EXHIBIT 10.7
AMENDMENT NO. 2
TO
EMPLOYMENT AGREEMENT
     The EMPLOYMENT AGREEMENT entered into by and between Apollo Group, Inc.
(the “Company”) and Joseph L. D’Amico (the “Executive”), effective June 5, 2007
and subsequently amended effective as of June 15, 2007 ( the “Agreement”), is
hereby further amended as follows, effective as of January 1, 2009, except as
otherwise specified below. The purpose of this Amendment No. 2 is to bring the
Agreement into documentary compliance with the applicable requirements of the
Treasury Regulations issued under Section 409A of the Internal Revenue Code of
1986, as amended.
     1. The last sentence of Section 3(b) is hereby amended to read as follows:
     The Annual Bonus for each fiscal year shall be paid in accordance with the
Company’s customary practices, but in no event later than the fifteenth day of
the third calendar month following the end of that fiscal year.
     2. Section 4(c) of the Agreement is hereby amended in its entirety to read
as follows, effective July 3, 2007:
     (c) Vesting. The Initial Option Grant will vest and become exercisable
either (i) in a series of three successive equal annual installments upon the
Executive’s completion of each year of employment with the Company over the
three-year period measured from the Commencement Date (regardless of the actual
grant date) or (ii) as otherwise provided in Section 8(a), and that grant will
be subject to the vesting acceleration provisions set forth in Sections 8 and 11
of this Agreement. The shares of the Company’s Class A common stock underlying
the Initial RSU Award will vest, and those vested shares shall become issuable,
in accordance with the terms of the July 3, 2007 Restricted Stock Unit Award
Agreement between the Executive and the Company evidencing that award, as such
agreement may be amended or restated from time to time (the “Initial RSU Award
Agreement”), and such agreement shall incorporate the special vesting
accelerations provisions of Sections 8 and 11 of this Agreement.
     3. Section 6(a) of the Agreement is hereby amended in its entirety to read
as follows:
     (a) Expenses. Subject to applicable Company policies, including (without
limitation) the timely submission of appropriate documentation and expense
reports, the Executive will be entitled to receive prompt reimbursement of all
expenses reasonably incurred by him in connection with the performance of his
duties hereunder or for promoting, pursuing or otherwise furthering the business
or interests of the Company, including (without limitation) round trip first
class airfare to accommodate Executive’s commute to and from Chicago/Phoenix, at
such times as the Executive shall reasonably determine.

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Accordingly, the Executive shall submit appropriate evidence of each such
expense within sixty (60) days after the later or (i) his incurrence of that
expense or (ii) his receipt of the invoice or billing statement for such
expense, and the Company shall provide the Executive with the requisite
reimbursement within ten (10) business days thereafter; provided, however, that
(i) no expense shall be reimbursed later than the close of the calendar year
following the calendar year in which that expense is incurred, (ii) the amounts
eligible for reimbursement in any one calendar year shall not affect the amounts
reimbursable in any other calendar year and (iii) the right to such
reimbursement may not be liquidated or exchanged for any other benefit.
     In addition, and not in limitation of the foregoing, the Company shall
provide the Executive with a monthly allowance of $2,500 during the term of this
Agreement for the Executive’s Arizona housing, food and other similar expenses.
Each such monthly payment to the Executive shall be made no later than five
(5) business days after the end of the applicable month.
     4. Section 7(d) of the Agreement is hereby amended in its entirety to read
as follows:
          (d) Termination due to the Executive’s Death or Disability. This
Agreement will terminate upon the death of the Executive. The Company may
terminate the Executive’s employment hereunder if he is unable to perform, with
or without reasonable accommodation, the principal duties and responsibilities
of his position with the Company for a period of six (6) consecutive months or
more by reason of any physical or mental injury or impairment; provided,
however, that in the event the Executive is at the time covered under any
long-term disability benefit program in effect for the Company’s executive
officers or employees, such termination of the Executive’s employment shall not
occur until the earlier of (i) the date he first becomes eligible to receive
benefits under such program or (ii) the date he is deemed to have a Separation
from Service (as defined below) by reason of such disability. The termination of
the Executive’s employment under such circumstances shall, for purposes of this
Agreement, constitute a termination for “Disability.”
     5. Section 8 of the Agreement is hereby amended in its entirety to read as
follows:
     8. Compensation Upon Termination.
     (a) Except as provided further in this Section 8(a), if the Executive’s
employment is terminated: (i) by the Company for Cause; (ii) by reason of the
Executive’s death or Disability; (iii) pursuant to a Notice of Non-Renewal
delivered by the Executive; or (iv) by the Executive by delivery of a written
notice of resignation without Good Reason, the Company’s sole obligations
hereunder will be to pay the Executive or his estate on the Termination Date the
following amounts earned hereunder but not paid as of the Termination Date:
(i) Base Salary, (ii) reimbursement for any and all monies advanced or expenses
incurred pursuant to Section 6(a) through the Termination Date, provided the
Executive has submitted appropriate and timely

