Edgar Filing: CAPELLA EDUCATION CO

Ownership Submission

FORM 3

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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3235-0104

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(Print or Type Responses)

1. Name and Address of Reporting Person ^*

Â Insight-Salmon River LLC

2. Date of Event Requiring Statement (Month/Day/Year)
11/09/2006

3. Issuer Name and Ticker or Trading Symbol
CAPELLA EDUCATION CO [CPLA]

(Last)

(First)

(Middle)

680 FIFTH AVE, 8TH FLOOR,Â

4. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

_____ Director	__X__ 10% Owner
_____ Officer (give title below)	_____ Other (specify below)

5. If Amendment, Date Original Filed(Month/Day/Year)

(Street)

NEW YORK,Â NYÂ 10019

6. Individual or Joint/Group Filing(Check Applicable Line)
___ Form filed by One Reporting Person
_X_ Form filed by More than One Reporting Person

(City)

(State)

(Zip)

Table I - Non-Derivative Securities Beneficially Owned

1.Title of Security (Instr. 4)	2. Amount of Securities Beneficially Owned (Instr. 4)	3. Ownership Form: Direct (D) or Indirect (I) (Instr. 5)	4. Nature of Indirect Beneficial Ownership (Instr. 5)
Common Stock	24,308	D ⁽¹⁾	Â
Common Stock	194	D ⁽²⁾	Â
Common Stock	2,997	D ⁽³⁾	Â
Common Stock	3,251	D ⁽⁴⁾	Â

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.			SEC 1473 (7-02)
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Table II - Derivative Securities Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)

1. Title of Derivative Security (Instr. 4)	2. Date Exercisable and Expiration Date (Month/Day/Year)		3. Title and Amount of Securities Underlying Derivative Security (Instr. 4)		4. Conversion or Exercise Price of Derivative Security	5. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 5)	6. Nature of Indirect Beneficial Ownership (Instr. 5)
1. Title of Derivative Security (Instr. 4)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	4. Conversion or Exercise Price of Derivative Security		6. Nature of Indirect Beneficial Ownership (Instr. 5)
Series D Preferred Stock	Â ⁽⁵⁾	Â ⁽⁵⁾	Common Stock	750,000	$ ⁽⁵⁾	D ⁽⁶⁾	Â
Series D Preferred Stock	Â ⁽⁵⁾	Â ⁽⁵⁾	Common Stock	272,222	$ ⁽⁵⁾	D ⁽⁷⁾	Â
Series E Preferred Stock	Â ⁽⁵⁾	Â ⁽⁵⁾	Common Stock	140,351	$ ⁽⁵⁾	D ⁽⁸⁾	Â
Series G Preferred Stock	Â ⁽⁵⁾	Â ⁽⁵⁾	Common Stock	25,736	$ ⁽⁵⁾	D ⁽⁹⁾	Â

Reporting Owners

Reporting Owner Name / Address	Relationships
Reporting Owner Name / Address	Director	10% Owner	Officer	Other
Insight-Salmon River LLC 680 FIFTH AVE, 8TH FLOOR NEW YORK,Â NYÂ 10019	Â	Â X	Â	Â
SALMON RIVER CAPITAL I, LLC 680 FIFTH AVENUE, 8TH FLOOR NEW YORK,Â NYÂ 10019	Â	Â X	Â	Â
SALMON RIVER CIP, LLC 680 FIFTH AVE, 8TH FLOOR NEW YORK,Â NYÂ 10019	Â	Â X	Â	Â
Insight Venture Partners IV (Fund B), L.P. 680 FIFTH AVENUE, 8TH FLOOR NEW YORK,Â NYÂ 10019	Â	Â X	Â	Â
Insight Venture Partners IV (Co-Investors), L.P. 680 FIFTH AVENUE, 8TH FLOOR NEW YORK,Â NYÂ 10019	Â	Â X	Â	Â
INSIGHT VENTURE PARTNERS IV LP 527 MADISON AVENUE 10TH FLOOR NEW YORK,Â NYÂ 10022	Â	Â X	Â	Â
Insight Venture Partners IV (Cayman), L.P. 680 FIFTH AVENUE, 8TH FLOOR NEW YORK,Â NYÂ 10019	Â	Â X	Â	Â
SALMON RIVER CAPITAL II LP SALMON RIVER CAPITAL LLC 680 FIFTH AVENUE 8TH FL NEW YORK,Â NYÂ 10019	Â	Â X	Â	Â

