EMPLOYMENT AGREEMENT

This Employment Agreement (the “Agreement”) is made as of June 19, 2007 (the
“Effective Date”) by and between Euronet Worldwide, Inc., a Delaware corporation
(“Employer”), and Kevin Caponecchi, a U.S. citizen residing in Kansas
(“Employee”).

RECITALS

WHEREAS, the Board of Directors of Employer (the “Board”) desires to employ
Employee in a position and on terms and conditions set forth below, and Employee
desires to accept such employment; and

WHEREAS, Employer and Employee desire to enter into this Agreement embodying the
terms of such employment;

NOW, THEREFORE, in consideration of the premises and the mutual covenants and
agreements contained herein, and for other good and valuable consideration, the
adequacy of which is hereby acknowledged, Employer and Employee, each intending
to be legally bound, agree as follows:

1.   Term. The term of this Agreement (the “Term”) shall commence on the
Effective Date and shall continue for a period of five (5) years or until the
date on which Employee’s employment by Employer terminates pursuant to Section 7
or 8 of this Agreement. Following the expiration of the Term, this Agreement may
continue under the same terms and conditions set forth herein for successive
periods of twelve (12) months.

2.            Service. During the Term, Employee shall serve as President of
Employer reporting directly to the Chief Executive Officer of Employer and shall
perform services in such other departments of Employer as requested by the
Board. Employee shall have duties and authority, consistent with such position,
as shall be determined from time to time by the Board.

 

3.

Compensation and Benefits.

(a)          Base Salary. During the first year of the Term, as compensation for
services rendered by Employee under this Agreement, Employer shall pay Employee
an annual base salary at the initial rate of $340,000 per annum, which shall be
payable in installments in accordance with the payroll and personnel practices
of the Company, and which may be increased from time to time (as in effect from
time to time, “Base Salary”). Employer shall increase the annual Base Salary to
$357,500 effective January 1, 2008, provided Employee has maintained
satisfactory performance.

 

(b)

Other Compensation.

 

(i)

During the Term, Employee shall be entitled to such comparable fringe benefits
and perquisites as may be provided to Employer’s executive level employees
pursuant to policies established from time to time by Employer. Employee shall
be eligible for bonuses under Employer’s executive bonus plan commencing in 2009
(with

 

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respect to fiscal year 2008), subject to meeting performance or other targets
set by Employer with respect to such bonuses, with target levels being set at
30%, 60% and 120% of Base Salary.

 

(ii)

Employee and Employee’s immediate family shall be provided by Employer with
medical, dental and life insurance through and in accordance with the terms of
Employer’s group health insurance plan, subject to payment by Employee of a
portion of the premiums in accordance with policies established by Employer from
time to time. Within 60 days following the execution of this Agreement, Employee
will be offered the opportunity to subscribe on a guaranteed basis for up to
$750,000 of life insurance (the “Life Insurance Coverage”) in addition to the
amounts currently offered to other executive employees. As may be mutually
agreed upon between Employer and Employee, the Life Insurance Coverage shall be
provided either under a current group life insurance policy sponsored by
Employer or an individual policy for Employee. Employer shall pay the annual
premium costs of the Life Insurance Coverage not to exceed $3,500 per year, and
Employee shall have the right to continue such life insurance coverage at
Employee’s cost ad infinitum following termination of this Agreement for any
reason.

 

(iii)

Within 5 business days after the Effective Date, Employee will be granted the
restricted stock awards and options described on Exhibit A to this Agreement
(the “Initial Stock Awards”).

 

(iv)

Within 30 business days after the Effective Date, and again one time each year
during 2008, 2009, 2010, and 2011 on the date Employer customarily grants
equity-based awards to its other executive officers (the “Grant Date”), Employer
shall grant Employee (provided Employee is employed by Employer on such Grant
Date and has been continuously employed since the Effective Date): (A)
restricted stock units (“RSUs”), the fair market value of the underlying stock
of which is $400,000 (based on the closing market price of Employer’s common
stock on the day before the Grant Date), and (B) a stock option for Employer’s
common stock, the underlying fair value of such option is $600,000 (determined
on the Grant Date using a Black-Scholes or other binomial pricing model)
(individually, each year’s grant of an RSU and stock option referred to herein
as a “Promised Future Stock Award” and collectively, these five RSUs and option
awards referred to herein as the “Promised Future Stock Awards”). Each Promised
Future Stock Award will be subject to both a five-year time-based vesting
schedule and each Promised Future Stock Award that is an RSU will be subject to
performance-based vesting criteria. The manner in

 

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which such five-year vesting and performance-based vesting will operate is set
forth on Exhibit A to this Agreement.

4.           Other Benefits. During the Term, Employee shall be entitled to
annual vacation of 20 days, provided however that Employee may not use more than
ten consecutive vacation days at one time without the prior consent of the Chief
Executive Officer of Employer and that Employee may accrue no more than five
days of unused vacation from year to year.

5.            Business Expense Reimbursement. Employer shall reimburse Employee
for all reasonable and proper business expenses incurred by Employee in the
performance of Employee’s duties hereunder during the Term, in accordance with
Employer’s customary policies and practices for executive level employees, and
provided such business expenses are reasonably documented.

 

6.

Restrictions on Employee’s Conduct.

(a)          Exclusive Services. During the Term, Employee shall at all times
devote Employee’s full-time attention, energies, efforts and skills to the
business of Employer and each of Employer’s subsidiaries and shall not, directly
or indirectly, engage in any other business activity, whether or not for profit,
gain or other pecuniary advantages, without Employer’s prior written consent,
provided that such prior consent shall not be required with respect to: (i)
business interests that neither compete with Employer nor interfere with the
performance of Employee’s duties and obligations under this Agreement; (ii)
Employee’s charitable, philanthropic or professional association activities
which do not interfere with the performance of Employee’s duties and obligations
under this Agreement; or (iii) participation as witness in litigation relating
to Employee’s prior employment with the General Electric Company and its related
entities, provided that Employee provides reasonable notice as is practicable to
the Chief Executive Officer of Employer of such participation and that such
participation does not unreasonably interfere with the performance of Employee’s
duties and responsibilities to Employer under the terms of this Agreement.

(b)          Confidential Information. During the Term and after the termination
of the Term, Employee shall not disclose or use, directly or indirectly, any
Confidential Information. For the purposes of this Agreement, “Confidential
Information” shall mean all information disclosed to Employee, or known by him
as a consequence of or through Employee’s employment with Employer (under this
Agreement or prior to this Agreement) where such information is not generally
known in the trade or industry or was regarded or treated as confidential by
Employer, and where such information refers or relates in any manner whatsoever
to the business activities, processes, services or products of Employer.
Confidential Information shall include business and development plans (whether
contemplated, initiated or completed), information with respect to the
development of technical and management services, business contacts, methods of
operation, results of analysis, business forecasts, financial data, costs,
revenues, and similar information. Upon termination of the Term, Employee shall
immediately return to Employer all property of Employer and all Confidential
Information, which is in tangible form, including all copies, extracts and
summaries thereof, and any Confidential Information stored electronically on
tapes, computer disks or in any other manner.

