UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities
Exchange Act of 1934 (Amendment No.____
(Amendment No. )
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Definitive Proxy Statement. | ||||
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Soliciting Material Pursuant to §240.14a-12. |
NET 1 UEPS TECHNOLOGIES, INC. | ||||
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
to be held on November 29, 201019, 2013
To the Shareholders of Net 1 UEPS Technologies, Inc.:
NOTICE IS HEREBY GIVEN that the 20102013 Annual Meeting of Shareholders of Net 1 UEPS Technologies, Inc., a Florida corporation, will be held at our principal executive offices located at President Place, 6th Floor, Cnr. Jan Smuts Avenue and Bolton Road, Rosebank, Johannesburg, South Africa on November 29, 201019, 2013 at 16h00, local time, for the following purposes:
1. | To elect | ||
2. | To ratify the selection of Deloitte & Touche (South Africa) as | ||
3. | To hold an advisory vote to approve executive compensation. |
4. | To transact such other business and act upon any other matter which may properly come before the annual meeting or any adjournment or postponement of the meeting. |
Our Board of Directors has fixed the close of business on October 15, 20104, 2013 as the record date for determining shareholders entitled to notice of and to vote at the meeting. A list of the shareholders as of the record date will be available for inspection by shareholders at our principal executive offices during business hours for a period of ten days prior to the meeting.
Your attention is directed to our annual report for the fiscal year ended June 30, 2010,2013, which is enclosed with this proxy statement.
The Board of Directors, | ||||
Dr. Serge C. P. Belamant | ||||
Chairman and Chief Executive Officer | ||||
Johannesburg, South Africa
October 28, 2010
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE MEETING OF SHAREHOLDERS TO BE HELD ON NOVEMBER 29, 2010.19, 2013.A complete set of proxy materials relating to our annual meeting is available on the Internet. These materials, consisting of the Notice of Annual Meeting and Proxy Statement, including proxy card, and annual report, may be viewed and downloaded at http://materials.proxyvote.com/64107N
64107N.
You are cordially invited to attend the meeting in person. Whether or not you expect to attend the meeting, please complete, date, sign and return the proxy accompanying this notice as promptly as possible in order to ensure your representation at the meeting. A return envelope (which is postage prepaid if mailed in the United States) is enclosed for your convenience. Even if you have voted by proxy, you may still vote in person if you attend the meeting. Please note, however, that if your shares are held of record by a broker, bank or other agent and you wish to vote at the meeting, you must request and obtain a proxy issued in your name from that record holder. You may also submit your proxy via the Internet as specified in the accompanying Internet voting instructions. Shareholders registered on our South African Branch Register (“South African shareholders”) are referred to the special instructions contained on page 4 of this proxy statement.
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GeneralNET 1 UEPS TECHNOLOGIES, INC.
PROXY STATEMENT
We are furnishing this proxy statement is being furnished to shareholders of Net 1 UEPS Technologies, Inc., a Florida corporation, in connection with the solicitation by our Boardboard of Directors, or the Board,directors of proxies for use at the Annual Meetingannual meeting of Shareholdersshareholders to be held at President Place, 6th Floor, Cnr. Jan Smuts Avenue and Bolton Road, Rosebank, Johannesburg, South Africa on November 29, 201019, 2013 at 16h00, local time,time. Our annual report on Form 10-K and our proxy materials were first mailed on or about October 17, 2013.
Shareholders who owned our common stock at the close of business on October 4, 2013, the record date, may attend and vote at the annual meeting. Each share is entitled to one vote. There were 45,780,513 shares of common stock outstanding on the record date.
A majority of the total number of outstanding shares of common stock, present either in person or by proxy, will constitute a quorum for the transaction of business at the annual meeting. Shareholders who are present at the annual meeting in person or by proxy and who abstain, and proxies relating to shares held by a bank or broker on your behalf (that is, in “street name”), that are not voted (referred to as “broker non-votes”) will be treated as present for purposes of determining whether a quorum is present. In the event that there are not sufficient votes to approve any proposal at the annual meeting, the annual meeting may be adjourned in order to permit the further solicitation of proxies. The inspector of election appointed for the annual meeting will tabulate all votes and will separately tabulate affirmative and negative votes, abstentions and broker non-votes.
The following describes how you may vote on each proposal and the votes required for approval of each proposal:
• | Proposal No 1—Our six director nominees will be elected by a plurality of votes. You may vote for each director nominee or withhold your vote from one or more of the nominees. Withholding a vote as to any director nominee is the equivalent of abstaining. In an uncontested election such as this, abstentions and broker non-votes have no effect, since approval by a specific percentage of the shares present or outstanding is not required. |
• | Proposal No. 2—The ratification of the selection of Deloitte & Touche (South Africa) to act as our independent registered public accounting firm will be approved if the votes cast in favor of the proposal exceed the number of votes cast against the proposal. You may vote for or against the proposal or you may abstain from voting. Abstentions and broker non-votes will not affect the outcome of the vote. |
• | Proposal No. 3— The advisory vote to approve executive compensation will be approved if the votes cast in favor of the proposal exceed the number of votes cast against the proposal. You may vote for or against the proposal or you may abstain from voting. Abstentions and broker non-votes will not affect the outcome of the vote. |
If you provide your voting instructions on your proxy, your shares will be voted as you instruct, and according to the best judgment of the persons named in the proxy if a proposal comes up for a vote at the annual meeting that is not on the proxy.
If you do not indicate a specific choice on a proxy that you sign and submit, your shares will be voted:
FOR each of the director nominees;
FOR the ratification of the selection of Deloitte & Touche (South Africa) as our independent registered public accounting firm; and
FOR the approval of executive compensation.
If your shares are held in “street name,” and you do not instruct the bank or broker as to how to vote your shares on Proposals 1 or 3, the bank or broker may not exercise discretion to vote for or against those proposals. This would be a “broker non-vote” and these shares will not be counted as having been voted on the applicable proposal. With respect to Proposal 2, the bank or broker may exercise its discretion to vote for or against that proposal in the absence of your instruction.Please instruct your bank or broker so your vote can be counted.
The Board of Directors recommends:
a voteFOR each of the director nominees;
a voteFOR ratification of Deloitte & Touche (South Africa) as our independent registered public accounting firm;
a voteFOR the approval of executive compensation.
Revocability of Proxies
You may revoke your proxy at any adjournment or postponementtime prior to exercise of the proxy by delivering a written notice of revocation or a duly executed proxy with a later date by mail to our corporate secretary at Net 1 UEPS Technologies, Inc., P O Box 2424, Parklands 2121, Gauteng, South Africa, or by attending the meeting and voting in person. If you hold shares through a bank or brokerage firm, you must contact that firm to revoke any prior voting instructions.
Internet Availability of Proxy Materials and Annual Report
A complete set of proxy materials relating to our annual meeting.
Market Information
Our common stock is listed on The Nasdaq Global Select Market, or Nasdaq, in the United States under the symbol “UEPS” and on the JSE Limited, or JSE, in South Africa under the symbol “NT1.” The Nasdaq is our principal market for the trading of our common stock. Our transfer agent in the United States is Computershare Shareowner Services LLC, 480 Washington Blvd, Jersey City, New Jersey, 07310. Our transfer agent in South Africa is Link Market Services South Africa (Pty) Ltd (“Link Market”), 13th Floor, Rennie House, 19 Ameshoff Street, Braamfontein, 2001, South Africa.
Special Instructions to South African Shareholders
We are required to comply with certain South African regulations related to circulation and tabulation of proxies issued to our South African shareholders. The proxy form marked “Net 1
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The terms of office of each of our current directors will expire at the annual meeting or at such time as their successors shall be elected and qualified.meeting. The Board has determined to nominate for re-election each of our current directors (see “Information Regarding the Nominees” for information on all directors) for a one-year term expiring at the annual meeting of shareholders in 2011 or until their successors shall be duly elected and qualified.
The persons named in the enclosed proxy intend to vote properly executed and returned proxiesFORthe election of all nominees proposed by the Board unless authority to vote is withheld. In the event that any nominee is unable or unwilling to serve, the persons named in the proxy will vote for such substitute nominee or nominees as they, in their discretion, shall determine. The Board has no reason to believe that any nominee named herein will be unable or unwilling to serve.
The Board recommends that you vote FOR election of each of itsthe director nominees.
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Dr. Serge C. P. Belamant 60 years old Director since 1997 | Dr. Belamant founded our company and has been our | |
The Board believes that Dr. Belamant’s strategic vision, technological ingenuity and extensive knowledge of the payments industry makes him an invaluable member of the Board. Dr. Belamant | ||
Herman G. Kotzé 44 years old Director since 2004 | ||
Mr. Kotzé has been our | ||
Accountants at KPMG. The Board believes that Mr. |
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Christopher S. Seabrooke 60 years old Director since 2005 | ||
Mr. Seabrooke is | ||
The Board believes that Mr. |
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Alasdair J. K. Pein 53 years old Director since 2005 | Mr. Pein | |
The Board believes that Mr. Pein’s financial and accounting expertise, as well as his private equity experience and skills in dealing with compensation, human resources and corporate governance issues, makes him a valuable member of our Board. | ||
Paul Edwards 59 years old Director since 2005 | ||
Mr. Edwards | is Executive Chairman of Emerging Markets Payments Holdings, an Africa and Middle East payments business. Mr. Edwards has been | |
The Board believes that Mr. Edwards’ knowledge and experience of the telecommunications industry, especially in Africa, provides us with valuable insight into the potential opportunities to expand our business internationally. |
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Brian K. Mosehla 41 years old Director since 2012 | ||
Mr. | ||
Johannesburg in 1995. The Board believes that Mr. |
The Audit Committee of our Board has proposed that Deloitte & Touche (South Africa) be selected to serve as independent registered public accounting firm for the fiscal year ending June 30, 2011.2014. A representative of Deloitte is expected to be present at the annual meeting. Such representative will have an opportunity to make a statement if he or she desires to do so and is expected to be available to respond to appropriate questions from shareholders. Deloitte currently serves as our independent registered public accounting firm.
We are asking our shareholders to ratify the selection of Deloitte as our independent registered public accounting firm for the fiscal year ending June 30, 2011.2014. Although ratification is not required by our by-laws or otherwise, the Board is submitting the selection of Deloitte to our shareholders for ratification as a matter of good corporate practice. In the event our shareholders fail to ratify the appointment, the Audit Committee may reconsider this selection. Even if the selection is ratified, the Audit Committee in its discretion may select a different registered public accounting firm at any time during the year if it determines that such a change would be in our best interests and the best interests of our shareholders.
The Board recommends a vote FOR ratification of the selection of Deloitte.
We are providing you with the opportunity to vote to approve, on an advisory, non-binding basis, the compensation of our executive officers named in the Summary Compensation Table under “Executive Compensation,” whom we refer to as our “named executive officers” or NEOs. This proposal, which is commonly referred to as “say on pay,” is required by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which added Section 14A to the Securities Exchange Act of 1934, or Exchange Act.
