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                                                                    EXHIBIT 4.08

            WAIVER AND THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT
                                    AGREEMENT

          This Waiver and Third Amendment to the Amended and Restated Credit
Agreement (the "Third Amendment") is dated as of April 30, 2003, and is made by
and among EDUCATION MANAGEMENT CORPORATION, (the "Borrower"), the BANKS under
the Credit Agreement (as hereafter defined), NATIONAL CITY BANK OF PENNSYLVANIA
(the "Agent"), as the Agent for the Banks and Issuing Bank, WACHOVIA BANK, as
Syndication Agent, SUNTRUST BANK, as Syndication Agent, FLEET NATIONAL BANK, as
Documentation Agent, and J.P. MORGAN CHASE BANK, as Documentation Agent.

                                    RECITALS:

          WHEREAS, the Borrower, the Banks and the Agent entered into that
certain Amended and Restated Credit Agreement dated as of September 20, 2001, as
amended by a First Amendment thereto dated as of February 15, 2002 and a Second
Amendment thereto dated as of August 19, 2002 (as amended, modified, extended or
restated from time to time, the "Credit Agreement");

          WHEREAS, Section 6.6(ix) of the Credit Agreement permits indebtedness
for Borrowed Money in connection with real estate financings provided that
neither the Borrower nor any Subsidiary of Borrower shall Guarantee any such
Indebtedness for Borrowed Money. In connection with Borrower's acquisition of
Argosy, Borrower has acquired a Subsidiary, Argosy, who has guarantied
Indebtedness for Borrowed Money of its Subsidiary, Western State University
College of Law ("WSU"), in connection with real estate financings, as more fully
described in that certain memorandum delivered by Borrower to Agent and the
Banks on April     , 2003 (collectively, the "Guarantee Memo") and the Borrower
               ----
has requested that the Banks waive the requirement that Borrower comply with the
covenant set forth in Section 6.6(ix) for the period beginning on the effective
date of the Borrower's acquisition of Argosy to date hereof and amend such
covenant to permit such Guarantee for periods after the date hereof, subject to
the terms and conditions hereof;

          NOW, THEREFORE, in consideration of the foregoing and intending to be
legally bound, the parties hereto agree as follows:

                                   AGREEMENT:

          1. Capitalized terms used herein and not otherwise defined shall have
the meanings given to them under the Credit Agreement.

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          2. The Banks and the Loan Parties hereby amend and restate subsection
(ix) of Section 6.6 in its entirety to read as follows:

               "(ix) Indebtedness for Borrowed Money in a principal amount of up
to $25,000,000 in the aggregate outstanding in connection with real estate
financings and sale and lease-back real estate transactions (other than sale and
lease-back transactions prohibited by Section 6.5 above), including, without
limitation, any reimbursement obligations incurred with respect to a bond
financing that is secured by real estate, provided that, neither the Borrower
nor any Subsidiary of the Borrower shall Guarantee any Indebtedness for Borrowed
Money permitted under this Subsection (other than the Guarantee by Argosy of the
Indebtedness for Borrowed Money of WSU in favor of Union Bank of California in
connection with a real estate financing of real property owned by WSU, solely to
the extent that the aggregate principal amount of such Indebtedness subject to
such Guarantee does not exceed $3,450,000) and, further provided that, if such
Indebtedness for Borrowed Money is incurred by a Subsidiary, the Subsidiary
shall execute a Subsidiary Guarantee."

The remainder of Section 6.6 is unchanged hereby.

          3. The Banks hereby waive non-compliance with Section 6.6(ix) of the
Credit Agreement from the date of the Borrower's acquisition of Argosy to the
date hereof, to the extent that such non-compliance was created solely by (a)
the Guarantee by Argosy of the Indebtedness for Borrowed Money in favor of WSU
as more fully described in the Guarantee Memo and (b) the failure of WSU to
execute and deliver to the Agent for the benefit of the Banks a Subsidiary
Guaranty as required by Section 6.6(ix) of the Credit Agreement, provided that
the Borrower hereby represents, warrants and covenants that: (i) Borrower's
non-compliance with Section 6.6(ix) was created solely by the Guarantee
described in clause (a) above (the circumstances giving rise to such Guarantee
are as described in the Guarantee Memo), and the failure to provide a Subsidiary
Guaranty described in clause (b) above, and (ii) the aggregate principal amount
of Indebtedness for Borrowed Money Guaranteed thereunder does not and will not
exceed $3,450,000. Any breach of the warranties and covenants contained in
clauses (i) or (ii) of the preceding sentence shall constitute an Event of
Default under the Credit Agreement. The Banks do not amend, modify or waive the
covenant contained in Section 6.6(ix) for periods prior to the date of the
Borrower's acquisition of Argosy or after the date hereof except as expressly
set forth herein.

          4. The Borrower represents and warrants that (after giving effect to
the waiver set forth in paragraph 3 above and the delivery by WSU to the Agent
of a Subsidiary Guaranty as required by paragraph 12 below) the Loan Parties are
in full compliance with each of the provisions of the Credit Agreement and that
no Default or Event of Default exists (after giving effect to the waiver set
forth in Paragraphs 3 above and the delivery by WSU to the Agent of a Subsidiary
Guaranty as required by paragraph 12 below). The Banks do not waive any
provisions of the Credit Agreement, except as expressly set forth herein. All
terms of the Credit Agreement and each of the other Loan Documents remain in
full force and effect on and after the date hereof except as provided herein.

