Exhibit 10.1
APOLLO GROUP, INC.
AMENDED AND RESTATED
2000 STOCK INCENTIVE PLAN
ARTICLE 1
PURPOSE
1.1 GENERAL. The Apollo Group, Inc.
2000 Stock Incentive Plan (the “Plan”) was previously
approved by the Board and the Company’s shareholders. The
Plan’s purpose is to promote the success and enhance the
value of Apollo Group, Inc. (the “Company”) by linking
the personal interests of its directors, employees, officers, and
executives of, and consultants and advisors to, the Company to
those of Company shareholders and by providing such individuals
with an incentive for outstanding performance in order to generate
superior returns to shareholders of the Company. The Plan is
further intended to provide flexibility to the Company in its
ability to motivate, attract, and retain the services of directors,
employees, officers, and executives of, and consultants and
advisors to, the Company upon whose judgment, interest, and special
effort the successful conduct of the Company’s operation is
largely dependent.
ARTICLE 2
EFFECTIVE DATE
2.1 EFFECTIVE DATE. The Plan was
originally effective as of August 29, 2000 (the
“Effective Date”). The Plan has been amended and
restated on several occasions since the Effective Date. The
effective date of this amended and restated Plan is March 25,
2008.
ARTICLE 3
DEFINITIONS AND CONSTRUCTION
3.1 DEFINITIONS. When a word or
phrase appears in this Plan with the initial letter capitalized,
and the word or phrase does not commence a sentence, the word or
phrase shall generally be given the meaning ascribed to it in this
Section or in Sections 1.1 or 2.1 unless a clearly different
meaning is required by the context. The following words and phrases
shall have the following meanings:
(a) “Award”
means any Option, Stock Appreciation Right, Restricted Stock Award,
Restricted Stock Unit Award, Performance Share Award, or
Performance-Based Award granted to a Participant under the
Plan.
(b) “Award
Agreement” means any written agreement, contract, or other
instrument or document evidencing an Award.
(c) “Board”
means the Board of Directors of the Company.
(d) “Cause”
means (except as otherwise provided in an Award Agreement) if the
Committee, in its reasonable and good faith discretion, determines
that the employee, consultant, or advisor (i) fails to
substantially perform his duties (other than as a result of
Disability), after the Board or the executive to which the
Participant reports delivers to the Participant a written demand
for substantial performance that specifically identifies the manner
in which the Participant has not substantially performed his
duties; (ii) engages in willful misconduct or gross negligence
that is materially injurious to the Company or a Subsidiary;
(iii) breaches his duty of loyalty to the Company or a
Subsidiary; (iv) unauthorized removal from the premises of the
Company or a Subsidiary of a document (of any media or form)
relating to the Company or a Subsidiary or the customers of the
Company or a Subsidiary; or (v) has committed a felony or a
serious crime involving moral turpitude.
(e) “Change
of Control” means and includes each of the following (except
as otherwise provided in an Award Agreement):
(1) there
shall be consummated any consolidation or merger of the Company in
which the Company is not the continuing or surviving entity, or
pursuant to which Stock would be converted into cash, securities or
other property, other than a merger of the Company in which the
holders of the Company’s Stock immediately prior to the
merger have the same proportionate ownership of beneficial interest
of common stock or interests of the surviving entity immediately
after the merger;
(2) there
shall be consummated any sale, lease, exchange or other transfer
(in one transaction or a series of related transactions) of assets
aggregating more than 80% of the assets of the Company;
(3) the
shareholders of the Company shall approve any plan or proposal for
liquidation or dissolution of the Company;
(4) any
person (as such term is used in Section 13(d) and 14(d)(2) of the
Exchange Act), other than (A) an employee benefit plan of the
Company or any Subsidiary or any entity holding shares of capital
stock of the Company for or pursuant to the terms of any such
employee benefit plan in its role as an agent or trustee for such
plan, or (B) any affiliate of the Company as of the Effective
Date becomes the beneficial owner (within the meaning of
Rule 13d-3 under the Exchange Act) of 50% or more of the
Stock; or
(5) during
any two-year period, individuals who at the beginning of the period
do not constitute a majority of the Board at the end of such
period, unless the appointment or the nomination for election by
the Company’s shareholders of each new director was approved
by a vote of at least two-thirds of the directors then still in
office who were directors at the beginning of the period.
