Exhibit 10.1

FORM OF

CAREER EDUCATION CORPORATION

2008 INCENTIVE COMPENSATION PLAN

NON-QUALIFIED STOCK OPTION AGREEMENT

[GENERAL COUNSEL]

This STOCK OPTION AGREEMENT (this “Agreement”), dated [                    ], by
and between Career Education Corporation, a Delaware corporation (the
“Company”), and [                    ] (the “Grantee”).

In accordance with Section 6 of the Career Education Corporation 2008 Incentive
Compensation Plan (the “Plan”) and subject to the terms of the Plan and this
Agreement, the Company hereby grants to the Grantee an option to purchase shares
of common stock, par value $0.01 per share, of the Company (“Shares”) on the
terms and conditions as set forth below (“Option”). The Option granted hereby is
not intended to constitute an Incentive Stock Option, within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”). All
capitalized terms used, but otherwise not defined herein, shall have the
meanings set forth in the Plan.

To evidence the Option and to set forth its terms, the Company and the Grantee
agree as follows:

1. Grant. The Committee hereby grants this Option to the Grantee on
[                    ] (the “Grant Date”) for the purchase from the Company of
all or any part of an aggregate of              Shares (subject to adjustment as
provided in Section 4.2 of the Plan.

2. Option Price. The purchase price of this Option shall be equal to $        
per Share (the “Option Price”) (subject to adjustment as provided in Section 4.2
of the Plan). The Option Price is equal to 100% of the Fair Market Value of one
Share of Common Stock on the Grant Date, as calculated under the Plan.

3. Term and Vesting of the Option. The Option Term shall expire on the tenth
anniversary of the Grant Date, and, except as otherwise provided herein, vested
Shares subject to this Option may be exercised either upon or following the
applicable vesting dates (set forth in the table below), as long as such
exercise occurs prior to the expiration of this Option as provided in this
Agreement and the Plan. The applicable vesting dates for the Shares subject to
this Option are as follows:

 

Vesting Date

   Percentage of Option Shares
Vested  

1st Anniversary of Grant Date

   25 %

2nd Anniversary of Grant Date

   50 %

3rd Anniversary of Grant Date

   75 %

4th Anniversary of Grant Date

   100 %

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Notwithstanding the foregoing provisions of this Paragraph 3, and except as
otherwise determined by the Committee, as provided in the Plan or as provided
herein, any portion of this Option which is not vested (or otherwise not
exercisable) at the time of the Grantee’s Termination of Service with the
Company and its Subsidiaries shall not become exercisable after such termination
and shall be immediately cancelled and forfeited to the Company.

4. Exercisability. In the event the Grantee incurs a Termination of Service for
any reason, the Grantee will have such rights with respect to this Option as are
provided for in the Plan.

5. Exercise of Option. On or after the date any portion of the Option becomes
exercisable, but prior to the expiration of the Option in accordance with
Paragraphs 3 and 4 above, the portion of the Option that has become exercisable
may be exercised in whole or in part by the Grantee (or, pursuant to Paragraph 6
hereof, by his or her permitted successor) upon delivery of the following to the
Company:

(a) a written notice of exercise which identifies this Agreement and states the
number of whole Shares then being purchased; and

(b) any combination of cash (or by certified or personal check or wire transfer
payable to the Company), and/or (i) with the approval of the Committee, Shares
or Shares of Restricted Stock then owned by the Grantee in an amount having a
combined Fair Market Value on the exercise date equal to the aggregate Option
Price of the Shares then being purchased, or (ii) unless otherwise prohibited by
law for either the Company or the Grantee, an irrevocable authorization of a
third party to sell Shares acquired upon the exercise of the Option and promptly
remit to the Company a sufficient portion of the sale proceeds to pay the entire
Option Price and any tax withholdings resulting from such exercise.

Notwithstanding the foregoing, the Grantee (or any permitted successor) shall
take whatever additional actions, including, without limitation, the furnishing
of an opinion of counsel, and execute whatever additional documents the Company
may, in its sole discretion, deem necessary or advisable in order to carry out
or effect one or more of the obligations or restrictions imposed by the Plan,
this Agreement or applicable law.

