-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, N7h1qt3S5NQxFXu8NDakwjNgXHI9OST1QT0UMIsY72HOKJQ+4IcywlyKE0JjInYU JoQjMa3OGUKZhytv7TpsZQ== 0000018497-97-000003.txt : 19970402 0000018497-97-000003.hdr.sgml : 19970402 ACCESSION NUMBER: 0000018497-97-000003 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970401 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CENCOR INC CENTRAL INDEX KEY: 0000018497 STANDARD INDUSTRIAL CLASSIFICATION: PERSONAL CREDIT INSTITUTIONS [6141] IRS NUMBER: 430914033 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-03417 FILM NUMBER: 97572048 BUSINESS ADDRESS: STREET 1: 1100 MAIN STREET SUITE 2350 STREET 2: P O BOX 26098 CITY: KANSAS CITY STATE: MO ZIP: 64196-6098 BUSINESS PHONE: 8162219744 MAIL ADDRESS: STREET 1: P O BOX 26098 STREET 2: 1100 MAIN STREET, SUITE 2350 CITY: KANSAS CITY STATE: MO ZIP: 64196 FORMER COMPANY: FORMER CONFORMED NAME: ALLIED SERVICE INC DATE OF NAME CHANGE: 19680709 10-K 1 ________________________________________________________________ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K Annual Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 (fee required) For the Year Ended December 31, 1996 Commission file number 0-3417 CENCOR, INC. (Exact name of registrant as specified in its charter) 1100 Main Street, City Center Square, Suite 416A P.O. Box 26098 Kansas City, MO 64196-6098 Telephone (816) 221-5833 Incorporated in the State of Delaware 43-0914033 (I.R.S. Employer Identification No.) Securities registered pursuant to Section 12(g) of the Act: TITLE OF CLASS Regular Common Stock, $1.00 par value Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ___ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by references in Part III of this Form 10-K or any amendment to this Form 10-K.{} Yes X No ___ Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d), of the Securities Exchange Act of 1934 subsequent to distribution of securities under a plan confirmed by a court: Yes X No ___ Indicate the number of shares outstanding of each of the issuer's classes of Common Stock, as of March 10, 1997. 1,453,617 Shares of Common Stock, $1.00 par value Market value at March 10, 1997 was $10,720,425 Documents incorporated by reference--None _________________________________________________________________ CENCOR, INC. FORM 10-K YEAR ENDED DECEMBER 31, 1996 INDEX Item Page PART I 3 Item 1. Business 3 Item 2. Properties 3 Item 3. Legal Proceedings 3 Item 4. Submission of Matters to a Vote of Security Holders 4 PART II 5 Item 5. Market for Registrant's Common Stock and Related Stockholder Matters 5 Item 6. Selected Financial Data 6 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 7 Item 8. Financial Statements and Supplementary Data 12 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 27 PART III 28 Item 10. Directors and Executive Officers of the Registrant 28 Item 11. Executive Compensation 29 Item 12. Security Ownership of Certain Beneficial Owners and Management 32 Item 13. Certain Relationships and Related Transactions 33 PART IV 35 Item 14. Exhibits, Financial Statements Schedules, and Reports on Form 8-K 35 PART 1 Item 1. Business CenCor, Inc. was incorporated under the laws of Delaware on May 27, 1968. Prior to June 30, 1995, CenCor, was engaged in the consumer finance business through its wholly-owned subsidiary, Century Acceptance Corporation ("Century"). As used herein, the term "the Company" refers to CenCor and Century collectively. Effective June 30, 1995, substantially all of the assets of Century were sold. For additional information regarding the sale of Century, see "Management's Discussion and Analysis of Financial Condition and Results of Operations--Financial Conditions--Sale of Century". The Company has not conducted on-going operations since the sale of its consumer finance business and is in the process of liquidation. On September 12, 1996, the Company's stockholders approved a Plan of Dissolution and Liquidation (the "Plan of Liquidation") which the Board of Directors submitted for stockholder approval at the Company's annual meeting of stockholders. CenCor is expected to be fully liquidated by October 1999. See "Management's Discussion and Analysis of Financial Condition and Results of Operation--Financial Condition-- Plan of Liquidation". As of December 31, 1995, CenCor's liabilities included outstanding non-interest bearing Convertible Notes payable July 1, 1999 (the "Convertible Notes") in the principal amount of $11,449,771. Effective April 1, 1996, CenCor converted these Convertible Notes into shares of CenCor's common stock at a ratio of one share of common stock for each $20 principal amount of Convertible Notes. As a result of this conversion, the holders of the Convertible Notes were entitled to be issued 572,554 shares of CenCor common stock upon surrender of their Convertible Notes. As of March 10, 1997, 537,760 shares have been issued and are outstanding as a result of the surrender of Convertible Notes. Except for the cover page of this report, which reflects the fact that 1,453,617 shares have actually been issued, the issued and outstanding share amounts reflected in this report and in the December 31, 1996 and December 31, 1995 financial statements included herein are treated as though all 572,554 shares have been issued and are outstanding as a result of the conversion of the Convertible Notes. Item 2. Properties Since the sale of its consumer finance business, the Company's need for office space has decreased significantly. The Company currently subleases approximately 800 sq. feet of office space on a month to month basis (see "Certain Relationships and Related Transactions"). The Company believes that its office space is adequate for its needs. Item 3. Legal Proceedings As more fully discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 1995, Century was a defendant in two Alabama state-wide class action lawsuits. While Century denied any wrong-doing and believed that the claims of the plaintiffs in these separate actions were without merit, Century settled these matters to avoid the time, expense and uncertainty of litigation. In Princess Nobels vs. Associates Corporation of North America, et al., Century agreed to refund to all class members who did not opt-out of the settlement 1 1/2 times the premiums received in payment of non-filing insurance. Class members consist of all persons who, from on or after May 15, 1990 to July 20, 1996, entered into loan agreements with Century within the State of Alabama which were secured by goods and who were charged non- filing insurance in connection therewith. Century has established a fund containing approximately $150,000 for distributions pursuant to the settlement. In Dorothy McCurdy, et al. vs. American General Finance, Inc., Century has agreed to refund to all class members who did not opt-out of the settlement 40% of all credit property insurance premiums received from such persons. Class members consist of all persons who from on or after April 13, 1991 through August 23, 1996, entered into loan agreements with Century within Alabama under which Century imposed a charge for credit property insurance. Century has established a fund containing approximately $95,000 for distributions pursuant to the settlement. Century also agreed to pay approximately $50,000 toward the administrative costs of the settlements. Pursuant to both settlements, class members who do not opt-out will be barred from seeking further relief on any of the claims. Class members who opt-out may pursue their claims individually. While the Company is unable to predict the extent to which class members who opt-out will pursue their own claims, the Company does not believe that the aggregate effect of the individual claims will be material to the Company's consolidated financial statements. Item 4. Submission of Matters to a Vote of Security Holders No matter was submitted to a vote of security holders during the fourth quarter of the registrant's fiscal year ended December 31, 1996. (The remainder of this page is intentionally blank.) PART II Item 5. Market for Registrant's Common Stock and Related Stockholder Matters CenCor's common stock is quoted on the OTC Bulletin Board under the symbol CNCR. The range of high and low sales price as quoted on the OTC Bulletin Board for each quarter of 1995 and 1996 is as follows:
1995 1996 Quarter Ended High Low High Low March 31 5/8 5/8 3 3 June 30 3 3 6 6 September 30 4-3/8 4-3/8 6-1/2 6-1/2 December 31 3-1/2 3-1/2 6-5/8 6-5/8
The quotations from the OTC Bulletin Board reflect inter-dealer prices without retail mark-up, mark-down, or commission and may not represent actual transactions. On March 10, 1997, the quoted bid price of the common stock on the OTC Bulletin Board was $7.375. At March 10, 1997, CenCor had approximately 1,034 shareholders of record. No dividends have been paid on the common stock. (The remainder of this page is intentionally blank.) Item 6. Selected Financial Data December 31, December 31, 1996 1995 Net Assets in Liquidation: Cash and cash equivalents $ 14,513,000 $ 22,439,000 Other assets 10,320,000 11,933,000 Total Assets 24,833,000 34,372,000 Accounts payable and accrued liabilities 648,000 3,200,000 Income taxes payable 1,110,000 759,000 Long-term debt 5,681,000 12,303,000 Total Liabilities 7,439,000 16,262,000 Net assets in liquidation $17,394,000 $ 18,110,000 Number of common shares outstanding 1,488,411 1,488,411 Net assets in liquidation per $ 11.69 $12.17 Change in Net Assets in Liquidation for the year ended December 31, 1996*: Income from liquidating activities $ 2,635,000 Expenses from liquidating activities 3,351,000 Decrease in net assets in liquidation $ (716,000)
______________ *As discussed in PART 1, Item 1, "Business," the Company adopted liquidation basis accounting as of December 31, 1995 and therefore prior year operating results are not comparable Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations Financial Condition Sale of Century Effective June 30, 1995, Century consummated the sale of its consumer finance business to Fidelity Acceptance Corporation, a subsidiary of the Bank of Boston Corporation. Under the terms of the sale, Century received $128.7 million for substantially all of its assets. In accordance with the provisions of the sales agreement, $5 million of the sale proceeds were placed in escrow to secure certain indemnification obligations of the Company that expire on July 1, 1998. As of March 10, 1997 the buyer has made one claim for $40,000 against the escrow and has notified the Company of other claims which may be asserted against the escrow balance. Management does not believe the amount of the other claims, if any, will be material to the consolidated financial statements. Conversion of Convertible Notes and Retired Stock On December 31, 1995, CenCor had outstanding non-interest bearing convertible notes due July 1, 1999 (the "Convertible Notes") in the principal amount of $11,449,771. Effective April 1, 1996, CenCor converted these Convertible Notes into shares of CenCor's common stock at a ratio of one share of common stock for each $20 principal amount of Convertible Notes. As a result of this conversion, the holders of the Convertible Notes were entitled to be issued 572,554 shares of CenCor common stock upon surrender of their Convertible Notes. As of March 10, 1997, 537,760 shares have been issued and are outstanding as a result of the surrender of Convertible Notes. In May 1996 CenCor received into its treasury 324,641 shares of CenCor common stock in settlement of a claim against the Estate of Robert F. Brozman and the related Robert F. Brozman Trust. The issued and outstanding share amounts reflected in the accompanying financial statements reflect the receipt and retirement of these shares. Long - Term Debt On August 19, 1996 CenCor offered to redeem all of its outstanding Non-Convertible Notes due July 1, 1999 at a cash price equal to 74% of their principal amount. Prior to the offer, the principal balance of the Non-Convertible Notes was $17,174,656. CenCor redeemed outstanding Non-Convertible Notes in the principal amount of $9,965,425 as of the November 18, 1996 offer expiration date at a cost of $7,374,415. The Non- Convertible Notes not tendered by the noteholders remain outstanding and are expected to be paid in full at the stated maturity date of July 1, 1999. However, there can be no assurance that intervening events will not affect CenCor's ability to fully discharge this obligation at that time. Plan of Liquidation With the sale of its consumer finance business, CenCor's business purpose no longer exists. For that reason, CenCor's Board of Directors adopted a resolution on January 22, 1996 that CenCor be liquidated and that the Plan of Liquidation be submitted to the stockholders for approval. The Company's stockholders approved the Plan of Liquidation at the Company's annual meeting of stockholders held on September 12, 1996 and a Certificate of Dissolution was subsequently filed with the State of Delaware. Under Delaware Law, CenCor will continue as a corporate entity for three years after the effective date of the dissolution (October 1, 1996) or for such longer period as the Delaware Court of Chancery directs in its own discretion, for the purpose of prosecuting and defending suits by or against CenCor and winding up the business and affairs of CenCor, but not for the purpose of continuing the business of CenCor. The Plan of Liquidation provides that the implementation of the plan is intended to be completed by October 1, 1999. During this three year period, CenCor will not engage in any business activities, except for preserving the value of its assets, adjusting and winding up its business and affairs, and distributing its assets in accordance with the Plan of Liquidation. CenCor's debts and liabilities, whether fixed, conditioned or contingent, will either be paid as they become due or provided for. At such time as the Board has determined that all claims and liabilities have been identified and paid or provided for, which CenCor does not expect to occur prior to 1999, CenCor will distribute all funds resulting from CenCor's liquidation to the stockholders in accordance with the respective rights of each. The proportionate interests of the respective stockholders in the assets of CenCor will be fixed on the basis of their ownership of the outstanding shares of CenCor on a record date to be determined by the Board. During the period of liquidation, CenCor's directors and officers are authorized to implement and carry out the provisions of the Plan of Liquidation and to receive compensation for their services. Assuming CenCor had fully liquidated and distributed its assets by December 31, 1996 and assuming further that the Company's actual realizable value of its assets and liabilities is identical to the Company's estimated realized value of these items, CenCor's stockholders would have received $17,394,000 in distributions or approximately $11.69 per share, less costs to liquidate. The actual amount to be received upon complete liquidation may be adversely affected by claims arising from the indemnification obligations resulting from the sale of Century's assets, unanticipated tax liabilities, or other unforeseen factors. Concorde Career Colleges, Inc. Agreements At December 31, 1996, the Company held a junior secured debenture (the "Debenture") of Concorde Career Colleges, Inc. ("Concorde") in the principal amount of approximately $2.4 million and 260,385 shares of Concorde's cumulative preferred stock (the "Preferred Stock"). Further, the Company held an unsecured debt of Concorde in the principal amount of approximately 190,000 (the "Unsecured Debt"). The Debenture, which was to have matured on July 31, 1997, called for principal and interest payments commencing June 30, 1996 based on a 10-year amortization schedule. Interest on the Debenture compounded and accrued quarterly at a variable rate not to exceed 12%. The Debenture further called for an additional contingent payment at the maturity of the Debenture in an amount equal to 25% of the amount by which the "market capitalization" of Concorde exceeded $3.5 million on August 31, 1997. The Preferred Stock, $.10 par value, had a per share liquidation preference of $10.00 per share. Cumulative quarterly dividends accrued at a rate equal to 73% of the then current interest rate on the Debenture. Dividends were to have accrued until such time as the Debenture was paid in full. While Concorde could redeem the Preferred Stock in whole or in part at liquidation value plus accrued cumulative dividends, the Preferred Stock did not provide for mandatory redemption. On December 30, 1996, CenCor and Concorde amended the Restructuring, Security and Guaranty Agreement (the "Fourth Amendment") between the parties to facilitate the early redemption of the Preferred Stock and payment in full of all of the obligations of Concorde to CenCor. The Fourth Amendment provided that if CenCor received a "repayment price" of approximately $4.8 million prior to February 28, 1997, inclusive of any Preferred Stock redemption payments and debt service payments on the Debenture subsequent to September 30, 1996, that Debenture and the Unsecured Debt would be retired and the Preferred Stock redeemed in full. In February 1997, CenCor retired in full of all of Concorde's debt obligations to CenCor and redeemed in full of all of the remaining shares of Preferred Stock in accordance with the terms of the Fourth Amendment. In exchange, CenCor agreed to release Concorde from all liabilities and obligations, except its continuing obligation to convey written- off receivables in connection with discharged interest, as described below. During 1996, CenCor received $452,498 from Concorde in redemption of 39,615 shares of Preferred Stock and $411,890 in payments from Concorde on the Debenture. In 1993 and 1994, Concorde agreed to assign certain charged-off receivables to CenCor in full payment of the accrued interest due on the Junior Secured Debenture through December 31, 1993 and 1994, respectively. The receivables, which consist of account and notes receivable from students who attended schools operated by Concorde or its subsidiaries, were assigned to CenCor without recourse with CenCor assuming all risk of non-payment of the receivables. The agreement with Concorde grants CenCor limited rights of substitution until such time as it collects full payment of the accrued interest, exclusive of out-of-pocket collection fees and expenses paid to third parties. CenCor has engaged a collection agent to pursue recovery of such receivables assigned to the Company. As of December 31, 1996, CenCor has collected approximately $672,000 of the total $1,057,000 discharged interest due from the charged-off receivables. Collections in 1996 and 1995 were approximately $334,000 and $338,000 (inclusive of $50,000 received in 1994), respectively. Assets and Liabilities During the Liquidation Period Following the sale of its consumer finance business, the Company's assets consist primarily of cash and cash equivalents, the Concorde Debenture, Preferred Stock and Unsecured Debt, (as previously discussed, the Concorde assets were liquidated on February 25, 1997), certain previously charged-off receivables received in payment of accrued interest on the Debenture, and the escrow account established to secure the indemnification obligations of the Company to the buyer of the consumer finance business. The Company's remaining liabilities consist primarily of the amounts due to the holders of its non-tendered