SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
[Amendment No . . . . . . .]
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to scn. 240.14a-11(c) or scn. 240.14a-12
APOLLO GROUP, INC.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and O-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule O-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
PRELIMINARY COPY OF NOTICE AND PROXY STATEMENT
APOLLO GROUP, INC.
4615 East Elwood Street
Phoenix, Arizona 85040
NOTICE AND PROXY STATEMENT
FOR SPECIAL MEETING OF THE SHAREHOLDERS
TO BE HELD ON OCTOBER 3, 1996
A Special Meeting of the Shareholders (the "Special Meeting") of Apollo
Group, Inc., an Arizona corporation (the "Company"), will be held at 10:00
a.m. (Arizona Time), on October 3, 1996, at the offices of the Company at
4615 East Elwood Street, Phoenix, Arizona, 85040, for the following purposes:
1. To approve an amendment to the Company's Restated Articles of
Incorporation which would increase the number of authorized shares of
Class A Common Stock, no par value, of the Company from 65,000,000 to
400,000,000.
2. To transact such other business as may properly come before the Special
Meeting, and any adjournment or postponement thereof.
Each outstanding share of the Company's Common Stock entitles the holder of
record at the close of business on September 5, 1996, to vote at the Special
Meeting, or any adjournment or postponement thereof. Shares can be voted at
the Special Meeting only if the holder is present or represented by proxy.
By Order of the Board of Directors,
Phoenix, Arizona John G. Sperling, Ph.D.
September 17, 1996 Chairman of the Board of Directors,
President and Chief Executive Officer
SHAREHOLDERS ARE EARNESTLY REQUESTED TO SIGN, DATE AND PROMPTLY RETURN THE
ENCLOSED PROXY. A POSTAGE-PAID ENVELOPE IS PROVIDED FOR MAILING IN THE
UNITED STATES.
<PAGE>
PROXY STATEMENT FOR SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 3, 1996
This Proxy Statement is furnished to the holders of Common Stock of Apollo
Group, Inc. (the "Company") in connection with the solicitation of proxies to
be used in voting at the Special Meeting of Shareholders (the "Special
Meeting") to be held on October 3, 1996. THE ENCLOSED PROXY IS SOLICITED ON
BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY. The proxy materials were
first mailed on or about September 17, 1996, to all holders of Common Stock
of record at the close of business on September 5, 1996.
A person giving the enclosed proxy has the power to revoke it at any time
before it is exercised by either (i) attending the Special Meeting and voting
in person; (ii) duly executing and delivering a proxy bearing a later date;
or (iii) sending written notice of revocation to Peter V. Sperling, Secretary
of the Company, at 4615 East Elwood Street, Phoenix, Arizona 85040.
The Company will bear the cost of the solicitation of proxies, including the
charges and expenses of brokerage firms and others for forwarding
solicitation material to beneficial owners of the outstanding Class A Common
Stock or Class B Common Stock of the Company. In addition to the use of the
mails, proxies may be solicited by personal interview, telephone, facsimile
or telegraph.
OUTSTANDING SHARES AND VOTING RIGHTS
Holders of Class A Common Stock ordinarily do not have any voting rights.
However, because of the nature of the proposed amendment to the Company's
Restated Articles of Incorporation, the Arizona Business Corporation Act
requires that the proposed amendment be approved by holders of a majority of
the shares of Class A Common Stock present and entitled to vote at the
Special Meeting, voting separately as a class, as well as by holders of a
majority of the shares of Class B Common Stock present and entitled to vote
at the Special Meeting, voting separately as a class.
Only holders of record of Class A Common Stock and Class B Common Stock at
the close of business on September 5, 1996 (the "Record Date"), will be
entitled to notice of and to vote at the Special Meeting. At the Record
Date, there were outstanding [49,476,107] shares of Class A Common Stock and
575,769 shares of Class B Common Stock. Each share of Class A Common Stock
and each share of Class B Common Stock will be entitled to one vote upon the
proposed amendment to the Company's Restated Articles of Incorporation.
Votes cast by proxy or in person at the Special Meeting will be tabulated by
the inspectors of election appointed for the meeting and will determine
whether or not a quorum is present. The inspectors of election will treat
abstentions as shares that are present and entitled to vote for purposes of
determining the presence of a quorum, but as unvoted for purposes of
determining the approval of any matter submitted to the Class A Shareholders
for a vote. Accordingly, abstentions shall have the same effect as a vote
against the proposed amendment to the Company's Restated Articles of
Incorporation. If a broker indicates on the proxy that it does not have
discretionary authority as to certain shares to vote on a particular matter,
those shares will not be considered as present and entitled to vote with
respect to that matter.