The philosophy of our executive compensation program is to link compensation to the achievement of our key strategic and financial goals. Therefore, we reward our executives for their contributions to our annual and long-term performance by tying a significant portion of their total compensation to key drivers of increased shareholder value. At the same time, we believe our program does not encourage excessive risk-taking by management. The “Executive Compensation” section of this proxy statement beginning on page 13, including the “Compensation Discussion and Analysis,” describes in detail our executive compensation program and the decisions made by the Board’s Remuneration Committee with respect to our fiscal year ended June 30, 2013.
The Board is asking shareholders to cast a non-binding advisory vote on the following resolution:
“Resolved, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to the disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, compensation tables and narrative discussions, is approved on a non-binding advisory basis.”
Because your vote is advisory, it will not be binding upon the Board or the Remuneration Committee. However, the Board and the Remuneration Committee value the opinions expressed by our shareholders and will consider the outcome of the vote when considering future executive compensation decisions.
The Board recommends a vote FOR approval of the compensation of our named executive officers.
Our Board typically holds a regular meeting once every quarter and holds special meetings when necessary. During the fiscal year ended June 30, 2010,2013, our Board held a total of sixfive meetings. All of the directors who served during our 20102013 fiscal year attended or participated in more than 75%100% of the meetings of the Board. All of the directors attended 100% of the aggregate number of meetings of the Board and meetings of those committees of the Board on which such director served during the year. We encourage each member of the Board to attend the annual meeting of shareholders, but have not adopted a formal policy with respect to such attendance.Four
All of our directors who served during fiscal 20102013 attended last year’s annual meeting.meeting, except Mr. Pein. The non-management directors meet regularly without any management directors or employees present. These meetings are held on the day of or day preceding other Board or committee meetings.
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The Board has established an Audit Committee, a Remuneration Committee and a Nominating and Corporate Governance Committee. The members of our Board Committees are presented in the table below:
Director | Audit Committee | Remuneration Committee | Nominating and Corporate Governance Committee | |||
Dr. Serge C.P. Belamant (#) | ||||||
Paul Edwards | X | X | X | |||
Herman G. Kotzé (#) | ||||||
Brian K. Mosehla | ||||||
Alasdair J.K. Pein | X | | X | |||
Christopher S. Seabrooke | | X | | |||
# | Executive | |
* | Chairperson |
Audit Committee
The Audit Committee consists of Messrs. Seabrooke, Pein and Edwards, with Mr. Seabrooke acting as the chairperson. The Board has determined that Mr. Seabrooke is an “audit committee financial expert” as that term is defined in applicable Securities and Exchange Commission, or SEC, rules, and that all three members meet Nasdaq’s financial literacy criteria. The Audit Committee held eightnine meetings during the 20102013 fiscal year. See “Audit Committee Report” on page 27.
The Audit Committee was established by the Board for the primary purpose of overseeing or assisting the Board in overseeing the following:
the integrity of our financial statements;
our compliance with legal and regulatory requirements;
the qualifications and independence of our registered public accounting firm;
the performance of our independent auditors and of the internal audit function;
the accounting and financial reporting processes and the audits of our financial statements; and
our systems of disclosure controls and procedures, internal controls over financial reporting, and compliance with ethical standards adopted by us.
A copy of our Audit Committee charter is available without charge on our website,www.net1.com under the “Investor Relations — Relations—Governance” section.
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The Remuneration Committee comprises Messrs. Pein, Seabrooke Edwards, Tinsley and Ball,Edwards, with Mr. Pein acting as the chairperson. The Remuneration Committee held four meetings during the 20102013 fiscal year. The Remuneration Committee has the following principal responsibilities, authority and duties:
review and approve performance goals and objectives relevant to the compensation of all our executive officers, evaluate the performance of each executive officer in light of those goals and objectives, and set each executive officer’s compensation, including incentive-based and equity-based compensation, based on such evaluation;
make recommendations to the Board with respect to incentive and equity-based compensation plans;
review and make recommendations to the Board regarding compensation-related matters outside the ordinary course, including but not limited to employment contracts, change-in-control provisions and severance arrangements;
administer our stock option, stock incentive, and other stock compensation plans, including the function of making and approving all grants of options and other awards to all executive officers and directors, and all other eligible individuals, under such plans;
review annually and make recommendations to the Board regarding director compensation;
assist management in developing and, when appropriate, recommend to the Board, the design of compensation policies and plans;
review and discuss with management the disclosures in our “Compensation Discussion and Analysis” and any other disclosures regarding executive compensation to be included in our public filings or shareholder reports; and
recommend to the Board whether the Compensation Discussion and Analysis should be included in our proxy statement, Form 10-K, or information statement, as applicable, and prepare the related report required by the rules of the SEC.
A copy of our Remuneration Committee charter is available without charge on our website,www.net1.com under the “Investor Relations — Relations—Governance” section.
Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee comprises Messrs. Seabrooke, Ball, Pein Edwards and Tinsley,Edwards, with Mr. Seabrooke acting as the chairperson. The Nominating and Corporate Governance Committee held four meetingsone meeting during the 20102013 fiscal year. The principal duties and responsibilities of the Nominating and Corporate Governance Committee are as follows:
monitor the composition, size and independence of the Board;
establish criteria for Board and committee membership and recommend to our Board proposed nominees for election to the Board and for membership on each committee of the Board; monitor our procedures for the receipt and consideration of director nominations by shareholders and other persons and for the receipt of shareholder communications directed to our Board; make recommendations regarding proposals submitted by our shareholders; |
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establish and monitor procedures by which the Board will conduct, at least annually, evaluations of its performance;
review our Corporate Governance Guidelines annually and recommend changes, as appropriate, for review and approval by the Board; and
make recommendations to the Board regarding management succession planning and corporate governance best practices.
A copy of our Nominating and Corporate Governance Committee charter is available without charge on our website,www.net1.com under the “Investor Relations — Relations—Governance” section.
Board Leadership
Our Board of Directors is led by our Chairman, Dr. Serge Belamant, who is also our Chief Executive Officer. The Board believes that Dr. Belamant’s service as both Chairman of the Board and Chief Executive Officer is in our best interests and the best interests of our shareholders.
A combined Chairman and Chief Executive Officer leadership structure is commonly utilized by public companies in the United States, and our Board believes that this leadership structure has been effective for us and minimizes the potential for duplication of efforts and conflict of roles. Dr. Belamant possesses detailed and in-depth knowledge of the issues, opportunities and challenges facing us, and is thus better positioned than a non-employee chairman to focus the Board’s time and attention on the matters that are most critical to us. Additionally, having one person serve as both Chairman of the Board and Chief Executive Officer enables decisive leadership, ensures clear accountability and enhances our ability to communicate our message and strategy clearly and consistently to our shareholders, employees, customers and suppliers.
While our Bylaws do not require that the roles of Chairman of the Board and Chief Executive Officer be filled by the same person, our Board believes that having Dr. Belamant fill both positions is the appropriate leadership structure for us.
We do not have a lead director. The Board believes that all of our independent directors are active and engaged Board members and that a number of them fulfill a lead director role at various times depending upon the particular issues involved. Further, Mr. Seabrooke, who is the Chairman of both the Nominating and Corporate Governance Committee and the Audit Committee and is a member of the Remuneration Committee, presides over all executive sessions of the independent directors.
The Board’s Role in Risk Oversight
Managing risk is an ongoing process inherent in all decisions made by management. The Board of Directors discusses risk throughout the year, particularly at Board meetings when specific actions are considered for approval. The Board of Directors has ultimate responsibility to oversee our enterprise risk management program. This oversight is conducted primarily through various committees of the Board as described below.
Our Enterprise Risk Management Committee which comprises our Chief Financial Officer (who serves as chair) and the leaders of our various business units and which is responsible for identifying, assessing, prioritizing and developing action plans to mitigate the material business, operational and strategic risks affecting us. In addition,
The Enterprise Risk Management Committee comprises our Chief Executive Officer (who serves as chair), Chief Financial Officer and Group Compliance Officer. Meetings of the Enterprise Risk Management Committee meetings are also attended and coordinated by third-party advisors that assist us with developments in the risk management arena.leaders of our various business units. The Enterprise Risk Management Committee meets and reports to the Audit Committee on a quarterly basis.
10semi-annually.
None of the members of our Remuneration Committee has at any time been one of our officers or employees. None of our executive officers serves or in the past has served as a member of the Board or remuneration committee of any entity that has one or more of its executive officers serving on our Board or our Remuneration Committee.
The Nominating and Corporate Governance Committee reviews with the Board the skills and characteristics required of Board members. Our Corporate Governance Guidelines provide that the committee will consider a candidate’s independence, as well as the perceived needs of the Board and the candidate’s background, skills, business experience and expected contributions. At a minimum, members of the Board must possess the highest professional ethics, integrity and values, and be committed to representing the long-term interests of our shareholders. They must also have an inquisitive and objective perspective, practical wisdom and mature judgment. The committee may also take into account the benefits of diversity in candidates’ viewpoints, background and experience, as well as the benefits of constructive working relationships among directors. Other than as set forth in our Corporate Governance Guidelines, the committee does not have a formal policy with respect to diversity.
The Nominating and Corporate Governance Committee also reviews and determines whether existing members of the Board should stand for re-election, taking into consideration matters relating to the number of terms served by individual directors, the ability of an individual director to devote the appropriate level of time and attention to Board duties in light of other positions he holds (including other directorships) and the changing needs of the Board. We do not have a limit on the number of terms an individual may serve as a director on our Board.
The Nominating and Corporate Governance Committee utilizes a variety of methods for identifying and evaluating nominees for director. The committee regularly assesses the appropriate composition, size and independence of the Board, and whether any vacancies are expected due to change in employment or otherwise. In the event that vacancies are anticipated, or otherwise arise, the committee considers various potential candidates for director. Candidates are evaluated at regular or special meetings of the Nominating and Corporate Governance Committee, and may be considered at any point during the year. The committee will consider shareholder recommendations for candidates for the Board that are properly submitted in accordance with Section 4.16 of our by-laws in the same manner it considers nominees from other sources. In evaluating such recommendations, the committee will use the qualifications standards described above and will seek to achieve a balance of knowledge, experience and capability on the Board.
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Any shareholder who wishes to communicate directly with the Board may do so via mail or facsimile, addressed as follows:
Net 1 UEPS Technologies, Inc.
Board of Directors
P O Box 2424
Parklands, 2121, Gauteng, South Africa
Fax: 27 11 880 7080
The corporate secretary shall transmit any communication to the Board, or individual director(s), as applicable, as soon as practicable upon receipt. Absent safety or security concerns, the corporate secretary shall relay all communications, without any other screening for content.
