Document:

Exhibit

Exhibit 10.2

ALARM.COM HOLDINGS, INC. 
 
2015 EMPLOYEE STOCK PURCHASE PLAN
 
ADOPTED BY THE BOARD OF DIRECTORS: JUNE 9, 2015 
APPROVED BY THE STOCKHOLDERS:  JUNE 12, 2015
IPO DATE/EFFECTIVE DATE: JUNE 25, 2015
1.    GENERAL; PURPOSE.
(a)    The Plan provides a means by which Eligible Employees of the Company and certain Designated Companies may be given an opportunity to purchase shares of Common Stock.  The Plan permits the Company to grant a series of Purchase Rights to Eligible Employees under an Employee Stock Purchase Plan.
(b)    The Company, by means of the Plan, seeks to retain the services of such Employees, to secure and retain the services of new Employees and to provide incentives for such persons to exert maximum efforts for the success of the Company and its Related Corporations.
(c)    The Plan includes two components: a 423 Component and a Non-423 Component.  The Company intends (but makes no undertaking or representation to maintain) the 423 Component to qualify as an Employee Stock Purchase Plan.  The provisions of the 423 Component, accordingly, will be construed in a manner that is consistent with the requirements of Section 423 of the Code.  In addition, this Plan authorizes grants of Purchase Rights under the Non-423 Component that do not meet the requirements of an Employee Stock Purchase Plan.  Except as otherwise provided in the Plan or determined by the Board, the Non-423 Component will operate and be administered in the same manner as the 423 Component.  In addition, under the 423 Component, the Company may make separate Offerings which vary in terms (provided that such terms are not inconsistent with the provisions of the Plan or the requirements of an Employee Stock Purchase Plan), and the Company will designate which Designated Company is participating in each separate Offering.
2.    ADMINISTRATION.
(a)    The Board will administer the Plan unless and until the Board delegates administration of the Plan to a Committee or Committees, as provided in Section 2(c).
(b)    The Board will have the power, subject to, and within the limitations of, the express provisions of the Plan:
(i)    To determine how and when Purchase Rights will be granted and the provisions of each Offering (which need not be identical).
(ii)    To designate from time to time which Related Corporations of the Company will be eligible to participate in the Plan as Designated 423 Corporations or as Designated Non-423 Corporations, which Affiliates may be excluded from participation in the Plan, and which Designated Companies will participate in each separate Offering (to the extent that the Company makes separate Offerings).
(iii)    To construe and interpret the Plan and Purchase Rights, and to establish, amend and revoke rules and regulations for its administration.  The Board, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan, in a manner and to the extent it deems necessary or expedient to make the Plan fully effective.
(iv)    To settle all controversies regarding the Plan and Purchase Rights granted under the Plan.
(v)    To suspend or terminate the Plan at any time as provided in Section 12.
(vi)    To amend the Plan at any time as provided in Section 12.

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(vii)    Generally, to exercise such powers and to perform such acts as it deems necessary or expedient to promote the best interests of the Company, its Related Corporations and Affiliates and to carry out the intent that the 423 Component be treated as an Employee Stock Purchase Plan.
(viii)    To adopt such procedures and sub-plans as are necessary or appropriate to permit or facilitate participation in the Plan by Employees who are foreign nationals or employed or located outside the United States.  Without limiting the generality of, but consistent with, the foregoing, the Board specifically is authorized to adopt rules, procedures, and sub-plans, which, for purposes of the Non-423 Component, may be beyond the scope of Section 423 of the Code, regarding, without limitation, eligibility to participate in the Plan, handling and making of Contributions, establishment of bank or trust accounts to hold Contributions, payment of interest, conversion of local currency, obligations to pay payroll tax, determination of beneficiary designation requirements, withholding procedures and handling of share issuances, any of which may vary according to applicable requirements.
(c)    The Board may delegate some or all of the administration of the Plan to a Committee or Committees.  If administration is delegated to a Committee, the Committee will have, in connection with the administration of the Plan, the powers theretofore possessed by the Board that have been delegated to the Committee, including the power to delegate to a subcommittee any of the administrative powers the Committee is authorized to exercise (and references in this Plan to the Board will thereafter be to the Committee or subcommittee), subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by the Board.  The Board may retain the authority to concurrently administer the Plan with the Committee and may, at any time, revest in the Board some or all of the powers previously delegated.  Whether or not the Board has delegated administration of the Plan to a Committee, the Board will have the final power to determine all questions of policy and expediency that may arise in the administration of the Plan.
(d)    All determinations, interpretations and constructions made by the Board in good faith will not be subject to review by any person and will be final, binding and conclusive on all persons.
3.    SHARES OF COMMON STOCK SUBJECT TO THE PLAN.
(a)    Subject to the provisions of Section 11(a) relating to Capitalization Adjustments, the maximum number of shares of Common Stock that may be issued under the Plan will not exceed 1,200,000 shares of Common Stock, plus the number of shares of Common Stock that are automatically added on January 1 of each year, commencing on (and including) January 1, 2016 and ending on (and including) January 1, 2025, in an amount equal to the lesser of (i) 1% of the total number of shares of Capital Stock outstanding on December 31 of the preceding fiscal year, (ii) 1,500,000 shares of common stock or (iii) such lesser number as determined by the Board.  Notwithstanding the foregoing, the Board may act prior to the first day of any fiscal year to provide that there will be no January 1 increase in the share reserve for such fiscal year or that the increase in the share reserve for such fiscal year will be a lesser number of shares of Common Stock than would otherwise occur pursuant to the preceding sentence.
(b)    If any Purchase Right granted under the Plan terminates without having been exercised in full, the shares of Common Stock not purchased under such Purchase Right will again become available for issuance under the Plan.  
(c)    The stock purchasable under the Plan will be shares of authorized but unissued or reacquired Common Stock, including shares repurchased by the Company on the open market.  
4.    GRANT OF PURCHASE RIGHTS; OFFERING.
(a)    The Board may from time to time grant or provide for the grant of Purchase Rights to Eligible Employees under an Offering (consisting of one or more Purchase Periods) on an Offering Date or Offering Dates selected by the Board.  Each Offering will be in such form and will contain such terms and conditions as the Board will deem appropriate, and with respect to the 423 Component, will comply with the requirement of Section 423(b)(5) of the Code that all Employees granted Purchase Rights will have the same rights and privileges.  The terms and conditions of an Offering shall be incorporated by reference into the Plan and treated as part of the Plan.  The provisions of separate Offerings need not be identical, but each Offering will include (through incorporation of the provisions of this Plan by reference in the document comprising the Offering or otherwise) the period during which the Offering will be effective, which period will not exceed 27 months beginning with the Offering Date, and the substance of the provisions contained in Sections 5 through 8, inclusive.

