Document:

Blueprint

 

 Exhibit 10.4

 

 CONTRACT SERVICE AGREEMENT

 

This
Service Agreement (“Agreement”) is entered effective
as of the 1st day of October, 2018, between VIVI HOLDINGS, INC., a Delaware
corporation (the “Company”), whose address is 951
Yamato Road, Suite 101, Boca Raton, FL 33431 and Alejandro
Villicana as contracted to Vivi Holdings, Inc., whose address is
listed below his signature (“Contractor”).

 

 

BACKGROUND

 

WHEREAS, the Company desires to hire the
Contractor;

 

WHEREAS, Contractor desires to be hired by
the Company and understands this Agreement and acknowledges that he
has been given a fair opportunity to discuss it with an
attorney.

 

NOW, THEREFORE, in consideration of the
representations, covenants and promises contained in this Agreement
and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and
Contractor, each intending to be legally bound, agree as
follows:

 

TERMS

 

1. Background.
The Background statements set forth above are true and correct and
are incorporated into this Agreement.

 

2. Term of
Service. The Company
hereby employs Contractor as its Chief Controller Officer to
perform the duties described in Section 3 and Contractor hereby
accepts such Service by the Company, on the terms and conditions
herein contained and subject to the policies and procedures adopted
by the Company from time to time, for a term of one year commencing
on October 1, 2018 (the “Term”).

 

3. Duties.

 

A. General Duties. As Chief
Controller Officer of the Company, Contractor will have general
responsibility for the oversight of the accounting and financial
reporting of the Company and such other powers and duties customary
to such position. Contractor shall perform her duties and
obligations hereunder diligently, faithfully and completely, and
with Contractor’s application of her abilities, skills and
judgment and in accordance with ethical and professional standards.
More specifically as described in the Job Description
attached.

 

B. Additional Activities.
Contractor agrees that during the Term
of this Agreement she shall not: (i) engage in other business
activities of any kind which would give rise to a conflict of
interest for Contractor with respect to her duties and obligations
to the Company and under this Agreement, (ii) directly or
indirectly, engage in any activities which may damage the business
of the Company or which may adversely affect the goodwill,
reputation or business relations of the Company with its customers,
the public generally or with any of its other
Contractors.

 

4. Compensation.
The Company shall pay Contractor a base monthly salary of $8,000.00
(the “Compensation”).

 

(a) 

Bonus -
Contractor will be eligible to participate in a bonus program
commensurate with Contractor’s performance and the
profitability of the Company should the Company Board of Directors
implement a bonus program. All determinations of the payment and
amounts of a bonus, if awarded, shall be at the sole discretion of
the Company’s Board of Directors, based upon the
recommendations given to the Board by the managers of the Company.
The Board may amend and change the bonus program at any time in its
sole discretion. In the event the Board of Directors implements a
bonus program, notwithstanding the Contractor will be eligible to
participate, does not mean that any bonus award will necessarily be
granted to Contractor. Any such bonus grant is completely at the
discretion of the Board of Directors.

 

(b) 

Equity Incentive
Plan. Contractor will be eligible to participate in the 2018
Equity Incentive Plan (the “Plan”) should the Company Board of
Directors implement such a plan. All determinations of any award
under the Plan, if awarded, shall be at the sole discretion of the
Company’s Board of Directors. The Board may amend and change
the Plan at any time in its sole discretion. In the event the Board
of Directors implements a Plan, notwithstanding the Contractor will
be eligible to participate, does not mean that any award under the
Plan will necessarily be granted to Contractor. Any such Plan award
is completely at the discretion of the Board of
Directors.

 

5. Benefits.
During the Term, Contractor shall have the ability to participate
in the benefits, adopted by the Company for its Contractors
similarly situated to Contractor, such as health (the
“Benefits”). The
Contractor shall be entitled to take vacation days, and
sick/personal days in each calendar year as determined by Company
policy.

 

 

1

 

 

6. Reimbursement of
Expenses.
During the Term, the Company may
reimburse Contractor for all preapproved ordinary and necessary
business expenses, incurred by him in connection with the
performance of her responsibilities and duties hereunder.
Reimbursement of any such expenses subject to submission by
Contractor to the Company of vouchers itemizing such expenses in a
form satisfactory to the Company, properly identifying the nature,
amount and business purpose of any such expenditure, in accordance
with the then current policies established by the
Manager.

