The performance-based contract can't go to THAT far. It only works when the player is quite confident that his performance do help the club to achieve better results. If the player does not have confidence on the manager/club (which is obviously our case) and the club is going to be mediocore (probably due to not enough investment by the owner), he will simply walk away to find another clubs.
I would say 40k ppw + 500k performance bonus for European qualification is a lot fair for Barton.