<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as Permitted by Rule 14a-6(3)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
Educational Development Corporation
-----------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Educational Development Corporation
-----------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
Notes:
<PAGE>
----------------------------------------
Educational Development Corporation
10302 East 55th Place, Suite B
Tulsa, Oklahoma 74146-6515
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----------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
July 25, 1996
----------------------------------------
TO THE SHAREHOLDERS OF
EDUCATIONAL DEVELOPMENT CORPORATION:
The 1996 Annual Meeting of Shareholders of Educational Development
Corporation, a Delaware Corporation ("EDC" or the "Company"), will be held
July 25, 1996, at 2:00 P.M., at the Sheraton Tulsa, 10918 East 41st Street,
Tulsa, Oklahoma, for the following purposes:
1. To elect two nominees as Class I Directors;
2. To transact such other business as may properly come before the meeting
or any adjournments thereof.
Only shareholders of record at the close of business on June 14, 1996 are
entitled to notice of and to vote at the meeting.
You are cordially invited to attend the meeting. Whether or not you plan
to attend the meeting, you are requested to sign and return the enclosed proxy
as promptly as possible in the enclosed postage paid envelope. You may revoke
your Proxy at any time before it is exercised at the meeting.
By Order of the Board of Directors
/s/ Randall W. White
Randall W. White
Chairman of the Board and President
Tulsa, Oklahoma
June 24, 1996
<PAGE>
EDUCATIONAL DEVELOPMENT CORPORATION
10302 East 55th Place, Suite B
Tulsa, Oklahoma 74146-6515
-----------------------
PROXY STATEMENT
-----------------------
This Proxy Statement is furnished in connection with the solicitation of
Proxies by the management of EDUCATIONAL DEVELOPMENT CORPORATION, a Delaware
corporation (the "Company" or "EDC"), for use at the Annual Meeting of
Shareholders of the Company to be held at the Sheraton Tulsa, 10918 East 41st
Street, Tulsa, Oklahoma, on Thursday, July 25, 1996, commencing at 2:00
P.M., and at all continuations and adjournments thereof. This Proxy
Statement and accompanying form of Proxy are first being mailed to
shareholders on or about June 24, 1996.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The Company's $.20 par value common stock is the only class of capital
stock authorized by its Amended and Restated Certificate of Incorporation.
The number of shares which may be voted at the meeting or any adjournment
thereof is 5,224,488 shares, which was the number outstanding as of June 14,
1996, the record date. Each shareholder is entitled to one vote for each
share held except that cumulative voting is authorized with respect to the
election of directors. In other words, solely for the purpose of electing
directors, each share will entitle the holder thereof to a number of votes
equal to the number of directors being elected and each shareholder may cast
all of his votes for a single nominee, or may distribute them among any two or
more nominees. The presence in person or by proxy of the holders of a
majority of the shares issued and outstanding at the meeting will constitute a
quorum for the transaction of business. Votes will be tabulated by an
inspector of election appointed by the Board of Directors of the Company.
As of June 14, 1996, the following were the only persons known to
management of the Company to be beneficial owners of more than five percent of
the Company's outstanding common stock. Unless otherwise noted, the persons
named below have sole voting and investment power with respect to such shares.
All share amounts have been adjusted to reflect the two-for-one stock split.
<TABLE>
<CAPTION>
Name and Address of Amount of Beneficial Percent of
Beneficial Owner Ownership Class (1)
<S> <C> <C>
Randall W. White
10385 South 76th E. Ave.
Tulsa, Oklahoma 74133 791,186 (2) 14.9%
Robert D. Berryhill
P.O. Box 740125
Tulsa, Oklahoma 74147-0125 361,610 6.9%
</TABLE>
- --------------------------
(1) The Percent of Class was calculated on the basis of the number of
outstanding shares plus the number of shares which may be acquired
pursuant to currently exercisable stock options, however, shares which
may be acquired by such person pursuant to currently exercisable stock
options are not deemed outstanding for purposes of computing the Percent
of Class of shares beneficially owned by any other person.
(2) Includes 100,000 shares as to which Mr. White has the right to acquire
beneficial ownership through the exercise of currently exercisable stock
options.
1
<PAGE>
As of June 14, 1996, the directors and nominees of the Company and the
directors and executive officers of the Company as a group were the beneficial
owners of the following amount of shares of common stock of the Company.
Unless otherwise noted, the persons named below have sole voting and
investment power with respect to such shares. All share amounts have been
adjusted to reflect the two-for-one stock split.
