NOBEL EDUCATION DYNAMICS INC, PRE 14A, 1996-04-26

NOBEL EDUCATION DYNAMICS INC
PRE 14A, 1996-04-26
CHILD DAY CARE SERVICES

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<PAGE>

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

Filed by Registrant / x /

Filed by a Party other than the Registrant / /

Check the appropriate box:
[ ] Confidential, For Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[x] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12

Nobel Education Dynamics, Inc.
(Name of Registrant As Specified in Charter)

(Name of Person(s) Filing the 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) or 14a-6(i)(2), or
Item 22(a) of Schedule 14A
[ ] $500 per each party to the controversy pursuant to Exchange Act Rules 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:
N/A

2) Aggregate number of securities to which transaction applies:
N/A

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):
N/A

4) Proposed maximum aggregate value of transaction:
N/A

5) Total fee paid:
N/A

[ ] 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:
N/A

2) Form, Schedule, or Registration Statement No.:
N/A

3) Filing party:
N/A

4) Date filed:
N/A
<PAGE>

PRELIMINARY COPY

NOBEL EDUCATION DYNAMICS, INC.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

JUNE 18, 1996

To the Stockholders:

The 1996 Annual Meeting of Stockholders of Nobel Education Dynamics, Inc.
will be held at 1:00 P.M. on June 18, 1996 at the Adam's Mark Hotel, City Avenue
and Monument Road, Philadelphia, Pennsylvania 19131 (telephone: (215) 581-5000)
for the following purposes:

1. To elect eight directors, three of whom shall serve for a one year term, two
of whom shall serve for a two year term and three of whom shall serve for a
three year term; provided that if Proposal 4 is not approved, all directors
will be elected for a one year term.

2. To ratify the selection of Coopers & Lybrand, L.L.P. as the Company's
independent auditors for fiscal year 1996.

3. To consider and vote on a proposal to approve the 1995 Stock Incentive Plan
for California residents. (STOCKHOLDERS SHOULD NOTE THAT SUCH PLAN WILL NOT
INCREASE THE TOTAL NUMBER OF SHARES OF COMMON STOCK AVAILABLE FOR GRANTS OF
INCENTIVE AWARDS, SINCE AWARDS GRANTED UNDER SUCH PLAN WILL REDUCE AWARDS
WHICH CAN BE GRANTED UNDER THE COMPANY'S 1995 STOCK INCENTIVE PLAN.)

4. To consider and vote on a proposal (a) to amend the Company's Amended and
Restated Certificate of Incorporation to provide (i) for the classification
of the Board of Directors into three classes of directors and (ii) that a
director may be removed only by the holders of a majority of the shares and
only for cause and (b) to amend the Company's Bylaws to make certain related
changes.

5. To consider and vote on a proposal to amend the Company's Amended and
Restated Certificate of Incorporation to add a new Article Eleventh to the
Certificate of Incorporation that would require that all stockholder action
be taken at a stockholders' meeting.

6. To consider and vote on a proposal to amend the Company's Amended and
Restated Certificate of Incorporation to add a new Article Twelfth to the
Certificate of Incorporation that would establish procedures with respect to
the nomination of persons for election as directors.
<PAGE>

7. To consider and vote on a proposal to amend the Company's Amended and
Restated Certificate of Incorporation to add a new Article Thirteenth to the
Certificate of Incorporation that would establish procedures with respect to
the making of substantive motions by stockholders at an annual or special
meeting of stockholders.

8. To consider and vote on a proposal to amend the Company's Amended and
Restated Certificate of Incorporation to add a new Article Fourteenth to the
Certificate of Incorporation that would require a two-thirds stockholder
vote to amend or repeal certain provisions of the Certificate of
Incorporation.

9. To transact such other business as may properly come before the Meeting or
any adjournment thereof.

Only stockholders of record at the close of business on May 3, 1996 will be
entitled to notice of, and to vote at, the Meeting and any adjournment or
adjournments thereof.

Information concerning the matters to be acted upon at the Meeting is set
forth in the accompanying Proxy Statement.

All stockholders are cordially invited to attend the Meeting in person.
HOWEVER, TO ASSURE YOUR REPRESENTATION AT THE MEETING, YOU ARE URGED TO MARK,
SIGN AND RETURN THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE IN THE POSTAGE-
PREPAID ENVELOPE ENCLOSED FOR THAT PURPOSE. Any stockholder attending the
Meeting may vote in person even if he or she returned a proxy.

Sincerely,

Yvonne DeAngelo
Vice President - Finance and
Administration and Secretary

Media, PA
May 7, 1996
<PAGE>

CONTENTS

<TABLE>
<S> <C>
Solicitation of Proxy, Revocability and Voting.......................................... 1

Security Ownership...................................................................... 3

Proposal 1: Election of Directors...................................................... 6

Proposal 2: Ratification of Appointment of Independent Accountants..................... 10

Proposal 3: 1995 Stock Incentive Plan for California Residents......................... 11

Introduction to Proposals 4, 5, 6, 7 and 8.............................................. 16

Proposal 4: Classification of the Board of Directors and Related Matters............... 19

Proposal 5: Proposed Amendment to Certificate of Incorporation
Establishing Requirement That Stockholder Action Be Taken at a Meeting................ 22

Proposal 6: Proposed Amendment to Certificate of Incorporation
Establishing Procedures for Nominating Directors...................................... 24

Proposal 7: Proposed Amendment to Certificate of Incorporation
Establishing Procedures for Presenting Proposals at an Annual
or Special Meeting of Stockholders.................................................... 26

Proposal 8: Proposed Amendment to Certificate of Incorporation
Adopting Requirement of a Supermajority Vote for Amendment
or Repeal of Certain Provisions of the Restated Certificate of Incorporation.......... 28

Executive Compensation.................................................................. 29

Stock Performance....................................................................... 35

Certain Transactions.................................................................... 37

Compliance with Section 16(a) of the Securities Exchange Act Of 1934.................... 37

Certain Relationships and Related Transactions.......................................... 37

General Information..................................................................... 38

Deadline for Receipt of Stockholder Proposals........................................... 38
</TABLE>
<PAGE>

NOBEL EDUCATION DYNAMICS, INC.

PROXY STATEMENT

SOLICITATION OF PROXY, REVOCABILITY AND VOTING

GENERAL

The enclosed proxy is solicited on behalf of the Board of Directors of Nobel
Education Dynamics, Inc., a Delaware corporation (the "Company"), for use at the
1996 Annual Meeting of Stockholders (the "Meeting") to be held on June 18, 1996.
Only stockholders of record on May 3, 1996 will be entitled to notice of, and to
vote at, the Meeting. Each share of common stock ("Common Stock") outstanding on
the record date is entitled to one vote on each matter to be considered; and
each share of preferred stock ("Preferred Stock") is entitled to the number of
votes on each matter to be considered equal to the number of full shares of
Common Stock into which such share of Preferred Stock is convertible (calculated
by rounding any fractional share down to the nearest whole number). As of the
record date of the meeting, each share of Series A Preferred Stock, Series C
Preferred Stock and Series D Preferred Stock was convertible into .2940, 0.25
and 0.25 shares of Common Stock, respectively. On May 3, 1996, the Company had
5,697,390 shares of Common Stock, 1,282,802 shares of Series A Preferred Stock,
2,500,000 shares of Series C Preferred Stock and 1,063,830 shares of Series D
Preferred Stock issued and outstanding.

The Company's principal executive offices are located at Rose Tree Corporate
Center II, 1400 North Providence Road, Suite 3055, Media, Pennsylvania 19063.
The approximate date on which this Proxy Statement and the accompanying proxy
are first being sent to stockholders is May 7, 1996.

QUORUM AND VOTING

The presence at the Meeting, in person or by proxy, of the holders of shares
representing a majority of the votes represented by the Common Stock and
Preferred Stock is necessary to constitute a quorum for the transaction of
business. The holders of the Common Stock and the Preferred Stock vote
together, and not as a separate class, on all matters to be submitted to
stockholders at the Meeting. The election of directors will be determined by a
plurality vote and the eight nominees receiving the most "FOR" votes will be
elected. Approval of the proposals to ratify the selection of auditors and of
the 1995 Stock Incentive Plan for California Residents will require the
affirmative vote of the holders of a majority of the votes represented by the
shares of the Company's Common Stock and Preferred Stock present at the Meeting
in person or by proxy and entitled to vote. The affirmative vote of at least a
majority of the votes represented by the outstanding shares of the Company's
Common Stock and Preferred Stock will be required to approve the amendments to
the certificate of incorporation to classify the board of directors, to
establish the requirement that stockholder action be taken only at a
stockholders' meeting, to establish procedures for nominating directors, to
establish procedures for presenting proposals at an annual or special meeting of
stockholders and to require a supermajority vote for amendment or repeal of
certain provisions of the restated certificate of incorporation. In the
election of directors, an abstention or broker non-vote will not be counted as a
vote cast and will have no effect
<PAGE>

on the outcome of the election. On all other proposals, abstentions will have
the effect of a vote against the proposal. Broker non-votes will have no effect
on the outcome of the proposals to ratify the selection of auditors and to
approve the 1995 Stock Incentive Plan for California residents, but will have
the effect of a vote against all other proposals.

REVOCABILITY OF PROXIES

Any person giving a proxy in the form accompanying this proxy statement has
the power to revoke it at any time before its exercise. It may be revoked by
filing with the Secretary of the Company or by the presentation at the Meeting
of an instrument of revocation or a duly executed proxy bearing a later date.
It also may be revoked by attendance at the Meeting and the casting of a written
ballot in person. Unless so revoked, the shares represented by proxies will be
voted at the Meeting in accordance with instructions or, as to any matter as to
which no instructions are given, for the election of the proposed nominees and
in favor of Proposals 2 through 8.

SOLICITATION

The Company will bear the entire cost of preparing, assembling, printing and
mailing this proxy statement, the accompanying proxy, and any additional
material which may be furnished to stockholders. Copies of solicitation
material will be furnished to brokerage houses, fiduciaries and custodians to
forward to beneficial owners of stock held in their names. The solicitation of
proxies will be made by the use of the mails and through direct communication
with certain stockholders or their representatives by officers, directors and
employees of the Company, who will receive no additional compensation therefor.
The Company has engaged Stocktrans, Inc., the transfer agent for the Company's
Common Stock and Preferred Stock, to solicit proxies and distribute materials to
brokerage houses, banks, custodians and other nominee holders. The Company will
pay Stocktrans approximately $4,000 for these services.

2
<PAGE>

SECURITY OWNERSHIP

Common Stock

The following table shows information concerning the beneficial ownership of
the Company's Common Stock as of March 31, 1996 by each director and nominee, by
each executive officer named in the Summary Compensation Table appearing
elsewhere in this Proxy Statement and employed by the Company as of March 31,
1996, by all directors, nominees and executive officers as a group, and by each
person who is known to the Company to be the beneficial owner of more than 5% of
the Company's Common Stock. The number of shares beneficially owned by each
person is determined under the rules of the Securities and Exchange Commission
and the information is not necessarily indicative of beneficial ownership for
any other purpose. Under such rules, beneficial ownership includes any shares as
to which the person has sole or shared voting power or investment power and also
any shares which the person has the right to acquire within 60 days of March 31,
1996 through the exercise of any stock option or right or conversion of any
convertible security or otherwise. As of March 31, 1996, the Edison Venture Fund
II, L.P., Allied Capital Corporation and affiliated funds, and A. J. Clegg were
the only persons or group of persons known to the Company as beneficially owning
more than 5% of the outstanding Common Stock of the Company. The Edison Venture
Fund II, L.P. has its principal executive office at 997 Lenox Drive #3,
Lawrenceville, New Jersey 08648. Allied Capital Corporation and affiliated funds
has their principal executive offices at 1666 K St., N.W., Suite 901,
Washington, DC 20006. A. J. Clegg's address is c/o Nobel Education Dynamics,
Inc., Rose Tree Corporate Center II, 1400 North Providence Road, Suite 3055,
Media, Pennsylvania 19063.

<TABLE>
<CAPTION>
Number of Shares of
Common Stock Percent of
Name of Beneficial Owner Beneficially Owned Class (1)
------------------------ ------------------ ---------
<S> <C> <C>
A. J. Clegg 554,352 (2) 9.02%
Edward H. Chambers 22,730 (3) *
John Frock 52,200 (4) *
Peter H. Havens 12,609 (5) *
Morgan R. Jones 8,100 (6) *
Janet Katz 29,900 (7) *
John Martinson 629,532 (8) 9.95%
Eugene Monaco 1,000 *
D. Scott Clegg 6,250 (9) *
Edison Venture Fund II, L.P. 629,032 (10) 9.94%
Allied Capital Corporation 575,000 (11) 9.17%
All directors and executive 1,318,048 (12) 19.10%
officers as a group
(11 persons)
</TABLE>

* Less than 1%. [See notes on following page]

3
<PAGE>

(1) The numbers set forth above reflect the percentage of outstanding Common
Stock currently owned by each holder listed and the percentage of
outstanding Common Stock which would be owned by each such holder giving
effect to the conversion of all shares of Preferred Stock and exercise of
all options held by such holder, but not to such conversion or exercise by
any other person.

