STOCK PLANS

The Company has share-based compensation plans (“SCP”) that allow the Company to grant restricted shares, or options to purchase shares, of Common Stock to certain current and prospective key employees, directors and consultants of the Company. These awards generally vest over periods ranging from three to seven years from the date of grant, are generally exercisable during the shorter of a ten-year term or the term of employment with the Company. Certain stock option grants vest over a five-year period, subject to the achievement of a pre-determined share price target for Euronet Common Stock within three years from the grant date. With the exception of certain awards made to the Company's employees in Germany, awards under the SCP are settled through the issuance of new shares under the provisions of the SCP. For Company employees in Germany, certain awards are settled through the issuance of treasury shares, which also reduces the number of shares available for future issuance under the SCP. As of December 31, 2012, the Company has approximately 2.1 million in total shares remaining available for issuance under the SCP.

The Company's Consolidated Statements of Operations includes share-based compensation expense of $11.8 million, $10.8 million and $9.3 million for the years ended December 31, 2012, 2011 and 2010, respectively. The amounts are recorded as salaries and benefits expense in the accompanying Consolidated Statements of Operations. The Company recorded a tax benefit of $0.7 million, $0.6 million and $0.5 million during the years ended December 31, 2012, 2011 and 2010, respectively, for the portion of this expense that relates to foreign tax jurisdictions in which an income tax benefit is expected to be derived.

(a) Stock options

Summary stock options activity is presented in the table below:



	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (thousands)
Balance at December 31, 2011 (1,789,061 shares exercisable)	4,994,581		$	15.11
Granted	596,930		$	22.79
Exercised	(693,015	)	$	10.25
Forfeited	(76,823	)	$	16.47
Expired	(10,857	)	$	19.22
Balance at December 31, 2012	4,810,816		$	16.73	7.1	$	33,266
Exercisable at December 31, 2012	1,937,245		$	14.30	5.6	$	18,213
Vested and expected to vest at December 31, 2012	4,173,444		$	16.26	7.0	$	30,821

Options outstanding that are expected to vest are net of estimated future forfeitures. The Company received cash of $5.2 million, $2.0 million and $1.7 million in connection with stock options exercised during the years ended December 31, 2012, 2011 and 2010, respectively. The intrinsic value of these options exercised was $7.4 million, $2.0 million and $1.9 million during the years ended December 31, 2012, 2011 and 2010, respectively. As of December 31, 2012, unrecognized compensation expense related to nonvested stock options that are expected to vest totaled $15.5 million and will be recognized over the next 5 years, with an overall weighted-average period of 4.1 years. The following table provides the fair value of options granted under the SCP during 2012, 2011 and 2010, together with a description of the assumptions used to calculate the fair value using the Black-Scholes-Merton option-pricing model:



	Year ended December 31,
	2012			2011			2010
Volatility	43.9		%	45.1		%	43.5		%
Risk-free interest rate - weighted average	0.8		%	1.0		%	2.5		%
Risk-free interest rate - range	0.81% to 1.03%			0.99% to 2.33%			2.50% to 2.75%
Dividend yield	—		%	—		%	—		%
Assumed forfeitures	8.0		%	8.0		%	8.0		%
Expected lives	5.7 years			5.4 years			5.5 years
Weighted-average fair value (per share)	$	9.46		$	6.85		$	7.42

(b) Restricted stock

Restricted stock awards vest based on the achievement of time-based service conditions and/or performance-based conditions. For certain awards, vesting is based on the achievement of more than one condition of an award with multiple time-based

and/or performance-based conditions.

Summary restricted stock activity is presented in the table below:



	Number of Shares		Weighted Average Grant Date Fair Value
Nonvested at December 31, 2011	1,185,500		$	18.82
Granted	299,030		$	21.99
Vested	(343,871	)	$	17.98
Forfeited	(34,530	)	$	18.40
Nonvested at December 31, 2012	1,106,129		$	19.73

The fair value of shares vested during the years ended December 31, 2012, 2011 and 2010 was $6.9 million, $5.0 million and $3.9 million, respectively. As of December 31, 2012, there was $6.2 million of total unrecognized compensation cost related to unvested time-based restricted stock, which is expected to be recognized over a weighted-average period of 3.7 years. As of December 31, 2012, there was $7.6 million of total unrecognized compensation costs related to unvested performance-based restricted stock, which is expected to be recognized based on Company performance over a weighted-average period of 1.9 years. The weighted average grant date fair value of restricted stock granted during the years ended December 31, 2012, 2011 and 2010 was $21.99, $16.55 and $16.50 per share, respectively.

In 2003, the Company established a qualified Employee Stock Purchase Plan (the “ESPP”), which allows qualified employees (as defined by the plan documents) to participate in the purchase of rights to purchase designated shares of the Company's Common Stock at a price equal to the lower of 85% of the closing price at the beginning or end of each quarterly offering period. The Company reserved 1,000,000 shares of Common Stock for purchase under the ESPP. Pursuant to the ESPP, during the years ended December 31, 2012, 2011 and 2010, the Company issued 56,189, 57,018 and 46,849 rights, respectively, to purchase shares of Common Stock at a weighted average price per share of $15.42, $12.77 and $16.95, respectively. The grant date fair value of the option to purchase shares at the lower of the closing price at the beginning or end of the quarterly period, plus the actual total discount provided, are recorded as compensation expense. Total compensation expense recorded was $0.2 million for each of the years ended December 31, 2012, 2011 and 2010. The following table provides the weighted-average fair value of the ESPP stock purchase rights during the years ended December 31, 2012, 2011 and 2010 and the assumptions used to calculate the fair value using the Black-Scholes-Merton option-pricing model:



	Year Ended December 31,
	2012			2011			2010
Volatility - weighted average	29.7		%	39.9		%	31.0		%
Volatility - range	22.6% to 35.2%			26.5% to 52.5%			21.2% to 45.9%
Risk-free interest rate - weighted average	0.07		%	0.06		%	0.15		%
Risk-free interest rate - range	0.02% to 0.10%			0.02% to 0.11%			0.08% to 0.17%
Dividend yield	—		%	—		%	—		%
Expected lives	3 months			3 months			3 months
Weighted-average fair value (per share)	$	3.63		$	3.70		$	3.56