<TABLE>
<CAPTION>
Names of Directors and Amount of Beneficial Percent of
Nominees and Identity of Group Ownership Class (1)
<S> <C> <C>
G. Dean Cosgrove 20,000 .4 %
John M. Lare 20,350 .4 %
James F. Lewis 68,160 1.3 %
Robert D. Berryhill 361,610 6.9 %
Randall W. White 791,186 (2) 14.9 %
All directors and executive officers 1,425,659 (3) 26.7 %
as a group (7
persons)
</TABLE>
(1) The Percent of Class was calculated on the basis of the number of
outstanding shares plus the number of shares which may be acquired by
such person or group pursuant to currently exercisable stock options,
however, shares which may be acquired by such person or group pursuant
to currently exercisable stock options are not deemed outstanding for
purposes of computing the Percent of Class for shares beneficially owned
by any other person or group.
(2) Includes 100,000 shares as to which Mr. White has the right to acquire
beneficial ownership through the exercise of currently exercisable stock
options.
(3) Includes 110,000 shares as to which all directors and executive officers
have the right to acquire beneficial ownership through the exercise of
currently exercisable stock options.
NUMBER OF DIRECTORS
The Amended and Restated Certificate of Incorporation and By-laws of the
Company provide that the number of directors which shall constitute the whole
Board of Directors shall not be less than three (3) nor more than fifteen
(15). Within said limits, the number of directors shall be determined by
resolution of the Board of Directors or by the shareholders at the annual
meeting. The Board of Directors has adopted a resolution establishing five
(5) as the number of directors of the Company.
ELECTION OF DIRECTORS
In accordance with the Amended and Restated Certificate of Incorporation
and By-laws of the Company, the directors are divided into three classes,
Class I, Class II and Class III, and are elected for a full term of office
expiring at the third succeeding annual shareholders meeting following the
election to office and when a successor is duly elected and qualified. The
By-laws provide that such classes shall be as nearly equal in number as
possible. The term of office of Class I directors expires at the annual
meeting of shareholders to be held on July 25, 1996, the term of office of
Class II directors expires at the annual meeting of shareholders in 1997 and
the term of office of Class III directors expires at the annual meeting of
shareholders in 1998. At the Annual Meeting of Shareholders announced herein,
two directors shall be chosen to serve as Class I directors. They will be
elected for a full term of office expiring at the annual meeting of
shareholders in 1999, and will serve until a successor or successors are duly
elected and qualified. Unless authority to do so is withheld, the persons
named as proxies in the accompanying form of Proxy will vote the shares
represented thereby for the following nominees designated by the Board of
2
<PAGE>
Directors to serve as Class I directors. Although it is not anticipated that
the nominees will be unwilling or unable to serve, if any nominee should
decline or be unable to act as a director, the persons named as proxies in the
accompanying form of Proxy may, unless authority to do so is withheld, vote
for any substitute nominee or nominees proposed by the Board of Directors. The
business experience shown for the nominees has been their principal occupation
for at least the past five years.
The affirmative vote of a plurality of the shares present in person or by
proxy at the meeting and entitled to vote is required for the election of
directors. An abstention from voting will be tabulated as a vote withheld on
the election of directors and will be included in computing the number of
shares present for purposes of determining the presence of a quorum for the
meeting.
<TABLE>
<CAPTION>
NOMINEE
Director
Name and Business Experience Age Class Since
---------------------------- --- ----- -----
<S> <C> <C> <C>
John M. Lare 49 I 1986
President of Pegasus Foods, Inc., an owner and operator of Mexican quick
service restaurants since March, 1995. From October, 1992 to January,
1995, Mr. Lare was a Director and Vice President - Finance and
Administration for Webco Industries, Inc., a manufacturer and distributor
of steel tubing. From 1989 to October 1992, Mr. Lare was a Principal for
Pegasus Venture Capital and the Argent Group, investment banking and
leverage buyout firms.
James F. Lewis 55 I 1992
CEO of The Lewis Companies Inc., a Tulsa based holding firm that owns or
controls the following firms: Oil Capital Electric Inc., KBL Inc., FCE
Inc., OMNI Mechanical Services, Engineering Design Group Inc. and various
real estate holdings. He has been the CEO for the past twenty-six years.
He serves on the Oklahoma Bank IV advisory board of directors.