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documentation for such expenses, and (iii) the amount of the Executive’s accrued
but unpaid vacation time (together, these amounts will be referred to as the
“Accrued Obligations”). In addition to the Accrued Obligations, in the event the
Executive’s employment terminates by reason of the Executive’s death or
Disability, the Executive or his estate will be paid at that time his Target
Bonus, pro-rated for his actual period of service during the fiscal year in
which such termination of employment occurs. Should the Executive’s employment
terminate pursuant to a Notice of Non-Renewal delivered by the Executive, then
the Executive will become entitled to receive a pro-rated Annual Bonus for the
fiscal year in which such termination occurs, provided that any performance
goals upon which such Annual Bonus is conditioned are in fact attained. In the
event of such attainment, the pro-rated Annual Bonus to which the Executive
shall become entitled shall be determined by multiplying (aa) the actual Annual
Bonus he would have received based on the attained performance goals had he
continued in the Company’s employ until the payment date of that bonus by (bb) a
fraction, the numerator of which is the number of months (rounded to the next
whole month) during which the Executive is employed by the Company in the fiscal
year in which such termination of employment occurs and the denominator of which
is twelve (12). Such pro-rated Annual Bonus shall be paid to the Executive by
the fifteenth day of the third calendar month following the close of such fiscal
year, subject to any required holdback under Section 14(b). Furthermore, if the
Executive’s employment terminates as a result of his death or Disability, then
any unvested stock options, restricted stock, restricted stock units or other
equity awards granted to the Executive that would have otherwise been vested on
the date of such termination of employment had the vesting schedule for each of
those grants been in the form of successive equal monthly installments over the
applicable vesting period will immediately vest. The shares underlying any
restricted stock units or other equity-based awards to which the Executive
becomes entitled in accordance with the foregoing shall be issued at the time or
times set forth in the applicable agreements evidencing those awards, subject to
any required holdback under Section 14(b). The Executive’s entitlement to any
other benefits will be determined in accordance with the Company’s employee
benefit plans then in effect.
     (b) If the Executive’s employment is terminated: (i) by the Company for any
reason other than for Cause; (ii) by the Executive for Good Reason; or
(iii) pursuant to a Notice of Non-Renewal delivered by the Company, the
Executive will, in addition to the Accrued Obligations, be entitled to the
following compensation and benefits from the Company, provided and only if
(x) the Executive executes and delivers to the Company a general release
substantially in the form of attached Exhibit A (the “Required Release”) within
twenty-one (21) days (or forty-five (45) days if such longer period is required
under applicable law) after such termination of employment, (y) the Required
Release becomes effective and enforceable in accordance with applicable law and
(z) the Executive complies with the restrictive covenants set forth in
Section 10:
          (i) an amount equal to sum of (A) two times the Executive’s Base
Salary at the time of the Notice of Termination and (B) two times the average of
his actual Annual Bonuses for the three fiscal years (or fewer number of fiscal
years of employment with the Company) immediately preceding the

