EURONET WORLDWIDE, INC.
EXECUTIVE ANNUAL INCENTIVE PLAN
1. OBJECTIVE
The Euronet Worldwide, Inc. Executive Annual Incentive Plan (the "Incentive
Plan") is designed to reward value creation by providing competitive incentives
for the achievement of annual financial performance goals. By providing
market-competitive target awards, the Plan supports the attraction and retention
of senior executive talent critical to achieving the strategic business
objectives of Euronet Worldwide, Inc (the "Corporation"). The Incentive Plan is
also intended to secure the full deductibility of bonus compensation payable to
the Corporation's Chief Executive Officer and the four highest compensated
executive officers (collectively the "Covered Employees") whose compensation is
required to be reported in the Corporation's proxy statement and all
compensation payable hereunder to such persons is intended to qualify as
"performance-based compensation" as described in Section 162(m)(4)(C) of the
Internal Revenue Code of 1986, as amended (the "Code").
2. ELIGIBILITY AND PARTICIPATION
Only those executive officers of the Corporation who are selected by the
Compensation Committee (the "Committee") of the Corporation's Board of Directors
(the "Board") shall be eligible to participate in the Incentive Plan. Prior to
or at the time performance objectives are established for an "Incentive Period",
as defined below, the Committee will designate in writing which executive
officers and key employees among those who may be eligible to participate in the
Incentive Plan shall in fact be participants for such Incentive Period.
3. PLAN YEAR, INCENTIVE PERIODS AND INCENTIVE OBJECTIVES
The fiscal year of the Incentive Plan (the "Plan Year") shall be the fiscal
year beginning on January 1 and ending on December 31. The performance period
(the "Incentive Period") with respect to which target awards and bonuses may be
payable under the Incentive Plan shall generally be the Plan Year, provided that
the Committee shall have the authority to designate different Incentive Periods
under the Incentive Plan.
Within the first ninety (90) days of each Incentive Period the Committee
shall establish in writing, with respect to such Incentive Period, one or more
performance goals, a specific target objective or objectives with respect to
such performance goals and an objective formula or method for computing the
amount
of bonus compensation payable to each participant under the Incentive Plan if
the performance goals are attained. Notwithstanding the foregoing sentence, for
any Incentive Period, such goals, objectives and compensation formulae or
methods must be (i) established within that number of days, beginning on the
first day of such Incentive Period, which is no more than twenty-five percent
(25%) of the total number of days in such Incentive Period and (ii) established
such that the outcome of the goal or objective is substantially uncertain at the
time the Committee actually establishes the goal or objective.
Incentive goals shall be based upon one or more of the following business
criteria for the Corporation as a whole or any of its subsidiaries, operating
divisions or other operating units:
(i) Earnings (either in the aggregate or on a per-Share basis);
(ii) Growth or rate of growth in earnings (either in the aggregate or on
a per-Share basis);
(iii) Net income or loss (either in the aggregate or on a per-Share
basis);
(iv) Cash flow provided by operations, either in the aggregate or on
a per-Share basis;
(v) Growth or rate of growth in cash flow (either in the aggregate or on
a per-Share basis);
(vi) Free cash flow (either in the aggregate on a per-Share basis);
(vii) Reductions in expense levels, determined either on a Corporation-
wide basis or in respect of any one or more business units;
(viii) Operating and maintenance cost management and employee productivity;
(ix) Stockholder returns (including return on assets, investments,
equity, or gross sales);
(x) Return measures (including return on assets, equity, or sales);
(xi) Growth or rate of growth in return measures (including return on
assets, equity, or sales);
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(xii) Share price (including attainment of a specified per-Share price
during the Incentive Period; growth measures and total stockholder
return or attainment by the Shares of a specified price for a
specified period of time);
(xiii) Strategic business criteria, consisting of one or more objectives
based on meeting specified revenue, market share, market
penetration, geographic business expansion goals, objectively
identified project milestones, production volume levels, cost
targets, and goals relating to acquisitions or divestitures; and/or
(xiv) Achievement of business or operational goals such as market share
and/or business development;
provided that applicable incentive goals may be applied on a pre- or
post-tax basis; and provided further that the Committee may, when the applicable
incentive goals are established, provide that the formula for such goals may
include or exclude items to measure specific objectives, such as losses from
discontinued operations, extraordinary gains or losses, the cumulative effect of
accounting changes, acquisitions or divestitures, foreign exchange impacts and
any unusual, nonrecurring gain or loss.
Target award levels are approved by the Committee and may be a percentage
of the executive's base salary based on organizational responsibilities and
market-compilation bonus levels based on industry data. In addition, to the
extent consistent with the goal of providing for deductibility under Section
162(m) of the Code, performance goals may be based upon a participant's
attainment of personal objectives with respect to any of the foregoing
performance goals: negotiating transactions and sales, business unit/department
performance, profit margins, reduction of certain accounts receivable or
achievement of subsidiary or departmental budgets or developing long-term
business goals. Measurements of the Corporation's or a participant's performance
against the performance goals established by the Committee shall be objectively
determinable and, unless otherwise established by the Committee when the
incentive goals are established, to the extent they are expressed in standard
accounting terms, they shall be determined according to generally accepted
accounting principals ("GAAP") as in existence on the date on which the
performance goals are established and without regard to any changes in such
principles after such date. Individual incentive awards reflect a mix of the
Corporation's and business unit/department performance along with individual
discretionary factors; the current actual mix for each executive will be
determined based upon his/her role and contribution to the organization.
