Educational Development Corporation Announces Completion of Corporate Headquarters Sale for 32.2 Million

Rhea-AI Summary

Educational Development Corporation (NASDAQ: EDUC) completed the sale of its headquarters and distribution warehouse (the "Hilti Complex") on October 27, 2025 for $32,200,000. Proceeds were used to pay off the Company's term loans and revolving loan under its bank Credit Agreement, eliminating outstanding bank borrowings.

The company assigned third-party tenant leases to the buyer, executed a separate triple-net lease for its occupied space, and retained a 17-acre adjacent land parcel valued at $2.0 million. Management estimates the transaction will improve annual cash flow by approximately $1.0 million and expects further cash-flow gains as excess inventory is converted to cash.

Positive

• $32.2M sale proceeds used to fully eliminate bank debt
• Estimated $1.0M annual cash-flow improvement
• Retained adjacent 17-acre land valued at $2.0M
• Assigned third-party tenant leases, maintaining rental income continuity

Negative

• Surrendered ownership of the Hilti Complex (removes $32.2M asset from balance sheet)
• Entered a triple-net lease, creating ongoing occupancy expense obligations

Insights

Corporate Finance Analyst

Sale eliminates bank debt, boosts annual cash flow by about $1.0 million, and strengthens the balance sheet.

The company sold the Hilti Complex for $32,200,000 and used the proceeds to pay off its Term Loans and Revolving Loan, removing outstanding principal and interest obligations. Eliminating bank borrowings reduces fixed financing costs and interest-rate exposure and converts an illiquid asset into cash while the company remains an occupant under a new Triple-Net Lease.

Key dependencies and risks include the cost and terms of the new lease (which shift some operating responsibilities and reduce asset ownership benefits) and the company’s ability to convert excess inventory into cash as stated; these affect sustainability of the reported $1.0 million annual cash-flow improvement. Monitor the company’s upcoming cash-flow statements and any disclosures on lease terms and inventory disposition over the next 12 months for confirmation of the projected benefits.

Real Estate and Operations Analyst

Transaction monetizes a long-held property, retains strategic land valued at $2.0 million, and transfers tenancy to the buyer.

By assigning third-party tenant leases to the buyer and signing a Triple-Net Lease for its occupied space, the company shifts property-level operating responsibilities to the buyer while preserving occupancy continuity. Retaining the adjacent 17-acre tract valued at $2.0 million preserves optionality and a reported balance-sheet enhancement.

Operationally, the market impact depends on the Triple-Net Lease terms, tenant rent roll stability, and the timing of converting excess inventory into cash; these factors will determine net operating cash generation and flexibility. Watch for disclosures of lease duration, rent escalation clauses, and the schedule for inventory liquidation over the next several quarters to validate expected improvements.

Use of Proceeds to Eliminate Outstanding Debt

Tulsa, Oklahoma--(Newsfile Corp. - October 28, 2025) - Educational Development Corporation (NASDAQ: EDUC) ("EDC", the "Company" or "Seller") (http://www.edcpub.com) announced that on October 27, 2025, Educational Development Corporation completed the sale of the Company's headquarters and distribution warehouse located at 5400-5402 South 122^nd East Avenue, Tulsa, Oklahoma 74146 (the "Hilti Complex") to 10Mark 10K Industrial, LLC, a Delaware limited liability company ("Buyer").

The agreed upon sale price of the Hilti Complex per the executed Contract totaled $32,200,000. The proceeds from the sale were utilized to pay off the Term Loans and Revolving Loan outstanding in the Credit Agreement with the Company's Bank. At closing, EDC assigned the existing third-party tenant leases to the Buyer and executed separate Triple-Net Lease (the "Lease") for its occupied space in the Hilti Complex.

Per Craig White, President and Chief Executive Officer of Educational Development Corporation, "Today, I am pleased to announce that we have closed on the long-awaited sale of the Hilti Complex which strengthens our cash flows and ultimately our business. The proceeds from the sale were used to pay back all of our outstanding balances owed with our bank and allows us to get back to business as usual."

"Selling the Hilti Complex and fully eliminating our bank borrowings is a strategic achievement for our Company and our shareholders. This transaction capitalized on the appreciated value of the building and further strengthened our financial position. With no remaining principal and interest payments, offset by our new lease and rental income from past tenants, our annual cash flow generation will immediately improve by approximately $1.0 million. In addition, we retained the 17-acre tract of excess land adjacent to the complex, valued at $2.0 million, further enhancing our balance sheet. We also expect our continued improvement in cash flow from operations over the next several years, as we convert excess inventory into cash."

About Educational Development Corporation (EDC)

EDC began as a publishing company specializing in books for children. EDC is the owner and exclusive publisher of Kane Miller Books ("Kane Miller"); Learning Wrap-Ups, maker of educational manipulatives; and SmartLab Toys, maker of STEAM-based toys and games. EDC is also the exclusive United States MLM distributor of Usborne Publishing Limited ("Usborne") children's books. EDC-owned products are sold via 4,000 retail outlets and EDC and Usborne products are offered by independent brand partners who hold book showings through social media, book fairs with schools and public libraries, in individual homes, as well as other in-person events and internet sales.

Contact:
Educational Development Corporation
Craig White, (918) 622-4522

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/272293

FAQ

What did EDUC announce on October 27, 2025 regarding its headquarters?

EDUC sold the Hilti Complex on October 27, 2025 for $32.2 million and used proceeds to pay off its bank term loans and revolver.

How will the $32.2M sale affect EDUC's cash flow and debt position?

The sale eliminated outstanding bank borrowings and is expected to improve annual cash flow by about $1.0 million.

Did EDUC retain any property after the Hilti Complex sale?

Yes; EDUC retained a 17-acre tract adjacent to the complex valued at approximately $2.0 million.

What lease arrangements did EDUC enter after selling the Hilti Complex?

EDUC assigned existing tenant leases to the buyer and executed a separate triple-net lease for the space it continues to occupy.

Will the sale of the Hilti Complex dilute EDUC shareholders or issue new equity?

No equity issuance or shareholder dilution was disclosed; proceeds were applied to repay bank debt.