Signatures

/s/ Joshua Lewis		11/09/2006
^**Signature of Reporting Person		Date
/s/ Jeffrey Horing		11/09/2006
^**Signature of Reporting Person		Date
/s/ Joshua Lewis		11/09/2006
^**Signature of Reporting Person		Date
/s/ Joshua Lewis		11/09/2006
^**Signature of Reporting Person		Date
/s/ Jeffrey Horing		11/09/2006
^**Signature of Reporting Person		Date
/s/ Jeffrey Horing		11/09/2006
^**Signature of Reporting Person		Date
/s/ Jeffrey Horing		11/09/2006
^**Signature of Reporting Person		Date
/s/ Joshua Lewis		11/09/2006
^**Signature of Reporting Person		Date

Explanation of Responses:

*	If the form is filed by more than one reporting person, see Instruction 5(b)(v).
**	Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1)	The amount shown represents the beneficial ownership of the Issuer's securities owned by Insight Venture Partners IV, L.P, ("IV LP"). Insight Venture Associates IV, LLC (the "Insight GP") is the sole general partner of IV LP. The Insight GP and Insight Holdings Group, LLC, the managing member of the Insight GP ("Insight Holdings"), exercise voting and investment power with respect to such shares. Each of Insight GP and Insight Holdings disclaims beneficial ownership of such shares except to the extent of their pecuniary interest therein.
(2)	The amount shown represents the beneficial ownership of the Issuer's securities owned by Insight Venture Partners IV (Fund B), L.P. ("IV (Fund B)"). The Insight GP is the sole general partner of IV (Fund B). The Insight GP and Insight Holdings exercise voting and investment power with respect to such shares. Each of Insight GP and Insight Holdings disclaims beneficial ownership of such shares except to the extent of their pecuniary interest therein.
(3)	The amount shown represents the beneficial ownership of the Issuer's securities owned by Insight Venture Partners IV (Co-Investors), L.P. ("IV Co-Investors"). The Insight GP is the sole general partner of IV (Co-Investors). The Insight GP and Insight Holdings exercise voting and investment power with respect to such shares. Each of the Insight GP and Insight Holdings disclaims beneficial ownership of such shares except to the extent of their pecuniary interest therein.
(4)	The amount shown represents the beneficial ownership of the Issuer's securities owned by Insight Venture Partners (Cayman) IV, L.P. ("IV Cayman" and together with IV LP, IV (Fund B) and IV Co-Investors, the "Insight Funds"). Insight GP is the sole general partner of. IV Cayman. The Insight GP and Insight Holdings exercise voting and investment power with respect to such shares. Each of the Insight GP and Insight Holdings disclaims beneficial ownership of such shares except to the extent of their pecuniary interest therein.
(5)	None of the Series D, Series E or Series G Preferred Stock has an expiration date and each will convert automatically into common stock upon the consummation of the initial public offering of the Issuer. The conversion ratio of the Series D and Series G Preferred Stock is one share of common stock for each share of preferred stock. The conversion ratio for the Series E Preferred Stock is 1.04038 share of common stock for each share of Series E Preferred Stock. No additional consideration will be paid to the Issuer in connection with the conversion.