                                        2

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          5. The Borrower warrants that the Guarantee Memo is true and correct
in all material respects.

          6. By its execution below, the Borrower acknowledges and agrees that
except as set forth in this Third Amendment and the documents executed and
delivered in connection herewith or in connection with the Credit Agreement, the
Credit Agreement and the other Loan Documents and all obligations thereunder
remain in full force and effect with respect to the Bank Indebtedness.

          7. The Credit Agreement, the Loan Documents and all prior amendments
and modifications thereto are hereby modified solely to the extent that any of
the terms or provisions thereof are irreconcilably inconsistent with the terms
and provisions of this Third Amendment.

          8. The Recitals set forth above are incorporated herein by reference
and made a part hereof, and the Borrower represents, warrants and attests to the
veracity thereof as well as to the veracity of the representations set forth in
the Credit Agreement as of the date hereof (except representations which
expressly relate solely to an earlier date or time, which representations shall
be true as of the specific dates or times referred to therein).

          9. The Borrower represents that this Third Amendment has been duly
executed and delivered by the Borrower and constitutes the legal, valid and
binding obligations of the Borrower, enforceable against the Borrower in
accordance with its terms, except to the extent that the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws affecting the enforceability of creditors
rights generally or by general equitable principles.

          10. Neither this Third Amendment nor the consummation of the
transactions contemplated herein nor the performance by the Borrower of its
obligations hereunder will (i) violate any law, rule or regulation or court
order to which the Borrower is subject; (ii) conflict with or result in a breach
of the Borrower's articles of incorporation or bylaws or any material agreement
or instrument to which any Borrower is subject or by which its properties are
bound or (iii) result in the creation or imposition of any lien, security
interest or encumbrance on the property of any Borrower, whether now owned or
hereafter acquired, other than liens in favor of Agent for the benefit of the
Lenders.

          11. This Third Amendment may be executed by different parties hereto
on any number of separate counterparts, each of which, when so executed and
delivered, shall be an original, and all such counterparts shall together
constitute one and the same instrument.

          12. This Third Amendment shall become effective when (i) it has been
executed and delivered by the Borrower, the Required Banks and the Agent and
(ii) a Subsidiary Guaranty in form and substance acceptable to the Agent has
been executed and delivered by WSU to the Agent.

                                        3

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                         [SIGNATURES BEGIN ON NEXT PAGE]

                                        4

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                   [SIGNATURE PAGE 1 OF 9 TO THIRD AMENDMENT]

     Executed as of the day and year first above written.

                                          EDUCATION MANAGEMENT CORPORATION


                                          By /s/ Kristen Gribble
                                             -----------------------------------
                                          Kristen Gribble, Treasurer

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                   [SIGNATURE PAGE 2 OF 9 TO THIRD AMENDMENT]

                                          NATIONAL CITY BANK OF PENNSYLVANIA,
                                          individually and as Agent


                                          By /s/ John L. Hayes, IV
                                             -----------------------------------
                                          John L. Hayes, IV, Vice President

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                   [SIGNATURE PAGE 3 OF 9 TO THIRD AMENDMENT]

                                          WACHOVIA BANK, NATIONAL ASSOCIATION,
                                          individually and as Syndication Agent


                                          By /s/ Patrick J. Kaufmann
                                             -----------------------------------
                                          Patrick J. Kaufmann, Vice President

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                   [SIGNATURE PAGE 4 OF 9 TO THIRD AMENDMENT]

                                          SUNTRUST BANK, individually and as
                                          Syndication Agent


                                          By /s/ Stephen Derry
                                             -----------------------------------
                                          Stephen Derry, Director

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                   [SIGNATURE PAGE 5 OF 9 TO THIRD AMENDMENT]

                                          FLEET NATIONAL BANK, individually
                                          and as Documentation Agent


                                          By /s/ Edward McKenney
                                             -----------------------------------
                                          Edward McKenney, Senior Vice President

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                   [SIGNATURE PAGE 6 OF 9 TO THIRD AMENDMENT]

                                          JPMORGAN CHASE BANK, individually
                                          and as Documentation Agent


                                          By /s/ John Malone
                                             -----------------------------------
                                          John Malone, Vice President

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                   [SIGNATURE PAGE 7 OF 9 TO THIRD AMENDMENT]

                                          BANK ONE, MICHIGAN


                                          By /s/ Mahua Thakurta
                                             -----------------------------------
                                          Manhua Thakurta, Associate Director

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                   [SIGNATURE PAGE 8 OF 9 TO THIRD AMENDMENT]

                                          FIFTH THIRD BANK


                                          By /s/ Christopher S. Helmeci
                                             -----------------------------------
                                          Christopher S. Helmeci, Vice President

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                   [SIGNATURE PAGE 9 OF 9 TO THIRD AMENDMENT]

                                          AMERISERV FINANCIAL BANK


                                          By /s/ Mitchell D. Edwards
                                             -----------------------------------
                                          Mitchell D. Edwards, Vice President