 

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(c)

Business Opportunities and Conflicts of Interests.

 

(i)

During the Term, Employee shall promptly disclose to Employer each business
opportunity of a type which, based upon its prospects and relationship to the
existing businesses of Employer, Employer might reasonably consider pursuing.
After termination of this Agreement, regardless of the circumstances thereof,
Employer shall have the exclusive right to participate in or undertake any such
opportunity on its own behalf without any involvement of Employee.

 

(ii)

During the Term, Employee shall refrain from engaging in any activity, practice
or act which conflicts with, or has the potential to conflict with, the
interests of Employer, and he shall avoid any acts or omissions which are
disloyal to, or competitive with Employer.

(d)          Non-Solicitation. For a period of two years following any
termination of this Agreement, Employee shall not, except in the course of
Employee’s duties under this Agreement, directly or indirectly, induce or
attempt to induce or otherwise counsel, advise, ask or encourage any person to
leave the employ of Employer, or solicit or offer employment to any person who
was employed by Employer at any time during the twelve-month period preceding
the solicitation or offer.

 

(e)

Covenant Not to Compete.

 

(i)

During the Term, Employee shall not, without Employer’s prior written consent,
directly or indirectly, either as an officer, director, employee, agent,
advisor, consultant, principal, stockholder, partner, owner or in any other
capacity, on Employee’s own behalf or otherwise, in any way engage in,
represent, be connected with or have a financial interest in, any business which
is, or to Employee’s knowledge, is about to become, engaged in any business with
which Employer is currently or has previously done business or any subsequent
line of business developed by Employer or any business planned during the Term
to be established by Employer. Notwithstanding the foregoing, Employee shall be
permitted to own passive investments in publicly held companies provided that
such investments do not exceed five percent (5%) of any such company’s
outstanding equity.

 

(ii)

For a period of two years following any termination of this Agreement and
without regard to whether Employer or Employee terminates this Agreement,
Employee shall not, engage in competition with Employer, or solicit, from any
person or entity who purchased any product or service from Employer during
Employee’s employment hereunder, the purchase of any product or

 

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service in competition with then existing products or services of Employer.

 

(iii)

For purposes of Section 6(e)(ii) of this Agreement, Employee shall be deemed to
“engage in competition” with Employer if he shall directly or indirectly, either
individually or as a stockholder, director, officer, partner, consultant, owner,
employee, agent, or in any other capacity, consult with or otherwise assist any
person or entity engaged in providing electronic financial transaction
processing or other services similar to those provided by Employer or any member
of Employer’s group of companies. The provisions of Section 6(e)(ii) of this
Agreement shall apply in any location in which Employer has established, or is
in the process of establishing, a business presence. The parties acknowledge
that Employee shall not be regarded as engaging in competition within the
meaning of Section 6(e)(ii) if, following any termination of this Agreement,
Employee is employed by any entity owned or affiliated by General Electric
Company that is not directly engaged in providing electronic financial
transaction processing or other services similar to those provided by Employer
or any member of Employer’s group of companies.

(f)          Employee Acknowledgment. Employee hereby agrees and acknowledges
that the restrictions imposed upon him by the provisions of this Section 6 are
fair and reasonable considering the nature of Employer’s business, and are
reasonably required for Employer’s protection.

(g)         Invalidity. If a court of competent jurisdiction or an arbitrator
shall declare any provision or restriction contained in this Section 6 as
unenforceable or void, the provisions of this Section 6 shall remain in full
force and effect to the extent not so declared to be unenforceable or void, and
the court may modify the invalid provision to make it enforceable to the maximum
extent permitted by law.

(h)          Specific Performance. Employee agrees that if he breaches any of
the provisions of this Section 6, the remedies available at law to Employer
would be inadequate and in lieu thereof, or in addition thereto, Employer shall
be entitled to appropriate equitable remedies, including specific performance
and injunctive relief. The prevailing party in any litigation arising under
Section 6 of this Agreement shall be entitled to recover from the losing party
all of its or Employee’s own costs and attorney’s fees incurred by the
prevailing party with respect to any such litigation. Employee agrees not to
enter into any agreement, either written or oral, which may conflict with this
Agreement, and Employee authorizes Employer to make known the terms of this
Section 6 to any person, including future employers of Employee.

 

7.

Termination.

(a)          Termination by Employer for Cause. Subject to the last sentence of
this Section 7(a), at any time during the Term of this Agreement, Employer may
terminate

 

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Employee’s employment for Cause, as defined below, upon at least fourteen (14)
days written notice setting forth a description of the conduct constituting
Cause. If Employee’s employment is terminated for Cause, he shall be entitled
to:

 

(i)

payment of any earned but unpaid portion of Employee’s Base Salary through the
effective date of such termination;

 

(ii)

reimbursement for any reasonable, unreimbursed and documented business expense
he has incurred in performing Employee’s duties hereunder;

 

(iii)

the right to elect continuation coverage of insurance benefits to the extent
required by law; and

 

(iv)

payment of any accrued but unpaid benefits (including without limitation, any
bonus due by virtue of having met all applicable performance targets prior to
the effective date of such termination), and any other rights, as required by
the terms of any employee benefit plan or program of Employer.

For purposes of this Agreement, “Cause” shall mean: (1) conviction of Employee
of, or the entry of a plea of guilty or nolo contendere by Employee, to any
felony; (2) fraud, misappropriation or embezzlement by Employee; (3) Employee’s
wilful failure or gross misconduct in the performance of Employee’s assigned
duties for Employer; (4) willful failure by Employee to follow reasonable
instructions of any officer to whom Employee reports or the Board; (5)
Employee’s gross negligence in the performance of Employee’s assigned duties for
Employer after being provided with ninety (90) days notice of such gross
negligence and a reasonable opportunity to cure within that period.
Notwithstanding the provisions of this Section 7(a) defining “Cause,” in the
event of a Change of Control and during the Three-Year Period, as the terms
“Change of Control” and “Three-Year Period” are defined in Sections 8(c) and
8(a), respectively), a termination for Cause shall mean only a termination for
an act of dishonesty by Employee constituting a felony which was intended to or
resulted in gain or personal enrichment of Employee at Employer’s expense. For
purposes of this entire agreement and for the avoidance of doubt, the
“termination” of Employee’s employment is intended to be a “separation from
service” under Code section 409A(a)(2)(A)(i) and is to be interpreted in a
manner consistent with such section and applicable Treasury regulations issued
thereunder.