(2) Of these shares, 100,806 shares are issuable upon conversion of Series C
Preferred Stock of the Company and 20,161 shares are issuable upon the
exercise of warrants owned by Mr. Clegg. In addition, Mr. Clegg is also the
beneficial owner of an additional 430,885 shares owned of record by, or
issuable upon the exercise of securities of the Company owned of record by,
JBS Investment Banking, Ltd., a privately held corporation of which Mr.
Clegg is a director, officer and controlling stockholder, as follows:
103,000 shares of Common Stock owned of record by JBS; 187,500 shares
issuable upon the exercise of warrants held by JBS; and 140,385 shares of
Common Stock issuable upon the conversion of the Company's Series A
Preferred Stock owned of record by JBS. JBS may also be deemed to be the
beneficial owner of these 430,885 shares. Mr. Clegg is also the beneficial
owner of 2,500 shares of Common Stock owned by his spouse. This does not
include shares beneficially owned by Mr. Clegg's adult children (including
Scott Clegg, an officer of the Company), as to which he disclaims
beneficial ownership.

(3) Consists of 19,750 shares of Common Stock which Mr. Chambers has the right
to purchase upon the exercise of currently exercisable options, 1,470
shares of Common Stock issuable upon the conversion of the Company's Series
A Preferred Stock, and 1,510 shares of Common Stock held by Mr. Chambers.

(4) Consists of 14,700 shares of Common Stock issuable upon the conversion of
the Company's Series A Preferred Stock, 12,500 shares of Common Stock held
by Mr. Frock and 25,000 shares of Common Stock to be issued to Mr. Frock
pursuant to the terms of a restricted stock award under the 1995 Stock
Incentive Plan (ownership of which is subject to a three-year vesting
schedule).

(5) Consists of 7,250 shares of Common Stock which Mr. Havens has the right to
purchase upon the exercise of currently exercisable options, 3,234 shares
of Common Stock issuable upon the conversion of the Company's Series A
Preferred Stock, and 2,125 shares of Common Stock held by Mr. Havens.

(6) Consists of 7,600 shares of Common Stock held by Mr. Jones and 500 shares
of Common Stock which Mr. Jones has the right to purchase upon the exercise
of currently exercisable options. Does not include 1,750 shares owned by
Mr. Jones's spouse and 2,650 shares owned by Mr. Jones's adult children as
to which he disclaims beneficial ownership.

(7) Consists of 29,400 shares of Common Stock issuable upon the conversion of
the Company's Series A Preferred Stock held by Ms. Katz and 500 shares of
Common Stock which Ms. Katz has the right to purchase upon the exercise of
currently exercisable options.

(8) Mr. Martinson is a managing partner of Edison Partners II, the general
partner of Edison Venture Fund II, L.P.. By virtue of his position as
managing partner, Mr. Martinson may under the SEC's rules also be deemed a
beneficial owner of the shares owned by Edison Venture Fund II, L.P. (See
footnote 10.) Mr. Martinson disclaims beneficial ownership of such shares.
Mr. Martinson also holds currently exercisable options to purchase 500
shares of Common Stock.

(9) Consists of 6,250 shares of Common Stock which Mr. Clegg has the right to
purchase upon the exercise of currently exercisable options.

(10) Consists of 524,193 shares of Common Stock issuable upon the conversion of
the Company's Series C Preferred Stock held by the Edison Venture Fund II,
L.P. and 104,839 shares issuable upon the exercise of warrants held by the
Edison Venture Fund II, L.P. By virtue of his position as managing partner
of Edison Venture Fund II, L.P., Mr. Martinson may under the SEC's rules
also be deemed a beneficial owner of these shares.

(11) Consists of an aggregate of 265,958 shares of Common Stock upon the
conversion of the Company's Series C Preferred Stock and 309,043 issuable
upon the exercise of warrants held by Allied Capital Corporation, Allied
Capital Corporation II, Allied Investment Corporation and Allied Investment
Corporation II.

(12) Consists of shares beneficially held by all natural persons in this table,
and an additional 1,125 shares of Common Stock which an executive officer
not named in the table has the right to purchase upon the exercise of
currently exercisable options and 250 shares owned by such executive
officer.

4
<PAGE>

Preferred Stock

The following table shows information concerning the beneficial ownership of
the Company's Series A Preferred Stock, Series C Preferred Stock and Series D
Preferred Stock as of March 31, 1996 by each director and nominee, by each
executive officer named in the Summary Compensation Table appearing elsewhere in
this Proxy Statement and employed by the Company as of March 31, 1996, and by
all directors, nominees and executive officers as a group. Directors, nominees
and executive officers omitted from a section of the following table do not
beneficially own shares of the series of Preferred Stock to which such section
relates.

<TABLE>
<CAPTION>
Number of Shares of
Name of Preferred Stock Percent of
Security Name of Beneficial Owner Beneficially Owned Class
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Series A Edward H. Chambers 5,000 0.35%
Preferred A. J. Clegg 477,500 (1) 33.10%
Stock John Frock 50,000 3.47%
Peter H. Havens 11,000 0.76%
Janet Katz 100,000 6.93%
All directors and executive 643,500 44.61%
officers as a group
(11 persons)
--------------------------------------------------------------------------------
Series C A. J. Clegg 403,226 16.13%
Preferred Edison Venture Fund II, L.P. 2,096,774 83.87%
Stock John Martinson 2,096,774 (2) 83.87%
All directors and executive 403,226 16.13%
officers as a group
(11 persons)
--------------------------------------------------------------------------------
Series D Allied Capital Corporation 1,063,830 (3) 100.00%
Preferred
Stock All directors and executive 0
officers as a group
(11 persons)
--------------------------------------------------------------------------------
</TABLE>

(1) Mr. Clegg is the beneficial owner of these 477,500 shares of Series A
Preferred Stock owned of record by JBS Investment Banking, Ltd., as he is a
director, officer and controlling stockholder of JBS Investment Banking,
Ltd.

(2) John Martinson is a managing partner of Edison Partners II, the general
partner of Edison Venture Fund II, L.P. By virtue of his position as
managing partner, Mr. Martinson may also under the SEC's rules be deemed a
beneficial owner of the 2,096,774 shares of Series C Preferred Stock owned
by Edison Venture Fund II, L.P. Mr. Martinson disclaims beneficial
ownership of such shares.

(3) Shares are owned by Allied Capital Corporation, Allied Capital Corporation
II, Allied Investment Corporation and Allied Investment Corporation II.

5
<PAGE>

PROPOSAL 1

ELECTION OF DIRECTORS

(Item 1 on Proxy Card)

NOMINEES

At the Meeting, eight directors, constituting the entire Board of Directors of
the Company, are to are to be elected. If Proposal 4, which would classify the
Board of Directors into three classes each ultimately serving three year terms,
is adopted, eight directors will be elected for the terms set forth in the table
below. If Proposal 4 is not adopted, each of the eight directors will be
elected to hold office until the 1997 Annual Meeting of Stockholders and until
his or her successor has been duly elected and qualified. Each nominee is
currently a director. In either case, directors will be elected by a plurality
of the shares present and voting at the meeting. If so authorized, the persons
named in the accompanying proxy card intend to vote for the election of each
nominee. Stockholders who do not wish their shares to be voted for a particular
nominee may so indicate in the space provided on the proxy card. If any of the
nominees are not available to serve at the time of the Meeting, the persons
named in the proxies may vote the proxies for such other persons as they may
choose unless the Board of Directors reduces the number of directors to be
elected.

The names of the nominees, and certain information about them, are set forth
below:

<TABLE>
<CAPTION>
Director
Name of Nominee Age Principal Occupation Since
- -------------------------------------------------------------------------------------------------
Directors to be elected to serve until the 1997 Annual Meeting:
<S> <C> <C> <C> <C>
John R. Frock 52 Executive Vice President of the Company 1992

Janet L. Katz 49 Curriculum Coordinator of Upper Saddle 1994
River Schools and Building Administrator
of Bogart School

Eugene E. Monaco 68 Judge, Delaware County Court (retired) 1995

Directors to be elected to serve until the 1998 Annual Meeting:

Morgan R. Jones 56 Partner and Chairman of Drinker 1991
Biddle & Reath

John H. Martinson 46 Managing Partner of Edison Venture Fund 1994

Directors to be elected to serve until the 1999 Annual Meeting:

Edward Chambers 59 Executive Vice President-Finance and 1988
Administration of Wawa, Inc.

A. J. Clegg 56 Chairman of Board of Directors, President 1992
and Chief Executive Officer of the Company

Peter H. Havens 41 Executive Vice President of Bryn Mawr 1991
Bank Corporation
</TABLE>

6
<PAGE>

The following description contains certain information concerning the
nominees, including current positions and principal occupations during the past
five years.

Edward H. Chambers. Mr. Chambers has served as Executive Vice President-Finance
and Administration of Wawa, Inc. since March 1988. During the period April 1984
through March 1988, he served as President and Chief Executive Officer, and as a
director, of Northern Lites, Ltd., an owner and operator of quick-service
restaurants operating pursuant to a franchise from D'Lites of America, Inc.
From 1982 to July 1984, Mr. Chambers was President-Retail Operations of Kentucky
Fried Chicken Corp., a franchiser of quick-service restaurants. He is a
director of Davco Restaurants, a franchisee of Wendy's International, Inc. and a
director of Riddle Memorial Hospital.

A.J. Clegg. Mr. Clegg was named Chairman of the Board and Chief Executive
Officer of the Company on May 29, 1992. Since 1989, Mr. Clegg has also served
on the Advisory Board of Drexel University. Since June 1990, Mr. Clegg has also
served as the Chairman and CEO of JBS Investment Banking, Ltd., which provides
investment management and consulting services to businesses and formerly
provided services to the Company through an Administrative Services Agreement.
Mr. Clegg's responsibilities for JBS Investment Banking, Ltd. do not require
material amounts of his time. In 1979, he formed Empery Corporation, an
operator of businesses in the cable and printing industries, and held the
offices of Chairman, President and CEO during his tenure (1979-1993). In
addition, Mr. Clegg served as Chairman and CEO of TVC, Inc. (1983-1993), a
distributor of cable television components; and Design Mark Industries (1988-
1993), a manufacturer of electronic senswitches. Mr. Clegg has also served on
the board of directors of Ferguson International Holdings, PLC, a United Kingdom
company, from March 1990 to April 1991; and was Chairman and CEO of Globe Ticket
and Label Company from December 1984 to February 1991.

John R. Frock. Mr. Frock was named Executive Vice President on August 1, 1994.
Mr. Frock was elected to the Board of Directors of the Company on May 29, 1992.
In March 1992, Mr. Frock became the President and Chief Operating Officer of JBS
Investment Banking, Ltd., which provides investment management and consulting
services to businesses and formerly provided services to the Company through an
Administrative Services Agreement. He is currently the Chairman and CEO of
Avant Garde Enterprises Ltd. Mr. Frock's responsibilities for companies other
than the Company do not require material amounts of his time. During the past
five years, Mr. Frock has also served as the President and COO of SBF
Communications Graphics, a business forms printer located in Philadelphia, PA;
President of Globe Ticket and Label Company, and President of the Graphics Group
of Empery Corporation.

Peter H. Havens. Mr. Havens has been Executive Vice President of Bryn Mawr Bank
Corporation since May 1995 overseeing the Trust Division. From 1982 through May
1995, Mr. Havens served as manager of Kewanee Enterprises, a private investment
firm located in Bryn Mawr, Pennsylvania. He is also a director of the Presidio
Oil Company, Bryn Mawr Bank Corporation, Petroferm, Inc., Ursinus College and
Independence Seaport Museum.

Morgan R. Jones. Mr. Jones has been a partner in the law firm Drinker Biddle &
Reath, Philadelphia, Pennsylvania since 1970, and is presently Chairman of the
firm. Mr. Jones also serves on the Board of Directors of Mack Printing
Companies, Inc.

7
<PAGE>

Janet Lea Katz. Ms. Katz has both a Masters and a Doctorate in Education from
Columbia University and is currently serving as the building administrator at
Bogart School in Upper Saddle River, New Jersey. Ms. Katz has held various
positions throughout her career in education, including speech arts teacher,
coordinator and therapist for speech and language programs for elementary school
and research assistant for the study of learning disabilities at Columbia
University, and is presently the curriculum coordinator for Upper Saddle River
Schools, Upper Saddle River, New Jersey.

John Martinson. Mr. Martinson is Managing Partner of Edison Venture Fund which
he founded in 1986. He serves on the Board of Directors of the National Venture
Capital Association, Dendrite International, Inc., SubMicron Systems, Inc. and
eleven private companies.