<PAGE>
PROPOSAL
AMENDMENT TO THE COMPANY'S RESTATED
ARTICLES OF INCORPORATION TO INCREASE THE
AUTHORIZED NUMBER OF SHARES OF CLASS A COMMON STOCK
The Company's Board of Directors has determined that it is in the best
interests of the Company and its shareholders to amend the Company's Restated
Articles of Incorporation to increase the authorized number of shares of
Class A Common Stock, no par value, from 65,000,000 to 400,000,000 (the
"Proposed Amendment"). If the Company's shareholders approve the Proposed
Amendment, the Company will be authorized to issue a total of 404,000,000
shares of capital stock; 400,000,000 shares of Class A Common Stock,
3,000,000 shares of Class B Common Stock and 1,000,000 shares of Preferred
Stock.
If the Company's shareholders approve the Amendment, it will become effective
upon filing a Certificate of Amendment to the Company's Restated Articles of
Incorporation with the Corporation Commission of the State of Arizona. A
copy of the Company's Amended and Restated Articles of Incorporation
reflecting the adoption of the Proposed Amendment is attached hereto as
Exhibit A.
PURPOSE AND EFFECTS OF THE PROPOSED AMENDMENT
The objective of the increase in the authorized number of shares of Class A
Common Stock is to ensure that the Company has sufficient shares available
for business needs and activities as they arise. Such future activities may
include, without limitation, effecting stock splits or dividends,
establishing strategic relationships with corporate partners, effecting
additional financings, or providing equity incentives to employees, officers
or directors. The additional shares also may be issued to acquire or invest
in other businesses. The issuance of additional shares of Class A Common
Stock would decrease the proportionate equity interest of the Company's
current Class A Shareholders and, depending on the price paid for such
additional shares, could result in dilution to the Company's current Class A
Shareholders.
If issued, the additional Class A Common Stock would have rights identical to
the currently outstanding Class A Common Stock. Adoption of the Proposed
Amendment would not affect the rights of the holders of currently outstanding
Class A Common Stock of the Company, except for effects incidental to
authorizing an increase in the number of outstanding shares of the Company's
Class A Common Stock. As noted above, such incidental effects include a
decrease in the proportionate equity interest of current Class A shareholders
if additional shares are issued and, depending on the price paid for any
additional shares issued, could include dilution to the Company's current
Class A shareholders.
If the Company's shareholders approve the Proposed Amendment, the Board of
Directors may cause the issuance of additional shares of Class A Common Stock
without further vote of the shareholders. Current holders of Class A Common
Stock or Class B Common Stock do not have preemptive or similar rights, which
means that current shareholders do not have a prior right to purchase any new
issue of capital stock of the Company in order to maintain their
proportionate ownership level. The Company currently has no commitments to
issue additional shares of Class A Common Stock, although it is continually
exploring potential acquisitions and financing possibilities which could lead
to the issuance of additional shares at any time.
<PAGE>
The Proposed Amendment requires the affirmative vote of the holders of a
majority of the shares of Class A Common Stock present and entitled to vote
at the Special Meeting, voting separately as a class, and the affirmative
vote of the holders of a majority of the Class B Common Stock present and
entitled to vote at the Special Meeting, voting separately as a class.
As of the Record Date, the directors and executive officers of the Company
beneficially owned 48.3% of the outstanding Class A Common Stock and 100.0%
of outstanding Class B Common Stock. All of the directors and executive
officers of the Company have indicated that they intend to vote for approval
of the Proposed Amendment.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE APPROVAL
OF THE PROPOSED AMENDMENT.
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of the Common Stock of the Company as of August 15, 1996 by: (i)
each of the Company's directors; and (ii) all directors and executive
officers as a group. Except as otherwise indicated, to the knowledge of the
Company, all persons listed below have sole voting and investment power with
respect to their shares, except to the extent that authority is shared by
spouses under applicable law.
Class A Shares Class B Shares
Beneficially Owned Beneficially Owned
Name and Address of ------------------------ ------------------------
Beneficial Owner (1) Number Percent Number Percent
- -------------------- --------------- ------- --------------- -------
John G. Sperling 11,118,364(2)(3) 22.4 243,081(12) 42.2
Peter V. Sperling 11,642,594(2)(4) 23.5 232,068(13) 40.3
William H. Gibbs 749,113(5) 1.5 27,950(14) 4.9
Jerry F. Noble 885,797(6) 1.8 27,950 4.9
John D. Murphy 930,467(7) 1.9 27,950 4.9
Dino J. DeConcini 45,825(8) * ___ ___
J. Jorge Klor de Alva 58,500(9) * ___ ___
Thomas C. Weir 45,000(10) * ___ ___
Total for All
Directors and
Executive Officers
as a Group (10
persons) 24,496,399(11) 48.3 575,769 100.0
___________________
* Less than 1%.