Non-Convertible Notes, accounts payable, and other accrued liabilities, including accrued income taxes. As a result of being in the process of liquidation, the Company is required to adopt the liquidation basis of accounting. Generally accepted accounting principles require the adjustment of assets and liabilities to estimated fair value under the liquidation basis of accounting. For information concerning the estimated fair values given these items by the Company and the methods and assumptions used to arrive at such values, see the Company's Financial Statements and the notes thereto. Results of Operations During the year ended December 31, 1996, the Company's sources of income consisted primarily of investment income, interest income on the Debenture, and collections from the Concorde charged-off receivables received in payment of accrued interest on the Debenture. CenCor also recognized a loss from early retirement of a portion of its long-term debt and a gain on the redemption of the Concorde Preferred Stock. The Company's expenses during the year ended December 31, 1996 consisted mainly of salaries, accretion of interest on the Company's long-term debt, professional and consulting fees, and other liquidating expenses. The Company recorded an income tax expense as a result of the taxable gain from the retirement of CenCor's Non-Convertible Notes as previously discussed and an increase in taxable income due to a reduction the Company's net operating loss ("NOL") carryforward. See "Liquidity and Capital Resources - Internal Revenue Service Examinations and Potential California Sales Tax Assessment" for a further discussion of the NOL carryforward. Activities During Liquidation Period The Company's activities during the period of liquidation will focus on the collection of various amounts owed to it, including the previously charged-off Concorde receivables received in payment of accrued interest. The Company will also closely monitor claims rising from indemnification obligations to the buyer of Century in order to maximize the value of the escrow fund established as a result of the sale. Until the Company's long-term debt becomes payable and distributions are made to stockholders, management expects to invest the available proceeds from the sale of Century and the Company's other cash in short- term government or government agency instruments. The Company's expenses during the period of liquidation are expected to consist mostly of salaries, professional fees, stockholder communication expenses, income taxes and other liquidating expenses. The Company will be required to satisfy the balance of the non- tendered Non-Convertible Notes together with all other liabilities prior to any distribution on its outstanding common stock. Regulation During the Liquidation Because of the sale of Century's consumer finance business, CenCor may be an "investment company" as defined in the Investment Company Act of 1940 (the "1940 Act"). The 1940 Act generally requires investment companies to register with the Securities and Exchange Commission after which their capital structure, securities issuances, investments and transactions with affiliates, along with numerous other activities would become subject to extensive regulation. The 1940 Act does not, however, require an investment company to register if its only activities are those "merely incidental to its dissolution". CenCor believes that in light of the dissolution exception from registration under the 1940 Act, CenCor is not required to register under such act. Surrender of Certificates for Common Stock At such time as the respective interest of the stockholders are fixed on the basis of the ownership of their outstanding shares of common stock of the Corporation on a record date determined by the Board (the "Record Date"), it is anticipated that the stock transfer books of CenCor will be closed, no further transfers will be recorded on CenCor's books and no further stock certificates will be issued, other than replacement certificates. All distributions from CenCor on or after the Record Date will be made to stockholders according to their stockholdings as of the Record Date. As soon as practicable after the determination of the Record Date, stockholders will be advised of the procedures for surrendering certificates representing their shares of common stock. Stockholders should not forward their stock certificates before receiving those instructions. Distributions for stockholders who have not surrendered their stock certificate may be held for such stockholders, without interest, until the surrender of their certificates (subject to the laws relating to unclaimed property). Liquidity and Capital Resources Capital Obligations The Company has no significant obligations for capital purchases. Defaults on Long-Term Debt The Company believes that it is in compliance with all covenants and terms under the indenture for the Non-Convertible Notes. Internal Revenue Service Examination and Potential California Sales Tax Assessment The Company's 1990, 1991, and 1992 federal income tax returns have been examined by the IRS. The IRS has proposed adjustments to increase taxable income in 1991 which the Company is in the process of appealing. Management believes that an adequate reserve has been provided at December 31, 1996 and therefore the ultimate disposition of the IRS examination will not have a material effect on the financial position of the Company. Charter Equipment Leasing Corp. ("Charter"), a former subsidiary of CenCor, sold substantially all of its assets in 1992 and dissolved in 1994. In connection with the sale of Charter's assets, the California Board of Equalization (the "Board of Equalization") issued a Notice of Determination in April 1996 (revising a Notice of Determination previously issued in January 1996) for sales tax, interest and penalties in the amount of $5,362. In March 1997, the Company settled the sales tax assessment for approximately $6,000. However, the Board of Equalization may still attempt to assert a claim against the buyer of Charter's assets based upon successor liability for sales taxes from the 1992 transaction. If the buyer is assessed sales taxes, the buyer may attempt to assert an indemnification claim against CenCor. (The remainder of this page is intentionally blank.) Item 8. Financial Statements and Supplementary Data INDEX TO FINANCIAL STATEMENTS Page CenCor, Inc. Report of Independent Auditors 13 Audited Consolidated Financial Statements Consolidated Statement of Net Assets in Liquidation 14 Consolidated Statement of Changes in Net Assets in Liquidation 15 Consolidated Statement of Operations 16 Consolidated Statement of Stockholders' Equity 17 Consolidated Statement of Cash Flows 18 Notes to Consolidated Financial Statements 20 Report of Independent Auditors The Board of Directors and Stockholders CenCor, Inc. We have audited the accompanying consolidated statements of net assets in liquidation of CenCor, Inc. (the Company) as of December 31, 1996 and 1995, the related statement of changes in net assets in liquidation for the year ended December 31, 1996, and the related consolidated statements of operations, stockholders' equity and cash flows for the year ended December 31, 1995. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. As described in Note 1 to the financial statements, as a result of the Board of Directors' intent to liquidate effective December 31, 1995, the Company changed its basis of accounting from the going-concern basis to the liquidation basis. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets in liquidation of CenCor, Inc. as of December 31, 1996 and 1995, the changes in net assets in liquidation for the year ended December 31, 1996 and the consolidated results of its operations and its cash flows for the year ended December 31, 1995, in conformity with generally accepted accounting principles applied on the basis described in the preceding paragraph. Ernst & Young LLP March 12, 1997 Kansas City, Missouri
CenCor, Inc. (In Process of Liquidation) Consolidated Statement of Net Assets in Liquidation December 31, December 31, 1996 1995 Assets: Cash and cash equivalents $ 14,513,000 $ 22,439,000 Other assets 10,320,000 11,933,000 Total assets 24,833,000 34,372,000 Liabilities: Accounts payable and accrued liabilities 648,000 3,200,000 Income taxes payable 1,110,000 759,000 Long-term debt 5,681,000 12,303,000 Total liabilities 7,439,000 16,262,000 Net assets in liquidation $ 17,394,000 $ 18,110,000 Number of common shares outstanding 1,488,411 1,488,411 Net assets in liquidation per share $ 11.69 $12.17 See accompanying notes.
CenCor, Inc. (In Process of Liquidation) Consolidated Statement of Changes in Net Assets in Liquidation For the Year Ended December 31, 1996 Net assets in liquidation, December 31, 1995 $18,110,000 Income from liquidating activities: Investment income 1,655,000 Other interest income 903,000 Gain on extinguishment of debt 208,000 Loss on liquidation of other assets (131,000) 2,635,000 Expenses from liquidating activities: Salaries and related benefits 457,000 Interest expense 1,052,000 Professional fees 242,000 Other expenses 325,000 Income tax 1,275,000 3,351,000 Decrease in net assets in liquidation (716,000) Net assets in liquidation, December 31, 1996 $ 17,394,000 See accompanying notes.
CenCor, Inc. (In Process of Liquidation) Consolidated Statement of Operations For the Year Ended December 31, 1995 Income $ 1,220,000 Expenses: Salaries and other expenses 2,822,000 Interest expense, net 2,260,000 Operating loss (3,862,000) Non-operating income 3,087,000 Loss before discontinued operations (775,000) Discontinued operations: Loss from operations, net of $0 taxes (5,330,000) Gain on disposal, net of $1,100,000 taxes 24,047,000 Income from discontinued operations 18,717,000 Net income $ 17,942,000 Weighted average common and common equivalent shares outstanding 1,813,052 Earnings per share of common stock and common equivalent shares of stock: Loss per share before discontinued operations $ (0.43) Earnings per share from discontinued operations 10.33 Earnings per share from net income $ 9.90 See accompanying notes.
CenCor, Inc. (In Process of Liquidation) Consolidated Statement of Stockholders' Equity Retained Net Assets Paid-in Earnings in Liqui- Shares Amount Capital (Deficit) dation Total Balance at December 31, 1994 1,240,498 $1,241,000 $2,805,000 $(11,273,000) $ -- (7,277,000) Net income -- -- -- 17,942,000 -- 17,942,000 Shares re- ceived in settlement (324,641) (325,000) (734,000) (1,428,000) -- (2,487,000) Balance at December 31, 1995 prior to adoption of liquida- tion basis of accounting 915,857 916,000 2,071,000 5,241,000 -- 8,228,000 Adoption of liquidation basis of accounting 572,544 (916,000) (2,071,000) (5,241,000) 18,110,000 9,882,000 Net assets in liquidation at December 31, 1995 1,488,411 $ -- $ -- $ -- $18,110,000 $18,110,000 See accompanying notes.
CenCor, Inc. (In Process of Liquidation) Consolidated Statement of Cash Flows For the Year Ended December 31, 1995 Operating activities: Net income $ 17,942,000 Adjustment to reconcile net income to net Cash used in operating activities: Gain on disposal (24,047,000) Cash used in discontinued operations 4,561,000 Other changes in assets and liabilities, net 1,370,000 Total adjustments (18,116,000) Net cash used in operating activities (174,000) Investing and other activities: Proceeds from sale of discontinued operations 123,710,000 Capital expenditures, net (35,000) Net cash provided by investing and other activities 123,675,000
CenCor, Inc. (In Process of Liquidation) Consolidated Statement of Cash Flows (continued) For the Year Ended December 31,1995 Financing activities: Payments of long-term debt $(102,095,000) Net cash used in financing activities (102,095,000) Net increase in cash and cash equivalents 21,406,000 Cash and cash equivalents at beginning of year 1,033,000 Cash and cash equivalents at end of year $ 22,439,000 Supplemental disclosures of cash flow information: Cash paid during the year for: Interest $ 5,698,000 Income taxes $ 356,000 See accompanying notes.
Notes to Consolidated Financial Statements December 31, 1996 and 1995 1. Summary of Significant Accounting Policies Basis of Presentation and Plan of Liquidation The accompanying consolidated financial statements include accounts of CenCor, Inc. and its wholly-owned subsidiary Century Acceptance Corporation ("Century") (collectively, "the Company"). Effective June 30, 1995, the Company sold substantially all of the assets of Century its then only operating subsidiary. Since the date of the sale of Century, the Company has had no ongoing operations. As a result, the Company has changed its basis of accounting from going concern basis to liquidation basis. On September 12, 1996, the Company's stockholders approved a Plan of Dissolution and Liquidation (the "Plan of Liquidation") which the Company's Board of Directors submitted for stockholder approval at the company's annual meeting of stockholders. In connection with the Plan of Liquidation, the officers and directors of CenCor are authorized to (i) dissolve CenCor, including the execution and filing of a Certificate of Dissolution with the Secretary of State of the State of Delaware, (ii) wind up CenCor's affairs, including satisfaction of all liabilities and long-term debt of CenCor and (iii) liquidate CenCor's assets on a pro rata basis in accordance with the respective interests of its common stockholders. CenCor is expected to be fully liquidated by October 1999. Generally accepted accounting principles require the adjustment of assets and liabilities to estimated fair value under the liquidation basis of accounting. Accordingly, the statements of net assets in liquidation at December 31, 1996 and 1995, reflect assets and liabilities on this basis. Adjustments for changes in estimated liquidation value are recognized currently. Estimated costs of liquidation have not been provided since such costs are not able to be estimated. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles under the liquidation basis of accounting requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ significantly from those estimates. Cash and Cash Equivalents Cash and cash equivalents include cash, money market accounts, and short-term government or government agency instruments. Fair Values of Assets and Liabilities The following methods and assumptions were used by the Company in estimating the liquidation value of its assets and liabilities: Cash and cash equivalents: The carrying amounts reported in the statement of net assets in liquidation for cash and cash equivalents approximate their fair value. Concorde Career Colleges, Inc. ("Concorde") Securities: Other assets at December 31, 1996 include the fair value of CenCor's investments in Concorde which is based upon the terms of repayment as defined in the December 30, 1996 agreement (the "Fourth Amendment") with Concorde. See Note 4. At December 31, 1995 the Concorde investments are valued using discounted cash flow analysis, based on an estimated discount rate commensurate with the associated risks. Other Assets: The fair value of the Company's other assets, excluding CenCor's investment in Concorde, is estimated using discounted cash flow analysis, based on an estimated discount rate commensurate with the associated risks. 1. Summary of Significant Accounting Policies (continued) Accounts Payable and Accrued Liabilities: The carrying amount reported in the statement of net assets in liquidation for accounts payable and accrued liabilities approximates their fair value. Income Tax Payable: The carrying amount reported in the statement of net assets in liquidation approximates the fair value of taxes currently payable. Long-Term Debt: The fair value of the Company's long-term debt is estimated using discounted cash flow analyses, based on the Company's current incremental borrowing rates for similar types of borrowing arrangements (10% at December 31, 1996 and December 31, 1995). The fair value reflects a conversion of the convertible notes in accordance with the bankruptcy plan (see Note 5). Reclassifications Certain amounts in the 1995 financial statements have been reclassified to conform with the 1996 presentation. 2. Discontinued Operations Effective June 30, 1995, the Company sold substantially all of the assets of Century. The gross cash proceeds from the sale of Century were approximately $128,710,000. In accordance with the provisions of the sales agreement, $5,000,000 of the purchase price was placed in escrow to secure certain indemnification obligations of the Company to the buyer that run through July 1, 1998. Century was able to redeem all of its outstanding secured notes held by its lenders for a purchase price equal to the principal amount of the secured notes (approximately $102 million) together with interest, but without the payment of substantial prepayment premiums payable under the secured notes. The lenders also surrendered for cancellation outstanding warrants which would have allowed them to acquire up to 30% of Century. 2. Discontinued Operations (continued) The loss from operations, net of applicable income taxes, for Century is segregated as discontinued operations in the accompanying consolidated statement of operations for the year ended December 31, 1995. The net loss from discontinued operations is as follows: December 31, 1995 Revenues $ 15,714,000 Expenses (20,988,000) Other loss (56,000) Loss from discontinued operations before income taxes (5,330,000) Income taxes applicable to discon- tinued operations ----- Net loss from discontinued operations $ (5,330,000)