Eugene E. Monaco. Mr. Monaco has both a J.D. from Temple Law School and M.S. in
Mechanical Engineering from the University of Delaware and, from January 1, 1990
until his retirement in late 1995, served as a Judge for the Delaware County
District Court. He also served as an Instructor in Kinematics and Dynamics at
Drexel University, a Lecturer in child abuse at Penn State University, and was
the Chief Negotiator for the Rose Tree Media School Board. He also served as
Assistant District Attorney in Media, Pennsylvania and Engineering Negotiator
for Westinghouse Electric for 32 years.

Mr. John Martinson serves on the Board as the designee of Edison Venture Fund
II, L.P., the majority holder of the Series C Convertible Preferred Stock, which
was issued in August 1994.

Mr. A. J. Clegg's son, D. Scott Clegg, is the Vice President - Operations of
the Company.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES LISTED ABOVE.

MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES

The Board of Directors of the Company held a total of eight meetings during
the fiscal year ended December 31, 1995. In addition, the Board of Directors
adopted resolutions by unanimous consent four times during the 1995 fiscal year.
Each member of the Board of Directors attended at least 75% of the meetings of
the Board and Board Committees of which he was a member during 1995.

The Board of Directors has an Audit Committee, a Compensation Committee and a
Nominating Committee.

The Audit Committee of the Board of Directors presently consists of Mr.
Chambers (Chairman) and Mr. Havens. It held two meetings during 1995. The
Audit Committee recommends the engagement of the Company's independent
accountants and is primarily responsible for approving the services performed by
the Company's independent accountants and for reviewing and evaluating the
Company's accounting principles and its system of internal accounting controls.

The Compensation Committee of the Board of Directors presently consists of Mr.
Chambers (Chairman), Mr. Havens and Mr. Monaco. The Committee reviews and
recommends compensation and compensation changes for executives of the Company
and the Board of Directors and administers the Company's stock option and stock
grant plans. The Committee met _____ times during 1995.

8
<PAGE>

The Nominating Committee of the Board of Directors presently consists of Mr.
Jones (Chairman), Mr. Clegg and Mr. Martinson. The Committee recommends to the
Board a slate of director candidates for possible election by the stockholders.
The Nominating Committee met ____ times in 1995. Stockholders who wish to
suggest qualified candidates to the Nominating Committee should write to the
Secretary of the Company, Nobel Education Dynamics, Inc., Rose Tree Corporate
Center II, 1400 North Providence Road, Suite 3055, Media, Pennsylvania 19063,
stating in detail the candidate's qualifications for consideration by the
Committee.

The Company has no other committees of the Board of Directors.

COMPENSATION OF DIRECTORS

In June 1992, the Company adopted a policy to pay the directors (other than A.
J. Clegg) an annual retainer of $6,000 which will be paid quarterly; and, in
addition, to pay members of committees of the Board (other than A. J. Clegg)
$750 per meeting for each committee meeting attended. For the year ended
December 31, 1995, the Company paid $6,000 each to Messrs. Chambers, Frock,
Martinson, Havens and Jones, $4,500 to Ms. Katz, $3,000 each to Messrs. Monaco
and William Moore (a former director), and $1,500 to Kevin McGovern (a former
director), totaling $42,000. Mr. Clegg received no directors' fees.

The Company's 1995 Stock Incentive Plan provides that as of March 31, 1996 and
each subsequent March 31 that the Plan is in effect, each individual serving as
a director of the Company, who is not an officer or employee thereof, will be
granted a nonqualified stock option to purchase 500 shares of Common Stock if
the individual served as a director for the entire previous fiscal year and the
Company's pre-tax income for such fiscal year increased at least 20% from the
prior fiscal year. Pursuant to the Plan, on March 31, 1996, each of Messrs.
Chambers, Havens, Jones, Martinson and Ms. Katz received an option to purchase
500 shares of Common Stock.

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PROPOSAL 2

RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS

(Item 2 on Proxy Card)

The Board of Directors has selected Coopers & Lybrand, L.L.P., independent
accountants, to audit the consolidated financial statements of the Company for
its 1996 fiscal year and recommends that the stockholders vote for ratification
of such appointment. If the stockholders do not ratify this appointment, the
Board of Directors will reconsider its selection. A representative of Coopers &
Lybrand, L.L.P. is expected to be present at the Annual Meeting and will have
the opportunity to make a statement if desired and is expected to be available
to respond to appropriate questions.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 2.

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PROPOSAL 3

1995 STOCK INCENTIVE PLAN FOR CALIFORNIA RESIDENTS

(Item 3 on Proxy Card)

On December 13, 1995, the Company's Board of Directors (the "Board") adopted,
subject to stockholder approval, the Nobel Education Dynamics, Inc. 1995 Stock
Incentive Plan for California Residents (the "California Plan") to assist the
Company and any subsidiary of the Company ("Subsidiary") in attracting and
retaining officers and other key management level employees of outstanding
ability who are residents of California ("California Key Employees," as defined
in the Plan) and motivating California Key Employees to exercise their best
efforts on behalf of the Company and any Subsidiary. (The California Plan will
NOT increase the total number of shares of Common Stock available for grants of
incentive awards, since awards granted under the California Plan will reduce
awards which may be granted under the Company's 1995 Stock Incentive Plan.)

The following description of the California Plan is intended merely as a
summary of its principal features and is qualified in its entirety by reference
to the California Plan.

Under the California Plan, 375,000 shares of Common Stock are reserved
(subject to adjustment to reflect stock dividends, stock splits, share
combinations, and similar changes in the capitalization of the Company) for the
granting of incentive stock options ("ISOs"), non-qualified stock options
("NQSOs"), stock appreciation rights ("SARs") and restricted stock ("Restricted
Stock") (collectively, the "Awards").

The Company's 1995 Stock Incentive Plan (the "Current 1995 Plan") has been
amended so that the number of shares of Common Stock of the Company that may be
subject to awards under the Current 1995 Plan will be reduced by the number of
shares of Common Stock subject to Awards made under the California Plan (except
to the extent that, pursuant to the terms of the California Plan, any such
shares of Common Stock become available for granting of new Awards under the
California Plan following termination or expiration of ISOs or NQSOs or
forfeiture of Restricted Stock, until new Awards are made). ACCORDINGLY,
APPROVAL OF THE CALIFORNIA PLAN WILL NOT AFFECT THE TOTAL NUMBER OF SHARES OF
COMMON STOCK AVAILABLE FOR AWARDS, BUT WILL PERMIT RESIDENTS OF THE STATE OF
CALIFORNIA ALSO TO RECEIVE AWARDS.

Certain provisions of the Current 1995 Plan prevent the Company from
qualifying the Current 1995 Plan under securities laws of the State of
California. The California Plan was adopted in order to afford the Company a
stock incentive plan under which grants could be made to employees who are
residents of the State of California. The California Plan contains
substantially the same provisions as the Current 1995 Plan, except for certain
changes intended to comply with certain requirements of the State of California
(and for exclusion of provisions relating to nondiscretionery grants of stock
options to nonemployee directors). The Company has applied for its shares of
Common Stock to be traded under the NASDAQ National Market System. If the
Company's application is accepted, shares of the Company's Common Stock would be
exempt from the qualification requirements of California securities laws. In
such event, the Board of Directors of the Company reserves the right to
terminate the California Plan and rescind the amendments to the Current 1995
Plan discussed above (but shall not be obligated to do so).

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As of the date of this proxy statement, no Awards have been made under the
California Plan. There are approximately ___ California Key Employees eligible
to participate in the Plan. California Key Employees are eligible to receive
any type of Award. No California Key Employee shall receive ISOs and NQSOs
(collectively, "Options") for more than 25,000 shares of Common Stock over any
one-year period.

The Plan will be administered by the Compensation Committee, which is
presently comprised of Mr. Chambers (Chairman), Mr. Havens and Mr. Monaco. The
Committee has full authority to interpret the Plan, to establish appropriate
rules and regulations, to select California Key Employees who will receive
Awards under the Plan, to grant Awards on behalf of the Company, to set the
dates and authorized terms of such Awards, and generally to administer the Plan.

Options granted under the Plan to California Key Employees shall have an
exercise price of not less than fair market value of the Common Stock on the
date of the grant and may not extend for more than ten years, subject to more
stringent limitations applicable to an optionee who is a 10% or greater
stockholder. Options granted to California Key Employees are exercisable in
such installments as the Committee may determine, but not earlier than six
months from the later of the date of the grant or the date the Plan is approved
by the Company's stockholders, except under specified circumstances. On April
__, 1996, the last reported sales price of the Company's Common Stock on The
Nasdaq Small Cap Market System was $__________.

Any Option held by a California Key Employee who dies while still performing
services for the Company or a Subsidiary, or whose employment with the Company
or a Subsidiary is terminated prior to the expiration date of such Option, will
remain exercisable by the California Key Employee, or his or her personal
representative, for a period of time following the California Key Employee's
termination of service or death as provided in the Plan and the applicable
option agreement. Upon exercise of an Option, a California Key Employee must
pay the exercise price in cash, or, if the Committee shall so determine in its
discretion, either in whole or in part by the delivery of Common Stock held by
the California Key Employee, subject to the limitations set forth in the Plan.

ISOs are also subject to certain additional terms and conditions required by
the Internal Revenue Code of 1986, as amended (the "Code"). To the extent that
the fair market value (determined as of the date of the option grant) of the
Common Stock with respect to which ISOs are exercisable for the first time in
any one year as to any optionee exceeds $100,000, such option shall be treated
as a NQSO for tax purposes.

In the Committee's discretion, a California Key Employee granted an Option may
also be granted the right in lieu of exercising all or a portion of an Option,
to elect instead to receive an amount equal to the difference between the fair
market value of all, or a specified number, of the shares of Common Stock
subject to such Option on the date such right is exercised and the exercise
price under such Option. Such right is referred to as a Stock Appreciation
Right ("SAR"). This amount may be paid in cash or in Common Stock, or in a
combination of cash and Common Stock as the Committee shall determine. Any SAR
is exercisable only at a time when the Option to which it is related is
exercisable (more stringent rules apply if the California Key Employee is a
director or officer of the Company within the meaning of Section 16 of the
Exchange Act and cash is being paid upon exercise of the SAR). An SAR shall be
granted in tandem with an Option and the Option-SAR shall be considered

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<PAGE>

exercised when either the underlying Option or SAR is exercised. An SAR expires
no later than the termination of the Option to which it relates and is
transferable only if and when the underlying Option is transferable, and may be
exercised only when the fair market value of the Common Stock subject to the
Option exceeds the exercise price of the Option.

The Committee, in its discretion, may make such Restricted Stock Awards under
the Plan to California Key Employees as it determines are warranted. Restricted
Stock Awards may be subject to one or more vesting periods and any additional
terms, conditions or restrictions as the Committee may deem advisable. If the
Company issues certificates representing the Common Stock subject to the
Restricted Stock Award in the name of the California Key Employee, such Common
Stock will bear a legend indicating their restrictions and the California Key
Employee shall execute a stock power to be held with the certificates by the
Company. However, the California Key Employee shall be entitled to receive
dividends paid on such Common Stock, shall have the right to vote such Common
Stock, and shall have all other stockholders' rights with respect to such Common
Stock. The Committee shall specify in the Restricted Stock Award agreement the
manner of determining the number of unvested shares of Common Stock which shall
become vested in the California Key Employee if his or her employment is
terminated prior to the later of the expiration of the vesting period or the
satisfaction of any conditions. Different vesting provisions may apply to a
California Key Employee's termination due to death or disability. Any remaining
unvested shares of Common Stock shall be forfeited upon termination of
employment unless the Committee determines otherwise.

In connection with the grant of each Restricted Stock Award, the Committee
shall establish the purchase price for the Common Shares subject to such
Restricted Stock Award. Such purchase price shall equal at least 85% of the
fair market value of the Common Stock, determined as of the date the Restricted
Stock Award is granted or at the time the purchase is consummated, except that
if the Award is to a California Key Employee who owns more than 10% of the total
combined voting power or value of all shares of stock of the Company or of a
subsidiary or parent at the time the Award is granted to such California Key
Employee, the purchase price for the Restricted Stock shall be not less than
100% of the fair market value of the Common Stock, determined as of the date the
Restricted Stock Award is granted or at the time the purchase is consummated.

In the event of certain corporate reorganizations, each outstanding Award will
be assumed by the surviving or successor corporation. However, the Committee
may terminate all or a portion of the outstanding Options granted to California
Key Employees if it determines that such termination is in the best interests of
the Company, in which case the California Key Employee will be given not less
than seven days' notice prior to termination and the Options may be exercised up
to and including the date immediately preceding such termination.