(b)         Termination by Employer Without Cause or Constructive Termination
Without Cause before a Change of Control. At any time before a Change of
Control, Employer may terminate Employee’s employment without Cause, by giving
written notice of termination. If Employee’s employment is terminated without
Cause, or if there is a constructive termination without Cause, as defined
below, Employee shall be entitled to receive from Employer the following:

 

(i)

severance benefits including:

 

(A)

subject to Section 7(h) below, payment of the then current Base Salary for a
severance Period of 24-months

 

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commencing on the effective date of Employee’s termination (the “Severance
Period”), in accordance with Employer’s regular salary payment practices,

 

(B)

if Employee’s termination occurs before the end of the first anniversary of the
Effective Date, then, in addition to the severance payments received pursuant to
Section 7(b)(i)(A) during the Severance Period, Employee shall receive an amount
equal to the Base Salary Employee would have received if he had remained
employed between his actual date of termination and the first anniversary of the
Effective Date, such additional amount to be paid, subject to Section 7(h) in
equal installments over the Severance Period;

 

(C)

if Employee’s termination of employment occurs before the end of the third
anniversary of the Effective Date:

 

(1)

a grant of the 2007, 2008 and/or 2009 Promised Future Stock Awards, to the
extent one or more of such grants has not already been made;

 

(2)

each of the 2007, 2008 and 2009 Promised Future Stock Awards (including those
previously granted) becoming fully vested (in the case of RSUs) and exercisable
(in the case of stock options), to the extent not already vested or exercisable,
respectively, on the effective date of Employee’s termination of employment; and

 

(3)

each of the stock option award portions of the 2007, 2008 and 2009 Promised
Future Stock Awards (including those previously granted) remaining exercisable
by Employee through the full 24-month Severance Period; and

 

(D)

continuation of the vesting of any outstanding stock options, restricted stock
awards, restricted stock unit awards and other equity incentive awards,
including the Initial Stock Award and, only to the extent already granted, a
Promised Future Stock Award (collectively, the “Equity-Based Awards”) and
continuation of Employee’s rights to exercise any exercisable but unexercised
Equity-Based Awards, through the full 24 month Severance Period unless such
option expires earlier on account of the option’s 10-year term;

 

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(ii)

reimbursement for any reasonable, unreimbursed and documented business expense
Employee has incurred in performing his duties hereunder during the Term;

 

(iii)

payment of any accrued but unpaid benefits up to and including the effective
date of the termination of employment (including without limitation, any tax
equalization payments, bonus due up to the date on which the Severance Period
commences), and any other rights, as required by the terms of any employee
benefit plan or program of Employer;

 

(iv)

the right to elect continuation coverage of insurance benefits to the extent
required by law; and

 

(v)

payment of COBRA premiums for medical benefits for a period of six (6) months
following termination of the Severance Period, if Employee timely elects to
continue those benefits under COBRA.

For purposes of this Agreement, termination “without Cause” shall mean
involuntary termination of employment, at the direction of Employer, in the
absence of “Cause” as defined above. For purposes of this Agreement,
“constructive termination without Cause” shall mean a termination of Employee at
Employee’s own initiative within one year following the occurrence, without
Employee’s prior written consent, of one or more of the following events not on
account of Cause (“Constructive Termination Events”):

(1)          a significant and adverse diminution in the nature or scope of
Employee’s authority, title, responsibilities or duties, unless Employee is
given new authority or duties that are substantially comparable to Employee’s
previous authority or duties; provided, however, in no event shall any reduction
or change in Employee’s authority, title, responsibilities or duties resulting
from or in connection with Employer’s sale or divesture of a business unit be
considered a Constructive Termination Event;

(2)          a reduction in Employee’s then-current Base Salary, or a reduction
in Employee’s opportunities for earnings under Employee’s incentive compensation
plans (not attributable to economic conditions or business performance at the
time), or the termination or significant reduction of any employee benefit or
perquisite enjoyed by him (except as part of a general reduction that applies to
substantially all similarly situated employees or participants);

(3)          a change in Employee’s place of employment such that Employee is
required to work more than 50 miles from Employee’s then current place of
employment; or

(4)          a finding by Employee during the first twelve (12) months following
the Effective Date that Employer is materially non-compliant with any local,
state, or federal law or regulation, treaty, or law or regulation of any foreign
state in those places where the Employer does business. For purposes of Section
7(b)(4) of this

 

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Agreement, “materially non-compliant” means Employer’s failure to adhere to any
local, state, or federal law or regulation, treaty, or law or regulation of any
foreign state in those places where the Employer does business which: (i) is
likely to result in any felony criminal charges (or comparable penalties if in a
foreign state) against Employer or any of its then-current or former officers;
or (ii) has a contingent civil liability for monetary damages or penalties to be
awarded against Employer or any of its then-current or former officers that is
deemed material by the Employer’s financial auditors.

If Employee believes there exists a basis for a constructive termination without
Cause, Employee shall provide Employer with thirty days’ written notice
describing such basis, and Employer shall be provided the opportunity to cure
the cause of the constructive termination within a 30-day period following
Employer’s receipt of the written notice describing the event or condition
giving rise to a constructive termination. If the cause of the constructive
termination is cured, then no constructive termination without Cause shall be
found to have taken place.

For purposes of this Section 7(b)(i) only, Employee shall be considered to be an
Employee of Employer during the entire Severance Period, and during such
Severance Period and thereafter if otherwise required by this Agreement, shall
abide by the Restrictive Covenants set forth in Section 6(b), 6(c), 6(d) and
6(e).

(c)          Voluntary Termination by Employee. Employee may terminate this
Agreement at any time by giving 60 days’ written notice to Employer. If Employee
voluntarily terminates his employment for reasons other than Employee’s death,
disability, or constructive termination without Cause, he shall be entitled to:

 

(i)

payment of any earned but unpaid portion of Employee’s Base Salary through the
effective date of such termination;

 

(ii)

reimbursement of any reasonable, unreimbursed and documented business expense
Employee has incurred in performing Employee’s duties hereunder;

 

(iii)

the right to elect continuation coverage of insurance benefits to the extent
required by law; and

 

(iv)

payment of any accrued but unpaid benefits, and any other rights, as required by
the terms of any employee benefit plan or program of Employer.

Any payments made under this Section 7(c) shall be made within 30 days of
Employee’s termination of employment.