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(b)    If a Participant has more than one Purchase Right outstanding under the Plan, unless he or she otherwise indicates in forms delivered to the Company: (i) each form will apply to all of his or her Purchase Rights under the Plan, and (ii) a Purchase Right with a lower exercise price (or an earlier-granted Purchase Right, if different Purchase Rights have identical exercise prices) will be exercised to the fullest possible extent before a Purchase Right with a higher exercise price (or a later-granted Purchase Right if different Purchase Rights have identical exercise prices) will be exercised.
(c)    The Board will have the discretion to structure an Offering so that if the Fair Market Value of a share of Common Stock on the first Trading Day of a new Purchase Period within that Offering is less than or equal to the Fair Market Value of a share of Common Stock on the Offering Date for that Offering, then (i) that Offering will terminate immediately as of that first Trading Day, and (ii) the Participants in such terminated Offering will be automatically enrolled in a new Offering beginning on the first Trading Day of such new Purchase Period.  
5.    ELIGIBILITY.
(a)    Purchase Rights may be granted only to Employees of the Company or, as the Board may designate in accordance with Section 2(b), to Employees of a Related Corporation or an Affiliate.  Except as provided in Section 5(b), an Employee will not be eligible to be granted Purchase Rights unless, on the Offering Date, the Employee has been in the employ of the Company, a Related Corporation, or an Affiliate, as the case may be, for such continuous period preceding such Offering Date as the Board may require, but in no event will the required period of continuous employment be equal to or greater than two years.  In addition, the Board may provide that no Employee will be eligible to be granted Purchase Rights under the Plan unless, on the Offering Date, such Employee’s customary employment with the Company, the Related Corporation, or the Affiliate, as applicable, is more than 20 hours per week and more than five months per calendar year or such other criteria as the Board may determine consistent with Section 423 of the Code, unless such exclusion from eligibility is prohibited by applicable laws or regulations.  
(b)    The Board may provide that each person who, during the course of an Offering, first becomes an Eligible Employee will, on a date or dates specified in the Offering which coincides with the day on which such person becomes an Eligible Employee or which occurs thereafter, receive a Purchase Right under that Offering, which Purchase Right will thereafter be deemed to be a part of that Offering.  Such Purchase Right will have the same characteristics as any Purchase Rights originally granted under that Offering, as described herein, except that:
(i)    the date on which such Purchase Right is granted will be the “Offering Date” of such Purchase Right for all purposes, including determination of the exercise price of such Purchase Right;
(ii)    the period of the Offering with respect to such Purchase Right will begin on its Offering Date and end coincident with the end of such Offering; and
(iii)    the Board may provide that if such person first becomes an Eligible Employee within a specified period of time before the end of the Offering, he or she will not receive any Purchase Right under that Offering.
(c)    No Employee will be eligible for the grant of any Purchase Rights if, immediately after any such Purchase Rights are granted, such Employee owns stock possessing five percent or more of the total combined voting power or value of all classes of stock of the Company or of any Related Corporation.  For purposes of this Section 5(c), the rules of Section 424(d) of the Code will apply in determining the stock ownership of any Employee, and stock which such Employee may purchase under all outstanding Purchase Rights and options will be treated as stock owned by such Employee.
(d)    As specified by Section 423(b)(8) of the Code, an Eligible Employee may be granted Purchase Rights only if such Purchase Rights, together with any other rights granted under all Employee Stock Purchase Plans of the Company and any Related Corporations, do not permit such Eligible Employee’s rights to purchase stock of the Company or any Related Corporation to accrue at a rate which exceeds $25,000 of Fair Market Value of such stock (determined at the time such rights are granted, and which, with respect to the Plan, will be determined as of their respective Offering Dates) for each calendar year in which such rights are outstanding at any time.
(e)    Officers of the Company and any Designated Company, if they are otherwise Eligible Employees, will be eligible to participate in Offerings under the Plan.  Notwithstanding the foregoing, the Board may provide in an Offering that Employees who are highly compensated Employees within the meaning of Section 423(b)(4)(D) of the Code will not be eligible to participate, unless such exclusion from eligibility is prohibited by applicable laws or regulations.

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6.    PURCHASE RIGHTS; PURCHASE PRICE.
(a)    On each Offering Date, each Eligible Employee, pursuant to an Offering made under the Plan, will be granted a Purchase Right to purchase up to that number of shares of Common Stock purchasable either with a percentage or with a maximum dollar amount, as designated by the Board, but in either case not exceeding 15% of such Employee’s earnings (as defined by the Board in each Offering) during the period that begins on the Offering Date (or such later date as the Board determines for a particular Offering) and ends on the date stated in the Offering, which date will be no later than the end of the Offering.
(b)    The Board will establish one or more Purchase Dates during an Offering on which Purchase Rights granted for that Offering will be exercised and shares of Common Stock will be purchased in accordance with such Offering.
(c)    In connection with each Offering made under the Plan, the Board may specify (i) a maximum number of shares of Common Stock that may be purchased by any Participant on any Purchase Date during such Offering, (ii) a maximum aggregate number of shares of Common Stock that may be purchased by all Participants pursuant to such Offering and/or (iii) a maximum aggregate number of shares of Common Stock that may be purchased by all Participants on any Purchase Date under the Offering.  If the aggregate purchase of shares of Common Stock issuable upon exercise of Purchase Rights granted under the Offering would exceed any such maximum aggregate number, then, in the absence of any Board action otherwise, a pro rata (based on each Participant’s accumulated Contributions) allocation of the shares of Common Stock available will be made in as nearly a uniform manner as will be practicable and equitable.
(d)    Subject to such other limitations determined by the Board, the purchase price of shares of Common Stock acquired pursuant to Purchase Rights will be not less than the lesser of:
(i)    an amount equal to 85% of the Fair Market Value of the shares of Common Stock on the Offering Date; and
(ii)    an amount equal to 85% of the Fair Market Value of the shares of Common Stock on the applicable Purchase Date.
7.    PARTICIPATION; WITHDRAWAL; TERMINATION.
(a)    An Eligible Employee may elect to authorize payroll deductions as the means of making Contributions by completing and delivering to the Company, within the time specified in the Offering, an enrollment form provided by the Company.  The enrollment form will specify the amount of Contributions not to exceed the maximum amount specified by the Board.  Each Participant’s Contributions will be credited to a bookkeeping account for such Participant under the Plan and will be deposited with the general funds of the Company except where applicable laws or regulations require that Contributions be deposited with a third party or otherwise be segregated.  If permitted in the Offering, a Participant may begin such Contributions with the first payroll occurring on or after the Offering Date (or, in the case of a payroll date that occurs after the end of the prior Offering but before the Offering Date of the next new Offering, Contributions from such payroll will be included in the new Offering).  If permitted in the Offering, a Participant may thereafter reduce (including to zero) or increase his or her Contributions.  If required under applicable laws or regulations or if specifically provided in the Offering, in addition to or instead of making Contributions by payroll deductions, a Participant may make Contributions through a payment by cash, check or wire transfer prior to a Purchase Date, in a manner directed by the Company.
(b)    During an Offering, a Participant may cease making Contributions and withdraw from the Offering by delivering to the Company a withdrawal form provided by the Company.  The Company may impose a deadline before a Purchase Date for withdrawing.  Upon such withdrawal, such Participant’s Purchase Right in that Offering will immediately terminate and the Company will distribute to such Participant all of his or her accumulated but unused Contributions and such Participant’s Purchase Right in that Offering shall thereupon terminate.  A Participant’s withdrawal from that Offering will have no effect upon his or her eligibility to participate in any other Offerings under the Plan, but such Participant will be required to deliver a new enrollment form to participate in subsequent Offerings.
(c)    Unless otherwise required by applicable laws or regulations, Purchase Rights granted pursuant to any Offering under the Plan will terminate immediately if the Participant either (i) is no longer an Employee for any reason or for no reason or (ii) is otherwise no longer eligible to participate. The Company will distribute to such individual all of his or her accumulated but unused Contributions. 

