EXHIBIT 10.1

EXECUTION VERSION

 
FIRST AMENDMENT TO CREDIT AGREEMENT
 
This First Amendment to Credit Agreement (this “First Amendment”) is entered
into as of March 31, 2014 by and among ITT EDUCATIONAL SERVICES, INC., a
Delaware corporation (the “Borrower”), the Lenders party hereto, and JPMORGAN
CHASE BANK, N.A., as administrative agent (the “Administrative Agent”).
 
 
RECITALS
 
A.           The Borrower, the financial institutions from time to time party
thereto as lenders (the “Lenders”) and Administrative Agent are party to that
certain Credit Agreement dated as of March 21, 2012 (the “Credit
Agreement”).  Unless otherwise specified herein, capitalized terms used in this
First Amendment shall have the meanings ascribed to them by the Credit
Agreement.
 
B.           The Borrower has requested that the Lenders and the Administrative
Agent amend certain provisions of the Credit Agreement on the terms and
conditions set forth below.
 
Now, therefore, in consideration of the mutual execution hereof and other good
and valuable consideration, the parties hereto agree as follows:
 
1. Amendment – Section 5.01(a) and 5.01(c).  Notwithstanding anything to the
contrary in Sections 5.01(a) or 5.01(c) of the Credit Agreement, the audited
consolidated balance sheet and related statements of operations, stockholders'
equity and cash flows described in Section 5.01(a) of the Credit Agreement, and
the certificate of a Financial Officer of the Borrower as described in
Section 5.01(c) of the Credit Agreement, in each case, as of and for the fiscal
year ending December 31, 2013, required to be furnished by the Borrower to the
Administrative Agent and each Lender pursuant to Sections 5.01(a) and 5.01(c) of
the Credit Agreement, are required to be furnished by June 30, 2014 and Sections
5.01(a) and 5.01(c) of the Credit Agreement are so amended.
 
2. Amendment – Section 5.01(b) and 5.01(c).  Notwithstanding anything to the
contrary in Sections 5.01(b) or 5.01(c) of the Credit Agreement, the internally
prepared consolidated balance sheet and related statements of operations,
stockholders' equity and cash flows described in Section 5.01(b) of the Credit
Agreement, and the certificate of a Financial Officer of the Borrower as
described in Section 5.01(c) of the Credit Agreement, in each case, as of and
for the fiscal quarter ending March 31, 2014, required to be furnished by the
Borrower to the Administrative Agent and each Lender pursuant to
Sections 5.01(b) and 5.01(c), are required to be furnished by June 30, 2014, and
Sections 5.01(b) and 5.01(c) of the Credit Agreement are so amended.
 
3. Amendment  -- Section 6.12(a).  Section 6.12(a) of the Credit Agreement shall
be amended and restated in its entirety to read as follows, effective as of
December 30, 2013:
 
 
CHI:2810024.8

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(a) Maximum Leverage Ratio.  The Borrower will not permit the Leverage Ratio as
of the end of any fiscal quarter of the Borrower other than the Fiscal Quarters
ending on December 31, 2013 and March 31, 2014 to be greater than 1.50 to 1.00.
 
4. Availability Limitation.  Until such time as the Borrower delivers a
certificate pursuant to Section 5.01(c) of the Credit Agreement demonstrating
compliance with Section 6.12 of the Credit Agreement (without giving effect to
this First Amendment), Availability (as defined below) shall not be less than
$200,000,000.  “Availability” means, at any time, the aggregate amount of the
Lenders’ Commitments minus the Revolving Credit Exposure (calculated, with
respect to any Defaulting Lender, as if such Defaulting Lender had funded its
Applicable Percentage of all outstanding Borrowings).
 
5. Representations and Warranties of the Borrower.  The Borrower represents and
warrants that:
 
(a) This First Amendment has been duly executed and delivered by the Borrower
and constitutes a legal, valid and binding obligation of the Borrower,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.
 
(b) After giving effect to this First Amendment, each of the representations and
warranties of the Credit Parties set forth in the Credit Documents are true and
correct in all material respects (except that any such representation or
warranty which is already qualified as to materiality or by reference to
Material Adverse Effect are true and correct in all respects) on and as of the
date hereof, other than any such representations and warranties that
specifically refer to an earlier date, in which case they shall be true and
correct as of such earlier date in all material respects (except that any such
representation or warranty which is already qualified as to materiality or by
reference to Material Adverse Effect shall be true and correct in all respects).
 