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fiscal year in which such termination of employment occurs (with any pro-rated
bonus for any such year to be annualized), with such amount to be paid in
successive equal increments, in accordance with the Company’s normal payroll
practices, over the one-year period measured from the date of the Executive’s
Separation from Service due to such termination of employment, beginning with
the first pay day within the sixty (60) day period following the date of such
Separation from Service on which the Required Release is effective following the
expiration of any applicable revocation period, but in no event later than the
last day of such sixty (60)-day period on which the Required Release is so
effective;
          (ii) accelerated vesting of the Initial Option Grant to the extent of
the greater of (A) fifty percent of the then unvested portion of each such grant
or (B) the portion of each such grant which would have vested had the Executive
completed an additional twelve (12) months of employment with the Company prior
to the Termination Date, and one hundred percent vesting of the Initial RSU
Award if such termination of employment occurs prior to the completion of the
performance period specified in the Initial RSU Award Agreement or on or after
the completion of that performance period in which the designated performance
goal is attained, with any shares which so vest under the Initial RSU Award to
be issued at the time or times set forth in the Initial RSU Award Agreement,
subject to any required holdback under Section 14(b);
          (iii) provided the Executive and/or his spouse and dependents are
eligible and timely elect to continue their health care coverage under the
Company’s group health plan pursuant to their rights under COBRA, the Company
will reimburse the Executive for the costs he incurs to obtain such continued
coverage for himself and his spouse and eligible dependents (collectively, the
“Coverage Costs”) until the earliest of (A) the end of the eighteen (18)-month
period measured from the Termination Date, (B) the date that the Executive
and/or his eligible dependents are no longer eligible for COBRA coverage and
(C) the date that the Executive becomes eligible for such coverage under the
health plan of any new employer (the Executive agrees to provide the Company
with written notice of such eligibility within ten calendar days). In order to
obtain reimbursement for such Coverage Costs, Executive must submit appropriate
evidence to the Company of each periodic payment within sixty (60) days after
the required payment date for those Coverage Costs, and the Company shall within
thirty (30) days after such submission reimburse the Executive for that payment.
During the period such medical care coverage remains in effect hereunder, the
following provisions shall govern the arrangement: (a) the amount of Coverage
Costs eligible for reimbursement in any one calendar year of such coverage shall
not affect the amount of Coverage Costs eligible for reimbursement in any other
calendar year for which such reimbursement is to be provided hereunder; (ii) no
Coverage Costs shall be reimbursed after the close of the calendar year
following the calendar year in which those Coverage Costs were incurred; and
(iii) the Executive’s right to the

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reimbursement of such Coverage Costs cannot be liquidated or exchanged for any
other benefit. To the extent the reimbursed Coverage Costs constitute taxable
income to the Executive, the Company shall report the reimbursement as taxable
W-2 wages and collect the applicable withholding taxes, and any remaining tax
liability shall be the Executive’s sole responsibility; and
          (iv) the Executive’s entitlement to any other benefits will be
determined in accordance with the Company’s employee benefit plans then in
effect.
     (c) The Executive shall have the right to resign, for any reason or no
reason, at any time within the thirty (30) day period beginning six (6) months
after the closing of a Change in Control (as defined in Section 11) and to
receive, in connection with such resignation, the same severance benefits to
which he would be entitled under Section 8(b) above had such resignation been
for Good Reason; provided, however, that the Executive’s entitlement to
severance benefits under this Section 8(c) shall be conditioned upon the
satisfaction of each of the following requirements: (i) the Executive executes
and delivers to the Company the Required Release within twenty-one (21) days (or
forty-five (45) days if such longer period is required under applicable law)
after such resignation, (ii) the Required Release becomes effective and
enforceable in accordance with applicable law and (iii) the Executive complies
with the restrictive covenants set forth in Section 10 of this Agreement.
     (d) All payments and benefits under this Section 8 shall be subject to the
applicable holdback provisions of Section 14(b).
     (e) The Executive will not be required to mitigate the amount of any
payment provided for in this Section 8 by seeking other employment or otherwise,
and no such payment or benefit will be eliminated, offset or reduced by the
amount of any compensation provided to the Executive in any subsequent
employment.
     (f) The exercise period with respect to the Initial Option Grant shall not
be accelerated upon the Executive’s termination of employment for any reason.
     6. Section 12(b) of the Agreement is hereby deleted in its entirety and
replaced with the following new Sections 12(b), 12(c), 12(d) and 12(e):
     (b) All determinations as to whether any of the Total Payments are
“parachute payments” (within the meaning of Section 280G of the Code), whether a
Gross-Up Payment is required, the amount of such Gross-Up Payment, and any
amounts relevant to the last sentence of the paragraph above, will be made by an
independent registered public accounting firm selected by the Company from among
the largest four such accounting firms in the United States (the