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(d)    During a Participant’s lifetime, Purchase Rights will be exercisable only by such Participant.  Purchase Rights are not transferable by a Participant, except by will, by the laws of descent and distribution, or, if permitted by the Company, by a beneficiary designation as described in Section 10.  
(e)    Unless otherwise specified in the Offering, the Company will have no obligation to pay interest on Contributions, unless required to do so by applicable laws or regulations.
8.    EXERCISE OF PURCHASE RIGHTS.
(a)    On each Purchase Date, each Participant’s accumulated Contributions will be applied to the purchase of shares of Common Stock, up to the maximum number of shares of Common Stock permitted by the Plan and the applicable Offering, at the purchase price specified in the Offering.  No fractional shares will be issued unless specifically provided for in the Offering.
(b)    If any amount of accumulated Contributions remains in a Participant’s account after the purchase of shares of Common Stock and such remaining amount is less than the amount required to purchase one share of Common Stock on the final Purchase Date of an Offering, then such remaining amount will be held in such Participant’s account for the purchase of shares of Common Stock under the next Offering under the Plan, unless such Participant withdraws from or is not eligible to participate in such Offering, in which case such amount will be distributed to such Participant after the final Purchase Date, without interest.  If the amount of Contributions remaining in a Participant’s account after the purchase of shares of Common Stock is at least equal to the amount required to purchase one whole share of Common Stock on the final Purchase Date of an Offering, then such remaining amount will not roll over to the next Offering and will instead be distributed in full to such Participant after the final Purchase Date of such Offering without interest.
(c)    No Purchase Rights may be exercised to any extent unless the shares of Common Stock to be issued upon such exercise under the Plan are covered by an effective registration statement pursuant to the Securities Act and the Plan is in material compliance with all applicable U.S. federal and state, foreign and other securities and other laws applicable to the Plan.  If on a Purchase Date the shares of Common Stock are not so registered or the Plan is not in such compliance, no Purchase Rights will be exercised on such Purchase Date, and the Purchase Date will be delayed until the shares of Common Stock are subject to such an effective registration statement and the Plan is in material compliance, except that the Purchase Date will in no event be more than 6 months from the Offering Date.  If, on the Purchase Date, as delayed to the maximum extent permissible, the shares of Common Stock are not registered and the Plan is not in material compliance with all applicable laws or regulations, as determined by the Company in its sole discretion, no Purchase Rights will be exercised and all accumulated but unused Contributions will be distributed to the Participants without interest, unless otherwise required by applicable laws or regulations.
9.    COVENANTS OF THE COMPANY.
The Company will seek to obtain from each U.S. federal or state, foreign or other regulatory commission or agency having jurisdiction over the Plan such authority as may be required to grant Purchase Rights and issue and sell shares of Common Stock thereunder unless the Company determines in its sole discretion, that doing so would cause the Company to incur costs that are unreasonable.  If, after commercially reasonable efforts, the Company is unable to obtain the authority that counsel for the Company deems necessary for the grant of Purchase Rights or the lawful issuance and sale of Common Stock under the Plan, and at a commercially reasonable cost, the Company will be relieved from any liability for failure to grant Purchase Rights and/or to issue and sell Common Stock upon exercise of such Purchase Rights.
10.    DESIGNATION OF BENEFICIARY.
(a)    The Company may, but is not obligated to, permit a Participant to submit a form designating a beneficiary who will receive any shares of Common Stock and/or Contributions from the Participant’s account under the Plan if the Participant dies before such shares and/or Contributions are delivered to the Participant.  The Company may, but is not obligated to, permit the Participant to change such designation of beneficiary. Any such designation and/or change must be on a form approved by the Company.
(b)    If a Participant dies, in the absence of a valid beneficiary designation, the Company will deliver any shares of Common Stock and/or Contributions to the executor or administrator of the estate of the Participant.  If, to the knowledge of the Company, no executor or administrator has been appointed, the Company, in its sole discretion, may 

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deliver such shares of Common Stock and/or Contributions to the Participant’s spouse, dependents or relatives, or if no spouse, dependent or relative is known to the Company, then to such other person as the Company may designate.
11.    ADJUSTMENTS UPON CHANGES IN COMMON STOCK; CORPORATE TRANSACTIONS.
(a)    In the event of a Capitalization Adjustment, the Board will appropriately and proportionately adjust: (i) the class(es) and maximum number of securities subject to the Plan pursuant to Section 3(a), (ii) the class(es) and maximum number of securities by which the share reserve is to increase automatically each year pursuant to Section 3(a), (iii) the class(es) and number of securities subject to, and the purchase price applicable to outstanding Offerings and Purchase Rights, and (iv) the class(es) and number of securities that are the subject of the purchase limits under each ongoing Offering.  The Board will make these adjustments, and its determination will be final, binding and conclusive. 
(b)    In the event of a Corporate Transaction, then: (i) any surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company) may assume or continue outstanding Purchase Rights or may substitute similar rights (including a right to acquire the same consideration paid to the stockholders in the Corporate Transaction) for outstanding Purchase Rights, or (ii) if any surviving or acquiring corporation (or its parent company) does not assume or continue such Purchase Rights or does not substitute similar rights for such Purchase Rights, then the Participants’ accumulated Contributions will be used to purchase shares of Common Stock within ten business days prior to the Corporate Transaction under the outstanding Purchase Rights, and the Purchase Rights will terminate immediately after such purchase.
12.    AMENDMENT, TERMINATION OR SUSPENSION OF THE PLAN.
(a)    The Board may amend the Plan at any time in any respect the Board deems necessary or advisable.  However, except as provided in Section 11(a) relating to Capitalization Adjustments, stockholder approval will be required for any amendment of the Plan for which stockholder approval is required by applicable laws, regulations or listing requirements, including any amendment that either (i) materially increases the number of shares of Common Stock available for issuance under the Plan, (ii) materially expands the class of individuals eligible to become Participants and receive Purchase Rights, (iii) materially increases the benefits accruing to Participants under the Plan or materially reduces the price at which shares of Common Stock may be purchased under the Plan, (iv) materially extends the term of the Plan, or (v) expands the types of awards available for issuance under the Plan, but in each of (i) through (v) above only to the extent stockholder approval is required by applicable laws, regulations or listing requirements.
(b)    The Board may suspend or terminate the Plan at any time.  No Purchase Rights may be granted under the Plan while the Plan is suspended or after it is terminated.
(c)    Any benefits, privileges, entitlements and obligations under any outstanding Purchase Rights granted before an amendment, suspension or termination of the Plan will not be materially impaired by any such amendment, suspension or termination except (i) with the consent of the person to whom such Purchase Rights were granted, (ii) as necessary to comply with any laws, listing requirements, or governmental regulations (including, without limitation, the provisions of Section 423 of the Code and the regulations and other interpretive guidance issued thereunder relating to Employee Stock Purchase Plans) including without limitation any such regulations or other guidance that may be issued or amended after the date the Plan is adopted by the Board, or (iii) as necessary to obtain or maintain any special tax, listing, or regulatory treatment.  To be clear, the Board may amend outstanding Purchase Rights without a Participant’s consent if such amendment is necessary to ensure that the Purchase Right and/or the 423 Component complies with the requirements of Section 423 of the Code.
13.    SECTION 409A OF THE CODE; TAX QUALIFICATION.
(a)    Purchase Rights granted under the 423 Component are intended to be exempt from the application of Section 409A of the Code under U.S. Treasury Regulation Section 1.409A-1(b)(5)(ii).  Purchase Rights granted under the Non-423 Component to U.S. taxpayers are intended to be exempt from the application of Section 409A of the Code under the short-term deferral exception and any ambiguities will be construed and interpreted in accordance with such intent.  Subject to Section 13(b) below, Purchase Rights granted to U.S. taxpayers under the Non-423 Component will be subject to such terms and conditions that will permit such Purchase Rights to satisfy the requirements of the short-term deferral exception available under Section 409A of the Code, including the requirement that the shares subject to a Purchase Right be delivered within the short-term deferral period.  Subject to Section 13(b) below, in the case of a Participant who would otherwise be subject to Section 409A of the Code, to the extent the Board determines that a Purchase Right or the exercise, payment, settlement or deferral thereof is subject to Section 409A of the Code, the 