(1) The address of each of the listed shareholders, unless noted otherwise,
is in care of Apollo Group, Inc., 4615 East Elwood Street, Phoenix,
Arizona 85040.
(2) Includes 1,498,360 shares held by the John Sperling 1994 Irrevocable
Trust dated April 27, 1994 for which Messrs. John and Peter Sperling are
the co-trustees.
(3) Includes 273,492 shares that Mr. John Sperling has the right to acquire
within 60 days of the date of the table set forth above.
(4) Includes 165,744 shares that Mr. Peter Sperling has the right to acquire
within 60 days of the date of the table set forth above.
(5) Includes 163,089 shares that Mr. Gibbs has the right to acquire within
60 days of the date of the table set forth above.
(6) Includes 178,182 shares that Mr. Noble has the right to acquire within
60 days of the date of the table set forth above.
(7) Includes 193,275 shares that Mr. Murphy has the right to acquire within
60 days of the date of the table set forth above.
(8) Includes 45,375 shares that Mr. DeConcini has the right to acquire
within 60 days of the date of the table set forth above.
<PAGE>
(9) Includes 58,500 shares that Mr. Klor de Alva has the right to acquire
within 60 days of the date of the table set forth above.
(10) Includes 43,500 shares that Mr. Weir has the right to acquire within 60
days of the date of the table set forth above.
(11) Includes 1,232,440 shares that the Company's directors and executive
officers as a group have the right to acquire within 60 days of the date
of the table set forth.
(12) Includes 243,080 shares held by the John G. Sperling Revocable Trust
dated January 31, 1995
(13) Includes 232,067 shares held by the Peter V. Sperling Revocable Trust
dated January 31, 1995.
(14) Includes 27,949 shares held by the William H. Gibbs Revocable Trust
dated March 8, 1995.
OTHER MATTERS
The Board of Directors does not intend to present at the Special Meeting any
matters other than those described herein and does not presently know of any
matters that will be presented by other parties.
APOLLO GROUP, INC.
September 17, 1996 John G. Sperling, Ph.D.
Chairman of the Board of Directors,
President and Chief Executive Officer
<PAGE>
EXHIBIT A
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
APOLLO GROUP, INC.
FIRST: The name of the corporation is APOLLO GROUP, INC.
SECOND: The purposes for which the corporation is organized include the
transaction of any or all lawful business for which corporations may be
incorporated under Chapter 1 of Title 10, Arizona Revised Statutes, at any
time. The character of business which the corporation conducts in the State
of Arizona is that of a holding company of stock of corporations which are
engaged in the business of the operation and management of institutions of
higher education.
THIRD: The total number of shares of capital stock which the corporation
shall have the authority to issue is 404 million shares, consisting of three
classes of capital stock:
(a) 400 million shares of Class A Common Stock, no par value per share (the
"Class A Common Stock");
(b) 3 million shares of Class B Common Stock, no par value per share (the
"Class B Common Stock") (the Class A Common Stock and the Class B Common
Stock collectively are sometimes referred to as the "Common Stock"); and
(c) 1 million shares of Preferred Stock, no par value per share (the
"Preferred Stock").
COMMON STOCK
IDENTICAL RIGHTS. Except as otherwise set forth in this Article THIRD, the
rights and privileges of the Common Stock shall be identical, including
(without limitation) the right to participate ratably in dividends and
liquidation distributions.
VOTING RIGHTS. Except as otherwise provided herein, the shares of Class A
Common Stock shall not be entitled to vote on any matter. Each share of
Class B Common Stock shall be entitled to one vote.
DIVIDENDS. Holders of Common Stock shall be entitled to share ratably and
simultaneously as a single class in all dividends and other distributions of
cash, shares of capital stock of the corporation, other securities of the
corporation or any other company, or any other right or property as may be
declared thereon by the board of directors from time to time out of assets or
funds of the corporation legally available therefor. Any dividends payable
in common stock of the corporation will be payable solely in Class A Common
Stock.
PREEMPTION AND SUBSCRIPTION RIGHTS. Holders of Common Stock are not entitled
to any preemption or subscription rights with respect to their shares of
Common Stock.