(c) After giving effect to this First Amendment, no Default has occurred and is
continuing.
 
6. Effectiveness.  This First Amendment shall become effective upon:
 
(a) the execution and delivery hereof by the Borrower, the Required Lenders and
the Administrative Agent; and
 
(b) receipt by the Administrative Agent of an amendment fee for the benefit of
the Lenders party hereto in an amount equal to $7,500 for each such Lender.
 
5.           Reference to and Effect Upon the Credit Agreement.
 
(a)           Except as specifically set forth above, the Credit Agreement shall
remain in full force and effect and is hereby ratified and confirmed.
 
 
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(b)           The execution, delivery and effectiveness of this First Amendment
shall not operate as a waiver of any right, power or remedy of the Agent or any
Lender under the Credit Agreement, nor constitute a waiver of any provision of
the Credit Agreement, except as specifically set forth herein.  Upon the
effectiveness of this First Amendment, each reference in the Credit Agreement to
“this Agreement”, “hereunder”, “hereof”, “herein” or words of similar import
shall mean and be a reference to the Credit Agreement as amended hereby.
 
(c)           This First Amendment shall constitute a Credit Document.
 
6.           Costs and Expenses.  The Borrower hereby affirms its obligation
under Section 9.03 of the Credit Agreement to pay all reasonable out-of-pocket
expenses incurred by the Administrative Agent and its Affiliates, including the
reasonable fees, charges and disbursements of counsel for the Administrative
Agent, in connection with the preparation and administration of this First
Amendment (whether or not the transactions contemplated hereby shall be
consummated).
 
7.           Governing Law.  This First Amendment shall be construed in
accordance with and governed by the law of the State of New York.
 
8.           Headings.  Section headings in this First Amendment are included
herein for convenience of reference only and shall not constitute a part of this
First Amendment for any other purposes.
 
9.           Counterparts.  This First Amendment may be executed in any number
of counterparts, each of which when so executed shall be deemed an original but
all such counterparts shall constitute one and the same instrument.  Delivery of
an executed counterpart of a signature page of this First Amendment by email or
any other electronic means that reproduces an image of the actual executed
signature page shall be effective as delivery of a manually executed counterpart
of this First Amendment.
 
[signature pages follow]
 

 
 
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IN WITNESS WHEREOF, the parties have executed this First Amendment as of the
date and year first above written.
 
ITT EDUCATIONAL SERVICES, INC.
 
 
By:   /s/ Kevin M. Modany
Name: Kevin M. Modany
Title: Chairman, CEO
 

[Signature Page to ITT First Amendment]
 
 

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JPMORGAN CHASE BANK, N.A.,
as a Lender and as the Administrative Agent
 

 
 
By:   /s/ Richard Barritt
Name: Richard Barritt
Title: Associate
 

[Signature Page to ITT First Amendment]
 
 

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BANK OF AMERICA, N.A., as a Lender

 
 
By:   /s/ Jonathan M. Phillips
Name: Jonathan M. Phillips
Title: Senior Vice President
 

[Signature Page to ITT First Amendment]
 
 

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Regions Bank, as a Lender

 
 
By:   /s/ Eric Harvey
Name: Eric Harvey
Title: Vice President
 

[Signature Page to ITT First Amendment]
 
 

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Associated Bank, National Association, as a Lender

 
 
By:   /s/ Jennifer Teubl
Name: Jennfer Teubl
Title: Vice President
 

[Signature Page to ITT First Amendment]
 
 

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[other Lenders], as a Lender – Fifth Third Bank

 
 
By:   /s/ Paul D. Burch
Name: Paul D. Burch
Title: Vice President
          Fifth Third Bank, Central Indiana
 

[Signature Page to ITT First Amendment]
 
 

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The Northern Trust Company, as a Lender

 
 
By:   /s/ Michael Fornal
Name: Michael Fornal
Title: Vice President
 

[Signature Page to ITT First Amendment]
 
 

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KeyBank, NA, as a Lender

 
 
By:   /s/ Georgianna S. Jackson
Georgianna S. Jackson
Vice President
 

 

[Signature Page to ITT First Amendment]