EXHIBIT 10.18
FIRST AMENDMENT TO TRADE NAME
AND SERVICE ▇▇▇▇ LICENSE AGREEMENT
This First Amendment to Trade Name and Service ▇▇▇▇ License Agreement
(this "Amendment") is entered into as of February 1, 1999, by and between ITT
Sheraton Corporation, a Delaware corporation ("Licensor"), and ITT
Educational Services, Inc., a Delaware corporation ("Licensee") (individually
a "Party" and collectively, "Parties").
WHEREAS Licensor and Licensee are parties to a Trade Name and Service
▇▇▇▇ License Agreement dated June 3, 1998 (the "License");
WHEREAS ITT Corporation, a Nevada corporation ("Parent") owns all of the
outstanding shares of Licensor; and
WHEREAS Parent and Licensee entered into a Stock Repurchase Agreement,
dated as of December 18, 1998 (the "Repurchase Agreement"), pursuant to which,
among other things, Parent agreed to cause Licensor to amend the License as set
forth below.
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parties agree as follows:
I. DEFINITIONS
A. GENERALLY. Except as otherwise specified in this Amendment, all
capitalized terms in this Amendment shall have the meanings provided
in the License.
B. AMENDMENT EFFECTIVE DATE. "Amendment Effective Date" means the
date of the closing of the Repurchase and the Public Offering (as
those terms are defined in the Repurchase Agreement).
C. CHANGE OF CONTROL. As of the Amendment Effective Date, Section
I.F(iii) of the License is amended and restated to read in its
entirety as follows:
"(iii) the stockholders of Licensee shall approve (a) any
consolidation or merger of Licensee in which Licensee is not
the continuing or surviving corporation or pursuant to which
all shares of Common Stock would be converted into cash,
securities or other property, other than a merger of
Licensee in which holders of Common Stock immediately prior
to the merger have the same proportionate ownership of
common stock of the surviving corporation immediately after
the merger as immediately before, or (b) any sale, lease,
exchange or other transfer (in one transaction or a series
of related transactions) of all or substantially all of the
assets of
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Licensee to any person or entity other than a wholly-owned
subsidiary of Licensee."
II. SCOPE OF LICENSE
A. As of the Amendment Effective Date, Section II.A of the License shall
be amended and restated to read in its entirety as follows:
"▇. ▇▇▇▇▇. Subject to the terms and conditions of this
Agreement, Licensor hereby grants to Licensee, during the
term of this Agreement, a nonexclusive, non-transferable,
worldwide, royalty-free license to use the Licensed ▇▇▇▇ in
accordance with the applicable Permitted Manner of Use
solely in connection with the operation of the Business of
the Licensee and solely in the following manner:
"(1) in its corporate name, in its popular name and in the
name of its schools in and only in the manner specified
on Exhibit B attached hereto, as such Exhibit may be
supplemented from time to time pursuant to Section II.E
hereof; and
"(2) as a trademark and service ▇▇▇▇ for the purpose of
conducting the Business of Licensee."
B. As of the Amendment Effective Date, Section II.B of the
License shall be amended and restated to read in its
entirety as follows:
"B. SUBLICENSING, ASSIGNING AND TRANSFERRING. Licensee
shall not sublicense, sell, assign, share or otherwise
transfer any of its rights under this Agreement to any
other person or entity, and any attempted sublicense,
sale, assignment, or other transfer in violation of
this Agreement shall be null and void and shall
immediately terminate this Agreement and the license
granted herein. Notwithstanding the foregoing, Licensee
may sublicense its rights hereunder to any of its
current or future Subsidiaries and may assign or
transfer this Agreement to and among Licensee and any
of its current or future wholly-owned subsidiaries,
conditioned in each case upon and so long as: (i) any
and all sublicensees, assignees or transferees execute
a written agreement agreeing to be bound by the terms
of this Agreement; (ii) Licensee guarantees that the
performance of any and all such sublicensees, assignees
or transferees shall be in compliance with the terms of
this Agreement, and (iii) such sublicensee continues to
be a Subsidiary of Licensee or such assignee or
transferee continues to be a wholly-owned subsidiary of
Licensee."
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C. As of the Amendment Effective Date, Section II.E shall be added
to the License, as follows:
"E. ADDITIONAL USES.
"1. If Licensee desires to add names to Exhibit B
attached hereto for use solely in connection with
acquisitions within the Business of Licensee by
Licensee after January 1, 1999, Licensee may so
notify Licensor in writing, which notice shall
state: "By this notice, ITT Educational Services,
Inc. proposes to amend the Trade Name and Service
▇▇▇▇ License Agreement dated June 3, 1998, by and
between ITT Educational Services, Inc. and ITT
Sheraton Corporation, as amended, solely by adding
the following names to Exhibit B of such license
for use under such license agreement solely in
connection with acquisitions by ITT Educational
Services, Inc. after January 1, 1999 within its
business (as conducted as of June, 1998, and
generally described in its Annual Report on Form
10-K for the year ending December 31, 1997): [list
additional proposed names]."
