| Phoenix Preschool Holdings, Inc. | |||
| Proposed Ticker: | FENX | 150 East 58th Street, 31st Floor | |
| Exchange: | NASDAQ-Small Cap Market | New York, NY 10155 | |
| Industry: | Service (SIC Code 8351) | (212) 826-6131 | |
| Type of Shares: | Common Shares | Filing Date: | 7/16/97 | |
| U.S. Shares Filed: | 1,300,000 | Filing Price: | $4.20 | |
| Non-U.S. Shares Filed: | 0 | Offering Amount: | $5,460,000 | |
| Primary Shares: | 1,300,000 | Expenses: | $626,000 | |
| Secondary Shares: | 0 | Shares Out After: | 2,900,000 |
| Manager | Tier | Phone |
| Maidstone Financial, Inc. | Lead Manager | (800) 832-8830 |
| Issuer's Law Firm: | Blank, Rome, Comisky & McCauley |
| Bank's Law Firm: | Gersten, Savage, Kaplowitz & Curtin |
| Auditor: | BDO Seidman |
| Registrar/Transfer Agent: | Continental Stock Transfer & Trust Co |
Dollar amounts in U.S. millions except for per share data | |||||
| 9 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 6/30/96 | 3/31/97 | 3/31/96 | 3/31/97 | ||
| Revenue: | $2.82 | $3.80 | $1.82 | Assets: | $2.92 |
| Net Income: | -$0.20 | -$0.16 | -$0.16 | Curr Assets: | |
| EPS: | -$0.16 | -$0.10 | -$0.16 | Liabilities: | $2.67 |
| Prior EPS: | $0.32 | -$0.06 | Curr Liabilities: | ||
| Cash Flow/Oper: | -$0.06 | Equity: | $0.25 | ||
| Cash Flow/Fin: | Cash: | ||||
| Cash Flow/Inv: | |||||
| Business Description |
| The company provides for-profit child care through 22 child care centers located in Florida, Georgia and North Carolina. Center-based child care and preschool educational services are provided five days a week throughout the year to children between the ages of six weeks and 12 years. As of June 30, 1997, the Company had approximately 2,285 children enrolled in its centers, which had licensed capacity of 3,028 (full and part-time). All of the Company's child care centers are operated under the "Phoenix Preschool Education Centers, Inc." name. The Company's centers are primarily located on free-standing sites in suburban residential areas and/or near military installations, each with substantial preschool populations.The Company emphasizes the recruitment, selection and ongoing training of its child care center directors. Within a framework of centralized financial and quality controls, the Company grants significant authority over center operations to its center directors and rewards directors and assistant directors on an incentive basis, tied to individual center performance. |
| Competition |
| Competition for attracting and maintaining student enrollment among child care facilities is significant. It is estimated that there are approximately 100,000 licensed facilities for day care/preschool services across the United States; nearly 2,800 of which are owned by the five largest day care/preschool firms, including Kindercare Learning Centers, Inc. and La Petite, Inc. Additional competition comes from small individually owned facilities, small at-home sites and many religious/church sponsored child care, day care or preschool centers. While several of the large national chains have capital and financial resources significantly greater than those of the Company, many of the small religious and other non-profit operated centers benefit from significantly lower, if any, rental costs, and receive private and/or community contributions to subsidize their operating expenses. Curricula are also easily duplicated and are difficult to protect in any meaningful proprietary sense. The Company believes that it has successfully competed in its markets by maintaining its facilities in a clean, healthy, safe and well-equipped manner, devoting significant resources to training and qualifying all of its personal and by establishing a highly developed curricula and state of the art age-appropriate learning tools while keeping its prices competitive. The Company's preschool license capacity as of June 30, 1997, was 3,028 enrolled students. The Company provides an enriching education curriculum, teaching a foreign language and basic motor skills to younger pupils. However, despite its successful, competitive, quality programs, there is no assurance that the Company can continue to do so in such a highly competitive environment. |
| Business Plan |
| The company's strategy is to offer an independently developed educational curriculum within a stimulating environment in order to provide high quality child care and to maximize development and preparation of children for school. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used to acquire additional centers, to expand sales and marketing efforts, to repay an outstanding officer note, to repay certain promissory notes issued by the company in a bridge financing completed in June, 1997, and for working capital and other general corporate purposes. |
| Name of Shareholder | % Owned Before | % Owned After |
| Michael C. Koffler | 100.00% | 57.00% |
| Officer Name | Title | Age |
| Michael C. Koffler | Chairman of the Board of Directors, Chief Executive Officer and President | 41 |
| Robert Sloop | Chief Financial Officer | 42 |
| Michael E. Brown | Field Operations Officer | 51 |
| # of Units: | 1,300,000 | |||
| Unit Ticker: | - | Unit Price: | $4.20 | |
| Warrant Ticker: | FENXW | Warrant Price: | ||
| Warrant Exercise Date: | Warrant Exercise Price: | $4.50 | ||
| Warrant Expiration Date: | ||||
| Warrant Detachable: | Yes | Warrant Detach Date: | ||
| Warrant Callable: | Yes | Warrant Call Date: |
| Unit Composition: 1 Common Share + 2 Warrants |
| Warrant Entitlement: 1/2 Common Share |
| Warrants are callable at $0.00 if the common stock trades at $8.00 for 20 of 20 consecutive trading days. |