(f) “Code”
means the Internal Revenue Code of 1986, as amended.
(g) “Committee”
means the committee of the Board described in Article 4.
(h) “Covered
Employee” means an Employee who is a “covered
employee” within the meaning of Section 162(m) of the
Code.
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(i) “Disability”
shall mean any illness or other physical or mental condition of a
Participant which renders the Participant incapable of performing
his customary and usual duties for the Company, or any medically
determinable illness or other physical or mental condition
resulting from a bodily injury, disease, or mental disorder that in
the judgment of the Committee is permanent and continuous in
nature. The Committee may require such medical or other evidence as
it deems necessary to judge the nature and permanency of the
Participant’s condition.
(j) “Exchange
Act” means the Securities Exchange Act of 1934, as
amended.
(k) “Fair
Market Value” means, as of any relevant date, the closing
price of the Stock on that date as reported on the Nasdaq Global
Market (or on any other national securities exchange on which the
Stock is at the time listed for trading) or, if no closing price is
reported for that date, the closing price per share of Stock on the
next preceding date for which a closing price was reported.
(l) “Incentive
Stock Option” means an Option that is intended to meet the
requirements of Section 422 of the Code or any successor
provision thereto.
(m) “Non-Employee
Director” means a member of the Board who qualifies as a
“NonEmployee Director” as defined in Rule 16b-3
(b)(3) of the Exchange Act, or any successor definition adopted by
the Board.
(n) “Non-Qualified
Stock Option” means an Option that is not intended to be an
Incentive Stock Option.
(o) “Option”
means a right granted to a Participant under Article 7 of the
Plan to purchase Stock at a specified price during specified time
periods. An Option may be either an Incentive Stock Option or a
Non-Qualified Stock Option.
(p) “Participant”
means a person who, as a director, employee, officer, or executive
of, or consultant or advisor providing services to, the Company or
any Subsidiary, has been granted an Award under the Plan.
(q) “Performance-Based
Awards” means the Performance Share Awards, Restricted Stock
Awards and Restricted Stock Unit Awards granted to selected Covered
Employees pursuant to Articles 9, 10 and 11, but which are subject
to the terms and conditions set forth in Article 12. All
Performance-Based Awards are intended to qualify as
“performance-based compensation” under Section 162(m)
of the Code.
(r) “Performance
Criteria” means the criteria that the Committee selects for
purposes of establishing the Performance Goals for a Participant
for a Performance Period. The Performance Criteria that will be
used to establish Performance Goals are limited to the following:
pre- or after-tax net earnings, sales growth, operating earnings,
operating cash flows, return on net assets, return on
stockholders’ equity, return on assets, return on capital,
Stock price growth, stockholder returns, gross or net profit
margin, earnings per share, price per share of Stock, and market
share, any of which may be measured either in absolute terms or as
compared to any incremental increase or as compared to results of a
peer group. The Committee
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shall,
within the time prescribed by Section 162(m) of the Code, define in
an objective fashion the manner of calculating the Performance
Criteria it selects to use for such Performance Period for such
Participant.
(s) “Performance
Goals” means, for a Performance Period, the goals established
in writing by the Committee for the Performance Period based upon
the Performance Criteria. Depending on the Performance Criteria
used to establish such Performance Goals the Performance Goals may
be expressed in terms of overall Company performance or the
performance of a division, business unit, or an individual. The
Committee, in its discretion, may, within the time prescribed by
Section 162(m) of the Code, adjust or modify the calculation of
Performance Goals for such Performance Period in order to prevent
the dilution or enlargement of the rights of Participants
(i) in the event of, or in anticipation of, any unusual or
extraordinary corporate item, transaction, event or development or
(ii) in recognition of, or in anticipation of, any other
unusual or nonrecurring events affecting the Company or the
financial statements of the Company, or in response to, or in
anticipation of, changes in applicable laws, regulations,
accounting principles or business conditions.