(d)         Termination Due to Death. Employee’s employment and this Agreement
shall terminate immediately upon Employee’s death. If Employee’s employment is
terminated because of Employee’s death, Employee’s estate or Employee’s
beneficiaries, as the case may be, shall be entitled to:

 

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(i)

payment of any earned but unpaid portion of Employee’s then current Base Salary
through the effective date of such termination;

 

(ii)

payment of a lump-sum death benefit equal to 24 months’ then current Base Salary
and, if Employee dies before the first anniversary of the Effective Date, the
death benefit provided under this Section 7(d)(ii) shall be increased by the
amount of Base Salary Employee would have received but for his death by working
between his date of death and until the first anniversary of the Effective Date;

 

(iii)

reimbursement for any reasonable, unreimbursed and documented business expense
Employee incurred in performing Employee’s duties hereunder;

 

(iv)

the right to elect continuation coverage of insurance benefits to the extent
required by law;

 

(v)

any pension survivor benefits that may become due pursuant to any employee
benefit plan or program of Employer;

 

(vi)

payment of any accrued but unpaid benefits and any other rights, and vesting of
any outstanding Equity-Based Awards as provided by the terms of any employee
benefit plan or program of Employer; and

 

(vii)

if Employee’s death occurs before the end of the third anniversary of the
Effective Date:

 

(A)

a grant of the 2007, 2008 and/or 2009 Promised Future Stock Awards, to the
extent one or more of such grants has not already been made;

 

(B)

each of the 2007, 2008 and 2009 Promised Future Stock Awards (including those
previously granted) becoming fully vested (in the case of RSUs) and exercisable
(in the case of stock options), to the extent not already vested or exercisable,
respectively, on the effective date of Employee’s termination of employment; and

 

(C)

each of the stock option award portions of the 2007, 2008 and 2009 Promised
Future Stock Awards (including those previously granted) remaining exercisable
by Employee in accordance with the terms of the applicable option award
agreements.

Any payments made under this Section 7(d) shall be made within 30 days of
Employee’s death.

 

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(e)          Termination Due to Disability. Employer may terminate Employee’s
employment at any time if Employee becomes disabled, upon written notice by
Employer to Employee. If Employee’s employment is terminated because of
Employee’s disability, he shall be entitled to:

 

(i)

payment of any earned but unpaid portion of Employee’s then current Base Salary
through the effective date of such termination;

 

(ii)

payment of a lump-sum disability benefit equal to 24 months’ then current Base
Salary and, if Employee’s termination on account of disability occurs before the
first anniversary of the Effective Date, the disability benefit provided under
this Section 7(e)(ii) shall be increased by the amount of Base Salary Employee
would have received, but for his termination on account of disability, by
working between his actual termination date and until the first anniversary of
the Effective Date;

 

(iii)

reimbursement for any reasonable, unreimbursed and documented business expense
he has incurred in performing Employee’s duties hereunder;

 

(iv)

the right to elect continuation coverage of insurance benefits to the extent
required by law;

 

(v)

payment of any accrued but unpaid benefits and any other rights, and vesting of
any outstanding Equity-Based Awards, as provided by the terms of any employee
benefit plan or program of Employer; and

 

(vi)

if Employee’s termination on account of disability occurs before the end of the
third anniversary of the Effective Date:

 

(A)

a grant of the 2007, 2008 and/or 2009 Promised Future Stock Awards, to the
extent one or more of such grants has not already been made;

 

(B)

each of the 2007, 2008 and 2009 Promised Future Stock Awards (including those
previously granted) becoming fully vested (in the case of RSUs) and exercisable
(in the case of stock options), to the extent not already vested or exercisable,
respectively, on the effective date of Employee’s termination of employment; and

 

(C)

each of the stock option award portions of the 2007, 2008 and 2009 Promised
Future Stock Awards (including those previously granted) remaining exercisable
by Employee in accordance with the terms of the applicable option award
agreements.

 

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Any payments made under this Section 7(e) shall be made within 30 days of
Employee’s termination of employment. “Disability,” as used in this paragraph,
means a physical or mental illness, injury, or condition that (a) prevents, or
is likely to prevent, as certified by a physician, Employee from performing one
or more of the essential functions of Employee’s position, for at least 120
consecutive calendar days or for at least 150 calendar days, whether or not
consecutive, in any 365 calendar day period, and (b) which cannot be
accommodated with a reasonable accommodation, without undue hardship on
Employer, as specified in the Americans with Disabilities Act.

(f)          Payments Terminated. If Employee has failed to comply with the
requirements of the Confidentiality, Non-Solicitation and Non-Competition
provisions referenced in Section 6 hereof at any time following any termination,
then Employer shall have no further obligation to pay any amounts or provide any
benefits, including, but not limited to, any continued vesting of any
Equity-Based Awards, under this Agreement.

(g)          No Obligation to Mitigate. Following any termination under this
Section 7, Employee shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise and
except as expressly set forth herein no such other employment, if obtained, or
compensation or benefits payable in connection therewith shall reduce any
amounts or benefits to which Employee is entitled hereunder.

(h)          Payments to Specified Employee. If Employee is a “specified
employee” (as defined in section 409A(a)(2)(B)(i) of the Internal Revenue Code
(the “Code”) (hereinafter a “Specified Employee”)) at the time Employee is
eligible to be paid any amounts under Section 7(b)(i)(A) and (B), such
payment(s) shall be made as follows:

 

(i)

That portion of the total amount to be paid to Employee which does not exceed
two times the lesser of (A) and (B), below, shall be paid in equal installments
in accordance with Employer’s regular salary payment practices over the
Severance Period —

 

(A)

The sum of Employee’s annualized compensation based upon the annual rate of pay
for services provided to Employer for Employer’s taxable year preceding
Employee’s taxable year in which Employee has a separation from service with
Employer (adjusted for any increase during that year that was expected to
continue indefinitely if Employee had not terminated employment); or

 

(B)

The maximum amount that may be taken into account under a qualified plan
pursuant to section 401(a)(17) for the year of Employee’s termination of
employment.

 

(ii)

That portion which exceeds the amount that may be paid under Section 7(h)(i)
above shall be paid in equal installments in accordance with Employer’s regular
salary payment practices over

 

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the Severance Period except that no payments shall be made during the first six
months following Employee’s termination of employment and each such payment
which otherwise would have been made during such initial six-month time period
shall be held in arrears by Employer until one day after six months following
Employee’s termination of employment, at which time all amounts held in arrears
shall be paid in a lump sum and the remaining 18 months of severance pay shall
be paid in equal installments in accordance with Employer’s regular salary
payment practices over the Severance Period.

 

8.

Continuation of Employment Upon Change of Control.

