Exhibit 10.5

APOLLO GROUP METRICS

PERFORMANCE SHARE AWARD AGREEMENT

RECITALS

A.    The Corporation has implemented the Plan as an equity incentive program to
encourage key employees and officers of the Corporation and the non–employee
members of the Board to remain in the employ or service of the Corporation by
providing them with an opportunity to acquire a proprietary interest in the
success of the Corporation.

B.    Participant is to render valuable services to the Corporation (or any
Parent or Subsidiary), and this Agreement is executed pursuant to, and is
intended to carry out the purposes of, the Plan in connection with the
Corporation’s issuance of shares of Class A Common Stock to Participant under
the Plan.

C.    All capitalized terms in this Agreement shall have the meaning assigned to
them in the attached Appendix A.

NOW, THEREFORE, it is hereby agreed as follows:

1.    Grant of Performance Shares. The Corporation hereby awards to Participant,
as of the Award Date indicated below, an award (the “Award”) of Performance
Shares under the Plan. Each Performance Share which vests pursuant to the terms
of this Agreement shall provide Participant with the right to receive one or
more shares of Class A Common Stock on the designated issuance date. The number
of shares of Class A Common Stock subject to the awarded Performance Shares, the
applicable performance vesting requirements for the Performance Shares, the rate
at which the vested Performance Shares are to convert into shares of Class A
Common Stock, the date on which the converted shares of Class A Common Stock
shall become issuable and the remaining terms and conditions governing the
Award, including the applicable Service vesting requirements, shall be as set
forth in this Agreement.

Participant:
<NAME>
 
 
Award Date:
<AWARD_DATE>
 
 
Designated Number
    of 
Performance Shares:
The actual number of shares of Class A Common Stock that may become issuable
pursuant to the Performance Shares awarded under this Agreement shall be
determined in accordance with the Vesting Schedule below. For purposes of such
schedule, the designated number of Performance Shares to be utilized is
<SHARES> shares and shall constitute the “Target Number of Performance Shares”
for purposes of this Agreement.

Vesting Schedule:
The number of shares of Class A Common Stock which may actually vest and become
issuable pursuant to the Award shall be determined pursuant to a two–step
process: (i) first the maximum number of shares of Class A Common Stock in which
Participant can vest under the Performance Vesting section below shall be
calculated on an

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aggregate basis in accordance with the various levels at which the Performance
Goals are actually attained and (ii) then the aggregate number of shares
calculated under clause (i) in which Participant may actually vest shall be
determined on the basis of the number of years of Service the Participant
completes during the Service Period in accordance with the Service vesting
requirements set forth in Paragraph 3 of this Agreement.

Performance Vesting: ___________ percent (___%) of the Target Number of
Performance Shares is hereby allocated to Performance Goal I set forth in
attached Schedule I. ___________ percent (___%) of the Target Number of
Performance Shares is hereby allocated to Performance Goal II set forth in
attached Schedule II. The remaining __________ percent (__%) of the Target
Number of Performance Shares is hereby allocated to Performance Goal III set
forth in attached Schedule III. Within seventy–five (75) days after the
______________ completion date of the Corporation’s ____ fiscal year, the Plan
Administrator shall determine and certify the actual level of attainment for
each of the Performance Goals. On the basis of the certified level of attainment
for each such Performance Goal, the number of Performance Shares representing
the percentage of the Target Number of Performance Shares allocated to that
Performance Goal will be multiplied by the applicable conversion rate (which may
range from 0% to ____%) determined in accordance with the schedule of conversion
rates set forth in the attached Schedule pertaining to that particular
Performance Goal. The aggregate number of shares resulting from such
calculations shall constitute the maximum number of shares of Class A Common
Stock in which Participant may vest under this Award and shall be designated the
“Performance–Qualified Shares.” In no event may the aggregate number of such
Performance–Qualified Shares exceed ____% of the Target Number of Performance
Shares.

Should a particular Performance Goal be attained at a level below the threshold
level specified for that Performance Goal in the attached Schedule pertaining to
such goal, then the Target Number of Performance Shares allocated to that
Performance Goal shall be immediately cancelled. Participant shall thereupon
cease to have any further right, title or interest in the shares of Class A
Common Stock underlying those cancelled Performance Shares.

Service Vesting. The number of Performance–Qualified Shares in which Participant
actually vests shall be determined in accordance with the Service–vesting
provisions set forth in Paragraph 3 of this Agreement.

Change in Control Vesting. The shares of Class A Common Stock underlying the
Performance Shares subject to this Award may also vest on an accelerated basis
in accordance with Paragraph 5 should a Change in Control occur prior to the
scheduled ______________ completion date of the Corporation’s ____ fiscal year.

Issuance Date:
The shares of Class A Common Stock which actually vest and become issuable
pursuant to the terms of this Agreement shall be issued in accordance with the
provisions of this Agreement applicable to the particular circumstances under
which such vesting occurs.

2.    Limited Transferability. Prior to the actual issuance of the shares of
Class A Common Stock which vest hereunder, Participant may not transfer any
interest in the performance shares subject to the Award or the underlying shares
of Class A Common Stock or pledge or otherwise hedge the sale of those

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performance shares or the underlying shares of Class A Common Stock, including
(without limitation) any short sale or any acquisition or disposition of any put
or call option or other instrument tied to the value of the Class A Common
Stock. However, any shares of Class A Common Stock which vest hereunder but
otherwise remain unissued at the time of Participant’s death may be transferred
pursuant to the provisions of Participant’s will or the laws of inheritance or
to Participant’s designated beneficiary or beneficiaries of this Award.
Participant may make such a beneficiary designation at any time by filing the
appropriate form with the Plan Administrator or its designate.

3.    Service Requirement.

(a)    The number of Performance–Qualified Shares calculated in accordance with
the Performance–Vesting provisions of Paragraph 1 and attached Schedules __
through ___ represent the maximum number of shares of Class A Common Stock in
which Participant can vest hereunder. The actual number of shares of Class A
Common Stock in which Participant shall vest shall be determined by multiplying
that number of Performance–Qualified Shares by a fraction, the numerator of
which is the number of full fiscal years of Service completed by the Participant
within the Service Period and the denominator of which is the total number of
fiscal years within that Service Period.