The Board has adopted a set of corporate governance guidelines. We will continue to monitor our corporate governance guidelines and adopt changes as necessary to comply with rules adopted by the SEC and Nasdaq, and to conform to best industry practice. This monitoring will include comparing our existing policies and practices to policies and practices suggested by various groups or authorities active in corporate governance and the practices of other public companies. A copy of our corporate governance guidelines is available on our website atwww.net1.com under the “Investor Relations – Relations—Governance” section.
The Board has adopted a written code of ethics, as defined in the regulations of the SEC. We require all directors, officers, employees, contractors, consultants and temporary staff, including our Chief Executive Officer, Chief Financial Officer and Principal Accounting Officer or controller and other senior personnel performing similar functions, to adhere to this code in addressing the legal and ethical issues encountered in conducting their work. Our code of ethics requires avoidance of conflicts of interest, compliance with all laws and other legal requirements, conduct of business in an honest and ethical manner, integrity and actions in our best interest. Directors, officers and employees are required to report any conduct that they believe in good faith to be an actual or apparent violation of the code. The Sarbanes-Oxley Act of 2002 requires companies to have procedures to receive, retain and treat complaints received regarding accounting, internal accounting controls or auditing matters and to allow for the confidential and anonymous submission by employees of concerns regarding questionable accounting or auditing matters. We currently have such procedures in place. A copy of our code of ethics is available upon request made either by mail to our corporate secretary at Net 1 UEPS Technologies, Inc., P O Box 2424, Parklands 2121, Gauteng, South Africa or by telephone to our Investor Relations Department at + 1 212-626-6675.917-767-6722. A copy of our code of ethics is also available free of charge on our website atwww.net1.com under the “Investor Relations – Relations—Governance” section.
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Directors who are also executive officers do not receive separate compensation for their services as directors. During fiscal 2010,2013, our non-executivenon-employee directors received compensation as described below.
Fees Earned or Paid | ||||||||||||
Name | in Cash | Stock Awards | Total | |||||||||
Antony Ball | $ | 50,000 | $ | 25,000 | (1) | $ | 75,000 | |||||
Paul Edwards | $ | 65,000 | $ | 35,000 | (2) | $ | 100,000 | |||||
Alasdair Pein | $ | 80,000 | $ | 50,000 | (3) | $ | 130,000 | |||||
Christopher Seabrooke | $ | 100,000 | $ | 50,000 | (3) | $ | 150,000 | |||||
Tom Tinsley | $ | 50,000 | $ | 25,000 | (1) | $ | 75,000 |
Name | Fees Earned or Paid in Cash ($) | Stock Awards(1)(2) ($) | Stock Options ($) | Total ($) | ||||||||||||
Antony C. Ball (3) | — | 22,500 | — | 22,500 | ||||||||||||
Paul Edwards | 71,500 | 35,750 | — | 107,250 | ||||||||||||
Brian K. Mosehla | 55,000 | 22,500 | — | 77,500 | ||||||||||||
Alasdair J.K. Pein | 96,000 | 48,000 | — | 144,000 | ||||||||||||
Christopher S. Seabrooke (4) | 170,000 | 60,000 | — | 230,000 |
(1) | As of June 30, 2013, the number of shares of restricted stock held by each non-employee director is as follows: Mr. Ball—0; Mr. Edwards—8,896; Mr. Mosehla—4,287; Mr. Pein—11,418; Mr. Seabrooke—14,683. |
(2) | Represents |
(4) | Fees earned or paid in cash ($) includes $50,000 paid to Mr. Seabrooke in recognition of the | |
In determining fiscal 2013 compensation, the Board made determinations of fiscal 2010 total compensation based on analysis ofanalyzed the annual compensation of non-executivenon-employee directors of USUS- and UK-listed transaction processor companies with a range of market equity capitalizations above, below and comparable to ours. The peer group comprised: Fiserv Inc.,Micros Systems Inc, Heartland Payment Systems, Inc., Global Payments Inc., Wright Express Corporation, Euronet Worldwide, Inc., Total System Services, Inc., Verifone Systems, Inc., Jack Henry & Associates, Inc. and Dimension Data Holdings Plc. This peer group is similar toSage Group plc. In addition, the peer group used to determine our executive officers’ compensation.
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The following table sets forth information regarding our compensation plans under which our equity securities are authorized for issuance as of June 30, 2010:
Number of | ||||||||||||
securities | ||||||||||||
Number of | remaining available | |||||||||||
securities to be | for future issuance | |||||||||||
issued upon | Weighted average | under equity | ||||||||||
exercise of | exercise price of | compensation plans | ||||||||||
outstanding | outstanding | (excluding | ||||||||||
options, warrants | options, warrants | securities | ||||||||||
and rights | and rights | reflected in column | ||||||||||
Plan Category | (a) | (b) | (a))(c) | |||||||||
Equity compensation plans approved by security holders | ||||||||||||
Amended and Restated 2004 Stock Incentive Plan | 1,675,580 | $ | 19.54 | 3,370,506 | ||||||||
Equity compensation plans not approved by security holders | ||||||||||||
Stock options granted to employees of Prism Holdings Limited (“Prism”)(1) | 132,040 | $ | 22.51 | — | ||||||||
Total | 1,807,620 | 3,370,506 | ||||||||||
Plan Category | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | Weighted average exercise price of outstanding options, warrants and rights (b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | |||||||||
Equity compensation plans approved by security holders | ||||||||||||
Amended and Restated Stock Incentive Plan | 2,550,820 | $ | 14.87 | 1,947,097 | ||||||||
Equity compensation plans not approved by security holders | ||||||||||||
Stock options granted to employees of Prism Holdings Proprietary Limited group (“Prism”)(1) | 97,763 | $ | 22.51 | — | ||||||||
|
|
|
|
|
| |||||||
Total | 2,648,583 | 1,947,097 | ||||||||||
|
|
|
|
|
|
(1) | In connection with the acquisition of Prism in July 2006, we granted Prism employees options to purchase shares of common stock at an exercise price of $22.51 per share, which was the average of the high and low sale prices of the common stock on the date of grant. These options |
As part of its responsibilities to annually review all incentive compensation and equity-based plans, and evaluate whether the compensation arrangements of our employees incentivize unnecessary and excessive risk-taking, the Remuneration Committee evaluated the risk profile of our compensation policies and practices for fiscal 20102013 and concluded that they do not motivate imprudent risk taking. In its evaluation, the Remuneration Committee reviewed our employee compensation structures, and noted numerous design elements that manage and mitigate risk without diminishing the incentive nature of the compensation, including:
a balanced mix between cash and equity, and annual and longer-term incentives;
caps on incentive awards at reasonable levels;
linear payouts between target levels with respect to annual cash incentive awards;
discretion on individual awards;awards, particularly in special circumstances; and
long-term incentives.
14
In addition, the Remuneration Committee analyzed our overall enterprise risks and how compensation programs may impact individual behavior in a manner that could exacerbate these enterprise risks. For this purpose, the Remuneration Committee considered our growth and return performance, volatility and leverage. In light of these analyses, the Remuneration Committee concluded that it has a balanced pay and performance program that does not encourage excessive risk-taking that is reasonably likely to have a material adverse effect on us. We believe our compensation programs encourage and reward prudent business judgment and appropriate risk-taking over the long term.
Fiscal 2013 Compensation Summary
Base salary—Base salary represents a significant portion of compensation, given the highly cash generative nature of our business. None of our named executive officers received a base salary increase during fiscal 2013;
CEO/CFO bonuses in lieu of the cash incentive awards—In November 2012, we established an annual cash incentive award plan for fiscal 2013 for Dr. Serge Belamant, our Chief Executive Officer and Mr. Herman Kotzé, our Chief Financial Officer, as we had done in prior years. The plan was intended to link payment to the achievement of specific financial performance (quantitative) goals on a company-wide basis, and operational (qualitative) goals. However, as a result of unforeseen developments affecting us, in particular, significantly higher SASSA implementation costs, continued litigation relating to the SASSA tender award and the SEC/DOJ investigations, the Remuneration Committee determined, after much consideration, that the plan as originally envisaged did not provide an adequate tool by which to measure the performance of Dr. Belamant and Mr. Kotzé for fiscal 2013. Consequently, the Remuneration Committee decided to award bonuses in lieu of cash incentive awards in the amounts reflected on the Summary Compensation Table based on the Committee’s judgment and assessment of the accomplishments of Dr. Belamant and Mr. Kotzé during the year. We describe the reasons for the Remuneration Committee’s decisions in more detail below under “Elements of 2013 Compensation” on page 19;
Bonuses for Messrs. Oh and Soma—Mr. Phil-Hyun Oh, President of KSNET, received 100% of his annual conditional guaranteed bonus under the terms of his employment agreement. Mr. Nitin Soma, our Senior Vice President—Information Technology, received a bonus of $72,000 for fiscal 2013;
Stock-based awards—We made an annual award of stock options with time-based vesting provisions to a group that included Dr. Belamant and Messrs. Kotzé and Soma.
Mr. Oh was compensated solely under the terms of his employment agreement.
Overview
The goal of our executive compensation program is the same as our goal for operating the company—to create long-term value for our shareholders. To achieve this goal, we seek to reward our named executive officers for sustained financial and operating performance and leadership excellence, to align their interests with those of our shareholders and to encourage them to remain with us for long and rewarding careers. This section of the proxy statement explains how our compensation program is designed and operates in practice with respect to the threefour individuals who comprised our named executive officers at the end of our 20102013 fiscal year—our Chief Executive Officer, our Chief Financial OfficerDr. Belamant and our Senior Vice President-Information Technology.Messrs. Kotzé, Oh and Soma. Our named executive officers have the broadest job responsibilities and are the only individuals who have policy-making authority.
Each element of our executive compensation program is designed to fulfill one or more of our performance, alignment and retention objectives. These elements consist of salary, bonus and both equity and non-equity incentive compensation. Each named executive officer receives one or more, but not necessarily all, of these elements. In determining the type and amount of compensation for each executive officer, we focus on both current pay and the opportunity for future compensation and seek to combine compensation elements so as to optimize his or her contribution to us. We consider the mix of our compensation components from year to year based on our overall performance, an executive’s individual contributions, and compensation practices of other US- and UK-based public companies including companies in our “peer group” described below. We do not have an exact formula for allocating between cash and non-cash compensation. We do, nonetheless, provide for a balanced mix of compensation components that are designed to encourage and reward behavior that promotes shareholder value in both the short and long term.
The chart below illustrates the mix of the elements of the 2013 compensation program we established for our named executive officers, has had a long and distinguished career with us. In particular, our Chief Executive Officer foundedusing target levels for the Company and developed the technology on which our products are based.cash incentive component.