3. Litigation and Contingencies Century was a defendant, along with a number of other consumer finance companies, in two class action lawsuits in the State of Alabama. The suits were filed by certain alleged borrowers of the defendant creditor/lenders and assert various violations. While Century denied the allegations, Century has settled the claims, in order to avoid time, expense, and uncertainty of litigation by agreeing to pay the class-action plaintiffs $295,000, which includes certain administrative costs of the settlements of the claims. 4. Other Assets At December 31, 1996, the Company held a junior secured debenture (the "Debenture") of Concorde Career Colleges, Inc. ("Concorde") in the principal amount of approximately $2.4 million and 260,385 shares of Concorde's cumulative preferred stock (the "Preferred Stock"). Further, the Company held an unsecured debt of Concorde in the principal amount of approximately $190,000 (the "Unsecured Debt"). The Debenture, which was to have matured on July 31, 1997, called for principal and interest payments commencing June 30, 1996 based on a 10-year amortization schedule. Interest on the Debenture compounded and accrued quarterly at a variable rate not to exceed 12%. The Debenture further called for an additional contingent payment at the maturity of the Debenture in an amount equal to 25% of the amount by which the "market capitalization" of Concorde exceeded $3.5 million. The Preferred Stock, $.10 par value, had a per share liquidation preference of $10.00 per share. Cumulative quarterly dividends accrued at a rate equal to 73% of the then current interest rate on the Debenture. Dividends were to have accrued until such time as the Debenture was paid in full. While Concorde could redeem the Preferred Stock in whole or in part at liquidation value plus accrued cumulative dividends, the Preferred Stock did not provide for mandatory redemption. On December 30, 1996, CenCor and Concorde amended the Restructuring, Security and Guaranty Agreement (the "Fourth Amendment") between the parties to facilitate the early redemption of the Preferred Stock and payment in full all of the obligations of Concorde to CenCor. The Fourth Amendment provided that if CenCor received a "repayment price" of approximately $4.8 million prior to February 28, 1997, inclusive of any Preferred Stock redemption payments and debt service payments on Debenture subsequent to September 30, 1996, that Debenture and the Unsecured Debt would be retired and the Preferred Stock redeemed in full. In February 1997, CenCor retired in full of all of Concorde's debt obligations to CenCor and redeemed in full of all of the remaining shares of Preferred Stock in accordance with the terms of the Fourth Amendment. In exchange, CenCor agreed to release Concorde from all liabilities and obligations, except its continuing obligation to convey written- off receivables in connection with discharged interest, as described below. During 1996, CenCor received $452,498 from Concorde in redemption of 39,615 shares of Preferred Stock and $411,890 in payments from Concorde on the Debenture. In 1993 and 1994, Concorde agreed to assign certain charged-off receivables to CenCor in full payment of the accrued interest due on the Junior Secured Debenture through December 31, 1993 and 1994, respectively. The receivables, which consist of account and notes receivable from students who attended schools operated by Concorde or its subsidiaries, were assigned to CenCor without recourse with CenCor assuming all risk of non-payment of the receivables. The agreement with Concorde grants CenCor limited rights of substitution until such time as it collects full payment of the accrued interest, exclusive of out-of-pocket collection fees and expenses paid to third parties. CenCor has engaged a collection agent to pursue recovery of such receivables assigned to the Company. As of December 31, 1996, CenCor has collected approximately $672,000, of the total $1,057,000 discharged interest due from the charged-off receivables. Collections in 1996 and 1995 were approximately $337,000 and $338,000 (inclusive of $50,000 received in 1994), respectively. The estimated liquidation value of the Debenture, Preferred Stock, Unsecured Debt, and discharged interest was $5,092,000 at December 31, 1995. Also included in other assets at December 31, 1995 are receivables relating to a fidelity bond claim arising from a loss on fraudulent automobile contracts in 1991 and a claim against a third party. In March 1996, the Company received $875,000 from the third party in payment of the claim. In April 1996, the Company received $750,000 in payment of the fidelity bond claim. In addition, an escrow account was established in accordance with the provisions of the agreement pertaining to the sale of Century's assets. Such amount, including accrued interest ($5,277,000 and $5,028,000 at December 31, 1996 and December 31, 1995, respectively), is included in other assets. The escrow was established in order to secure certain indemnification obligations of Century and CenCor to the buyer that run through July 1, 1998. Management believes that any potential liability pertaining to these obligations would be immaterial to the accompanying financial statement. 5. Long-Term Debt Pursuant to a 1993 plan of reorganization, CenCor's noteholders received the following securities for each $1,000 aggregate amount of principal and accrued but unpaid interest at December 31, 1992: (i) $600 principal amount of non-interest bearing Non- Convertible Notes (ii) $400 principal amount of non-interest bearing Convertible Notes (iii) 5.2817 shares of CenCor common stock, par value of $1 per share The Non-Convertible Notes are non-interest bearing and will mature on July 1, 1999. On August 19, 1996, CenCor offered to retire all of its outstanding Non-Convertible Notes due July 1, 1999 at a cash price equal to 74% of their principal amount. As of December 31, 1995 and prior to the offer, the principal balance of the Non-Convertible Notes was $17,174,656. CenCor purchased and retired outstanding Non-Convertible Notes in the principal amount of $9,965,425 as of the November 18, 1996 offer expiration date at a cost of $7,374,415. At December 31, 1996, the fair value of the non-tendered Non-Convertible Notes was $5,680,770. The Notes (Convertible and Non-Convertible) were assigned a fair value of $12,303,000 at December 31, 1995. On December 31, 1995, CenCor had outstanding non-interest bearing convertible notes due July 1, 1999 (the "Convertible Notes") in the principal amount of $11,449,771. Effective April 1, 1996, CenCor converted these Convertible Notes into shares of CenCor's common stock at a ratio of one share of common stock for each $20 principal amount of Convertible Notes. As a result of this conversion, the holders of the Convertible Notes are entitled to be issued 572,554 shares of CenCor common stock upon surrender of their Convertible Notes. As of March 10, 1997, 537,760 shares have been issued and are outstanding as a result of the surrender of Convertible Notes. The conversion of these notes in satisfaction of $11,449,771 principal amount of the obligation is reflected in the financial statements and the number of outstanding shares at December 31, 1996 and 1995. 6. Other Income The Company and the Estate of Robert F. Brozman and the related Trust of Robert F. Brozman (collectively the "Brozman Estate") entered into a settlement agreement pursuant to which the claims of the Company against the Brozman Estate, including claims arising from CenCor's loss of goodwill, would be settled. Under the settlement agreement, CenCor released the Brozman Estate of all liability upon receipt of $600,000 in cash plus the transfer of shares of common stock held by the Brozman Estate in the amount of $2,487,000. In March of 1995, CenCor received the $600,000 in cash from the Brozman Estate. The Company, with the assistance of its independent financial advisor, and the Brozman Estate agreed to a value of the stock of $7.66 per share which resulted in 324,641 shares of stock being transferred to the Company. The transfer in satisfaction of the settlement agreement and the subsequent retirement of the stock is reflected in the December 31, 1995 financial statements. 7. Per Share Information The number of common shares outstanding was increased under the assumption that all 572,554 common stock shares issuable as a result of the conversion of the Convertible Notes were outstanding during the year ended December 31, 1996 and December 31, 1995. Net assets in liquidation per common share was computed by dividing net assets in liquidation by the outstanding shares of common stock at December 31, 1996 and 1995 respectively. Earnings per common share and common equivalent shares were computed by dividing net income by the average outstanding shares of stock during the year ended December 31, 1995. 8. Income Taxes The Company files a consolidated federal income tax return. A provision for income taxes of $1,275,000 was recorded during the year ended December 31, 1996. The Company's 1990, 1991 and 1992 federal income tax returns have been examined by the Internal Revenue Service (IRS). The IRS has proposed adjustments to increase taxable income in 1991 which the Company is in the process of appealing. Management believes that the ultimate disposition of the IRS examination will not have a material effect on the financial position of the Company. 9. Stock Option Plan In 1993, CenCor granted 90,000 phantom share options to certain officers of CenCor. For each option exercised, the holders were granted the right to receive a cash payment equal to the excess, if any, over $1.00 per share of the greater of (i) the closing price of the Common Stock on the NASDAQ National Market (as determined on the date the option is exercised), (ii) the stockholders' equity of CenCor at the end of its most recent fiscal quarter, or (iii) the aggregate distributions per share received by CenCor's stockholders in the event CenCor is liquidated. For the purposes of the phantom share option agreement, a merger or consolidation in which CenCor is not the surviving party or a transaction in which the CenCor stockholders receive cash or securities of another company in exchange for their CenCor shares shall be deemed to be a liquidation. The options automatically terminate (a) five years after such officer or director resigns, or is removed, or (b) on the date that said officer or director engages in certain misconduct under his employment agreement. The Company recorded a liability in the amount of $1,010,000 at December 31, 1995 for this obligation. During 1996, 65,000 phantom share options were exercised by the holders at a per share value of $11.17. The per share value represented the difference between the Company's estimated net assets in liquidation per share at December 31, 1995 and $1.00 per share. A liability for $ 287,600 has been recorded at December 31, 1996 for the remaining 25,000 phantom share options. The Company had 50,000 Stock Appreciation Rights (SARs) outstanding to certain officers of the Company at December 31, 1995. The SARs permit the holders to receive a cash payment of the excess of the fair value of Century's stock at the date of exercise over the fair value of Century's stock as of the date of grant. As a result of the sale of Century during 1995, the holders of the SARs became entitled to payment. The fair market value of Century's stock has been determined as the net proceeds from the sale less liabilities retained by Century. $505,500 of the payment due on the SARs was disbursed in January of 1996 and an additional $105,000 was disbursed in July of 1996. The remaining liability is scheduled to be paid in installments through July of 1998. The liability related to the SARs was $98,000 and $701,505 at December 31, 1996 and December 31, 1995 respectively. 10. Employee Benefit Plan The Company had a Profit Sharing Plan and 401(k) Retirement Savings Plan (the Plan). The Company terminated its Plan on September 30, 1995. No contributions were made by the Company to the Plan in 1995. At termination the account of each participant of the Plan became fully vested and nonforfeitable. On October 23, 1996 the Company received a favorable determination letter from the IRS to terminate the Plan and distribute Plan assets. The Plan assets will be distributed to the participants as indicated by the terms of the Plan. (The remainder of this page is intentionally blank.) Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. (The remainder of this page is intentionally blank.) PART III Item 10. Directors and Executive Officers of the Registrant The following tables set forth the names of the directors of the registrant and certain related information as of December 31, 1996. Each of the directors has been elected to serve until the next annual meeting of stockholders or until his successor is duly elected and qualified.
Name of Served Principal Occupation for Director Since Age Last Five Years and Directorships Jack L. Brozman 1979 46 Chairman of the Board, President and Chief Executive Officer of CenCor and Concorde since June 1991. Chief Executive Officer of Century from July 1991 to August 1992. Chairman of the Board and Treasurer, from June 1991 until July 23, 1993, and President and Director, for more than five years prior to July 23, 1993, of La Petite Academy, Inc. Director of Century and Concorde. Edward G. Bauer, Jr. 1991 68 Vice President and General Counsel of Philadelphia Electric Company for more than the five-year period prior to August 1988. Retired from this position at the end of August 1988. George L. Bernstein 1991 64 Chief Financial and Administrative Officer of Howard Fischer Associates, Inc. (executive search firm) since October 1994. Chief Operating Officer of Dilworth, Paxson, Kalish & Kauffman, Philadelphia, Pennsylvania (law firm) from November 1991 to September 1994. Director of R & B, Inc. (distributor of automotive parts). Director of Century effective April 8, 1993. Marvin S. Riesenbach 1991 67 Executive Vice President and Chief Financial Officer of Subaru of America, Inc. for more than the five years prior to October 1990. Retired from this position at the end of October 1990. Jack L. Brozman is the sole executor of the Estate of Robert F. Brozman. Director effective July 1, 1991. Member of Special and Audit Committees beginning July 1, 1991. Elected to Executive Compensation Committee on August 21, 1991.
The Board of Directors of CenCor held five meetings and acted by unanimous written consent on one occasion during the last fiscal year. Standing committees, consisting of the Special Committee and the Audit Committee, held one meeting during the last fiscal year. The Executive Compensation Committee makes salary and bonus recommendations for certain executive officers. The Audit Committee oversees the work of CenCor's independent auditors. CenCor's Board of Directors does not have a nominating committee. The Special Committee has the final authority to thoroughly investigate and report to the Board of Directors on certain matters concerning the misappropriation of CenCor's assets by CenCor's previous chairman of the board, Robert F. Brozman, or certain of his affiliated privately held companies. The Special Committee also has the power and authority to consider the adequacy of CenCor's internal controls and procedures and to investigate and report upon such other matters as the Special Committee considers appropriate. The Special Committee, the Executive Compensation Committee, and the Audit Committee are composed of Messrs. Bauer, Bernstein and Riesenbach. In addition to Jack L. Brozman, the following person also serves as an executive officer of the Company as of December 31, 1996. Name Age Principal Occupation for Last Five Years Terri Rinne 29 Vice President CenCor since July 1, 1995. Controller of CenCor from April 1994 through June 1995. Tax manager of CenCor and Century from August 1993 through March 1994. Accountant with Arthur Andersen, LLP from October 1989 through August 1993.
Disclosure of Delinquent Files Except as described below, the Company believes, based on information filed with the Company, that all reports required to be filed for the past two years with the Securities and Exchange Commission under Section 16 by the Company's executive officers, directors, and ten percent stockholders have been filed in compliance with applicable rules. The Estate of Robert F. Brozman and Jack L. Brozman failed to timely file Form 4's with respect to the transfer shares of CenCor common stock to CenCor. See "Certain Relationships and Related Transactions". A Form 5 reflecting this transaction has been filed. Item 11. Executive Compensation. Summary Compensation Table The following table sets forth information as to the compensation of the Chief Executive Officer and each of the other executive officers of CenCor and Century whose total annual salary and bonus exceeded $100,000, during the year ended December 31, 1996 for services in all capacities to CenCor and its subsidiaries in 1994, 1995, and 1996.
Long-Term Compensation Annual All Other Compensation Awards Compensation Other Annual Name and Principal Salary Bonus Compensation Options/SARs Position Year ($) ($) ($) # Jack L. Brozman, 1996 $201,900 $753,900 $279,250 Chairman of the Board and Chief Executive Officer 1995 $178,300 15,000 1994 $134,800 $25,000 Mr. Brozman also received compensation as an executive officer of Concorde. Consists of (i) installment payments received during 1996 with respect to payout received on 30,000 units of stock appreciation rights (SARs) deemed exercised during 1996 in the amount of $427,000 but payable beginning in 1996 and ending in 1998 and (ii) payout received on the exercise of phantom share options with respect to 35,000 shares of CenCor common stock. See "Executive Compensation--Option/SAR Grants in Last Fiscal Year". Represents the dollar value of in-the-money phantom share options. See "Option Exercises and Fiscal Year-End Option Value Table". See "Executive Compensation -- Option Exercises and Fiscal Year End Option Value Table". Mr. Brozman was also awarded and paid a cash bonus in 1994 of $25,000 in recognition of his excellent performance in 1993.
Option Exercises and Fiscal Year-End Option Value Table The following table provides information with respect to the named executive officers concerning options exercised during 1996 and unexercised options held as of December 31, 1996.
Value # of Securities Underlying Value of Unexercised In-the- Options Realized Unexercised Options Money Options Name Exercised ($) at FY-End at FY-End ($) Exercisable Unexercisable Exercisable Unexercisable Jack L. Brozman, 35,000 $390,950 25,000 N/A $279,250 N/A CEO Consists of phantom share options relating to CenCor common stock. Excludes $362,950 received during 1996 in installment payments with respect to SAR units deemed exercised during 1995 but payable in subsequent years. Consists of phantom share options relating to 25,000 shares of CenCor common stock which were not exercised until January 1997. Represents amount of payout received in January 1997 upon the exercise of 25,000 phantom share options.
Compensation of Directors Each non-officer/director of CenCor is paid an annual retainer of $25,000 plus a fee (based on time spent on corporate matters, including attendance at board and committee meetings) and expenses. Item 12. Security Ownership of Certain Beneficial Owners and Management The following table sets forth, with respect to CenCor common stock (the only class of voting securities), the only persons known to be a beneficial owner of more than five percent (5%) of any class of CenCor voting securities as of March 10, 1997. Names and Addresses Number of Shares and of Beneficial Owners Nature of Beneficial Ownership Percent of Class Jack L. Brozman, Trustee 272,423 18% Robert F. Brozman Trust 1100 Main St. Kansas City, Missouri 64105 A. Baron Cass III 134,392 9% 5005 LBJ Freeway Suite 1130, LB 119 Dallas, Texas 75244 Nature of ownership of securities is direct. Beneficial ownership as shown in the table arises from sole voting power and sole investment power. Does not include 34,344 shares held by Jack L. Brozman or 20,025 shares held by or for the benefit of Robert F. Brozman's other children, in which the Robert F. Brozman Trust disclaims any beneficial interest.
The following table sets forth, with respect to CenCor common stock (the only class of voting securities), (i) shares beneficially owned by all directors of the Company and nominees for director, and (ii) total shares beneficially owned by directors and officers as a group, as of March 10, 1997. Number of Shares and Name and Address Nature of Beneficial of Beneficial Owner Ownership Percent of Class Jack L. Brozman 306,767 21% Edward G. Bauer, Jr. 6,000 * George L. Bernstein --- --- Marvin S. Riesenbach --- --- Directors and Officers as a Group 312,767 21% *Less than 1% Nature of ownership of securities is indirect. Beneficial ownership as shown in the table arises from sole voting power and sole investment power. Includes 34,344 shares held by Jack L. Brozman and 272,423 shares held by the Robert F. Brozman Trust. Does not include 20,025 shares held by or for the benefit of Robert F. Brozman's other children, in which the Robert F. Brozman Trust disclaims any beneficial interest. Jack L. Brozman is the sole trustee and is also one of the beneficiaries of the Robert F. Brozman Trust.