The Plan became effective (subject to stockholder approval) on December 13,
1995, and terminates on December 13, 2005. The Board of Directors of the
Company may amend, suspend or discontinue the Plan, except that without the
approval of the stockholders: (1) the class of persons eligible to receive
Awards shall not be changed nor shall any other requirement as to eligibility
for participation in the Plan be materially modified; (2) the maximum number of
shares of Common Stock with respect to which Awards may be granted under the
Plan shall not be increased (otherwise than in connection with certain changes
in the capitalization of the Company); (3) the benefits accruing

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<PAGE>

to individuals participating in the Plan shall not be materially increased; (4)
the duration of the Plan shall not be extended; and (5) no amendment which would
require stockholder approval pursuant to Prop. Treas Reg. (S) 1.162-
27(e)(4)(vi), or any successor thereto, may be made.

TAX TREATMENT

If an option is treated as an ISO, the optionee will recognize no U.S. Federal
taxable income upon grant of the ISO. Upon the exercise of an ISO, the optionee
recognizes no taxable income provided the optionee was an employee of the
Company during the entire period from the date of the grant of the ISO until
three months before the date of exercise (or such later date as the option may
provide) or in the case of an optionee whose employment terminates due to
disability, until twelve months before the date of exercise. Notwithstanding
the preceding, the excess of the fair market value of the Common Stock over the
exercise price, both determined at the time of exercise, generally will be
included in the optionee's alternative minimum taxable income in the year of
exercise.

Upon an optionee's sale of the Common Stock (assuming that the sale occurs no
sooner than two years after grant of the ISO and one year after exercise of the
ISO), any gain will be taxed to the optionee as long-term capital gain. If the
optionee disposes of the shares of Common Stock prior to the expiration of the
above holding period, the optionee will recognize ordinary income in an amount
generally measured as the difference between the exercise price and the lower of
the fair market value of the Common Stock at the exercise date or the sale price
of the Common Stock. Any gain or loss recognized on such a disposition of the
Common Stock in excess of the amount treated as ordinary income will be
characterized as capital gain or loss. The Company will be allowed a business
expense deduction to the extent the optionee recognizes ordinary income.

An optionee will not recognize any U.S. Federal taxable income at the time the
optionee is granted an NQSO. However, upon exercise of the NQSO, the optionee
will recognize ordinary income for federal income tax purposes in an amount
generally measured as the excess of the then fair market value of the Common
Stock over the exercise price, and the Company will be entitled to a deduction
at the time of exercise. If the Company complies with the applicable income tax
withholding or information reporting requirements, it will be entitled to a
business expense deduction in the same amount and at the same time as the
optionee recognizes ordinary income. Upon an optionee's sale of such shares,
any difference between the sale price and fair market value of such shares on
the date of exercise will be treated as capital gain or loss and will qualify
for long-term capital gain or loss treatment if the shares of Common Stock have
been held for more than one year.

Upon the grant of a SAR, the optionee recognizes no taxable income. Upon
exercise of a SAR, the optionee recognizes ordinary income as of the date of
exercise in an amount equal to the excess of the fair market value of the Common
Stock on the date of exercise over the exercise price. An optionee exercising a
SAR is subject to Federal income tax withholding on the income recognized as a
result of the exercise of the SAR. The Company is entitled to a deduction (in
the same year in which the grantee recognizes income) to the extent of the
amount includible in the gross income of the optionee.

Upon the making of a Restricted Stock Award, the grantee will recognize no
taxable income unless the grantee files a "section 83(b) election" with the
Internal Revenue Service within thirty days

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after the award. Upon payment of dividends with respect to unvested stock, the
grantee will recognize ordinary income and the Company generally will be
entitled to a deduction (in the same year in which the grantee recognizes
income) equal to the amount includible in the gross income of the grantee.

Upon vesting of Common Stock in a grantee, the grantee will recognize ordinary
income in an amount equal to the fair market value of such Common Stock on the
date of vesting minus any purchase price paid for the restricted shares. The
Company will generally be entitled to a deduction (in the same year in which the
grantee recognizes income) equal to the amount of ordinary income includible in
the gross income of the grantee.

Upon the making of a Restricted Stock Award with respect to which the grantee
makes a section 83(b) election, the grantee will recognize ordinary income in an
amount equal to the fair market value of such Common Stock on the date of the
grant (determined without regard to any restrictions that will lapse) and the
grantee is subject to Federal income tax withholding. The grantee's holding
period for Common Stock begins on the day of the grant. When the grantee
disposes of such Common Stock, he/she will recognize a long-term or short term
capital gain (or loss) under Code rules which govern stock dispositions,
assuming that the Common Stock is held by the grantee as capital assets. The
Company will generally be entitled to a deduction (in the same year in which the
grantee recognizes income) equal to the amount of ordinary income includible in
the gross income of the grantee.

Different rules for measuring ordinary income may apply if the optionee is
subject to Section 16 of the Securities Exchange Act of 1934, as amended.

The foregoing does not purport to be a complete summary of the effect of
Federal income taxation upon holders of Options, SARs or Restricted Stock upon
the Company. It also does not reflect provisions of the income tax laws of any
municipality, state or foreign country.

ADVANTAGES. Adoption of the California Plan will allow the Company to make
stock-based incentive awards to the Company's employees who are residents of
California. The California Plan contains substantially the same provisions as
the Current 1995 Plan, except for certain changes intended to comply with
certain requirements to qualify shares issuable under the California Plan under
the state securities laws of the State of California. The Current 1995 Plan has
been amended so that the total number of shares of Common Stock issuable under
both the California Plan and the Current 1995 Plan will remain equal to the
number of shares currently issuable under the Current 1995 Plan. Accordingly,
approval of the California Plan will not increase the total number of shares
available for Awards, but will permit residents of the State of California to be
recipients of such Awards.

THE BOARD OR DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 3.

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INTRODUCTION TO PROPOSALS 4, 5, 6, 7 AND 8

The Board of Directors has observed that certain tactics, including proxy
fights and hostile tender offers, have become relatively common in connection
with unsolicited attempts to gain corporate control. The Board of Directors
considers such tactics to be highly disruptive to a corporation and often
contrary to the overall best interests of its stockholders. In particular, such
tactics frequently represent an attempt to acquire a corporation in the
marketplace at an unfairly low price. Proposals 4, 5, 6, 7 and 8 (collectively,
the "Amendments"), all of which are proposed amendments to the Company's Amended
and Restated Certificate of Incorporation (the "Certificate of Incorporation")
(and, in the case of Proposal 4, amendments to the Company's Bylaws), are being
submitted for stockholder to improve the flexibility of the Board of Directors
in dealing with any unsolicited takeover offers.

By unanimous written consent dated April 18, 1996, the Board of Directors
proposed that stockholders approve the Amendments.

The Amendments are intended to encourage persons seeking to acquire control of
the Company to initiate such efforts through negotiations with the Company's
Board of Directors. The Board of Directors believes that the Amendments will
help give the Board of Directors the time necessary to evaluate any unsolicited
offers, as well as appropriate alternatives, in a manner which assures fair
treatment of the Company's stockholders. The Amendments are also intended to
increase the bargaining leverage of the Board of Directors, on behalf of the
Company's stockholders, in any negotiations concerning a potential change of
control of the Company. The Amendments would, however, make more difficult or
discourage a proxy contest or the assumption of control by a substantial
stockholder and thus could increase the likelihood that incumbent directors will
retain their positions. The Amendments, if they are adopted, could also have
the effect of discouraging a third party from making a tender offer or otherwise
attempting to obtain control of the Company even though such attempt might be
favored by some of the Company's stockholders.

The Amendments are permitted by Delaware law and are consistent with the rules
of the NASDAQ Small Cap Market System on which the Company's Common Stock is
traded. The Amendments have not been proposed as a result of any specific
efforts of which the Company is aware to nominate or elect any director, to
accumulate shares, or to obtain control of the Company by means of a merger,
tender offer, solicitation in opposition to management, or otherwise. The Board
of Directors does not contemplate recommending the adoption of any further
amendments to the Certificate of Incorporation or By-Laws of the Company that
would affect the ability of third parties to effect a change in control of the
Company. However, the Board of Directors may wish in the future to review the
advisability of adopting other measures that may affect takeovers to the extent
permitted by applicable law and judicial decisions.

EXISTING ARRANGEMENTS WITH POSSIBLE ANTI-TAKEOVER EFFECT

The Company's current Certificate of Incorporation does not contain provisions
intended by the Company to have, or to the knowledge of the Board or Directors
having, an anti-takeover effect. However, the Certificate of Incorporation
currently authorizes the issuance of 50,000,000 shares of Common Stock and
10,000,000 shares of Preferred Stock, a substantial number of which have not

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been issued or reserved for issuance. This authorized and available Common Stock
and Preferred Stock could (within the limits imposed by applicable law and the
rules of the NASDAQ Small Cap Market System) be issued by the Company and used
to discourage a change in control of the Company. For example, the Company could
privately place shares with purchasers who might side with the Board of
Directors in opposing a hostile takeover bid. Further, the Board of Directors
could adopt a Stockholder Rights Plan (sometimes referred to as a "poison
pill"), pursuant to which rights would be issued to current stockholders of the
Company which would entitle, under certain circumstances, all holders, other
than the bidder, to purchase additional shares of Common Stock at prices
possibly substantially below market value. Shares of Common Stock or Preferred
Stock could also be issued to a holder that would thereafter have sufficient
voting power to assure that any proposal to amend or repeal certain provisions
of the Certificate of Incorporation and Bylaws would not receive the two-thirds
vote contemplated by Proposal 8. (See "Proposal 4: Classification of the Board
of Directors and Related Matters" and "Proposal 8: Proposed Amendment to
Certificate of Incorporation Adopting Requirement of a Supermajority Vote for
Amendment or Repeal of Certain Provisions of the Restated Certificate of
Incorporation".)

The Company's 1995 Stock Incentive Plan provides that upon a "change in
control" of the Company (as defined in such Plan), the Compensation Committee
(as it is constituted on the day preceding the date of the change in control)
may, in its discretion, accelerate the vesting and exercisability of outstanding
stock options and stock appreciation rights, and the vesting of restricted stock
awards granted under such Plan. This provision is designed to attract and retain
valued employees of the Company and to ensure that such employees' performance
is not undermined by the possibility, threat or occurrence of a change of
control. While this provision was not adopted to deter takeovers, it may have an
incidental anti-takeover effect by making it more expensive for a bidder to
acquire control of the Company.

Section 203 of the Delaware General Corporation Law may have an anti-takeover
effect with respect to the Company. Such section restricts the ability of an
"interested stockholder" (defined in the statute) to complete a business
combination with a Delaware corporation (with certain exceptions) for three
years after the date it became an interested stockholder unless (i) prior to
such date the board approved either the business combination or the transaction
which resulted in the stockholder becoming an interested stockholder, (ii) upon
consummation of the transaction which resulted in the stockholder becoming an
interested stockholder, the interested stockholder owned at least 85% of the
voting stock of the corporation (excluding shares held by certain persons), or
(iii) on or subsequent to such date, the business combination is approved by the
Board of Directors and authorized at an annual or special meeting of stockholder
by the affirmative vote of at least two-thirds of the outstanding voting stock
which is not owned by the interested stockholder.

EFFECTIVENESS

The procedural requirements relating to nomination of directors and
presentation of proposals at an annual or special meeting of stockholders which
would be effected upon the approval of Proposals 6 and 7 do not apply to the
1996 Annual Meeting of Stockholders but, if approved, will

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<PAGE>

apply to the 1997 Annual Meeting of Stockholders and to any earlier special
meeting of stockholders (subject to future amendment or repeal by the
stockholders).

DESCRIPTION OF THE PROPOSED AMENDMENTS

The proposed amendments to the Certificate of Incorporation and Bylaws are set
forth in the exhibits to this Proxy Statement. The following description of the
Amendments is qualified in its entirety by reference to such exhibits.

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PROPOSAL 4

CLASSIFICATION OF THE BOARD OF DIRECTORS AND RELATED MATTERS

(Item 4 on Proxy Card)

The Company's Board of Directors has unanimously approved and recommended that
the stockholders of the Company approve an amendment to Article Eighth to the
Certificate of Incorporation (i) to provide for the classification of the Board
of Directors into three classes of directors with staggered terms of office and
(ii) to provide that a director may be removed only by the holders of a majority
of the shares and only for cause. Article Eighth currently provides directors
may be removed, with or without cause, by the holders of a majority of the
shares entitled to vote at an election of directors. The proposed amendment
will also increase the stockholder vote required to amend or repeal, or to adopt
any provision inconsistent with, the classified-board amendment to two-thirds of
the voting power of the Company.

The Board of Directors has also unanimously approved and recommended that the
stockholders of the Company approve (i) an amendment to Section 2.01 of the
Company's Bylaws to delete the sentence which states that directors shall be
elected for a one year term and to substitute a sentence which provides that
directors shall hold office as provided in Article Eighth of the Company's
Certificate of Incorporation and (ii) an amendment to Section 6.01 of the
Company's Bylaws to provide that Section 2.01 (as so amended) of the Bylaws may
only be further amended by the directors of the Company or by stockholders
representing two-thirds of the vote. Section 2.01 of the Bylaws provides that
the number of directors of the Company shall be fixed by the Board of Directors
but in no event shall be less than three or more than nine.