</TABLE>
<TABLE>
<CAPTION>
CONTINUING DIRECTORS
Director
Name and Business Experience Age Class Since
---------------------------- --- ----- -----
<S> <C> <C> <C>
Randall W. White 54 III 1984
Chairman of the Board of EDC since September 1986, President of EDC since
January 1986, and Treasurer of EDC since February 1984. From February
1980 until joining EDC in January 1983, Mr. White served as the Chief
Financial Officer of Nicor Drilling Company, Tulsa, Oklahoma, an oil and
gas drilling company.
Robert D. Berryhill 50 II 1986
Private Investor. Vice Chairman of the Board of EDC since October 1986.
He was President of Original Chili Bowl, Inc., Tulsa, Oklahoma, a food
manufacturing business, from August 1965 until January, 1992, and was
Vice President thereof for five years prior to his election as President.
G. Dean Cosgrove 62 II 1986
Independent Consultant since 1985. He served as Financial Vice President
and Treasurer of Mapco Inc., Tulsa, Oklahoma, an energy company, from
May 1984 until July 1985, and served as Vice President and Treasurer
thereof from January 1981 until May 1984.
</TABLE>
3
<PAGE>
THE BOARD OF DIRECTORS AND ITS COMMITTEES
During the fiscal year ended February 29, 1996, the Board of Directors held
three meetings. Each director attended all meetings of the Board of Directors
except for Robert D. Berryhill who did not attend one meeting.
The only standing committees of the Board of Directors are described as
follows:
(i) The Executive Committee/Compensation Committee is responsible for
assisting management in establishing long-range plans, budgets,
marketing and development plans and compensation policies for
employees. This Committee is responsible for administering the
Company's 1992 Incentive Stock Option Plan and the Incentive Stock
Option Plan of 1981. The Committee consists of Messrs. Cosgrove,
Berryhill and White. No separate meetings of this Committee were
held during the fiscal year ended February 29, 1996, all committee
actions having been taken by the Board of Directors as a whole
during the regular Board of Directors' meeting.
(ii) The Audit Committee is responsible for the review of reports of
external auditors and for liaison with the external auditing firm.
The Committee consists of Messrs. Lewis and Lare. No separate
meetings of this Committee were held during the fiscal year ended
February 29, 1996, all committee actions having been taken by the
Board of Directors as a whole during the regular Board of Directors'
meeting.
The Board of Directors has no nominating committee.
COMPENSATION OF DIRECTORS
As compensation for all services rendered as a director of the Company, the
Company has a standard arrangement whereby a director who is not also an
officer of the Company is paid $250 for each directors' meeting attended in
person. Each director who is not also an officer of the Company and who is a
member of and who attends a meeting of one of the Committees of the Board of
Directors is paid $150 for such attendance. Directors are not paid for
directors' meetings or Committee meetings held by means of conference
telephone calls.
COMPLIANCE WITH SECTION 16(a)
Under Section 16(a) of the Securities Exchange Act of 1934, the Company's
directors, its executive officers, and any persons holding more than ten
percent of the Company's Common Stock are required to report their initial
ownership of the Company's Common Stock and any subsequent changes in that
ownership to the Securities and Exchange Commission and to furnish the Company
with a copy of each such report. Specific due dates for these reports have
been established and the Company is required to disclose in this proxy
statement any failure to file by these dates during and with respect to fiscal
year 1996. To the Company's knowledge, based solely on review of the copies
of such reports furnished to the Company, during and with respect to fiscal
year 1996, all Section 16(a) filing requirements were satisfied.
4
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth certain information with respect to the
compensation of the Company's President during the fiscal years ended February
29, 1996, February 28, 1995 and February 28, 1994.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term Compensation
----------------------
Annual Compensation Awards Payouts
------------------- ------ -------
Name Other All
and Annual Restricted # Other
Principal Fiscal Compen- Stock Options/ LTIP Compen-
Position Year Salary Bonus sation (1) Awards SARs Payouts sation
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Randall W. White 1996 $90,000 -0- -0- -0- -0- -0- -0-
Chairman of the 1995 $90,000 $20,00 -0- -0- 20,000 -0- -0-
Board, President 1994 $77,500 $20,000 -0- -0- 30,000 -0- -0-
and Treasurer
</TABLE>
(1) Does not include the value of perquisites or other personal benefits
because the aggregate amount of such compensation, if any, did not
exceed the lesser of $50,000 or 10% of the annual salary and bonus in
any of the three fiscal years reported in the Summary Compensation
Table.