(b)    ADD ANY SPECIAL SERVICE–VESTING PROVISIONS REQUIRED BY EXISTING
EMPLOYMENT AGREEMENT WITH PARTICIPANT

ALTERNATIVE

(b)    Should the Participant cease Service prior to the completion of a
particular fiscal year included within the Service Period by reason of an
Involuntary Termination and deliver an effective and enforceable general release
to the Corporation in accordance with the requirements of the Senior Executive
Severance Pay Plan, then following the completion of the Service Period and the
required certification of the number of Performance–Qualified Shares subject to
this Award, Participant shall, with respect to such partial fiscal year of
Service, vest in that additional number of shares of Class A Common Stock (if
any) determined by multiplying the certified number of Performance–Qualified
Shares by a fraction, the numerator of which is the number of months of Service
actually completed by the Participant during that particular fiscal year
(rounded up to the next whole month), and the denominator of which is the total
number of months constituting the entire Service Period.

(c)    Except as otherwise provided in Paragraph 3(b) above, should the
Participant’s Service cease for any reason prior to the completion of the
Service Period, then the Participant shall not vest in any additional
Performance–Qualified Shares following such cessation of Service, and all of
Participant’s right, title and interest to any unvested Performance–Qualified
Shares subject to this Award shall immediately terminate.

4.    Stockholder Rights. The holder of this Award shall not have any
stockholder rights, including voting, dividend or liquidation rights, with
respect to the shares of Class A Common Stock underlying the Award until
Participant becomes the record holder of those shares upon their actual issuance
following the Corporation’s collection of the applicable Withholding Taxes.

5.    Change in Control. The following provisions shall apply to the measurement
of each Performance Goal in the event of a Change in Control.

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Performance Goal I

(a)    Should (i) the Change in Control occur during the first __________ (___)
months of the Performance Period applicable to Performance Goal I and (ii) the
Participant continue in Service through the effective date of that Change in
Control, then the Participant shall immediately vest in that number of shares of
Class A Common Stock equal to the Target Number of Performance Shares allocated
to Performance Goal I in accordance with Paragraph 1, without any measurement of
Performance Goal I attainment to date.

(b)    Should (i) the Change in Control occur at any time on or after the
completion of the first __________ (___) months of the Performance Period
applicable to Performance Goal I but prior to ______________ and (ii) the
Participant continues in Service through the effective date of that Change in
Control, then the Participant shall immediately vest in that number of shares of
Class A Common Stock equal to the greater of:

(i)    the Target Number of Performance Shares allocated to Performance Goal I
in accordance with Paragraph 1, or

(ii)    the number of Performance–Qualified Shares determined by multiplying (A)
the Target Number of Performance Shares allocated to Performance Goal I in
accordance with Paragraph 1 by (B) the applicable percentage (determined in
accordance with attached Schedule I) for the level at which Performance Goal I
is attained and certified by the Plan Administrator for an abbreviated
Performance Period ending with the close of the Corporation’s fiscal quarter
coincident with or immediately preceding the effective date of the Change in
Control, with the applicable financial metric for the fiscal year in which the
Change in Control is effected to be calculated and measured as of the close of
the fiscal quarter coincident with or immediately preceding such effective date
and compared to the applicable financial metric for the immediately preceding
fiscal year calculated and measured over the same abbreviated time period within
that fiscal year.

(c)    Should a Change in Control occur on or after the scheduled ______________
completion date of the Corporation’s 2015 fiscal year, then the provisions of
Paragraphs 1 and 3 and Schedule I shall continue to apply to determine the
number of shares of Class A Common Stock (if any) to which Participant is
entitled under this Award .

Performance Goal II

(d)    Should (i) the Change in Control occur at any time prior to _____________
and (ii) the Participant continue in Service through the effective date of that
Change in Control, then the Participant shall immediately vest in that number of
shares of Class A Common Stock equal to the Target Number of Performance Shares
allocated to Performance Goal II in accordance with Paragraph 1, without any
measurement of Performance Goal II attainment to date.

(e)    Should (i) the Change in Control occur at any time on or after
____________, then the provisions of Paragraphs 1 and 3 and Schedule II shall
continue to apply to determine the number of shares of Class A Common Stock (if
any) to which Participant is entitled under this Award provided, however, that
should the Participant continue in Service through the effective date of that
Change in Control, then the Participant shall be deemed to have satisfied the
Service vesting requirement of Paragraph 3(a).

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Performance Goal III

(f)    Should (i) the Change in Control occur prior to ____________ and (ii) the
Participant continue in Service through the effective date of that Change in
Control, then the Participant shall immediately vest in that number of shares of
Class A Common Stock equal to the Target Number of Performance Shares allocated
to Performance Goal III in accordance with Paragraph 1, without any measurement
of Performance Goal III attainment to date.

(g)    Should the Change in Control occur at any time on or after __________,
then the provisions of Paragraphs 1 and 3 and Schedule III shall continue to
apply to determine the number of shares of Class A Common Stock (if any) to
which Participant is entitled under this Award; provided , however , that should
the Participant continue in Service through the effective date of that Change in
Control, then the Participant shall be deemed to have satisfied the Service
vesting requirement of Paragraph 3(a).

(h)    The share calculation procedures set forth in subparagraphs (a) through
(g) of this Paragraph 5 shall also apply for purposes of determining the number
of shares to which the Service–vesting provisions of Paragraph 3(a) and (if
applicable) Paragraph 3(b) are to be applied in the event the Participant ceases
Service and prior to the effective date of the Change in Control, and the
resulting number of shares shall be subject to the provisions of Paragraph 5(i)
below. For purposes of such calculation, the Service Period shall continue to be
measured as a ___________ (____) calendar month period ending ______________, as
if the Change in Control had not occurred.

(i)    The number of shares of Class A Common Stock in which Participant vests
on the basis of the Performance Shares or Performance Qualified Shares
determined in accordance with the foregoing provisions of this Paragraph 5 shall
be converted into the right to receive for each such share the same
consideration per share of Class A Common Stock payable to the other holders of
such Class A Common Stock in consummation of that Change in Control, and such
consideration per share shall be distributed to the Participant at the same time
as such stockholder payments, but in no event shall such distribution to the
Participant be completed later than the later of (i) the last day of the
calendar year in which such Change in Control is effected or (ii) the fifteenth
(15th) day of the third (3rd) calendar month following the effective date of
that Change in Control. The distribution shall be subject to the Corporation’s
collection of the applicable Withholding Taxes.

