Exhibit 10.1

EXECUTION COPY

LIMITED WAIVER
 
LIMITED WAIVER, dated as of August 17, 2016 (this "Waiver"), to the Financing
Agreement, dated as of December 4, 2014 (as amended, restated, supplemented or
otherwise modified from time to time, the "Financing Agreement"), by and among
ITT Educational Services, Inc. (the "Parent" or the "Borrower"), each subsidiary
of the Parent listed as a "Guarantor" on the signature pages thereto (together
with each other Person that executes a joinder agreement and becomes a
"Guarantor" thereunder or otherwise guaranties all or any part of the
Obligations (as defined therein), each a "Guarantor" and collectively, the
"Guarantors"), the lenders from time to time party thereto (each a "Lender" and
collectively, the "Lenders"), Cerberus Business Finance, LLC ("Cerberus"), as
collateral agent for the Lenders (in such capacity, together with its successors
and assigns in such capacity, the "Collateral Agent"), and Cerberus, as
administrative agent for the Lenders (in such capacity, together with its
successors and assigns in such capacity, the "Administrative Agent" and together
with the Collateral Agent, each an "Agent" and collectively, the "Agents").
 
WHEREAS, the Loan Parties have informed the Agents and the Lenders that the
Parent entered into a Standard Offer, Agreement and Escrow Instructions for
Purchase of Real Estate, dated as of August 11, 2016 (the “Purchase Agreement”;
the transactions contemplated thereby, the “Transactions”), with New River
Development, LLC, a copy of which has been furnished to the Agents on or prior
to the date hereof;
 
WHEREAS, the Loan Parties have requested that the Agents and the Lenders waive
compliance with certain provisions of the Financing Agreement and other Loan
Documents in connection with the Borrower’s execution of the Purchase Agreement
and the consummation of the Transactions; and
 
WHEREAS, the Agents and the Lenders are willing to waive compliance with such
provisions on the terms and conditions set forth herein.
 
NOW THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
 
1. Definitions.  All terms used herein that are defined in the Financing
Agreement and not otherwise defined herein shall have the meanings assigned to
them in the Financing Agreement.
 
2. Limited Waiver.
 
(a) As of the Effective Date, the Agents and the Lenders hereby waive compliance
with the provisions of the Financing Agreement and each other Loan Document
solely to the extent necessary to permit Parent’s execution of the Purchase
Agreement and consummation of the Transactions, so long as the Loan Parties
prepay the outstanding principal amount of the Loans in an amount equal to 100%
of the Net Cash Proceeds received by the Loan Parties in connection with the
Transactions in accordance with Section 2.05(b)(ii) of the Financing Agreement.
 
 

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(b) The waivers in this Section 2 shall be effective only in this specific
instance and for the specific purposes set forth herein and do not allow for any
other or further departure from the terms and conditions of the Financing
Agreement or any other Loan Document, which terms and conditions shall continue
in full force and effect.
 
3. Conditions to Effectiveness.  This Waiver shall become effective only upon
satisfaction in full, in a manner satisfactory to the Agents, of the following
conditions precedent (the first date upon which all such conditions shall have
been satisfied being hereinafter referred to as the "Effective Date"):
 
(a) Except for such representations and warranties that are not true and correct
as a result of the items waived in Section 2 of this Waiver, if any, the
representations and warranties contained in Article VI of the Financing
Agreement and in each other Loan Document shall be true and correct in all
material respects (except that such materiality qualifier shall not be
applicable to any representations or warranties that already are qualified or
modified as to "materiality" or "Material Adverse Effect" in the text thereof,
which representations and warranties shall be true and correct in all respects
subject to such qualification) on and as of the Effective Date as though made on
and as of such date, except to the extent that any such representation or
warranty expressly relates solely to an earlier date (in which case such
representation or warranty shall be true and correct (except for such
representations and warranties that are not true and correct as a result of the
items waived in Section 2 of this Waiver, if any) in all material respects
(except that such materiality qualifier shall not be applicable to any
representations or warranties that already are qualified or modified as to
"materiality" or "Material Adverse Effect" in the text thereof, which
representations and warranties shall be true and correct in all respects subject
to such qualification) on and as of such earlier date).
 