Item 13. Certain Relationships and Related Transactions A significant portion of the Company's assets, as of December 31, 1996, consisted of debt and equity securities issued by Concorde, a business in which Jack L. Brozman holds an interest. On February 25, 1997, CenCor, Inc. (the "Company") received the final payment on a $4.8 million repayment price retiring in full of all of Concorde's debt obligations owed to the Company and redeeming in full of the Concorde Preferred Stock held by the Company. In exchange, the Company released Concorde from all liabilities and obligations under its agreements with Concorde. See "Management's Discussion and Analysis of Financial Condition and Results of Operations--Financial Condition-- Concorde Career Colleges, Inc. Agreements." The payments were received pursuant to a recently amended Restructuring, Security and Guaranty Agreement (the "Fourth Amendment") with Concorde which was negotiated by the Company's Special Committee, consisting of its outside directors. CenCor continues to hold approximately $23.4 million in previously charged-off Concorde receivables which it received in payment of accrued interest on the Debenture. Concorde assigned to CenCor the previously charged off receivables (primarily student loan promissory notes) in payment of accrued interest on the Debenture through December 31, 1994 of approximately $1 million. Provided that CenCor undertakes reasonable steps to collect the charged off receivables, CenCor has a right to substitute receivables as to which collection efforts have been made for new Concorde receivables until such time as CenCor receives cash equal to the accrued interest. Any amounts collected in excess of the accrued interest amount, apply first to reimbursing Concorde for its professional fees and then to interest and principal on the Debenture. The February 1997 release does not relieve Concorde from providing substitute student receivables received in exchange of accrued interest of which approximately $385,000 is currently outstanding. The Company currently subleases its approximately 800 sq. feet office space from Concorde on a month to month basis. The Company pays rent of $927 per month for the space. Jack L. Brozman, who is Chairman of the Board of CenCor and Century, is Chairman of the Board of Concorde. Mr. Brozman owns 171,724 shares of Concorde (2.5% of the outstanding class). As sole fiduciary for the Estate of Robert F. Brozman (the "Brozman Estate") and the Robert F. Brozman Trust (he is one of the beneficiaries of the estate and the trust), he owns 2,435,324 shares of Concorde common stock (36% of the outstanding class). The Company and the Brozman Estate have settled the claims of the Company against the Brozman Estate arising from the CIKC Loans. The Company released the Brozman Estate from all liability in exchange for $600,000 in cash plus the transfer to the Company on May 16, 1996 of 324,641 shares of CenCor common stock previously held by the Brozman Estate. Pursuant to the terms of the settlement agreement between the Company and the Brozman Estate, the shares transferred represent the number of shares of common stock which equal the aggregate of $400,000 plus one-half the amount by which the December 31, 1995 fair market value of the stock held by the Brozman Estate exceeds $400,000. The Special Committee, with the assistance of its independent financial advisor, determined that the fair market value of the CenCor common stock on December 31, 1995, for the purposes of the settlement, was $7.66 per share. PART IV Item 14. Exhibits, Financial Statements, Schedules, and Reports on Form 8-K. (a) The following documents are filed as part of this Annual Report on Form 10-K. The following Consolidated Financial Statements of CenCor, Inc. and Subsidiaries are included in Item 8: Consolidated Statement of Net Assets in Liquidation. Consolidated Statement of Changes in Net Assets in Liquidation. Consolidated Statement of Operations. Consolidated Statement of Stockholders' Equity. Consolidated Statement of Cash Flows. Notes to Consolidated Financial Statements. (i) Consolidated Financial Statement Schedules of CenCor, Inc. and subsidiaries have been omitted as not applicable or not required under the instructions contained in Regulations S-X, or the information is included elsewhere in the financial statements or notes thereto. (ii) Exhibits. Exhibit Number Description 2.1 Plan of Dissolution and Liquidation. 3.1 Certificate of Incorporation and all Amendments thereto through August 31, 1990. (Incorporated by reference--Exhibit 3(a) to the Company's Annual Report on Form 10-K for the year ended December 31, 1990.) 3.2 Bylaws amended through July 29, 1991. (Incorporated by reference--Exhibit 3(a) to the Company's Annual Report on Form 10-K for the year ended December 31, 1991.) 4.1 Specimen common stock certificate. (Incorporated by reference--Exhibit 4(a) to the Company's Annual Report on Form 10-K for the year ended December 31, 1990.) 4.2 Certificate of Incorporation and all Amendments and Amended and Restated Bylaws. (Incorporated by reference--Exhibit 3(a) to the Company's Annual Report on Form 10-K for the year ended December 31, 1990 and included as Exhibit 3(b) hereto.) 4.3 Indentures between CenCor, Inc. and Commercial National Bank of Kansas City, N.A. dated April 27, 1993 with respect to notes due 1999. (Incorporated by reference--Exhibit T3C to Company's Application on Form T-3; SEC file #22-24246.) 10.1 Restructuring, Security and Guaranty Agreement dated October 30, 1992 between Dental Assistants, Inc., United Health Careers Institute, Inc., Southern California College of Medical and Dental Assistants, Inc., Concorde Careers--Florida, Inc., Colleges of Dental and Medical Assistants, Inc. and Computer Career Institute, inc. (Incorporated by reference -- Exhibit 100) to Company's Annual Report on Form 10-K for the year ended December 31, 1992.) 10.2 First Amendment to Restructuring, Security and Guarantee Agreement between CenCor, Concorde, Minnesota Institute of Medical and Dental Assistance, Texas College of Medical and Dental Assistants, Texas College of Medical and Dental Assistants, Inc., United Health Careers Institute, Inc., Southern California College of Medical and Dental Assistants, Inc., Concorde Careers--Florida, Inc., College of Dental and Medical Assistants, Inc. and Computer Career Institute, Inc. dated December 30, 1993. (Incorporated by reference--Exhibit 10(i) to the Company's Annual Report on Form 10-K for the year ended December 31, 1993.) 10.3 Stock Appreciation Agreement with Jack Brozman dated October 4, 1994. (Incorporated by reference--Exhibit 10(j) to the Company's Annual Report on Form 10-K for the year ended December 31, 1994.) 10.4 Minutes of Compensation Committee dated February 7, 1995 relating to amendments to Stock Appreciation Agreements. (Incorporated by reference--exhibit 10(k) to the Company's Annual Report on Form 10-K for the year ended December 31, 1994. 10.5 Mutual Release between First Portland Corporation, FP Holdings, Inc. and Leonard and Sharlene Ludwig, Arthur and Phyllis Levinson, CEL-CEN Corp. and CenCor, Inc. dated February 14, 1995. (Incorporated by reference--Exhibit 10(l) to the Company's Annual Report on Form 10-K for the year ended December 31, 1994.) 10.6 Second Amendment to the Restructuring, Security and Guaranty Agreement between CenCor, Concorde, Minnesota Institute of Medical and Dental Assistance, Texas College of Medical and Dental Assistants, Texas College of Medical and Dental Assistants, Inc., United Health Careers Institute, Inc., Southern California College of Medical and Dental Assistants, Inc. and Computer Career Institute, Inc. dated November 15, 1994. (Incorporated by reference--Exhibit 10(m) to the Company's Annual Report on Form 10-K for the year ended December 31, 1994.) 10.7 Settlement Agreement dated March 27, 1995 among CenCor, Inc., Century Acceptance Corporation, Jack L. Brozman, Executor, and Jack L. Brozman, Trustee. (Incorporated by reference--Exhibit 10(o) to the Company's Annual Report on Form 10-K for the year ended December 31, 1994.) 10.8 Purchase Agreement dated May 19, 1995 by and among CenCor, Century and Fidelity Acceptance Corporation. (Incorporated by reference-- Exhibit 10.13 to the Company's Annual report on Form 10-K for the year ended December 31, 1995.) 10.9 Employment Agreement dated July 3, 1995 between CenCor and Jack Brozman. (Incorporated by reference--Exhibit 10.14 to the Company's Annual report on Form 10-K for the year ended December 31, 1995.) 10.10 Third Amendment to the Restructuring, Security and Guaranty Agreement. 10.11 Fourth Amendment to the Restructuring Security and Guaranty Agreement. 21 Subsidiaries of the Registrant. 27 Financial Data Schedule. (b) Reports on Form 8-K: No reports on Form 8-K were filed during the quarter ending December 31, 1996. SIGNATURES Pursuant to the requirements of Section 13 or 159d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CENCOR, INC. By: /s/ Jack L. Brozman Jack L. Brozman Chairman of the Board Date: March 31, 1997 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Registrant and in the capacities and on the dates indicated. By: /s/ Jack L. Brozman March 31, 1997 Jack L. Brozman (Chairman of the Board, Chief Executive Officer and Director) By: /s/ Terri L. Rinne March 31, 1997 Terri L. Rinne (Vice President and Chief Financial Officer) By: /s/ Edward G. Bauer, Jr. March 31, 1997 Edward G. Bauer, Jr. (Director) By: /s/ George L. Bernstein March 31, 1997 George L. Bernstein (Director) By: /s/ Marvin S. Riesenbach March 31, 1997 Marvin S. Riesenbach (Director) EX-2.1 2 EX-2.1 PLAN OF DISSOLUTION AND LIQUIDATION OF CENCOR, INC. This PLAN OF DISSOLUTION AND LIQUIDATION (the "Plan") is for the purpose of effecting (i) the complete voluntary dissolution of CenCor, Inc., a Delaware corporation (the "Corporation"), in accordance with the applicable provisions of the Delaware General Corporation Law, as amended (the "DGCL") and (ii) the liquidation of the Corporation's assets pursuant to Section 331 of the Internal Revenue code of 1986, as amended (the "Code"), in substantially the following manner: 1. Authorization and Approval of the Plan. This Plan shall be submitted to the stockholders (the "Stockholders") of the Corporation, in accordance with the requirements of Section 275 of the DGCL, for authorization and approval at an annual meeting (the "Annual Meeting") of the Stockholders. This Plan shall be considered authorized and approved by the Corporation and shall become effective when the holders of a majority of the outstanding shares of common stock, par value $1.00 per share (the "Common Stock"), of the Corporation authorize and approve the dissolution and liquidation of the Corporation in accordance with the Plan and the requirements of Section 275(b) of the DGCL. 2. Filings. After the Stockholders have authorized and approved this Plan, the officers and directors of the Corporation are authorized to take all steps necessary or appropriate to (i) dissolve the Corporation in accordance with the applicable provisions of the DGCL, including, but not limited to, the prompt execution and filing of a Certificate of Dissolution with the Secretary of State of the state of Delaware, (ii) wind up the Corporation's affairs and (iii) liquidate the Corporation's assets in accordance with the applicable provisions of the Code, including, but not limited to, the execution and filing of any tax returns, certificates, documents and information returns required to be filed with the Internal Revenue Service, and any other appropriate authority due to the dissolution of the Corporation and the liquidation of its assets. 3. Effective Date. The Effective Date shall be October 1, 1996. 4. Payment and Distribution to Claimants. Commencing on the Effective Date the officers and directors of the Corporation, in the discretion of the board of directors of the Corporation then in office (the "Board"), shall (i) pay or make reasonable provision to pay all claims and obligations of the Corporation as they become due, including the Corporation's notes due July 1, 1999 and all contingent, conditional, or unmatured contractual claims known to the Corporation, and (ii) make such provision as will be reasonably likely to be sufficient to provide compensation for claims that have not been made known to the Corporation, are likely to arise or to become known to the Corporation prior to the expiration of the applicable statutes of limitation. All claims of the Corporation shall be paid in full and any such provision for payment made shall be made in full if there are sufficient funds pursuant to the requirements of Section 4(i) and (ii) of this Plan. If there are insufficient funds, such claims and obligations of the Corporation shall be paid or provided for according to their priority and, among claims of equal priority, ratably to the extent of funds legally available therefor. 5. Distribution to Stockholders. Upon the satisfactory completion of the requirements of Sections 4(i) and (ii) of this Plan, the officers and directors of the Corporation shall distribute in one or a series of distributions, at any time or from time to time, and in any manner that the Board, in its discretion, may determine, all funds resulting from the Corpora- tion's liquidation of its assets on a pro rata basis in accordance with the respective interests of the Stockholders in the Corporation. The respective interests of the Stockholders shall be fixed on the basis of the ownership of their outstanding shares of Common Stock of the Corporation on a record date to be determined by the Board. 6. Cessation of Business. Promptly after the Effective Date, the Corporation shall withdraw from all jurisdictions in which the Corporation is qualified to do business and shall not engage in any business activities, other than to wind up the Corporation's business and affairs under the applicable provisions of the DGCL and in accordance with this Plan. The Board and, at the pleasure of the Board, the officers, shall continue in office for that purpose and shall receive such compensation for their services as the Board shall determine. 7. Authority of Officers and Directors. The officers and directors of the Corporation shall have the authority to carry out and implement the provisions of this Plan, including, but not limited to, the authority to: (i) sell, exchange, lease or otherwise dispose of any assets, other than cash, of the Corporation to any person or persons to the extent such transaction can be accomplished for consideration and upon terms and conditions deemed by the Board to be in the best interests of the Corporation and the Stockholders; (ii) do, on behalf of the Corporation, all acts required to be done by the Corporation under this Plan or the applicable provisions of the DGCL and the Code; (iii) provide for one or more liquidating trustees or receivers for the benefit of the Corporation's creditors and stockholders, including but not limited to trustees under a liquidating trust agreement and transferring to them (A) any assets the retention of which may be advisable to meet claims or expenses, and (B) any assets held on behalf of Stockholders who cannot be located; and (iv) adopt all resolutions, execute all documents, file all papers and take all other actions deemed necessary or appropriate to effect the dissolution of the Corporation and the complete liquidation of its business, assets and affairs; it being understood that nothing contained in this Section 7 shall be construed to permit the officers or directors of the Corporation to take any action which is inconsistent with the requirements of the DGCL or with Sections 332 or 337 of the Code. 8. Authority of the Board. Pursuant to the authority granted to the Board by Section 275(e) of the DGCL, notwith- standing the authorization or consent of the Stockholders to the Plan (or the authorization and approval of the Plan by Stockholders), the Board may abandon this Plan and the proposed dissolution of the Corporation at any time without further action by the Stockholders. 