Currently, the Company's directors are elected annually for a term of one
year. Delaware law permits provisions in a certificate of incorporation or
bylaw approved by stockholders that provide for a classified board of directors.
The proposed amendment to the Certificate of Incorporation would provide that
directors will be classified into three classes as nearly equal in number as
possible. One class would hold office initially for a term expiring at the 1997
Annual Meeting; another class would hold office initially for a term expiring at
the 1998 Annual Meeting; and another class would hold office initially for a
term expiring at the 1999 Annual Meeting. At each annual meeting following this
initial classification and election, the successors to the class of directors
whose terms expire at that meeting would be elected for a term of office to
expire at the third succeeding annual meeting after their election and until
their successors have been duly elected and qualified. See "Election of
Directors" as to the composition of each class of directors if this proposal is
adopted.

The Bylaws of the Company currently provide that the number of directors of
the Company shall be the number fixed by the Board of Directors, but may not be
less than three nor more than nine. Since stockholders of the Company may amend
the Bylaws, they currently could set the size of the Board at any number.
Proposal 4 includes an amendment to the Bylaws which would require a two-thirds
stockholder vote to amend or repeal this provision of the Bylaws. Accordingly,
holders of Common Stock would not be able to obtain control of the Board simply
by exercising their voting power to enlarge the number of authorized directors
and filling the

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vacancies created with their own nominees. Under Proposal 4, stockholders would
not be able to force an increase in the size of the Board except by Board action
taken at such time, if any, as such stockholders' nominees constitute a majority
of the entire board, or upon obtaining the requisite two-thirds stockholder vote
to amend this Bylaw provision. Under Proposal 4, a two-thirds stockholder vote
would also be required to amend or repeal the classified board amendment to the
Certificate of Incorporation.

The proposed classified board amendment can significantly extend the time
required to effect a change in control of the Board of Directors and may
discourage hostile takeover bids for the Company. Currently, a change in
control of the Board of Directors can be made by stockholders holding a
plurality of the votes cast at a single annual meeting. If the Company
implements a classified board of directors, it will take at least two annual
meetings for even a majority of stockholders to make a change in control of the
Board of Directors, because only a minority of the directors will be elected at
each meeting, unless stockholders with two-thirds of the voting power of all of
shares of stock entitled to vote effect the repeal of the provisions which
prohibits removal of directors except for cause and adopt provisions allowing
such removal.

Under Delaware law, directors chosen to fill vacancies on a classified board
shall hold office until the next election of the class for which such directors
shall have been chosen, and until their successors are elected and qualified.
Delaware law also provides that, unless the Certificate of Incorporation
provides otherwise, directors serving on a classified board of directors may be
removed only for cause. Proposal 4 would delete from the Certificate of
Incorporation the current provision which provides that directors may be
removed, with or without cause, by the holders of a majority of the shares
entitled to vote at an election of directors and provide instead that a director
may be removed only by the holders of a majority of the shares and only for
cause. Except as may otherwise be provided by law, cause for removal will be
construed to exist only if (i) the director whose removal is proposed has been
convicted of a felony by a court of competent jurisdiction and the conviction is
no longer subject to direct appeal, (ii) the director has been adjudged by a
court of competent jurisdiction to be liable for negligence or misconduct in the
performance of his or her duty to the corporation in a matter of substantial
importance to the corporation, and the adjudication is no longer subject to
direct appeal or (iii) any other situation exists which eighty percent (80%) of
the other directors, in their sole discretion, agree constitutes cause for
removal.

Cumulative voting is not authorized by the Certificate of Incorporation.

ADVANTAGES. The classified board proposal is designed to assure continuity
and stability in the Board of Directors' leadership and policies. While
management has not experienced any problems with such continuity in the past, it
wishes to ensure that this experience will continue. The Board of Directors
also believes that the classified board proposal will assist the Board of
Directors in protecting the interests of the Company's stockholders in the event
of an unsolicited offer for the Company.

DISADVANTAGES. Because of the additional time required to change control of
the Board or Directors, the classified board proposal may tend to perpetuate
present management. Without the

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ability to obtain immediate control of the Board of Directors, a takeover bidder
will not be able to take action to remove other impediments to its acquisition
of the Company, unless such bidder can repeal certain provisions of the
Certificate of Incorporation by a vote of stockholders representing shares
entitled to two-thirds of the voting power of all of shares of stock. Because
the classified board proposal will increase the amount of time required for a
takeover bidder to obtain control of the Company without the cooperation of the
Board of Directors, even if the takeover bidder were to acquire a majority of
the Company's outstanding stock, it may tend to discourage certain tender
offers, perhaps including some tender offers that some stockholders may feel
would be in their best interests. The classified board proposal will also make
it more difficult for the stockholders to change the composition of the Board of
Directors, even if the stockholders believe such a change would be desirable.

The proposed amendments to the Certificate of Incorporation and Bylaws which
would be adopted if Proposal 4 is approved are set forth in Exhibits A and B,
respectively, to this Proxy Statement. The foregoing description of such
amendments is qualified in its entirety by reference to such exhibits.

REQUIRED VOTE

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR PROPOSAL 4.

21
<PAGE>

PROPOSAL 5

PROPOSED AMENDMENT TO CERTIFICATE OF INCORPORATION ESTABLISHING
REQUIREMENT THAT STOCKHOLDER ACTION BE TAKEN AT A MEETING

(Item 5 on Proxy Card)

The Company's Board of Directors has unanimously approved and recommended that
the stockholders of the Company approve the addition of a new Article Eleventh
to the Certificate of Incorporation which would require that all stockholder
action be taken at a stockholders' meeting. Under Delaware law, unless the
certificate of incorporation of a corporation provides otherwise, any action
required or permitted to be taken by stockholders may be taken without a meeting
and without a stockholder vote if a written consent setting forth the action to
be taken is signed by stockholders having the requisite voting power necessary
to authorize such action at a stockholders' meeting. The Company's Certificate
of Incorporation currently does not provide otherwise. Proposed Article
Eleventh of the Certificate of Incorporation would require all stockholder
action be taken at an annual meeting or special meeting of the stockholders, and
would prohibit stockholder action by written consent. Under the Company's
Bylaws, a stockholders' meeting may be called only by the President, a majority
of the Company's directors or stockholders representing a majority of the shares
of the Company entitled to vote. Thus, this amendment would permit the Board
or Directors to delay consideration, until the next annual stockholders'
meeting, of action favored by a substantial percentage (but less than a
majority) of the holders of the outstanding stock.

ADVANTAGES. Under Delaware law, when stockholders are to take action at a
meeting, a corporation must give written notice of the meeting to all
stockholders entitled to vote, even when a stockholder or group will have a
majority of the vote to be cast. This prior notice allows minority stockholders
to take whatever action they deem appropriate to protect their interest,
including seeking to persuade majority stockholders to follow a different
course, selling their shares or litigation. The primary purpose of Proposal 5
is to prevent stockholder action without prior notice to all stockholders. The
effect of Proposal 5 would be to give all of the Company's stockholders the
opportunity to participate in a proposed stockholder action. The Board of
Directors also believes that eliminating the written consent procedure would
prevent sudden stockholder action to remove the entire Board of Directors and
would thereby preserve the Board of Directors' ability to negotiate with a
potential takeover bidder or other person seeking control on behalf of the
Company's stockholders.

DISADVANTAGES. The provisions eliminating stockholder action by written
consent would preclude action by written consent of the stockholders even if a
majority of the stockholders believed such action to be in their best interests.
The effect of such provisions may be to discourage potential purchasers from
attempting to acquire control of the Company.

The proposed amendment to the Certificate of Incorporation which would be
adopted if Proposal 5 is approved is set forth in Exhibit C to this Proxy
Statement. The foregoing description of such amendment is qualified in its
entirety by reference to such exhibit.

22
<PAGE>

REQUIRED VOTE

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR PROPOSAL 5.

23
<PAGE>

PROPOSAL 6

PROPOSED AMENDMENT TO CERTIFICATE OF INCORPORATION
ESTABLISHING PROCEDURES FOR NOMINATING DIRECTORS

(Item 6 on Proxy Card)

The Company's Board of Directors has unanimously approved and recommended that
the stockholders of the Company approve the addition of a new Article Twelfth to
the Certificate of Incorporation that would establish procedures with respect to
the nomination of persons for election as directors. The proposed new article
provides that a stockholder intending to nominate a director for election at an
annual meeting of stockholders must give written notice of such intention to the
Company not less than seventy-five (75) days prior to the first anniversary of
the preceding year's annual meeting (or, if the date of an annual meeting is
changed by more than twenty (20) days from the anniversary date of the preceding
year's annual meeting, not later than ten (10) days after the date the Company
first mails to stockholders notice of the date of the annual meeting). With
respect to an election to be held at a special meeting of stockholders called
for the purposes of electing directors, a stockholder intending to nominate a
director would be required to give written notice of that intention to the
Company not later than ten (10) days after the date the Company first mails to
stockholders of the Company notice of the date of the special meeting. At
present, any stockholder may nominate a director during a stockholders meeting
at which directors are to be elected without any prior notice.

The proposed amendment requires that any notice of intention to nominate a
director must contain certain information about the proposed nominee and about
the stockholder intending to make the nomination. The Company may also require
any proposed nominees to furnish other information reasonably required by the
Company to determine the proposed nominee's qualifications to serve as a
director.

The purpose of the amendment in requiring advance notice of a nomination by a
stockholder is to afford the Board of Directors a meaningful opportunity to
consider the qualifications of any proposed nominee and, to the extent deemed
necessary or desirable by the Board, to inform stockholders about such
qualifications. While the amendment does not give the Board of Directors any
power to approve or disapprove of a stockholder nomination, it will preclude a
stockholder nomination from the floor at a stockholders' meeting or by other
means if the proper procedures are not followed. The determination as to
whether the notice provisions have been met will be made by the presiding
officer at the meeting. The current form of the Company's Certificate of
Incorporation and Bylaws and the law of Delaware, the jurisdiction in which the
Company is incorporated, contain no notice provisions similar to that set forth
in the amendment.

ADVANTAGES. The amendment is being proposed because the Board considers it
advantageous to be able to consider and evaluate in advance the qualifications
of any proposed nominee, as opposed to being confronted with a surprise
nomination at or shortly prior to a meeting of stockholders.

24
<PAGE>

DISADVANTAGES. Although the Board of Directors does not believe that the
amendment will have a significant impact on any attempt by a third party to
obtain control of the Company, it is possible that the amendment may deter a
third party from conducting a solicitation of proxies to elect its own slate of
directors or otherwise attempt to obtain control of the Company or effect a
change in management, irrespective of whether such action would be beneficial to
stockholders generally.

The proposed amendment to the Certificate of Incorporation which would be
adopted if Proposal 6 is approved is set forth in Exhibit D to this Proxy
Statement. The foregoing description of such amendment is qualified in its
entirety by reference to such exhibit.

REQUIRED VOTE

THE BOARD OR DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR PROPOSAL 6.

25
<PAGE>

PROPOSAL 7

PROPOSED AMENDMENT TO CERTIFICATE OF INCORPORATION
ESTABLISHING PROCEDURES FOR PRESENTING PROPOSALS
AT AN ANNUAL OR SPECIAL MEETING OF STOCKHOLDERS

(Item 7 on Proxy Card)

The Company's Board of Directors has unanimously approved and recommended that
the stockholders of the Company approve the addition of a new Article Thirteenth
to the Certificate of Incorporation that would establish procedures with respect
to the making of substantive motions by stockholders at an annual or special
meeting of stockholders. The proposed new article provides that only a
stockholder of the Company who provides timely advanced notice of a proposed
substantive motion in accordance with provisions of the article may make such
substantive motion at an annual or special meeting. To be timely, a
stockholder's notice of an intent to make a substantive motion at a meeting must
be received in writing at the principal executive offices of the Company (i)
with respect to an annual meeting of stockholders, must be received by the
Company not less than seventy-five (75) days prior to the first anniversary of
the preceding year's annual meeting (or, if the date of an annual meeting is
changed by more than twenty (20) days from the anniversary date of the preceding
year's annual meeting, not later than ten (10) days after the date the Company
first mails to stockholders of the Company notice of the date of the annual
meeting) and (ii) with respect to a special meeting of stockholders, not later
than ten (10) days after the date the Company first mails to stockholders of the
Company notice of the date of the special meeting.

The stockholder's notice to the Company must set forth in writing each
proposal the stockholder desires to bring before the meeting and any material
interest of the stockholder in such proposal. The current form of the Company's
Certificate of Incorporation and Bylaws and the law of Delaware, the
jurisdiction in which the Company is incorporated, contain no notice provisions
similar to that set forth in the amendment. The determination as to whether the
notice provisions have been met will be made by the presiding officer at the
meeting.

