Document:

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APOLLO GROUP, INC.

RESTRICTED STOCK UNIT 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 Restricted Stock Units. The Corporation hereby awards to Participant, as
of the Award Date, restricted stock units under the Plan. The number of shares of Class A Common
Stock underlying the awarded restricted stock units and the applicable performance vesting
requirement for those units and the underlying shares are set forth in the Award Summary below. The
remaining terms and conditions governing the Award, including the applicable service vesting
requirements, are set forth in the remainder of this Agreement.

AWARD SUMMARY

	 	 	 
	Participant

	 	                                                                                                                                                                                                                                                                    
	 
	 	 
	Award Date:

	 	                                                                      , 200                    
	 
	 	 
	Number of Shares
Subject to Award:

	 	                                         shares of Class A Common Stock (the “Shares”)
	 
	 	 
	Vesting Provisions:

	 	Performance Vesting: None of the Shares subject to this
Award shall vest, and this Award shall terminate in its
entirety, should the Corporation fail to attain the
Performance Goal specified in attached Schedule I for the
applicable Performance Period.
	 
	 	 
	 

	 	Service Vesting: If such Performance Goal is attained, then
the number of Shares in which Participant may vest
hereunder shall be determined in accordance with the
service vesting provisions of Paragraph 3.
	 
	 	 
	 

	 	Accelerated Vesting: The Shares subject to this Award shall
be subject to accelerated vesting pursuant to the
provisions of Paragraph 5.

 

 

     2. Limited Transferability. Prior to the actual issuance of the Shares which vest
hereunder, Participant may not transfer any interest in the restricted stock units subject to the
Award or the underlying Shares or pledge or otherwise hedge the sale of those units or Shares,
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 those Shares. However, any Shares 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 designee.

     3. Vesting Requirements. The Shares subject to the Award shall initially be unvested
and shall vest only in accordance with the vesting provisions of this Paragraph 3 or the special
vesting acceleration provisions of Paragraph 5. The actual number of Shares in which Participant
shall vest under this Paragraph 3 shall be determined as follows:

          (a) Performance Vesting: As soon as administratively practicable following the completion of
the Performance Period, the Plan Administrator shall, on the basis of the Corporation’s audited
financial statements for the fiscal year coincident with such Performance Period, determine whether
the Performance Goal for that period has been attained. If the Performance Goal has not been
attained, then the restricted stock units hereby awarded shall be immediately cancelled, and
Participant shall thereupon cease to have any right or entitlement to receive any of the Shares
underlying those cancelled units. Should the Plan Administrator determine and certify, on the
basis of such audited financial statements, that the Performance Goal for the Performance Period
has been attained, then the Shares subject to this Award shall be re-designated as Performance
Shares, and the number of those Performance Shares in which Participant may vest shall be dependent
upon his or her completion of the Service vesting requirements set forth below.

          (b) Service Vesting: The Participant shall vest in twenty-five percent (25%) of the
Performance Shares upon his or her continuation in Employee status through the completion of the
Performance Period. Participant shall vest in the remaining Performance Shares upon his or her
completion of each successive twelve (12)-month period of continued Service over the thirty-six
(36)-month period measured from                                         , 200          .

          (c) Cessation of Service. In no event shall Participant vest in any additional Performance
Shares following his or her cessation of Service. Accordingly, should Participant cease Service
for any reason prior to vesting in one or more Shares subject to this Award, then the Award will be
immediately cancelled with respect to those unvested Shares, and the number of restricted stock
units will be reduced accordingly. Participant shall thereupon cease to have any right or
entitlement to receive any Shares under those cancelled units, and those Shares shall cease to be
subject to this Award.

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     4. Stockholder Rights and Dividend Equivalents

          (a) The holder of this Award shall not have any stockholder rights, including voting, dividend
or liquidation rights, with respect to the Shares subject to the Award until Participant becomes
the record holder of those Shares following their actual issuance upon the Corporation’s collection
of the applicable Withholding Taxes.