(b) After giving effect to this Waiver, no Default or Event of Default shall
have occurred and be continuing on the Effective Date or result from this Waiver
becoming effective in accordance with its terms.
 
(c) The Collateral Agent shall have received on or before the Effective Date
this Waiver, duly executed by the Loan Parties, each Agent and the Required
Lenders.
 
4. Continued Effectiveness of the Financing Agreement and Other Loan
Documents.  Each Loan Party hereby (a) confirms and agrees that the Financing
Agreement and each other Loan Document to which it is a party is, and shall
continue to be, in full force and effect and is hereby ratified and confirmed in
all respects, except that on and after the Effective Date, all references in any
such Loan Document to "the Financing Agreement", the "Agreement", "thereto",
"thereof", "thereunder" or words of like import referring to the Financing
Agreement shall mean the Financing Agreement as amended by this Waiver, and
(b) confirms and agrees that, to the extent that any such Loan Document purports
to assign or pledge to the Collateral Agent, for the benefit of the Agents and
the Lenders, or to grant to the Collateral Agent, for the benefit of the Agents
and the Lenders, a security interest in or Lien on any Collateral as security
for the Obligations of the Loan Parties from time to time existing in respect of
the Financing Agreement (as amended hereby) and the other Loan Documents, such
pledge, assignment and/or grant of the security interest or Lien is hereby
ratified and confirmed in all respects.  This Waiver does not and shall not
affect any of the obligations of the Loan Parties, other than as expressly
provided herein, including, without limitation, the Loan Parties' obligations to
repay the Loans in accordance with the terms of Financing Agreement or the
obligations of the Loan Parties under any Loan Document to which they are a
party, all of which obligations shall remain in full force and effect.  Except
as expressly provided herein, the execution, delivery and effectiveness of this
Waiver shall not operate as a waiver of any right, power or remedy of any Agent
or any Lender under the Financing Agreement or any other Loan Document nor
constitute a waiver of any provision of the Financing Agreement or any other
Loan Document.
 
 
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5. No Novation.  Nothing herein contained shall be construed as a substitution
or novation of the Obligations outstanding under the Financing Agreement or
instruments securing the same, which shall remain in full force and effect,
except as modified hereby.
 
6. No Representations by Agents or Lenders.  Each Loan Party hereby acknowledges
that it has not relied on any representation, written or oral, express or
implied, by any Agent or any Lender, other than those expressly contained
herein, in entering into this Waiver.
 
7. Release.  Each Loan Party hereby acknowledges and agrees that:  (a) neither
it nor any of its Subsidiaries has any claim or cause of action against any
Agent or any Lender (or any of the directors, officers, employees, agents,
attorneys or consultants of any of the foregoing) and (b) the Agents and the
Lenders have heretofore properly performed and satisfied in a timely manner all
of their obligations to the Loan Parties, and all of their Subsidiaries and
Affiliates.  Notwithstanding the foregoing, the Agents and the Lenders wish (and
the Loan Parties agree) to eliminate any possibility that any past conditions,
acts, omissions, events or circumstances would impair or otherwise adversely
affect any of their rights, interests, security and/or remedies.  Accordingly,
for and in consideration of the agreements contained in this Waiver and other
good and valuable consideration, each Loan Party (for itself and its
Subsidiaries and Affiliates and the successors, assigns, heirs and
representatives of each of the foregoing) (collectively, the "Releasors") does
hereby fully, finally, unconditionally and irrevocably release, waive and
forever discharge the Agents and the Lenders, together with their respective
Affiliates and Related Funds, and each of the directors, officers, employees,
agents, attorneys and consultants of each of the foregoing (collectively, the
"Released Parties"), from any and all debts, claims, allegations, obligations,
damages, costs, attorneys' fees, suits, demands, liabilities, actions,
proceedings and causes of action, in each case, whether known or unknown,
contingent or fixed, direct or indirect, and of whatever nature or description,
and whether in law or in equity, under contract, tort, statute or otherwise,
which any Releasor has heretofore had or now or hereafter can, shall or may have
against any Released Party by reason of any act, omission or thing whatsoever
done or omitted to be done, in each case, on or prior to the Effective Date
directly arising out of, connected with or related to this Waiver, the Financing
Agreement or any other Loan Document, or any act, event or transaction related
or attendant thereto, or the agreements of any Agent or any Lender contained
therein, or the possession, use, operation or control of any of the assets of
any Loan Party, or the making of any Loans or other advances, or the management
of such Loans or other advances or the Collateral.  Each Loan Party represents
and warrants that it has no knowledge of any claim by any Releasor against any
Released Party or of any facts or acts or omissions of any Released Party which
on the date hereof would be the basis of a claim by any Releasor against any
Released Party which would not be released hereby.
 