(a)          Continuation of Employment. Subject to the terms and conditions of
this Section 8, in the event of a Change of Control of Employer (as defined in
Section 8(c)) at any time during Employee’s employment hereunder, Employee will
remain in the employ of Employer for a period of an additional three years from
the date of such Change of Control (the “Change Control Date”). Employer shall,
for the three year period (the “Three-Year Period”) immediately following the
Control Change Date, continue to employ Employee in a position without
substantial adverse alteration in the nature or status of Employee’s authority,
duties or responsibility as compared with the position Employee held immediately
prior to the Change of Control. During the Three-Year Period, Employer shall
continue to pay Employee salary on the same basis, at the same intervals and at
a rate not less than, that paid to Employee at the Control Change Date. Any
termination of employment by Employer following a Control Change Date and during
the Three-Year Period (a “Post-CoC Termination”) shall be governed by this
Section 8 rather than the provisions of Section 7(a) or (b).

(b)         Benefits. On the Control Change Date, all outstanding Equity-Based
Awards held by Employee shall become immediately vested. In addition, during the
Three-Year Period, Employee shall be entitled to receive the following benefits
and participate, on the basis of his employment position, in each of the
following plans (collectively, the “Specified Benefits”) in existence, and in
accordance with the terms thereof, at the Control Change Date:

 

(i)

any incentive compensation plans;

 

(ii)

any benefit plan and trust fund associated therewith, related to (A) life,
health, dental, disability, or accidental death and dismemberment insurance, (B)
employee stock ownership (such as under Employer’s ESPP and other equity-based
plans); and

 

(iii)

any other benefit plans hereafter made generally available to employees at
Employee’s level or to Employees of Employer generally.

(c)          Definition of Change of Control. For purposes of this Section, a
“Change of Control” shall be considered to have occurred if (i) Employer has
completed a merger in which shareholders of Employer immediately prior to the
merger hold less than 50% of the

 

13

 

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surviving entity, consolidation or dissolution of Employer or a sale, lease,
exchange or disposition of all or substantially all of Employer’s assets, (ii)
less than a majority of the members of the Board shall be individuals who were
members of the Board on the Effective Date or whose election or nomination was
approved by a vote of at least a majority of the members of the Board then still
in office who were either members of the Board on the Effective Date or whose
election or nomination was so approved, or (iii) any “person” (as such term is
used in Sections 13(d) and 14(d) of the U.S. Securities Exchange Act of 1934
(the “Exchange Act”) shall have become “beneficial owner” (as defined in Rule
13d-3 under the Exchange Act) directly or indirectly of securities of Employer
representing 40% or more (calculated in accordance with Rule 13d-3) of the
aggregate voting power of Employer’s then outstanding voting securities.

(d)         Termination Without Cause After Change of Control. Notwithstanding
any other provision of this Section 8, at any time after the Control Change
Date, Employer may terminate the employment of Employee with or without Cause.
To the extent Employee experiences a Post-CoC Termination:

 

(i)

Employer shall pay Employee any earned but unpaid portion of Employee’s Base
Salary through the effective date of such Post-CoC Termination;

 

(ii)

Employer shall reimburse Employee for any reasonable, unreimbursed and
documented business expenses Employee incurred in performing Employee’s duties
hereunder;

 

(iii)

Employer shall pay Employee an amount (the “Special Severance Payment”) equal to
the present value (calculated using a discount rate equal to 7.5% per annum) of
Employee’s Base Salary that would have been paid to Employee had Employee
remained an employee until the later of (A) the end of the Three-Year Period or
(B) 24 months following the effective date of Employee’s Post-CoC Termination
(such additional 24 month period in this Section 8(d)(iii)(B) hereinafter
referred to as the “Extended Period”).

 

(iv)

In connection with Employer’s promise to Employee that, provided Employee has
not resigned or otherwise been terminated for Cause, Employee will receive at
least the first three (i.e., 2007, 2008 and 2009) grants of the Promised Future
Stock Awards, to the extent that less than all three such awards have been
granted, Employer shall grant whichever of such awards has not yet been granted.
If each of such three awards has already been granted on Employee’s Post-CoC
Termination, Employee will not be entitled to any additional equity-award grants
under this section.

 

(v)

Employer shall pay Employee an amount equal to the taxable income Employee would
recognize if, on the effective date of Employee’s termination of employment:

 

14

 

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(A)

each outstanding Equity-Based Award, or portion thereof, (other than any
Promised Future Stock Award) that, in the case of RSUs, would have become vested
and, in the case of stock options, would have become exercisable, prior to the
end of the Three-Year Period or, if later, the Extended Period, and

 

(B)

all granted Promised Future Stock Awards (including any of the 2007, 2008 and
2009 Promised Future Stock Awards which were granted pursuant to Section
8(d)(iv) above) and only to the extent not already vested (in the case of RSUs)
or exercised (in the case of stock options),

became vested and were exercised. For purposes of determining the taxable income
Employee would have recognized on account of the above mentioned awards becoming
vested (in the case of RSUs) or hypothetically being exercised (in the case of
stock options), the fair market value of the Company’s stock underlying the
Equity-Based Awards will be the fair market value as of the effective date of
Employee’s termination.

 

(vi)

Employer shall provide Employee (and, if applicable under the applicable benefit
plan, his spouse and family) coverage under Employee benefit plans (such as
medical, dental, disability and life) that covered him (or them) immediately
before Employee’s termination as if he had remained in employment until the end
of the Three-Year Period, or, if longer, the end of the Extended Period. If
Employee’s participation in any plan is barred, the Company shall arrange to
provide Employee substantially similar benefits.

Subject to Section 8(f) below, all payments required under paragraphs (i)
through (iv) above shall be made no later than the fifth business day following
the effective date of Employee’s termination of employment.

(e)          Resignation following a Change of Control. If, within the
Three-Year Period Employee experiences a Constructive Termination Event, and
after providing written notice to Employer no later than 90 days of the date the
Constructive Termination Event first arose or occurred, Employer fails to cure
the event or condition giving rise to the Constructive Event within the 30-day
period following Employer’s receipt of the written notice, Employee may,
effective at the end of such 30-day cure period, resign his employment with
Employer (the “Resignation”). In connection with such Resignation, Employer
shall pay to Employee the same amounts and benefits Employee would have been
entitled to receive if he experienced a Post-CoC Termination under Section 8(d)
above.

(f)          Timing of Payments. The time at which all payments due under
Sections 8(d) or 8(e) above will commence and the form in which such payments
will be made will depend upon the following two factors: (1) whether Employee is
a Specified Employee and (2)

 

15

 

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whether the Post-CoC Termination occurs on or before, or after the second
anniversary of the Control Change Date. Each of the payment scenarios is set
forth below.

