreement and Release entered into by the company and Sallie Mae, Inc. (“SMI”) on December 28, 2012, pursuant to which the company agreed to pay SMI a one-time payment of $46 million on or before January 29, 2013 to resolve pending litigation and the company’s guarantee obligations related to a Risk Sharing Loan Program Agreement between SMI and the company, dated July 17, 2007, for certain private education loans that were made to the company’s students in 2007 and early 2008 (the “2007 RSA Settlement”); (ii) any payments by the company related to its guarantee obligations associated with the a risk sharing agreement that it entered into with an unaffiliated entity to create a program that made private education loans available to the company’s students, pursuant to which the company guarantees the repayment of any private education loans that are charged off above a certain percentage of the private education loans made under that  loan program, based on the annual dollar volume (the “2009 RSA”); and (iii) any payments by the company related to its guarantee obligations (including, without limitation, the payment of the principal, interest and certain call premiums owed on senior debt issued in the aggregate principle amount of $300 million, and certain administrative fees and expenses) in connection with agreements entered into by the company with unrelated third parties to establish the PEAKS Private Student Loan Program that provided private education loans to the company’s eligible students that were originated by an unaffiliated lender (“PEAKS Program”).  CFOBRSA is not a measurement under Generally Accepted Accounting Principles (“GAAP”) in the United States and may not be similar to CFOBRSA measures of other companies.  Non-GAAP financial information should be considered in addition to, but not as a substitute for, information prepared in accordance with GAAP. The company believes that CFOBRSA provides useful information to management and investors as an indicator of the company’s operating cash flows before certain items

Projected CFOBRSA is only an estimate and contains forward-looking information. The company has made a number of assumptions in preparing the projection, including assumptions as to the components of the projected CFOBRSA. These assumptions may or may not prove to be correct. In order to provide projections with respect to CFOBRSA, the company must estimate amounts for the GAAP measures that are components of the reconciliation of projected CFOBRSA.  By providing these estimates, the company is in no way indicating that it is providing projections on those GAAP components of the reconciliation. The projected CFOBRSA and component amounts are subject to various risks and uncertainties, and do not guarantee actual results for the period indicated. Factors, risks and uncertainties that could cause actual results to differ materially from those projected include those discussed in the documents that we file with the Securities and Exchange Commission. We undertake no obligation to update or revise any of the projections, whether as a result of new information, future developments or otherwise.

Projected CFOBRSA can be reconciled to the company’s projected cash flows from operations for the period indicated, as follows:

	2013 (4 KB)