Exhibit 10.3
[NOTE: Confidential Materials omitted and filed separately with the Securities
and Exchange Commission.
Asterisks denote omissions.]
AMENDED AND RESTATED
WRIGHT EXPRESS CORPORATION
SHORT-TERM INCENTIVE PROGRAM
 
ARTICLE 1- PURPOSE OF PROGRAM
Wright Express Corporation has adopted this Short-Term Incentive Program to
attract and retain high-performing employees; to provide incentives for eligible
employees to achieve specified company, department and/or individual performance
goals; and to reward such employees for the achievement of specified goals on an
annual basis. The Short-Term Incentive Program is intended to qualify as
performance-based compensation under Section 162(m) of the Internal Revenue
Code.
ARTICLE 2- DEFINITIONS
Wherever used in this document, the following terms have the meanings set forth
below.
2.1 Appendix means an Appendix to this Program document containing targets,
payment metrics, and other terms of the Program (or modifications thereof)
applicable to a specific Plan Year. The Appendices shall be considered part of
the Program document.
2.2 Company means Wright Express Corporation.
2.3 Eligible Earnings means total gross pay for the applicable Plan Year (or the
portion thereof during which the Participant is actively employed), including,
salary or wages classified by the Company as regular; paid time off (PTO),
whether planned or unplanned; holiday; bereavement; jury duty; retroactive pay;
overtime pay; shift differential; language differential; and excluding, salary
or wages classified by the Company as disability pay, commission/incentive pay,
and bonuses.
2.4 Effective Date means January 1, 2006.
2.5 MBO means management by objectives.
2.6 Participant means an eligible employee who participates in the Program for a
Plan Year in accordance with Article 3.
2.7 Plan Year means the fiscal year of the Company; as of the Effective Date,
the Plan Year is the calendar year.
2.8 Program means this Wright Express Corporation Short-Term Incentive Program,
as amended from time to time, including the provisions of any Appendix, which
are
 
Page 1 of 9

 

--------------------------------------------------------------------------------

 

[NOTE: Confidential Materials omitted and filed separately with the Securities
and Exchange Commission.
Asterisks denote omissions.]
 
incorporated herein.
ARTICLE 3- PARTICIPATION
3.1 Eligible Employees
Each full-time regular or part-time regular employee of the Company who meets
the following requirements shall be a Participant for a Plan Year:
     (a) The employee is not eligible for any other commission or incentive
variable pay plan of the Company.
     (b) The employee commences employment on or before November 1 of the
applicable year; and
     (c) Except as provided in Section 3.2, the employee is actively employed on
the bonus payment date for the applicable year.
3.2 Special Rules
     (a) A Participant who dies or becomes totally disabled during a Plan Year
(as determined under the Company’s Long-Term Disability program) may receive a
pro-rated bonus for the applicable year based on his or her Eligible Earnings
during the period of the Participant’s active employment. Any bonus payable to a
deceased Participant shall be paid to his or her personal representative.
     (b) A Participant who is not actively employed on the bonus payment date
for a Plan Year due to an approved leave of absence may receive a pro-rated
bonus for the applicable year based on his or her Eligible Earnings during the
period of the Participant’s active employment.
     (c) A Participant who shall be subject of a Performance Improvement Plan at
the time payments are made under Section 5.1 of the Program with respect to any
Plan Year shall not be eligible to receive a payment under the Program for such
Plan Year until he or she has successfully met the requirements of the
Performance Improvement Plan.
ARTICLE 4- ANNUAL INCENTIVES
The Corporate and Executive Officer MBOs for each Plan Year shall be approved by
the Compensation Committee of the Company’s Board of Directors, or its delegate.
An Individual Effectiveness Factor (“IEF”) shall be assigned to an employee
classified as an “associate” based on criteria established by the Company. The
IEF for each associate shall be initially established at 1.00. An associate’s
IEF for a Plan Year may be adjusted
 
Page 2 of 9

 

--------------------------------------------------------------------------------

 

[NOTE: Confidential Materials omitted and filed separately with the Securities
and Exchange Commission.
Asterisks denote omissions.]
 