          (b) Notwithstanding the foregoing, should any dividend or other distribution payable other
than in shares of Class A Common Stock, whether regular or extraordinary, be declared and paid on
the Corporation’s outstanding Class A Common Stock in one or more calendar years during which
Shares remain subject to this Award (i.e., those Shares are not otherwise issued and outstanding
for purposes of entitlement to the dividend or distribution), then a special book account shall be
established for Participant and credited with a phantom dividend equivalent to the actual dividend
or distribution which would have been paid on the Shares had such Shares been issued and
outstanding and entitled to that dividend or distribution. As the Shares subsequently vest in one
or more installments hereunder, the phantom dividend equivalents credited to those Shares in the
book account shall be distributed to Participant (in cash or such other form as the Plan
Administrator may deem appropriate in its sole discretion) concurrently with the issuance of the
vested Shares to which those phantom dividend equivalents relate. However, each such distribution
shall be subject to the Corporation’s collection of the Withholding Taxes applicable to that
distribution.

     5. Change in Control. Should a Change in Control be effected at a time when one or
more unvested Shares remain subject to this Award, then Participant shall, immediately prior to the
closing of that Change in Control transaction, vest in all those unvested Shares. The Shares so
vested shall be issued immediately on the effective date of such Change in Control or as soon as
administratively practicable thereafter, but in no event more than fifteen (15) business days after
such effective date, or shall otherwise be converted into the right to receive the same
consideration per share of Class A Common Stock payable to the other holders of such Class A Common
Stock in consummation of the Change in Control and distributed at the same time as such stockholder
payments, but in no event shall such distribution to Participant be completed later than the later
of (i) the end 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. Each issuance or distribution made under this Paragraph 5 shall be subject to the
Corporation’s collection of the applicable Withholding Taxes. 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 Class A Common Stock as a class without the Corporation’s receipt of consideration, or
should the value of outstanding shares of Class A 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 and thereby prevent a
dilution or enlargement of benefits hereunder. In making such equitable adjustments, the Plan
Administrator shall take into account any amounts credited to Participant’s book account under
Paragraph 4(b) in connection with the transaction, and the determination of the Plan Administrator
shall be final, binding and conclusive. However, in the event of a Change of Control, the
adjustments (if any) shall be made in accordance with the applicable provisions of Section 13.8 of
the Plan governing Change of Control transactions. Notwithstanding the above, the conversion of any
convertible securities of the Corporation shall not be deemed to have been effected without the
Corporation’s receipt of consideration.

     7. Issuance of Shares of Common Stock.

          (a) The Performance Shares in which Participant vests in accordance with the provisions of
Paragraph 3 shall be issued in accordance with the following provisions:

          (i) The first twenty-five percent (25%) of the Performance Shares shall be
issued as soon as administratively practicable following the Plan Administrator’s
determination and certification, based on the Corporation’s audited financial
statements for the fiscal year coincident with the Performance Period, that the
Performance Goal for that period has been attained. The Performance Shares subject
to each subsequent installment in which Participant vests on the basis of his or her
continued Service shall be issued as soon as administratively practicable following
the applicable vesting date for that installment. In no event shall any Performance
Shares which vest in accordance with Paragraph 3 be issued later than the later of
(A) the last day of the calendar year in which the particular
vesting date for those shares occurs or (B the fifteenth (15th) day of third (3rd) calendar month following
such vesting date. The phantom dividend equivalents credited to the Participant’s
book account under Paragraph 4(b) shall be distributed concurrently with the
issuance of the vested Performance Shares to which they relate.

          (ii) Except as otherwise provided in Paragraph 5, no Shares shall be issued
prior to the completion of the Performance Period.

          (b) The Corporation shall collect the Withholding Taxes with respect to each distribution of
phantom dividend equivalents by withholding a portion of that distribution equal to the amount of
the applicable Withholding Taxes, with the cash portion of the distribution to be the first portion
so withheld.

          (c) The Corporation shall collect the applicable Withholding Taxes with respect to all Shares
which vest pursuant to the provisions of this Agreement through the following automatic share
withholding method:

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          - On the applicable issuance date, the Corporation shall withhold, from the
vested Shares otherwise issuable to 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 which
the Corporation shall be required to so withhold shall not exceed in Fair Market
Value 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.

