From: Eileen Alexanderson

From: Eileen Alexanderson To: jeffrey E. <*eevacation a mail.com>, Richard Joslin a, Melanie Spinella Subject: KUE Date: Mon, 10 Nov 2014 22:12:16 +0000 Attachments: doc02675820141105130208.pdf Teleconference of KUE partner meeting finished a little while ago. The attached, which I sent last week, is a good summary of the situation. From today's meeting: -deal in hand for the sale of the Intl operation in Singapore for net proceeds of $108.2mil was announced at the meeting. Also KUE has a signed term sheet, with a exclusivity period only until Dec 8th, for the sale of the Canadian Intl School which would net $248mi1. Combined $357mi1 net proceeds after debt repayment is a bit below guidance I had been given of $400mi1 and a bit will be held back in an escrow account. Guidance was for a late Dec or Jan distribution of proceeds which would be roughly $5mil to us. -Propco — mindset toward monetizing but sounded like there is no firm shape for a deal yet i.e. whether they will sell to a REIT or form a new RE company and lever. Property portfolio is a bit of flux reflecting disposition of centers closed by Opco over the past several years. KUE would like LPs to have option of two ways out — cash or equity in survivor. As I indicated in the note, for extension to Oct 2016, Intl and Propco must be monetized by Oct 2015. -Opco — core early childhood care centers are growing again — EBITDA est for 2014 is $118mil, up from $89mi1 in 2013. Plan shows goal of $142mi1 in 2015 and $162m11 in 2016. Co suggested valuation at 10x EV/EBITDA seems appropriate given fact that public comp, Bright Horizons, trades at 15x EV/EBITDA but is supported by 14% ebitda margin compared to Opco at 9.3% currently and future forecast of 10%. Eileen Alexanderson Elysium Management EFTA01203246