 

(i)

If Employee is a Specified Employee at the time Employee is eligible to be paid
any amounts under Section 8(d) or 8(e), and Employee’s termination from
employment is on or before the second anniversary of the Control Change Date,
such payment(s) shall be made as follows:

 

(A)

That portion of the total amount to be paid to Employee which does not exceed
two times the lesser of (1) and (2) below shall be paid in a lump sum payment
within 5 business days of Employee’s termination of employment—

 

(1)

The sum of Employee’s annualized compensation based upon the annual rate of pay
for services provided to Employer for Employer’s taxable year preceding
Employee’s taxable year in which Employee has a separation from service with
such Employer (adjusted for any increase during that year that was expected to
continue indefinitely if Employee had not terminated employment); or

 

(2)

The maximum amount that may be taken into account under a qualified plan
pursuant to section 401(a)(17) for the year of Employee’s termination of
employment.

 

(B)

That portion which exceeds the amounts that may be paid under Section 8(f)(i)(A)
above shall be paid, in a lump sum, on the first day after the six month
anniversary of the effective date of Employee’s termination of employment.

 

(ii)

If Employee is not a Specified Employee at the time Employee is eligible to be
paid any amounts under Section 8(d) or 8(e), and Employee’s termination from
employment is on or before the second anniversary of the Control Change Date,
such payment(s) shall be paid in a lump sum payment within 5 business days of
Employee’s termination of employment.

 

(iii)

If Employee is a Specified Employee at the time Employee is eligible to be paid
any amounts under Section 8(d) or 8(e), and Employee’s termination from
employment is after the second anniversary of the Control Change Date, such
payment(s) shall be made as follows:

 

(A)

That portion of the total amount to be paid to Employee which does not exceed
two times the lesser of (1) and (2)

 

16

 

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below shall be paid in a lump sum payment within 5 business days of Employee’s
termination of employment—

 

(1)

The sum of Employee’s annualized compensation based upon the annual rate of pay
for services provided to Employer for Employer’s taxable year preceding
Employee’s taxable year in which Employee has a separation from service with
such Employer (adjusted for any increase during that year that was expected to
continue indefinitely if Employee had not terminated employment); or

 

(2)

The maximum amount that may be taken into account under a qualified plan
pursuant to section 401(a)(17) for the year of Employee’s termination of
employment.

 

(B)

That portion which exceeds the amount that may be paid under Section
8(f)(iii)(A) above shall be paid in equal installments in accordance with
Employee’s regular salary payment practices over the Severance Period except
that no payments shall be made during the first six months following Employee’s
termination of employment and each such payment which otherwise would have been
made during such initial six-month time period shall be held in arrears by
Employer until the first payment made six months and one day following
Employee’s termination of employment at which time all amounts held in arrears
shall be paid in a lump sum and the remaining 18 months of severance pay shall
be paid in equal installments in accordance with Employer’s regular salary
payment practices over the Severance Period.

 

(iv)

If Employee is not a Specified Employee at the time Employee is eligible to be
paid any amounts under Section 8(d) or 8(e), and Employee’s termination from
employment is after the second anniversary of the Control Change Date, such
payment(s) shall be made as follows:

 

(A)

That portion of the total amount to be paid to Employee which does not exceed
two times the lesser of (1) and (2), below, shall be paid in a lump sum payment
within 5 business days of Employee’s termination of employment—

 

(1)

The sum of Employee’s annualized compensation based upon the annual rate of pay
for services provided to Employer for Employer’s taxable year

 

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preceding Employee’s taxable year in which Employee has a separation from
service with such Employer (adjusted for any increase during that year that was
expected to continue indefinitely if Employee had not terminated employment); or

 

(2)

The maximum amount that may be taken into account under a qualified plan
pursuant to section 401(a)(17) for the year of Employee’s termination of
employment.

 

(B)

That portion which exceeds the amount that may be paid under Section
8(f)(iv)(A), above, shall be paid in equal installments over the Severance
Period in accordance with Employer’s regular salary payment practices.

 

(g)

Mitigation and Expenses.

 

(i)

Other Employment. After the Control Change Date, Employee shall not be required
to mitigate the amount of any payment provided for in this Agreement by seeking
other employment or otherwise and except as expressly set forth herein no such
other employment, if obtained, or compensation or benefits payable in connection
therewith shall reduce any amounts or benefits to which Employee is entitled
hereunder.

 

(ii)

Expenses. If any dispute should arise under this Agreement after the Control
Change Date involving an effort by Employee to protect, enforce or secure rights
or benefits claimed by Employee hereunder, Employer shall pay (promptly upon
demand by Employee accompanied by reasonable evidence of incurrence) all
reasonable expenses (including attorney’s fees) incurred by Employee in
connection with such dispute, without regard to whether Employee prevails in
such dispute except that Employee shall repay Employer any amounts so received
if a court having jurisdiction shall make a final, non-appealable determination
that Employee acted frivolously or in bad faith by such dispute

(h)          Successors in Interest. The rights and obligations of Employer and
Employee under this Section 8 shall inure to the benefit of and be binding in
each and every respect upon the direct and indirect successors and assigns of
Employer and Employee, regardless of the manner in which such successors or
assigns shall succeed to the interest of Employer or Employee hereunder and this
Section 8 shall not be terminated by the voluntary or involuntary dissolution of
Employer or any merger or consolidation or acquisition involving Employer, or
upon any transfer of all or substantially all of Employer’s assets, or
terminated otherwise than in accordance with its terms. In the event of any such
merger or consolidation or transfer of assets, the provision of this Section 8
shall be binding upon and shall inure to the

 

18

 

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benefit of the surviving corporation or the corporation or other person to which
such assets shall be transferred.

9.            Deductions and Withholding. Employee agrees that Employer may
withhold from any and all payments required to be made by Employer to Employee
under this Agreement all taxes or other amounts that Employer is required by law
to withhold in accordance with applicable laws or regulations from time to time
in effect.

10.         Gross Up Payment. If at any time or from time-to-time, it shall be
determined by tax counsel mutually agreeable to Employer and Employee that any
payment or other benefit to pursuant to this Agreement or otherwise (“Potential
Parachute Payment”) is or will become subject to the excise tax imposed by
Section 4999 of the Code or any similar tax (“Excise Taxes”), then Employer
shall, subject to the limitations below, pay or cause to be paid a tax gross-up
payment (“Gross-Up Payment”) with respect to all such Excise Taxes and other
taxes on the Gross-Up Payment. The Gross-Up Payment shall be an amount equal to
the product of (a) the amount of the Excise Taxes multiplied by (b) a fraction
(the “Gross-Up Multiple”), the numerator or which is one (1.0), and the
denominator of which is one (1.0) minus the lesser of (i) the sum, expressed as
a decimal fraction, of the effective marginal rates of any taxes and any Excise
Taxes applicable to the Gross-Up Payment or (ii) .80, it being intended that the
Gross-Up Multiple shall in no event exceed five (5.0). If different rates of tax
are applicable to various portions of a Gross-Up Payment, the weighted average
of such rates shall be used. Excise Taxes and other penalties under Section 409A
of the Code shall not be considered “any similar tax” for purposes of this
Agreement.