9. Completion of Dissolution and Liquidation. It is intended that the implementation of this Plan be completed within three (3) years of the Effective Date. EX-10.10 3 Ex-10.10 THIRD AMENDMENT TO THE RESTRUCTURING, SECURITY AND GUARANTY AGREEMENT THIS AGREEMENT, made and entered into as of the 30th day of July, 1996 (the "Third Amendment"), by and among CENCOR, INC., a Delaware corporation ("CenCor"); CONCORDE CAREER COLLEGES, INC., a Delaware corporation ("Concorde"); MINNESOTA INSTITUTE OF MEDICAL AND DENTAL ASSISTANTS, INC., a Minnesota corporation ("Minnesota"); TEXAS COLLEGE OF MEDICAL AND DENTAL ASSISTANTS, INC., a Texas corporation ("Texas"); UNITED HEALTH CAREERS INSTITUTE, INC., a California corporation ("United"); SOUTHERN CALIFORNIA COLLEGE OF MEDICAL AND DENTAL ASSOCIATES, INC., a California corporation ("Southern California"); CONCORDE CAREERS - FLORIDA, INC., a Florida corporation ("Florida"); COLLEGES OF DENTAL AND MEDICAL ASSISTANTS, INC., an Oregon corporation ("Dental"); and COMPUTER CAREER INSTITUTE, INC., an Oregon corporation ("Computer") (Minnesota, Texas, United, Southern California, Florida, Dental, and Computer being hereinafter referred to collectively as "Guarantors" and each individually as a "Guarantor") amends that certain Restructuring, Security and Guaranty Agreement between the parties dated as of October 30, 1992, as previously amended by written agreements dated as of December 30, 1993 and November 15, 1994 (collectively, the "Agreement"). RECITALS (i) Pursuant to the Agreement entered into by CenCor, Concorde and the Guarantors, Concorde issued a debenture to CenCor in the principal amount of $5,422,307, dated October 30, 1992 (the "Debenture"). (ii) Pursuant to the terms of the November 15, 1994, amendment (the "Second Amendment"), Concorde exchanged 300,000 shares of its Class A Redeemable Preferred Stock, $.10 par value (the "Preferred Stock") for $3,000,000 of the principal amount of the Debenture; reduced the outstanding principal amount of the Debenture to $2,442,307, and amended the Debenture to reflect such. (iii) The Mark Twain liabilities have been paid in full by Concorde and are no longer outstanding. (iv) Concorde desires to sell substantially all of the assets (the "San Jose Assets") of the career college it operates at 1290 N. 1st Street, San Jose, California, known as Concorde Career Institute (the "San Jose Institute") pursuant to a certain Asset Purchase Agreement, dated July 11, 1996, between Concorde and Corinthian Schools, Inc. (the "San Jose Agreement"), a true and correct copy of which has been delivered to CenCor by Concorde. (v) Concorde desires to cause its wholly-owned subsidiary, Person/Wolinsky Associates, Inc., a New York corporation ("P/W"), to sell substantially all of its assets (the "P/W Assets") pursuant to a certain Asset Purchase Agreement, dated July 10, 1996, among P/W, Concorde and DGZ Associates, Inc. (the "P/W Agreement"), a true and correct copy of which has been delivered to CenCor by Concorde. (vi) CenCor holds a security interest in substantially all of the assets of Concorde and the Guarantors, securing the payment of the principal amount of the Debenture and the Agreement prohibits the sale of assets by Concorde, including the San Jose Assets or P/W, including the P/W Assets, without the consent of CenCor. (vii) CenCor has agreed to the sale of the San Jose Assets pursuant to the terms of the San Jose Agreement (the "San Jose Sale") and the sale of the P/W Assets pursuant to the terms of the P/W Agreement (the "P/W Sale") and to the release of its security interest in such assets, subject to Concorde's agreement to use a certain portion of the proceeds received by it and/or P/W pursuant to the San Jose Sale and the P/W Sale to redeem outstanding shares of Preferred Stock held by CenCor, and thereafter to retire the Debenture, all as set forth herein. (viii) Concorde and CenCor wish to amend the Agreement to provide for such sale of assets and such redemption and retirement. (ix) The Guarantors, each a wholly-owned subsidiary of Concorde, wish to reduce the amount of their guaranteed obligations through such retirement and thus consent to the amendment of the Agreement to provide for such. AGREEMENT In consideration of the premises and the mutual covenants and agreements herein contained, CenCor, Concorde and Guarantors agree as follows: ARTICLE I Definitions 1.1 Certain Defined Terms. The following terms used herein shall have the meanings set forth in this Article and in the other parts of this Agreement referred to in this Article, and such meanings shall apply to both the singular and plural forms of such terms. (a) "Allocated Proceeds" means that portion of proceeds from the San Jose Sale or the P/W Sale identified on Exhibit A, attached hereto and incorporated herein, actually received by Concorde and/or P/W. (b) "Preferred Stock" means the Class A Redeemable Preferred Stock, $.10 par value, of Concorde. (c) "Redemption Price" means the redemption of shares of Preferred Stock by Concorde pursuant to the provisions of Section 2.2, herein. (d) "Redemption Price" means the per share redemption price set forth in the Certificate of Designations filed with the Secretary of State of Delaware with respect to the Preferred Stock, of $10.00 per share, plus all accrued but unpaid dividends thereon, calculated on the basis set forth in Section (1)(iii) of such Certificate of Designations. (e) "Retirement" means the full or partial retirement of the Debenture by Concorde pursuant to the provisions of Section 2.3 herein. (f) "Third Amendment" means this Third Amendment to the Restructuring, Security and Guaranty Agreement, dated October 30, 1992, as previously amended by written agreements dated as of December 30, 1993 and November 15, 1994. 1.2 Other Terms. All capitalized terms used herein, not defined in Section 1. 1 or elsewhere in this Third Amendment, shall have the meanings and be as defined in the Second Amendment, and if not therein defined, as defined in the First Amendment, and if not therein defined, as defined in the original provisions of the Agreement. ARTICLE II The Exchange 2.1 Application of Proceeds. Concorde hereby agrees that, upon the closing of the San Jose Sale and/or the P/W Sale and the receipt by Concorde or P/W of proceeds therefrom, it shall apply, or cause to be applied, the Allocated Proceeds, as follows: (a) first, to the redemption of shares of Preferred Stock (the "Redemption"), and, upon the Redemption of all of the Preferred Stock, (b) second, to the retirement of the Debenture (the "Retirement"). 2.2 Redemption of the Preferred Stock. Promptly upon the receipt of Allocated Proceeds, Concorde shall redeem that number of whole shares of Preferred Stock held by CenCor (or its assigns) equal to the amount of such Allocated Proceeds divided by the Redemption Price. Any Allocated Proceeds remaining that would have been applied but for the requirement that only whole shares be redeemed, shall be retained by Concorde and aggregated with subsequently received Allocated Proceeds for future Redemptions/Retirements. 2.3 Retirement of Debenture. Following the Redemption of all outstanding shares of Preferred Stock, promptly upon receipt of Allocated Proceeds, Concorde shall pay such Allocated Proceeds to CenCor with respect to the Debenture, pursuant to the terms of the Agreement, first to be applied to the payment of any then accrued but unpaid interest on the Debenture and next to the principal amount of the Debenture. 2.4 Date of Redemption/Retirement. Except as otherwise provided for in Section 2.2, above, the date of Redemption or Retirement with respect to any Allocated Proceeds shall be: (a) the closing date of the respective asset sales, with respect to Allocated Proceeds received by Concorde and/or P/W on such closing dates, and (b) on or before three (3) business days from the date of the receipt of good funds with respect to Allocated Proceeds received by Concorde and/or P/W after such closing dates. It is agreed that if Allocated Proceeds are not received by the Scheduled Date designated on Exhibit A, Concorde and P/W shall promptly notify CenCor and take all reasonably prudent steps necessary to collect such funds. Notwithstanding anything herein to the contrary, Concorde shall have no obligation to effect a Redemption or Retirement unless and until its receipt of Allocated Proceeds. 2.5 Procedures. In connection with: (a) any Redemption or Retirement, Concorde shall provide CenCor with an accounting of the calculation of the then current Redemption Price; and (b) a Redemption, (i) Concorde shall provide CenCor with a calculation of the application the of Allocated Proceeds and any carryover thereof; (ii) CenCor shall submit its stock certificate representing the Preferred Stock, fully endorsed for transfer, and (iii) Concorde shall reissue a new stock certificate to CenCor representing the remaining shares of Preferred Stock not being so redeemed, if any. 2.6 Payment in Full. Upon the Redemption of all outstanding shares of Preferred Stock owned by CenCor (or its assigns) and the Retirement of the entire Debenture (including accrued interest thereon), Concorde shall be entitled to retain any remaining Allocated, Proceeds and CenCor has had no further rights or interest in such Allocated Proceeds. ARTICLE III Consent and Release of Collateral 3.1 Consent to Sale. CenCor hereby consents to the San Jose Sale pursuant to the San Jose Agreement and to the P/W Sale pursuant to the terms of the P/W Agreement, and waives any restrictions set forth in Section 7.1 or elsewhere in the Agreement with respect thereto. 3.2 Release of Collateral. CenCor hereby agrees: (a) to release its security interest in the San Jose Assets, effective upon the closing of the San Jose Sale, and agrees to promptly execute, obtain and furnish to Concorde any and all termination statements, releases or other UCC documentation or other documents or materials as Concorde may reasonably request in order to so release such Collateral; (b) that upon such releases, the San Jose Assets shall no longer constitute Collateral pursuant to Article IV of the Agreement; and (c) that in the event Concorde determines to dissolve and liquidate P/W after the closing of the P/W Sale, CenCor shall (i) release its security interest in the stock of P/W owned by Concorde, (ii) return the Pledged Stock of P/W which CenCor holds pursuant to Section 4.7 of the Agreement with respect thereto; and (iii) consent to such dissolution and liquidation. 3.3 Undertaking. Concorde agrees to execute any security agreements, UCC-1 financing--statements and other documents reasonably requested by CenCor to grant a security interest in all of the assets of Concorde and the Guarantors which are not being sold pursuant to the San Jose Agreement or the P/W Agreement. Concorde will not agree to any amendment, delay or waiver of its rights or P/W's right to receive any of the Allocated Proceeds on the dates set forth on Exhibit A without CenCor's written consent. ARTICLE IV Miscellaneous 4.1 Obligations of P/W. In consideration of CenCor's agreement to the terms of this Third Amendment and its consent to the P/W Sale, P/W has agreed to guarantee the obligation of Concorde to apply the Allocated Proceeds from the P/W Sale to the Redemption arid/or Retirement as provided for herein and has executed Exhibit 4.1 hereto in evidence of such guarantee. 4.2 Mark Twain Liabilities. Mark Twain has executed the confirmation, attached hereto as Exhibit 4.2, acknowledging the payment in full of the Mark Twain Liabilities. 4.3 Attorneys' Fees. Notwithstanding anything in the Agreement or herein to the contrary, Concorde shall pay to CenCor in cash one-half of CenCor's attorneys' fees and expenses incurred in connection with the negotiation of this Third Amendment and the consummation of the transactions contemplated thereby, within ten (10) business days after receiving an invoice from CenCor with supporting documentation, which the parties agree shall not exceed $5,000.00 in the aggregate. 4.4 Ratification. All provisions of the Agreement not specifically amended in this Third Amendment are hereby ratified and reaffirmed. 4.5 Governing Law. Except as otherwise provided by express reference to the Uniform Commercial Code, this Third Amendment shall be construed in accordance with and governed by the laws, statutes and decisions of the State of Missouri, to the non- exclusive jurisdiction of whose courts, state and federal, Concorde and Guarantors irrevocably agree to submit. 4.6 Incorporation. The recitals and exhibits hereto are hereby incorporated herein by reference. 4.7 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. 4.8 Further Assurances. The parties hereto agree to execute all additional documents reasonably necessary to effectuate the transactions contemplated herein, including without limitation those documents necessary to release the Liens with respect to the San Jose Assets and the P/W Assets on a timely basis. 4.9 Benefit and Burden. This Agreement shall be binding upon and inure to the benefit of the successors of CenCor, Concorde and P/W. CenCor may assign its rights hereunder, including without limitation to a liquidating trust. IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to the Agreement to be executed by their respective duly authorized officers as of the day and year first above written. Oral agreements or commitments to loan money, extend credit or to forbear from enforcing repayment of a debt including promises to extend or renew such debt are not enforceable. To protect the debtor and creditor from misunderstanding or disappointment, any agreements we reach covering such matters are contained in this writing, which is the complete and exclusive statement of the agreement between us, except as we may later agree in writing to modify it. CENCOR, INC. ATTEST: By: Terri Rinne Terri Rinne Lisa M. Henak Vice President Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came Terri Rine, Vice President of CenCor, Inc., a Delaware corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996 CONCORDE CAREER COLLEGES, INC. ATTEST: By: M. Gregg Gimlin M. Gregg Gimlin Lisa M. Henak Vice President Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came M. Gregg Gimlin, Vice President of Concorde Career Colleges, Inc., a Delaware corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996 MINNESOTA INSTITUTE OF MEDICAL AND DENTAL ASSISTANTS, INC. ATTEST: By: A. Eugene Johnson A. Eugene Johnson Lisa M. Henak President Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Minnesota Institute of Medical and Dental Assistants, Inc., a Minnesota corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996 TEXAS COLLEGE OF MEDICAL AND AND DENTAL ASSISTANTS, INC. ATTEST: By: A. Eugene Johnson A. Eugene Johnson Lisa M. Henak President Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Texas College of Medical and Dental Assistants, Inc., a Texas corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996 UNITED HEALTH CAREERS INSTITUTE, INC. ATTEST: By: A. Eugene Johnson A. Eugene Johnson Lisa M. Henak President Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of United Health Careers Institute, Inc., a California corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996 SOUTHERN CALIFORNIA COLLEGE OF MEDICAL AND DENTAL ASSISTANTS, INC. ATTEST: By: A. Eugene Johnson A. Eugene Johnson Lisa M. Henak President Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Southern California College of Medical and Dental Assistants, Inc., a California corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996 COLLEGES OF DENTAL AND MEDICAL ASSISTANTS, INC. ATTEST: By: A. Eugene Johnson A. Eugene Johnson Lisa M. Henak President Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Colleges of Dental and Medical Assistants, Inc., a California corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996 COMPUTER CAREER INSTITUTE, INC. ATTEST: By: A. Eugene Johnson A. Eugene Johnson Lisa M. Henak President Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Computer Career Institute, Inc., an Oregon corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996 CONCORDE CAREERS - FLORIDA, INC. ATTEST: By: A. Eugene Johnson A. Eugene Johnson Lisa M. Henak President Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Concorde Careers- Florida, Inc., a Florida corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996
EXHIBIT A Funds to be Applied to Retirement of Preferred Stock and Redemption of Debenture Allocated Scheduled Aggregate Proceeds/ Source Date of Receipt Amount Percentage (C> San Jose Sale SJ Closing Date $150,000 $ 75,000/50% - -Purchase Price P/W Sale P/W Closing Date $705,000 $352,500/50% - -Purchase Price P/W Sale 12/15/96 $ 75,000 $ 75,000/100% - -Noncompete San Jose Sale 12/31/96 $200,000 $100,000/50% - -Purchase Price P/W Sale 12/15/97 $ 75,000 $ 75,000/100% - -Noncompete P/W Sale 3/1/98-07 /50% - -Profit Participation ______________________________ Subject to the actual closing of the respective sales of assets. The San Jose Sale is currently scheduled to close on July 31, 1996. The P/W Sale is currently scheduled to close on August 2, 1996. Fee of 6% has been deducted from closing proceeds of the P/W Sale. It is agreed that in the event such proceeds are not paid pursuant to the Noncompetition Agreement under the P/W Agreement, Concord and/or P/W shall apply the next funds received by either of them under the P/W Agreement for the Redemption/Retirement, up to the amount of such failed payment. "Profit Participation", up to a cumulative maximum amount of $1,500,000, is due annually based upon the actual "Net Profit", as defined in Exhibit 2.3 of the P/W Agreement, of the purchaser of the P/W Assets for the fiscal years ended December 31, 1997 through December 31, 2006 and is payable on or before March 1 of each of the following years (1998-2007). The amount to be paid in any given year, is any, is not currently ascertainable. One half of the monies so received, if any, shall be allocated Proceeds.