"2. If Licensor does not respond to such notice by
either accepting or rejecting the additional names
proposed within thirty (30) days after it receives
such notice, Licensee may give a second notice
regarding such names not less than thirty (30)
days nor more than sixty (60) days after giving
the initial notice, which second notice shall be
identical to the initial notice except for its
date and except that it shall prominently state:
"THIS IS YOUR SECOND NOTICE. YOUR FAILURE TO
ACCEPT OR REJECT IN WRITING THE PROPOSAL TO ADD
THE NAMES SPECIFIED HEREIN TO EXHIBIT B OF THE
LICENSE AGREEMENT REFERENCED HEREIN WITHIN TEN
(10) DAYS AFTER RECEIPT OF THIS SECOND NOTICE MAY
BE DEEMED TO CONSTITUTE ACCEPTANCE OF SUCH
PROPOSAL. "
"3. Licensor may elect in the exercise of its sole and
absolute discretion whether to accept or reject
any proposal to add names to Exhibit B; provided
that Licensor shall be deemed to accept any such
proposal if (i) Licensee sends an initial notice
conforming in all respects to this Section II.E
making such proposal, (ii) not less than thirty
(30) nor more than sixty (60) days thereafter it
sends a second notice conforming in all respects
to this Section II.E repeating such proposal, and
(iii) Licensor nevertheless fails to accept or
reject such proposal in writing within ten (10)
days after it receives such second notice."
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"4. Copies of all notices to Licensor under this
Section II.E shall be given or delivered in a
manner specified in Section XII.B hereof
concurrently with the giving of such notice to
Licensor at the following address:
c/o Starwood Hotels and Resorts Worldwide, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
with a copy (which shall not constitute notice) to:
Sidley & Austin
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other or additional addresses as
Licensor shall specify in writing. Notice to
Licensor under this Section II.E shall be of no
force or effect unless it and all required copies
(i) are given or delivered in conformity with
Section XII.B hereof, (ii) comply with all
requirements of this Section II.E, and (iii) are
actually received by Starwood Hotels and Resorts
Worldwide, Inc., or its successor. Notice to
Licensee under this Section II.E shall be
effective if it is provided in accordance with
Section XII.B hereof or if it is actually received
by Licensee."
D. EXHIBIT B
As of the Amendment Effective Date, Exhibit B shall be added to the License in
the form attached hereto.
III. TERM OF LICENSE
As of the Amendment Effective Date, Section III.A of the License shall be
amended and restated to read in its entirety as follows:
"A. TERM. This Agreement shall continue in full force and effect in
perpetuity unless it is terminated as provided herein."
IV. TERMINATION
Either party may terminate this Amendment upon written notice to the
other party if the Amendment Effective Date does not occur on or
before March 31, 1999. This Amendment shall be of no force or effect
whatsoever if it terminates before the Amendment Effective Date;
provided that Section V of this Amendment shall be fully
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effective whether or not the Amendment Effective Date occurs and shall
survive any termination of this Amendment and remain fully effective
thereafter in perpetuity.
V. NO OTHER AMENDMENT
This Amendment sets forth the Parties' entire understanding and
agreement regarding amendments to the License and supersedes all prior
or contemporaneous communications regarding such amendments, all of
which are merged herein. Without limiting the generality of the
foregoing, Licensee agrees for the benefit of both Licensor and Parent
that Licensee has no right to demand or require amendment of the
License under the Repurchase Agreement except as specifically and
expressly provided herein. Subject to this Amendment, the License
remains in full force and effect.
VI. COUNTERPARTS
This Amendment may be executed in counterparts, each of which shall be
deemed an original and all of which together shall constitute one and
the same instrument.
IN WITNESS WHEREOF, the Parties have executed this Amendment as of the date
first above written.
ITT SHERATON CORPORATION ITT EDUCATIONAL SERVICES, INC.
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: Senior Vice President Title: Senior Vice President
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EXHIBIT B
ITT Educational Services, Inc.
ITT Educational Services
ITT Technical Institute
ITT Technical Institutes
ITT Tech
ITT Technical College
ITT College of Technology
ITT College
ITT Technical University
ITT University
ITT Adult Learning Corp.
ITT Distance Education Corp.
ITT Distance Learning Corp.
ITT Educational Services Foundation
ITT Graduate Division
ITT Graduate School
ITT Technical Institute Alumni Association
ITT Tech Alumni Association
ITT Scholarship Program
ITT Student Finance Corporation
ITT ESI PAC
ITT Tech PAC
ITT Technical Institute Foundation
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