Compensation Objectives
Performance. We reward excellent performance by our named executive officers and motivate them to continue to produce superior, long-term results through a combination of cash bonuses, incentive payments that depend on achievement of pre-defined levels of financial and operating goals and equity awards in the form of stock options or restricted stock that derive their value from increases in our share price and/or satisfaction of other financial and strategic performance goals. Base salary, bonus and non-equity incentive compensation are designed to reward annual achievements and be commensurate with each executive officer’s scope of responsibility, demonstrated ingenuity, dedication, and leadership and management effectiveness. Equity incentive compensation generally focuses on achievement of longer term results.
15
Retention. Our executive officers and theThe Remuneration Committee recognizerecognizes that the talent pool in South Africa is more limited than in other more developed countries. Even more significantly,In addition, the long tenure of our named executive officersSouth Africa-based management team, in particular, Dr. Belamant and Messrs. Kotzé and Soma, has made them especially knowledgeable about our business and industry and thus particularly valuable to us. Dr. Belamant in particular has intricate knowledge of, and has created large parts of the Company.proprietary technology and software deployed by us in our operations, which is an indispensable part of our technological advantage in our various operations and future developments in our growth pipeline. We wish to avoid losing these long-tenured officers and their invaluable knowledge, particularly given how important they are to theour future performance of the Company.performance. Therefore, retention is a key objective of our executive compensation program. We attempt to retain our key employees, including our named executive officers by seeking to provide a competitive pay package and using continued service as a condition to receipt of full compensation. The extended vesting terms of stock options and restricted stockequity awards have the effect of tying this element of compensation to continued service with us.
Implementing our Objectives
Process for Determining Compensation.A substantial amount of the Remuneration Committee’s responsibilities and efforts relate to the determination of compensation for our named executive officers. The Remuneration Committee obtainsanalyzes compensation data compiled from executive compensation surveys which include data gathered from annual reports and proxy statements of companies that it selects as a “peer group” forpeer group to better understand how our pay package compares with those companies. The Remuneration Committee then uses this knowledge to develop our executive compensation analysis purposes. The Remuneration Committee’s goalprogram based on its judgment of what is thatappropriate and necessary to fulfill and maintain our staffing needs. As described in more detail below, it considers internal pay equity as between the total cashChief Executive Officer and the Chief Financial Officer and uses a formulaic approach to set the Chief Financial Officer’s compensation relative to the Chief Executive Officer’s compensation but does not do so for ourthe other named executive officers be at the 75th percentile and the overall equity compensation for named executive officers should be within the range of the 50th to 75th percentiles when our financial performance equals the average of ourofficers.
The peer group companies on a size and value-weighted basis. Because of the high proportion of cash compensation that is at risk,selected by the Remuneration Committee reserves the right to adjust total cash compensation to be higher or lower, when our financial performance exceeds thatcomprises a broad spectrum of our peer group companies, or is lower than that of our peer group companies, as the case may be. Ourwhich range significantly in size from a revenue, profitability and enterprise value perspective. The peer group consists of payment processing companies generally considered comparable to us in terms of their businesses (such as being a payment systems provider) as well as other companies within other parts of the information technology sector and those engaged in emerging markets. The Remuneration Committee’s intent generally is to choose peer group members that have one or more attributes significantly similar to us, such as that of being a payment systems provider.
Our peer group, which includes both US and UK listed companies, consists of the following companies: FiservMicros Systems Inc., Heartland Payment Systems, Inc., Global Payments Inc., Wright Express Corporation, Euronet Worldwide, Inc., Heartland Payment Systems, Inc., Total System Services, Inc., Verifone Systems, Inc., Jack Henry & Associates, Inc. and Dimension Data Holdings Plc.
16Sage Group plc.
Compensation for fiscal 2013 for Mr. Oh was determined in accordance with his employment agreement. Mr. Oh’s compensation is denominated and paid in Korean won (KRW) in accordance with the terms of his negotiated employment agreement. Under the employment agreement, he receives a base salary and is entitled to receive a cash incentive payment based upon the achievement of certain targets that are linked to the operating performance of KSNET. We had expected to align KSNET’s year end with ours, however, it is not practicable at this stage to make this change. Accordingly, we determined Mr. Oh’s cash incentive payment for the twelve month period ended December 2012.
Before the Remuneration Committee makes decisions on compensation for the year, it discusses with our Chief Executive OfficerDr. Belamant each executive officer’s performance during the year, his or her accomplishments and specific areas of progress. Our Chief Executive OfficerDr. Belamant bases his evaluation on his knowledge of each executive officer’s performance (with due regard to the operational environment) and targets that have been set for a particular performance period. The executive officers are then evaluated based on their individual performance during the fiscal year. The Chief Executive OfficerDr. Belamant makes a recommendation to the Remuneration Committee on each executive officer’s compensation, except for his own and the Chief Financial Officer’sMr. Kotzé’s compensation. Executive officers do not propose or seek approval for their own compensation. Our Chief Executive Officer’sDr. Belamant’s and Chief Financial Officer’sMr. Kotzé’s annual performance review is developed by the Remuneration Committee as a whole. For our Chief Executive Officer’s and Chief Financial Officer’s reviews, formal feedback is received from the non-employee directors.
The Remuneration Committee also consults with our Chief Executive OfficerDr. Belamant and Chief Financial OfficerMr. Kotzé regarding non-executive officer employee compensation and is responsible for approving all awards under our Stock Incentive Plan.
Equity Grant Practices.We believe that long-term performance of our company is achieved through a culture that encourages suchlong-term performance by our executive officers through the use of stock and stock-based awards. Accordingly, awards of stock options and restricted stock are a fundamental element in our executive compensation program because they emphasize long-term performance, as measured by creation of shareholder value, and foster a commonality of interest between shareholders and employees. We have granted equity awards through our Stock Incentive Plan which was adopted by our Board of Directors and approved by our shareholders to permit the grant of stock options and other stock-based awards to our employees, directors and consultants. Options granted under the plan vest ratably over a period of three to five years after grant unless otherwise provided in a particular award agreement and have ten-year terms from the date of grant.
In determining the size of an equity award to an executive officer, the Remuneration Committee considers the executive’s then current cash total compensation package (which includes salary, potential bonus and cash incentive award plan compensation), any previously received equity awards, the value of the grant at the time of award and the number of shares available for grants pursuant to our Stock Incentive Plan.
17
No Employment Agreements. Our executive officersSouth African resident executives are all employed on an “at will” basis, without employment agreements, severance payment arrangements (except as required by local labor laws), or payment arrangements that would be triggered by a change in control. The absence of such arrangements enables us to terminate the employment of ourthese named executive officers with discretion as to the terms of any severance arrangement that might be provided upon such termination. This is consistent with our performance-based employment and compensation philosophy. We do have restraint of trade agreements with each of ourthese named executive officers. The terms of these agreements provide that upon the termination of the executive’s employment, the executive is restricted, for a period of 24 months, from soliciting business from certain customers, working for or holding interests in our competitors or participating in a competitive activity within the territories where we do business.
However, we do from time to time enter into employment agreements with senior executives of companies that we acquire in connection with and as a condition to the acquisition. Compensation under that initial employment agreement would not ordinarily be determined by reference to peer group comparisons. We entered into an employment agreement with Mr. Oh in October 2010 in connection with our acquisition of KSNET. Under this employment agreement, which expires on June 30, 2014, Mr. Oh receives the following cash compensation: (i) an annual base salary of KRW 375 million for the entire term, (ii) an annual conditional guaranteed bonus of KRW 200 million and (iii) an annual conditional incremental bonus equal to 2.72% of base salary multiplied by an operating profit growth multiple. The annual guaranteed bonus is conditioned on KSNET achieving operating profit in a fiscal year (defined as KSNET net income before interest, taxation and the conditional guaranteed bonus and the conditional incremental bonus), that is greater or equal to operating profit for the immediately preceding fiscal year. Operating profit growth multiple is the amount (expressed in percentage terms), if any, beyond which operating profit in a fiscal year exceeds operating profit for the immediately preceding fiscal year by 15%. The combined conditional guaranteed and incremental bonus is limited to 125% of annual base salary. We agreed that a fiscal year would end in December because we did not change the year end of KSNET from December to June as was initially contemplated when signing the employment agreement with Mr. Oh. Accordingly, Mr. Oh’s annual conditional guaranteed and incremental bonuses are calculated on the 12 month period ended December 31, 2012, for the purposes of fiscal 2013.
Under the terms of his employment agreement, Mr. Oh is entitled to participate in national health insurance and the national pension plan provided under the laws of Korea, to receive reimbursement for annual physical examinations for him and his spouse, and to make use of a company provided car and driver for business and reasonable personal use.
Similar to the restraint of trade agreements that we have with our other named executive officers, Mr. Oh’s employment agreement provides that upon the termination of his services with us, he is restricted, for a period of 36 months, from soliciting business from certain customers, working for or holding interests in our competitors or participating in a competitive activity within the territories where we do business. The employment agreement also provides for certain payments upon his termination of service by us without just cause, which payments are described below under “Potential Payments Upon Termination or Change-in-Control” on page 25.
Considerations Regarding Tax Deductibility of Compensation.Section 162(m) of the US tax code places a limit of $1 million on the amount of compensation that we may deduct in any one year with respect to our Chief Executive Officer and each of our namedthe three most highly compensated executive officers (otherother than our Chief Executive Officer or Chief Financial Officer, to whom these limits do not currently apply).Officer. Certain qualified performance-based compensation is not subject to this deduction limit. Our stock option awards under the Stock Incentive Plan have been structured with the intention that the compensation the executives will realize when the stock options are exercised will be qualified performance-based compensation not subject to the limitations imposed by Section 162(m). However, toTo maintain flexibility in compensating our named executive officers in a manner designed to promote our various corporate goals, it is not a policy of the Remuneration Committee that all executive compensation must be tax-deductible. For example, the bonuses and non-equity incentive compensation payments made to our named executive officers are not qualified performance-based compensation and may be subject to the tax deduction limitations imposed by Section 162(m). Similarly, the restricted stock granted to our named executive officers, the vesting of which is conditioned upon satisfaction of our performance goals, may be subject to the tax deductibility limitations imposed by Section 162(m) because the Remuneration Committee retained flexibility to adjust the performance goals to reflect extraordinary events. The Remuneration Committee believes that the importance of retaining this flexibility outweighs the benefits of tax deductibility.
Compensation Consultants.Neither we nor the Remuneration Committee have any contractual arrangement with any compensation consultant or used the services of any compensation consultant who has a role in determining or recommending the amount or form of executive officer compensation.
Role of 2010 Compensation
Elements of 2013 Compensation
Base Salary.Salaries for fiscal 20102013 were determined in the first quarter of the 20102013 fiscal year after a review of our peer group companies described above.