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Purchase Right will be granted, exercised, paid, settled or deferred in a manner that will comply with Section 409A of the Code, including U.S. Department of Treasury regulations and other interpretive guidance issued thereunder, including, without limitation, any such regulations or other guidance that may be issued after the adoption of the Plan.  Notwithstanding the foregoing, the Company will have no liability to a Participant or any other party if the Purchase Right that is intended to be exempt from or compliant with Section 409A of the Code is not so exempt or compliant or for any action taken by the Board with respect thereto. 
(b)    Although the Company may endeavor to (i) qualify a Purchase Right for special tax treatment under the laws of the United States or jurisdictions outside of the United States or (ii) avoid adverse tax treatment (e.g., under Section 409A of the Code), the Company makes no representation to that effect and expressly disavows any covenant to maintain special or to avoid unfavorable tax treatment, notwithstanding anything to the contrary in this Plan, including Section 13(a) above.  The Company will be unconstrained in its corporate activities without regard to the potential negative tax impact on Participants under the Plan. 
14.    EFFECTIVE DATE OF PLAN.
The Plan will become effective immediately prior to and contingent upon the IPO Date.  No Purchase Rights will be exercised unless and until the Plan has been approved by the stockholders of the Company, which approval must be within 12 months before or after the date the Plan is adopted (or if required under Section 12(a) above, materially amended) by the Board. 
15.    MISCELLANEOUS PROVISIONS.
(a)    Proceeds from the sale of shares of Common Stock pursuant to Purchase Rights will constitute general funds of the Company.
(b)    A Participant will not be deemed to be the holder of, or to have any of the rights of a holder with respect to, shares of Common Stock subject to Purchase Rights unless and until the Participant’s shares of Common Stock acquired upon exercise of Purchase Rights are recorded in the books of the Company (or its transfer agent).
(c)    The Plan and Offering do not constitute an employment contract.  Nothing in the Plan or in the Offering will in any way alter the at will nature of a Participant’s employment, if applicable, or be deemed to create in any way whatsoever any obligation on the part of any Participant to continue in the employ of the Company, a Related Corporation, or an Affiliate, or on the part of the Company, a Related Corporation, or an Affiliate to continue the employment of a Participant.
(d)    The provisions of the Plan will be governed by the laws of the State of Delaware without resort to that state’s conflicts of laws rules.
(e)    If any particular provision of the Plan is found to be invalid or otherwise unenforceable, such provision will not affect the other provisions of the Plan, but the Plan will be construed in all respects as if such invalid provision were omitted. 
16.    DEFINITIONS.
As used in the Plan, the following definitions will apply to the capitalized terms indicated below:
(a)    “423 Component” means the part of the Plan, which excludes the Non-423 Component, pursuant to which Purchase Rights that satisfy the requirements for an Employee Stock Purchase Plan may be granted to Eligible Employees.
(b)    “Affiliate” means any branch or representative office or other disregarded entity of a Related Corporation, as determined by the Board, whether now or hereafter existing.
(c)     “Board” means the Board of Directors of the Company.
(d)    “Capital Stock” means each and every class of common stock of the Company, regardless of the number of votes per share.

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(e)    “Capitalization Adjustment” means any change that is made in, or other events that occur with respect to, the Common Stock subject to the Plan or subject to any Purchase Right after the date the Plan is adopted by the Board without the receipt of consideration by the Company through merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, large nonrecurring cash dividend, stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or other similar equity restructuring transaction, as that term is used in Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any successor thereto).  Notwithstanding the foregoing, the conversion of any convertible securities of the Company will not be treated as a Capitalization Adjustment.
(f)    “Code” means the U.S. Internal Revenue Code of 1986, as amended, including any applicable regulations and guidance thereunder.
(g)    “Committee” means a committee of one or more members of the Board to whom authority has been delegated by the Board in accordance with Section 2(c).
(h)    “Common Stock” means, as of the IPO Date, the common stock of the Company.
(i)    “Company” means Alarm.com Holdings, a Delaware corporation.
(j)    “Contributions” means the payroll deductions and/or other payments specifically provided for in the Offering that a Participant contributes to fund the exercise of a Purchase Right. A Participant may make additional payments into his or her account if specifically provided for in the Offering, and then only if the Participant has not already had the maximum permitted amount withheld during the Offering through payroll deductions.
(k)    “Corporate Transaction” means the consummation, in a single transaction or in a series of related transactions, of any one or more of the following events:
(i)    a sale or other disposition of all or substantially all, as determined by the Board in its sole discretion, of the consolidated assets of the Company and its Subsidiaries;
(ii)    a sale or other disposition of at least 90% of the outstanding securities of the Company;
(iii)    a merger, consolidation or similar transaction following which the Company is not the surviving corporation; or
(iv)    a merger, consolidation or similar transaction following which the Company is the surviving corporation but the shares of Common Stock outstanding immediately preceding the merger, consolidation or similar transaction are converted or exchanged by virtue of the merger, consolidation or similar transaction into other property, whether in the form of securities, cash or otherwise.
(l)    “Designated Company” means any Designated Non-423 Corporation or Designated 423 Corporation.
(m)    “Designated 423 Corporation” means any Related Corporation selected by the Board as participating in the 423 Component.
(n)     “Designated Non-423 Corporation” means any Related Corporation or Affiliate selected by the Board as participating in the Non-423 Component.
(o)     “Director” means a member of the Board.
(p)    “Eligible Employee” means an Employee who meets the requirements set forth in the document(s) governing the Offering for eligibility to participate in the Offering, provided that such Employee also meets the requirements for eligibility to participate set forth in the Plan.
(q)    “Employee” means any person, including an Officer or Director, who is treated as an employee in the records of the Company or a Related Corporation (including an Affiliate).  However, service solely as a Director, or payment of a fee for such services, will not cause a Director to be considered an “Employee” for purposes of the Plan.  