(t) “Performance
Period” means the one or more periods of time, which may be
of varying and overlapping durations, as the Committee may select,
over which the attainment of one or more Performance Goals will be
measured for the purpose of determining a Participant’s right
to, and the payment of, a Performance-Based Award.
(u) “Performance
Share” means a right granted to a Participant under
Article 9, to receive cash, Stock, or other Awards, the
payment of which is contingent upon achieving certain Performance
Goals established by the Committee.
(v) “Plan”
means the Apollo Group, Inc. 2000 Stock Incentive Plan, as amended
and restated.
(w) “Restricted
Stock Award” means Stock granted to a Participant under
Article 10 that is subject to certain restrictions and to risk
of forfeiture.
(x) “Restricted
Stock Unit Award” means restricted stock units awarded to a
Participant under Article 11 which will entitle the
Participant to receive the shares of Stock underlying such Award
upon the attainment of designated performance objectives (which
may, but need not, include one or more Performance Goals) or the
satisfaction of specified employment or service requirements or
upon the expiration of a designated time period following the
vesting of such Award.
(y) “Stock”
means Apollo Education Group Class A common stock and such
other securities of the Company that may be substituted for such
stock, pursuant to Article 14.
(z) “Stock
Appreciation Right” or “SAR” means a right
granted to a Participant under Article 8 to receive a payment
equal to the difference between the Fair Market Value of a share of
Stock as of the date of exercise of the SAR over the grant price of
the SAR, all as determined pursuant to Article 8.
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(aa) “Subsidiary”
means any corporation or other entity of which a majority of the
outstanding voting stock or voting power is beneficially owned
directly or indirectly by the Company.
ARTICLE 4
ADMINISTRATION
4.1 COMMITTEE. The Plan shall be
administered solely and exclusively by a Committee appointed by,
and serving at the discretion of, the Board. The Committee shall
consist of at least three (3) members, each of whom shall qualify
as (i) a Non-Employee Director) and (ii) an
“outside director” under Code Section 162(m) and the
regulations issued thereunder.
4.2 ACTION BY THE COMMITTEE. A
majority of the Committee shall constitute a quorum. The acts of a
majority of the members present at any meeting at which a quorum is
present, and acts approved in writing by a majority of the
Committee in lieu of a meeting, shall be deemed the acts of the
Committee. Each member of the Committee is entitled to, in good
faith, rely or act upon any report or other information furnished
to that member by any officer or other employee of the Company or
any Subsidiary, the Company’s independent certified public
accountants, or any executive compensation consultant or other
professional retained by the Company to assist in the
administration of the Plan.
4.3 AUTHORITY OF COMMITTEE. Subject
to any specific designation in the Plan, the Committee has the
exclusive power, authority and discretion to:
(a) Designate
Participants to receive Awards;
(b) Determine
the type or types of Awards to be granted to each
Participant;
(c) Determine
the number of Awards to be granted and the number of shares of
Stock to which an Award will relate;
(d) Determine
the terms and conditions of any Award granted under the Plan
including but not limited to, the exercise price, grant price, or
purchase price, any restrictions or limitations on the Award, any
schedule for lapse of forfeiture restrictions or restrictions on
the exercisability of an Award, and accelerations or waivers
thereof, based in each case on such considerations as the Committee
in its sole discretion determines; provided, however, that the
Committee shall not have the authority to accelerate the vesting or
waive the forfeiture of any Performance-Based Awards;
(e) Amend,
modify, or terminate any outstanding Award, with the
Participant’s consent unless the Committee has the authority
to amend, modify, or terminate an Award without the
Participant’s consent under any other provision of the
Plan.