ADVANTAGES. Article Thirteenth provides an orderly procedure for the
notification of the Board of Directors of business that is to be presented at
stockholders' meetings. This will enable the Board of Directors to plan such
meetings and also, to the extent it deems it necessary or desirable, to inform
the stockholders, prior to the meeting, of any new business that is proposed to
be presented at a stockholders' meeting by a stockholder. The Board of
Directors will also be able to make a recommendation or statement of its
position to enable the stockholders better to determine whether they desire to
attend the stockholders' meeting or grant a proxy to the Board of Directors as
to the disposition of any such business. The amendment can also have the effect
of discouraging belated attempts by third-parties to begin ill-considered,
disruptive, discussions at a stockholder's meeting. The proposed provision does
not give the Board of Directors any power to approve or disapprove the business
that stockholders desire to be conducted at the stockholders' meeting, but it
does provide for a more orderly procedure for conducting the

26
<PAGE>

stockholders' meeting. Further, nothing in the proposed procedure precludes
discussion by any stockholder of any business properly brought before the
stockholders' meeting.

DISADVANTAGES. The proposed procedure precludes the conducting of business at
a particular meeting if the proper notice procedures have not been followed. A
stockholder who does not determine by the applicable deadline for a
stockholders' meeting that it believes certain action would be desirable could
be precluded from obtaining stockholder action on such proposal at such meeting.

The proposed amendment to the Certificate of Incorporation which would be
adopted if Proposal 7 is approved is set forth in Exhibit E to this Proxy
Statement. The foregoing description of such amendment is qualified in its
entirety by reference to such exhibit.

REQUIRED VOTE

THE BOARD OR DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR PROPOSAL 7.

27
<PAGE>

PROPOSAL 8

PROPOSED AMENDMENT TO CERTIFICATE OF INCORPORATION ADOPTING REQUIREMENT
OF A SUPERMAJORITY VOTE FOR AMENDMENT OR REPEAL OF CERTAIN PROVISIONS OF THE
RESTATED CERTIFICATE OF INCORPORATION

(Item 8 on Proxy Card)

The Company's Board of Directors has unanimously approved and recommended that
the stockholders of the Company approve the addition of a new Article Fourteenth
to the Certificate of Incorporation which would require a two-thirds stockholder
vote to amend or repeal certain provisions of the Certificate of Incorporation,
as described more fully below.

Currently, the Certificate of Incorporation may be amended or repealed by the
vote of stockholders holding a majority of the voting power of the Company. As
permitted by Delaware law, this proposal would require the affirmative vote of
the holders of at least two-thirds of the voting power of all of the then-
outstanding shares of stock entitled to vote generally for the election of
directors, voting together as a single class, for the amendment or repeal of any
of the provisions of the Certificate of Incorporation implemented by Proposals
4, 5, 6 and 7. The two-thirds supermajority vote requirement would also apply
to any amendment or repeal of Article Tenth of the Certificate of Incorporation.
Article Tenth provides that, with certain exceptions, the directors of the
Company shall not be personally liable to the Company or its stockholders for
monetary damages for the breach of their fiduciary duty as directors.

ADVANTAGES. The requirements of this proposal will prevent a stockholder with
a majority of the voting power of the Company from avoiding the requirements of
the protected provisions of the Certificate of Incorporation by simply repealing
them or by causing a majority of the Board of Directors to do so. The
supermajority protection given to the director liability provisions of the
Certificate of Incorporation will help ensure that the Company's agents are
adequately protected against liability in the event of a proposed takeover,
thereby allowing them to focus on the best interests of the Company and its
stockholders.

DISADVANTAGES. This requirement could give stockholders holding a significant
minority of the Company's stock a veto power over certain changes to the
Certificate of Incorporation even if a majority of the stockholders favor such
changes.

The proposed amendment to the Certificate of Incorporation which would be
adopted if Proposal 8 is approved is set forth in Exhibit F to this Proxy
Statement. The foregoing description of such amendment is qualified in its
entirety by reference to such exhibit.

REQUIRED VOTE

In order to be adopted, this proposal must receive the affirmative vote of
holders of shares entitled to a majority of the votes represented by the shares
of all classes of stock of the Company eligible to vote at the meeting. As
described above, if this proposal is approved, the affirmative vote of the
holders of at least two-thirds of the voting power of all of the then-
outstanding shares of stock entitled to vote generally for the election of
directors, voting as a single class, will be required to amend or repeal any of
the provisions described above.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR PROPOSAL 8.

28
<PAGE>

EXECUTIVE COMPENSATION

REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS

The Company's Compensation Committee is comprised of three outside Directors
of the Company, currently Messrs. Chambers (Chairman), Havens and Monaco. At
least annually, the Compensation Committee reviews the compensation levels of
the Company's executive officers and certain other key employees and makes
recommendations to the Board of Directors regarding compensation of such
persons. In general, the Compensation Committee endeavors to base the
compensation of the executive officers on individual performance, performance
against established financial goals based on the Company's strategic plan, and
comparative compensation paid to executives of direct competitors and of non-
financial, service companies.

In 1995, the Committee was involved in setting the compensation of the
Chairman and Chief Executive Officer, Executive Vice President, former Executive
Vice President of Operations, Vice President of Corporate Development, Vice
President of Operations for the private schools operations on the west coast,
Vice President of Finance and Administration and General Counsel.

Executive officers' compensation generally consists of base salary which
comprises a significant portion of total compensation, bonuses that are based on
Company performance, fringe benefits, and stock options. All executive officers
are reviewed annually for performance, and salary changes are effective in
March. Bonuses are distributed after the results of the audit of the financial
statements have been verified by the Board.

In 1995, salary levels were based on the survey performed in May 1994 by
Towers and Perrins. Increases were based on performance of the executive as
well as performance of the Company.

In 1995, the Company's revenues increased 28% from $34,371,501 to $44,154,367.
Net income increased 64% from $2,339,776 to $3,843,866. Fully diluted earnings
per share increased from $0.46 to $0.63. The stock price of the Company
increased $10 7/8 or 189% from a high of $5 3/4 in 1994 to a high of $16 5/8 in
1995. In 1995, the management team implemented the Company's growth strategy.
Accomplishments included completing three acquisitions and refinancing the
Company's existing debt facilities. Salaries were based on the contributions
the executives made toward the growth of the Company, as well as performance of
the base operations compared to the annual business plan.

Towers Perrin met with the Compensation Committee members and the Company's
executive management to learn about the Company's executives' responsibilities
and developed competitive compensation levels using published and private data
sources covering companies in the service and education industries, some of
which are included in the peer group in the five year performance graph. Towers
Perrin then developed the salary structure for executive positions.

The Chairman and Chief Executive Officer's compensation included an annual
base salary of $160,000, a bonus plan tied to the net income as compared to the
annual plan submitted to and approved by the Board of Directors in December 1994
and customary fringe benefits. In March 1995, the Board of Directors approved a
$20,000 increase for Mr. Clegg, based on the performance

29
<PAGE>

of the Company, which he voluntarily declined. In addition to salary and bonus,
the Chairman also received in December 1995 a grant of options to purchase
45,000 shares of stock.

The Compensation Committee established the other executive officers' base
salaries in 1995 by reviewing salary levels for similar positions of direct
competitors (including , but not limited to, those companies constituting the
peer group index that appears in the five-year performance graph) and other
educational companies. The Compensation Committee believes that the Company's
most direct competitors for executive talents are not necessarily all the
companies that would be included in a peer group established to compare
shareholder return. The Compensation Committee believes that the salaries of
the executive officers are in line with salary ranges in the companies that they
reviewed. The Compensation Committee believes that the salaries of the executive
officers are in line with salary ranges in the companies that they reviewed.

The Company also has an internal compensation committee consisting of A. J.
Clegg and John Frock. Except for the executives reviewed by Compensation
Committee, all other salaries and performance are reviewed by this internal
committee. This committee reviews and reports on individual performance to the
Compensation Committee, which then authorizes increases or changes based on
competitors' levels and performance.

Each bonus plan for executive officers is specific to the individual's areas
of responsibility. The Executive Vice President of the Company's bonus in 1995
was based on net income for 1995 as compared to the annual plan. The bonus of
the former Executive Vice President of Operations and Vice President of
Operation was based on preset formulas related to the growth of operation income
as compared to the prior year.

The bonus of the Vice President of Corporate Development was based on a
formula relating to the number of successful schools opened as compared to the
business plan. The bonus of the Vice President of Finance and Administration
and General Counsel was based on a formula relating percentage growth in pretax
income.

In 1995, the Board of Directors and stockholders approved the 1995 Stock
Incentive Plan which authorizes the Company to issue an aggregate of 375,000
shares of stock to its employees. The Compensation Committee believes that
stock incentives are the principal vehicle for payment of long term
compensation. This component of compensation is intended to retain and motivate
executives to improve profitability which will ultimately leads to improved
stock market performance. Stock options were granted in December 1995 to
management and key employees based primarily on the individuals potential
contribution. These were granted at the fair market value at the date of the
grant.

COMPENSATION COMMITTEE

Mr. Edward Chambers
Mr. Peter Havens
Mr. Eugene Monaco

30
<PAGE>

COMPENSATION TABLES

The following tables contain compensation data for the Chief Executive
Officer, the two other executive officers of the Company whose salary and bonus
in 1995 aggregate to at least $100,000, and two former executive officers.

<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE

---------------------------------------------------------------------------------
LONG TERM
ANNUAL COMPENSATION COMPENSATION AWARDS
-------------------------------------------------------------
OTHER SECURITIES ALL OTHER
ANNUAL RESTRICTED UNDERLYING COMPENS-
NAME AND COMPENS STOCK OPTIONS/ ATION/4/
PRINCIPAL POSITION YEAR SALARY BONUS/1/ ATION/2/ AWARDS SARS/3/
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
A.J. CLEGG 1995 $160,014 $96,000 45,000 $2,052
Chairman, President and 1994 57,851 39,978
Chief Executive Officer/5, 6/ 1993 [see fn. 5]

JOHN FROCK 1995 $ 98,082 $33,750 $13,549 25,000 $746
Executive Vice President/7/ 1994 32,539 14,055 14,950
1993

D. SCOTT CLEGG 1995 $ 82,087 $29,400 5,000 $127
Vice President - 1994 73,238 13,320 127
Operations/8/ 1993 38,795 14,391 6,250

Former Executive Officers
- ----------------------------------------
F. E. MONTGOMERY 1995 $149,842 5,000 $395
Former President and 1994 158,357 $55,650 395
Chief Operating Officer/9/ 1993 147,124 52,500 300

WALLY T. ORREL 1995 $103,403 $21,000 $13,450 31,250 $1,025
Former Executive Vice 1994 83,551 31,040 27,870
President - Operations/10/ 1993 16,562 10,335 22,942 7,500
</TABLE>

(1) Bonuses are reported with respect to the fiscal year earned, although paid
in the following year.

(2) The amounts reported for John Frock consisted of (i) $7,800 and $3,082 for
automobile expenses in 1995 and 1994, respectively, and (ii) $5,511 and
$895 for health insurance in 1995 and 1994, respectively. The amounts
reported for Wally T. Orrel consisted of (i) $7,800, $7,800 and $4,550 for
automobile expenses in 1995, 1994 and 1993, respectively, and (ii) $5,831,
$9,790 and $5,854 for health insurance in 1995, 1994 and 1993,
respectively. While other named executives enjoy certain similar
perquisites, for fiscal year 1995, perquisites and other personal benefits
for such executive officers did not exceed the lesser of $50,000 or 10% of
any such executive officer's salary and bonus and accordingly have been
omitted from the table as permitted by the rules of the Securities and
Exchange Commission.

(3) Options granted in 1993 to Wally T. Orrel and Scott Clegg were granted at
the commencement of their respective employment. A portion of such options
vested at the end of each of 1993, 1994 and 1995 for achieving the business

31
<PAGE>

plans for such year. For information regarding options granted in 1995 to
A.J. Clegg, John Frock, D. Scott Clegg and Wally T. Orrel, see
"Options/Stock Appreciation Rights Grants in 1995."

(4) Other compensation in 1995: for A.J. Clegg consisted of $2,052 for life
insurance; for John Frock consisted of $742 for life insurance in 1995; for
D. Scott Clegg consisted of $127 for life insurance and for Wally T. Orrel
consisted of $1,025 for life insurance in 1995 and $776 for employer
matching 401(k) plan contributions.

(5) In August 1994, A.J. Clegg was hired as an employee of the Company in the
position of Chairman and Chief Executive Officer. Prior to this time, Mr.
Clegg was the Chairman and Chief Executive Officer of JBS Investment
Banking, Ltd. ("JBS"). On May 29, 1992, pursuant to a private placement
offering, the Company entered into a three year Administrative Services
Agreement with JBS, pursuant to which JBS provided management and advisory
services to the Company and received certain management fees. The fixed fee
portion of this agreement was terminated in August 1994 when Mr. Clegg
joined the Company as a full time employee. During 1995, 1994 and 1993,
respectively, the Company paid fees to JBS approved by the Board totaling
$8,289, $200,374 and $400,000 for the services of JBS personnel, which
included A.J. Clegg, John Frock and four other persons. Mr. Clegg joined
the Company as a full time employee on August 1, 1994.