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(r)    “Employee Stock Purchase Plan” means a plan that grants Purchase Rights intended to be options issued under an “employee stock purchase plan,” as that term is defined in Section 423(b) of the Code.
(s)    “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended and the rules and regulations promulgated thereunder.
(t)    “Fair Market Value” means, as of any date, the value of the Common Stock determined as follows:
(i)    If the Common Stock is listed on any established stock exchange or traded on any established market, the Fair Market Value of a share of Common Stock will be the closing sales price for such stock as quoted on such exchange or market (or the exchange or market with the greatest volume of trading in the Common Stock) on the date of determination, as reported in such source as the Board deems reliable.  Unless otherwise provided by the Board, if there is no closing sales price for the Common Stock on the date of determination, then the Fair Market Value will be the closing sales price on the last preceding date for which such quotation exists.
(ii)    In the absence of such markets for the Common Stock, the Fair Market Value will be determined by the Board in good faith in compliance with applicable laws and regulations and in a manner that complies with Sections 409A of the Code.
(iii)    Notwithstanding the foregoing, for any Offering that commences on the IPO Date, the Fair Market Value of the shares of Common Stock on the Offering Date will be the price per share at which shares are first sold to the public in the Company’s initial public offering as specified in the final prospectus for that initial public offering.
(u)    “IPO Date” means the date of the underwriting agreement between the Company and the underwriter(s) managing the initial public offering of the Common Stock, pursuant to which the Common Stock is priced for the initial public offering.
(v)    “Non-423 Component” means the part of the Plan, which excludes the 423 Component, pursuant to which Purchase Rights that are not intended to satisfy the requirements for an Employee Stock Purchase Plan may be granted to Eligible Employees.
(w)     “Offering” means the grant to Eligible Employees of Purchase Rights, with the exercise of those Purchase Rights automatically occurring at the end of one or more Purchase Periods. The terms and conditions of an Offering will generally be set forth in the “Offering Document” approved by the Board for that Offering.
(x)    “Offering Date” means a date selected by the Board for an Offering to commence.
(y)    “Officer” means a person who is an officer of the Company or a Related Corporation within the meaning of Section 16 of the Exchange Act.
(z)    “Participant” means an Eligible Employee who holds an outstanding Purchase Right.
(aa)    “Plan” means this Alarm.com Holdings, Inc. 2015 Employee Stock Purchase Plan, including both the 423 Component and the Non-423 Component, as amended from time to time.
(bb)    “Purchase Date” means one or more dates during an Offering selected by the Board on which Purchase Rights will be exercised and on which purchases of shares of Common Stock will be carried out in accordance with such Offering.
(cc)    “Purchase Period” means a period of time specified within an Offering, generally beginning on the Offering Date or on the first Trading Day following a Purchase Date, and ending on a Purchase Date.  An Offering may consist of one or more Purchase Periods.
(dd)    “Purchase Right” means an option to purchase shares of Common Stock granted pursuant to the Plan.

9

(ee)    “Related Corporation” means any “parent corporation” or “subsidiary corporation” of the Company whether now or subsequently established, as those terms are defined in Sections 424(e) and (f), respectively, of the Code.
(ff)    “Securities Act” means the U.S. Securities Act of 1933, as amended.
(gg)    “Trading Day” means any day on which the exchange(s) or market(s) on which shares of Common Stock are listed, including but not limited to the NYSE, Nasdaq Global Select Market, the Nasdaq Global Market, the Nasdaq Capital Market or any successors thereto, is open for trading.

10Exhibit 10.13

 

EMPLOYMENT
AGREEMENT

THIS
EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”), dated as of August 11, 2015 is entered into by and between FlexShopper,
Inc., a Delaware corporation (together with its subsidiaries, the “Company”), and Marc Malaga (the “Employee”).

W
I T N E S S E T H:

WHEREAS,
the Employee desires to serve the Company as Executive Vice President - Operations; and

WHEREAS,
the Company desires to employ the Employee as Executive Vice President Operations.

 

NOW
THEREFORE in consideration of the mutual benefits to be derived from this Agreement, the Company and the Employee hereby agree
as follows:

1.
Term of Employment; Office and Duties.

(a)
Commencing on the date hereof, and for an initial term ending August 10, 2016, the Company shall employ the Employee as Executive
Vice President -Operations, with such duties and responsibilities consistent with such position as may from time to time be assigned
to the Employee by the Company’s Board of Directors. The Employee agrees to perform such duties and discharge such responsibilities
in accordance with the terms of this Agreement. This Agreement shall be automatically renewed for additional one year terms unless
either party notifies the other, in writing, at least 60 days prior to the expiration of the term, of such party’s intention
not to renew this Agreement. The period that the Employee serves as an employee of the Company pursuant to this Agreement, including
as a result of any extension of the initial term, shall be referred to as the “Employment Term.”

(b)
The Employee shall be required to devote his full business time and efforts to the business and affairs of the Company other than
during vacations and periods of illness or incapacity. Notwithstanding the foregoing, the Employee shall be permitted to: (i)
serve as a director of any organization or entity that does not result in a violation of Section 5; (ii) deliver lectures or fulfill
speaking engagements; or (iii) make and manage passive investments and engage in charitable and community activities but only
if such services and activities do not interfere with the performance of his duties and responsibilities under this Agreement.

2.
Compensation and Benefits. For all services rendered by the Employee during the Employment Term, including, without limitation,
any services as a director generally or member of the any committee of the Board or any subsidiary or division thereof, the Employee
shall be compensated as follows:

(a)
Base Salary. The Company shall pay the Employee a fixed base salary (“Base Salary”) of $175,000 during the first year
of the Employment Term, and any additional year of the Employment Term. The Board may periodically review the Employee's Base
Salary and may determine to increase (but not decrease) the Base Salary, in accordance with such policies as the Company may hereafter
adopt.

    	1

    	 

    

from
time to time, if it deems appropriate. Base Salary will be payable in accordance with the customary payroll practices of the Company.
As part of the Employee’s compensation program the Company extends a $1000 per month automobile allowance; it being understood
the Company shall not be responsible for any insurance, repairs, tires gas or other expenses related to Employee’s automobile
except as provided in Section 3.

(b)
Bonus. The Employee may be entitled to receive an annual bonus (“Annual Bonus”) for each fiscal year payable subsequent
to the issuance of final audited financial statements for such fiscal year in the sole discretion of the Board in an amount as
determined by the Compensation Committee of the Board. The targeted amount of any Annual Bonus (the “Target Bonus”)
shall be determined by the Compensation Committee of the Board in its discretion.

(c)
Fringe Benefits. (i) The Employee shall be entitled to participate in such employee benefit and other compensatory or non-compensatory
plans that are available to similarly situated executives of the Company, which may include disability, health, dental and life
insurance plans, option and bonus plans and other fringe benefit plans or programs, including a 401(k) retirement plan, of the
Company established from time to time by the Board, subject to the rules and regulations applicable thereto, and which shall include
an executive insurance program under which Employee shall be entitled to be reimbursed for up to $25,000 of medical costs not
covered by the Company’s health insurance per year.