down, but not below 0.80, or up, but not above 1.20, in increments of 0.05, by
action of his or her supervisor with the approval of his or her division Senior
Vice President and the Company’s President and Chief Executive Officer. However,
the foregoing adjustments (in the aggregate) must not increase the total amount
payable under the Program for the given year.
The performance measures applicable to a Plan Year shall be set out in the
Appendix.
ARTICLE 5- PAYMENTS
5.1 Time and Form
Bonuses shall be calculated and paid in a single payment for the applicable
year, by no later than March 31 of the following year.
5.2 Position Changes
“Position changes” for a Plan Year include promotions, demotions, and transfers
between positions and/or departments.
     (a) For a non-Management Participant, the amount of the Participant’s bonus
is calculated based on his or her position on December 31 of the applicable
year.
     (b) For a Participant who is a Manager, Vice President, Senior Vice
President, or the President and Chief Executive Officer, the amount of the
Participant’s bonus is calculated based on pro-ration for each position change
and each target percentage change during the applicable year (excluding target
percentage changes resulting from a market adjustment).
     (c) For a Participant who is an eligible employee for a portion of the year
and an ineligible employee for a portion of the year, the amount of the
Participant’s bonus is calculated based on pro-ration for the portion of the
year in which he or she was an eligible employee.
5.3 Taxes
All federal, state or local taxes that the Program Administrator determines are
required to be withheld from any payments made under the Program shall be
withheld.
ARTICLE 6- ADMINISTRATION
6.1 Program Administrator
Page 3 of 9

 

--------------------------------------------------------------------------------

 

[NOTE: Confidential Materials omitted and filed separately with the Securities
and Exchange Commission.
Asterisks denote omissions.]
 
The Program shall be administered by the Compensation Committee of the Company’s
Board of Directors, which may delegate administrative responsibility in whole or
in part to the President and Chief Executive Officer and/or the Senior Vice
President, Human Resources (“Administrators”), subject to any requirements for
review and approval that may be established by the Compensation Committee. In
all areas not specifically reserved for such review and approval, the decisions
of the applicable Administrator shall be binding on the Company and each
eligible employee under Article 3. Notwithstanding the foregoing, the
Compensation Committee may not modify MBOs or other performance criteria during
a Plan Year so as to increase the payment to a Section 162(m) Participant (as
defined below) or exercise its discretion to increase the amount of incentive
pay that would otherwise be due a Section 162(m) Participant upon attainment of
a performance goal.
6.2 Claims
Claims regarding payments under the Program shall be directed to a Participant’s
direct supervisor and/or the Company’s Compensation Department. Any claim
regarding the amount of any bonus payment hereunder shall be made within 30 days
of the date of such payment, or shall be forfeited.
ARTICLE 7- AMENDMENT AND TERMINATION
The Company reserves the right to terminate, amend, modify and/or restate this
Program, in whole or in part, at will at any time, with or without advance
notice.
ARTICLE 8- MISCELLANEOUS
8.1 Payment Adjustments and Special Circumstances
The Compensation Committee shall have the authority to adjust payments under the
Program (upward or downward) at its discretion. Subject to the approval of the
Compensation Committee, the President and Chief Executive Officer and the Senior
Vice President, Human Resources, acting together, shall have the power to adjust
payments under the Program (upward or downward) as and to the extent appropriate
to achieve the stated goals and purposes of the Program and may approve
exceptions to the Program under special circumstances, to avoid undue hardship
with respect to a Participant. Notwithstanding the foregoing, neither the
Compensation Committee, the President and CEO, the Senior Vice President, Human
Resources, nor any other person may increase or accelerate the payment due to
any Section 162(m) Participant with respect to any Plan Year. The term
“Section 162(m) Participant” shall mean the President and CEO and each of the
four highest paid officers of the Company (other than the President and CEO) on
the last day of the taxable year, for purposes of the executive compensation
disclosure
Page 4 of 9

 

--------------------------------------------------------------------------------

 

[NOTE: Confidential Materials omitted and filed separately with the Securities
and Exchange Commission.
Asterisks denote omissions.]
 
rules under the Securities Exchange Act of 1934.
8.2 Information
The Program Administrators shall be responsible for ensuring effective
communication of the Program to eligible employees. Copies of the Program shall
be available to all Participants. All modifications and changes to the Program
shall be appropriately documented and communicated to Participants.
Page 5 of 9

 

--------------------------------------------------------------------------------

 

[NOTE: Confidential Materials omitted and filed separately with the Securities
and Exchange Commission.
Asterisks denote omissions.]
 
8.3 No Guarantee of Payment
The Company does not guarantee payment of any bonus amounts hereunder, except to
the extent that payment is required by applicable law.
8.4 Limitation of Employees’ Rights
Nothing contained in the Program shall confer upon any person a right to be
employed or to continue in the employ of the Employer, or interfere in any way
with the right of the Employer to terminate the employment of a Participant at
any time, with or without cause.
IN WITNESS WHEREOF, Wright Express Corporation has caused this document to be
executed by its duly authorized officer this 31st day of March, 2006.

