Exhibit 10.2

 

DESCRIPTION OF THE COMPANY’S

 

2006 FISCAL YEAR MANAGEMENT INCENTIVE COMPENSATION PLAN

 

On September 14, 2005, the Compensation Committee of the Board of Directors of
Transaction Systems Architects, Inc. (the “Company”) approved the 2006 Fiscal
Year Management Incentive Compensation Plan (the “2006 MIC Plan”).  The 2006 MIC
Plan will be implemented in the Company’s 2006 fiscal year beginning October 1,
2005 and will apply to all of the Company’s employees eligible for a management
incentive bonus (“MIC Bonus”).

 

The objective of the 2006 MIC Plan is to encourage certain management level
personnel to contribute toward the attainment of the consolidated financial
goals for fiscal year 2006 based on corporate, segment and/or channel specific
targets, or specific individual performance attainment requirements.   The MIC
Bonus opportunity is based on targets for five periods (each a “target period”)
comprised of the Company’s four fiscal quarters and its fiscal year end.  If the
minimum targets are not achieved for a target period, no MIC Bonus is paid for
that period.  Earned MIC Bonuses are paid quarterly, with the annual MIC Bonus
paid at the same time as the fourth quarter payout.  MIC Bonuses are paid in
cash.  A MIC Bonus payout may be more or less than 100% (up to a maximum of
200%) depending on the level of attainment as set forth in the table below:

 

Target Attainment
Percentage

 

MIC Bonus
Payout Percentage

 

91% Attainment

 

 

10

%

95% Attainment

 

 

50

%

100% Attainment

 

 

100

%

105% Attainment

 

 

150

%

108.33% Attainment

 

 

200

%

 

A participant in the 2006 MIC Plan must be employed by the Company on the last
day of the target period to be eligible to receive the MIC Bonus payout for the
target period.  If a participant’s employment is terminated for any reason prior
to the end of any target period, the participant will not be eligible to receive
a MIC Bonus for that particular period or any subsequent target period.

 

The Company reserves the right at any time during the 2006 MIC Plan year to:
(a) amend or terminate the plan in whole or in part, (b) revoke any eligible
employee’s right to participate in the 2006 MIC Plan, and (c) make adjustments
to targets at any time during the 2006 MIC Plan year.

 

Under the 2006 MIC Plan, the annual bonus compensation for the senior corporate
executives will be based on certain Company-level financial performance
measures, and for the segment-level senior corporate executives, a combination
of segment-level financial performance (or channel-level performance) and
Company-level performance.

 

The table below summarizes the 2006 fiscal year Company-level and segment-level
financial performance measures and the range of weighting for such performance
measures:

 

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SENIOR CORPORATE EXECUTIVES

 

Performance Measure

 

Performance Measure
Weighting Range

 

Company-Level Performance Measures:

 

 

 

• Revenue

 

12.5% - 30%

 

• Operating Margin.

 

12.5% - 40%

 

• Recurring Revenue

 

0% - 30%

 

 

 

 

 

Segment-Level Performance Measures:

 

 

 

• Segment (Channel) Revenue

 

20% - 25%

 

• Segment (Channel) Operating/Contribution Margin

 

10% - 30%

 

• Segment (Channel) Recurring Revenue

 

0% - 30%

 

 

For the other participants in the 2006 MIC Plan (excluding senior corporate
executives), the annual bonus compensation will be based on a combination of
some or all of the following:  Company-level financial performance measures,
segment-level (or channel-level) financial performance measures and specific
targets for the individual which will be set by their direct managers.  The
weighting of the performance measures will vary for the other 2006 MIC Plan
participants depending on the respective business segment in which they are
employed.

 

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