EXHIBIT 4.1 IN CONFIRMATION OF THE OBLIGATIONS SET FORTH IN SECTIONS 2.4 and 4.1, above: PERSON/WOLINSKY ASSOCIATES, INC. ATTEST: By: Jack L. Brozman Jack L. Brozman Lisa M. Henak Chairman of the Board Secretary ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of July, 1996, before me, the undersigned, a notary public in and for said state, came Jack L. Brozman, Chairman of the Board of Person/Wolinsky Associates, Inc., a New York corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. Lisa M. Henak Notary Public in and for said County and State My commission expires: September 7, 1996 EXHIBIT B CONFIRMATION The undersigned, Mark Twain Kansas City Bank, a Missouri banking corporation, hereby confirms that it has been paid in full with respect to all obligations owed to it under the Mark Twain Agreement and that any conditions in the Agreement requiring the subordination to, the consent of, or notice to Mark Twain Kansas City Bank are null and void. Dated: July 30, 1996 MARK TWAIN KANSAS CITY BANK By: Mark Degner Mark Degner, its Senior Vice President EX-10.11 4 EX-10.11 FOURTH AMENDMENT TO THE RESTRUCTURING, SECURITY AND GUARANTY AGREEMENT THIS AGREEMENT, made and entered into as of the 30th day of December, 1996, (the "Fourth Amendment") by and among CENCOR, INC., a Delaware corporation ("CenCor"); CONCORDE CAREER COLLEGES, INC., a Delaware corporation ("Concorde"); UNITED HEALTH CAREERS INSTITUTE, INC., a California corporation ("United"); SOUTHERN CALIFORNIA COLLEGE OF MEDICAL AND DENTAL ASSISTANTS, INC., a California corporation ("Southern California"); CONCORDE CAREERS - FLORIDA, INC., a Florida corporation ("Florida"); COLLEGES OF DENTAL AND MEDICAL ASSISTANTS, INC., a California corporation ("Dental"); COMPUTER CAREER INSTITUTE, INC., an Oregon corporation ("Computer"); and CAREER ASSISTANCE, INC., a Delaware corporation ("Career") (United, Southern California, Florida, Dental, Computer, Career, Minnesota Institute of Medical and Dental Assistants, Inc., a Minnesota corporation ("Minnesota"), and Texas College of Medical and Dental Assistants, Inc., a Texas corporation ("Texas"), being hereinafter referred to collectively as "Guarantors" and each individually as a "Guarantor") amends that certain Restructuring, Security and Guaranty Agreement between the parties dated as of October 30, 1992, as previously amended by written agreements dated as of December 30, 1993, November 15, 1994 and July 30, 1996 (collectively, the "Agreement"). RECITALS (i) Pursuant to the Agreement entered into by CenCor, Concorde and the Guarantors, Concorde issued a debenture to CenCor in the principal amount of $5,422,307, dated October 30, 1992 (the "Debenture"). (ii) Pursuant to the terms of the November 15, 1994 amendment (the "Second Amendment"), Concorde exchanged 300,000 shares of its Class A Redeemable Preferred Stock, $.10 par value (the "Class A Preferred Stock") for $3,000,000 of the principal amount of the Debenture; reduced the outstanding principal amount of the Debenture to $2,442,307, and amended the Debenture to reflect such. (iii) The Mark Twain liabilities have been paid in full by Concorde and are no longer outstanding. (iv) Concorde is the successor-in-interest by merger of two of the Guarantors, Minnesota and Texas. (v) Pursuant to the terms of the Agreement, Concorde has made quarterly payments of principal and accrued interest on the Debenture on June 30, 1996, of $69,554.05 and $72,683.95, respectively, and on September 30, 1996, of $69,554.01 and $66,119.79, respectively, thereby reducing the current outstanding principal amount of the Debenture to $2,643,052.56, and is scheduled to make a quarterly payment of principal and accrued interest ($69,554.01 and $64,424.40, respectively) on the Debenture on December 31, 1996 (the "12/96 Debenture Payment"). (vi) Pursuant to the terms of the Agreement, Concorde has redeemed a total of 39,615 shares of Class A Preferred Stock, and the accrued dividends thereon, thereby reducing the number of shares of Class A Preferred Stock currently outstanding to 260,385 shares. (vii) Due to modifications of the terms of the San Jose sale made prior to its closing on August 31, 1996, the amount and payment date of the second installment of the San Jose Sale purchase price was modified to be $300,000 on February 28, 1997, of which 50% is scheduled to be paid by Concorde to CenCor. (viii) Career is a newly formed subsidiary of Concorde and, pursuant to the provisions of Section 7.4 of the Agreement, (A) Concorde has pledged its shares of stock of Career to CenCor and (B) by execution of this Fourth Amendment, Career hereby agrees to become a Guarantor subject to all the provisions of the Agreement applicable to Guarantors and to pledge its assets as security to CenCor. (ix) Concorde is currently seeking to raise additional capital and to obtain a new bank credit facility (collectively, the "Refinancing") which will enable it to (a) redeem all outstanding shares of Class A Preferred Stock and pay all accrued but unpaid dividends thereon; (b) retire the Debenture by the repayment in full of the outstanding principal thereof and all accrued but unpaid interest thereon and the Additional Payment; and (c) repay in full the Unsecured Debt, with all accrued but unpaid interest thereon (collectively, the "Repayment"). (x) In order to facilitate the Refinancing and in consideration of Concorde's agreement that it will use the proceeds from the Refinancing to make the Repayment, the parties hereto have agreed to the terms of the Repayment and related matters, all as set forth herein. (xi) Concorde and CenCor wish to amend the Agreement to provide for the Repayment. (xii) The Guarantors wish to eliminate their guaranteed obligations through the Repayment and thus consent to the amendment of the Agreement to provide for such. AGREEMENT In consideration of the premises and the mutual covenants and agreements herein contained, CenCor, Concorde and Guarantors agree as follows: Definitions 1.1 Certain Defined Terms. The following terms used herein shall have the meanings set forth in this Article and in the other parts of this Agreement referred to in this Article, and such meanings shall apply to both the singular and plural forms of such terms. (a) "Class A Preferred Stock" means the Class A Redeemable Preferred Stock, $.10 par value, of Concorde, as currently existing pursuant to the Certificate of Designations filed with the Secretary of State of Delaware on November 16, 1994. (b) "Class B Preferred Stock" means the Class B Preferred Stock, that may be authorized by Concorde's Board of Directors pursuant to a Certificate of Designations to be filed with the Secretary of State of Delaware and issued solely pursuant to the Refinancing in connection with a new equity investment in Concorde. (c) "Class A-1 Preferred Stock" means the Class A-1 Preferred Stock, that shall be authorized by Concorde's Board of Directors pursuant to a Certificate of Designations, substantially in the form of Exhibit A hereto (the "Class A-1 Certificate of Designation"), to be filed with the Secretary of State of Delaware and issued to CenCor in exchange for the outstanding Class A Preferred Stock pursuant to Section 5.3, hereof in the event the Repayment does not occur by February 28, 1997. (d) "Closing" means the closing of the Repayment, as set forth in Section 2.2 and as scheduled in Section 2.3, herein. (e) "Fourth Amendment" means this Fourth Amendment, dated December 30, 1996, to the Restructuring, Security and Guaranty Agreement, dated October 30, 1992, as previously amended by written agreements dated as of December 30, 1993, November 15, 1994, and July 30, 1996. (f) "Michigan Allocated Proceeds" means that portion of proceeds from the sale of Concorde's Michigan real property identified in Section 3.5 hereof, actually received by Concorde that shall be applied to the redemption of outstanding Class A Preferred Stock. (g) "Obligations" means the aggregate of (i) the Redemption Price of the Class A Preferred Stock (including accrued dividends) outstanding on the Closing Date, and (ii) the principal and accrued interest on the Debenture and the Unsecured Debt outstanding on the Closing Date and all amounts owing with respect to the Additional Payment pursuant to the Agreement, all of which shall be paid in fall at Closing. (h) "Post 9/30/96 Payments" means the cumulative amount of any (i) Redemption Price paid by Concorde with respect to the retirement of Class A Preferred Stock; (ii) payment of principal on the Debenture made by Concorde and (iii) repayments of principal on the Unsecured Debt made by Concorde, that were paid on or after September 30, 1996 but prior to the Closing Date. (i) "Refinancing" means the infusion by investors of a minimum of $5,000,000 in capital into Concorde and Concorde's securing of new bank credit facilities in the minimum amount of $3,000,000. (j) "Repayment" means Concorde's repayment of all its then existing financial obligations owed to CenCor, including (i) the redemption of all its outstanding shares of Class A Preferred Stock and the payment of all accrued but unpaid dividends thereon; (ii) the retirement of the Debenture, with the repayment in full of the outstanding principal thereof and all accrued but unpaid interest thereon; (iii) the retirement of the Unsecured Debt, with the repayment in full of the outstanding principal thereof and all accrued but unpaid interest thereon; and (iv) the payment of the Additional Payment. (k) "Repayment Price" means the total amount of consideration, as adjusted, to be paid by Concorde to CenCor in connection with the Repayment, as set forth in Section 2.4 herein. (l) "Unsecured Debt" means the unsecured debt of Concorde owed to CenCor represented by Concorde's promissory note dated February 26, 1993, which as of December 16, 1996 totals $189,285.24 in principal, and $55,499.45 in accrued - but unpaid interest. 1.2 Other Terms. All capitalized terms used herein, not defined in Section 1.1 or elsewhere in this Fourth Amendment, shall have the meanings and be as defined in the Third Amendment, and if not therein defined, as defined in the Second Amendment, and if not therein defined, as defined in the First Amendment, and if not therein defined, as defined in the original provisions of the Agreement. The Repayment 2.1 Agreement to Repay. Subject to the terms and conditions herein, Concorde hereby agrees that, contingent upon it obtaining the Refinancing, it will pay the Repayment Price to CenCor in repayment in full of the Obligations. Subject to the terms and conditions herein, CenCor hereby agrees to accept the Repayment Price from Concorde as redemption, in full, of its Class A Preferred Stock and as payment in full of all of Concorde's debt obligations owed to CenCor pursuant to the Debenture and the Unsecured Debt. The parties hereto agree that the closing of the Refinancing and Concorde's receipt of the proceeds thereof is a condition precedent to the Repayment. Concorde undertakes that it will use the proceeds of the Refinancing for the Repayment. 2.2 Closing of the Repayment. At the Closing of the Repayment (the "Closing"), Concorde shall deliver to CenCor, by wire transfer pursuant to CenCor's instructions, cash in an amount equal to the Repayment Price in exchange for CenCor's delivery to Concorde of: (a) certificates representing all of the then outstanding shares of Class A Preferred Stock, duly endorsed for transfer to Concorde and cancellation; (b) the Debenture, marked "paid in full"; (c) the promissory note, representing the Unsecured Debt, marked "paid in full"; (d) properly executed releases and/or cancellations of all mortgages, and other Liens, including releases of all UCC filings, held by CenCor with respect to the assets of Concorde or any of the Restricted Subsidiaries, all in such form as may be required for filing and recordation with the appropriate governmental agencies or offices; (e) fully executed cancellations of the guaranties issued by the Guarantors pursuant to original terms of the Agreement; and (f) such other documents and/or certificates deemed necessary or advisable by Concorde's counsel in order to effectuate the full release of Concorde, the Restricted Subsidiaries and the Guarantors from all liabilities or other obligations owed to CenCor, other than those regarding substitution of receivables specifically set forth in Section 4.1, herein. 2.3 Closing Date. The Closing shall occur at 10:00 a.m., on December 31, 1996, at the office of Bryan Cave LLP, 3500 One Kansas City Place, 1200 Main Street, Kansas City, Missouri 64105, unless extended at Concorde's option to such later date as may be required to completed the Refinancing (as may be so extended, the "Closing Date"), provided however, the date of Closing may not be extended beyond February 28, 1997, without the written consent of CenCor. In any event, the Closing Date shall not be extended to a date beyond the closing date of the Refinancing. 2.4 Repayment Price. Subject to adjustment as set forth herein, the Repayment Price to be paid by Concorde to CenCor at Closing shall be an amount equal to $4,868,006, minus the cumulative amount of any Post 9/30/96 Payments. Notwithstanding the foregoing, the amount of the Repayment Price shall be increased by an amount equal to the product of (a) the number of days the actual Closing Date extends beyond December 20, 1996 multiplied by (b) a per them adjustment of $1,333. 2.5 Allocation of Repayment Price. The Repayment Price shall be allocated among the Obligations as follows: (a) first, to the principal of the Debenture; (b) second, to the accrued interest on the Debenture; (c) third, to the principal of the Unsecured Debt; (d) fourth, to the accrued interest on the Unsecured Debt; (e) fifth, to the Additional Payment; and (f) sixth, to the Redemption Price. 2.6 Waiver of Breaches Resulting from Refinancing. In addition to any waivers heretofore granted by CenCor to Concorde in writing, CenCor hereby waives any and all breaches of the Agreement that have occurred or may occur as a result of the implementation of the Refinancing, including the issuance of Class B Preferred Stock and/or the grant of security interests in the assets of Concorde and/or the Restricted Subsidiaries (which, prior to Closing, shall continue to be subordinate to the security interest of CenCor). Obligations Pending Closing 3.1 Continuing Duties of Payment. Concorde shall continue to be obligated to make quarterly payments of principal and interest pursuant to Section 2.3(a) of the Agreement and Section 2.3(a) of the Agreement shall be amended to provide that the obligation to make such quarterly payments shall continue through maturity of the Debenture on January 1, 1998. Additionally, Concorde shall continue to be obligated to make scheduled redemptions of the Class A Preferred Stock, pursuant to the provisions of the Third Amendment to the Agreement. 3.2 Extension of Maturity Dates. (a) Sections 2.3(a) and 2.3(c) of the Agreement shall be amended to provide that the Debenture shall bear a maturity date of January 1, 1998. (b) Section 2.3(b) of the Agreement shall be amended to provide that required annual prepayments made with respect to Excess Cash Flow shall continence on March 30, 1998, with respect to Concorde's fiscal year ending December 31, 1997. (c) The promissory note representing the Unsecured Debt shall be amended to provide that the principal and interest thereon shall not become due and payable until January 1, 1998. 3.3 Additional Payment. Section 2.5 of the Agreement shall be amended to provide that the Additional Payment due at Closing shall be $10.00, however if Closing does not occur as scheduled, the Additional Payment shall be calculated as currently provided. 3.4 Waiver of Breaches. In addition to any waivers heretofore granted by CenCor to Concorde in writing, CenCor hereby waives any and all breaches of the Agreement that have occurred or may occur as a result of the execution of that certain lease dated July 31, 1996, with respect to Concorde's North Hollywood, California School and the implementation of the leasehold improvements of $900,000 related thereto. 3.5 Consent to Sale. Subject to the terms and conditions herein, CenCor hereby (a) consents to the sale (the "Michigan Sale") of the real property located in Warren, Michigan (the "Michigan Property"), owned by Concorde Career Colleges, Inc.; (b) waives any restrictions set forth in Section 7.1 or elsewhere in the Agreement with respect thereto; and (c) agrees to release its mortgage with respect to the Michigan Property and any other Liens it has related thereto in connection with the closing of the Michigan Sale. In the event the Michigan Property is sold prior to Closing, fifty percent (50%) of the proceeds, net of brokerage commissions, costs of sale, and taxes (the "Michigan Allocated Proceeds"), shall be applied to the retirement of Class A Preferred Stock or the Class A-1 Preferred Stock, whichever is then outstanding. Promptly upon the receipt of the Michigan Allocated Proceeds, Concorde shall redeem that number of whole shares of Class A Preferred Stock, or Class A-1 Preferred Stock, held by CenCor (or its assigns) equal to the amount of such Michigan Allocated Proceeds divided by the Redemption Price. Any Allocated Proceeds remaining that would have been applied but for the requirement that only whole shares be redeemed, shall be retained by Concorde and aggregated with subsequently received Allocated Proceeds for future Redemptions/Retirements. (a) Following the Redemption of all outstanding shares of Class A Preferred Stock or Class A-1 Preferred Stock, Concorde shall pay any remaining Michigan Allocated Proceeds to CenCor with respect to the Debenture, pursuant to the terms of the Agreement, first to be applied to the payment of any then accrued but unpaid interest on the Debenture and next to the principal amount of the Debenture. (b) Except as otherwise provided for in this Section 3.5, the date of Redemption or Retirement with respect to any Michigan Allocated Proceeds shall not occur prior to three (3) business days from the date of the receipt of good funds with respect to the Michigan Allocated Proceeds received by Concorde. Notwithstanding anything herein to the contrary, Concorde shall have no obligation to effect a Redemption or Retirement unless and until its receipt of Michigan Allocated Proceeds (c) The procedures for Redemption or Retirement under this Section 3.5 shall be in accordance with Section 2.5 of the Third Amendment. Upon the Redemption of all outstanding shares of Class A Preferred Stock owned by CenCor (or its assigns) and the Retirement of the entire Debenture (including accrued interest thereon), Concorde shall be entitled to retain any remaining Michigan Allocated Proceeds and CenCor has no further rights or interest in such Michigan Allocated Proceeds. Post-Closing Obligations 4.1 Continuation of Right of Substitution. Following the Closing, and not withstanding the cancellation of all of the Obligations upon receipt of the Repayment Price, CenCor's Right of Substitution, set forth in Article V of The Second Amendment to the Agreement, shall continue in full force and effect with respect to the 1994 Receivables. All uncollected 1994 Receivables will be reassigned to Concorde at such time as the amount of the interest payments, for which the 1994 Receivables were assigned to CenCor, has been fully funded. 4.2 Indemnification with Respect to Assumed Subordinated Indebtedness. In lieu of the protections previously provided Concorde by Section 2.6 of the Agreement, in the event Concorde, as a result of an action before a court of competent jurisdiction, to which Concorde has presented a reasonable defense, makes any future payments, to CenCor or any other Person, on account of the Assumed Subordinated Indebtedness, from which it has been released pursuant to the terms of the Agreement, Concorde shall be entitled to indemnification from CenCor in the amount of such payments. 4.3 Further Assurances. The parties hereto agree to undertake such further actions and execute such further documents as necessary, pre-Closing or post-Closing, to effectuate the- purposes of this Fourth Amendment, including but not limited to the Repayment and the cancellation of the Obligations. 4.4 Termination. Following the Closing, all other provisions of the Agreement, other than as set forth in this Article IV or as necessary to effectuate the intent and provisions hereof, shall be terminated and of no further force and effect. Obligations in the Event Closing Fails to Occur 5.1 Failure to Close. In the event Concorde fails to timely obtain the Refinancing and therefore the Closing does not occur by February 28, 1997, or by such later date as mutually agreed to in writing by CenCor and Concorde, the provisions of the Agreement, as amended by this Fourth Amendment, shall continue in full force and effect, except that the terms and provisions of Article II, above, shall be and become null and void. In addition to the provisions set forth above, in the event Closing fails to occur, the Agreement shall be further amended to provide as set forth in this Article V. The provisions of this Article V shall be of no force and effect unless and until the Closing fails to occur by February 28, 1997, or by such later date as mutually agreed to in writing by CenCor and Concorde. 5.2 Increase in Quarterly Payments of Principal. Section 2.3(a) of the Agreement shall be amended to provide that the scheduled quarterly payments of principal on -the Debenture shall be increased from $69,554 to $100,000, commencing with the payment due March 31, 1997. Quarterly payments of accrued interest shall continue to be payable as currently provided. 5.3 Exchange of Class A Preferred Stock. In the event the Closing has not occurred, promptly after February 28, 1997, or such later Closing Date subsequently agreed to by CenCor and Concorde, the Board of Directors shall adopt the Class A-1 Certificate of Designation, substantially in the form of Exhibit A attached hereto, and shall file such Class A-1 Certificate of Designation with the Secretary of State of Delaware to authorize the Class A-1 Preferred Stock. Thereafter, upon the written request of CenCor, Concorde and CenCor shall promptly effect a one-for-one exchange of all outstanding shares of Class A Preferred Stock for a like number of shares of Class A-1 Preferred Stock, as a result of which CenCor shall become the holder of all of the issued and outstanding shares of Class A-1 Preferred Stock, and all of the previously outstanding shares of Class A Preferred Stock shall be redeemed by Concorde and no longer be outstanding. (a) As set forth in the Class A-1 Certificate of Designation, the Class A-1 Preferred Stock shall have all of the rights and preferences of the Class A Preferred Stock, and additionally, the Class A-1 Preferred Stock (i) shall have all the contractual rights afforded to Class A Preferred Stock under the Agreement; (ii) shall have voting rights on all matters submitted to a vote of the holders of Concorde's common stock, with each share of Class A-1 Preferred Stock having eight (8) votes for each vote accorded to a share of Concorde's common stock, and (iii) shall be convertible, at the holder's option, into Concorde common stock, on a one-for-eight basis. (b) Additionally, Concorde hereby agrees that CenCor, or its assigns, shall have piggyback registration rights with respect to any shares of Concorde common stock issued or issuable as a result of the exercise of the conversion right associated with the Class A-1 Preferred Stock (the "Registerable Shares"), provided such Registerable Shares of Concorde common stock are not then immediately saleable pursuant to Rule 144 (or other successor exemption from the registration requirements) under the Securities Act of 1933, as amended (the "Securities Act"). Such piggyback rights: (i) shall attach to any registration of equity securities under the Securities Act made by Concorde on Forms S-1, S-2, S-3, or similar registration form (but shall not attach to registrations on Forms S-4, S-8, or similar purpose registrations forms); (ii) may be exercised by CenCor, or its assigns, with respect to some or all of the Registerable Shares; (iii) shall be subject to the holder of such Registerable Shares agreeing: to be bound by the terms of the underwriting agreement entered into in connection with the registration, including any indemnification, standstill or lock-up provisions required of Concorde or other selling stockholders; to accept the pricing of the offering as agreed to by Concorde with respect to the shares of common stock being sold by Concorde pursuant to the registration; and to pay its pro rata share of registration fees and underwriting commissions and discounts; (iv) shall be subject to standard discretionary curtailment, pro rata amongst all selling stockholders, by the underwriter, if in its opinion the market cannot support the total number of shares requested to be registered so that inclusion of all such shares would be detrimental to the offering taken as a whole, and (v) may be waived by CenCor as to any underwriting if CenCor does not agree with the terms of such underwriting, without forfeiture of piggyback rights as to any subsequent underwritings by Concorde. (c) Concorde hereby agrees that CenCor, or its assigns, shall have one cumulative demand registration right with respect to all Registerable Shares collectively held by CenCor and its assigns. Upon receipt of a written request for such registration (of all or part of such Registerable Shares), Concorde will: as soon as practicable, use its diligent best efforts to effect all such registrations, qualifications and compliances (including, without limitation, the execution of an undertaking to file post-effective amendments, appropriate qualifications under the applicable blue sky or other state securities laws and appropriate compliance with exemptive regulations issued under the Securities Act and any other governmental requirements or regulations) as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of Registerable Shares as are specified in such request; provided that Concorde shall not be obligated to take any action to effect such registration, qualification or compliance pursuant to this Section 53(c), after Concorde has effected one such registration pursuant to this Section 5.3(c) and such registration has been declared or ordered effective. Notwithstanding anything herein, this demand right shall terminate at such time as all Registerable Shares are freely tradeable in the public market, pursuant to Rule 144 under the Securities Act, or otherwise. (To be "freely tradeable" the Registerable Shares must be immediately saleable without regard to any trickle out limitations under Rule 144.) Subject to the foregoing, Concorde shall file a registration statement covering the Registerable Shares so requested to be registered as soon as practical, but in any event within ninety days, after receipt of the request or requests of CenCor; provided, however, that if Concorde shall furnish to CenCor a certificate signed by the President of Concorde stating that in the good faith judgment of the Board of Directors it would be seriously detrimental to Concorde and its stockholders for such registration statement to be filed at the date filing would be required and it is therefore essential to defer the filing of such registration statement, Concorde shall have an additional period of not more than ninety (90) days from the expiration of the foregoing ninety (90) day period within which to file such registration statement. (i) If CenCor intends to distribute the Registerable Shares covered by its request by means of an underwriting, it shall so advise Concorde as a part of its request made pursuant to Section 5.3(c). In such event, if so requested in writing by Concorde, CenCor shall negotiate with an underwriter selected by Concorde with regard to the underwriting of such requested registration; provided, however, that if CenCor has not agreed with such underwriter as to the terms and conditions of such underwriting within twenty days (20) following commencement of such negotiations, CenCor may select an underwriter of its own choice. Concorde shall enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by CenCor. (ii) All out-of-pocket expenses incurred in connection with any registration pursuant to this Section 5.3(c) shall be borne by CenCor. (d) In the case of registration pursuant to either Sections 5.3(b) or (c), Concorde will keep CenCor advised in writing as to the initiation of each registration, qualification and compliance and as to the completion thereof. Concorde will: (i) keep such registration, qualification or compliance pursuant to Sections 5.3(b) or (c) effective for a period of 120 days or until a distribution contemplated in the registration statement has been completed; provided, however that (i) such 120-day period shall be extended for a period of time equal to the period CenCor refrains from selling securities included in such registration at the request of an underwriter of common stock (or other securities) of Concorde; and (ii) in the case of any registration of Registerable Shares on Form S-3 which are intended to be offered on a continuous or delayed basis, such 120-day period shall be extended, if necessary, to keep the registration effective until all such Registerable Shares are sold, provided that Rule 145, or any successor rule under the Securities Act, permits an offering on a continuous or delayed basis, and provided further that applicable rules under the Securities Act governing the obligation to file a post-effective amendment permit, in lieu of filing a post-effective amendment which (i) includes any prospectus required by Section 10(a)(3) of the Securities Act or (ii) reflects facts or events representing a material or fundamental change in the information set forth in the registration statement, the incorporation by reference of information required to be included in (i) and (ii) above to be contained in periodic reports filed pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934, as amended ("1934 Act") and registration statement; and (ii) furnish such number of prospectuses and other documents incident thereto as CenCor from time to time may reasonably request. (e) Concorde will indemnify CenCor, each of CenCor's officers and directors, and each person controlling CenCor within the meaning of the Securities Act, with respect to such registration, qualification, or compliance effected pursuant to Sections 5.3(b) or (c), and each underwriter, if any, and each person who controls any underwriter of the Registerable Shares against all claims, losses, damages, and liabilities (or actions in respect thereto) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any prospectus, offering circular or other document (including any related registration statement, notification or the like) incident to any such registration, qualification, or compliance, or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or any violation by Concorde of any rule or regulation promulgated under the Securities Act applicable to Concorde and relating to action or inaction required of Concorde in connection with any such registration, qualification or compliance, and will reimburse CenCor, each of CenCor's officers and directors, and each person controlling CenCor, each such underwriter and each person who controls any such underwriter, for any legal and any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action, provided that Concorde will not be liable in any such case to the extent that any such claim, loss, damage or liability arises out of or is (i) based on any untrue statement or omission based upon written information furnished to Concorde by an instrument duly executed by CenCor or underwriter specifically for use therein or (ii) relating to action or inaction required of CenCor or any such underwriter under any rule or regulation promulgated under the Securities Act. CenCor will, if Registerable Shares held by or issuable to CenCor are included in the securities as to which such registration, qualification, or compliance is being effected, indemnify Concorde, each of Concorde's officers and directors, and each person controlling Concorde within the meaning of the Securities Act, with respect to such registration, qualification, or compliance effected pursuant to Sections 5.3(b) or (c), and each underwriter, if any, and each person who controls any underwriter of the Registerable Shares against all claims, losses, damages, and liabilities (or actions in respect thereto) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any such prospectus, offering circular, or other document (including any related registration statement, notification or the like) incident to any such registration, qualification, or compliance, or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or any violation by CenCor of any rule or regulation promulgated under the Securities Act applicable to CenCor and relating to action or inaction required of CenCor in connection with any such registration, qualification or compliance, and will reimburse Concorde, each of Concorde's offi- cers and directors, and each person controlling Concorde, each such underwriter and each person who controls any such underwriter, for any legal or any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability, or action, in each case to the extent, but only to the extent, (x) that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such registration statement, prospectus, offering circular, or other document in reliance upon and in conformity with written information famished to Concorde by an instrument duly executed by CenCor specifically for use therein or (y) that such violation was due to an action or inaction required of CenCor. Each party entitled to indemnification under this Section 5.3(e) (the Indemnified Party) shall give notice to the party required to provide indemnification (the Indemnifying Party) promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval shall not be unreasonably withheld), and the Indemnified Party may participate in such defense at such party's expenses, and provided further that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Section 5.3(e). No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation. (f) CenCor shall furnish to Concorde such written information regarding it and the distribution proposed by it as Concorde may request in writing and as shall be required in connection with any registration, qualification, or compliance referred to in this Section 5.3. (g) With a view to making available to CenCor the benefits of certain rules and regulations of the Securities and Exchange Commission ("SEC") which may permit the sale of the securities of Concorde to the public without registration or pursuant to a registration on Form S-3, Concorde agrees to: (i) make and keep public information available, as those terms are understood and defined in SEC Rule 144; (ii) use its best efforts to file with the SEC in a timely manner all reports and other documents required of Concorde under the Securities Act and the 1934 Act; and (iii) so long as CenCor owns any Class A Preferred Stock, Class A-1 Preferred Stock, or Registerable Shares, to furnish to CenCor forthwith upon its request a written statement by Concorde as to its compliance with the reporting requirements of said Rule 144, and of the Act and the 1934 Act, a copy of the most recent annual or quarterly report of the company, and such other reports and documents so filed by Concorde as CenCor may reasonably request in availing itself of any rule or regulation of the SEC allowing you to sell any such securities without registration. (h) The rights to cause Concorde to register the Registerable Shares granted to CenCor by Concorde under Sections 5.3(b) and (c) may be assigned by CenCor to a transferee or assignee of any of the Registerable Shares, provided, that Concorde is given written notice by CenCor at the time of or within a reasonable time after said transfer, stating the name and address of said transferee or assignee and identifying the securities with respect to which such registration rights are being assigned. (i) CenCor shall furnish to Concorde such written information regarding it and the distribution proposed by it as Concorde may request in writing and as shall be required in connection with any registration, qualification, or compliance referred to in Section 5.3(b) or (c). Representations, Warranties and Covenants of the Parties 6.1 Corporate Authority. Concorde hereby represents and warrants to CenCor that Concorde and the Guarantors have obtained all necessary corporate and other approvals and consents to enter into this Fourth Amendment and to take all actions contemplated herein. The Board of Directors of Concorde has approved this Fourth Amendment and all actions to be taken pursuant to this Fourth Amendment, including without limitation, the filing of the Class A-1 Certificate of Designation in the event the Repayment does not occur by February 28, 1997, or such later date as may be mutually agreed to in writing by CenCor and Concorde. 6.2 Stock. Concorde hereby represents and warrants to CenCor that (a) it does not own an interest in any entity other than its interest in the Guarantors and (b) all of the stock it owns in Guarantors has been or is hereby pledged as collateral for the Debenture Liabilities. Concorde and Guarantors hereby jointly and severally represent and warrant that the attached Exhibit "B" is a complete list of all stock issued by Guarantors and acknowledge that all such stock certificates have been delivered to CenCor. 6.3 Registration Rights. Concorde hereby represents and warrants that, except in connection with the issuance of Class B Preferred Stock pursuant to the Refinancing (the "Class B Registration Rights") or as otherwise provided for in this Fourth Amendment, it has not granted, or agreed to grant, any registration rights, including piggyback rights, to any person or entity. Furthermore, Concorde covenants that (a) prior to Closing, it will not grant or agree to grant any such rights to any person or entity other than CenCor, except for the Class B Registration Rights and (b) in the event the Closing does not occur by February 28, 1997, or by such later date as mutually agreed to in writing by CenCor and Concorde, Concorde will not grant or agree to grant any such rights to any person or entity other than CenCor. 6.4 Career. Career hereby guarantees to CenCor payment when due of all Debenture Liabilities and shall be deemed a Guarantor as defined in the Agreement. To secure this guaranty, Career hereby mortgages, pledges, conveys and assigns to CenCor, and grants CenCor a continuing security interest in all personal property of the following types which is now owned or hereafter shall be owned or acquired by Career, and all Proceeds of such property: All Equipment, Farm Products, Consumer Goods, Inventory, Fixtures, Accounts, Contract Rights, General Intangibles, Instruments, Documents, Chattel Paper and money (including money in bank accounts). If the Repayment does not occur by February 28, 1997, or by such other later date as may be mutually agreed to in writing by CenCor and Concorde, Career will execute any and all documents reasonably requested by CenCor to bind Career to all of the same obligations to CenCor as the Guarantors and all financing statements deemed necessary by CenCor to perfect CenCor's security interest in the above assets of Career. 6.5 CenCor's Corporate Authority. CenCor hereby represents and warrants to Concorde that it has obtained all necessary corporate and other approvals and consents to enter into this Fourth Amendment and to take all actions contemplated herein. The Board of Directors of CenCor has approved this Fourth Amendment and all actions to be taken pursuant to this Fourth Amendment, including without limitation, the cancellation of all the Obligations pursuant to the Repayment. Miscellaneous 7.1 Attorneys' Fees. Notwithstanding anything in the Agreement or herein to the contrary, Concorde shall pay to CenCor in cash one-half of CenCor's attorneys' fees and expenses incurred in connection with the negotiation of this Fourth Amendment and the consummation of the transactions contemplated thereby, within ten (10) business days after receiving an invoice from CenCor with supporting documentation, which payment the parties agree shall not exceed $5,000 in the aggregate. 7.2 Ratification. All provisions of the Agreement not specifically amended in this Fourth Amendment are hereby ratified and reaffirmed. 7.3 Governing Law. Except as otherwise provided by express reference to the Uniform Commercial Code, this Fourth Amendment shall be construed in accordance with and governed by the laws, statutes and decisions of the State of Missouri, to the nonexclusive jurisdiction of whose courts, state and federal, Concorde and Guarantors irrevocably agree to submit. 7.4 Incorporation. The recitals and exhibits hereto are hereby incorporated herein by reference. 7.5 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. 7.6 Further Assurances. The parties hereto agree to execute all additional documents reasonably necessary to effectuate the transactions contemplated herein, including without limitation those documents necessary to release the Liens on a timely basis. 7.7 Benefit and Burden. This Agreement shall be binding upon and inure to the benefit of the successors of CenCor, Concorde and the Restricted Subsidiaries. CenCor may assign its rights hereunder, including without limitation to a liquidating trust. IN WITNESS WHEREOF, the parties hereto have caused this Fourth Amendment to the Agreement to be executed by their respective duly authorized officers as of the day and year first above written. Oral agreements or commitments to loan money, extend credit or to forbear from enforcing repayment of a debt including promises to extend or renew such debt are not enforceable. To protect the debtor and creditor from misunderstanding or disappointment, any agreements we reach covering such matters are contained in this writing, which is the complete and exclusive statement of the agreement between us, except as we may later agree in writing to modify it. CENCOR, INC. ATTEST: /s/ :Lisa M. Henak By: /s/ Terri Rinne Secretary Terri Rinne Vice President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came Terri Rinne, Vice President of CenCor, Inc., a Delaware corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 CONCORDE CAREER COLLEGES, INC. ATTEST: /s/ Lisa M. Henak By: /s/ Gregg Gimlin Secretary M. Gregg Gimlin Vice President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came M. Gregg Gimlin, Vice President of Concorde Career Colleges, Inc., a Delaware corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 MINNESOTA INSTITUTE OF MEDICAL AND DENTAL ASSISTANTS, INC. ATTEST: /s/ Lisa M. Henak By: /s/ A. Eugene Johnson Secretary A. Eugene Johnson President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Minnesota Institute of Medical and Dental Assistants, Inc., a Minnesota corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 TEXAS COLLEGE OF MEDICAL AND DENTAL ASSISTANTS, INC. ATTEST: /s/ Lisa M. Henak By: /s/ A. Eugene Johnson Secretary A. Eugene Johnson President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Texas College of Medical and Dental Assistants, Inc., a Texas corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 UNITED HEALTH CAREERS INSTITUTE, INC. ATTEST: /s/ Lisa M. Henak By: /s/ A. Eugene Johnson Secretary A. Eugene Johnson President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of United Health Careers Institute, Inc., a California corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 SOUTHERN CALIFORNIA COLLEGE OF MEDICAL AND DENTAL ASSISTANTS, INC. ATTEST: /s/ Lisa M. Henak By: /s/ A. Eugene Johnson Secretary A. Eugene Johnson President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Southern California College of Medial and Dental Assistants, Inc., a California corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 CONCORDE CAREERS-FLORIDA, INC. ATTEST: /s/ Lisa M. Henak By: /s/ A. Eugene Johnson Secretary A. Eugene Johnson President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Concorde Careers- Florida, Inc., a Florida corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 COLLEGES OF DENTAL AND MEDICAL ASSISTANTS, INC. ATTEST: /s/ Lisa M. Henak By: /s/ A. Eugene Johnson Secretary A. Eugene Johnson President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Colleges of Dental and Medial Assistants, Inc., a California corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 COMPUTER CAREER INSTITUTE, INC. ATTEST: /s/ Lisa M. Henak By: /s/ A. Eugene Johnson Secretary A. Eugene Johnson President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came A. Eugene Johnson, President of Computer Career Institute, Inc., an Oregon corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 CAREER ASSISTANCE, INC. ATTEST: /s/ Lisa M. Henak By: /s/ A. Eugene Johnson Secretary A. Eugene Johnson President ACKNOWLEDGMENT STATE OF MISSOURI ) ) ss. COUNTY OF JACKSON ) BE IT REMEMBERED, that on this 30th day of December, 1996, before me, the undersigned, a notary public in and for said state, came Patrick J. Debold, President of Career Assistance, Inc., a Delaware corporation, to me personally known to be such officer and the same person who executed as such officer the foregoing instrument on behalf of said corporation, and such person duly acknowledged the execution of the same to be the act and deed of said corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal at my office in Kansas City, Missouri, the day and year last above mentioned. /s/ Lisa M. Henak Notary Public in and for said County and State My commission expires: 9/7/2000 EXHIBIT A CONCORDE CAREER COLLEGES, INC. Certificate of Designations of the Class A-1 Convertible Redeemable Voting Preferred Stock Par Value 0.10 Per Share Liquidation Value $10.00 Per Share _________________ Pursuant to Section 151 of the General Corporation Law of the State of Delaware The undersigned, the President of Concorde Career Colleges, Inc., a Delaware corporation (hereinafter called the "Corporation"), DOES HEREBY CERTIFY that: I. The following resolution has been duly adopted by the Board of Directors of the Corporation (the "Board of Directors"): RESOLVED, that pursuant to the authority expressly granted to and vested in the Board of Directors of the Corporation by the provisions of the Restated Certificate of Incorporation, as amended, and the Amended and Restated Bylaws, the Board of Directors hereby authorizes the issuance of a series of the preferred stock (the "Preferred Stock") of the Corporation which shall consist of (260,385) shares of the Corporation's Preferred Stock and hereby fixes the designations, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions thereof of the shares of such series as follows: A. Designation. The designation of said series of the Preferred Stock shall be Class A-1 Convertible Redeemable Voting Preferred Stock (the "Class A-1 Preferred Stock"). The number of shares of Class A-1 Preferred Stock shall be (260,385) . The liquidation value of the Class A-1 Preferred Stock shall be $10.00 per share. The shares of Class A-1 Preferred Stock shall be issued as full shares. B. Dividends. The shares of Class A-1 Preferred Stock shall be entitled to receive cumulative dividends, as declared by the Board of Directors or a duly authorized committee thereof (an "Authorized Board Committee"), out of funds legally available for the payment of dividends, (the "Dividends") and at a variable annual rate, all as set forth in this Section (ii). (a) For so long as the Corporation's junior secured debenture, dated October 30, 1992 and issued in the original principal amount of $5,422,307 (the "Debenture"), or any portion of the principal amount thereof, is outstanding, the annual rate of the Dividend shall be equal to 73% of the current interest rate on the Debenture, as of the first day of calendar quarter during which the Dividend is earned, as calculated based on the liquidation value of the Class A-1 Preferred Stock set forth in Section (v), below; (b) commencing upon the retirement, in full, of the Debenture (the "Debenture Repayment Date"), the annual rate of the Dividend shall be equal to 2% above the prime rate charged, as of the first day of the calendar quarter during which the Dividend is earned, by Mercantile Bank of Kansas City, N.A., as calculated based on the liquidation value of the Class A-1 Preferred Stock set forth in Section (v), below; (c) provided that, notwithstanding the foregoing, the annual rate of the Dividends shall not exceed 12% of the per share liquidation value of the Class A-1 Preferred Stock, as set forth in Section (v), below ($1.20 per share). Dividends shall be earned from date of original issue of a share of Class A-1 Preferred Stock, however they shall not be paid, but rather accrued until the Debenture Repayment Date (the "Initial Accrued Dividends"). Upon the Debenture Repayment Date, future earned Dividends shall be payable in cash, commencing on the last day of the calendar quarter which occurs following the Debenture Repayment Date (the "Initial Dividend Payment Date") with respect to the period commencing on the Debenture Repayment Date and ending the day prior to the Initial Dividend Payment Date, and thereafter quarterly on March 31, June 30, September 30 and December 31 in each year (the "Dividend Payment Dates") with respect to the quarterly period ending on the March 30, June 29, September 29 and December 30, respectively, next preceding such Dividend Payment Date, to stockholders of record on the record date, not exceeding sixty days preceding the Initial Dividend Payment Date or such Dividend Payment Date, respectively, fixed for the purpose by the Board of Directors or an Authorized Board Committee in advance of each particular dividend. The amount of dividends payable on shares of Class A-1 Preferred Stock, for each full quarterly dividend period, shall be computed by dividing by four the annual rate per share set forth in this Section (ii). The Initial Accrued Dividends shall be paid ratably over 12 calendar quarters, commencing with the calendar quarter which ends immediately after the Debenture Repayment Date. Payment of the Initial Accrued Dividends shall be made on the Initial Dividend Payment Date and the following 11 Dividend Payment Dates, to stockholders of record on the respective record dates for such Dividend Payment Dates. Notice of the current rate of Dividends, which shall detail the basis for such determination, shall be given by the Corporation on a quarterly basis to the holders of record of the shares of Class A-1 Preferred Stock as of the record date for such Dividends, at their respective addresses appearing on the books of the Corporation. Such notice shall be given on each Dividend Payment Date (including the Initial Dividend Payment Date), and, prior to the Debenture Repayment Date, shall be given each December 31, March 31, June 30 and September 30. Notice of the Debenture Repayment Date shall be given by the Corporation, promptly upon its determination, to the holders of record of the shares of Class A-1 Preferred Stock on such date, at their respective addresses appearing on the books of the Corporation. Dividends payable on the Class A-1 Preferred Stock for the initial dividend period and for any other period which is less than a full quarterly period shall be computed on the basis of a 360-day year of twelve 30-day months. (iii) Right of Conversion. Any holder of Class A-1 Preferred Stock at any time, and from time to time, may at its option convert all, or any number less than all, of the shares of Class A-1 Preferred Stock into shares of the Corporation's common stock, $.10 par value (the "Common Stock") on the basis of one (1) share of Class A-1 Preferred Stock for eight (8) shares of Common Stock. In the event of a merger, consolidation, recapitalization or other reorganization, including any stock splits, reverse stock splits, or stock dividends, affecting the Common Stock (the "Reorganization") the right to convert the Class A-1 Preferred Stock shall be automatically modified to provide that each share of Class A-1 Preferred Stock shall be convertible into such reciprocally adjusted number of shares of Common Stock, or such other consideration as a holder of eight (8) shares of Common Stock would be entitled to receive as a result of any such Reorganization. Any holder desiring to effect such a conversion shall provide notice to the Corporation of the conversion by delivering stock certificates representing the shares of Class A-1 Preferred Stock to be converted to the Corporation, duly endorsed, with an instruction -letter requesting conversion. The effective date of any such conversion shall be the date the Corporation actually receives such notice and certificate(s) duly endorsed (the "Conversion Date"). Upon such receipt, the Corporation shall promptly transmit instructions to its transfer agent to issue to such holder certificate(s) representing the Common Stock, as of the Conversion Date. In the event less than all the shares of Class A-1 Preferred Stock represented by the tendered certificate are to be converted, the Corporation will cause a new certificate, representing the unconverted shares of Class A-1 Preferred Stock, to be issued to such holder. All shares of Class A-1 Preferred Stock which shall at any time have been converted shall, after such conversion, have the status of authorized but unissued shares of Preferred Stock, without designation as to series until such shares are once more designated as part of a particular series by the Board of Directors or an Authorized Board Committee. (iv) Optional Redemption. The Corporation at any time and from time to time may at its option redeem all, or any number less than all, of the outstanding shares of Class A-1 Preferred Stock. Any redemption of shares of Class A-1 Preferred Stock shall be effected at a redemption price of $10.00 per share plus, in each case, an amount equal to all dividends (whether or not earned or declared) accrued and unpaid on such share of Class A-1 Preferred Stock to the date fixed for redemption. Notice of any proposed redemption of shares of Class A-1 Preferred Stock shall be given by the Corporation by mailing a copy of such notice no less than 20 days nor more than 60 days prior to the date fixed for such redemption to holders of record of the shares of Class A-1 Preferred Stock to be redeemed at their respective addresses appearing on the books of the Corporation. Said notice shall specify the shares called for redemption, the redemption price and the place at which and date on which the shares called for redemption will, upon presentation and surrender of the certificates of stock evidencing such shares, be redeemed and the redemption price therefor paid. In the case of the redemption of less than all the outstanding shares of Class A-1 Preferred Stock, such redemption shall be of full shares selected by lot among all then outstanding Class A-1 Preferred Stock in such manner as may be prescribed by the Board of Directors. From and after the date fixed in any such notice as the date of redemption of shares of Class A-1 Preferred Stock, unless default shall be made by the Corporation in providing monies at the time and place specified for the payment of the redemption price pursuant to such notice, all dividends on the Class A-1 Preferred Stock thereby called for redemption shall cease to accrue and all rights of the holders thereof as stockholders of the Corporation, except the right to receive the redemption price, shall cease and terminate. All shares of Class A-1 Preferred Stock which shall at any time have been redeemed shall, after such redemption, have the status of authorized but unissued shares of Preferred Stock, without designation as to series until such shares are once more designated as part of a particular series by the Board of Directors or an Authorized Board Committee. (v) Priority of Class A-1 Preferred Stock. The shares of Class A-1 Preferred Stock shall be preferred as to assets over the shares of the Common Stock or any other capital stock of the Corporation ranking junior to the Class A-1 Preferred Stock upon liquidation, dissolution or winding up of the Corporation so that in the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the holders of the Class A-1 Preferred Stock shall be entitled to receive out of the assets of the Corporation available for distribution to its stockholders, whether from capital, surplus or earnings, after distribution and payment in full to the holders of any capital stock of the Corporation ranking prior to the Class A-1 Preferred Stock upon liquidation, dissolution or winding up of the Corporation of the preferential amounts and dividends payable thereon, and before any distribution is made to holders of shares of the Common Stock or any other capital stock of the Corporation ranking junior to the Class A-1 Preferred Stock upon liquidation, dissolution or winding up of the Corporation, an amount equal to $10.00 per share plus an amount equal to all dividends (whether or not earned or declared) accrued and unpaid on such share of Class A-1 Preferred Stock to the date of final distribution. If, upon any liquidation, dissolution or winding up of the Corporation, the assets of the Corporation, or proceeds thereof, distributable among the holders of shares of Class A-1 Preferred Stock or any capital stock ranking on a par with the Class A-1 Preferred Stock upon liquidation, dissolution or winding up of the Corporation, shall be insufficient to pay in full the preferential amounts to which such stock would be entitled, then such assets, or the proceeds thereof, shall be distributable among such holders ratably in accordance with the respective amounts which would be payable on such shares if all amounts payable thereof were payable in full. For the purposes hereof, neither a consolidation nor a merger of the Corporation with one or more other corporations, nor a sale or a transfer of all or substantially all of the assets of the Corporation, shall be deemed to be a liquidation, dissolution or winding up, voluntary or involuntary, of the Corporation. (vi) Voting Rights. Each share of Class A-1 Preferred Stock shall be entitled to vote on all matters presented to the stockholders of the Corporation and shall be entitled to eight (8) votes for each vote afforded to a share of Common Stock. In the event of a recapitalization of the Corporation that would result in the multiplication or division of the voting power of the outstanding Common Stock (i.e., through a stock split, reverse stock split, or otherwise), the proportionate voting power of the Class A-1 Preferred Stock shall be reciprocally adjusted upward or downward as the case may be. Additionally, notwithstanding anything herein to the contrary, so long as any shares of the Class A-1 Preferred Stock remain outstanding, the Corporation will not, either directly or indirectly or through merger or consolidation with any other corporation, without the affirmative unanimous vote at a meeting, or the written consent with or without a meeting, of the holders of the shares of Class A-1 Preferred Stock then outstanding, amend, alter or repeal any of the provisions of the Certificate of Designations of the Class A-1 Preferred Stock or the certificate of Incorporation of the Corporation, or authorize any reclassification of the Class A-1 Preferred Stock, so as in any such case to affect adversely the preferences, special rights or powers of the Class A-1 Preferred Stock, including but not limited to the super voting rights afforded pursuant to the first paragraph of this Section (vi), or authorize or issue any capital stock of the Corporation ranking, either as to payment of dividends or upon liquidation, dissolution or winding up of the Corporation, prior to or on par with the Class A-1 Preferred Stock. Additionally, notwithstanding anything herein to the contrary, so long as any shares of the Class A-1 Preferred Stock remain outstanding, the Corporation will not, either directly or indirectly or through merger or consolidation with any other corporation, without the affirmative unanimous vote at a meeting, or the written consent with or without a meeting, of the holders of the shares of Class A-1 Preferred Stock then outstanding, increase the authorized number of shares of Class A-1 Preferred Stock, increase the authorized number of shares of Preferred Stock or create, or increase the authorized number of shares of, any other class of capital stock of the Corporation ranking on a parity with the Class A-1 Preferred Stock either as to payment of dividends or upon liquidation, dissolution or winding up of the Corporation. No consent of holders of the Class A-1 Preferred Stock shall be required for (a) the creation of any indebtedness of any kind of the Corporation, or (b) the issuance of any class of capital stock of the Corporation ranking junior to the Class A-1 Preferred Stock in payment of dividends and upon liquidation, dissolution or winding up of the Corporation. (vii) Amendment. The Board of Directors reserves the right by subsequent amendment of this resolution from time to time to decrease the number of shares which constitute the Class A-1 Preferred Stock (but not below the number of shares thereof then outstanding) and, subject to anything to the contrary set forth in the Restated Certificate of Incorporation, as amended, of the Corporation applicable to the Preferred Stock, to subdivide the number of shares, the par value per share and the liquidation value per share of the Class A-1 Preferred Stock, and in other respects to amend, within the limitations provided by law, this resolution and the Restated Certificate of Incorporation, as amended, of the Corporation. IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly executed on its behalf by its undersigned President and attested to by its Secretary this ______ day of December, 1996. _________________________________ Jack L. Brozman, President [Corporate Seal] ATTEST: _____________________________ ___________________, Secretary EXHIBIT B CenCor, Inc. Concorde Career Colleges, Inc. Stock Certificate Holdings 1. United Health Careers Institute, Inc. - California - 120 shares 2. Southern California College of Medical and Dental Assistants, Inc. - California - 100 shares 3. Southern California College of Medical and Dental Assistants, Inc. - California - 180 shares 4. Concorde Careers - Florida, Inc. - Florida - 1,000 shares 5. Colleges of Dental & Medical Assistants, Inc. - California - 180 shares * 6. Computer Career Institute, Inc. - Oregon - 250 shares 7. Career Assistance, Inc. - Missouri - 250,000 shares * CERTIFICATE STILL NEEDS TO BE DELIVERED TO CENCOR EX-21 5 EX-21 CENCOR, INC. AND SUBSIDIARIES SUBSIDIARIES OF THE REGISTRANT Century Acceptance Corporation, 100% owned The Company is in the process of dissolving Century's subsidiaries. Although the following subsidiaries were inactive during 1996, they remain incorporated at December 31, 1996: Name State of Incorporation Century Finance Company of Colorado Colorado Century Finance Company of Missouri Missouri Century Finance Company of Omaha, Inc Nebraska Century Finance Company of Oklahoma, Inc. Oklahoma Century Finance Company of Tennessee Tennessee Century Acceptance Corporation of Texas Texas Century Finance Company of Utah Utah EX-27 6
5 DEC-31-1996 DEC-31-1996 YEAR $14,513,000 0 0 0 0 10,320,000 0 0 24,833,000 1,758,000 5,681,000 1,488,411 0 0 15,905,589 24,833,000 0 2,635,000 0 0 1,024,000 0 1,052,000 (716,000) 1,275,000 (716,000) 0 0 0 (716,000) $(.48) $(.48)
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