 
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8. Miscellaneous.
 
(a) This Waiver may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which shall be deemed to be an
original but all of which taken together shall constitute one and the same
agreement.  Delivery of an executed counterpart of this Waiver by facsimile or
electronic mail shall be equally effective as delivery of an original executed
counterpart of this Waiver.
 
(b) Section and paragraph headings herein are included for convenience of
reference only and shall not constitute a part of this Waiver for any other
purpose.
 
(c) This Waiver shall be governed by, and construed in accordance with, the laws
of the State of New York.
 
(d) Each Loan Party hereby acknowledges and agrees that this Waiver constitutes
a "Loan Document" under the Financing Agreement.
 
(e) Any provision of this Waiver that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining portions
hereof or affecting the validity or enforceability of such provision in any
other jurisdiction.
 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Waiver to be executed
and delivered as of the date set forth on the first page hereof.
 

 
BORROWER:
     
ITT EDUCATIONAL SERVICES, INC.
         
By:
/s/ Rocco F. Tarasi, III
   
Name: Rocco F. Tarasi, III
   
Title: EVP & Chief Financial Officer
   

 
GUARANTORS:
     
ESI SERVICE CORP.
         
By:
/s/ Rocco F. Tarasi, III
   
Name: Rocco F. Tarasi, III
   
Title: VP & Treasurer
   

     
DANIEL WEBSTER COLLEGE, INC.
         
By:
/s/ Angela K. Knowlton
   
Name: Angela K. Knowlton
   
Title: VP, Treasurer

 
Limited Waiver
 

 
 

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COLLATERAL AGENT:
     
CERBERUS BUSINESS FINANCE, LLC
         
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Executive Vice President
       

 
ADMINISTRATIVE AGENT:
     
CERBERUS BUSINESS FINANCE, LLC
         
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Executive Vice President
           

 
Limited Waiver
 

 
 

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LENDERS:
   

 
CERBERUS ASRS FUNDING LLC
     
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Vice President
   

 
CERBERUS AUS LEVERED II LP
By: CAL II GP LLC,
its General Partner
     
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Vice President
   

 
CERBERUS ICQ LEVERED II LLC
         
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Vice President

 
CERBERUS ICQ LEVERED LLC
     
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Vice President
   

 

 
Limited Waiver

 
 

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CERBERUS KRS LEVERED LLC
     
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Vice President
   

 

 
CERBERUS N-1 FUNDING LLC
     
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Vice President
   

 
Limited Waiver

 
 

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CERBERUS OFFSHORE LEVERED II LP
 
By: COL II GP Inc.,
 
its General Partner
     
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Vice President

 
CERBERUS ONSHORE LEVERED II LLC
         
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Vice President

 
CERBERUS SWC LEVERED II LLC
By: Cerberus SL GP LLC,
its General Partner
     
By:
/s/ Eric F. Miller
   
Name: Eric F. Miller
   
Title: Vice President
   

 

 
Limited Waiver