18
After adoption of the cash incentive award plan, several significant and unforeseen developments affected us for the remainder of fiscal 2013. First, the costs (including direct employee implementation costs, smart card costs and capital expenditures) of implementing the SASSA contract were significantly higher than anticipated, primarily because the number of beneficiaries whom we were contractually required to be based, amongenroll was continually revised upward by SASSA, from an initial estimate of 15.5 million to approximately 21.7 million, comprising approximately 9.5 million grant recipients and 12.2 million beneficiaries (rather than the earlier estimate of 6 million beneficiaries associated with these recipients). This upward revision, together with an extension of the enrollment deadline for grant recipient cardholders, required us to spend significantly more on implementation than we had anticipated. Our total cash outlay of approximately $105 million was measurably more than we had initially anticipated.
Second, the AllPay tender litigation continued into 2013 (and continues to date), with three separate appeals filed by AllPay during the course of the year (two with the South African Constitutional Court and one with the South African Supreme Court of Appeal). Despite the fact that AllPay has been unsuccessful in its challenges of the SASSA tender award to us, our management has been forced to devote a tremendous amount of time and attention to each phase of the litigation. Third, in late November 2012, we received notice that we were being investigated by the U.S. Department of Justice and the Securities and Exchange Commission for potential violations of the Foreign Corrupt Practices Act. We have been cooperating with the investigation. However, the investigation has been costly, has compromised the ability of management to devote their time to other things, on the following qualitative factors: (i) evaluationmatters relating to our business and implementation ofhas damaged our reputation, which has also negatively affected our ability to execute our strategic plan (ii) assessmentduring the past year.
As a result of our progress in relation to domestic and international business development, and (iii) progress on implementing a new management structure and succession plans.
Conditional Guaranteed and Incremental Bonus for Mr. Oh. Mr. Oh met his conditional guaranteed bonus target and therefore an amount of $186,507 was paid to him for fiscal 2010.
Bonus for Mr. Kotze, bonuses may be paid for performance based on factors external to the ones considered in determining the payment of the cash incentive awards described above. Bonuses are determined by the Remuneration Committee with advice from the management directors (in the case of executives other than Dr. Belamant and Mr. Kotze), based upon the Remuneration Committee’s assessment of the individual’s contributions during the year, compared to, but not limited to, a list of individualized goals previously approved by the executive officers and the Remuneration Committee. The goal of this element of compensation focuses on motivating and challenging the executive to achieve superior, longer term, sustained results.
19
Equity Incentive Awards.In May 2009August 2012, Dr. Belamant, Mr. Kotzé and Mr. Soma were awarded options to purchase 102,000, 54,000 and 50,000 shares of common stock, respectively. These options are exercisable at a price of $8.75 per share, which was the Remuneration Committee decided to grantclosing price of our common stock option awards that otherwise were slated to be granted inon the Nasdaq Stock Market on August 2009 for the fiscal 2010 annual grant cycle. The Remuneration Committee decided to accelerate the timing22, 2012.One-third of the grant in order to restore the important retention incentive that our equity awards are designed to achieve but which had been lost due to the significant decline in our stock price resulting from the global economic crisis. The Remuneration Committee noted that the vast majority of our outstanding stock options had exercise prices significantly above the then current market values of our stock. The Remuneration Committee believed that this deeply underwater status of the outstanding stock options negatively impacted the incentivizing purpose of those options. Because the grant of the anticipated August 2009 awards was accelerated to May 2009, no additional grants were made during fiscal 2010.
Finally, the performance target, has been met for the immediately preceding fiscal year. The first tranche of the awards vested on September 1, 2009.
Security Guards for our Chief Executive OfficerOther.. We provide on-site residential security services for Dr. Belamant consisting of two armed guards. These services are provided based on bona fide business relatedbusiness-related security concerns and are an integral part of our overall risk management program. The Board believes that provision of these security services is a necessary and appropriate business expense because Dr. Belamant’s personal safety and security are of the utmost importance to us and our shareholders.
These security services may be viewed as conveying a personal benefit to Dr. BelamantBelamant. Under Mr. Oh’s employment agreement, he is entitled to reimbursement for mandatory national health insurance, national pension and as a result, must be reported inschool fees and is entitled to the Summary Compensation Table below.
20
For the Year Ended June 30, 2010
The information contained in this report shall not be deemed to be “soliciting material” or “filed” with the SEC or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended, the Exchange Act, except to the extent that Net 1 UEPS Technologies, Inc. specifically incorporates it by reference into a document filed under the Securities Act of 1933, as amended or the Exchange Act.
The Remuneration Committee, which comprises all thethree independent directors, has reviewed and discussed the “Compensation Discussion and Analysis” section of this proxy statement with our Chief Executive Officer, Dr. Serge C.P. Belamant, and our Chief Financial Officer, Herman G. Kotzé. Based on this review and discussion, the Remuneration Committee recommended to our Board of Directors that the “Compensation Discussion and Analysis” section be included in our Annual Report on Form 10-K and this proxy statement.
Remuneration Committee Alasdair J.K. Pein, Chairman Christopher S. Seabrooke Paul Edwards |
Remuneration CommitteeEXECUTIVE COMPENSATION TABLESAlasdair J.K. Pein, ChairmanChristopher Stefan SeabrookeAntony Charles BallPaul EdwardsTom Collier Tinsley
The following narrative, tables and footnotes describe the “total compensation” earned during fiscal years 2010, 20092013, 2012 and 2008,2011, as applicable, by our named executive officers. The total compensation presented below in the Summary Compensation Table does not reflect the actual compensation received by our named executive officers or the target compensation of our named executive officers in fiscal 2010.2013. The actual value realized by our named executive officers in fiscal 20102013 from long-term equity incentives (options and restricted stock) is presented in the Option Exercises and Stock Vested Table on page 25 of this proxy statement.25. Target annual incentive awards for fiscal 20102013 are presented in the Grants of Plan-Based Awards table on page 23 of this proxy statement.
21
The following table sets forth the compensation earned by our Chief Executive Officer, our Chief Financial Officer and our other named executive officerofficers for services rendered during fiscal years 2010, 20092013, 2012 and 2008.
Non-Equity | All Other | |||||||||||||||||||||||||||||||
Stock Awards | Option Awards | Incentive Plan | Compensation | |||||||||||||||||||||||||||||
Name and | Salary ($’000) | ($’000) | ($’000) | Compensation | ($’000) | Total | ||||||||||||||||||||||||||
Principal Position | Year | (2) | Bonus ($’000) (3) | (4) | (5) | ($’000) (3) | (6) | ($’000) | ||||||||||||||||||||||||
Dr. Serge Belamant, Chief Executive Officer, Chairman of the Board and Director | 2010 2009 2008 | 850 850 850 | 255 — — | — — 910 | — 2,258 — | 221 400 850 | 38 32 41 | 1,364 3,540 2,651 | ||||||||||||||||||||||||
Herman Kotzé, Chief Financial Officer, Treasurer, Secretary and Director | 2010 2009 2008 | 425 425 425 | 128 100 — | — — 910 | — 1,245 — | 110 200 319 | — — — | 663 1,970 1,654 | ||||||||||||||||||||||||
Nitin Soma, Vice-President – Information Technology | 2010 2009 2008 | 288 288 288 | 72 72 72 | — — 689 | — 723 — | — — — | — — — | 360 1,083 1,049 |
Name and Principal Position | Year | Salary ($) (2) | Bonus ($) (3) | Stock Awards ($) | Option Awards ($) (4) | Non-Equity Incentive Plan Compensation ($) (3) | All Other Compensation ($) | Total ($) | ||||||||||||||||||||||||
Dr. Serge C.P. Belamant, |
| 2013 2012 2011 |
|
| 892,500 892,500 850,000 |
|
| 812,175 2,000,000 — |
|
| — 3,055,250 529,500 | (6) (8) |
| 295,656 245,012 260,800 |
|
| — 661,938 229,102 | (7)
|
| 32,548 36,731 40,541 | (5) (5) (5) | | 2,032,879 6,891,431 1,909,943 | | ||||||||
Herman G. Kotzé, | | 2013 2012 2011 | | | 472,500 472,500 445,833 | | | 429,975 1,200,000 — | |
| — 1,833,150 349,470 | (6) (8) | | 156,524 131,256 174,736 | |
| — 350,437 121,289 | (7)
|
| — — — |
| | 1,058,999 3,987,343 1,091,328 | | ||||||||
Phil-Hyun Oh, | | 2013 2012 2011 | (9) | | 349,701 340,418 223,071 | |
| — — — |
| | — — | |
| — — — |
| | 186,507 181,121 — | |
| 63,062 64,778 38,552 | (10) (10) (10) | | 599,270 586,317 1,001,423 | | ||||||||
Nitin Soma, | | 2013 2012 2011 | | | 288,000 288,000 288,000 | | | 72,000 472,000 72,000 | |
| — 611,050 — | (6)
| | 144,930 62,909 91,280 | |
| — — — |
|
| — — — |
| | 504,930 1,433,959 451,280 | |
(1) | Includes only those columns relating to compensation awarded to, earned by, or paid to the named executive officers in any of fiscal | |
(2) | The applicable amount for | |
(3) | Bonus and non-equity incentive plan compensation represent amounts earned for the fiscal years ended June 30, and | |
(4) | Represents FASB ASC Topic 718 grant date fair value of stock options granted under our Stock Incentive Plan. See note 17 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended June 30, 2013, for the relevant assumptions used in calculating grant date fair value under FASB ASC Topic 718. |
(5) | Represents costs for security guards for Dr. Belamant, which are paid in ZAR. |
(6) | Represents FASB ASC Topic 718 grant date fair value of shares of restricted stock awarded in February 2012 related to |
(7) | On November 7, 2012, the Remuneration Committee determined to pay Dr. Belamant and Mr. Kotzé $223,125 and $118,125, respectively, in respect of the 2012 cash incentive award plan. The qualitative portion of the 2012 cash incentive award plan provided, in part, for payments based on submission by management, and Board approval, of a new strategic plan by August 2012. Although management submitted the new strategic plan, the Board had not completed its evaluation prior to the end of August 2012. As a result, and as disclosed in our proxy statement for the 2012 annual meeting of shareholders, the Remuneration Committee determined in August 2012 to award Dr. Belamant and Mr. Kotzé only 50% of the qualitative portion of the 2012 cash incentive plan. On November 7, 2012, the Board approved the new strategic plan substantially in the form presented by management and thus, the Remuneration Committee determined to make the payments described above which represent the remaining 50% of the qualitative portion of the 2012 cash incentive award plan. |
(8) | Represents FASB ASC Topic 718 grant date fair value of shares of restricted stock awarded in November 2010, one-third of |
(9) | Mr. Oh joined us on October 29, 2010, in connection with the acquisition of KSNET and is paid in Korean won. The amounts presented in this row have been translated to US dollars using the average exchange rate for the eight months to June 30, 2011. |
Represents payments made by us for Mr. Oh’s Korea mandatory employee national health insurance, national pension, school fees and automobile expenses, which are paid in KRW. |
(11) | Represents FASB ASC Topic 718 grant date fair value of shares of restricted stock | |
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The following table provides information concerning non-equity and equity incentive plan awards granted during fiscal 20102013 to each of our named executive officers. We did not grant any equity-based awards during fiscal 2010.