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“Accounting Firm”). The Accounting Firm selected by the Company will not have an
ongoing audit or consulting relationship with the Company at the time it is
selected.  The Accounting Firm will provide all applicable determinations with
respect to any of the Total Payments that become due and payable at the time of
the Change in Control Event (the “Change in Control Determination”), together
with detailed supporting calculations regarding the amount of the Excise Tax,
any required Gross-Up Payment and any other relevant matter, both to the Company
and the Executive within ten (10) business days after the effective date of the
Change in Control Event or such earlier time as is requested by the Company
or the Executive (if the Executive reasonably believes that any of the Total
Payments may be subject to the Excise Tax). In addition, the Accounting Firm
will provide all applicable determinations with respect to any of the Total
Payments that become due and payable at the time of the Executive’s Separation
from Service (the “Separation from Service Determination”), together
with detailed supporting calculations regarding the amount of the Excise Tax,
any required Gross-Up Payment and any other relevant matter, both to the Company
and the Executive within ten (10) business days after the date of the
Executive’s Separation from Service. The Change in Control and Separation from
Service Determinations made by the Accounting Firm will be binding upon the
Company and the Executive. The Gross-Up Payment (if any) determined on the basis
of the Change in Control Determination shall be paid to or on behalf of
Executive within five (5) business days after the completion of such
Determination or (if later) at the time the related Excise Tax is remitted to
the appropriate tax authorities. The Gross-Up Payment (if any) determined on the
basis of the Separation from Service Determination shall be paid to or on behalf
of Executive within five (5) business days after the completion of such
Determination or (if later) at the time the related Excise Tax is remitted to
the appropriate tax authorities.
     (c) In the event that the Executive’s actual Excise Tax liability is
determined by a Final Determination to be greater than the Excise Tax liability
taken into account for purposes of any Gross-Up Payment or Payments initially
made to the Executive pursuant to the provisions of Section 12(b), then within
thirty (30) days following that Final Determination, the Executive shall notify
the Company of such determination, and the Accounting Firm shall, within thirty
(30) days thereafter, make a new Excise Tax calculation based upon that Final
Determination and provide the Company and the Executive with the supporting
calculations for any supplemental Gross-Up Payment attributable to that excess
Excise Tax liability. The Company shall make the supplemental Gross-Up payment
to the Executive within five (5) business days following the completion of the
applicable calculations or (if later) at the time such excess tax liability is
remitted to the appropriate tax authorities. In the event that the Executive’s
actual Excise Tax liability is determined by a Final Determination to be less
than the Excise Tax liability taken into account for purposes of any Gross-Up
Payment or Payments initially made to the Executive pursuant to the provisions
of

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Section 12(b), then the Executive shall refund to the Company, within five (5)
business following receipt, any federal or state tax refund attributable to the
Excise Tax overpayment. For purposes of this Section 12(c), a “Final
Determination” means an audit adjustment by the Internal Revenue Service that is
either (i) agreed to by both the Executive and the Company (such agreement by
the Company to be not unreasonably withheld) or (ii) sustained by a court of
competent jurisdiction in a decision with which the Executive and the Company
concur or with respect to which the period within which an appeal may be filed
has lapsed without a notice of appeal being filed.
     (d) Should the Accounting Firm determine that any Gross-Up Payment made to
the Executive was in fact more than the amount actually required to be paid to
him in accordance with the provisions of Section 12(b) or 12(c), then
the Executive will, at the direction and expense of the Company, take such steps
as are reasonably necessary (including the filing of returns and claims for
refund), follow reasonable instructions from, and procedures established by, the
Company, and otherwise reasonably cooperate with the Company to correct such
overpayment. In addition, should the Company decide to contest any assessment by
the Internal Revenue Service of an Excise Tax on one or more items comprising
the Total Payments, the Executive will comply with all reasonable actions
requested by the Company in connection with such proceedings, but shall not be
required to incur any out-of-pocket costs in so doing.
     (e) Notwithstanding anything to the contrary in the foregoing, any Gross-Up
Payments due the Executive under this Section 12 shall be subject to the
hold-back provisions of Section 14(b), to the extent those payments relate to
any amounts and benefits provided to the Executive that constitute parachute
payments attributable to his Separation from Service. In addition, no Gross-Up
Payment shall be made later than the later of (i) the end of the calendar year
in which the related taxes are remitted to the appropriate tax authorities or
(ii) the end of the sixty (60)-day period measured from the date those taxes are
so remitted, or such other specified time or schedule that may be permitted
under Section 409A of the Code. To the extent the Executive may become entitled
to any reimbursement of expenses incurred by him at the direction of the Company
in connection with any tax audit or litigation addressing the existence or
amount of the Excise Tax, such reimbursement shall be paid to the Executive no
later than the later of (i) the close of the calendar year in which the Excise
Tax that is the subject of such audit or litigation is paid by or on behalf of
the Executive or (ii) the end of the sixty (60)-day period measured from such
payment date. If no Excise Tax liability is found to be due as a result of such
audit or litigation, the reimbursement shall be paid to the Executive no later
than the later of (i) the close of the calendar year in which the audit is
completed or there is a final and non-appealable settlement or other resolution
of the litigation or (ii) the end of the sixty (60)-day period measured from the
date the audit is completed or the date the litigation is so settled or
resolved.