(d)
Withholding and Employment Tax. Payment of all compensation hereunder shall be subject to customary withholding tax and other
employment taxes as may be required with respect to compensation paid by an employer to an employee.

(e)
Disability. The Company shall, to the extent such benefits can be obtained at a reasonable cost, provide the Employee with disability
insurance benefits of at least 60% of his gross Base Salary per month. In the event of the Employee's Disability (as hereinafter
defined), the Employee and his family shall continue to be covered by all of the Company's employee welfare benefit plans described
under Section 2(c), at the Company's expense, to the extent such benefits may, by law, be provided, for the lesser of the term
of such Disability and 24 months, in accordance with the terms of such plans.

(f)
Death. The Company shall, to the extent such benefits can be obtained at a reasonable cost, provide the Employee with life insurance
benefits in the amount of at least $500,000. In the event of the Employee's death, the Employee's family shall continue to be
covered by all of the Company's employee welfare benefit plans described under Section 2(c), at the Company's expense, to the
extent such benefits may, by law, be provided, for 12 months following the Employee's death in accordance with the terms of such
plans.

(g)
Vacation. The Employee shall receive four weeks of vacation annually, administered in accordance with the Company's existing vacation
policy.

3.
Business Expenses. The Company shall pay or reimburse the Employee for all reasonable travel (including travel by automobile),
business and entertainment expenses incurred by or necessary for the Employee to perform his duties under this Agreement in accordance
with such policies and procedures as the Company may from time to time establish for senior officers and subject to the Company's
normal requirements with respect to reporting and documentation of such expenses.

    	2

    	 

    

4.
Termination of Employment. Notwithstanding any other provision of this Agreement, the Employee's employment with the Company may
be terminated as set forth below:

(a)
Termination by Mutual Agreement. The Employee's employment with the Company may be terminated at anytime by, and upon the terms
and conditions of, a mutual written agreement between the parties.

(b)
Termination for Cause. The Employee's employment with the Company may be terminated by the Company for Cause. Provided Cause actually
exists, the date of termination for Cause shall be the date the Company sends the Employee a written notice to such effect specifying
the reason(s) for the termination for Cause. For purposes of this Agreement, “Cause” shall mean any one of the following:
(i) conviction of the Employee for committing a felony or crime or other crime involving moral turpitude; (ii) the Employee having
committed acts or omissions constituting willful or wanton misconduct with respect to the Company; (iii) the Employee having committed
any act of fraud or embezzlement involving the Company; (iv) the Employee having committed any willful and material violation
of any statutory or common law duty of loyalty to the Company; (v) the Employee having committed acts or omissions constituting
a material breach of this Agreement that continues for more than 15 days after notice from the Company specifically identifying
such breach. In the event of any termination under this Section 4(b), the Company shall pay all amounts of Base Salary then due
to the Employee under Section 2(a) up to the payroll period worked but for which payment had not yet been made up to the date
of termination (but expressly excluding any bonuses or other incentive compensation). The Company shall have no further obligations
to the Employee under this Agreement (including no obligation with respect to bonuses or other incentive compensation), and any
and all stock options granted to the Employee shall terminate according to their terms of grant with any such vested options being
exercisable for the shorter of (i) 90 days from the date of termination and (ii) the exercise term of each relevant option grant.

(b)
Termination for Disability. The Employee's employment with the Company may be terminated by the Company in the event of the Employee's
Disability. The date of termination for Disability shall be the date the Company sends the Employee a written notice to such effect.
In the event of any termination under this Section 4(b), on the date of termination all options that would have otherwise vested
within the 12 months following the date of the date of termination shall accelerate and immediately vest and become exercisable
in full. Such options may be exercised for the longer of (i) 12 months from the date of the date of termination and (ii) the exercise
term of each relevant option grant. For purposes of this Agreement, “Disability” shall mean the inability of the Employee,
in the reasonable judgment of a physician appointed by the Board, to perform his duties of employment because of any physical
or mental disability or incapacity, where such disability shall exist for an aggregate period of more than 150 days in any 365-day
period or for any period of 90 consecutive days. In the event of any termination under this Section 4(b), the Company shall (i)
pay by the next payroll period all amounts then due to the Employee under Section 2(a) up to the payroll period worked but for
which payment had not yet been made up to the date of termination (including bonuses then-earned or owing), and (ii) comply with
its obligations under Section 2(e).

    	3

    	 

    

(c)
Termination upon Death. The Employee's employment with the Company automatically terminates on the Employee's death. In the event
of the Employee's death (i) the Company will continue to pay the Employee's heirs or beneficiaries his Base Salary for 6 months
following the date of termination (on regular payroll dates) and (ii) on the date of termination all options that would have otherwise
vested within the 12 months following the date of the Employee's death shall accelerate and immediately vest and become exercisable
in full. Such options may be exercised for the longer of (i) 12 months from the date of the Employee's death and (ii) the exercise
term of each relevant option grant. In addition, in the event of the Employee's death, the Company shall (i) pay by the next payroll
period all amounts then due to the Employee under Section 2(a) up to the payroll period worked but for which payment had not yet
been made up to the date of termination (including bonuses then-earned or owing), and (ii) comply with its obligations under Section
2(f).

(d)
Termination without Cause. The Employee's employment with the Company may be terminated by the Company, in the absence of Cause,
for any reason and in its sole and absolute discretion, provided that in such event (which would include the Company's declining
to extend the Employment Term in accordance with Section 1(a)) the Company shall continue to pay to the Employee the Base Salary
(on regular payroll dates) for twelve months from the date of termination (the “Termination Payments”) plus any bonuses
then-earned or owing on the date of termination and an amount equal to the Target Bonus for the year in which the termination
occurs pro rated based on the number of days of service in such year. On the date of termination, all unvested options shall accelerate
and immediately vest and become exercisable in full. Such options may be exercised for the longer of (i) 12 months from the date
of termination and (ii) the exercise term of each relevant option grant. Finally, during any period in which Termination Payments
are required to be paid, the Company shall continue the benefits for the Employee and his family provided for under Section 2
at no cost to the Employee.