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Due to the possibility that the specific targets related to a specific
performance goal or objective may be confidential commercial or business
information, and the release of which to the public may have an adverse affect
on the Corporation, such information has been intentionally omitted from the
Plan as confidential information.
4. DETERMINATION OF BONUS AWARDS
As soon as practicable after the end of each Incentive Period, the
Committee shall certify in writing to what extent the Corporation and the
participants have achieved the performance goals or goals for such Incentive
Period, including the specific target objective or objectives and the
satisfaction of any other material terms of the bonus award and the Committee
shall calculate the amount of each participant's bonus for such Incentive Period
based upon the performance goals, objectives and computation formulae or methods
for such Incentive Period. The Committee shall have no discretion to increase
the amount of any participant's bonus as so determined, but may reduce the
amount of or totally eliminate such bonus, if it determines, in its absolute and
sole discretion, that such a reduction or elimination is appropriate in order to
reflect the participant's performance or unanticipated factors.
No participant's bonus for any Plan Year shall exceed the lesser of
500% of the participant's base annual salary as in effect as of the
last day of such Plan Year or $4,000,000.00.
5. PAYMENT OF AWARDS
Approved bonus awards shall be payable by the Corporation to each
participant, or to his estate in the event of his death, as soon as practicable
after the end of each Incentive Period and after the Committee has certified in
writing that the relevant performance goals were achieved. Bonus awards may be
payable in cash or in an equivalent number of shares of the Corporation's common
stock issued pursuant to and under one or more of the Corporation's
stockholder-approved stock incentive plans.
A bonus award that would otherwise be payable to a participant who is not
employed by the Corporation or one of its subsidiaries on the last day of a
Incentive Period shall be prorated, or not paid, in accordance with rules and
regulations adopted by the Committee for the administration of the Incentive
Plan.
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6. OTHER TERMS AND CONDITIONS
Unless otherwise permitted under Section 162(m) of the Code, no bonus
awards shall be paid under the Incentive Plan unless and until the material
terms (within the meaning of Section 162(m)(4)(C) of the Code) of the Incentive
Plan, including the business criteria described above in Section 3 of the
Incentive Plan, are disclosed to the Corporation's stockholders and are approved
by the stockholders by a majority of votes cast in person or by proxy (including
abstentions to the extent abstentions are counted as voting under applicable
state law). The Incentive Plan will submitted to the stockholders for reapproval
if the business criteria stated above in Section 3 are materially changed and,
in any event, will be submitted to be reapproved by stockholders after five
years since the last time stockholder approval was received.
No person shall have any legal claim to be granted an award under the
Incentive Plan and the Committee shall have no obligation to treat participants
uniformly. Except as may be otherwise required by law, bonus awards under the
Incentive Plan shall not be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution,
or levy of any kind, either voluntary or involuntary. Bonuses awarded under the
Incentive Plan shall be payable from the general assets of the Corporation and
no participant shall have any claim with respect to any specific assets of the
Corporation.
Neither the Incentive Plan nor any action taken under the Incentive Plan
shall be construed as giving any employee the right to be retained in the employ
of the Corporation or any subsidiary or to maintain any participant's
compensation at any level.
The Corporation or any of its subsidiaries may deduct from any award any
applicable withholding taxes or any amounts owed by the executive of the
Corporation or any of its subsidiaries.
7. ADMINISTRATION
All members of the Committee shall be persons who qualify as "outside
directors" as defined under Section 162(m) of the Code. Until changed by the
Board, the Committee of the Board shall constitute the Committee hereunder.
The Committee shall have full power and authority to administer and
interpret the provisions of the Incentive Plan and to adopt such rules,
regulations, agreements, guidelines and instruments for the administration of
the Incentive
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Plan and for the conduct of its business as the Committee deems necessary or
advisable.
Except with respect to matters which under Section 162(m)(4)(C) of the Code
are required to be determined in the sole and absolute discretion of the
Committee, the Committee shall have full power to delegate to any officer or
employee of the Corporation the authority to administer and interpret the
procedural aspects of the Incentive Plan, subject to the Incentive Plan's terms,
including adopting and enforcing rules to decide procedural and administrative
issues.
The Committee may rely on opinions, reports or statements of officers or
employees of the Corporation or any subsidiary thereof and of company counsel
(inside or retained counsel), public accountants and other professional or
expert persons.
The Board reserves the right to amend or terminate the Incentive Plan in
whole or in part at any time. Unless otherwise prohibited by applicable law, any
amendment required to conform the Incentive Plan to the requirements of Section
162(m) of the Code may be made by the Committee. No amendment may be made to the
class of individuals who are eligible to participate in the Incentive Plan, the
performance criteria specified in Section 3 or the maximum bonus payable to any
participant without stockholder approval unless stockholder approval is not
required in order for bonuses paid to Covered Employees to constitute qualified
performance-based compensation under Section 162(m) of the Code.
No member of the Committee shall be liable for any action taken or omitted
to be taken or for any determination made by him or her in good faith with
respect to the Incentive Plan, and the Corporation shall indemnify and hold
harmless each member of the Committee against any cost or expense (including
counsel fees) or liability (including any sum paid in settlement of a claim with
the approval of the Committee) arising out of any fact or omission in connection
with the administration or interpretation of the Incentive Plan, unless arising
out of such person's own fraud or bad faith.
The place of administration of the Incentive Plan shall be in the State of
Kansas and the validity, construction, interpretation, administration and effect
of the Incentive Plan and the rules, regulations and rights relating to the
Incentive Plan, shall be determined solely in accordance with the laws of the
State of Delaware.
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