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                                                                    EXHIBIT 4.01

                                 AMENDMENT NO. 1
                               TO RIGHTS AGREEMENT

         AMENDMENT NO. 1, dated as of November 9, 1999 ("Amendment No. 1"), to
the Rights Agreement, dated as of October 1, 1996 (the "Rights Agreement")
between Education Management Corporation, a Pennsylvania corporation, and
ChaseMellon Shareholder Services, L.L.C., a New Jersey limited liability
company, successor to Mellon Bank, N.A., a national banking association, as
Rights Agent (the "Rights Agent").

         WHEREAS, the Company and the Rights Agent previously entered into the
Rights Agreement;

         WHEREAS, pursuant to Section 27 of the Rights Agreement, the Company
may from time to time supplement or amend any provision of the Rights Agreement
in accordance with the terms of such Section 27; and

         WHEREAS, the Company has determined that it is desirable to amend the
Rights Agreement as provided herein.

         NOW, THEREFORE, accordingly the Rights Agreement is amended as follows:

         1. The first sentence of Section 1(a) is hereby deleted in its
entirety, and the following new sentence is hereby inserted in lieu thereof:

         "Acquiring Person" shall mean any Person (as hereinafter defined) who
         or which, together with all Affiliates and Associates (as such terms
         are hereinafter defined) of such Person, shall be the Beneficial Owner
         (as hereinafter defined) of 17.5% or more of the Common Shares of the
         Company then outstanding, but shall not include (i) the Company, (ii)
         any Subsidiary (as hereinafter defined) of the Company, (iii) any
         employee benefit plan of the Company or of any Subsidiary of the
         Company, or any entity holding Common Shares for or pursuant to the
         terms of any such plan, (iv) a Person who or which shall become the
         Beneficial Owner of 17.5% or more of the Common Shares then
         outstanding, if the transaction in which such Person became the
         Beneficial Owner of 17.5% or more of the Common Shares then outstanding
         had received prior approval of a majority of the Board of Directors or
         (v) Baron Capital Group, Inc., BAMCO, Inc., Baron Capital Management,
         Inc., Baron Asset Fund (or any other fund or funds managed by an entity
         controlled by Ronald Baron) or Ronald Baron (collectively, the "Baron
         Holders"); provided, however, that the foregoing exception for the
         Baron Holders shall be effective only for so long as the Baron Holders
         and their respective Affiliates and Associates do not in the aggregate
         beneficially own more than 5,922,600 Common Shares of the Company, such
         number to be appropriately adjusted to reflect any stock split, stock
         dividend, reclassification, subdivision, consolidation or combination
         of the Common Shares after November 9, 1999 or the exercise of any
         Rights issued to the Baron Holders pursuant to this Agreement.

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         IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as
of the date first written above.


                                      EDUCATION MANAGEMENT CORPORATION
Attest:


By: /s/ Kathleen Clover               By: /s/ Robert T. McDowell
   --------------------------            ---------------------------------
   Kathleen Clover                       Name:  Robert T. McDowell
   Assistant Secretary                   Title: Executive Vice President and
                                                Chief Financial Officer


                                      CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
Attest:


By: /s/ Rita A. Swartz                By: /s/ Anita Landreau
   --------------------------            ---------------------------------
   Rita A. Swartz                        Name: Anita Landreau
   Vice President                        Title: Assistant Vice President




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