OPTION EXERCISES DURING FISCAL YEAR ENDED FEBRUARY 29, 1996
AND OPTION VALUES AT FEBRUARY 29, 1996
The following table sets forth certain information with respect to options
exercised by the Company's President during the fiscal year ended February 29,
1996, and the number and value of unexercised stock options held by him at the
end of the fiscal year, after giving effect of the two-for-one stock split.
<TABLE>
<CAPTION>
Value of
Number of Unexercised
Unexercised In-the-Money
Options Options
Shares Acquired Value at FY - End at FY - End
Name on Exercise Realized(2) February 29, 1996(1) February 29, 1996(3)
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Randall W. White 510,000 $6,438,750 100,000 $1,042,500
</TABLE>
(1) All unexercised options were exercisable as of February 29, 1996.
(2) Calculated by multiplying the number of shares acquired on exercise
times the difference between (a) the closing stock price of the Common
Stock at the exercise date and (b) the per share option exercise price.
(3) Calculated by multiplying the number of unexercised options times the
difference between (a) the closing stock price of the Common Stock at
February 29, 1996 and (b) the per share option exercise price.
5
<PAGE>
COMPARISON OF FIVE-YEAR CUMULATIVE RETURNS
ON AN INDEXED BASIS
The following graph compares the performance of the Company's Common Stock
with the performance of the Nasdaq Stock Market Total Return Index and the
Nasdaq Non-Financial Stock Index. The Center for Research in Security Prices
("CRSP") Index provided the Nasdaq indices used in this graph. The graph
assumes $100 was invested on February 28, 1991 in each of the Company's Common
Stock and the two Nasdaq indices.
The graph displayed below is presented in accordance with SEC requirements.
Stockholders are cautioned against drawing any conclusions from the data
contained therein, as past results are not necessarily indicative of future
performance. The graph in no way reflects the Corporation's forecast of future
financial performance.
PERFORMANCE GRAPH
COMPARISON OF FIVE-YEAR CUMULATIVE RETURN
Among the Company, Nasdaq Stock Market Total Return Index
and Nasdaq Non-Financial Stock Index
NASDAQ
NON EDUCATIONAL
NASDAQ STOCK MARKET FINANCIAL DEVELOPMENT
TOTAL RETURN INDEX STOCK INDEX CORPORATION
2/28/91 100.0 100.0 100.0
2/28/92 142.7 141.7 280.0
2/28/93 151.9 140.0 480.0
2/28/94 180.1 169.6 1070.0
2/28/95 182.3 166.8 2160.0
2/28/96 254.2 229.1 4000.0
6
<PAGE>
EMPLOYMENT CONTRACTS
The Company has an employment agreement with Randall W. White, President of
the Company, which expires March 1, 1997 and provides for minimum annual
compensation of $90,000 plus additional salary of $20,000 if profit before
taxes exceeds $600,000 for the fiscal year. Mr. White waived his $20,000 bonus
for FY 1996.
REVOCABILITY OF PROXY
A shareholder giving a Proxy has the power to revoke it at any time before
its exercise. A Proxy may be revoked by filing with the Secretary of the
Company a written revocation or a duly executed Proxy bearing a later date. A
Proxy will be suspended if the shareholder who executed it is present at the
meeting and elects to vote in person.
SPECIFICATIONS BY SHAREHOLDERS
Properly executed Proxies in the accompanying form which are filed before
the meeting and not revoked will be voted in accordance with the directions
and specifications contained therein.
SOLICITATION OF PROXIES
This solicitation is made on behalf of the Board of Directors of the
Company. The cost of soliciting these Proxies will be borne by the Company.
In addition to solicitation by mail, the Company may make arrangements with
brokerage houses and other custodians, nominees and fiduciaries to forward
Proxies and proxy material to their principals and may reimburse them for
their expenses in so doing. Certain officers and employees of the Company may
solicit Proxies by telephone, facsimile or personally from some shareholders
whose Proxies are not promptly received. Such officers and employees will
receive no compensation other than their regular salaries, but they will be
reimbursed for any expenses incurred in making such solicitation.
SUBMISSION OF SHAREHOLDER PROPOSALS
Any shareholder proposal to be presented at the 1997 annual meeting should
be directed to Randall W. White, President of the Company, at 10302 East 55th
Place, Suite B, Tulsa, Oklahoma 74146-6515, and must be received by the
president on or before March 3, 1997. Any such proposal must comply with the
requirements of Rule 14a-8 promulgated under the Securities Exchange Act of
1934, as amended.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The firm of Deloitte & Touche LLP audited the financial statements of the
Company for the fiscal year ended February 29, 1996. The firm of Deloitte &
Touche LLP has also been selected and approved by the Board of Directors as
independent public accountants and auditors to make an audit of the financial
statements of the Company for fiscal year ending February 28, 1997. A
representative of Deloitte & Touche LLP is expected to be present at the
meeting. Such representative will be afforded an opportunity to make a
statement on behalf of said firm and will be available to respond to
appropriate questions.
