Exhibit 10.4


 


	
  Guaranty and Suretyship Agreement

  	
  

  



 


THIS GUARANTY AND
SURETYSHIP AGREEMENT (this “Guaranty”) is
made and entered into as of October 1, 2008, by and among the Guarantors
identified as such on the signature pages hereof (each individually, a “Guarantor” and, collectively, the “Guarantors”),
in consideration of the extension of credit by PNC BANK,
NATIONAL ASSOCIATION (the “Bank”), with
an address at 1600 Market Street, 22nd Floor, Philadelphia, PA
19103, to NEW HORIZONS WORLDWIDE, INC. (the “Borrower”), and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged.


 


1.             Guaranty of Obligations.  Each Guarantor hereby unconditionally guarantees, as a
primary obligor, and becomes surety for, the prompt payment and performance of
all loans, advances, debts, liabilities, obligations, covenants and duties
owing by the Borrower to the Bank under the Loan Agreement, dated as of
Ocotober 1, 2008, by and between the Borrower and the Bank (the “Loan Agreement”), the Committed Line of
Credit Note, dated as of October 1, 2008, made by the Borrower in favor of
the Bank, and any other related loan documents (collectively, the “Loan Documents”), of any kind or nature,
present or future (including any interest accruing thereon after maturity, or
after the filing of any petition in bankruptcy, or the commencement of any
insolvency, reorganization or like proceeding relating to the Borrower, whether
or not a claim for post-filing or post-petition interest is allowed in such proceeding),
whether direct or indirect absolute or contingent, joint or several, due or to
become due, now existing or hereafter arising, and any amendments, extensions,
renewals and increases of or to any of the foregoing, and all reasonable
out-of-pocket costs and expenses of the Bank incurred in the documentation,
negotiation, modification, enforcement, collection and otherwise in connection
with any of the foregoing, including reasonable attorneys’ fees and expenses
(hereinafter referred to collectively as the “Obligations”).  If the Borrower defaults under any such
Obligations, the Guarantor will pay the amount due to the Bank.


 


2.             Nature of Guaranty; Waivers.  This
is a guaranty of payment and not of collection and the Bank shall not be
required, as a condition of the Guarantors’ liability, to make any demand upon
or to pursue any of its rights against the Borrower, or to pursue any rights
which may be available to it with respect to any other person who may be liable
for the payment of the Obligations.


 


This is an absolute,
unconditional, irrevocable and continuing guaranty and will remain in full
force and effect until all of the Obligations have been indefeasibly paid in
full, and the Bank has terminated this Guaranty. This Guaranty will remain in
full force and effect even if there is no principal balance outstanding under
the Obligations at a particular time or from time to time.  This Guaranty will not be affected by any
surrender, exchange, acceptance, compromise or release by the Bank of any other
party, or any other guaranty or any security held by it for any of the
Obligations, by any failure of the Bank to take any steps to perfect or
maintain its lien or 


 

















 


security interest in or to
preserve its rights to any security or other collateral for any of the
Obligations or any guaranty, or by any irregularity, unenforceability or
invalidity of any of the Obligations or any part thereof or any security or
other guaranty thereof.  Each Guarantor’s
obligations hereunder shall not be affected, modified or impaired by any
counterclaim, set-off, recoupment, deduction or defense based upon any claim
such Guarantor may have (directly or indirectly) against the Borrower or the
Bank, except payment or performance of the Obligations.


 


Notice of acceptance of this
Guaranty, notice of extensions of credit to the Borrower from time to time,
notice of default, diligence, presentment, notice of dishonor, protest, demand
for payment, and any defense based upon the Bank’s failure to comply with the
notice requirements under Sections 9-611 and 9-612 of the Uniform Commercial
Code as in effect from time to time are, to the extent permissible under
applicable law, hereby waived.  Each
Guarantor waives all defenses based on suretyship or impairment of collateral.


 


The Bank at any time and
from time to time, without notice to or the consent of the Guarantors, and
without impairing or releasing, discharging or modifying the Guarantors’
liabilities hereunder, may (a) change the manner, place, time or terms of
payment or performance of or interest rates on, or other terms relating to, any
of the Obligations; (b) renew, substitute, modify, amend or alter, or
grant consents or waivers relating to any of the Obligations, any other
guaranties, or any security for any Obligations or guaranties; (c) apply
any and all payments by whomever paid or however realized including any
proceeds of any collateral, to any Obligations of the Borrower in such order,
manner and amount as the Bank may determine in its sole discretion; (d) settle,
compromise or deal with any other person, including the Borrower or the
Guarantors, with respect to any Obligations in such manner as the Bank deems
appropriate in its sole discretion; (e) substitute, exchange or release
any security or guaranty; or (f) take such actions and exercise such
remedies hereunder as provided herein.


