<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 1, 1995
----------------
Nobel Education Dynamics, Inc.
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(Exact name of registrant as specified in its charter)
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<CAPTION>
<S> <C> <C>
Delaware 1-10031 22-2465204
- -------- ------- ----------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
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Rose Tree Corporate Park II, 1400 N. Providence Road, Suite 3055, Media, PA
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19063
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(Address of principal executive offices)
Registrant's telephone number, including area code (610)891-8200
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N/A
---
(Former name or former address, if changed since last report.)
Item 5 Other Events
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A. Shareholder letter and related quarterly financial statements are
being distributed to stockholders.
Item 7 Exhibits
- ------ --------
20. Shareholder letter and the related quarterly financial statements
dated November 1, 1995.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
Nobel Education Dynamics, Inc.
(Registrant)
Date: November 1, 1995 By:______________________________
Yvonne DeAngelo
Controller and Secretary
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Exhibit 20
[LOGO OF NOBEL EDUCATION DYNAMICS, INC. APPEARS HERE.]
November 1, 1995
DEAR SHAREHOLDER:
Nobel experienced a very good and eventful third quarter with record earnings,
two major acquisitions, a $23,000,000 recapitalization, a reverse stock split
and the opening of our first Chesterbrook Academy schools in the Midwest
(Champaign, Illinois) and East (Exton and Wayne, Pennsylvania; Voorhees, New
Jersey; Greensboro and Lewisville, North Carolina). As important as the
openings themselves is the acceptance of the concept that an educationally
advanced preschool at essentially the same price as basic child care is a
product of choice by knowing parents (see attached article from an Illinois
newspaper, Attachment 1).
Attachments 2 and 3 from USA Today and The Wall Street Journal respectively are
other indications that Nobel is in the right place at the right time. There is
significant demand from parents who want to be provided with a meaningful
alternative to the failing public school debacle, and we believe that
alternative is Nobel Education Dynamics.
Nobel also received recognition from Equities Magazine, Inc. (Attachment 4),
Ferris Baker Watts (Attachment 5) and The Education Industry Report (Attachment
6), as well as Forbes Magazine which was sent to you previously.
Nobel also participated in Alex Brown & Sons' annual education seminar. Jack
Clegg, Chairman of Nobel, participated on a panel with Apollo Group, Inc.,
Sylvan Learning Centers, Inc. and The Edison Project regarding the privatization
of education.
Nobel's financial results also reached record levels in the third quarter ending
September 30, 1995 as summarized in the table that follows:
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<CAPTION>
========================================================================
($000'S QUARTER ENDING QUARTER ENDING 1995 VERSUS
OMITTED) 9/30/95 9/30/94 1994
<S> <C> <C> <C>
________________________________________________________________________
Revenue $10,572 $7,721 +37%
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Pretax Profit 260 30 +770%
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Net income 171 12 +1325%
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*Fully Diluted $ 0.02 0 +$0.02
Earnings Per
Share
========================================================================
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*Shows effect of one-for-four reverse stock split. Fully diluted earnings
per share were based on 6,148,988 and 5,055,788 common share and share
equivalents for the three months ended September 30, 1995 and 1994
respectively.
Note that income for the third quarter of 1995 represented significant progress
in softening what is traditionally the Company's seasonal downturn which, in the
past, resulted in losses. Nobel's Merryhill Country Schools' income from school
operations increased 487% and represented the most significant seasonality
change.
For the nine months ending September 30, 1995, the year-to-date financial
results also represent record earnings as shown below:
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<CAPTION>
======================================================================
($000'S FOR THE NINE FOR THE NINE 1995 VERSUS
OMITTED) MONTHS ENDING MONTHS ENDING 1994
9/30/95 9/30/94
<S> <C> <C> <C>
- ----------------------------------------------------------------------
Revenue $30,766 $24,723 +24%
- ----------------------------------------------------------------------
Pretax Profit 1,686 1,301 +30%
- ----------------------------------------------------------------------
Net Income 3,239 1,757 +84%
- ----------------------------------------------------------------------
*Fully Diluted $ 0.54 $ 0.36 +$0.18
Earnings Per
Share
======================================================================
</TABLE>
*Shows effect of one-for-four reverse stock split. Fully diluted earnings
per share were based on 5,984,299 and 4,850,514 common share and share
equivalents for the nine months ended September 30, 1995 and 1994
respectively.
<PAGE>
Shareholders' equity increased $4,087,507 in the third quarter and $7,255,717
year to date, reaching $15,554,022 at September 30, 1995.
Both of Nobel's acquisitions in the third quarter represented significant events
plus opportunities for additional growth. The acquisition of Educo, Inc. added
ten eastern schools to the Nobel family. These schools are located in Maryland,
Virginia, South Carolina and North Carolina. The acquisition of the nine
Children Today centers expanded Nobel's core operations into an additional
state, Indiana, while strengthening our Midwest presence. Educo and Children
Today, acquired at the end of August 1995, represent approximately $760,000 in
combined additional revenue in their first month of operations and represent
approximately $9.4 million in revenues annualized as well as a capacity for
2,700 additional children.
The financial restructuring of Nobel in the third quarter furnished the Company
with a stronger financial foundation as well as resources for Nobel's future
growth. First Valley/United Jersey Bank provided $15,000,000 of senior debt
capital while Allied Capital provided $8,000,000 of equity and sub-debt. The
bank debt from CoreStates Bank and Foothill Capital was repaid. A portion of
the new capital was used to acquire the operations of Educo, Inc. and Children
Today. The remaining funds will furnish capital for Nobel's future growth.
Nobel Education Dynamics, Inc. is now a leading "education company" with
significant growth potential. Nobel provides an excellent education from
preschool through eighth grade at tuitions affordable to most middle income
families, while producing a profit. Managing each school as an efficient
business is Nobel's success formula.