          (d) Except as otherwise provided in Paragraph 5 or this Paragraph 7, the settlement of all
restricted stock units which vest under the Award shall be made solely in shares of Common Stock.
In no event, however, shall any fractional shares be issued. Accordingly, the total number of
shares of Common Stock to be issued at the time the Award vests shall, to the extent necessary, be
rounded down to the next whole share in order to avoid the issuance of a fractional share.

     8. 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 Common Stock may be listed for trading at the time of such issuance.

     9. 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. Any notice required to be given or delivered to Participant shall be in writing
and addressed to Participant at the most recent address then on file for 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.

     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 Participant and the legal representatives, heirs and
legatees of Participant’s estate and any beneficiaries of the Award designated by Participant.

     11. 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.

     12. 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.

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     IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first
indicated above.

	 	 	 	 	 	 	 
	 	 	APOLLO GROUP, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 	 	PARTICIPANT	 	 
	 
	 	 	 	 	 	 
	 

	 	Signature:	 	 	 	 
	 

	 	 	 	 

	 	 

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APPENDIX A

 DEFINITIONS

     The following definitions shall be in effect under the Agreement:

     A. Agreement shall mean this Restricted Stock Unit Issuance Agreement.

     B. Award shall mean the award of restricted stock units made to Participant pursuant
to the terms of this Agreement.

     C. Award Date shall mean the date the restricted stock units are awarded to
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. Change in Control shall have the meaning assigned to such term in Section 3.1(e) of
the Plan.

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

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

     H. 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.

     I. 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.

     J. 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.

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

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

     M. 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.

     N. Performance Goal shall mean the performance goal specified in Schedule I to this
Agreement.

     O. Performance Period shall mean the period specified on attached Schedule I to this
Agreement over which the attainment of the Performance Goal is to be measured.

     P. Performance Shares shall mean the Shares in which Participant can vest under this
Agreement if the Performance Goal is attained.

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

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

     S. 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 renders 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.

     T. Shares shall mean the shares of Class A Common Stock which may vest and become
issuable under the Award pursuant to the terms of this Agreement.

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

A-2

 

     V. 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.

     W. 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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SCHEDULE I

PERFORMANCE PERIOD AND PERFORMANCE GOALexv10w10

 

APOLLO GROUP, INC.

STOCK OPTION AGREEMENT

RECITALS

     A. The Corporation has implemented the Incentive Plan for the purpose of providing eligible
persons in the Corporation’s service with the opportunity to receive one or more equity incentive
awards designed to encourage them to continue their service relationship with the Corporation.

     B. Optionee is to render valuable services to the Corporation, and this Agreement is executed
pursuant to, and is intended to carry out the purposes of, the Incentive Plan in connection with
the Corporation’s grant of an option to Optionee as an additional inducement to perform those
services.

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

          NOW, THEREFORE, it is hereby agreed as follows:

          1. Grant of Option. Pursuant to the terms of Section 4 of the Employment Agreement,
the Corporation hereby grants to Optionee on May 25, 2007 (the“Grant Date”) a Non-Statutory Option
to purchase 1,000,000 shares of the Corporation’s Class A Common Stock (the “Option Shares”) at an
exercise price of $48.47 per share (the “Exercise Price”), the closing price per share of such
Class A Common Stock on the Nasdaq Global Select Market on the Grant Date.

          2. Option Term. The term of this option shall commence on the Grant Date and continue
in effect until the close of business on May 24, 2013 (the “Expiration Date”), unless sooner
terminated in accordance with Paragraph 5 or 6.

          3. Limited Transferability. This option shall be neither transferable nor assignable
by Optionee other than by will or the laws of inheritance following Optionee’s death and shall be
subject to the transfer restrictions set forth in Section 13.5 of the Incentive Plan. This option
may be exercised, during Optionee’s lifetime, only by Optionee. However, Optionee may designate
one or more persons as the beneficiary or beneficiaries of this option, and this option shall, in
accordance with such designation, automatically be transferred to such beneficiary or beneficiaries
upon the Optionee’s death while holding this option. Such beneficiary or beneficiaries shall take
the transferred option subject to all the terms and conditions of this Agreement, including
(without limitation) the limited time period during which this option may, pursuant to Paragraph 5,
be exercised following Optionee’s death.