(j)    Except for the actual number of shares of Class A Common Stock in which
the Participant vests in accordance with this Paragraph 5, the Participant shall
cease to have any further right or entitlement to any additional shares of Class
A Common Stock under this Agreement following the effective date of the Change
in Control.

(k)    This Agreement shall not in any way affect the right of the Corporation
to adjust, reclassify, reorganize or otherwise change its capital or business
structure or to merge, consolidate, dissolve, liquidate or sell or transfer all
or any part of its business or assets.

6.    Adjustment in Shares. Should any change be made to the Class A Common
Stock by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares, spin–off transaction, extraordinary
dividend or distribution or other change affecting the outstanding Common Stock
as a class without the Corporation’s receipt of consideration, or should the
value of the outstanding shares of Common Stock be substantially reduced as a
result of a spin–off transaction or an extraordinary dividend or distribution,
or should there occur any merger, consolidation or other reorganization, then

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equitable adjustments shall be made by the Plan Administrator to the total
number and/or class of securities issuable pursuant to this Award in order to
reflect such change. The determination of the Plan Administrator shall be final,
binding and conclusive. In the event of any Change in Control transaction, the
provisions of Paragraph 5 shall be controlling.

7.    Issuance or Distribution of Vested Shares or Other Amounts.

(a)    Except as otherwise provided in Paragraph 5, the shares of Class A Common
Stock in which Participant vests pursuant to the Performance and Service vesting
provisions of Paragraphs 1 and 3 shall be issued as soon as administratively
practicable following the scheduled ______________ completion date of the
Corporation’s ____ fiscal year, but in no event later than the fifteenth (15th)
day of third (3rd) calendar month following such completion date.

(b)    The Corporation shall, on the applicable issuance date, issue to or on
behalf of Participant a certificate (which may be in electronic form) for the
shares of Class A Common Stock in which Participant vests pursuant to the
Performance and Service vesting provisions of Paragraphs 1 and 3 or the special
vesting provisions of Paragraph 5.

(c)    Except as otherwise provided in Paragraph 5, no shares of Class A Common
Stock shall be issued prior to the scheduled ______________ completion date of
the Corporation’s ____ fiscal year. No fractional share of Class A Common Stock
shall be issued pursuant to this Award, and any fractional share resulting from
any calculation made in accordance with the terms of this Agreement shall be
rounded down to the next whole share of Class A Common Stock.

(d)    The Corporation shall collect the applicable Withholding Taxes with
respect to all shares of Class A Common Stock which vest and become issuable
pursuant to the provisions of this Agreement through the following automatic
share withholding method:

–    On the applicable issuance date, the Corporation shall with–hold, from the
vested shares of Class A Common Stock otherwise issuable to the Participant at
that time, a portion of those shares with a Fair Market Value (measured as of
the issuance date) equal to the applicable Withholding Taxes; provided, however,
that the number of shares of Class A Common Stock which the Corporation shall be
required to so withhold shall not exceed in Fair Market Value (other than by
reason of the rounding up of any fractional share to the next whole share) the
amount necessary to satisfy the Corporation’s required tax withholding
obligations using the minimum statutory withholding rates for federal and state
tax purposes, including payroll taxes, that are applicable to supplemental
taxable income. The Participant hereby expressly authorizes the Corporation to
withhold any such additional fractional share that is needed to round up the
share withholding to the next whole share of Class A Common Stock, with the Fair
Market Value of that additional fractional share to be added to the amount of
taxes withheld by the Corporation from his or her wages for the calendar year in
which the issuance date occurs, and to report that additional tax withholding as
part of his or her W–2 tax withholdings for such year.

(e)    Except as otherwise provided in Paragraph 5 or this Paragraph 7, the
settlement of all Performance or Performance–Qualified Shares which vest under
the Award shall be made solely in shares of Class A Common Stock.

8.    Code Section 409A

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(a)    It is the intention of the parties that the provisions of this Agreement
shall comply with the requirements of the short–term deferral exception to
Section 409A of the Code and Treasury Regulations Section 1.409A–1(b)(4).
Accordingly, to the extent there is any ambiguity as to whether one or more
provisions of this Agreement would otherwise contravene the requirements or
limitations of Code Section 409A applicable to such short–term deferral
exception, then those provisions shall be interpreted and applied in a manner
that does not result in a violation of the requirements or limitations of Code
Section 409A and the Treasury Regulations thereunder that apply to such
exception.

(b)    If and to the extent this Agreement may be deemed to create an
arrangement subject to the requirements of Code Section 409A, then the following
provisions shall apply:

–    No shares of Class A Common Stock or other amounts which become issuable or
distributable under this Agreement by reason of Participant’s cessation of
Service shall actually be issued or distributed to Participant until the date of
Participant’s Separation from Service or as soon thereafter as administratively
practicable, but in no event later than the later of (i) the last day of the
calendar year in which such Separation from Service occurs or (ii) the fifteenth
day of the third calendar month following the date of such Separation from
Service.

–    No shares of Class A Common Stock or other amounts which become issuable or
distributable under this Agreement by reason of Participant’s Separation from
Service shall actually be issued or distributed to Participant prior to the
earlier of (i) the first day of the seventh (7th) month following the date of
such Separation from Service or (ii) the date of Participant’s death, if
Participant is deemed at the time of such Separation from Service to be a
specified employee under Section 1.409A–1(i) of the Treasury Regulations issued
under Code Section 409A, as determined by the Plan Administrator in accordance
with consistent and uniform standards applied to all other Code Section 409A
arrangements of the Corporation, and such delayed commencement is otherwise
required in order to avoid a prohibited distribution under Code Section
409A(a)(2). The deferred shares or other distributable amount shall be issued or
distributed in a lump sum on the first day of the seventh (7th) month following
the date of Participant’s Separation from Service or, if earlier, the first day
of the month immediately following the date the Corporation receives proof of
Participant’s death.

–    No amounts that vest and become payable under Paragraph 5 of this Agreement
by reason of a Change in Control shall be distributed to the Participant at the
time of such Change in Control, unless that transaction also qualifies as a
change in control event under Code Section 409A and the Treasury Regulations
thereunder. In the absence of such a qualifying change in control, the
distribution shall not be made until the first business day following the
scheduled ______________ completion date of the Corporation’s ____ fiscal year
or as soon as administratively practicable following thereafter, but in no event
later than the fifteenth (15th) day of the third (3rd) calendar month following
such completion date.

