Exhibit 10.4

exhibit1042017executi_image1.gif [exhibit1042017executi_image1.gif]
 
2017 Executive Bonus Plan

This plan document outlines the Blucora Executive Bonus Plan (the “Plan”) for
calendar year 2017. To the extent any provision of this Plan conflicts with any
provision of an Executive’s employment agreement, then such employment agreement
will control.

PLAN OBJECTIVES
•
Provide variable pay opportunities and targeted total cash compensation that are
(a) aligned with key financial drivers, and (b) otherwise consistent with the
total cash compensation philosophy outlined from time to time by the
Compensation Committee of the Compensation Committee of Blucora’s Board of
Directors (“Compensation Committee”).

•
Increase the competitiveness of executive pay without increasing fixed costs,
making bonus payments contingent upon organizational and individual success.

•
Create internal consistency and standard guidelines among the executive peer
group.

EFFECTIVE PERIOD
The Plan is effective for calendar year 2017 and may be changed at any time at
the sole discretion of the Compensation Committee.

PARTICIPATION ELIGIBILITY, BONUS TARGETS AND PAYOUT TIMING
The positions eligible for participation in the Plan are listed in the table
below. Each participant’s annual bonus target, which is stated as a percentage
of annual base salary, is also set forth in the table below. If the executive
leadership team changes, any additions to the Plan will be recommended by the
CEO and approved by the Compensation Committee. Payment of bonuses awarded under
this Plan will be made annually, following the conclusion of the calendar year.

Job Title
Target Bonus %
President and Chief Executive Officer
200%
Chief Financial Officer and Treasurer
60%
Chief Legal and Administrative Officer
60%
Chief Human Resources Officer
50%
Chief Marketing Officer
40%
President, TaxAct*
60%
Chief Executive Officer, HD Vest*
100%

* Executive’s bonus for 2017 will be pro-rated to reflect the number of days of
his employment in 2017 and will be no lower than the pro-rated amount of the
Target Bonus.

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PLAN DESIGN
The Plan includes financial performance that differ among plan participants as
noted in the table below.

 
Target Weighting
Target Category
CEO
CFO
CLO
CMO
CHRO
CEO - HD
CEO - TA
Consolidated Revenue
50%
50%
50%
30%
50%
 
 
Consolidated Adj EBITDA
50%
50%
50%
30%
50%
20%
20%
Tax Revenue
 
 
 
 
 
 
30%
Tax Segment Income*
 
 
 
 
 
 
30%
Paid DDIY Efiles
 
 
 
20%
 
 
20%
HDV Net Revenue
 
 
 
 
 
30%
 
HDV Segment Income*
 
 
 
 
 
30%
 
Fee Base Net Flows
 
 
 
 
 
20%
 
Advisor Recruiting
 
 
 
20%
 
 
 
Total
100%
100%
100%
100%
100%
100%
100%

*Pre-bonus

Each financial component may be achieved at a payout percentage ranging from 0
to 150%. The relevant Executive Bonus Payment Scale set forth in the Bonus
Scales section is applied to determine the payout percentage of the financial
performance components. The financial performance component targets at 100%
match the corresponding operating plans for HDV, TaxAct and corporate opex
approved by the Board of Directors. Efile targets shall be adjusted based on
actual overall market performance relative to the assumptions for overall market
performance in the budget model.

Financial Targets

The financial performance components used to determine the bonus achievement are
defined below. All components that are subject to normalization (e.g., removal
of non-recurring expenses and/or revenue) shall only be so adjusted by the
Compensation Committee, in its sole discretion.

•
Consolidated Revenue: Consolidated, externally reported Revenue

•
Consolidated Adjusted EBITDA: Consolidated, externally reported EBITDA,
normalized for internally developed software and other non-operational items

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•
Segment Revenue or Income (as applicable): Externally reported Income or Revenue
for the applicable segment, with Income normalized for internally developed
software and other non-operational items

•
Paid DDIY Efiles: Total DDIY efiles that are paid during the IRS designated
filing season

•
Fee Based Net Flows: Actual new fee based assets relative to plan

•
Advisor Recruiting: Actual new advisors onboarded onto the HD Vest platform
relative to plan

Bonus Scales

The applicable Executive Bonus Payment Scale below will be used to calculate the
available amounts to be paid to each executive based on the financial
performance components.
Performance Level
Financial Performance vs. Target
Bonus Achievement
Added Payout Rate Per 1% Attainment
Below Minimum
0% - 79%
0.0%
----
Decelerated
80% - 84%
50.0% - 78%
7%
1:1
85% - 115%
85% - 115%
----
Accelerated
116% - 120%
122% - 150%
7%
Maximum
> 120%
Capped at 150%
----

•
Rounding. Performance results will be rounded up to the nearest whole percentage
point. For example, if the calculated performance achievement percentage is
79.1%, it will be rounded up to 80%.

•
Performance Thresholds. There will be no payout for a financial performance
component if the minimum specified threshold is not achieved. However, if the
threshold for one financial performance component is not achieved, a bonus may
still be earned on the other financial performance component(s), provided
performance for that measure achieves the applicable threshold.

•
Acceleration Below and Above Target. For determining bonus achievement
percentage where a range is indicated in the financial performance vs. target
column, the whole percentage point of financial performance achieved is mapped
to the corresponding bonus achievement percentage using a linear scale between
the low and high points in the range.

EMPLOYMENT REQUIREMENTS
In order to be eligible for a bonus payment under the Plan, and for a bonus to
be considered earned under the Plan, participants must be employed at the end of
the fiscal year; provided, however, that if a participant’s employment is
terminated during the year “without Cause” or by the participant for “Good
Reason” or due to “Constructive Termination” as such terms are defined in the
applicable participant’s employment agreement, then the participant will be
entitled to accrued bonus as of the date of his or her

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termination. Accrued bonus will be calculated as pro-rata achievement of
financial performance components based on the then-current annual forecast.

APPROVAL
All bonus payments made to executives will be submitted to the Compensation
Committee for final approval. The Compensation Committee may adjust the final
bonus amount as it deems appropriate. The Committee has sole discretion to
adjust bonus awards to reflect changes in the industry, company, the executive’s
job duties or performance, or any other circumstance the Committee determines
should impact bonus awards.

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