          4. Dates of Exercise. This option shall become exercisable for the Option Shares in a
series of four (4) successive equal annual installments upon Optionee’s completion of each
successive year of Service over the four (4) year period measured from April 2, 2007 (the

 

 

“Vesting Commencement Date”). The foregoing four (4)-year installment vesting provision shall
constitute the Vesting Schedule for this option. However, this option may vest and become
exercisable in whole or in part on an accelerated basis in accordance with the special vesting
acceleration provisions of Paragraph 5 or Paragraph 6. As the option becomes exercisable for one or
more installments, those installments shall accumulate, and the option shall remain exercisable for
the accumulated installments until the Expiration Date or sooner termination of the option term
under Paragraph 5 or 6.

          5. Cessation of Service. The option term specified in Paragraph 2 shall terminate
(and this option shall cease to be outstanding) prior to the Expiration Date should any of the
following provisions become applicable:

               (a) Except as otherwise expressly provided in subparagraphs (b) through (e) of this Paragraph
5, should Optionee cease to remain in Service for any reason while this option is outstanding,
then Optionee shall have a three (3)-month period measured from the date of such cessation of
Service during which to exercise this option for any or all of the Option Shares for this option is
vested and exercisable at the time of Optionee’s cessation of Service, but in no event shall this
option be exercisable at any time after the Expiration Date.

               (b) Should Optionee’s Service terminate by reason of his death, then this option, to the
extent outstanding at that time but not otherwise vested and exercisable for all the Option Shares,
shall immediately vest and become exercisable for that number of additional Option Shares in which
Optionee would have otherwise been vested under this option at the time of his death had this
option vested in a series of forty-eight (48) successive equal monthly installments over the four
(4)-year period measured from the Vesting Commencement Date. Upon Optionee’s death (whether before
or after termination of Service) this option may be exercised, for any or all of the Option Shares
for which this option is vested and exercisable at the time of Optionee’s cessation of Service
(including any Option Shares which vest on an accelerated basis should such cessation of Service
occur by reason of Optionee’s death), by (i) the personal representative of Optionee’s estate or
(ii) the person or persons to whom the option is transferred pursuant to Optionee’s will or the
laws of inheritance following Optionee’s death, as the case may be. However, if Optionee dies while
holding this option and has an effective beneficiary designation in effect for this option at the
time of his death, then the designated beneficiary or beneficiaries shall have the exclusive right
to exercise this option following Optionee’s death. Any such right to exercise this option shall
lapse, and this option shall cease to be outstanding, upon the earlier of (i) the expiration of the
twelve (12)-month period measured from the date of Optionee’s death or (ii) the Expiration Date.
Upon the expiration of such limited exercise period or (if earlier) upon the Expiration Date, this
option shall terminate and cease to be outstanding for any exercisable Option Shares for which the
option has not otherwise been exercised.

               (c) Should Optionee cease Service by reason of Permanent Disability while this option is
outstanding, then Optionee shall have a twelve (12)-month period measured from the date of such
cessation of Service during which to exercise this option. In no event, however, shall this option
be exercisable at any time after the Expiration Date. Upon the

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expiration of such limited exercise period or (if earlier) upon the Expiration Date, this
option shall terminate and cease to be outstanding for any exercisable Option Shares for which the
option has not otherwise been exercised.

               (d) Should (i) Optionee’s Service be terminated by the Corporation other than for Cause or by
Optionee for Good Reason, or should the Corporation deliver a Notice of Non-Renewal (as defined in
Section 1 of the Employment Agreement) to Optionee, and (ii) Optionee deliver to the Corporation an
effective general release in accordance with Section 8(b) of the Employment Agreement, then this
option, to the extent outstanding at that time but not otherwise vested and exercisable for all the
Option Shares, shall immediately vest and become exercisable for that number of additional Option
Shares equal to the greater of (i) fifty percent (50%) of the Option Shares for which this option
is not otherwise at the time of such termination vested and exercisable in accordance with the
Vesting Schedule specified in Paragraph 2 or (ii) the number of additional Option Shares for which
this option would have otherwise been vested and exercisable in accordance with such Vesting
Scheduled had Optionee completed an additional twelve (12) months of Service prior to such
termination date.