 


3.             Repayments or Recovery from the Bank.  If
any demand is made at any time upon the Bank for the repayment or recovery of
any amount received by it in payment or on account of any of the Obligations
and if the Bank repays all or any part of such amount by reason of any
judgment, decree or order of any court or administrative body or by reason of
any settlement or compromise of any such demand, the Guarantors will be and
remain liable hereunder for the amount so repaid or recovered to the same
extent as if such amount had never been received originally by the Bank.  The provisions of this section will be and
remain effective notwithstanding any contrary action which may have been taken
by the Guarantors in reliance upon such payment, and any such contrary action
so taken will be without prejudice to the Bank’s rights hereunder and will be
deemed to have been conditioned upon such payment having become final and
irrevocable.


 


4.             Financial Statements.  Unless compliance is waived in writing by the
Bank or until all of the Obligations have been paid in full, each Guarantor
will promptly submit to the Bank such information relating to such Guarantor’s
affairs (including but not limited to annual financial statements and tax
returns for the Guarantor) or any security for the Guaranty as the Bank may
reasonably request.


 


5.             Enforceability of Obligations.  No
modification, limitation or discharge of the Obligations arising out of or by
virtue of any bankruptcy, reorganization or similar proceeding 


 


2

















 


for
relief of debtors under federal or state law will affect, modify, limit or
discharge the Guarantors’ liability in any manner whatsoever and this Guaranty
will remain and continue in full force and effect and will be enforceable
against the Guarantors to the same extent and with the same force and effect as
if any such proceeding had not been instituted. 
Each Guarantor waives all rights and benefits which might accrue to it
by reason of any such proceeding and will be liable to the full extent
hereunder, irrespective of any modification, limitation or discharge of the
liability of the Borrower that may result from any such proceeding.


 


6.             Events of Default.  The
occurrence of any of the following shall be an “Event of Default”:  (i) any
Event of Default (as defined in any of the Obligations); (ii) demand by
the Bank under any of the Obligations that have a demand feature; (iii) the
Guarantors’ failure to perform any of their obligations hereunder; (iv) the
falsity, inaccuracy or material breach by a Guarantor of any written warranty,
representation or statement made or furnished to the Bank by or on behalf of
such Guarantor; or (v) the termination or attempted termination of this
Guaranty.  Upon the occurrence of any
Event of Default, (a) the Guarantors shall pay to the Bank the amount of
the Obligations; or (b) on demand of the Bank, the Guarantors shall
immediately deposit with the Bank, in U.S. dollars, all amounts due or to
become due under the Obligations, and the Bank may at any time use such funds
to repay the Obligations; or (c) the Bank in its discretion may exercise
with respect to any collateral any one or more of the rights and remedies provided
a secured party under the applicable version of the Uniform Commercial Code; or
(d) the Bank in its discretion may exercise from time to time any other
rights and remedies available to it at law, in equity or otherwise.


 


7.             Right of Setoff.  In addition to all liens upon and rights of
setoff against the Guarantors’ money, securities or other property given to the
Bank by law, the Bank shall have, with respect to the Guarantors’ obligations
to the Bank under this Guaranty and to the extent permitted by law, a
contractual possessory security interest in and a contractual right of setoff
against, and each Guarantor hereby grants Bank a security interest in, and
hereby assigns, conveys, delivers, pledges and transfers to the Bank all of
such Guarantor’s right, title and interest in and to, all of such Guarantor’s
deposits, moneys, securities and other property now or hereafter in the
possession of or on deposit with, or in transit to, the Bank or any other
direct or indirect subsidiary of The PNC Financial Services Group, Inc.,
whether held in a general or special account or deposit, whether held jointly
with someone else, or whether held for safekeeping or otherwise, excluding,
however, all IRA, Keogh, and trust accounts. 
Every such security interest and right of setoff may be exercised
without demand upon or notice to such Guarantor.  Every such right of setoff shall be deemed to
have been exercised immediately upon the occurrence of an Event of Default
hereunder without any action of the Bank, although the Bank may enter such
setoff on its books and records at a later time.


 


8.             Collateral.  This Guaranty is secured by the property
described in any collateral security documents which each Guarantor executes
and delivers to the Bank and by such other collateral as previously may have
been or may in the future be granted to the Bank to secure any Obligations of
the Guarantors to the Bank.


