News Releases

ITT Educational Services, Inc. Announces Resignation of Waddles as President

Jul 12, 2004

ITT Educational Services Inc. (NYSE: ESI) today announced that Omer E. Waddles, president and chief operating officer, is resigning his employment effective July 30, 2004. Waddles is resigning from his officer and director positions effective July 20, 2004.

Rene R. Champagne, chairman and chief executive officer, will assume the responsibilities of president and chief operating officer. The company said Waddles is assisting in the transition and that it will begin a search for a successor, considering both internal and external candidates.

"Omer made important contributions to the growth of ITT Educational Services," said Champagne. "He enhanced the advancement of our mission to provide a quality education and to help students achieve their educational goals. We wish him the best in his future endeavors."

The company emphasized that Waddles' resignation is unrelated to any of the matters in the ongoing government investigation of the company.

Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Forward-looking statements are made based upon the current expectations and beliefs of the company's management concerning future developments and their potential effect on the company. There can be no assurance that future developments affecting the company will be those anticipated by its management. These forward- looking statements involve a number of risks and uncertainties. Among the factors that could cause actual results to differ materially are the following: business conditions and growth in the postsecondary education industry and in the general economy; changes in federal and state governmental regulations with respect to education and accreditation standards, or the interpretation or enforcement thereof, including, but not limited to, the level of government funding for, and the company's eligibility to participate in, student financial aid programs utilized by the company's students; the results of the qui tam action brought under the False Claims Act, 31 U.S.C. Section 3730, in which the company is a defendant which, if adversely determined, could result in a demand for repayment of federal student financial aid funds, trebled under the False Claims Act, and penalties; effects of any change in ownership of the company resulting in a change in control of the company, including, but not limited to, the consequences of such changes on the accreditation and federal and state regulation of the institutes; the company's ability to implement its growth strategies; receptivity of students and employers to the company's existing program offerings and new curricula; loss of lender access to the company's students for student loans; the effects of the federal grand jury investigation of the company which could result in monetary fines or penalties or other sanctions imposed on the company (including the company's loss of eligibility to participate in student financial aid programs) that could materially adversely affect the company's financial condition and operations; the results of the Securities and Exchange Commission's inquiry into the allegations being investigated by the federal grand jury which could result in the restatement of the company's financial statements, monetary fines or penalties or other sanctions that could materially adversely affect the company's financial condition and operations; the results of the securities class action and shareholder derivative lawsuits filed against the company which, if adversely determined, could have a material adverse effect on the company's financial condition and results of operations; and other risks and uncertainties detailed from time to time in the company's filings with the Securities and Exchange Commission. The company undertakes no obligation to update or revise any forward-looking information, whether as a result of new information, future developments or otherwise.

SOURCE: ITT Educational Services, Inc.

CONTACT: Mike Pascale of The Abernathy MacGregor Group, +1-212-371-5999,
for ITT Educational Services, Inc.

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