(f) Determine
whether, to what extent, and under what circumstances an Award may
be settled in, or the exercise price of an Award may be paid in,
cash, Stock, other Awards, or other property, or an Award may be
canceled, forfeited, or surrendered;
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(g) Prescribe
the form of each Award Agreement, which need not be identical for
each Participant;
(h) Decide
all other matters that must be determined in connection with an
Award;
(i) Establish,
adopt, or revise any rules and regulations as it may deem necessary
or advisable to administer the Plan; and
(j) Make
all other decisions and determinations that may be required under
the Plan or as the Committee deems necessary or advisable to
administer the Plan.
4.4 DECISIONS BINDING. The
Committee’s interpretation of the Plan, any Awards granted
under the Plan, any Award Agreement and all decisions and
determinations by the Committee with respect to the Plan are final,
binding, and conclusive on all parties.
ARTICLE 5
SHARES SUBJECT TO THE PLAN
5.1 NUMBER OF SHARES. Subject to
adjustment as provided in Section 14.1, the aggregate number
of shares of Stock reserved and available for grant under the Plan
shall be 24,079,228 (which number takes into account all stock
splits from the Effective Date through January 30, 2008 and
after the conversion of the University of Phoenix Online common
stock into the Stock). Such authorized share reserve includes an
increase of 5,000,000 shares authorized by the Board on March 24,
2008 and approved by the holders of the Company’s
Class B common stock, the Company’s only outstanding
voting stock, on March 25, 2008.
5.2 LAPSED AWARDS. To the extent that
an Award terminates, expires, or lapses for any reason, any shares
of Stock subject to the Award will again be available for the grant
of an Award under the Plan.
5.3 STOCK DISTRIBUTED. Any Stock
distributed pursuant to an Award may consist, in whole or in part,
of authorized and unissued Stock, treasury Stock or Stock purchased
on the open market.
5.4 LIMITATION ON NUMBER OF SHARES
SUBJECT TO AWARDS. Notwithstanding any provision in the Plan to the
contrary, and subject to adjustment as provided in
Section 14.1, the maximum aggregate number of shares of Stock
with respect to one or more Awards that may be granted to any one
Participant during the Company’s fiscal year shall be one
million (1,000,000).
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ARTICLE 6
ELIGIBILITY AND PARTICIPATION
6.1 ELIGIBILITY.
(a) GENERAL.
Persons eligible to participate in this Plan include all directors,
employees, officers, and executives of, and consultants and
advisors to, the Company or a Subsidiary, as determined by the
Committee.
(b) FOREIGN
PARTICIPANTS. In order to assure the viability of Awards granted to
Participants employed in foreign countries, the Committee may
provide for such special terms as it may consider necessary or
appropriate to accommodate differences in local law, tax policy, or
custom. Moreover, the Committee may approve such supplements to, or
amendments, restatements, or alternative versions of the Plan as it
may consider necessary or appropriate for such purposes without
thereby affecting the terms of the Plan as in effect for any other
purpose; provided, however, that no such supplements, amendments,
restatements, or alternative versions shall increase the share
limitations contained in Section 5.1 of the Plan.
6.2 ACTUAL PARTICIPATION. Subject to
the provisions of the Plan, the Committee may, from time to time,
select from among all eligible individuals, those to whom Awards
shall be granted and shall determine the nature and amount of each
Award. No individual shall have any right to be granted an Award
under this Plan.
ARTICLE 7
STOCK OPTIONS
7.1 GENERAL. The Committee is
authorized to grant Options to Participants on the following terms
and conditions:
(a) EXERCISE
PRICE. The exercise price per share of Stock under an Option shall
be determined by the Committee and set forth in the Award
Agreement; provided, however, that in no event shall the exercise
price per share for any Option be less than the Fair Market Value
per share of Stock on the actual grant date of that Option.
(b) TIME
AND CONDITIONS OF EXERCISE. The Committee shall determine the time
or times at which an Option may be exercised in whole or in part.
The Committee shall also determine the performance or other
conditions, if any, that must be satisfied before all or part of an
Option may be exercised. Unless otherwise provided in an Award
Agreement, an Option will lapse immediately if a
Participant’s employment or services are terminated for
Cause.
(c) PAYMENT.
The Committee shall determine the methods by which the exercise
price of an Option may be paid
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