7
<PAGE>
ANNUAL REPORTS AND FINANCIAL STATEMENTS
The proxy statement is accompanied by the Annual Report of the Company for
its fiscal year ended February 29, 1996. Shareholders are referred to such
Report for information about the Company's business and activities, but such
Report is not incorporated in this Proxy Statement and is not deemed to be a
part of the proxy soliciting material.
COPIES OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO SECTION 13 OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED, WILL BE PROVIDED WITHOUT CHARGE TO RECORD OR
BENEFICIAL OWNERS OF SHARES ENTITLED TO VOTE AT THE MEETING. Written requests
for copies of said report should be directed to Randall W. White, President of
the Company, at the Company's corporate headquarters located at 10302 East
55th Place, Suite B, Tulsa, Oklahoma 74146-6515.
OTHER MATTERS
Management does not intend to present and does not have any reason to
believe that others will present at the annual meeting any item of business
other than as stated in the Notice of Annual Meeting of Shareholders. If,
however, other matters are properly brought before the meeting, it is the
intention of the persons named as proxies in the accompanying form of Proxy to
vote the shares represented thereby in accordance with their best judgment and
discretionary authority to do so is included in the Proxy.
By order of the Board of Directors
/s/ Randall W. White
Randall W. White
Chairman of the Board and President
Tulsa, Oklahoma
June 24, 1996
8
<PAGE>
- --------------------------------------------------------------------------------
EDUCATIONAL DEVELOPMENT CORPORATION
10302 East 55th Place, Suite B, Tulsa, Oklahoma 74146
PROXY
THIS PROXY IS BEING SOLICITED BY AND ON BEHALF OF THE BOARD OF DIRECTORS.
ANNUAL MEETING OF SHAREHOLDERS, JULY 25, 1996
The undersigned hereby appoints Randall W. White and W. Curtis Fossett, or
either or both of them, proxies of the undersigned, with full power of
substitution, to vote all shares of Educational Development Corporation ("EDC")
owned by or standing in the name of the undersigned, at the Annual Meeting of
Shareholders of EDC, to be held at the Sheraton Tulsa, 10918 East 41st Street,
Tulsa, Oklahoma, on July 25, 1996 at 2:00 o'clock P.M., local time, and at any
adjournments.
(Continued on reverse side)
- --------------------------------------------------------------------------------
<PAGE>
1. UPON THE ELECTION OF DIRECTORS: The nominees for Class I Directors are:
John M. Lare and James F. Lewis
FOR the listed WITHHOLD
nominees AUTHORITY
to vote for all
listed nominees
[ ] [ ]
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- --------------------------------------------------------------------------------
The foregoing is as set forth in the Notice of said meeting and in the
accompanying Proxy Statement, receipt of which are hereby acknowledged. THIS
PROXY WILL BE VOTED AS INDICATED BY THE SHAREHOLDER(S). IF NO CHOICE IS
INDICATED ON THE ABOVE PROPOSAL, THIS PROXY WILL BE VOTED FOR SUCH PROPOSAL.
The Board of Directors know of no other proposals to come before this meeting.
IF ANY OTHER MATTERS SHOULD BE BROUGHT BEFORE THE MEETING, THE PERSONS NAMED IN
THIS PROXY OR THEIR SUBSTITUTES WILL VOTE THIS PROXY ON SUCH MATTERS IN
ACCORDANCE WITH THEIR BEST JUDGEMENT.
The undersigned hereby revokes any
Proxy heretofore given,
and ratifies all that said Proxies
may lawfully do or cause to be
done by virtue hereof.
Dated:
________________________, 1996
_________________________ L.S.
_________________________ L.S.
IMPORTANT: Please sign exactly as
your name or names appear on this
Proxy and when signing as
attorney, executor, administrator,
trustee or guardian, give your
full title as such. If the
signatory is a corporation, sign
the full corporate name by duly
authorized officer. If a
partnership please sign in
partnership name by authorized
person(s).
PLEASE SIGN THIS SIDE
- --------------------------------------------
"PLEASE MARK INSIDE BLUE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES"
- --------------------------------------------