               (e) The applicable period of post-Service exercisability in effect pursuant to the foregoing
provisions of this Paragraph 5 shall automatically be extended by an additional period of time
equal in duration to any interval within such post-Service exercise period during which the
exercise of this option or the immediate sale of the Option Shares acquired under this option
cannot be effected in compliance with applicable federal and state securities laws, but in no event
shall such an extension result in the continuation of this option beyond the Expiration Date.

               (f) Should Optionee’s Service be terminated for Cause, then this option, whether or not vested
and exercisable, shall terminate immediately and cease to be outstanding.

               (g) During the limited period of post-Service exercisability, this option may not be exercised
in the aggregate for more than the number of Option Shares for which this option is, at the time of
Optionee’s cessation of Service, vested and exercisable pursuant to the Vesting Schedule specified
in Paragraph 2 or the special vesting acceleration provisions of Paragraph 5(b) or 5(d) above or
Paragraph 6. This option shall not vest or become exercisable for any additional Option Shares,
whether pursuant to the normal Vesting Schedule specified in Paragraph 2 or the special vesting
acceleration provisions of Paragraph 6, following the Optionee’s cessation of Service. Upon the
expiration of such limited exercise period or (if earlier) upon the Expiration Date, this option
shall terminate and cease to be outstanding for any exercisable Option Shares for which the option
has not otherwise been exercised.

          6. Special Acceleration of Option.

               (a) This option, to the extent outstanding at the time of an actual Change in Control but not
otherwise fully exercisable, shall automatically accelerate so that this option shall, immediately
prior to the effective date of such Change in Control, become exercisable for all of the Option
Shares at the time subject to this option and may be exercised for any or all of those Option
Shares as fully vested shares of Class A Common Stock.

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               (b) Immediately following the Change in Control, this option shall terminate and cease to be
outstanding, except to the extent assumed by the successor corporation (or parent thereof) or
otherwise continued in effect pursuant to the terms of the Change in Control transaction.

               (c) If this option is assumed in connection with a Change in Control or otherwise continued in
effect, then this option shall be appropriately adjusted, immediately after such Change in Control,
to apply to the number and class of securities into which the shares of Class A Common Stock
subject to this option would have been converted in consummation of such Change in Control had
those shares actually been outstanding at the time. Appropriate adjustments shall also be made to
the Exercise Price, provided the aggregate Exercise Price shall remain the same. To the extent the
actual holders of the Corporation’s outstanding Class A Common Stock receive cash consideration for
their Common Stock in consummation of the Change in Control, the successor corporation may, in
connection with the assumption or continuation of this option, substitute one or more shares of its
own common stock with a fair market value equivalent to the cash consideration paid per share of
Common Stock in such Change in Control, provided such common stock is readily tradable on an
established U.S. securities exchange or market.

               (d) 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.

          7. Adjustment in Option 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 Class A Common Stock as a class without the Corporation’s receipt of consideration, or
should the value of outstanding shares of Class 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 equitable adjustments shall be made by the Plan
Administrator to (i) the total number and/or class of securities subject to this option and (ii)
the Exercise Price. The adjustments shall be made in such manner as the Plan Administrator deems
appropriate in order to reflect such change and thereby prevent the dilution or enlargement of
benefits hereunder, and those adjustments shall be final, binding and conclusive upon Optionee and
any other person or persons having an interest in the option. In the event of any Change in Control
transaction, the adjustment provisions of Paragraph 6(c) shall be controlling.

          8. Stockholder Rights. The holder of this option shall not have any stockholder
rights with respect to the Option Shares until such person shall have exercised the option, paid
the Exercise Price and become a holder of record of the purchased shares.

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          9. Manner of Exercising Option.

               (a) In order to exercise this option with respect to all or any part of the Option Shares for
which this option is at the time exercisable, Optionee (or any other person or persons exercising
the option) must take the following actions:

               (i) Execute and deliver to the Corporation a Notice of Exercise as to the
Option Shares for which the option is exercised or comply with such other procedures
as the Corporation may establish for notifying the Corporation of the exercise of
this option for one or more Option Shares.

               (ii) Pay the aggregate Exercise Price for the purchased shares in one or more
of the following forms:

               (A) cash or check made payable to the Corporation;

               (B) shares of Class A Common Stock (whether delivered in the form of
actual stock certificates or through attestation of ownership in a manner
reasonably satisfactory to the Corporation) held for the requisite period
(if any) necessary to avoid any resulting charge to the Corporation’s
earnings for financial reporting purposes and valued at Fair Market Value on
the Exercise Date; or

               (C) through a special sale and remittance procedure pursuant to which
Optionee (or any other person or persons exercising the option) shall
concurrently provide irrevocable instructions (i) to a brokerage firm
(reasonably satisfactory to the Corporation for purposes of administering
such procedure in accordance with the Corporation’s
pre-clearance/pre-notification policies) to effect the immediate sale of the
purchased shares and remit to the Corporation, out of the sale proceeds
available on the settlement date, sufficient funds to cover the aggregate
Exercise Price payable for the purchased shares plus all applicable
Withholding Taxes required to be withheld by the Corporation by reason of
such exercise and (ii) to the Corporation to deliver the certificates for
the purchased shares directly to such brokerage firm on such settlement date
in order to complete the sale.

     Except to the extent the sale and remittance procedure is utilized in
connection with the option exercise, payment of the Exercise Price must
accompany the Notice of Exercise (or other notification procedure).

               (iii) Furnish to the Corporation appropriate documentation that the person or
persons exercising the option (if other than Optionee) have the right to exercise
this option.

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               (iv) Make appropriate arrangements with the Corporation (or Parent or
Subsidiary employing Optionee) for the satisfaction of all Withholding Taxes
applicable to the option exercise.

               (b) As soon as practical after the Exercise Date and the Corporation’s collection of the
applicable Withholding Taxes, the Corporation shall issue to or on behalf of Optionee (or any other
person or persons exercising this option) a certificate for the purchased Option Shares.

               (c) In no event may this option be exercised for any fractional shares.

          10. Withholding Taxes. Optionee may satisfy the Withholding Taxes applicable to each
exercise of this option by (i) delivering to the Corporation that number of shares of Class A
Common Stock then owned by Optionee, duly endorsed for transfer to the Corporation and free and
clear of any liens, claims, security interests or other encumbrances, with an aggregate Fair Market
Value equal of the dollar amount of such Withholding Taxes, (ii) delivering to the Corporation
cash, a check payable to the Corporation or such other form of payment permitted by the Plan
Administrator in the aggregate dollar amount required to satisfy such Withholding Taxes or (iii)
using a portion of the sale proceeds of the purchased Option Shares to satisfy such tax withholding
amount, to the extent Optionee exercises the Option pursuant to the sale and remittance procedure
set forth in paragraph 9(a)(ii)(C) hereof.

          11. Compliance with Laws and Regulations. The exercise of this option and the issuance
of the Option Shares upon such exercise shall be subject to compliance by the Corporation and
Optionee 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 exercise and issuance. All shares of Class A Common Stock issued pursuant to the
exercise of this option shall be registered on a Form S8 registration statement under the
Securities Act of 1933, as amended.

          12. Successors and Assigns. Except to the extent otherwise provided in Paragraphs 3
and 6, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the
Corporation and its successors and assigns and Optionee, Optionee’s assigns, the legal
representatives, heirs and legatees of Optionee’s estate and any beneficiaries of this option
designated by Optionee.

          13. 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. Any notice required to be given or delivered to Optionee shall be in writing
and addressed to Optionee at the address at the time on file for Optionee 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.

6

 

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

          15. Conflicting Provisions. This option has been granted pursuant to the
Corporation’s obligations under Section 4 of the Employment Agreement, and this Agreement and the
option evidenced by such Agreement are subject to the terms of the Employment Agreement. In the
event of any conflict between the provisions of the Employment Agreement and this Agreement or the
Incentive Plan , the provisions of the Employment Agreement shall be controlling.

          16. 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.

          17. Employment at Will. Nothing in this Agreement or in the Incentive Plan shall
confer upon Optionee any right to continue in Service for any period of specific duration or
interfere with or otherwise restrict in any way the rights of the Corporation (or any Parent or
Subsidiary employing Optionee) or of Optionee, which rights are hereby expressly reserved by each,
to terminate Optionee’s Service at any time for any reason, with or without cause.