No Shares shall be issued upon exercise of the Option until full payment has
been made. Upon satisfaction of the conditions and requirements of this
Paragraph 5 and the Plan, the Company shall deliver to the Grantee (or his or
her permitted successor) a certificate or certificates for the number of Shares
in respect of which the Option shall have been exercised. Upon exercise of the
Option (or a portion thereof), the Company shall have a reasonable time to issue
the Common Stock for which the Option has been exercised, and the Grantee shall
not be treated as a stockholder for any purposes whatsoever prior to such
issuance. No adjustment shall be made for cash dividends or other rights for
which the record date is prior to the date such Common Stock is recorded as
issued and transferred in the Company’s official stockholder records, except as
otherwise provided in the Plan or this Agreement.

 

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6. Limitation Upon Transfer. This Option and all rights granted hereunder shall
not (a) be transferred by the Grantee, other than by will, by the laws of
descent and distribution, or to a Permitted Transferee; (b) be otherwise
assigned, pledged or hypothecated in any way; and (c) be subject to execution,
attachment or similar process. Any attempt to transfer this Option, other than
by will or by the laws of descent and distribution or to a Permitted Transferee,
or to assign, pledge or hypothecate or otherwise dispose of this Option or of
any rights granted hereunder contrary to the provisions hereof, or upon the levy
of any attachment or similar process upon this Option or such rights, shall be
void and unenforceable against the Company or any Subsidiary; provided, however,
that the Grantee may designate a Beneficiary to receive benefits in the event of
the Grantee’s death. This Option shall be exercised during the Grantee’s
lifetime only by the Grantee, the Grantee’s guardian, the Grantee’s legal
representative or a Permitted Transferee.

7. Change in Control. Upon a Change in Control, the Grantee will have such
rights with respect to this Option as are provided for in the Plan.

8. Effect of Amendment of Plan. No discontinuation, modification, or amendment
of the Plan may, without the written consent of the Grantee, adversely affect
the rights of the Grantee under this Option, except as otherwise provided under
the Plan.

This Agreement may be amended as provided under the Plan, but no such amendment
shall adversely affect the Grantee’s rights under the Agreement without the
Grantee’s written consent, unless otherwise permitted by the Plan.

9. No Limitation on Rights of the Company. The grant of this Option shall not in
any way affect the right or power of the Company to make adjustments,
reclassifications, or changes in its capital or business structure or to merge,
consolidate, dissolve, liquidate, sell or transfer all or any part of its
business or assets.

10. Rights as a Stockholder. The Grantee shall have the rights of a stockholder
with respect to the Shares subject to this Option only upon becoming the holder
of record of such Shares.

11. Compliance with Applicable Law. Notwithstanding anything herein to the
contrary, the Company shall not be obligated to cause to be issued or delivered
any certificates for Shares pursuant to the exercise of this Option, unless and
until the Company is advised by its counsel that the issuance and delivery of
such certificates is in compliance with all applicable laws, regulations of
governmental authority, and the requirements of any exchange upon which Shares
are traded. The Company may require, as a condition of the issuance and delivery
of such certificates and in order to ensure compliance with such laws,
regulations and requirements, that the Grantee make such covenants, agreements,
and representations as the Company, in its sole discretion, considers necessary
or desirable.

 

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12. No Obligation to Exercise Option. The granting of this Option shall impose
no obligation upon the Grantee to exercise this Option.

13. Agreement Not a Contract of Employment or Other Relationship. This Agreement
is not a contract of employment, and the terms of employment of the Grantee or
other relationship of the Grantee with the Company or its Subsidiaries shall not
be affected in any way by this Agreement except as specifically provided herein.
The execution of this Agreement shall not be construed as conferring any legal
rights upon the Grantee for a continuation of an employment or other
relationship with the Company or its Subsidiaries, nor shall it interfere with
the right of the Company or its Subsidiaries to discharge the Grantee and to
treat him or her without regard to the effect that such treatment might have
upon him or her as a Grantee.

14. Withholding. If the Company is obligated to withhold an amount on account of
any tax imposed as a result of the exercise of this Option, the Grantee shall be
required to pay such amount to the Company, or make arrangements satisfactory to
the Committee regarding the payment of such amount, as provided in Section 17 of
the Plan. The obligations of the Company under the Plan shall be conditional on
such payment or arrangements, and the Company shall, to the extent permitted by
law, have the right to deduct any such taxes from any payment otherwise due to
the Grantee. The Grantee acknowledges and agrees that he or she is responsible
for the tax consequences associated with the grant and exercise of this Option.