 


9.             Costs.  To
the extent that the Bank incurs any reasonable out-of-pocket costs or expenses
in protecting or enforcing its rights under the Obligations or this Guaranty,
including attorneys’ fees and the costs and expenses of litigation, such costs
and expenses will be due on 


 


3

















 


demand,
will be included in the Obligations and will bear interest from the incurring
or payment thereof at the Default Rate (as defined in any of the Obligations).


 


10.           Postponement of Subrogation.  Until the Obligations are indefeasibly paid
in full, expire, are terminated and are not subject to any right of revocation
or rescission, the Guarantor postpones and subordinates in favor of the Bank or
its designee (and any assignee or potential assignee) any and all rights which
the Guarantors may have to (a) assert any claim whatsoever against the
Borrower based on subrogation, exoneration, reimbursement, or indemnity or any
right of recourse to security for the Obligations with respect to payments made
hereunder, and (b) any realization on any property of the Borrower,
including participation in any marshalling of the Borrower’s assets.


 


11.           Notices.  All
notices, demands, requests, consents, approvals and other communications
required or permitted hereunder (“Notices”)
must be in writing and will be effective upon receipt.  Notices may be given in any manner to which
the Bank and the Guarantors may separately agree, including electronic
mail.  Without limiting the foregoing,
first-class mail, facsimile transmission and commercial courier service are
hereby agreed to as acceptable methods for giving Notices.  Regardless of the manner in which provided,
Notices may be sent to addresses for the Bank and the Guarantors as set forth
above or to such other address as either may give to the other for such purpose
in accordance with this section.


 


12.           Preservation of Rights.  No
delay or omission on the Bank’s part to exercise any right or power arising
hereunder will impair any such right or power or be considered a waiver of any
such right or power, nor will the Bank’s action or inaction impair any such
right or power.  The Bank’s rights and
remedies hereunder are cumulative and not exclusive of any other rights or
remedies which the Bank may have under other agreements, at law or in
equity.  The Bank may proceed in any
order against the Borrower, the Guarantors or any other obligor of, or
collateral securing, the Obligations.


 


13.           Illegality.  If any provision contained in this Guaranty
should be invalid, illegal or unenforceable in any respect, it shall not affect
or impair the validity, legality and enforceability of the remaining provisions
of this Guaranty.


 


14.           Changes in Writing.  No modification, amendment or waiver of, or
consent to any departure by the Guarantors from, any provision of this Guaranty
will be effective unless made in a writing signed by the Bank, and then such
waiver or consent shall be effective only in the specific instance and for the
purpose for which given.  No notice to or
demand on the Guarantors will entitle the Guarantors to any other or further
notice or demand in the same, similar or other circumstance.


 


15.           Entire Agreement.  This Guaranty (including the documents and
instruments referred to herein) constitutes the entire agreement and supersedes
all other prior agreements and understandings, both written and oral, between
the Guarantors and the Bank with respect to the subject matter hereof;
provided, however, that this Guaranty is in addition to, and not in
substitution for, any other guarantees from the Guarantors to the Bank.


 


4

















 


16.           Successors and Assigns.  This Guaranty will be binding upon and inure
to the benefit of the Guarantors and the Bank and their respective heirs,
executors, administrators, successors and assigns; provided, however,
that the Guarantors may not assign this Guaranty in whole or in part without
the Bank’s prior written consent and the Bank at any time may assign this
Guaranty in whole or in part.


 


17.           Interpretation.  In this Guaranty, unless the Bank and the
Guarantors otherwise agree in writing, the singular includes the plural and the
plural the singular; references to statutes are to be construed as including
all statutory provisions consolidating, amending or replacing the statute
referred to; the word “or” shall be deemed to include “and/or”, the words “including”,
“includes” and “include” shall be deemed to be followed by the words “without
limitation”; and references to sections or exhibits are to those of this
Guaranty.  Section headings in this
Guaranty are included for convenience of reference only and shall not
constitute a part of this Guaranty for any other purpose.  If this Guaranty is executed by more than one
party as Guarantor, the obligations of such persons or entities will be joint
and several.