(6) On March 1, 1995, the Board of Directors approved an increase in Mr.
Clegg's base salary of $20,000, from $160,014 to $180,014. Mr. Clegg
voluntarily declined taking such increase in 1995.

(7) John Frock joined the Company as a full time employee on August 1, 1994.

(8) D. Scott Clegg joined the Company in June 1993.

(9) F. E. Montgomery joined the Company in January 1993. His employment with
the Company terminated in February 1995.

(10) Wally T. Orrel joined the Company in April 1993. His employment with the
Company terminated in December 1995.

32
<PAGE>

OPTIONS/STOCK APPRECIATION RIGHTS GRANTED IN 1995

<TABLE>
<CAPTION>
POTENTIAL REALIZED VALUE AT ASSUMED
ANNUAL RATES OF STOCK PRICE
APPRECIATION FOR OPTION TERM
INDIVIDUAL GRANTS (10 YRS.)/1/
--------------------------------------------------------------------------------------------------
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/
UNDERLYING SARS AT 0% AT 5% AT 10%
OPTION/ GRANTED EXERCISE OR ANNUAL ANNUAL ANNUAL
NAME OF SARS TO ALL BASE PRICE EXPIRATION GROWTH GROWTH GROWTH
EXECUTIVE GRANTED/2/ EMPLOYEES PER SHARE DATE/2/ RATE RATE RATE
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
A. J. Clegg 45,000 33.73% $11.625 12/18/05 $0 $328,991 $833,727

John R. Frock/3/ 25,000 18.74% $11.625 12/18/05 $0 $182,773 $463,181

D. Scott Clegg 5,000 3.75% $11.625 12/18/05 $0 $36,555 $92,636

Wally T. Orrel 31,250 23.43% $4.00 1/16/05 $0 $78,612 $199,218
- ---------------------
All Share Owners/4/ N/A N/A N/A N/A $0 $29,938,768 $75,870,857
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) The potential realizable values are based on an assumption that the stock
price of the shares of Common Stock of the Company appreciate at the annual
rate shown (compounded annually) from the date of grant until the end of
the option term. These values do not take into account amounts required to
be paid as income taxes under the Internal Revenue Code of 1986, as
amended, and any applicable state laws, or option provisions providing for
termination of an option following termination of employment,
nontransferability, or vesting over periods of up to three years. These
amounts are calculated based on the requirements promulgated by the
Securities and Exchange Commission and do not reflect the Company's
estimate of future stock price growth of the shares of Common Stock of the
Company.

(2) Options granted to A.J. Clegg, John Frock and Yvonne DeAngelo were granted
on December 18, 1995; options granted to D. Scott Clegg were granted on
November 18, 1995. All such options vest in increments of one-third of the
total number of options granted on the first, second and third anniversary
dates of the date of grant. Options granted in 1995 to Wally T. Orrel were
granted in connection with his execution of an employment agreement dated
January 16, 1995. Such agreement provided that the options had an exercise
price of $4.00 per share and were subject to a vesting schedule. In
connection with the termination of Mr. Orrel's employment, the Company
agreed that 12,500 of such options will remain exercisable through
September 30, 1996 and that the remaining options terminated.

(3) On March 19, 1996, the Company made a Restricted Stock Award to Mr. Frock
under the 1995 Stock Incentive Plan of 25,000 shares of Common Stock. In
connection with such award, Mr. Frock agreed to the cancellation of the
options to purchase 25,000 shares of Common Stock of the Company referenced
in this table. Such Restricted Stock Award is subject to vesting over a
period of three years, with one-third of the shares subject to the award
vesting on each of December 18, 1996, December 18, 1997 and December 18,
1998.

(4) Based on the number of shares outstanding at December 31, 1995 and an
assumed price of the Common Stock equal to the exercise price on the grant
date ($11.625 per share in the case of options granted to Messrs. Clegg,
Frock and Clegg and $4.00 per share in the case of options granted to Mr.
Orrel). The closing price of the Company's Common Stock on the NASDAQ Small
Cap Market System on December 31, 1995 was $17.00.

33
<PAGE>

AGGREGATED OPTION/STOCK APPRECIATION RIGHTS EXERCISES IN 1995
AND VALUE OF OPTIONS AT DECEMBER 31, 1995

VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS AT
EXERCISED IN 1995 OPTIONS AT DECEMBER 31, 1995 DECEMBER 31, 1995
------------------------------------------------------------------------------------------------
SHARES
NAME OF ACQUIRED ON VALUE
EXECUTIVE EXERCISE REALIZED EXERCISABLE UNEXERCISEABLE EXERCISABLE UNEXERCISEABLE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
A. J. Clegg 0 0 0 45,000 0 $241,875

John R. Frock (1) 0 0 0 25,000 0 $134,375

D. Scott Clegg 0 0 6,250 5,000 $85,000 $26,875

F. E. Montgomery 37,500 $70,313 0 0 0 0

Wally T. Orrel 0 0 20,000 0 $264,500 0
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) See footnote (2) to previous table.

None of the above named executive officers held any stock appreciation rights at
December 31, 1995

EMPLOYMENT AGREEMENTS AND SEVERANCE AGREEMENTS

On January 16, 1994, the Company entered into an employment agreement with
Wally Orrel employing him as Executive Vice President. The employment agreement
provides for Mr. Orrel's employment for a period commencing on January 16, 1994
and ending January 15, 2000. Under the employment agreement, Mr. Orrel received
a base salary at an annual rate of $105,000 during the period January 16, 1994
through March 1, 1996. On March 1, 1996, his gross salary would have been
increased to $125,000 if he were promoted at that time to President and Chief
Operating Officer. Upon failure to be promoted to the position of President and
COO by such date, Mr. Orrel would have had the right to resign and receive a
termination payment of six times his base monthly salary, plus one month's
salary for each full year of employment. In addition, the employment agreement
provided for cash bonuses under a bonus plan approved by the Board of Directors;
options to purchase 31,250 shares of Common Stock at an exercise price of $4.00
per share, subject to vesting requirements; and other benefits in accordance to
the Company's policy (paid annual vacation, use of an automobile, and health
insurance). Mr. Orrel's employment with the Company terminated in December
1995. In connection with Mr. Orrel's departure from the Company, the Company
entered into a termination agreement with Mr. Orrel pursuant to which the
Company agreed to continue his base salary and medical insurance for a period of
nine months following his termination date, pay Mr. Orrel five days' unused
vacation pay, and pay him the performance bonus which he would have been
entitled to as an employee with respect to 1995 results of operations.

F. E. Montgomery, the Company's former President, separated from the Company
on February 24, 1995. In connection with his departure from the Company, the
Company entered into a severance agreement with F. E. Montgomery pursuant to
which the Company agreed to continue his base salary for a period of eight
months following his separation plus three weeks' unused vacation pay, provide
him with the use of a Company vehicle and medical insurance for 90 days
following separation, and pay him a performance bonus for 1994 in the amount of
$55,650.

34
<PAGE>

STOCK PERFORMANCE

In 1995, the Company changed its strategic direction from predominately a
child care company to an education company. As a result of this change, the
Company has changed the make up of its peer group in the performance graph.
This year, comparisons are included both to the original peer group selected,
which consists of only child care companies, and the new peer group, which
includes education-oriented companies.

GRAPH I

The following line graph compares the cumulative stockholder return on the
Company's Common Stock with the cumulative total return of the CRSP (Center for
Research in Security Prices) Index for NASDAQ Stock Market (US Companies) and an
index of peer group companies consisting of child care companies. This peer
group was used in the Proxy Statement for the 1995 Annual Meeting of
Stockholders. The graph assumes that the value of the investment in the
Company's Common Stock and each index was $100 at December 30, 1990, and that
all dividends paid by those companies included in the indices were reinvested.

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG NOBEL EDUCATION DYNAMICS, INC.,
THE CRSP INDEX FOR NASDAQ STOCK MARKET AND PEER GROUP

<TABLE>
<CAPTION>
12/90 12/91 12/92 12/93 12/94 12/95
----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Nobel Education Dynamics, Inc. $100 $ 57.9 $115.8 $101.3 $130.3 $492.1

NASDAQ Stock Market
(U.S. Companies) 100 160.5 186.8 214.5 209.7 296.6

Self-Determined Peer Group 100 81.6 132.8 181.0 169.5 152.6
</TABLE>

Assumes $100 was invested on December 31, 1990 in the applicable stock or index,
and that all dividends were reinvested.

The self determined peer group established in 1994 consisted of Children's
Discovery Centers, La Petite Academy, Inc. and Kinder Care Learning Centers,
Inc.

35
<PAGE>

GRAPH II

The following line graph compares the cumulative total stockholder return on
the Company's Common Stock with the total return of the CRSP (Center for
Research in Security Prices) index for NASDAQ Stock Market (U.S. Companies) and
an index of peer group companies selected in 1995 for the period December 30,
1990 through December 31, 1995. The peer group was changed in this Proxy
Statement as described above. The graph assumes that the value of the
investment in the Company's Common Stock and each index was $100 at December 31,
1990 and that all dividends paid by the Companies included in the indexes were
reinvested.

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
BETWEEN NOBEL EDUCATION DYNAMICS, INC.
AND NEWLY ESTABLISHED PEER GROUP
<TABLE>
<CAPTION>
12/90 12/91 12/92 12/93 12/94 12/95
----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Nobel Education Dynamics, Inc. $100 $ 57.9 $115.8 $101.3 $130.3 $492.1

NASDAQ Stock Market
(U.S. Companies) 100 160.5 186.8 214.5 209.7 296.6

Self-Determined Peer Group 100 104.8 161.9 243.1 254.7 388.8
</TABLE>

Assumes $100 was invested on December 31, 1990 in the applicable stock or index,
and that all dividends were reinvested.

The self determined peer group established in 1995 includes Children's Discovery
Centers, ITT Educational Services, La Petite Academy, Youth Services
International, Inc., DeVry Inc., Kinder Care Learning Centers, Inc., and Sylvan
Learning Systems, Inc.

36
<PAGE>

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of
its Common Stock, to file with the Securities and Exchange Commission initial
reports of ownership and reports of changes in ownership of the Company's Common
Stock. Executive officers, directors and ten percent stockholders are required
by SEC regulations to furnish the Company with a copy of all Section 16(a) forms
("Forms 3, 4, and 5") that they file. To the Company's knowledge, based solely
on a review of copies of the Forms 3, 4 and 5 furnished to the Company and
written representations as to all transactions in the Company's securities
effected during the period from January 1, 1995 through December 31, 1995, all
applicable Section 16(a) filing requirements were complied with.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

During 1995, legal services were rendered to the Company by Drinker Biddle &
Reath, of which Morgan R. Jones, a director of the Company, is a partner and
Chairman. The Company expects this firm to continue to provide such services
during 1996.

37
<PAGE>

GENERAL INFORMATION

Stockholders who wish to obtain, free of charge, a copy of the Company's
Annual Report on Form 10-K for the year ended December 31, 1995, as filed with
the Securities and Exchange Commission, may do so by writing or calling Yvonne
DeAngelo, Vice President - Finance and Administration and Secretary, Nobel
Education Dynamics, Inc., Rose Tree Corporate Center II, 1400 North Providence
Road, Suite 3055, Media, Pennsylvania 19063, telephone (610) 891-8200.

DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS

Proposals of stockholders of the Company which are intended to be presented by
such stockholders at the Company's 1997 Annual of Meeting of Stockholders must
be received by the Company no later than January 7, 1997 and be otherwise in
compliance with applicable laws and regulations in order for such proposals to
be included in the Proxy Statement. In addition, if Proposals 6 and 7 are
adopted, the Company's Certificate of Incorporation will require that any
stockholder who wishes to make a nomination for the office of director, or
wishing to initiate a proposal or other business, at the 1997 Annual Meeting
must give the Company advance notice by April 4, 1997 (assuming that such
meeting is not changed by more than 20 days from June 18), and that notice must
meet certain other requirements set forth in the Certificate of Incorporation.