          IN WITNESS WHEREOF, Apollo Group, Inc. has caused this Agreement to be executed on its behalf
by its duly-authorized officer on the date indicated below its signature line, and Optionee has
executed this Agreement on the date below his signature line.

	 	 	 	 	 	 	 	 	 
	 	 	APOLLO GROUP, INC.
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	/s/ Joseph L. D’Amico
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	TITLE:	 	Executive VP and CFO
	 
	 	 	 	 	 	 	 	 
	 	 	DATED:	 	June 28, 2007
	 
	 	 	 	 	 	 	 	 
	 	 	OPTIONEE
	 
	 	 	 	 	 	 	 	 
	 	 	/s/ Gregory Cappelli
	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	GREGORY CAPPELLI
	 
	 	 	 	 	 	 	 	 
	 	 	DATED:	 	June 28, 2007

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APPENDIX

          The following definitions shall be in effect under the Agreement:

          A. Agreement shall mean this Stock Option Agreement.

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

          C. Cause shall have the meaning assigned to such term in Section 7(b)(i) of the
Employment Agreement.

          D. Change in Control shall have the meaning assigned to such term in Section 3.1 of
the Incentive Plan. .

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

          F. Corporation shall mean Apollo Group, Inc., an Arizona corporation, and any
successor corporation to all or substantially all of the assets or voting stock of Apollo Group,
Inc. which shall by appropriate action adopt the Incentive Plan.

          G. 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.

          H. Employment Agreement shall mean the Employment Agreement dated March 31, 2007
between the Corporation and Optionee pursuant to which Optionee has been retained to serve as the
Corporation’s Executive Vice President, Global Strategy, and Assistant to the Chair of the Board.

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

          J. Exercise Date shall mean the date on which the option shall have been exercised in
accordance with Paragraph 9 of this Agreement.

          K. Exercise Price shall mean the exercise price per Option Share as specified in
Paragraph 1 of this Agreement.

          L. Expiration Date shall mean the date on which the option expires as specified in
Paragraph 2 of this Agreement.

          M. Fair Market Value per share of Class A Common Stock on any relevant date shall be
the closing price per share of Class A Common Stock on the date in question on the Stock Exchange
serving as the primary market for the Common Stock, as such price is reported by the National
Association of Securities Dealers (if primarily traded on the Nasdaq Global or

A-1

 

Global Select Market) or as officially quoted in the composite tape of transactions on any
other Stock Exchange on which the Common Stock is then primarily traded. If there is no closing
price for the 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.

          N. Good Reason shall have the meaning assigned to such term in Section 7(c) of the
Employment Agreement.

          O. Grant Date shall mean the grant date of the option as specified in Paragraph 1 of
this Agreement.

          P. Incentive Plan shall mean the Corporation’s 2000 Stock Incentive Plan, as amended
and restated effective May 15, 2007.

          Q. Non-Statutory Option shall mean an option not intended to satisfy the requirements
of Code Section 422.

          R. Notice of Exercise shall mean the notice of option exercise in the form prescribed
by the Corporation.

          S. Option Shares shall mean the number of shares of Class A Common Stock subject to
the option as specified in Paragraph 1 of this Agreement.

          T. Optionee shall mean the person to whom the option is granted.

          U. 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.

          V. Permanent Disability shall mean the inability of Optionee to engage in any
substantial gainful activity by reason of any medically determinable physical or mental impairment
which is expected to result in death or to be of continuous duration of twelve (12) months or more.

          W. Plan Administrator shall mean either the Board or a committee of the Board acting
in its capacity as administrator of the Plan.

          X. Service shall mean Optionee’s performance of services for the Corporation (or any
Parent or Subsidiary, whether now existing or subsequently established) in the capacity of an
Employee. Service shall not be deemed to cease during a period of military leave, sick leave or
other personal leave approved by the Corporation. However, 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 the
Optionee is on a leave of absence.

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

          Z. 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.

          AA. Vesting Schedule shall mean the schedule set forth in Paragraph 4 of this
Agreement pursuant to which the option is to become exercisable for the Option Shares in
installments over the Optionee’s period of Service.

          BB. 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 exercise of the option.

A-3

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