Estimated Possible Payouts Under | ||||||||||||||||
Non-Equity Incentive | ||||||||||||||||
Plan Awards (2) | ||||||||||||||||
Threshold | Target | Maximum | ||||||||||||||
Name | Type of Award | ($’000) | ($’000) | ($’000) | ||||||||||||
Dr. Serge Belamant | AC | 238,000 | 850,000 | 1,190,000 | ||||||||||||
Herman Kotzé | AC | 119,000 | 425,000 | 595,000 |
Estimated Future Payouts Under Non-Equity Incentive Plan Awards (2) | All Other Stock Awards: Number of Shares of Stock or Units | All Other Option Awards: Number of Securities Underlying Options | Exercise or Base Price of Option Awards | Grant Date Fair Value of Stock and Option Awards | ||||||||||||||||||||||||||||||||
Name | Grant Date | Date of Committee Action | Type of Award | Threshold ($) | Target ($) | Maximum ($) | (#) | (#) | ($/Sh) | ($) | ||||||||||||||||||||||||||
Dr. Serge C.P. Belamant | — | AC | 24,990 | 892,500 | 1,517,250 | |||||||||||||||||||||||||||||||
08/22/12 | 08/22/12 | SO | 102,000 | $ | 8.75 | 295,656 | ||||||||||||||||||||||||||||||
Herman G. Kotzé | — | AC | 13,230 | 472,500 | 637,875 | |||||||||||||||||||||||||||||||
08/22/12 | 08/22/12 | SO | 54,000 | $ | 8.75 | 156,524 | ||||||||||||||||||||||||||||||
Phil-Hyun Oh | 10/29/10 | 09/14/10 | AC | 186,507 | 349,701 | 437,127 | ||||||||||||||||||||||||||||||
Nitin Soma | 08/22/12 | 08/22/12 | SO | 50,000 | $ | 8.75 | 144,930 |
Key: | AC (annual cash incentive award); SO (stock option) | |
(1) | Includes only those columns relating to grants awarded to the named executive officers in fiscal | |
(2) |
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The following table shows all outstanding equity awards held by our named executive officers at the end of fiscal 2010.2013. The market value of unvested shares reflected in this table is calculated by multiplying the number of unvested shares by the per share closing price of $13.41$7.36 of our common stock on June 30, 2010,2013, the last trading day of the fiscal year.
Option Awards | Stock Awards | |||||||||||||||||||||||
Number of | Equity | |||||||||||||||||||||||
Number of | Securities | Incentive | ||||||||||||||||||||||
Securities | Under- | Equity Incentive | Plan Awards: Market | |||||||||||||||||||||
Underlying | lying | Plan Awards: Number | or Payout Value of | |||||||||||||||||||||
Unexer- | Unexer- | of Unearned Shares, | Unearned Shares, | |||||||||||||||||||||
cised | cised | Option | Units or Other | Units or Other | ||||||||||||||||||||
Options | Options | Exercise | Option | Rights That Have | Rights That Have | |||||||||||||||||||
(#) | (#) | Price | Expiration | Not Vested | Not Vested | |||||||||||||||||||
Name | Exercisable | Unexercisable | ($) | Date | (number of shares) | ($’ 000) | ||||||||||||||||||
Dr. Serge Belamant | 64,000 | 16,000 | (2) | $ | 22.51 | 8/24/2016 | 26,666 | (5) | 358 | (6) | ||||||||||||||
80,000 | 120,000 | (3) | $ | 24.46 | 8/24/2018 | |||||||||||||||||||
26,000 | 104,000 | (4) | $ | 13.16 | 5/20/2019 | |||||||||||||||||||
Herman Kotzé | 28,000 | 7,000 | (2) | $ | 22.51 | 8/24/2016 | 26,666 | (5) | 358 | (6) | ||||||||||||||
40,000 | 60,000 | (3) | $ | 24.46 | 8/24/2018 | |||||||||||||||||||
22,000 | 88,000 | (4) | $ | 13.16 | 5/20/2019 | |||||||||||||||||||
Nitin Soma | 16,000 | 4,000 | (2) | $ | 22.51 | 8/24/2016 | 20,000 | (5) | 268 | (6) | ||||||||||||||
24,000 | 36,000 | (3) | $ | 24.46 | 8/24/2018 | |||||||||||||||||||
12,000 | 48,000 | (4) | $ | 13.16 | 5/20/2019 |
Option Awards | Stock Awards | |||||||||||||||||||||||||||||
Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | ||||||||||||||||||||||
Dr. Serge C.P. Belamant | 80,000 | — | $ | 22.51 | 8/24/2016 | 216,666 | (6) | 1,594,662 | ||||||||||||||||||||||
200,000 | — | $ | 24.46 | 8/24/2018 | ||||||||||||||||||||||||||
104,000 | 26,000 | (2) | $ | 13.16 | 5/20/2019 | |||||||||||||||||||||||||
66,667 | 33,333 | (3) | $ | 10.59 | 11/10/2020 | |||||||||||||||||||||||||
37,333 | 74,667 | (4) | $ | 7.98 | 10/28/2021 | |||||||||||||||||||||||||
— | 102,000 | (5) | $ | 8.75 | 08/22/2022 | |||||||||||||||||||||||||
Herman G. Kotzé | 35,000 | — | $ | 22.51 | 8/24/2016 | 132,000 | (7) | 971,520 | ||||||||||||||||||||||
100,000 | — | $ | 24.46 | 8/24/2018 | ||||||||||||||||||||||||||
88,000 | 22,000 | (2) | $ | 13.16 | 5/20/2019 | |||||||||||||||||||||||||
44,667 | 22,333 | (3) | $ | 10.59 | 11/10/2020 | |||||||||||||||||||||||||
20,000 | 40,000 | (4) | $ | 7.98 | 10/28/2021 | |||||||||||||||||||||||||
— | 54,000 | (5) | $ | 8.75 | 08/22/2022 | |||||||||||||||||||||||||
Phil-Hyun Oh | — | — | — | |||||||||||||||||||||||||||
Nitin Soma | 20,000 | — | $ | 22.51 | 8/24/2016 | 36,667 | (8) | 269,869 | ||||||||||||||||||||||
60,000 | — | $ | 24.46 | 8/24/2018 | ||||||||||||||||||||||||||
48,000 | 12,000 | (2) | $ | 13.16 | 5/20/2019 | |||||||||||||||||||||||||
23,333 | 11,667 | (3) | $ | 10.59 | 11/10/2020 | |||||||||||||||||||||||||
11,667 | 23,333 | (9) | $ | 6.59 | 08/26/2021 | |||||||||||||||||||||||||
— | 50,000 | (5) | $ | 8.75 | 08/22/2022 |
(1) | Includes only those columns that are relevant to the types of awards that remained outstanding as of the end of fiscal | |
(2) | These options vest on May 8, | |
(3) | These options vest on November 10, 2013. |
(4) | ||
(5) | Represents |
(6) | Represents (i) 33,333 shares of restricted stock |
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(8) | Represents 36,667 shares of restricted stock awarded in February 2012, one-half of which are scheduled to vest on each of February 6, 2014 and 2015, with vesting conditioned upon continuous service through the applicable vesting date. |
(9) | One-third of these options vest on each of August 26, 2013 and 2014, respectively. |
There were no stock options exercised by our named executive officers during fiscal 2010.2013. The following table shows all stock awards that vested during fiscal 2010.
Stock Awards | ||||||||||||
Number of shares | Value Realized | |||||||||||
Name | acquired on vesting (#) | on Vesting ($’000)(2) | ||||||||||
Dr. Serge Belamant | 13,334 | 254 | ||||||||||
Herman Kotzé | 13,334 | 254 | ||||||||||
Nitin Soma | 10,000 | 190 |
Stock Awards | ||||||||
Name | Number of shares acquired on vesting (#) | Value Realized on Vesting ($)(2) | ||||||
Dr. Serge C.P. Belamant | 91,667 | 547,252 | ||||||
Herman G. Kotzé | 55,000 | 328,350 | ||||||
Phil-Hyun Oh | — | — | ||||||
Nitin Soma | 18,333 | 109,448 |
(1) | Includes only those columns relating to stock awards held by our named executive officers that vested in fiscal | |
(2) | The value realized on vesting is calculated as the closing price of our common stock on the vesting date multiplied by the number of common shares of restricted stock that vested. |
As described above under “Compensation Discussion and Analysis”, we do not have employment, severance or change of control agreements with named executive officers. Accordingly,officers, other than the employment agreement with Mr. Oh. In addition, none of our outstanding equity awards include provisions for accelerated vesting upon a change in control of our company or termination of employment following such a change in control.
Under the terms of Mr. Oh’s employment agreement, if he is removed from office as a director of KSNET without justifiable cause, he is entitled to receive the amounts of base salary and the bonus (if any) that would have been due and payable to him if he was fully employed with us for the remainder of the then-current fiscal year. The term “justifiable cause” includes any of the following circumstances, as well as any other circumstances permitted under applicable law:
Mr. Oh has breached the provisions on non-competition or confidentiality of the employment agreement;
Mr. Oh has taken actions that are likely to result in a material loss of or harm to the business, reputation or goodwill of KSNET;
Mr. Oh has misappropriated funds or assets of KSNET;
Mr. Oh has concealed from or falsely disclosed to KSNET his name, age, education, experience, or other personal information;
Mr. Oh has failed to show performance results or job capacity;
Mr. Oh has committed a crime or offense which will adversely affect the interest or reputation of KSNET; or
Mr. Oh has committed gross negligence, willful misconduct or any violation of laws in performance of his duties.
Assuming that Mr. Oh was removed from office as a director of KSNET without justifiable cause on the last day of fiscal 2013, i.e., June 30, 2013, Mr. Oh would not have been entitled to receive any cash severance because he would have already received all amounts of base salary and bonus for the fiscal year.
Mr. Oh is also entitled to a severance payment equal to 300% of his monthly base salary for each completed year of service at KSNET. Using exchange rates applicable as of June 30, 2013, and six years of completed service, Mr. Oh would be entitled to a severance payment of $524,552.
Except as described above with respect to Mr. Oh, there would be no compensation, other than that prescribed by local labor laws in the case of unfair dismissal or retrenchment, that would become payable under the existing plans and arrangements if the employment of any of our named executive officers had terminated on June 30, 2010.
We do not have any ongoing obligation to provide post-termination benefits to our named executive officers after termination of employment.