            WRIGHT EXPRESS CORPORATION
      By:   /s/ Robert C. Cornett         Robert C. Cornett        Its: Senior
Vice President, Human Resources        Date: March 31, 2006          
                       

Page 6 of 9

 

--------------------------------------------------------------------------------

 

[NOTE: Confidential Materials omitted and filed separately with the Securities
and Exchange Commission.
Asterisks denote omissions.]
 
APPENDIX I
2006 STIP FACTORS
STIP Weightings

                                              WEX Corporate MBOs                
Adj Net Income     PPG Adj Revenue     Exec Shared, VP & Dept MBOs    
CEO/SVPs
      60 %       20 %       20 %    
Vice Presidents
      50 %       15 %       35 %    
Managers
      40 %       10 %       50 %    
Individual Contributors
      40 %       10 %       50 %    

PPG: Price Per Gallon
Payout Levels
In 2006, the Company must achieve at least threshold results for Adjusted Net
Income in order to pay out any portion of the Short-Term Incentive Program.

                    Performance Results     Payout %    
Threshold
      50 %    
Target
      100 %    
Max
      200 %    

MBOs
Corporate MBOs

                                  Threshold                 Performance Goal    
Performance     Target Performance     Maximum Performance    
Adj Net Income1
    $ [**]     $ [**]     $ [**]    
PPG2 Adj Revenue3
    $ [**]     $ [**]     $ [**]    

 

1   For the purposes of this Program, Adjusted Net Income means Adjusted Net
Income as reported in the Corporation’s Form 8-K filing reporting the
Corporation’s results for the 4th Quarter of 2006 adjusted to exclude the
following items (if any): losses from discontinued operations, the cumulative
effect of changes in Generally Accepted Accounting Principles, any one-time
charge or dilution resulting from any acquisition or divestiture, the effect of
changes to our effective federal tax rates, extraordinary items of loss or
expense, and any other unusual or nonrecurring items of loss or expense,
including restructuring charges. The Compensation Committee may exercise
discretion to include all or part of an item of loss or expense.       The
Compensation Committee has discretion to increase/decrease payout level on
Adjusted Net Income if results increase/decrease by [**]% or more of target
($[**] or more) due to the mismatch on the fuel price derivatives.

Page 7 of 9

 

--------------------------------------------------------------------------------

 

[NOTE: Confidential Materials omitted and filed separately with the Securities
and Exchange Commission.
Asterisks denote omissions.]
 
 

    2PPG: Price Per Gallon       3PPG Adjusted Revenue is reported 2006 Revenue
adjusted for the difference between reported 2006 PPG and Board-approved
budgeted 2006 PPG.

Executive Officer MBOs
CEO and SVPs share the following MBOs:

                                  Weight     Performance Goal     Threshold
Performance     Target Performance     Maximum Performance    
10%
    SOX     By January 31, 2007, the Audit Committee of the Board of Directors
gives the Company an average rating of 3.0 on SOX performance against evaluation
criteria identified in the SOX project plan.     By January 31, 2007, the Audit
Committee of the Board of Directors gives the Company an average rating of 3.5
on SOX performance against evaluation criteria identified in the SOX project
plan.     By January 31, 2007, the Audit Committee of the Board of Directors
gives the Company an average rating of 4.0 on SOX performance against evaluation
criteria identified in the SOX project plan.    
10%
    Strategic
Initiatives     $[**] revenue from sources below AND [**] of [**] at or above
threshold revenue     $[**] revenue from sources below AND [**] of [**] at or
above threshold revenue     $[**] revenue from sources below AND [**] of [**] at
or above target revenue    

                      Strategic Initiative     Threshold     Target    
[**]
    $[**]     $[**]    
[**]
    $[**]     $[**]    
[**]
    $[**]     $[**]    
[**]
    $[**]     $[**]    
[**]
    $[**]     $[**]    

SVP Sales Additional Incentive

                                2006 SVP, Sales Special Incentive     PPG Adj
Revenue $(,000)     Company Performance Level     Special Incentive Performance
Level     SVP, Sales Payout    
$[**]
    [**]%     Miss     $ 0      
$[**]
    [**]%     Threshold     $ 50,000      
$[**]
    [**]%     Target     $ 100,000      
$[**]
    [**]%     Target/Max     $ 150,000      
$[**]
    [**]%     Max     $ 200,000      

No payout below Threshold level
Payout for performance between levels above threshold will be incrementalized
If results exceed maximum of special incentive, CEO can recommend higher payout
for approval
Vice President MBOs
Each Vice President generally has [**] MBOs. While the MBOs are specific to the
individual Vice President, Vice Presidents may have one cross-functional MBO
shared with another Vice President.
Page 8 of 9

 

--------------------------------------------------------------------------------

 

Department MBOs
Each Manager generally has [**] MBOs shared by all STIP-eligible members of
their department.
Page 9 of 9