15. Notices. Any communication or notice required or permitted to be given
hereunder shall be in writing, and, if to the Company, to its principal place of
business, attention: Secretary, and, if to the Grantee, to the address appearing
on the records of the Company. Such communication or notice shall be delivered
personally or sent by certified, registered, or express mail, postage prepaid,
return receipt requested, or by a reputable overnight delivery service. Any such
notice shall be deemed given when received by the intended recipient.

16. Governing Law. Except to the extent preempted by federal law, this Agreement
shall be construed and enforced in accordance with, and governed by, the laws of
the State of Delaware without regard to the principles thereof relating to the
conflicts of laws.

17. Receipt of Plan. The Grantee acknowledges receipt of a copy of the Plan, and
represents that the Grantee is familiar with the terms and provisions thereof,
and hereby accepts this Option subject to all the terms and provisions of this
Agreement and of the Plan. The Option is granted pursuant to the terms of the
Plan, the terms of which are incorporated herein by reference, and the Option
shall in all respects be interpreted in accordance with the Plan. The Committee
shall interpret and construe the Plan and this Agreement, and its interpretation
and determination shall be conclusive and binding upon the parties hereto and
any other person claiming an interest hereunder, with respect to any issue
arising hereunder or thereunder.

 

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18. Restrictive Covenants. In consideration of receiving the Option hereunder,
and as a term and condition of the Grantee’s employment with the Company, the
Grantee agrees to adhere to, and be bound by, the following restrictions. The
Grantee hereby acknowledges that the Grantee’s job responsibilities give the
Grantee access to confidential and proprietary information belonging to the
Company and/or its subsidiaries, and that this and other confidential
information to which the Grantee has access would be of value, and provide an
unfair advantage, to a competitor in competing against the Company or its
subsidiaries in any of the markets in which the Company or its subsidiaries
maintains schools, provides on-line education classes or otherwise conducts
business. The Grantee further acknowledges that the following restrictions will
not cause the Grantee undue hardship. Consequently, the Grantee agrees that the
restrictions below are reasonable and necessary to protect the Company’s and/or
its subsidiaries’ legitimate business interests.

During the Grantee’s employment with the Company and/or any of its subsidiaries
and continuing for twelve (12) months thereafter, the Grantee will not, in any
way, directly or indirectly, either for the Grantee or any other person or
entity, whether paid or unpaid:

(a) Accept employment with, own, manage, operate, consult or provide expert
services to any person or entity that would result in the use, disclosure or
dissemination of confidential or proprietary information belonging to the
Company and/or its subsidiaries.

(b) Solicit, attempt to solicit, assist with the solicitation of, direct another
to solicit, or otherwise entice any employee of the Company or any of its
subsidiaries to leave his/her employment.

Should the Grantee breach the terms of these Restrictive Covenants, the Company
reserves the right to enforce the terms herein in court and seek any and all
remedies available to it in equity and law, and the Grantee agrees to pay the
Company’s attorneys’ fees and costs should it succeed on its claim(s). Further,
should the Grantee breach the terms of these Restrictive Covenants, the Grantee
will forfeit any right to the Option received hereunder, subject to the terms
and conditions of the applicable Plan, and the Grantee agrees to pay the
Company’s attorneys’ fees and costs incurred in recovering such Option.

19. Condition to Return Signed Agreement. This Agreement shall be null and void
unless the Grantee signs, dates, and returns this Agreement to the Company on or
before the thirty-third (33rd) day following the earliest of the date this
Agreement is (a) placed in the mail addressed to the Grantee at his or her home
address (as contained in the Company’s records); (b) delivered to the Grantee at
his or her e-mail address as contained in the Company’s internal e-mail
directory; or (c) hand delivered to the Grantee, as applicable.

20. Other Terms and Conditions. The foregoing does not modify or amend any terms
of the Plan. To the extent any provisions of the Agreement are inconsistent or
in conflict with any terms or provisions of the Plan, the Plan shall govern.

[Signature Page Follows]

 

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IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and year
first written above.

 

Career Education Corporation By:  

 

Name:  

 

Title:  

 

Grantee By:  

 

Name:  

 

Title:  

 

 

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