(a)          To the extent possible, any payments or other benefits to Employee
pursuant to this Agreement shall be allocated as consideration for Employee’s
entry into the covenants made by him in Section 6(e).

(b)          Notwithstanding any other provisions of this Section 10, if the
aggregate After-Tax Amount (as defined below) of the Potential Parachute
Payments and Gross-Up Payment that, but for this limitation, would be payable to
Employee, does not exceed 120% of After-Tax Floor Amount (as defined below),
then no Gross-Up Payment shall be made to Employee and the aggregate amount of
Potential Parachute Payments payable to Employee shall be reduced (but not below
the Floor Amount) to the largest amount which would both (i) not cause any
Excise Tax to be payable by Employee and (ii) not cause any Potential Parachute
Payments to become nondeductible by Employer by reason of Section 280G of the
Code (or any successor provision). For purposes of the preceding sentence,
Employee shall be deemed to be subject to the highest effective after-tax
marginal rate of taxes.

For purposes of this Agreement:

 

(i)

“After-Tax Amount” means the portion of a specified amount that would remain
after payment of all taxes paid or payable by Employee in respect of such
specified amount; and

 

(ii)

“Floor Amount” means the greatest pre-tax amount of Potential Parachute Payments
that could be paid to Employee without

 

19

 

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causing Employee to become liable for any Excise Taxes in connection therewith;
and

 

(iii)

“After-Tax Floor Amount” means the After-Tax Amount of the Floor Amount.

(c)          If for any reason tax counsel mutually agreeable to Employer and
Employee later determine that the amount of Excise Taxes payable by Employee is
greater than the amount initially determined pursuant to the above provisions of
this Section 10, then Employer shall, subject to Sections 10(d) and 10(e) pay
Employee, within thirty (30) days of such determination, or pay to the IRS as
required by applicable law, an amount (which shall also be deemed a Gross-Up
Payment) equal to the product of (a) the sum of (i) such additional Excise Taxes
and (ii) any interest, penalties, expenses or other costs incurred by Employee
as a result of having taken a position in accordance with a determination made
pursuant to Paragraph 10(d), multiplied by the Gross-Up Multiple.

(d)         Employee shall immediately notify Employer in writing (an
“Employee’s Notice”) of any claim by the IRS or other taxing authority (an “IRS
Claim”) that, if successful, would require the payment by Employee of Excise
Taxes in respect of Potential Parachute Payments in an amount in excess of the
amount of such Excise Taxes determined in accordance with Section 10. Employee’s
Notice shall fully inform Employer of all particulars of the IRS Claim and the
date on which such IRS Claim is due to be paid (the “IRS Claim Deadline”).

Employer shall direct Employee as to whether to pay all or part of the IRS Claim
or to contest the IRS Claim or to pursue a claim for a refund (a “Refund Claim”)
of all or any portion of such Excise Taxes, other taxes, interest or penalties
as may be specified by Employer in a written notice to Employee. If Employer
directs Employee to pay all or part of the IRS Claim, the amount of such payment
shall also be deemed a Gross-Up Payment, which Employer shall pay to Employee or
the IRS, as appropriate. Employee shall cooperate fully with Employer in good
faith to contest such IRS Claim or pursue such Refund Claim (including appeals)
and shall permit Employer to participate in any proceedings relating to such IRS
Claim or Refund Claim.

Employer shall control all proceedings in connection with such IRS Claim or
Refund Claim (as applicable) and in its discretion may cause Employee to pursue
or forego any and all administrative appeals, proceedings, hearings and
conferences with the Internal Revenue Service or other taxing authority.

Employer shall pay directly all legal, accounting and other costs and expenses
(including additional interest and penalties) incurred by Employer or Employee
in connection with any IRS Claim or Refund Claim, as applicable, and shall
indemnify Employee, on an after-tax basis, for any Excise Tax or income tax,
including related interest and penalties, imposed as a result of such payment of
costs or expenses.

(e)          If Employee receives any refund with respect to Excise Taxes,
Employee shall (subject to Employer’s complying with any applicable requirements
of Section 10(d)) promptly pay Employer the amount of such refund (together with
any interest paid or credited

 

20

 

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thereon after taxes applicable thereto). Any contest of a denial of refund shall
be controlled by Section 10(d).

(f)          409A Compliance. Any Gross-Up Payment made under this Agreement
shall be made no later than by the end of Employee’s taxable year next following
Employee’s taxable year in which he remits the Excise Taxes. In the event
Employee has a right to a Gross-Up Payment due to a tax audit or litigation
addressing the existence or amount of a tax liability, whether Federal, state,
local, or foreign, any Gross-Up Payment relating thereto will be made by the end
of Employee’s taxable year following Employee’s taxable year in which the taxes
that are the subject of the audit or litigation are remitted to the taxing
authority, or where as a result of such audit or litigation no taxes are
remitted, the end of Employee’s taxable year in which the audit is completed or
there is a final and nonappealable settlement or other resolution of the
litigation.

11.         Arbitration. Whenever a dispute arises between the parties
concerning this Agreement or any of the obligations hereunder, or Employee’s
employment generally, Employer and Employee shall use their best efforts to
resolve the dispute by mutual agreement. If any dispute cannot be resolved by
Employer and Employee, it shall be submitted to arbitration to the exclusion of
all other avenues of relief and adjudicated pursuant to the American Arbitration
Association’s Rules for Employment Dispute Resolution then in effect. The
decision of the arbitrator must be in writing and shall be final and binding on
the parties, and judgment may be entered on the arbitrator’s award in any court
having jurisdiction thereof. Employer shall pay any filing fees, administrative
fees, or arbitrator’s fees required by American Arbitration Association in
connection with any arbitration conducted under the terms of this Agreement. The
prevailing party in any such arbitration shall be entitled to recover from the
losing party all of its or Employee’s own costs and attorney’s fees incurred by
the prevailing party with respect to the arbitration. Nothing in this Section 11
shall be construed to derogate Employer’s rights to seek legal and equitable
relief in a court of competent jurisdiction as contemplated by Section 6(h).