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     7. The final paragraph of Section 13(a) is hereby amended to read as
follows:
     All determinations under this Section 13 shall be made by the Accounting
Firm. However, in determining whether such Benefit Limit is exceeded, the
Accounting Firm shall make a reasonable determination of the value to be
assigned to the restrictive covenants in effect for the Executive pursuant to
Section 10 of the Agreement, and the amount of his potential parachute payment
under Code Section 280G shall be reduced by the value of those restrictive
covenants to the extent consistent with Code Section 280G and the regulations
thereunder. To the extent a reduction to the Total Payments is required to be
made in accordance with this Section 13, the Total Payments attributable to any
cash severance payments otherwise due the Executive under Section 8 shall be
reduced first (with such reduction to be applied pro-rata to each such severance
payment and without any change in the payment dates), then the accelerated
vesting of his Initial RSU Award shall be reduced, then the accelerated vesting
of any other restricted stock unit awards made to him by the Company shall be
reduced in the same chronological order in which granted, and finally the
accelerated vesting of the Executive’s stock options shall be reduced (based on
the amount of the parachute payment calculated for each such option in
accordance with the Treasury Regulations under Code Section 280G), with such
reduction to occur in the same chronological order in which those options were
granted.
     8. There is hereby added to the end of Section 14(a) of the Agreement the
following sentence:
     To the extent there is any ambiguity as to whether any provision of this
Agreement would otherwise contravene one or more requirements or limitations of
Code Section 409A, such provisions shall be interpreted and applied in a manner
that does not result in a violation of the applicable requirements or
limitations of Code Section 409A and the Treasury Regulations thereunder.
     9. Section 14(b) of the Agreement is hereby amended in its entirety to read
as follows:
     (b) Notwithstanding any provision to the contrary in this Agreement, no
payments or benefits to which the Executive becomes entitled under this
Agreement in connection with his termination of employment with the Company
(other than the reimbursement of Coverage Costs during the applicable period of
COBRA coverage) shall be made or paid to the Executive prior to the earlier of
(i) the first day of the seventh (7th) month following the date of his
Separation from Service due to such termination of employment or (ii) the date
of his death, if the Executive is deemed, pursuant to the procedures established
by the Compensation Committee of the Company’s Board of Directors in accordance
with the applicable standards of Code Section 409A and the Treasury Regulations
thereunder and applied on a consistent basis for all for all non-qualified
deferred compensation plans of the Employer Group subject to Code Section 409A,
to be a

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“specified employee” at the time of such Separation from Service and such
delayed commencement is otherwise required in order to avoid a prohibited
distribution under Code Section 409A(a)(2). Upon the expiration of the
applicable deferral period, all payments deferred pursuant to this Section 14(b)
shall be paid to the Executive in a lump sum, and any remaining payments due
under this Agreement shall be paid in accordance with the normal payment dates
specified for them herein. The specified employees subject to such a delayed
commencement date shall be identified on December 31 of each calendar year. If
the Executive is so identified on any such December 31, he shall have specified
employee status for the twelve (12)-month period beginning on April 1 of the
following calendar year. For purposes of this Agreement, including (without
limitation) this Section 14(b), the following definitions shall be in effect:
          (i) “Separation from Service” shall mean the date on which the level
of the Executive’s bona fide services as an Employee (or non-employee
consultant) permanently decreases to a level that is not more than twenty
percent (20%) of the average level of services the Executive rendered as an
Employee or non-employee consultant during the immediately preceding thirty-six
(36) months (or any shorter period of such service). Any such determination,
however, shall be made in accordance with the applicable standards of the
Treasury Regulations issued under Code Section 409A. In addition to the
foregoing, a Separation from Service will not be deemed to have occurred while
the Executive is on a sick leave or other bona fide leave of absence if the
period of such leave does not exceed six (6) months or any longer period for
which the Executive’s right to reemployment with the Company is provided either
by statute or contract; provided, however, that in the event of a leave of
absence due to any medically determinable physical or mental impairment that can
be expected to result in death or to last for a continuous period of not less
than six (6) months and that causes the Executive to be unable to perform his
duties as an Employee, no Separation from Service shall be deemed to occur
during the first twenty-nine (29) months of such leave. If the period of the
leave exceeds six (6) months (or twenty-nine (29) months in the event of
disability as indicated above) and the Executive’s right to reemployment is not
provided either by statute or contract, then the Executive will be deemed to
have Separated from Service on the first day immediately following the
expiration of the applicable six (6)-month or twenty-nine (29)-month period.
          (ii) The Executive shall be deemed to remain an “Employee” for so long
he remains in the employ of at least one member of the Employer Group, 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.
          (iii) “Employer Group” shall mean the Company and each member of the
group of commonly controlled corporations or other businesses that include the
Company, as determined in accordance with Sections 414(b) and (c) of the Code
and the Treasury Regulations thereunder, except that in applying

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Sections 1563(1), (2) and (3) of the Code for purposes of determining the
controlled group of corporations under Section 414(b), the phrase “at least 50
percent” shall be used instead of “at least 80 percent” each place the latter
phrase appears in such sections and in applying Section 1.414(c)-2 of the
Treasury Regulations for purposes of determining trades or businesses that are
under common control for purposes of Section 414(c), the phrase “at least
50 percent” shall be used instead of “at least 80 percent” each place the latter
phrase appears in Section 1.414(c)-2 of the Treasury Regulations.
     10. Section 14(c) of the Agreement is hereby amended in its entirety to
read as follows:
     (c) Should the Executive comply with the provisions of subsections 14(a)
and 14(b) above but nevertheless incur the 20% penalty tax imposed under
Section 409A (the “Section 409A Penalty Tax”) with respect to one or more
payments or benefits provided to him under this Agreement, then the Executive
will be entitled to receive an additional payment (the “409A Gross-Up Payment”)
in an amount such that after payment by the Executive of all taxes (including
any interest or penalties imposed with respect to such taxes), including any tax
imposed upon the 409A Gross-Up Payment, the Executive retains an amount of the
409A Gross-Up Payment equal to the Section 409A Penalty Tax imposed upon the
Executive’s deferred compensation. The amount of the 409A Gross-Up Payment shall
be calculated, by an Accounting Firm mutually agreeable to the Company and the
Executive, within ten (10) business days after it is first determined that the
Executive is subject to the Section 409A Penalty Tax, and the 409A Gross-Up
Payment so calculated shall be paid to or on behalf of the Executive within five
(5) business days after the completion of such determination or (if later) at
the time the related Section 409A Penalty Tax is remitted to the appropriate tax
authorities. In the event that the Executive’s actual Section 409A Penalty Tax
liability is determined by a Final Determination to be greater than the
Section 409A Penalty Tax liability taken into account for purposes of the 409A
Gross-Up Payment initially made to the Executive pursuant to the provisions of
this Section 14(c), then within thirty (30) days following that Final
Determination, the Executive shall notify the Company of such determination, and
the Accounting Firm shall, within thirty (30) days thereafter, make a new
calculation of the 409A Gross-Up Payment based upon that Final Determination and
provide the Company and the Executive with the supporting calculations for any
supplemental 409A Gross-Up Payment attributable to that excess Section 409A
Penalty Tax liability. The Company shall make the supplemental 409A Gross-Up
payment to the Executive within five (5) business days following the completion
of the applicable calculations or (if later) at the time such excess
Section 409A Penalty Tax liability is remitted to the appropriate tax
authorities. In the event that the Executive’s actual Section 409A Penalty Tax
liability is determined by a Final Determination to be less than the
Section 409A Penalty Tax liability taken into account for purposes of the 409A
Gross-Up

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Payment initially made to the Executive pursuant to the provisions of this
Section 14(c), then the Executive shall refund to the Company, within five (5)
business days after receipt, any federal or state tax refund attributable to the
overpayment of his Section 409A Penalty Tax. In no event shall any 409A Gross-Up
Payment to which the Executive becomes entitled hereunder be made later than the
later of (i) the end of the calendar year in which the related Section 409A
Penalty Tax is remitted to the appropriate tax authorities or (ii) the end of
the sixty (60)-day period measured from the date such tax is so remitted.
     11. Except as modified by this Amendment No. 2, all the terms and
provisions of the Agreement (as previously amended) shall continue in full force
and effect.
IN WITNESS WHEREOF, Apollo Group, Inc. has caused this Amendment No. 2 to be
executed on its behalf by its duly-authorized officer on the date indicated
below, and the Executive has executed this Amendment No. 2 on the date indicated
below.

                  JOSEPH L. D’AMICO       APOLLO GROUP, INC.    
 
               
/s/ Joseph L. D’Amico
 

Dated: DEC 12, 2008
      By:

Title: /s/ Charles B. Edelstein
 

Chief Executive Officer
 
   
 
     
Dated:  
Dec 12, 2008    

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