1
EXHIBIT 10.4
ASSUMPTION AGREEMENT
ASSUMPTION AGREEMENT made as of December 31, 1996 between O/E LEARNING,
INC., a Michigan corporation ("Seller"), with a registered office at 0000 Xxxx
Xxx Xxxxxx, Xxxxx 000, Xxxx, Xxxxxxxx 00000 and HBC ACQUISITION CORP., a
Delaware corporation ("Buyer"), with a registered office at 0000 Xxxxxxxxxxx
Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxx 00000.
Preliminary Statement
Seller, Buyer, and Educational Medical, Inc., which is the parent
corporation of the Buyer, have entered into an Asset Purchase Agreement dated as
of December 12, 1996 (the "Asset Purchase Agreement") pursuant to which, among
other things, Buyer has agreed to assume certain stated liabilities and
obligations of Seller relating to the operation of the School. All of the
capitalized terms in this Assumption Agreement shall have the meaning given to
them in the Asset Purchase Agreement unless the context clearly demands
otherwise.
NOW THEREFORE, in consideration of the agreements set forth herein and
in the Asset Purchase Agreement, and other good and valuable consideration, the
receipt and adequacy of which are hereby conclusively acknowledged by Buyer, and
to induce Seller to consummate the transactions contemplated by the Asset
Purchase Agreement, and intending to be legally bound hereby Buyer agrees as
follows:
1. Assumption Obligation. Buyer hereby assumes and undertakes to
perform, pay, satisfy, and discharge each of the Stated Liabilities.
The Buyer shall perform, pay, satisfy, and discharge, as the
case may be, each of the Stated Liabilities at or before such time as payment or
performance thereunder is due.
2. Right to Contest. Buyer may contest, in good faith, its
obligation to perform or pay Stated Liabilities in the event and to the extent
Buyer reasonably believes that such payment or performance is not due to the
creditor or other party claiming entitlement to payment or performance. In the
event that Buyer contests its obligation to pay or perform any of the Stated
Liabilities, (a) Buyer shall promptly notify Seller of the Stated Liability
being contested, and the reasons therefor, and (b) regardless of whether such
notice is given, Buyer shall, at its cost and expense, protect, defend,
indemnify and hold harmless Seller from, against and in respect of any cost,
expense (including reasonable attorneys' fees and costs), liability, obligation
or claim asserted against, incurred by or imposed upon Seller arising from, or
in connection with or related to Buyer's contest of any Stated Liabilities.
3. Costs of Enforcement. In connection with any action arising
from or in connection with the enforcement of this Agreement, the prevailing
party shall be
2
entitled to an award of its expenses, including reasonable attorneys' fees and
disbursements, incurred or paid in any proceeding which may be instituted.
4. Jury Trial Waiver. BUYER KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS AGREEMENT, OR THE
TRANSACTIONS OR OBLIGATIONS CONTEMPLATED IN THIS AGREEMENT, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER ORAL OR WRITTEN) OR ACTIONS OF
ANY PARTY RELATING TO THIS AGREEMENT. BUYER CERTIFIES THAT NO REPRESENTATIVE OR
AGENT OF SELLER, NOR SELLER'S COUNSEL, HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT IT WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER
OF RIGHT TO JURY TRIAL PROVISION.
5. Modifications; Waivers Remedies Cumulative. No amendment,
modification, waiver or discharge of this Agreement, or any provision hereof,
shall be valid or effective unless in writing and signed by Seller and Buyer. No
delay or omission of Seller to exercise any right, power or remedy accruing
under or pursuant to this Agreement, at law, in equity, or otherwise, shall
exhaust or impair any right, power or remedy or shall be construed to waive any
such right, power or remedy. Every right, power and remedy of Seller created
under this Agreement may be exercised from time to time and as often as may be
deemed expedient by Seller in its sole discretion. No right, power or remedy
conferred upon or reserved to Seller is exclusive of any other right, power or
remedy, but each and every such right, power and remedy shall be cumulative and
concurrent and shall be in addition to any other right, power and remedy given
under this Agreement or under any other instrument executed in connection
herewith (including, without limitation, the Asset Purchase Agreement), or now
or hereafter existing at law, in equity, or otherwise. No obligation of Buyer
under this Agreement shall be deemed waived by any course or pattern of conduct
by any party.
6. Severability. The provisions of this Agreement shall be
severable. In the event that a court of competent jurisdiction determines that
any provision of this Agreement is invalid or unenforceable, and is not
reformed by such court, such invalid or unenforceable provision shall not
affect or impair the validity or enforceability of any other provision of this
Agreement and this Agreement shall be construed as if the invalid or
unenforceable provision had not been included in this Agreement.
7. Captions. The captions used in this Agreement are for
convenience of reference only and shall not be construed to extend, limit or
modify the scope of meaning of the respective paragraphs to which they relate.
-2-
3
8. Enforceability; Successors and Assigns. This Agreement shall be
binding upon Buyer and Buyer's successors and assigns and shall inure to the
benefit of Seller and its successors and assigns.
IN WITNESS WHEREOF, Buyer has executed and delivered this Agreement on
the date first above written.
HBC ACQUISITION CORP., a Delaware
corporation
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Authorized Signatory
Educational Medical, Inc., a Delaware corporation, joins in this Agreement for
the purpose of confirming that it is jointly and severally obligated with HBC
Acquisition Corp. pursuant to the terms of this Assumption Agreement.
EDUCATIONAL MEDICAL, INC., a
Delaware corporation
By: /s/ Xxxxxx X. Xxxxx
-----------------------------
Authorized Signatory
-3-