<PAGE>
CONVERSION RIGHTS. No Class A Common Stock may ever be converted into Class
B Common Stock. Each share of Class B Common Stock is convertible into Class
A Common Stock at any time at the option of the holder thereof. Such
conversion shall be on a share-for-share basis, one fully paid and
non-assessable share of Class A Common Stock for each share of Class B Common
Stock so converted.
At the time of a conversion, the record holders of Class B Common Stock shall
deliver to the office of the corporation or any transfer agent for the Class
A Common Stock (i) the certificate or certificates representing the Class B
Common Stock to be converted, duly endorsed in blank or accompanied by proper
instruments of transfer and (ii) written notice to the corporation stating
that such record holder elects to convert such share or shares. Conversion
shall be deemed to have been effected at the close of business on the date
when such delivery is made to the corporation of the shares to be converted,
and the person exercising such voluntary conversion shall be deemed to be the
holder of record of the number of shares of Class A Common Stock issuable
upon such conversion at such time. The corporation shall promptly deliver
certificates evidencing the appropriate number of shares of Class A Common
Stock to such person.
In the event of the conversion of less than all of the shares of Class B
Common Stock evidenced by a certificate surrendered to the corporation in
accordance with the procedures of this Article THIRD, the corporation shall
execute and deliver to the holder of such certificate, without charge to such
holder, a new certificate evidencing the number of shares of Class B Common
Stock not converted. Shares of Class B Common Stock that are converted into
Class A Common Stock as provided herein shall be retired and cancelled and
shall not be reissued.
RESERVATION. The corporation hereby reserves and shall at all times reserve
and keep available, out of its authorized and unissued shares of Class A
Common Stock, for the purposes of effecting conversions, such number of duly
authorized shares of Class A Common Stock as shall from time to time be
sufficient to effect the conversion of all outstanding shares of Class B
Common Stock. All the shares of Class A Common Stock so issuable shall, when
so issued, be duly and validly issued, fully paid and non-assessable.
CONSIDERATION ON MERGER, CONSOLIDATION, ETC. In any merger, consolidation,
or business combination, the consideration to be received per share by the
holders of Class A Common Stock and Class B Common Stock must be identical
for each class of stock, except that in any such transaction in which shares
of Common Stock are to be distributed, such shares may differ as to voting
rights to the extent that voting rights now differ among the Class A Common
Stock and the Class B Common Stock.
LIQUIDATION. In the event the corporation shall be liquidated (either
partially or completely), dissolved, or wound up, whether voluntarily or
involuntarily, the holders of Common Stock shall be entitled to share ratably
as a single class in the net assets of the corporation available to holders
of Common Stock; that is, an equal amount of net assets shall be distributed
in respect of each share of Class A Common Stock and Class B Common Stock.
CLASS B COMMON STOCK. There are 575,769 shares of Class B Common Stock
issued and outstanding. No additional shares of Class B Common Stock shall
be issued, except pursuant to any recapitalization or stock split where such
recapitalization or stock split results in a proportionate change in the
shares of Class A Common Stock.
<PAGE>
AUTOMATIC CONVERSION OF CLASS B COMMON STOCK. If at any time the total
number of shares of Class B Common Stock outstanding is less than 115,154
(20% of the total number of shares of Class B Common Stock issued and
outstanding) (subject to adjustment for any recapitalization or stock split),
then each share of Class B Common Stock shall be automatically converted into
one fully paid and non-assessable share of Class A Common Stock at such time
(the "Conversion Date"). Thereafter, each share of Class A Common Stock
shall be entitled to one vote.
At the time of a conversion, the record holders of Class B Common Stock shall
deliver to the office of the corporation or any transfer agent for the Class
A Common Stock the certificate or certificates representing the Class B
Common Stock, duly endorsed in blank or accompanied by proper instruments of
transfer. Conversion shall be deemed to have been effected at the close of
business on the Conversion Date. The corporation shall promptly deliver
certificates evidencing the appropriate number of shares of Class A Common
Stock to each record holder of Class B Common Stock.
NO AMENDMENT OR MODIFICATION. The two immediately preceding sections
entitled "CLASS B COMMON STOCK" and "AUTOMATIC CONVERSION OF CLASS B COMMON
STOCK" shall be amended or modified only upon: (1) a separate majority vote
of the holders of the Class A Common Stock voting as a class; (2) a separate
majority vote of the holders of the Class B Common Stock voting as a class;
and (3) a separate majority vote of the holders of the Class A Common Stock
who do not possess beneficial ownership of any shares of Class B Common
Stock.
PREFERRED STOCK
Shares of Preferred Stock may be issued from time to time in one or more
series as may be determined by the board of directors. Subject to the
provisions of this Article THIRD, the board of directors is authorized to
determine the designations, preferences, privileges, and voting powers of the
shares of each series of Preferred Stock, and the restrictions and
qualifications thereof, by resolution duly adopted prior to the issuance of
any shares of Preferred Stock, PROVIDED that no series of Preferred Stock
shall be entitled to vote on any matter unless also authorized by the holders
of at least 80% of the issued and outstanding Class B Common Stock. All
shares of Preferred Stock shall rank senior to the Common Stock in respect of
the right to receive dividends and the right to receive payment out of the
assets of the corporation upon voluntary or involuntary liquidation,
dissolution, or winding up of the corporation.
FOURTH: The name and address of the statutory agent of the corporation is CT
CORPORATION SYSTEM, 3225 North Central Avenue, Phoenix, Arizona 85012. The
address of the place of business of the corporation is 4615 East Elwood
Street Phoenix, Arizona 85040.
FIFTH: The number of directors constituting the board of directors of the
corporation is eight. The names and addresses of the persons who are to
serve as directors until the next annual meeting of shareholders, or until
their successors are elected and qualified, are:
<PAGE>
Name Address
- ------------------------- -------------------------------------
John G. Sperling 4615 East Elwood Street
Phoenix, Arizona 85040
William H. Gibbs 4615 East Elwood Street
Phoenix, Arizona 85040
Jerry F. Noble 4615 East Elwood Street
Phoenix, Arizona 85040
John D. Murphy 4615 East Elwood Street
Phoenix, Arizona 85040
Peter V. Sperling 4615 East Elwood Street
Phoenix, Arizona 85040
Thomas C. Weir 4615 East Elwood Street
Phoenix, Arizona 85040
J. Jorge Klor de Alva 4615 East Elwood Street
Phoenix, Arizona 85040
Dino J. DeConcini 4615 East Elwood Street
Phoenix, Arizona 85040
SIXTH: A quorum for the transaction of business at any meeting or adjourned
meeting of the Board of Directors shall consist of one-third (1/3) of those
then in office.
SEVENTH: A director of the corporation shall not be personally liable to the
corporation or its shareholders for monetary damages for breach of fiduciary
duty as a director, except for liability for any of the following:
(a) any breach of the director's duty of loyalty to the corporation or its
shareholders,
(b) acts or omissions which are not in good faith or which involve
intentional misconduct or a knowing violation of law,
(c) authorizing the unlawful payment of a dividend or other distribution on
the corporation's capital stock or the unlawful purchase of its capital
stock,
(d) any transaction from which the director derived an improper personal
benefit, or
(e) a violation of Arizona Revised Statutes Section 10-041.
Any repeal or modification of the foregoing paragraph shall not adversely
affect any right or protection of a director of the corporation existing
hereunder with respect to any act or omission occurring prior to or at the
time of such repeal or modification.
<PAGE>
PRELIMINARY COPY OF PROXY CARD
APOLLO GROUP, INC.
SPECIAL MEETING OF SHAREHOLDERS
This proxy is solicited on behalf of the Board of Directors.
The undersigned hereby appoints John G. Sperling and William H. Gibbs, each
with the full power of substitution, and acting alone, as proxies of the
undersigned to vote all shares of Class A Common Stock and Class B Common
Stock of the Apollo Group, Inc. (the "Company") which the undersigned is
entitled to vote at the Special Meeting of Shareholders of the Company to be
held at the offices of the Company at 4615 East Elwood Street, Phoenix,
Arizona 85040, on October 3, 1996 at 10:00 a.m., and at any and all
adjournments or postponements thereof.
This proxy will be voted in accordance with the instruction specified above.
If no direction is made, this proxy will be voted FOR the Proposed Amendment.
1. To approve an amendment to the Company's Restated Articles of
Incorporation increasing the number of authorized shares of
Class A Common Stock, no par value, from 65,000,000 to
400,000,000 shares.
___ FOR ___ AGAINST ___ ABSTAIN
PLEASE MARK, SIGN, DATE AND RETURN THIS CARD USING THE ENCLOSED ENVELOPE
____________________________________________
Signature Date
____________________________________________
Signature if held jointly Date
Please sign exactly as your name
appears. If shares are held by joint
tenants, both should sign. When
signing as attorney, executor,
administrator, trustee, or guardian,
please give full title.
<PAGE>