(e)
Termination by the Employee for Good Reason. The Employee's employment with the Company may be terminated by the Employee for
Good Reason. “Good Reason” shall be deemed to exist: (i) if the Employee’s duties or responsibilities are materially
diminished or the Employee is assigned any duties materially inconsistent with the duties or responsibilities contemplated by
this Agreement; (ii) if the Company shall have continued to fail to comply with any material provision of this Agreement after
a 30-day period to cure (if such failure is curable) following written notice by the Employee to the Company of such non-compliance;
(iii) upon a Change in Control; or (iv) if the Company requires that the Employee be based at any location other than Charlotte,
NC or Boca Raton, FL (or the suburban area of either). In the event of any termination under this Section 4(e), the Company shall
pay the Termination Payments plus any bonuses then-earned or owing on the date of termination and an amount equal to the Target
Bonus for the year in which the termination occurs pro rated based on the number of days of service in such year to the Employee
in the same amount and manner as under Section 4(d). On the date of termination, all unvested options shall accelerate and immediately
vest and become exercisable in full. Such options may be exercised for the longer of (i) 12 months from the date of termination
and (ii) the exercise term of each relevant option grant. Finally, during any period in which Termination Payments are required
to be paid, the Company shall continue the benefits for the Employee and his family provided for under Section 2 at no cost to
the Employee. (f) Voluntary Resignation. The Employee's employment with the Company may be terminated by the Employee without
Good Reason. In the event of any termination under this Section 4(f), the Company shall pay all amounts of Base Salary then due
to the Employee under Section 2(a) up to the payroll period worked but for which payment had not yet been made up to the date
of termination (but expressly excluding any bonuses or other incentive compensation). The Company shall have no further obligations
to the Employee under this Agreement (including no obligation with respect to bonuses or other incentive compensation), and any
and all stock options granted to the Employee shall terminate according to their terms of grant; provided that if such termination
occurs during the first year of the Employment Term any such vested options would be exercisable for the shorter of (i) 90 days
from the date of termination and (ii) the exercise term of each relevant option grant, and if the termination occurs thereafter
any such vested options would continue to be exercisable for the full exercise term of each relevant option grant.

    	4

    	 

    

5.
Non-Competition. During the Employment Term and for two years following termination thereof (other than any such termination by
the Company without Cause or by the Employee for Good Reason), the Employee shall not, directly or indirectly own any interest
in, manage, control, participate in, consult with, render services for, advise, or in any manner engage in the Company Business
within a 100 mile radius of any office operated by the Company or any subsidiary of the Company, whether as an officer, director,
stockholder, consultant, investor, agent or otherwise (unless the Board shall have authorized such activity and the Company shall
have consented thereto in writing). For purposes of this Section 5, “Company Business” means (i) providing accounts
receivable funding (factoring), outsourcing of accounts receivable management including collections and the risk of customer default,
purchase order financing, lawsuit financing, trade finance and government contract funding (ii) back office support including
payroll, payroll tax compliance and invoice processing services and (iii) lease-to-own, rent-to-own activities. Passive investments
in less than 5% of the outstanding securities of any entity subject to the reporting requirements of Section 13 or Section 15(d)
of the Exchange Act, shall not be prohibited by this Section 5. The provisions of this Section 5 are subject to the provisions
of Section 14.

6.
Inventions and Confidential Information. The parties hereto recognize that a major need of the Company is to preserve its specialized
knowledge, trade secrets and confidential information. The strength and good will of the Company is derived from the specialized
knowledge, trade secrets, and confidential information generated from experience with the activities undertaken by the Company.
The unauthorized disclosure of this information and knowledge to competitors would be beneficial to such competitors and detrimental
to the Company, as would the disclosure of non-public information about the marketing practices, pricing practices, costs, profit
margins, design specifications, development and business plans, analytical techniques and similar items of the Company. The Employee
acknowledges that specific proprietary information and non-public data obtained by him while employed by the Company concerning
the business or affairs of the Company are the property of the Company. By reason of his being a senior executive of the Company,
the Employee has or will have access to, and has obtained or will obtain, trade secrets and confidential information about the
Company's operations, which operations extend throughout the United States. Therefore, subject to the provisions of Section 14,
the Employee hereby agrees as follows, recognizing that the Company is relying on these agreements in entering into this Agreement:

(a)
During the Employment Term and for three years following termination of the Employee's employment with the Company for any reason,
the Employee will not use, disclose to others, or publish or otherwise make available to any other party (other than in furtherance
of his obligations hereunder) any non-public or confidential business information about the business and affairs of the Company,
including but not limited to confidential information concerning the Company's products, methods, engineering designs and standards,
analytical techniques, technical information, customer information, employee information, inventions and other confidential information
acquired by him in the course of his past or future services for the Company during the Employment Term. The Employee agrees to
hold as the Company's property all books, papers, letters, formulas, memoranda, notes, plans, records, reports, computer tapes,
printouts, software and other documents, and all copies thereof and therefrom, relating to the Company's business and affairs
conducted by him as President of the Company, whether made by him or otherwise coming into his possession or control, and on termination
of his employment, or upon demand of the Company, at any time after termination of his employment, to deliver the same to the
Company.

    	5

    	 

    

(b)
During the Employment Term and for 18 months following termination of the Employee's employment with the Company for any reason,
the Employee will not (i) directly or indirectly, including through an entity or agent, induce or otherwise attempt to influence
any employee of the Company to leave the Company's employ, (ii) hire, cause to be hired or induce a third party to hire, any such
employee (unless the Board shall have authorized such employment and the Company shall have consented thereto in writing) or in
any way materially interfere with the relationship between the Company and any employee thereof, or (iii) induce or attempt to
induce any customer, supplier, licensee, licensor or other business relation of the Company to cease or otherwise limit doing
business with the Company or in any way materially interfere to the detriment of the Company with the relationship between any
such customer, supplier, licensee or business relation of the Company.

7.
Indemnification; Director and Officer Liability Insurance. The Company will indemnify (and advance the costs of defense of) the
Employee (and his legal representatives) to the fullest extent permitted by the laws of the state in which the Company is incorporated,
as in effect at the time of the subject act or omission, or by the Certificate of Incorporation and Bylaws of the Company, as
in effect at such time or on the date of this Agreement, whichever affords greater protection to the Employee, and both during
and after termination (for any reason) of the Employee's employment, the Company shall cause the Employee to be covered under
a directors and officers' liability insurance policy for his acts (or non-acts) as an officer or director of the Company or any
of its affiliates. Such policy shall be maintained by the Company, at its expense in an amount of at least $5 million and on terms
(including the time period of coverage after the Employee's employment terminates) at least as favorable to the Employee as policies
covering the Company's other members of its Board of Directors.

8.
Litigation Expenses. In the event of any litigation or other proceeding between the Company and the Employee with respect to the
subject matter of this Agreement and the enforcement of the rights hereunder and such litigation or proceeding results in final
judgment or order in favor of the Employee, which judgment or order is substantially inconsistent with the positions asserted
by the Company in such litigation or proceeding, the losing party shall reimburse the prevailing party for all of his/its reasonable
costs and expenses relating to such litigation or other proceeding, including, without limitation, his/its reasonable attorneys'
fees and expenses. 9. Consolidation; Merger; Sale of Assets; Change of Control. Nothing in this Agreement shall preclude the Company
from combining, consolidating or merging with or into, transferring all or substantially all of its assets to, or entering into
a partnership or joint venture with, another corporation or other entity, or effecting any other kind of corporate combination
provided that the corporation resulting from or surviving such combination, consolidation or merger, or to which such assets are
transferred, or such partnership or joint venture expressly assumes in writing this Agreement and all obligations and undertakings
of the Company hereunder. Upon such a consolidation, merger, transfer of assets or formation of such partnership or joint venture,
this Agreement shall inure to the benefit of, be assumed by, and be binding upon such resulting or surviving transferee corporation
or such partnership or joint venture, and the term “Company,” as used in this Agreement, shall mean such corporation,
partnership or joint venture or other entity, and this Agreement shall continue in full force and effect and shall entitle the
Employee and his heirs, beneficiaries and representatives to exactly the same compensation, benefits, perquisites, payments and
other rights as would have been their entitlement had such combination, consolidation, merger, transfer of assets or formation
of such partnership or joint venture not occurred.

