IESAM PRESENTATION

2

The Belém MarketLocation Status

Higher studentconcentration

Lower concentration

Greenfield address– Ver-o-Peso

Ananindeuapopulation: 470k

Belémpopulation: 1.4

million

The Pará state is the 19th largest post-secondary market in terms of enrollments and 10th in relation to new students The number of entrants increased 29% in Pará between 2010-11

Among the capitals in Brazil, Belém is the 16th in relation to the number ofnew entrants

Belém has 70% of Pará’s post-secondary students

IESAM competes with 16 other institutions. The competitorshave an average of 2,433 and a median of 2,046 enrolledstudents.

The number of new entrants grew by 14% between 2010 and2011 This is the 3rd highest growth in the location

IESAM has a 12% market share 9% share of new entrants

3

BelémPositioning

11,400

9,500

5,700

4,500

3,800 3,700

3,0002,600

2,200 2,100

Unama Esamaz Cesupa FACI Ipiranga Fibra Esmac Famaz Fapan

26% 19% 16% 12% 12% 10% 8% 8% 7% 6% 31% 28% 16% 12% 10% 8% 8% 7% 6% 6%

Mkt Share

Mkt Share

9,500

6,900

5,700

4,500 4,500

3,800 3,700

3,0002,600

2,200

Unama Esamaz Cesupa FACI Ipiranga Fibra Esmac Famaz

1,100

10,600

+ FMN

4

IESAMAt-a-glance

• Located in Belém

• Controlling Institution: Organização Paraense Educacional e de Empreendimentos Ltda.

• Higher Education Institution: Instituto de estudos Superiores da Amazônia -IESAM

• For-profit institution (limited company)

• 23 undergraduate courses

• 9 in Engineering

• 7 in Management

• 6 Technological

• 18 graduate courses

• 4 in Finance and Management

• 3 in Communication and Design

• 7 in Engineering

• 4 in Technology

• Net Revenue (2013A): R$31 millionNet Revenue (2014E): R$33 million

• Student base (2013): 4,000Student base (2014) (MoU): 4,500

• IESAM’s Net Average Ticket: R$654Estácio’s Net Average Ticket: R$552

The Company

+19%

Index Grade Year

CI - Institutional Concept 3 2009

IGC -General Course Index 3 2012

Continuous IGC 2,12 2012

MEC’s Evaluation

5

IESAMOperational Information

Morning47.7%

Afternoon 3.1%

Night 49.1%

Shift Distribution

12.9%

41.5%

79.3%

46.2%

7.8% 12.3%

Matrículas (2014/01) Vagas Ociosas

Student Base

Gestão Engenharia Tecnólogos

1,405 1,5822,001

2,614452 393

620

773

791 645

538

417

435 428

423

369

2010 2011 2012 2013

Student Base Evolution – Subject Area

Engenharias Pós-graduação Gestão Tecnólogos

Regulatory

Course ENADE CPC CC

Business Administration 2 3 4

Accounting 2 2 5

Multimedia 2 3 5

Public Relations - - 3

Design: Products 4 4 -

Environmental Engineering - - 4

Electrical Engineering - - 3

Computer Engineering 1 2 5

Control and Automation Eng. 2 2 4

Telecommunications Engineering 3 3 5

Mechanical Engineering - - 3

Civil Engineering - - 4

Production Engineering - - -

Architecture - - -

Industrial Maintenance 2 2 3

Computer Networks - - 3

Digital Games - - -

Workplace Safety - - 3

Information System 1 2 4

Metallurgical Engineering - - 3

Construction Control - - -

Audiovisual production - - -

Tourism 3 SC 3

Idle SeatsEnrollments (14.1)

TechnologicalMgmtGraduateEngineering

Mgmt Eng. Technological

6

IESAMSeats - Idleness

3,894

11,546

Total Seats

Matrículas (2014/01) Vagas Ociosas

92%

66%84%

Gestão Engenharia Tecnólogos

Idleness by Subject Area

Regulatory

CourseAnnual

Seats

Duration

(Years)Total

Enrollments

(2014/01)

Idleness

(%)

400 4 1.600 50 97%

200 4 800 58 93%

150 4 600 118 80%

150 4 600 20 97%

150 4 600 84 86%

180 5 900 364 60%

180 5 900 524 42%

200 5 1,000 334 67%

150 5 750 395 47%

200 5 1,000 140 86%

180 5 900 435 52%

120 5 600 291 52%

120 5 600 188 69%

150 5 750 125 83%

100 3 300 104 65%

120 3 300 55 82%

120 3 360 62 83%

120 3 360 54 85%

150 4 600 126 79%

180 5 900 0 100%

60 3 180 0 100%

120 2 240 0 100%

150 4 600 0 100%

Graduate na na na na na

Total 3,650 15,440 3,527 77%

Idle SeatsEnrollments (14.1)

Business Administration

Accounting

Multimedia

Public Relations

Design: Product DesignEnvironmental Engineering

Electrical Engineering

Computer EngineeringControl and Automation Eng.Telecommunications EngineeringMechanical Engineering

Civil EngineeringProduction EngineeringArchitecture

Industrial MaintenanceComputer Networks

Digital GamesWorkplace Safety

Information System

Metallurgical Engineering

Construction ControlAudiovisual productionTourism

Mgmt Engineering Technological

7

IESAMStrategic Rationale / Attention Point

Strategic Rationale

Growth Driver

- Consolidates the operation in Belém, making us market share leaders with around 11,000 students - Excellent expansion alternative considering the IGC grade 2, the seat limits for the Business Administration course and

the capacity constraints of Estácio FAP. - IESAM’s course portfolio fully complements the one offered by Estácio FAP. We also have a greenfield protocol filed to

open a campus in the city.

Location- Located in one the main avenues of one of the city’s most traditional neighborhoods, with a large flow of people, cars and public transport.

Infrastructure- Currently has 62 classrooms, 12 computer labs and 40 specific labs. - Possible fast and low-cost expansion (24 additional classrooms).- Expansion of 20 additional classrooms requires more resources (around R$2 million)

Recently authorized courses

From 2013 and 2014 onwards, IESAM had new courses authorized: Production Engineering, Civil Engineering, Metallurgical Engineering and Architecture, for a total of 2,850 seats and 700 enrolled students, offering good growth potential in the short-term with the maturation of these courses.

Idleness- 75% of total seats are idle.- Most of these seats are from Business Administration and Accounting programs, which have a combined idleness of 91% (around 2,000 seats), besides the recently authorized courses described above.

Synergies- Cost optimization: Administrative staff and mostly Selling and Marketing expenses, positively impacting our

consolidated operation in the city of Belém

8

IESAMValuation

Result

• PV - 2024 R$ 56.2 million

• PV – Perpet.:R$ 64.4 million

• Total EV:R$ 120.6 million

• IRR: 28.4%

P&L Statement 2014-02 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 CAGR

Average Student Base 4,865 6,154 7,122 7,872 8,364 8,485 8,596 8,707 8,820 8,934 9,050 7.8%

YoY 22.6% 26.5% 15.7% 10.5% 6.3% 1.5% 1.3% 1.3% 1.3% 1.3% 1.3%

Net Revenue 19.5 48.2 50.6 54.4 60.8 64.8 68.9 73.8 79.0 84.7 90.7 10.3%

Personnel (10.5) (23.2) (23.1) (23.5) (23.5) (25.0) (26.5) (27.4) (29.3) (31.4) (33.6)

Administrative Staff (3.8) (8.5) (7.8) (7.2) (5.5) (5.8) (6.2) (6.6) (7.1) (7.6) (8.2)

Faculty (5.5) (13.5) (14.2) (15.3) (17.1) (18.2) (19.3) (20.7) (22.2) (23.8) (25.4)

Other G&A (2.9) (6.7) (6.6) (6.5) (7.3) (7.8) (8.3) (8.9) (9.5) (10.2) (10.9)

Rentals (1.1) (4.5) (4.7) (5.0) (5.2) (5.5) (5.7) (6.0) (6.3) (6.6) (7.0)

Selling and Marketing (1.3) (3.1) (3.3) (3.5) (4.0) (4.2) (4.5) (4.8) (5.1) (5.5) (5.9)

PDA (1.2) (2.9) (3.0) (3.3) (3.6) (3.9) (4.1) (4.4) (4.7) (5.1) (5.4)EBITDA 2.5 7.8 9.9 12.6 17.2 18.4 19.7 22.3 24.0 25.9 27.9 10.4%

Free Cash Flow for the Firm 2014-02 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

EBIT 2.5 7.8 9.9 12.6 17.2 18.4 19.7 22.3 24.0 25.9 27.9

Tax (4.5) (0,3) (0,4) (0,6) (0,8) (0,8) (0,9) (1,0) (1,1) (1,2) (1,3)

NOPAT (2.0) 7.4 9.4 12.1 16.4 17.6 18.9 21.3 23.0 24.7 26.6

Working Capital (0.8) (1.0) (1.0) (1.1) (1.2) (1.3) (1.4) (1.5) (1.6) (1.7) (1.8)

Capex (1.2) (2.9) (2.5) (2.7) (2.4) (2.6) (2.1) (1.5) (1.6) (1.7) (1.8) Perp.

FCFF (4.0) 3.6 5.9 8.2 12.7 13.7 15.4 18.4 19.8 21.3 23.0 251.4

P&L Statement 2014-02 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Net Revenue 100% 100% 100% 100% 100% 100% 100,0% 100,0% 100,0% 100,0% 100,0%

Personnel -47.8% -45.6% -43.5% -41.4% -37.1% -37.1% -37.1% -37.1% -37.1% -37.1% -37.1%

Administrative -19.7% -17.6% -15.4% -13.3% -9.0% -9.0% -9.0% -9.0% -9.0% -9.0% -9.0%

Faculty -28.1% -28.1% -28.1% -28.1% -28.1% -28.1% -28.1% -28.1% -28.1% -28.1% -28.1%

Other G&A -15.0% -14.0% -13.0% -12.0% -12.0% -12.0% -12.0% -12.0% -12.0% -12.0% -12.0%

Rentals -5.7% -9.3% -9.3% -9.1% -8.6% -8.4% -8.3% -8.2% -8.0% -7.8% -7.7%

Selling and Marketing -6.5% -6.5% -6.5% -6,5% -6.5% -6.5% -6.5% -6.5% -6.5% -6.5% -6.5%

PDA -6.0% -6.0% -6.0% -6.0% -6.0% -6.0% -6.0% -6.0% -6.0% -6.0% -6.0%

EBITDA Margin 12.8% 16.1% 19.5% 23.2% 28.2% 28.4% 28.6% 30.3% 30.4% 30.6% 30.7%

Free Cash Flow for the Firm 2014-02 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Working Capital (% of Net Revenue) 4.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%

Capex (% of Net Revenue) 6.0% 6.0% 5.0% 5.0% 4.0% 4.0% 3.0% 2.0% 2.0% 2.0% 2.0%