(6)	See Remarks.
(7)	The amount shown represents the beneficial ownership of the Issuer's securities owned by Salmon River Capital I LLC. The managing member of Salmon River Capital I LLC is Salmon River Capital LLC. The managing member of Salmon River Capital LLC is Mr. Lewis. Mr. Lewis has voting and investment powers with to the shares beneficially owned by Salmon River Capital I LLC. Mr. Lewis disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein.
(8)	The amount shown represents the beneficial ownership of the Issuer's securities owned by Salmon River CIP LLC. The managing member of Salmon River CIP LLC is Salmon River Capital LLC. The managing member of Salmon River Capital LLC is Mr. Lewis. Mr. Lewis has voting and investment powers with to the shares beneficially owned by Salmon River Capital I LLC. Mr. Lewis disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein.
(9)	The amount shown represents the beneficial ownership of the Issuer's securities owned by Salmon River Capital II, L.P. The general partner of Salmon River Capital II, L.P. is Salmon River Capital GP, LLC. The sole member of Salmon River Capital GP, LLC is Mr. Lewis. Accordingly, Mr. Lewis has voting and investment powers with respect to the shares beneficially owned by Salmon River Capital II, L.P. Mr. Lewis disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein.
Â Remarks: (6)Â TheÂ amountÂ shownÂ representsÂ theÂ beneficialÂ ownershipÂ ofÂ theÂ Issuer'sÂ securitiesÂ ownedÂ byÂ Insight-SalmonÂ RiverÂ LLC.Â Â The Â managingÂ memberÂ ofÂ InsightÂ -SalmonÂ RiverÂ LLCÂ isÂ SalmonÂ RiverÂ CapitalÂ LLC,Â andÂ theÂ non-managingÂ membersÂ ofÂ Insight-Salmon Â RiverÂ LLCÂ areÂ theÂ InsightÂ Funds.Â Â SalmonÂ RiverÂ CapitalÂ LLC,Â asÂ managingÂ memberÂ ofÂ Insight-SalmonÂ RiverÂ LLC,Â generally Â controlsÂ theÂ votingÂ powerÂ overÂ theÂ sharesÂ heldÂ byÂ Insight-SalmonÂ RiverÂ LLC,Â butÂ theÂ InsightÂ FundsÂ haveÂ sharedÂ votingÂ power Â withÂ SalmonÂ RiverÂ CapitalÂ LLCÂ overÂ theÂ sharesÂ withÂ respectÂ toÂ certainÂ matters.Â Â InÂ addition,Â SalmonÂ RiverÂ CapitalÂ LLCÂ and Â theÂ InsightÂ FundsÂ haveÂ sharedÂ investmentÂ powerÂ overÂ theÂ sharesÂ heldÂ byÂ InsightÂ -SalmonÂ RiverÂ LLC.Â Â TheÂ managingÂ memberÂ of Â SalmonÂ RiverÂ CapitalÂ LLCÂ isÂ S.Â JoshuaÂ Lewis,Â aÂ directorÂ ofÂ theÂ Issuer.Â Â TheÂ managingÂ memberÂ ofÂ theÂ InsightÂ GPÂ isÂ Insight Â Holdings.Â Â Accordingly,Â Mr.Â Lewis,Â theÂ InsightÂ GPÂ andÂ InsightÂ HoldingsÂ haveÂ sharedÂ votingÂ andÂ investmentÂ powersÂ withÂ respect Â toÂ heÂ sharesÂ beneficiallyÂ ownedÂ byÂ Insight-SalmonÂ RiverÂ LLC.Â Â TheÂ foregoingÂ isÂ notÂ anÂ admissionÂ byÂ suchÂ personsÂ thatÂ such Â personsÂ areÂ theÂ beneficialÂ ownersÂ ofÂ theÂ sharesÂ heldÂ byÂ Insight-SalmonÂ RiverÂ LLC,Â andÂ eachÂ disclaimsÂ beneficialÂ ownershipÂ of Â suchÂ sharesÂ exceptÂ toÂ theÂ extentÂ ofÂ theirÂ pecuniaryÂ interestÂ therein.

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