12.         Non-Waiver. It is understood and agreed that one party’s failure at
any time to require the performance by the other party of any of the terms,
provisions, covenants or conditions hereof shall in no way affect the first
party’s right thereafter to enforce the same, nor shall the waiver by either
party of the breach of any term, provision, covenant or condition hereof be
taken or held to be a waiver of any succeeding breach.

13.         Severability. If any provision of this Agreement conflicts with the
law under which this Agreement is to be construed, or if any such provision is
held invalid or unenforceable by a court of competent jurisdiction or any
arbitrator, such provision shall be deleted from this Agreement and the
Agreement shall be construed to give full effect to the remaining provisions
thereof.

14.         Survivability. Unless otherwise provided herein, upon termination or
expiration of the Term, the provisions of Sections 6 through 18 above shall
nevertheless remain in full force and effect but shall under no circumstance
extend the Term of this Agreement (or the Executive’s right to accrue additional
benefits beyond the expiration of the Term as determined in accordance with
Section 1 but without regard to this Section).

 

21

 

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15.         Governing Law. This Agreement shall be interpreted, construed and
governed according to the laws of the State of Kansas without regard to the
conflict of law provisions thereof.

16.         Construction. The Section headings and captions contained in this
Agreement are for convenience only and shall not be construed to define, limit
or affect the scope or meaning of the provisions hereof. All references herein
to Sections shall be deemed to refer to numbered sections of this Agreement.

17.         Entire Agreement. This Agreement contains and represents the entire
agreement of Employer and Employee and supersedes all prior agreements,
representations or understandings, oral or written, express or implied with
respect to the subject matter hereof. This Agreement may not be modified or
amended in any way unless in a writing signed by each of Employer and Employee.
No representation, promise or inducement has been made by either Employer or
Employee that is not embodied in this Agreement, and neither Employer nor
Employee shall be bound by or liable for any alleged representation, promise or
inducement not specifically set forth herein.

18.         Assignability. Neither this Agreement nor any rights or obligations
of Employer or Employee hereunder may be assigned by Employer or Employee
without the other Party’s prior written consent. Subject to the foregoing, this
Agreement shall be binding upon and inure to the benefit of Employer and
Employee and their heirs, successors and assigns.

19.         Code Section 409A. This Agreement is intended to meet the
requirements of Section 409A of the Code and may be administered in a manner
that is intended to meet those requirements and shall be construed and
interpreted in accordance with such intent. To the extent that any payment or
benefit provided hereunder is subject to Section 409A of the Code, such payment
or benefit shall be provided in a manner that will meet the requirements of
Section 409A of the Code, including regulations or other guidance issued with
respect thereto, such that the payment or benefit shall not be subject to the
excise tax applicable under Section 409A of the Code. Any provision of this
Agreement that would cause any payment or benefit to fail to satisfy Section
409A of the Code shall be amended (in a manner that as closely as practicable
achieves the original intent of this Agreement) to comply with Section 409A of
the Code on a timely basis, which may be made on a retroactive basis, in
accordance with regulations and other guidance issued under Section 409A of the
Code.

20.         Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed properly given if delivered personally or sent by
certified or registered mail, postage prepaid, return receipt requested, or sent
by telegram, telex, telecopy or similar form of telecommunication, and shall be
deemed to have been given when received. Any such notice or communication shall
be addressed:

 

if to Employer, to

Euronet Worldwide, Inc.

Attention: General Counsel

4601 College Boulevard, Suite 300

Leawood, Kansas 66211

 

 

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if to Employee, to:

Kevin Caponecchi

 

 

 

 

 

 

 

 

or to such other address as Employer or Employee shall have furnished to the
other in writing.

21.        Indemnification. Employer agrees to indemnify, defend, and hold
Employee harmless to the greatest extent possible under applicable law from and
against any and all judgments, fines, penalties, and any other amounts
reasonably incurred by Employee (including attorneys’ fees) in connection with
any threatened or made claim, suit, or proceeding, whether civil, criminal,
administrative, or investigative, made against Employee by third-parties or any
governmental agency, arising out of, resulting from, or relating to the actions
or omissions undertaken by Employee in the course and scope of Employee’s duties
and responsibilities authorized and performed under the terms of this Agreement.

IN WITNESS WHEREOF, the Parties have duly executed this Agreement, to be
effective as of the date first above written.

 

Kevin Caponecchi

 

Euronet Worldwide, Inc.

a Delaware Corporation

 

 

 

 

 

 

/s/ Kevin J. Caponecchi

 

/s/ Jeffrey B. Newman

 

 

By:       Jeffrey B. Newman

 

 

Its:        Executive Vice President – General Counsel

 

 

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EXHIBIT A

All grants are to be made under and in accordance with the terms of Employer’s
2006 Stock Incentive Plan:

1.

A one-time grant of restricted stock units (“RSUs”) with a value (determined as
of the date of grant based on the closing market price of the shares of
Employer’s common stock underlying the RSUs) of $140,000, which will vest on
February 28, 2008, subject to Employee being continuously employed until the
vest date.

2.

A one-time grant of RSUs with a value (determined as of the date of grant based
on the closing market price of the shares of Employer’s common stock underlying
the RSUs) of $260,000, which will vest on July 1, 2008, subject to Employee
being continuously employed until the vest date.

3.

A one-time grant of RSUs with a value (determined as of the date of grant based
on the closing market price of the shares of Employer’s common stock underlying
the RSUs) of $155,000, one-half of such RSUs vesting on January 1, 2008 and the
second half vesting on January 1, 2009, subject to Employee being continuously
employed until such vest date.

The time-based vesting schedule applicable to the Promised Future Stock Awards
shall be such that 20% of the award will become vested on December 31 of the
calendar year immediately following the calendar year the Promised Future Stock
Award was granted (the “Initial Vest Date”). Additional 20% increments will vest
on each anniversary of the Initial Vest Date, in each case including on the
Initial Vest Date assuming Employee has been continuously employed since the
Effective Date.

The performance-based criteria applicable to the Future Promised Stock Awards
that are RSUs will be established as follows:

 

(1)

With respect to the RSUs granted in 2007, the performance criteria will be
determined by the Compensation Committee of the Board and Employer’s Chief
Executive Officer within 30 days of the Effective Date.

 

(2)

With respect to any RSUs granted in 2008, 2009, 2010 or 2011, the performance
criteria will be determined by the Compensation Committee at the same time as
other performance criteria for Employer’s other senior executive officers are
established and, unless mutually agreed to by the Compensation Committee and
Employee, will be based on the same or similar performance criteria as
established for similar compensation arrangements for Employer’s other senior
executive officers.

All RSUs granted either as a Future Promised Stock Award or as an Initial Award
shall provide for the payment of dividend equivalent payments prior to the
vesting of such awards.

 

24