Growth and geographic expansion will continue via newly built schools,
acquisitions and also by opening more previously closed, public schools as Nobel
schools, while rigidly maintaining the quality of educational programs provided.
Nobel's management believes that the Company is just beginning to take advantage
of its position in an expanding industry, and that Nobel's growth potential is
very significant.
Sincerely,
A. J. Clegg
Chairman
AJC:smw
Attachments
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NOBEL EDUCATION DYNAMICS, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
________________
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<CAPTION>
(Unaudited)
September 30, December 31,
1995 1994
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<S> <C> <C>
ASSETS
- ------
Cash and cash equivalents $ 3,711,215 $ 853,886
Accounts receivable, less allowance for
doubtful accounts of $96,282 in both
1995 and 1994 697,012 614,640
Notes receivable --- 45,114
Prepaid expenses and other assets 2,002,884 806,020
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Total Current Assets 6,411,111 2,319,660
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Property and equipment, at cost 21,402,908 13,398,969
Accumulated depreciation (4,976,561) (4,216,505)
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16,426,347 9,182,464
Property and equipment held for sale 1,297,775 1,266,648
Cost in excess of net assets acquired 17,660,188 8,887,995
Deposits and other assets 2,725,427 1,066,926
Deferred tax asset 2,616,200 510,300
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Total Assets $47,137,048 $ 23,233,993
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LIABILITIES AND SHAREHOLDERS' EQUITY
- -------------------------------------
Current portion of long-term obligations $ 1,633,145 1,767,756
Current portion of capital lease
obligations 47,935 57,194
Accounts payable and other current liabilities 8,295,097 4,594,768
Reserve for restructuring 100,000 96,900
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Total Current Liabilities 10,076,177 6,516,618
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Long-term obligations 11,830,267 7,846,151
Subordinated long-term debt 9,079,483
Capital lease obligations 336,386 371,543
Deferred gain on sale/leaseback 57,310 63,303
Minority interest in consolidated subsidiary 203,403 138,073
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Total Liabilities 31,583,026 14,935,688
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Shareholders' Equity:
Preferred stock, $.001 par value; 10,000,000 shares authorized,
1,063,830 issued in 1995, 2,500,000 issued in 1994
and 2,484,320 issued in 1993 5,505 4,984
Common stock, $.001 par value,
50,000,000 shares authorized, outstanding
4,087,774 shares in 1995 and 15,445,063 in 1994 4,088 15,445
Common stock issuable 313 ---
Additional paid-in capital 23,818,046 19,644,922
Accumulated deficit (8,273,930) (11,367,046)
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Total Shareholders' Equity 15,554,022 8,298,305
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Total Liabilities and Shareholders' Equity $47,137,048 $23,233,993
============ ============
</TABLE>
<PAGE>
NOBEL EDUCATION DYNAMICS, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
for the nine months ended September 30, 1995 and 1994
-----------------------------------------------------
(Unaudited)
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<CAPTION>
1995 1994
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<S> <C> <C>
Revenues $30,765,128 $24,722,906
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Operating Expenses 24,918,719 20,288,422
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School operating profit 5,846,409 4,434,484
General and administrative expenses 2,473,863 2,080,090
Litigation reserve 500,000 ---
Interest expense 1,213,746 945,792
Other income (92,038) 45,720
Minority interest in profit
of consolidated subsidiary 65,330 61,710
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Income before income taxes 1,685,508 1,301,172
Income tax (benefit) expense (1,614,900) (456,300)
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Net income before extraordinary
item $ 3,300,408 $ 1,757,472
Extraordinary item 62,000* ---
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Net income $ 3,238,408 $ 1,745,472
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Preferred stock dividends $ 145,288 $ 149,058
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Net income available to common
shareholders $ 3,093,120 $ 1,608,414
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Primary earnings per share
before extraordinary item $ 0.71 $ 0.40**
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Primary earnings per share $ 0.69 $ 0.40**
=========== =============
Fully diluted earnings per share
before extraordinary item $ 0.55 $ 0.36**
=========== =============
Fully diluted earnings per share $ 0.54 $ 0.36**
=========== =============
</TABLE>
*Write-off of unamortized loan origination fees relating to refinancing.
**Proforma for 1:4 stock split.
<PAGE>
NOBEL EDUCATION DYNAMICS, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
for the three months ended September 30, 1995 and 1994
------------------------------------------------------
(Unaudited)
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<CAPTION>
1995 1994
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<S> <C> <C>
Revenues $10,572,070 $7,721,008
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Operating Expenses 8,980,190 6,686,329
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School operating profit 1,591,880 1,034,679
General and administrative expenses 878,298 640,215
Interest expense 511,415 299,981
Other income (80,657) 46,306
Minority interest in profit
of consolidated subsidiary 22,501 18,362
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Income before income taxes 260,323 29,815
Income tax (benefit) expense 90,000 18,000
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Net income before extraordinary
item $ 170,323 $ 11,815
Extraordinary item 62,000* ---
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Net income $ 108,323 $ 11,815
=========== ==========
Preferred stock dividends $ 45,916 $ 49,686
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Net income available to common
shareholders $ 62,407 (37,871)
=========== ==========
Primary earnings per share
before extraordinary item $ 0.03 $ 0.00
=========== ==========
Primary earnings per share $ 0.01 $ 0.00
=========== ==========
Fully diluted earnings per share
before extraordinary item $ 0.03 $ 0.00
=========== ==========
Fully diluted earnings per share $ 0.02 $ 0.00
=========== ==========
</TABLE>
*Write-off of unamortized loan origination fees related to refinancing.