    	6

    	 

    

10.
No Set-off; No Mitigation Required. Except as expressly provided otherwise in this Agreement, the obligation of the Company to
make any payments provided for hereunder and otherwise to perform its obligations hereunder will not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Employee or others. In
no event will the Employee be obligated to seek other employment or take other action by way of mitigation of the amounts payable
to the Employee under any of the provisions of this Agreement, and such amounts will not be reduced (except as otherwise specifically
provided herein) whether or not the Employee obtains other employment.

11.
Section 409A Compliance. This Agreement is intended to comply with Internal Revenue Code Section 409A. Notwithstanding any provision
herein to the contrary, this Agreement shall be interpreted, operated and administered consistent with this intent. In that regard,
any payment described herein that is subject to Code Section 409A shall not be made earlier than six (6) months after the date
of termination to the extent required by Code Section 409A(a)(2)(B)(i); provided that any such payment that is deferred pursuant
to this Section 11 shall be paid in full as soon as possible consistent with this Section 11.

12.
Survival of Obligations. Sections 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15 and 16 shall survive the termination for any reason
of this Agreement (whether such termination is by the Company, by the Employee, upon the expiration of this Agreement or otherwise).

13.
Employee's Representations. The Employee hereby represents and warrants to the Company that (i) the execution, delivery and performance
of this Agreement by the Employee do not and shall not conflict with, breach, violate or cause a default under any material contract,
agreement, instrument, order, judgment or decree to which the Employee is a party or by which he is bound, (ii) the Employee is
not a party to, or bound by, any employment agreement, noncompete agreement or confidentiality agreement with any other person
or entity, and (iii) upon the execution and delivery of this Agreement by the Company, this Agreement shall be the valid and binding
obligation of the Employee, enforceable in accordance with its terms. The Employee hereby acknowledges and represents that he
has consulted with legal counsel regarding his rights and obligations under this Agreement and that he fully understands the terms
and conditions contained herein.

    	7

    	 

    

14.
Company's Representations. The Company hereby represents and warrants to the Employee that (i) the execution, delivery and performance
of this Agreement by the Company do not and shall not conflict with, breach, violate or cause a default under any material contract,
agreement, instrument, order, judgment or decree to which the Company is a party or by which it is bound, and (ii) upon the execution
and delivery of this Agreement by the Employee, this Agreement shall be the valid and binding obligation of the Company, enforceable
in accordance with its terms.

15.
Enforcement. Because the Employee's services are unique and because the Employee has access to confidential information concerning
the Company, the parties hereto agree that money damages shall not be an adequate remedy for any breach of this Agreement. Therefore,
in the event of a breach or threatened breach of this Agreement that cannot be compensated with monetary damages, the Company
may, in addition to other rights and remedies existing in its favor, apply to any court of competent jurisdiction for specific
performance and/or injunctive or other relief in order to enforce, or prevent any violations of, the provisions hereof (without
posting a bond or other security).

16.
Severability. In case any one or more of the provisions or part of a provision contained in this Agreement shall for any reason
be held to be invalid, illegal or unenforceable in any respect in any jurisdiction, such invalidity, illegality or unenforceability
shall be deemed not to affect any other jurisdiction or any other provision or part of a provision of this Agreement, nor shall
such invalidity, illegality or unenforceability affect the validity, legality or enforceability of this Agreement or any provision
or provisions hereof in any other jurisdiction; and this Agreement shall be reformed and construed in such jurisdiction as if
such provision or part of a provision held to be invalid or illegal or unenforceable had never been contained herein and such
provision or part reformed so that it would be valid, legal and enforceable in such jurisdiction to the maximum extent possible.
In furtherance and not in limitation of the foregoing, the Company and the Employee each intend that the covenants contained in
Sections 5 and 6 shall be deemed to be a series of separate covenants. If, in any judicial proceeding, a court shall refuse to
enforce any of such separate covenants, then such unenforceable covenants shall be deemed eliminated from the provisions hereof
for the purpose of such proceedings to the extent necessary to permit the remaining separate covenants to be enforced in such
proceedings. If, in any judicial proceeding, a court shall refuse to enforce any one or more of such separate covenants because
the total time, scope or area thereof is deemed to be excessive or unreasonable, then it is the intent of the parties hereto that
such covenants, which would otherwise be unenforceable due to such excessive or unreasonable period of time, scope or area, be
enforced for such lesser period of time, scope or area as shall be deemed reasonable and not excessive by such court.

    	8

    	 

    

17.
Entire Agreement; Amendment. This Agreement contains the entire agreement between the Company and the Employee with respect to
the subject matter hereof. This Agreement may not be amended, waived, changed, modified or discharged except by an instrument
in writing executed by or on behalf of the party against whom enforcement of any amendment, waiver, change, modification or discharge
is sought. No course of conduct or dealing shall be construed to modify, amend or otherwise affect any of the provisions hereof.

18.
Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been
duly given if physically delivered, delivered by express mail or other expedited service or upon receipt if mailed, postage prepaid,
via registered mail, return receipt requested, addressed as follows:

To
the Company:

FlexShopper,
Inc.

Attention:
Brad Bernstein

2700
N. Military Trail, Suite 200

Boca
Raton, FL 33431

To
the Employee:

Marc
Malaga

c/o
FlexShopper, Inc.

2700
N. Military Trail, Suite 200

Boca
Raton, FL 33431

 

and/or
to such other persons and addresses as any party shall have specified in writing to the other.

19.
Assignability. This Agreement shall not be assignable by either party and shall be binding upon, and shall inure to the benefit
of, the heirs, executors, administrators, legal representatives, successors and assigns of the parties. In the event that all
or substantially all of the business of the Company is sold or transferred, then this Agreement shall be binding on the transferee
of the business of the Company whether or not this Agreement is expressly assigned to the transferee.

20.
Governing Law. This Agreement shall be governed by and construed under the laws of the State of Delaware without regard to conflict
of laws principles.

21.
Waiver and Further Agreement. Any waiver of any breach of any terms or conditions of this Agreement shall not operate as a waiver
of any other breach of such terms or conditions or any other term or condition, nor shall any failure to enforce any provision
hereof operate as a waiver of such provision or of any other provision hereof. Each of the parties hereto agrees to execute all
such further instruments and documents and to take all such further action as the other party may reasonably require in order
to effectuate the terms and purposes of this Agreement.

22.
Headings of No Effect. The Section headings contained in this Agreement are for reference purposes only and shall not in any way
affect the meaning or interpretation of this Agreement.

IN
WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of the date first above written.

COMPANY:

FlexShopper,
Inc.

	By:
/s/	 
	 Name:
Brad Bernstein

Title:
CEO

	 

EMPLOYEE:

	By:
/s/	 
	 Name:
Marc Malaga

Title:
Executive Vice President - Operations

	 

 

9

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