 

7. Termination.

 

A. With Cause. This Agreement may
be terminated by the Company “for cause”, subject to
the cure period as specified below, in any of the following
circumstances:

 

(i) Contractor commits
any act or acts of fraud, misappropriation or
dishonesty;

 

(ii) Contractor
intentionally fails to perform or is negligent in the performance
of her duties or obligations or Contractor violates any provision
of this Agreement, including, but not limited to, the restrictive
covenants;

 

(iii) Contractor
violates any other agreement between the Company and Contractor or
for the benefit of Company or otherwise fails to comply with the
standards, directions, policies and regulations of the
Company;

 

(iv) Contractor
is convicted, pleads guilty to, or pleads no contest to a felony
crime or any crime involving dishonesty, fraud or violence in any
state or federal court within the United States; or

 

(v) Contractor engages
in any illegal or inappropriate activity which, in the sole and
absolute discretion of the Company, is detrimental to the
reputation, goodwill or business operations of the Company or which
reflects adversely upon, or has an adverse impact on, the
Company.

 

The
Company agrees to provide the Contractor with written notice of the
for cause circumstances and provide the Contractor with a cure
period of 20 days to correct the deficiency as noted by the
Company. Should the Contractor fail to cure the for cause
deficiency within said 20 day period, then a termination by the
Company for cause under this Section 7.A shall be effective
immediately after the expiration of the cure period set forth in
the foregoing sentence without further notice to
Contractor.

 

B. Without Cause. The
Contractor’s Term of Service may be terminated by the Company
for any reason or no reason, to be effective upon thirty (30) days prior written notice
given by the Company to Contractor.

C. Event of
Disability.                                            If,
during the Term, Contractor shall be unable to perform the material
parts of Contractor’s duties (a) for a period exceeding
ninety (90) consecutive
calendar days, or (b) for a total of one hundred eighty (180) non-consecutive
calendar days during any period of twelve (12) consecutive months,
by reason of illness or incapacity as determined by a physician
mutually acceptable to the Company and Contractor (either referred
to herein as an “Event of
Disability”), the Contractor’s Term of Service
may be terminated by the Company. A termination by the Company
under this Section
7.A shall be
effective immediately upon the date set forth in a written notice
of termination delivered by the Company to Contractor.

 

D. Death. The Contractor’s
Term of Service shall immediately terminate upon the date of the
death of Contractor.

 

8. The
Party's Rights on Termination.

 

A. No Further Compensation. Upon
termination as set forth in Section 7, Contractor shall not be
entitled to any further compensation or benefits.

 

B. Severance. No severance will be due under this
Agreement.

 

C. Full Settlement. The payments
provided under this Agreement are in full settlement of any claims
Contractor may have against the Company arising out of
Contractor’s termination, including, but not limited to, any
claims for discrimination or wrongful discharge; provided, however,
any rights or obligations of the parties under any other agreement
or plan, such as any pension, stock option, shareholder or other
plan or agreement shall be governed by such other plan or
agreement.

 

9. Contractor's Duty
of Loyalty and Fiduciary Obligations. Contractor has a
fiduciary obligation to the Company, which requires Contractor to
exercise due diligence and good faith in any dealings which may
affect the Company and to always act in the Company's best
interests. During the Term, Contractor shall not engage in any
transaction or other act which could be detrimental to the Company,
beneficial to any of the Company's competitors, or which could
otherwise constitute a conflict of interest. During the Term,
Contractor shall devote Contractor’s efforts and ability on a
full-time basis to the Company. Contractor shall not
“freelance” or otherwise sell any product or perform
any service competitive with any product or service offered by the
Company, on a full time, part time, or any other basis, other than
for the Company. This shall not apply to services performed by
Contractor, without compensation, for any bona fide nonprofit,
charitable, civic, religious, or community organization so long as
such services do not constitute a conflict of interest or violate
other provisions of this Agreement.

 

 

2

 

 

10. Representations of
Contractor. Contractor represents and warrants to the
Company that he is not subject to any restriction or
non-competition covenant in favor of a former employer or any other
person or entity, and that the execution of this Agreement by
Contractor and her provision of
services to the Company and the performance of her obligations
hereunder will not violate or be a breach of any agreement with a
former employer or any other person or entity. Further, Contractor
agrees to indemnify the Company for any claim, including but not
limited to attorneys’ fees and expenses of investigation, by
any such third party that such third party may now have or may
hereafter have against the Company based upon any noncompetition
agreement, invention or secrecy agreement between Contractor and
such third party.

 

11. Covenant Not to
Solicit or Compete.

 

A. No
Solicitation. The Contractor
shall not, during the Service Term and the twenty four (24) month
period following the Service Term (the “Restriction
Period”) directly or
indirectly, solicit, entice, persuade, induce or cause any
Contractor, officer, manager, director, consultant, agent or
independent contractor of the Company to terminate his, her or its
Service, consultancy or other engagement by the Company to become
employed by or engaged by any individual, entity, corporation,
partnership, association, or other organization (collectively,
“Person”) other than the Company, or approach any
such Contractor, officer, manager, director, consultant, agent or
independent contractor for any of the foregoing purposes, or
authorize or assist in the taking of any of such actions by any
Person.

 

B. Prohibited
Actions. The Contractor shall
not, during the Restriction Period, directly or indirectly,
solicit, entice, persuade, induce or cause:

 

1. any
Person who either was a customer of the Company at any time during
the Service Term or is a customer of the Company at any time during
the Restriction Period; or

 

2. any
lessee, vendor or supplier to, or any other Person who had or has a
business relationship with, the Company at any time during the
Service Term or the Restriction Period;

 

(the
Persons referred to in items (i) and (ii) above, collectively, the
“Prohibited
Persons”) to enter into a business relationship with
any other Person for the same or similar services, activities or
goods that any such Prohibited Person purchased from, was engaged
in with or provided to, the Company or to reduce or terminate such
Prohibited Person’s business relationship with the Company;
and the Contractor shall not, directly or indirectly, approach any
such Prohibited Person for any such purpose, or authorize or assist
in the taking of any of such actions by any Person.

 

C. Terms.
For purposes of this Section
11, the terms
“Contractor”, “consultant”,
“agent”, and “independent contractor” shall
include any Persons with such status at any time during the three
(3) months preceding any solicitation in
question.

 

D. Referrals.
Nothing in this Section 11
shall be interpreted as prohibiting
the Contractor from referring business to a consultant, agent,
lessee, vendor or supplier of the Company so long as the
consultancy or other engagement with the Company is not adversely
affected thereby.

 

E. Non-Competition.
Except as otherwise provided in this Agreement, the Contractor
shall not, anywhere within the Restricted
Territory, as hereinafter
defined, directly or indirectly, alone or in association with any
other Person, directly or indirectly, (i) acquire, or own in any
manner, any interest in any Person that engages in the Business or
that engages in any business, activity or enterprise that competes
with any aspect of the Business, or (ii) be interested in (whether
as an owner, director, officer, partner, member, lender,
shareholder, vendor, consultant, Contractor, advisor, agent,
independent contractor or otherwise), or otherwise participate in
the management or operation of, any Person that engages in any
business, activity or enterprise that competes with any aspect of
the Business. For purposes hereof, Restricted Territory shall mean
the World.

 

12. Protection
of Confidential Information.
The Contractor acknowledges that prior to the Service Date the
Contractor has had access to, and during the course of the
Contractor’s Service hereunder will have access to,
significant Confidential Information (defined below). During the
Restriction Period, (i) the Contractor shall maintain all
Confidential Information in strict confidence and shall not
disclose any Confidential Information to any other Person, except
as necessary in connection with the performance of the
Contractor’s duties and obligations under this Agreement, or
as the Contractor may be compelled to disclose by law and (ii) the
Contractor shall not use any Confidential Information for any
purpose whatsoever except in connection with the performance of the
Contractor’s duties and obligations under this
Agreement.

 

For
purposes of this Agreement, “Confidential Information” shall
mean any and all information pertaining to the Company and the
Business, whether such information is in written form or
communicated orally, visually or otherwise, that is proprietary,
non-public or relates to any trade secret, including, but not
limited to, (i) information, observations and data obtained by the
Contractor while employed by the Company concerning the Business,
(ii) products or services, (iii) fees, costs and pricing
structures, (iv) designs, (v) analyses, (vi) drawings, photographs
and reports, (vii) computer software, including operating systems,
applications and program listings, (viii) flow charts, manuals and
documentation, (ix) data bases, (x) accounting and business
methods, (xi) inventions, devices, new developments, methods and
processes, whether patentable or unpatentable and whether or not
reduced to practice, (xii) customers, suppliers, clients and
customer, supplier and client lists, (xiii) other copyrightable
works, (xiv) marketing plans and trade secrets, and (xv) all
similar and related information in whatever form. Notwithstanding
the foregoing, “Confidential Information” shall not
include information that (i) is or becomes generally available to,
or known by, the public through no fault of the Contractor, or (ii)
is independently acquired or developed by the Contractor without
violating any of her
obligations under this Agreement.

 

13. Inventions.
The Contractor shall disclose promptly to the Company any and all
conceptions and ideas for inventions, improvements, and valuable
discoveries, whether patentable or not, which are conceived or made
by the Contractor solely or jointly with another during the period
of Service or within one (1) year thereafter and which are related
to the business or activities of the Company. The Contractor hereby
assigns and agrees to assign all her interest therein to Company or
its nominee. Whenever requested by the Company, the Contractor
shall execute any and all applications, assigns or other
instruments that the Company shall deem necessary to apply for and
obtain Letters of Patents of the United States or any foreign
country or to otherwise protect the Company’s interest
therein. These obligations shall continue beyond termination of
Service with respect to inventions, improvements and valuable
discoveries, whether patentable or not, conceived, made or acquired
by the Contractor during the period of Service or within one year
thereafter, and shall be binding upon the Contractor’s heirs,
assigns, executors, administrators and other legal
representatives.

 

 

3

 

 

14. Return
of Property. All
correspondence, reports, charts, products, records, designs,
patents, plans, manuals, sales and marketing material, memorandum,
advertising materials, customer lists, distributor lists, vendor
lists, telephones, beepers, portable computers, and any other such
data, information or property collected by or delivered to the
Contractor by or on behalf of the Company, their representatives,
customers, suppliers or others and all other materials compiled by
the Contractor which pertain to the business of the Company shall
be and shall remain the property of the Company and shall be
delivered to the Company promptly upon its request at any time and
without respect upon completion or other termination of the
Contractor’s Service hereunder for any
reason.

 

15. Representations
of the Contractor. The
Contractor represents and warrants to the Company that he is not
subject to any restriction or non-competition covenant in favor of
a former employer or any other person or entity, and that the
execution of this Agreement by the Contractor and her provision of
services to the Company and the performance of her obligations
hereunder will not violate or be a breach of any agreement with a
former employer or any other person or entity. Further, the
Contractor agrees to indemnify the Company for any claim, including
but not limited to attorneys’ fees and expenses of
investigation, by any such third party that such third party may
now have or may hereafter have against the Company based upon any
noncompetition agreement, invention or secrecy agreement between
the Contractor and such third party.

 

16. Certain
Additional Agreements.

 

A. Legitimate
Interest. The Contractor agrees
that it is a legitimate interest of the Company and reasonable and
necessary for the protection of the goodwill and business of the
Company, which are valuable to the Company, that the Contractor
make the covenants contained in Sections 11, 12, 13,
14 and 15 (the
“Selected
Covenants”).

 

B. Fair
and Reasonable. The parties
acknowledge that (i) the type and periods of restriction imposed in
the Selected Covenants are fair and reasonable and are reasonably
required to protect and maintain the proprietary and other
legitimate business interests of the Company, as well as the
goodwill associated with the Business conducted by the Company,
(ii) the Business conducted by the Company extends throughout the
United States, and (iii) the time, scope, geographic area and other
provisions of the Selected Covenants have been specifically
negotiated by sophisticated commercial parties represented by
experienced legal counsel.

 

C. Illegality.
In the event that any covenant contained in this Agreement,
including, without limitation, any of the Selected Covenants shall
be determined by any court of competent jurisdiction to be illegal,
invalid or unenforceable by reason of its extending for too great a
period of time or over too great a geographical area or by reason
of its being too extensive in any other respect, (i) such covenant
shall be interpreted to extend over the maximum period of time for
which it may be legal, valid and enforceable, as applicable, and/or
over the maximum geographical area as to which it may be legal,
valid and enforceable, as applicable, and/or to the maximum extent
in all other respects as to which it may be legal, valid and
enforceable, as applicable, all as determined by such court making
such determination, and (ii) in its reduced form, such covenant
shall then be legal, valid and enforceable, as applicable, but such
reduced form of covenant shall only apply with respect to the
operation of such covenant in the particular jurisdiction in or for
which such adjudication is made. It is the intention of the parties
that such covenants shall be enforceable to the maximum extent
permitted by applicable law.

 

17. Specific
Performance. The Contractor
acknowledges that any breach or threatened breach of the covenants
contained in the Selected Covenants will cause the Company material
and irreparable damage, the exact amount of which will be difficult
to ascertain and that the remedies at law for any such breach or
threatened breach will be inadequate. Accordingly, the Contractor
agrees that the Company shall, in addition to all other available
rights and remedies (including, but not limited to, seeking such
damages as either of them can show it has sustained by reason of
such breach), be entitled to specific performance and injunctive
relief in respect of any breach or threatened breach of any of the
Selected Covenants, without being required to post bond or other
security and without having to prove the inadequacy of the
available remedies at law or irreparable harm.

 

A.
Notwithstanding anything to the contrary in this Agreement to the
contrary, in the event the Company is declared to have been in
material default of this Agreement by final arbitration in a forum
selected by the parties or final adjudication in any court, Section
11 of this Agreement shall terminate and not be operative for any
period of time thereafter.

 

18. Survivability of
Provisions. The
provisions of Section
11 through Section
17 of this Agreement shall survive the termination of this
Agreement by either party, and shall apply to any other services
provided by Contractor whether as an independent contractor and/or
through an agency relationship with the Company.

 

19. Jurisdiction,
Venue, Governing Law. Personal jurisdiction over the parties
may be properly exercised, and exclusive venue for any action
arising out of or related to this Agreement shall be in the state
and federal courts of Palm
Beach County, Florida. Florida law shall govern the
validity, construction, enforcement of, and all other matters
relating to this Agreement, including the remedies available for
its breach.

 

20. Severability.
If a court of competent jurisdiction determines that any provision
of this Agreement is too broad or extensive to permit enforcement
to its full extent, then any such provision shall be enforced to
the maximum extent permitted by Florida law. A judicial
determination regarding the invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or
enforceability of the remaining provisions of this Agreement, which
shall continue to be given full force and effect.

 

21. Attorneys'
Fees. In the event of
legal proceedings arising from a breach or threatened breach of
this Agreement, including any of the representations, warranties,
covenants or promises contained in this Agreement, the prevailing
party shall be entitled to recover, in addition to any other
remedy, its fees and costs including, but not limited to fees and
costs of attorneys, investigators, experts and paralegals and costs
pre-litigation, appeal, bankruptcy, and collection.

 

22. Miscellaneous.
This Agreement shall be binding upon and inure to the benefit of
the parties and their respective successors, assigns, and legal
representatives; provided, however, that the rights, duties, and
obligations of Contractor under this Agreement are personal and
cannot be delegated, assigned, or otherwise transferred by
Contractor without the prior written consent of the Company. Any
failure by either party to comply with any provision of this
Agreement may be waived, but only if such waiver is in writing and
signed by the other party. Any failure to insist upon or enforce
compliance with any provision of this Agreement shall not operate
as a waiver of, or estoppel with respect to, any other or
subsequent failure.

 

 

4

 

 

23. Headings/Gender.
Descriptive headings are for convenience only and shall not affect
the meaning or construction of any provision of this Agreement.
Whenever the context of this Agreement shall so require, the
singular shall include the plural, the male gender shall include
the female gender and neuter and vice versa.

 

24. Notices.
Any notice required or permitted to be given under this Agreement
shall be sufficient if in writing and if hand delivered, sent by
Federal Express or comparable overnight carrier, or sent by
registered or certified U.S. Mail, return receipt requested, to
address for the applicable party set at the beginning of this
Agreement.

 

25. Entire
Understanding. This
Agreement constitutes the entire understanding between the parties
with respect to the subject matter of this Agreement and supersedes
any prior or contemporaneous discussions, representations, or
agreements, whether such representations or agreements were oral or
written or express or implied. This Agreement may not be amended or
modified except by a writing signed by both Contractor and the
Company.

 

26. Interpretation.
This Agreement is the result of negotiations between the parties,
who were each given the opportunity to fully review this Agreement
and consult the services and advice of an attorney. This Agreement
shall not be construed more strictly against the Company simply
because it or its attorney was the party responsible for its
preparation. The provisions of this Agreement shall be construed as
an agreement independent of the other terms of Service with the
Company. A breach of any material provision of this Agreement
(including without limitation Section 9 through Section 13 shall be grounds for
immediate dismissal by the Company for cause. The existence of any
claim or cause of action by Contractor against the Company shall
not constitute a defense to the enforcement by the Company of
Section
9 through
Section
13.

 

27. Assignment. The
rights and obligations of the Company under this Agreement shall
inure to the benefit of and be binding upon the successors and
assigns of the Company. The Company may assign its rights and
obligations under this Agreement to any corporation, limited
liability company or other entity which controls, is controlled by,
or is under common control with, the Company, without
Contractor’s consent. In all other circumstances, the rights
and obligations of the Company under this Agreement may be assigned
with Contractor’s consent (which shall not be unreasonably
conditioned, withheld or delayed). Contractor’s obligation to
provide services hereunder may not be assigned to or assumed by any
other person or entity to any extent
whatsoever.

 

28. Counterparts.
This Agreement may be executed in any number of counterparts, each
of which counterpart will be deemed an original and each
counterpart shall be deemed one and the same instrument. An
executed facsimile of this Agreement shall be deemed an
original.

 

29. Waiver
of Jury Trial. Contractor
and Company knowingly, voluntarily and intentionally waive any
right either may have to a trial by jury regarding any litigation
based hereon or arising out of, under or in connection with this
Agreement or any course of conduct, course of dealing, statements
(whether verbal or written), or actions of either party arising
under this Agreement. This provision is a material inducement for
Company entering into this Agreement.

 

[Signature Page Immediately Follows]

 

5

 

HAVING READ THIS AGREEMENT AND INTENDING TO BE LEGALLY BOUND BY ITS
TERMS AND CONDITIONS, THE UNDERSIGNED HAS EXECUTED THIS SERVICE
AGREEMENT EFFECTIVE AS OF THE DATE FIRST SET FORTH
ABOVE.

 

 

VIVI HOLDINGS, INC.

 

 

By:

Eugenio
Santos

Director
of Human Resources

 

 

[Additional Signature Page Immediately Follows]

 

 

 

Signature Page to Service Agreement

 

 

6

 

 

CONTRACTOR REPRESENTS AND WARRANTS TO COMPANY THAT CONTRACTOR HAS
READ THIS AGREEMENT AND HAD A FAIR OPPORTUNITY TO DISCUSS IT WITH
AN ATTORNEY REGARDLESS OF WHETHER CONTRACTOR ACTUALLY DID RETAIN AN
ATTORNEY. UPON A BREACH OF CERTAIN PROVISIONS OF THIS AGREEMENT,
CONTRACTOR UNDERSTANDS THAT THIS AGREEMENT GRANTS COMPANY, AMONG
OTHER THINGS, THE RIGHT TO OBTAIN AN INJUNCTION AGAINST CONTRACTOR,
PLUS RECOVER ITS COSTS AND DAMAGES.

 

HAVING READ THIS AGREEMENT AND INTENDING TO BE LEGALLY BOUND BY ITS
TERMS AND CONDITIONS, THE UNDERSIGNED HAVE EXECUTED THIS AGREEMENT
EFFECTIVE AS OF THE DATE FIRST SET FORTH ABOVE.

 

 

CONTRACTOR:

 

 

____________________________________

Alejandro
Villicana

 

Address:

 

____________________________________

 

____________________________________

 

____________________________________

 

 

 

Signature Page to Service Agreement

 

 

7Exhibit

MITEK SYSTEMS EXECUTIVE BONUS PROGRAM
FISCAL YEAR 2019
Objective
The objective of the Mitek Executive Bonus Program (“the Program”) is to reward executives with an opportunity to earn an annual cash bonus for their contributions to the achievement of corporate goals during the fiscal year. This Program is intended to ensure a competitive total compensation opportunity and to foster a team effort in the attainment of corporate goals.
Program Design
The Program provides for the payment of a cash bonus that is based upon the percentage achievement of the fiscal 2019 annual revenue and non-GAAP net income (“NGNI”) targets set by the Board of Directors (“Board”), as well as individual performance goals.
Chief Executive Officer (CEO), Chief Financial Officer (CFO), Chief Legal Officer (CLO) and non-GM Executive Bonus:
Annual cash bonuses are computed as a percentage of the participant’s annualized salary earned during the 2019 fiscal year.  The bonus targets for the CEO, CFO, CTO, and CLO (General Counsel) are 80%, 60%, 60%, and 50%, respectively, of their respective annualized salaries for the 2019 fiscal year. 
The CEO, CFO, CLO (General Counsel) and all non-GM executives will receive an annual cash bonus based on annual achievement of corporate revenue, corporate non-GAAP net income (“NGNI”) and individual performance goals.  The total cash bonus is comprised of the following components: 
		
	•
	Corporate Revenue Achievement - 60%

		
	•
	NGNI Achievement - 20%

		
	•
	Achievement of Individual MBOs - 20%

General Manager (GM) Bonus
Annual cash bonuses are computed as a percentage of the participant’s annualized salary earned during the 2019 fiscal year.  The bonus target for the General Manager is 50% of his annualized salary for the 2019 fiscal year.
The SVP & GM, Payments will receive a cash bonus based on achievement of certain revenue, corporate non-GAAP net income (“NGNI”), and individual performance goals.  The total cash bonus is comprised of the following components:
		
	•
	Revenue Achievement - 75%

		
	•
	NGNI Achievement - 12.5%

		
	•
	Achievement of Individual MBOs - 12.5%

Performance Targets
Revenue shall be defined as the applicable revenue determined in accordance with generally accepted accounting principles, adjusted for acquisition-related write-downs of revenue or deferred revenue.  NGNI shall be defined as Net Income for the 2019 fiscal year as determined in accordance with generally accepted accounting principles, adjusted for: 1) acquisition-related write-downs of revenue or deferred revenue, and 

2) non-cash, non-recurring or non-operational items including (but not limited to) expenses for the following: acquisition and integration, litigation, stock compensation, depreciation, amortization, asset impairment charges, severance and restructuring.
The Revenue and NGNI performance components of the cash bonus actually earned will increase or decrease on a 2:1 scale dependent upon the level of goal attainment between 80% and 125%; provided that the CEO’s cash bonus shall increase or decrease on a sale of 4:1 for achievement of a component above 100%.  No award is earned below 80% achievement and no additional award is earned for achievement above 125%, and any award made for achievement below 80% is solely at the discretion of the Compensation Committee.  In addition, in the event that NGNI is below 50% of target then no award will be earned regardless of achievement of other metrics (subject to the Board’s discretion to pay awards).
For example, the portion of the cash bonus earned for achieving 80% of the Revenue Plan  would be 60% of that portion of the cash bonus.  At the achievement of 79% or below of the Revenue Plan, no bonus will be earned.  Similarly, at the achievement of 125% of Revenue Plan, the bonus award would be 200% of that portion of the cash bonus for the CEO and 150% for all other executives.  The maximum bonus award that can be earned is 200% for the CEO and 150% of the bonus target percentage for other executives.
Eligibility
In order to be eligible for a bonus award, the participant must be employed by the Company for a minimum of a full  quarter of the fiscal year for which an annual bonus is earned, and be employed at Mitek at the conclusion of the 2019 fiscal year. Each participant will be paid after the close of the books and annual audit at the end of the 2019 fiscal year, and any bonus payable will be calculated pro rata to the number of days of employment with the Company during the 2019 fiscal year.
Limitations
The Program is administered by the Compensation Committee of the Board of Directors.  Final authority and full discretion in all matters pertaining to the development, or amendment of the Program and the granting of any bonus award under the Program rests with the Compensation Committee.
Participation in the Program does not in any way imply a contractual relationship for employment or in any way alter the at-will employment relationship with the Company.

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