Review, Approval or Ratification of Related Person Transactions
We review all relationships and transactions in which we and our directors and named executive officers or their immediate family members are participants to determine whether such persons have a direct or indirect material interest. Our Chief Executive Officer and Chief Financial Officer are primarily responsible for the development and implementation of processes and controls to obtain information from the directors and named executive officers with respect to related person transactions and for then determining, based on the facts and circumstances, whether we or a related person has a direct or indirect material interest in the transaction. As required under SEC rules, transactions that are determined to be directly or indirectly material to us or a related person are disclosed in our proxy statement. In addition, our Audit Committee reviews and approves or ratifies any related person transaction that is required to be disclosed. In the course of its review and approval or ratification of a disclosable related party transaction, our Audit Committee considers:
the nature of the related person’s interest in the transaction;
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the material terms of the transaction, including, without limitation, the amount and type of transaction;
the importance of the transaction to us;
whether the transaction would impair the judgment of a director or executive officer to act in our best interest; and
any other matters the committee deems appropriate.
Any member of the Audit Committee who is a related person with respect to a transaction under review may not participate in the deliberations or vote respecting approval or ratification of the transaction, provided, however, that such director may be counted in determining the presence of a quorum at a meeting of the committee that considers the transaction.
Related Party Transactions
Pursuant to the stock purchaserelationship agreement, dated July 18, 2005,January 25, 2012, among the investment entities affiliated with GA,Business Venture Investments No 1567 (Proprietary) Limited (RF) (“BVI”), Mosomo Investment Holdings (Proprietary) Limited, Mr. Mosehla and us, and certain other parties, GAwe granted BVI an option to acquire 8,955,000 shares of our common stock at an exercise price of $8.96 per share. The option expired unexercised on April 19, 2013.
BVI is also entitled to designate one nominee to our Board. This designee is currently Mr. Tinsley. In addition, pursuant to the stock purchase agreement, we granted rights, under certain circumstances and subject to certain limitations, with respect to the registrationBoard provided it holds more than 10% of our outstanding common stock. The right to have the BVI nominee serve on the Board shall cease at such time as BVI, together with its affiliates, owns less than 10% of our outstanding common stock or upon the occurrence of a trigger event as defined in the relationship agreement. Mr. Mosehla currently serves on our Board by invitation.
On September 14, 2012, we acquired all of the outstanding and issued ordinary shares heldin Pbel. Prior to our acquisition of Pbel described below, Pbel was jointly owned by investment entities affiliated with GA.
The following table shows the fees that we paid or accrued for the audit and other services provided by Deloitte for the fiscal years ended June 30, 20102013 and 2009.
2010 | 2009 | |||||||
$ ‘000 | $ ‘000 | |||||||
Audit Fees | 1,813 | 1,352 | ||||||
Audit-Related Fees | — | — | ||||||
Tax Fees | — | — | ||||||
All Other Fees | — | — |
2013 $ ‘000 | 2012 $ ‘000 | |||||||
Audit Fees | 1,720 | 2,078 | ||||||
Audit-Related Fees | — | — | ||||||
Tax Fees | — | — | ||||||
Other Fees: Responding to SEC Inquiry | 113 | — | ||||||
All Other Fees | — | — |
Audit Fees — Fees—This category includes the audit of our annual consolidated financial statements, review of financial statements included in our quarterly reports on Form 10-Q, the required audit of management’s assessment of the effectiveness of our internal control over financial reporting and the auditors’ independent audit of internal control over financial reporting, and the services that an independent auditor would customarily provide in connection with subsidiary audits, statutory requirements, regulatory filings, and similar engagements for the fiscal year, such as comfort letters, attest services, consents, and assistance with review of documents filed with the SEC. This category also includes advice on audit and accounting matters that arose during, or as a result of, the audit or the review of interim financial statements.
Audit-Related Fees — Fees—This category consists of assurance and related services by the independent registered public accounting firm that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under “Audit Fees.” There were no such fees paid in the fiscal years ended June 30, 20102013 or 2009.
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Other Fees: Responding to SEC Inquiry—This category consists of services, including costs, incurred by Deloitte that arose during, or as a result of, the investigation by the DOJ/SEC. The services for the fees disclosed under this category include responding to document production requests, and preparation for presentations made by Deloitte directly to the SEC. There were no such fees paid in the fiscal year ended June 30, 2012.
All Other Fees — Fees—There were no such fees paid in the fiscal years ended June 30, 20102013 or 2009.
Pre-Approval of Non-Audit Services
Pursuant to our Audit Committee charter, our Audit Committee reviews and pre-approves both audit and non-audit services to be provided by our independent auditors. The authority to grant pre-approvals of non-audit services may be delegated to one or more designated members of the Audit Committee whose decisions will be presented to the full Audit Committee at its next regularly scheduled meeting. During fiscal years 20102013 and 2009,2012, all of services provided by Deloitte with respect to fiscal years 20102013 and 20092012 were pre-approved by the Board and the Audit Committee.
The Audit Committee of the Board consists of three independent directors, as required by Nasdaq listing standards. The Audit Committee operates under a written charter adopted by the Board and available on our website atwww.net1.com under the “Investor Relations — Relations—Governance” section. The Audit Committee is responsible for overseeing our financial reporting process on behalf of the Board. The members of the Audit Committee are Messrs. Seabrooke, Pein and Edwards. The Audit Committee selects, subject to shareholder ratification, our independent registered public accounting firm.
Management is responsible for our financial statements and the financial reporting process, including internal controls. The independent registered public accounting firm is responsible for performing an independent audit of our consolidated financial statements in accordance with auditing standards generally accepted in the United States and of our internal control over financial reporting and for issuing a report thereon. The Audit Committee’s responsibility is to monitor and oversee these processes.
In this context, the Audit Committee has met and held discussions with management and Deloitte. Our Chief Executive Officer and Chief Financial Officer represented to the Audit Committee that the consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States, and the committee reviewed and discussed the consolidated financial statements with our Chief Executive Officer and Chief Financial Officer and Deloitte. The Audit Committee discussed with Deloitte the matters required to be discussed by the statement on Auditing Standards No. 61, as amended (AICPA, Professional Standards, Vol. 1. AU §380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T. These matters included a discussion of Deloitte’s judgments about the quality (not just the acceptability) of our accounting principles as applied to our financial reporting.
Deloitte also provided the Audit Committee with the written disclosures and letter required by applicable requirements of the PCAOB regarding Deloitte’s communications with the Audit Committee concerning independence, and the Audit Committee discussed with Deloitte the firm’s independence. The Audit Committee further considered whether the provision by Deloitte of the non-audit services described above is compatible with maintaining the auditors’ independence.
Based upon the Audit Committee’s discussion with management and Deloitte and the Audit Committee’s review of the representations of management and the disclosures by Deloitte to the Audit Committee, the Audit Committee recommended to the Board that our audited consolidated financial statements be included in our Annual Report on Form 10-K for the year ended June 30, 2010,2013, for filing with the SEC.
Audit Committee Christopher S. Seabrooke, Chairman | ||
Alasdair J.K. Pein | ||
Paul Edwards |
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The following table presents, as of October 15, 2010,4, 2013, information about beneficial ownership of our common stock by:
each person or group of affiliated persons who or which, to our knowledge, owns beneficially more than 5% of our outstanding shares of common stock;
each of our directors and named executive officers; and
all of our directors and executive officers as a group.
Beneficial ownership of shares is determined in accordance with SEC rules and generally includes any shares over which a person exercises sole or shared voting or investment power. The beneficial ownership percentages set forth below are based on 45,392,35345,780,513 shares of common stock outstanding as of October 15, 2010.4, 2013. All shares of common stock, including that common stock underlying stock options that are presently exercisable or exercisable within 60 days after October 15, 20104, 2013 (which we refer to as being currently exercisable) by each person are deemed to be outstanding and beneficially owned by that person for the purpose of computing the ownership percentage of that person, but are not considered outstanding for the purpose of computing the percentage ownership of any other person.
Except as otherwise noted, each shareholder’s address is c/o Net 1 UEPS Technologies, Inc., President Place, 4th Floor, Corner of Jan Smuts Avenue and Bolton Road, Rosebank, Johannesburg, South Africa.
Shares of Common | ||||||||
Stock Beneficially Owned | ||||||||
Name | Number | % | ||||||
Antony C. Ball(1) | 3,388 | * | ||||||
Dr. Serge C.P Belamant(2) | 1,073,288 | 2.36 | % | |||||
Paul Edwards(3) | 6,870 | * | ||||||
Herman G. Kotzé(4) | 116,666 | * | ||||||
Alasdair J.K. Pein(5) | 106,089 | * | ||||||
Chris S. Seabrooke(6) | 10,105 | * | ||||||
Nitin Soma(7) | 72,000 | * | ||||||
Tom C. Tinsley(8) (10) | 6,412,479 | 14.13 | % | |||||
International Value Advisers, LLC (9) | 3,636,420 | 8.01 | % | |||||
Investment entities affiliated with General Atlantic LLC(10) | 6,409,091 | 14.12 | % | |||||
Directors and Executive Officers as a group (11) | 7,800,885 | 17.07 | % |
Name | Shares of Common Stock Beneficially Owned | |||||||
Number | % | |||||||
Dr. Serge C.P. Belamant(1) | 1,831,327 | 3.95 | % | |||||
Paul Edwards(2) | 14,235 | * | ||||||
Herman G. Kotzé(3) | 559,333 | 1.21 | % | |||||
Brian K. Mosehla(4) | 8,886 | * | ||||||
Phil-Hyun Oh (5) | 13,333 | * | ||||||
Alasdair J.K. Pein(6) | 125,387 | * | ||||||
Christopher S. Seabrooke(7) | 235,139 | * | ||||||
Nitin Soma(8) | 268,001 | * | ||||||
International Value Advisers, LLC(9) | 12,626,159 | 27.58 | % | |||||
Investment entities affiliated with General Atlantic LLC(10) | 6,409,091 | 14.00 | % | |||||
Allan Gray Proprietary Limited (11) | 6,234,316 | 13.62 | % | |||||
Directors and Executive Officers as a group(12) | 3,055,641 | 6.48 | % |
* | Less than one percent |
(1) | Includes | |
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(2) | Comprises 4,841 shares of unrestricted stock and |
(4) | Comprises 1,715 shares of unrestricted stock and 7,171 shares of restricted stock which vest over time and are subject to forfeiture. Vesting of the restricted stock is conditioned on Mr. Mosehla’s continued service as a |
(5) | Comprises 13,333 shares of restricted stock which vest over time and are subject to forfeiture. Vesting of the restricted stock is conditioned on Mr. Oh’s continued service as our employee on the applicable vesting date. |
(6) | Includes 25,263 shares owned by Mr. Pein, which comprise 12,649 shares of unrestricted stock and | |
(7) | Includes 23,255 shares owned | |
(8) | Comprises (i) 28,333 shares of | |
(9) | Based solely on a Form | |
(10) |
(11) | Except as set forth in the last sentence of this footnote, the number of shares presented and all of the information contained in this footnote is based solely on Amendment No. 1 to Schedule 13G, dated April 18, 2013, filed by Allan Gray Proprietary Limited (“Allan Gray”), a corporation organized under the laws of the Republic of South Africa. The |
(12) | Represents shares beneficially owned by the directors and executive officers listed in the table. Includes shares issuable upon exercise of options to purchase |
29
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires that our executive officers and directors, and persons who own more than 10% of a registered class of our equity securities, file reports of ownership and changes in ownership with the SEC and provide us with copies of such reports. We have reviewed such reports received by us and written representations from our directors and executive officers. Based solely on such review and representations, we believe that all filings requirements applicable to our executive officers, directors and more than 10% shareholders were complied with during fiscal year 2010.