 


18.           Indemnity.  Each Guarantor agrees to indemnify each of
the Bank, each legal entity, if any, who controls the Bank and each of their
respective directors, officers and employees (the “Indemnified Parties”), and to hold each Indemnified Party
harmless from and against, any and all claims, damages, losses, liabilities and
expenses (including all fees and charges of internal or external counsel with
whom any Indemnified Party may consult and all expenses of litigation and
preparation therefor) which any Indemnified Party may incur or which may be
asserted against any Indemnified Party by any person, entity or governmental
authority (including any person or entity claiming derivatively on behalf of
such Guarantor), in connection with or arising out of or relating to the
matters referred to in this Guaranty, whether (a) arising from or incurred
in connection with any breach of a representation, warranty or covenant by such
Guarantor, or (b) arising out of or resulting from any suit, action,
claim, proceeding or governmental investigation, pending or threatened, whether
based on statute, regulation or order, or tort, or contract or otherwise,
before any court or governmental authority; provided, however,
that the foregoing indemnity agreement shall not apply to any claims, damages,
losses, liabilities and expenses to the extent attributable to an Indemnified
Party’s gross negligence or willful misconduct. 
The indemnity agreement contained in this Section shall survive the
termination of this Guaranty and assignment of any rights hereunder.  Each Guarantor may participate at its expense
in the defense of any such claim.


 


19.           Governing Law and Jurisdiction.  This Guaranty has been delivered to and
accepted by the Bank and will be deemed to be made in the Commonwealth of
Pennsylvania (the “Commonwealth”).  THIS GUARANTY WILL BE INTERPRETED AND THE RIGHTS AND
LIABILITIES OF THE BANK AND THE GUARANTOR DETERMINED IN ACCORDANCE WITH THE
LAWS OF THE COMMONWEALTH, EXCLUDING ITS CONFLICT OF LAWS RULES.  The Guarantor hereby irrevocably consents to
the exclusive jurisdiction of any state or federal court in the Commonwealth;
provided that nothing contained in this Guaranty will prevent the Bank from
bringing any action, enforcing any award or judgment or exercising any rights
against the Guarantors individually, against any security or against any
property of the Guarantors within any other county, state or other foreign or
domestic jurisdiction.  Each Guarantor
acknowledges and agrees that the venue provided above is the most convenient
forum for both the Bank and 


 


5

















 


such
Guarantor.  Each Guarantor waives any
objection to venue and any objection based on a more convenient forum in any
action instituted under this Guaranty.


 


20.           Equal Credit Opportunity Act.  If the Guarantors are not “applicants for
credit” under Section 202.2 (e) of the Equal Credit Opportunity Act
of 1974 (“ECOA”), each Guarantor acknowledges that (i) this Guaranty has
been executed to provide credit support for the Obligations, and (ii) such
Guarantor was not required to execute this Guaranty in violation of Section 202.7(d) of
the ECOA.


 


21.          WAIVER OF JURY TRIAL. 
EACH GUARANTOR IRREVOCABLY WAIVES ANY AND ALL RIGHT SUCH GUARANTOR MAY HAVE
TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM OF ANY NATURE RELATING TO
THIS GUARANTY, ANY DOCUMENTS EXECUTED IN CONNECTION WITH THIS GUARANTY OR ANY
TRANSACTION CONTEMPLATED IN ANY OF SUCH DOCUMENTS.  EACH GUARANTOR ACKNOWLEDGES THAT THE
FOREGOING WAIVER IS KNOWING AND VOLUNTARY.


 


Each Guarantor acknowledges
that it has read and understood all the provisions of this Guaranty, including
the waiver of jury trial, and has been advised by counsel as necessary or
appropriate.


 


6

















 


WITNESS the due
execution hereof as a document under seal, as of the date first written above,
with the intent to be legally bound hereby.


 


	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
  New Horizons Education Corporation

  
	
   

  	
  New Horizons Computer Learning Center of Albuquerque, Inc.

  
	
   

  	
  NHCLC of San Antonio, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Hartford, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Denver, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Charlotte, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Sacramento, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Cleveland, Ltd, LLC

  
	
   

  	
  New Horizons Computer Learning Center of Indianapolis, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Indianapolis, LLC

  
	
   

  	
  New Horizons Computer Learning Center of Memphis, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Santa Ana, Inc.

  
	
   

  	
  New Horizons Computer Learning Centers, Inc.

  
	
   

  	
  Computer Training Associates of Chicago, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Nashville, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Metropolitan New
  York, Inc.

  
	
   

  	
  New Horizons Computer Learning Center of Atlanta, Inc.

  
	
   

  	
  New Horizons Franchising Group, Inc.

  
	
   

  	
  New Horizons Computer Learning Centers EMEA, LLC

  
	
   

  	
  New Horizons Computer Learning Centers APAC, LLC

  
	
   

  	
  Nova Vista, LLC

  
	
   

  	
  NH Mexico, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title: