<PAGE>   1
                                                                  EXHIBIT 10.46



                             BUSINESS LOAN AGREEMENT

                                     BETWEEN

                        BANK OF AMERICA, FSB (THE "BANK")

                                       AND

                        EDUCATIONAL MEDICAL, INC. ("EMI")
                    AND ALL SUBSIDIARIES OF EMI ("BORROWERS")

                            DATED: FEBRUARY 25, 1997




<PAGE>   2




                                TABLE OF CONTENTS

<TABLE>
<S><C>                                                                       <C>
1. DEFINITIONS ..........................................................     1
       1.1  "Borrowing Base" ............................................     1
       1.2  "Acceptable Receivable" .....................................     1
       1.3  "Termination Date" ..........................................     3

2. FACILITY NO. 1: REVOLVING LINE OF CREDIT AMOUNT AND TERMS.............     3
       2.1  Revolving Line of Credit Amount .............................     3
       2.2  Availability Period .........................................     4
       2.3  Conditions to Each Extension of Credit ......................     4
       2.4  Repayment Terms .............................................     4
       2.5  Letters of Credit ...........................................     6

3. FACILITY NO. 2: ACQUISITION Line OF CREDIT AMOUNT AND TERMS...........     7
       3.1  Acquisition Line of Credit Amount ...........................     7
       3.2  Availability Period .........................................     7
       3.3  Conditions to Each Extension of Credit ......................     7
       3.4  Repayment Terms .............................................     8

4. INTEREST .............................................................    10
       4.1  Interest Rate ...............................................    10
       4.2  Optional Interest Rate ......................................    10

5. COLLATERAL ...........................................................    12
       5.1  Personal Property ...........................................    12

6. DISBURSEMENTS, PAYMENTS AND COSTS ....................................    13
       6.1  Requests for Credit .........................................    13
       6.2  Disbursements and Payments ..................................    13
       6.3  Direct Debit ................................................    13
       6.4  Banking Days ................................................    13
       6.5  Taxes .......................................................    14
       6.6  Additional Costs ............................................    14
       6.7  Interest Calculation ........................................    14
       6.8  Default Rate ................................................    14
       6.9  Overdrafts ..................................................    15
</TABLE>



                                       i

<PAGE>   3



<TABLE>
<S><C>                                                                       <C>
       6.10 Payments in Kind ............................................    15

7. CONDITIONS ...........................................................    15
       7.1  Authorizations ..............................................    15
       7.2  Governing Documents .........................................    15
       7.3  Security Agreements .........................................    16
       7.4  Evidence of Priority ........................................    16
       7.5  Insurance ...................................................    16
       7.6  Legal Opinion ...............................................    16
       7.7  Good Standing ...............................................    16
       7.8  Payment of Closing Fee ......................................    16
       7.9  Payment of Expenses and Fees ................................    16
       7.10 Representations of Corporate Officers .......................    16
       7.11 Other Items .................................................    16

8. REPRESENTATIONS AND WARRANTIES .......................................    16
       8.1  Organization of Borrower ....................................    16
       8.2  Authorization ...............................................    17
       8.3  Enforceable Agreement .......................................    17
       8.4  Good Standing ...............................................    17
       8.5  No Conflicts ................................................    17
       8.6  Financial Information .......................................    17
       8.7  Lawsuits ....................................................    17
       8.8  Collateral ..................................................    17
       8.9  Permits, Franchises .........................................    18
       8.10 Other Obligations ...........................................    18
       8.11 Income Tax Returns ..........................................    18
       8.12 No Tax Avoidance Plan .......................................    18
       8.13 No Event of Default .........................................    18
       8.14 ERISA Plans .................................................    18
       8.15 Locations of Borrowers ......................................    19
       8.16 Subsidiaries ................................................    19

9. COVENANTS ............................................................    19
       9.1  Use of Proceeds .............................................    19
       9.2  Financial Information .......................................    19
       9.3  Net Worth ...................................................    21
       9.4  Tangible Net Worth ..........................................    22
       9.5  Fixed Charge Coverage Ratio .................................    22
       9.6  Total Funded Debt/Adjusted Cash Flow Coverage Ratio .........    22
</TABLE>


                                       ii

<PAGE>   4



<TABLE>
<S> <C>                                                                      <C>
       9.7  Senior Funded Debt/Adjusted Cash Flow Ratio .................    23
       9.8  Other Debts .................................................    23
       9.9  Other Liens .................................................    23
       9.10 Capital Expenditures ........................................    24
       9.11 Dividends ...................................................    24
       9.12 Loans and Investments .......................................    24
       9.13 Change of Ownership .........................................    25
       9.14 Notices to Bank .............................................    25
       9.15 Books and Records ...........................................    26
       9.16 Audits ......................................................    26
       9.17 Compliance with Laws ........................................    26
       9.18 Preservation of Rights ......................................    26
       9.19 Maintenance of Properties ...................................    26
       9.20 Perfection of Liens .........................................    26
       9.21 Cooperation .................................................    26
       9.22 Insurance ...................................................    26
       9.23 Additional Negative Covenants ...............................    27
       9.24 ERISA Plans .................................................    29
       9.25 Title IV Program Requirements ...............................    29
       9.26 Subsidiaries ................................................    30

10. HAZARDOUS WASTE INDEMNIFICATION .....................................    30

11. DEFAULT .............................................................    30
      11.1  Failure to Pay ..............................................    30
      11.2  Lien Priority ...............................................    31
      11.3  False Information ...........................................    31
      11.4  Bankruptcy ..................................................    31
      11.5  Receivers ...................................................    31
      11.6  Lawsuits ....................................................    31
      11.7  Judgments ...................................................    31
      11.8  Government Action ...........................................    31
      11.9  Material Adverse Change .....................................    31
      11.10 Cross-default ...............................................    31
      11.11 Default under Related Documents .............................    32
      11.12 Other Bank Agreements .......................................    32
      11.13 ERISA Plans .................................................    32
      11.14 Other Breach Under Agreement ................................    32

12. ENFORCING THIS AGREEMENT; MISCELLANEOUS .............................    33
</TABLE>



                                      iii


<PAGE>   5


<TABLE>
      <S>                                                                    <C>
      12.1  GAAP ........................................................    33
      12.2  Georgia Law .................................................    33
      12.3  Successors and Assigns ......................................    33
      12.4  Arbitration .................................................    33
      12.5  Severability; Waivers .......................................    34
      12.6  Reimbursement Costs .........................................    34
      12.7  Administration Costs ........................................    34
      12.8  Attorneys' Fees .............................................    34
      12.9  Joint and Several Liability .................................    35
      12.10 One Agreement ...............................................    36
      12.11 Disposition of Schedules ....................................    36
      12.12 Credit Adjustments ..........................................    36
      12.13 Verification of Receivables .................................    37
      12.14 Indemnification .............................................    37
      12.15 Notices .....................................................    37
      12.16 Headings ....................................................    37
      12.17 Counterparts ................................................    37
</TABLE>



















                                       iv



<PAGE>   6



                          List of Certain Defined Terms
                          -----------------------------
<TABLE>
<CAPTION>

  Defined Term                               Location in Text
  ------------                               ----------------

  <S>                                        <C>
  Acceptable Receivable                      Para. 1.2

  BofA                                       Para. 4.1(b)

  banking day                                Para. 7.5

  Borrower, Borrowers                        Page 1, First Paragraph

  Borrowing Base                             Para. 1.1

  Closing Date                               Page 1, First Paragraph

  Default                                    Para. 12

  EBITDA                                     Para. 3.3

  EMI                                        Page 1, First Paragraph

  ERISA                                      Para. 8.14(e)

  event of default                           Para. 12

  Facilities or Facility                     Para. 4.1

  Facility No. 1                             Para. 2.1

  Facility No. 1 Commitment                  Para. 2.1

  Facility No. 2                             Para. 3.1

  Facility No. 2 Commitment                  Para. 3.1

  GAAP                                       Para. 12.1

  issuer                                     Para. 2.5
</TABLE>



                                       v



<PAGE>   7



<TABLE>
<CAPTION>
  <S>                                        <C>   
  LIBOR Banking Day                          Para. 4.2(a)

  LIBOR Rate                                 Para. 4.2(c)

  LIBOR Rate Portion                         Para. 4.2

  PBGC                                       Para. 8.14(e)

  Plan                                       Para. 8.14(e)

  Reference Rate                             Para. 4.1

  schools                                    Para. 9.25(e)

  Termination Date                           Para. 1.3

  Test Ratio                                 Para. 2.4(a)

  Title IV Program Requirements              Para. 9.27
</TABLE>








                                       vi

<PAGE>   8



                             BUSINESS LOAN AGREEMENT

         This Agreement, dated as of February 25, 1997, is made among BANK OF
AMERICA, FSB (the "Bank"), EDUCATIONAL MEDICAL, INC. ("EMI") and all those
subsidiaries of EMI listed on the signature page(s) to this Agreement (EMI and
such subsidiaries hereinafter sometimes collectively called the "Borrowers" and
individually called a "Borrower").

         PREAMBLE. EMI and its subsidiaries are engaged in a common business
enterprise and, in connection therewith, have determined it to be in their
mutual economic interests to apply to the Bank on a collective basis for
extensions of credit for working capital and to finance continued expansion,
with EMI acting as agent for all Borrowers in connection with any requests for,
the receipt, disbursement, allocation and administration of, and the repayment
of, the extensions of credit to be made hereunder. Accordingly, the Borrowers
hereby covenant to and agree with the Bank as follows:

1.       DEFINITIONS

In addition to the terms which are defined elsewhere in this Agreement, the
following terms have the meanings indicated for the purposes of this Agreement:

         1.1      "Borrowing Base" means 80% of the balance due on Acceptable
Receivables of the Borrowers.

         1.2      "Acceptable Receivable" means an account receivable of a
Borrower which satisfies the following requirements:

                  (a)      The account has resulted from the sale of goods or
the performance of services by the Borrower in the ordinary course of the
Borrower's business.

                  (b)      There are no conditions which must be satisfied
before the Borrower is entitled to receive payment of the account. Accounts
arising from COD sales, consignments or guaranteed sales are not acceptable.

                  (c)      The debtor upon the account does not claim any
defense to payment of the account.

                  (d)      The account balance does not include the amount of
any counterclaims or offsets which have been or may be asserted against the
Borrower by the account debtor (including offsets for any "contra accounts" owed
by the Borrower to the account debtor for goods purchased by the Borrower or for
services performed for the



<PAGE>   9



Borrower). To the extent any counterclaims, offsets, contra accounts, or credit
balances exist in favor of the debtor, such amounts shall be deducted from the
account balance.

                  (e)      The account represents a genuine obligation of the
debtor for goods sold and accepted by the debtor, or for services performed for
and accepted by the debtor.

                  (f)      The Borrower has sent an invoice to the debtor in the
amount of the account.

                  (g)      The Borrower is not prohibited by the laws of the
state where the account debtor is located from bringing an action in the courts
of that state to enforce the debtor's obligation to pay the account. The
Borrower has taken all appropriate actions to ensure access to the courts of the
state where the account debtor is located, including, where necessary, the
filing of a notice of business activities report or other similar filing with
the applicable state agency or the qualification by the Borrower as a foreign
corporation authorized to transact business in such state. 

                  (h)      The account is owned by the Borrower free of any
title defects or any liens or interests of others except the security interest
in favor of the Bank, and except as permitted under Paragraph 9.9.

                  (i)      The debtor upon the account is not any of the
following:

                  (1)      an employee, affiliate, parent or subsidiary of the
         Borrower, or an entity which has common officers or directors with the
         Borrower;

                  (2)      any state, county, city, town or municipality;

                  (3)      any person or entity located in a foreign country.

                  (j)      The account is not in default. An account will be
considered in default if any of the following occur:

                  (1)      The account is not paid within the 180 day period
         starting on its billing date; or

                  (2)      Any petition is filed by or against the debtor
         obligated upon the account under any bankruptcy law or any other law or
         laws for the relief of debtors.




                                      -2-
<PAGE>   10



                  (k)      The account is not the obligation of a debtor who is
in default (as defined above) on 50% or more of the accounts (if more than one)
with the Borrower upon which such debtor is obligated.

                  (l)      The account is not evidenced by a promissory note or
chattel paper.

                  (m)      The account is otherwise acceptable to the Bank.

         1.3      "Termination Date" shall mean the third (3rd) anniversary of
the date of this Agreement; provided, however, that the Bank, in its sole
discretion, upon the Borrowers' request, may elect, by giving written notice to
the Borrowers to such effect, beginning in the second year of this Agreement,
but not later than 120 days before any then effective Termination Date, to
extend such "Termination Date" for up to two (2) additional periods of up to one
(1) year each on such terms and conditions (which may differ from those set
forth herein) as the Bank may offer, and the Borrowers may accept.


2.       FACILITY NO. 1: REVOLVING LINE OF CREDIT AMOUNT AND TERMS

         2.1      Revolving Line of Credit Amount.

                  (a)      During the availability period described below, the
Bank will provide a revolving line of credit ("Facility No. 1") to the
Borrowers. The amount of this revolving line of credit (the "Facility No. 1
Commitment") is equal to the lesser of (i) $5,000,000 or (ii) the Borrowing
Base.

                  (b)      Facility No. 1 is a revolving line of credit for
advances with a within line facility for letters of credit. During the
availability period, the Borrowers may repay principal amounts and reborrow
them.

                  (c)      Each advance under Facility No. 1 must be for at
least $250,000 or for the amount of the remaining available line of credit, if
less.

                  (d)      The Borrowers agree not to permit the sum of
outstanding principal amount of advances obtained under Facility No. 1 plus the
outstanding amounts of any letters of credit under Paragraph 2.5, including
amounts drawn on letters of credit and not yet reimbursed, to exceed the
Facility No. 1 Commitment. If the Borrowers exceed this limit, the Borrowers
will immediately pay the excess to the Bank upon the Bank's demand. Unless and
until an Event of Default has occurred and is continuing, the Borrowers shall
have the right to direct the manner or order in which payments received from the
Borrowers





                                      -3-
<PAGE>   11




under this Paragraph shall be applied to this Facility. From and after the
occurrence of an Event of Default and during its continuance, the Bank may apply
payments received from the Borrowers under this Paragraph to the obligations of
the Borrowers to the Bank in the order and the manner as the Bank, in its
discretion, may determine, including to this Facility or the other Facility.

         2.2      Availability Period. Facility No. 1 is available between the
date of this Agreement and the Termination Date, unless the Borrowers are in
default.

         2.3      Conditions to Each Extension of Credit. Before each extension
of credit under Facility No. 1, including the first, the Borrowers will deliver
to the Bank (i) a notice of borrowing, in form and detail satisfactory to the
Bank, issued by EMI as agent for and on behalf of the Borrowers, specifying the
amount of the requested advance, the intended use of the proceeds thereof, the
requested disbursement date and the desired interest rate to be applicable,
initially, thereto; and (ii) a borrowing base certificate, in form and detail
satisfactory to the Bank, issued by EMI as agent for and on behalf of the
Borrowers, setting forth the Acceptable Receivables on which the requested
extension of credit is to be based.

         2.4      Repayment Terms

                  (a)      The Borrowers will pay interest, in arrears, at the
then applicable interest rate described below on outstanding advances under
Facility No. 1 on the first day of the calendar month following the disbursement
of any advance under Facility No. 1 and then on a monthly basis thereafter until
payment in full of such advance. The interest rate payable on outstanding
advances under Facility No. 1 shall be determined as follows:

<TABLE>
<CAPTION>
                                        Interest                 Interest
                                        Rate shall               Rate shall be
  If the Test                           be Reference    -or-     LIBOR Rate
  Ratio is:                             Rate plus                plus
  ---------                             ---------                ----

  <S>                                      <C>                   <C>  
  1.5:1 or greater                         .50%                  1.75%
  1.0:1 or greater, but less than 1.5:1    .25%                  1.50%
  less than 1.0:1                            0%                  1.25%
</TABLE>


As used herein, (i) "Reference Rate" is defined in Paragraph 4.1, (ii) "LIBOR
Rate" is defined in Paragraph 4.2, and (iii) the "Test Ratio" shall be the
Senior Funded Debt/Adjusted Cash Flow Ratio, as defined in Paragraph 9.7. The
Test Ratio shall be calculated on a quarterly basis by the Bank from the
Borrowers' quarterly or, as the case may be, annual financial statements then
most recently delivered to it pursuant to Paragraphs 9.2(a) and






                                      -4-
<PAGE>   12



9.2(b), and the interest rate(s) described above shall be adjusted by the Bank,
as appropriate, effective as of the first day of the month following the month
in which such financial statements are delivered to the Bank, (i) as to all
advances then outstanding and any made on or after such date, for all advances
which bear interest determined by reference to the Reference Rate and (ii) as to
all advances made on or after such date (including any "rollover" of existing
LIBOR Rate portions during such period), for LIBOR Rate portions; in each case,
until the next such determination by the Bank becomes effective. If, however,
the Borrowers fail to timely deliver their quarterly or, as the case may be,
annual financial statements to the Bank pursuant to Paragraphs 9.2(a) or 9.2(b)
for any fiscal quarter, the Bank shall use an assumed Test Ratio of 1.5:1 to
make its calculations.

                  (b)      The Borrowers agree to pay the Bank an annual,
nonrefundable facility fee for Facility No. 1, equal to .375% of the full amount
of the Facility No. 1 Commitment, or $18,750, payable annually in advance,
commencing on the date of this Agreement and continuing on each anniversary of
such date (less $15,000 in respect of the first such payment, representing a
partial prepayment).

                  (c)      The Borrowers further agree to pay the Bank a
commitment fee, determined by multiplying (i) the difference between (A) the
full amount of the Bank's Facility No. 1 Commitment and (B) the amount of credit
which the Borrowers actually use of Facility No. 1, based on the weighted
average credit outstanding under Facility No. 1 during the specified period, by
(ii) the per annum commitment fee described below, computed as follows:


<TABLE>
<CAPTION>
                                                  The Per Annum
  If the Test                                     Commitment
  Ratio is                                        Fee shall be
  --------                                        ------------

  <S>                                               <C>  
  1.5:1 or greater                                  .375%
  less than 1.5:1                                   .250%
</TABLE>


with the Test Ratio being computed by the Bank in the same manner, and to take
effect at the same time, as is provided in subparagraph (a) above. The
calculation of credit outstanding under Facility No. 1 shall include the undrawn
amount of letters of credit. This commitment fee shall be due and payable
monthly in arrears on the first day of each calendar month until the expiration
of the availability period for Facility No. 1, commencing on the first day of
the first calendar month following the date of this Agreement.


                                      -5-

<PAGE>   13




                  (d)      The Borrowers will repay in full all principal and
any unpaid interest or other charges outstanding under Facility No. 1 no later
than the Termination Date.

         2.5      Letters of Credit. Facility No. l may also be used for
financing standby letters of credit with a maximum maturity not to extend for
more than one (1) year or, in any event, beyond the Termination Date. The
standby letters of credit will be issued by Bank of America National Trust and
Savings Association or its designated affiliate bank (herein, an "issuer")
subject to a reimbursement obligation on the part of the Bank (which, in turn,
will be reimbursed by the Borrowers). The amount of such letters of credit
outstanding at any one time (including amounts drawn on letters of credit and
not yet reimbursed) may not exceed $1,000,000. In further regard to these
standby letters of credit, the Borrowers agree:

                  (a)      any sum drawn under a letter of credit and reimbursed
by the Bank may, at the option of the Bank, be added to the principal amount
outstanding under this Agreement. This amount will bear interest and be due as
described elsewhere in this Agreement.

                  (b)      if there is a default under this Agreement, to
immediately prepay and make the Bank whole for its liability to the issuer for
any outstanding letters of credit.

                  (c)      the issuance of any letter of credit and any
amendment to a letter of credit is subject to the Bank's and the issuer's
written approval and must be in form and content satisfactory to the Bank and
the issuer and in favor of a beneficiary acceptable to the Bank and the issuer.

                  (d)      at the Bank's or the issuer's request, to sign the
issuer's form application and agreement for standby letters of credit.

                  (e)      to pay any issuance and/or other fees that the Bank
or the issuer notifies the Borrower will be charged for issuing and processing
letters of credit for the Borrower.

                  (f)      to pay the Bank a non-refundable fee equal to 1-1/2%
per annum of the average daily balance of the outstanding undrawn amount of each
standby letter of credit, payable monthly in arrears. If there is a default
under this Agreement, at the Bank's option, the amount of the fee shall be
increased by 2% per annum, effective starting on the day the Bank provides
notice of the increase to the Borrowers.







                                      -6-
<PAGE>   14



3.       FACILITY NO. 2: ACQUISITION LINE OF CREDIT AMOUNT AND TERMS

         3.1      Acquisition Line of Credit Amount

                  (a)      During the availability period described below, the
Bank will provide a line of credit to the Borrowers for the purpose of
financing, in whole or in part, permitted acquisitions under Paragraph 9.23(e)
("Facility No. 2"). The amount of this acquisition line of credit (the "Facility
No. 2 Commitment") is equal to: (i) $5,000,000, for the first year in which
Facility No. 2 shall be available; (ii) $7,500,000, for the second year in which
Facility No. 2 shall be available; and (iii) $12,500,000, thereafter, subject,
however, to reduction in each year as provided in subparagraph (b).

                  (b)      Facility No. 2 is not a revolving line of credit.
That is, each advance obtained under Facility No. 2 shall reduce,
dollar-for-dollar, the Facility No. 2 Commitment, regardless if and when such
advance is made or repaid; that is, an advance made in the first year shall
reduce the Facility No. 2 commitment dollar-for-dollar in such year and in all
subsequent years.

                  (c)      Each advance under Facility No. 2 must be for at
least $500,000, or for the amount of the remaining available Facility No. 2
Commitment, if less.

                  (d)      The Borrowers agree not to permit the outstanding
principal amount of advances obtained under Facility No. 2 to exceed the
Facility No. 2 Commitment. If the Borrowers exceed this limit, the Borrowers
will immediately pay the excess to the Bank upon the Bank's demand. Unless and
until an Event of Default has occurred and is continuing, the Borrowers shall
have the right to direct the manner or order in which payments received from the
Borrowers under this Paragraph shall be applied to this Facility. From and after
the occurrence of an Event of Default and during its continuance, the Bank may
apply any payments received from the Borrowers under this Paragraph to the
obligations of the Borrowers to the Bank in the order and manner as the Bank, in
its discretion, may determine, including to this Facility or another Facility.

         3.2      Availability Period. Facility No. 2 is available between the
date of this Agreement and the Termination Date, unless the Borrowers are in
default.

         3.3      Conditions to Each Extension of Credit. Before each extension
of credit under Facility No. 2, including the first, the Bank shall receive a
notice of borrowing, in form and detail satisfactory to the Bank, issued by EMI
as agent for and on behalf of the Borrowers, specifying the amount of the
requested advance, the intended use of the proceeds






                                      -7-
<PAGE>   15



thereof, the requested disbursement date and the desired interest rate to be
applicable, initially, thereto, together with evidence satisfactory to the Bank
from the Borrowers that:

                  (i)      the acquisition proposed to be financed is then
permitted under Paragraph 9.23(e).

                  (ii)     all proceeds of EMI's initial public offering (net of
not more than $5,000,000 in existing debt repaid with such proceeds), equalling
at least $14,500,000, have been used to finance other acquisitions or will be
used, in part, to fund the proposed acquisition.

                  (iii)    the "EBITDA" of EMI, computed as described below, on
a consolidated basis, for the trailing 12 months' period ending with the last
day of the calendar month immediately preceding the date of any requested
advance, computed on a pro forma basis inclusive of the school(s) proposed to be
acquired with the proceeds of such advance (as adjusted by the Bank, in its sole
discretion for any non-recurring charges or expenses), shall be not less than
the sum of (A) $5,500,000, plus (B) 20% of the sum of (i) the cost of all
acquisitions made by EMI since June 30, 1996, plus (ii) the cost of the
acquisition proposed to be made. For purposes hereof, "EBITDA" shall mean the
net income after taxes of EMI and its consolidated subsidiaries for the fiscal
period in question on a pro forma basis inclusive of the school(s) proposed to
be acquired, after adjustment by the Bank to reflect, in the case of such
school(s), the following, as applicable: plus any non-recurring charges or
expenses; less any items of extraordinary income or gain; plus interest
expense; plus tax expense; plus depreciation and amortization expense, each for
the same said entities and period.

         3.4      Repayment Terms

                  (a)      The Borrowers will pay interest, in arrears, at the
then applicable interest rate described below, on outstanding advances under
Facility No. 2 on the first day of the calendar month following the disbursement
of any advance under Facility No. 2 and then on a monthly basis thereafter until
such advance is paid in full. The interest rate payable on outstanding advances
under Facility No. 2 shall be determined as follows:




                                      -8-
<PAGE>   16


<TABLE>
<CAPTION>
                                                    Interest            Interest
                                                    Rate shall          Rate shall
  If the Test                                       be Reference  -or-  be LIBOR
  Ratio is :                                        Rate plus           Rate plus
  ----------                                        ---------           ---------

  <S>                                               <C>                  <C>  
  1.5:1 or greater                                  .50%                 2.00%
  1.0:1 or greater but less than 1.5:1              .25%                 1.75%
  less than 1.0:1                                     0%                 1.50%
</TABLE>

with the Test Ratio, and resulting interest rate, being computed by the Bank in
the same manner as is provided in Paragraph 2.4(a).

                  (b)      The Borrowers agree to pay the Bank an annual,
nonrefundable facility fee for Facility No. 2, determined as follows: (A) in the
first year, .375% of the initial Facility No. 2 Commitment, or $18,750, payable
at the time that the first advance is made under Facility No. 2 (and if no such
advance is made in the first year of this Agreement, this payment shall be
waived for the first year); (B) in the second year, .375% of the then full
amount of the Facility No. 2 Commitment, or $28,125, if no fee was paid in the
first year, but otherwise on the incremental increase of $2,500,000 in the
Facility No. 2 Commitment, or $9,375, payable on the first anniversary of the
date of this Agreement, and (C) in the third year, .375% of the incremental
increase of $5,000,000 in the Facility No. 2 Commitment, or $18,750, payable on
the second anniversary of the date of this Agreement.

                  (c)      The Borrowers further agree to pay the Bank a
commitment fee determined by multiplying (i) the difference between (A) the then
full amount of the Bank's Facility No. 2 Commitment and (B) the amount of credit
which the Borrowers actually use of the Facility, based on the weighted average
credit outstanding under Facility No. 2 during the specified period, by (ii) the
per annum commitment fee described below, computed as follows:

<TABLE>
<CAPTION>
                                                                 Per Annum
  If the Test                                                    Commitment
  Ratio is                                                       Fee shall be
  --------                                                       ------------

  <S>                                                            <C>  
  1.5:1 or greater                                               .500%
  1.0:1 or greater, but less than 1.5:1                          .375%
  less than 1.0:1                                                .250%
</TABLE>

The fee shall be due and payable monthly in arrears on the first day of each
calendar month until the expiration of the availability period for Facility No.
2, commencing on the first day




                                      -9-
<PAGE>   17



of the first calendar month following the date of this Agreement; provided,
however, for Facility No. 2 only, that the payment of this fee in the first year
of the Agreement shall be deferred until the first advance is obtained under
Facility No. 2 (but the fee will be due for the entire one year period to date
at such time based on the average unused amount) and shall be waived for the
first year if no advance under Facility No. 2 is obtained within such period.

                  (d)      The Borrowers will repay in full all principal or
other charges outstanding under this Facility No. 2 no later than the
Termination Date; provided, however, that, pending the Termination Date, any
advances obtained under this Facility shall be repaid, in installments, based on
a four year straight-line monthly principal amortization schedule, commencing on
the first day of the calendar month following the date on which each such
advance is disbursed.

4.       INTEREST

         4.1      Interest Rate

                  (a)      Unless the Borrowers elect the optional interest rate
described below, the interest rate payable on advances outstanding under
Facility No. 1 and Facility No. 2 (the "Facilities" or a "Facility") shall be
based on the Bank's Reference Rate (described below), plus the addition of a
spread, as described more particularly in Paragraphs 2.4(a) and 3.4(a).

                  (b)      The "Reference Rate" is the rate of interest publicly
announced from time to time by Bank of America, National Trust and Saving
Association ("BofA") in San Francisco, California, as its Reference Rate. The
Reference Rate is set by BofA based on various factors, including its costs and
desired return, general economic conditions and other factors, and is used as a
reference point for pricing some loans. BofA may price loans to its customers
at, above, or below the Reference Rate. Any change in the Reference Rate shall
take effect at the opening of business on the day specified in the public
announcement of a change in BofA's Reference Rate.

         4.2      Optional Interest Rate. Instead of an interest rate based on
the Reference Rate, the Borrowers may elect to have all or portions of their
outstanding advances (herein called a "LIBOR Rate Portion") bear interest based
on the "LIBOR Rate" (described below), plus the addition of a spread, as
described more particularly in Paragraphs 2.4(a) and 3.4(a). Designation of a
LIBOR Rate portion is subject to the following requirements:




                                      -10-
<PAGE>   18



                  (a)      The interest period during which the LIBOR Rate will
be in effect will be one, two, three or six months. The first day of the
interest period must be a day other than a Saturday or a Sunday on which BofA is
open for business in California, New York and London and dealing in offshore
dollars (a "LIBOR Banking Day"). The last day of the interest period and the
actual number of days during the interest period will be determined by the Bank
using the practices of the London interbank market. No interest period may
extend beyond the Termination Date, however.

                  (b)      Each LIBOR Rate portion will be for an amount not
less than $500,000, and no more than four (4) LIBOR Rate portions, in total, per
each Facility, may be outstanding at any one time.

                  (c)      The "LIBOR Rate" means the interest rate determined
by the following formula, rounded upward to the nearest 1/100th of one percent.
(All amounts in the calculation will be determined by the Bank as of the first
day of the interest period.)

                   LIBOR Rate =    London Inter-Bank Offered Rate
                                   ------------------------------
                                     (1.00 - Reserve Percentage)

     Where,

                  (i)      "London Inter-Bank Offered Rate" means the interest
rate at which BofA's London Branch, London, Great Britain, would offer U.S.
dollar deposits in amounts comparable to the LIBOR Rate Portion for the
applicable interest period to other major banks in the London inter-bank market
at approximately 11:00 a.m. London time two (2) London Banking Days before the
commencement of the interest period. A "London Banking Day" is a day on which
BofA's London Branch is open for business and dealing in offshore dollars.

                  (ii)     "Reserve Percentage" means the total of the maximum
reserve percentages for determining the reserves to be maintained by member
banks of the Federal Reserve System for Eurocurrency Liabilities, as defined in
Federal Reserve Board Regulation D, rounded upward to the nearest 1/100th of one
percent. The percentage will be expressed as a decimal, and will include, but
not be limited to, marginal, emergency, supplemental, special, and other reserve
percentages.

                  (d)      The Borrowers shall irrevocably request a LIBOR Rate
portion no later than 9:00 a.m. Atlanta time on the LIBOR Banking Day preceding
the day on which the London Inter-Bank Offered Rate will be set, as specified
above; that is, three (3) LIBOR Banking Days before the date on which the
requested advance is to be made.





                                      -11-
<PAGE>   19



                  (e)      The Borrowers may not elect a LIBOR Rate with respect
to any principal amount which is scheduled to be repaid before the last day of
the applicable interest period.

                  (f)      Any portion of an advance already bearing interest at
the LIBOR Rate will not be converted to a different rate during its interest
period.

                  (g)      Each prepayment of a LIBOR Rate portion, whether
voluntary, by reason of acceleration or otherwise, will be accompanied by the
amount of accrued interest on the amount prepaid and by a prepayment fee, which
shall be equal to the amount (if any) by which:

                  (i)      the additional interest which would have been payable
at the LIBOR Rate, without the addition of any spread; i.e., add-on, during the
Reinvestment Period (as defined below) on the amount prepaid had it not been
prepaid, exceeds

                  (ii)     the interest which would have been recoverable by the
Bank by relending the amount prepaid at the Reinvestment Rate, for a period
starting on the date on which it was prepaid and ending on the last day of the
interest period for such portion (or the scheduled payment date for the amount
prepaid, if earlier) (the "Reinvestment Period"). The "Reinvestment Rate" shall
be the LIBOR Rate, without the addition of any spread, determined as of the date
of the prepayment, for the entire Reinvestment Period.

                  (h)      The Bank will have no obligation to accept an
election for a LIBOR Rate portion if any of the following described events has
occurred and is continuing:

                  (a)      Dollar deposits in the principal amount, and for
periods equal to the interest period, of a LIBOR Rate portion are not available
in the London inter-bank market;

                  (b)      the LIBOR Rate does not accurately reflect the cost
of a LIBOR Rate portion; or

                  (c)      the Borrowers are in default.

5.   COLLATERAL

         5.1      Personal Property. The Borrowers' obligations to the Bank
under this Agreement will be secured by all personal property which the
Borrowers now own or will





                                      -12-
<PAGE>   20



own in the future and, at the Bank's option, all or portions of any real
property (or interests in real property) owned or acquired by the Borrowers from
time to time. Collateral shall specifically include, but not be limited to, all
accounts receivables and general intangibles of each Borrower, all equipment of
each Borrower and the capital stock of each Borrower (other than the capital
stock of EMI, and except for any capital stock which, now or hereafter, is
encumbered in accordance with Section 9.9(e)). The collateral is further defined
in security agreement(s) executed by the Borrowers. In addition, all collateral
securing this Agreement shall also secure all other present and future
obligations of the Borrowers to the Bank. All collateral securing any other
present or future obligations of the Borrowers to the Bank shall also secure
this Agreement.

6. DISBURSEMENTS, PAYMENTS AND COSTS

         6.1      Requests for Credit. Each request for an extension of credit
will be made in writing in a manner acceptable to the Bank, or by another means
acceptable to the Bank, to be issued by EMI, as agent for and on behalf of all
the Borrowers.

         6.2      Disbursements and Payments. Each disbursement by the Bank and
each payment by the Borrowers will be: (a) made at the Bank's branch (or other
location) selected by the Bank from time to time; (b) made for the account of
the Bank's branch selected by the Bank from time to time; (c) made in
immediately available funds, or such other type of funds selected by the Bank;
and (d) evidenced by records kept by the Bank. In addition, the Bank may, at its
discretion, require the Borrowers to sign one or more promissory notes to
evidence the debt arising from such disbursements.

         6.3      Direct Debit. The Borrowers agree that after their default in
the payment of any such obligation, the Bank may create advances under Facility
No. 1 to pay interest, principal payments, and any fees that are due under this
Agreement. The Bank will create such advances on the dates the payments become
due. If a due date does not fall on a banking day, the Bank will create the
advance on the first banking day following the due date. If the creation of an
advance under Facility No. 1 causes the total amount of credit outstanding under
Facility No. 1 to exceed the limitations set forth in this Agreement, the
Borrowers will immediately pay the excess to the Bank upon the Bank's demand.
The foregoing shall not constitute a waiver by the Bank of any such default.

         6.4      Banking Days. Unless otherwise provided in this Agreement, a
"banking day" is a day other than a Saturday or a Sunday on which the Bank is
open for business in Georgia. All payments and disbursements which would be due
on a day which is not a banking day will be due on the next banking day. All
payments received on a day which is not a banking day will be applied to the
credit on the next banking day.






                                      -13-
<PAGE>   21




         6.5      Taxes.

                  (a)      If any payments to the Bank under this Agreement are
made from outside the United States, the Borrowers will not deduct any foreign
taxes from any payments it makes to the Bank. If any such taxes are imposed on
any payments made by the Borrower (including payments under this paragraph), the
Borrowers will pay the taxes and will also pay to the Bank, at the time interest
is paid, any additional amount which the Bank specifies as necessary to preserve
the after-tax yield the Bank would have received if such taxes had not been
imposed. The Borrowers will confirm that they have paid any such taxes by giving
the Bank of official tax receipts (or notarized copies) within 30 days after the
due date.

                  (b)      Payments made by the Borrowers to the Bank will be
made without deduction of United States withholding or similar taxes. If the
Borrowers are required to pay U.S. withholding taxes, the Borrowers will pay
such taxes in addition to the amounts due to the Bank under this Agreement. If
the Borrowers fail to make such tax payments when due, each of the Borrowers
indemnifies the Bank against any liability for such taxes, as well as for any
related interest, expenses, additions to tax, or penalties asserted against or
suffered by the Bank with respect to such taxes.

         6.6      Additional Costs. The Borrowers will pay the Bank, on demand,
for the Bank's costs or losses arising from any statute or regulation, or any
request or requirement of a regulatory agency which is applicable to all
national banks or a class of all national banks. The costs and losses will be
allocated to the advances in a manner determined by the Bank, using any
reasonable method. The costs include the following: (a) any reserve or deposit
requirements; and (b) any capital requirements relating to the Bank's assets and
commitments for credit.

         6.7      Interest Calculation. Except as otherwise stated in this
Agreement, all interest and fees, if any, will be computed on the basis of a
360-day year and the actual number of days elapsed. This results in more
interest or a higher fee than if a 365-day year is used.

         6.8      Default Rate. Upon the occurrence and during the continuation
of any default under this Agreement, principal amounts outstanding under this
Agreement will at the option of the Bank bear interest at a rate which is two
percent (2%) per annum higher than the rate of interest otherwise provided under
this Agreement. This will not constitute a waiver of any default. Installments
of principal which are not paid when due under this Agreement shall continue to
bear interest until paid. Any interest, fees or costs which are





                                      -14-
<PAGE>   22



not paid when due shall bear interest at the Reference Rate plus two percent 
(2%) per annum. This may result in compounding of interest.

         6.9      Overdrafts. At the Bank's sole option in each instance, the
Bank may do one of the following:

                  (a)      The Bank may make advances under this Agreement to
prevent or cover an overdraft on any account of the Borrowers with the Bank or
BofA. Each such advance will accrue interest from the date of the advance or the
date on which the account is overdrawn, whichever occurs first, at the Reference
Rate plus two percent (2%) per annum.

                  (b)      The Bank may reduce the amount of credit otherwise
available under this Agreement by the amount of any overdraft on any account of
the Borrowers with the Bank or BofA.

This paragraph shall not be deemed to authorize he Borrowers to create
overdrafts on any of the Borrower's accounts with the Bank or BofA.

         6.10     Payments in Kind. If the Bank requires delivery in kind of the
proceeds of collection of any Borrower's accounts receivable, such proceeds
shall be credited to interest, principal, and other sums owed to the Bank under
this Agreement in the order and proportion determined by the Bank in its sole
discretion. All such credits will be conditioned upon collection and any
returned items may, at the Bank's option, be charged to the Borrowers.

7.  CONDITIONS

         The Bank must receive the following items, in form and content
acceptable to the Bank, before it is required to extend any credit to the
Borrowers under this Agreement:

         7.1      Authorizations. Evidence that the execution, delivery and
performance by the Borrowers of this Agreement and any instrument or agreement
required under this Agreement have been duly authorized.

         7.2      Governing Documents. A copy of each Borrower's articles of
incorporation and bylaws.






                                      -15-
<PAGE>   23



         7.3      Security Agreements. Signed original security agreements,
assignments, financing statements and fixture filings (together with collateral
in which the Bank requires a possessory security interest), which the Bank may
require from any Borrower.

         7.4      Evidence of Priority. Evidence that security interests and
liens in favor of the Bank are valid, enforceable, and prior to all others'
rights and interests, except as provided in Paragraph 9.9.

         7.5      Insurance. Evidence of insurance coverage, as required in
Paragraph 9.22.

         7.6      Legal Opinion. A written opinion from the Borrowers' legal
counsel, covering such matters as the Bank may require. The legal counsel and
the terms of the opinion must be acceptable to the Bank.

         7.7      Good Standing. Certificates of good standing for each Borrower
from its state of formation and from any other state in which each Borrower is
required to qualify to conduct its business.

         7.8      Payment of Closing Fee. Payment upon execution of this
Agreement of a non-refundable closing fee of Thirty-Five Thousand Dollars
($35,000).

         7.9      Payment of Expenses and Fees. Payment of all accrued and
unpaid expenses incurred by the Bank as required by Paragraph 12.6.

         7.10     Representations of Corporate Officers. A completed original of
the Bank's form of Representations and Warranties of Corporate Officers executed
by the principal of officers of each Borrower.

         7.11     Other Items. Any other items that the Bank reasonably
requires.

8.       REPRESENTATIONS AND WARRANTIES

         When the Borrowers sign this Agreement, and until the Bank is repaid in
full, the Borrowers make the following representations and warranties. Each
request for an extension of credit (including any letter of credit) constitutes
a renewed representation:

         8.1      Organization of Borrower. Each Borrower is a corporation duly
formed and existing under the laws of the state where organized.





                                      -16-
<PAGE>   24



         8.2      Authorization. This Agreement, and any instrument or agreement
required hereunder, are within the Borrowers' powers, have been duly authorized,
and do not conflict with any of their organizational papers.

         8.3      Enforceable Agreement. This Agreement is a legal, valid and
binding agreement of the Borrowers, enforceable against the Borrowers in
accordance with its terms, and any instrument or agreement required hereunder,
when executed and delivered, will be similarly legal, valid, binding and
enforceable.

         8.4      Good Standing. In each state in which a Borrower does
business, it is properly licensed, in good standing, and, where required, in
compliance with fictitious name statutes.

         8.5      No Conflicts. This Agreement does not conflict with any law,
agreement, or obligation by which any Borrower is bound.

         8.6      Financial Information. All financial and other information
that has been or will be supplied to the Bank, including the Borrowers'
financial statements as of and for the most recently completed fiscal quarter of
the Borrowers for which financial statements are available, is:

                  (a)      sufficiently complete to give the Bank accurate
knowledge of the Borrowers' financial condition.

                  (b)      in compliance with all government regulations that
apply.

Since the date of the financial statements specified above, there has been no
material adverse change in the business condition (financial or otherwise),
operations, properties or prospects of the Borrowers.

                  8.7      Lawsuits. There is no lawsuit, tax claim or other
dispute pending or threatened against any Borrower which, if lost, would impair
such Borrower's financial condition or ability to repay the loan, except as have
been disclosed in writing to the Bank.

                  8.8      Collateral. All collateral required in this Agreement
is owned by the grantor of the security interest free of any title defects or
any liens or interests of others, except for those title defects, liens or
interests of others, as applicable thereto, specified in Paragraph 9.9.






                                      -17-
<PAGE>   25




                  8.9      Permits Franchises. The Borrowers possess all
permits, memberships, franchises, contracts and licenses required and all
trademark rights, trade name rights, patent rights and fictitious name rights
necessary to enable it to conduct the business in which it is now engaged.

                  8.10     Other Obligations. The Borrowers are not in default
on any obligation for borrowed money, any purchase money obligation or any other
material lease, commitment, contract, instrument or obligation.

                  8.11     Income Tax Returns. The Borrowers have no knowledge
of any pending assessments or adjustments of their income tax liabilities for
any year.

                  8.12     No Tax Avoidance Plan. The Borrowers' obtaining of
credit from the Bank under this Agreement does not have as a principal purpose
the avoidance of U.S. withholding taxes.

                  8.13     No Event of Default. There is no event which is, or
with notice or lapse of time or both would be, a default under this Agreement.

                  8.14     ERISA Plans.

                           (a)      The Borrowers have fulfilled their
obligations, if any, under the minimum funding standards of ERISA and the Code
with respect to each Plan and are in compliance in all material respects with
the presently applicable provisions of ERISA and the Code, and have not incurred
any liability with respect to any Plan under Title IV of ERISA.

                           (b)      No reportable event has occurred under
Section 4043(b) of ERISA for which the PBGC requires 30 day notice.

                           (c)      No action by the Borrowers to terminate or
withdraw from any Plan has been taken and no notice of intent to terminate a
Plan has been filed under Section 4041 of ERISA.

                           (d)      No proceeding has been commenced with
respect to a Plan under Section 4042 of ERISA, and no event has occurred or
condition exists which might constitute grounds for the commencement of such a
proceeding.

                           (e)      The following terms have the meanings
indicated for purposes of this Agreement:





                                      -18-
<PAGE>   26



                           (i)      "Code" means the Internal Revenue Code of
1986, as amended from time to time.

                           (ii)     "ERISA" means the Employee Retirement Income
Security Act of 1974, as amended from time to time.

                           (iii)    "PBGC" means the Pension Benefit Guaranty
Corporation established pursuant to Subtitle A of Title IV of ERISA.

                           (iv)     "Plan" means any employee pension benefit
plan maintained or contributed to by the Borrowers and insured by the Pension
Benefit Guaranty Corporation under Title IV of ERISA.

         8.15     Locations of Borrowers. Each Borrower's place of business (or,
if such Borrower has more than one place of business, its chief executive
office) is located at the address listed under such Borrower's signature on this
Agreement.

         8.16     Subsidiaries. No Borrower, except EMI, has any subsidiaries,
except as disclosed on Schedule 8.16 attached hereto. All subsidiaries of EMI
are Borrowers under this Agreement.

9.  COVENANTS

         The Borrowers agree, so long as credit is available under this
Agreement and until the Bank is repaid in full:

         9.1      Use of Proceeds. To use the proceeds of the credit only for
working capital and general operating needs under Facility No. l and permitted
acquisitions under Facility No. 2.

         9.2      Financial Information. To provide the following financial
information and statements in form and content acceptable to the Bank, and such
additional information as requested by the Bank from time to time:

                  (a)      Within 120 days following the end of EMI's fiscal
year (1) consolidated financial statements meeting the requirements of
regulation S-X ("Regulation S-X") promulgated by the Securities Exchange
Commission ("SEC") for financial statements to be included in EMI's Annual
Report on Form 10-K to be filed with the SEC pursuant to the provisions of the
Securities Exchange Act of 1934 (the "34 Act") audited



                                      -19-
<PAGE>   27



(with an unqualified opinion) by a firm of certified public accountants
acceptable to the Bank; (2) unaudited annual consolidating statements of
operations; and (3) audited balance sheets and statements of operations for the
individual schools operated by EMI, likewise accompanied by the unqualified
opinion of such certified public accountants.

                  (b)      Within 45 days of EMI's first, second and third
fiscal quarter (i) unaudited consolidated financial statements meeting the
requirements of regulation S-X for financial statements to be included in EMI's
Quarterly Report on Form 10-Q to be filed with the SEC pursuant to the
provisions of the "34 Act," (ii) unaudited quarterly consolidating statements of
operations for the applicable quarter, and (iii) unaudited statements of
operations for the individual schools operated by EMI.

                  (c)      Within 30 days of the period's end, EMI's monthly (i)
unaudited consolidated statements of operations for the applicable period, (ii)
unaudited monthly consolidating statements of operations for the applicable
period, and (iii) unaudited statements of operations for the individual schools
operated by EMI for the applicable period.

                  (d)      Copies of EMI's Form 10-K Annual Report and Form 10-Q
Quarterly Report within 5 days after the date of filing with the Securities and
Exchange Commission, copies of EMI's Form 8-K Current Report within 1 business
day after the date of its filing with the Securities and Exchange Commission and
copies of any news releases within 1 business day after their publication.

                  (e)      Within the period(s) provided in (a), (b) and (c)
above, a compliance certificate of the Borrowers signed by an authorized
financial of officer of EMI, as agent for the Borrowers, setting forth (i) the
information and computations (in sufficient detail) to establish that the
Borrowers are in compliance with all financial covenants contained herein at the
end of the period covered by the financial statements then being furnished and
(ii) whether there existed as of the date of such financial statements and
whether there exists as of the date of the certificate, any default under this
Agreement and, if any such default exists, specifying the nature thereof and the
action the Borrowers are taking and propose to take with respect thereto.

                  (f)      A borrowing certificate, signed by EMI as agent for
the Borrowers, setting forth the amount of Acceptable Receivables as of the last
day of each fiscal quarter within 45 days after each quarter end, and on a pro
forma basis in connection with each proposed advance under Facility No. 2.




                                      -20-
<PAGE>   28




                  (g)      Statements showing an aging and reconciliation of the
Borrowers' receivables upon Bank's request.

                  (h)      A statement showing an aging of accounts payable of
the Borrowers upon Bank's request.

                  (i)      A listing of the names and addresses of all debtors
obligated upon the Borrowers' accounts receivable upon the Bank's request.

                  (j)      Promptly upon the Bank's request, such other
statements, lists of property and accounts, budgets, forecasts, reports or
information as to the Borrowers, any school, or group of schools, and as to each
guarantor of the Borrowers' obligations to the Bank as the Bank may request from
time to time.

                  (k)      a report of continuing compliance and eligibility in
respect of all Title IV Program Requirements within 120 days after each fiscal
year end of EMI, such report to demonstrate, among other things, each school's
continuing maintenance of prescribed financial responsibility standards which
are part of the Title IV Program Requirements, to include calculations
demonstrating maintenance of at least the following: (i) a 1:1 "acid test;" (ii)
a positive tangible net worth; and (iii) net operating results (two years) which
do not show an aggregate net loss of 10% of tangible net worth.

         9.3      Net Worth. To have a book net worth of at least the amounts
described below as of each fiscal quarter end in each fiscal period described
below:

<TABLE>
<CAPTION>
          Fiscal Period                                     Amount
          -------------                                     ------
          <S>                                               <C>
          March 31, 1997 through March 30, 1998             $25,500,000
          March 31, 1998 through March 30, 1999             $28,000,000
          March 31, 1999 through March 30, 2000             $31,000,000
          From and after March 31, 2000                     $31,000,000 plus 80%
                                                            of each Fiscal Years
                                                            net income on a
                                                            cumulative basis
                                                            (without deduction
                                                            for loss), starting
                                                            with FYE March 31,
                                                            2000
</TABLE>

"Book net worth" shall have the meaning given to such term under GAAP.





                                      -21-
<PAGE>   29




                                                                                
         9.4      Tangible Net Worth. To maintain a tangible net worth of at
least One Dollar ($1.00) at all times.

"Tangible net worth" means book net worth, as defined above, less the following:
goodwill, patents, trademarks, trade names, organization expense, treasury
stock, unamortized debt discount and expense, deferred research and development
costs, deferred marketing expenses, deferred income taxes, and any reserves
against assets, and other like intangibles, and monies due from any affiliates,
officers, directors, or shareholders; plus any purchase money debt owing to
sellers of schools subordinated to the Bank in a form, manner and substance
acceptable to the Bank to all of the Borrowers' obligations to the Bank.

         9.5      Fixed Charge Coverage Ratio. To maintain on a consolidated
basis a Fixed Charge Coverage Ratio of at least 1.75:1.

"Fixed Charge Coverage Ratio" means the ratio of (1) Adjusted EBIRTDA to (2) the
sum of interest expense, lease expense and rent expense plus scheduled debt
repayments, to the extent made, in the preceding four fiscal quarters. "Adjusted
EBIRTDA" means the sum of net income after taxes, plus interest expense, lease
expense and rent expense, plus tax expense, plus depreciation and amortization
expense, but less capital expenditures of EMI and its subsidiaries (excluding
therefrom any payment made in respect of permitted school acquisitions), on a
consolidated basis. This ratio will be calculated at the end of each fiscal
quarter of EMI, using the results of that quarter and each of the three
immediately preceding quarters.

         9.6      Total Funded Debt/Adjusted Cash Flow Coverage Ratio. To
maintain on a consolidated basis a Total Funded Debt/Adjusted Cash Flow Coverage
Ratio of not more than 3.0:1.

"Total Funded Debt/Adjusted Cash Flow Ratio" means the ratio of Total Funded
Debt to Adjusted Cash Flow. "Total Funded Debt" means purchase money debt
(including, without limitation, any such debts to sellers of schools, but
excluding trade payables) and indebtedness for money borrowed and guarantees of
such debts, including, without limitation, any debts represented by notes
payable, bonds, debentures, capitalized lease obligations and letters of credit
and any subordinated debt, of EMI and its subsidiaries, on a consolidated basis.
"Adjusted Cash Flow" means "EBITDA," as computed in Paragraph 3.3, less capital
expenditures (but excluding therefrom any capital expenditures made in respect
of permitted acquisitions of schools) less dividends, withdrawals, loans,
advances, and other distributions to any stockholders, of EMI and its
subsidiaries, on a consolidated basis. This ratio will be calculated at the end
of each fiscal quarter of EMI, using the results of that quarter and each of the
three immediately preceding quarters.




                                      -22-
<PAGE>   30


         9.7      Senior Funded Debt/Adjusted Cash Flow Ratio. To maintain a
Senior Funded Debt/Adjusted Cash Flow Ratio of not more than 2.0:1.

"Senior Funded Debt/Adjusted Cash Flow Ratio" means the ratio of "Senior Funded
Debt" to "Adjusted Cash Flow." Senior Funded Debt is equal to Total Funded Debt
(as defined above) less any such debt which has been subordinated, in a form,
manner and substance acceptable to the Bank, to all of the Borrowers'
obligations to the Bank. "Adjusted Cash Flow" has the meaning described above.
This ratio will be calculated at the end of each fiscal quarter, using the
results of that quarter and each of the three immediately preceding quarters.

         9.8      Other Debts. Not to have outstanding or incur any direct or
contingent liabilities or lease obligations (other than those to the Bank), or
become liable for the liabilities of others without the Bank's written consent.
This does not prohibit:

                  (a)      Acquiring goods, supplies, or merchandise on normal
trade credit.

                  (b)      Endorsing negotiable instruments received in the
usual course of business.

                  (c)      Obtaining surety bonds in the usual course of
business.

                  (d)      Liabilities in existence on the date of this
Agreement disclosed in the Borrowers' financial statements described in
Paragraph 8.6.

                  (e)      Additional debts and lease obligations for the
acquisition of fixed or capital assets, to the extent permitted elsewhere in
this Agreement.

                  (f)      unsecured (except for permitted stock pledges, as
described below) debt to sellers of schools.

                  (g)      Additional debts and lease obligations incurred for
business purposes not otherwise described in, and permitted by, subparagraphs
(a) through (f) above, which, in aggregate amount, do not exceed a total
principal amount of $2,000,000 outstanding at any one time.

         9.9      Other Liens. Not to create, assume, or allow any security
interest or lien (including judicial liens) on property the Borrowers now or
later own, except:




                                      -23-
<PAGE>   31






                  (a)      Deeds of trust and security agreements in favor of
the Bank.

                  (b)      Liens for taxes not yet due.

                  (c)      Liens outstanding on the date of this Agreement and
disclosed in writing to the Bank on Schedule 9.9 attached hereto.

                  (d)      Additional purchase money security interests in
personal or real property acquired after the date of this Agreement, if the
total principal amount of all debts secured by such liens does not exceed
$2,500,000 at any one time.

                  (e)      Pledges of a school's capital stock given to support
the payment of permitted purchase money debt to the seller of a school pursuant
to an acquisition permitted in Paragraph 9.23(e).

                  (f)      Liens which the DOE may claim in respect of certain
deposit accounts which the schools may be required to maintain for the receipt
of funds under Title IV Programs as part of the Title IV Program Requirements.

         9.10     Capital Expenditures. Not to spend more than the following
amounts in any specified fiscal year to acquire fixed or capital assets (except
any made for permitted school acquisitions under Paragraph 9.23(e)):

<TABLE>
<CAPTION>
          Fiscal Year
          Ending                                     Amount
          ------                                     ------

          <S>                                        <C>       
          March 31, 1997                             $2,000,000
          March 31, 1998                             $3,000,000
          March 31, 1999                             $4,000,000
</TABLE>

         9.11     Dividends. Not to declare or pay any dividends on any of its
shares except dividends payable to EMI by its subsidiaries and dividends payable
in capital stock of a Borrower; and not to purchase, redeem or otherwise acquire
for value any of its shares, or create any sinking fund in relation thereto.

         9.12     Loans and Investments. Not to make any loans or other
extensions of credit to, or make any investments in, or make any capital
contributions or other transfers of assets to, any individual or entity, except
for:





                                      -24-
<PAGE>   32



                  (a)      extensions of credit in the nature of accounts
receivable or notes receivable arising from the sale or lease of goods or
services in the ordinary course of business.

                  (b)      investments in any of the following: (i) marketable,
direct obligations of the United States of America and its agencies maturing
within three hundred sixty-five (365) days of the date of purchase, (ii)
commercial paper issued by corporations maturing 180 days from the date of
original issue is rated "P-1" or better by Moody's or "A-1" or better by S&P,
(iii) certificates of deposit maturing within 1 year of the date of purchase
issued by a United States national or state bank having deposits totaling more
than $250,000,000, and whose short-term debt is rated "P-1" or better by Moody's
or "A-1" or better by S&P, and (iv) investments made with, or through, the Bank
or BofA.

                  (c)      extensions of credit to and investments in other
Borrowers.

                  (d)      acquisitions of schools permitted under Paragraph
9.23(e).

         9.13     Change of Ownership. Not to cause, permit, or suffer any
change, direct or indirect, in (i) the capital ownership by EMI of its
subsidiaries; or (ii) the capital ownership of EMI, to the extent that a report
on Form 8-K is required to be filed with the Securities and Exchange Commission
disclosing a change in control.

         9.14     Notices to Bank. To promptly notify the Bank in writing of:

                  (a)      any lawsuit claiming damages over $100,000 against a
Borrower.

                  (b)      any dispute between a Borrower and any government
authority which the Bank determines, if resolved adversely to such Borrower,
would materially interfere with the conduct of such Borrower's business as then
being conducted by it.

                  (c)      any failure to comply with this Agreement.

                  (d)      any material adverse change in the Borrower's (or any
guarantor's) business condition (financial or otherwise), operations, properties
or prospects, or ability to repay the credit.

                  (e)      any change in a Borrower's name, legal structure,
place of business, or chief executive office if such Borrower has more than one
place of business.




                                      -25-
<PAGE>   33




                  (f)      any default or event of default under Paragraph 11.

         9.15     Books and Records. To maintain adequate books and records.

         9.16     Audits. To allow the Bank and its agents to inspect Borrowers'
properties and examine, audit and make copies of books and records at any
reasonable time. If any of the Borrowers' properties, books or records are in
the possession of a third party, the Borrowers authorize that third party to
permit the Bank or its agents to have access to perform inspections or audits
and to respond to the Bank's requests for information concerning such
properties, books and records.

         9.17     Compliance with Laws. To comply with the laws (including any
fictitious name statute), regulations, and orders of any government body with
authority over each Borrower's business (excepting therefrom, however, instances
of incidental noncompliance occurring from time to time in the ordinary course
of a Borrower's business without actual knowledge of a Borrower, which the Bank
determines are immaterial to the operation of its business and are capable of
being cured without any significant disruption to such business). The foregoing
shall include, specifically, but without limitation, compliance with all Title
IV Program Requirements, as prescribed with more particularity in Section 9.25.

         9.18     Preservation of Rights. To maintain and preserve all rights,
privileges, and franchises the Borrowers now have.

         9.19     Maintenance of Properties. To make any repairs, renewals, or
replacements to keep the Borrowers' properties in good working condition.

         9.20     Perfection of Liens. To help the Bank perfect and protect its
security interests and liens, and reimburse it for related costs it incurs to
protect its security interests and liens.

         9.21     Cooperation. To take any action reasonably requested by the
Bank to carry out the intent of this Agreement.

         9.22     Insurance.

                  (a)      Insurance Covering Collateral. To maintain all risk
property damage insurance policies covering the tangible property comprising the
collateral. Each insurance policy must be in an amount acceptable to the Bank.
The insurance must be





                                      -26-
<PAGE>   34




issued by an insurance company acceptable to the Bank and must include a
lender's loss payable endorsement in favor of the Bank in a form acceptable to
the Bank.

                  (b)      General Business Insurance. To maintain insurance
satisfactory to the Bank as to amount, nature and carrier covering property
damage (including loss of use and occupancy) to any Borrower's properties,
public liability insurance including coverage for contractual liability, product
liability and workers' compensation, and any other insurance which is usual for
the Borrowers' businesses.

                  (c)      Evidence of Insurance. Upon the request of the Bank,
to deliver to the Bank a copy of each insurance policy, or, if permitted by the
Bank, a certificate of insurance listing all insurance in force.

         9.23     Additional Negative Covenants. Not to, without the Bank's
written consent:

                  (a)      engage in any business activities substantially
different from the Borrowers' present businesses.

                  (b)      liquidate or dissolve any of the Borrowers'
businesses.

                  (c)      enter into any consolidation, merger, or other
combination, or become a partner in a partnership, a member of a joint venture,
or a member of a limited liability company, except (i) in connection with any
acquisition permitted under subparagraph (e) and (ii) that Subsidiaries of EMI
may merge, combine or consolidate with each other or with EMI (so long as, in
the case of any merger, combination or consolidation with EMI, EMI is the
survivor.

                  (d)      sell, lease, transfer or dispose of all or a
substantial part of a Borrower's business or a Borrower's assets, except, in the
case of any Borrower, to any other Borrower.

                  (e)      acquire or purchase a business or its assets;
provided, however, that, acquisitions of all, or substantially all, of the
assets of, or of all or a controlling interest in the shares of capital stock
of, any business engaged in the provision of career-oriented, postsecondary
education within the United States (herein, a "school"), shall be permitted, if,
but only if: (i) no default then exists under this Agreement, or would be caused
by, or would result from, such proposed acquisition (after giving pro forma
effect to such acquisition, in respect of the financial covenants set forth at
Paragraphs 9.3 through 9.7); (ii) the cost of such acquisition, inclusive of any
assumed liabilities, does not exceed (A)






                                      -27-
<PAGE>   35




$10,000,000, if no advance under Facility No. 2 is requested for its financing
or (B) $5,000,000 if any advance under Facility No. 2 is requested for its
financing; (iii) the incremental amount which the Borrower then may borrow under
Facility No. 1 (after giving pro forma effect to the proposed acquisition),
determined under subparagraphs (a) and (d) of Paragraph 2.1, is at least
$3,000,000; (iv) the school being acquired has a positive EBITDA (computed in
the same manner as is defined in Paragraph 3.3 in respect of EMI, after
adjustments by the Bank as necessary for excessive compensation amount and like
items) for its most recently concluded period of twelve (12) fiscal months; and
(v) the acquisition is not opposed by the board of directors of the school
proposed to be acquired; i.e, it is not a "hostile" acquisition. EMI, as agent
on behalf of the Borrowers, shall certify the foregoing to the Bank at the time
of such acquisition. Such certification shall include calculations of pro forma
compliance with Paragraphs 9.3 through 9.7 on both a consolidated basis
(including the school being acquired) and on a stand alone basis for such
school. The Bank has reserved to itself the right, in its sole discretion, to
consent in writing to any such acquisition notwithstanding the Borrower's
non-compliance with one or more of the foregoing conditions, but any such
consent may be made subject to such other terms and conditions as the Bank, in
its sole discretion, then may elect.

                  (f)      sell, assign, lease, transfer or otherwise dispose of
any assets, or enter into any agreement to do so, except:

                  (i)      dispositions of inventory, or used, worn-out or
surplus equipment, all in the ordinary course of business;

                  (ii)     the sale of equipment to the extent that such
equipment is exchanged for credit against the purchase price of similar
replacement equipment, or the proceeds of such sale are reasonably promptly
applied to the purchase price of such replacement equipment; and

                  (iii)    dispositions not otherwise permitted hereunder which
are made for fair market value; provided, that (i) at the time of any
disposition, no event of default shall exist or shall result from such
disposition, (ii) the aggregate sales price from such disposition shall be paid
in cash, and (iii) the aggregate value of all assets so sold by the Borrowers
shall not exceed in any fiscal year $250,000.

                  (g)      enter into any sale and leaseback agreement covering
any of its fixed or capital assets.

                  (h)      close, or voluntarily suspend the business of any
school for more than 30 days, if that school's contribution (computed as defined
in Paragraph 9.25) then





                                      -28-
<PAGE>   36



represents 5% or more of the total school contributions for the most recently
concluded period of four fiscal quarters.

         9.24     ERISA Plans. To give prompt written notice to the Bank of:

                  (a)      The occurrence of any reportable event under Section
4043(b) of ERISA for which the PBGC requires 30 day notice.

                  (b)      Any action by a Borrower to terminate or withdraw
from a Plan or the filing of any notice of intent to terminate under Section
4041 of ERISA.

                  (c)      Any notice of noncompliance made with respect to a
Plan under Section 4041(b) of ERISA.

                  (d)      The commencement of any proceeding with respect to a
Plan under Section 4042 of ERISA.

         9.25     Title IV Program Requirements. To maintain at all times all
Title IV Program Requirements for schools representing, in the aggregate, not
less than 80% of the total school contributions of all schools operated by the
Borrowers. For purposes hereof, "school contributions" for each school shall be
computed on a quarterly basis, for the most recently completed period of four
fiscal quarters, and shall be equal to each school's total revenue minus all
school operating costs (to include training expense, facility expense,
advertising expense, sales expense, administrative expense and bad debt
expense). "Total school contributions" of all schools shall be the aggregate of
each school's contribution.

         "Title IV Program Requirements" shall mean and include all eligibility,
program and general requirements imposed upon schools under Title IV programs
administered by the U.S. Department of Education ("DOE") under the Higher
Education Act of 1965, as amended, and the regulations thereunder ("Title IV
Programs"), including, without limitation, for each of the schools operated by
Borrowers (i) its continuing certification by the DOE as an "eligible
institution;" (ii) its continuing authorization to offer its programs by the
relevant state agency where it is located; (iii) its continuing accreditation by
a nationally recognized accrediting agency; (iv) its continuing compliance with
respect to maximum rates of default by its students with respect to federally
guaranteed or funded student loans; i.e., cohort default rates; (v) its
continuing satisfaction of certain financial responsibility standards; (vi) its
continuing compliance with standards for maximum acceptable proportions of
school revenues derived from Title IV programs, i.e., "85/15" rule; and (vii)
its continuing compliance in respect of changes in curriculum, location and
control. Without limitation of the foregoing, to the extent that any school is
at any time





                                      -29-
<PAGE>   37




required by the DOE to post a letter of credit, bond or other, similar evidence
of financial assurance as a condition to its remaining an "eligible
institution," the Bank, in its sole discretion, shall have the right to declare
that such school shall not be considered as maintaining all Title IV Program
Requirements for purposes of this Paragraph.

         9.26     Subsidiaries. Promptly upon its creation or acquisition, to
cause all subsidiaries of Borrowers hereafter created or acquired (including any
acquired as schools) to execute a joinder to this Agreement in form and
substance acceptable to the Bank whereby such subsidiary shall become a Borrower
hereunder.

10.  HAZARDOUS WASTE INDEMNIFICATION

         The Borrowers, jointly and severally, will indemnify and hold harmless
the Bank from any loss or liability directly or indirectly arising out of the
use, generation, manufacture, production, storage, release, threatened release,
discharge, disposal or presence of a hazardous substance. This indemnity will
apply whether the hazardous substance is on, under or about any Borrower's
property or operations or property leased to any Borrower. The indemnity
includes but is not limited to attorneys' fees (including the reasonable
estimate of the allocated cost of in-house counsel and staff). The indemnity
extends to the Bank, its parent, its and its parents subsidiaries (including
BofA) and all of their directors, officers, employees, agents, successors,
attorneys and assigns. For these purposes, the term "hazardous substances" means
any substance which is or becomes designated as "hazardous" or "toxic" under any
federal, state or local law. This indemnity will survive repayment of the
Borrowers' obligations to the Bank and this Agreement's termination.

11.  DEFAULT

         If any of the following events occurs (called in this Agreement a
"default" or "event of default"), the Bank may do one or more of the following:
declare the Borrowers in default, stop making any additional credit available to
the Borrowers, and require the Borrowers to repay the entire debt immediately
and without prior notice. If an event of default occurs under the paragraph
entitled "Bankruptcy," below, with respect to the Borrowers, then, the entire
debt outstanding under this Agreement will automatically be due immediately.

         11.1     Failure to Pay. A Borrower fails to make a payment under this
Agreement when due.





                                      -30-
<PAGE>   38



         11.2     Lien Priority. The Bank fails to have an enforceable first 
lien (except for any prior liens to which the Bank has consented in writing) 
on or security interest in any property given as security for the advances.

         11.3     False Information. A Borrower (or any guarantor) has given the
Bank false or misleading information or representations in respect of any
matter, event or occurrence which the Bank determines to be material.

         11.4     Bankruptcy. A Borrower (or any guarantor) files a bankruptcy
petition, a bankruptcy petition is filed against a Borrower (or any guarantor)
or a Borrower (or any guarantor) makes a general assignment for the benefit of
creditors. The default will be deemed cured if any bankruptcy petition filed
against a Borrower (or any guarantor) is dismissed within a period of 60 days
after the filing; provided, however, that the Bank will not be obligated to
extend any additional credit to the Borrowers during that period.

         11.5     Receivers. A receiver or similar official is appointed for any
Borrower's business, or the business is terminated.

         11.6     Lawsuits. Any lawsuit or lawsuits are filed on behalf of one
or more creditors against a Borrower in an aggregate amount of $100,000 or more
in excess of any insurance coverage.

         11.7     Judgments. Any judgments or arbitration awards are entered
against any Borrower (or any guarantor), or any Borrower (or any guarantor)
enters into any settlement agreements with respect to any litigation or
arbitration, in an aggregate amount of $100,000 or more in excess of any
insurance coverage.

         11.8     Government Action. Any government authority takes action that
the Bank believes materially adversely affects any Borrower's (or any
guarantor's) financial condition or ability to repay the advances.

         11.9     Material Adverse Change. A material adverse change occurs in
any Borrower's (or any guarantor's) business condition (financial or otherwise),
operations, properties or prospects, or ability to repay the advances.

         11.10    Cross-default. Any default occurs under any agreement in
connection with any credit which any Borrower (or any guarantor) or any
Borrower's related entities or affiliates has obtained from another lender else
or which any Borrower (or any guarantor) or any Borrowers related entices or
affiliates has guaranteed in the amount of $100,000 or



                                      -31-
<PAGE>   39





more in the aggregate if the default consists of failing to make a payment when
due or gives the other lender the right to accelerate the obligation.

         11.11    Default under Related Documents. Any guaranty, subordination
agreement, security agreement, deed of trust, or other document required by this
Agreement is violated or no longer in effect.

         11.12    Other Bank Agreements. A Borrower (or any guarantor) fails to
meet the conditions of, or fails to perform any obligation under any other
agreement which a Borrower (or any guarantor) has with the Bank, BofA or any
other affiliate of the Bank. If, in the Bank's opinion, the breach is capable of
being remedied, the breach will not be considered an event of default under this
Agreement for a period of 10 days after the date on which the Bank gives written
notice of the breach to the Borrowers; provided, however, that the Bank will not
be obligated to extend any additional credit to the Borrowers during that
period.

         11.13    ERISA Plans. The occurrence of any one or more of the
following events with respect to any Borrower, provided such event or events
could reasonably be expected, in the judgment of the Bank, to subject any
Borrower to any tax, penalty or liability (or any combination of the foregoing)
which, in the aggregate, could have a material adverse effect on the financial
condition of any Borrower with respect to a Plan:

                  (a)      A reportable event shall occur with respect to a Plan
which is, in the reasonable judgment of the Bank likely to result in the
termination of such Plan for purposes of Title IV of ERISA.

                  (b)      Any Plan termination (or commencement of proceedings
to terminate a Plan) or a Borrower's full or partial withdrawal from a Plan.

         11.14    Other Breach Under Agreement. The Borrowers fail to meet the
conditions of, or fail to perform any obligation under, any term of this
Agreement not specifically referred to in this Article. This includes any
failure or anticipated failure by the Borrowers to comply with any financial
covenants set forth in this Agreement, whether such failure is evidenced by
financial statements delivered to the Bank or is otherwise known to the
Borrowers or the Bank. If, in the Bank's opinion, the breach is capable of being
remedied, the breach will not be considered an event of default under this
Agreement for a period of 10 days after the date on which the Bank gives written
notice of the breach to the Borrowers; provided, however, that the Bank will not
be obligated to extend any additional credit to the Borrowers during that 
period.




                                      -32-
<PAGE>   40




12.      ENFORCING THIS AGREEMENT; MISCELLANEOUS

         12.1     GAAP. Except as otherwise stated in this Agreement, all
financial information provided to the Bank and all financial covenants will be
made under generally accepted accounting principles, consistently applied
(herein, "GAAP").

         12.2     Georgia Law. This Agreement is governed by Georgia law.

         12.3     Successors and Assigns. This Agreement is binding on each
Borrower's and the Bank's successors and assignees. The Borrowers agree that
they will not assign this Agreement without the Bank's prior consent. The Bank
may sell participations in or assign this loan, and may exchange financial
information about the Borrowers with actual or potential participants or
assignees. If a participation is sold or the loan is assigned, the purchaser
will have the right of set-off against the Borrowers.

         12.4     Arbitration.

                  (a)      Dispute Resolution. Any controversy or claim between
or among the parties or their assignees arising out of or relating to this
Agreement or any agreements or instruments relating hereto or delivered in
connection herewith, including any claim based on or arising from an alleged
tort, shall at the request of any party be determined by arbitration, reference,
or trial by a judge as provided hereafter. A controversy involving only a single
claimant, or claimants who are related or asserting claims arising from a single
transaction, shall be determined by arbitration as described below. Any other
controversy shall be determined by judicial reference of the controversy to a
referee appointed by the court or, if the court where the controversy is venued
lacks the power to appoint a referee, by trial by a judge without a jury, as
described below. THE PARTIES AGREE AND UNDERSTAND THAT THEY ARE GIVING UP THE
RIGHT TO TRIAL BY JURY, AND THERE SHALL BE NO JURY WHETHER THE CONTROVERSY OR
CLAIM IS DECIDED BY ARBITRATION, BY JUDICIAL REFERENCE, OR BY TRIAL BY A JUDGE.

                  (b)      Arbitration. Since this Agreement touches and
concerns interstate commerce, an arbitration under this Agreement shall be
conducted in accordance with the United States Arbitration Act (Title 9, United
States Code), notwithstanding any choice of law provision in this Agreement. The
Commercial Rules of the American Arbitration Association ("AAA") also shall
apply. The arbitrator(s) shall follow the law and shall give effect to statutes
of limitation in determining any claim. Any controversy concerning whether an
issue is arbitrable shall be determined by the arbitrator(s). The award of the
arbitrator(s) shall be in writing and include a statement of reasons for the




                                      -33-
<PAGE>   41



award. The award shall be final. Judgment upon the award may be entered in any
court having jurisdiction, and no challenge to entry of judgment upon the award
shall be entertained except as provided by Section 10 of the United States
Arbitration Act or upon a finding of manifest injustice.

                  (c)      Judicial Reference or Trial by a Judge. At the 
request of any party, any controversy or claim under subparagraph (a) that is
not submitted to arbitration as provided in subparagraph (b) shall be
determined by reference to a referee appointed by the court who, sitting alone
and without a jury, shall decide all questions of law and fact. The parties
shall designate to the court a referee selected under the auspices of the AAA
in the same manner as arbitrators are selected in AAA-sponsored proceedings.
The referee shall be an active attorney or retired judge. If the court where
the controversy is venued lacks the power to appoint a referee, the controversy
instead shall be decided by trial by a judge without a jury.

                  (d)      Self-Help, Foreclosure, and Provisional Remedies. No
provision of this paragraph shall limit the right of any party to this Agreement
to exercise self-help remedies such as set off or repossession, to foreclose by
power of sale or judicially against or sell any collateral or security, or to
obtain any provisional or ancillary remedies from a court of competent
jurisdiction before, after, or during the pendency of any arbitration under
subparagraph (6), above. Neither the obtaining nor the exercise of any such
remedy shall waive the right of either party to demand that the related or any
other dispute or controversy be determined by arbitration as provided above.

         12.5     Severability; Waivers. If any part of this Agreement is not
enforceable, the rest of the Agreement may be enforced. The Bank retains all
rights, even if it makes an advance after default. If the Bank waives a default,
it may enforce a later default. Any consent or waiver under this Agreement must
be in writing.

         12.6     Reimbursement Costs. The Borrowers agree to reimburse the Bank
immediately for any expenses it incurs in the preparation of this Agreement and
any agreement or instrument required by this Agreement. Expenses include, but
are not limited to, reasonable attorneys' fees, including any allocated costs of
the Bank's in-house counsel, filing, recording and search fees, appraisal fees,
title report fees and documentation fees.

         12.7     Administration Costs. The Borrowers shall pay the Bank for all
reasonable costs incurred by the Bank in connection with administering this
Agreement.

         12.8     Attorneys' Fees. The Borrowers shall reimburse the Bank for
any reasonable costs and attorneys' fees incurred by the Bank in connection with
the





                                      -34-
<PAGE>   42



enforcement or preservation of any rights or remedies under this Agreement and
any other documents executed in connection with this Agreement, and including
any amendment, waiver, "workout" or restructuring under this Agreement. In the
event of a lawsuit or arbitration proceeding, the prevailing party is entitled
to recover costs and reasonable attorneys' fees incurred in connection with the
lawsuit or arbitration proceeding, as determined by the court or arbitrator. In
the event that any case is commenced by or against the Borrowers under the
Bankruptcy Code (Title 11, United States Code) or any similar or successor
statute, the Bank is entitled to recover costs and reasonable attorneys' fees
incurred by the Bank related to the preservation, protection, or enforcement of
any rights of the Bank in such a case. As used in this paragraph, "attorneys'
fees" includes the allocated costs of the Bank's in-house counsel.

         12.9     Joint and Several Liability.

                  (a)      Each Borrower agrees that it is jointly and severally
liable to the Bank for the payment of all obligations arising under this
Agreement, and that such liability is independent of the obligations of the
other Borrower(s) (or any guarantor). The Bank may bring an action against any
Borrower, whether an action is brought against the other Borrower(s) (or any
guarantor).

                  (b)      Each Borrower agrees that any release which may be
given by the Bank to the other Borrower(s) (or any guarantor) will not release
such Borrower from its obligations under this Agreement.

                  (c)      Each Borrower waives any right to assert against the
Bank any defense, setoff, counterclaim, or claims which such Borrower may have
against the other Borrower(s) or any other party (including any grantor) liable
to the Bank for the obligations of the Borrowers under this Agreement.

                  (d)      Each Borrower agrees that it is solely responsible
for keeping itself informed as to the financial condition of the other
Borrower(s) and of all circumstances which bear upon the risk of nonpayment.
Each Borrower waives any right it may have to require the Bank to disclose to
such Borrower any information which the Bank may now or hereafter acquire
concerning the financial condition of the other Borrower(s).

                  (e)      Each Borrower waives all rights to notices of default
or nonperformance by any other Borrower under this Agreement. Each Borrower
further waives all rights to notices of the existence or the creation of new
indebtedness by any other Borrower.



                                      -35-
<PAGE>   43




                  (f)      The Borrowers represent and warrant to the Bank that
they each will derive benefit, directly and indirectly, from the collective
administration and availability of credit under this Agreement. The Borrowers
agree that the Bank will not be required to inquire as to the disposition by any
Borrower of funds disbursed in accordance with the terms of this Agreement.

                  (g)      Each Borrower waives any right of subrogation,
reimbursement, indemnification and contribution (contractual, statutory or
otherwise), including without limitation, any claim or right of subrogation
under the Bankruptcy Code (Title 11 of the U.S. Code) or any successor statute,
which such Borrower may now or hereafter have against any other Borrower with
respect to the indebtedness incurred under this Agreement, unless and until this
Agreement is terminated and all debts to the Bank arising hereunder have been
fully paid and satisfied. Each Borrower further waives any right to enforce any
remedy which the Bank now has or may hereafter have against any other Borrower,
and waives any benefit of, and any right to participate in, any security now or
hereafter held by the Bank.

         12.10    One Agreement. This Agreement and any related security or
other agreements required by this Agreement, collectively:

                  (a)      represent the sum of the understandings and
agreements between the Bank and the Borrowers concerning this credit;

                  (b)      replace any prior oral or written agreements between
the Bank and the Borrowers concerning this credit; and

                  (c)      are intended by the Bank and the Borrowers as the
final, complete and exclusive statement of the terms agreed to by them.

In the event of any conflict between this Agreement and any other agreements
required by is Agreement, this Agreement will prevail.

         12.11    Disposition of Schedules. The Bank will not be obligated to
return any schedules, invoices, statements, budgets, forecasts, reports or other
papers delivered by the Borrowers. The Bank will destroy or otherwise dispose of
such materials at such time as the Bank, in its discretion, deems appropriate.

         12.12    Credit Adjustments. Until the Bank exercises its rights to
collect the accounts receivable as provided under any security agreement
required under this Agreement, the Borrowers may continue their present policies
for credit adjustments. If a




                                      -36-
<PAGE>   44



credit adjustment is made with respect to any Acceptable Receivable, the amount
of such adjustment shall no longer be included in the amount of such Acceptable
Receivable in computing the Borrowing Base.

         12.13    Verification of Receivables. The Bank may at any time, either
orally or in writing, request confirmation from any debtor of the current amount
and status of the accounts receivable upon which such debtor is obligated.

         12.14    Indemnification. The Borrowers will indemnify and hold the
Bank harmless from any loss, liability, damages, judgments, and costs of any
kind relating to or arising directly or indirectly out of (a) this Agreement or
any document required hereunder, (b) any credit extended or committed by the
Bank to the Borrowers hereunder, (c) any claim, whether well-founded or
otherwise, that there has been a failure to comply with any law regulating the
Borrowers' sales or leases to or performance of services for debtors obligated
upon the Borrowers' accounts receivable and disclosures in connection therewith,
and (d) any litigation or proceeding related to or arising out of this
Agreement, any such document, any such credit, or any such claim. This indemnity
includes but is not limited to attorneys' fees (including the allocated cost of
in-house counsel). This indemnity extends to the Bank, its parent, its and its
parent's subsidiaries (including BofA) and all of their directors, officers,
employees, agents, successors, attorneys, and assigns. This indemnity will
survive repayment of the Borrowers' obligations to the Bank and this Agreement's
termination. All sums due to the Bank hereunder shall be obligations of the
Borrowers, due and payable immediately without demand.

         12.15    Notices. All notices required under this Agreement shall be
personally delivered or sent by first class mail, postage prepaid, to the
addresses on the signature page of this Agreement, or to such other addresses as
the Bank and the Borrowers may specify from time to time in writing.

         12.16    Headings. Article and paragraph headings are for reference
only and shall not affect the interpretation or meaning of any provisions of
this Agreement.

         12.17    Counterparts. This Agreement may be executed in as many
counterparts as necessary or convenient, and by the different parties on
separate counterparts each of which, when so executed, shall be deemed an
original but all such counterparts shall constitute but one and the same
agreement.





                                      -37-
<PAGE>   45



This Agreement is executed as of the date stated at the top of the first page.

BANK OF AMERICA, FSB               EDUCATIONAL MEDICAL, INC.

By                                 By   /s/ Vince Pisano
  ------------------------            ----------------------------------------

Typed Name                         Typed Name     Vince Pisano
          ----------------                    --------------------------------

Title                              Title Vice President and Chief Financial
     ---------------------               -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

Address where notices to           Address where notices to
the Bank are to be sent:           the Borrowers are to be sent:

1230 Peachtree Street, Suite 3600  1327 Northmeadow Parkway, Suite 132
Atlanta, Georgia 30309             Roswell, Georgia 30076




                                      -38-
<PAGE>   46



                                   ANDON COLLEGES, INC.

                                   By   /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076




                                      -39-

<PAGE>   47



                                   CALIFORNIA ACADEMY OF
                                   MERCHANDISING, ART AND DESIGN, INC.

                                   By   /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076




                                      -40-
<PAGE>   48




                                   DBS ACQUISITION CORP.

                                   By   /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name     Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076






                                      -41-
<PAGE>   49





                                   DEST EDUCATION CORPORATION

                                   By   /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name     Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076









                                      -42-
<PAGE>   50



                                   ICM ACQUISITION CORP.

                                   By   /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name     Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076







                                      -43-
<PAGE>   51



                                   HBC ACQUISITION CORP.

                                   By   /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name     Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076






                                      -44-
<PAGE>   52



                                   MARIC LEARNING SYSTEMS

                                   By   /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name     Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076




                                      -45-
<PAGE>   53




                                   MTSX ACQUISITION CORP.

                                   By   /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name     Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076







                                      -46-
<PAGE>   54



                                   OIOPT ACQUISITION CORP.

                                   By /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name   Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076









                                      -47-
<PAGE>   55





                                   PALO VISTA COLLEGE OF NURSING AND
                                   ALLIED HEALTH SCIENCES, INC.

                                   By /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name   Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076









                                      -48-
<PAGE>   56




                                   SACMD ACQUISITION CORP.

                                   By /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name   Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076







                                      -49-
<PAGE>   57



                                   SCOTTSDALE EDUCATIONAL CENTER FOR
                                   ALLIED HEALTH CAREERS, INCORPORATED

                                   By /s/ Vince Pisano
                                      ----------------------------------------

                                   Typed Name   Vince Pisano
                                              --------------------------------

                                   Title Vice President and Chief Financial
                                         -------------------------------------
                                         Officer
                                         -------------------------------------

                                   Attest  /s/ Morris C. Brown
                                         -------------------------------------

                                   Typed Name Morris C. Brown
                                              --------------------------------
                                   Title Secretary
                                         -------------------------------------

                                   Chief executive office:

                                   1327 Northmeadow Parkway
                                   Suite 132
                                   Roswell, Georgia 30076







                                      -50-
<PAGE>   58



                                  SCHEDULE 8.1

                                 [SUBSIDIARIES]

       Dest Education Corporation is a subsidiary of Andon Colleges, Inc.

























                                      -51-
<PAGE>   59



                                      
                                 SCHEDULE 9.9

                                   [LIENS]

                                [See attached]

























                                     -52-