Annual Report on Form 10-K
A copy of our annual report on Form10-K (without exhibits) for the fiscal year ended June 30, 20102013, is being distributed along with this proxy statement. We refer you to such report for financial and other information about us, but such report is not incorporated in this proxy statement and is not deemed to be a part of the proxy solicitation material. It is also available on our website (www.net1.com)(www.net1.com). In addition, the annual report (with exhibits) is available at the SEC’s website (www.sec.gov)(www.sec.gov).
Shareholder Proposals for the 20112014 Annual Meeting
Qualified shareholders who wish to have proposals presented at the 20112014 annual meeting of shareholders must deliver them to us by June 30, 2011,19, 2014, in order to be considered for inclusion in next year’s proxy statement and proxy pursuant to Rule 14a-8 under the Exchange Act. Shareholders who intend to present an item of business for our 20112014 annual meeting of shareholders (other than a proposal presented for inclusion in next year’s proxy statement and proxy pursuant to Rule 14a-8) must provide notice of such business to us by June 30, 2011,19, 2014, as set forth more fully in Sections 2.08 and 4.16 of our Amended and Restated By-Laws. All proposals and nominations must be delivered to us at our principal executive offices at P O Box 2424, Parklands 2121, Gauteng, South Africa.
Householding of Proxy Materials
We have adopted a procedure approved by the SEC called “householding.” Under this procedure, multiple shareholders who share the same last name and address will receive only one copy of the annual proxy materials, unless they notify us that they wish to continue receiving multiple copies. We have undertaken householding to reduce our printing costs and postage fees.
If you wish to opt-out of householding and receive multiple copies of the proxy materials at the same address, you may do so at any time prior to 30 days before the mailing of proxy materials, which typically are mailed at the end of October of each year, by notifying us in writing at: Net 1 UEPS Technologies, Inc., POP O Box 2424, Parklands 2121, Gauteng, South Africa, Attention: Corporate Secretary. You also may request additional copies of the proxy materials by notifying us in writing at the same address.
If you share an address with another shareholder and currently are receiving multiple copies of the proxy materials, you may request householding by notifying us at the above-referenced address.
Other Matters
The Board knows of no other matters that will be presented for consideration at the annual meeting. Return of a valid proxy, however, confers on the designated proxy holders the discretionary authority to vote the shares in accordance with their best judgment on such other business, if any, that may properly come before the meeting or any adjournment or postponement thereof.
By Order of the Board of Directors, | ||||
Dr. Serge C. P. Belamant | ||||
Chairman and Chief Executive Officer | ||||
October 28, 2010
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31
IMPORTANT ANNUAL MEETING INFORMATION | ||||||
Using ablack inkpen, mark your votes with anXas shown in this example. Please do not write outside the designated areas. | x |
PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
A | Proposals — The Board of Directors recommends a voteFOR all the nominees listed andFOR Proposals 2 and 3. |
1. | ELECTION OF DIRECTORS. Nominees: | + | ||||||||||||||||||||||||||||||
For | Withhold | For | Withhold | For | Withhold | |||||||||||||||||||||||||||
01 - Dr. Serge C.P. Belamant | |||||||||||||||
¨ | ¨ | 02 - Herman G. Kotze | ¨ | ||||||||||||
¨ | 03 - Christopher S. Seabrooke | ¨ | ¨ | ||||||||||||
¨ | 05 - Paul Edwards | ¨ | ¨ | ||||||||||||
¨ | ¨ |
For | Against | Abstain | For | Against | Abstain | |||||||||||||
2. | RATIFICATION OF THE SELECTION OF DELOITTE & TOUCHE (SOUTH AFRICA) AS THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE COMPANY FOR THE FISCAL YEAR ENDING JUNE 30, 2014. | ¨ | ¨ | ¨ | 3. | ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION. | ¨ | ¨ | ¨ | |||||||||
4. | In their discretion to transact such other business and act upon any other matter which may properly come before the meeting or any adjournment or postponement of the meeting. |
B | Non-Voting Items |
Change of Address — Please print new address below. | Comments — Please print your comments below. | |||
C | ||||||||
Sign Below |
Please sign exactly as your name appears on yourstock certificates. When joint tenants hold shares, both should sign. When signing as attorney, executor, administrator, trustee, guardian, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized officer. If a partnership, please sign in partnership name by authorized person.
Date (mm/dd/yyyy) — Please print date below. | Signature 1 — Please keep signature within the box. | Signature 2 — Please keep signature within the box. |
/ / | |||||||||||||
¢ | + |
PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
Proxy — Net 1 UEPS Technologies, Inc. account online.
▼ FOLD AND DETACH HERE ▼
This proxy is solicited on behalf of the Board of Directors of Net 1 UEPS Technologies, Inc. for the Annual Meeting of Shareholders to be held on November 29, 2010.19, 2013. The undersigned appoints Dr. Serge C.P. Belamant and Herman G. Kotze, and each of them, with full power of substitution in each, the proxies of the undersigned, to represent the undersigned and vote all shares of the common stock of Net 1 UEPS Technologies, Inc. which the undersigned may be entitled to vote at the Annual Meeting, of Shareholders to be held on November 29, 2010, and at any adjournment or postponement thereof, as indicated on the reverse side of this proxy.
This proxy, when properly executed, will be voted in the manner directed herein by the undersigned shareholder. If no direction is given, then this proxy will be voted FOR ALL nominees for director and FOR proposal 2.
THE BOARD HOPES THAT YOU WILL ATTEND THE MEETING. WHETHER OR NOT YOU PLAN TO ATTEND, PLEASE PROMPTLY COMPLETE, DATE, SIGN AND RETURN THE PROXY IN THE ENCLOSED ENVELOPE OR MAIL TO:
PROXY SERVICES
c/o Computershare
PO Box 43126
Providence, RI 02940-5138
(Please Sign on Reverse Side)
IMPORTANT ANNUAL MEETING INFORMATION | ||||||
Using ablack inkpen, mark your votes with anXas shown in this example. Please do not write outside the designated areas. | x |
A | Proposals — The Board of Directors recommends a voteFOR all the nominees listed andFOR Proposals 2 and 3. |
1. | ELECTION OF DIRECTORS. Nominees: | |||||||||||||||||||||||||||||||
For | Withhold | For | Withhold | For | Withhold | |||||||||||||||||||||||||||
01 - Dr. Serge C.P. Belamant | ¨ | ¨ | 02 - Herman G. Kotze | ¨ | ¨ | 03 - Christopher S. Seabrooke | ¨ | ¨ | ||||||||||||||||||||||||
04 - Alasdair J.K. Pein | ¨ | ¨ | 05 - Paul Edwards | ¨ | ¨ | 06 - Brian K. Mosehla | ¨ | ¨ |
For | Against | Abstain | For | Against | Abstain | |||||||||||||
2. | RATIFICATION OF THE SELECTION OF DELOITTE & TOUCHE (SOUTH AFRICA) AS THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE COMPANY FOR THE FISCAL YEAR ENDING JUNE 30, 2014. | ¨ | ¨ | ¨ | 3. | ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION. | ¨ | ¨ | ¨ | |||||||||
4. | In their discretion to transact such other business and act upon any other matter which may properly come before the meeting or any adjournment or postponement of the meeting. |
B | Non-Voting Items |
Change of Address— Please print new address below. | Comments— Please print your comments below. | |||
C | Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below |
Please sign exactly as your name appears on your stock certificates. When joint tenants hold shares, both should sign. When signing as attorney, executor, administrator, trustee, guardian, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized officer. If a partnership, please sign in partnership name by authorized person.
Date (mm/dd/yyyy) — Please print date below. | Signature 1 — Please keep signature within the box. | Signature 2 — Please keep signature within the box. |
Net 1 UEPS Technologies, Inc. Proxy for Shareholders Registered on South African Branch Register
THIS SOUTH AFRICAN PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
This South African proxy is solicited on behalf of the Board of Directors of Net 1 UEPS Technologies, Inc. for the Annual Meeting of Shareholders to be held on November 19, 2013. The undersigned appoints Dr. Serge C.P. Belamant and Herman G. Kotze, and each of them, with full power of substitution in each, the proxies of the undersigned, to represent the undersigned and vote all shares of the common stock of Net 1 UEPS Technologies, Inc. which the undersigned may be entitled to vote at the Annual Meeting, and at any adjournment or postponement thereof, as indicated on the reverse side of this South African proxy.
This South African proxy, when properly executed, will be voted in the manner directed herein by the undersigned shareholder. If no direction is given, then this South African proxy will be voted FOR ALL nominees for director and FOR proposals 2 and 3.
This South African proxy must be lodged, posted or faxed to Link Market Services South Africa (Proprietary) Limited so as to reach them by 16:00 on November 15, 2013. South African shareholders that have already dematerialized their shares through a CSDP or broker, other than with own-name registration, should not complete this South African proxy. Instead they should provide their CSDP or broker with their voting instructions. South African shareholders that have already dematerialized their shares through a CSDP or broker, other than with own-name registration, should not complete this South African proxy. Instead they should provide their CSDP or broker with their voting instructions, or alternatively, they should inform their CSDP or broker of their intention to attend the Annual Meeting in order for their CSDP or broker to be able to issue them with the necessary authorization to enable them to attend such meeting. South African shareholders that hold their shares in certificated form or dematerialized own-name registration should complete the South African proxy and return it to Link Market.
THE BOARD HOPES THAT YOU WILL ATTEND THE MEETING. WHETHER OR NOT YOU PLAN TO ATTEND, PLEASE PROMPTLY COMPLETE, DATE, SIGN AND RETURN THIS SOUTH AFRICAN PROXY TO:
LINK MARKET SERVICES SOUTH AFRICA (PTY LTD
Physical address: 13th floor, Rennie House, 19 Ameshoff Street, corner Biccard, Braamfontein
Postal address: PO Box 4844 Johannesburg 2000
Fax: +27 (0) 86 674 2450
(Please Sign on Reverse Side)