–    In no event shall the Participant have the right to determine the calendar
year in which such issuance or distribution is to occur. Accordingly, if the
time period for delivery of the Participant’s requisite release pursuant to the
terms of the Senior Executive Severance Pay Plan spans two taxable years, any
issuance or distribution under this Agreement that would otherwise be triggered
by that effective and enforceable release will

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not be effected during that period but will instead be effected during the
remainder of the applicable time period for effecting that issuance or
distribution in accordance with the terms of this Agreement.

9.    Compliance with Laws and Regulations. The issuance of shares of Class A
Common Stock pursuant to the Award shall be subject to compliance by the
Corporation and Participant with all applicable requirements of law relating
thereto and with all applicable regulations of any Stock Exchange on which the
Class A Common Stock may be listed for trading at the time of such issuance.

10.    Successors and Assigns. Except to the extent otherwise provided in this
Agreement, the provisions of this Agreement shall inure to the benefit of, and
be binding upon, the Corporation and its successors and assigns and the
Participant and the legal representatives, heirs and legatees of the
Participant’s estate and any beneficiaries of the Award designated by the
Participant.

11.    Notices. Any notice required to be given or delivered to the Corporation
under the terms of this Agreement shall be in writing and addressed to the
Corporation at its principal corporate offices or shall be effected by properly
addressed electronic mail delivery. Any notice required to be given or delivered
to the Participant shall be in writing and addressed to the Participant at the
most recent address then on file for the Participant in the Corporation’s Human
Resources Department. All notices shall be deemed effective upon personal
delivery or upon deposit in the U.S. mail, postage prepaid and properly
addressed to the party to be notified.

12.    Construction. This Agreement and the Award evidenced hereby are made and
granted pursuant to the Plan and are in all respects limited by and subject to
the terms of the Plan. All decisions of the Plan Administrator with respect to
any question or issue arising under the Plan or this Agreement shall be
conclusive and binding on all persons having an interest in the Award.

13.    Governing Law. The interpretation, performance and enforcement of this
Agreement shall be governed by the laws of the State of Arizona without resort
to that State’s conflict–of–laws rules.

14.    Employment at Will. Nothing in this Agreement or in the Plan shall confer
upon the Participant any right to remain in Service for any period of specific
duration or interfere with or otherwise restrict in any way the rights of the
Corporation or of the Participant, which rights are hereby expressly reserved by
each, to terminate Participant’s Service at any time for any reason, with or
without cause.

15.    Proprietary Information and Intellectual Property Agreement. The
Participant accepts and agrees to comply with the terms of the Corporation’s
Proprietary Information and Intellectual Property Agreement (“PIIPA”), attached
hereto as Appendix B and incorporated herein by reference.

16.    Participant Acceptance. Participant must accept the terms and conditions
of this Agreement, including the PIIPA, either electronically through the
electronic acceptance procedure established by the Corporation or through a
written acceptance delivered to the Corporation in a form satisfactory to the
Corporation. In no event shall any shares of Class A Common Stock be issued
under this Agreement in the absence of such acceptance.

IN WITNESS WHEREOF, Apollo Group, Inc. has caused this Agreement to be executed
on its behalf by its duly–authorized officer on the day and year first indicated
above.

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APOLLO GROUP, INC.
 
 
 
 
By:
 
 
 
Title:
 
 
 
 
 
PARTICIPANT
 
 
 
 

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APPENDIX A

DEFINITIONS

The following definitions shall be in effect under the Agreement:

A.    Agreement shall mean this Performance Share Award Agreement.

B.    Award shall mean the award of Performance Shares made to the Participant
pursuant to the terms of this Agreement.

C.    Award Date shall mean the date the award of Performance Shares is made to
the Participant pursuant to the Agreement and shall be the date indicated in
Paragraph 1 of the Agreement.

D.    Board shall mean the Corporation’s Board of Directors.

E.    Cause (if applicable) shall have the meaning assigned to such term in the
Participant’s Employment Agreement, as in effect on the Award Date.

F.    Change in Control shall have the meaning assigned to such term in Section
3.1(e) of the Plan.

G.    Code shall mean the Internal Revenue Code of 1986, as amended.

H.    Class A Common Stock shall mean shares of the Corporation’s Class A common
stock.

I.    Corporation shall mean Apollo Group, Inc., an Arizona corporation, and any
successor corporation to Apollo Group, Inc. which shall by appropriate action
adopt the Plan.

J.    Employee shall mean an individual who is in the employ of the Corporation
(or any Parent or Subsidiary), subject to the control and direction of the
employer entity as to both the work to be performed and the manner and method of
performance.

K.    Employment Agreement (if applicable) shall mean the Employment Agreement
between the Corporation and the Participant dated _____________________.

L.    Fair Market Value per share of Class A Common Stock on any relevant date
shall be the closing price per share of such Class A Common Stock on date in
question on the Stock Exchange serving as the primary market for the Class A
Common Stock, as such price is reported by the National Association of
Securities Dealers (if primarily traded on the Nasdaq Global or Global Select
Market) or as officially quoted in the composite tape of transactions on any
other Stock Exchange on which the Class A Common Stock is then primarily traded.
If there is no closing selling price for the Class A Common Stock on the date in
question, then the Fair Market Value shall be the closing price on the last
preceding date for which such quotation exists.

M.    Good Reason (if applicable) shall have the meaning assigned to such term
in the Employment Agreement, as in effect on the Award Date.

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N.    Involuntary Termination (if applicable) shall mean the unilateral
termination of the Participant’s Service by the Corporation (or any Parent or
Subsidiary employing Participant) for any reason other than a Termination for
Cause; provided, however, in no event shall an Involuntary Termination be deemed
to incur in the event the Participant’s Service terminates by reason of his or
her death or disability.

O.    1934 Act shall mean the Securities Exchange Act of 1934, as amended from
time to time.

P.    Participant shall mean the person to whom the Award is made pursuant to
the Agreement.

Q.    Parent shall mean any corporation (other than the Corporation) in an
unbroken chain of corporations ending with the Corporation, provided each
corporation in the unbroken chain (other than the Corporation) owns, at the time
of the determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

R.    Performance Goal shall mean any of the performance goals specified in
Schedules I and II to this Agreement.

S.    Performance Goal I shall mean the Performance Goal specified in Schedule I
to this Agreement.

T.    Performance Goal II shall mean the Performance Goal specified in Schedule
II to this Agreement.

U.    Performance Goal III shall mean the Performance Goal specified in Schedule
III to this Agreement.

V.    Performance Period shall mean, for each Performance Goal, the period
specified on the attached Schedule to this Agreement pertaining to that
Performance Goal over which the attainment of that particular Performance Goal
is to be measured.

W.    Performance–Qualified Shares shall mean the maximum number of shares of
Class A Common Stock in which Participant can vest based on the level at which
each of the Performance Goals is attained over the applicable Performance Period
for that goal and shall be calculated in accordance with the provisions of this
Agreement. In no event shall the aggregate number of such Performance–Qualified
Shares exceed three hundred percent (300%) of the Target Number of Performance
Shares set forth in Paragraph 1 of this Agreement.

X.    Performance Share shall mean the phantom shares of Class A Common Stock
awarded under this Agreement which will entitle Participant to receive one or
more actual shares of Class A Common Stock pursuant to this Award upon the
satisfaction of the performance and Service vesting requirements applicable to
such Award.

Y.    Plan shall mean the Corporation’s 2000 Stock Incentive Plan, as amended or
restated from time to time.

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Z.    Plan Administrator shall mean the Compensation Committee of the Board
acting in its capacity as administrator of the Plan.

AA.    Service shall mean Participant’s performance of services for the
Corporation (or any Parent or Subsidiary) in the capacity of an Employee. For
purposes of this Agreement, Participant shall be deemed to cease Service
immediately upon the occurrence of the either of the following events: (i)
Participant no longer performs services in an Employee capacity for the
Corporation (or any Parent or Subsidiary) or (ii) the entity for which
Participant performs services in an Employee capacity ceases to remain a Parent
or Subsidiary of the Corporation, even though Participant may subsequently
continue to perform services for that entity. Service as an Employee shall not
be deemed to cease during a period of military leave, sick leave or other
personal leave approved by the Corporation; provided, however, that except to
the extent otherwise required by law or expressly authorized by the Plan
Administrator or by the Corporation’s written policy on leaves of absence, no
Service credit shall be given for vesting purposes for any period Participant is
on a leave of absence.

BB.    Service Period shall mean the thirty–six (36)–month period coincident
with the Corporation’s ____ through ____ fiscal years (the period from
__________ to _____________) over which the installment Service–vesting
requirements of this Agreement are to be measured.

CC.    Separation from Service shall mean Participant’s cessation of Employee
status by reason of death, retirement or termination of employment. Participant
shall be deemed to have terminated employment for such purpose at such time as
the level of his or her bona fide services to be performed as an Employee (or as
a consultant or independent contractor) permanently decreases to a level that is
not more than twenty percent (20%) of the average level of services he or she
rendered as an Employee during the immediately preceding thirty–six (36) months.
Any such determination as to Separation from Service shall be made in accordance
with the applicable standards of the Treasury Regulations issued under Section
409A of the Code.

DD.    Stock Exchange shall mean the American Stock Exchange, the Nasdaq Global
or Global Select Market or the New York Stock Exchange.

EE.    Subsidiary shall mean any corporation (other than the Corporation) in an
unbroken chain of corporations beginning with the Corporation, provided each
corporation (other than the last corporation) in the unbroken chain owns, at the
time of the determination, stock possessing fifty percent (50%) or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.

FF.    Target Number of Performance Shares shall mean the number of Performance
Shares set forth in Paragraph 1 of this Agreement that will be used to calculate
the number of Performance–Qualified Shares based on the level at which each
Performance Goal is attained and the applicable conversion percentage specified
for that level in the attached Schedule pertaining to that Performance Goal.

GG.    Termination for Cause (if applicable) shall mean the termination of the
Participant’s Service by the Corporation (or any Parent or Subsidiary employing
Participant) for one or more of the following reasons:

(i)    repeated dereliction of the material duties and responsibilities of his
or her position with the Corporation (or any Parent or Subsidiary);

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(ii)    misconduct, insubordination or failure to comply with the policies of
the Corporation (or any Parent or Subsidiary employing the Participant)
governing employee conduct and procedures;

(iii)    excessive lateness or absenteeism;

(iv)    conviction of or pleading guilty or nolo contendere to any felony
involving theft, embezzlement, dishonesty or moral turpitude;

(v)    commission of any act of fraud against, or the misappropriation of
property belonging to, the Corporation (or any Parent or Subsidiary);

(vi)    commission of any act of dishonesty in connection with his or her
responsibilities as an Employee that is intended to result in his or her
personal enrichment or the personal enrichment of his or her family or others;

(vii)    any other misconduct adversely affecting the business or affairs of the
Corporation (or any Parent or Subsidiary); or

(viii)    a material breach of any agreement the Participant may have at the
time with the Corporation (or any Parent or Subsidiary employing the
Participant), including (without limitation) any proprietary information,
non–disclosure or confidentiality agreement.

HH.    Withholding Taxes shall mean the federal, state and local income taxes
and the employee portion of the federal, state and local employment taxes
required to be withheld by the Corporation in connection with the vesting and
issuance of the shares of Common Stock which vest under of the Award and any
phantom dividend equivalents distributed with respect to those shares.

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APPENDIX B

PROPRIETARY INFORMATION AND INTELLECTUAL PROPERTY
AGREEMENT

This Proprietary Information and Intellectual Property Agreement (“PIIPA”)
confirms certain terms of my employment with Apollo Group, Inc., is a condition
of my employment, and is a material part of the consideration for my employment
by the Company. The headings contained in this PIIPA are for convenience only,
have no legal significance, and are not intended to change or limit this PIIPA
in any matter whatsoever. Capitalized terms not defined in this PIIPA have the
meanings ascribed to them in the Company’s Intellectual Property Policy. I have
read and agree to comply with such policy. I understand that the Intellectual
Property Policy may be amended from time to time by the Company. I further
understand and agree that I am obligated to comply with such amendments and will
review this policy periodically to ensure that I am aware of such amendments. If
there is any conflict between the terms of such policy and this PIIPA, the terms
of this PIIPA will prevail.

A.    Definitions
1.    The “Company”
As used in this PIIPA, the “Company” refers to Apollo Group, Inc., each of its
subsidiaries, parent companies, and successors and assigns. A subsidiary is any
company that is directly or indirectly, wholly or partially, owned by Apollo
Group, Inc. I recognize and agree that my obligations under this PIIPA and all
terms of this PIIPA apply to me regardless of whether I am employed by or
provide services to Apollo Group, Inc. or any subsidiary, parent company,
successor or assign of Apollo Group, Inc.
2.    “Proprietary Information
I understand that the Company possesses and will possess Proprietary Information
which is important to its business. For purposes of this PIIPA, “Proprietary
Information” is information that was or will be developed, created, or
discovered by or on behalf of the Company, or which became or will become known
by, or was or is conveyed to the Company. “Proprietary Information” includes
information concerning the organization, business and finances of the Company or
of any third party which the Company is under an obligation to keep confidential
or that is maintained by the Company as confidential, including (without
limitation):
a.the Company’s Lead List which is comprised of prospective students;

b.data and information on current and prospective corporate accounts, including,
but not limited to, the identity of the corporate accounts, the decision makers
or decision influencers, the buying criteria of the accounts and programs for
those accounts;

c.information with respect to past, current and prospective merger, acquisition,
disposition, joint venture and other transactions and opportunities, including,
but not limited to, the identity of the transaction targets or prospects, the
decision makers or decision influencers with respect to the transactions, the
proposed terms and conditions of any such past, current or prospective
transactions or opportunities, including the status thereof;

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d.the management process, training materials, scripts, programs and preferred
responses to features and benefits provided to enrollment counselors, academic
counselors and finance counselors;

e.the certification training materials and processes for the certification of
the Company’s student advisors (known as the ACU online learning system
program), including, but not limited to, the tests taken, materials provided and
course work;

f.the information and data contained in the Company’s enrollment data system,
including all monthly enrollment reports;

g.salary, terms of employment, length of employment and performance review
information on the faculty members and other employees of the Company, all
business models and financial information, data and materials of the Company not
otherwise available to the general public through the Company’s Annual Report or
otherwise;

h.all market research or works for hire materials, including, but not limited
to, industry data, demographics, company profiles and/or specific consumer
behavior information, all monthly financial, statistical and operational
information and reports, and all other information concerning enrollment by
campus, profit and loss per campus and the terms of any lease;

i.all monthly financial statements, including, but not limited to, any materials
prepared for the Board of Directors;

j.all internally developed source code and the techniques and processes embodied
therein, including, but not limited to, modifications to existing source codes
for student information systems (such as Galaxy, Campus Tracking, OSIRIS and
eCampus), academic systems (such as rEsource and OnLine Learning System (OLS),
proprietary modifications to packaged applications (such as PeopleSoft, Oracle
Financials and ADP HRizon) and all future internally developed source code;

k.information provided to the Company from a third party under a non–disclosure
agreement;

l.    the “Personally Identifiable Information” of any individual that is known
or accessible as a result of employment with the Company. “Personally
Identifiable Information” includes, but is not limited to information that is
directly associated with a specific person such as a name, address, telephone
number, e–mail address, or information about activities directly linked to that
person. It also includes, but is not limited to, “Education Records” as that
term is defined in the Family Educational Rights and Privacy Act of 1974, as
amended.
I understand and agree that my employment creates a relationship of confidence
and trust between the Company and me with respect to Proprietary Information.
3.    “Company Documents and Materials”
I understand that the Company possesses or will possess “Company Documents and
Materials” which are important to its business. For purposes of this PIIPA,
“Company Documents and Materials” are documents or other media or tangible items
that contain or embody Proprietary Information or any other information
concerning the business, operations or plans of the Company, whether such
documents, media or items have been prepared by me or by others.

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“Company Documents and Materials” include (without limitation) blueprints,
drawings, photographs, charts, graphs, notebooks, customer lists, computer
disks, tapes, computer hard drives, floppy disks, CD ROMS, or printouts, sound
recordings and other printed, typewritten or handwritten documents, sample
products, prototypes and models and any information recorded in any other form
whatsoever. “Company Documents and Materials” also include copies of any of the
foregoing.
B.    Assignment of Rights and Confidentiality Requirements
All Proprietary Information is and shall be the sole property of the Company. I
hereby grant and assign, and agree to grant and assign, to the Company any and
all rights, title and interest I may have or acquire in such Proprietary
Information.
At all times, both during my employment by the Company and after its
termination, I will keep in confidence and trust and will not use or disclose
any Proprietary Information or anything relating to it without the prior written
consent of an officer of the Company as specified in the Company’s Schedule of
Executive Authority (“SEA”), except as may be necessary in the ordinary course
of performing my duties to the Company. I acknowledge that, without prejudice to
any and all rights of the Company, an injunction is the only effective remedy to
protect the Company’s rights and property as set out herein.
C.    Maintenance and Return of Company Documents and Materials
I agree to make and maintain adequate and current written records, in a form
specified by the Company, of all inventions, trade secrets and works of
authorship assigned or to be assigned to the Company pursuant to this PIIPA. All
Company Documents and Materials are and shall be the sole property of the
Company.
I agree that during my employment by the Company, I will not remove any Company
Documents and Materials from the business premises of the Company or deliver any
Company Documents and Materials to any person or entity outside the Company,
except in connection with performing the duties of my employment. I further
agree that, immediately upon the termination of my employment by me or by the
Company for any reason, or during my employment if so requested by the Company,
I will return all Company Documents and Materials, apparatus, equipment and
other physical property, or any reproduction of such property, excepting only
(i) my personal copies of records relating to my compensation; (ii) my personal
copies of any materials previously distributed generally to stockholders of the
Company; and (iii) my copy of this PIIPA.
D.    Disclosure of Intellectual Property to the Company
I will promptly disclose in accordance with the Company’s Intellectual Property
Policy, all Company Intellectual Property (as defined below) which includes
(without limitation) all software programs or subroutines, source or object
code, algorithms, improvements, inventions, works of authorship, trade secrets,
technology, designs, formulas, ideas, processes, techniques, know–how and data,
whether or not patentable, and any other property subject to legal protection by
patents, copyrights, trademarks, and/or trade secrets, or which may become
subject to legal protection hereafter, whether or not they were, are, or will be
so protected, which are made or discovered or conceived or reduced to practice
or developed by me, either alone or jointly with others, during the term of my
employment.
I will also disclose in accordance with the Company’s Intellectual Property
Policy, all Company Intellectual Property made, discovered, conceived, reduced
to practice, or developed by me within six (6) months after the termination of
my employment with the Company which resulted, in whole or in

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part, from my prior employment by the Company. Such disclosures shall be
received by the Company in confidence (to the extent such Company Intellectual
Property are not assigned to the Company pursuant to Section (E) below) and do
not extend the assignment made in Section (E) below.
I agree to disclose Company Intellectual Property to the Company upon the first
to occur of:
1.    Creation;
2.    A request by Intellectual Property (“IP”) Counsel, as appointed by the
Company’s General Counsel, or a designee of IP Counsel;
3.    As required by any applicable External Sponsor contract, by this
Agreement, or by any other Company policy;
4.    A determination is made by me that the Company or an External Sponsor may
have an interest in the Intellectual Property.
I understand and agree that my disclosure of the creation of Company
Intellectual Property must occur prior to any discussions or actions involving
the Commercial Application of Company Intellectual Property and prior to any
non–confidential presentation or other public release of the Company
Intellectual Property. “Commercial Application of Intellectual Property” means
any application of Intellectual Property in which an Employee or the Company
intends to obtain, or is likely to receive, economic gain from the use or
disposition of the Intellectual Property.
I further agree to disclose promptly to IP Counsel any potentially unauthorized
use of Company Intellectual Property by a third party.
Notwithstanding any other provision of this Agreement to the contrary, this
Agreement does not obligate me to assign to the Company any of my rights in
Intellectual Property that does not qualify as Company Intellectual Property.
“Company Intellectual Property” is Intellectual Property that: (a) is created in
the scope of my employment; (b) is developed, in whole or in part, by the use of
Company Resources (excluding resources accessed and used entirely as part of a
student or faculty academic endeavor at any subsidiary); (c) relates to the
business of the Company or to the Company’s actual or demonstratably anticipated
strategies, plans or research and development; or (d) contains Company
Proprietary Information. Company Resources include, but are not limited to the
following resources owned or controlled by Apollo Group, Inc., or a subsidiary:
facilities, computers, research funding, resources for asynchronous or distance
learning programs, paid time within the employment period, assistance of support
staff, telecommunication services, central computing resources, instructional or
graphic design or other production services, Company trade secret information,
and any other equipment, technologies or facilities.
E.    Right to New Ideas
1.    Assignment of Intellectual Property to the Company
I agree that all Company Intellectual Property that I make, discover, conceive,
reduce to practice or develop (in whole or in part, either alone or jointly with
others) during my employment shall be the sole property of the Company to the
maximum extent permitted by applicable law. However, any Intellectual Property
that I make, discover, conceive, reduce to practice or develop (in whole or in
part, either alone or jointly with others) during my employment shall not be the
sole property of the Company so long as such Intellectual Property does not
qualify as Company Intellectual Property.

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The Company shall be the sole owner of all patents, patent rights, copyrights,
trade secret rights, trademark rights and all other intellectual property or
other rights in connection with Company Intellectual Property. I hereby assign
and agree to assign to the Company any and all rights, title and interest I may
have or acquire in Company Intellectual Property.
I agree to receive written approval from IP Counsel prior to incorporating, in
any manner or fashion, any Intellectual Property not fully–owned by the Company
into Company Intellectual Property.
If I incorporate any Intellectual Property in which I have an interest into
Company Intellectual Property or any Company product, service, or process, I
hereby grant and agree to grant to the Company a royalty–free, fully paid–up,
irrevocable, perpetual, sublicensable, worldwide license to make, have made,
modify, use, market, sell and distribute any such Intellectual Property as part
of or in connection with Company Intellectual Property or Company product,
service or process in any media now known or later developed.
Furthermore, if I incorporate, without prior written approval, any Intellectual
Property in which any party other than the Company has an interest into Company
Intellectual Property or any Company product, service, or process, I agree to
indemnify the Company for any consequences of such incorporation.
2.    Works Made for Hire
I further acknowledge and agree that Company Intellectual Property, including
(without limitation) any computer programs, programming documentation, and other
works of authorship, are “works made for hire” for purposes of the Company’s
rights under copyright laws. I hereby assign and agree to assign to the Company
any and all rights, title and interest I may have or acquire in such works made
for hire.

3.    Cooperation
I agree to perform, during and after my employment, all acts deemed necessary or
desirable by the Company to permit and assist it, at the Company’s expense, in
further evidencing and perfecting the assignments made to the Company under this
PIIPA and in obtaining, maintaining, defending and enforcing patents, patent
rights, copyrights, trademark rights, trade secret rights or any other rights in
connection with Company Intellectual Property and improvements thereto in any
and all jurisdictions. Such acts may include (without limitation) execution of
documents and assistance or cooperation in legal proceedings. I hereby
irrevocably designate and appoint and agree to appoint the Company and its duly
authorized officers and agents, as my agents and attorneys to act for and on my
behalf and instead of me, to execute and file any documents, applications or
related findings and to do all other lawfully permitted acts in the same manner
as I could do to further the purposes set forth above in this Subsection 3,
including (without limitation) the perfection of assignment and the prosecution
and issuance of patents, patent applications, copyright applications and
registrations, trademark applications and registrations or other rights in
connection with Company Intellectual Property and improvements thereto with the
same legal force and effect as if executed by me.
4.    Assignment or Waiver of Moral Rights
Any assignment of copyright hereunder (and any ownership of a copyright as a
work made for hire) includes all rights of paternity, integrity, disclosure and
withdrawal and any other rights that may be known as or referred to as “moral
rights” in applicable copyright or other legislation (collectively “Moral
Rights”). To the extent such Moral Rights cannot be assigned under applicable
law of a jurisdiction, and to

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the extent the following is allowed by the laws in the various jurisdictions
where Moral Rights exist, I hereby waive the whole of my Moral Rights in any
work and warrant that any work created by me is original.
5.    List of Intellectual Property
I have attached hereto as Exhibit A a complete list of all Intellectual Property
or improvements to which I claim ownership and that I desire to remove from the
operation of this PIIPA (except for the license granted in Section (E)(1)
above), and I acknowledge and agree that such list is complete. If no such list
is attached to this PIIPA, I represent that I have no such Intellectual Property
at the time of signing this PIIPA.
F.    Company Authorization for Publication
Prior to my submitting or disclosing for possible non–confidential publication
or dissemination outside the Company any material prepared by me that
incorporates information that concerns the Company’s Intellectual Property or
its business or anticipated research, I agree to deliver a copy of such material
to an officer of the Company as specified in the SEA for his or her review and
written consent. I agree to make such deletions and revisions as are reasonably
requested by the Company to protect its Proprietary Information and Intellectual
Property.
G.    Former Employer’s and Others’ Information
I represent that my performance of all the terms of this PIIPA does not and will
not breach any agreement to keep in confidence proprietary information,
knowledge or data acquired or developed by me in confidence or in trust prior to
my employment by the Company.
I agree that I will not disclose to the Company, or use in the performance of my
duties and responsibilities as an employee of the Company, any trade secrets or
confidential or proprietary information or material belonging to any previous
employers or other person or entity.
H.    Competition; Non–Solicitation of Employees
I agree that (a) during the term of my employment by the Company, I will not
engage in any employment or business activity that is competitive with, or which
could conflict with my employment by the Company without first disclosing such
activity to the Company and obtaining its express written approval, which may be
denied in the Company’s sole discretion, and (b) for the period of my employment
by the Company and for one (1) year thereafter, I will not, either directly or
indirectly, solicit, attempt to solicit, or assist in the solicitation of any
employee, independent contractor, or consultant of the Company for whom I had
managerial responsibility, to whom I reported, with whom I participated on
Company teams or projects, or about whom I gained confidential salary or
performance information, to terminate his or her relationship with the Company.
If there is a conflict between this provision and any restrictive covenants
contained in any employment agreement executed by me and the Company, the
provisions of the employment agreement will govern.
I.    At–Will Employment
I understand that my employment with the Company is not for a definite term and
either I or the Company can terminate the employment relationship at any time,
with or without cause or advance notice, subject to any severance benefits to
which I may become entitled to pursuant to the provisions of any employment
agreement in effect at the time between me and the Company. The terms of this
Agreement survive the termination of employment as provided for herein.

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J.    Reformation and Severability
I agree that if any provision, or portion of a provision, of this Agreement is
deemed unenforceable by reason of the scope, extent or duration of its coverage,
then such provision shall be deemed amended to the extent necessary to conform
to applicable law so as to be valid and enforceable. Should any provision, or
portion of a provision, of this Agreement be deemed unenforceable for any other
reason, such unenforceability will not affect any other provision, or portion of
a provision, of this Agreement and this Agreement shall be construed as if such
unenforceable provision, or portion of provision, had never been contained
herein.
K.    Authorization for Post–Termination Notification of Obligations under PIIPA
I hereby authorize the Company to notify any person or entity with whom I become
employed, or to whom I provide services, following the termination of my
employment with the Company of my ongoing obligations under this PIIPA.
L.    Entire Agreement
This PIIPA sets forth the entire agreement and understanding between the Company
and me relating to the subject matters covered therein, and this PIIPA merges,
cancels, supersedes and replaces all prior discussions between us, including
(without limitation) any and all statements, representations, negotiations,
promises or agreements relating to the subject matters covered by this PIIPA
that may have been made by any officer, employee or representative of the
Company. Furthermore, any subsequent change(s) to my job duties,
responsibilities, title, reporting level or relationship, compensation,
benefits, regular place of employment or any other term or condition of my
employment with the Company shall not affect the validity or scope of this
Agreement which shall remain in full force and effect notwithstanding any such
change(s).
M.    Effective Date
This Agreement shall be effective as of the first day of my employment with the
Company and shall be binding upon me, my heirs, executors, assigns and
administrators and shall inure to the benefit of the Company.
N.    Governing Law
Although I may work for the Company outside of Arizona or the United States, I
understand and agree that this Agreement will be interpreted and enforced in
accordance with the laws of the State of Arizona.
I HAVE READ THIS PIIPA CAREFULLY, AND I UNDERSTAND AND ACCEPT THE OBLIGATIONS
THAT IT IMPOSES UPON ME WITHOUT RESERVATION.
I SIGN THIS PIIPA FREELY AND VOLUNTARILY, WITHOUT COERCION OR DURESS.

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Date:
 
 
 
 
 
 
 
Employee Signature
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Employee Name [Please Print]
 
 
 
 
 
For Apollo Group, Inc.:
 
 
 
 
 
 
 
 
Brian L. Swartz
 
 
 
SVP and CFO
 
 
 

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EXHIBIT A
1.
The following is a complete list of all Intellectual Property relevant to the
subject matter of my employment by the Company that have been made or discovered
or conceived or first reduced to practice by me or jointly with others prior to
my employment by the Company that I desire to remove from the operation of the
Company’s Proprietary Information and Intellectual Property Agreement (“PIIPA”),
except for the license granted in Section (E)(2) of the PIIPA:

    
No Intellectual Property.

    
See below:

    
See _____ (#) additional sheets attached.

2.
I propose to bring to my employment the following materials and documents of a
former employer or other person/entity:

    
No materials or documents

    
See below:

    
See ____ (#) additional sheet(s) attached:

Date:
 
 
 
 
 
 
Employee Signature
 
 
 
 

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SCHEDULE I
PERFORMANCE GOAL I AND APPLICABLE PERFORMANCE PERIOD

PERFORMANCE PERIOD

The measurement period for Performance Goal I shall be the ______ (__)
fiscal–year period beginning September 1, ______ and ending August 31, _____
(the “ Performance Period ”)

PERFORMANCE GOAL FOR PERFORMANCE VESTING

Performance Goal I
SPECIFY PERFORMANCE GOAL
Performance–Qualified Shares: The actual number of Performance–Qualified Shares
may range from 0% to ____% of the Target Number of Performance Shares allocated
to Performance Goal I in accordance with Paragraph 1 of this Agreement, with the
actual percentage to be determined on the basis of the attained level of
Performance Goal I. In no event, however, shall the maximum number of the shares
of the Corporation’s Class A Common Stock that may qualify as
Performance–Qualified Shares as a result of Performance Goal I attainment exceed
____% of the Target Number of Performance Shares allocated to Performance Goal I
in accordance with Paragraph 1 of this Agreement.
Schedule for Determining Number of Performance–Qualified Shares Based on
Performance Goal Attainment:
SPECIFY SCHEDULE OF CONVERSION PERCENTAGES

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