Lightspan Signs $1.6 Million Contract to Deliver Online Assessments In All Austin, Texas Schools

July 25, 2002

SAN DIEGO, July 24 /PRNewswire-FirstCall/ —

Lightspan, Inc. (Nasdaq: LSPN), a leading provider of high-quality educational products and services used in schools and homes to help increase academic achievement, announced today that it has signed a multi-year contract valued at approximately $1.6 million to provide benchmark assessments to students in all 105 schools in the Austin, Texas Independent School District (AISD).

Lightspan will provide benchmark tests aligned to the Texas Assessment of Knowledge and Skills (TAKS), the new statewide test, for AISD students in grades K-12, over the next three years. AISD administrators will have access to real-time, online reports, which will allow them to view critical student data over multiple years and across various sub-groups of students.

Denise Collier, AISD Curriculum Director, said: “Continuous assessment throughout the school year, especially benchmarking that can be evaluated across the whole city, is crucial to improving student achievement in all of our schools — for all of our students. We evaluated many companies and chose Lightspan because of their proven experience helping school districts tailor online assessments to be aligned with specific statewide tests. Lightspan was also able to provide our district with the flexibility to integrate online assessment and reporting with our current paper-and-pencil assessments.”

AISD Superintendent Pat Forgione praised the Austin School District Board of Trustees’ commitment to benchmark testing, despite an extremely tight fiscal year.

John T. Kernan, Lightspan Chairman and CEO, stated: “School districts across the country depend on Lightspan to help them provide classroom assessment tools for teachers, students and parents. At the same time, more school districts across the country are turning to Lightspan for assistance with larger, multi-year district wide assessments. This is especially important because of the increasing demands for student achievement and accountability under the No Child Left Behind legislation.”

AISD plans to implement benchmarking at the beginning of the upcoming school year using a combination of test items created by Lightspan and Austin ISD, tailored to meet the district’s specific needs.

The initiative also has support from within the Austin-area business community, including the Austin Area Research Organization, which is committed to helping guide Austin ISD’s educational efforts.

About Lightspan, Inc.

Lightspan(R), Inc. (Nasdaq: LSPN), provides curriculum-based educational software and Internet products and services that increase student achievement and enhance teacher professional development. These products are used in schools and homes and align to all key federal education reform initiatives, offering school districts a complete solution to assess, align, instruct and evaluate, as a comprehensive achievement and accountability system. More than 900 independent studies prove Lightspan products enhance student achievement, improve teacher effectiveness and help build stronger connections with families.

Lightspan offers products in the following areas: early reading (The Lightspan Early Reading Program(TM) and the Lightspan Reading Center(TM)), K-8 interactive curriculum (Lightspan Achieve Now(TM)), K-12 online teacher resources and professional development (The Lightspan Network(R)), assessment (Lightspan eduTest Assessment(TM) and Lightspan Assessment Builder(TM)), and secondary and higher education (Interactive Mathematics, Interactive English, and

“Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This release contains forward looking statements, including statements related to performance by the Company and third parties under contracts, future financial performance, cash position, government funding and business trends, that are subject to risks and uncertainties, including, but not limited to, actual performance of third parties and the Company, changes in economic conditions in the Company’s market areas; changes in policies by regulatory agencies and educational organizations; the volatility of the Company’s expenses and operating results; market acceptance of the Company’s curriculum based software and Internet products; management of rapid growth; risks associated with expanding the Company’s Internet business; changes in funding for public schools; technological advances and risks related thereto and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission including its Annual Report on Form 10-K for the fiscal year ended January 31, 2002 filed with the Commission on April 30, 2002. The Company cautions readers not to place undue reliance on any forward-looking statements. The Company does not undertake, and specifically disclaims any obligation, to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause the Company’s actual results for fiscal 2003 and beyond to differ materially from those expressed in any forward looking statements by, or on behalf of, the Company.

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