By Order of the Board of Directors

Yvonne DeAngelo

Vice President - Finance and Administration and Secretary

May 7, 1996

38
<PAGE>

EXHIBIT A

PROPOSAL 4:

Resolved, that the Certificate of Incorporation of the Corporation, as
amended, be further amended by the deletion of existing Article Eighth and the
substitution of the following text, so that Article Eighth shall be and read in
its entirety as follows:

"EIGHTH:

1. The directors of the Corporation shall be elected at the annual meeting
of stockholders, except as provided in Section 3 of this Article Eighth. The
directors shall be divided into three (3) classes, as nearly equal in number as
possible, designated Class I, Class II and Class III. Class I directors shall
initially serve until the 1997 annual meeting of stockholders; Class II
directors shall initially serve until the 1998 annual meeting of stockholders;
and Class III directors shall initially serve until the 1999 annual meeting of
stockholders. At each annual meeting of stockholders beginning with the 1997
annual meeting, successors to the class of directors whose term expires at that
annual meeting shall be elected for a term expiring at the third succeeding
annual meeting of stockholders after their election. Except as otherwise
provided by law, if the number of directors is changed, any increase or decrease
shall be apportioned among the classes so as to maintain the number of directors
in each class as nearly equal as possible. In no case shall a decrease in the
number of directors shorten the term of any incumbent director. Notwithstanding
the foregoing, whenever the holders of any one or more classes or series of
preferred stock of the Corporation shall have the right to elect directors at an
annual or special meeting of stockholders, the election, term of office, filling
of vacancies, and other features of such directorships shall be governed by the
terms of this Certificate of Incorporation applicable thereto, or the resolution
or resolutions of the Board of Directors relating to the issuance of such shares
of preferred stock, and such directors so elected shall not be divided into
classes pursuant to this Article Eighth unless expressly provided by such terms
or such resolution or resolutions.

2. A director shall hold office until the annual meeting of stockholders
for the year in which his or her term expires and until his or her successor
shall be elected. Directors may be removed only by the holders of at least a
majority of the outstanding Common Stock and only for cause at a meeting called
for such purpose. Except as may otherwise be provided by law, cause for removal
shall be construed to exist only if (i) the director whose removal is proposed
has been convicted of a felony by a court of competent jurisdiction and the
conviction is no longer subject to direct appeal, (ii) the director has been
adjudged by a court of competent jurisdiction to be liable for negligence or
misconduct in the performance of his or her duty to the corporation in a matter
of substantial importance to the Corporation and the adjudication is no longer
subject to direct appeal or (iii) any other situation exists which at least
eighty percent (80%) of the other directors, in their sole discretion, agree
constitutes cause for removal.

A-1
<PAGE>

3. If any vacancy occurs on the Board of Directors or any new
directorship is created by an increase in the authorized number of directors, a
majority of the directors in office, though less than a quorum, may fill the
vacancy or fill the newly created directorship. Any director elected to fill a
vacancy shall have the same term as that of his or her predecessor, or, if such
vacancy is a result of an increase in the number of directors, as that of the
other directors of the class of which he or she shall be a member.

4. Notwithstanding any other provision of this Certificate of
Incorporation or the Bylaws of the Corporation (and in addition to any other
vote that may be required by law, the Certificate of Incorporation or the Bylaws
of the Corporation), the affirmative vote of the holders of shares entitled to
cast at least two-thirds of the votes represented by the shares of all classes
of stock of the Corporation entitled to vote generally in elections of
directors, considered for purposes of this Article EIGHTH as one class, shall be
required to amend, alter, change, repeal or adopt any provision inconsistent
with this Article EIGHTH.

A-2
<PAGE>

EXHIBIT B

PROPOSAL 4:

Resolved, that the Bylaws of the Corporation, as amended, be further amended
by the deletion of the final sentence of Section 2.01, and the substitution of
new text, so that Section 2.01 shall be and read in its entirety as follows:

Section 2.01. Number and Term of Office. The number of directors of the
-------------------------
Corporation shall be fixed by the Board of Directors but in no event shall be
less than three, or more than nine. If no number is fixed by the Board, the
number of directors shall be three. Directors shall hold office as provided in
Article Eighth of the Company's Certificate of Incorporation.

Resolved, that the Bylaws of the Corporation, as amended, be further amended
by the deletion of existing Section 6.01, and the substitution of the following
text, so that Section 6.01 shall be and read in its entirety as follows:

Section 6.01. By Stockholders or Directors. These Bylaws may be amended or
----------------------------
repealed at any regular meeting of the stockholders or directors, or at any
special meeting thereof if notice of such amendment or repeal be contained in
the notice of such special meeting; provided that Section 2.01 and this Section
6.01 of these Bylaws may only be amended by (i) the directors of the Corporation
or (ii) by the affirmative vote of the holders of shares entitled to cast at
least two-thirds of the votes represented by the shares of all classes of stock
of the Corporation entitled to vote generally in elections of directors,
considered for purposes of this Section 6.01 as one class.

B-1
<PAGE>

EXHIBIT C

PROPOSAL 5:

Resolved, that the Certificate of Incorporation of the Corporation, as
amended, be further amended by the addition of a new Article Eleventh which
shall be and read in its entirety as follows:

ELEVENTH: Subject to the special rights, if any, of the holders of any class
or series of preferred stock established in or pursuant to the provisions of the
Certificate of Incorporation, any action required or permitted to be taken by
the stockholders of the Corporation must be effected at a duly called annual or
special meeting of such holders and may not be effected by any consent in
writing by such holders.

C-1
<PAGE>

EXHIBIT D

PROPOSAL 6:

Resolved, that the Certificate of Incorporation of the Corporation, as
amended, be further amended by the addition of a new Article Twelfth which shall
be and read in its entirety as follows:

TWELFTH: Nominations for the Board.

1. Subject to the special rights, if any, of the holders of any class or
series of preferred stock then outstanding, nominations for the election of
directors may be made by the Board of Directors or a committee appointed by the
Board of Directors or by a stockholder entitled to vote in the election of
directors. However, a stockholder entitled to vote in the election of directors
may make such a nomination only if such stockholder has given timely notice
thereof in writing to the Secretary of the Corporation. To be timely, a
stockholder's notice must be delivered to, or mailed by United States mail,
postage prepaid and received at, the principal executive offices of the
Corporation (a) with respect to an election to be held at an annual meeting of
stockholders, not later than seventy-five (75) days prior to the first
anniversary of the preceding year's annual meeting (or, if the date of the
annual meeting is changed by more than twenty (20) days from such anniversary
date, not later than ten (10) days after the date the Company first mails to
stockholders of the Company notice of the date of the annual meeting), and (b)
with respect to an election to be held at a special meeting of stockholders
called for that purpose, not later than ten (10) days after the date the Company
first mails to stockholders of the Company notice of the date of the special
meeting.

2. Each stockholder's notice of intent to make a nomination must set
forth: (a) the name(s) and address(es) of the stockholder who intends to make
the nomination; (b) a representation that the stockholder (i) is a holder of
record of stock of the Corporation entitled to vote at such meeting, (ii) will
continue to hold such stock through the date on which the meeting is held, and
(iii) intends to appear in person or by proxy at the meeting to nominate the
person or persons specified in the notice; (c) the name, age, business and
residence address(es) and principal occupation or employment of each nominee;
(d) a description of all arrangements or understandings between the stockholder
and each nominee and any other person or persons (naming such person or persons)
pursuant to which the nomination is to be made by the stockholder; (e) such
other information regarding each nominee proposed by such stockholder as would
be required to be included in a proxy statement filed pursuant to Regulation 14A
promulgated under Section 14 of the Securities Exchange Act of 1934, as amended,
as now in effect or hereafter modified, had the nominee been nominated by the
Board of Directors; and (f) the consent of each nominee to serve as a director
of the Corporation if so elected. The Corporation may require any proposed
nominee to furnish such other information as may

D-1
<PAGE>

reasonably be required by the Corporation to determine the qualifications of
such person to serve as a director.

3. The presiding officer of the stockholders' meeting shall determine and
declare at the stockholders' meeting whether the nomination was made in
accordance with the terms of this Article Twelfth. If the presiding officer
determines that a stockholder proposal was not made in accordance with the terms
of this Article Twelfth, he or she shall so declare at the stockholders' meeting
and any such defective nomination shall be disregarded.

D-2
<PAGE>

EXHIBIT E

PROPOSAL 7:

Resolved, that the Certificate of Incorporation of the Corporation, as
amended, be further amended by the addition of a new Article Thirteenth which
shall be and read in its entirety as follows:

THIRTEENTH: Proposals.

1. At an annual or special meeting of stockholders (other than a special
meeting called at the written request of stockholders of the Corporation in
accordance with the Company's Bylaws) only such business shall be conducted, and
only such proposals shall be acted upon, as shall have been brought before the
meeting (a) by, or at the direction of, a majority of the directors, or (b) by
any stockholder the Corporation who complies with the notice procedures set
forth in this Article Thirteenth. For a proposal to be properly brought before
an annual meeting by a stockholder, the stockholder must have given timely
notice thereof in writing to the Secretary of the Corporation. To be timely, a
stockholder's notice must be delivered to, or mailed by United States mail,
postage prepaid and received at, the principal executive offices of the
Corporation (i) with respect to a proposal to be considered at an annual meeting
of stockholders, not later than seventy-five (75) days prior to the first
anniversary of the preceding year's annual meeting (or, if the date of the
annual meeting is changed by more than twenty (20) days from such anniversary
date, not later than ten (10) days after the date the Company first mails to
stockholders of the Company notice of the date of the annual meeting), and (ii)
with respect to a proposal to be considered at a special meeting of
stockholders, not later than ten (10) days after the date the Company first
mails to stockholders of the Company notice of the date of the special meeting.

2. A stockholder's notice to the Secretary must set forth as to each proposal
the stockholder desires to bring before the stockholders' meeting (a) a brief
description of such proposal and the reasons supporting such proposal, (b) a
representation that the stockholder (i) is a holder of record of stock of the
Corporation entitled to vote at such meeting, (ii) will continue to hold such
stock through the date on which the meeting is held, (iii) intends to appear in
person or by proxy at the meeting to make such proposal, and (c) any financial
interest of the stockholder in such proposal.

3. The presiding officer of the stockholders' meeting shall determine and
declare at the stockholders' meeting whether the stockholder proposal was made
in accordance with the terms of this Article Thirteenth. If the presiding
officer determines that a stockholder proposal was not made in accordance with
the terms of this Article Thirteenth, he or she shall so declare at the
stockholders' meeting and any such proposal shall not be acted upon at the
stockholder's meeting.

E-1
<PAGE>

EXHIBIT F

PROPOSAL 8:

Resolved, that the Certificate of Incorporation of the Corporation, as
amended, be further amended by the addition of a new Article Fourteenth which
shall be and read in its entirety as follows:

"FOURTEENTH: Notwithstanding any other provision of this Certificate of
Incorporation or the Bylaws of the Corporation (and in addition to any other
vote that may be required by law, the Certificate of Incorporation or the Bylaws
of the Corporation), the affirmative vote of the holders of shares entitled to
cast at least two-thirds of the votes represented by the shares of all classes
of stock of the Corporation entitled to vote generally in elections of
directors, considered for purposes of this Article FOURTEENTH as one class,
shall be required to amend, alter, change, repeal or adopt any provision
inconsistent with Article TENTH, ELEVENTH, TWELFTH, THIRTEENTH or this Article
FOURTEENTH.

F-1
<PAGE>

PROXY

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF NOBEL EDUCATION DYNAMICS, INC.

The undersigned hereby appoints A.J.Clegg, Yvonne DeAngelo and Barry S. Swirsky
proxies for the undersigned, each with power to appoint his substitute, and
authorizes each of them acting alone, or together if more than one is present,
to represent and to vote, as specified below, all of the shares of the
undersigned held of record by the undersigned on May 3, 1996, at the 1996 Annual
Meeting of Stockholders of Nobel Education Dynamics, Inc. (the "Company") on
June 18, 1996, and at all adjournments thereof, on the matters set forth herein
and in the discretion of the proxies for the transaction of such other business
as may come before the meeting.

_______________________________________

Your name should appear exactly as your
name appears in the space at the left.
For joint accounts, any co-owner may
sign. When signing in a fiduciary
or representative capacity, please give
your full title as such. If a
corporation or partnership, sign in
full corporate or partnership name
by authorized officer or partner

Date:____________________________, 1996

1. ELECTION OF EIGHT DIRECTORS TO SERVE FOR ONE, TWO OR THREE YEAR TERMS, AS
INDICATED BELOW (unless if Proposal 4 is not approved, in which case election
of all directors shall be for one year terms):

[_] FOR all nominees listed below for [_] WITHHOLD AUTHORITY to vote for all
terms indicated nominees listed below
(except as marked to the contrary
below):

<TABLE>
<CAPTION>
Directors to be elected to serve Directors to be elected to serve Directors to be elected to serve
until the 1997 Annual Meeting: until the 1998 Annual Meeting: until the 1999 Annual Meeting:
<S> <C> <C>
John R. Frock Morgan R. Jones Edward Chambers
Janet L. Katz John H. Martinson A. J. Clegg
Eugene E. Monaco Peter H. Havens
</TABLE>

INSTRUCTION: To withhold authority to vote for any
individual nominee, print that nominee's name in the
following space:

______________________________________________________________

2. RATIFICATION OF THE SELECTION OF COOPERS & LYBRAND, L.L.P. AS THE COMPANY'S
INDEPENDENT AUDITORS FOR FISCAL YEAR 1996: