Blucora
Annual Report 2018

Plain-text annual report

Table of ContentsUNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549 FORM 10-K(Mark One)ýANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year endedDecember 31, 2018ORoTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 000-25131BLUCORA, INC.(Exact name of registrant as specified in its charter)Delaware 91-1718107(State or other jurisdiction ofincorporation or organization) (IRS EmployerIdentification No.)6333 State Hwy 161, 4th Floor, Irving, Texas 75038(Address of principal executive offices) (Zip code)Registrant’s telephone number, including area code:(972) 870-6400 Securities registered pursuant to Section 12(b) of the Act:Title of each class Name of each exchange on which registeredCommon Stock, par value $0.0001 per share NASDAQ Global Select MarketSecurities registered pursuant to Section 12(g) of the Act: None(Title of Class)Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ý No oIndicate by check mark whether the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No ýIndicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No oIndicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T duringthe preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No oIndicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, tothe best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ýIndicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growthcompany. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.Large accelerated filerýAccelerated fileroNon-accelerated filero Smaller reporting companyo Emerging growth companyo If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financialaccounting standards provided pursuant to Section 13(a) of the Exchange Act. oIndicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No ýThe aggregate market value of the Common Stock held by non-affiliates of the registrant outstanding as of June 30, 2018, based upon the closing price of Common Stock onJune 30, 2018 as reported on the NASDAQ Global Select Market, was $1,736.6 million. Common Stock held by each officer and director (or his or her affiliate) has been excludedbecause such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes.As of February 22, 2019, 48,203,356 shares of the registrant’s Common Stock were outstanding.DOCUMENTS INCORPORATED BY REFERENCEPart III incorporates certain information by reference from the Definitive Proxy Statement to be filed by the registrant in connection with the 2019 Annual Meeting ofStockholders.Table of ContentsTABLE OF CONTENTSPart I PageItem 1.Business4Item 1A.Risk Factors11Item 1B.Unresolved Staff Comments29Item 2.Properties29Item 3.Legal Proceedings29Item 4.Mine Safety Disclosures29 Part II Item 5.Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities30Item 6.Selected Financial Data31Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations32Item 7A.Quantitative and Qualitative Disclosures About Market Risk54Item 8.Financial Statements and Supplementary Data55Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure88Item 9A.Controls and Procedures88Item 9B.Other Information89 Part III Item 10.Directors, Executive Officers and Corporate Governance90Item 11.Executive Compensation90Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters90Item 13.Certain Relationships and Related Transactions, and Director Independence91Item 14.Principal Accounting Fees and Services91 Part IV Item 15.Exhibits, Financial Statement Schedules92Item 16.Form 10-K Summary96 Signatures Trademarks, Trade Names and Service MarksThis report includes some of trademarks, trade names and service marks of Blucora, Inc. (referred to throughout this report as “Blucora,” the "Company","we," "us," or "our"), including Blucora, HD Vest and TaxAct. Each one of these trademarks, trade names or service marks is either (i) our registeredtrademark, (ii) a trademark for which we have a pending application, (iii) a trade name or service mark for which we claim common law rights or (iv) aregistered trademark or application for registration which we have been authorized by a third party to use.Solely for convenience, the trademarks, service marks and trade names included in this report are without the ®, ™ or other applicable symbols, but suchreferences are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of theapplicable licensors to these trademarks, service marks and trade names. This report may also include additional trademarks, service marks and trade namesof others, which are the property of their respective owners. All trademarks, service marks and trade names included in this report are, to our knowledge, theproperty of their respective owners.2Table of ContentsCAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTSThis report contains forward-looking statements that involve risks and uncertainties. The statements in this report that are not purely historical areforward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Words such as “anticipate,” “believe,”“plan,” “expect,” “future,” “intend,” “may,” “will,” “should,” “estimate,” “predict,” “potential,” “continue,” and similar expressions identify forward-looking statements, but the absence of these words does not mean that the statement is not forward-looking. These forward-looking statements include, butare not limited to, statements regarding:•our ability to effectively compete within our industry;•our ability to attract and retain customers, as well as our ability to provide strong customer service;•our future capital requirements and the availability of financing, if necessary;•our ability to meet our current and future debt service obligations, including our ability to maintain compliance with our debt covenants;•our ability to generate strong investment performance for our customers and the impact of the financial markets on our customers’ portfolios;•political and economic conditions and events that directly or indirectly impact the wealth management and tax preparation industries;•our ability to attract and retain productive financial advisors;•our ability to respond to rapid technological changes, including our ability to successfully release new products and services or improve uponexisting products and services;•our expectations concerning the revenues we generate from fees associated with the financial products that we distribute;•our ability to manage leadership and employee transitions;•our ability to comply with regulations applicable to the wealth management and tax preparation industries, including increased costs associatedwith new or changing regulations;•our expectations concerning the benefits that may be derived from our new clearing platform and our investment advisory platform;•risks associated with the use and implementation of information technology and the effect of security breaches, computer viruses and computerhacking attacks;•our ability to comply with laws and regulations regarding privacy and protection of user data;•our ability to maintain our relationships with third party partners, providers, suppliers, vendors, distributors, contractors, financial institutionsand licensing partners;•our beliefs and expectations regarding the seasonality of our business;•risks associated with litigation;•our ability to attract and retain qualified employees;•our assessments and estimates that determine our effective tax rate;•the impact of new or changing tax legislation on our business and our ability to attract and retain customers;•our ability to develop, establish and maintain strong brands;•our ability to protect our intellectual property and the impact of any claim that we have infringed on the intellectual property rights of others; and•our ability to effectively integrate companies or assets that we acquire.Forward-looking statements are subject to known and unknown risks, uncertainties, and other factors that may cause our results, levels of activity,performance, achievements, and prospects to be materially different from those expressed or implied by such forward-looking statements. These risks,uncertainties, and other factors include, among others, those identified under Item 1A, "Risk Factors," and elsewhere in this report. You should not rely onforward-looking statements, which speak only as of the date of this Annual Report on Form 10-K. We do not undertake any obligation to update anyforward-looking statement to reflect new information, events, or circumstances after the date of this Annual Report on Form 10-K or to reflect theoccurrence of unanticipated events, except as required by law.3Table of ContentsPART IITEM 1. BusinessGeneral OverviewBlucora is a Delaware corporation that was founded in 1996, and, through organic growth and strategic acquisitions, we have become a leadingprovider of technology-enabled financial solutions to consumers, small business owners, and tax professionals. Our products and services in wealthmanagement and tax preparation are offered through HDV Holdings, Inc. and its subsidiaries (“HD Vest”) and TaxAct, Inc. and its subsidiary (“TaxAct”),respectively, and help consumers to manage their financial lives.HD Vest provides financial advisors, who serve as independent contractors through HD Vest’s registered broker-dealer, investment adviser and/orinsurance subsidiaries, with an integrated platform that includes a broad variety of brokerage, investment advisory and insurance products to assist in makingeach financial advisor a financial service center for his/her clients. HD Vest generates revenue primarily through securities and insurance commissions,quarterly investment advisory fees based on advisory assets, revenue sharing agreements and other agreements and fees. We regularly review the commissionsand fees we charge for these products and services in light of the evolving regulatory and competitive environment in which we operate and as a result ofchanges in client preferences and needs. We do not offer any proprietary products. As of December 31, 2018, approximately 3,600 advisors with branchoffices in all 50 states utilized our HD Vest platform and supported approximately $42.0 billion of total client assets for almost 350,000 clients.TaxAct provides affordable digital do-it-yourself (“DDIY”) tax preparation solutions for consumers, small business owners and tax professionalsthrough its website www.TaxAct.com. During the year ended December 31, 2018, TaxAct powered approximately 3,700,000 consumer e-files and another1,800,000 e-files through the 21,000 tax professionals who used TaxAct to prepare and file their taxes or those of their clients. TaxAct generates revenueprimarily through its digital service at www.TaxAct.com. TaxAct can be used to file income tax returns in the U.S. federal jurisdiction, various statejurisdictions, and Canada.Our common stock is listed on the NASDAQ Global Select Market under the symbol “BCOR.”Our HistoryBlucora was formed in 1996 under the name InfoSpace, Inc. (“InfoSpace”). Over the next two decades, InfoSpace operated a number of digitalbusinesses in search, directory, online commerce, media, and mobile infrastructure markets. In 2008, InfoSpace began principally focusing on internet searchservices and content (our “Search and Content” business).In January 2012, InfoSpace acquired TaxAct. In connection with this acquisition, InfoSpace changed its name to Blucora, Inc. in June 2012.In August 2013, Blucora acquired Monoprice, Inc. (“Monoprice”), an e-commerce company that sold self-branded electronics and accessories to bothconsumers and businesses (our “E-Commerce” business).In July 2015, Blucora acquired SimpleTax Software Inc. (“SimpleTax”), a provider of digital tax preparation services for individuals in Canada.For further detail on these acquisitions, see "Note 4: Business Combinations" of the Notes to Consolidated Financial Statements in Part II Item 8 of thisreport.In 2015 we acquired HD Vest and announced our plans to focus on the technology-enabled financial solutions market (the "StrategicTransformation"). The Strategic Transformation refers to our transformation into a technology-enabled financial solutions company comprised of TaxActand HD Vest and the divestitures of our Search and Content business and our E-Commerce business in 2016. As part of the Strategic Transformation and "OneCompany" operating model, we relocated our corporate headquarters from Bellevue, Washington to Irving, Texas during 2017.Business OverviewThrough its registered broker-dealer, registered investment adviser, and insurance agency subsidiaries, HD Vest operates the largest U.S. tax-professional-oriented independent broker-dealer, providing wealth management solutions to financial4Table of Contentsadvisors and their clients nationwide (our "Wealth Management" business or the "Wealth Management segment"). HDV Holdings, Inc. is the parentcompany of the Wealth Management business and owns all outstanding shares of HD Vest, Inc., which serves as a holding company for our various financialservices subsidiaries. Those subsidiaries include HD Vest Investment Securities, Inc. (a registered broker-dealer), HD Vest Advisory Services, Inc. (a registeredinvestment adviser), and HD Vest Insurance Agency, LLC (three insurance agencies domiciled in Texas, Massachusetts, and Montana).The Tax Preparation business consists of the operations of TaxAct and provides digital tax preparation solutions for consumers, small business owners,and tax professionals through its website www.TaxAct.com (collectively referred to as the "Tax Preparation business" or the "Tax Preparation segment").We have two reportable segments: the Wealth Management segment, which is comprised of the HD Vest business, and the Tax Preparation segment,which is comprised of the TaxAct business. See "Note 2: Summary of Significant Accounting Policies" of the Notes to Consolidated Financial Statements inPart II Item 8 of this report for additional information on the Wealth Management and Tax Preparation businesses and their revenue. See "Note 3: SegmentInformation and Revenues" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for information regarding revenue, operatingincome, and assets for our Wealth Management and Tax Preparation businesses.Wealth Management BusinessHD Vest was founded to help tax and accounting professionals integrate financial services into their practices. Unlike traditional independent broker-dealers and/or investment advisers whose client relationships are limited to providing investment advice, most HD Vest advisors have long-standing taxadvisory relationships that anchor their wealth management businesses. We believe that tax and accounting professionals, with their existing clientrelationships and in-depth knowledge of their clients’ financial situations, have a competitive advantage and are better positioned than competitors toprovide tailored financial solutions that enable clients to meet their goals. HD Vest primarily recruits independent tax professionals or financial advisors whopartner with established tax practices and offers specialized training and support, which allows them to join the HD Vest platform as independent financialadvisors. HD Vest has designed a learning management system for its advisors with a curriculum that introduces advisors to the investment business andhelps them build their practices. The comprehensive training curriculum is administered through numerous outlets, including an annual three-day nationalsales conference, approximately 600 specialized local training events held annually, and on-demand learning paths.HD Vest's business model provides an open-architecture investment platform and technology tools to help financial advisors identify investmentopportunities for their clients, while the long-standing tax advisory relationships provide a large client base of possible investment clients. This results in anexperienced and stable network of financial advisors, who have multiple revenue-generating options to diversify their earnings sources, and have access toHD Vest's innovative Mentor program and Chapter meetings. HD Vest also has a highly experienced home office team that is focused on solutions tailored tothe advisor's practice. The home office team provides marketing, practice management, insurance and annuity, wealth management, compliance, successionplanning, and other support to our advisors.Tax Preparation BusinessTaxAct, a top-three provider of digital tax preparation solutions, based upon the number of e-files made in 2018, has leveraged its strong brand,comprehensive suite of tax preparation solutions, and proven digital lead generation capabilities to enable the filing of more than 65 million federalconsumer tax returns in the U.S. and Canada since 2000. TaxAct operates as the value player in its market, with a mission to empower people to navigate thecomplexities of tax preparation with ease and accuracy at a fair price.In addition to TaxAct's core offerings, TaxAct offers ancillary services such as refund payment transfer, audit defense, stored value cards, gift cards andretirement investment accounts through HD Vest, as well as presenting customers the option to review and take advantage of personalized tax and potentialfinancial savings opportunities offered through third party product providers. TaxAct also has an established brand and reputation that we believe isattractive to customers.TaxAct had five offerings for consumers for tax year 2017, which is the basis for its 2018 operating results:•A "free" federal and state edition that handled simple returns;•A "basic" offering that offered features for filers with dependents, retirement income, or college expenses;5Table of Contents•A "plus" offering that contained all of the basic offering features in addition to tools to maximize credits and deductions, and enhanced reporting;•A "self-employed" offering for independent contractors and self-employed filers; and•A "premium" offering that contained all of the plus offering features in addition to tools for self-employed individuals to maximize credits anddeductions.For TaxAct's offerings, state returns can be filed for free for free simple filers, or through the separately-sold state edition. TaxAct also had offerings forsmall business owners.TaxAct’s professional tax preparer software allows professional tax preparers to prepare and file individual and business returns for their clients. TaxActoffers flexible pricing and packaging options that help tax professionals save money by paying only for the specific services that they need. In addition, theprofessional tax preparer software includes valuable features that tax professionals count on to maximize their efficiency and productivity, including theoption of entering data directly into tax forms, utilizing a question-and-answer interview method to enter data, or easily toggling between the two data entrymethods.Growth StrategyOur evolving growth strategy for HD Vest and TaxAct includes participating in favorable industry trends and executing growth strategies that webelieve will result in customer and advisor retention and growth beyond that of the broader markets in which we operate. Our approach is grounded on thebelief that the best way to sustainably grow a business is to earn loyalty based on continuously delivering ever-greater value to target customers and clients.Favorable Industry Trends•Wealth Management Industry Trends - We believe that HD Vest is and will be the beneficiary of several positive industry trends, including growthof investable assets driven by baby boomers’ retirement accounts, a continued migration to independent advisor channels, liquidity events and acontinued shift toward household use of fee-based financial advisors.•Tax Preparation Industry Trends - TaxAct participates in the consumer DDIY tax preparation solutions market, which is the fastest growingsegment in the tax preparation industry and is bolstered by a growing millennial population that continues to adopt technology-enabled financialsolutions that drive value and ease in their everyday lives, and we believe that tax simplification will drive digital consumer growth.Executing our Growth Strategies•Accelerate Growth - There are four key objectives of our growth acceleration strategy:The first key objective of our growth acceleration strategy is to capture organic growth opportunities by optimizing our HD Vest advisor successand productivity by:•Prioritizing recruiting, retaining and developing advisors with the highest potential.•Increasing support for our advisors and focusing on those advisors that are in the best position to grow, some of whom have significantgrowth potential.•Focusing on technology and infrastructure upgrades, including leveraging third-party technologies in areas that are not differentiated, andin many cases, are just as good or better than our current solutions.The second key objective of our growth acceleration strategy is to enhance our technology platform through our recently-completed transition toa new clearing firm by:•Focusing on new technological capabilities, like highly-integrated business processing, data aggregation and a new client portal. Our goalis to improve advisor efficiency and productivity, which we expect will grow total client assets.The third key objective of our growth acceleration strategy is to improve end-client penetration by:6Table of Contents•Focusing on opportunities to service more of our advisors’ tax clients with wealth management solutions, and increasing the investableassets of those tax clients that are being serviced by our advisors.The fourth key objective of our growth acceleration strategy is to increase Advisory Assets:•Advisory Assets are more profitable and predictable than brokerage assets. By focusing on the industry-wide trend of shifting assets frombrokerage to advisory, and offering new tools and solutions to our advisors, we aim to help our advisors convert assets to advisory.•Build Tax-Smart Leadership - A key element of our business model across both HD Vest and TaxAct is to leverage tax information to enablecustomers and advisors to better achieve their financial goals and uncover potential opportunities for customers by delivering technology-enabledtax-smart solutions and financial insights.We have an opportunity to leverage more of our HD Vest experience of providing holistic tax-smart strategies and better outcomes for customers.Some examples include our BluPrint financial assessment, our BluVest - tax-optimized offering and our ability to refer to HD Vest advisors forsupport or 360-degree tax-smart wealth management.•Create One Blucora - A key objective of our strategy is to continue to enable efficiencies through shared services and expertise across our HDVest and TaxAct businesses. We believe that building a high-performing organization that attracts, retains, develops and engages the strongesttalent will drive a shared purpose and common culture.•Deliver Results - Our goal is to drive continuous improvement by focusing on specific metrics that drive the organization and continue to meetour stated goals and targets.SeasonalityOur Tax Preparation business is highly seasonal, with a significant portion of our annual revenue for such services earned in the first four months of ourfiscal year. During the third and fourth quarters, the Tax Preparation segment typically reports losses because revenue from the segment is minimal while coreoperating expenses continue. We anticipate that the seasonal nature of that part of the business will continue in the foreseeable future.CompetitionWe face intense competition in all markets in which our businesses operate. Many of our competitors or potential competitors have substantiallygreater financial, technical, and marketing resources, larger customer bases, longer operating histories, more developed infrastructures, greater brandrecognition, better access to vendors, and more established relationships. Our competitors may be able to adopt more aggressive pricing policies, develop andexpand their product and service offerings more rapidly, adapt to new or emerging technologies more quickly, take advantage of acquisitions and otheropportunities more readily, achieve greater economies of scale, and devote greater resources to the marketing and sale of their products and services than wecan. For our businesses to be successful, we must be competitive in the Wealth Management and Tax Preparation markets, as described in more detail below.Wealth Management CompetitionThe wealth management industry is a highly competitive global industry. We and our financial advisors compete directly with a variety of financialinstitutions, including traditional wirehouses, independent broker-dealers, registered investment advisers, asset managers, banks and insurance companies,and direct distributors such as 1st Global and Cetera Financial Specialists, as well as larger broker-dealers such as Raymond James Financial. Mergers andacquisitions have resulted in consolidation in the wealth management industry. As a result, many of our competitors have greater financial resources, broaderand deeper distribution capabilities, and a more comprehensive offering of products and services. We and our financial advisors compete directly with thosecompanies for the provision of products and services to clients, as well as for retention and hiring of financial advisors.We believe that our competitive position in the wealth management industry is a function of our ability to enable our advisors to offer investmentguidance in the context of their clients' tax situations and more specifically to:•offer high-quality portfolio investment options and competitive product pricing;7Table of Contents•offer a differentiated value proposition (in terms of brand recognition, reputation, and financial advisor payouts) that is sufficient to recruit andretain financial advisors;•offer products and technology solutions that are attractive to financial advisors and their clients;•negotiate competitive compensation arrangements with third-parties, including vendors, suppliers, and product sponsors;•ensure the privacy and security of personal client information submitted to our financial advisors;•develop and react to new technology, services, and regulation in the financial services industry; and•put in place a sufficient support and service network required to support our financial advisors and clients.Tax Preparation CompetitionOur TaxAct business operates in a very competitive marketplace. There are many competing software products and digital services. Intuit’s TurboTax,H&R Block's and Credit Karma's DDIY consumer products and services have a significant percentage of the software and digital service market. Our TaxActbusiness must also compete with alternate methods of tax preparation such as storefront tax preparation services, which includes both local tax preparers andlarge chains such as H&R Block, Liberty Tax, Jackson Hewitt and Credit Karma, and it may also be subject to new market entrants who may take some of ourmarket share. Finally, our TaxAct business faces the risk that state or federal taxing agencies will offer software or systems to provide direct access forindividual filers that will reduce the need for TaxAct’s software and services.We believe that our competitive position in the market for tax preparation software and services is a function of our ability to differentiate our brandversus those of competitors by the following:•offering competitive pricing;•continuing to offer reliable, easy-to-use, and accessible software and services that are compelling to consumers;•offering software that is backed by true financial and tax-expertise;•ensuring the privacy and security of user data submitted through our products;•marketing our software and services in a cost-effective way; and•offering ancillary services that are attractive to users.Governmental RegulationBlucora is a publicly traded company that is subject to Securities and Exchange Commission (“SEC”) and NASDAQ Global Select Market rules andregulations regarding public disclosure, financial reporting, internal controls, and corporate governance. Our Wealth Management and Tax Preparationsegments are subject to federal and state government requirements, including regulations related to consumer protection, user privacy, security, pricing,taxation, intellectual property, labor, advertising, broker-dealers, securities, investment advisers, asset management, insurance, listing standards, and productand services quality.Our Wealth Management segment is subject to additional financial industry regulations and supervision, including by the SEC, the Financial IndustryRegulatory Authority (“FINRA”), the Department of Labor (“DOL”), state securities and insurance regulators, and other regulatory authorities. Our WealthManagement subsidiary HD Vest Investment Securities, Inc. is a broker-dealer registered with the SEC, a member of FINRA, and a member of the SecuritiesInvestor Protection Corporation and the Depository Trust & Clearing Corporation. Broker-dealers and their representatives are subject to rules andregulations covering all aspects of the securities business, including sales and trading practices, use and safekeeping of clients’ funds and securities, capitaladequacy, recordkeeping and reporting, the conduct of directors, officers, and employees, and general anti-fraud provisions. Broker-dealers and theirrepresentatives are also regulated by state securities administrators in those jurisdictions where they do business. Compliance with many of the rules andregulations applicable to us involves a number of risks, because rules and regulations frequently change and are subject to varying interpretations, amongother reasons. Regulators make periodic examinations of our broker-dealer operations and review annual, monthly, and other reports on our operations andfinancial condition. Violations of rules and regulations governing a broker-dealer’s actions could result in censure, penalties and fines, the issuance of cease-and-desist orders, the restriction, suspension, or expulsion from the securities industry of such broker-dealer, its representatives or its officers or employees, orother similar adverse consequences.8Table of ContentsOur Wealth Management subsidiary, HD Vest Advisory Services, Inc. is registered with the SEC as an investment adviser and is subject to therequirements of the Investment Advisers Act of 1940, as amended (the “Advisers Act”), and the regulations promulgated thereunder. Such requirements relateto, among other things, fiduciary duties to clients, advisory fees, maintaining an effective compliance program, solicitation arrangements, conflicts ofinterest, advertising, limitations on agency cross and principal transactions between the advisor and advisory clients, recordkeeping and reportingrequirements, disclosure requirements, and general anti-fraud provisions. The SEC periodically examines our investment adviser operations and reviewsannual, monthly, and other reports on our operations and financial condition. The SEC is authorized to institute proceedings and impose sanctions forviolations of the Advisers Act and other federal securities laws, ranging from fines and censure to termination of an investment adviser’s registration.Investment adviser representatives also are subject to certain state securities laws and regulations. Failure to comply with the Advisers Act or other federaland state securities laws and regulations could result in investigations, sanctions, profit disgorgement, fines, or other similar adverse consequences.Our Wealth Management subsidiaries offer certain products and services subject to the Employee Retirement Income Security Act of 1974, as amended(“ERISA”) and Section 4975 of the Internal Revenue Code (the “Code”), and to regulations promulgated under ERISA or the Code, insofar as they provideservices with respect to plan clients, or otherwise deal with plan clients that are subject to ERISA or the Code. ERISA imposes certain duties on persons whoare “fiduciaries” (as defined in Section 3(21) of ERISA) and prohibits certain transactions involving plans subject to ERISA and fiduciaries or other serviceproviders to such plans. Non-compliance with these provisions may expose an ERISA fiduciary or other service provider to liability under ERISA, which mayinclude monetary penalties as well as equitable remedies for the affected plan. Section 4975 of the Code prohibits certain transactions involving plans (asdefined in Section 4975(e)(1), which includes individual retirement accounts and Keogh plans) and service providers, including fiduciaries, to such plans.Section 4975 imposes excise taxes for violations of these prohibitions.On April 18, 2018, the SEC issued draft rulemaking addressing standards of conduct for broker-dealers and disclosure requirements for broker-dealers and investment advisers. As presently drafted, the SEC’s proposed rules would impose a “best interest” standard on broker-dealers and their registeredrepresentatives, as well as a new disclosure form (Form CRS) that both broker-dealers and investment advisers would have to give clients before providingthem investment advice. The SEC’s proposed rules, if adopted in their current form, would heighten the standard of care for broker-dealers when makinginvestment recommendations and would impose disclosure and policy and procedural obligations that could impact the compensation HD Vest and itsrepresentatives receive for selling certain types of products, particularly those (such as mutual funds) that offer different compensation across different shareclasses. The SEC’s proposed rules would also limit our ability to use the terms “advisor” or “adviser” when referring publicly to our registered representativeswho are not also advisory licensed. Based on comments by SEC Commissioners when the proposed rules were first presented, however, we believe that theSEC’s proposed rules may substantially change during the public comment process. In addition, the SEC’s final rules may not be issued for many monthsand, even then, could be the subject of litigation. Accordingly, we cannot predict if and when the SEC will complete any final rulemaking or what thecontours of the final rules will be. However, the SEC’s final rules could result in additional compliance costs, lesser compensation, and managementdistraction, all of which could materially impact our business and operations.Our Tax Preparation segment is subject to federal and state government requirements, including regulations related to the electronic filing of taxreturns, the provision of tax preparer assistance, and the use and disclosure of customer information. We are also required to comply with Federal TradeCommission requirements and a variety of state revenue agency standards. In addition, we offer certain other products and services to small businesses andconsumers, which are also subject to regulatory requirements. As we expand our products and services, both domestically and internationally, we maybecome subject to additional government regulation. Further, regulators may adopt new laws or regulations or their interpretation of existing laws orregulations may differ from ours or expand to cover additional products and services. These increased regulatory requirements could impose higherregulatory compliance costs, limitations on our ability to provide some services in some states or countries, and liabilities that might be incurred throughlawsuits or regulatory penalties.On December 22, 2017, President Trump signed the Tax Cuts and Jobs Act into law, which significantly revised the U.S. tax code. The resultingchanges became effective beginning with our 2018 calendar year financial reporting period. The primary impacts to us included a reduction of the federalcorporate tax rate from 35% to 21% affecting our net deferred tax liabilities, repeal of corporate alternative minimum tax and associated potential refunds ofprior paid taxes, and potential deductible limits of certain executive compensation.We are subject to federal and state laws and government regulations concerning employee safety and health and environmental matters. TheOccupational Safety and Health Administration, the Environmental Protection Agency, and other federal and state agencies have the authority to promulgateregulations that may have an impact on our operations.9Table of ContentsSee the section entitled "Risks Associated With our Businesses" in Part I, Item 1A of this report for additional information regarding governmentalregulation of our business and risks related to such regulation.Privacy and Security of Customer Information and TransactionsWe are also subject to various federal, state and international laws and regulations and to financial institution and healthcare provider requirementsrelating to the privacy and security of the personal information of customers and employees. In addition, we are subject to laws and regulations that apply tothe Internet, behavioral tracking and advertising, mobile applications and messaging, telemarketing, email activities, data hosting and retention, financialand health information, and credit reporting. Additional laws in all of these areas are likely to be passed in the future, which could result in significantlimitations on or changes to the ways in which we can collect, use, host, store, or transmit the personal information and data of our customers or employees,communicate with our customers, and deliver products and services, or may significantly increase our compliance costs. As our business expands to newindustry segments and new uses of data that are regulated for privacy and security, or to countries outside the United States that have strict data protectionslaws, our compliance requirements and costs will increase.Through a privacy policy framework designed to be consistent with globally recognized privacy principles, we comply with United States federal andother country guidelines and practices to help ensure that customers and employees are aware of, and can control, how we use information about them. TheTaxAct.com website and its digital products have been certified by TRUSTe, an independent organization that operates a website and digital product privacycertification program representing industry standard practices to address users’ and regulators’ concerns about online privacy. We also use privacy statementsto provide notice to customers of our privacy practices, as well as provide them the opportunity to furnish instructions with respect to use of their personalinformation. We participate in industry groups whose purpose is to develop or shape industry best practices, and to influence public policy for privacy andsecurity.To address security concerns, we use security safeguards to help protect the systems and the information customers give to us from loss, misuse andunauthorized alteration. Whenever customers transmit sensitive information, such as credit card information or tax return data, through one of our websites orproducts, we use industry standards to encrypt the data as it is transmitted to us. We work to protect our systems from unauthorized internal or external accessusing numerous commercially available computer security products as well as internally developed security procedures and practices.See the section entitled "Risks Associated With our Businesses" in Part I, Item 1A of this report for additional information regarding risks related toprivacy and security of customer information and transactions.Intellectual PropertyOur success depends upon our technology and intellectual property rights. We seek to protect such rights and the value of our corporate brands andreputation through a variety of measures, including: domain name registrations, confidentiality and intellectual property assignment agreements withemployees and third parties, protective contractual provisions, and laws regarding copyrights, trademarks, and trade secrets. We hold multiple registeredtrademarks in the United States and in various foreign countries, and we may apply for additional trademarks as business needs require. We may not besuccessful in obtaining issuance or registration for such applications or in maintaining existing trademarks. In addition, registered marks may not provide uswith any competitive advantages. We may be unable to adequately or cost-effectively protect or enforce our intellectual property rights, and failure to do socould weaken our competitive position and negatively impact our business and financial results. If others claim that our products infringe their intellectualproperty rights, we may be forced to seek expensive licenses, re-engineer our products, engage in expensive and time-consuming litigation, or stop marketingand licensing our products. See the section entitled "Risks Associated With our Businesses" in Part I Item 1A of this report for additional informationregarding protecting and enforcing intellectual property rights by us and third parties against us.EmployeesAs of December 31, 2018, we had 529 full-time employees. There is significant competition for qualified personnel in the industries in which weoperate, particularly for software development and other technical staff. We believe that our future success will depend in part on our continued ability to hireand retain qualified personnel.Company Internet Site and Availability of SEC FilingsOur corporate website is located at www.blucora.com. We make available on that site, as soon as reasonably practicable, our Annual Reports onForm 10-K, Quarterly Reports on Form 10-Q, proxy statements, Current Reports on Form 8-K, other10Table of Contentsreports filed with or furnished to the SEC, as well as any amendments to those filings. Our SEC filings, as well as our Code of Ethics and Conduct and othercorporate governance documents, can be found in the Investor Relations section of our site and are available free of charge. Amendments to our Code ofEthics and Conduct and any grant of a waiver from a provision of the Code of Ethics and Conduct requiring disclosure under applicable Securities andExchange Commission rules will be disclosed on our website. Information on our website is not part of this Annual Report on Form 10-K. In addition, theSEC maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding us and other issuers thatfile electronically with the SEC.ITEM 1A. Risk FactorsOur business and future results may be affected by a number of risks and uncertainties that should be considered carefully. In addition, this reportalso contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in suchforward-looking statements as a result of certain factors, including the risks described below. The occurrence of one or more of the events listed below couldalso have a material adverse effect on the Company’s business, prospects, results of operations, reputation, financial condition, cash flows or ability tocontinue current operations without any direct or indirect impairment or disruption, which is referred to throughout these Risk Factors as a “Material AdverseEffect.”RISKS ASSOCIATED WITH OUR BUSINESSESThe Tax Preparation and Wealth Management markets are very competitive, and failure to effectively compete could result in a Material Adverse Effect.Our Tax Preparation business operates in a very competitive marketplace. There are many competing software products and digital services. Intuit’sTurboTax and H&R Block’s products and services have a significant percentage of the software and digital service market. Our Tax Preparation businessmust also compete with alternate methods of tax preparation, such as storefront tax preparation services, which includes both local tax preparers and largechains such as H&R Block, Liberty Tax, Jackson Hewitt and Credit Karma, and it may also be subject to new market entrants who may take some of ourmarket share. As digital-do-it-yourself tax preparation continues to be characterized by intense competition, including heavy marketing expenditures, price-based competition, and new entrants, maintaining and growing market share becomes more challenging unless brand relevance, customer experience, andfeature/functionality provide meaningful incremental value. If we cannot continue to offer software and services that have quality and ease-of-use that arecompelling to consumers, market the software and services in a cost-effective manner, offer ancillary services that are attractive to users, and develop thesoftware and services at a low enough cost to be able to offer them at a competitive price point, it could result in a Material Adverse Effect.Our Tax Preparation business also faces potential competition from the public sector, where we face the risk of federal and state taxing authoritiesdeveloping software or other systems to facilitate tax return preparation and electronic filing at no charge to taxpayers, which could reduce the need forTaxAct’s software and services. These or similar programs may be introduced or expanded in the future, which may cause us to lose customers and revenue.The Free File Program is currently the sole means by which the U.S. Internal Revenue Service (the “IRS”) offers tax software to taxpayers. The Free FileProgram is a partnership between the IRS and the Free File Alliance, a group of private sector tax preparation companies of which we are a member that hasagreed to offer free electronic tax filing services to taxpayers meeting certain income-based guidelines. As part of the program, the IRS has agreed that it willnot compete with Free File Alliance companies in providing free, digital tax return preparation and filing services to taxpayers. The Free File Program’scontinuation depends on a number of factors, including increasing public awareness of and access to the free program, as well as continued governmentsupport. The IRS’s current agreement with the Free File Alliance is scheduled to expire in October 2021. If the Free File Program is not renewed uponexpiration of the agreement or if the Free File Program is terminated, and the IRS enters the software development and return preparation space, the federalgovernment would be a publicly funded direct competitor of us and the U.S. tax services industry as a whole.The wealth management industry in which our Wealth Management business operates is also highly competitive, and we may not be able tomaintain our customers, financial advisors, distribution network, or the terms on which we provide our products and services. Our Wealth Managementbusiness competes based on a number of factors, including name recognition, service, the quality of investment advice, investment performance, technology,product offerings and features, price, and perceived financial strength. Competitors in the wealth management industry include broker-dealers, banks, assetmanagers, insurers, and other financial institutions. Many of these competitors have greater market share, offer a broader range of11Table of Contentsproducts, and have greater financial resources. In addition, over time, certain sectors of the wealth management industry have become considerably moreconcentrated, as financial institutions involved in a broad range of financial services have been acquired by or merged into other firms. This consolidationcould result in our competitors gaining greater resources, and we may experience pressures on our pricing and market share as a result of these factors and assome of our competitors seek to increase market share by reducing prices. In addition, our Wealth Management business seeks to differentiate itself on thebasis of offering tax-smart investing advice and solutions. There is no guarantee that this differentiation will be meaningful to our customers and potentialcustomers, or that another competitor will not adopt a similar strategy more effectively. In either case, our ability to compete effectively in the market couldbe damaged.Poor service or performance of the financial products we offer or competitive pressures on pricing of such services or products may cause our WealthManagement business customers to withdraw assets on short notice.Customer service and investment performance are important factors in the success of our Wealth Management business. Strong customer service andinvestment performance help increase customer retention and generate sales of products and services. In contrast, poor service or investment performancecould impair our revenues and earnings, as well as our prospects for growth. Customers can terminate their relationships with us or our financial advisors atwill. There can be no assurance as to how future investment performance will compare to that of our competitors, and historical performance is not indicativeof future returns. A decline or perceived decline in investment performance, on an absolute or relative basis, could cause a decline in sales of mutual fundsand other investment products, an increase in redemptions and the termination of asset management relationships. Such actions may reduce our aggregateamount of advisory assets and reduce management fees. Poor investment performance could also adversely affect our ability to expand the distribution of ourproducts through independent financial advisors.In addition, the emergence of new financial products or services from others, or competitive pressures on pricing of such services or products, mayresult in the loss of accounts in our Wealth Management business. We must also monitor the pricing of our services and financial products in relation tocompetitors and periodically may need to adjust commission and fee rates, interest rates on deposits and margin loans, and other fee structures to remaincompetitive. Competition from other financial services firms, such as reduced commissions to attract customers or trading volume, direct-to-investor onlinefinancial services, or higher deposit interest rates to attract customer cash balances, could adversely impact our business. Customers of our WealthManagement business could also reduce the aggregate amount of their assets managed by us or shift their funds to other types of accounts with different ratestructures for any number of reasons, including investment performance, changes in prevailing interest rates, changes in investment preferences, changes inour (or our financial advisors’) reputation in the marketplace, changes in customer management or ownership, loss of key investment management personneland financial market performance. Our customers can withdraw the assets we manage on short notice, making our future customer and revenue baseunpredictable. A reduction in advisory assets and the resulting decrease in revenues and earnings could have a Material Adverse Effect.Changes in domestic and international economic, political and other factors could have a Material Adverse Effect on our business.Our Wealth Management business operates in the United States and global financial markets, and our Tax Preparation business offers tax filingservices in the federal jurisdiction of the United States, various state jurisdictions and Canada. Accordingly, we are affected by United States and globaleconomic and political conditions that directly and indirectly impact a number of factors in the domestic and global financial markets and economies, whichmay be detrimental to our operating results. In addition, because the significant majority of our revenue is earned within the United States, economicconditions in the United States have an even greater impact on us than companies with a more diverse international presence.Domestic and international factors that could affect our business include, but are not limited to, trading levels, investing, origination activity in thesecurities markets, security and underlying asset valuations, the absolute and relative level and volatility of interest and currency rates, real estate values, theactual and perceived quality of issuers and borrowers, the supply of and demand for loans and deposits, United States and foreign government fiscal and taxpolicies, United States and foreign government ability, real or perceived, to avoid defaulting on government securities, inflation, decline and stress orrecession in the United States and global economies generally, terrorism and armed conflicts, and natural disasters such as weather catastrophes andwidespread health emergencies. Furthermore, changes in consumer economic variables, such as the number and size of personal bankruptcy filings, the rate ofunemployment, decreases in property values, certain life events, and the level of consumer confidence and consumer debt, may substantially affect consumerloan levels and credit quality.While United States and global financial markets have, at a macro level, recently experienced growth, uncertainty and potential volatility remain.For instance, on December 6, 2018, the Dow Jones Industrial Average plunged nearly 800 points before recovering rapidly to close the day down 79 points. Aperiod of sustained downturns and/or volatility in the securities markets,12Table of Contentschanges in interest rates by the Federal Reserve, a return to increased credit market dislocations, reductions in the value of real estate, and other negativemarket factors could have a Material Adverse Effect on our business. We could experience a decline in commission revenue from lower trading volumes, adecline in fees from reduced portfolio values of securities managed on behalf of our customers, a reduction in revenue from capital markets and advisorytransactions due to reduced activity, increased credit provisions and charge-offs, losses sustained from our customers’ and market participants’ failure tofulfill their settlement obligations, reduced net interest earnings, and other losses. Periods of reduced revenue and other losses could be accompanied byperiods of reduced profitability because certain of our expenses, including, but not limited to, our interest expense on debt, rent, facilities and salary expensesare fixed and, our ability to reduce them over short time periods is limited.Other more specific trends may also affect our financial condition and results of operations, including, for example: changes in the mix of productspreferred by investors that may cause increases or decreases in our fee revenues associated with such products, depending on whether investors gravitatetowards or away from such products. The timing of such trends, if any, and their potential impact on our financial condition and results of operations arebeyond our control.Challenging economic times and changes to the Federal or various states' tax code (personal and/or corporate), such as the recent changes passedunder the Tax Cuts and Jobs Act, could cause potential new customers not to purchase or to delay purchasing of our products and services, and could causeour existing customers to discontinue purchasing or delay upgrades of our existing products and services, thereby negatively impacting our revenues andfuture financial results. Poor economic conditions and high unemployment have caused, and could in the future cause, a significant decrease in the number oftax returns filed, which may have a significant effect on the number of tax returns we prepare and file. In addition, weakness in the end-user consumer andsmall business markets could negatively affect the cash flow of our distributors and resellers who could, in turn, delay paying their obligations to us, whichcould increase our credit risk exposure and cause delays in our recognition of revenue or future sales to these customers. Any of these events could have aMaterial Adverse Effect. See “We may be negatively impacted by the recently passed Tax Cuts and Jobs Act or by any future changes in tax laws” for adiscussion of additional risks related to changes in the tax code.Each of these factors could impact customer activity in all of our businesses and have a Material Adverse Effect. In addition, these factors may havean impact on our ability to achieve our strategic objectives and to grow our business.If we are unable to attract and retain productive advisors, our financial results will be negatively impacted.Our Wealth Management business derives a large portion of its revenues from commissions and fees generated by its advisors. Our ability to attractand retain productive advisors has contributed significantly to our growth and success. If we fail to attract new advisors or to retain and motivate our currentadvisors, our business may suffer. In addition, the wealth management industry in general is experiencing a decline in the number of younger financialadvisors entering the industry. We are not immune to that industry trend. If we are unable to replace advisors as they retire, or to assist retiring advisors withtransitioning their practices to existing advisors, we could experience a decline in revenue and earnings.The market for productive advisors is highly competitive, and we devote significant resources to attracting and retaining the most qualified advisors.In attracting and retaining advisors, we compete directly with a variety of financial institutions such as wirehouses, regional broker-dealers, banks, insurancecompanies and other independent broker-dealers. Financial industry competitors are increasingly offering guaranteed contracts, upfront payments, andgreater compensation to attract successful financial advisors. These can be important factors in a current advisor’s decision to leave us as well as in aprospective advisor’s decision to join us. If we are not successful in retaining highly qualified advisors, we may not be able to recover the expense involvedin attracting and training these individuals. There can be no assurance that we will be successful in our efforts to attract and retain the advisors needed toachieve our growth objectives.Moreover, the costs associated with successfully attracting and retaining advisors could be significant, and there is no assurance that we willgenerate sufficient revenues from those advisors’ business to offset those costs. Designing and implementing new or modified compensation arrangementsand equity structures to successfully attract and retain advisors is complicated. Changes to these arrangements could themselves cause instability within ourexisting investment teams and negatively impact our financial results and ability to grow.In addition, as some of HD Vest’s advisors grow their advisory assets, they may decide to disassociate from HD Vest to establish their own registeredinvestment advisers (“RIAs”) and take customers and associated assets into those businesses. HD Vest seeks to deter advisors from taking this route bycontinuously evaluating its technology, product offerings, and service, as well as its advisor compensation, fees, and pay-out policies, to ensure that HD Vestis competitive in the market and attractive to successful advisors. We may not be successful in dissuading such advisors from forming their own RIAs, whichcould cause a material volume of customer assets to leave HD Vest’s platform, which would reduce our revenues and could cause a Material Adverse Effect.13Table of ContentsRapid growth may place significant demands on our resources.We have experienced rapid growth since the completion of our Strategic Transformation. Our anticipated future growth will place a substantialdemand on our managerial, operational and financial resources due to:•the need to manage relationships with various strategic partners and other third parties;•the need to maintain levels of service expected by clients and customers;•the pressure to deliver our products and services on a timely basis;•difficulties in hiring and retaining skilled personnel necessary to support our business;•pressures for the continued development of our products and financial and information management systems; and•the possible need to create lines of businesses or departments that do not now exist, and to hire, train, motivate and manage a growing number ofstaff.There can be no assurance that we will be able to effectively achieve or manage any future growth. If we have not made adequate allowances for thecosts and risks associated with this expansion or if our systems, procedures, or controls are not adequate to support our operations, our business could beharmed and we could experience a Material Adverse Effect.Future revenue growth depends upon our ability to adapt to technological change and successfully introduce new and enhanced products and services.The tax preparation and wealth management industries are characterized by rapidly changing technology, evolving industry and security standards,and frequent new product introductions. Our competitors in these industries offer new and enhanced products and services every year. Consequently,customer expectations are constantly changing. We must successfully innovate and develop or offer new products and features to meet evolving customerneeds and demands, while continually updating our technology infrastructure. We must devote significant resources to developing our skills, tools, andcapabilities in order to capitalize on existing and emerging technologies. Our inability to quickly and effectively innovate our products, services, andinfrastructure could result in a Material Adverse Effect.We offer our digital tax preparation products and services through our website and through our mobile app. If our customers don’t deem our websiteor our mobile app user friendly or if they deem our competitors’ website or mobile app more user friendly or better than ours, our market share could decline,which could have a Material Adverse Effect. In addition, we regularly make upgrades to the technology we use for our tax preparation product that areexpected to provide a better user experience and help us to keep existing customers or attract new customers. If our mobile app or the other upgrades we maketo the technology we use in our Tax Preparation business are not successful, it could result in wasted development costs or damage to our brands and marketshare, any of which could have a Material Adverse Effect. We may also encounter problems in connection with our mobile app, and we may need to devotesignificant resources to the creation, support, and maintenance of new user experiences.Our business depends on fees generated from the distribution of financial products and fees earned from management of advisory accounts.A large portion of our revenues are derived from fees generated from the distribution of financial products, such as mutual funds and variableannuities. Changes in the structure or amount of the fees paid by the sponsors of these products could directly affect our revenues, business and financialcondition. In addition, if these products experience losses or increased investor redemptions, we may receive lower fee revenue from the investmentmanagement and distribution services we provide on behalf of the mutual funds and annuities. Should issuers of these products leave the market ordiscontinue offering or paying trail compensation on some or all of their products, our revenues could be negatively impacted. The investment managementfees we are paid may also decline over time due to factors such as increased competition, renegotiation of contracts and the introduction of new, lower-pricedinvestment products and services. Changes in market values or in the fee structure of asset management accounts would affect our revenues, business andfinancial condition. Asset management fees often are primarily comprised of base management and incentive fees, and investment advisers generally areexperiencing advisory fee compression due to intense competition. Management fees are primarily based on advisory assets, which are impacted by netinflow/outflow of customer assets and market values. Below-market investment performance by our funds and portfolio managers could result in a loss ofmanaged accounts and could result in reputational damage that might make it more difficult to attract new customers and thus further impact our businessand financial condition. If we were to experience the loss of managed accounts, our fee revenue would decline. In addition, in periods of declining marketvalues, our advisory assets may also decline, which would negatively impact our fee revenues and could have a Material Adverse Effect.Investors in the pooled vehicles that we advise can redeem their investments in those funds at any time without prior notice, which could adversely affectour earnings.14Table of ContentsInvestors in the mutual funds and some other pooled investment vehicles that we advise may redeem their investments in those funds at any timewithout prior notice, and investors in other types of pooled vehicles we advise may typically redeem their investments on fairly limited or no prior notice,thereby reducing our advisory assets. These investors may redeem their investments for any number of reasons, including general financial market conditions,the absolute or relative investment performance we have achieved, or their own financial condition and requirements. In a declining stock market, the pace ofredemptions could accelerate. Poor investment performance relative to other funds tends to result in decreased purchases and increased redemptions of fundshares.We have had recent senior leadership transitions, and if we are not effective in managing those transitions, our business could be adversely impacted andwe could experience a Material Adverse Effect.We have had recent senior leadership transition in connection with our Strategic Transition and otherwise and have replaced some of our executiveofficers and senior leadership team. While many of our executive officers have relevant industry experience, they are new to our Company. Changes in seniormanagement are inherently disruptive and can be difficult to manage, and efforts to implement any new strategic or operating goals may not succeed in theabsence of a long-term management team. Periods of transition in senior management are often difficult due to cultural differences that may result fromchanges in strategy and style and the time required for new executives to gain detailed operational knowledge. These changes could also cause concerns tothird parties with whom we do business, and may increase the likelihood of turnover of our employees and, in the case of our Wealth Management business,turnover of advisors. If we are not effective in managing these leadership and employee transitions, our business could be adversely impacted and we couldexperience a Material Adverse Effect.Government regulation of our business, including increased regulation or the interpretation of existing laws, rules or regulations, could have a MaterialAdverse Effect.We are subject to federal, state, and local laws and regulations that affect our business, such as financial services, data privacy and securityrequirements, tax, digital content, employment, consumer protection and fraud protection, among others. In addition, there have been significant newregulations and heightened focus by the government on many of the laws and regulations that affect both our Wealth Management and our Tax Preparationbusinesses. As we expand our products and services and revise our business models, we may become subject to additional government regulation or increasedregulatory scrutiny. Regulators may adopt new laws or regulations, or their interpretation of existing laws or regulations may differ from our interpretation orthe laws of other jurisdictions in which we operate. If we are found to not be in compliance with certain laws, rules or regulations, it could have a MaterialAdverse Effect. Increased or new regulatory requirements or changes in the interpretation of existing laws, rules or regulations could, among other things,result in penalties or fines, impose significant limitations on the way we conduct our business, require changes to our business, require certain notifications tocustomers or employees, restrict our use of personal information, cause our customers to cease utilizing our products or services, make our business morecostly, less efficient, or impossible to conduct, require us to modify our current or future products or services in a manner that is detrimental to our businessand result in additional compliance costs, which could have a Material Adverse Effect.The tax preparation industry continues to receive heightened attention from federal and state governments. New legislation, regulation, publicpolicy considerations, changes in the cybersecurity environment, litigation by the government or private entities, or new interpretations of existing laws mayresult in greater oversight of the tax preparation industry, restrict the types of products and services that we can offer or the prices we can charge, or otherwisecause us to change the way we operate our Tax Preparation business or offer our tax preparation products and services. We may not be able to respondquickly to such regulatory, legislative and other developments, and these changes may in turn increase our cost of doing business and limit our revenueopportunities. In addition, if our practices are not consistent with new interpretations of existing laws, rules or regulations, we may become subject tolawsuits, penalties, fines and other liabilities that did not previously apply. We are also required to comply with Federal Trade Commission (the “FTC”)requirements and a variety of state revenue agency standards. Requirements imposed by the FTC or state agencies, including new requirements or theirinterpretation of existing laws, rules or regulations, could be burdensome on our business, cause us to lose market share due to product changes we arerequired to implement or may significantly increase the costs of providing those services to our customers and may prevent us from delivering a qualityproduct to our customers in a timely manner and at an acceptable price, all of which could have a Material Adverse Effect. In addition, in our Tax Preparationbusiness, we generate revenue from certain financial products related to our tax preparation software and services. These products include prepaid debit cardsor gift cards on which a tax filer may receive his or her tax refund and the ability of certain of our users to have the fees for our services deducted from theirtax refund. Any regulation of these products by state or federal governments, or any competing products offered by state and federal tax collection agencies,could materially and adversely impact our revenue from these financial products.15Table of ContentsIn addition, we are subject to laws, regulations, and industry rules relating to the collection, use, and security of user data. We expect regulation inthis area to increase, and our current data protection policies and practices may not be sufficient and thus may require modification. Numerous jurisdictionshave passed, and may in the future pass, new laws related to the use and retention of consumer information, and this area continues to be an area of interest forU.S. federal, state and foreign governmental authorities. These laws may be interpreted and applied inconsistently from jurisdiction to jurisdiction, and ourcurrent data protection policies and practices may not be consistent with all of those interpretations and applications. We have incurred, and may continue toincur, significant expenses to comply with privacy and security standards and protocols imposed by law, regulation, industry standards, and contractualobligations. Failure to comply with laws and regulations that protect user data could harm our reputation and could result in a Material Adverse Effect.Our ability to comply with all applicable laws, rules and regulations and interpretations of such laws, rules and regulations is largely dependent onour establishment and maintenance of compliance, audit, and reporting systems and procedures, as well as our ability to attract and retain qualifiedcompliance, audit, and risk management personnel. While we have adopted systems, policies, and procedures reasonably designed to comply or facilitatecompliance with all applicable laws, rules and regulations and interpretations of such laws, rules and regulations, these systems, policies, and procedures maynot be fully effective. There can be no assurance that we will not be subject to investigations, claims, or other actions or proceedings by regulators or thirdparties with respect to our past or future compliance with applicable laws, rules, and regulations, the outcome of which may have a Material Adverse Effect.If we fail to comply with applicable laws, rules, regulations and guidance, such failure could have a Material Adverse Effect. See “Our WealthManagement business is subject to extensive regulation, and failure to comply with these regulations could have a Material Adverse Effect” for additionalinformation regarding the regulation of our business.Our Wealth Management business is subject to extensive regulation, and failure to comply with these regulations could have a Material Adverse Effect.Our Wealth Management business is heavily regulated by multiple agencies, including the Securities and Exchange Commission (“SEC”), theFinancial Industry Regulatory Authority (“FINRA”), state securities and insurance regulators, and other regulatory authorities. Failure to comply with theseregulators’ laws, rules, and regulations could result in the restriction of the ongoing conduct or growth, or even liquidation of, parts of our business andotherwise cause a Material Adverse Effect. The regulatory environment in which our Wealth Management business operates is continually evolving, and thelevel of financial regulation to which we are subject has generally increased in recent years. Among the most significant regulatory changes affecting ourWealth Management business is the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), which mandates broad changesin the supervision and regulations of the wealth management industry. Regulators implementing the Dodd-Frank Act have adopted, proposed to adopt, andmay in the future adopt regulations that could impact the manner in which we will market HD Vest products and services, manage HD Vest operations, andinteract with regulators. In addition, the Trump Administration has initiated and in some cases completed a broad review of U.S. fiscal laws and regulations. Ifsignificant changes are enacted as a result of this review, they could negatively impact our Wealth Management business and cause a Material AdverseEffect.On April 18, 2018, the SEC issued draft rulemaking addressing standards of conduct for broker-dealers and disclosure requirements for broker-dealers and investment advisers. As presently drafted, the SEC’s proposed rules would impose a “best interest” standard on broker-dealers and their registeredrepresentatives, as well as a new disclosure form (Form CRS) that both broker-dealers and investment advisers would have to give clients before providingthem investment advice. The SEC’s proposed rules, if adopted in their current form, would heighten the standard of care for broker-dealers when makinginvestment recommendations and would impose disclosure and policy and procedural obligations that could impact the compensation HD Vest and itsrepresentatives receive for selling certain types of products, particularly those (such as mutual funds) that offer different compensation across different shareclasses. The SEC’s proposed rules would also limit our ability to use the terms “advisor” or “adviser” when referring publicly to our registered representativeswho are not also advisory licensed. Based on comments by SEC Commissioners when the proposed rules were first presented, however, we believe that theSEC’s proposed rules may substantially change during the public comment process. In addition, the SEC’s final rules may not be issued for many monthsand, even then, could be the subject of litigation. Accordingly, we cannot predict if and when the SEC will complete any final rulemaking or what thecontours of the final rules will be. However, the SEC’s final rules could result in additional compliance costs, lesser compensation, and managementdistraction, all of which could have a Material Adverse Effect.Legislatures and securities regulators in certain states in which we do business have enacted (or have considered enacting) their own standard ofconduct rules for broker-dealers, insurance agents and investment advisers. To date, the States of Nevada, Connecticut, New Jersey and New York have passedlegislation or proposed regulations of this sort. The requirements and scope of these state rules are not uniform. Accordingly, we may have to adopt differentpolicies and procedures in different states, which could create added compliance, supervision and sales costs for our Wealth Management16Table of Contentsbusiness. Should more states enact similar legislation or regulation, it could result in material additional compliance costs and could have a Material AdverseEffect.Our Wealth Management business distributes its products and services through financial advisors who affiliate with us as independent contractors.There can be no assurance that legislative, judicial, or regulatory (including tax) authorities will not introduce proposals or assert interpretations of existingrules and regulations that would change, or at least challenge, the classification of our financial advisors as independent contractors. Although we believe wehave properly classified our advisors as independent contractors, the IRS or other U.S. federal or state authorities or similar authorities may determine that wehave misclassified our advisors as independent contractors for employment tax or other purposes and, as a result, seek additional taxes from us or attempt toimpose fines and penalties, which could have a Material Adverse Effect on our business model, financial condition, and results of operations.In addition, the SEC and FINRA have extensive rules and regulations with respect to capital requirements. As a registered broker-dealer, our WealthManagement business is subject to Rule 15c3-1 (the “Net Capital Rule”) under the Securities Exchange Act of 1934, as amended, and related requirements ofself-regulatory organizations, which specify minimum capital requirements that are intended to ensure the general soundness and liquidity of broker-dealers.As a result of the Net Capital Rule, our ability to withdraw capital from our subsidiaries that comprise our Wealth Management business could be restricted,which in turn could limit our ability to repay debt, redeem or purchase shares of our outstanding stock, or pay dividends, which could have a MaterialAdverse Effect. A large operating loss or charge against net capital could adversely affect our ability to expand or even maintain our present levels ofbusiness.Our Wealth Management business offers products sponsored by third parties, including, but not limited to, mutual funds, insurance, annuities andalternative investments. These products are subject to complex regulations that change frequently. Although we have controls in place to facilitatecompliance with such regulations, there can be no assurance that our interpretation of the regulations will be consistent with various regulators’interpretations, that our procedures will be viewed as adequate by regulatory examiners, or that the operating subsidiaries will be deemed to be in compliancewith regulatory requirements in all material respects. If products sold by our Wealth Management business do not perform as anticipated due to market factorsor otherwise, or if product sponsors become insolvent or are otherwise unable to meet their obligations, this could result in material litigation and regulatoryaction against us. In addition, we could face liabilities for actual or alleged breaches of legal duties to customers with respect to the suitability of the financialproducts we make available in our open architecture product platform or the investment advice of our financial advisors.See “Government regulation of our business, including increased regulation or the interpretation of existing laws, rules or regulations, could havea Material Adverse Effect” for additional information regarding the regulation of our business.The transition of our Wealth Management business to a new clearing platform may negatively impact our operations and our advisors and the customersof our Wealth Management business.During the second half of 2018, our Wealth Management business completed the conversion (the “Conversion”) of our clearing business to FidelityClearing & Custody Solutions (“FCCS”). The Conversion involved significant operational, technological, and logistical effort, since it required all of ourWealth Management business and customer accounts to migrate to FCCS’s clearing platform, together with all of the underlying customer data. While theconversion of client assets is complete, we continue to acclimate our advisors and customers to FCCS’s technology, product offerings, processes andprocedures, which we expect will continue through the first half of 2019.The movement of business to a new clearing firm is an extremely complex and intensive undertaking, and we have committed a significant amountof human, technological, and financial resources to ensure a successful transition. Given the complexity and magnitude of the transition effort, there can beno guarantee that we will not experience unexpected costs, technological failures, incompatibility of systems or policies, or loss of employees, advisors andcustomers, which could have a Material Adverse Effect. In addition, during the Conversion, we experienced delays in responding to service requests from ouradvisors. A recurrence of those delays could result in our advisors becoming unsatisfied and leaving.We may not realize the financial, operational, and customer-experience benefits that we project over the life of our clearing contract with FCCS. Ourcash sweep program under the new clearing firm is a significant component of the anticipated financial benefits of the Conversion. The cash sweep program issubject to interest rate volatility. Should the Federal Reserve not increase interest rates at the pace or to the levels anticipated, we would likely recognizelower revenue from the cash sweep program than expected, potentially in a material amount. In addition, our customers may choose to reduce the amount ofcash in their accounts, which would reduce the amount of cash in our sweep program. This would reduce our revenue from the cash sweep program,potentially in a material amount. In addition, as part of the Conversion, we plan to implement policies and pricing intended to encourage the conversion ofdirect-to-fund assets onto FCCS’s clearing platform, but we may not realize the level of conversion of such assets onto FCCS’s clearing platform that weanticipate. Should the17Table of Contentsnumber of direct-to-fund assets that convert to FCCS’s platform over the life of our agreement with FCCS fall short of expectations, we will likely receive lesseconomic benefit from the new clearing arrangement than we expected, which could be material.The technology, service and product offerings presented by FCCS may not be accepted by our advisors or customers at the levels we anticipate, andmay not provide the level of benefits that we expect even if accepted. If a significant number of our advisors or customers are or become dissatisfied by thedifferent technology, systems, processes, policies and products that FCCS offers and they leave it could have a Material Adverse Effect.In addition, our Wealth Management business is dependent on the performance, liquidity and continuity of its clearing firm. Should FCCS fail toprovide clearing services at the contracted levels for any reason or suffer a liquidity event, or if FCCS significantly changes the products and services it offers,it could result in a Material Adverse Effect.Simultaneously with the conversion to FCCS, we initiated transition to a new investment advisory platform offered by Envestnet AssetManagement, Inc. (“Envestnet”). The Envestnet platform is comprehensive and its implementation will substantially change how our Wealth Managementbusiness and its Advisors conduct advisory business. Like the clearing firm conversion, implementation of the Envestnet platform was complex and entailedsignificant effort and commitment from our employees and contractors. While implementation of the Envestnet platform is complete, we continue to enhancethe platform to conform to our expectations and to acclimate our staff and advisors to the new platform’s workflows, capabilities and procedures. If we areunable to fully integrate the Envestnet platform with our other systems, this could have a Material Adverse Effect. Similarly, if a significant number of ouradvisors are or become dissatisfied by the transition to the new Envestnet platform, or by the different technology, systems, processes, and policies it offers,they could leave our Wealth Management business, which could have a Material Adverse Effect.Our operating systems and network infrastructure are subject to significant and constantly evolving cybersecurity and other technological risks, and thesecurity measures that we have implemented to secure confidential and personal information may be breached; a potential breach may pose risks to theuninterrupted operation of our systems, expose us to mitigation costs, litigation, investigation, fines and penalties by authorities, claims by persons whoseinformation was disclosed, and damage to our reputation.We collect and retain certain sensitive personal data. Our Tax Preparation and Wealth Management businesses collect, use, and retain large amountsof confidential personal and financial information from their customers, including information regarding income, assets, family members, credit cards, taxreturns, login credentials and passwords, bank accounts, social security numbers, and healthcare. Maintaining the integrity of our systems and networks iscritical to the success of our business operations, including the retention of our customers and advisors, and to the protection of our proprietary informationand our customers' personal information. A major breach of our systems or those of our third-party service providers or partners may have materially negativeconsequences for our businesses, including possible fines, penalties and damages, reduced demand for our services, harm to our reputation and brands, furtherregulation and oversight by federal or state agencies, and loss of our ability to provide financial transaction services or accept and process customer creditcard orders or tax returns. We may detect, or we may receive notices from customers or public or private agencies that they have detected, vulnerabilities inour servers or our software. The existence of vulnerabilities, even if they do not result in a security breach, may harm customer confidence and requiresubstantial resources to address, and we may not be able to discover or remediate such security vulnerabilities before they are exploited.In addition, hackers may develop and deploy viruses, worms, and other malicious software programs that can be used to attack our offerings.Although we utilize network and application security measures, internal controls, and physical security procedures to safeguard our systems, there can be noassurance that a security breach, intrusion, or loss or theft of personal information will not occur. Any such incident could cause a Material Adverse Effectand require us to expend significant resources to address these problems, including notification under data privacy regulations. In addition, our employees(including temporary and seasonal employees) and contractors may have access to sensitive and personal information of our customers and employees. Whilewe conduct background checks on our employees and contractors and limit access to systems and data, it is possible that one or more of these individualsmay circumvent these controls, resulting in a security breach.It is also possible that unauthorized access to or disclosure of customer data may occur due to inadequate use of security controls by our customers.Accounts created with weak or recycled passwords could allow cyberattackers to gain access to customer data. Unauthorized persons could gain access tocustomer accounts if customers do not maintain effective access controls of their systems and software. Further, our customers may choose to use the sameuser ID and password across multiple products and services unrelated to our products. Such customers’ login credentials may be stolen from products offeredby third-party service providers unrelated to us and the stolen identity information may be used by a malicious third party to access our products, whichcould result in disclosure of confidential information.18Table of ContentsWe rely on third-party vendors to host certain of our sensitive and personal information and data through cloud services. While we conduct duediligence on these third-party partners with respect to their security and business controls, we may not have the ability to effectively monitor or oversee theimplementation of these control measures, and, in any event, individuals or third parties may be able to circumvent and/or exploit vulnerabilities that mayexist in these security and business controls, resulting in a loss of sensitive and personal customer or employee information and data.While we maintain cyber liability insurance that provides both third-party liability and first-party liability coverages, this insurance is subject toexclusions and may not be sufficient to protect us against all losses. In addition, the trend toward broad consumer and general public notification of suchincidents could exacerbate the harm to our business, financial condition, or results of operations. Even if we successfully protect our technologyinfrastructure and the confidentiality of sensitive data, we may incur significant expenses in connection with our responses to any such attacks as well as theadoption, implementation, and maintenance of appropriate security measures. We could also suffer harm to our business and reputation if attempted securitybreaches are publicized. We cannot be certain that advances in criminal capabilities, discovery of new vulnerabilities, attempts to exploit vulnerabilities inour systems, data thefts, physical system or network break-ins, inappropriate access, or other developments will not compromise or breach the technology orother security measures protecting the networks and systems used in connection with our businesses.Concerns about the current privacy and cybersecurity environment, generally, could deter current and potential customers from adopting our products andservices and damage our reputation.The continued occurrence of cyberattacks and data breaches on governments, businesses and consumers in general, indicates that we operate in anexternal environment where cyberattacks and data breaches are becoming increasingly common. If the global cybersecurity environment worsens, and thereare increased instances of security breaches of third-party offerings where consumers’ data and sensitive information is compromised, consumers may be lesswilling to use online offerings, particularly offerings like ours in which customers often share sensitive financial data. In addition, the increased availabilityof data obtained as a result of breaches of third-party offerings could make our own products more vulnerable to fraudulent activity. Even if our products arenot affected directly by such incidents, they could damage our reputation and deter current and potential customers from adopting our products and servicesor lead customers to cease using online and connected software products to transact financial business altogether.In addition, we currently plan to increase our capture and use of user data for marketing purposes. In connection with our use of user data formarketing efforts, concerns may be expressed about whether our products, services, or processes compromise the privacy of users, customers and others.Concerns about our practices with regard to the collection, use, disclosure or security of personal information or other privacy related matters, even ifunfounded, could damage the reputation of our business and our brands and adversely affect our operating results.Stolen identity refund fraud could impede our Tax Preparation customers’ ability to timely and successfully file their tax returns and receive their taxrefunds, and could diminish customers’ perceptions of the security and reliability of our tax preparation products and services, resulting in negativepublicity. Increased governmental regulation to attempt to combat that fraud could result in a Material Adverse Effect.Criminals may utilize stolen information obtained through hacking, phishing, and other means of identity theft in order to electronically filefraudulent federal and state tax returns. As a result, impacted taxpayers must complete additional forms and go through additional steps in order to report toappropriate authorities that their identities have been stolen and their tax returns were filed fraudulently. Though we offer assistance in the refund recoveryprocess, stolen identity refund fraud could impede our customers’ ability to timely and successfully file their returns and receive their tax refunds, and coulddiminish customers’ perceptions of the security and reliability of our tax preparation products and services, resulting in negative publicity, despite therehaving been no breach in the security of our systems. In addition, if stolen identity refund fraud is perpetrated at a material level through our tax preparationproducts or services, state, federal, or foreign tax authorities may refuse to allow us to continue to process our customers’ tax returns electronically. As aresult, stolen identity fraud could have a Material Adverse Effect on our Tax Preparation business.Federal, state, and foreign governmental authorities in jurisdictions in which we operate have taken action, and may take action in the future, in anattempt to combat stolen identity refund fraud, which may require changes to our systems and business practices in ways we cannot anticipate. These actionsmay have a Material Adverse Effect on our Tax Preparation business.Complex and evolving U.S. and international laws and regulation regarding privacy and data protection could result in claims, changes to our businesspractices, penalties, increased cost of operations or otherwise harm our business.19Table of ContentsRegulation related to the provision of online services is evolving as federal, state and foreign governments continue to adopt new, or modifyexisting, laws and regulations addressing data privacy and the collection, processing, storage, transfer and use of data. This includes, for example, theEuropean Union’s new regulation, the General Data Protection Regulation, which went into effect on May 25, 2018, and the new California ConsumerProtection Act, which will become effective on January 1, 2020. If we are unable to engineer products that meet these evolving requirements or help ourcustomers meet their obligations under these or other new data regulations, we might experience reduced demand for our offerings. Further, penalties for non-compliance with these laws may be significant.Other governmental authorities throughout the U.S. and around the world are considering similar types of legislative and regulatory proposalsconcerning data protection. Each of these privacy, security and data protection laws and regulations could impose significant limitations, require changes toour business, require notification to customers or workers of a security breach, restrict our use or storage of personal information, or cause changes in customerpurchasing behavior, which may make our business more costly, less efficient or impossible to conduct, and may require us to modify our current or futureproducts or services, which may make customers less likely to purchase our products and may harm our future financial results. Additionally, any actual oralleged noncompliance with these laws and regulations could result in negative publicity and subject us to investigations, claims or other remedies,including demands that we modify or cease existing business practices, and expose us to significant fines, penalties and other damages. We have incurred,and may continue to incur, significant expenses to comply with existing privacy and security standards and protocols imposed by law, regulation, industrystandards or contractual obligations.If we are unable to develop, manage, and maintain critical third-party business relationships for our Tax Preparation and Wealth Managementbusinesses, it could result in a Material Adverse Effect.Our Tax Preparation and Wealth Management businesses are dependent on the strength of our business relationships and our ability to continue todevelop, maintain, and leverage new and existing relationships. We rely on various third-party partners, including software and service providers, suppliers,vendors, distributors, contractors, financial institutions, and licensing partners, among others, in many areas of these businesses to deliver our services andproducts. In certain instances, the products or services provided through these third-party relationships may be difficult to replace or substitute, depending onthe level of integration of the third party’s products or services into, or with, our offerings and/or the general availability of such third party’s products andservices. In addition, there may be few or no alternative third-party providers or vendors in the market. The failure of third parties to provide acceptable andhigh-quality products, services, and technologies or to update their products, services, and technologies may result in a disruption to our business operations,which may materially reduce our revenues and profits, cause us to lose customers, and damage our reputation. Alternative arrangements and services may notbe available to us on commercially reasonable terms or we may experience business interruptions upon a transition to an alternative partner. Our Wealth Management business does not offer any proprietary financial products. Instead, it distributes investment and insurance productsthrough distribution agreements with third-party financial institutions, including banks, mutual funds, and insurance companies. These products are sold byour advisors, who are independent contractors. Maintaining and deepening relationships with these unaffiliated distributors and advisors is an important partof our growth strategy because strong third-party distribution arrangements enhance our ability to market our products and increase our advisory assets,revenues, and profitability. There can be no assurance that the distribution and advisor relationships we have established will continue, or that they willcontinue under existing terms. Our distribution partners and advisors may cease to operate, consolidate, institute cost-cutting efforts, discontinue productsales or compensation streams, or otherwise terminate their relationship with us. Any such reduction in access to third-party distributors and advisors mayhave a material adverse effect on our ability to market our products and to generate revenue in our Wealth Management segment. In addition, there are risksassociated with our third-party clearing firm that we rely on to provide clearing services for our Wealth Management business that are discussed above.Access to investment and insurance product distribution channels is subject to intense competition due to the large number of competitors andproducts in the broker-dealer, investment advisory and insurance industries. Relationships with distributors are subject to periodic negotiation that mayresult in increased distribution costs and/or reductions in the amount of revenue we realize based on sales of particular products or customer assets. Inaddition, regulatory changes (such as the SEC’s proposed “best interest” standard) may negatively impact our revenues and profits related to particularproducts or services. Any increase in the costs to distribute our products or reduction in the type or amount of products made available for sale, or revenueassociated with those products, could have a Material Adverse Effect.The seasonality of our Tax Preparation business requires a precise development and release schedule and any delays or issues with accuracy or qualitymay damage our reputation and could result in a Material Adverse Effect.20Table of ContentsOur tax preparation software and online service must be ready to launch in final form near the beginning of each calendar year to take advantage ofthe full tax season. We must update the code for our software and service on a precise schedule each year to account for annual changes in tax laws andregulations and ensure that the software and service are accurate. Delayed and unpredictable changes to federal and state tax laws and regulations can causean already tight development cycle to become even more challenging. If we are unable to meet this precise schedule and we launch our software and servicelate, we risk losing customers to our competitors. If we cannot develop our software with a high degree of accuracy and quality, we risk errors in the taxreturns that are generated. Such errors could result in loss of reputation, lower customer retention, or legal claims, fees, and payouts related to the warranty onour software and service, which could result in a Material Adverse Effect.The specialized and highly seasonal nature of our Tax Preparation business presents financial risks and operational challenges, which, if not satisfactorilyaddressed, could result in a Material Adverse Effect.Our Tax Preparation business is highly seasonal, with a significant portion of our annual revenue for such services earned in the first four months ofour fiscal year. The concentration of our revenue-generating activity during this relatively short period presents a number of challenges for us, including cashand resource management during the last eight months of our fiscal year, when our Tax Preparation business generally operates at a loss and incurs fixed costsof preparing for the upcoming tax season, responding to changes in competitive conditions, including marketing, pricing, and new product offerings, whichcould affect our position during the tax season, and ensuring optimal uninterrupted operations and service delivery during the tax season. If we experiencesignificant business disruptions during the tax season or if we are unable to satisfactorily address the challenges described above and related challengesassociated with a seasonal business, it could result in a Material Adverse Effect.If our Tax Preparation business fails to process transactions effectively or fails to adequately protect against disputed or potential fraudulent activities, itcould have a Material Adverse Effect.Our Tax Preparation business processes a significant volume and dollar value of transactions on a daily basis, particularly during tax season. Due tothe size and volume of transactions that we handle, effective processing systems and controls are essential to ensure that transactions are handledappropriately. Despite our efforts, it is possible that we may make errors or that fraudulent activity may affect our services. In addition to any direct damagesand fines that may result from any such problems, which may be substantial, a loss of confidence in our controls may materially harm our business anddamage our brand. The systems supporting our Tax Preparation business are comprised of multiple technology platforms, some of which are difficult to scale.If we are unable to effectively manage our systems and processes, we may be unable to process customer data in an accurate, reliable, and timely manner,which could result in a Material Adverse Effect.The United States government’s inability to agree on a federal budget may adversely impact our operations and financial results.In the past, the failure of the United States government to timely complete its budget process has resulted in shutdowns of the federal government,including most recently a shutdown that began on December 22, 2018 and lasted until January 25, 2019. During these shutdowns, certain regulatoryagencies, such as the Internal Revenue Service and the United States Department of the Treasury, have had to furlough critical employees and cease certaincritical activities.During a prolonged government shutdown, the ability of the Internal Revenue Service to timely review and process tax return filings may besignificantly delayed, and representatives of the Internal Revenue Service may be unable to answer crucial taxpayer questions. Even after the shutdown hasended, the Internal Revenue Service may be significantly delayed in processing tax return filings as a result of accumulating a backlog of filings during theshutdown. These may be further exacerbated in years where there are significant changes to existing tax legislation, such as the application of the TaxLegislation to tax return filings related to the 2018 tax year. Any uncertainty surrounding the ability of the Internal Revenue Service to process tax returnfilings and respond to taxpayer questions could cause our customers not to purchase or to delay purchasing our products and services, thereby negativelyimpacting our revenues and future financial results, which could result in a Material Adverse Effect.Our website and transaction management software, data center systems, or the systems of third-party co-location facilities and cloud service providerscould fail or become unavailable or otherwise be inadequate, which could materially harm our reputation and/or result in a material loss of revenues andcurrent or potential customers and have a Material Adverse Effect.Any system interruptions that result in the unavailability or unreliability of our websites, transaction processing systems, or network infrastructurecould materially reduce our revenue and impair our ability to properly process transactions. We use both internally developed and third-party systems,including cloud computing and storage systems, for our online21Table of Contentsservices and certain aspects of transaction processing. Some of our systems are relatively new, and we have some systems that may need updating, whichcould cause them to be subject to failure or unreliability. Any system unavailability or unreliability may cause unanticipated system disruptions, slowerresponse times, degradation in customer satisfaction, additional expense, or delays in reporting accurate financial information. For example, we have beenmigrating data to the cloud. This migration has been costly and has diverted some of management’s attention and resources in order to ensure a smoothtransition to the cloud.Our data centers and cloud service could be susceptible to damage or disruption, which could have a Material Adverse Effect. Our Tax Preparationand Wealth Management businesses have business continuity plans that include secondary disaster recovery centers, but if their primary data centers fail andthose disaster recovery centers do not fully restore the failed environments, our business could suffer. In particular, if such interruption occurs during the taxseason, it could have a Material Adverse Effect on our Tax Preparation business.We regularly invest resources to update and improve our internal information technology systems and software platforms. If we experienceprolonged delays or unforeseen difficulties in updating and upgrading our systems and architecture, we may experience outages and may not be able todeliver certain offerings and develop new offerings and enhancements that we need to remain competitive. Such improvements and upgrades are oftencomplex, costly and time consuming. In addition, such improvements can be challenging to integrate with our existing technology systems, or may uncoverproblems with our existing technology systems. Unsuccessful implementation of hardware or software updates and improvements could result in outages,disruption in our business operations, loss of revenue or damage to our reputation.Our systems and operations, and those of our third-party service providers and partners, could be damaged or interrupted by fire, flood, earthquakes,other natural disasters, power loss, telecommunications failure, internet breakdown, break-in, human error, software bugs, hardware failures, malicious attacks,computer viruses, computer denial of service attacks, terrorist attacks, or other events beyond our control. Such damage or interruption may affect internaland external systems that we rely upon to provide our services, take and fulfill customer orders, handle customer service requests, and host other products andservices. During the period in which services are unavailable, we could be unable or severely limited in our ability to generate revenues, and we may also beexposed to liability from those third parties to whom we provide services. We could face significant losses as a result of these events, and our businessinterruption insurance may not be adequate to compensate us for all potential losses, which could result in a Material Adverse Effect.Current and future litigation or regulatory proceedings or adverse court interpretations of the laws under which the Company operates could have aMaterial Adverse Effect.Many aspects of our business involve substantial risks of liability. We are currently subject to lawsuits and are likely to be subject to litigation inthe future. In highly volatile markets, the volume of claims and amount of damages sought in litigation and regulatory proceedings against financialinstitutions have historically increased. Any lawsuits to which we are subject, such as purported class actions, shareholder derivative lawsuits or claims bywealth management customers, could result in substantial expenditures, generate adverse publicity and could significantly impair our business, or force us tocease offering certain products or services. Defense of any lawsuit, even if successful, could require substantial time and attention of our management andcould require the expenditure of significant amounts for legal fees and other related costs. In addition, litigation or regulatory proceedings or actions broughtby state or federal agencies relating to our products or services may result in additional restrictions on the offering of certain of our products or services. Tothe extent that any such additional restrictions or legal claims limit our ability to offer such products or services, it could result in a Material Adverse Effect.If we are unable to hire, retain, and motivate highly qualified employees, including our key employees, we may not be able to successfully manage ourbusinesses.Our future success depends on our ability to identify, attract, hire, retain, and motivate highly skilled management, technical, sales and marketing,and corporate development personnel, including personnel with experience and expertise in the wealth management, tax preparation, and technologyindustries to support our new strategic focus. Qualified personnel with experience relevant to our businesses are scarce, and competition to recruit them isintense. If we fail to successfully hire and retain a sufficient number of highly qualified employees, we may have difficulties in supporting or expanding ourbusinesses. Realignments of resources, reductions in workforce, or other operational decisions have created and could continue to create an unstable workenvironment and may have a negative effect on our ability to hire, retain, and motivate employees.Our business and operations are substantially dependent on the performance of our key employees. Changes of management or key employees maydisrupt operations, which may materially and adversely affect our business and financial results or delay achievement of our business objectives. In addition,if we lose the services of one or more key employees and are unable to recruit and retain a suitable successor with relevant experience, we may not be able tosuccessfully and timely manage our business or achieve our business objectives. There can be no assurance that any retention program we initiate will besuccessful at retaining employees, including key employees.22Table of ContentsWe use stock options, restricted stock units, and other equity-based awards to recruit and retain senior-level employees. With respect to thoseemployees to whom we issue such equity-based awards, we face a significant challenge in retaining them if the value of equity-based awards in the aggregateor individually is either not deemed by the employee to be substantial enough or deemed so substantial that the employee leaves after their equity-basedawards vest. If our stock price does not increase significantly above the exercise prices of our options, we may need to issue new equity-based awards in orderto motivate and retain our key employees. We may undertake or seek stockholder approval to undertake other equity-based programs to retain ouremployees, which may be viewed as dilutive to our existing stockholders or may increase our compensation costs. There can be no assurance that any suchprograms, if approved by our stockholders, or any other incentive programs, would be successful in motivating and retaining our employees.We may be negatively impacted by the recently passed Tax Cuts and Jobs Act or by any future changes in tax laws.On December 22, 2017, President Trump signed the Tax Cuts and Jobs Act into law. It is difficult to know at this time how our customers will viewthe new federal tax laws that were enacted in late 2017 because 2019 will be the first tax season where these laws are in effect. Possible outcomes include ashort-term or long-term increase in customers that prefer professional tax advice and preparation services rather than using our software or we may see achange in our how customers value our software services as customers may perceive their tax preparation has become simpler as a result of the new tax laws,which could result in lower demand for our products and could reduce revenue and/or the number of units sold.Changes in state and federal tax laws require updates to our tax preparation software used in our Tax Preparation business. Such updates are costlyand may be time consuming to ensure that they accurately reflect the new laws that are adopted. In addition, further changes in the way that state and federalgovernments structure their taxation regimes could also cause a Material Adverse Effect on our Tax Preparation business. The introduction of a simplified orflattened federal or state taxation structure may make our services less necessary or attractive to individual filers, which could reduce revenue and the numberof units sold. We also face risk from the possibility of increased complexity in taxation structures, which may encourage some of our customers to seekprofessional tax advice instead of using our software or services. In the event that such changes to tax structures cause us to lose market share or cause adecline in customers, it could cause a Material Adverse Effect.Our risk management and conflicts of interest policies and procedures may be ineffective or leave us exposed to unidentified or unanticipated risks.We are subject to the risks of errors and misconduct by our employees and financial advisors, such as fraud, non-compliance with policies,recommending transactions that are not suitable, and improperly using or disclosing confidential information. Although we have internal controls and otherrisk-mitigating factors in place, this type of conduct is difficult to detect and deter, and could materially harm our business, results of operations or financialcondition. We are further subject to the risk of nonperformance or inadequate performance of contractual obligations by third-party vendors of products andservices that are used in our businesses. Management of operational, legal and regulatory risks requires, among other things, policies and procedures to recordproperly and verify a large number of transactions and events, and these policies and procedures may not be fully effective in mitigating our risk exposure inall market environments or against all types of risk. Insurance and other traditional risk-shifting tools may be held by or available to us in order to managecertain exposures, but they are subject to terms such as deductibles, coinsurance, limits and policy exclusions, as well as the risk of counterparty denial ofcoverage, default or insolvency.In our Wealth Management business, prevention and detection of wrongdoing or fraud by our advisors, who are not our employees and tend to belocated remotely from our headquarters, present unique challenges. There cannot be any assurance that misconduct by our advisors will not lead to a MaterialAdverse Effect on our business.RIAs have fiduciary obligations that require us and our advisors to act in the best interests of our customers and to disclose any material conflicts ofinterest. Conflicts of interest are under growing scrutiny by U.S. federal and state regulators. Our risk management processes include addressing potentialconflicts of interest that arise in our business. Management of potential conflicts of interest has become increasingly complex. A perceived or actual failure toaddress conflicts of interest adequately could affect our reputation, the willingness of customers to transact business with us or give rise to litigation orregulatory actions, any of which could have a Material Adverse Effect.Our business depends on our strong reputation and the value of our brands, which could be negatively impacted by poor performance.Developing and maintaining awareness of our brands is critical to achieving widespread acceptance of our existing and future products and servicesand is an important element in attracting new customers. Adverse publicity (whether or not justified) relating to regulatory proceedings or other events oractivities attributed to our businesses, our employees, our vendors, or our partners may tarnish our reputation and reduce the value of our brands. Damage toour reputation and loss of23Table of Contentsbrand equity may reduce demand for our products and services and have a material adverse effect on our future financial results. Such damage also wouldrequire additional resources to rebuild our reputation and restore the value of the brands.If others claim that our services infringe upon their intellectual property rights, we may be forced to seek expensive licenses, reengineer our services,engage in expensive and time-consuming litigation, or stop marketing and licensing our services.Companies and individuals with rights relating to the technology industry have frequently resorted to litigation regarding intellectual propertyrights. These parties have in the past made, and may in the future make, claims against us alleging infringement of patents, copyrights, trademarks, tradesecrets, or other intellectual property or proprietary rights, or alleging unfair competition or violations of privacy or publicity rights. Responding to any suchclaims could be time-consuming, result in costly litigation, divert management’s attention, cause product or service release delays, or require removal orredesigning of our products or services, payment of damages for infringement, or entry into royalty or licensing agreements. Our technology, services, andproducts may not be able to withstand any third-party claims or rights against their use. In some cases, the ownership or scope of an entity’s or person’s rightsis unclear. In addition, the ownership or scope of such rights may be altered by changes in the legal landscape, such as through developments in U.S. orinternational intellectual property laws or regulations or through court, agency, or regulatory board decisions. If a successful claim of infringement were madeagainst us and we could not develop non-infringing technology or content or license the infringed or similar technology or content on a timely and cost-effective basis, our financial condition and results of operations could be materially and adversely affected.We do not regularly conduct patent searches to determine whether the technology used in our products or services infringes patents held by thirdparties. Patent searches may not return every issued patent or patent application that may be deemed relevant to a particular product or service. It is thereforedifficult to determine, with any level of certainty, whether a particular product or service may be construed as infringing a current or future U.S. or foreignpatent.We rely heavily on our technology and intellectual property, but we may be unable to adequately or cost-effectively protect or enforce ourintellectual property rights, thereby weakening our competitive position and negatively impacting our business and financial results. We may have to litigateto enforce our intellectual property rights, which can be time consuming, expensive, and difficult to predict.To protect our rights related to our services and technology, we rely on a combination of copyright and trademark laws, trade secrets, confidentialityagreements with employees and third parties, and protective contractual provisions. We also rely on laws pertaining to trademarks and domain names toprotect the value of our corporate brands and reputation. Despite our efforts to protect our proprietary rights, unauthorized parties may copy aspects of ourservices or technology, obtain and use information, marks, or technology that we regard as proprietary, or otherwise violate or infringe our intellectualproperty rights. In addition, it is possible that others could independently develop substantially equivalent intellectual property. Effectively policing theunauthorized use of our services and technology is time-consuming and costly, and the steps taken by us may not prevent misappropriation of ourtechnology or other proprietary assets. If we do not effectively protect our intellectual property, or if others independently develop substantially equivalentintellectual property, our competitive position could be materially weakened.We may seek to acquire companies or assets that complement our Wealth Management and Tax Preparation businesses, and if we are unsuccessful incompleting any such acquisitions on favorable terms or integrating any company acquired it could result in a Material Adverse Effect.We may seek to acquire companies or assets that complement our Wealth Management and Tax Preparation businesses. There can be no guaranteethat any of the opportunities that we evaluate will result in the purchase by us of any business or asset being evaluated, or that, if acquired, we will be able tosuccessfully integrate such acquisition.If we are successful in our pursuit of any complementary acquisition opportunities, we intend to use available cash, debt and/or equity financing,and/or other capital or ownership structures designed to diversify our capital sources and attract a competitive cost of capital, all of which may change ourleverage profile. There are a number of factors that impact our ability to succeed in acquiring the companies and assets we identify, including competition forthese companies and assets, sometimes from larger or better-funded competitors. As a result, our success in completing acquisitions is not guaranteed. Ourexpectation is that, to the extent we are successful, any acquisitions will be additive to our businesses, taking into account potential benefits of operationalsynergies. However, these new business additions and acquisitions, if any, involve a number of risks and may not achieve our expectations, and, therefore, wecould be materially and adversely affected by any such new business additions or acquisitions. There can be no assurance that the short or long-term value ofany business or technology that we develop or acquire will be equal to the value of the cash and other consideration that we pay or expenses we incur.RISKS RELATED TO OUR FINANCING ARRANGEMENTS24Table of ContentsWe incurred debt in connection with the repayment of our credit facility used for the acquisition of HD Vest and the redemption of our convertible seniornotes and may incur future debt, which may materially and adversely affect our financial condition and future financial results.In May 2017, we entered into a credit agreement with a syndicate of lenders in order to (a) refinance the credit facilities previously entered into in2015 to finance the HD Vest acquisition, (b) redeem our convertible notes that were outstanding at the time, and (c) provide a term loan and revolving line ofcredit for future working capital, capital expenditure and general business purposes (the “Blucora senior secured credit facilities”). As of December 31, 2018,we had $265.0 million of outstanding indebtedness under the term loan, and we had not borrowed any amounts under the revolving credit facility. The finalmaturity date of the term loan is May 22, 2024. Under the terms of the revolving credit facility, we may borrow up to $50.0 million.This borrowing may materially and adversely affect our financial condition and future financial results by, among other things:•increasing our vulnerability to downturns in our businesses, to competitive pressures, and to adverse economic and industry conditions;•requiring the dedication of a portion of our expected cash from operations to service the indebtedness, thereby reducing the amount of expectedcash flow available for other purposes, including capital expenditures and complementary acquisitions;•increasing our interest payment obligations in the event that interest rates rise; and•limiting our flexibility in planning for, or reacting to, changes in our businesses and our industries.The Blucora senior secured credit facilities impose certain restrictions on us, including restrictions on our ability to create liens, incur indebtednessand make investments. In addition, the Blucora senior secured credit facilities include covenants, the breach of which may cause the outstandingindebtedness to be declared immediately due and payable. This borrowing, and our ability to repay it, may also negatively impact our ability to obtainadditional financing in the future and may affect the terms of any such financing.In addition, we or our subsidiaries, may incur additional debt in the future. Any additional debt may result in risks similar to those discussed aboveor in other risks specific to the credit agreements entered into for those debts.Existing cash and cash equivalents and cash generated from operations may not be sufficient to meet our anticipated cash needs for servicing debt,working capital, and capital expenditures.Although we believe that existing cash and cash equivalents and cash generated from operations will be sufficient to meet our anticipated cashneeds for servicing debt, working capital, and capital expenditures for at least the next 12 months, the underlying levels of revenues and expenses that weproject may not prove to be accurate. As of December 31, 2018, we had $265.0 million outstanding under our term loan. Servicing this debt will require thededication of a portion of our expected cash flow from operations, thereby reducing the amount of our cash flow available for other purposes. In addition, ourability to make scheduled payments of the principal of, to pay interest on, or to refinance our indebtedness depends on our future performance, which issubject to economic, financial, competitive, and other factors beyond our control. Our businesses may not continue to generate cash flow from operations inthe future sufficient to service our debt and make necessary capital expenditures. If we are unable to generate such cash flow, we may be required to adopt oneor more alternatives, such as selling assets, restructuring debt, or obtaining additional equity capital on terms that may be onerous or highly dilutive. Ourability to refinance our indebtedness will depend on the capital markets and our financial condition and results at such time. We may not be able to engage inany of these activities or engage in these activities on desirable terms, which could result in a default on our debt obligations.In addition, we may evaluate complementary acquisitions of businesses, products, or technologies from time to time. Any such transactions, ifcompleted, may use a significant portion of our cash balances and marketable investments. If we are unable to liquidate our investments when we needliquidity for complementary acquisitions or for other business purposes, we may need to change or postpone such acquisitions or find alternative financingfor them. We may seek additional funding through public or private financings, through sales of equity, or through other arrangements. Our ability to raisefunds may be materially and adversely affected by a number of factors, including factors beyond our control, such as economic conditions in the markets inwhich we operate and increased uncertainty in the financial, capital, and credit markets. Adequate funds may not be available when needed or may not beavailable on favorable terms. If we raise additional funds by issuing equity securities, dilution to existing stockholders may result. Any sale of a substantialamount of our common stock in the public market, either in the initial issuance or in a subsequent resale, could have a material adverse effect on the marketprice of our common stock. If funding is insufficient at any time in the future, we may be unable, or delayed in our ability, to develop or enhance our25Table of Contentsproducts or services, take advantage of business opportunities, or respond to competitive pressures, any of which could materially harm our business.OTHER RISKSOur stock price has been highly volatile and such volatility may continue.The trading price of our common stock has been highly volatile, and such volatility does not always correspond to fluctuations in the market.Between January 1, 2017 and December 31, 2018, our closing stock price ranged from $14.45 to $40.25. On February 22, 2019, the closing price of ourcommon stock was $27.02. Our stock price could decline or fluctuate significantly in response to many factors, including the other risks discussed in thisreport and the following:•actual or anticipated variations in quarterly and annual results of operations;•impairment charges, changes in or loss of material contracts and relationships, dispositions or announcements of complementary acquisitions, orother business developments by us, our partners, or our competitors;•conditions or trends in the tax preparation or wealth management markets or changes in market share;•changes in general conditions in the United States and global economies or financial markets;•announcements of technological innovations or new services by us or our competitors;•changes in financial estimates or recommendations by securities analysts;•disclosures of any accounting issues, such as restatements or material weaknesses in internal control over financial reporting;•equity issuances resulting in the dilution of stockholders;•the adoption of new regulations or accounting standards;•adverse publicity (whether justified or not) with respect to our business; and•announcements or publicity relating to litigation or governmental enforcement actions.In addition, the equities market has experienced extreme price and volume fluctuations, and our stock has been particularly susceptible to suchfluctuations. Often, class action litigation has been instituted against companies after periods of volatility in the price of such companies’ stock. We havebeen defendants in such class action litigation in prior periods and could be subject to future litigation, potentially resulting in substantial cost and diversionof management’s attention and resources.Our financial results may fluctuate, which could cause our stock price to be volatile or decline.Our financial results have varied on a quarterly basis and are likely to continue to fluctuate in the future. These fluctuations could cause our stockprice to be volatile or decline. Many factors could cause our quarterly results to fluctuate materially, including but not limited to:•the inability of any of our businesses to implement business plans and to meet our expectations;•the seasonality of our Tax Preparation business and the resulting large quarterly fluctuations in our revenues;•variable demand for our services, rapidly evolving technologies and markets, and consumer preferences;•the level and mix of total client assets and advisory assets, which are subject to fluctuation based on market conditions and customer activity;•the mix of revenues generated by existing businesses, discontinued operations or other businesses that we develop or acquire;•changes in interest rates affecting cash sweep revenue;•volatility in stock markets impacting the value of our advisory assets;•gains or losses driven by fair value accounting;•litigation expenses and settlement costs;•misconduct by employees and/or HD Vest financial advisors, which is difficult to detect and deter;•expenses incurred in finding, evaluating, negotiating, consummating, and integrating acquisitions;•impairment or negative performance of the many different industries and counterparties we rely on and are exposed to;•any restructuring charges we may incur;•any economic downturn, which could result in lower acceptance rates on premium products and services offered by our Wealth Managementbusiness and impact the commissions and fee revenues of our financial advisory services;•new court rulings, or the adoption of new or interpretation of existing laws, rules, or regulations, that adversely affect our business or that otherwiseincrease our potential liability or compliance costs;•impairment in the value of long-lived assets or the value of acquired assets, including goodwill, technology, and acquired contracts andrelationships; and•the effect of changes in accounting principles or standards or in our accounting treatment of revenues or expenses.26Table of ContentsFor these reasons, among others, you should not rely on period-to-period comparisons of our financial results to forecast our future performance.Furthermore, our fluctuating operating results may fall below the expectations of securities analysts or investors and financial results volatility could make usless attractive to investors, either of which could cause the trading price of our stock to decline.Our utilization of our federal net operating loss carryforwards (“NOLs”) may be severely limited or potentially eliminated.As of December 31, 2018, we had federal NOLs of $454.5 million that will expire primarily between 2020 and 2027, with the majority of themexpiring between 2020 and 2024. We are currently able to offset all of our tax liabilities with our federal NOLs, but we may not generate sufficient taxableincome in future years to utilize all of our NOLs prior to their expiration. If our federal NOLs expire unused, their full benefit will not be achieved. Inaddition, in years where our income exceeds our federal NOLs, which we expect to begin occurring in 2022, we will be required to make additional incometax payments.In addition, if we were to have a change of ownership within the meaning of Section 382 of the Internal Revenue Code (defined as a cumulativechange of 50 percentage points or more in the ownership positions of certain stockholders owning five percent or more of a company’s common stock over athree-year rolling period), then under certain conditions, the amount of NOLs we could use in any one year could be limited. Our certificate of incorporationimposes certain limited transfer restrictions on our common stock that we expect will assist us in preventing a change of ownership and preserving our NOLs,but there can be no assurance that these restrictions will be sufficient. In addition, other restrictions on our ability to use the NOLs may be triggered by amerger or acquisition, depending on the structure of such a transaction. It is our intention to limit the potential impact of these restrictions, but there can beno guarantee that such efforts will be successful.If we are unable to use our federal NOLs before they expire, or if the use of this tax benefit is severely limited or eliminated, there could be a materialreduction in the amount of after-tax income and cash flow from operations, and it could have an effect on our ability to engage in certain transactions.Delaware law and our charter documents may impede or discourage a takeover, which could cause the market price of our shares to decline.We are a Delaware corporation, and the anti-takeover provisions of Delaware law impose various impediments to the ability of a third party toacquire us, even if a change of control would be beneficial to our existing stockholders. For example, Section 203 of the Delaware General Corporation Lawmay discourage, delay, or prevent a change in control by prohibiting us from engaging in a business combination with an interested stockholder for a periodof three years after the person becomes an interested stockholder. In addition, our certificate of incorporation and bylaws contain provisions that maydiscourage, delay, or prevent a third party from acquiring us without the consent of our board of directors, even if doing so would be beneficial to ourstockholders. Provisions of our charter documents that could have an anti-takeover effect include:•the classification of our board of directors, which is being phased out between 2017 and 2020, into three groups so that directors serve staggeredthree-year terms, which may make it difficult for a potential acquirer to gain control of our board of directors;•the requirement for supermajority approval by stockholders for certain business combinations;•the ability of our board of directors to authorize the issuance of shares of undesignated preferred stock without a vote by stockholders;•the ability of our board of directors to amend or repeal our bylaws;•limitations on the removal of directors;•limitations on stockholders’ ability to call special stockholder meetings;•advance notice requirements for nominating candidates for election to our board of directors or for proposing matters that can be acted upon bystockholders at stockholder meetings; and•certain restrictions in our certificate of incorporation on transfers of our common stock designed to preserve our federal NOLs.At our 2009 annual meeting, our stockholders approved an amendment to our certificate of incorporation that restricts any person or entity fromattempting to transfer our stock, without prior permission from the Board of Directors, to the extent that such transfer would (i) create or result in anindividual or entity becoming a five-percent stockholder of our stock, or (ii) increase the stock ownership percentage of any existing five-percentstockholder. This amendment provides that any transfer that violates its provisions shall be null and void and would require the purported transferee to, uponour demand, transfer the shares that exceed the five percent limit to an agent designated by us for the purpose of conducting a sale of such excess shares.27Table of ContentsThis provision in our certificate of incorporation may make the acquisition of Blucora more expensive to the acquirer and could significantly delay,discourage, or prevent third parties from acquiring Blucora without the approval of our board of directors. 28Table of ContentsITEM 1B. Unresolved Staff CommentsNone.ITEM 2. Properties All of our facilities are leased. We believe our properties are suitable and adequate for our present needs.Our principal corporate office is located in Irving, Texas. The headquarters and data center facility for our HD Vest business, which comprises ourWealth Management segment, are in Irving, Texas, and we have a backup data center for our HD Vest business in Elk Grove, Illinois, as well as access tomultiple disaster recovery and data centers across the country through a third party vendor. The headquarters for our TaxAct business, which comprises ourTax Preparation segment, is in Cedar Rapids, Iowa. Our TaxAct business leverages cloud computing for primary and disaster recovery data services.ITEM 3. Legal ProceedingsSee "Note 11: Commitments and Contingencies" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for informationregarding legal proceedings.ITEM 4. Mine Safety DisclosuresNone.29Table of ContentsPART IIITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity SecuritiesMarket for Our Common StockOur common stock trades on the NASDAQ Global Select Market under the symbol “BCOR.” On February 22, 2019, the last reported sale price for ourcommon stock on the NASDAQ Global Select Market was $27.02 per share.HoldersAs of February 22, 2019, there were 359 holders of record of our common stock. A substantially greater number of holders are beneficial owners whoseshares are held of record by banks, brokers, and other financial institutions.Share RepurchasesThere were no stock repurchases in 2018 and 2017.30Table of ContentsITEM 6. Selected Financial DataThe following data is derived from our audited consolidated financial statements and should be read along with "Management’s Discussion andAnalysis of Financial Condition and Results of Operations" in Part II Item 7, our consolidated financial statements and notes in Part II Item 8, and the otherfinancial information included elsewhere in this report. Years ended December 31, 2018 2017 2016 2015 2014Consolidated Statements of Operations Data:(1) (In thousands, except per share data)Revenue: Wealth management services revenue $373,174 $348,620 $316,546 $— $—Tax preparation services revenue 187,282 160,937 139,365 117,708 103,719Total revenue 560,456 509,557 455,911 117,708 103,719Operating income (loss) 67,677 48,037 37,117 (4,807) 4,603Other loss, net (15,797) (44,551) (39,781) (12,542) (13,489)Income (loss) from continuing operations before incometaxes 51,880 3,486 (2,664) (17,349) (8,886)Income tax benefit (expense)(311) 25,890 1,285 4,623 3,342Income (loss) from continuing operations 51,569 29,376 (1,379) (12,726) (5,544)Discontinued operations, net of income taxes(2) — — (63,121) (27,348) (30,003)Net income (loss) 51,569 29,376 (64,500) (40,074) (35,547)Net income attributable to noncontrolling interests (935) (2,337) (658) — —Net income (loss) attributable to Blucora, Inc. $50,634 $27,039 $(65,158) $(40,074) $(35,547)Net income (loss) per share attributable to Blucora, Inc. - basic: Continuing operations $0.94 $0.61 $(0.05) $(0.31) $(0.13)Discontinued operations — — (1.52) (0.67) (0.73)Basic net income (loss) per share $0.94 $0.61 $(1.57) $(0.98) $(0.86)Weighted average shares outstanding, basic 47,394 44,370 41,494 40,959 41,396Net income (loss) per share attributable to Blucora, Inc. - diluted: Continuing operations $0.90 $0.57 $(0.05) $(0.31) $(0.13)Discontinued operations — — (1.52) (0.67) (0.73)Diluted net income (loss) per share $0.90 $0.57 $(1.57) $(0.98) $(0.86)Weighted average shares outstanding, diluted 49,381 47,211 41,494 40,959 41,396Consolidated Balance Sheet Data:(1) Cash, cash equivalents, and investments $84,524 $59,965 $58,814 $66,774 $293,588Working capital(2) (3) (4) 82,788 47,641 43,480 174,571 299,431Total assets 997,725 1,001,671 1,022,659 1,299,548 865,775Total long-term liabilities(2) (3) (4) 316,905 390,495 535,577 656,122 311,692Total stockholders’ equity 607,595 541,387 417,019 462,284 479,025(1) On December 31, 2015, we acquired HD Vest. See "Note 4: Business Combinations" of the Notes to Consolidated Financial Statements in Part II Item 8of this report.(2) On October 14, 2015, we announced plans to divest the Search and Content and E-Commerce businesses. Accordingly, the operating results of thesebusinesses have been presented as discontinued operations for all periods presented, and the related balance sheet data has been classified in its entiretywithin current assets and current liabilities as of December 31, 2015 but classified within current and long-term assets and liabilities, as appropriate, forprior periods. We sold the Search and Content business and the E-Commerce business on August 9, 2016 and November 17, 2016, respectively.31Table of Contents(3) During 2016 our Convertible Senior Notes were classified as a long-term liability with an outstanding balance, net of discount and issuance costs, of$164.2 million. See "Note 10: Debt" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.(4) See "Note 5: Discontinued Operations" and "Note 10: Debt" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for adiscussion of debt activity.ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsYou should read the following discussion and analysis in conjunction with the Selected Financial Data and our consolidated financial statementsand notes thereto included elsewhere in this report. The following discussion contains forward-looking statements that are subject to risks anduncertainties. See Part I "Cautionary Statement Regarding Forward-Looking Statements" for a discussion of the uncertainties, risks and assumptionsassociated with those statements. Actual results could differ materially from those discussed in or implied by forward-looking statements as a result ofvarious factors, including those discussed below and elsewhere in this report, particularly in the section titled "Risk Factors."Introduction and Company HistoryBlucora operates two businesses: a Wealth Management business and a digital Tax Preparation business. The Wealth Management business consists ofthe operations of HD Vest, which provides wealth management solutions for financial advisors and their clients. The Tax Preparation business consists of theoperations of TaxAct and provides digital tax preparation solutions for consumers, small business owners, and tax professionals.For a further discussion of Blucora's businesses and history, see "Business" in Part I Item 1 of this report.Recent DevelopmentsIn 2018, we commenced our new clearing services relationship with Fidelity Clearing & Custody Solutions pursuant to an agreement that we executedduring the third quarter of 2017. We expect the new clearing relationship to provide tangible benefits to our advisors and customers in the form of improvedtechnology, product offerings and service. We currently expect that this relationship could generate in excess of $120.0 million of incremental WealthManagement segment income over the 10 years following the conversion to the new platform. In the fourth quarter of 2018, we received approximately $9.3million of operating cash flows from incentives from this relationship, which will benefit Wealth Management segment income over the succeeding 10 yearsand will offset operating expenses.SeasonalityOur Tax Preparation segment is highly seasonal, with a significant portion of its annual revenue earned in the first four months of our fiscal year. Duringthe third and fourth quarters, the Tax Preparation segment typically reports losses because revenue from the segment is minimal while core operatingexpenses continue. We anticipate that the seasonal nature of that part of the business will continue in the foreseeable future.RESULTS OF OPERATIONSSummary(In thousands, except percentages)Years ended December 31, 2018 Change 2017 Change 2016Revenue$560,456 10% $509,557 12% $455,911Operating income$67,677 41% $48,037 29% $37,117Year ended December 31, 2018 compared with year ended December 31, 2017Revenue increased approximately $50.9 million due to increases of $24.6 million and $26.3 million in revenue related to our Wealth Management andTax Preparation businesses, respectively, as discussed in the following "Segment Revenue/Operating Income" section.Operating income increased approximately $19.6 million, consisting of the $50.9 million increase in revenue and offset by a $31.3 million increase inoperating expenses. Key changes in operating expenses were:32Table of Contents•$22.4 million increase in the Wealth Management segment's operating expenses, primarily due to higher commissions paid to our financialadvisors, which fluctuated in proportion to the change in underlying commission and advisory revenues earned on client accounts, consultingcosts, costs incurred in connection with our transition to our new clearing firm, and an increase in stock-based compensation expense related tostock options granted to certain HD Vest financial advisors.•$12.0 million increase in the Tax Preparation segment’s operating expenses, primarily due to higher spend on marketing, particularly offlinemedia and digital marketing efforts, an increase in engineering development projects, an increase in consulting expenses primarily related tostrategic initiatives and an increase in personnel costs, that was primarily related to additional headcount.•$3.2 million decrease in corporate-level expense activity, primarily due to lower Strategic Transformation costs, which primarily consisted ofseverance and other personnel-related costs, offset by higher depreciation due to the abandonment of certain internally-developed software fixedassets and an increase in personnel costs, that was primarily related to additional headcount.Year ended December 31, 2017 compared with year ended December 31, 2016Revenue increased approximately $53.6 million due to increases of $32.1 million and $21.6 million in revenue related to our Wealth Management andTax Preparation businesses, respectively, as discussed in the following "Segment Revenue/Operating Income" section.Operating income increased approximately $10.9 million, consisting of the $53.6 million increase in revenue and offset by a $42.7 million increase inoperating expenses. Key changes in operating expenses were:•$27.5 million increase in the Wealth Management segment's operating expenses, primarily due to higher commissions paid to our financialadvisors, which fluctuated in proportion to the change in underlying commission and advisory revenues earned on client accounts, and higher netpersonnel expenses as we continued to standardize employee benefits across our businesses.•$15.5 million increase in the Tax Preparation segment’s operating expenses, primarily due to higher spending on marketing, higher professionalservices fees mostly related to marketing and development projects, higher data center costs related to software support and maintenance fees,increases in growth initiative investments, and higher personnel expenses.•$0.3 million decrease in corporate-level expense activity, primarily due to lower stock-based compensation costs due to fewer grants in 2017compared to 2016 and higher expense recognized in 2016 related to grants made to HD Vest employees in 2016 in connection with the HD Vestacquisition, partially offset by decreases within our Tax Preparation business due to prior forfeitures, and lower personnel costs, both offset byStrategic Transformation costs.SEGMENT REVENUE/OPERATING INCOMEThe revenue and operating income amounts in this section are presented on a basis consistent with accounting principles generally accepted in the U.S.(“GAAP”) and include certain reconciling items attributable to our segments. Segment information appearing in "Note 3: Segment Information andRevenues" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report is presented on a basis consistent with our current internalmanagement financial reporting. We do not allocate certain general and administrative costs (including personnel and overhead costs), stock-basedcompensation, acquisition-related costs, depreciation, amortization of acquired intangible assets, restructuring, other loss, net, and income taxes to segmentoperating results. Rather, we analyze such general and administrative costs separately under the heading "Corporate-level activity."We have two reportable segments: Wealth Management and Tax Preparation.33Table of ContentsWealth Management(In thousands, except percentages)Years ended December 31, 2018 Change 2017 Change 2016Revenue$373,174 7% $348,620 10% $316,546Operating income$53,053 4% $50,916 10% $46,296Segment margin14% 15% 15%Wealth Management revenue is derived from multiple sources. We track sources of revenue, primary drivers of each revenue source, and recurringrevenue. In addition, we focus on several business and key financial metrics in evaluating the success of our business relationships, our resulting financialposition and operating performance. A summary of our sources of revenue and business metrics are as follows.Sources of revenue(In thousands, except percentages)Year ended December 31, Sources of RevenuePrimary Drivers2018 Change 2017 Change 2016Advisor-drivenCommission- Transactions- Asset levels$164,201 2 % $160,241 7% $150,125Advisory- Advisory asset levels164,353 13 % 145,694 13% 129,417Other revenueAsset-based- Cash balances- Interest rates- Number of accounts- Client asset levels31,456 20 % 26,297 16% 22,653Transaction and fee- Account activity- Number of clients- Number of advisors- Number of accounts13,164 (20)% 16,388 14% 14,351 Total revenue$373,174 7 % $348,620 10% $316,546 Total recurring revenue$303,117 9 % $277,546 11% $249,310 Recurring revenue rate81.2% 79.6% 78.8%Recurring revenue consists of trailing commissions, advisory fees, fees from cash sweep programs, and certain transaction and fee revenue, all asdescribed further below in Commission revenue, Advisory revenue, Asset-based revenue, and Transaction and fee revenue, respectively. Certain recurringrevenues are associated with asset balances and fluctuate depending on market values and current interest rates. Accordingly, our recurring revenue can benegatively impacted by adverse external market conditions. However, we believe recurring revenue is meaningful despite these fluctuations because it is notdependent upon transaction volumes or other activity-based revenues, which are more difficult to predict, particularly in declining or volatile markets.Business metrics(In thousands, except percentages and as otherwise indicated) Years ended December 31, 2018 Change 2017 Change 2016Total Client Assets$42,249,055 (4)% $44,178,710 14 % $38,663,566Brokerage Assets$29,693,650 (4)% $31,648,545 12 % $28,266,495Advisory Assets$12,555,405 — % $12,530,165 21 % $10,397,071Percentage of Total Client Assets29.7% 28.4% 26.9%Number of advisors (in ones)3,593 (10)% 3,999 (11)% 4,472Advisor-driven revenue per advisor23.2 14 % 20.4 25 % 16.3Total client assets ("total client assets") includes assets that we hold directly or indirectly on behalf of clients under a safekeeping or custodyarrangement or for which we provide administrative services for clients. To the extent that we provide more than one service for a client’s assets, the value ofthe asset is only counted once in the total amount of total client assets. Total client assets include advisory assets, non-advisory brokerage accounts,annuities and mutual fund positions held directly with fund companies. These assets are not reported on the consolidated balance sheets. Total client assetswere previously reported as "Assets Under Administration" or "AUA."34Table of ContentsFor the year ended December 31, 2018, total client assets includes $34.5 million of assets held at our former clearing firm for which we are broker-of-record and whose conversion was administratively delayed.Advisory assets ("advisory assets") includes external client assets for which we provide investment advisory and management services, typically as afiduciary under the Investment Advisers Act of 1940. Our compensation for providing such services is typically a fee based on the value of the advisoryassets for each advisory client. These assets are not reported on the consolidated balance sheets. Advisory assets were previously reported as "Assets UnderManagement" or "AUM."Brokerage assets represents the difference between total client assets and advisory assets.We have been reducing disengaged advisors who have little to no assets held with us, which has resulted in advisor counts trending down. As wecontinue to reduce disengaged advisors, the number of advisors could continue to decrease before stabilizing. This decrease has resulted in, and is expectedto continue to improve, the growth in advisor-driven revenues per advisor.Year ended December 31, 2018 compared with year ended December 31, 2017Wealth Management revenue increased approximately $24.6 million as a result of the factors discussed with each source of revenue below.Wealth Management operating income increased approximately $2.1 million, consisting of the $24.6 million increase in revenue, offset by a $22.4million increase in operating expenses. The increase in Wealth Management operating expenses was primarily due to higher commissions paid to ourfinancial advisors, which fluctuated in proportion to the change in underlying commission and advisory revenues earned on client accounts, consulting costsand costs incurred in connection with our transition to our new clearing firm, and an increase in stock-based compensation expense related to stock optionsgranted to certain HD Vest financial advisors.Year ended December 31, 2017 compared with year ended December 31, 2016Wealth Management revenue increased approximately $32.1 million as a result of the factors discussed with each source of revenue below.Wealth Management operating income increased approximately $4.6 million, consisting of the $32.1 million increase in revenue, offset by a $27.5million increase in operating expenses. The increase in Wealth Management operating expenses was primarily due to higher commissions paid to ourfinancial advisors, which fluctuated in proportion to the change in underlying commission and advisory revenues earned on client accounts, and higher netpersonnel expenses as we continued to standardize employee benefits across our businesses.35Table of ContentsCommission revenue: The Wealth Management segment generates two types of commissions: transaction-based sales commissions and trailingcommissions. Transaction-based sales commissions, which occur when clients trade securities or purchase investment products, represent gross commissionsgenerated by our financial advisors. The level of transaction-based sales commissions can vary from period-to-period based on the overall economicenvironment, number of trading days in the reporting period, market volatility, interest rate fluctuations and investment activity of our financial advisors'clients. We earn trailing commissions (a commission or fee that is paid periodically over time) on certain mutual funds and variable annuities held by clients.Trailing commissions are recurring in nature and are based on the market value of investment holdings in trail-eligible assets. Our commission revenue, byproduct category and by type of commission revenue, was as follows:(In thousands)Years ended December 31, 2018 Change 2017 Change 2016By product category: Mutual funds$87,624 4 % $84,159 6% $79,476Variable annuities51,199 — % 51,385 8% 47,641Insurance14,160 8 % 13,146 10% 11,909General securities11,218 (3)% 11,551 4% 11,099Total commission revenue$164,201 2 % $160,241 7% $150,125By sales-based and trailing: Sales-based$67,350 (1)% $68,199 6% $64,452Trailing96,851 5 % 92,042 7% 85,673Total commission revenue$164,201 2 % $160,241 7% $150,125In 2018, sales-based commission revenue decreased approximately $0.8 million, primarily due to increased activity in equities, that was more thanoffset by decreased activity in mutual funds and alternative investments. General securities include equities, exchange-traded funds, bonds and alternativeinvestments.In 2018, trailing commission revenue increased approximately $4.8 million and reflects an increase in the market value of the underlying assets.In 2017, sales-based commission revenue increased approximately $3.7 million, primarily due to increased activity in mutual funds, insurance andgeneral securities resulting from overall market performance, portfolio rebalancings, product availability and segment refocusing. General securities includeequities, exchange-traded funds, bonds and alternative investments.In 2017, trailing commission revenue increased approximately $6.4 million and reflects an increase in the market value of the underlying assets and theimpact of new investments.Advisory revenue: Advisory revenue primarily includes fees charged to clients in advisory accounts where HD Vest is the Registered InvestmentAdviser (“RIA”) and is based on the value of advisory assets. Advisory fees are typically billed to clients quarterly, in advance, and are recognized asrevenue ratably during the quarter. The value of the assets in an advisory account on the billing date determines the amount billed and, accordingly, therevenues earned in the following three-month period. The majority of our accounts are billed in advance using values as of the last business day of the priorcalendar quarter.The activity within our advisory assets was as follows:(In thousands)Year ended December 31, 2018 2017 2016Balance, beginning of the period$12,530,165 $10,397,071 $9,692,244Net increase in new advisory assets957,252 794,184 150,701Market impact and other(932,012) 1,338,910 554,126Balance, end of the period$12,555,405 $12,530,165 $10,397,071Increases or decreases in advisory assets have a limited impact on advisory fee revenue in the period in which they occur. Rather, increases or decreasesin advisory assets are a primary driver of future advisory fee revenue due to advisory fees being billed in advance. Advisory revenue for a particular quarter ispredominately driven by the prior quarter-end advisory assets.36Table of ContentsIn 2018, the increase in advisory revenue of approximately $18.7 million was primarily due to the increase in the beginning-of-period advisory assetsfor 2018 compared with 2017.In 2017, the increase in advisory revenue of approximately $16.3 million was consistent with the increase in the beginning-of-period advisory assets for2017 compared with 2016.Asset-based revenue: Asset-based revenue primarily includes fees from financial product manufacturer sponsorship programs, cash sweep programs andother asset-based revenues, primarily including margin revenues.In 2018, asset-based revenue increased $5.2 million, primarily from increased revenues from financial product manufacturer sponsorship programs,higher cash sweep revenues following increases in interest rates and impacts from our transition to our new clearing firm in the third quarter of 2018.In 2017, asset-based revenue increased $3.6 million, primarily from higher cash sweep revenues following increases in interest rates.Transaction and fee revenue: Transaction and fee revenue primarily includes support fees charged to advisors, fees charged for executing certaintransactions in client accounts, and other fees related to services provided and other account charges as generally outlined in agreements with financialadvisors, clients, and financial institutions.In 2018, transaction and fee revenue decreased approximately $3.2 million primarily due to the impact of the adoption of new revenue recognitionstandards in the first quarter of 2018 and lower technology fees. See "Note 2: Summary of Significant Accounting Policies" of the Notes to ConsolidatedFinancial Statements in Part II Item 8 of this report for additional information concerning the impact of the new revenue recognition standards on ouroperating results.In 2017, transaction and fee revenue increased approximately $2.0 million primarily related to advisor fee increases.Tax Preparation(In thousands, except percentages)Years ended December 31, 2018Change2017 Change 2016Revenue$187,282 16% $160,937 15% $139,365Operating income$87,249 20% $72,921 9% $66,897Segment margin47% 45% 48%Tax Preparation revenue is derived primarily from the sale of tax preparation digital services, ancillary services, packaged tax preparation software, andarrangements that may include a combination of these items. Ancillary services include tax preparation support services, e-filing services, bank or reloadablepre-paid debit card services, and other value-added services, including tax and wealth management services through our Wealth Management business.Revenue by category was as follows:(In thousands, except percentages)Years ended December 31, 2018 Change 2017 Change 2016Consumer$172,207 17% $147,084 16% $126,289Professional15,075 9% 13,853 6% 13,076Total revenue$187,282 16% $160,937 15% $139,365We measure our consumer tax preparation customers using the number of accepted federal tax e-files made through our software and digital services. Weconsider the volume of e-files to be an important non-financial metric in measuring the performance of the consumer side of the Tax Preparation business. E-file metrics were as follows:37Table of Contents(In thousands, except percentages)Years ended December 31, 2018 Change 2017 Change 2016Digital e-files3,539 (14)% 4,097 (17)% 4,926Desktop e-files159 (18)% 193 (21)% 244Total e-files3,698 (14)% 4,290 (17)% 5,170We participate in the Free File Alliance that is part of an IRS partnership that provides free electronic tax filing services to taxpayers meeting certainincome-based guidelines. Free File Alliance e-files are included within digital e-files above.We measure our professional tax preparer customers using three metrics: the number of accepted federal tax e-files made through our software, thenumber of units sold, and the number of e-files per unit sold. We consider growth in these areas to be important non-financial metrics in measuring theperformance of the professional tax preparer side of the Tax Preparation business. Those metrics were as follows:(In thousands, except percentages and asYears ended December 31,otherwise indicated)2018 Change 2017 Change 2016E-files1,833 3 % 1,774 1 % 1,755Units sold (in ones)20,636 — % 20,694 2 % 20,290E-files per unit sold (in ones)88.8 4 % 85.7 (1)% 86.5Year ended December 31, 2018 compared with year ended December 31, 2017Tax Preparation revenue increased approximately $26.3 million, primarily due to growth in revenue earned from digital consumer users and increasedsales of our professional tax preparer software. Digital consumer revenue grew, despite a decrease in e-files, due to growth in average revenue per user,primarily resulting from price increases, which are expected to continue to be the primary driver of growth in the near future. The decrease in e-files wasconsistent with our expectations as we continued our multi-year pivot toward more profitable customers. Revenue derived from professional tax preparersincreased, despite a minor decrease in the number of professional preparer units sold, primarily due to growth in average revenue per user, primarily resultingfrom price increases. Revenue from ancillary services, primarily tax refund payment transfer, also grew primarily resulting from price increases.Tax Preparation operating income increased approximately $14.3 million, consisting of the $26.3 million increase in revenue and offset by a $12.0million increase in operating expenses. The increase in Tax Preparation segment operating expenses was primarily due to higher spend on marketing,particularly offline media and digital marketing efforts, an increase in engineering development projects, and an increase in consulting expenses primarilyrelated to strategic initiatives.Year ended December 31, 2017 compared with year ended December 31, 2016Tax Preparation revenue increased approximately $21.6 million primarily due to growth in revenue earned from digital consumer users and, to a lesserextent, increased sales of our professional tax preparer software. Digital consumer revenue grew, despite a decrease in e-files, due to growth in averagerevenue per user, primarily resulting from price increases. Revenue derived from professional tax preparers increased primarily due to an increase in thenumber of professional preparer units sold.Tax Preparation operating income increased approximately $6.0 million, consisting of the $21.6 million increase in revenue and offset by a $15.5million increase in operating expenses. The increase in Tax Preparation segment operating expenses was primarily due to higher spending on marketing,higher professional services fees mostly related to marketing and development projects, higher data center costs related to software support and maintenancefees, increases in growth initiative investments, and higher personnel expenses.38Table of ContentsCorporate-Level Activity(In thousands)Years ended December 31, 2018 Change 2017 Change 2016Operating expenses$20,494 $(2,413) $22,907 $3,908 $18,999Stock-based compensation13,253 1,600 11,653 (2,475) 14,128Acquisition-related costs— — — (391) 391Depreciation5,003 866 4,137 (408) 4,545Amortization of acquired intangible assets33,586 (416) 34,002 (141) 34,143Restructuring288 (2,813) 3,101 (769) 3,870Total corporate-level activity$72,624 $(3,176) $75,800 $(276) $76,076Certain corporate-level activity is not allocated to our segments, including certain general and administrative costs (including personnel and overheadcosts), stock-based compensation, acquisition-related costs, depreciation, amortization of acquired intangible assets, and restructuring. For further detail, referto segment information appearing in "Note 3: Segment Information and Revenues" of the Notes to Consolidated Financial Statements in Part II Item 8 of thisreport.Year ended December 31, 2018 compared with year ended December 31, 2017Operating expenses included in corporate-level activity decreased primarily due to lower Strategic Transformation costs, which primarily consisted ofseverance and other personnel-related costs.Stock-based compensation increased primarily due to activity within our Wealth Management business related to stock options granted to certain HDVest financial advisors and a decrease in forfeitures from the prior period, partially offset by lower expenses related to the impact of equity awardmodifications associated with certain individuals impacted by the relocation of our corporate headquarters in 2017.Depreciation expense increased primarily due to the abandonment of certain internally-developed software fixed assets.Restructuring expense relates to non-recurring expenses incurred due to the relocation of our corporate headquarters during 2017 from Bellevue,Washington to Irving, Texas. Further detail is provided under the "Operating Expenses - Restructuring" section below.Year ended December 31, 2017 compared with year ended December 31, 2016Operating expenses included in corporate-level activity increased primarily due to Strategic Transformation Costs and costs associated with leadershipchanges at HD Vest. Strategic Transformation Costs primarily related to the relocation cost of our corporate headquarters and are not classified asrestructuring. These costs are associated with transitioning of roles such as overlap in staffing and recruiting search fees.Stock-based compensation decreased primarily due to fewer grants in the current year and higher expense recognized in 2016 related to grants made toHD Vest employees in 2016 that were made in connection with the HD Vest acquisition, partially offset by activity within our Tax Preparation business dueto prior forfeitures.Acquisition-related costs, depreciation and amortization of acquired intangible assets were comparable to 2016.Restructuring relates to expenses incurred in connection with the relocation of our corporate headquarters in 2017. Further detail is provided under the"Operating Expenses - Restructuring" section of the management's discussion and analysis of financial condition and results of operations below.39Table of ContentsOPERATING EXPENSES Cost of Revenue(In thousands, except percentages)Years ended December 31, 2018Change2017Change2016Wealth management services cost of revenue$253,580 $17,721 $235,859 $21,863 $213,996Tax preparation services cost of revenue10,040 22 10,018 1,650 8,368Amortization of acquired technology99 (96) 195 (617) 812Total cost of revenue$263,719 $17,647 $246,072 $22,896 $223,176Percentage of revenue47% 48% 49%We record the cost of revenue for sales of services when the related revenue is recognized. Services cost of revenue consists of costs related to ourWealth Management and Tax Preparation businesses, which include commissions to financial advisors, third-party costs, and costs associated with thetechnical support team and the operation of our data centers. Data center costs include personnel expenses (salaries, stock-based compensation, benefits, andother employee-related costs), the cost of temporary help and contractors, professional services fees (which include technology project consulting fees),software support and maintenance, bandwidth and hosting costs, and depreciation. Cost of revenue also includes the amortization of acquired technology.Year ended December 31, 2018 compared with year ended December 31, 2017Wealth management services cost of revenue increased primarily due to higher commissions paid to our financial advisors, which fluctuated inproportion to the change in underlying commission and advisory revenues earned on client accounts.Tax preparation services cost of revenue was comparable to 2017 as the cost of maintaining our tax preparation platform is somewhat fixed, and doesnot necessarily vary with revenues.Year ended December 31, 2017 compared with year ended December 31, 2016Wealth management services cost of revenue increased primarily due to an increase in commissions paid to our financial advisors, which fluctuated inproportion to the change in underlying commission and advisory revenues earned on client accounts, and higher stock-based compensation costs related togrants to certain HD Vest financial advisors made during 2017 because no comparable grants were made in 2016.Tax preparation services cost of revenue increased primarily due to an increase in data center costs related to software support and maintenance fees.Amortization of acquired technology decreased due to amortization expense associated with concluding the useful life of certain TaxAct acquisition-related intangible assets during 2016.Engineering and Technology(In thousands, except percentages)Years ended December 31, 2018Change2017Change2016Engineering and technology$19,332 $(282) $19,614 $1,834 $17,780Percentage of revenue3% 4% 4%Engineering and technology expenses are associated with the research, development, support, and ongoing enhancements of our offerings, whichinclude personnel expenses (salaries, stock-based compensation, benefits, and other employee-related costs), the cost of temporary help and contractors,software support and maintenance, bandwidth and hosting, and professional services fees.Year ended December 31, 2018 compared with year ended December 31, 201740Table of ContentsEngineering and technology expenses were substantially the same compared to the prior year.Year ended December 31, 2017 compared with year ended December 31, 2016Engineering and technology expenses increased primarily due to an increase in consulting and professional services fees, mostly related to TaxPreparation development projects.Sales and Marketing(In thousands, except percentages)Years ended December 31, 2018 Change 2017 Change 2016Sales and marketing$111,361 $8,563 $102,798 $13,438 $89,360Percentage of revenue20% 20% 20%Sales and marketing expenses consist principally of personnel expenses (salaries, stock-based compensation, benefits, and other employee-relatedcosts) and the cost of temporary help and contractors for those engaged in marketing, selling, and sales support operations activities, marketing expensesassociated with our HD Vest and TaxAct businesses (which primarily include television, radio, online, text, email, and sponsorship channels), and back officeprocessing support expenses associated with our HD Vest business (occupancy and general office expenses, regulatory fees, and license fees).Year ended December 31, 2018 compared with year ended December 31, 2017Sales and marketing expenses increased primarily due to higher spend on marketing, particularly offline media and digital marketing efforts in our TaxPreparation business, increased personnel costs primarily related to additional headcount, consulting costs and costs incurred in connection with ourtransition to a new clearing firm, which was completed in the third quarter of 2018, higher educational development expenses for our Wealth Managementadvisors and personnel costs primarily related to increases in headcount, offset by the reclassification of certain regulatory fees following the adoption ofASC 606.Year ended December 31, 2017 compared with year ended December 31, 2016Sales and marketing expenses increased primarily due to a $7.8 million increase in marketing expenses and a $3.8 million increase in personnelexpenses. The increase in marketing expenses was driven by increased marketing in our Tax Preparation business. Personnel expenses increased primarilydue to the standardization of employee benefits across our business.General and Administrative(In thousands, except percentages)Years ended December 31, 2018 Change 2017 Change 2016General and administrative$60,124 $7,456 $52,668 $5,272 $47,396Percentage of revenue11% 10% 10%General and administrative (“G&A”) expenses consist primarily of personnel expenses (salaries, stock-based compensation, benefits, and otheremployee-related costs), the cost of temporary help and contractors, professional services fees (which include legal, audit, and tax fees), general businessdevelopment and management expenses, occupancy and general office expenses, business taxes, and insurance expenses.Year ended December 31, 2018 compared with year ended December 31, 2017G&A expenses increased primarily due to an increase in consulting expenses primarily related to strategic initiatives, software expenses mainly relatedto security enhancements and personnel costs primarily related to additional headcount.Year ended December 31, 2017 compared with year ended December 31, 201641Table of ContentsG&A expenses increased primarily due to a $4.9 million net increase in personnel expenses, mainly related to Strategic Transformation Costs and costsassociated with leadership changes at HD Vest, offset by lower stock-based compensation due to fewer grants in 2017 and higher expense recognized in 2016related to the timing of grants.Depreciation and Amortization of Acquired Intangible Assets(In thousands, except percentages)Years ended December 31, 2018 Change 2017 Change 2016Depreciation$4,468 $1,008 $3,460 $(421) $3,881Amortization of acquired intangible assets33,487 (320) 33,807 476 33,331Total$37,955 $688 $37,267 $55 $37,212Percentage of revenue7% 7% 8%Depreciation of property and equipment includes depreciation of computer equipment and software, office equipment and furniture, and leaseholdimprovements not recognized in cost of revenue. Amortization of acquired intangible assets primarily includes the amortization of customer relationships,which are amortized over their estimated lives.Year ended December 31, 2018 compared with year ended December 31, 2017Depreciation expense increased primarily due to the abandonment of certain internally-developed software fixed assets in 2018.Year ended December 31, 2017 compared with year ended December 31, 2016Depreciation and amortization expenses were substantially the same compared to the prior year.Restructuring(In thousands, except percentages)Years ended December 31, 2018 Change 2017 Change 2016Restructuring$288 $(2,813) $3,101 $(769) $3,870Percentage of revenue—% 1% 1%In connection with the Strategic Transformation, including the 2017 relocation of our headquarters, we have incurred restructuring costs ofapproximately $7.3 million, which includes all costs associated with our non-cancelable operating lease for our former corporate headquarters in Bellevue.While the relocation and the related costs were substantially completed by June 2017, the Company incurred some costs in the year ended December 31,2018, primarily related to employees who continued to provide service during a portion of 2018.See "Note 6: Restructuring" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additional information on restructuring.Other Loss, Net(In thousands)Years ended December 31, 2018 Change 2017 Change 2016Interest expense$15,610 $(5,601) $21,211 $(11,213) $32,424Loss on debt extinguishment and amortizationof debt issuance costs2,367 (19,167) 21,534 18,658 2,876Accretion of debt discounts163 (1,784) 1,947 (2,743) 4,690Interest income(349) (239) (110) (29) (81)Other(1,994) (1,963) (31) 97 (128)Other loss, net$15,797 $(28,754) $44,551 $4,770 $39,78142Table of ContentsYear ended December 31, 2018 compared with year ended December 31, 2017The decrease in interest expense relates to lower balances in the Blucora senior secured credit facilities following several prepayments, and therepricing and lowering, in November 2017, of the applicable interest rate margin of the Blucora senior secured credit facilities to 3.0% for Eurodollar Rateloans and 2.0% for ABR loans. See "Note 10: Debt" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additionalinformation.For the year ended December 31, 2017 we had a loss on debt extinguishment related to the prepayment of a portion of the credit facility previouslyentered into in 2015 for the purpose of financing the HD Vest acquisition (the "TaxAct - HD Vest 2015 credit facility"). In connection with the refinancingthrough the Blucora senior secured credit facilities that was entered into in May 2017, we paid-off the remaining TaxAct - HD Vest 2015 credit facility andwrote-off the remaining unamortized debt discount and issuance costs.The decrease in other primarily related to a $2.1 million gain on the sale of an investment in 2018.Year ended December 31, 2017 compared with year ended December 31, 2016The changes in interest expense, loss on debt extinguishment, amortization of debt issuance costs, and accretion of debt discounts primarily related tolower balances in the TaxAct - HD Vest 2015 credit facility and our formerly outstanding Convertible Senior Notes ("the Notes") due to prepayments on aportion of the TaxAct - HD Vest 2015 credit facility in 2017 and 2016 and the redemption of all of the Notes in the second quarter of 2017. In 2017, theapplicable interest rate margin of the Blucora senior secured credit facilities was repriced and lowered to 3.0% for Eurodollar Rate loans and 2.0% for ABRloans.The gain on third party bankruptcy settlement related to amounts received in connection with ongoing distributions from the Lehman Brothers estate,of which we are a creditor.See "Note 10: Debt" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additional information on the "Loss on debtextinguishment and modification expense."Income TaxesDuring 2018, we recorded income tax expense of $0.3 million. Our effective income tax rate differed from the 21% statutory rate in 2018 primarily dueto the recognition of previously reserved net operating losses to offset current income tax expense, and the effect of state income taxes. We currently expectto continue to release portions of valuation allowances, which were previously recorded in connection with our net operating losses, to offset future federalincome tax liabilities. The majority of these net operating losses will expire, if unutilized, between 2020 and 2024.During 2017, we recorded an income tax benefit of $25.9 million. Income tax differed from taxes at the statutory rates primarily due to the January 1,2017 implementation of Accounting Standards Update ("ASU") 2016-09 on stock-based compensation (see "Note 2: Summary of Significant AccountingPolicies" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additional information) and the impact of "H.R. 1", formerlyknown as the Tax Cuts and Jobs Act (the "Tax Legislation"), which President Donald Trump signed into law on December 22, 2017.The Tax Legislation, which was effective January 1, 2018, significantly revised the U.S. tax code by, among other things, lowering the corporateincome tax rate from 35% to 21%. As a result of the reduction in the corporate income tax rate, we re-valued our net deferred tax liabilities during the yearended December 31, 2017. The re-measurement of our deferred tax assets and liabilities resulted in a reduction in the value of our net deferred tax liabilitiesof approximately $21.4 million, which was recorded as additional income tax benefit in 2017.The Tax Legislation also repealed corporate alternative minimum tax ("AMT") for tax years beginning January 1, 2018 and provides that existingAMT credit carryovers are refundable beginning in 2018. We have approximately $10.9 million of AMT credit carryovers that are expected to be fullyrefunded by 2022. Additionally, the Tax Legislation made amendments to Section I.R.C. 162(m) of the Code related to the deductibility of certaincompensation of executive officers, which may limit the total amount of compensation expense that may be deductible by the Company in future years.At December 31, 2018, we had gross temporary differences representing future tax deductions of $628.9 million, which represented deferred tax assetsprimarily comprised of $454.3 million of federal net operating loss carryforwards. We have applied a valuation allowance against the net operating losscarryforwards and certain other deferred tax assets. If in the future,43Table of Contentswe determine that any additional portion of the deferred tax assets is more likely than not to be realized, we will record a benefit to the income statement. Wecurrently estimate that approximately $174.7 million and $132.1 million of federal net operating loss carryforwards will expire in 2020 and 2021,respectively.During 2016, we recorded an income tax benefit of $1.3 million. Income tax differed from taxes at the statutory rates primarily due to the domesticmanufacturing deduction, offset by non-deductible compensation and state income taxes.Discontinued Operations, Net of Income Taxes(In thousands)Years ended December 31, 2018 Change 2017 Change 2016Discontinued operations, net of income taxes$— $— $— $63,121 $(63,121)2016 discontinued operations reflects our former Search and Content and E-Commerce businesses, which were both sold in 2016. See "Note 5:Discontinued Operations" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additional information on discontinuedoperations.NON-GAAP FINANCIAL MEASURESAdjusted EBITDA: We define Adjusted EBITDA as net income (loss) attributable to Blucora, Inc., determined in accordance with GAAP, excluding theeffects of stock-based compensation, depreciation and amortization of acquired intangible assets (including acquired technology), restructuring, other loss,net, the impact of noncontrolling interests, income tax expense (benefit), the effects of discontinued operations, net of income taxes, and acquisition-relatedcosts. For purposes of this definition, restructuring costs relate to the move of our corporate headquarters in 2017 and acquisition-related costs includeprofessional services fees and other direct transaction costs and changes in the fair value of contingent consideration liabilities related to acquiredcompanies. The SimpleTax acquisition that was completed in 2015 included contingent consideration, for which the fair value of that liability was revaluedin the second quarter of 2016. For further detail, see "Note 10: Debt" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.We believe that Adjusted EBITDA provides meaningful supplemental information regarding our performance. We use this non-GAAP financial measurefor internal management and compensation purposes, when publicly providing guidance on possible future results, and as a means to evaluate period-to-period comparisons. We believe that Adjusted EBITDA is a common measure used by investors and analysts to evaluate our performance, that it provides amore complete understanding of the results of operations and trends affecting our business when viewed together with GAAP results, and that managementand investors benefit from referring to this non-GAAP financial measure. Items excluded from Adjusted EBITDA are significant and necessary components tothe operations of our business and, therefore, Adjusted EBITDA should be considered as a supplement to, and not as a substitute for or superior to, GAAP netincome (loss). Other companies may calculate Adjusted EBITDA differently and, therefore, our Adjusted EBITDA may not be comparable to similarly titledmeasures of other companies. A reconciliation of our Adjusted EBITDA to net income (loss) attributable to Blucora, Inc., which we believe to be the mostcomparable GAAP measure, is presented below:(In thousands)Years ended December 31, 201820172016Net income (loss) attributable to Blucora, Inc.$50,634 $27,039 $(65,158)Stock-based compensation13,253 11,653 14,128Depreciation and amortization of acquired intangible assets38,590 38,139 38,688Restructuring288 3,101 3,870Other loss, net15,797 44,551 39,781Net income attributable to noncontrolling interests935 2,337 658Income tax expense (benefit)311 (25,890) (1,285)Discontinued operations, net of income taxes— — 63,121Acquisition-related costs— — 391Adjusted EBITDA$119,808 $100,930 $94,19444Table of ContentsYear ended December 31, 2018 compared with year ended December 31, 2017The increase in Adjusted EBITDA was primarily due to increases in segment operating income of $2.1 million and $14.3 million related to our WealthManagement and Tax Preparation segments, respectively, and a $2.4 million decrease in corporate operating expenses.Year ended December 31, 2017 compared with year ended December 31, 2016The increase in Adjusted EBITDA primarily was due to increases in segment operating income of $4.6 million and $6.0 million related to our WealthManagement and Tax Preparation segments, respectively. Offsetting the increase was a $3.9 million increase in corporate operating expenses primarilyrelated to costs incurred as part of our Strategic Transformation, which related to the relocation cost of our corporate headquarters, and costs associated withtransitioning of roles such as overlap in staffing and recruiting search fees.Non-GAAP net income and non-GAAP net income per share: We define non-GAAP net income as net income (loss) attributable to Blucora, Inc.,determined in accordance with GAAP, excluding the effects of discontinued operations, net of income taxes, stock-based compensation, amortization ofacquired intangible assets (including acquired technology), accelerated accretion of debt discount on the Notes, gain on the Notes repurchased, accretion andwrite-off of debt discount and debt issuance costs on previous debt, acquisition-related costs, restructuring costs, the impact of noncontrolling interests, therelated cash tax impact of those adjustments, and non-cash income taxes. The write-off of debt discount and debt issuance costs on the terminated Notes andthe closed TaxAct - HD Vest 2015 credit facility relates to the debt refinancing that occurred in the second quarter of 2017. We exclude the non-cash portionof income taxes because of our ability to offset a substantial portion of our cash tax liabilities by using deferred tax assets, which primarily consist of U.S.federal net operating losses. The majority of these net operating losses will expire, if unutilized, between 2020 and 2024.We believe that non-GAAP net income and non-GAAP net income per share provide meaningful supplemental information to management, investors,and analysts regarding our performance and the valuation of our business by excluding items in the statement of operations that we do not consider part ofour ongoing operations or have not been, or are not expected to be, settled in cash. Additionally, we believe that non-GAAP net income and non-GAAP netincome per share are common measures used by investors and analysts to evaluate our performance and the valuation of our business. Non-GAAP net incomeand non-GAAP net income per share should be evaluated in light of our financial results prepared in accordance with GAAP and should be considered as asupplement to, and not as a substitute for or superior to, GAAP net income (loss) and GAAP net income (loss) per share. Other companies may calculate thesenon-GAAP measures differently, and, therefore, our non-GAAP net income and non-GAAP net income per share may not be comparable to similarly titledmeasures of other companies. Reconciliation of our non-GAAP net income and non-GAAP net income per share to net income (loss) attributable to Blucora,Inc. and net income (loss) per share attributable to Blucora, Inc., respectively, which we believe to be the most comparable GAAP measures, is presentedbelow:(In thousands, except per share amounts)Years ended December 31, 2018 2017 2016Net income (loss) attributable to Blucora, Inc.$50,634 $27,039 $(65,158)Discontinued operations, net of income taxes— — 63,121Stock-based compensation13,253 11,653 14,128Amortization of acquired intangible assets33,586 34,002 34,143Accelerated accretion of debt discount on Convertible Senior Notes— — 1,628Gain on the Convertible Senior Notes repurchased— — (7,724)Accretion and write-off of debt discount and debt issuance costs on previous debt— 17,875 3,666Acquisition-related costs— — 391Restructuring288 3,101 3,870Impact of noncontrolling interests935 2,337 658Cash tax impact of adjustments to GAAP net income(2,257) (6) 175Non-cash income tax benefit(2,403) (26,853) (3,802)Non-GAAP net income$94,036 $69,148 $45,09645Table of ContentsPer diluted share: Net income (loss) attributable to Blucora, Inc. (1)$0.90 $0.57 $(1.53)Discontinued operations, net of income taxes— — 1.48Stock-based compensation0.27 0.25 0.33Amortization of acquired intangible assets0.68 0.72 0.80Accelerated accretion of debt discount on Convertible Senior Notes— — 0.04Gain on Convertible Senior Notes repurchased— — (0.18)Accretion and write-off of debt discount and debt issuance costs on previous debt— 0.37 0.09Acquisition-related costs— — 0.01Restructuring0.01 0.07 0.09Impacts of noncontrolling interests0.14 0.05 0.02Cash tax impact of adjustments to GAAP net income(0.05) 0.00 0.00Non-cash income tax benefit(0.05) (0.57) (0.09)Non-GAAP net income$1.90 $1.46 $1.06Weighted average shares outstanding used in computing per diluted share amounts49,381 47,211 42,686(1) Any difference in "per diluted share" between this table and the consolidated statements of comprehensive income is due to using different weightedaverage shares outstanding in the event that there is GAAP net loss but non-GAAP net income and vice versa.Year ended December 31, 2018 compared with year ended December 31, 2017The increase in non-GAAP net income was primarily due to increases in segment operating income of $2.1 million and $14.3 million related to ourWealth Management and Tax Preparation segments, respectively, a $7.6 million decrease in interest expense, amortization of debt issuance costs, andaccretion of debt discounts, primarily relating to lower balances in the Blucora senior secured credit facilities and the repricing and lowering, in 2017, of theapplicable interest rate margin of the Blucora senior secured credit facilities. Further contributing to the increase in non-GAAP net income was a $1.0 milliondecrease on debt extinguishment on the Blucora senior secured credit facilities, a $2.4 million decrease in corporate operating expenses not allocated to thesegments and a $2.1 million gain on the sale of an investment. These increases were offset by a $4.0 million increase in cash income tax expense, primarilydue to lower income tax expense and lower debt extinguishment in 2018.Year ended December 31, 2017 compared with year ended December 31, 2016The increase in non-GAAP net income primarily was due to increases in segment operating income of $4.6 million and $6.0 million related to ourWealth Management and Tax Preparation segments, respectively. The increase in non-GAAP net income was also due to (i) a $12.6 million decrease ininterest expense, amortization of debt issuance costs, and accretion of debt discounts, mainly related to the TaxAct - HD Vest 2015 credit facility, which wasentered into in December 2015 and terminated in the second quarter of 2017, (ii) a $3.0 million loss on debt extinguishment and modification expense,mainly related to the prepayment of a portion of the TaxAct - HD Vest 2015 credit facility in 2016, (iii) a $0.4 million decrease in depreciation expense,mainly related to depreciation expense on HD Vest fixed assets, and (iv) a $1.4 million decrease in cash income tax expense, mainly related to the addition ofHD Vest. These increases were offset by a $3.9 million increase in corporate operating expenses not allocated to the segments primarily related to costsincurred as part of our Strategic Transformation, which related to the relocation cost of our corporate headquarters, and costs associated with transitioning ofroles such as overlap in staffing and recruiting search fees.LIQUIDITY AND CAPITAL RESOURCESCash and Cash EquivalentsOur principal source of liquidity is our cash and cash equivalents. As of December 31, 2018, we had cash and cash equivalents of $84.5 million. Our HDVest broker-dealer subsidiary operates in a highly regulated industry and is subject to various regulatory capital requirements. Failure to meet minimumcapital requirements can initiate certain mandatory and possible additional discretionary actions by regulators that, if undertaken, could have substantialmonetary and non-monetary46Table of Contentsimpacts on HD Vest's operations. As of December 31, 2018, HD Vest met all capital adequacy requirements to which it was subject.We generally invest our excess cash in high quality marketable investments. Recently these investments have included money market funds investedin securities issued by agencies of the U.S. We may invest, from time-to-time, in other vehicles, such as debt instruments issued by the U.S. federalgovernment and its agencies, international governments, municipalities and publicly-held corporations, as well as commercial paper, and insured timedeposits with commercial banks. Specific holdings can vary from period to period depending upon our cash requirements. Our financial instrumentinvestments held at December 31, 2018 had minimal default risk and short-term maturities.Historically, we have financed our operations primarily from cash provided by operating activities. Accordingly, we believe that the cash generatedfrom our operations and the cash and cash equivalents we have on hand will be sufficient to meet our operating, working capital, regulatory capitalrequirements at our broker-dealer subsidiary, and capital expenditure requirements for at least the next 12 months. However, the underlying levels ofrevenues and expenses that we project may not prove to be accurate and we may be required to draw on our $50.0 million revolving credit facility to meet ourcapitalrequirements. For further discussion of the risks to our business related to liquidity, see the paragraph in our Risk Factors (Part I Item 1A of this report) underthe heading "Existing cash and cash equivalents, and cash generated from operations may not be sufficient to meet our anticipated cash needs for servicingdebt, working capital, and capital expenditures."Use of CashWe may use our cash and cash equivalents balance in the future on investment in our current businesses, for repayment of debt, for acquiring companiesor assets that complement our Wealth Management and Tax Preparation businesses, for stock buybacks, for returning capital to stockholders, or for otherutilizations which we deem to be in the best interests of stockholders.In May 2017, we entered into a credit agreement with a syndicate of lenders for the Blucora senior secured credit facilities in order to (a) refinance theTaxAct - HD Vest 2015 credit facility, (b) redeem our convertible notes that were outstanding at the time, and (c) provide a term loan and revolving line ofcredit for future working capital, capital expenditure and general business purposes. Consequently, the TaxAct - HD Vest 2015 credit facility was repaid infull with borrowings under the Blucora senior secured credit facilities and the commitments thereunder were terminated. The Blucora senior secured creditfacilities in the aggregate committed amount of $425.0 million consist of a committed $50.0 million revolving credit facility (including a letter of credit sub-facility), and a $375.0 million term loan facility. The final maturity dates of the revolving credit loan and term loan are May 22, 2022 and May 22, 2024,respectively. In November 2017, the credit facility agreement was amended in order to refinance and reprice the initial term loan, such that the applicableinterest rate margin is 3.00% for Eurodollar Rate loans and 2.00% for ABR loans. Depending on Blucora’s Consolidated First Lien Net Leverage Ratio (asdefined in the credit facility agreement), the applicable interest rate margin on the revolving credit facility is from 2.75% to 3.00% for Eurodollar Rate loansand 1.75% to 2.00% for ABR loans. Obligations under the Blucora senior secured credit facilities are guaranteed by certain of Blucora's subsidiaries andsecured by the assets of Blucora and those subsidiaries.The Blucora senior secured credit facilities include financial and operating covenants with respect to certain ratios, including a net leverage ratio, whichare defined further in the credit facility agreement. We were in compliance with these covenants as of December 31, 2018. We initially borrowed $375.0million under the term loan and have made prepayments of $110.0 million towards the term loan since entering into the agreement, of which $80.0 millionwas prepaid in the year ended December 31, 2018, such that $265.0 million was outstanding under the term loan at December 31, 2018. We have notborrowed any amounts under the revolving credit loan and do not have any other debt outstanding. Beginning with the fiscal year ending December 31,2018, we may be required to make annual prepayments of the term loan in an amount equal to a percentage of our excess cash flow during the applicablefiscal year from 0% to 50%, depending on the Consolidated First Lien Net Leverage Ratio (as defined in the credit facility agreement) for such fiscal year. Anexcess cash flow payment will not be required for the fiscal year ending 2018. In the past we have used excess cash flows to make debt prepayments, and wecurrently expect to make further prepayments in 2019. For further detail, see "Note 10: Debt" of the Notes to Consolidated Financial Statements in Part IIItem 8 of this report.Related to the TaxAct - HD Vest 2015 credit facility, we had repayment activity of $64.0 million during the year ended December 31, 2017 prior to therefinancing.On July 2, 2015, TaxAct acquired SimpleTax, which included additional consideration of up to C$4.6 million (with C$ indicating Canadian dollarsand amounting to approximately $3.7 million based on the acquisition-date exchange rate). The related payments are contingent upon product availabilityand revenue performance over a three-year period and are expected47Table of Contentsto occur annually over that period. The first two payments of $1.3 million and $0.9 million were made in the first quarters of 2018 and 2017, respectively,and the remaining payment of $1.3 million is expected in the first quarter of 2019. For further detail, see "Note 8: Fair Value Measurements" of the Notes toConsolidated Financial Statements in Part II Item 8 of this report.On October 14, 2015, we announced our Strategic Transformation, which refers to our transformation into a technology-enabled financial solutionscompany comprised of TaxAct and HD Vest, the divestitures of our Search and Content and E-Commerce businesses, and the relocation of corporateheadquarters from Bellevue, Washington to Irving, Texas. See the "Strategic Transformation" subsection in Part I Item 1 for additional detail regarding therelated use of cash.Related to the acquisition of HD Vest, we paid $613.7 million (after a $1.8 million working capital adjustment in the first quarter of 2016) in cash,which was funded by a combination of cash on hand and the TaxAct - HD Vest 2015 credit facility. For further detail, see "Note 4: Business Combinations"and "Note 10: Debt" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.In connection with the HD Vest acquisition, former management of that business has retained an ownership interest in HD Vest. We are party to put andcall arrangements, exercisable beginning in 2019, with respect to those interests. These put and call arrangements allow former HD Vest management torequire us to purchase their interests or allow us to acquire such interests, respectively. The redemption amount at December 31, 2018 and December 31, 2017was $24.9 million and $12.4 million, respectively. We expect the December 31, 2018 redemption amount will be paid in 2019, and our cash and cashequivalents balance will decrease by $24.9 million.Contractual Obligations and CommitmentsOur contractual obligations and commitments are as follows for years ending December 31:(In thousands)2019 2020 2021 2022 2023 Thereafter TotalOperating lease commitments: Operating lease obligations$3,759 $3,461 $2,245 $1,979 $1,677 $— $13,121Sublease income(1,288) (991) — — — — (2,279)Net operating lease commitments2,471 2,470 2,245 1,979 1,677 — 10,842Purchase commitments10,088 7,311 5,640 4,077 2,444 3,325 32,885Debt commitments— — — — — 265,000 265,000Interest payable11,654 11,686 11,654 11,654 11,654 4,854 63,156Acquisition-related contingentconsideration liability1,275 — — — — — 1,275Total$25,488 $21,467 $19,539 $17,710 $15,775 $273,179 $373,158For further detail see "Note 11: Commitments and Contingencies" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.Off-balance Sheet ArrangementsWe have no off-balance sheet arrangements, other than operating leases.Unrecognized Tax BenefitsThe above table does not reflect unrecognized tax benefits of approximately $4.7 million, the timing of which is uncertain. For additional discussionon unrecognized tax benefits see "Note 16: Income Taxes" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.48Table of ContentsCash FlowsOur cash flows were comprised of the following:(In thousands)Years ended December 31, 2018 2017 2016Net cash provided by operating activities$105,548 $72,846 $85,970Net cash provided (used) by investing activities(7,633) 2,053 (1,560)Net cash used by financing activities(74,804) (68,562) (162,001)Net cash provided (used) by continuing operations23,111 6,337 (77,591)Net cash provided by discontinued operations— 1,028 72,655Effect of exchange rate changes on cash and cash equivalents(56) 78 (26)Net increase (decrease) in cash and cash equivalents$23,055 $7,443 $(4,962)Net cash from operating activities: Net cash from the operating activities of continuing operations consists of income (loss) from continuingoperations, offset by certain non-cash adjustments, and changes in our working capital.Net cash provided by operating activities was $105.5 million, $72.8 million, and $86.0 million for the years ended December 31, 2018, 2017, and2016, respectively. The activity in 2018 included a $2.6 million working capital contribution and approximately $103.0 million of income from continuingoperations (offset by non-cash adjustments). The working capital contribution was primarily driven by clearing firm conversion incentives and the timing ofaccruals.The activity in 2017 included a $(15.3) million working capital contribution and approximately $88.1 million of income from continuing operations(offset by non-cash adjustments). The working capital contribution was driven by accrued expenses, including accrued interest, and the expected realization(through 2022) of $10.9 million of repealed corporate AMT credit carryovers, and restructuring activities.The activity in 2016 included a $44.8 million working capital contribution and approximately $41.2 million of non-cash adjustments and a loss fromcontinuing operations. The working capital contribution was driven by accrued expenses and the impact of excess tax benefits from stock-based activityprimarily due to utilizing equity net operating loss carryforwards from prior years. In addition, we had placed into escrow $20.0 million of additionalconsideration that was contingent upon HD Vest's 2015 earnings performance, and that amount was returned to us in the first quarter of 2016 since it was notachieved (see "Note 4: Business Combinations" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for additional information).Lastly, the timing of TaxAct's spending on marketing campaigns and the addition of HD Vest provided further working capital contribution during theperiod.Net cash from investing activities: Net cash from the investing activities of continuing operations primarily consists of cash outlays for businessacquisitions, transactions (purchases of and proceeds from sales and maturities) related to our investments, and purchases of property and equipment. Ourinvesting activities tend to fluctuate from period-to-period primarily based upon the level of acquisition activity.Net cash provided (used) by investing activities was $(7.6) million, $2.1 million, and $(1.6) million for the years ended December 31, 2018, 2017, and2016, respectively. The activity in 2018 consisted of $7.6 million in purchases of property and equipment. The activity in 2017 primarily consisted of netcash inflows on our available-for-sale investments of $7.1 million offset by $5.0 million in purchases of property and equipment. The activity in 2016primarily consisted of $3.8 million in purchases of property and equipment and payment of the $1.8 million final working capital adjustment on the HD Vestacquisition, offset by net cash inflows on our available-for-sale investments of $4.0 million.Net cash from financing activities: Net cash from the financing activities of continuing operations primarily consists of transactions related to theissuance of debt and stock. Our financing activities tend to fluctuate from period-to-period based upon our financing needs.Net cash used by financing activities was $(74.8) million, $(68.6) million, and $(162.0) million for the years ended December 31, 2018, 2017, and2016, respectively.The activity in 2018 primarily consisted of prepayments of $80.0 million towards the term loan under the Blucora senior secured credit facilities, $8.4million in tax payments from shares withheld for equity awards, and $1.3 million in contingent49Table of Contentsconsideration paid related to the 2015 acquisition of SimpleTax. These cash outflows were offset by approximately $14.9 million in combined proceeds fromthe issuance of common stock related to stock option exercises and the employee stock purchase plan.The activity in 2017 primarily consisted of payments of $290.0 million in connection with the termination of the TaxAct - HD Vest credit facility,$172.8 million for redemption in full of the outstanding Notes, $9.1 million in tax payments from shares withheld for equity awards, payment of $3.2 millionon a related party note payable with the former President of HD Vest that arose in connection with the HD Vest acquisition, and $0.9 million in contingentconsideration paid related to the 2015 acquisition of SimpleTax. These cash outflows were offset by approximately $365.8 million in proceeds from theBlucora senior secured credit facilities that was entered into in May 2017 and $41.7 million in combined proceeds from the issuance of common stock relatedto stock option exercises and the employee stock purchase plan.Net cash used by financing activities was $162.0 million for the year ended December 31, 2016. The activity in 2016 primarily consisted of paymentsof $140.0 million on the TaxAct - HD Vest 2015 credit facility, the $20.7 million repurchase of the Notes, payment of $3.2 million on the note payable withrelated party, and $1.8 million in tax payments from shares withheld for equity awards. These cash outflows were offset by approximately $16.0 million inexcess tax benefits from stock-based award activity primarily due to utilizing equity net operating loss carryforwards from prior years and $3.6 million incombined proceeds from the issuance of common stock related to stock option exercises and the employee stock purchase plan.Critical Accounting Policies and EstimatesThis Management’s Discussion and Analysis of Financial Condition and Results of Operations and the disclosures included elsewhere in this AnnualReport on Form 10-K are based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of thesefinancial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and disclosure ofcontingencies. In some cases, we could have reasonably used different accounting policies and estimates.The SEC has defined a company’s most critical accounting policies as the ones that are the most important to the portrayal of the company’s financialcondition and results of operations and which require the company to make its most difficult and subjective judgments, often as a result of the need to makeestimates of matters that are inherently uncertain. On an ongoing basis, we evaluate the estimates used. We base our estimates on historical experience,current conditions, and on various other assumptions that we believe to be reasonable under the circumstances and, based on information available to us atthat time, we make judgments about the carrying values of assets and liabilities that are not readily apparent from other sources as well as identify and assessour accounting treatment with respect to commitments and contingencies. Actual results may differ significantly from these estimates under differentassumptions, judgments, or conditions. We believe the following critical accounting policies involve the more significant judgments and estimates used inthe preparation of our consolidated financial statements.Wealth management revenue recognition: Wealth management revenue consists primarily of commission revenue, advisory revenue, asset-basedrevenue, and transaction and fee revenue. Revenue is recognized upon the transfer of services to customers in an amount that reflects the consideration towhich we expect to be entitled in exchange for those services. Payments received in advance of the performance of service are deferred and recognized asrevenue when earned. Within the components of Wealth management revenue, commissions revenue is determined through the use of subjective judgmentsand the use of estimates.Commissions represent amounts generated by HD Vest's financial advisors for their clients' purchases and sales of securities and various investmentproducts. We generate two types of commissions: transaction-based sales commissions that occur at the point of sale, as well as trailing commissions forwhich we provide ongoing account support to clients of our financial advisors.Transaction-based sales commission revenue is recorded on a trade-date basis, which is when our performance obligations in generating thecommissions have been substantially completed. Trailing commission revenue is based on a percentage of the current market value of clients' investmentholdings in trail-eligible assets and recognized over the period during which services are performed. Since trailing commission revenue is generally paid inarrears, we estimate it based on a number of factors, including market levels and the amount of trailing commission revenues received in prior periods, andalso considers historical payout ratios. These estimates are primarily based on historical information and there is not significant judgment involved.50Table of ContentsA substantial portion of commission revenue is ultimately paid to financial advisors. Such amounts are recorded as "Commissions and advisory feespayable" on the consolidated balance sheets and "Wealth management services cost of revenue" on the consolidated statements of comprehensive income.Tax preparation revenue recognition: We derive revenue from the sale of tax preparation digital services, ancillary services, packaged tax preparationsoftware, and multiple element arrangements that may include a combination of these items. Ancillary services primarily include tax preparation supportservices, and e-filing services. The Company recognizes revenue from the sale of its packaged software when legal title transfers. Legal title transfersgenerally when its customers download the software from the Internet or, in some cases, when the software ships. Within the components of tax preparationrevenue, revenues from bank or reloadable prepaid debit card services and software and/or services that consist of multiple elements are determined throughthe use of subjective judgments and the use of estimates.The bank or reloadable prepaid debit card services are offered to taxpayers as an option to receive their tax refunds in the form of a prepaid bank card orto have the fees for the software and/or services purchased by the customers deducted from their refunds. Other value-added service revenue consists ofrevenue from revenue sharing and royalty arrangements with third party partners. Revenue for these transactions is recognized when the revenue recognitioncriteria are met; for some arrangements that is upon filing and for other arrangements that is upon our determination of when collectibility is probable.For software and/or services that consist of multiple elements, we must: (1) determine whether and when each element has been delivered; (2) determinethe fair value of each element; and (3) allocate the total price among the various elements based on the relative selling price method. Once we have allocatedthe total price among the various elements, we recognize revenue when the revenue recognition criteria described above are met for each element. The impactof multiple element arrangements is not material and primarily impacts the timing of revenue recognition over the tax filing season, which is concentratedwithin the first two quarters of the filing period.Income taxes: We account for income taxes under the asset and liability method, under which deferred tax assets, including net operating losscarryforwards, and liabilities are determined based on temporary differences between the book and tax bases of assets and liabilities. We periodically evaluatethe likelihood of the realization of deferred tax assets and reduce the carrying amount of the deferred tax assets by a valuation allowance to the extent webelieve a portion will not be realized. We consider many factors when assessing the likelihood of future realization of the deferred tax assets, includingexpectations of future taxable income, recent cumulative earnings experience by taxing jurisdiction, and other relevant factors. There is a wide range ofpossible judgments relating to the valuation of our deferred tax assets.We record liabilities to address uncertain tax positions that have been taken in previously filed tax returns or that are expected to be taken in a futuretax return. The determination for required liabilities is based upon an analysis of each individual tax position, taking into consideration whether it is morelikely than not that the tax position, based on technical merits, will be sustained upon examination. The tax benefit to be recognized in the financialstatements from such a position is measured as the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlementwith the taxing authority. The difference between the amount recognized and the total tax position is recorded as a liability. The ultimate resolution of thesetax positions may be greater or less than the liabilities recorded.Recent Accounting PronouncementsSee "Note 2: Summary of Significant Accounting Policies" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.51Table of ContentsQuarterly Results of Operations (Unaudited)The following table presents a summary of our unaudited consolidated results of operations for the eight quarters ended December 31, 2018. Theinformation for each of these quarters has been prepared on a basis consistent with our annual audited consolidated financial statements. You should read thisinformation in conjunction with our consolidated financial statements and notes thereto in Part II Item 8. The operating results for any quarter are notnecessarily indicative of results for any future period. March 31, 2017 June 30, 2017 September 30, 2017 December 31, 2017 March 31, 2018 June 30, 2018 September 30, 2018 December 31, 2018 (In thousands except per share data and percentages)Revenue: Wealth managementservices revenue$82,667 $85,296 $86,809 $93,848 $92,082 $92,015 $91,887 $97,190Tax preparation servicesrevenue99,708 53,866 3,362 4,001 113,883 65,833 3,498 4,068Total revenue182,375 139,16290,17197,849205,965157,84895,385101,258Operating expenses: Cost of revenue: Wealth managementservices cost of revenue55,874 56,963 59,607 63,415 63,064 62,149 62,313 66,054Tax preparation servicescost of revenue3,818 2,411 1,314 2,475 4,353 2,459 1,370 1,858Amortization of acquiredtechnology48 47 50 50 50 49 — —Total cost of revenue59,740 59,42160,97165,94067,46764,65763,68367,912Engineering andtechnology4,748 4,242 5,051 5,573 5,131 4,848 4,246 5,107Sales and marketing48,998 22,296 13,680 17,824 55,253 23,791 15,675 16,642General and administrative13,483 13,715 12,207 13,263 14,866 15,625 13,404 16,229Depreciation940 873 867 780 1,915 993 798 762Amortization of otheracquired intangible assets8,288 8,289 8,615 8,615 8,307 8,806 8,271 8,103Restructuring (1)2,289 331 106 375 289 2 — (3)Total operating expenses138,486 109,167101,497112,370153,228118,722106,077114,752Operating income (loss)43,889 29,995(11,326)(14,521)52,73739,126(10,692)(13,494)Other loss, net(9,708) (24,200) (5,241) (5,402) (5,228) (2,759) (3,863) (3,947)Income (loss) before incometaxes34,181 5,795(16,567)(19,923)47,50936,367(14,555)(17,441)Income tax benefit (expense)(3,471) (2,315) (166) 31,842 (1,963) (907) 818 1,741Net income (loss)30,710 3,480(16,733)11,91945,54635,460(13,737)(15,700)Net income attributable tononcontrolling interests(126) (176) (164) (1,871) (205) (222) (227) (281)Net income (loss) attributableto Blucora, Inc.$30,584 $3,304 $(16,897) $10,048 $45,341 $35,238 $(13,964) $(15,981)Net income (loss) per share attributable to Blucora, Inc.: Basic$0.73 $0.08 $(0.37) $0.22 $0.97 $0.75 $(0.37) $(0.38)Diluted$0.67 $0.07 $(0.37) $0.21 $0.93 $0.71 $(0.37) $(0.38)Weighted average shares outstanding: Basic42,145 43,644 45,459 46,231 46,641 47,221 47,712 48,002Diluted45,428 46,937 45,459 48,406 48,665 49,434 47,712 48,00252Table of Contents March 31, 2017 June 30, 2017 September 30, 2017 December 31, 2017 March 31, 2018 June 30, 2018 September 30, 2018 December 31, 2018Revenue: Wealth managementservices revenue45.3 % 61.3 % 96.3 % 95.9 % 44.7 % 58.3 % 96.3 % 96.0 %Tax preparation servicesrevenue54.7 38.7 3.7 4.1 55.3 41.7 3.7 4.0Total revenue100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0Operating expenses: Cost of revenue (2): Wealth managementservices cost ofrevenue67.6 66.8 68.7 67.6 68.5 67.5 67.8 68.0Tax preparationservices cost ofrevenue3.8 4.5 39.1 61.9 3.8 3.7 39.2 45.7Amortization ofacquired technology0.0 0.0 0.1 0.1 0.0 0.0 0.0 0.0Total cost of revenue32.8 42.7 67.6 67.4 32.8 41.0 66.8 67.1Engineering andtechnology2.6 3.0 5.6 5.7 2.5 3.1 4.5 5.0Sales and marketing26.9 16.0 15.2 18.2 26.8 15.1 16.4 16.4General andadministrative7.4 9.9 13.5 13.6 7.2 9.9 14.1 16.0Depreciation0.5 0.6 1.0 0.8 0.9 0.6 0.8 0.8Amortization of otheracquired intangibleassets4.5 6.0 9.6 8.8 4.0 5.6 8.7 8.0Restructuring1.3 0.2 0.1 0.4 0.1 — — —Total operatingexpenses76.0 78.4 112.6 114.9 74.3 75.3 111.3 113.3Operating income (loss)24.0 21.6 (12.6) (14.9) 25.7 24.7 (11.3) (13.3)Other loss, net(5.3) (17.4) (5.8) (5.5) (2.5) (1.7) (4.0) (3.9)Income (loss) fromcontinuing operationsbefore income taxes18.7 4.2 (18.4) (20.4) 23.2 23.0 (15.3) (17.2)Income tax benefit(expense)(1.9) (1.7) (0.2) 32.5 (1.0) (0.6) 0.9 1.7Net income (loss)16.8 2.5 (18.6) 12.1 22.2 22.4 (14.4) (15.5)Net income attributable tononcontrolling interests(0.1) (0.1) (0.2) (1.9) (0.1) (0.1) (0.2) (0.3)Net income (loss)attributable to Blucora,Inc.16.7 % 2.4 % (18.8)% 10.2 % 22.1 % 22.3 % (14.6)% (15.8)%(1) In 2017 we relocated our corporate headquarters from Bellevue, Washington to Irving, Texas. In connection with this plan, we incurred restructuringcosts. See "Note 6: Restructuring" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report for more information.(2) "Wealth management services cost of revenue" and "Tax preparation services cost of revenue" are calculated based on their respective revenue bases of"Wealth management services revenue" and "Tax Preparation services revenue," respectively. "Total cost of revenue" is calculated based on "Totalrevenue."53Table of ContentsITEM 7A. Quantitative and Qualitative Disclosures about Market RiskWe are exposed to financial market risks, including changes in the market values of our marketable debt securities and interest rates.Financial market risk: We do not invest in financial instruments or their derivatives for trading or speculative purposes. By policy, we limit our creditexposure to any one issuer, other than securities issued by the U.S. federal government and its agencies, and do not have any derivative instruments in ourinvestment portfolio. The three primary goals that guide our investment decisions, with the first being the most important, are: preserve capital, maintain easeof conversion into immediate liquidity, and achieve a rate of return over a pre-determined benchmark. As of December 31, 2018, we were principally investedin money market fund securities. We consider the market value, default, and liquidity risks of our investments to be low at December 31, 2018.Interest rate risk: At December 31, 2018, our cash equivalent balance of $23.2 million was held in money market funds. We consider the interest raterisk for our cash equivalent securities held at December 31, 2018 to be low. For further detail on our cash equivalents, see "Note 8: Fair Value Measurements"of the Notes to Consolidated Financial Statements in Part II Item 8 of this report.In addition, as of December 31, 2018, we had $265.0 million of debt outstanding under the Blucora senior secured credit facilities, which carries adegree of interest rate risk. This debt has a floating portion of its interest rate tied to the London Interbank Offered Rate (“LIBOR”). For further informationon our outstanding debt, see "Note 10: Debt" of the Notes to Consolidated Financial Statements in Part II Item 8 of this report. A hypothetical 100 basis pointincrease in LIBOR on December 31, 2018 would result in a $14.6 million increase in our interest expense until the scheduled maturity date in 2024.The following table provides information about our cash equivalent securities as of December 31, 2018, including principal cash flows for 2019 andthereafter and the related weighted average interest rates. Principal amounts and weighted average interest rates by expected year of maturity are as follows:(In thousands, except percentages)2019ThereafterTotalFair ValueMoney market and other funds23,181 1.95% — —% 23,181 1.95% 23,181Cash equivalents$23,181 $— $23,181 $23,18154Table of ContentsITEM 8. Financial Statements and Supplementary Data INDEX TO CONSOLIDATED FINANCIAL STATEMENTS PageReport of Independent Registered Public Accounting Firm56Consolidated Balance Sheets57Consolidated Statements of Comprehensive Income (Loss)58Consolidated Statements of Stockholders’ Equity59Consolidated Statements of Cash Flows60Notes to Consolidated Financial Statements6155Table of ContentsREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMTo the Stockholders and the Board of Directors of Blucora, Inc.Opinion on the Financial StatementsWe have audited the accompanying consolidated balance sheets of Blucora, Inc. (the Company) as of December 31, 2018 and 2017, the related consolidatedstatements of comprehensive income (loss), stockholders' equity and cash flows for each of the three years in the period ended December 31, 2018, and therelated notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in allmaterial respects, the financial position of the Company at December 31, 2018 and 2017, and the results of its operations and its cash flows for each of thethree years in the period ended December 31, 2018, in conformity with U.S. generally accepted accounting principles.We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’sinternal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control-Integrated Framework issued by theCommittee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 1, 2019 expressed an unqualifiedopinion thereon.Basis for OpinionThese financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financialstatements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Companyin accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing proceduresto assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also includedevaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financialstatements. We believe that our audits provide a reasonable basis for our opinion./s/ Ernst & Young LLPWe have served as the Company’s auditor since 2012.Dallas, TexasMarch 1, 201956Table of ContentsBLUCORA, INC.CONSOLIDATED BALANCE SHEETS(In thousands, except per share data) December 31, 2018 2017ASSETS Current assets: Cash and cash equivalents$84,524 $59,965Cash segregated under federal or other regulations842 1,371Accounts receivable, net of allowance14,977 10,694Commissions receivable15,562 16,822Other receivables7,408 3,180Prepaid expenses and other current assets, net7,755 7,365Total current assets131,068 99,397Long-term assets: Property and equipment, net12,389 9,831Goodwill, net548,685 549,037Other intangible assets, net294,603 328,205Other long-term assets10,980 15,201Total long-term assets866,657 902,274Total assets$997,725 $1,001,671LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable$3,798 $4,413Commissions and advisory fees payable15,199 17,813Accrued expenses and other current liabilities19,026 19,577Deferred revenue10,257 9,953Total current liabilities48,280 51,756Long-term liabilities: Long-term debt, net260,390 338,081Deferred tax liability, net40,394 43,433Deferred revenue8,581 804Other long-term liabilities7,540 8,177Total long-term liabilities316,905 390,495Total liabilities365,185 442,251 Redeemable noncontrolling interests24,945 18,033 Commitments and contingencies (Note 11) Stockholders’ equity: Common stock, par $0.0001—authorized shares, 900,000; issued and outstanding shares, 48,044 and 46,3665 5Additional paid-in capital1,569,725 1,555,560Accumulated deficit(961,689) (1,014,174)Accumulated other comprehensive loss(446) (4)Total stockholders’ equity607,595 541,387Total liabilities and stockholders’ equity$997,725 $1,001,671See notes to consolidated financial statements.57Table of ContentsBLUCORA, INC.CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)(In thousands, except per share data) Years ended December 31, 2018 2017 2016Revenue: Wealth management services revenue$373,174 $348,620 $316,546Tax preparation services revenue187,282 160,937 139,365Total revenue560,456 509,557 455,911Operating expenses: Cost of revenue: Wealth management services cost of revenue253,580 235,859 213,996Tax preparation services cost of revenue10,040 10,018 8,368Amortization of acquired technology99 195 812Total cost of revenue263,719 246,072 223,176Engineering and technology19,332 19,614 17,780Sales and marketing111,361 102,798 89,360General and administrative60,124 52,668 47,396Depreciation4,468 3,460 3,881Amortization of other acquired intangible assets33,487 33,807 33,331Restructuring288 3,101 3,870Total operating expenses492,779 461,520 418,794Operating income67,677 48,037 37,117Other loss, net(15,797) (44,551) (39,781)Income (loss) from continuing operations before income taxes51,880 3,486 (2,664)Income tax benefit (expense)(311) 25,890 1,285Income (loss) from continuing operations51,569 29,376 (1,379)Discontinued operations, net of income taxes— — (63,121)Net income (loss)51,569 29,376 (64,500)Net income attributable to noncontrolling interests(935) (2,337) (658)Net income (loss) attributable to Blucora, Inc.$50,634 $27,039 $(65,158)Net income (loss) per share attributable to Blucora, Inc. - basic*: Continuing operations$0.94 $0.61 $(0.05)Discontinued operations— — (1.52)Basic net income (loss) per share$0.94 $0.61 $(1.57)Net income (loss) per share attributable to Blucora, Inc. - diluted*: Continuing operations$0.90 $0.57 $(0.05)Discontinued operations— — (1.52)Diluted net income (loss) per share$0.90 $0.57 $(1.57)Weighted average shares outstanding: Basic47,394 44,370 41,494Diluted49,381 47,211 41,494Other comprehensive income (loss): Net income (loss)$51,569 $29,376 $(64,500)Unrealized gain on available-for-sale investments, net of tax— 1 9Foreign currency translation adjustment(442) 376 137Other comprehensive income (loss)(442) 377 146Comprehensive income (loss)51,127 29,753 (64,354)Comprehensive income attributable to noncontrolling interests(935) (2,337) (658)Comprehensive income (loss) attributable to Blucora, Inc.$50,192 $27,416 $(65,012)* The 2018 net income (loss) per share amounts include the noncontrolling interest redemption impact discussed further in "Note 2: Summary of Significant Accounting Policies" andin "Note 17: Net Income (Loss) Per Share."See notes to consolidated financial statements.58Table of ContentsBLUCORA, INC.CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY(In thousands) RedeemableNoncontrollingInterests Additional-paid-incapital Accumulateddeficit Accumulatedothercomprehensiveincome (loss) Common stock Shares Amount TotalBalance as of December 31, 2015$15,038 40,954 $4 $1,490,405 $(1,027,598) $(527) $462,284Common stock issued for stock optionsand restricted stock units— 700 — 2,216 — — 2,216Common stock issued for employee stockpurchase plan— 191 — 1,402 — — 1,402Other comprehensive income— — — — — 146 146Stock-based compensation— — — 15,235 — — 15,235Tax effect of equity compensation— — — 2,461 — — 2,461Tax payments from shares withheld forequity awards— — — (1,752) — — (1,752)Reclassification of equity award toliability award— — — 185 — — 185Net income (loss)658 — — — (65,158) — (65,158)Balance as of December 31, 201615,696 41,845 4 1,510,152 (1,092,756) (381) 417,019Common stock issued for stock optionsand restricted stock units— 4,382 1 40,271 — — 40,272Common stock issued for employee stockpurchase plan— 139 — 1,429 — — 1,429Other comprehensive income— — — — — 377 377Stock-based compensation and impact ofrecent ASU— — — 12,801 51,543 — 64,344Tax payments from shares withheld forequity awards— — — (9,095) — — (9,095)Other— — — 2 — — 2Net income2,337 — — — 27,039 — 27,039Balance as of December 31, 201718,033 46,366 5 1,555,560 (1,014,174) (4) 541,387Common stock issued for stock optionsand restricted stock units— 1,577 — 13,151 — — 13,151Common stock issued for employee stockpurchase plan— 101 — 2,100 — — 2,100Other comprehensive loss— — — — — (442) (442)Stock-based compensation— — — 13,253 — — 13,253Tax payments from shares withheld forequity awards— — — (8,362) — — (8,362)Impact of adoption of new accountingguidance related to revenue recognition— — — — 1,851 — 1,851Net income935 — — — 50,634 — 50,634Adjustment of redeemable noncontrollinginterests to redemption value5,977 — — (5,977) — — (5,977)Balance as of December 31, 2018$24,945 48,044 $5 $1,569,725 $(961,689) $(446) $607,595See notes to consolidated financial statements.59Table of ContentsBLUCORA, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands) Years ended December 31, 2018 2017 2016Operating Activities: Net income (loss)$51,569 $29,376 $(64,500)Less: Discontinued operations, net of income taxes— — (63,121)Net income (loss) from continuing operations51,569 29,376 (1,379)Adjustments to reconcile net income (loss) to net cash from operating activities: Stock-based compensation13,253 11,653 14,128Depreciation and amortization of acquired intangible assets38,590 38,139 38,688Restructuring (non-cash)— 1,569 (364)Deferred income taxes(3,039) (16,159) (18,055)Amortization of premium on investments, net, and debt issuance costs833 1,099 2,014Accretion of debt discounts163 1,947 4,690Loss on debt extinguishment and modification expense1,534 20,445 1,036Revaluation of acquisition-related contingent consideration liability— — 391Other72 30 19Cash provided (used) by changes in operating assets and liabilities: Accounts receivable(4,286) (483) (2,340)Commissions receivable1,260 (678) 184Other receivables(3,851) (204) 22,875Prepaid expenses and other current assets(815) (869) 3,741Other long-term assets3,450 (12,281) (887)Accounts payable(615) (123) (153)Commissions and advisory fees payable(2,614) 1,226 (395)Deferred revenue9,930 (3,248) 582Accrued expenses and other current and long-term liabilities114 1,407 21,195Net cash provided by operating activities105,548 72,846 85,970Investing Activities: Business acquisitions, net of cash acquired— — (1,788)Purchases of property and equipment(7,633) (5,039) (3,812)Proceeds from sales of investments— 249 —Proceeds from maturities of investments— 7,252 12,807Purchases of investments— (409) (8,767)Net cash provided (used) by investing activities(7,633) 2,053 (1,560)Financing Activities: Proceeds from credit facility, net of debt issuance costs and debt discount of $5,913 and $1,875 in2017— 365,836 —Repurchase of convertible notes— (172,827) (20,667)Payments on credit facilities(80,000) (290,000) (140,000)Repayment of note payable with related party— (3,200) (3,200)Proceeds from stock option exercises12,773 40,271 2,216Proceeds from issuance of stock through employee stock purchase plan2,100 1,429 1,402Tax payments from shares withheld for equity awards(8,362) (9,095) (1,752)Contingent consideration payments for business acquisition(1,315) (946) —Other— (30) —Net cash used by financing activities(74,804) (68,562) (162,001)Net cash provided (used) by continuing operations23,111 6,337 (77,591) Net cash provided by operating activities from discontinued operations— — 14,047Net cash provided by investing activities from discontinued operations— 1,028 83,608Net cash used by financing activities from discontinued operations— — (25,000)Net cash provided by discontinued operations— 1,028 72,655 Effect of exchange rate changes on cash and cash equivalents(56) 78 (26)Net increase (decrease) in cash, cash equivalents, and restricted cash23,055 7,443 (4,962)Cash and cash equivalents, beginning of period62,311 54,868 59,830Cash and cash equivalents, end of period$85,366 $62,311 $54,868Non-cash investing and financing activities from continuing operations: Cash paid for income taxes from continuing operations$1,806 $1,267 $2,012Cash paid for interest from continuing operations$15,335 $23,316 $32,377See notes to consolidated financial statements.60Table of ContentsBLUCORA, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTSYears Ended December 31, 2018, 2017, and 2016Note 1: Description of the BusinessBlucora, Inc. (the "Company," "Blucora," "we," "our," or "us") operates two businesses: a Wealth Management business and a digital Tax Preparationbusiness. The Wealth Management business consists of the operations of HDV Holdings, Inc. and its subsidiaries ("HD Vest"). HDV Holdings, Inc. is theparent company of the Wealth Management business and owns all outstanding shares of HD Vest, Inc., which serves as a holding company for the variousfinancial services subsidiaries. Those subsidiaries include HD Vest Investment Securities, Inc. (an introducing broker-dealer), H.D. Vest Advisory Services,Inc. (a registered investment adviser), and H.D. Vest Insurance Agency, LLC (an insurance broker) (collectively referred to as the "Wealth Managementbusiness" or the "Wealth Management segment"). The Tax Preparation business consists of the operations of TaxAct, Inc. and its subsidiary ("TaxAct") andprovides digital tax preparation solutions for consumers, small business owners, and tax professionals through its website www.TaxAct.com (collectivelyreferred to as the "Tax Preparation business" or the "Tax Preparation segment").Prior to 2017, the Company also operated an internet Search and Content business and an E-Commerce business. The Search and Content businessoperated through the InfoSpace LLC subsidiary (“InfoSpace”) and provided search services to users of its owned and operated and distribution partners’ webproperties, as well as online content through HowStuffWorks (“HSW”). The E-Commerce business consisted of the operations of Monoprice, Inc.(“Monoprice”) and sold self-branded electronics and accessories to both consumers and businesses primarily through its website. The Company completedboth divestitures in 2016.The financial condition, results of operations, cash flows, and the notes to financial statements reflect the Search and Content and E-Commercebusinesses as discontinued operations for all periods presented. Except for disclosures related to equity and unless otherwise specified, disclosures in theseconsolidated financial statements reflect continuing operations.In 2015 the Company acquired HD Vest and announced its plans to focus on the technology-enabled financial solutions market (the "StrategicTransformation"). The Strategic Transformation refers to our transformation into a technology-enabled financial solutions company comprised of TaxActand HD Vest and the divestitures of our Search and Content business and our E-Commerce business in 2016. As part of the Strategic Transformation and "OneCompany" operating model, we relocated our corporate headquarters from Bellevue, Washington to Irving, Texas during 2017.In connection with the relocation of our corporate headquarters, we incurred restructuring costs of approximately $7.3 million. These costs are recordedwithin corporate-level activity for segment purposes. See "Note 6: Restructuring" of the Notes to Consolidated Financial Statements in Part II Item 8 of thisreport for additional information. We also have incurred costs that do not qualify for restructuring classification, such as recruiting and overlap in personnelexpenses as we transitioned positions to Texas ("Strategic Transformation Costs").Segments: The Company has two reportable segments: the Wealth Management segment, which is the HD Vest business, and the Tax Preparationsegment, which is the TaxAct business. Unless the context indicates otherwise, the Company uses the term “Wealth Management” to represent services soldthrough the HD Vest business and the term “Tax Preparation” to represent services and software sold through the TaxAct business.Reclassification: The Company reclassified certain amounts on its consolidated statements of cash flows related to excess tax benefits generated fromstock-based compensation and restricted cash, both in connection with the implementation of new accounting pronouncements. See the "Recent accountingpronouncements" section of "Note 2: Summary of Significant Accounting Policies" for additional information.Principles of consolidation: The consolidated financial statements include the accounts of the Company and its subsidiaries. Intercompany accountsand transactions have been eliminated.Use of estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America(“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and disclosureof contingencies. Estimates include those used for impairment of goodwill and other intangible assets, useful lives of other intangible assets, acquisitionaccounting, valuation of investments, revenue recognition, the estimated allowance for sales returns and doubtful accounts, internally developed software,accrued61Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016contingencies, stock option valuation, and valuation allowance for deferred tax assets. Actual amounts may differ from estimates.Net capital and regulatory requirements: The Company's HD Vest broker-dealer subsidiary operates in a highly regulated industry and is subject tovarious regulatory capital requirements. Failure to meet minimum capital requirements can initiate certain mandatory and possible additional discretionaryactions by regulators that, if undertaken, could have substantial monetary and non-monetary impacts to HD Vest's operations. As of December 31, 2018,HD Vest met all capital adequacy requirements to which it was subject.Seasonality: Blucora’s Tax Preparation segment is highly seasonal, with a significant portion of its annual revenue earned in the first four months of theCompany’s fiscal year. During the third and fourth quarters, the Tax Preparation segment typically reports losses because revenue from the segment isminimal while core operating expenses continue.Note 2: Summary of Significant Accounting PoliciesCash, cash equivalents, restricted cash and cash segregated under federal or other regulations: The following table presents cash, cash equivalents,and restricted cash as reported on the consolidated balance sheets that equal the total amounts on the consolidated statements of cash flows (in thousands): December 31, 2018 2017Cash and cash equivalents$84,524 $59,965Cash segregated under federal or other regulations842 1,371Restricted cash included in "Prepaid expenses and other current assets, net"— 425Restricted cash included in "Other long-term assets"— 550Total cash, cash equivalents, and restricted cash$85,366 $62,311Cash segregated under federal and other regulations is held in a separate bank account for the exclusive benefit of the Company’s Wealth Managementcustomers. Restricted cash included in prepaid expenses and other current assets, net and other long-term assets represent amounts pledged as collateral forcertain of the Company's banking and lease arrangements.The Company generally invests its available cash in high quality marketable investments. Recently these investments have included money marketfunds invested in securities issued by agencies of the U.S. government. The Company may invest, from time-to-time, in other vehicles, such as debtinstruments issued by the U.S. federal government and its agencies, international governments, municipalities and publicly-held corporations, as well ascommercial paper, and insured time deposits with commercial banks. Specific holdings can vary from period to period depending upon the Company's cashrequirements. Such investments are reported at fair value on the consolidated balance sheets.Accounts receivable: Accounts receivable are stated at amounts due from customers net of an allowance for doubtful accounts, which was not materialat December 31, 2018 and 2017, respectively.Property and equipment: Property and equipment are stated at cost. Depreciation is computed under the straight-line method over the followingestimated useful lives:Computer equipment and software3 yearsData center servers3 yearsInternally-developed software3 yearsOffice equipment7 yearsOffice furniture7 yearsLeasehold improvementsShorter of lease term or economic life62Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016The Company capitalizes certain internal-use software development costs, consisting primarily of contractor costs and employee salaries and benefitsallocated on a project or product basis. The Company capitalized $6.5 million, $3.5 million, and $1.0 million of internal-use software costs in the yearsended December 31, 2018, 2017, and 2016, respectively.Business combinations and intangible assets including goodwill: The Company accounts for business combinations using the acquisition method. Theacquisition-date fair value of total consideration includes cash and contingent consideration. Since the Company is contractually obligated to paycontingent consideration upon the achievement of specified objectives, a contingent consideration liability is recorded at the acquisition date. The Companyreviews its assumptions related to the fair value of the contingent consideration liability each reporting period and, if there are material changes, revalues thecontingent consideration liability based on the revised assumptions, until such contingency is satisfied through payment upon the achievement of thespecified objectives. The change in the fair value of the contingent consideration liability is recognized in "General and administrative" expense on theconsolidated statements of comprehensive income for the period in which the fair value changes.Goodwill is calculated as the excess of the acquisition-date fair value of total consideration over the acquisition-date fair value of net assets, includingthe amount assigned to identifiable intangible assets, and is assigned to reporting units that are expected to benefit from the synergies of the businesscombination as of the acquisition date. Reporting units are consistent with reportable segments. Identifiable intangible assets with finite lives are amortizedover their useful lives on a straight-line basis, except for advisor relationships which are amortized proportional to expected revenue. Acquisition-relatedcosts, including advisory, legal, accounting, valuation, and other similar costs, are expensed in the periods in which the costs are incurred. The results ofoperations of acquired businesses are included in the consolidated financial statements from the acquisition date.Goodwill and intangible assets impairment: The Company evaluates goodwill and indefinite-lived intangible assets for impairment annually, as ofNovember 30, or more frequently when events or circumstances indicate that impairment may have occurred. The Company performed an assessment as ofNovember 30, 2018, and determined that no conditions existed that would make it more likely than not that goodwill and the indefinite-lived assets wereimpaired.Definite-lived intangible assets are reviewed for impairment when events or circumstances indicate that the carrying value of an asset or group of assetsmay not be recoverable. The determination of recoverability is based on an estimate of pre-tax undiscounted future cash flows, using the Company's bestestimates of future revenues and operating expenses, expected to result from the use and eventual disposition of the asset or group of assets over theremaining economic life of the primary asset in the asset group. The Company measures the amount of the impairment as the excess of the asset's carryingvalue over its fair value.Fair value of financial instruments: The Company measures its cash equivalents and contingent consideration liability at fair value. The Companyconsiders the carrying values of accounts receivable, commissions receivable, other receivables, prepaid expenses, other current assets, accounts payable,commissions and advisory fees payable, accrued expenses, and other current liabilities to approximate fair values primarily due to their short-term natures.The Company has a contingent consideration liability that is related to the Company's 2015 acquisition of SimpleTax Software Inc. ("SimpleTax").The Company's contingent consideration liability is classified within Level 3 (see "Note 8: Fair Value Measurements") of the fair value hierarchy because theCompany values it utilizing significant inputs not observable in the market. Specifically, the Company has determined the fair value of the contingentconsideration liability based on a probability-weighted discounted cash flow analysis, which includes assumptions related to estimating revenues, theprobability of payment, and the discount rate. The change in the fair value of the contingent consideration liability is recognized in "General andadministrative" expense on the consolidated statements of comprehensive income for the period in which the fair value changes. The Company accounts forcontingent consideration in accordance with applicable accounting guidance pertaining to business combinations.Redeemable noncontrolling interests: Noncontrolling interests that are redeemable at the option of the holder and not solely within the control of theissuer are classified outside of stockholders' equity. In connection with the 2015 acquisition of HD Vest, certain members of the former management of HDVest retained an ownership interest in that business. The Company is party to put and call arrangements, exercisable beginning in the first quarter of 2019,with respect to these interests. These put and call arrangements allow certain members of HD Vest management to require the Company to purchase theirinterests or63Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016allow the Company to acquire such interests, respectively. These arrangements can be settled for cash within ninety days after the Company files its AnnualReport on Form 10-K for the year ended December 31, 2018. The redemption value of the arrangements is based upon several factors, including, amongothers, the Company's implied enterprise value, implied equity value and certain financial performance measures of the Company. The put arrangements donot meet the definition of a derivative instrument as the put agreements do not provide for net settlement.To the extent that the redemption value of these interests exceeds the value determined by adjusting the carrying value for the subsidiary's attributionof net income (loss), the value of such interests is adjusted to the redemption value with a corresponding adjustment to additional paid-in capital; thisoccurred in the third quarter of 2018, and the Company recorded an adjustment of approximately $6.0 million for the year ended December 31, 2018. Theredemption amount of noncontrolling interests at December 31, 2018 was $24.9 million.Revenue recognition, general: The Company recognizes revenue when all five revenue recognition criteria have been satisfied: contract(s) withcustomers have been identified, performance obligations have been identified, transaction prices have been determined, transaction prices have beenallocated to the performance obligations, and the performance obligations have been fulfilled by transferring control over the promised services to thecustomer. Determining whether and when these criteria have been satisfied involves judgment, estimates and assumptions that can have an impact on thetiming and amount of revenue that the Company recognizes.Revenue is recognized net of allowances, which are management's estimates of fees to be paid to a third party service provider for fulfillment of theCompany's audit defense services. These fees are not material and generally include an estimate of audit defense fees to be paid, based on an analysis ofhistorical data and contractual terms, and are recorded when revenue is recognized. The Company believes that it can reasonably and reliably estimate fees tothe third party service provider in a timely manner.The Company evaluates whether revenue should be presented on a gross basis, which is the amount that a customer pays for the service or product, oron a net basis, which is the customer payment less amounts the Company pays to suppliers. In making that evaluation, the Company primarily considerswhether it acts as the principal or agent in the transaction and whether it controls the services before they are transferred to customers.Wealth management revenue recognition: Wealth management revenue consists primarily of commission revenue, advisory revenue, asset-basedrevenue, and transaction and fee revenue. Revenue is recognized upon the transfer of services to customers in an amount that reflects the consideration towhich the Company expects to be entitled in exchange for those services. Payments received by the Company in advance of the performance of service aredeferred and recognized as revenue when earned. Within the components of wealth management revenue, commission revenue is determined through the useof subjective judgments and the use of estimates.Commissions represent amounts generated by HD Vest's financial advisors for their clients' purchases and sales of securities and various investmentproducts. The Company generates two types of commissions: transaction-based sales commissions that occur at the point of sale, as well as trailingcommissions for which the Company provides ongoing account support to clients of its financial advisors.The Company records transaction-based sales commission revenue on a trade-date basis, which is when the Company's performance obligations ingenerating the commissions have been substantially completed. Trailing commission revenue is based on a percentage of the current market value of clients'investment holdings in trail-eligible assets and recognized over the period during which services are performed. Since trailing commission revenue isgenerally paid in arrears, the Company estimates it based on a number of factors, including stock market index levels and the amount of trailing commissionrevenues received in prior periods, and also considers historical payout ratios. These estimates are primarily based on historical information and there is notsignificant judgment involved.A substantial portion of commission revenue is ultimately paid to financial advisors. The Company records an estimate for transaction-basedcommissions payable based upon the payout rate of the financial advisor generating the accrued commission revenue. The Company records an estimate fortrailing commissions payable based upon historical payout ratios. Such amounts are recorded as "Commissions and advisory fees payable" on theconsolidated balance sheets and "Wealth management services cost of revenue" on the consolidated statements of comprehensive income.64Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016Tax preparation revenue recognition: The Company derives revenue from the sale of tax preparation digital services, ancillary services, packaged taxpreparation software, and multiple element arrangements that may include a combination of these items. Ancillary services primarily include tax preparationsupport services, and e-filing services. The Company recognizes revenue from the sale of its packaged software when legal title transfers. This is generallywhen its customers download the software from the Internet or, in some cases, when the software ships. This revenue is recorded in the Tax Preparationsegment. Within the components of tax preparation revenue, revenues from bank or reloadable prepaid debit card services and software and/or services thatconsist of multiple elements are determined through the use of subjective judgments and the use of estimates.The bank or reloadable prepaid debit card services are offered to taxpayers as an option to receive their tax refunds in the form of a prepaid bank card orto have the fees for the software and/or services purchased by the customers deducted from their refunds. Other value-added service revenue consists ofrevenue from revenue sharing and royalty arrangements with third party partners. Revenue for these transactions is recognized when the revenue recognitioncriteria are met; for some arrangements that is upon filing and for other arrangements that is upon the Company’s determination of when collectibility isprobable.For software and/or services that consist of multiple elements, the Company must: (1) determine whether and when each element has been delivered;(2) determine the fair value of each element; and (3) allocate the total price among the various elements based on the relative selling price method. Once theCompany has allocated the total price among the various elements, it recognizes revenue when the revenue recognition criteria described above are met foreach element. The impact of multiple element arrangements is not material and primarily impacts the timing of revenue recognition over the tax filing season,which is concentrated within the first two quarters of the filing period.Advertising expenses: Costs for advertising are recorded as expense and classified within "Sales and marketing" on the consolidated statements ofcomprehensive income, when the advertisement appears. Advertising expense totaled $53.3 million, $51.7 million, and $44.0 million for the years endedDecember 31, 2018, 2017, and 2016, respectively. Prepaid advertising costs were $0.3 million and $0.3 million at December 31, 2018 and 2017, respectively.Stock-based compensation: The Company measures stock-based compensation at the grant date based on the fair value of the award and recognizes itas expense, net of estimated forfeitures, over the vesting or service period, as applicable, of the stock award using the straight-line method. The Companyrecognizes stock-based compensation over the vesting period for each separately vesting portion of a share-based award as if they were individual share-based awards. The Company estimates forfeitures at the time of grant, based upon historical data, and revises those estimates, if necessary, in subsequentperiods if actual forfeitures differ from those estimates.Income taxes: The Company accounts for income taxes under the asset and liability method, under which deferred tax assets, including net operatingloss carryforwards, and liabilities are determined based on temporary differences between the book and tax bases of assets and liabilities. The Companyperiodically evaluates the likelihood of the realization of deferred tax assets and reduces the carrying amount of the deferred tax assets by a valuationallowance to the extent the Company believes a portion will not be realized. The Company considers many factors when assessing the likelihood of futurerealization of the deferred tax assets, including expectations of future taxable income, recent cumulative earnings experience by taxing jurisdiction, andother relevant factors. There is a wide range of possible judgments relating to the valuation of the Company's deferred tax assets.The Company records liabilities to address uncertain tax positions that have been taken in previously filed tax returns or that are expected to be takenin a future tax return. The determination for required liabilities is based upon an analysis of each individual tax position, taking into consideration whether itis more likely than not that the tax position, based on technical merits, will be sustained upon examination. The tax benefit to be recognized in the financialstatements from such a position is measured as the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlementwith the taxing authority. The difference between the amount recognized and the total tax position is recorded as a liability. The ultimate resolution of thesetax positions may be greater or less than the liabilities recorded. The Company recognizes interest and penalties related to uncertain tax positions in interestexpense and general and administrative expense, respectively.Foreign currency: The financial position and operating results of the Company's foreign operations are consolidated using the local currency as thefunctional currency. Assets and liabilities recorded in local currencies are translated at the exchange rate on the balance sheet date, while revenues andexpenses are translated at the average exchange rate for the applicable65Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016period. Translation adjustments resulting from this process are recorded in "Accumulated other comprehensive loss" on the consolidated balance sheets. Thegain or loss on foreign currency transactions, calculated as the difference between the historical exchange rate and the exchange rate at the applicablemeasurement date, are recorded in "Other loss, net" on the consolidated statements of comprehensive income.Concentration of credit risk: Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cashequivalents, short-term investments, trade accounts receivable, and commissions receivable. These instruments are generally unsecured and uninsured.For cash equivalents, short-term investments, and commissions receivable, the Company attempts to manage exposure to counterparty credit risk byonly entering into agreements with major financial institutions and investment sponsors that are expected to be able to fully perform under the terms of theagreement.Accounts receivable are typically unsecured and are derived from revenues earned from customers primarily located in the United States operating in avariety of geographic areas. The Company performs ongoing credit evaluations of its customers and maintains allowances for potential credit losses.Geographic revenue information: Almost all of the Company's revenue for 2018, 2017, and 2016 was generated from customers located in the UnitedStates.Recent accounting pronouncements: Changes to GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form ofaccounting standards updates (“ASUs”) to the FASB’s Accounting Standards Codification (“ASC”). The Company considers the applicability and impact ofall recent ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’sconsolidated financial position and results of operations. The Company currently is considering, or has recently adopted, ASUs that impact the followingareas:Revenue recognition - In May 2014, the FASB issued guidance codified in ASC 606, "Revenue from Contracts with Customers" ("ASC 606"), whichamends the guidance in former ASC 605 "Revenue Recognition." The core principle of the guidance is that an entity should recognize revenue to depict thetransfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange forthose goods or services by using a five-step process. This guidance became effective on a retrospective basis--either to each reporting period presented orwith the cumulative effect of initially applying this guidance recognized at the date of initial application--for annual reporting periods, including interimreporting periods within those annual reporting periods, beginning after December 15, 2017.The Company adopted the requirements of the new standard on January 1, 2018, utilizing the modified retrospective transition method. Uponadoption, the Company recognized a $1.8 million cumulative effect as an adjustment to the opening balance of retained earnings and deferred revenues onthe consolidated balance sheets.As a result of the adoption of ASC 606, the Company now recognizes certain licensing fees on a net basis, which reduced both transaction and feerevenues and operating expenses by $1.8 million for the year ended December 31, 2018, on the consolidated statements of comprehensive income (loss). Hadthe Company not adopted ASC 606, total revenues for the year ended December 31, 2018 would have been $3.3 million higher than reported on theconsolidated statements of comprehensive income (loss).Pursuant to the modified retrospective transition method, prior periods were not retrospectively adjusted, and the Company does not disclose the valueof unsatisfied performance obligations for contracts with original expected durations of one year or less.Leases - In February 2016, the FASB issued guidance codified in ASC 842, "Leases", which supersedes the guidance in ASC 840 "Leases." Under ASC842, lease assets and liabilities, whether arising from leases that are considered operating or finance (capital) will be recognized on the balance sheet.Enhanced qualitative disclosures also will be required. This guidance is effective on a modified retrospective basis--with various practical expedients relatedto leases that commenced before the effective date--for annual reporting periods, including interim reporting periods within those annual reporting periods,beginning after December 15, 2018. The Company will adopt ASC 842 on January 1, 2019, for all open leases with a term greater than one year, as of theadoption date, and will elect the hindsight practical expedient in determining its lease terms.66Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016Based upon the Company's current lease obligations, this is expected to result in between $6.0 million and $7.0 million of additional lease assets, between$8.0 million and $10.0 million of additional lease liabilities, and an adjustment to the opening balance of retained earnings between $1.0 million and $2.0million. The Company will also reclassify, upon adoption, deferred rent liabilities to reduce the measurement of lease assets.Stock-based compensation - In March 2016, the FASB issued ASU 2016-09, "Improvements to Employee Shared-Based Payment Accounting." TheASU requires that excess tax benefits and deficiencies be recognized as income tax benefit or expense, rather than as additional paid-in capital. In addition,the ASU requires that excess tax benefits be recorded in the period that shares vest or settle, regardless of whether the benefit reduces taxes payable in thesame period. Cash flows related to excess tax benefits will be included as an operating activity, and no longer classified as a financing activity, in thestatement of cash flows. This guidance was effective for annual reporting periods, including interim reporting periods within those annual reporting periods,beginning after December 15, 2016. The guidance related to the recognition of excess tax benefits and deficiencies as income tax benefit or expense waseffective on a prospective basis, and the guidance related to the timing of excess tax benefit recognition was effective using a modified retrospectivetransition method with a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. The cash flowpresentation guidance was effective on a retrospective or prospective basis.The Company implemented this ASU on January 1, 2017 and recorded a cumulative-effect adjustment of $51.5 million to credit retained earnings fordeferred tax assets related to net operating losses that arose from excess tax benefits, which the Company has deemed realizable. In addition to this:•At the time of adoption and on a prospective basis, the primary impact of adoption was the recognition of excess tax benefits and deficiencies,including deferred tax assets related to net operating losses that arose from excess tax benefits which the Company has deemed realizable in theincome tax provision (rather than in additional paid-in capital). This caused income taxes to differ from taxes at the statutory rates in 2017. For theyear ended December 31, 2017, the Company recognized an estimated $20.1 million decrease to the income tax provision, which resulted in a$20.1 million increase to income from continuing operations and net income attributable to Blucora, a $0.45 increase to basic earnings per share,and a $0.43 increase to diluted earnings per share.•The Company applied the cash flow presentation guidance on a retrospective basis, restating the consolidated statements of cash flows to presentexcess tax benefits as an operating activity (rather than a financing activity). For the year ended December 31, 2017, that resulted in an increase tocash provided by operating activities from continuing operations of $16.0 million and a corresponding decrease to cash used by financingactivities from continuing operations. The restatement had no impact on total cash flows for the period presented.The ASU also clarifies that payments made to tax authorities on an employee's behalf for withheld shares should be presented as a financing activity inthe statement of cash flows, allows the repurchase of more of an employee's shares for tax withholding purposes without triggering liability accounting, andprovides an accounting policy election to account for forfeitures as they occur. The cash flow presentation requirements for payments made to tax authoritieson an employee's behalf had no impact to any periods presented, since such cash flows historically have been presented as a financing activity. TheCompany is not planning to change tax withholdings and will continue to estimate forfeitures in determining the amount of compensation cost to berecognized in each period. Measurement of Credit Losses - In June 2016, the FASB issued ASU 2016-03 "Measurement of Credit Losses on Financial Statements" that requirescompanies to measure credit losses utilizing a methodology that reflects expected credit losses and requires a consideration of a broader range of reasonableand supportable information to inform credit loss estimates. This ASU is effective for fiscal years beginning after December 15, 2019, including those interimperiods within those fiscal years. The Company is currently assessing the impact of adopting this ASU, but based on a preliminary assessment, does notexpect the adoption of this guidance to have a material impact on its consolidated financial statements and related disclosures.Statement of cash flows and restricted cash - In November 2016, the FASB issued ASU 2016-18 "Statement of Cash Flows: Restricted Cash" on theclassification and presentation of changes in restricted cash on the statement of cash flows. The ASU requires that the statement of cash flows explains thechange during the period in the total of cash, cash equivalents, and restricted cash; therefore, the amounts described as restricted cash should be includedwith cash and cash equivalents when67Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016reconciling the beginning and end of period total amounts on the statement of cash flows. This guidance became effective for annual reporting periods,including interim reporting periods within those annual reporting periods, beginning after December 15, 2017. Early adoption is permitted. The guidance iseffective on a retrospective basis. The Company elected to early adopt this guidance as of January 1, 2017. The reclassification was not material to theperiods presented and had no impact on total cash flows, income from continuing operations, or net income attributable to Blucora for the periods presented.Share-Based Payments - In June 2018, the FASB issued ASU 2018-07 "Stock Compensation: Improvements to Nonemployee Share-based PaymentAccounting" that requires companies to account for share-based payments granted to non-employees similarly to share-based payments granted toemployees. This ASU is effective for fiscal years beginning after December 15, 2018, including the interim periods within those fiscal years. Early adoptionof this ASU is permitted. In the third quarter of 2018, the Company early adopted the requirements of the new standard effective January 1, 2018, utilizing thealternative adoption method.The adoption of this ASU had a $0.3 million cumulative effect on the Company's 2018 results, with a corresponding adjustment to additional paid-incapital (amounts below in thousands, except per share data): First Quarter Second Quarter Reported Recast Reported RecastIncome statement data: Wealth management services cost of revenue$63,067 $63,064 $62,452 $62,149Operating income (loss)52,734 52,737 38,823 39,126Net income (loss)45,543 45,546 35,157 35,460Net income (loss) attributable to Blucora, Inc.45,338 45,341 34,935 35,238 Net income (loss) per share attributable to Blucora, Inc.: Basic$0.97 $0.97 $0.74 $0.75 Weighted average shares outstanding: Basic46,641 46,641 47,221 47,221Note 3: Segment Information and RevenuesThe Company has two reportable segments: the Wealth Management segment and the Tax Preparation segment. The Company’s Chief ExecutiveOfficer is its chief operating decision maker and reviews financial information presented on a disaggregated basis. This information is used for purposes ofallocating resources and evaluating financial performance.The Company does not allocate certain general and administrative costs (including personnel and overhead costs), stock-based compensation,depreciation, and amortization of intangible assets to the reportable segments. Such amounts are reflected in the table under the heading "Corporate-levelactivity." In addition, the Company does not allocate other loss, net and income taxes to the reportable segments. The Company does not account for, anddoes not report to management, its assets or capital expenditures by segment other than goodwill and intangible assets used for impairment analysis purposes.Information on reportable segments currently presented to the Company’s chief operating decision maker and a reconciliation to consolidated netincome are presented below (in thousands):68Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016 Years ended December 31, 20182017 2016Revenue:Wealth Management$373,174 $348,620 $316,546Tax Preparation187,282 160,937 139,365Total revenue560,456 509,557 455,911Operating income: Wealth Management53,053 50,916 46,296Tax Preparation87,249 72,921 66,897Corporate-level activity(72,625) (75,800) (76,076)Total operating income67,677 48,037 37,117Other loss, net(15,797) (44,551) (39,781)Income tax benefit (expense)(311) 25,890 1,285Discontinued operations, net of income taxes— — (63,121)Net income (loss)$51,569 $29,376 $(64,500)Revenues by major category within each segment are presented below (in thousands): Years ended December 31, 2018 2017 2016Wealth Management: Commission$164,201 $160,241 $150,125Advisory164,353 145,694 129,417Asset-based31,456 26,297 22,653Transaction and fee13,164 16,388 14,351Total Wealth Management revenue$373,174 $348,620 $316,546Tax Preparation: Consumer$172,207 $147,084 $126,289Professional15,075 13,853 13,076Total Tax Preparation revenue$187,282 $160,937 $139,365See "Note 2: Summary of Significant Accounting Policies" for a discussion of the new revenue recognition standard, ASC 606, adopted by the Companyon January 1, 2018.Wealth Management revenue recognition: Wealth Management revenue consists primarily of commission revenue, advisory revenue, asset-basedrevenue, and transaction and fee revenue. The Company's Wealth Management revenues are earned from customers primarily located in the United States.Wealth management revenue details are as follows:Commission revenue - Commission revenue represents amounts generated by the Company's clients' purchases and sales of securities and variousinvestment products. The Company serves as the registered broker/dealer or insurance agent for those trades. The Company generates two types ofcommission revenues: transaction-based sales commissions that occur on the trade date, which is when the Company's performance obligations have beensubstantially completed, and trailing commissions, which are paid to the Company (typically in arrears on a quarterly basis) based on the clients' accountbalance, rather than a per-transaction fee.Advisory revenue - Advisory revenue includes fees charged to clients in advisory accounts where the Company is the Registered Investment Adviser.These fees are based on the value of assets within these advisory accounts. Advisory revenues69Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016are deferred and recognized ratably over the period (typically quarterly) in which the performance obligations, which are defined in ASC 606 as promises totransfer goods or services, have been completed.Asset-based revenue - Asset-based revenue primarily includes fees from financial product manufacturer sponsorship programs, cash sweep programs andother asset-based revenues, primarily including margin revenues, and are recognized ratably over the period in which services are provided.Transaction and fee revenue - Transaction and fee revenue primarily includes support fees charged to advisers, which are recognized over time asadvisory services are provided, fees charged for executing certain transactions in client accounts, which are recognized on a trade-date basis, and other feesrelated to services provided and other account charges as generally outlined in agreements with financial advisers, clients, and financial institutions, whichare recognized as services are performed or as earned, as applicable.Details of Wealth Management revenues are: Year ended December 31, 2018Wealth Management Segment RevenuesRecognized UponTransaction Recognized Over Time TotalCommission revenue$67,351 $96,850 $164,201Advisory revenue— 164,353 164,353Asset-based revenue— 31,456 31,456Transaction and fee revenue3,211 9,953 13,164Total$70,562 $302,612 $373,174Tax Preparation revenue recognition: The Company derives revenue from the sale of Tax Preparation digital services, ancillary services, packaged taxpreparation software, and arrangements that may include a combination of these items. Ancillary services include Tax Preparation support services, e-filingservices, bank or reloadable pre-paid debit card services, and other value-added services, including enhanced tax and Wealth Management services throughHD Vest. The Company’s Tax Preparation revenues are earned from customers primarily located in the United States.70Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016Tax Preparation revenue details are as follows:Consumer revenue - Consumer revenue includes revenue associated with the Company’s digital software products, downloadable or shipped desktopsoftware products, add-on services such as refund payment transfer services, bank or reloadable pre-paid debit card services, gift cards and audit defenseservices.Digital revenues include revenues associated with the Company’s digital software products sold to customers and businesses primarily for thepreparation of individual or business tax returns, and are generally recognized when customers and businesses complete and file returns.Desktop revenues primarily include revenues from all downloadable or shipped software products and are generally recognized when customersdownload the software or when the software ships.Add-on services are revenues related to services such as refund payment transfer services, bank or reloadable pre-paid debit card services, gift cards andaudit defense services, and are generally recognized as customers complete and file returns.Professional revenue - Professional revenues include revenues associated with the Company’s desktop software products sold to tax return preparerswho utilize the Company’s offerings to service end customers and are generally recognized when customers download the software or when the softwareships. Professional customers have the option to elect an unlimited e-filing package or a pay-per-return package. As the unlimited e-filing package can be re-used, those revenues are recognized over an estimated filing timeline. Revenues from the pay-per-return package are recognized when customers completeand file returns.Details of Tax Preparation revenues are: Year ended December 31, 2018Tax Preparation Segment RevenuesRecognized UponTransaction Recognized Over Time TotalConsumer$172,207 $— $172,207Professional12,604 2,471 15,075Total$184,811 $2,471 $187,282Note 4: Business CombinationsHD Vest: On December 31, 2015, pursuant to a Purchase Agreement dated October 14, 2015, the Company acquired HD Vest for $613.7 million,including cash acquired of $38.9 million and after a $1.8 million final working capital adjustment in the first quarter of 2016. In connection with theacquisition, certain members of HD Vest management rolled over a portion of the proceeds they would have otherwise received at the closing into shares ofthe acquisition subsidiary through which the Company consummated the purchase of HD Vest. A portion of those shares were sold to the Company inexchange for a promissory note. After giving effect to the rollover shares and related purchase of the rollover shares for the promissory note, the Companyindirectly owns 95.52% of HDV Holdings, Inc., with the remaining 4.48% noncontrolling interest held collectively by the rollover management members andsubject to put and call arrangements exercisable beginning in 2019.The acquisition was funded by a combination of cash on hand and the TaxAct - HD Vest 2015 credit facility, under which the Company borrowed$400.0 million (see "Note 10: Debt").Certain members of HD Vest management rolled over a portion of the proceeds they would have otherwise received at the acquisition's closing intoshares of the acquisition subsidiary through which the Company consummated the purchase of HD Vest. The former President of HD Vest sold a portion of hisshares to the Company in exchange for a promissory note. The promissory note was scheduled to be paid over a three-year period with 50% to be paid in yearone ($3.2 million paid in71Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016December 2016), 40% to be paid in 2017, and 10% to be paid in 2018. In December 2017, the Company fully repaid the remaining $3.2 million outstanding.The note bore interest at a rate of 5% per year.Note 5: Discontinued OperationsOn October 14, 2015, the Company announced its plans to focus on the technology-enabled financial solutions market, as more fully described in"Note 1: Description of the Business." The Strategic Transformation included plans to divest the Search and Content and E-Commerce businesses. Financialcondition, results of operations, cash flows, and the notes to financial statements reflect the Search and Content and E-Commerce businesses as discontinuedoperations for all periods presented. Amounts in discontinued operations include previously unallocated depreciation, amortization, stock-basedcompensation, income taxes, and other corporate expenses that were attributable to the Search and Content and E-Commerce businesses.On November 17, 2016, the Company closed on an agreement with YFC, under which YFC acquired the E-Commerce business for $40.5 million, whichincluded a working capital adjustment. Of this amount, $39.5 million was received in the fourth quarter of 2016 and the remaining $1.0 million was receivedin the first half of 2017. The Company used all of the proceeds to pay down debt and recognized a loss on sale of the E-Commerce business of approximately$52.2 million.On August 9, 2016, the Company closed on an agreement with OpenMail, under which OpenMail acquired substantially all of the assets and assumedcertain specified liabilities of the Search and Content business for $45.2 million. The Company used all of the proceeds to pay down debt and recognized aloss on sale of the Search and Content business of approximately $21.6 million.Under a separate agreement, the Company is subleasing to InfoSpace the office space that InfoSpace is using currently. The rent payments andSeptember 2020 termination date are consistent with the underlying non-cancelable operating lease.Summarized financial information for discontinued operations is as follows (in thousands): Year ended December 31, 2016Major classes of items in net income (loss): Revenues$227,989Operating expenses(211,395)Other income (loss), net(719)Income (loss) from discontinued operations before income taxes15,875Loss on sale of discontinued operations before income taxes(73,800)Discontinued operations, before income taxes(57,925)Income tax benefit (expense)(5,196)Discontinued operations, net of income taxes$(63,121)Business exit costs: In conjunction with the Strategic Transformation, the Company incurred business exit costs of approximately $4.5 million, whichprimarily were recorded in discontinued operations in the fourth quarter of 2015 and the first quarter of 2016.Note 6: RestructuringThe table below summarizes the activity in the restructuring liability (in thousands), resulting from the relocation of the Company's corporateheadquarters to Irving, Texas in 2017. These costs were primarily recorded in "Restructuring" on the consolidated statements of comprehensive income andwithin corporate-level activity for segment purposes.72Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016 Employee-RelatedTermination Costs ContractTerminationCosts Fixed AssetImpairments Stock-BasedCompensation Other Costs TotalBalance as of December 31, 2016$4,234 $— $— $— $— $4,234Restructuring charges261 (241) 1,878 1,148 55 3,101Payments(3,293) (535) — — (55) (3,883)Non-cash— 1,457 (1,878) (1,148) — (1,569)Balance as of December 31, 2017$1,202 $681 $— $— $— $1,883Restructuring charges288 — — — — 288Payments(1,490) (157) — — (1,647)Balance as of December 31, 2018$— $524 $— $— $— $524Employee-related termination costs primarily include severance benefits, under both ongoing and one-time benefit arrangements. Contract terminationcosts and fixed asset impairments were incurred in connection with the previous headquarters' operating lease and related fixed assets, which are describedfurther in the next two paragraphs, respectively. Stock-based compensation primarily includes the impact of equity award modifications associated withemployment contracts for certain individuals impacted by the relocation, as well as forfeitures that were recorded for severed employees. Other costs includeoffice relocation costs.The Company has a non-cancelable operating lease that runs through 2020 for its former corporate headquarters in Bellevue, Washington, which theCompany occupied until May 2017. In March 2017, the Company agreed to a sublease for the entire Bellevue facility, which was effective June 1, 2017 andexpires on September 30, 2020, consistent with the underlying operating lease. Under that sublease agreement, the Company will not recover all of itsremaining lease rental obligations (including common area maintenance costs and real estate taxes) and, therefore, recognized a net loss on sublease of $0.4million, shown above under contract termination costs.The Company fully impaired the $1.9 million carrying value of the leasehold improvements and the office furniture and equipment that would not befully recovered in connection with this lease.All of these items were recorded in the first quarter of 2017.Note 7: Goodwill and Other Intangible AssetsThe following table presents goodwill by reportable segment (in thousands): Wealth Management Tax Preparation TotalBalance as of December 31, 2016$356,041 $192,700 $548,741Foreign currency translation adjustment— 296 296Balance as of December 31, 2017356,041 192,996 549,037Foreign currency translation adjustment— (352) (352)Balance as of December 31, 2018$356,041 $192,644 $548,685 73Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016Intangible assets other than goodwill consisted of the following (in thousands): December 31, 2018 December 31, 2017 Weighted AverageAmortizationPeriod (months)Grosscarryingamount Accumulatedamortization Net Grosscarryingamount Accumulatedamortization NetDefinite-lived intangible assets: Advisor relationships204$240,300 $(50,973) $189,327 $240,300 $(34,211) $206,089Customer relationships13101,686 (87,811) 13,875 101,711 (75,105) 26,606Technology3643,847 (38,396) 5,451 43,895 (35,452) 8,443Sponsor relationships18016,500 (2,750) 13,750 16,500 (1,833) 14,667Curriculum12800 (600) 200 800 (400) 400Total definite-lived intangibleassets186403,133 (180,530) 222,603 403,206 (147,001) 256,205Indefinite-lived intangible assets: Trade names 72,000 — 72,000 72,000 — 72,000Total $475,133 $(180,530) $294,603 $475,206 $(147,001) $328,205Amortization expense was as follows (in thousands): Years ended December 31, 2018 2017 2016Statement of comprehensive income line item: Cost of revenue$99 $195 $812Amortization of other acquired intangible assets33,487 33,807 33,331Total$33,586 $34,002 $34,143Expected amortization of definite-lived intangible assets held as of December 31, 2018 is as follows (in thousands): 2019 2020 2021 2022 2023 Thereafter TotalStatement of comprehensive income (loss) line item: Amortization of other acquired intangible assets$32,176 $19,822 $16,992 $14,841 $14,405 $124,367 $222,60374Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016Note 8: Fair Value MeasurementsIn accordance with ASC 820, "Fair Value Measurements and Disclosures," certain of the Company's assets and liabilities, which are carried at fair value,are classified in one of the following three categories:Level 1: Quoted market prices in active markets for identical assets or liabilities.Level 2: Observable market-based inputs, other than Level 1, or unobservable inputs that are corroborated by market data.Level 3: Unobservable inputs that are not corroborated by market data and reflect the Company’s own assumptions.The fair value hierarchy of the Company's financial assets and liabilities carried at fair value and measured on a recurring basis was as follows (inthousands): December 31, 2018 Fair value measurements at the reporting date using Quoted prices in activemarkets using identicalassets(Level 1) Significant other observableinputs (Level 2) Significantunobservable inputs(Level 3)Cash equivalents: money market and other funds$23,181 $23,181 $— $—Total assets at fair value$23,181 $23,181 $— $—Acquisition-related contingent consideration liability$1,275 $— $— $1,275Total liabilities at fair value$1,275 $— $— $1,275 December 31, 2017 Fair value measurements at the reporting date using Quoted prices in activemarkets using identicalassets(Level 1) Significant other observableinputs (Level 2) Significantunobservable inputs(Level 3)Cash equivalents: money market and other funds$10,857 $10,857 $— $—Total assets at fair value$10,857 $10,857 $— $—Acquisition-related contingent consideration liability$2,689 $— $— $2,689Total liabilities at fair value$2,689 $— $— $2,689A reconciliation of Level 3 items measured at fair value on a recurring basis was as follows (in thousands): Years ended December 31, 2018 2017Acquisition-related contingent consideration liability: Balance at beginning of year$2,689 $3,421Payment(1,315) (946)Foreign currency transaction (gain) loss(99) 214Balance at end of year$1,275 $2,689Cash equivalents are classified within Level 1 of the fair value hierarchy because the Company values them utilizing quoted prices in active markets.Unrealized gains and losses are included in "Accumulated other comprehensive loss" on the consolidated balance sheets, and amounts reclassified out ofcomprehensive income into net income are determined on the basis of specific identification.The contingent consideration liability is related to the Company's 2015 acquisition of SimpleTax Software Inc. ("SimpleTax"), and the relatedpayments that began in 2017 and are expected to continue annually through 2019. As of December 31, 2018, the Company was required to an additionalamount of $1.3 million. This liability is included within Level75Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 20163 of the fair value hierarchy because the Company values it utilizing inputs not observable in the market. Specifically, the Company has determined the fairvalue of the contingent consideration liability based on a probability-weighted discounted cash flow analysis, which includes assumptions related toestimating SimpleTax revenues, the probability of payment (100%), and the discount rate (9%).The change in the fair value of the contingent consideration liability is recognized in "General and administrative" expense on the consolidatedstatements of comprehensive income for the period in which the fair value changes. As of December 31, 2018, the contingent consideration liability wasincluded in "Accrued expenses and other current liabilities" on the consolidated balance sheets.Note 9: Balance Sheet ComponentsOther receivables consisted of the following (in thousands): December 31, 2018 2017Income taxes receivable$7,243 $2,802Other receivables165 378Total other receivables$7,408 $3,180Prepaid expenses and other current assets, net consisted of the following (in thousands): December 31, 2018 2017Prepaid expenses$7,169 $6,972Other current assets586 393Total prepaid expenses and other current assets, net$7,755 $7,365Property and equipment, net consisted of the following (in thousands): December 31,20182017Internally-developed software$9,220 $2,728Computer equipment and data center5,6417,121Purchased software4,2144,200Leasehold improvements and other3,313 3,244Office furniture929 801Office equipment66255723,97918,651Accumulated depreciation(13,724)(12,081)10,2556,570Capital projects in progress2,1343,261Total property and equipment, net$12,389$9,831Total depreciation expense was $5.0 million, $4.1 million, and $4.5 million for the years ended December 31, 2018, 2017, and 2016, respectively.The net book value of internally-developed software was $8.0 million and $4.1 million at December 31, 2018 and 2017, respectively. The Companyrecorded amortization expense for internally-developed software of $1.5 million, $0.9 million, and $1.0 million for the years ended December 31, 2018,2017, and 2016, respectively.76Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016Accrued expenses and other current liabilities consisted of the following (in thousands): December 31, 2018 2017Salaries and related expenses$13,050 $12,451Other5,976 7,126Total accrued expenses and other current liabilities$19,026 $19,577 In 2018, the Company received approximately $9.3 million of incentives from its new clearing firm provider, which is reported in current and long-termdeferred revenue on the consolidated balance sheets. The Company offsets these incentives against operating expenses.Note 10: DebtThe Company’s debt consisted of the following (in thousands): December 31, 2018 December 31, 2017 Unamortized Unamortized Principalamount Discount Debt issuancecosts Net carryingvalue Principalamount Discount Debt issuancecosts Net carryingvalueSenior secured credit facility$265,000 $(970) $(3,640) $260,390 $345,000 $(1,455) $(5,464) $338,081 Senior secured credit facility: In May 2017, the Company entered into a credit agreement with a syndicate of lenders in order to provide a term loanand revolving line of credit for working capital, capital expenditures and general business purposes (the "Blucora senior secured credit facilities"). TheBlucora senior secured credit facilities provide for up to $425.0 million of borrowings, consisting of a committed $50.0 million revolving credit facility(including a letter of credit sub-facility) and a $425.0 million term loan facility that mature in May 22, 2022 and May 22, 2024, respectively. Obligationsunder the Blucora senior secured credit facilities are guaranteed by certain of Blucora's subsidiaries and secured by the assets of the Company and itssubsidiaries. The Blucora senior secured credit facilities include financial and operating covenants, including a consolidated total net leverage ratio, whichare set forth in detail in the credit facility agreement. As of December 31, 2018, the Company was in compliance with all of the financial and operatingcovenants under the credit facility agreement.Principal payments on the term loan are payable quarterly in an amount equal to 0.25% of the initial outstanding principal. In November 2017, thecredit facility agreement was amended in order to refinance and reprice the initial term loan, such that the applicable interest rate margin is 3.00% forEurodollar Rate loans and 2.00% for ABR loans. During the year ended December 31, 2018, the Company made prepayments of $80.0 million towards theterm loan.Depending on the Company’s Consolidated First Lien Net Leverage Ratio (as defined in the credit facility agreement), the applicable interest ratemargin on the revolving credit facility is from 2.75% to 3.00% for Eurodollar Rate loans and 1.75% to 2.00% for ABR loans. Interest is payable at the end ofeach interest period. As of December 31, 2018 the Company had not borrowed any amounts under the revolving credit facility.The Company also has the right to prepay the term loan or outstanding amounts under the revolving credit facility without any premium or penalty(other than customary Eurodollar breakage costs). Prepayments on the term loan are subject to certain prepayment minimums. Beginning with the fiscal yearending December 31, 2018, the Company may be required to make annual prepayments on the term loan in an amount equal to a percentage of excess cashflow of the Company during the applicable fiscal year from 0% to 50%, depending on the Consolidated First Lien Net Leverage Ratio (as defined in thecredit facility agreement) for such fiscal year.As of December 31, 2018, the term loan facility's principal amount approximated its fair value as it is a variable rate instrument and the currentapplicable margin approximates current market conditions.77Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016When the Company entered into the Blucora senior secured credit facilities, it terminated the TaxAct - HD Vest 2015 credit facilities (defined below).At that time, the Company performed an analysis by creditor and determined that the refinancing qualified as an extinguishment of the TaxAct - HD Vest2015 credit facilities and the Notes (each of which are defined below). As a result, the Company recognized a loss on debt extinguishment during the yearended December 31, 2017, which was recorded in "Other loss, net" on the consolidated statements of comprehensive income and consisted of the following(in thousands):Loss on debt extinguishment - TaxAct - HD Vest 2015 credit facility$9,593Loss on debt extinguishment - Convertible Senior Notes6,715Total loss on debt extinguishment$16,308The amount for the TaxAct - HD Vest 2015 credit facility included the write-off of the remaining unamortized discount and debt issuance costs. For theNotes, the Company allocated the cash paid first to the liability component of the Notes based on the fair value of the redeemed Notes. The fair value wasbased on a discounted cash flow analysis of the Notes' principal and related interest payments, using a discount rate that approximated the current market ratefor similar debt without conversion rights. The difference between the fair value and net carrying value of the repurchased Notes was recognized as a loss andrecorded in "Other loss, net" on the consolidated statements of comprehensive income. No amount was allocated to the equity component of the Notes, sincethe fair value of the liability component exceeded the cash paid.TaxAct - HD Vest 2015 credit facility: On December 31, 2015, TaxAct and HD Vest entered into an agreement with a syndicate of lenders for thepurposes of financing the HD Vest acquisition and providing future working capital flexibility for TaxAct and HD Vest (the "TaxAct - HD Vest 2015 creditfacilities"). The credit facility consisted of a $25.0 million revolving credit loan--which included a letter of credit and swingline loans--and a $400.0 millionterm loan for an aggregate $425.0 million credit facility. The final maturity dates of the revolving credit loan and term loan were December 31, 2020 andDecember 31, 2022, respectively. Obligations under the credit facility were guaranteed by TaxAct Holdings, Inc. and HD Vest Holdings, Inc. and weresecured by the equity of the TaxAct and HD Vest businesses. While Blucora was not a party to the agreement, it had guaranteed the obligations of TaxActand HD Vest under the credit facility, secured by its equity in TaxAct Holdings, Inc.TaxAct and HD Vest borrowed $400.0 million under the term loan and had net repayment activity of $64.0 million and $140.0 million during 2017and 2016, respectively. These repayments resulted in the acceleration of a portion of the unamortized discount and debt issuance costs, which were recordedin "Other loss, net" on the consolidated statements of comprehensive income.Convertible Senior Notes: On March 15, 2013, the Company issued $201.3 million aggregate principal amount of its Convertible Senior Notes ("theNotes"), inclusive of the underwriters’ exercise in full of their over-allotment option of $26.3 million. In June 2017, the Company redeemed almost all of theoutstanding Notes for cash with proceeds from the senior secured credit facility. The Company received net proceeds from the offering of approximately$194.8 million after adjusting for debt issuance costs, including the underwriting discount.During 2016, the Company repurchased $28.4 million of the Notes' principal for cash of $20.7 million. The Company allocated the cash paid first tothe liability component of the Notes based on the fair value of the repurchased Notes. The fair value was based on a discounted cash flow analysis of theNotes' principal and related interest payments, using a discount rate that approximated the current market rate for similar debt without conversion rights. Thedifference between the fair value and net carrying value of the repurchased Notes was recognized as a gain, since the Notes were repurchased below par value,and recorded in "Other loss, net" on the consolidated statements of comprehensive income (see "Note 14: Other Loss, Net" for details). No amount wasallocated to the equity component of the Notes, since the fair value of the liability component exceeded the cash paid. The repurchase also resulted in thewrite-down of a portion of the unamortized discount and debt issuance costs, which was also recorded in "Other loss, net" on the consolidated statements ofcomprehensive income.78Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016The following table sets forth total interest expense related to the Notes (in thousands): Years ended December 31, 2017 2016Contractual interest expense (Cash)$3,141 $7,619Amortization of debt issuance costs (Non-cash)401 939Accretion of debt discount (Non-cash)1,567 3,666Total interest expense$5,109 $12,224Effective interest rate of the liability component7.32% 7.32%Note 11: Commitments and ContingenciesThe Company's contractual commitments are as follows for years ending December 31 (in thousands): 2019 2020 2021 2022 2023 Thereafter TotalOperating lease commitments: Operating lease obligations$3,759 $3,461 $2,245 $1,979 $1,677 $— $13,121Sublease income(1,288) (991) — — — — (2,279)Net operating lease commitments2,471 2,470 2,245 1,979 1,677 — 10,842Purchase commitments10,088 7,311 5,640 4,077 2,444 3,325 32,885Debt commitments— — — — — 265,000 265,000Interest payable11,654 11,686 11,654 11,654 11,654 4,854 63,156Acquisition-related contingentconsideration liability1,275 — — — — — 1,275Total$25,488 $21,467 $19,539 $17,710 $15,775 $273,179 $373,158Operating lease commitments: As discussed in "Note 6: Restructuring", the Company has a non-cancelable operating lease that runs through 2020 forits former corporate headquarters in Bellevue, Washington, which the Company occupied until May 2017. In March 2017, the Company agreed to a subleasefor the entire Bellevue facility, which was effective June 1, 2017 and expires on September 30, 2020, consistent with the underlying operating lease.The Company leases office space, and these leases are classified as operating leases. Net rent expense under those operating leases was as follows (inthousands): Years ended December 31, 2018 2017 2016Rent expense$2,860 $2,972 $3,793Less: sublease rent income(1,292) (594) (342)Net rent expense$1,568 $2,378 $3,451Purchase commitments: The Company's purchase commitments consist primarily of marketing agreements, commitments with a vendor to providecloud computation services, commitments to its new clearing firm provider and commitments for advisory support programs.Debt commitments and interest on Notes: The Company’s debt commitments are based upon contractual payment terms and consist of the outstandingprincipal related to the Blucora senior secured credit facility. For further detail regarding the credit facility, see "Note 10: Debt."79Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016Acquisition-related contingent consideration liability: The contingent consideration liability is related to the Company's acquisition of SimpleTax(see "Note 4: Business Combinations" and "Note 8: Fair Value Measurements"), and the related payments that began in 2017 and are expected to continueannually through 2019.Off-balance sheet arrangements: The Company has no off-balance sheet arrangements other than operating leases.Litigation: From time to time, the Company is subject to various legal proceedings or claims that arise in the ordinary course of business. The Companyaccrues a liability when management believes that it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated.Following is a brief description of the more significant legal proceedings. Although the Company believes that resolving such claims, individually or inaggregate, will not have a material adverse impact on its financial statements, these matters are subject to inherent uncertainties.On December 12, 2016, a shareholder derivative action was filed by Jeffrey Tilden against the Company, as a nominal defendant, Andrew Snyder, whowas a director of the Company at that time, certain companies affiliated with Mr. Snyder, a former officer of the Company, GCA Savvian Advisors, LLC("GCA Savvian"), and certain other current and former members of the Blucora Board of Directors, in the Superior Court of the State of California in and forthe County of San Francisco. The complaint asserted claims for breaches of fiduciary duty against certain current and former directors of the Company relatedto the Company’s share repurchases and the Company’s acquisitions of HD Vest and Monoprice. The complaint asserted a claim against GCA Savvian, theCompany’s financial advisor in connection with the HD Vest acquisition, for aiding and abetting breaches of fiduciary duty. The complaint also asserted aclaim for insider trading against Mr. Snyder, a former director of the Company, and certain companies affiliated with Mr. Snyder. The derivative action didnot seek monetary damages from the Company. The complaint sought corporate governance reforms, declaratory relief, monetary damages from the otherdefendants, attorney’s fees and prejudgment interest.On March 10, 2017, the Company filed a motion to dismiss for improper venue as a result of a forum selection provision in the Company’s bylaws thatrequired the plaintiff to file his derivative fiduciary duty claims in Delaware. Other defendants also filed motions to quash the summons due to a lack ofpersonal jurisdiction over them. On July 25, 2017, the Court granted the Company's motion to dismiss. The case was stayed by the Court until November 22,2017 so that Mr. Tilden could file a complaint in Delaware, after which the case was dismissed without further order of the Court.On November 21, 2017, Mr. Tilden filed a shareholder derivative action in the Delaware Court of Chancery asserting the same claims against the samedefendants and seeking the same relief as the San Francisco Superior Court lawsuit. On January 31, 2018, the Company filed a motion to dismiss theDelaware complaint, and a hearing on the motion was held on July 11, 2018. The motion to dismiss was granted on October 26, 2018, and the case has beendismissed with prejudice and without leave to amend.The Company has entered into indemnification agreements in the ordinary course of business with its officers and directors, and the agreement enteredinto with GCA Savvian in connection with the acquisition of HD Vest also contained indemnification provisions. Pursuant to these agreements, the Companymay be obligated to advance payment of legal fees and costs incurred by the defendants pursuant to the Company’s obligations under these indemnificationagreements and applicable Delaware law.Note 12: Stockholders' EquityStock incentive plan: The Company may grant incentive or non-qualified stock options, stock, restricted stock, restricted stock units ("RSUs"), stockappreciation rights and performance shares or performance units to employees, non-employee directors, and consultants.The Company granted options and RSUs during 2018, 2017 and 2016 under its 2015 Incentive Plan (as amended and restated), as well as options andRSUs during 2016 under its 2016 Inducement Plan. In addition, the Company granted RSUs in 2018 to Directors under its 2018 Long-Term Incentive Plan.Options and RSUs generally vest over a period of one-to-three years, with the majority vesting over three years. Options and RSUs have one-third vesting oneyear from the date of grant and the remainder vesting ratably thereafter on an annual basis for most awards in 2018 and semi-annually for awards prior to2018, and options expire seven years from the date of grant. There are a few exceptions to this vesting schedule, which provide for vesting at different rates orbased on achievement of performance targets.80Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016The Company issues new shares upon the exercise of options and upon the vesting of RSUs. If an option or RSU is surrendered or otherwise unused, therelated shares will continue to be available.Employee Stock Purchase Plan: The 2016 Employee Stock Purchase Plan (“ESPP”) permits eligible employees to contribute up to 15% of their baseearnings toward the twice-yearly purchase of Company common stock, subject to an annual maximum dollar amount. The purchase price is the lesser of 85%of the fair market value of common stock on the first day or on the last day of an offering period. An aggregate of 2.4 million shares of common stock areauthorized for issuance under the ESPP. Of this amount, 0.8 million shares were available for issuance as of December 31, 2018. The Company issues newshares upon purchase through the ESPP.Other comprehensive income: The following table provides information about activity in other comprehensive income (in thousands): Unrealized gain (loss)on investments Foreign currencytranslation adjustment TotalBalance as of December 31, 2015$(10) $(517) $(527)Other comprehensive income9 137 146Balance as of December 31, 2016(1) (380) (381)Other comprehensive income1 376 377Balance as of December 31, 2017— (4) (4)Other comprehensive loss— (442) (442)Balance as of December 31, 2018$— $(446) $(446)Note 13: Stock-Based CompensationA summary of the general terms of stock options and RSUs at December 31, 2018 was as follows: Number of shares authorized for awards11,958,417Options and RSUs outstanding3,310,874Options and RSUs expected to vest3,105,386Options and RSUs available for grant6,711,996The following activity occurred under the Company’s stock incentive plans:OptionsWeighted averageexercise priceIntrinsic value(in thousands)Weighted averageremainingcontractual term (inyears)Stock options:Outstanding December 31, 20173,805,922 $13.13 Granted322,823 $24.08 Forfeited(199,651) $16.28 Exercised(1,481,155) $12.62 Outstanding December 31, 20182,447,939 $14.62 $29,423 4.5Exercisable December 31, 2018970,285 $11.80 $14,401 4.0Vested and expected to vest after December 31, 20182,342,602 $14.43 $28,601 4.481Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016Stock unitsWeighted averagegrant date fair valueIntrinsic value(in thousands)Weighted averageremainingcontractual term (inyears)RSUs:Outstanding December 31, 2017914,241 $12.10 Granted582,285 $26.89 Forfeited(103,684) $17.75 Vested(529,907) $11.48 Outstanding December 31, 2018862,935 $21.78 $22,989 1.1Expected to vest after December 31, 2018762,784 $21.65 $20,321 1.1Supplemental information is presented below: Years ended December 31, 2018 2017 2016Stock options: Weighted average grant date fair value per share granted$7.68 $6.25 $2.46Total intrinsic value of options exercised (in thousands)$27,759 $44,405 $437Total fair value of options vested (in thousands)$4,142 $5,566 $7,064RSUs: Weighted average grant date fair value per unit granted$26.89 $18.39 $7.82Total intrinsic value of units vested (in thousands)$16,452 $14,642 $5,755Total fair value of units vested (in thousands)$6,069 $6,469 $8,983The Company included the following amounts for stock-based compensation expense, which related to stock options, RSUs, and the ESPP, in theconsolidated statements of comprehensive income (in thousands): Years ended December 31, 2018 2017 2016Cost of revenue$1,467 $774 $166Engineering and technology766 984 1,640Sales and marketing2,424 2,376 2,548General and administrative8,596 7,519 9,774Restructuring— 1,148 (364)Total in continuing operations13,253 12,801 13,764Discontinued operations— — 1,471Total$13,253 $12,801 $15,235In 2016, the Company recorded stock-based compensation expense in connection with the corporate headquarters relocation announcement. See "Note6: Restructuring" for additional information.82Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016To estimate stock-based compensation expense, the Company used the Black-Scholes-Merton valuation method with the following assumptions forstock options granted: Years ended December 31, 2018 2017 2016Risk-free interest rate1.82% - 2.54% 1.2% - 1.94% 0.83% - 1.59%Expected dividend yield0% 0% 0%Expected volatility38% - 42% 39% - 45% 35% - 45%Expected life3.6 3.8 3.4The risk-free interest rate was based on the implied yield available on U.S. Treasury issues with an equivalent remaining term. The Company last paid adividend in 2008. The expected volatility was based on historical volatility of the Company’s stock for the related expected life of the award. The expectedlife of the award was based on historical experience, including historical post-vesting termination behavior.As of December 31, 2018, total unrecognized stock-based compensation expense related to unvested stock awards is as follows: Expense(in thousands) Weighted average periodover which to be recognized(in years)Stock options$3,085 1.3RSUs8,576 1.8Total for continuing operations$11,661 1.7 Note 14:Other Loss, Net"Other loss, net" consisted of the following (in thousands): Years ended December 31, 2018 2017 2016Interest expense$15,610 $21,211 $32,424Loss on debt extinguishment and amortization of debt issuance costs2,367 21,534 2,876Accretion of debt discounts163 1,947 4,690Interest income(349) (110) (81)Other(1,994) (31) (128)Other loss, net$15,797 $44,551 $39,781In 2018, the Company had a $2.1 million gain on the sale of an investment that is included in "Other" above.Note 15: 401(k) PlanThe Company has a 401(k) savings plan covering its employees. Eligible employees may contribute through payroll deductions. The Company maymatch the employees’ 401(k) contributions at the discretion of the Company’s Board of Directors. Pursuant to a continuing resolution, the Company hasmatched a portion of the 401(k) contributions made by its employees. The amount contributed by the Company ranges from 1% to 4% of an employee'ssalary, depending upon the percentage contributed by the employee. For the years ended December 31, 2018, 2017, and 2016, the Company contributed $1.9million, $1.6 million, and $1.4 million, respectively, for employees.83Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016Note 16: Income TaxesIncome (loss) from continuing operations before income taxes consisted of the following (in thousands): Years ended December 31, 2018 2017 2016United States$51,385 $3,293 $(2,678)Foreign495 193 14Income (loss) from continuing operations before income taxes51,880 3,486 (2,664)Income tax expense (benefit) consisted of the following (in thousands): Years ended December 31, 201820172016Current: U.S. federal$(42) $123 $14,695State3,230 962 2,048Foreign157 122 27Total current expense3,345 1,207 16,770Deferred: U.S. federal(3,035) (26,012) (16,608)State37 (1,022) (1,421)Foreign(36) (63) (26)Total deferred benefit(3,034) (27,097) (18,055)Income tax expense (benefit)$311 $(25,890) $(1,285)Income tax expense (benefit) differed from the amount computed by applying the statutory federal income tax rate of 21% for 2018, and 35% for 2017and 2016, as follows (in thousands): Years ended December 31, 20182017 2016Income tax expense (benefit) at the statutory federal income tax rate$10,895 $1,220 $(930)Non-deductible compensation2,796 283 249State income taxes, net of federal benefit2,014 582 454Uncertain tax positions and audit settlements473 (321) (86)Research and development credit(552) — —Excess tax benefits of stock-based compensation(6,851) (11,558) —Valuation allowances(8,537) 4,974 15Deductible domestic manufacturing costs— — (1,225)Tax legislation impact— (21,430) —Other73 360 238Income tax expense (benefit)$311 $(25,890) $(1,285)The tax legislation which became effective January 1, 2018, repealed corporate alternative minimum tax ("AMT") for tax years beginning January 1,2018 and provides that existing AMT credit carryovers are refundable beginning in 2018. At December 31, 2018 the Company had approximately $5.5million and $5.4 million of AMT credit carryovers reported in “Other receivables" and "Other long-term assets," respectively, on the consolidated balancesheets.84Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016The tax effect of temporary differences and net operating loss carryforwards that gave rise to the Company’s deferred tax assets and liabilities were asfollows (in thousands): December 31, 20182017Deferred tax assets: Net operating loss carryforwards$96,602 $111,416Accrued compensation5,526 4,586Deferred revenue3,700 1,638Tax credit carryforwards552 —Stock-based compensation3,971 3,592Capital loss23,008 22,579Other, net2,143 3,466Total gross deferred tax assets135,502 147,277Valuation allowance(100,705) (109,242)Deferred tax assets, net of valuation allowance34,797 38,035Deferred tax liabilities: Depreciation and amortization(74,135) (81,182)Other, net(1,056) (286)Total gross deferred tax liabilities(75,191) (81,468)Net deferred tax liabilities$(40,394) $(43,433)At December 31, 2018, the Company evaluated the need for a valuation allowance for certain deferred tax assets based upon its assessment of whether itis more likely than not that the Company will generate sufficient future taxable income necessary to realize the deferred tax benefits. The Company maintainsa valuation allowance against its deferred tax assets that are capital in nature to the extent that it is more likely than not that the related deferred tax benefitwill not be realized. The Company also has a deferred tax asset related to the net operating losses ("NOLs") that it believes are more likely than not to expirebefore utilization. If assumptions change and the Company determines it will be able to realize these NOLs, the tax benefit relating to any reversal of thevaluation allowance on deferred tax assets as of December 31, 2018 will be recognized as a reduction of income tax expense.The changes in the valuation allowance for deferred tax assets are shown below (in thousands): Years ended December 31, 2018 2017Balance at beginning of year$109,242 $226,813Decrease in valuation allowance - change in federal income tax rate— (72,482)Decrease in valuation allowance - adoption of ASU 2016-09— (50,203)Increase (decrease) in valuation allowance - current year utilization(8,597) 4,875Increase in valuation allowance - other60 239Balance at end of year$100,705 $109,242As of December 31, 2018, the Company’s U.S. federal and state net operating loss carryforwards for income tax purposes were $454.3 million and $20.8million, respectively, which primarily related to excess tax benefits for stock-based compensation. Prior to January 1, 2017, when the net operating losscarryforwards related to stock-based compensation were recognized, the income tax benefit of those losses was accounted for as a credit to stockholders’equity on the consolidated balance sheets. Beginning on January 1, 2017, we recognized such income tax benefit on the consolidated financial statements, asfurther described in the Recent accounting pronouncements section of "Note 2: Summary of Significant Accounting Policies." If not utilized, the Company’sfederal net operating loss carryforwards will expire between 2020 and 2037, with the85Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016majority of them expiring between 2020 and 2024. Additionally, changes in ownership, as defined by Section 382 of the Internal Revenue Code, may limitthe amount of net operating loss carryforwards used in any one year.A reconciliation of the unrecognized tax benefit balances is as follows (in thousands): Years ended December 31, 2018 2017 2016Balance at beginning of year$22,625 $22,919 $21,741Gross increases for tax positions of prior years516 93 331Gross decreases for tax positions of prior years— (31) (93)Gross increases for tax positions of current year— — 997Settlements with taxing authorities— (66) (57)Statute of limitations expirations(551) (290) —Balance at end of year$22,590 $22,625 $22,919The total amount of unrecognized tax benefits that could affect the Company’s effective tax rate if recognized was $4.7 million and $4.2 million as ofDecember 31, 2018 and 2017, respectively. The remaining $17.9 million and $18.4 million has not been recognized on the consolidated balance sheets as ofDecember 31, 2018 and 2017, respectively, and if recognized, would create a deferred tax asset subject to a valuation allowance. The Company and itssubsidiaries file income tax returns in the U.S. federal jurisdiction, various state jurisdictions, and Canada. With few exceptions, the Company is no longersubject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2014, although NOL carryforwards and taxcredit carryforwards from any year are subject to examination and adjustment for at least three years following the year in which they are fully utilized. As ofDecember 31, 2018, no significant adjustments have been proposed relative to the Company’s tax positions.During the years ended December 31, 2018, 2017, and 2016, the Company recognized less than $0.5 million of interest and penalties related touncertain tax positions. The Company had approximately $1.5 million and $1.1 million accrued for interest and penalties as of December 31, 2018 and 2017,respectively.Note 17:Net Income (Loss) Per Share"Basic net income (loss) per share" is computed using the weighted average number of common shares outstanding during the period. "Diluted netincome (loss) per share" is computed using the weighted average number of common shares outstanding plus the number of dilutive potential common sharesoutstanding during the period. Dilutive potential common shares consist of the incremental common shares issuable upon the exercise of outstanding stockoptions and the vesting of unvested RSUs. Dilutive potential common shares are excluded from the computation of earnings per share if their effect isantidilutive. The redemption value adjustment of the Company's redeemable noncontrolling interest is deducted from income (loss) (as discussed further in"Note 2: Summary of Significant Accounting Policies").86Table of ContentsNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)Years Ended December 31, 2018, 2017, and 2016The computation of basic and diluted net income (loss) per share attributable to Blucora, Inc. is as follows (in thousands): Years ended December 31, 2018 2017 2016Numerator: Income (loss) from continuing operations$51,569 $29,376 $(1,379)Net income attributable to noncontrolling interests(935) (2,337) (658)Adjustment of redeemable noncontrolling interests*(5,977) — —Income (loss) from discontinued operations attributable to Blucora, Inc.— — (63,121)Net income (loss) attributable to Blucora, Inc. shareholders after adjustment ofredeemable noncontrolling interests and discontinued operations$44,657 $27,039 $(65,158)Denominator: Weighted average common shares outstanding, basic47,394 44,370 41,494Dilutive potential common shares1,987 2,841 —Weighted average common shares outstanding, diluted49,381 47,211 41,494Net income (loss) per share attributable to Blucora, Inc. - basic: Continuing operations$0.94 $0.61 $(0.05)Discontinued operations— — (1.52)Basic net income (loss) per share$0.94 $0.61 $(1.57)Net income (loss) per share attributable to Blucora, Inc. - diluted: Continuing operations$0.90 $0.57 $(0.05)Discontinued operations— — (1.52)Diluted net income (loss) per share$0.90 $0.57 $(1.57)Shares excluded354 1,058 9,774* See "Note 2: Summary of Significant Accounting Policies" for further discussion of redeemable noncontrolling interestsShares were excluded from the computation of diluted earnings per common share for these periods because their effect would have been anti-dilutive.87Table of ContentsITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial DisclosureNone.ITEM 9A. Controls and ProceduresEvaluation of Disclosure Controls and ProceduresOur management evaluated, with the participation of our Chief Executive Officer and our Chief Financial Officer, the effectiveness of our disclosurecontrols and procedures as of the end of the period covered by this Annual Report on Form 10-K. Based on this evaluation, our Chief Executive Officer andour Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of December 31, 2018 to ensure that information weare required to disclose in reports that we file or submit under the Securities Exchange Act of 1934 is accumulated and communicated to our management,including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure, and that suchinformation is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission rules and forms.Management’s Report on Internal Control over Financial ReportingOur management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in ExchangeAct Rules 13a-15(f). Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherentlimitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to futureperiods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.Under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, we conducted anevaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework (2013framework) issued by the Committee of the Sponsoring Organizations of the Treadway Commission.Based on our evaluation under the framework in Internal Control – Integrated Framework (2013 framework), our management concluded that ourinternal control over financial reporting was effective as of December 31, 2018.Ernst & Young LLP has audited the effectiveness of our internal control over financial reporting as of December 31, 2018 and its report is includedbelow.Changes in Internal Control over Financial ReportingThere was no change in our internal control over financial reporting that occurred during the fourth quarter of 2018 that has materially affected, or isreasonably likely to materially affect, our internal control over financial reporting.88Table of ContentsReport of Independent Registered Public Accounting FirmTo the Stockholders and the Board of Directors of Blucora, Inc.Opinion on Internal Control over Financial ReportingWe have audited Blucora, Inc.’s internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control-IntegratedFramework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion,Blucora, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2018, based on theCOSO criteria.We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidatedbalance sheets of Blucora, Inc. as of December 31, 2018 and 2017, the related consolidated statements of comprehensive income (loss), stockholders' equityand cash flows for each of the three years in the period ended December 31, 2018, and the related notes, and our report dated March 1, 2019 expressed anunqualified opinion thereon.Basis for OpinionThe Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness ofinternal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Ourresponsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firmregistered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and theapplicable rules and regulations of the Securities and Exchange Commission and the PCAOB.We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether effective internal control over financial reporting was maintained in all material respects.Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing andevaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considerednecessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.Definition and Limitations of Internal Control Over Financial ReportingA company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal controlover financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are beingmade only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention ortimely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliancewith the policies or procedures may deteriorate./s/ Ernst & Young LLPDallas, TexasMarch 1, 2019ITEM 9B. Other InformationNone.89Table of ContentsPART IIIAs permitted by the rules of the Securities and Exchange Commission, we have omitted certain information from Part III of this Annual Report onForm 10-K. We intend to file a Definitive Proxy Statement (the "Proxy Statement") with the Securities and Exchange Commission relating to our annualmeeting of stockholders not later than 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K, and such information isincorporated by reference herein.ITEM 10. Directors, Executive Officers and Corporate GovernanceThe information required in response to this Item 10 is incorporated by reference herein to our Proxy Statement.ITEM 11. Executive CompensationThe information required in response to this Item 11 is incorporated by reference herein to our Proxy Statement.ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder MattersEquity Compensation Plan InformationOur stockholders have approved the Blucora, Inc. 2018 Long-Term Incentive Plan, (the "2018 Plan"), the Blucora, Inc. 2015 Plan, as amended and restated(the "2015 Plan"), the Company's Restated 1996 Flexible Stock Incentive Plan (the "1996 Plan"), and the Blucora, Inc. 2016 Employee Stock Purchase Plan(the “2016 ESPP”). Our Board of Directors adopted the 2016 Inducement Plan (the "Inducement Plan") on January 29, 2016, which did not requirestockholder approval under NASDAQ rules. The terms and conditions of the Inducement Plan are substantially similar to those of the 2015 Plan, except thatunder the Inducement Plan, 2,400,000 shares are authorized for issuance, eligibility is limited to newly hired employees, incentive stock options may not begranted, and the Inducement Plan is not subject to stockholder approval. The 1996 Plan and the 2015 Plan are now terminated, and no additional equitygrants may be made under those plans.See “Note 11: Stockholders' Equity” in the Notes to Consolidated Financial Statements included in Part II, Item 8, for additional information.The table below sets forth information regarding outstanding awards and shares available for future issuance under the Company’s equity compensationplans as of December 31, 2018. (a) (b) (c) Plan category Number of securities to beissued upon exercise ofoutstanding options,warrants, and rights Weighted-average exercise priceof outstanding options,warrants, and rights (1) Number of securities remainingavailable for future issuance underequity compensation plans(excluding securities reflected incolumn (a)) Equity compensation plans approved bystockholders 2,768,128 (2) $15.85 6,281,763 (3) Equity compensation plans not approved bystockholders 542,682 (4) $9.54 1,191,301 (5) Total 3,310,810 $14.62 7,473,064 90Table of Contents(1)Consists of the weighted-average exercise price of outstanding options, as outstanding restricted stock unit ("RSUs") do not have an exercise price.(2)Consists of 1,971,159 shares of common stock issuable upon exercise of outstanding options and 796,969 shares of common stock issuable uponvesting of RSUs under the 2018 Plan, the 2015 Plan, and 1996 Plan.(3)Includes 5,520,759 shares available for future grant under the 2018 Plan and 761,004 shares available for future grant under the 2016 ESPP. For themost current offering period that ended on November 14, 2018, 20,340 shares were issued under the 2016 ESPP. The 1996 Plan and the 2015 Plan wereterminated for purposes of future grants in May 2015 and June 2018, respectively. Does not include shares available for grant under the 2016Inducement Plan.(4)Consists of 476,780 shares of common stock issuable upon exercise of outstanding options and 65,902 shares of common stock issuable upon vestingof RSUs under the 2016 Inducement Plan.(5)Includes shares available for future grant under the 2016 Inducement Plan.Additional information required in response to this Item 12 is incorporated by reference herein to our Proxy Statement.ITEM 13. Certain Relationships and Related Transactions, and Director IndependenceThe information required in response to this Item 13 is incorporated by reference herein to our Proxy Statement.ITEM 14. Principal Accounting Fees and ServicesThe information required in response to this Item 14 is incorporated by reference herein to our Proxy Statement.91Table of ContentsPART IVITEM 15. Exhibits, Financial Statement Schedules(a)1. Consolidated Financial StatementsSee Index to Consolidated Financial Statements at Item 8 of this report.2. Financial Statement SchedulesAll financial statement schedules required by Item 15(a)(2) have been omitted because they are not applicable or the required information is presented inthe Consolidated Financial Statements or Notes thereto.3. ExhibitsThe exhibits required by Item 601 of Regulation S-K are set forth below.(b) Exhibits92Table of ContentsINDEX TO EXHIBITSExhibitNumber Exhibit Description Form Date of First Filing ExhibitNumberFiledHerewith2.1# Stock Purchase Agreement by an among HDV Holdings, LLC,Blucora, Inc., Project Baseball Sub, Inc. and HDV Holdings,Inc., dated October 14, 2015 8-K October 14, 2015 10.1 2.2# Asset Purchase Agreement between Blucora, Inc., InfospaceLLC, OpenMail LLC and InfoSpace Holdings LLC dated July1, 2016 8-K July 5, 2016 2.1 2.3# Stock Purchase Agreement between Blucora, Inc., MonopriceHoldings, Inc. and YFC-Boneagle Electric Co., LTD, datedNovember 14, 2016 8-K November 15, 2016 2.1 3.1 Restated Certificate of Incorporation, as filed with the Secretaryof the State of Delaware on August 10, 2012 8-K (No. 000-25131) August 13, 2012 3.1 3.2 Certificate of Amendment to the Restated Certificate ofIncorporation of Blucora, Inc. filed with the Secretary of Stateof Delaware on June 1, 2017 8-K June 5, 2017 3.1 3.3 Certificate of Amendment to the Restated Certificate ofIncorporation of Blucora, Inc. filed with the Secretary of Stateof Delaware on June 8, 2018 8-K June 8, 2018 3.1 3.4 Amended and Restated Bylaws of Blucora, Inc. 8-K February 28, 2017 3.2 10.1* Restated 1996 Flexible Stock Incentive Plan, as amended andrestated effective as of June 5, 2012 S-8 (No. 333-198645) September 8, 2014 99.1 10.2* Blucora, Inc. 2015 Incentive Plan, as Amended and Restated DEF 14A April 25, 2016 App-endix A 10.3* Form of Blucora, Inc. 2015 Incentive Plan Nonqualified StockOption Grant Notice 10-Q July 30, 2015 10.2 10.4* Form of Blucora, Inc. 2015 Incentive Plan Restricted Stock UnitGrant Notice 10-Q July 30, 2015 10.3 10.5* Form of Nonqualified Stock Option Agreement for ExecutiveOfficers under the Blucora, Inc. 2015 Incentive Plan, asamended and restated 8-K February 23, 2018 10.2 10.6* Form of Time-Based Restricted Stock Unit Agreement forExecutive Officers under the Blucora, Inc. 2015 Incentive Plan,as amended and restated 8-K February 23, 2018 10.3 10.7* Form of Performance-Based Restricted Stock Unit Agreementfor Executive Officers under the Blucora, Inc. 2015 IncentivePlan, as amended and restated 8-K February 23, 2018 10.4 10.8* Form of Nonqualified Stock Option Grant Notice andAgreement for Nonemployee Directors under the Blucora, Inc.2015 Incentive Plan 10-Q April 28, 2016 10.3 10.9* Form of Nonqualified Stock Option Grant Notice andAgreement for Nonemployee Chairman of the Board under theBlucora, Inc. 2015 Incentive Plan 10-Q April 28, 2016 10.4 10.10* Form of Director Restricted Stock Unit Grant Notice and AwardAgreement for Initial Grants to New Directors under theAmended and Restated Blucora, Inc. 2015 Incentive Plan 10-Q July 27, 2017 10.3 10.11* Form of Director Restricted Stock Unit Grant Notice and AwardAgreement for Annual Grants to Directors under the Amendedand Restated Blucora, Inc. 2015 Incentive Plan 10-Q July 27, 2017 10.4 10.12* Blucora, Inc. 2018 Long-Term Incentive Plan DEF 14A April 19, 2018 App-endix A 93Table of Contents10.13* Form of Nonqualified Stock Option Award Agreement forExecutive Officers under the Blucora, Inc. 2018 Long-TermIncentive Plan X10.14* Form of Time-Based Restricted Stock Unit Award Agreementfor Executive Officers under the Blucora, Inc. 2018 Long-TermIncentive Plan X10.15* Form of Performance-Based Restricted Stock Unit AwardAgreement for Executive Officers under the Blucora, Inc. 2018Long-Term Incentive Plan X10.16* Form of Director Restricted Stock Unit Grant Notice and AwardAgreement for Initial Grants to New Directors under theBlucora, Inc. 2018 Long-Term Incentive Plan 10-Q August 1, 2018 10.4 10.17* Form of Director Restricted Stock Unit Grant Notice and AwardAgreement for Annual Grants to Directors under Blucora, Inc.2018 Long-Term Incentive Plan 10-Q August 1, 2018 10.3 10.18* Blucora, Inc. 2016 Equity Inducement Plan S-8 January 29, 2016 99.1 10.19* Amendment No. 1 to Blucora, Inc. 2016 Inducement Plan S-8 October 14, 2016 99.1 10.20* Amendment No. 2 to the Blucora, Inc. 2016 Inducement Plan 8-K May 25, 2018 10.1 10.21* Form of Restricted Stock Unit Grant Notice and AwardAgreement for Initial Grants to Newly-Hired Executive OfficersUnder the Blucora, Inc. 2016 Equity Inducement Plan, asamended 10-Q October 31, 2018 10.2 10.22* Form of Blucora, Inc. 2016 Inducement Plan NonqualifiedStock Option Grant Notice 10-K February 24, 2016 10.41 10.23* Form of Blucora, Inc. 2016 Inducement Plan Restricted StockUnit Grant Notice 10-K February 24, 2016 10.42 10.25* Blucora, Inc. 2018 Annual Incentive Plan 8-K February 23, 2018 10.1 10.26* Employment Agreement between Blucora, Inc. and John S.Clendening dated March 12, 2016 8-K March 15, 2016 10.1 10.27* First Amendment to Employment Agreement dated September5, 2017 between Blucora, Inc. and John S. Clendening 8-K September 5, 2017 10.1 10.28* Employment Agreement by and between Blucora, Inc. andSanjay Baskaran dated January 12, 2017 8-K/A January 13, 2017 10.1 10.29* Employment Agreement by and between Blucora, Inc., HDVest, Inc., and Robert D. Oros dated January 22, 2017 8-K January 23, 2017 10.1 10.30* Employment Agreement by and between Blucora, Inc. and AnnBruder dated June 19, 2017 10-Q July 27, 2017 10.2 10.31* Employment Agreement by and between Blucora, Inc. andDavinder Athwal dated February 14, 2018 8-K February 15, 2018 10.1 10.32* Employment Agreement by and between Blucora, Inc. andTransient Taylor dated September 18, 2018 10-Q October 31, 2018 10.1 10.33* Employment Agreement by and between Blucora, Inc. andTodd Mackay dated December 24, 2018 X10.34* Employment Agreement by and between Blucora, Inc. andCurtis Campbell dated October 12, 2018 X94Table of Contents10.35* Employment Agreement by and between Blucora, Inc. andMike Hogan dated October 20, 2018 X10.36* Separation and Release Agreement by and between Blucora,Inc. and Bob Oros dated October 28, 2018 X10.37* Amended and Restated Employment Agreement, amended andrestated effective January 6, 2015 between Blucora, Inc. andEric M. Emans 8-K January 22, 2015 10.1 10.38* Amendment No. 1 to Amended and Restated EmploymentAgreement by and between Blucora, Inc. and Eric M. Emansdated January 22, 2016 8-K January 22, 2016 10.1 10.39* Amendment No. 2 to Amended and Restated EmploymentAgreement by and between Blucora, Inc. and Eric M. Emansdated January 6, 2015, as amended 10-Q October 27, 2016 10.4 10.40* Consulting Agreement, dated October 25, 2017, betweenBlucora, Inc. and Eric M. Emans 10-Q October 26, 2017 10.2 10.41 Credit Agreement, dated May 22, 2017, among Blucora, Inc., asborrower, and most of its direct and indirect domesticsubsidiaries, as guarantors, and Credit Suisse AG, CaymanIslands Branch, as administrative agent and collateral agent,and each lender from time to time a party to the CreditAgreement 8-K May 23, 2017 10.1 10.42 First Amendment, dated November 28, 2017, among Blucora,Inc., as borrower, and most of its direct and indirect domesticsubsidiaries, as guarantors, and Credit Suisse AG, CaymanIslands Branch, as administrative agent and collateral agent,and each lender party to the First Amendment 8-K November 29, 2017 10.1 10.43 Office Lease between Blucora, Inc. and Plaza Center PropertyLLC dated July 19, 2012 10-Q (No. 000-25131) November 1, 2012 10.2 10.44 First Amendment to Office Lease between Blucora, Inc. andPlaza Center Property LLC dated November 5, 2013 10-K February 27, 2014 10.8 10.45 Sublease dated April 13, 2017, by and between Blucora, Inc.and Xevo, Inc. related to that certain Office Lease dated July 13,2012 by and between Blucora, Inc. and KBS SOR PlazaBellevue, LLC (as successor to Plaza Property Center LLC) 10-Q May 4, 2017 10.5 10.46 Lease Agreement, dated January 28, 2008, by and between 2ndStory Software, Inc., PBI Properties, Larry Kane Investments,L.C., and Swati Dandekar for office space located at 1425 60thStreet NE, Suite 300, Cedar Rapids, Iowa 10-K (No. 000-25131) March 9, 2012 10.13 10.47 Amendment to Lease Agreement by and between 2nd StorySoftware, Inc., PBI Properties, Larry Kane Investments, L.C., andSwati Dandekar for office space located at 1425 60th Street NE,Suite 300, Cedar Rapids, Iowa, dated March 14, 2013 10-Q May 2, 2013 10.5 10.48* Blucora, Inc., 2016 Employee Stock Purchase Plan DEF 14A April 25, 2016 App-endix B 10.49* Amendment No. 1 to the Blucora, Inc. Employee StockPurchase Plan 10-Q August 1, 2018 99.1 10.50* Blucora, Inc. Non-Employee Director Compensation Policy 8-K June 5, 2017 10.1 10.51* Blucora, Inc. Director Tax-Smart Deferral Plan X10.52* Blucora, Inc. Executive Officer Tax-Smart Deferral Plan X21.1 Subsidiaries of the registrant X95Table of Contents23.1 Consent of Ernst & Young LLP, Independent Registered PublicAccounting Firm X24.1 Power of Attorney (contained on the signature page hereto) X31.1 Certification of Principal Executive Officer pursuant to Section302 of the Sarbanes-Oxley Act of 2002 X31.2 Certification of Principal Financial Officer pursuant to Section302 of the Sarbanes-Oxley Act of 2002 X32.1 Certification of Principal Executive Officer pursuant to Section906 of the Sarbanes-Oxley Act of 2002 X32.2 Certification of Principal Financial Officer pursuant to Section906 of the Sarbanes-Oxley Act of 2002 X101 The following financial statements from the Company’s 10-Kfor the fiscal year ended December 31, 2017, formatted inXBRL: (i) Consolidated Balance Sheets, (ii) ConsolidatedStatements of Comprehensive Income, (iii) ConsolidatedStatements of Stockholders’ Equity, (iv) ConsolidatedStatements of Cash Flows, and (v) Notes to ConsolidatedFinancial Statements X* Indicates a management contract or compensatory plan or arrangement.# Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. Blucora, Inc. herebyundertakes to furnish supplemental copies of any of the omitted schedules and exhibits upon request by the Securitiesand Exchange Commission. (c) Financial Statements and SchedulesSee Item 15(a) above.ITEM 16. Form 10-K SummaryNone.SIGNATURESPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to besigned on its behalf by the undersigned, thereunto duly authorized. BLUCORA, INC. By:/s/ John S. Clendening John S. ClendeningChief Executive Officer and President Date:March 1, 2019POWER OF ATTORNEYKNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Davinder Athwal and Ann J.Bruder, jointly and severally, his or her attorneys-in-fact, each with the power of substitution, for him or her in any and all capacities to execute anyamendments to this Annual Report on Form 10-K, and to file the same, exhibits thereto and other documents in connection therewith, with the Securities andExchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may lawfully do or cause to bedone by virtue hereof.Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of theregistrant and in the capacities indicated and on the dates indicated.96Table of ContentsSignature TitleDate /s/ John S. Clendening President, Chief Executive Officer, and Director(Principal Executive Officer)March 1, 2019John S. Clendening /s/ Davinder Athwal Chief Financial Officer(Principal Financial Officer)March 1, 2019Davinder Athwal /s/ John Palmer Vice President - Accounting(Principal Accounting Officer)March 1, 2019John Palmer /s/ William L. Atwell Chairman and DirectorMarch 1, 2019William L. Atwell /s/ Steven Aldrich DirectorMarch 1, 2019Steven Aldrich /s/ Lance G. Dunn DirectorMarch 1, 2019Lance G. Dunn /s/ E.Carol Hayles DirectorMarch 1, 2019E. Carol Hayles /s/ H. McIntyre Gardner DirectorMarch 1, 2019H. McIntyre Gardner /s/ John MacIlwaine DirectorMarch 1, 2019John MacIlwaine /s/ Georganne C. Proctor DirectorMarch 1, 2019Georganne C. Proctor /s/ Christopher W. Walters DirectorMarch 1, 2019Christopher W. Walters /s/ Mary S. Zappone DirectorMarch 1, 2019Mary S. Zappone Exhibit 10.13BLUCORA, INC. 2018 LONG-TERM INCENTIVE PLANNONQUALIFIED STOCK OPTION GRANT NOTICETO: (the “Participant” or “you”)FROM: Blucora, Inc., a Delaware corporation (the “Company”)You are hereby granted by the Company a Stock Option (the “Option”) to purchase shares of the Company’s Common Stock(“Shares”) pursuant to the Blucora, Inc. 2018 Long-Term Incentive Plan (the “Incentive Plan”).The Option is subject to all the terms and conditions set forth in this Nonqualified Stock Option Grant Notice (the “Notice of Grant”)and in the Stock Option Agreement attached hereto as Exhibit A (the “Agreement”) and the Incentive Plan, each of which areincorporated by reference into this Notice of Grant. Capitalized terms that are not defined in the Notice of Grant shall have themeanings given to them in the Agreement, and if not defined in the Agreement, the meanings given to them in the Incentive Plan.Date of Grant: Option Number: Number of Shares: Exercise Price per Share: Option Expiration Date: Vesting Commencement Date: Type of Option: Nonqualified Stock Option Vesting and Exercisability Schedule: Except as specifically provided in the Agreement and subject to the restrictions andconditions set forth in the Incentive Plan, the Option shall vest and become exercisable as follows:(i)one-third (1/3) of the Option (rounded down to the nearest whole Share) shall vest and become exercisable on thefirst anniversary of the Vesting Commencement Date, provided that you are employed by or providing services tothe Company or a Related Company on that date;(ii)an additional one-third (1/3) of the Option (rounded down to the nearest whole Share) shall vest and becomeexercisable on the second anniversary of the Vesting Commencement Date, provided that you are employed by orproviding services to the Company or a Related Company on that date; and(iii)the remaining one-third (1/3) of the Option shall vest and become exercisable on the third anniversary of the VestingCommencement Date, provided that you are employed by or providing services to the Company or a RelatedCompany on that date.Vesting will cease upon your Termination of Service and the unvested portion of the Option will immediately terminate.Notwithstanding the foregoing, upon the occurrence of a Termination of Service due to (i) your death or Total and PermanentDisability, to the extent not already vested, the Option shall become fully vested and exercisable as of the date of such Terminationof Service; or (ii) your Retirement on or after the first anniversary of the Date of Grant, to the extent not already vested, the Optionshall become fully vested and exercisable as of the date of such Termination of Service. For purposes of this Option, the term“Retirement” shall mean your voluntary Termination of Service on or after your attainment of (i) age sixty (60) and five (5) years ofservice with the Company or any Related Company, (ii) age fifty-five (55) and ten (10) years of service with the Company or anyRelated Company, or (iii) any age with twenty (20) years of service with the Company or any Related Company; provided,however, that if at any time the Committee determines that your Termination of Service should be a Termination of Service forCause, then your Termination of Service will no longer be due to your Retirement and the Option shall immediately be forfeited.Additional Terms/Acknowledgment: You acknowledge and agree that the Notice of Grant and the vesting and exercisabilityschedule set forth herein do not constitute an express or implied promise of your continued engagement as an employee, officer,director or other service provider for the vesting period, for any period, or at all, and shall not interfere with your right or theCompany’s right to terminate your employment or service relationship with the Company or its Related Companies at any time,with or without Cause. For purposes of this Option, the term “Cause” shall have the meaning set forth in your EmploymentAgreement (as defined below), provided that if such Employment Agreement does not define such term or no agreement is then ineffect, then it shall mean dishonesty, fraud, serious or willful misconduct, unauthorized use or disclosure of confidential informationor trade secrets, or conduct prohibited by law (except minor violations), in each case as determined by the Committee, whosedetermination shall be conclusive and binding.-2-Employment Agreement: If there is a written employment agreement in effect between you and the Company (the “EmploymentAgreement”), then the Option shall be subject to the terms of such Employment Agreement, so long as such EmploymentAgreement remains in effect (as it may be amended, supplemented or restated from time to time) and the terms set forth in theEmployment Agreement are applicable to the Option.Committee Decisions/Interpretations: You hereby agree to accept as binding, conclusive and final all decisions or interpretationsof the Committee upon any questions relating to the Incentive Plan and the Option.* * * * * * *[Remainder of Page Intentionally Left BlankSignature Page Follows.]-3-By your signature below or electronic acceptance, you agree that the Notice of Grant, the Agreement and the EmploymentAgreement (if applicable), and the Incentive Plan, constitute your entire agreement with respect to the Option, and exceptas set forth therein, may not be modified except by means of a writing signed by the Company and you. This Notice ofGrant and Agreement may be executed and/or accepted electronically and/or executed in duplicate counterparts, theproduction of either of which (including a signature or proof of electronic acceptance) shall be sufficient for all purposesfor the proof of the binding terms of this Option.BLUCORA, INC.By:___________________________Its: ___________________________ PARTICIPANT______________________________SignatureDate:__________________________ Attachments:1. Stock Option Agreement2. Incentive Plan Signature Page to Notice of GrantEXHIBIT ABLUCORA, INC. 2018 LONG-TERM INCENTIVE PLANSTOCK OPTION AGREEMENT1.Grant. The Company hereby grants to the Participant listed on the Notice of Grant (the “Participant”) an Option topurchase the number of Shares and at the exercise price as set forth in the Notice of Grant and subject to the terms and conditionsin this Stock Option Agreement (this “Agreement”) and the Incentive Plan. Unless otherwise defined herein, the capitalized termsused herein shall have the meanings given to them in the Notice of Grant, and if not defined in the Notice of Grant, the meaningsgiven to them in the Incentive Plan.2. Company’s Obligation. Unless and until the Option vests and is exercised, the Participant will have no right to receiveShares under the Option. Prior to actual distribution of Shares pursuant to any vested and exercised Option, such Option willrepresent an unsecured obligation of the Company.3. Vesting and Exercisability. Subject to Paragraph 4 hereof and to any other relevant Incentive Plan provisions, theOption will vest and become exercisable as provided in the Notice of Grant. Any portion of the Option that is vested may beexercised at any time during the period prior to the date the Option terminates. No partial exercise of the Option may be for lessthan five percent (5%) of the total number of Shares then available under the Option. In no event shall the Company be required toissue fractional Shares.4. Termination of Option. The unvested portion of the Option will terminate automatically and without further noticeimmediately upon the Participant’s Termination of Service (voluntary or involuntary). The vested portion of the Option will terminateautomatically and without further notice on the earliest of the dates set forth below:a. three (3) months after the Participant’s Termination of Service for any reason other than Retirement, death orTotal and Permanent Disability;b. one (1) year after the Participant’s Termination of Service by reason of Retirement, death or Total andPermanent Disability;c. immediately upon notification to the Participant of the Participant’s Termination of Service for Cause, unless theCommittee determines otherwise. If the Participant’s employment or service relationship is suspended pending an investigation ofwhether he or she will be terminated for Cause, all of the Participant’s rights under the Option likewise will be suspended during theperiod of investigation. If any facts that would constitute termination for Cause are discovered after the Participant’s Termination ofService, any Option the Participant then holds may be immediately terminated by the Committee; orA-1d. the Option Expiration Date.IT IS THE PARTICIPANT’S RESPONSIBILITY TO BE AWARE OF THE DATE ON WHICH THE OPTION TERMINATES.5. Leave of Absence. The effect of a Company-approved leave of absence on the terms and conditions of the Option willbe determined by the Committee, subject to applicable laws.6. Method of Exercise. The Participant may exercise the Option by giving written notice to the Company, in form andsubstance satisfactory to the Company, which will state the election to exercise the Option, the date of exercise thereof, and thenumber of Shares for which the Participant is exercising the Option. The written notice must be accompanied by full payment of theexercise price for the number of Shares that are being purchased (plus any employment tax withholding or other tax payment duewith respect to the exercise of the Option).7. Form of Payment of Exercise Price. The Participant may pay the Option exercise price, in whole or in part, (a) incash; (b) by wire transfer or check acceptable to the Company; (c) if permitted by the Committee, having the Company withholdShares that would otherwise be issued on exercise of the Option that have an aggregate Fair Market Value equal to the aggregateexercise price of the Shares being purchased under the Option; (d) if permitted by the Committee, tendering (either actually or, solong as the Shares are registered under Section 12(b) or 12(g) of the Exchange Act, by attestation) Shares owned by theParticipant that have an aggregate Fair Market Value equal to the aggregate exercise price of the Shares being purchased underthe Option; (e) unless the Committee determines otherwise and so long as the Shares are registered under Section 12(b) or 12(g)of the Exchange Act, and to the extent permitted by law, by delivery of a properly executed exercise agreement or notice, togetherwith irrevocable instructions to a brokerage firm designated or approved by the Company to promptly deliver to the Company theaggregate amount of proceeds to pay the Option exercise price; or (e) such other consideration as the Committee may permit.8. Withholding Taxes. As a condition to the exercise of any portion of the Option, the Participant must make sucharrangements as the Company may require for the satisfaction of any federal, state or local withholding tax obligations that mayarise in connection with such exercise. The Company may permit or require the Participant to satisfy all or part of the Participant’stax withholding obligations by (a) paying cash to the Company or a Related Company, as applicable; (b) having the Company or aRelated Company, as applicable, withhold an amount from any cash amounts otherwise due or to become due from the Companyor a Related Company, as applicable, to the Participant; (c) having the Company withhold a number of Shares that would otherwisebe issued to the Participant having a Fair Market Value equal to the tax withholding obligations; (d) surrendering a number ofShares the Participant already owns having a Fair Market Value equal to the tax withholding obligations; or (e) any combination of(a), (b), (c) or (d) above. The value of the Shares so withheld or tendered may not exceed the employer’s minimum required taxwithholding rate.A-29. Limited Transferability; Who May Exercise. The Option may not be sold, assigned, pledged (as collateral for a loan oras security for the performance of an obligation or for any other purpose) or transferred by the Participant or made subject toattachment or similar proceedings otherwise than by will or by the applicable laws of descent and distribution, except to the extentthe Participant designates one or more beneficiaries on a Company-approved form who may exercise the Option after theParticipant’s death. Notwithstanding the foregoing, the Committee, in its sole discretion, may permit the Participant to assign ortransfer the Option, subject to such terms and conditions as specified by the Committee. During the Participant’s lifetime only theParticipant may exercise the Option. The Option may be exercised by the personal representative of the Participant’s estate or thebeneficiary thereof following the Participant’s death.10. Regulatory Restrictions on Issuance of Shares Notwithstanding the other provisions of this Agreement, if at anytime the Company determines, in its sole discretion, that the listing, registration or qualification of Shares upon any securitiesexchange or under any state or federal law, or the consent or approval of any governmental regulatory authority is necessary ordesirable as a condition to the issuance of Shares to the Participant (or his or her estate), such issuance will not occur unless anduntil such listing, registration, qualification, consent or approval will have been effected or obtained free of any conditions notacceptable to the Company. The Company shall be under no obligation to the Participant to register for offering or resale or toqualify for exemption under the Securities Act, or to register or qualify under the laws of any state or foreign jurisdiction, anyShares, security or interest in a security paid or issued under, or created by, the Incentive Plan, or to continue in effect any suchregistrations or qualifications if made.11. Participant’s Representations. Notwithstanding any of the provisions hereof, the Participant hereby agrees that theParticipant will not exercise the Option, and that the Company will not be obligated to issue any Shares to the Participant if theexercise thereof or the issuance of such Shares shall constitute a violation by the Participant or the Company of any provision ofany law or regulation of any governmental authority. Any determination in this connection by the Committee shall be final, binding,and conclusive. The obligations of the Company and the rights of the Participant are subject to all applicable laws, rules, andregulations.12. Investment Representation. Unless the Shares are issued to the Participant in a transaction registered underapplicable federal and state securities laws, the Participant represents and warrants to the Company that all Shares which may bepurchased hereunder will be acquired by the Participant for investment purposes for his or her own account and not with any intentfor resale or distribution in violation of federal or state securities laws. Unless the Shares are issued to the Participant in atransaction registered under the applicable federal and state securities laws, at the option of the Company, a stop-transfer orderagainst the Shares may be placed on the official stock books and records of the Company, and a legend indicating that suchShares may not be pledged, sold or otherwise transferred, unless an opinion of counsel is provided (concurred in by counsel for theCompany) stating that such transfer is not in violation of any applicable law or regulation, may be stamped on stock certificates toensure exemption from registration. TheA-3Company may require such other action or agreement by the Participant as may from time to time be necessary to comply withthe federal, state and foreign securities laws.13. Binding Agreement. Subject to the limitation on the transferability of the Option contained herein, this Agreement willbe binding upon and inure to the benefit of the parties hereto and their respective heirs, legatees, legal representatives, successorsand assigns.14. No Stockholder Rights. Neither the Participant nor any person entitled to exercise the Participant’s rights in the eventof the Participant’s death shall have any of the rights of a stockholder with respect to the Shares subject to the Option unless anduntil the date of issuance under the Incentive Plan of any such Shares upon the exercise of the Option. Except as otherwiseprovided in Paragraph 15 hereof, no adjustment shall be made for dividends or other rights for which the record date is prior to theissuance of any Shares subject to the Option. The Participant agrees to execute any documents requested by the Company inconnection with the issuance of any Shares.15. Adjustments. The number of Shares covered by the Option, and the exercise price thereof, shall be subject toadjustment in accordance with Article 11 of the Incentive Plan.16. Notices. Any notice which either party hereto may be required or permitted to give to the other shall be in writing andmay be delivered personally, by interoffice mail, by fax, by electronic mail or other electronic means, or via a postal service,postage prepaid, to such electronic mail or postal address and directed to such person as the Company may notify the Participantfrom time to time; and to the Participant at the Participant’s electronic mail or postal address as shown on the records of theCompany from time to time, or at such other electronic mail or postal address as the Participant, by notice to the Company, maydesignate in writing from time to time.17. Committee Authority; Decisions Conclusive and Binding. The Participant acknowledges that a copy of theIncentive Plan has been made available for his or her review by the Company, and represents that he or she is familiar with theterms and provisions thereof, and hereby accepts the Award subject to all the terms and provisions thereof. The Committee willhave the power to interpret this Agreement, the Notice of Grant and the Incentive Plan, and to adopt such rules for theadministration, interpretation and application of the Incentive Plan as are consistent therewith and to interpret or revoke any suchrules. The Participant hereby agrees to accept as binding, conclusive, and final all decisions of the Committee upon any questionsarising under the Incentive Plan, this Agreement or the Notice of Grant. No member of the Committee will be personally liable forany action, determination or interpretation made in good faith with respect to the Incentive Plan, this Agreement or the Notice ofGrant.18. No Effect on Employment or Service Relationship. Nothing in the Incentive Plan or any Award granted under theIncentive Plan will be deemed to constitute an employment or service contract or confer or be deemed to confer any right for theParticipant to continue in the employ or service of, or to continue any other relationship with, the Company or any RelatedA-4Company or limit in any way the right of the Company or any Related Company to terminate the Participant’s employment or otherservice relationship at any time, with or without Cause.19. No Right to Damages. The Participant will have no right to bring a claim or to receive damages if the Participant isrequired to exercise the vested portion of the Option within three (3) months (or one (1) year in the case of Retirement, Total andPermanent Disability or death) of the Participant’s Termination of Service or if any portion of the Option is cancelled or expiresunexercised. The loss of existing or potential profit in the Option will not constitute an element of damages in the event of theParticipant’s Termination of Service for any reason even if the termination is in violation of an obligation of the Company or aRelated Company to the Participant.20. Claims. The Participant’s sole remedy for any Claim shall be against the Company, and the Participant shall not haveany claim or right of any nature against any Related Company (including, without limitation, any parent, subsidiary or affiliate of theCompany) or any stockholder or existing or former director, officer or employee of the Company or any Related Company. Theforegoing individuals and entities (other than the Company) shall be third-party beneficiaries of this Agreement for purposes ofenforcing the terms of this Paragraph 20.21. Covenants and Agreements as Independent Agreements. Each of the covenants and agreements that is set forthin this Agreement shall be construed as a covenant and agreement independent of any other provision of this Agreement. Theexistence of any claim or cause of action of the Participant against the Company, whether predicated on this Agreement orotherwise, shall not constitute a defense to the enforcement by the Company of the covenants and agreements that are set forth inthis Agreement.22. Section 409A. The Option is intended to be exempt from the requirements of Section 409A or to satisfy thoserequirements, and shall be construed accordingly.23. Governing Law; Venue. The validity, interpretation, construction and performance of this Agreement shall begoverned by the internal substantive laws of the State of Delaware, without reference to any choice-of-law rules. The Participantirrevocably consents to the nonexclusive jurisdiction and venue of the state and federal courts located in Dallas County, the Stateof Texas.24. Recovery of Compensation. In accordance with Section 6.13 of the Incentive Plan, the Company may recoup all orany portion of any Shares paid to the Participant in connection with the Option, as set forth in the Company’s clawback policy, ifany, approved by the Board from time to time.25. Conflicting Terms; Incentive Plan Governs. This Agreement and the Notice of Grant are subject to all terms andprovisions of the Incentive Plan. In the event of a conflict between one or more provisions of this Agreement or the Notice of Grantand one or more provisions of the Incentive Plan, the provisions of the Incentive Plan will govern.A-526. Entire Agreement. This Agreement together with the Notice of Grant and the Incentive Plan supersede any and allother prior understandings and agreements, either oral or in writing, between the parties with respect to the subject matter hereofand constitute the sole and only agreements between the parties with respect to the said subject matter. All prior negotiations andagreements between the parties with respect to the subject matter hereof are merged into this Agreement and the Notice of Grant.Each party to this Agreement and the Notice of Grant acknowledges that no representations, inducements, promises, oragreements, orally or otherwise, have been made by any party or by anyone acting on behalf of any party, which are not embodiedin this Agreement, the Notice of Grant or the Incentive Plan and that any agreement, statement, or promise that is not contained inthis Agreement, the Notice of Grant or the Incentive Plan shall not be valid or binding or of any force or effect. Notwithstandinganything to the contrary contained in the Notice of Grant, this Agreement or in the Incentive Plan, in the event of any conflictbetween the terms and conditions of the Option as set forth in the Notice of Grant, this Agreement and in the Incentive Plan, as thecase may be, and the terms and conditions of the Employment Agreement, the terms and conditions of the EmploymentAgreement shall govern unless the conflicting provision in the Notice of Grant, this Agreement or in the Incentive Plan, as the casemay be, is more favorable to the Participant; in which case, the provision more favorable to the Participant shall govern; provided,however, that notwithstanding the foregoing, in no event shall any extended exercise period set forth in the Employment Agreementmodify or extend the Option Expiration Date as set forth in the Notice of Grant.27. Legal Construction. In the event that any one or more of the terms, provisions, or agreements that are contained inthis Agreement shall be held by a court of competent jurisdiction to be invalid, illegal, or unenforceable in any respect for anyreason, the invalid, illegal, or unenforceable term, provision, or agreement shall not affect any other term, provision, or agreementthat is contained in this Agreement, and this Agreement shall be construed in all respects as if the invalid, illegal, or unenforceableterm, provision, or agreement had never been contained herein.28. Headings. The headings that are used in this Agreement are used for reference and convenience purposes only anddo not constitute substantive matters to be considered in construing the terms and provisions of this Agreement.29. Gender and Number. Words of any gender used in this Agreement shall be held and construed to include any othergender, and words in the singular number shall be held to include the plural, and vice versa, unless the context requires otherwise.30. Modification. No change or modification of this Agreement or the Notice of Grant shall be valid or binding upon theparties unless the change or modification is in writing and signed by the parties; provided, however, that the Company may changeor modify this Agreement or the Notice of Grant without the Participant’s consent or signature if the Company determines, in itssole discretion, that such change or modification is necessary for purposes of compliance with or exemption from the requirementsof Section 409A of the Code or any regulations or other guidanceA-6issued thereunder. Notwithstanding the preceding sentence, the Company may amend the Incentive Plan to the extent permittedby the Incentive Plan.A-7Exhibit 10.14BLUCORA, INC. 2018 LONG-TERM INCENTIVE PLANRESTRICTED STOCK UNIT GRANT NOTICE(TIME-BASED RESTRICTED STOCK UNITS)TO: (the “Participant” or “you”)FROM: Blucora, Inc., a Delaware corporation (the “Company”)You are hereby granted by the Company a Restricted Stock Unit Award (the “Award”) under the Blucora, Inc. 2018 Long-TermIncentive Plan (the “Incentive Plan”). Each restricted stock unit (an “RSU”) subject to the Award has a notional value equivalent toone share of the Company’s Common Stock for purposes of determining the number of shares of Common Stock (the “Shares”)subject to the Award.The Award is subject to all the terms and conditions set forth in this Restricted Stock Unit Grant Notice (the "Notice of Grant") andin the Restricted Stock Unit Agreement attached hereto as Exhibit A (the “Agreement”) and the Incentive Plan, each of which areincorporated by reference into this Notice of Grant. Capitalized terms that are not defined in the Notice of Grant shall have themeanings given to them in the Agreement, and if not defined in the Agreement, the meanings given to them in the Incentive Plan.Date of Grant: Award Number: Number of RSUs Subject to the Award: Vesting Commencement Date: Vesting Schedule: Except as specifically provided in the Agreement and subject to the restrictions and conditions set forth in theIncentive Plan, the RSUs shall vest as follows:(i)one-third (1/3) of the RSUs (rounded down to the nearest whole unit) shall vest on the first anniversary of theVesting Commencement Date, provided that you are employed by or providing services to the Company or aRelated Company on that date;(ii)an additional one-third (1/3) of the RSUs (rounded down to the nearest whole unit) shall vest on the secondanniversary of the Vesting Commencement Date, provided that you are employed by or providing services to theCompany or a Related Company on that date; and(iii)the remaining one-third (1/3) of the RSUs shall vest on the third anniversary of the Vesting Commencement Date,provided that you are employed by or providing services to the Company or a Related Company on that date.Vesting will cease upon your Termination of Service and the unvested portion of the Award will immediately terminate.Notwithstanding the foregoing, to the extent not already vested, upon the occurrence of a Termination of Service due to (a) yourdeath or Total and Permanent Disability, the RSUs shall become fully vested as of the date of such Termination of Service; or (b)your Retirement on or after the first anniversary of the Date of Grant, the RSUs shall become fully vested as of the date of suchTermination of Service. For purposes of this Award, the term “Retirement” shall mean your voluntary Termination of Service on orafter your attainment of (i) age sixty (60) and five (5) years of service with the Company or any Related Company, (ii) age fifty-five(55) and ten (10) years of service with the Company or any Related Company, or (iii) any age with twenty (20) years of servicewith the Company or any Related Company; provided, however, that if at any time the Committee determines that yourTermination of Service should be a Termination of Service for Cause (as defined below), then your Termination of Service will nolonger be due to your Retirement and all RSUs shall immediately be forfeited. For purposes of this Award, the term “Cause” shallhave the meaning set forth in your Employment Agreement (as defined below), provided that, if such Employment Agreement doesnot define such term or no such agreement is then in effect, then it shall mean dishonesty, fraud, serious or willful misconduct,unauthorized use or disclosure of confidential information or trade secrets, or conduct prohibited by law (except minor violations), ineach case as determined by the Committee, whose determination shall be conclusive and binding.Additional Terms/Acknowledgment: You acknowledge and agree that the Notice of Grant and the vesting schedule set forthherein do not constitute an express or implied promise of your continued engagement as an employee, officer, director or otherservice provider for the vesting period, for any period, or at all, and shall not interfere with your right or the Company’s right toterminate your employment or service relationship with the Company or its Related Companies at any time, with or without Cause.Employment Agreement: If there is a written employment agreement in effect between you and the Company or a RelatedCompany (the “Employment Agreement”), then the Award shall be subject to the terms of such Employment Agreement, so longas such Employment Agreement-2-remains in effect (as it may be amended, supplemented or restated from time to time) and the terms set forth in the EmploymentAgreement are applicable to the Award.Committee Decisions/Interpretations: You hereby agree to accept as binding, conclusive and final all decisions or interpretationsof the Committee upon any questions relating to the Incentive Plan and the Award.* * * * * * *[Remainder of Page Intentionally Left BlankSignature Page Follows.]-3-By your signature below or electronic acceptance, you agree that the Notice of Grant, the Agreement, the Incentive Plan,and the Employment Agreement (if applicable), constitute your entire agreement with respect to the Award, and except asset forth therein, may not be modified except by means of a writing signed by the Company and you. This Notice of Grantand Agreement may be executed and/or accepted electronically and/or executed in duplicate counterparts, the productionof either of which (including a signature or proof of electronic acceptance) shall be sufficient for all purposes for theproof of the binding terms of this Award.BLUCORA, INC.By: _______________________Its: _______________________ PARTICIPANT_____________________________SignatureDate: ________________________ Attachments:1. Restricted Stock Unit Agreement2. Incentive Plan Signature Page to Notice of GrantEXHIBIT ABLUCORA, INC. 2018 LONG-TERM INCENTIVE PLANRESTRICTED STOCK UNIT AGREEMENT1.Grant. The Company hereby grants to the Participant listed on the Notice of Grant (the “Participant”) an Award ofRSUs, as set forth in the Notice of Grant and subject to the terms and conditions in this Restricted Stock Unit Agreement (this“Agreement”) and the Incentive Plan. Unless otherwise defined herein, the capitalized terms used herein shall have the meaningsgiven to them in the Notice of Grant, and if not defined in the Notice of Grant, the meanings given to them in the Incentive Plan.2. Company’s Obligation. Each RSU represents the right to receive a Share on the vesting date. Unless and until theRSUs vest, the Participant will have no right to receive Shares under such RSUs. Prior to actual distribution of Shares pursuant toany vested RSUs, such RSUs will represent an unsecured obligation of the Company.3. Vesting Schedule. Subject to Paragraph 4 hereof and to any other relevant Incentive Plan provisions, the RSUsawarded by this Agreement will vest according to the vesting schedule specified in the Notice of Grant. The effect of a Companyapproved unpaid leave of absence on the terms and conditions of the RSUs will be determined by the Committee, subject toapplicable laws.4. Forfeiture upon Termination of Service. Except as provided in the Notice of Grant, if the Participant has aTermination of Service for any or no reason prior to vesting, the unvested RSUs awarded by this Agreement will thereupon beforfeited at no cost to the Company.5. Payment After Vesting. Subject to Paragraph 21 hereof, any RSUs that vest in accordance with Paragraph 3 will bepaid to the Participant (or in the event of the Participant’s death, to his or her estate) in Shares on, or as soon as practicable after,the applicable vesting date (but in any event, within sixty (60) days of the date on which the RSUs vest).6. Withholding Taxes. As a condition to the payment of any vested RSUs, the Participant must make such arrangementsas the Company may require for the satisfaction of any federal, state or local withholding tax obligations that may arise inconnection with such payment. The Company may permit or require the Participant to satisfy all or part of the Participant’s taxwithholding obligations by (a) paying cash to the Company or a Related Company, as applicable; (b) having the Company or aRelated Company, as applicable, withhold an amount from any cash amounts otherwise due or to become due from the Companyor a Related Company, as applicable, to the Participant; (c) having the Company withhold a number of Shares that would otherwisebe issued to the Participant having a Fair Market Value equal to the tax withholding obligations; (d) surrendering a number ofShares the Participant already owns having a Fair Market Value equalA-1to the tax withholding obligations; or (e) any combination of (a), (b), (c) or (d) above. The value of the Shares so withheld ortendered may not exceed the employer’s minimum required tax withholding rate.7. Payments After Death. Any distribution or delivery to be made to the Participant under this Agreement will, if theParticipant is then deceased, be made to the administrator or executor of the Participant’s estate. Any such administrator orexecutor must furnish the Company with (a) written notice of his or her status as transferee and (b) evidence satisfactory to theCompany to establish the validity of the transfer and compliance with any laws or regulations pertaining to said transfer.8. Rights as Stockholder. Neither the Participant nor any person claiming under or through the Participant will have anyof the rights or privileges of a stockholder of the Company in respect of any Shares deliverable hereunder unless and until the dateof issuance of any such Shares under the Incentive Plan. Except as otherwise provided in Paragraph 9, no adjustment shall bemade for dividends or other rights for which the record date is prior to the issuance of any Shares subject to the Award. TheParticipant agrees to execute any documents requested by the Company in connection with the issuance of any Shares.9. Adjustments. The number of Shares covered by the Award shall be subject to adjustment in accordance with Article 11of the Incentive Plan.10. No Effect on Employment or Service Relationship. Nothing in the Incentive Plan or any Award granted under theIncentive Plan will be deemed to constitute an employment or service contract or confer or be deemed to confer any right for theParticipant to continue in the employ or service of, or to continue any other relationship with, the Company or any RelatedCompany or limit in any way the right of the Company or any Related Company to terminate the Participant’s employment or otherservice relationship at any time, with or without Cause.11. Notices. Any notice which either party hereto may be required or permitted to give to the other shall be in writing andmay be delivered personally, by interoffice mail, by fax, by electronic mail or other electronic means, or via a postal service,postage prepaid, to such electronic mail or postal address and directed to such person as the Company may notify the Participantfrom time to time; and to the Participant at the Participant’s electronic mail or postal address as shown on the records of theCompany from time to time, or at such other electronic mail or postal address as the Participant, by notice to the Company, maydesignate in writing from time to time.12. Award Is Not Transferable. Except to the limited extent provided in Paragraph 7, the Award and the rights andprivileges conferred hereby may not be transferred, assigned, pledged (as collateral for a loan or as security for the performance ofan obligation or for any other purpose) or hypothecated in any way (whether by operation of law or otherwise) and may not besubject to sale under execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate orotherwise dispose of the Award, or any right or privilege conferred hereby, or uponA-2any attempted sale under any execution, attachment or similar process, the Award and the rights and privileges conferred herebyimmediately will become null and void.13. Binding Agreement. Subject to the limitation on the transferability of the Award contained herein, this Agreement willbe binding upon and inure to the benefit of the parties hereto and their respective heirs, legatees, legal representatives, successorsand assigns.14. Regulatory Restrictions on Issuance of Shares. Notwithstanding the other provisions of this Agreement, if at anytime the Company determines, in its sole discretion, that the listing, registration or qualification of Shares upon any securitiesexchange or under any state or federal law, or the consent or approval of any governmental regulatory authority is necessary ordesirable as a condition to the issuance of Shares to the Participant (or his or her estate), such issuance will not occur unless anduntil such listing, registration, qualification, consent or approval will have been effected or obtained free of any conditions notacceptable to the Company. The Company shall be under no obligation to the Participant to register for offering or resale or toqualify for exemption under the Securities Act, or to register or qualify under the laws of any state or foreign jurisdiction, anyShares, security or interest in a security paid or issued under, or created by, the Incentive Plan, or to continue in effect any suchregistrations or qualifications if made.15. Participant’s Representations. Notwithstanding any of the provisions hereof, the Participant hereby agrees that theCompany will not be obligated to issue any Shares to the Participant if the issuance of such Shares shall constitute a violation bythe Participant or the Company of any provision of any law or regulation of any governmental authority. Any determination in thisconnection by the Committee shall be final, binding, and conclusive. The obligations of the Company and the rights of theParticipant are subject to all applicable laws, rules, and regulations.16. Investment Representation. Unless the Shares are issued to the Participant in a transaction registered underapplicable federal and state securities laws, the Participant represents and warrants to the Company that all Shares which may beissued hereunder will be acquired by the Participant for investment purposes for his or her own account and not with any intent forresale or distribution in violation of federal or state securities laws. Unless the Shares are issued to the Participant in a transactionregistered under the applicable federal and state securities laws, at the option of the Company, a stop-transfer order against theShares may be placed on the official stock books and records of the Company, and a legend indicating that such Shares may notbe pledged, sold or otherwise transferred, unless an opinion of counsel is provided (concurred in by counsel for the Company)stating that such transfer is not in violation of any applicable law or regulation, may be stamped on stock certificates to ensureexemption from registration. The Company may require such other action or agreement by the Participant as may from time totime be necessary to comply with the federal, state and foreign securities laws.17. Conflicting Terms; Incentive Plan Governs. This Agreement and the Notice of Grant are subject to all terms andprovisions of the Incentive Plan. In the event of a conflict between one or more provisions of this Agreement or the Notice of Grantand one or more provisions of the Incentive Plan, the provisions of the Incentive Plan will govern.A-318. Committee Authority; Decisions Conclusive and Binding. The Participant acknowledges that a copy of theIncentive Plan has been made available for his or her review by the Company, and represents that he or she is familiar with theterms and provisions thereof, and hereby accepts the Award subject to all the terms and provisions thereof. The Committee willhave the power to interpret this Agreement, the Notice of Grant and the Incentive Plan, and to adopt such rules for theadministration, interpretation and application of the Incentive Plan as are consistent therewith and to interpret or revoke any suchrules (including, but not limited to, the determination of whether or not any RSUs have vested). The Participant hereby agrees toaccept as binding, conclusive, and final all decisions of the Committee upon any questions arising under the Incentive Plan, thisAgreement or the Notice of Grant. No member of the Committee will be personally liable for any action, determination orinterpretation made in good faith with respect to the Incentive Plan, this Agreement or the Notice of Grant.19. Claims. The Participant’s sole remedy for any Claim shall be against the Company, and the Participant shall not haveany claim or right of any nature against any Related Company (including, without limitation, any parent, subsidiary or affiliate of theCompany) or any stockholder or existing or former director, officer or employee of the Company or any Related Company. Theforegoing individuals and entities (other than the Company) shall be third-party beneficiaries of this Agreement for purposes ofenforcing the terms of this Paragraph 19.20. Covenants and Agreements as Independent Agreements. Each of the covenants and agreements that is set forthin this Agreement shall be construed as a covenant and agreement independent of any other provision of this Agreement. Theexistence of any claim or cause of action of the Participant against the Company, whether predicated on this Agreement orotherwise, shall not constitute a defense to the enforcement by the Company of the covenants and agreements that are set forth inthis Agreement.21. Section 409A. The Award is intended to be exempt from or comply with the requirements of Section 409A, and shallbe construed accordingly. Notwithstanding any other provision of this Agreement, the Notice of Grant, the Incentive Plan or theEmployment Agreement to the contrary, with respect to any payments and benefits to which Section 409A applies, if theParticipant is a “specified employee,” within the meaning of Section 409A, then to the extent necessary to avoid subjecting theParticipant to the imposition of any additional tax under Section 409A, amounts that would otherwise be payable during the six-month period immediately following the Participant’s “separation from service,” within the meaning of Section 409A(a)(2)(A)(i), shallnot be paid to the Participant during such period, but shall instead be accumulated and paid to the Participant (or, in the event of theParticipant’s death, the Participant’s estate) in a lump sum on the first business day after the earlier of the date that is six monthsfollowing the Participant’s separation from service or the Participant’s death.22. Governing Law; Venue. The validity, interpretation, construction and performance of this Agreement shall begoverned by the internal substantive laws of the State of Delaware, without reference to any choice-of-law rules. The Participantirrevocably consents to theA-4nonexclusive jurisdiction and venue of the state and federal courts located in Dallas County, the State of Texas.23. Recovery of Compensation. In accordance with Section 6.13 of the Incentive Plan, the Company may recoup all orany portion of any Shares or cash paid to the Participant in connection with the Award, as set forth in the Company’s clawbackpolicy, if any, approved by the Board from time to time.24. Entire Agreement; Employment Agreement. This Agreement, together with the Notice of Grant and the IncentivePlan supersede any and all other prior understandings and agreements, either oral or in writing, between the parties with respect tothe subject matter hereof and constitute the sole and only agreements between the parties with respect to the said subject matter.All prior negotiations and agreements between the parties with respect to the subject matter hereof are merged into this Agreementand the Notice of Grant. Each party to this Agreement and the Notice of Grant acknowledges that no representations,inducements, promises, or agreements, orally or otherwise, have been made by any party or by anyone acting on behalf of anyparty, which are not embodied in this Agreement, the Notice of Grant or the Incentive Plan and that any agreement, statement, orpromise that is not contained in this Agreement, the Notice of Grant or the Incentive Plan shall not be valid or binding or of any forceor effect. Notwithstanding anything to the contrary contained in the Notice of Grant, this Agreement or in the Incentive Plan, in theevent of any conflict between the terms and conditions of the Award as set forth in the Notice of Grant, this Agreement and in theIncentive Plan, as the case may be, and the terms and conditions of the Employment Agreement, the terms and conditions of theEmployment Agreement shall govern unless the conflicting provision in the Notice of Grant, this Agreement or in the Incentive Plan,as the case may be, is more favorable to the Participant; in which case, the provision more favorable to the Participant shallgovern.25. Legal Construction. In the event that any one or more of the terms, provisions, or agreements that are contained inthis Agreement shall be held by a court of competent jurisdiction to be invalid, illegal, or unenforceable in any respect for anyreason, the invalid, illegal, or unenforceable term, provision, or agreement shall not affect any other term, provision, or agreementthat is contained in this Agreement, and this Agreement shall be construed in all respects as if the invalid, illegal, or unenforceableterm, provision, or agreement had never been contained herein.26. Headings. The headings that are used in this Agreement are used for reference and convenience purposes only anddo not constitute substantive matters to be considered in construing the terms and provisions of this Agreement.27. Gender and Number. Words of any gender used in this Agreement shall be held and construed to include any othergender, and words in the singular number shall be held to include the plural, and vice versa, unless the context requires otherwise.28. Modification. No change or modification of this Agreement or the Notice of Grant shall be valid or binding upon theparties unless the change or modification is in writing and signedA-5by the parties; provided, however, that the Company may change or modify this Agreement or the Notice of Grant without theParticipant’s consent or signature if the Company determines, in its sole discretion, that such change or modification is necessaryfor purposes of compliance with or exemption from the requirements of Section 409A of the Code or any regulations or otherguidance issued thereunder. Notwithstanding the preceding sentence, the Company may amend the Incentive Plan to the extentpermitted by the Incentive Plan.A-6Exhibit 10.15BLUCORA, INC. 2018 LONG-TERM INCENTIVE PLANRESTRICTED STOCK UNIT GRANT NOTICE(PERFORMANCE-BASED RESTRICTED STOCK UNITS)TO: (the “Participant” or “you”)FROM: Blucora, Inc., a Delaware corporation (the “Company”)You are hereby granted by the Company a Restricted Stock Unit Award (the “Award”) under the Blucora, Inc. 2018 Long-TermIncentive Plan (the “Incentive Plan”). Each restricted stock unit (an “RSU”) subject to the Award has a notional value equivalent toone share of the Company’s Common Stock for purposes of determining the number of shares of Common Stock (the “Shares”)subject to the Award.The Award is subject to all the terms and conditions set forth in this Restricted Stock Unit Grant Notice (the "Notice of Grant") andin the Restricted Stock Unit Agreement attached hereto as Exhibit A (the “Agreement”) and the Incentive Plan, each of which areincorporated by reference into this Notice of Grant. Capitalized terms that are not defined in the Notice of Grant shall have themeanings given to them in the Agreement, and if not defined in the Agreement, the meanings given to them in the Incentive Plan.Date of Grant: Award Number: Target Number of RSUsSubject to the Award: (the “Target RSUs”);provided that the actual number of RSUs that are granted and may be earned is up to 200% of the Target RSUs (or_____________________ RSUs)Vesting Schedule: Except as specifically provided in the Agreement and subject to the restrictions and conditions set forth in theIncentive Plan, the RSUs shall vest on the Vesting Date (as defined on Schedule 1 to this Notice of Grant, attached hereto, whichis incorporated by reference into this Notice of Grant), based upon the achievement of the performance goals set forth on Schedule1 (the “Performance Vesting Conditions”).Additional Terms/Acknowledgment: You acknowledge and agree that the Notice of Grant and the vesting schedule set forthherein do not constitute an express or implied promise of your continued engagement as an employee, officer, director or otherservice provider for the vesting period, for any period, or at all, and shall not interfere with your right or the Company’s right toterminate your employment or service relationship with the Company or its Related Companies at any time, with or without Cause.For purposes of this Award, the term “Cause” shall have the meaning set forth in your Employment Agreement (as defined below),provided that, if such Employment Agreement does not define such term or no such agreement is then in effect, then it shall meandishonesty, fraud, serious or willful misconduct, unauthorized use or disclosure of confidential information or trade secrets, orconduct prohibited by law (except minor violations), in each case as determined by the Committee, whose determination shall beconclusive and binding.Employment Agreement: If there is a written employment agreement in effect between you and the Company (the “EmploymentAgreement”), then the Award shall be subject to the terms of such Employment Agreement, so long as such EmploymentAgreement remains in effect (as it may be amended, supplemented or restated from time to time) and the terms set forth in theEmployment Agreement are applicable to the Award.Committee Decisions/Interpretations: You hereby agree to accept as binding, conclusive and final all decisions or interpretationsof the Committee upon any questions relating to the Incentive Plan and the Award.* * * * * * *[Remainder of Page Intentionally Left BlankSignature Page Follows.]-2-By your signature below or electronic acceptance, you agree that the Notice of Grant, the Agreement, the Incentive Plan,and the Employment Agreement (if applicable), constitute your entire agreement with respect to the Award, and except asset forth therein, may not be modified except by means of a writing signed by the Company and you. This Notice of Grantand Agreement may be executed and/or accepted electronically and/or executed in duplicate counterparts, the productionof either of which (including a signature or proof of electronic acceptance) shall be sufficient for all purposes for theproof of the binding terms of this Award.BLUCORA, INC.By:___________________________Its: ___________________________ PARTICIPANT_____________________________SignatureDate:_________________________ Attachments:1. Performance Vesting Conditions2. Restricted Stock Unit Agreement3. Incentive Plan Signature Page to Notice of GrantSCHEDULE 1BLUCORA, INC. 2018 LONG-TERM INCENTIVE PLANPERFORMANCE VESTING CONDITIONSSchedule 1-1EXHIBIT ABLUCORA, INC. 2018 LONG-TERM INCENTIVE PLANRESTRICTED STOCK UNIT AGREEMENT1.Grant. The Company hereby grants to the Participant listed on the Notice of Grant (the “Participant”) an Award ofRSUs, as set forth in the Notice of Grant and subject to the terms and conditions in this Restricted Stock Unit Agreement (this“Agreement”) and the Incentive Plan. Unless otherwise defined herein, the capitalized terms used herein shall have the meaningsgiven to them in the Notice of Grant, and if not defined in the Notice of Grant, the meanings given to them in the Incentive Plan.2. Company’s Obligation. Each RSU represents the right to receive a Share on the vesting date. Unless and until theRSUs vest, the Participant will have no right to receive Shares under such RSUs. Prior to actual distribution of Shares pursuant toany vested RSUs, such RSUs will represent an unsecured obligation of the Company.3. Vesting Schedule. Subject to Paragraph 4 hereof and to any other relevant Incentive Plan provisions, the RSUsawarded by this Agreement will vest according to the vesting schedule specified in the Notice of Grant. The effect of a Companyapproved unpaid leave of absence on the terms and conditions of the RSUs will be determined by the Committee, subject toapplicable laws.4. Forfeiture upon Termination of Service. Except as provided in the Notice of Grant, if the Participant has aTermination of Service for any or no reason prior to vesting, the unvested RSUs awarded by this Agreement will thereupon beforfeited at no cost to the Company.5. Payment After Vesting. Subject to Paragraph 21 hereof, any RSUs that vest in accordance with Paragraph 3 will bepaid to the Participant (or in the event of the Participant’s death, to his or her estate) in Shares on, or as soon as practicable after,the applicable vesting date (but in any event, within sixty (60) days of the date on which the RSUs vest).6. Withholding Taxes. As a condition to the payment of any vested RSUs, the Participant must make such arrangementsas the Company may require for the satisfaction of any federal, state or local withholding tax obligations that may arise inconnection with such payment. The Company may permit or require the Participant to satisfy all or part of the Participant’s taxwithholding obligations by (a) paying cash to the Company or a Related Company, as applicable; (b) having the Company or aRelated Company, as applicable, withhold an amount from any cash amounts otherwise due or to become due from the Companyor a Related Company, as applicable, to the Participant; (c) having the Company withhold a number of Shares that would otherwisebe issued to the Participant having a Fair Market Value equal to the tax withholding obligations; (d) surrendering a number ofShares the Participant already owns having a Fair Market Value equalA-1to the tax withholding obligations; or (e) any combination of (a), (b), (c) or (d) above. The value of the Shares so withheld ortendered may not exceed the employer’s minimum required tax withholding rate.7. Payments After Death. Any distribution or delivery to be made to the Participant under this Agreement will, if theParticipant is then deceased, be made to the administrator or executor of the Participant’s estate. Any such administrator orexecutor must furnish the Company with (a) written notice of his or her status as transferee and (b) evidence satisfactory to theCompany to establish the validity of the transfer and compliance with any laws or regulations pertaining to said transfer.8. Rights as Stockholder. Neither the Participant nor any person claiming under or through the Participant will have anyof the rights or privileges of a stockholder of the Company in respect of any Shares deliverable hereunder unless and until the dateof issuance of any such Shares under the Incentive Plan. Except as otherwise provided in Paragraph 9, no adjustment shall bemade for dividends or other rights for which the record date is prior to the issuance of any Shares subject to the Award. TheParticipant agrees to execute any documents requested by the Company in connection with the issuance of any Shares.9. Adjustments. The number of Shares covered by the Award shall be subject to adjustment in accordance with Article 11of the Incentive Plan.10. No Effect on Employment or Service Relationship. Nothing in the Incentive Plan or any Award granted under theIncentive Plan will be deemed to constitute an employment or service contract or confer or be deemed to confer any right for theParticipant to continue in the employ or service of, or to continue any other relationship with, the Company or any RelatedCompany or limit in any way the right of the Company or any Related Company to terminate the Participant’s employment or otherservice relationship at any time, with or without Cause.11. Notices. Any notice which either party hereto may be required or permitted to give to the other shall be in writing andmay be delivered personally, by interoffice mail, by fax, by electronic mail or other electronic means, or via a postal service,postage prepaid, to such electronic mail or postal address and directed to such person as the Company may notify the Participantfrom time to time; and to the Participant at the Participant’s electronic mail or postal address as shown on the records of theCompany from time to time, or at such other electronic mail or postal address as the Participant, by notice to the Company, maydesignate in writing from time to time.12. Award Is Not Transferable. Except to the limited extent provided in Paragraph 7, the Award and the rights andprivileges conferred hereby may not be transferred, assigned, pledged (as collateral for a loan or as security for the performance ofan obligation or for any other purpose) or hypothecated in any way (whether by operation of law or otherwise) and may not besubject to sale under execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate orotherwise dispose of the Award, or any right or privilege conferred hereby, or uponA-2any attempted sale under any execution, attachment or similar process, the Award and the rights and privileges conferred herebyimmediately will become null and void.13. Binding Agreement. Subject to the limitation on the transferability of the Award contained herein, this Agreement willbe binding upon and inure to the benefit of the parties hereto and their respective heirs, legatees, legal representatives, successorsand assigns.14. Regulatory Restrictions on Issuance of Shares. Notwithstanding the other provisions of this Agreement, if at anytime the Company determines, in its sole discretion, that the listing, registration or qualification of Shares upon any securitiesexchange or under any state or federal law, or the consent or approval of any governmental regulatory authority is necessary ordesirable as a condition to the issuance of Shares to the Participant (or his or her estate), such issuance will not occur unless anduntil such listing, registration, qualification, consent or approval will have been effected or obtained free of any conditions notacceptable to the Company. The Company shall be under no obligation to the Participant to register for offering or resale or toqualify for exemption under the Securities Act, or to register or qualify under the laws of any state or foreign jurisdiction, anyShares, security or interest in a security paid or issued under, or created by, the Incentive Plan, or to continue in effect any suchregistrations or qualifications if made.15. Participant’s Representations. Notwithstanding any of the provisions hereof, the Participant hereby agrees that theCompany will not be obligated to issue any Shares to the Participant if the issuance of such Shares shall constitute a violation bythe Participant or the Company of any provision of any law or regulation of any governmental authority. Any determination in thisconnection by the Committee shall be final, binding, and conclusive. The obligations of the Company and the rights of theParticipant are subject to all applicable laws, rules, and regulations.16. Investment Representation. Unless the Shares are issued to the Participant in a transaction registered underapplicable federal and state securities laws, the Participant represents and warrants to the Company that all Shares which may beissued hereunder will be acquired by the Participant for investment purposes for his or her own account and not with any intent forresale or distribution in violation of federal or state securities laws. Unless the Shares are issued to the Participant in a transactionregistered under the applicable federal and state securities laws, at the option of the Company, a stop-transfer order against theShares may be placed on the official stock books and records of the Company, and a legend indicating that such Shares may notbe pledged, sold or otherwise transferred, unless an opinion of counsel is provided (concurred in by counsel for the Company)stating that such transfer is not in violation of any applicable law or regulation, may be stamped on stock certificates to ensureexemption from registration. The Company may require such other action or agreement by the Participant as may from time totime be necessary to comply with the federal, state and foreign securities laws.17. Conflicting Terms; Incentive Plan Governs. This Agreement and the Notice of Grant are subject to all terms andprovisions of the Incentive Plan. In the event of a conflict between one or more provisions of this Agreement or the Notice of Grantand one or more provisions of the Incentive Plan, the provisions of the Incentive Plan will govern.A-318. Committee Authority; Decisions Conclusive and Binding. The Participant acknowledges that a copy of theIncentive Plan has been made available for his or her review by the Company, and represents that he or she is familiar with theterms and provisions thereof, and hereby accepts the Award subject to all the terms and provisions thereof. The Committee willhave the power to interpret this Agreement, the Notice of Grant and the Incentive Plan, and to adopt such rules for theadministration, interpretation and application of the Incentive Plan as are consistent therewith and to interpret or revoke any suchrules (including, but not limited to, the determination of whether or not any RSUs have vested). The Participant hereby agrees toaccept as binding, conclusive, and final all decisions of the Committee upon any questions arising under the Incentive Plan, thisAgreement or the Notice of Grant. No member of the Committee will be personally liable for any action, determination orinterpretation made in good faith with respect to the Incentive Plan, this Agreement or the Notice of Grant.19. Claims. The Participant’s sole remedy for any Claim shall be against the Company, and the Participant shall not haveany claim or right of any nature against any Related Company (including, without limitation, any parent, subsidiary or affiliate of theCompany) or any stockholder or existing or former director, officer or employee of the Company or any Related Company. Theforegoing individuals and entities (other than the Company) shall be third-party beneficiaries of this Agreement for purposes ofenforcing the terms of this Paragraph 19.20. Covenants and Agreements as Independent Agreements. Each of the covenants and agreements that is set forthin this Agreement shall be construed as a covenant and agreement independent of any other provision of this Agreement. Theexistence of any claim or cause of action of the Participant against the Company, whether predicated on this Agreement orotherwise, shall not constitute a defense to the enforcement by the Company of the covenants and agreements that are set forth inthis Agreement.21. Section 409A. The Award is intended to be exempt from or comply with the requirements of Section 409A, and shallbe construed accordingly. Notwithstanding any other provision of this Agreement, the Notice of Grant, the Incentive Plan or theEmployment Agreement to the contrary, with respect to any payments and benefits to which Section 409A applies, if theParticipant is a “specified employee,” within the meaning of Section 409A, then to the extent necessary to avoid subjecting theParticipant to the imposition of any additional tax under Section 409A, amounts that would otherwise be payable during the six-month period immediately following the Participant’s “separation from service,” within the meaning of Section 409A(a)(2)(A)(i), shallnot be paid to the Participant during such period, but shall instead be accumulated and paid to the Participant (or, in the event of theParticipant’s death, the Participant’s estate) in a lump sum on the first business day after the earlier of the date that is six monthsfollowing the Participant’s separation from service or the Participant’s death.22. Governing Law; Venue. The validity, interpretation, construction and performance of this Agreement shall begoverned by the internal substantive laws of the State of Delaware, without reference to any choice-of-law rules. The Participantirrevocably consents to theA-4nonexclusive jurisdiction and venue of the state and federal courts located in Dallas County, the State of Texas.23. Recovery of Compensation. In accordance with Section 6.13 of the Incentive Plan, the Company may recoup all orany portion of any Shares or cash paid to the Participant in connection with the Award, as set forth in the Company’s clawbackpolicy, if any, approved by the Board from time to time.24. Entire Agreement; Employment Agreement. This Agreement, together with the Notice of Grant and the IncentivePlan supersede any and all other prior understandings and agreements, either oral or in writing, between the parties with respect tothe subject matter hereof and constitute the sole and only agreements between the parties with respect to the said subject matter.All prior negotiations and agreements between the parties with respect to the subject matter hereof are merged into this Agreementand the Notice of Grant. Each party to this Agreement and the Notice of Grant acknowledges that no representations,inducements, promises, or agreements, orally or otherwise, have been made by any party or by anyone acting on behalf of anyparty, which are not embodied in this Agreement, the Notice of Grant or the Incentive Plan and that any agreement, statement, orpromise that is not contained in this Agreement, the Notice of Grant or the Incentive Plan shall not be valid or binding or of any forceor effect. Notwithstanding anything to the contrary contained in the Notice of Grant, this Agreement or in the Incentive Plan, in theevent of any conflict between the terms and conditions of the Award as set forth in the Notice of Grant, this Agreement and in theIncentive Plan, as the case may be, and the terms and conditions of the Employment Agreement, the terms and conditions of theEmployment Agreement shall govern unless the conflicting provision in the Notice of Grant, this Agreement or in the Incentive Plan,as the case may be, is more favorable to the Participant; in which case, the provision more favorable to the Participant shallgovern.25. Legal Construction. In the event that any one or more of the terms, provisions, or agreements that are contained inthis Agreement shall be held by a court of competent jurisdiction to be invalid, illegal, or unenforceable in any respect for anyreason, the invalid, illegal, or unenforceable term, provision, or agreement shall not affect any other term, provision, or agreementthat is contained in this Agreement, and this Agreement shall be construed in all respects as if the invalid, illegal, or unenforceableterm, provision, or agreement had never been contained herein.26. Headings. The headings that are used in this Agreement are used for reference and convenience purposes only anddo not constitute substantive matters to be considered in construing the terms and provisions of this Agreement.27. Gender and Number. Words of any gender used in this Agreement shall be held and construed to include any othergender, and words in the singular number shall be held to include the plural, and vice versa, unless the context requires otherwise.28. Modification. No change or modification of this Agreement or the Notice of Grant shall be valid or binding upon theparties unless the change or modification is in writing and signedA-5by the parties; provided, however, that the Company may change or modify this Agreement or the Notice of Grant without theParticipant’s consent or signature if the Company determines, in its sole discretion, that such change or modification is necessaryfor purposes of compliance with or exemption from the requirements of Section 409A of the Code or any regulations or otherguidance issued thereunder. Notwithstanding the preceding sentence, the Company may amend the Incentive Plan to the extentpermitted by the Incentive Plan.A-6Exhibit 10.33 EMPLOYMENT AGREEMENTThis Employment Agreement (this “Agreement”) is made and entered into effective as of December 24, 2018, by and betweenTodd C. Mackay (the “Executive”) and Blucora, Inc. (the “Company”).RECITALSWHEREAS, the Company currently employs Executive as the Company’s EVP of Business Development (the “Base Role”),and effective as of December 24, 2018 (the “Effective Date”), the Company desires to employ Executive as the Interim CEO of HDVest, and the Executive desires to serve in such capacity;NOW THEREFORE, in consideration of the foregoing, the mutual covenants contained herein, the employment of theExecutive by the Company, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,the parties hereto agree as follows:1. Certain Definitions(a) “Base Role” is Executive’s current role of EVP of Business Development.(b) “Base Salary” has the meaning set forth in Section 5(a).(c) “Board” means the Board of Directors of the Company.(d) “Cause” means, as determined by the Board in its reasonable discretion: (i) the Executive’s conviction of, or plea of guiltyor nolo contendere to, a misdemeanor involving dishonesty, wrongful taking of property, immoral conduct, bribery or extortion or anyfelony; (ii) willful material misconduct by the Executive in connection with the business of the Company; (iii) the Executive’scontinued and willful failure to perform substantially his responsibilities to the Company under this Agreement, after written demandfor substantial performance has been given by the Board that specifically identifies how the Executive has not substantially performedhis responsibilities; (iv) the Executive’s improper disclosure of confidential information or other material breach of this Agreement,including the Confidentiality and Non-Competition Agreement; (v) the Executive’s material fraud or dishonesty against the Company;(vi) the Executive’s willful and material breach of the Company’s written code of conduct and business ethics or other material writtenpolicy, procedure or guideline in effect from time to time (provided that the Executive was given access to a copy of such policy,procedure or guideline prior to the alleged breach) relating to personal conduct; or (vii) the Executive’s willful attempt to obstruct orwillful failure to cooperate with any investigation authorized by the Board or any governmental or self-regulatory entity. Anydetermination of Cause by the Company shall be made by a resolution approved by a majority of the members of the Board, providedthat, with respect to Section 1(c)(iii), the Board must give the Executive notice and 60 days to cure the substantial nonperformance.1(e) “Change of Control” means the occurrence of any of the following:(i) any “person” (as defined in Sections 13(d) and 14(d) of the Exchange Act), excluding for this purpose, (A) theCompany or any subsidiary of the Company or (B) any employee benefit plan of the Company or any subsidiary of the Company, orany person or entity organized, appointed or established by the Company for or pursuant to the terms of any such plan that acquiresbeneficial ownership of voting securities of the Company, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under theExchange Act), directly or indirectly, of securities of the Company representing more than 50% of the combined voting power of theCompany’s then outstanding securities;(ii) consummation of a reorganization, merger or consolidation of the Company, in each case, unless, following suchtransaction, all or substantially all the individuals and entities who were the beneficial owners of outstanding voting securities of theCompany immediately prior to such transaction beneficially own, directly or indirectly, more than 50% of the combined voting powerof the then outstanding voting securities entitled to vote generally in the election of directors of the company resulting from suchtransaction (including, without limitation, a company that, as a result of such transaction, owns the Company or all or substantially allthe Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownershipimmediately prior to such transaction of the outstanding voting securities of the Company;(iii) any sale or disposition by the Company, in one transaction or a series of related transactions, of all or substantiallyall the Company’s assets;(iv) a “Board Change” which, for purposes of this Agreement, shall have occurred if a majority of the seats on theBoard are occupied by individuals who were neither (A) nominated by a majority of the Incumbent Directors nor (B) appointed bydirectors so nominated (“Incumbent Director” means a member of the Board who has been either (1) nominated by a majority of thedirectors of the Company then in office or (2) appointed by directors so nominated, but excluding, for this purpose, any such individualwhose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by oron behalf of a person other than the Board); or(v) an approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.(f) “Code” means the Internal Revenue Code of 1986, as amended.(g) “Compensation Committee” means the Compensation Committee of the Board.(h) “Confidentiality and Non-Competition Agreement” means the Confidentiality and Non-Competition Agreement attachedhereto as Exhibit A.2(i) “Disability” means the Executive’s inability to perform his employment duties to the Company hereunder, with or withoutreasonable accommodation, for 180 days (in the aggregate) in any one-year period as determined by an independent physician selectedby the Company.(j) “Exchange Act” means the Securities Exchange Act of 1934, as amended.(k) “Good Reason” means the occurrence of any of the following without the Executive’s express prior written consent: (i) amaterial reduction of or to the Executive’s Base Role duties, authority, responsibilities (a change in reporting relationship alone doesnot constitute a material reduction); (ii) a material reduction of the Executive’s Base Role Salary; (iii) a material reduction of theExecutive’s Base Role Target Bonus; (iv) a material reduction in the kind or level of employee benefits to which the Executive isentitled that occur within two months prior to or within 12 months following the consummation of a Change of Control, unlesssimilarly situated employees also experience a reduction; (v) a requirement that the Executive relocate his primary residence more than50 miles from the greater Denver, Colorado area, or his primary work location more than 50 miles from the greater Dallas/Fort Worth,Texas area, or from any work location to which the Company transfers the Executive during the course of his employment and towhich such transfer the Executive has consented; (vi) in connection with a Change of Control, the failure of the Company to assignthis Agreement to a successor to the Company or the failure of a successor to the Company to explicitly assume and agree to be boundby this Agreement in a writing delivered to the Executive.Notwithstanding the foregoing, a Good Reason Termination shall not exist unless (x) the Executive delivers written notice to theCompany (the “Good Reason Termination Notice”) of the existence of the condition which the Executive believes constitutes a GoodReason Termination within 30 days of the initial existence of such condition (which Good Reason Termination Notice specificallyidentifies such condition), (y) the Company fails to remedy such condition within 30 days after the date on which it receives suchnotice (the “Good Reason Termination Cure Period”), and (z) the Executive actually terminates employment within 30 days after theexpiration of the Good Reason Termination Cure Period.(l) “Interim Role” means Executive’s interim role as either Interim General Manager of TaxAct or Interim CEO of HDVest.(m) “Release” means a full release of claims against the Company substantially in the form attached hereto as Exhibit B;provided, however, that notwithstanding the foregoing, such Release is not intended to and will not waive the Executive’s rights: (i) toindemnification pursuant to any applicable provision of the Company’s Bylaws or Certificate of Incorporation, as amended, pursuantto any written indemnification agreement between the Executive and the Company, or pursuant to applicable law; (ii) to vested benefitsor payments specifically to be provided to the Executive under this Agreement or any Company employee benefit plans or policies; or(iii) respecting any claims the Executive may have solely by virtue of the Executive’s status as a stockholder of the Company. TheRelease also shall not include claims that an employee cannot lawfully release through execution of a general release of claims.(n) “Section 409A” means Section 409A of the Code and the Treasury Regulations and official guidance issued in respect ofSection 409A of the Code.3(o) “Target Bonus” has the meaning set forth in Section 5(b).2. Duties and Scope of EmploymentThe Company shall employ the Executive in the Base Role through at least December 31, 2019 and in the Interim Role for solong as Executive’s service is required by the Company is such role. In his Interim Role, Executive shall report directly to theCompany’s President and Chief Executive Officer, and the Company reserves the right to alter such reporting after completion of theInterim Role and Executive’s return to the Base Role. The Executive will render such business and professional services in theperformance of the Executive’s duties, consistent with the Executive’s position(s) within the Company, as shall be reasonably assignedto the Executive at any time and from time to time. Upon termination of the Executive’s employment for any reason, unless otherwiserequested by the Company, the Executive will be deemed to have resigned from all positions held at the Company and its affiliatesvoluntarily, without any further action by the Executive, as of the end of the Executive’s employment, and the Executive, will executeany documents necessary to reflect his resignation.3. ObligationsWhile employed hereunder, the Executive will perform his duties ethically, faithfully and to the best of the Executive’s abilityand in accordance with law and Company policy. The Executive agrees not to actively engage in any other employment, occupation orconsulting activity for any direct or indirect remuneration without the express prior written approval of the Company’s President andChief Executive Officer; provided, however, that notwithstanding anything to the contrary in the Confidentiality and Non-CompetitionAgreement, the Executive may engage in charitable activities so long as such activities do not materially interfere with the Executive’sresponsibilities to the Company. Executive must receive prior written consent from the President and Chief Executive Officer prior toaccepting any role on a board of directors or board of trustees of any public, private or non-profit organization.4. Agreement TermUnless earlier terminated as provided herein, the term of this Agreement (the “Agreement Term”) shall be for a periodcommencing on the Effective Date and ending on December 31, 2019, and may be extended thereafter upon the written mutualagreement of the Executive and the Company.5. Compensation and Benefits(a) Base Salary. The Company agrees to pay the Executive a base salary (the “Base Role Salary”) at an annual rate of notless than $319,300 plus a monthly stipend of $5,900 during the tenure of the Interim Role, payable in accordance with the regularpayroll practices of the Company, but not less frequently than monthly. The Executive’s Base Salary shall be subject to annual reviewby the Board (or a committee thereof).4(b) Relocation Expenses. Executive shall be entitled to reimbursement for reasonable relocation expenses actually incurred,including purchase and sale transaction expenses, temporary housing costs and related incidental expenses, in an aggregate amount upto $250,000, grossed up so that such expenses are tax-neutral to Executive (“Relocation Expenses”); provided, however, that suchreimbursement of Relocation Expenses shall be subject to the following: (i) if Executive relocates his family to the Dallas/Fort Wortharea within 12 months from the Effective Date, Executive will be eligible for reimbursement of Relocation Expenses for a 18-monthperiod following the Effective Date. . If Executive resigns his employment with the Company for any reason, or if Executive isterminated by the Company for cause, and such resignation or termination occurs on or before the two-year anniversary of theEffective Date, Executive will repay the Company all amounts paid to Executive as Relocation Expenses.(c) Annual Bonus. The Executive shall be eligible to participate in the Company’s bonus and other incentive compensationplans and programs for the Company’s senior executives at a level commensurate with his position. The Executive shall have theopportunity to earn an annual target bonus (the “Target Bonus”) measured against criteria to be determined by the Board (or acommittee thereof) of at least 55% of Base Salary for his Base Role, with an additional stipend incentive of 70% for his Interim Roleon a pro rata basis (cumulating to 125% of his total Base and Stipend salary on an annualized basis during his Interim Role).Executive’s Target Bonus amount for each of 2018 and 2019 will be pro-rated to reflect the number of days of Executive’s base roleand Interim role tenure in each of 2018 and 2019. The payout of any 2018 and 2019 bonus will occur following the end of theCompany’s Executive Bonus Plan (the “Plan”) year, which is December 31, 2018 and December 31, 2019, respectively; and will bepaid in accordance with the terms and conditions of the Plan. The Company reserves the right to change the Plan at any time at itsdiscretion.(d) Equity Awards. The Executive will be eligible to participate in the Company’s long-term equity incentive programsextended to senior executives of the Company generally at levels commensurate with the Executive’s Base Role, which participationand levels shall be determined by the Board (or a committee thereof) in its sole discretion. Notwithstanding the foregoing, on theeffective date of his transition to Interim CEO of HD Vest, Executive will receive a stipend award in recognition of his service asInterim General Manager of TaxAct in the amount of $440,000 worth of shares, subject to a two-year cliff vest. Further, uponsuccessful completion of his service as Interim CEO of HD Vest, Executive will receive a stipend award of equity, similar to thatwhich is typically awarded to the CEO of HD Vest, in recognition of his interim service. Such award shall be made on a pro-rate basisto reflect his actual number of months of interim service and shall contain a two-year cliff vest.(e) Benefits. The Executive and his eligible dependents shall be eligible to participate in the employee benefit plans that areavailable or that become available to other employees of the Company, with the adoption or maintenance of such plans to be in thediscretion of the Company, subject in each case to the generally applicable terms and conditions of the plan or program in question andto the determination of any committee administering such plan or program. Such benefits shall include participation in the groupmedical, life, disability, and retirement plans that are made generally available to employees of the Company, and any supplementalplans available5to senior executives of the Company from time to time. The Company reserves the right to change or terminate its employee benefitplans and programs at any time.(f) Expenses. The Company shall reimburse the Executive for reasonable business expenses incurred by the Executive in thefurtherance of or in connection with the performance of the Executive’s duties hereunder, in accordance with the Company’s expensereimbursement policy as in effect from time to time.6. Termination of Employment(a) General Provisions. This Agreement and the Executive’s employment with the Company may be terminated by either theExecutive or the Company at will at any time with or without Cause; provided, however, that the parties’ rights and obligations uponsuch termination during the Agreement Term shall be as set forth in applicable provisions of this Agreement.(b) Termination by Company Without Cause or Good Reason Termination Prior to December 31, 2019. In the event of anytermination of the Executive’s employment with by Company prior to December 31, 2019, (i) the Company shall pay the Executive aseverance payment in an amount equal to two times the Executive’s Base Role Base Salary in effect as of the date of such termination(the “Termination Date”); (ii) the Company shall pay the Executive any unpaid pro rata bonus at the Target rate of his Base Rolecompensation as described in Section 5(c), to the extent earned through the Termination Date; and (iii) a lump-sum payment in anamount equal to the monthly COBRA premium in effect under Blucora’s group health plan as of your termination date for thecoverage in effect under such plan for you (and your spouse and dependent children) on such date, multiplied by 12, which amountshall be payable in a single lump sum on the first payroll date that is at least 60 days following your termination date (but in any event,no later than March 15 of the calendar year immediately following the calendar year that includes your termination date); and (iv)following submission of proper expense reports by the Executive, the Company shall reimburse the Executive for all expensesreasonably and necessarily incurred by the Executive in connection with the business of the Company through the Termination Date(collectively, the “Accrued Obligations”). The Accrued Obligations shall be paid promptly upon termination and within the period oftime mandated by applicable law (but, in any event, within 30 days after the Termination Date). The Accrued Obligations paid orprovided pursuant to this Section 6(b) shall be in addition to the payments and benefits, if any, to be provided to the Executive upon histermination of employment pursuant to Section 6(c), 6(d), 6(e), or 6(f) as applicable. Except as expressly stated above or as required bylaw or this Agreement, the Executive shall receive no further compensation in any form other than as set forth in this Section 6(b).(c) Termination by Company Without Cause or Good Reason Termination after December 31, 2019. If, other than inconnection with a Change of Control as described in Section 6(d), the Executive’s employment with the Company is terminated by theCompany without Cause or the Executive terminates employment with the Company under circumstances constituting a Good ReasonTermination after December 31, 2019, then subject to Section 6(g), the Executive shall receive the following payments and benefits:6(i) a severance payment in an amount equal to one times the Executive’s Base Salary in effect as of the TerminationDate (or if the Executive terminates employment under circumstances constituting a Good Reason Termination due to a materialreduction of the Executive’s Base Salary, in effect immediately prior to such reduction) (less applicable withholding taxes), whichamount shall be payable in a single lump sum on the first payroll date that is at least 60 days following the Termination Date (but, inany event, by no later than March 15 of the calendar year immediately following the calendar year that includes the Termination Date),in accordance with Section 14(b)(ii); and(ii) a lump-sum payment in an amount equal to twelve months of the COBRA premium in effect under theCompany’s group health plan as of the Termination Date for the coverage in effect under such plan for the Executive (and theExecutive’s spouse and dependent children) which amount shall be payable in a single lump sum on the first payroll date that is at least60 days following the Termination Date (but, in any event, by no later than March 15 of the calendar year immediately following thecalendar year that includes the Termination Date), in accordance with Section 14(b)(ii); provided, however, that notwithstanding theforegoing or any other provision in this Agreement to the contrary, the Company (or its successor) may unilaterally amend this Section6(c)(ii) or eliminate the benefit provided hereunder to the extent it deems necessary to avoid the imposition of excise taxes, penalties orsimilar charges on the Company or any of its subsidiaries, affiliates or successors, including, without limitation, under Section 4980Dof the Code.Notwithstanding any provision to the contrary in any Company equity compensation plan or any outstanding equity awardagreement, if, during the Agreement Term, the Executive terminates employment with the Company under circumstances described inSections 6(b) or 6(c), there shall be no acceleration of vesting or exercisability of any outstanding equity awards or extension of anyoption post- termination exercise period.For the avoidance of doubt, under no circumstances will the Executive be entitled to payments and benefits under both thisSection 6(c) and Section 6(d).(d) Termination of Employment in Connection With a Change of Control. If the Company terminates the Executive’semployment without Cause or the Executive terminates employment with the Company for Good Reason (1) on the day of or duringthe 12-month period immediately following the consummation of a Change of Control or (2) during the 2-month period prior to theconsummation of a Change of Control but at the request of any third party participating in or causing the Change of Control orotherwise in connection with the Change of Control, then subject to Section 6(g) and with respect to clause (2), subject to theconsummation of such Change of Control, the Executive shall receive the following payments and benefits:(i) a severance payment in an amount equal to one times the Executive’s Base Salary then in effect as of theTermination Date and his then current Target Bonus amount (or if the Executive terminates employment for Good Reason due to amaterial reduction of the Executive’s Base Salary or Target Bonus, in effect immediately prior to such reduction) (in each case lessapplicable withholding taxes), which amount shall be payable in a single lump sum on the first payroll date that is at least 60 daysfollowing the Termination Date (but, in any event, by no later than March 15 of the calendar year immediately following the calendaryear that includes the7Termination Date), in accordance with Section 14(b)(ii). For the avoidance of doubt, if Executive is performing in the Interim Role atthe time of such Change of Control, he will also receive the Interim Stipends for both base salary and bonus in conjunction with thisparagraph);(ii) a lump-sum payment in an amount equal to (A) the monthly COBRA premium in effect under the Company’sgroup health plan as of the Termination Date for the coverage in effect under such plan for the Executive (and the Executive’s spouseand dependent children) on such date multiplied by (B) 12 (less applicable withholding taxes), which amount shall be payable in asingle lump sum on the first payroll date that is at least 60 days following the Termination Date (but, in any event, by no later thanMarch 15 of the calendar year immediately following the calendar year that includes the Termination Date), in accordance with Section14(b)(ii); provided, however, that notwithstanding the foregoing or any other provision in this Agreement to the contrary, the Company(or its successor) may unilaterally amend this Section 6(d)(ii) or eliminate the benefit provided hereunder to the extent it deemsnecessary to avoid the imposition of excise taxes, penalties or similar charges on the Company or any of its subsidiaries, affiliates orsuccessors, including, without limitation, under Section 4980D of the Code; and(iii) notwithstanding any provision to the contrary in any applicable equity compensation plan or any outstandingequity award agreement, the treatment of the Executive’s outstanding equity awards shall be governed solely by the followingprovisions: (A) all of the Executive’s then-outstanding time-vesting equity awards shall fully vest and all restrictions thereon shalllapse, and (B) to the extent vested (including as a result of the acceleration provided under this Section 6(d)(iii)), all of the Executive’soutstanding stock options shall remain exercisable until the first to occur of 12 months following the Termination Date and each suchstock option’s original expiration date.If a Change of Control is consummated prior to the expiration of the Agreement Term, this Section 6(d) shall apply to atermination of the Executive’s employment by the Company without Cause or by the Executive for Good Reason during the 12-monthperiod immediately following the consummation of the Change of Control even if such 12-month period extends past the expiration ofthe Agreement Term. Moreover, notwithstanding the expiration of the Agreement Term, if a Change of Control is consummatedwithin two months after the expiration of the Agreement Term, then this Section 6(d) shall apply to a termination of the Executive’semployment by the Company without Cause or by the Executive for Good Reason (i) on the day of or during the 12-month periodimmediately following the consummation of the Change of Control or (ii) during the 2-month period prior to the consummation of theChange of Control but at the request of any third party participating in or causing the Change of Control or otherwise in connectionwith the Change of Control.For the avoidance of doubt, the payments and benefits described under this Section 6(d) and the Accrued Obligations shall bethe only payments and benefits to which the Executive is entitled in the event that the Executive’s employment terminates under thisSection 6(d).(e) Death. In the event of the Executive’s death while employed hereunder, and subject to Section 6(g), the Executive’sbeneficiary (or such other person(s) specified by will or the laws of descent and distribution) shall be entitled to receive a lump-sumpayment in an amount equal to three months’ Base Salary in effect as of the Termination Date (less applicable withholding taxes),8which amount shall be payable in a single lump sum on the first payroll date that is at least 60 days following the Termination Date(but, in any event, by no later than March 15 of the calendar year immediately following the calendar year that includes theTermination Date), in accordance with Section 14(b)(ii).(f) Disability. In the event of the Executive’s termination of employment with the Company due to Disability, and subject toSection 6(g), the Executive shall be entitled to receive a lump- sum payment in an amount equal to six months’ Base Salary in effect asof the Termination Date (less applicable withholding taxes), which amount shall be payable in a single lump sum on the first payrolldate that is at least 60 days following the Termination Date (but, in any event, by no later than March 15 of the calendar yearimmediately following the calendar year that includes the Termination Date), in accordance with Section 14(b)(ii).(g) Release and Other Conditions. The payments and benefits described in Sections 6(c) through 6(f) are expresslyconditioned on (i) the Executive (or, in the case of the Executive’s death, the Executive’s representative) signing and delivering (andnot revoking thereafter) a Release to the Company (which, in the case of the Executive’s death, also releases any claims by theExecutive’s estate or survivors), which Release is executed, delivered and effective no later than 60 days following the TerminationDate and (ii) the Executive continuing to satisfy any obligations to the Company under this Agreement, the Release and theConfidentiality and Non-Competition Agreement that are incorporated herein by reference, and any other agreement(s) between theExecutive and the Company. In the event the Release described in Section 6(g)(i) is not executed, delivered and effective by the 60thday after the Termination Date, none of such payments or benefits shall be provided to the Executive.7. Section 280G(a) Amount of Payments and Benefits. Notwithstanding anything to the contrary herein, in the event that the Executivebecomes entitled to receive or receives any payments, options, awards or benefits (including, without limitation, the monetary value ofany noncash benefits and the accelerated vesting of equity-based awards) under this Agreement or under any other plan, agreement orarrangement with the Company or any person affiliated with the Company (collectively, the “Payments”), that may separately or in theaggregate constitute “parachute payments” within the meaning of Section 280G of the Code and the Treasury Regulationspromulgated thereunder (or any similar or successor provision) (collectively, “Section 280G”) and it is determined that, but for thisSection 7(a), any of the Payments will be subject to any excise tax pursuant to Section 4999 of the Code or any similar or successorprovision (the “Excise Tax”), the Company shall pay to the Executive either (i) the full amount of the Payments or (ii) an amount equalto the Payments, reduced by the minimum amount necessary to prevent any portion of the Payments from being an “excess parachutepayment” (within the meaning of Section 280G) (the “Capped Payments”), whichever of the foregoing amounts results in the receiptby the Executive, on an after-tax basis, of the greatest amount of Payments notwithstanding that all or some portion of the Paymentsmay be subject to the Excise Tax. For purposes of determining whether the Executive would receive a greater after-tax benefit from theCapped Payments than from receipt of the full amount of the Payments, (i) there shall be taken into account any Excise Tax and allapplicable federal, state and local taxes9required to be paid by the Executive in respect of the receipt of such payments and (ii) such payments shall be deemed to be subject tofederal income taxes at the highest rate of federal income taxation applicable to individuals that is in effect for the calendar year inwhich the payments and benefits are to be paid, and state and local income taxes at the highest rate of taxation applicable to individualsin the state and locality of the Executive’s residence on the effective date of the relevant transaction described under Section 280G(b)(2)(A)(i) of the Code, net of the maximum reduction in federal income taxes that could be obtained from deduction of such state andlocal taxes (as determined by assuming that such deduction is subject to the maximum limitation applicable to itemized deductionsunder Section 68 of the Code and any other limitations applicable to the deduction of state and local income taxes under the Code).(b) Computations and Determinations. All computations and determinations called for by this Section 7 shall be made by anindependent accounting firm or independent tax counsel appointed by the Company (the “Tax Counsel”), and all such computationsand determinations shall be conclusive and binding on the Company and the Executive. For purposes of such calculations anddeterminations, the Tax Counsel may rely on reasonable, good faith interpretations concerning the application of Sections 280G and4999 of the Code. The Tax Counsel shall submit its determination and detailed supporting calculations to both the Executive and theCompany within 15 days after receipt of a notice from either the Company or the Executive that the Executive may receive paymentswhich may be considered “parachute payments.” The Company and the Executive shall furnish to the Tax Counsel such informationand documents as the Tax Counsel may reasonably request in order to make the computations and determinations called for by thisSection 7. The Company shall bear all costs that the Tax Counsel may reasonably incur in connection with the computations anddeterminations called for by this Section 7.(c) Reduction Methodology. In the event that Section 7(a) applies and a reduction is required to be applied to the Paymentsthereunder, the Payments shall be reduced by the Company in its reasonable discretion in the following order: (i) reduction of anyPayments that are subject to Section 409A on a pro-rata basis or such other manner that complies with Section 409A, as determined bythe Company, and (ii) reduction of any Payments that are exempt from Section 409A.8. No Impediment to AgreementThe Executive hereby represents to the Company that the Executive is not, as of the date hereof, and will not be, during theExecutive’s employment with the Company, employed under contract, oral or written, by any other person, firm or entity, and is notand will not be bound by the provisions of any restrictive covenant or confidentiality agreement that would constitute an impedimentto, or restriction upon, the Executive’s ability to enter this Agreement and to perform the duties of the Executive’s employment.9. Confidentiality and Non-Competition AgreementThe Confidentiality and Non-Competition Agreement is incorporated by reference as if set forth fully herein. TheConfidentiality and Non-Competition Agreement shall survive the termination of this Agreement and/or the Executive’s employmentwith the Company.1010. CooperationExecutive hereby agrees to provide Executive’s full cooperation, at the request of the Company, with any of the ReleasedParties in any and all such lawsuits, investigations or other legal, equitable or business matters or proceedings which involve anymatters for which Executive worked on or had responsibility during Executive’s employment with the Company. Executive alsoagrees to be available to the Company and its representatives (including attorneys) to provide general advice or assistance as requestedby the Company. This includes but is not limited to testifying (and preparing to testify) as a witness in any proceeding or otherwiseproviding information or reasonable assistance to the Company in connection with any investigation, claim or suit, and cooperatingwith the Company regarding any investigation, litigation, claims or other disputed items involving the Company that relate to matterswithin the knowledge or responsibility of Executive. Specifically, Executive agrees (i) to meet with the Company’s representatives, itscounsel or other designees at reasonable times and places with respect to any items within the scope of this provision; (ii) to providetruthful testimony regarding same to any court, agency or other adjudicatory body; (iii) to provide the Company with immediate noticeof contact or subpoena by any non-governmental adverse party (known to Executive to be adverse to the Company or its interests);and (iv) to not voluntarily assist any such non-governmental adverse party or such non-governmental adverse party’s representatives.Executive acknowledges and understands that Executive’s obligations of cooperation under this Section are not limited in time andmay include, but shall not be limited to, the need for or availability for testimony. Executive shall receive no additional compensationfor time spent assisting the Company pursuant to this Section other than the compensation and benefits provided for in this Agreement,provided that Executive shall be entitled to be reimbursed for any reasonable out-of-pocket expenses incurred in fulfilling Executive’sobligations pursuant to subsections (i) and (ii) above. Notwithstanding the foregoing, nothing in this Section is intended to interferewith Executive’s No Interference rights set forth in Section 1(c) of the Confidentiality and Non-Competition Agreement.11. Arbitration(a) Executive agrees that any dispute and/or claim between the Company (including without limitation its officers, directors,employees agents or shareholders and its subsidiaries) and Executive that underlies, relates to and/or results from Executive’semployment relationship with the Company or the termination of that relationship or any of the terms of this Agreement, except for anydispute or claim arising from or relating to the Confidentiality and Non-Competition Agreement, that cannot be resolved by mutualagreement of the Company and Executive will be submitted to final, binding arbitration to the maximum extent permitted by law inaccordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association that are thenin effect. This arbitration provision includes, but is not limited to, claims of wrongful discharge, infliction of emotional distress, breachof contract (including breach of this Agreement), breach of any covenant of good faith and fair dealing, and claims of retaliation and/ordiscrimination in violation of any local, state or federal law. Examples of such laws include Title VII of the Civil Rights Act of 1964;the Age Discrimination in Employment Act of 1967; the Americans with Disabilities Act of 1990; and the Family and Medical LeaveAct of 1993, and all amendments to each such law as well as the regulations issued thereunder. This arbitration provision11does not affect the Executive’s right to pursue worker’s compensation or unemployment compensation benefits for which he may beeligible in accordance with state law, nor does it affect the Executive’s right to file and/or to cooperate in the investigation of anadministrative charge of discrimination.(b) Notwithstanding this arbitration provision, either the Executive or the Company may apply to any court of competentjurisdiction for a temporary restraining order, preliminary injunction, or other interim or conservatory relief, as necessary, withoutbreach of this Agreement and without abridgement of the powers of the arbitrator.(c) This arbitration provision does not apply to any dispute or claim arising from or relating to the Confidentiality and Non-Competition Agreement.(d) The Company, as further consideration for Executive’s agreement to arbitrate covered disputes, agrees to pay for thearbitrator’s fees and other costs directly associated with the arbitration that would not otherwise be charged if the parties pursued civillitigation in court.12. Successors; Personal ServicesThe services and duties to be performed by the Executive hereunder are personal and may not be assigned or delegated. ThisAgreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and the Executive and theExecutive’s heirs and representatives.13. NoticesNotices and all other communications contemplated by this Agreement shall be in writing and shall be deemed to have beenduly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid.In the case of the Executive, mailed notices shall be addressed to the Executive at the home address the Executive most recentlycommunicated to the Company in writing. In the case of the Company, mailed notices shall be addressed to its corporate headquarters,and all notices shall be directed to the attention of its President and Chief Executive Officer.14. Section 409A(a) The parties intend that this Agreement and the payments and benefits provided hereunder be exempt from therequirements of Section 409A, to the maximum extent possible, whether pursuant to the short-term deferral exception described inTreasury Regulation Section 1.409A-1(b)(4), the involuntary separation pay plan exception described in Treasury Regulation Section1.409A-1(b)(9)(iii), or otherwise. To the extent Section 409A is applicable to this Agreement, the parties intend that this Agreementand any payments and benefits thereunder comply with the deferral, payout and other limitations and restrictions imposed underSection 409A. Notwithstanding anything herein to the contrary, this Agreement shall be interpreted, operated and administered in amanner consistent with such intentions.12(b) Without limiting the generality of the foregoing, and notwithstanding any other provision of this Agreement to thecontrary:(i) if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that termunder Section 409A, then with regard to any payment that is considered a “deferral of compensation” under Section 409A payable onaccount of a “separation from service,” such payment shall be made on the date which is the earlier of (A) the date that is six monthsand one day after the date of such “separation from service” of the Executive and (B) the date of the Executive’s death (the “DelayPeriod”), to the extent required under Section 409A. Within ten business days following the expiration of the Delay Period, allpayments delayed pursuant to this Section 14(b)(i) (whether they would have otherwise been payable in a single sum or in installmentsin the absence of such delay) shall be paid to the Executive in a lump sum, and all remaining payments due under this Agreement shallbe paid or provided in accordance with the normal payment dates specified for those payments in this Agreement;(ii) to the extent that any payments or benefits under this Agreement are conditioned on a Release, if the Release isexecuted and delivered by the Executive to the Company and becomes irrevocable and effective within the specified 60-day post-termination period, then, subject to Section 14(b)(i) and to the extent not exempt under Section 409A, such payments or benefits shallbe made or commence on the first payroll date after the date that is 60 days after the Termination Date (but, in any event, by no laterthan March 15 of the calendar year immediately following the calendar year that includes the Termination Date). If a payment orbenefit under this Agreement is conditioned on a Release and such Release is not executed, delivered and effective by the 60th dayafter the Termination Date, such payment or benefit shall not be paid or provided to the Executive;(iii) all expenses or other reimbursements under this Agreement shall be made on or prior to the last day of the taxableyear following the taxable year in which such expenses were incurred by the Executive. No such reimbursement or expenses eligiblefor reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year, and theExecutive’s right to reimbursement shall not be subject to liquidation or exchange for any other benefit;(iv) for purposes of Section 409A, the Executive’s right to receive a series of installment payments pursuant to thisAgreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreementspecifies a payment period with reference to a number of days (e.g., “payment shall be made within 30 days”), the actual date ofpayment within the specified period shall be within the sole discretion of the Company;(v) in no event shall any payment under this Agreement that constitutes a “deferral of compensation” for purposes ofSection 409A be offset by any other payment pursuant to this Agreement or otherwise; and(vi) to the extent required for purposes of compliance with Section 409A, termination of employment shall not bedeemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits uponor following a termination13of employment unless such termination is also a “separation from service” within the meaning of Section 409A, and for purposes ofany such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separationfrom service.”(c) The Company and the Executive agree to work together in good faith to consider amendments to this Agreement and totake such reasonable actions that may be necessary, appropriate, or desirable to avoid imposition of additional tax or incomerecognition on the Executive under Section 409A, in each case to the maximum extent permitted by applicable law. Notwithstandingany provision of this Agreement to the contrary, (i) in no event will the Company be liable for any additional tax, interest or penaltythat may be imposed on the Executive by Section 409A or damages for failing to comply with Section 409A and (ii) the Executiveacknowledges and agrees that the Executive will not have any claim or right of action against the Company or any of its employees,officers, directors or agents in the event it is determined that any payment or benefit provided hereunder does not comply with Section409A.15. Miscellaneous Provisions(a) Waiver. No provision of this Agreement shall be modified, waived or discharged unless the modification, waiver ordischarge is agreed to in writing and signed by the Executive and by an authorized officer of the Company (other than the Executive).No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other partyshall be considered a waiver of any other condition or provision or of the same condition or provision at another time.(b) Entire Agreement. This Agreement (including exhibits) shall supersede and replace all prior agreements or understandingsrelating to the subject matter hereof, and no agreements, representations or understandings (whether oral or written or whether expressor implied) that are not expressly set forth in this Agreement have been made or entered into by either party with respect to the relevantmatters hereof. This Agreement may not be modified except expressly in a writing signed by both parties.(c) Disclaimer of Reliance. Except for the specific representations expressly made by the Company in this Agreement,Executive specifically disclaims that Executive is relying upon or has relied upon any communications, promises, statements,inducements, or representation(s) that may have been made, oral or written, regarding the subject matter of this Agreement. Executiverepresents that Executive relied solely and only on Executive’s own judgment in making the decision to enter into this Agreement.(d) Choice of Law. The validity, interpretation, construction and performance of this Agreement shall be governed by theinternal substantive laws of the State of Texas without reference to any choice of law rules.(e) Severability. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect thevalidity or enforceability of any other provision hereof, which shall remain in full force and effect.14(f) No Assignment of Benefits. The rights of any person to payments or benefits under this Agreement shall not be madesubject to option or assignment, either by voluntary or involuntary assignment or by operation of law, in respect of bankruptcy,garnishment, attachment or other creditor’s process, and any action in violation of this Section 15(f) shall be void.(g) No Duty to Mitigate. The Executive shall not be required to mitigate the amount of any payment contemplated by thisAgreement, nor shall any such payment be reduced by any earnings that the Executive may receive from any other source.(h) Employment Taxes. All payments made pursuant to this Agreement will be subject to withholding of all applicableincome, employment and other taxes.(i) Assignment by Company. The Company may assign its rights under this Agreement to an affiliate (as defined under theExchange Act), and an affiliate may assign its rights under this Agreement to another affiliate of the Company or to the Company. Inthe case of any such assignment, the term “Company” when used in a section of this Agreement shall mean the corporation thatactually employs the Executive.(j) Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all ofwhich together will constitute one and the same instrument.[Signature Page Follows]15IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorizedofficer, as of the day and year first above written.BLUCORA, INC. By: /s/ Ann J. Bruder Name: Ann J. BruderTitle: Chief Legal Officer EXECUTIVE: /s/ Todd Mackay Todd C. Mackay16EXHIBIT ACONFIDENTIALITY AND NON-COMPETITION AGREEMENTThis Confidentiality and Non-Competition (“Agreement”) is entered into by and between Blucora, Inc, its subsidiaries,affiliates, successors and/or assigns (the “Company”) and Todd C. Mackay (“Executive”). The Effective Date of this Agreement is thedate of Executive’s execution of this Agreement. The Company and Executive shall be referred to herein individually as a “Party” andcollectively as the “Parties.”NOW, THEREFORE, in consideration of the mutual covenants set forth herein, Executive’s position with the Company, theConfidential Information (defined below), compensation and benefits provided to Executive, and other good and valuableconsideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the Partiesagree as follows:(a) Confidential Information and Executive’s Non-Disclosure Agreement.(a) Confidential Information. During Executive’s employment with the Company, the Company shall provide ExecutiveConfidential Information (defined below), which is not known to the Company’s competitors or within the Company’s industrygenerally, which was developed by the Company over a long period of time and/or at its substantial expense, and which is of greatcompetitive value to the Company. For purposes of this Agreement, “Confidential Information” includes all documents orinformation, in whatever form or medium, concerning or relating to any of the following: all trade secrets and confidential andproprietary information of or relating to the Company, including, but not limited to: (A) financial models, business records, businessplans or processes, strategies (including, without limitation, economic and market research selection and analysis strategies andbusiness development and market segment exploitation strategies), tactics, policies, resolutions, processes, inventions, patents,trademarks, trade secrets, know how, patent or trademark applications and other intellectual property, (B) information regardinglitigation or negotiations, (C) any marketing information, sales or product plans, prospects and market research data relating to thebusiness, (D) financial information, cost and performance data and any debt arrangements, equity ownership or securities transactioninformation, (E) technical information, technical drawings and designs, (F) personnel information, personnel lists, resumes, personneldata, organizational structure, compensation and performance evaluations, (G) customer, consumer, consultants or supplierinformation, including but not limited to any data regarding any current, prospective or former customers, consumers, consultants orsuppliers of Company, (H) information regarding the existence or terms of any agreement or relationship between the Company or anyof its subsidiaries or affiliates and any other party, (I) information subject to Section 628 of the Fair Credit Reporting Act and anyregulations or guidelines thereunder and (J) any other information of whatever nature, including, without limitation, information whichgives to the Company or any of its subsidiaries or affiliates an opportunity to obtain an advantage over its competitors who or which donot have access to such information. Confidential Information, whether prepared or compiled by Executive and/or the Company orfurnished to Executive during Executive’s employment with the Company, shall be the sole and exclusive property of the Company,and none of such Confidential Information or copies thereof, shall be retained by Executive. Executive agrees not to dispute,CONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 1contest, or deny any such ownership rights either during or after Executive’s employment with the Company. Executive acknowledgesthat the Company does not voluntarily disclose Confidential Information, but rather takes precautions to prevent dissemination ofConfidential Information beyond those employees such as Executive entrusted with such information. Executive further acknowledgesthat the Confidential Information: (a) is entrusted to Executive because of Executive’s position with the Company; and (b) is of suchvalue and nature as to make it reasonable and necessary for Executive to protect and preserve the confidentiality and secrecy of theConfidential Information. Executive acknowledges and agrees that the Confidential Information is proprietary to and a trade secret ofthe Company and, as such, is a valuable, special and unique asset of the Company, the unauthorized use or disclosure of which willcause irreparable harm, substantial injury and loss of profits and goodwill to the Company. “Confidential Information” does notinclude any information which is generally available to and known by the public or becomes generally available to and known by thepublic (other than as a result of Executive’s breach of this Agreement or any other agreement or obligation to keep such informationconfidential).(b) Non-Disclosure.(i) Executive agrees to preserve and protect the confidentiality of all Confidential Information. Executive agrees thatduring the period of Executive’s employment with the Company and at any time thereafter (regardless of the reason for Executive’sseparation or termination of employment): (A) Executive shall hold all Confidential Information in the strictest confidence, take allreasonable precautions and steps to safeguard all Confidential Information and prevent its wrongful use by or wrongful or inadvertentdisclosure or dissemination to any unauthorized person or entity, and follow all policies and procedures of the Company protecting orregarding the Confidential Information; and (B) without prior written authorization of the Company, Executive shall not, directly orindirectly, use for Executive’s own account, use in any way or for any other purpose, disclose to anyone, publish, exploit, destroy,copy or remove from the offices of the Company, nor solicit, allow or assist another person or entity to use, disclose, publish, exploit,destroy, copy or remove from the offices of the Company, any Confidential Information or part thereof, except: (1) as permitted in theproper performance of Executive’s duties for the Company; (2) as permitted in the ordinary course of the Company’s business for thebenefit of the Company; or (3) as otherwise permitted or required by law. Executive shall immediately notify the Company ifExecutive learns of or suspects any actual or potential unauthorized use or disclosure of Confidential Information concerning theCompany. Further, the Executive shall not, directly or indirectly, use the Company’s Confidential Information to: (1) call upon, solicitbusiness from, attempt to conduct business with, conduct business with, interfere with or divert business away from any customer,client, service provider, supplier or vendor of the Company with whom or which the Company conducted business; and/or (2) recruit,solicit, hire or attempt to recruit, solicit, or hire, directly or by assisting others, any persons employed by the Company. In the eventExecutive is subpoenaed, served with any legal process or notice, or otherwise requested to produce or divulge, directly or indirectly,any Confidential Information by any entity, agency or person in any formal or informal proceeding including, but not limited to, anyinterview, deposition, administrative or judicial hearing and/or trial, except where prohibited by law, Executive should immediatelynotify the Company and deliver a copy of the subpoena, process, notice or other request to the Company as promptly as possible, butunder no circumstances more than ten (10) days following Executive’sCONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 2receipt of same; provided, however, Executive is not required to notify the Company or provide a copy of the subpoena, process,notice or other request where Executive is permitted to make such disclosure of Confidential Information pursuant to this Agreement orapplicable law or regulation, as set forth in Section 1(c) and Section 1(d).(ii) Subject to Section 1(b)(iii), Executive agrees that Executive will not use or disclose any confidential, proprietaryor trade secret information belonging to any former employer or third party, and Executive will not bring onto the premises of theCompany or onto any Company property, any confidential, proprietary or trade secret information belonging to any former employeror third party without such third party’s written consent. Executive acknowledges that that the Company has specifically instructedExecutive not to disclose to the Company, use, or induce the Company to use, any confidential, proprietary or trade secret informationbelonging to any previous employer or others.(iii) During Executive’s employment, the Company will receive from third parties their confidential and/or proprietaryinformation, subject to a duty on the Company’s part to maintain the confidentiality of and to use such information only for certainlimited purposes. Executive agrees to hold all such confidential or proprietary information in the strictest confidence and not to discloseit to any person or organization or to use it except as necessary in the course of Executive’s employment with the Company and inaccordance with the Company’s agreement with such third party.(iv) Except in the proper performance of Executive’s duties and responsibilities, Executive agrees that Executive shallnot remove, destroy, deface, damage or delete any Property of the Company. For purposes of this Agreement, the term “Property”means all property or information, in whatever form or media, and all copies thereof whether or not the original was deleted ordestroyed, of the Company, including, without limitation, any Confidential Information, software, hardware, including any and allCompany-issued equipment, devices, cellular telephones, tablets, computers, laptops, hard drives, keys, access cards, access codes orpasswords belonging to the Company, databases, files, records, reports, memoranda, research, plans, proposals, lists, forms, drawings,specifications, notebooks, manuals, correspondence, materials, e-mail, electronic or magnetic recordings or data, and any other physicalor electronic documents that Executive receives from or sends to any employee of the Company, that Executive copies from the files orrecords of the Company, or that Executive otherwise has access to during Executive’s employment.(c) No Interference. Notwithstanding any other provision of this Agreement, (i) Executive may disclose ConfidentialInformation when required to do so by a court of competent jurisdiction, by any governmental agency having authority over Executiveor the business of the Company or by any administrative body or legislative body (including a committee thereof) with jurisdiction toorder Executive to divulge, disclose or make accessible such information; and (ii) nothing in this Agreement is intended to interferewith Executive’s right to (A) report possible violations of state or federal law or regulation to any governmental or law enforcementagency or entity; (B) make other disclosures that are protected under the whistleblower provisions of state or federal law or regulation;(C) file a claim or charge with any governmental agency or entity; or (D) testify, assist, or participate in an investigation, hearing, orproceeding conducted by anyCONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 3governmental or law enforcement agency or entity, or any court. For purposes of clarity, in making or initiating any such reports ordisclosures or engaging in any of the conduct outlined in subsection (ii) above, Executive may disclose Confidential Information to theextent necessary to such governmental or law enforcement agency or entity or such court, need not seek prior authorization from theCompany, and is not required to notify the Company of any such reports, disclosures or conduct.(d) Defend Trade Secrets Act. Executive is hereby notified in accordance with the Defend Trade Secrets Act of 2016 that Executivewill not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made inconfidence to a federal, state, or local government official, either directly or indirectly, or to an attorney solely for the purpose ofreporting or investigating a suspected violation of law, or is made in a complaint or other document that is filed under seal in a lawsuitor other proceeding.(e) Inventions.(i) Prior Inventions Retained and Licensed. In Exhibit A-1 to this Agreement, Executive has provided a list describingall Inventions (defined below) that Executive: (A) conceived, created, developed, made, reduced to practice or completed, either aloneor with others, prior to Executive’s employment with the Company; (B) claims a proprietary right or interest in; and (C) does not assignto the Company hereunder (collectively referred to as the “Prior Inventions”). If no such list is attached, Executive represents thatthere are no such Prior Inventions. Executive understands and agrees that the Company makes no attempt to verify Executive’s claimof ownership to any of the Prior Inventions. Executive agrees that Executive shall not incorporate in any work that Executive performsfor the Company any Prior Inventions or any of the technology described in any Prior Inventions. Nonetheless, if in the course ofExecutive’s employment with the Company, Executive incorporates Prior Inventions into a product, service, process or machine of theCompany, Executive hereby grants and shall be deemed to have granted the Company a nonexclusive, royalty-free, irrevocable,sublicensable, transferable, perpetual, and worldwide license to make, have made, modify, use, import, reproduce, distribute, prepareand have prepared derivative works of, offer to sell, sell and otherwise exploit such Prior Inventions. For purposes of this Agreement,the term “Inventions” means all tangible and intangible materials, work product, information, methods, designs, computer programs,software, databases, formulas, models, prototypes, reports, discoveries, ideas, improvements, know-how, compositions of matter,processes, photographs, drawings, illustrations, sketches, developments, and all related intellectual property, including inventions,original works of authorship, moral rights, mask works, trade secrets and trademarks.(ii) Assignment of Inventions. During Executive’s employment with the Company and following the termination ofExecutive’s employment for any reason, Executive agrees that Executive shall promptly make full written disclosure to the Company,shall hold in trust for the sole right and benefit of the Company, and hereby assigns and shall be deemed to have assigned to theCompany or its designee, all of Executive’s right, title, and interest in and to any and all Inventions that have been or may beconceived, created, developed, completed, reduced to practice or otherwise made by Executive, solely or jointly with others, during theperiod ofCONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 4Executive’s employment with the Company which (A) relate in any manner to the existing or contemplated business, work, orinvestigations of the Company; (B) are suggested by, result from, or arise out of any work that Executive may do for or on behalf ofthe Company; (C) result from or arise out of any Confidential Information that may have been disclosed or otherwise made available toExecutive as a result of duties assigned to Executive by the Company; or (D) are otherwise made through the use of the time,information, equipment, facilities, supplies or materials of the Company, even if developed, conceived, reduced to practice or otherwisemade during other than working hours (collectively referred to as “Company Inventions”). Executive further acknowledges that alloriginal works of authorship that are made by Executive (solely or jointly with others) within the scope of Executive’s employmentwith the Company and that are protectable by copyright are “Works Made for Hire,” as that term is defined in the United StatesCopyright Act. Executive understands and agrees that the decision whether or not to commercialize or market any CompanyInventions is within the Company’s sole discretion and for the Company’s sole benefit, and that no royalty will be due to Executive asa result of the Company’s efforts to commercialize or market any such Company Innovation.(iii) Maintenance of Records. Executive agrees to keep and maintain adequate and current hard-copy and electronicrecords of all Company Inventions. The records will be available to and remain the sole property of the Company during Executive’semployment with the Company and at all times thereafter.(f) Patent and Copyright Registrations. Executive agrees to assist the Company or its designee, at the Company’s expense, inevery proper way to secure the Company’s rights in Company Inventions in any and all countries, including the disclosure to theCompany of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments,affidavits, and all other instruments which the Company shall deem necessary in order to apply for and obtain such rights and in orderto assign and convey to the Company and/or its successors, assigns and nominees, the sole and exclusive rights, title and interest in andto such Company Inventions. Executive further agrees that Executive’s obligation to execute or cause to be executed, when it is inExecutive’s power to do so, any such instrument or papers shall continue after the termination of this Agreement. Executive herebyappoints the General Counsel of the Company as Executive’s attorney-in-fact to execute documents on Executive’s behalf for thispurpose. Executive agrees that this appointment is coupled with an interest and will not be revocable.(g) Return of Company Property. Upon request by the Company or upon the termination of Executive’s employment for anyreason, Executive shall immediately return and deliver to the Company any and all Property, including, without limitation, ConfidentialInformation, software, hardware, including any and all Company-issued equipment, devices, cellular telephones, tablets, computers,laptops, hard drives, keys, access cards, access codes or passwords, databases, files, documents, records, reports, memoranda, research,plans, proposals, lists, papers, books, forms, drawings, specifications, notebooks, manuals, correspondence, materials, e-mail,electronic or magnetic recordings or data, including all copies thereof (in electronic or hard copy format), which belong to theCompany or which relate to the Company’s business and which are in Executive’s possession, custody or control, whether preparedby Executive or others. Executive further agrees that after Executive provides such Property to the Company, Executive willimmediately destroyCONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 5any information or documents, whether prepared by Executive or others, containing or reflecting any Confidential Information orrelating to the business of the Company from any computer, cellular phone or other digital or electronic device in Executive’spossession, custody or control, and Executive shall certify such destruction in writing to the Company. Upon request by the Company,Executive shall provide such computer, cellular phone or other digital or electronic device to the Company or the Company’s designeefor inspection to confirm that such information and documents have been destroyed. If at any time after the termination of Executive’semployment for any reason, Executive or the Company determines that Executive has any Property in Executive’s possession, custodyor control, Executive shall immediately return all such Property, including all copies and portions thereof, to the Company.Restrictive Covenants. In consideration for (i) the Company’s promise to provide Confidential Information; (ii) the substantialeconomic investment made by the Company in the Confidential Information and goodwill of the Company, and/or the businessopportunities disclosed or entrusted to Executive; (iii) access to the customers and clients of the Company; and (iv) the Company’semployment of Executive in an executive position and the compensation and other benefits provided by the Company to Executive(including the consideration provided for in the Incentive Retention Letter), to protect the Confidential Information and businessgoodwill of the Company, Executive agrees to the following restrictive covenants.(a) Non-Competition. Executive agrees that during the Executive’s employment with the Company and for a period of twelve (12)months after the Executive’s employment terminates for any reason (the “Restricted Period”), other than in connection withExecutive’s performance of his duties for the Company, Executive shall not, and shall not use any Confidential Information to, withoutthe prior written consent of an executive officer of the Company, directly or indirectly, either individually or as a principal, partner,stockholder, manager, agent, consultant, contractor, distributor, employee, direct lender, individual investor, or as a director or officerof any corporation or association, or in any other manner or capacity whatsoever, (i) control, manage, operate, establish, take steps toestablish, lend money to, invest in, solicit investors for, or otherwise provide capital to, or (ii) become employed by, join, performservices for, consult for, do business with or otherwise engage in any Competing Business (other than any Competing BusinessExecutive has disclosed to the Company in writing on Exhibit A that he is engaged in on the Effective Date of this Agreement) withinthe Restricted Area (each as defined below) in a role that is substantially similar to any role the Executive has held with the Companyduring his employment. For purposes of this Agreement, given the scope of Confidential Information to be provided to Executive andjob duties to be performed by the Executive, “Restricted Area” means the United States, and any other geographic area for whichExecutive performed any services or about which Executive received Confidential Information. For purposes of this Agreement,“Competing Business” means H&R Block, Intuit, and any other business, individual, partnership, firm, corporation or other entity thatis competing or that is preparing to compete with any aspect of the Company’s business, which includes, but is not limited to (a) taxpreparation and tax preparation-related products and services provided to consumers and small businesses, and to or through taxprofessionals; (b) investment and insurance products or services, and related advice and brokerage services, provided to or through taxprofessionals or in conjunction with tax preparation services, and (c) a tax-optimized RIA or broker-CONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 6dealer, and (d) any other business the Company engages in or develops during the Executive’s employment with the Company.(a) Non-Solicitation. During the Restricted Period, other than in connection with Executive’s duties for the Company,Executive shall not, and shall not use any Confidential Information to, directly or indirectly, either as a principal, manager, agent,employee, consultant, officer, director, stockholder, partner, investor or lender or in any other capacity, and whether personally orthrough other persons, solicit business from, interfere with, or induce to curtail or cancel any business or contracts with the Company,or attempt to solicit business with, interfere with, or induce to curtail or cancel any business or contracts with the Company, or dobusiness with any actual or prospective customer or client of the Company with whom the Company did business or who theCompany solicited within the preceding two (2) years, and who or which: (1) Executive contacted, called on, serviced or did businesswith during Executive’s employment with the Company; (2) Executive learned of as a result of Executive’s employment with theCompany; or (3) about whom Executive received Confidential Information. This restriction applies only to business which is in thescope of services or products provided by the Company.(b) Non-Recruitment. During the Restricted Period, other than in connection with Executive’s duties for the Company,Executive shall not, on behalf of Executive or on behalf of any other person or entity, directly or indirectly, hire, solicit or recruit, orattempt to hire, solicit or recruit, or encourage to leave or otherwise cease his/her employment or engagement with the Company, anyindividual who is an employee or independent contractor of the Company or who was an employee or independent contractor of theCompany within the twelve (12) month period prior to Executive’s separation from employment with the Company.(c) Non-Disparagement. Executive agrees that the Company’s goodwill and reputation are assets of great value to theCompany, which have been obtained and maintained through great costs, time and effort. Therefore, Executive agrees that duringExecutive’s employment and after the termination of Executive’s employment, Executive shall not make, publish or otherwise transmitany knowingly false statements, whether written or oral, regarding the Company and its officers, directors, executives, employees,contractors, consultants, products, services, business or business practices. A violation or threatened violation of this Section 2(d) maybe enjoined by the courts. The rights afforded the Company under this provision are in addition to any and all rights and remediesotherwise afforded by law. However, nothing in this Section 2(d) restricts or prevents Executive from providing truthful testimony asrequired by court order or other legal process or is intended to interfere with Executive’s rights set forth in Section 1(c).(d) Tolling. If Executive violates any of the covenants contained in this Section 2, the Restricted Period applicable to suchcovenant(s) shall be suspended and shall not run in favor of Executive from the time of the commencement of such violation until thetime that Executive cures the violation to the satisfaction of the Company and the period of time in which Executive is in breach shallbe added to the Restricted Period applicable to such covenant(s).Reasonableness. Executive hereby represents to the Company that Executive has read and understands, and agrees to be boundby, the terms of Section 1 and Section 2. ExecutiveCONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 7acknowledges that the scope and duration of the restrictions and covenants contained in Section 1 and Section 2 are fair and reasonablein light of (i) the nature and scope of the operations of the Company’s business; and (ii) the amount of compensation and ConfidentialInformation (including, without limitation, trade secrets) that Executive is receiving in connection with Executive’s employment withthe Company and the Incentive Retention Letter. It is the desire and intent of the Parties that the provisions of Section 1 and Section 2be enforced to the fullest extent permitted under applicable law, whether now or hereafter in effect and therefore, to the extentpermitted by applicable law, Executive and the Company hereby waive any provision of applicable law that would render anyprovision of Section 1 and/or Section 2 invalid or unenforceable.Remedies. Executive acknowledges that the restrictions and covenants contained in Section 1 and Section 2, in view of thenature of the Company’s business and Executive’s position with the Company, are reasonable and necessary to protect the Company’slegitimate business interests, goodwill and reputation, and that any violation of Section 1 or Section 2 would result in irreparable injuryand continuing damage to the Company, and that money damages would not be a sufficient remedy to the Company for any suchbreach or threatened breach. Therefore, Executive agrees that the Company shall be entitled to a temporary restraining order andinjunctive relief restraining Executive from the commission of any breach or threatened breach of Section 1 and/or Section 2, withoutthe necessity of establishing irreparable harm or the posting of a bond, and to recover from Executive damages incurred by theCompany as a result of the breach, as well as the Company’s attorneys’ fees, costs and expenses related to any breach or threatenedbreach of this Agreement and enforcement of this Agreement. Nothing contained in this Agreement shall be construed as prohibitingthe Company from pursuing any other remedies available to it for any breach or threatened breach, including, without limitation, therecovery of money damages, attorneys’ fees, and costs. The existence of any claim or cause of action by Executive against theCompany, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of therestrictions or covenants contained in Section 1 or Section 2, or preclude injunctive relief.Business Opportunities. Executive, without further compensation, assigns and agrees to assign to the Company and itssuccessors, assigns or designees, all of Executive’s right, title and interest in and to all Business Opportunities (defined below), andfurther acknowledges and agrees that all Business Opportunities constitute the exclusive property of the Company. Executive shallpresent all Business Opportunities to the Company, and shall not exploit a Business Opportunity. For purposes of this Agreement,“Business Opportunities” means all business ideas, prospects, or proposals pertaining to any aspect of the Company’s business andany business the Company prepared to conduct or contemplated conducting during Executive’s employment with the Company, whichare developed by Executive or originated by any third party and brought to the attention of Executive, together with informationrelating thereto. For the avoidance of doubt, this Section 5 is not intended to limit or narrow Executive’s duties or obligations underfederal or state law with respect to corporate opportunities.Conflicting Activities. Executive agrees that, during Executive’s employment with the Company, Executive shall not engage inany employment, consulting relationship, business or other activity that (i) is in any way competitive with the business or proposedbusiness of the CompanyCONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 8(except that Executive may invest less than one percent (1%) of the shares of a company traded on a registered stock exchange); (ii)conflicts with Executive’s duty of loyalty, responsibilities or obligations to the Company or interferes with the independent exercise ofExecutive’s judgment in the Company’s best interests; or (iii) adversely affects the performance of Executive’s job duties andresponsibilities with the Company. Executive agrees to not assist any other person or organization in competing with the Company orin preparing to engage in competition with the Company or proposed business of the Company. Executive further agrees that, duringExecutive’s employment with the Company, Executive shall not actively engage in any other employment, occupation or consultingactivity for any direct or indirect remuneration without the prior approval of Executive’s direct supervisor or the Company’s LegalDepartment. Executive has listed on the Company’s Outside Activity Disclosure form, attached hereto as Exhibit B-1, any businessactivities or ventures with which Executive is involved. If no such list is attached, Executive represents that there are no such outsideactivities as of the date of this Agreement.Breach Executive acknowledges that Executive is subject to immediate dismissal by the Company for any breach of thisAgreement and that such a dismissal will not relieve Executive from any continuing obligations under this Agreement or from theimposition by a court of any judicial remedies, including, without limitation, money damages and/or injunctive relief for such breach.Notice. If Executive, in the future, seeks or is offered employment, or any other position or capacity with another company,entity or person, Executive agrees to inform each such company, entity or person of the existence of the restrictions in Section 1 andSection 2. The Company shall be entitled to advise such company, entity or person and third parties of the provisions of Section 1 andSection 2 and to otherwise deal with such company, entity, person or third party to ensure that the provisions of Section 1 and Section2 are enforced and duly discharged.Reformation. The Company and Executive agree that in the event any of the terms, provisions, covenants or restrictionscontained in this Agreement, or any part thereof, shall be held by any court of competent jurisdiction to be effective in any particulararea or jurisdiction only if said term, provision, covenant or restriction is modified to limit its duration or scope, then the court shallhave such authority to so reform the term, provision, covenant or restriction and the Parties hereto shall consider such term, provision,covenant or restriction to be amended and modified with respect to that particular area or jurisdiction so as to comply with the order ofany such court and, as to all other jurisdictions, the term, provision, covenant or restriction contained herein shall remain in full forceand effect as originally written. By agreeing to this contractual modification prospectively at this time, the Company and Executiveintend to make Section 1 and Section 2 enforceable under the law or laws of all applicable jurisdictions so that the restrictive covenantsin their entirety and this Agreement as prospectively modified shall remain in full force and effect and shall not be rendered void orillegal.Severability. In the event any court of competent jurisdiction or any foreign, federal, state, county or local government or anyother governmental regulatory or administrative agency or authority holds any provision of this Agreement to be invalid, illegal orunenforceable, such invalid, illegal or unenforceable portion(s) shall be limited or excluded from this Agreement to the minimumCONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 9extent required, and the remaining provisions shall not be affected or invalidated and shall remain in full force and effect.Binding Effect of Agreement and Assignment. This Agreement shall be binding upon and inure to the benefit of the Partieshereto and their respective heirs, successors, legal representatives and permitted assigns. Executive may not assign this Agreement to athird party. The Company may assign its rights, together with its obligations hereunder, to any affiliate and/or subsidiary of theCompany or any successor thereto or any purchaser of substantially all of the assets of the Company, without Executive’s consent andwithout advance notice.Survival. Executive agrees that Executive’s obligations under this Agreement shall continue in effect after the termination ofExecutive’s employment, regardless of the reason(s) for termination, and whether such termination is voluntary or involuntary.Waiver. The failure of either Party to insist in any one or more instances upon performance of any terms or conditions of thisAgreement shall not be construed as a waiver of future performance of any such term, covenant or condition, but the obligations ofeither Party with respect thereto shall continue in full force and effect. No waiver of any breach of this Agreement shall be construed tobe a waiver as to succeeding breaches and no waiver of any provisions of this Agreement shall constitute a waiver of any otherprovision of this Agreement. The breach by one party to this Agreement shall not preclude equitable relief, injunctive relief or theobligations in Section 1 or Section 2.Controlling Law. This Agreement shall be governed by and construed under the laws of the State of Texas, without regard toany applicable conflict of law or choice of law rules.Venue. Venue of any dispute arising out of, in connection with or in any way related to this Agreement shall be in a statedistrict court of competent jurisdiction in Dallas County, Texas, or the United States District Court for the Northern District of Texas.Executive consents to personal jurisdiction of the state district courts of Dallas County, Texas and to the United States District Courtfor the Northern District of Texas for any dispute arising out of, in connection with or in any way related to this Agreement, and agreesthat Executive shall not challenge personal jurisdiction in such courts. Executive waives any objection that Executive may now orhereafter have to the venue or jurisdiction of any proceeding in such courts or that any such proceeding was brought in an inconvenientforum (and agrees not to plead or claim the same).WAIVER OF JURY TRIAL. WITH RESPECT TO ANY DISPUTE BETWEEN EMPLOYEE AND THE COMPANYARISING OUT OF, IN CONNECTION WITH OR IN ANY WAY RELATED TO THIS AGREEMENT, EMPLOYEEAGREES TO RESOLVE SUCH DISPUTE(S) BEFORE A JUDGE WITHOUT A JURY. EMPLOYEE HAS KNOWLEDGEOF THIS PROVISION, AND WILL PROVIDE SERVICES TO THE COMPANY THEREAFTER, HEREBY WAIVINGEMPLOYEE’S RIGHT TO TRIAL BY JURY AND AGREES TO HAVE ANY DISPUTE(S) ARISING BETWEEN THECOMPANY AND EMPLOYEE ARISING OUT OF, IN CONNECTION WITH OR IN ANY WAY RELATED TO THISAGREEMENT RESOLVED BY A JUDGE OF A COMPETENT COURT IN DALLAS COUNTY, TEXAS, SITTINGWITHOUT A JURY.CONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 10Entire Agreement. This Agreement constitutes the entire agreement between the Parties with respect to the subject matterhereof, and fully supersedes any and all prior and contemporaneous agreements, understandings and/or representations between theParties, whether oral or written, pertaining to the subject matter of this Agreement; provided, however, Executive’s obligations underthis Agreement are in addition to Executive’s obligations under any applicable law or regulation and the Company’s policies andprocedures. No oral statements or prior written material not specifically incorporated in this Agreement shall be of any force and effect,and no changes in or additions to this Agreement shall be recognized, unless incorporated in this Agreement by written amendment,such amendment to become effective on the date stipulated in it. Any amendment to this Agreement must be signed by all parties tothis Agreement.Disclaimer of Reliance. Except for the specific representations expressly made by the Company in this Agreement, Executivespecifically disclaims that Executive is relying upon or has relied upon any communications, promises, statements, inducements, orrepresentation(s) that may have been made, oral or written, regarding the subject matter of this Agreement. Executive represents thatExecutive relied solely and only on Executive’s own judgment in making the decision to enter into this Agreement.Voluntary Agreement. Executive (i) acknowledges that Executive has read and understands the terms of this Agreement andbelieves them to be reasonable, (ii) agrees that the consideration provided by the Company for this Agreement is reasonable, and (iii) isvoluntarily executing this Agreement as signified by Executive’s signature hereto.Execution in Multiple Counterparts. This Agreement may be executed in multiple counterparts, whether or not all signatoriesappear on these counterparts, and each counterpart shall be deemed an original for all purposes.[Signature Page Follows]CONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 11The signatures below indicate that the Parties have read, understand and will comply with this Agreement. EXECUTIVE: Printed Name: Todd C. Mackay Date: THE COMPANY:Blucora, Inc.: Signature: Name: Title: Date: CONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 12EXHIBIT A-1 LIST OF PRIOR INVENTIONSTitleDateIdentifying Number or Brief Description ____ No Inventions____ Additional Sheets Attached Signature of Employee: /s/ Todd Mackay Print Name of Employee: Todd Mackay Date: December 24, 2018CONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 13EXHIBIT A-2 OUTSIDE ACTIVITIESCONFIDENTIALITY AND NON-SOLICITATION AGREEMENT Page 14EXHIBIT B GENERAL RELEASE OF ALL CLAIMSThis General Release and Waiver of Claims (this “Release”) is executed by Todd C. Mackay (“Executive”) and Blucora, Inc.(the “Company”) as of the date set forth below, and will become effective as of the “Effective Date” as defined below. This Release isin consideration of severance benefits to be paid to Executive by the Company pursuant to the Employment Agreement betweenExecutive and the Company dated as of January ___, 2018 (the “Employment Agreement”). Execution of this Release withoutrevocation by Executive will satisfy the requirement, set forth in Section 6(g) of the Employment Agreement, that Executive execute ageneral release and waiver of claims in order to receive severance benefits pursuant to the Employment Agreement.1. Termination of EmploymentExecutive acknowledges that his employment with the Company and any of its subsidiaries (collectively, the “CompanyGroup”) and any and all appointments he held with any member of the Company Group, whether as officer, director, employee,consultant, agent or otherwise, terminated as of _______________________ (the “Termination Date”). Effective as of theTermination Date, Executive has not had or exercised or purported to have or exercise any authority to act on behalf of the Companyor any other member of the Company Group, nor will Executive have or exercise or purport to have or exercise such authority in thefuture.2. ConsiderationThe Company shall pay Executive the severance benefits pursuant to the Employment Agreement. The Parties agree that butfor signing this Release, Executive would not be entitled to the severance benefits set forth in the Employment Agreement. Theseverance benefits are adequate to make this Release final and binding, and are in addition to payments and benefits to whichExecutive would otherwise be entitled to as an employee or former employee of the Company.3. Waiver and Release(a) Executive, for and on behalf of himself and his heirs and assigns, hereby waives and releases any common law, statutoryor other complaints, claims, charges or causes of action arising out of or relating to Executive’s employment or termination ofemployment with, or Executive’s serving in any capacity in respect of any member of the Company Group (collectively, “Claims”).The Claims waived and released by this Release include any and all Claims, whether known or unknown, whether in law or in equity,which Executive may now have or ever had against any member of the Company Group or any shareholder, employee, officer,director, agent, attorney, representative, trustee, administrator or fiduciary of any member of the Company Group (collectively, the“Company Releasees”) up to and including the date of Executive’s execution of this Agreement. The Claims waived and released bythis Release include, without limitation, any and all Claims arising out of Executive’s employment with the Company Group under, byway of example and not limitation, the Age Discrimination in Employment Act of 1967 (“ADEA”, a law which prohibitsdiscrimination on the basis of age against persons age 40 and older), the National1Labor Relations Act, the Civil Rights Act of 1991, the Americans With Disabilities Act of 1990, Title VII of the Civil Rights Act of1964, the Employee Retirement Income Security Act of 1974, the Family Medical Leave Act, the Securities Act of 1933, theSecurities Exchange Act of 1934, and the Texas Labor Code Chapter 21, all as amended, and all other federal, state and local statutes,ordinances, regulations and the common law, and any and all Claims arising out of any express or implied contract, except as describedin Paragraphs 2(b) and 2(c) below.(b) The waiver and release set forth in this Section 3 is intended to be construed as broadly and comprehensively asapplicable law permits. The waiver and release shall not be construed as waiving or releasing any claim or right that as a matter of lawcannot be waived or released, including Executive’s right to file a charge with the Equal Employment Opportunity Commission orother government agency.(c) Notwithstanding anything else in this Release, Executive does not waive or release claims with respect to:(i) Executive’s entitlement, if any, to severance benefits pursuant to the Employment Agreement;(ii) vested benefits or payments specifically to be provided to the Executive pursuant to the Employment Agreementor any Company employee benefit plans or policies;(iii) indemnification pursuant to any applicable provision of the Company’s Bylaws or Certificate of Incorporation, asamended, pursuant to any written indemnification agreement between the Executive and the Company, or pursuant to applicable law;(iv) any claims which the Executive may have solely by virtue of the Executive’s status as a shareholder of theCompany; or(v) unemployment compensation to which Executive may be entitled under applicable law.(d) Executive represents and warrants that he is the sole owner of the actual or alleged Claims that are released hereby, thatthe same have not been assigned, transferred, or disposed of in fact, by operation of law, or in any manner, and that he has the full rightand power to grant, execute and deliver the releases, undertakings, and agreements contained herein.(e) Subject to Section 4, Executive represents that Executive has not filed any complaints, charges or lawsuits against theCompany with any governmental agency or any court based on Claims that are released and waived by this Release.4. No InterferenceNothing in this Agreement is intended to interfere with Executive’s right to report possible violations of federal, state or locallaw or regulation to any governmental or law enforcement agency or entity, or to make other disclosures that are protected under thewhistleblower provisions of federal, state or local law or regulation. Executive further acknowledges that nothing in this2Agreement is intended to interfere with Executive’s right to file a claim or charge with, or testify, assist, or participate in aninvestigation, hearing, or proceeding conducted by, the Equal Employment Opportunity Commission (the “EEOC”), any state humanrights commission, or any other government agency or entity. However, by executing this Agreement, Executive hereby waives theright to recover any damages or benefits in any proceeding Executive may bring before the EEOC, any state human rights commission,or any other government agency or entity or in any proceeding brought by the EEOC, any state human rights commission, or any othergovernment agency or entity on Employee’s behalf with respect to any claim released in this Agreement except that Executive mayreceive bounty money awarded by the U.S. Securities and Exchange Commission pursuant to Section 21F of the Securities ExchangeAct of 1934 or any similar provision.5. No Admission of WrongdoingThis Release shall not be construed as an admission by either party of any wrongful or unlawful act or breach of contract.6. Legal Disclosure.Subject to Section 4, by signing this Agreement, Executive warrants and represents that Executive has reported to HumanResources or Legal all pending and/or threatened legal proceedings of any kind involving or relating to the Company that Executivebecame aware of during Executive’s tenure with the Company. Executive further warrants and represents that Executive has reportedto Human Resources or Legal any alleged violations of law (including alleged securities violations) by the Company that Executivebecame aware of during Executive’s tenure with the Company.7. Binding Agreement; Successors and AssignsThis Release binds Executive’s heirs, administrators, representatives, executors, successors, and assigns, and will inure to thebenefit of the respective heirs, administrators, representatives, executors, successors, and assigns of any person or entity as to whom thewaiver and release set forth in Section 3 applies.8. Other AgreementsThis Release does not supersede or modify in any way Executive’s continuing obligations pursuant to the EmploymentAgreement or the Confidentiality and Non-Competition Agreement (Exhibit A thereto) or the dispute resolution provisions of theEmployment Agreement.9. Knowing and Voluntary Agreement; Consideration and Revocation Periods(a) Executive acknowledges that Executive has been given twenty-one (21) calendar days from the date of receipt of thisRelease to consider all of the provisions of this Release and that if Executive signs this Release before the 21-day period has ended heknowingly and voluntarily waives some or all of such 21-day period.(b) Executive represents that (i) Executive has read this Release carefully, (ii) Executive has hereby been advised by theCompany to consult an attorney of his choice and has either done3so or voluntarily chosen not to do so, (iii) Executive fully understands that by signing below he is giving up certain rights which hemight otherwise have to sue or assert a claim against any of the Company Releasees, and (iv) Executive has not been forced orpressured in any manner whatsoever to sign this Release, and agrees to all of its terms voluntarily.(c) Executive shall have seven (7) calendar days from the date of his execution of this Release (the “Revocation Period”) inwhich Executive may revoke this Release. Such revocation must be in writing and delivered, prior to the expiration of the RevocationPeriod, to the attention of the Company’s Chief Legal Officer at the Company’s then-current headquarters address. If Executiverevokes this Release during the Revocation Period, then the Release shall be null and void and without effect.10. Disclaimer of RelianceExcept for the specific representations expressly made by the Company in the Employment Agreement, Executive specificallydisclaims that Executive is relying upon or has relied upon any communications, promises, statements, inducements, orrepresentation(s) that may have been made, oral or written, regarding the subject matter of this Release. Executive represents thatExecutive relied solely and only on Executive’s own judgment in making the decision to enter into this Release.11. Execution in Multiple CounterpartsThis Release may be executed by the parties in multiple counterparts, whether or not all signatories appear on thesecounterparts (including via electronic signatures and exchange of PDF documents via email), each of which shall be deemed anoriginal, but all of which together shall constitute one and the same instrument.12. Effective DateThe Effective Date of this Release will be day after the Revocation Period expires without revocation by Executive.[Signature Page Follows]4EXECUTIVE HAS ELECTED FREELY AND VOLUNTARILY TO EXECUTE THIS RELEASE, TO FULFILL THEPROMISES SET FORTH IN THE EMPLOYMENT AGREEMENT, AND TO RECEIVE THEREBY THE PAYMENT ANDOTHER CONSIDERATION DESCRIBED IN THE EMPLOYMENT AGREEMENT. EXECUTIVE UNDERSTANDS THAT,BY SIGNING THIS RELEASE, EXECUTIVE IS AGREEING TO WAIVE AND SETTLE THE RELEASED CLAIMSHEREIN THAT EXECUTIVE HAS OR MIGHT HAVE AGAINST THE COMPANY INCLUDING CLAIMS UNDER THEAGE DISCRIMINATION IN EMPLOYMENT ACT. EXECUTIVE’S SIGNATURE BELOW MEANS THAT EXECUTIVEHAS READ THE RELEASE AND UNDERSTANDS AND AGREES THAT EXECUTIVE IS RELEASING ALL CLAIMSAND AGREES AND CONSENTS TO THE TERMS AND CONDITIONS OF THIS EMPLOYMENT AGREEMENT ANDTHIS RELEASE.EXECUTIVE:Signature: _____________________ Printed Name: Todd C. Mackay Date: _____________________ THE COMPANY:Blucora, Inc.: Signature: ____________________ Name: _____________________ Title: _____________________ Date: _____________________ 5Exhibit 10.34EMPLOYMENT AGREEMENTThis Employment Agreement (this “Agreement”) is made and entered into as of October 12, 2018, by and between CurtisCampbell (the “Executive”) and Blucora, Inc. (the “Company”).RECITALSWHEREAS, the Company desires to employ the Executive as the President of TaxAct beginning on November 5, 2018 (the“Effective Date”), and the Executive desires to serve in such capacity;NOW THEREFORE, in consideration of the foregoing, the mutual covenants contained herein, the employment of theExecutive by the Company, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,the parties hereto agree as follows:1.Certain Definitions(a) “Base Salary” has the meaning set forth in Section 5(a).(b) “Board” means the Board of Directors of the Company.(c) “Cause” means, as determined by the Board in its reasonable discretion: (i) the Executive’s conviction of, or plea of guiltyor nolo contendere to, a misdemeanor involving dishonesty, wrongful taking of property, immoral conduct, bribery or extortion or anyfelony; (ii) willful material misconduct by the Executive in connection with the business of the Company; (iii) the Executive’scontinued and willful failure to perform substantially his responsibilities to the Company under this Agreement, after written demandfor substantial performance has been given by the Board that specifically identifies how the Executive has not substantially performedhis responsibilities; (iv) the Executive’s improper disclosure of confidential information or other material breach of this Agreement,including the Confidentiality and Non-Competition Agreement; (v) the Executive’s material fraud or dishonesty against the Company;(vi) the Executive’s willful and material breach of the Company’s written code of conduct and business ethics or other material writtenpolicy, procedure or guideline in effect from time to time (provided that the Executive was given access to a copy of such policy,procedure or guideline prior to the alleged breach) relating to personal conduct; or (vii) the Executive’s willful attempt to obstruct orwillful failure to cooperate with any investigation authorized by the Board or any governmental or self-regulatory entity. Anydetermination of Cause by the Company shall be made by a resolution approved by a majority of the members of the Board, providedthat, with respect to Section 1(c)(iii), the Board must give the Executive notice and 60 days to cure the substantial nonperformance.(d) “Change of Control” means the occurrence of any of the following:(i) any “person” (as defined in Sections 13(d) and 14(d) of the Exchange Act), excluding for this purpose, (A) theCompany or any subsidiary of the Company or (B) any employee benefit plan of the Company or any subsidiary of the Company, orany person or entity organized,appointed or established by the Company for or pursuant to the terms of any such plan that acquires beneficial ownership of votingsecurities of the Company, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly orindirectly, of securities of the Company representing more than 50% of the combined voting power of the Company’s then outstandingsecurities;(ii) consummation of a reorganization, merger or consolidation of the Company, in each case, unless, following suchtransaction, all or substantially all the individuals and entities who were the beneficial owners of outstanding voting securities of theCompany immediately prior to such transaction beneficially own, directly or indirectly, more than 50% of the combined voting powerof the then outstanding voting securities entitled to vote generally in the election of directors of the company resulting from suchtransaction (including, without limitation, a company that, as a result of such transaction, owns the Company or all or substantially allthe Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownershipimmediately prior to such transaction of the outstanding voting securities of the Company;(iii) any sale or disposition by the Company, in one transaction or a series of related transactions, of all or substantiallyall the Company’s assets;(iv) a “Board Change” which, for purposes of this Agreement, shall have occurred if a majority of the seats on theBoard are occupied by individuals who were neither (A) nominated by a majority of the Incumbent Directors nor (B) appointed bydirectors so nominated (“Incumbent Director” means a member of the Board who has been either (1) nominated by a majority of thedirectors of the Company then in office or (2) appointed by directors so nominated, but excluding, for this purpose, any such individualwhose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by oron behalf of a person other than the Board); or(v) an approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.(e) “Code” means the Internal Revenue Code of 1986, as amended.(f) “Compensation Committee” means the Compensation Committee of the Board.(g) “Confidentiality and Non-Competition Agreement” means the Confidentiality and Non-Competition Agreement attachedhereto as Exhibit A.(h) “Constructive Termination” means the occurrence, on a date that is prior to the two- month period prior to theconsummation of a Change of Control or after the 12-month period following the consummation of a Change of Control, of any of thefollowing without the Executive’s express prior written consent: (i) a material reduction of or to the Executive’s duties, authority orresponsibilities (a change in reporting relationship alone does not constitute such a material reduction); (ii) a material reduction by theCompany of the Executive’s Base Salary, unless similarly situated executives also experience a reduction; or (iii) a requirement that theExecutive relocate2his primary work location more than 25 miles from Irving, Texas or from any work location to which the Company transfers theExecutive during the course of his employment and to which such transfer the Executive has consented. Notwithstanding theforegoing, a Constructive Termination shall not exist unless (x) the Executive delivers written notice to the Company (the“Constructive Termination Notice”) of the existence of the condition which the Executive believes constitutes a ConstructiveTermination within 30 days of the initial existence of such condition (which Constructive Termination Notice specifically identifiessuch condition), (y) the Company fails to remedy such condition within 30 days after the date on which it receives such notice (the“Constructive Termination Cure Period”), and (z) the Executive actually terminates employment within 30 days after the expirationof the Constructive Termination Cure Period.(i) “Disability” means the Executive’s inability to perform his employment duties to the Company hereunder, with or withoutreasonable accommodation, for 180 days (in the aggregate) in any one-year period as determined by an independent physician selectedby the Company.(j) “Exchange Act” means the Securities Exchange Act of 1934, as amended.(k) “Good Reason” means the occurrence of any of the following without the Executive’s express prior written consent: (i) amaterial reduction of or to the Executive’s duties, authority, responsibilities or reporting relationship; (ii) a material reduction of theExecutive’s Base Salary; (iii) a material reduction of the Executive’s Target Bonus; (iv) a material reduction in the kind or level ofemployee benefits to which the Executive is entitled that occurs within 12 months following a Change of Control, unless similarlysituated employees also experience a reduction; (v) a requirement that the Executive relocate his primary work location more than 25miles from Irving, Texas or from any work location to which the Company transfers the Executive during the course of hisemployment and to which such transfer the Executive has consented; (vi) in connection with a Change of Control, the failure of theCompany to assign this Agreement to a successor to the Company or the failure of a successor to the Company to explicitly assumeand agree to be bound by this Agreement in a writing delivered to the Executive; or (vii) a material breach of this Agreement by theCompany.Notwithstanding the foregoing, termination of employment by the Executive will not be for Good Reason unless (x) theExecutive delivers written notice to the Company (the “Good Reason Notice”) of the existence of the condition which the Executivebelieves constitutes Good Reason within 30 days of the initial existence of such condition (which Good Reason Notice specificallyidentifies such condition), the Company fails to remedy such condition within 30 days after the date on which it receives such notice(the “Good Reason Cure Period”), and (z) the Executive actually terminates employment within 30 days after the expiration of theGood Reason Cure Period.(l) “Release” means a full release of claims against the Company substantially in the form attached hereto as Exhibit B;provided, however, that notwithstanding the foregoing, such Release is not intended to and will not waive the Executive’s rights: (i) toindemnification pursuant to any applicable provision of the Company’s Bylaws or Certificate of Incorporation, as amended, pursuantto any written indemnification agreement between the Executive and the Company, or pursuant to applicable law; (ii) to vested benefitsor payments specifically to be provided to the Executive under this Agreement or any Company employee benefit plans or policies; or(iii)3respecting any claims the Executive may have solely by virtue of the Executive’s status as a stockholder of the Company. The Releasealso shall not include claims that an employee cannot lawfully release through execution of a general release of claims.(m) “Section 409A” means Section 409A of the Code and the Treasury Regulations and official guidance issued in respect ofSection 409A of the Code.(n) “Target Bonus” has the meaning set forth in Section 5(b).2.Duties and Scope of EmploymentThe Company shall employ the Executive in the position of President of TaxAct. The Executive shall report directly to theCompany’s President and Chief Executive Officer. The Executive will render such business and professional services in theperformance of the Executive’s duties, consistent with the Executive’s position(s) within the Company, as shall be reasonably assignedto the Executive at any time and from time to time by the Company’s President and Chief Executive Officer. Upon termination of theExecutive’s employment for any reason, unless otherwise requested by the President and Chief Executive Officer, the Executive willbe deemed to have resigned from all positions held at the Company and its affiliates voluntarily, without any further action by theExecutive, as of the end of the Executive’s employment, and the Executive, at the President and Chief Executive Officer’s request, willexecute any documents necessary to reflect his resignation.3.ObligationsWhile employed hereunder, the Executive will perform his duties ethically, faithfully and to the best of the Executive’s abilityand in accordance with law and Company policy. The Executive agrees not to actively engage in any other employment, occupation orconsulting activity for any direct or indirect remuneration without the express prior written approval of the Company’s President andChief Executive Officer; provided, however, that notwithstanding anything to the contrary in the Confidentiality and Non-CompetitionAgreement, the Executive may engage in charitable activities so long as such activities do not materially interfere with the Executive’sresponsibilities to the Company.4.Agreement TermUnless earlier terminated as provided herein, the term of this Agreement (the “Agreement Term”) shall be for a period of threeyears commencing on the Effective Date, and may be extended thereafter upon the written mutual agreement of the Executive and theCompany.5.Compensation and Benefits(a) Base Salary. The Company agrees to pay the Executive a base salary (the “Base Salary”) at an annual rate of not less than$380,000, payable in accordance with the regular payroll practices of the Company, but not less frequently than monthly. TheExecutive’s Base Salary shall be subject to annual review by the Board (or a committee thereof).4(b) Annual Bonus. The Executive shall be eligible to participate in the Company’s bonus and other incentive compensationplans and programs for the Company’s senior executives at a level commensurate with his position. The Executive shall have theopportunity to earn an annual target bonus (the “Target Bonus”) measured against criteria to be determined by the Board (or acommittee thereof) of at least 125% of Base Salary. The Executive’s Target Bonus amount for 2018 will be pro-rated to reflect thenumber of days of the Executive’s employment in 2018. The payout of any 2018 bonus will occur following the end of theCompany’s Executive Bonus Plan (the “Plan”) year, which is December 31, 2018, and will be paid in accordance with the terms andconditions of the Plan. Payment of any bonus pursuant to this Section 5(b) is subject to the Executive’s employment by the Companyon the date required in the Plan. The Company reserves the right to change the Plan at any time at its discretion.(c) Equity Awards. The Executive will be eligible to participate in the Company’s long-term equity incentive programsextended to senior executives of the Company generally at levels commensurate with the Executive’s position, which participation andlevels shall be determined by the Board (or a committee thereof) in its sole discretion. In 2019, the Company’s President and ChiefExecutive Officer shall recommend that the Board (or a committee thereof) grant the Executive, for 2019, equity award(s) with a totalaggregate target value of $950,000 on the date of grant, with such award(s) consisting of a combination of the following types ofawards as determined by the Board (or a committee thereof), in its sole discretion: time-based restricted stock units (vesting over threeyears), performance-based restricted stock units (eligible for vesting based on performance following a three-year performance period),and/or nonqualified stock options (vesting over three years); provided, however, that the Board (or committee thereof) retains the solediscretion to establish the terms and the types of awards that are granted to the Executive with respect to 2019.(d) Benefits. The Executive and his eligible dependents shall be eligible to participate in the employee benefit plans that areavailable or that become available to other employees of the Company, with the adoption or maintenance of such plans to be in thediscretion of the Company, subject in each case to the generally applicable terms and conditions of the plan or program in question andto the determination of any committee administering such plan or program. Such benefits shall include participation in the groupmedical, life, disability, and retirement plans that are made generally available to employees of the Company, and any supplementalplans available to senior executives of the Company from time to time. The Company reserves the right to change or terminate itsemployee benefit plans and programs at any time.(e) Expenses. The Company shall reimburse the Executive for reasonable business expenses incurred by the Executive in thefurtherance of or in connection with the performance of the Executive’s duties hereunder, in accordance with the Company’s expensereimbursement policy as in effect from time to time.(f) Replacement Compensation and Signing Bonus.(i) Signing Bonus. The Company will pay Executive a signing bonus of $350,000, less social security contributions,income tax withholding, and any other applicable deductions, within 30 days following the Effective Date (“Signing Bonus”). IfExecutive resigns his employment with the Company for any reason, or if Executive is terminated by the Company5for Cause, and such resignation or termination occurs on or before the one-year anniversary of the Effective Date, Executive will repayto the Company the Signing Bonus.(ii) Initial Equity Award. As a material inducement to the Executive’s willingness to accept employment with theCompany and to compensate the Executive for equity granted by his prior employer that he forfeited by accepting employment withthe Company, on or shortly following the Effective Date, the Executive shall be granted an award of time-based restricted stock unitshaving an aggregate value of $250,000 on the date of grant that vest on the one-year anniversary of the date of grant so long asExecutive is employed by the Company on such date (the “Initial RSUs”).The number of Initial RSUs granted to the Executive in accordance with this Section 5(f)(ii) shall be determined by dividing the valueof the Initial RSUs being awarded by the closing price of the Company’s common stock on the date of grant and rounding down forany fractional shares. The Initial RSUs may be granted under the Blucora, Inc. 2016 Equity Inducement Plan, as amended (the“Inducement Plan”), or the Blucora, Inc. 2018 Long-Term Incentive Plan (the “LTIP”) and will vest in accordance with, and havesuch other terms and conditions as are specified in, the Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreementapproved by the Compensation Committee with respect to such award (the “Restricted Stock Unit Agreement”) and shall otherwise besubject to the terms and conditions of the Inducement Plan or LTIP and the Restricted Stock Unit Agreement; provided, however, thatnotwithstanding the foregoing, in the event of a conflict between the terms and conditions of the Restricted Stock Unit Agreement andthis Agreement, the terms and conditions of this Agreement shall prevail.6.Termination of Employment(a) General Provisions. This Agreement and the Executive’s employment with the Company may be terminated by either theExecutive or the Company at will at any time with or without Cause; provided, however, that the parties’ rights and obligations uponsuch termination during the Agreement Term shall be as set forth in applicable provisions of this Agreement.(b) Any Termination by Company or the Executive. In the event of any termination of the Executive’s employment with theCompany, whether by the Company or by the Executive, (i) the Company shall pay the Executive any unpaid Base Salary due forperiods prior to the date of termination of employment (“Termination Date”); (ii) the Company shall pay the Executive any unpaidbonus compensation pursuant to Section 5(b), to the extent earned through the Termination Date, subject to the terms of theCompany’s Executive Bonus Plan (or any successor plan thereto); and (iii) following submission of proper expense reports by theExecutive, the Company shall reimburse the Executive for all expenses reasonably and necessarily incurred by the Executive inconnection with the business of the Company through the Termination Date (collectively, the “Accrued Obligations”). The AccruedObligations shall be paid promptly upon termination and within the period of time mandated by applicable law (but, in any event,within 30 days after the Termination Date). The Accrued Obligations paid or provided pursuant to this Section 6(b) shall be in additionto the payments and benefits, if any, to be provided to the Executive upon his termination of employment pursuant to Section 6(c),6(d), 6(e), or 6(f) as applicable. Except as6expressly stated above or as required by law or this Agreement, the Executive shall receive no further compensation in any form otherthan as set forth in this Section 6(b).(c) Termination by Company Without Cause or Constructive Termination. If, other than in connection with a Change ofControl as described in Section 6(d), the Executive’s employment with the Company is terminated by the Company without Cause orthe Executive terminates employment with the Company under circumstances constituting a Constructive Termination, then subject toSection 6(g), the Executive shall receive the following payments and benefits:(i) a severance payment in an amount equal to one times the Executive's Base Salary in effect as of the TerminationDate (or if the Executive terminates employment under circumstances constituting a Constructive Termination due to a materialreduction of the Executive's Base Salary, in effect immediately prior to such reduction) (less applicable withholding taxes), whichamount shall be payable in a single lump sum on the first payroll date that is at least 60 days following the Termination Date (but, inany event, by no later than March 15 of the calendar year immediately following the calendar year that includes the Termination Date),in accordance with Section 14(b)(ii); and(ii) a lump-sum payment in an amount equal to (A) the monthly COBRA premium in effect under the Company’sgroup health plan as of the Termination Date for the coverage in effect under such plan for the Executive (and the Executive’s spouseand dependent children) on such date multiplied by (B) 12 (less applicable withholding taxes), which amount shall be payable in asingle lump sum on the first payroll date that is at least 60 days following the Termination Date (but, in any event, by no later thanMarch 15 of the calendar year immediately following the calendar year that includes the Termination Date), in accordance withSection 14(b)(ii); provided, however, that notwithstanding the foregoing or any other provision in this Agreement to the contrary, theCompany (or its successor) may unilaterally amend this Section 6(c)(ii) or eliminate the benefit provided hereunder to the extent itdeems necessary to avoid the imposition of excise taxes, penalties or similar charges on the Company or any of its subsidiaries,affiliates or successors, including, without limitation, under Section 4980D of the Code.Notwithstanding any provision to the contrary in any Company equity compensation plan or any outstanding equity awardagreement, if, during the Agreement Term, the Executive terminates employment with the Company under circumstances described inthis Section 6(c), there shall be no acceleration of vesting or exercisability of any outstanding equity awards or extension of any optionpost- termination exercise period.For the avoidance of doubt, under no circumstances will the Executive be entitled to payments and benefits under both thisSection 6(c) and Section 6(d).(d) Termination of Employment in Connection With a Change of Control. If the Company terminates the Executive’semployment without Cause or the Executive terminates employment with the Company for Good Reason (1) on the day of or duringthe 12-month period immediately following the consummation of a Change of Control or (2) during the 2-month period prior to theconsummation of a Change of Control but at the request of any third party participating in or causing the Change of Control orotherwise in connection with the Change of Control, then7subject to Section 6(g) and with respect to clause (2), subject to the consummation of such Change of Control, the Executive shallreceive the following payments and benefits:(i) a severance payment in an amount equal to one times the Executive's Base Salary in effect as of the TerminationDate and his then current Target Bonus amount (or if the Executive terminates employment for Good Reason due to a materialreduction of the Executive's Base Salary or Target Bonus, in effect immediately prior to such reduction) (in each case less applicablewithholding taxes), which amount shall be payable in a single lump sum on the first payroll date that is at least 60 days following theTermination Date (but, in any event, by no later than March 15 of the calendar year immediately following the calendar year thatincludes the Termination Date), in accordance with Section 14(b)(ii);(ii) a lump-sum payment in an amount equal to (A) the monthly COBRA premium in effect under the Company’sgroup health plan as of the Termination Date for the coverage in effect under such plan for the Executive (and the Executive’s spouseand dependent children) on such date multiplied by (B) 12 (less applicable withholding taxes), which amount shall be payable in asingle lump sum on the first payroll date that is at least 60 days following the Termination Date (but, in any event, by no later thanMarch 15 of the calendar year immediately following the calendar year that includes the Termination Date), in accordance withSection 14(b)(ii); provided, however, that notwithstanding the foregoing or any other provision in this Agreement to the contrary, theCompany (or its successor) may unilaterally amend this Section 6(d)(ii) or eliminate the benefit provided hereunder to the extent itdeems necessary to avoid the imposition of excise taxes, penalties or similar charges on the Company or any of its subsidiaries,affiliates or successors, including, without limitation, under Section 4980D of the Code; and(iii) notwithstanding any provision to the contrary in any applicable equity compensation plan or any outstandingequity award agreement, the treatment of the Executive’s outstanding equity awards shall be governed solely by the followingprovisions: (A) all of the Executive’s then-outstanding time-vesting equity awards shall fully vest and all restrictions thereon shalllapse, and (B) to the extent vested (including as a result of the acceleration provided under this Section 6(d)(iii)), all of the Executive’soutstanding stock options shall remain exercisable until the first to occur of 12 months following the Termination Date and each suchstock option’s original expiration date.If a Change of Control is consummated prior to the expiration of the Agreement Term, this Section 6(d) shall apply to atermination of the Executive’s employment by the Company without Cause or by the Executive for Good Reason during the 12-monthperiod immediately following the consummation of the Change of Control even if such 12-month period extends past the expiration ofthe Agreement Term. Moreover, notwithstanding the expiration of the Agreement Term, if a Change of Control is consummatedwithin two months after the expiration of the Agreement Term, then this Section 6(d) shall apply to a termination of the Executive’semployment by the Company without Cause or by the Executive for Good Reason (i) on the day of or during the 12-month periodimmediately following the consummation of the Change of Control or (ii) during the 2-month period prior to the consummation of theChange of Control but at the request of any third party participating in or causing the Change of Control or otherwise in connectionwith the Change of Control.8For the avoidance of doubt, the payments and benefits described under this Section 6(d) and the Accrued Obligations shall bethe only payments and benefits to which the Executive is entitled in the event that the Executive’s employment terminates under thisSection 6(d).(e) Death. In the event of the Executive’s death while employed hereunder, and subject to Section 6(g), the Executive’sbeneficiary (or such other person(s) specified by will or the laws of descent and distribution) shall be entitled to receive a lump-sumpayment in an amount equal to three months’ Base Salary in effect as of the Termination Date (less applicable withholding taxes),which amount shall be payable in a single lump sum on the first payroll date that is at least 60 days following the Termination Date(but, in any event, by no later than March 15 of the calendar year immediately following the calendar year that includes theTermination Date), in accordance with Section 14(b)(ii).(f) Disability. In the event of the Executive’s termination of employment with the Company due to Disability, and subject toSection 6(g), the Executive shall be entitled to receive a lump- sum payment in an amount equal to six months’ Base Salary in effect asof the Termination Date (less applicable withholding taxes), which amount shall be payable in a single lump sum on the first payrolldate that is at least 60 days following the Termination Date (but, in any event, by no later than March 15 of the calendar yearimmediately following the calendar year that includes the Termination Date), in accordance with Section 14(b)(ii).(g) Release and Other Conditions. The payments and benefits described in Sections 6(c) through 6(f) are expresslyconditioned on (i) the Executive (or, in the case of the Executive’s death, the Executive’s representative) signing and delivering (andnot revoking thereafter) a Release to the Company (which, in the case of the Executive’s death, also releases any claims by theExecutive’s estate or survivors), which Release is executed, delivered and effective no later than 60 days following the TerminationDate and (ii) the Executive continuing to satisfy any obligations to the Company under this Agreement, the Release and theConfidentiality and Non-Competition Agreement that are incorporated herein by reference, and any other agreement(s) between theExecutive and the Company. In the event the Release described in Section 6(g)(i) is not executed, delivered and effective by the 60thday after the Termination Date, none of such payments or benefits shall be provided to the Executive.7.Section 280G(a) Amount of Payments and Benefits. Notwithstanding anything to the contrary herein, in the event that the Executivebecomes entitled to receive or receives any payments, options, awards or benefits (including, without limitation, the monetary value ofany noncash benefits and the accelerated vesting of equity-based awards) under this Agreement or under any other plan, agreement orarrangement with the Company or any person affiliated with the Company (collectively, the “Payments”), that may separately or in theaggregate constitute “parachute payments” within the meaning of Section 280G of the Code and the Treasury Regulationspromulgated thereunder (or any similar or successor provision) (collectively, “Section 280G”) and it is determined that, but for thisSection 7(a), any of the Payments will be subject to any excise tax pursuant to Section 4999 of the Code or any similar or successorprovision (the “Excise Tax”), the Company shall pay to the Executive either (i) the full amount of the Payments or (ii) an amount equalto the Payments, reduced9by the minimum amount necessary to prevent any portion of the Payments from being an “excess parachute payment” (within themeaning of Section 280G) (the “Capped Payments”), whichever of the foregoing amounts results in the receipt by the Executive, onan after-tax basis, of the greatest amount of Payments notwithstanding that all or some portion of the Payments may be subject to theExcise Tax. For purposes of determining whether the Executive would receive a greater after-tax benefit from the Capped Paymentsthan from receipt of the full amount of the Payments, (i) there shall be taken into account any Excise Tax and all applicable federal,state and local taxes required to be paid by the Executive in respect of the receipt of such payments and (ii) such payments shall bedeemed to be subject to federal income taxes at the highest rate of federal income taxation applicable to individuals that is in effect forthe calendar year in which the payments and benefits are to be paid, and state and local income taxes at the highest rate of taxationapplicable to individuals in the state and locality of the Executive’s residence on the effective date of the relevant transaction describedunder Section 280G(b)(2)(A)(i) of the Code, net of the maximum reduction in federal income taxes that could be obtained fromdeduction of such state and local taxes (as determined by assuming that such deduction is subject to the maximum limitation applicableto itemized deductions under Section 68 of the Code and any other limitations applicable to the deduction of state and local incometaxes under the Code).(b) Computations and Determinations. All computations and determinations called for by this Section 7 shall be made by anindependent accounting firm or independent tax counsel appointed by the Company (the “Tax Counsel”), and all such computationsand determinations shall be conclusive and binding on the Company and the Executive. For purposes of such calculations anddeterminations, the Tax Counsel may rely on reasonable, good faith interpretations concerning the application of Sections 280G and4999 of the Code. The Tax Counsel shall submit its determination and detailed supporting calculations to both the Executive and theCompany within 15 days after receipt of a notice from either the Company or the Executive that the Executive may receive paymentswhich may be considered “parachute payments.” The Company and the Executive shall furnish to the Tax Counsel such informationand documents as the Tax Counsel may reasonably request in order to make the computations and determinations called for by thisSection 7. The Company shall bear all costs that the Tax Counsel may reasonably incur in connection with the computations anddeterminations called for by this Section 7.(c) Reduction Methodology. In the event that Section 7(a) applies and a reduction is required to be applied to the Paymentsthereunder, the Payments shall be reduced by the Company in its reasonable discretion in the following order: (i) reduction of anyPayments that are subject to Section 409A on a pro-rata basis or such other manner that complies with Section 409A, as determined bythe Company, and (ii) reduction of any Payments that are exempt from Section 409A.8.No Impediment to AgreementThe Executive hereby represents to the Company that the Executive is not, as of the date hereof, and will not be, during theExecutive’s employment with the Company, employed under contract, oral or written, by any other person, firm or entity, and is notand will not be bound by the provisions of any restrictive covenant or confidentiality agreement that would constitute an10impediment to, or restriction upon, the Executive’s ability to enter this Agreement and to perform the duties of the Executive’semployment.9.Confidentiality and Non-Competition AgreementThe Confidentiality and Non-Competition Agreement is incorporated by reference as if set forth fully herein. TheConfidentiality and Non-Competition Agreement shall survive the termination of this Agreement and/or the Executive’s employmentwith the Company.10.CooperationThe Executive hereby agrees to provide the Executive’s full cooperation, at the request of the Company, with any of theCompany Releasees (as defined in the Release) in any and all such lawsuits, investigations or other legal, equitable or business mattersor proceedings which involve any matters for which the Executive worked on or had responsibility during the Executive’s employmentwith the Company. The Executive also agrees to be available to the Company and its representatives (including attorneys) to providegeneral advice or assistance as requested by the Company. This includes but is not limited to testifying (and preparing to testify) as awitness in any proceeding or otherwise providing information or reasonable assistance to the Company in connection with anyinvestigation, claim or suit, and cooperating with the Company regarding any investigation, litigation, claims or other disputed itemsinvolving the Company that relate to matters within the knowledge or responsibility of the Executive. Specifically, the Executiveagrees (i) to meet with the Company’s representatives, its counsel or other designees at reasonable times and places with respect to anyitems within the scope of this provision; (ii) to provide truthful testimony regarding same to any court, agency or other adjudicatorybody; (iii) to provide the Company with immediate notice of contact or subpoena by any non-governmental adverse party (known tothe Executive to be adverse to the Company or its interests); and (iv) to not voluntarily assist any such non-governmental adverse partyor such non-governmental adverse party’s representatives. The Executive acknowledges and understands that the Executive’sobligations of cooperation under this Section 10 are not limited in time and may include, but shall not be limited to, the need for oravailability for testimony. The Executive shall receive no additional compensation for time spent assisting the Company pursuant tothis Section 10 other than the compensation and benefits provided for in this Agreement, provided that the Executive shall be entitledto be reimbursed for any reasonable out-of-pocket expenses incurred in fulfilling the Executive’s obligations pursuant to subsections (i)and (ii) above. Notwithstanding the foregoing, nothing in this Section 10 is intended to interfere with the Executive’s No Interferencerights set forth in Section 1(c) of the Confidentiality and Non-Competition Agreement.11.Arbitration(a) The Executive agrees that any dispute and/or claim between the Company (including without limitation its officers,directors, employees agents or shareholders and its subsidiaries) and the Executive that underlies, relates to and/or results from theExecutive’s employment relationship with the Company or the termination of that relationship or any of the terms of this Agreement,except for any dispute or claim arising from or relating to the Confidentiality and Non-Competition Agreement, that cannot be resolvedby mutual agreement of the Company and the Executive will11be submitted to final, binding arbitration to the maximum extent permitted by law in accordance with the National Rules for theResolution of Employment Disputes of the American Arbitration Association that are then in effect. This arbitration provision includes,but is not limited to, claims of wrongful discharge, infliction of emotional distress, breach of contract (including breach of thisAgreement), breach of any covenant of good faith and fair dealing, and claims of retaliation and/or discrimination in violation of anylocal, state or federal law. Examples of such laws include Title VII of the Civil Rights Act of 1964; the Age Discrimination inEmployment Act of 1967; the Americans with Disabilities Act of 1990; and the Family and Medical Leave Act of 1993, and allamendments to each such law as well as the regulations issued thereunder. This arbitration provision does not affect the Executive’sright to pursue worker’s compensation or unemployment compensation benefits for which he may be eligible in accordance with statelaw, nor does it affect the Executive’s right to file and/or to cooperate in the investigation of an administrative charge of discrimination.(b) Notwithstanding this arbitration provision, either the Executive or the Company may apply to any court of competentjurisdiction for a temporary restraining order, preliminary injunction, or other interim or conservatory relief, as necessary, withoutbreach of this Agreement and without abridgement of the powers of the arbitrator.(c) This arbitration provision does not apply to any dispute or claim arising from or relating to the Confidentiality and Non-Competition Agreement.(d) The Company, as further consideration for the Executive’s agreement to arbitrate covered disputes, agrees to pay for thearbitrator’s fees and other costs directly associated with the arbitration that would not otherwise be charged if the parties pursued civillitigation in court.12.Successors; Personal ServicesThe services and duties to be performed by the Executive hereunder are personal and may not be assigned or delegated. ThisAgreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and the Executive and theExecutive’s heirs and representatives.13.NoticesNotices and all other communications contemplated by this Agreement shall be in writing and shall be deemed to have beenduly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid.In the case of the Executive, mailed notices shall be addressed to the Executive at the home address the Executive most recentlycommunicated to the Company in writing. In the case of the Company, mailed notices shall be addressed to its corporate headquarters,and all notices shall be directed to the attention of its President and Chief Executive Officer.1214.Section 409A(a) The parties intend that this Agreement and the payments and benefits provided hereunder be exempt from the requirementsof Section 409A, to the maximum extent possible, whether pursuant to the short-term deferral exception described in TreasuryRegulation Section 1.409A-1(b)(4), the involuntary separation pay plan exception described in Treasury Regulation Section 1.409A-1(b)(9)(iii), or otherwise. To the extent Section 409A is applicable to this Agreement, the parties intend that this Agreement and anypayments and benefits thereunder comply with the deferral, payout and other limitations and restrictions imposed under Section 409A.Notwithstanding anything herein to the contrary, this Agreement shall be interpreted, operated and administered in a manner consistentwith such intentions.(b) Without limiting the generality of the foregoing, and notwithstanding any other provision of this Agreement to thecontrary:(i) if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that termunder Section 409A, then with regard to any payment that is considered a “deferral of compensation” under Section 409A payable onaccount of a “separation from service,” such payment shall be made on the date which is the earlier of (A) the date that is six monthsand one day after the date of such “separation from service” of the Executive and (B) the date of the Executive’s death (the “DelayPeriod”), to the extent required under Section 409A. Within ten business days following the expiration of the Delay Period, allpayments delayed pursuant to this Section 14(b)(i) (whether they would have otherwise been payable in a single sum or in installmentsin the absence of such delay) shall be paid to the Executive in a lump sum, and all remaining payments due under this Agreement shallbe paid or provided in accordance with the normal payment dates specified for those payments in this Agreement;(ii) to the extent that any payments or benefits under this Agreement are conditioned on a Release, if the Release isexecuted and delivered by the Executive to the Company and becomes irrevocable and effective within the specified 60-day post-termination period, then, subject to Section 14(b)(i) and to the extent not exempt under Section 409A, such payments or benefits shallbe made or commence on the first payroll date after the date that is 60 days after the Termination Date (but, in any event, by no laterthan March 15 of the calendar year immediately following the calendar year that includes the Termination Date). If a payment orbenefit under this Agreement is conditioned on a Release and such Release is not executed, delivered and effective by the 60th dayafter the Termination Date, such payment or benefit shall not be paid or provided to the Executive;(iii) all expenses or other reimbursements under this Agreement shall be made on or prior to the last day of the taxableyear following the taxable year in which such expenses were incurred by the Executive. No such reimbursement or expenses eligiblefor reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year, and theExecutive’s right to reimbursement shall not be subject to liquidation or exchange for any other benefit;13(iv) for purposes of Section 409A, the Executive’s right to receive a series of installment payments pursuant to thisAgreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreementspecifies a payment period with reference to a number of days (e.g., “payment shall be made within 30 days”), the actual date ofpayment within the specified period shall be within the sole discretion of the Company;(v) in no event shall any payment under this Agreement that constitutes a “deferral of compensation” for purposes ofSection 409A be offset by any other payment pursuant to this Agreement or otherwise; and(vi) to the extent required for purposes of compliance with Section 409A, termination of employment shall not bedeemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits uponor following a termination of employment unless such termination is also a “separation from service” within the meaning of Section409A, and for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or liketerms shall mean “separation from service.”(c) The Company and the Executive agree to work together in good faith to consider amendments to this Agreement and totake such reasonable actions that may be necessary, appropriate, or desirable to avoid imposition of additional tax or incomerecognition on the Executive under Section 409A, in each case to the maximum extent permitted by applicable law. Notwithstandingany provision of this Agreement to the contrary, (i) in no event will the Company be liable for any additional tax, interest or penaltythat may be imposed on the Executive by Section 409A or damages for failing to comply with Section 409A and (ii) the Executiveacknowledges and agrees that the Executive will not have any claim or right of action against the Company or any of its employees,officers, directors or agents in the event it is determined that any payment or benefit provided hereunder does not comply with Section409A.15.Miscellaneous Provisions(a) Waiver. No provision of this Agreement shall be modified, waived or discharged unless the modification, waiver ordischarge is agreed to in writing and signed by the Executive and by an authorized officer of the Company (other than the Executive).No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other partyshall be considered a waiver of any other condition or provision or of the same condition or provision at another time.(b) Entire Agreement. This Agreement (including exhibits) shall supersede and replace all prior agreements or understandingsrelating to the subject matter hereof, and no agreements, representations or understandings (whether oral or written or whether expressor implied) that are not expressly set forth in this Agreement have been made or entered into by either party with respect to the relevantmatters hereof. This Agreement may not be modified except expressly in a writing signed by both parties.(c) Disclaimer of Reliance. Except for the specific representations expressly made by the Company in this Agreement, theExecutive specifically disclaims that the Executive is relying14upon or has relied upon any communications, promises, statements, inducements, or representation(s) that may have been made, oral orwritten, regarding the subject matter of this Agreement. The Executive represents that the Executive relied solely and only on theExecutive’s own judgment in making the decision to enter into this Agreement.(d) Choice of Law. The validity, interpretation, construction and performance of this Agreement shall be governed by theinternal substantive laws of the State of Texas without reference to any choice of law rules.(e) Severability. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect thevalidity or enforceability of any other provision hereof, which shall remain in full force and effect.(f) No Assignment of Benefits. The rights of any person to payments or benefits under this Agreement shall not be madesubject to option or assignment, either by voluntary or involuntary assignment or by operation of law, in respect of bankruptcy,garnishment, attachment or other creditor’s process, and any action in violation of this Section 15(f) shall be void.(g) No Duty to Mitigate. The Executive shall not be required to mitigate the amount of any payment contemplated by thisAgreement, nor shall any such payment be reduced by any earnings that the Executive may receive from any other source.(h) Employment Taxes. All payments made pursuant to this Agreement will be subject to withholding of all applicableincome, employment and other taxes.(i) Assignment by Company. The Company may assign its rights under this Agreement to an affiliate (as defined under theExchange Act), and an affiliate may assign its rights under this Agreement to another affiliate of the Company or to the Company. Inthe case of any such assignment, the term “Company” when used in a section of this Agreement shall mean the corporation thatactually employs the Executive.(j) Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all ofwhich together will constitute one and the same instrument.[Signature Page Follows]15IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorizedofficer, as of the day and year first above written.BLUCORA, INC. By: /s/ John S. Clendening Name: John S. ClendeningTitle: President and Chief Executive Officer EXECUTIVE: /s/ Curtis CampbellCurtis Campbell16EXHIBIT ACONFIDENTIALITY AND NON-COMPETITION AGREEMENTThis Confidentiality and Non-Competition (“Agreement”) is entered into by and between Blucora, Inc., its subsidiaries,affiliates, successors and/or assigns (the “Company”) and Curtis Campbell (“Executive”). The Effective Date of this Agreement is thedate of Executive’s execution of this Agreement. The Company and Executive shall be referred to herein individually as a “Party” andcollectively as the “Parties.”NOW, THEREFORE, in consideration of the mutual covenants set forth herein, Executive’s position with the Company, theConfidential Information (defined below), compensation and benefits provided to Executive, and other good and valuableconsideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the Partiesagree as follows:1.Confidential Information and Executive’s Non-Disclosure Agreement.(a) Confidential Information. During Executive’s employment with the Company, the Company shall provide Executive withConfidential Information (defined below), which is not known to the Company’s competitors or within the Company’s industrygenerally, which was developed by the Company over a long period of time and/or at its substantial expense, and which is of greatcompetitive value to the Company. For purposes of this Agreement, “Confidential Information” includes all documents orinformation, in whatever form or medium, concerning or relating to any of the following: all trade secrets and confidential andproprietary information of or relating to the Company, including, but not limited to: (A) financial models, business records, businessplans or processes, strategies (including, without limitation, economic and market research selection and analysis strategies andbusiness development and market segment exploitation strategies), tactics, policies, resolutions, processes, inventions, patents,trademarks, trade secrets, know how, patent or trademark applications and other intellectual property, (B) information regardinglitigation or negotiations, (C) any marketing information, sales or product plans, prospects and market research data relating to thebusiness, (D) financial information, cost and performance data and any debt arrangements, equity ownership or securities transactioninformation, (E) technical information, technical drawings and designs, (F) personnel information, personnel lists, resumes, personneldata, organizational structure, compensation and performance evaluations, (G) customer, consumer, consultants or supplierinformation, including but not limited to any data regarding any current, prospective or former customers, consumers, consultants orsuppliers of Company, (H) information regarding the existence or terms of any agreement or relationship between the Company or anyof its subsidiaries or affiliates and any other party, (I) information subject to Section 628 of the Fair Credit Reporting Act and anyregulations or guidelines thereunder and (J) any other information of whatever nature, including, without limitation, information whichgives to the Company or any of its subsidiaries or affiliates an opportunity to obtain an advantage over its competitors who or which donot have access to such information. Confidential Information, whether prepared or compiled by Executive and/or the Company orfurnished to Executive during Executive’s employment with the Company, shall be the sole and exclusive property of the Company,and none of such Confidential Information or copies thereof, shall be retained by Executive.CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 1Executive agrees not to dispute, contest, or deny any such ownership rights either during or after Executive’s employment with theCompany. Executive acknowledges that the Company does not voluntarily disclose Confidential Information, but rather takesprecautions to prevent dissemination of Confidential Information beyond those employees such as Executive entrusted with suchinformation. Executive further acknowledges that the Confidential Information: (a) is entrusted to Executive because of Executive’sposition with the Company; and (b) is of such value and nature as to make it reasonable and necessary for Executive to protect andpreserve the confidentiality and secrecy of the Confidential Information. Executive acknowledges and agrees that the ConfidentialInformation is proprietary to and a trade secret of the Company and, as such, is a valuable, special and unique asset of the Company,the unauthorized use or disclosure of which will cause irreparable harm, substantial injury and loss of profits and goodwill to theCompany. “Confidential Information” does not include any information which is generally available to and known by the public orbecomes generally available to and known by the public (other than as a result of Executive’s breach of this Agreement or any otheragreement or obligation to keep such information confidential).(b) Non-Disclosure.(i) Executive agrees to preserve and protect the confidentiality of all Confidential Information. Executive agrees thatduring the period of Executive’s employment with the Company and at any time thereafter (regardless of the reason for Executive’sseparation or termination of employment): (A) Executive shall hold all Confidential Information in the strictest confidence, take allreasonable precautions and steps to safeguard all Confidential Information and prevent its wrongful use by or wrongful or inadvertentdisclosure or dissemination to any unauthorized person or entity, and follow all policies and procedures of the Company protecting orregarding the Confidential Information; and (B) without prior written authorization of the Company, Executive shall not, directly orindirectly, use for Executive’s own account, use in any way or for any other purpose, disclose to anyone, publish, exploit, destroy,copy or remove from the offices of the Company, nor solicit, allow or assist another person or entity to use, disclose, publish, exploit,destroy, copy or remove from the offices of the Company, any Confidential Information or part thereof, except: (1) as permitted in theproper performance of Executive’s duties for the Company; (2) as permitted in the ordinary course of the Company’s business for thebenefit of the Company; or (3) as otherwise permitted or required by law. Executive shall immediately notify the Company ifExecutive learns of or suspects any actual or potential unauthorized use or disclosure of Confidential Information concerning theCompany. Further, the Executive shall not, directly or indirectly, use the Company’s Confidential Information to: (1) call upon, solicitbusiness from, attempt to conduct business with, conduct business with, interfere with or divert business away from any customer,client, service provider, supplier or vendor of the Company with whom or which the Company conducted business; and/or (2) recruit,solicit, hire or attempt to recruit, solicit, or hire, directly or by assisting others, any persons employed by the Company. In the eventExecutive is subpoenaed, served with any legal process or notice, or otherwise requested to produce or divulge, directly or indirectly,any Confidential Information by any entity, agency or person in any formal or informal proceeding including, but not limited to, anyinterview, deposition, administrative or judicial hearing and/or trial, except where prohibited by law, Executive should immediatelynotify the Company and deliver a copy of the subpoena, process, notice or other request to the CompanyCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 2as promptly as possible, but under no circumstances more than ten (10) days following Executive’s receipt of same; provided,however, Executive is not required to notify the Company or provide a copy of the subpoena, process, notice or other request whereExecutive is permitted to make such disclosure of Confidential Information pursuant to this Agreement or applicable law or regulation,as set forth in Section 1(c) and Section 1(d).(ii) Subject to Section 1(b)(iii), Executive agrees that Executive will not use or disclose any confidential, proprietary ortrade secret information belonging to any former employer or third party, and Executive will not bring onto the premises of theCompany or onto any Company property, any confidential, proprietary or trade secret information belonging to any former employeror third party without such third party’s written consent. Executive acknowledges that that the Company has specifically instructedExecutive not to disclose to the Company, use, or induce the Company to use, any confidential, proprietary or trade secret informationbelonging to any previous employer or others.(iii) During Executive’s employment, the Company will receive from third parties their confidential and/or proprietaryinformation, subject to a duty on the Company’s part to maintain the confidentiality of and to use such information only for certainlimited purposes. Executive agrees to hold all such confidential or proprietary information in the strictest confidence and not to discloseit to any person or organization or to use it except as necessary in the course of Executive’s employment with the Company and inaccordance with the Company’s agreement with such third party.(iv) Except in the proper performance of Executive’s duties and responsibilities, Executive agrees that Executive shallnot remove, destroy, deface, damage or delete any Property of the Company. For purposes of this Agreement, the term “Property”means all property or information, in whatever form or media, and all copies thereof whether or not the original was deleted ordestroyed, of the Company, including, without limitation, any Confidential Information, software, hardware, including any and allCompany-issued equipment, devices, cellular telephones, tablets, computers, laptops, hard drives, keys, access cards, access codes orpasswords belonging to the Company, databases, files, records, reports, memoranda, research, plans, proposals, lists, forms, drawings,specifications, notebooks, manuals, correspondence, materials, e-mail, electronic or magnetic recordings or data, and any other physicalor electronic documents that Executive receives from or sends to any employee of the Company, that Executive copies from the files orrecords of the Company, or that Executive otherwise has access to during Executive’s employment.(c) No Interference. Notwithstanding any other provision of this Agreement, (i) Executive may disclose ConfidentialInformation when required to do so by a court of competent jurisdiction, by any governmental agency having authority over Executiveor the business of the Company or by any administrative body or legislative body (including a committee thereof) with jurisdiction toorder Executive to divulge, disclose or make accessible such information; and (ii) nothing in this Agreement is intended to interferewith Executive’s right to (A) report possible violations of state or federal law or regulation to any governmental or law enforcementagency or entity; (B) make other disclosures that are protected under the whistleblower provisions of state or federal law or regulation;(C) file a claim or charge with any governmental agency or entity; or (D)CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 3testify, assist, or participate in an investigation, hearing, or proceeding conducted by any governmental or law enforcement agency orentity, or any court. For purposes of clarity, in making or initiating any such reports or disclosures or engaging in any of the conductoutlined in subsection (ii) above, Executive may disclose Confidential Information to the extent necessary to such governmental or lawenforcement agency or entity or such court, need not seek prior authorization from the Company, and is not required to notify theCompany of any such reports, disclosures or conduct.(d) Defend Trade Secrets Act. Executive is hereby notified in accordance with the Defend Trade Secrets Act of 2016 thatExecutive will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret thatis made in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney solely for thepurpose of reporting or investigating a suspected violation of law, or is made in a complaint or other document that is filed under seal ina lawsuit or other proceeding.(e) Inventions.(i) Prior Inventions Retained and Licensed. In Exhibit A-1 to this Agreement, Executive has provided a list describingall Inventions (defined below) that Executive: (A) conceived, created, developed, made, reduced to practice or completed, either aloneor with others, prior to Executive’s employment with the Company; (B) claims a proprietary right or interest in; and (C) does not assignto the Company hereunder (collectively referred to as the “Prior Inventions”). If no such list is attached, Executive represents thatthere are no such Prior Inventions. Executive understands and agrees that the Company makes no attempt to verify Executive’s claimof ownership to any of the Prior Inventions. Executive agrees that Executive shall not incorporate in any work that Executive performsfor the Company any Prior Inventions or any of the technology described in any Prior Inventions. Nonetheless, if in the course ofExecutive’s employment with the Company, Executive incorporates Prior Inventions into a product, service, process or machine of theCompany, Executive hereby grants and shall be deemed to have granted the Company a nonexclusive, royalty-free, irrevocable,sublicensable, transferable, perpetual, and worldwide license to make, have made, modify, use, import, reproduce, distribute, prepareand have prepared derivative works of, offer to sell, sell and otherwise exploit such Prior Inventions. For purposes of this Agreement,the term “Inventions” means all tangible and intangible materials, work product, information, methods, designs, computer programs,software, databases, formulas, models, prototypes, reports, discoveries, ideas, improvements, know-how, compositions of matter,processes, photographs, drawings, illustrations, sketches, developments, and all related intellectual property, including inventions,original works of authorship, moral rights, mask works, trade secrets and trademarks.(ii) Assignment of Inventions. During Executive’s employment with the Company and following the termination ofExecutive’s employment for any reason, Executive agrees that Executive shall promptly make full written disclosure to the Company,shall hold in trust for the sole right and benefit of the Company, and hereby assigns and shall be deemed to have assigned to theCompany or its designee, all of Executive’s right, title, and interest in and to any and all Inventions that have been or may beconceived, created, developed, completed, reduced toCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 4practice or otherwise made by Executive, solely or jointly with others, during the period of Executive’s employment with the Companywhich (A) relate in any manner to the existing or contemplated business, work, or investigations of the Company; (B) are suggestedby, result from, or arise out of any work that Executive may do for or on behalf of the Company; (C) result from or arise out of anyConfidential Information that may have been disclosed or otherwise made available to Executive as a result of duties assigned toExecutive by the Company; or (D) are otherwise made through the use of the time, information, equipment, facilities, supplies ormaterials of the Company, even if developed, conceived, reduced to practice or otherwise made during other than working hours(collectively referred to as “Company Inventions”). Executive further acknowledges that all original works of authorship that are madeby Executive (solely or jointly with others) within the scope of Executive’s employment with the Company and that are protectable bycopyright are “Works Made for Hire,” as that term is defined in the United States Copyright Act. Executive understands and agreesthat the decision whether or not to commercialize or market any Company Inventions is within the Company’s sole discretion and forthe Company’s sole benefit, and that no royalty will be due to Executive as a result of the Company’s efforts to commercialize ormarket any such Company Invention.(iii) Maintenance of Records. Executive agrees to keep and maintain adequate and current hard-copy and electronicrecords of all Company Inventions. The records will be available to and remain the sole property of the Company during Executive’semployment with the Company and at all times thereafter.(f) Patent and Copyright Registrations. Executive agrees to assist the Company or its designee, at the Company’s expense, inevery proper way to secure the Company’s rights in Company Inventions in any and all countries, including the disclosure to theCompany of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments,affidavits, and all other instruments which the Company shall deem necessary in order to apply for and obtain such rights and in orderto assign and convey to the Company and/or its successors, assigns and nominees, the sole and exclusive rights, title and interest in andto such Company Inventions. Executive further agrees that Executive’s obligation to execute or cause to be executed, when it is inExecutive’s power to do so, any such instrument or papers shall continue after the termination of this Agreement. Executive herebyappoints the General Counsel of the Company as Executive’s attorney-in-fact to execute documents on Executive’s behalf for thispurpose. Executive agrees that this appointment is coupled with an interest and will not be revocable.(g) Return of Company Property. Upon request by the Company or upon the termination of Executive’s employment for anyreason, Executive shall immediately return and deliver to the Company any and all Property, including, without limitation, ConfidentialInformation, software, hardware, including any and all Company-issued equipment, devices, cellular telephones, tablets, computers,laptops, hard drives, keys, access cards, access codes or passwords, databases, files, documents, records, reports, memoranda, research,plans, proposals, lists, papers, books, forms, drawings, specifications, notebooks, manuals, correspondence, materials, e-mail,electronic or magnetic recordings or data, including all copies thereof (in electronic or hard copy format), which belong to theCompany or which relate to the Company’s business and which are in Executive’s possession, custody or control, whether preparedby Executive or others. Executive further agreesCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 5that after Executive provides such Property to the Company, Executive will immediately destroy any information or documents,whether prepared by Executive or others, containing or reflecting any Confidential Information or relating to the business of theCompany from any computer, cellular phone or other digital or electronic device in Executive’s possession, custody or control, andExecutive shall certify such destruction in writing to the Company. Upon request by the Company, Executive shall provide suchcomputer, cellular phone or other digital or electronic device to the Company or the Company’s designee for inspection to confirm thatsuch information and documents have been destroyed. If at any time after the termination of Executive’s employment for any reason,Executive or the Company determines that Executive has any Property in Executive’s possession, custody or control, Executive shallimmediately return all such Property, including all copies and portions thereof, to the Company.2. Restrictive Covenants. In consideration for (i) the Company’s promise to provide Confidential Information; (ii) thesubstantial economic investment made by the Company in the Confidential Information and goodwill of the Company, and/or thebusiness opportunities disclosed or entrusted to Executive; (iii) access to the customers and clients of the Company; and (iv) theCompany’s employment of Executive in an executive position and the compensation and other benefits provided by the Company toExecutive (including the consideration provided for in the Incentive Retention Letter), to protect the Confidential Information andbusiness goodwill of the Company, Executive agrees to the following restrictive covenants.(a) Non-Competition. Executive agrees that during the Executive’s employment with the Company and for a period of twelve(12) months after the Executive’s employment terminates for any reason (the “Restricted Period”), other than in connection withExecutive’s performance of his duties for the Company, Executive shall not, and shall not use any Confidential Information to, withoutthe prior written consent of an officer of the Company, directly or indirectly, either individually or as a principal, partner, stockholder,manager, agent, consultant, contractor, distributor, employee, lender, investor, or as a director or officer of any corporation orassociation, or in any other manner or capacity whatsoever, (i) control, manage, operate, establish, take steps to establish, lend moneyto, invest in, solicit investors for, or otherwise provide capital to, or (ii) become employed by, join, perform services for, consult for, dobusiness with or otherwise engage in any Competing Business within the Restricted Area. For purposes of this Consulting Agreement,given the scope of Confidential Information to be provided to Executive and job duties to be performed by the Executive, “RestrictedArea” means the United States, and any other geographic area for which Executive performed any services or about which Executivereceived Confidential Information. For purposes of this Agreement, “Competing Business” means any business, individual,partnership, firm, corporation or other entity that is competing or that is preparing to compete with any aspect of the Company’sbusiness, which includes, but is not limited to (a) tax preparation and tax preparation-related products and services provided toconsumers and small businesses, and to or through tax professionals; (b) investment and insurance products or services, and relatedadvice and brokerage services, provided to or through tax professionals or in conjunction with tax preparation services, and (c) anyother business the Company engages in or develops during the Executive’s employment with the Company.CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 6(b) Non-Solicitation. During the Restricted Period, other than in connection with Executive’s duties for the Company,Executive shall not, and shall not use any Confidential Information to, directly or indirectly, either as a principal, manager, agent,employee, consultant, officer, director, stockholder, partner, investor or lender or in any other capacity, and whether personally orthrough other persons, solicit business from, interfere with, or induce to curtail or cancel any business or contracts with the Company,or attempt to solicit business with, interfere with, or induce to curtail or cancel any business or contracts with the Company, or dobusiness with any actual or prospective customer or client of the Company with whom the Company did business or who theCompany solicited within the preceding two (2) years, and who or which: (1) Executive contacted, called on, serviced or did businesswith during Executive’s employment with the Company; (2) Executive learned of as a result of Executive’s employment with theCompany; or (3) about whom Executive received Confidential Information. This restriction applies only to business which is in thescope of services or products provided by the Company.(c) Non-Recruitment. During the Restricted Period, other than in connection with Executive’s duties for the Company,Executive shall not, on behalf of Executive or on behalf of any other person or entity, directly or indirectly, hire, solicit or recruit, orattempt to hire, solicit or recruit, or encourage to leave or otherwise cease his/her employment or engagement with the Company, anyindividual who is an employee or independent contractor of the Company or who was an employee or independent contractor of theCompany within the twelve (12) month period prior to Executive’s separation from employment with the Company.(d) Non-Disparagement. Executive agrees that the Company’s goodwill and reputation are assets of great value to theCompany, which have been obtained and maintained through great costs, time and effort. Therefore, Executive agrees that duringExecutive’s employment and after the termination of Executive’s employment, Executive shall not make, publish or otherwise transmitany knowingly false statements, whether written or oral, regarding the Company and its officers, directors, executives, employees,contractors, consultants, products, services, business or business practices. A violation or threatened violation of this Section 2(d) maybe enjoined by the courts. The rights afforded the Company under this provision are in addition to any and all rights and remediesotherwise afforded by law. However, nothing in this Section 2(d) restricts or prevents Executive from providing truthful testimony asrequired by court order or other legal process or is intended to interfere with Executive’s rights set forth in Section 1(c).(e) Tolling. If Executive violates any of the covenants contained in this Section 2, the Restricted Period applicable to suchcovenant(s) shall be suspended and shall not run in favor of Executive from the time of the commencement of such violation until thetime that Executive cures the violation to the satisfaction of the Company and the period of time in which Executive is in breach shallbe added to the Restricted Period applicable to such covenant(s).3. Reasonableness. Executive hereby represents to the Company that Executive has read and understands, and agrees to bebound by, the terms of Section 1 and Section 2. Executive acknowledges that the scope and duration of the restrictions and covenantscontained in Section 1 and Section 2 are fair and reasonable in light of (i) the nature and scope of the operations of the Company’sbusiness; and (ii) the amount of compensation and Confidential Information (including,CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 7without limitation, trade secrets) that Executive is receiving in connection with Executive’s employment with the Company and theIncentive Retention Letter. It is the desire and intent of the Parties that the provisions of Section 1 and Section 2 be enforced to thefullest extent permitted under applicable law, whether now or hereafter in effect and therefore, to the extent permitted by applicablelaw, Executive and the Company hereby waive any provision of applicable law that would render any provision of Section 1 and/orSection 2 invalid or unenforceable.4. Remedies. Executive acknowledges that the restrictions and covenants contained in Section 1 and Section 2, in view of thenature of the Company’s business and Executive’s position with the Company, are reasonable and necessary to protect the Company’slegitimate business interests, goodwill and reputation, and that any violation of Section 1 or Section 2 would result in irreparable injuryand continuing damage to the Company, and that money damages would not be a sufficient remedy to the Company for any suchbreach or threatened breach. Therefore, Executive agrees that the Company shall be entitled to a temporary restraining order andinjunctive relief restraining Executive from the commission of any breach or threatened breach of Section 1 and/or Section 2, withoutthe necessity of establishing irreparable harm or the posting of a bond, and to recover from Executive damages incurred by theCompany as a result of the breach, as well as the Company’s attorneys’ fees, costs and expenses related to any breach or threatenedbreach of this Agreement and enforcement of this Agreement. Nothing contained in this Agreement shall be construed as prohibitingthe Company from pursuing any other remedies available to it for any breach or threatened breach, including, without limitation, therecovery of money damages, attorneys’ fees, and costs. The existence of any claim or cause of action by Executive against theCompany, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of therestrictions or covenants contained in Section 1 or Section 2, or preclude injunctive relief.5. Business Opportunities. Executive, without further compensation, assigns and agrees to assign to the Company and itssuccessors, assigns or designees, all of Executive’s right, title and interest in and to all Business Opportunities (defined below), andfurther acknowledges and agrees that all Business Opportunities constitute the exclusive property of the Company. Executive shallpresent all Business Opportunities to the Company, and shall not exploit a Business Opportunity. For purposes of this Agreement,“Business Opportunities” means all business ideas, prospects, or proposals pertaining to any aspect of the Company’s business andany business the Company prepared to conduct or contemplated conducting during Executive’s employment with the Company, whichare developed by Executive or originated by any third party and brought to the attention of Executive, together with informationrelating thereto. For the avoidance of doubt, this Section 5 is not intended to limit or narrow Executive’s duties or obligations underfederal or state law with respect to corporate opportunities.6. Conflicting Activities. Executive agrees that, during Executive’s employment with the Company, Executive shall notengage in any employment, consulting relationship, business or other activity that (i) is in any way competitive with the business orproposed business of the Company (except that Executive may invest less than one percent (1%) of the shares of a company traded ona registered stock exchange); (ii) conflicts with Executive’s duty of loyalty, responsibilities or obligations to the Company or interfereswith the independent exercise of Executive’s judgmentCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 8in the Company’s best interests; or (iii) adversely affects the performance of Executive’s job duties and responsibilities with theCompany. Executive agrees to not assist any other person or organization in competing with the Company or in preparing to engage incompetition with the Company or proposed business of the Company. Executive further agrees that, during Executive’s employmentwith the Company, Executive shall not actively engage in any other employment, occupation or consulting activity for any direct orindirect remuneration without the prior approval of Executive’s direct supervisor or the Company’s Legal Department. Executive haslisted on the Company’s Outside Activity Disclosure form, attached hereto as Exhibit B-1, any business activities or ventures withwhich Executive is involved. If no such list is attached, Executive represents that there are no such outside activities as of the date ofthis Agreement.7. Breach Executive acknowledges that Executive is subject to immediate dismissal by the Company for any breach of thisAgreement and that such a dismissal will not relieve Executive from any continuing obligations under this Agreement or from theimposition by a court of any judicial remedies, including, without limitation, money damages and/or injunctive relief for such breach.8. Notice. If Executive, in the future, seeks or is offered employment, or any other position or capacity with another company,entity or person, Executive agrees to inform each such company, entity or person of the existence of the restrictions in Section 1 andSection 2. The Company shall be entitled to advise such company, entity or person and third parties of the provisions of Section 1 andSection 2 and to otherwise deal with such company, entity, person or third party to ensure that the provisions of Section 1 and Section2 are enforced and duly discharged.9. Reformation. The Company and Executive agree that in the event any of the terms, provisions, covenants or restrictionscontained in this Agreement, or any part thereof, shall be held by any court of competent jurisdiction to be effective in any particulararea or jurisdiction only if said term, provision, covenant or restriction is modified to limit its duration or scope, then the court shallhave such authority to so reform the term, provision, covenant or restriction and the Parties hereto shall consider such term, provision,covenant or restriction to be amended and modified with respect to that particular area or jurisdiction so as to comply with the order ofany such court and, as to all other jurisdictions, the term, provision, covenant or restriction contained herein shall remain in full forceand effect as originally written. By agreeing to this contractual modification prospectively at this time, the Company and Executiveintend to make Section 1 and Section 2 enforceable under the law or laws of all applicable jurisdictions so that the restrictive covenantsin their entirety and this Agreement as prospectively modified shall remain in full force and effect and shall not be rendered void orillegal.10. Severability. In the event any court of competent jurisdiction or any foreign, federal, state, county or local government orany other governmental regulatory or administrative agency or authority holds any provision of this Agreement to be invalid, illegal orunenforceable, such invalid, illegal or unenforceable portion(s) shall be limited or excluded from this Agreement to the minimum extentrequired, and the remaining provisions shall not be affected or invalidated and shall remain in full force and effect.CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 911. Binding Effect of Agreement and Assignment. This Agreement shall be binding upon and inure to the benefit of theParties hereto and their respective heirs, successors, legal representatives and permitted assigns. Executive may not assign thisAgreement to a third party. The Company may assign its rights, together with its obligations hereunder, to any affiliate and/orsubsidiary of the Company or any successor thereto or any purchaser of substantially all of the assets of the Company, withoutExecutive’s consent and without advance notice.12. Survival. Executive agrees that Executive’s obligations under this Agreement shall continue in effect after the terminationof Executive’s employment, regardless of the reason(s) for termination, and whether such termination is voluntary or involuntary.13. Waiver. The failure of either Party to insist in any one or more instances upon performance of any terms or conditions ofthis Agreement shall not be construed as a waiver of future performance of any such term, covenant or condition, but the obligations ofeither Party with respect thereto shall continue in full force and effect. No waiver of any breach of this Agreement shall be construed tobe a waiver as to succeeding breaches and no waiver of any provisions of this Agreement shall constitute a waiver of any otherprovision of this Agreement. The breach by one Party to this Agreement shall not preclude equitable relief, injunctive relief or theobligations in Section 1 or Section 2.14. Controlling Law. This Agreement shall be governed by and construed under the laws of the State of Texas, withoutregard to any applicable conflict of law or choice of law rules.15. Venue. Venue of any dispute arising out of, in connection with or in any way related to this Agreement shall be in a statedistrict court of competent jurisdiction in Dallas County, Texas, or the United States District Court for the Northern District of Texas.Executive consents to personal jurisdiction of the state district courts of Dallas County, Texas and to the United States District Courtfor the Northern District of Texas for any dispute arising out of, in connection with or in any way related to this Agreement, and agreesthat Executive shall not challenge personal jurisdiction in such courts. Executive waives any objection that Executive may now orhereafter have to the venue or jurisdiction of any proceeding in such courts or that any such proceeding was brought in an inconvenientforum (and agrees not to plead or claim the same).16. WAIVER OF JURY TRIAL. WITH RESPECT TO ANY DISPUTE BETWEEN EXECUTIVE AND THECOMPANY ARISING OUT OF, IN CONNECTION WITH OR IN ANY WAY RELATED TO THIS AGREEMENT,EMPLOYEE AGREES TO RESOLVE SUCH DISPUTE(S) BEFORE A JUDGE WITHOUT A JURY. EMPLOYEE HASKNOWLEDGE OF THIS PROVISION, AND WILL PROVIDE SERVICES TO THE COMPANY THEREAFTER, HEREBYWAIVING EXECUTIVE’S RIGHT TO TRIAL BY JURY AND AGREES TO HAVE ANY DISPUTE(S) ARISINGBETWEEN THE COMPANY AND EXECUTIVE ARISING OUT OF, IN CONNECTION WITH OR IN ANY WAYRELATED TO THIS AGREEMENT RESOLVED BY A JUDGE OF A COMPETENT COURT IN DALLAS COUNTY,TEXAS, SITTING WITHOUT A JURY.17. Entire Agreement. This Agreement constitutes the entire agreement between the Parties with respect to the subject matterhereof, and fully supersedes any and all prior andCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 10contemporaneous agreements, understandings and/or representations between the Parties, whether oral or written, pertaining to thesubject matter of this Agreement; provided, however, Executive’s obligations under this Agreement are in addition to Executive’sobligations under any applicable law or regulation and the Company’s policies and procedures. No oral statements or prior writtenmaterial not specifically incorporated in this Agreement shall be of any force and effect, and no changes in or additions to thisAgreement shall be recognized, unless incorporated in this Agreement by written amendment, such amendment to become effective onthe date stipulated in it. Any amendment to this Agreement must be signed by all parties to this Agreement.18. Disclaimer of Reliance. Except for the specific representations expressly made by the Company in this Agreement,Executive specifically disclaims that Executive is relying upon or has relied upon any communications, promises, statements,inducements, or representation(s) that may have been made, oral or written, regarding the subject matter of this Agreement. Executiverepresents that Executive relied solely and only on Executive’s own judgment in making the decision to enter into this Agreement.19. Voluntary Agreement. Executive (i) acknowledges that Executive has read and understands the terms of this Agreementand believes them to be reasonable, (ii) agrees that the consideration provided by the Company for this Agreement is reasonable, and(iii) is voluntarily executing this Agreement as signified by Executive’s signature hereto,.20. Execution in Multiple Counterparts. This Agreement may be executed in multiple counterparts, whether or not allsignatories appear on these counterparts, and each counterpart shall be deemed an original for all purposes.[Signature Page Follows]CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 11The signatures below indicate that the Parties have read, understand and will comply with this Agreement. EXECUTIVE:Signature: ______________________ Printed Name: Curtis Campbell Date: ______________________ THE COMPANY:Blucora, Inc.: Signature: ______________________ Name: ______________________ Title: ______________________ Date: ______________________ CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 12EXHIBIT A-1 LIST OF PRIOR INVENTIONSTitleDateIdentifying Number or Brief Description ____ No Inventions____ Additional Sheets Attached Signature of Employee: ________________________ Print Name of Employee: _______________________ Date: _________________________CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 13EXHIBIT A-2 OUTSIDE ACTIVITIESCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 14EXHIBIT B GENERAL RELEASE OF ALL CLAIMSThis General Release and Waiver of Claims (this “Release”) is executed by Curtis Campbell (“Executive”) and Blucora, Inc.(the “Company”) as of the date set forth below, and will become effective as of the “Effective Date” as defined below. This Release isin consideration of severance benefits to be paid to Executive by the Company pursuant to the Employment Agreement betweenExecutive and the Company dated as of _____, 2018 (the “Employment Agreement”). Execution of this Release without revocationby Executive will satisfy the requirement, set forth in Section 6(g) of the Employment Agreement, that Executive execute a generalrelease and waiver of claims in order to receive severance benefits pursuant to the Employment Agreement.1.Termination of EmploymentExecutive acknowledges that his employment with the Company and any of its subsidiaries (collectively, the “CompanyGroup”) and any and all appointments he held with any member of the Company Group, whether as officer, director, employee,consultant, agent or otherwise, terminated as of _______________________ (the “Termination Date”). Effective as of theTermination Date, Executive has not had or exercised or purported to have or exercise any authority to act on behalf of the Companyor any other member of the Company Group, nor will Executive have or exercise or purport to have or exercise such authority in thefuture.2.ConsiderationThe Company shall pay Executive the severance benefits pursuant to the Employment Agreement. The Parties agree that butfor signing this Release, Executive would not be entitled to the severance benefits set forth in the Employment Agreement. Theseverance benefits are adequate to make this Release final and binding, and are in addition to payments and benefits to whichExecutive would otherwise be entitled to as an employee or former employee of the Company.3.Waiver and Release(a) Executive, for and on behalf of himself and his heirs and assigns, hereby waives and releases any common law, statutoryor other complaints, claims, charges or causes of action arising out of or relating to Executive’s employment or termination ofemployment with, or Executive’s serving in any capacity in respect of any member of the Company Group (collectively, “Claims”).The Claims waived and released by this Release include any and all Claims, whether known or unknown, whether in law or in equity,which Executive may now have or ever had against any member of the Company Group or any shareholder, employee, officer,director, agent, attorney, representative, trustee, administrator or fiduciary of any member of the Company Group (collectively, the“Company Releasees”) up to and including the date of Executive’s execution of this Agreement. The Claims waived and released bythis Release include, without limitation, any and all Claims arising out of Executive’s employment with the Company Group under, byway of example and not limitation, the Age Discrimination in Employment Act of 1967 (“ADEA”, a law which prohibitsdiscrimination on the basis of age against persons age 40 and older), the National1Labor Relations Act, the Civil Rights Act of 1991, the Americans With Disabilities Act of 1990, Title VII of the Civil Rights Act of1964, the Employee Retirement Income Security Act of 1974, the Family Medical Leave Act, the Securities Act of 1933, theSecurities Exchange Act of 1934, and the Texas Labor Code Chapter 21, all as amended, and all other federal, state and local statutes,ordinances, regulations and the common law, and any and all Claims arising out of any express or implied contract, except as describedin Paragraphs 2(b) and 2(c) below.(b) The waiver and release set forth in this Section 3 is intended to be construed as broadly and comprehensively as applicablelaw permits. The waiver and release shall not be construed as waiving or releasing any claim or right that as a matter of law cannot bewaived or released, including Executive’s right to file a charge with the Equal Employment Opportunity Commission or othergovernment agency.(c) Notwithstanding anything else in this Release, Executive does not waive or release claims with respect to:(i) Executive’s entitlement, if any, to severance benefits pursuant to the Employment Agreement;(ii) vested benefits or payments specifically to be provided to the Executive pursuant to the Employment Agreement orany Company employee benefit plans or policies;(iii) indemnification pursuant to any applicable provision of the Company’s Bylaws or Certificate of Incorporation, asamended, pursuant to any written indemnification agreement between the Executive and the Company, or pursuant to applicable law;(iv) any claims which the Executive may have solely by virtue of the Executive’s status as a shareholder of theCompany; or(v) unemployment compensation to which Executive may be entitled under applicable law.(d) Executive represents and warrants that he is the sole owner of the actual or alleged Claims that are released hereby, that thesame have not been assigned, transferred, or disposed of in fact, by operation of law, or in any manner, and that he has the full rightand power to grant, execute and deliver the releases, undertakings, and agreements contained herein.(e) Subject to Section 4, Executive represents that Executive has not filed any complaints, charges or lawsuits against theCompany with any governmental agency or any court based on Claims that are released and waived by this Release.4.No InterferenceNothing in this Agreement is intended to interfere with Executive’s right to report possible violations of federal, state or locallaw or regulation to any governmental or law enforcement agency or entity, or to make other disclosures that are protected under thewhistleblower provisions of federal, state or local law or regulation. Executive further acknowledges that nothing in this2Agreement is intended to interfere with Executive’s right to file a claim or charge with, or testify, assist, or participate in aninvestigation, hearing, or proceeding conducted by, the Equal Employment Opportunity Commission (the “EEOC”), any state humanrights commission, or any other government agency or entity. However, by executing this Agreement, Executive hereby waives theright to recover any damages or benefits in any proceeding Executive may bring before the EEOC, any state human rights commission,or any other government agency or entity or in any proceeding brought by the EEOC, any state human rights commission, or any othergovernment agency or entity on Executive’s behalf with respect to any claim released in this Agreement except that Executive mayreceive bounty money awarded by the U.S. Securities and Exchange Commission pursuant to Section 21F of the Securities ExchangeAct of 1934 or any similar provision.5.No Admission of WrongdoingThis Release shall not be construed as an admission by either party of any wrongful or unlawful act or breach of contract.6.Legal DisclosureSubject to Section 4, by signing this Agreement, Executive warrants and represents that Executive has reported to HumanResources or Legal all pending and/or threatened legal proceedings of any kind involving or relating to the Company that Executivebecame aware of during Executive’s tenure with the Company. Executive further warrants and represents that Executive has reportedto Human Resources or Legal any alleged violations of law (including alleged securities violations) by the Company that Executivebecame aware of during Executive’s tenure with the Company.7.Binding Agreement; Successors and AssignsThis Release binds Executive’s heirs, administrators, representatives, executors, successors, and assigns, and will inure to thebenefit of the respective heirs, administrators, representatives, executors, successors, and assigns of any person or entity as to whom thewaiver and release set forth in Section 3 applies.8.Other AgreementsThis Release does not supersede or modify in any way Executive’s continuing obligations pursuant to the EmploymentAgreement or the Confidentiality and Non-Competition Agreement (Exhibit A thereto) or the dispute resolution provisions of theEmployment Agreement.9.Knowing and Voluntary Agreement; Consideration and Revocation Periods(a) Executive acknowledges that Executive has been given twenty-one (21) calendar days from the date of receipt of thisRelease to consider all of the provisions of this Release and that if Executive signs this Release before the 21-day period has ended heknowingly and voluntarily waives some or all of such 21-day period.(b) Executive represents that (i) Executive has read this Release carefully, (ii) Executive has hereby been advised by theCompany to consult an attorney of his choice and has either done3so or voluntarily chosen not to do so, (iii) Executive fully understands that by signing below he is giving up certain rights which hemight otherwise have to sue or assert a claim against any of the Company Releasees, and (iv) Executive has not been forced orpressured in any manner whatsoever to sign this Release, and agrees to all of its terms voluntarily.(c) Executive shall have seven (7) calendar days from the date of his execution of this Release (the “Revocation Period”) inwhich Executive may revoke this Release. Such revocation must be in writing and delivered, prior to the expiration of the RevocationPeriod, to the attention of the Company’s Chief Legal Officer at the Company’s then-current headquarters address. If Executiverevokes this Release during the Revocation Period, then the Release shall be null and void and without effect.10.Disclaimer of RelianceExcept for the specific representations expressly made by the Company in the Employment Agreement, Executive specificallydisclaims that Executive is relying upon or has relied upon any communications, promises, statements, inducements, orrepresentation(s) that may have been made, oral or written, regarding the subject matter of this Release. Executive represents thatExecutive relied solely and only on Executive’s own judgment in making the decision to enter into this Release.11.Execution in Multiple CounterpartsThis Release may be executed by the parties in multiple counterparts, whether or not all signatories appear on thesecounterparts (including via electronic signatures and exchange of PDF documents via email), each of which shall be deemed anoriginal, but all of which together shall constitute one and the same instrument.12.Effective DateThe Effective Date of this Release will be day after the Revocation Period expires without revocation by Executive.[Signature Page Follows]4EXECUTIVE HAS ELECTED FREELY AND VOLUNTARILY TO EXECUTE THIS RELEASE, TO FULFILL THEPROMISES SET FORTH IN THE EMPLOYMENT AGREEMENT, AND TO RECEIVE THEREBY THE PAYMENT ANDOTHER CONSIDERATION DESCRIBED IN THE EMPLOYMENT AGREEMENT. EXECUTIVE UNDERSTANDS THAT,BY SIGNING THIS RELEASE, EXECUTIVE IS AGREEING TO WAIVE AND SETTLE THE RELEASED CLAIMSHEREIN THAT EXECUTIVE HAS OR MIGHT HAVE AGAINST THE COMPANY INCLUDING CLAIMS UNDER THEAGE DISCRIMINATION IN EMPLOYMENT ACT. EXECUTIVE’S SIGNATURE BELOW MEANS THAT EXECUTIVEHAS READ THE RELEASE AND UNDERSTANDS AND AGREES THAT EXECUTIVE IS RELEASING ALL CLAIMSAND AGREES AND CONSENTS TO THE TERMS AND CONDITIONS OF THIS EMPLOYMENT AGREEMENT ANDTHIS RELEASE.EXECUTIVE:Signature: _______________________ Printed Name: Curtis Campbell Date: ________________________ THE COMPANY:Blucora, Inc.: Signature: ________________________ Name: ________________________ Title: ________________________ Date: ________________________ 5Exhibit 10.35EMPLOYMENT AGREEMENTThis Employment Agreement (this “Agreement”) is made and entered into as of October 20, 2018, by and between MikeHogan (the “Executive”) and Blucora, Inc. (the “Company”).RECITALSWHEREAS, the Company desires to employ the Executive as the President of Tax Innovation for the Company beginning inlate October 2018, with the start date of his employment being the effective date of this Agreement (the “Effective Date”), and theExecutive desires to serve in such capacity;NOW THEREFORE, in consideration of the foregoing, the mutual covenants contained herein, the employment of theExecutive by the Company, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,the parties hereto agree as follows:1.Certain Definitions(a) “Base Salary” has the meaning set forth in Section 5(a).(b) “Board” means the Board of Directors of the Company.(c) “Cause” means, as determined by the Board in its reasonable discretion: (i) the Executive’s conviction of, or plea of guiltyor nolo contendere to, a misdemeanor involving dishonesty, wrongful taking of property, immoral conduct, bribery or extortion or anyfelony; (ii) willful material misconduct by the Executive in connection with the business of the Company; (iii) the Executive’scontinued and willful failure to perform substantially his responsibilities to the Company under this Agreement, after written demandfor substantial performance has been given by the Board that specifically identifies how the Executive has not substantially performedhis responsibilities; (iv) the Executive’s improper disclosure of confidential information or other material breach of this Agreement,including the Confidentiality and Non-Competition Agreement; (v) the Executive’s material fraud or dishonesty against the Company;(vi) the Executive’s willful and material breach of the Company’s written code of conduct and business ethics or other material writtenpolicy, procedure or guideline in effect from time to time (provided that the Executive was given access to a copy of such policy,procedure or guideline prior to the alleged breach) relating to personal conduct; or (vii) the Executive’s willful attempt to obstruct orwillful failure to cooperate with any investigation authorized by the Board or any governmental or self-regulatory entity. Anydetermination of Cause by the Company shall be made by a resolution approved by a majority of the members of the Board, providedthat, with respect to Section 1(c)(iii), the Board must give the Executive notice and 60 days to cure the substantial nonperformance.(d) “Change of Control” means the occurrence of any of the following:(i) any “person” (as defined in Sections 13(d) and 14(d) of the Exchange Act), excluding for this purpose, (A) theCompany or any subsidiary of the Company or (B) any employeebenefit plan of the Company or any subsidiary of the Company, or any person or entity organized, appointed or established by theCompany for or pursuant to the terms of any such plan that acquires beneficial ownership of voting securities of the Company, is orbecomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of theCompany representing more than 50% of the combined voting power of the Company’s then outstanding securities;(ii) consummation of a reorganization, merger or consolidation of the Company, in each case, unless, following suchtransaction, all or substantially all the individuals and entities who were the beneficial owners of outstanding voting securities of theCompany immediately prior to such transaction beneficially own, directly or indirectly, more than 50% of the combined voting powerof the then outstanding voting securities entitled to vote generally in the election of directors of the company resulting from suchtransaction (including, without limitation, a company that, as a result of such transaction, owns the Company or all or substantially allthe Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownershipimmediately prior to such transaction of the outstanding voting securities of the Company;(iii) any sale or disposition by the Company, in one transaction or a series of related transactions, of all or substantiallyall the Company’s assets;(iv) a “Board Change” which, for purposes of this Agreement, shall have occurred if a majority of the seats on theBoard are occupied by individuals who were neither (A) nominated by a majority of the Incumbent Directors nor (B) appointed bydirectors so nominated (“Incumbent Director” means a member of the Board who has been either (1) nominated by a majority of thedirectors of the Company then in office or (2) appointed by directors so nominated, but excluding, for this purpose, any such individualwhose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by oron behalf of a person other than the Board); or(v) an approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.(e) “Code” means the Internal Revenue Code of 1986, as amended.(f) “Compensation Committee” means the Compensation Committee of the Board.(g) “Confidentiality and Non-Competition Agreement” means the Confidentiality and Non-Competition Agreement attachedhereto as Exhibit A.(h) “Constructive Termination” means the occurrence, on a date that is prior to the two- month period prior to theconsummation of a Change of Control or after the 12-month period following the consummation of a Change of Control, of any of thefollowing without the Executive’s express prior written consent: (i) a material reduction of or to the Executive’s duties, authority orresponsibilities (a change in reporting relationship alone does not constitute such a material reduction); (ii) a material reduction by theCompany of the Executive’s Base Salary, unless similarly2situated executives also experience a reduction; or (iii) a requirement that the Executive relocate his primary work location more than25 miles from Irving, Texas or from any work location to which the Company transfers the Executive during the course of hisemployment and to which such transfer the Executive has consented. Notwithstanding the foregoing, a Constructive Termination shallnot exist unless (x) the Executive delivers written notice to the Company (the “Constructive Termination Notice”) of the existence ofthe condition which the Executive believes constitutes a Constructive Termination within 30 days of the initial existence of suchcondition (which Constructive Termination Notice specifically identifies such condition), (y) the Company fails to remedy suchcondition within 30 days after the date on which it receives such notice (the “Constructive Termination Cure Period”), and (z) theExecutive actually terminates employment within 30 days after the expiration of the Constructive Termination Cure Period.(i) “Disability” means the Executive’s inability to perform his employment duties to the Company hereunder, with or withoutreasonable accommodation, for 180 days (in the aggregate) in any one-year period as determined by an independent physician selectedby the Company.(j) “Exchange Act” means the Securities Exchange Act of 1934, as amended.(k) “Good Reason” means the occurrence of any of the following without the Executive’s express prior written consent: (i) amaterial reduction of or to the Executive’s duties, authority, responsibilities or reporting relationship; (ii) a material reduction of theExecutive’s Base Salary; (iii) a material reduction of the Executive’s Target Bonus; (iv) a material reduction in the kind or level ofemployee benefits to which the Executive is entitled that occurs within 12 months following a Change of Control, unless similarlysituated employees also experience a reduction; (v) a requirement that the Executive relocate his primary work location more than 25miles from Irving, Texas or from any work location to which the Company transfers the Executive during the course of hisemployment and to which such transfer the Executive has consented; (vi) in connection with a Change of Control, the failure of theCompany to assign this Agreement to a successor to the Company or the failure of a successor to the Company to explicitly assumeand agree to be bound by this Agreement in a writing delivered to the Executive; or (vii) a material breach of this Agreement by theCompany.Notwithstanding the foregoing, termination of employment by the Executive will not be for Good Reason unless (x) theExecutive delivers written notice to the Company (the “Good Reason Notice”) of the existence of the condition which the Executivebelieves constitutes Good Reason within 30 days of the initial existence of such condition (which Good Reason Notice specificallyidentifies such condition), the Company fails to remedy such condition within 30 days after the date on which it receives such notice(the “Good Reason Cure Period”), and (z) the Executive actually terminates employment within 30 days after the expiration of theGood Reason Cure Period.(l) “Release” means a full release of claims against the Company substantially in the form attached hereto as Exhibit B;provided, however, that notwithstanding the foregoing, such Release is not intended to and will not waive the Executive’s rights: (i) toindemnification pursuant to any applicable provision of the Company’s Bylaws or Certificate of Incorporation, as amended, pursuantto any written indemnification agreement between the Executive and the Company, or pursuant to applicable law; (ii) to vested benefitsor payments specifically to be provided to the3Executive under this Agreement or any Company employee benefit plans or policies; or (iii) respecting any claims the Executive mayhave solely by virtue of the Executive’s status as a stockholder of the Company. The Release also shall not include claims that anemployee cannot lawfully release through execution of a general release of claims.(m) “Section 409A” means Section 409A of the Code and the Treasury Regulations and official guidance issued in respect ofSection 409A of the Code.(n) “Target Bonus” has the meaning set forth in Section 5(b).2.Duties and Scope of EmploymentThe Company shall employ the Executive in the position of President of Tax Innovation for the Company. The Executive shallreport directly to the Company’s President and Chief Executive Officer. The Executive will render such business and professionalservices in the performance of the Executive’s duties, consistent with the Executive’s position(s) within the Company, as shall bereasonably assigned to the Executive at any time and from time to time by the Company’s President and Chief Executive Officer.Upon termination of the Executive’s employment for any reason, unless otherwise requested by the President and Chief ExecutiveOfficer, the Executive will be deemed to have resigned from all positions held at the Company and its affiliates voluntarily, withoutany further action by the Executive, as of the end of the Executive’s employment, and the Executive, at the President and ChiefExecutive Officer’s request, will execute any documents necessary to reflect his resignation.3.ObligationsWhile employed hereunder, the Executive will perform his duties ethically, faithfully and to the best of the Executive’s abilityand in accordance with law and Company policy. The Executive agrees not to actively engage in any other employment, occupation orconsulting activity for any direct or indirect remuneration without the express prior written approval of the Company’s President andChief Executive Officer; provided, however, that notwithstanding anything to the contrary in the Confidentiality and Non-CompetitionAgreement, the Executive may engage in charitable activities so long as such activities do not materially interfere with the Executive’sresponsibilities to the Company.4.Agreement TermUnless earlier terminated as provided herein, the term of this Agreement (the “Agreement Term”) shall be for a period of threeyears commencing on the Effective Date, and may be extended thereafter upon the written mutual agreement of the Executive and theCompany.5.Compensation and Benefits(a) Base Salary. The Company agrees to pay the Executive a base salary (the “Base Salary”) at an annual rate of not less than$380,000, payable in accordance with the regular payroll4practices of the Company, but not less frequently than monthly. The Executive’s Base Salary shall be subject to annual review by theBoard (or a committee thereof).(b) Annual Bonus. The Executive shall be eligible to participate in the Company’s bonus and other incentive compensationplans and programs for the Company’s senior executives at a level commensurate with his position. The Executive shall have theopportunity to earn an annual target bonus (the “Target Bonus”) measured against criteria to be determined by the Board (or acommittee thereof) of at least 120% of Base Salary. The Executive’s Target Bonus amount for 2018 will be pro-rated to reflect thenumber of days of the Executive’s employment in 2018. The payout of any 2018 bonus will occur following the end of theCompany’s Executive Bonus Plan (the “Plan”) year, which is December 31, 2018, and will be paid in accordance with the terms andconditions of the Plan. Payment of any bonus pursuant to this Section 5(b) is subject to the Executive’s employment by the Companyon the date required in the Plan. The Company reserves the right to change the Plan at any time at its discretion.(c) Equity Awards. The Executive will be eligible to participate in the Company’s long-term equity incentive programsextended to senior executives of the Company generally at levels commensurate with the Executive’s position, which participation andlevels shall be determined by the Board (or a committee thereof) in its sole discretion. In 2019, the Company’s President and ChiefExecutive Officer shall recommend that the Board (or a committee thereof) grant the Executive, for 2019, equity award(s) with a totalaggregate target value of $874,000 on the date of grant, with such award(s) consisting of a combination of the following types ofawards as determined by the Board (or a committee thereof), in its sole discretion: time-based restricted stock units (vesting over threeyears), performance-based restricted stock units (eligible for vesting based on performance following a three-year performance period),and/or nonqualified stock options (vesting over three years); provided, however, that the Board (or committee thereof) retains the solediscretion to establish the terms and the types of awards that are granted to the Executive with respect to 2019.(d) Benefits. The Executive and his eligible dependents shall be eligible to participate in the employee benefit plans that areavailable or that become available to other employees of the Company, with the adoption or maintenance of such plans to be in thediscretion of the Company, subject in each case to the generally applicable terms and conditions of the plan or program in question andto the determination of any committee administering such plan or program. Such benefits shall include participation in the groupmedical, life, disability, and retirement plans that are made generally available to employees of the Company, and any supplementalplans available to senior executives of the Company from time to time. The Company reserves the right to change or terminate itsemployee benefit plans and programs at any time.(e) Expenses. The Company shall reimburse the Executive for reasonable business expenses incurred by the Executive in thefurtherance of or in connection with the performance of the Executive’s duties hereunder, in accordance with the Company’s expensereimbursement policy as in effect from time to time.(f) Initial Equity Award. As a material inducement to the Executive’s willingness to accept employment with the Company,on or shortly following the Effective Date, the Executive shall be granted an award of time-based restricted stock units having anaggregate value of $250,0005on the date of grant that ratably over the three-year period from the date of grant (i.e., 1/3 will vest on the first anniversary of the date ofgrant, and 1/3 will vest on each following anniversary of the date of grant) so long as Executive is employed by the Company on suchdate (the “Initial RSUs”).The number of Initial RSUs granted to the Executive in accordance with this Section 5(f) shall be determined by dividing the value ofthe Initial RSUs being awarded by the closing price of the Company’s common stock on the date of grant and rounding down for anyfractional shares. The Initial RSUs may be granted under the Blucora, Inc. 2016 Equity Inducement Plan, as amended (the“Inducement Plan”), or the Blucora, Inc. 2018 Long-Term Incentive Plan (the “LTIP”) and will vest in accordance with, and havesuch other terms and conditions as are specified in, the Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreementapproved by the Compensation Committee with respect to such award (the “Restricted Stock Unit Agreement”) and shall otherwise besubject to the terms and conditions of the Inducement Plan or LTIP and the Restricted Stock Unit Agreement; provided, however, thatnotwithstanding the foregoing, in the event of a conflict between the terms and conditions of the Restricted Stock Unit Agreement andthis Agreement, the terms and conditions of this Agreement shall prevail.6.Termination of Employment(a) General Provisions. This Agreement and the Executive’s employment with the Company may be terminated by either theExecutive or the Company at will at any time with or without Cause; provided, however, that the parties’ rights and obligations uponsuch termination during the Agreement Term shall be as set forth in applicable provisions of this Agreement.(b) Any Termination by Company or the Executive. In the event of any termination of the Executive’s employment with theCompany, whether by the Company or by the Executive, (i) the Company shall pay the Executive any unpaid Base Salary due forperiods prior to the date of termination of employment (“Termination Date”); (ii) the Company shall pay the Executive any unpaidbonus compensation pursuant to Section 5(b), to the extent earned through the Termination Date, subject to the terms of theCompany’s Executive Bonus Plan (or any successor plan thereto); and (iii) following submission of proper expense reports by theExecutive, the Company shall reimburse the Executive for all expenses reasonably and necessarily incurred by the Executive inconnection with the business of the Company through the Termination Date (collectively, the “Accrued Obligations”). The AccruedObligations shall be paid promptly upon termination and within the period of time mandated by applicable law (but, in any event,within 30 days after the Termination Date). The Accrued Obligations paid or provided pursuant to this Section 6(b) shall be in additionto the payments and benefits, if any, to be provided to the Executive upon his termination of employment pursuant to Section 6(c),6(d), 6(e), or 6(f) as applicable. Except as expressly stated above or as required by law or this Agreement, the Executive shall receiveno further compensation in any form other than as set forth in this Section 6(b).(c) Termination by Company Without Cause or Constructive Termination. If, other than in connection with a Change ofControl as described in Section 6(d), the Executive’s employment with the Company is terminated by the Company without Cause orthe Executive terminates employment with the Company under circumstances constituting a Constructive Termination, then subject toSection 6(g), the Executive shall receive the following payments and benefits:6(i) a severance payment in an amount equal to one times the Executive's Base Salary in effect as of the TerminationDate (or if the Executive terminates employment under circumstances constituting a Constructive Termination due to a materialreduction of the Executive's Base Salary, in effect immediately prior to such reduction) (less applicable withholding taxes), whichamount shall be payable in a single lump sum on the first payroll date that is at least 60 days following the Termination Date (but, inany event, by no later than March 15 of the calendar year immediately following the calendar year that includes the Termination Date),in accordance with Section 14(b)(ii); and(ii) a lump-sum payment in an amount equal to (A) the monthly COBRA premium in effect under the Company’sgroup health plan as of the Termination Date for the coverage in effect under such plan for the Executive (and the Executive’s spouseand dependent children) on such date multiplied by (B) 12 (less applicable withholding taxes), which amount shall be payable in asingle lump sum on the first payroll date that is at least 60 days following the Termination Date (but, in any event, by no later thanMarch 15 of the calendar year immediately following the calendar year that includes the Termination Date), in accordance withSection 14(b)(ii); provided, however, that notwithstanding the foregoing or any other provision in this Agreement to the contrary, theCompany (or its successor) may unilaterally amend this Section 6(c)(ii) or eliminate the benefit provided hereunder to the extent itdeems necessary to avoid the imposition of excise taxes, penalties or similar charges on the Company or any of its subsidiaries,affiliates or successors, including, without limitation, under Section 4980D of the Code.Notwithstanding any provision to the contrary in any Company equity compensation plan or any outstanding equity awardagreement, if, during the Agreement Term, the Executive terminates employment with the Company under circumstances described inthis Section 6(c), there shall be no acceleration of vesting or exercisability of any outstanding equity awards or extension of any optionpost- termination exercise period.For the avoidance of doubt, under no circumstances will the Executive be entitled to payments and benefits under both thisSection 6(c) and Section 6(d).(d) Termination of Employment in Connection With a Change of Control. If the Company terminates the Executive’semployment without Cause or the Executive terminates employment with the Company for Good Reason (1) on the day of or duringthe 12-month period immediately following the consummation of a Change of Control or (2) during the 2-month period prior to theconsummation of a Change of Control but at the request of any third party participating in or causing the Change of Control orotherwise in connection with the Change of Control, then subject to Section 6(g) and with respect to clause (2), subject to theconsummation of such Change of Control, the Executive shall receive the following payments and benefits:(i) a severance payment in an amount equal to one times the Executive's Base Salary in effect as of the TerminationDate and his then current Target Bonus amount (or if the Executive terminates employment for Good Reason due to a materialreduction of the Executive's Base Salary or Target Bonus, in effect immediately prior to such reduction) (in each case less applicablewithholding taxes), which amount shall be payable in a single lump sum on the first payroll date that is at least 60 days following theTermination Date (but, in any event, by no later7than March 15 of the calendar year immediately following the calendar year that includes the Termination Date), in accordance withSection 14(b)(ii);(ii) a lump-sum payment in an amount equal to (A) the monthly COBRA premium in effect under the Company’sgroup health plan as of the Termination Date for the coverage in effect under such plan for the Executive (and the Executive’s spouseand dependent children) on such date multiplied by (B) 12 (less applicable withholding taxes), which amount shall be payable in asingle lump sum on the first payroll date that is at least 60 days following the Termination Date (but, in any event, by no later thanMarch 15 of the calendar year immediately following the calendar year that includes the Termination Date), in accordance withSection 14(b)(ii); provided, however, that notwithstanding the foregoing or any other provision in this Agreement to the contrary, theCompany (or its successor) may unilaterally amend this Section 6(d)(ii) or eliminate the benefit provided hereunder to the extent itdeems necessary to avoid the imposition of excise taxes, penalties or similar charges on the Company or any of its subsidiaries,affiliates or successors, including, without limitation, under Section 4980D of the Code; and(iii) notwithstanding any provision to the contrary in any applicable equity compensation plan or any outstandingequity award agreement, the treatment of the Executive’s outstanding equity awards shall be governed solely by the followingprovisions: (A) all of the Executive’s then-outstanding time-vesting equity awards shall fully vest and all restrictions thereon shalllapse, and (B) to the extent vested (including as a result of the acceleration provided under this Section 6(d)(iii)), all of the Executive’soutstanding stock options shall remain exercisable until the first to occur of 12 months following the Termination Date and each suchstock option’s original expiration date.If a Change of Control is consummated prior to the expiration of the Agreement Term, this Section 6(d) shall apply to atermination of the Executive’s employment by the Company without Cause or by the Executive for Good Reason during the 12-monthperiod immediately following the consummation of the Change of Control even if such 12-month period extends past the expiration ofthe Agreement Term. Moreover, notwithstanding the expiration of the Agreement Term, if a Change of Control is consummatedwithin two months after the expiration of the Agreement Term, then this Section 6(d) shall apply to a termination of the Executive’semployment by the Company without Cause or by the Executive for Good Reason (i) on the day of or during the 12-month periodimmediately following the consummation of the Change of Control or (ii) during the 2-month period prior to the consummation of theChange of Control but at the request of any third party participating in or causing the Change of Control or otherwise in connectionwith the Change of Control.For the avoidance of doubt, the payments and benefits described under this Section 6(d) and the Accrued Obligations shall bethe only payments and benefits to which the Executive is entitled in the event that the Executive’s employment terminates under thisSection 6(d).(e) Death. In the event of the Executive’s death while employed hereunder, and subject to Section 6(g), the Executive’sbeneficiary (or such other person(s) specified by will or the laws of descent and distribution) shall be entitled to receive a lump-sumpayment in an amount equal to three months’ Base Salary in effect as of the Termination Date (less applicable withholding taxes),which amount shall be payable in a single lump sum on the first payroll date that is at least 60 days8following the Termination Date (but, in any event, by no later than March 15 of the calendar year immediately following the calendaryear that includes the Termination Date), in accordance with Section 14(b)(ii).(f) Disability. In the event of the Executive’s termination of employment with the Company due to Disability, and subject toSection 6(g), the Executive shall be entitled to receive a lump- sum payment in an amount equal to six months’ Base Salary in effect asof the Termination Date (less applicable withholding taxes), which amount shall be payable in a single lump sum on the first payrolldate that is at least 60 days following the Termination Date (but, in any event, by no later than March 15 of the calendar yearimmediately following the calendar year that includes the Termination Date), in accordance with Section 14(b)(ii).(g) Release and Other Conditions. The payments and benefits described in Sections 6(c) through 6(f) are expresslyconditioned on (i) the Executive (or, in the case of the Executive’s death, the Executive’s representative) signing and delivering (andnot revoking thereafter) a Release to the Company (which, in the case of the Executive’s death, also releases any claims by theExecutive’s estate or survivors), which Release is executed, delivered and effective no later than 60 days following the TerminationDate and (ii) the Executive continuing to satisfy any obligations to the Company under this Agreement, the Release and theConfidentiality and Non-Competition Agreement that are incorporated herein by reference, and any other agreement(s) between theExecutive and the Company. In the event the Release described in Section 6(g)(i) is not executed, delivered and effective by the 60thday after the Termination Date, none of such payments or benefits shall be provided to the Executive.7.Section 280G(a) Amount of Payments and Benefits. Notwithstanding anything to the contrary herein, in the event that the Executivebecomes entitled to receive or receives any payments, options, awards or benefits (including, without limitation, the monetary value ofany noncash benefits and the accelerated vesting of equity-based awards) under this Agreement or under any other plan, agreement orarrangement with the Company or any person affiliated with the Company (collectively, the “Payments”), that may separately or in theaggregate constitute “parachute payments” within the meaning of Section 280G of the Code and the Treasury Regulationspromulgated thereunder (or any similar or successor provision) (collectively, “Section 280G”) and it is determined that, but for thisSection 7(a), any of the Payments will be subject to any excise tax pursuant to Section 4999 of the Code or any similar or successorprovision (the “Excise Tax”), the Company shall pay to the Executive either (i) the full amount of the Payments or (ii) an amount equalto the Payments, reduced by the minimum amount necessary to prevent any portion of the Payments from being an “excess parachutepayment” (within the meaning of Section 280G) (the “Capped Payments”), whichever of the foregoing amounts results in the receiptby the Executive, on an after-tax basis, of the greatest amount of Payments notwithstanding that all or some portion of the Paymentsmay be subject to the Excise Tax. For purposes of determining whether the Executive would receive a greater after-tax benefit from theCapped Payments than from receipt of the full amount of the Payments, (i) there shall be taken into account any Excise Tax and allapplicable federal, state and local taxes required to be paid by the Executive in respect of the receipt of such payments and (ii) suchpayments9shall be deemed to be subject to federal income taxes at the highest rate of federal income taxation applicable to individuals that is ineffect for the calendar year in which the payments and benefits are to be paid, and state and local income taxes at the highest rate oftaxation applicable to individuals in the state and locality of the Executive’s residence on the effective date of the relevant transactiondescribed under Section 280G(b)(2)(A)(i) of the Code, net of the maximum reduction in federal income taxes that could be obtainedfrom deduction of such state and local taxes (as determined by assuming that such deduction is subject to the maximum limitationapplicable to itemized deductions under Section 68 of the Code and any other limitations applicable to the deduction of state and localincome taxes under the Code).(b) Computations and Determinations. All computations and determinations called for by this Section 7 shall be made by anindependent accounting firm or independent tax counsel appointed by the Company (the “Tax Counsel”), and all such computationsand determinations shall be conclusive and binding on the Company and the Executive. For purposes of such calculations anddeterminations, the Tax Counsel may rely on reasonable, good faith interpretations concerning the application of Sections 280G and4999 of the Code. The Tax Counsel shall submit its determination and detailed supporting calculations to both the Executive and theCompany within 15 days after receipt of a notice from either the Company or the Executive that the Executive may receive paymentswhich may be considered “parachute payments.” The Company and the Executive shall furnish to the Tax Counsel such informationand documents as the Tax Counsel may reasonably request in order to make the computations and determinations called for by thisSection 7. The Company shall bear all costs that the Tax Counsel may reasonably incur in connection with the computations anddeterminations called for by this Section 7.(c) Reduction Methodology. In the event that Section 7(a) applies and a reduction is required to be applied to the Paymentsthereunder, the Payments shall be reduced by the Company in its reasonable discretion in the following order: (i) reduction of anyPayments that are subject to Section 409A on a pro-rata basis or such other manner that complies with Section 409A, as determined bythe Company, and (ii) reduction of any Payments that are exempt from Section 409A.8.No Impediment to AgreementThe Executive hereby represents to the Company that the Executive is not, as of the date hereof, and will not be, during theExecutive’s employment with the Company, employed under contract, oral or written, by any other person, firm or entity, and is notand will not be bound by the provisions of any restrictive covenant or confidentiality agreement that would constitute an impedimentto, or restriction upon, the Executive’s ability to enter this Agreement and to perform the duties of the Executive’s employment.9.Confidentiality and Non-Competition AgreementThe Confidentiality and Non-Competition Agreement is incorporated by reference as if set forth fully herein. TheConfidentiality and Non-Competition Agreement shall survive the termination of this Agreement and/or the Executive’s employmentwith the Company.1010.CooperationThe Executive hereby agrees to provide the Executive’s full cooperation, at the request of the Company, with any of theCompany Releasees (as defined in the Release) in any and all such lawsuits, investigations or other legal, equitable or business mattersor proceedings which involve any matters for which the Executive worked on or had responsibility during the Executive’s employmentwith the Company. The Executive also agrees to be available to the Company and its representatives (including attorneys) to providegeneral advice or assistance as requested by the Company. This includes but is not limited to testifying (and preparing to testify) as awitness in any proceeding or otherwise providing information or reasonable assistance to the Company in connection with anyinvestigation, claim or suit, and cooperating with the Company regarding any investigation, litigation, claims or other disputed itemsinvolving the Company that relate to matters within the knowledge or responsibility of the Executive. Specifically, the Executiveagrees (i) to meet with the Company’s representatives, its counsel or other designees at reasonable times and places with respect to anyitems within the scope of this provision; (ii) to provide truthful testimony regarding same to any court, agency or other adjudicatorybody; (iii) to provide the Company with immediate notice of contact or subpoena by any non-governmental adverse party (known tothe Executive to be adverse to the Company or its interests); and (iv) to not voluntarily assist any such non-governmental adverse partyor such non-governmental adverse party’s representatives. The Executive acknowledges and understands that the Executive’sobligations of cooperation under this Section 10 are not limited in time and may include, but shall not be limited to, the need for oravailability for testimony. The Executive shall receive no additional compensation for time spent assisting the Company pursuant tothis Section 10 other than the compensation and benefits provided for in this Agreement, provided that the Executive shall be entitledto be reimbursed for any reasonable out-of-pocket expenses incurred in fulfilling the Executive’s obligations pursuant to subsections (i)and (ii) above. Notwithstanding the foregoing, nothing in this Section 10 is intended to interfere with the Executive’s No Interferencerights set forth in Section 1(c) of the Confidentiality and Non-Competition Agreement.11.Arbitration(a) The Executive agrees that any dispute and/or claim between the Company (including without limitation its officers,directors, employees agents or shareholders and its subsidiaries) and the Executive that underlies, relates to and/or results from theExecutive’s employment relationship with the Company or the termination of that relationship or any of the terms of this Agreement,except for any dispute or claim arising from or relating to the Confidentiality and Non-Competition Agreement, that cannot be resolvedby mutual agreement of the Company and the Executive will be submitted to final, binding arbitration to the maximum extent permittedby law in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association thatare then in effect. This arbitration provision includes, but is not limited to, claims of wrongful discharge, infliction of emotional distress,breach of contract (including breach of this Agreement), breach of any covenant of good faith and fair dealing, and claims of retaliationand/or discrimination in violation of any local, state or federal law. Examples of such laws include Title VII of the Civil Rights Act of1964; the Age Discrimination in Employment Act of 1967; the Americans with Disabilities Act of 1990; and the Family and MedicalLeave Act of 1993, and all11amendments to each such law as well as the regulations issued thereunder. This arbitration provision does not affect the Executive’sright to pursue worker’s compensation or unemployment compensation benefits for which he may be eligible in accordance with statelaw, nor does it affect the Executive’s right to file and/or to cooperate in the investigation of an administrative charge of discrimination.(b) Notwithstanding this arbitration provision, either the Executive or the Company may apply to any court of competentjurisdiction for a temporary restraining order, preliminary injunction, or other interim or conservatory relief, as necessary, withoutbreach of this Agreement and without abridgement of the powers of the arbitrator.(c) This arbitration provision does not apply to any dispute or claim arising from or relating to the Confidentiality and Non-Competition Agreement.(d) The Company, as further consideration for the Executive’s agreement to arbitrate covered disputes, agrees to pay for thearbitrator’s fees and other costs directly associated with the arbitration that would not otherwise be charged if the parties pursued civillitigation in court.12.Successors; Personal ServicesThe services and duties to be performed by the Executive hereunder are personal and may not be assigned or delegated. ThisAgreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and the Executive and theExecutive’s heirs and representatives.13.NoticesNotices and all other communications contemplated by this Agreement shall be in writing and shall be deemed to have beenduly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid.In the case of the Executive, mailed notices shall be addressed to the Executive at the home address the Executive most recentlycommunicated to the Company in writing. In the case of the Company, mailed notices shall be addressed to its corporate headquarters,and all notices shall be directed to the attention of its President and Chief Executive Officer.14.Section 409A(a) The parties intend that this Agreement and the payments and benefits provided hereunder be exempt from the requirementsof Section 409A, to the maximum extent possible, whether pursuant to the short-term deferral exception described in TreasuryRegulation Section 1.409A-1(b)(4), the involuntary separation pay plan exception described in Treasury Regulation Section 1.409A-1(b)(9)(iii), or otherwise. To the extent Section 409A is applicable to this Agreement, the parties intend that this Agreement and anypayments and benefits thereunder comply with the deferral, payout and other limitations and restrictions imposed under Section 409A.Notwithstanding anything herein to the contrary, this Agreement shall be interpreted, operated and administered in a manner consistentwith such intentions.12(b) Without limiting the generality of the foregoing, and notwithstanding any other provision of this Agreement to thecontrary:(i) if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that termunder Section 409A, then with regard to any payment that is considered a “deferral of compensation” under Section 409A payable onaccount of a “separation from service,” such payment shall be made on the date which is the earlier of (A) the date that is six monthsand one day after the date of such “separation from service” of the Executive and (B) the date of the Executive’s death (the “DelayPeriod”), to the extent required under Section 409A. Within ten business days following the expiration of the Delay Period, allpayments delayed pursuant to this Section 14(b)(i) (whether they would have otherwise been payable in a single sum or in installmentsin the absence of such delay) shall be paid to the Executive in a lump sum, and all remaining payments due under this Agreement shallbe paid or provided in accordance with the normal payment dates specified for those payments in this Agreement;(ii) to the extent that any payments or benefits under this Agreement are conditioned on a Release, if the Release isexecuted and delivered by the Executive to the Company and becomes irrevocable and effective within the specified 60-day post-termination period, then, subject to Section 14(b)(i) and to the extent not exempt under Section 409A, such payments or benefits shallbe made or commence on the first payroll date after the date that is 60 days after the Termination Date (but, in any event, by no laterthan March 15 of the calendar year immediately following the calendar year that includes the Termination Date). If a payment orbenefit under this Agreement is conditioned on a Release and such Release is not executed, delivered and effective by the 60th dayafter the Termination Date, such payment or benefit shall not be paid or provided to the Executive;(iii) all expenses or other reimbursements under this Agreement shall be made on or prior to the last day of the taxableyear following the taxable year in which such expenses were incurred by the Executive. No such reimbursement or expenses eligiblefor reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year, and theExecutive’s right to reimbursement shall not be subject to liquidation or exchange for any other benefit;(iv) for purposes of Section 409A, the Executive’s right to receive a series of installment payments pursuant to thisAgreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreementspecifies a payment period with reference to a number of days (e.g., “payment shall be made within 30 days”), the actual date ofpayment within the specified period shall be within the sole discretion of the Company;(v) in no event shall any payment under this Agreement that constitutes a “deferral of compensation” for purposes ofSection 409A be offset by any other payment pursuant to this Agreement or otherwise; and(vi) to the extent required for purposes of compliance with Section 409A, termination of employment shall not bedeemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits uponor following a termination13of employment unless such termination is also a “separation from service” within the meaning of Section 409A, and for purposes ofany such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separationfrom service.”(c) The Company and the Executive agree to work together in good faith to consider amendments to this Agreement and totake such reasonable actions that may be necessary, appropriate, or desirable to avoid imposition of additional tax or incomerecognition on the Executive under Section 409A, in each case to the maximum extent permitted by applicable law. Notwithstandingany provision of this Agreement to the contrary, (i) in no event will the Company be liable for any additional tax, interest or penaltythat may be imposed on the Executive by Section 409A or damages for failing to comply with Section 409A and (ii) the Executiveacknowledges and agrees that the Executive will not have any claim or right of action against the Company or any of its employees,officers, directors or agents in the event it is determined that any payment or benefit provided hereunder does not comply with Section409A.15.Miscellaneous Provisions(a) Waiver. No provision of this Agreement shall be modified, waived or discharged unless the modification, waiver ordischarge is agreed to in writing and signed by the Executive and by an authorized officer of the Company (other than the Executive).No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other partyshall be considered a waiver of any other condition or provision or of the same condition or provision at another time.(b) Entire Agreement. This Agreement (including exhibits) shall supersede and replace all prior agreements or understandingsrelating to the subject matter hereof, and no agreements, representations or understandings (whether oral or written or whether expressor implied) that are not expressly set forth in this Agreement have been made or entered into by either party with respect to the relevantmatters hereof. This Agreement may not be modified except expressly in a writing signed by both parties.(c) Disclaimer of Reliance. Except for the specific representations expressly made by the Company in this Agreement, theExecutive specifically disclaims that the Executive is relying upon or has relied upon any communications, promises, statements,inducements, or representation(s) that may have been made, oral or written, regarding the subject matter of this Agreement. TheExecutive represents that the Executive relied solely and only on the Executive’s own judgment in making the decision to enter intothis Agreement.(d) Choice of Law. The validity, interpretation, construction and performance of this Agreement shall be governed by theinternal substantive laws of the State of Texas without reference to any choice of law rules.(e) Severability. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect thevalidity or enforceability of any other provision hereof, which shall remain in full force and effect.14(f) No Assignment of Benefits. The rights of any person to payments or benefits under this Agreement shall not be madesubject to option or assignment, either by voluntary or involuntary assignment or by operation of law, in respect of bankruptcy,garnishment, attachment or other creditor’s process, and any action in violation of this Section 15(f) shall be void.(g) No Duty to Mitigate. The Executive shall not be required to mitigate the amount of any payment contemplated by thisAgreement, nor shall any such payment be reduced by any earnings that the Executive may receive from any other source.(h) Employment Taxes. All payments made pursuant to this Agreement will be subject to withholding of all applicableincome, employment and other taxes.(i) Assignment by Company. The Company may assign its rights under this Agreement to an affiliate (as defined under theExchange Act), and an affiliate may assign its rights under this Agreement to another affiliate of the Company or to the Company. Inthe case of any such assignment, the term “Company” when used in a section of this Agreement shall mean the corporation thatactually employs the Executive.(j) Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all ofwhich together will constitute one and the same instrument.[Signature Page Follows]15IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorizedofficer, as of the day and year first above written.BLUCORA, INC. By: /s/ John S. Clendening Name: John S. ClendeningTitle: President and Chief Executive Officer EXECUTIVE: /s/ Mike HoganMike Hogan16EXHIBIT ACONFIDENTIALITY AND NON-COMPETITION AGREEMENTThis Confidentiality and Non-Competition (“Agreement”) is entered into by and between Blucora, Inc., its subsidiaries,affiliates, successors and/or assigns (the “Company”) and Mike Hogan (“Executive”). The Effective Date of this Agreement is the dateof Executive’s execution of this Agreement. The Company and Executive shall be referred to herein individually as a “Party” andcollectively as the “Parties.”NOW, THEREFORE, in consideration of the mutual covenants set forth herein, Executive’s position with the Company, theConfidential Information (defined below), compensation and benefits provided to Executive, and other good and valuableconsideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the Partiesagree as follows:1.Confidential Information and Executive’s Non-Disclosure Agreement.(a) Confidential Information. During Executive’s employment with the Company, the Company shall provide Executive withConfidential Information (defined below), which is not known to the Company’s competitors or within the Company’s industrygenerally, which was developed by the Company over a long period of time and/or at its substantial expense, and which is of greatcompetitive value to the Company. For purposes of this Agreement, “Confidential Information” includes all documents orinformation, in whatever form or medium, concerning or relating to any of the following: all trade secrets and confidential andproprietary information of or relating to the Company, including, but not limited to: (A) financial models, business records, businessplans or processes, strategies (including, without limitation, economic and market research selection and analysis strategies andbusiness development and market segment exploitation strategies), tactics, policies, resolutions, processes, inventions, patents,trademarks, trade secrets, know how, patent or trademark applications and other intellectual property, (B) information regardinglitigation or negotiations, (C) any marketing information, sales or product plans, prospects and market research data relating to thebusiness, (D) financial information, cost and performance data and any debt arrangements, equity ownership or securities transactioninformation, (E) technical information, technical drawings and designs, (F) personnel information, personnel lists, resumes, personneldata, organizational structure, compensation and performance evaluations, (G) customer, consumer, consultants or supplierinformation, including but not limited to any data regarding any current, prospective or former customers, consumers, consultants orsuppliers of Company, (H) information regarding the existence or terms of any agreement or relationship between the Company or anyof its subsidiaries or affiliates and any other party, (I) information subject to Section 628 of the Fair Credit Reporting Act and anyregulations or guidelines thereunder and (J) any other information of whatever nature, including, without limitation, information whichgives to the Company or any of its subsidiaries or affiliates an opportunity to obtain an advantage over its competitors who or which donot have access to such information. Confidential Information, whether prepared or compiled by Executive and/or the Company orfurnished to Executive during Executive’s employment with the Company, shall be the sole and exclusive property of the Company,and none of such Confidential Information or copies thereof, shall be retained by Executive.CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 1Executive agrees not to dispute, contest, or deny any such ownership rights either during or after Executive’s employment with theCompany. Executive acknowledges that the Company does not voluntarily disclose Confidential Information, but rather takesprecautions to prevent dissemination of Confidential Information beyond those employees such as Executive entrusted with suchinformation. Executive further acknowledges that the Confidential Information: (a) is entrusted to Executive because of Executive’sposition with the Company; and (b) is of such value and nature as to make it reasonable and necessary for Executive to protect andpreserve the confidentiality and secrecy of the Confidential Information. Executive acknowledges and agrees that the ConfidentialInformation is proprietary to and a trade secret of the Company and, as such, is a valuable, special and unique asset of the Company,the unauthorized use or disclosure of which will cause irreparable harm, substantial injury and loss of profits and goodwill to theCompany. “Confidential Information” does not include any information which is generally available to and known by the public orbecomes generally available to and known by the public (other than as a result of Executive’s breach of this Agreement or any otheragreement or obligation to keep such information confidential).(b) Non-Disclosure.(i) Executive agrees to preserve and protect the confidentiality of all Confidential Information. Executive agrees thatduring the period of Executive’s employment with the Company and at any time thereafter (regardless of the reason for Executive’sseparation or termination of employment): (A) Executive shall hold all Confidential Information in the strictest confidence, take allreasonable precautions and steps to safeguard all Confidential Information and prevent its wrongful use by or wrongful or inadvertentdisclosure or dissemination to any unauthorized person or entity, and follow all policies and procedures of the Company protecting orregarding the Confidential Information; and (B) without prior written authorization of the Company, Executive shall not, directly orindirectly, use for Executive’s own account, use in any way or for any other purpose, disclose to anyone, publish, exploit, destroy,copy or remove from the offices of the Company, nor solicit, allow or assist another person or entity to use, disclose, publish, exploit,destroy, copy or remove from the offices of the Company, any Confidential Information or part thereof, except: (1) as permitted in theproper performance of Executive’s duties for the Company; (2) as permitted in the ordinary course of the Company’s business for thebenefit of the Company; or (3) as otherwise permitted or required by law. Executive shall immediately notify the Company ifExecutive learns of or suspects any actual or potential unauthorized use or disclosure of Confidential Information concerning theCompany. Further, the Executive shall not, directly or indirectly, use the Company’s Confidential Information to: (1) call upon, solicitbusiness from, attempt to conduct business with, conduct business with, interfere with or divert business away from any customer,client, service provider, supplier or vendor of the Company with whom or which the Company conducted business; and/or (2) recruit,solicit, hire or attempt to recruit, solicit, or hire, directly or by assisting others, any persons employed by the Company. In the eventExecutive is subpoenaed, served with any legal process or notice, or otherwise requested to produce or divulge, directly or indirectly,any Confidential Information by any entity, agency or person in any formal or informal proceeding including, but not limited to, anyinterview, deposition, administrative or judicial hearing and/or trial, except where prohibited by law, Executive should immediatelynotify the Company and deliver a copy of the subpoena, process, notice or other request to the CompanyCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 2as promptly as possible, but under no circumstances more than ten (10) days following Executive’s receipt of same; provided,however, Executive is not required to notify the Company or provide a copy of the subpoena, process, notice or other request whereExecutive is permitted to make such disclosure of Confidential Information pursuant to this Agreement or applicable law or regulation,as set forth in Section 1(c) and Section 1(d).(ii) Subject to Section 1(b)(iii), Executive agrees that Executive will not use or disclose any confidential, proprietary ortrade secret information belonging to any former employer or third party, and Executive will not bring onto the premises of theCompany or onto any Company property, any confidential, proprietary or trade secret information belonging to any former employeror third party without such third party’s written consent. Executive acknowledges that that the Company has specifically instructedExecutive not to disclose to the Company, use, or induce the Company to use, any confidential, proprietary or trade secret informationbelonging to any previous employer or others.(iii) During Executive’s employment, the Company will receive from third parties their confidential and/or proprietaryinformation, subject to a duty on the Company’s part to maintain the confidentiality of and to use such information only for certainlimited purposes. Executive agrees to hold all such confidential or proprietary information in the strictest confidence and not to discloseit to any person or organization or to use it except as necessary in the course of Executive’s employment with the Company and inaccordance with the Company’s agreement with such third party.(iv) Except in the proper performance of Executive’s duties and responsibilities, Executive agrees that Executive shallnot remove, destroy, deface, damage or delete any Property of the Company. For purposes of this Agreement, the term “Property”means all property or information, in whatever form or media, and all copies thereof whether or not the original was deleted ordestroyed, of the Company, including, without limitation, any Confidential Information, software, hardware, including any and allCompany-issued equipment, devices, cellular telephones, tablets, computers, laptops, hard drives, keys, access cards, access codes orpasswords belonging to the Company, databases, files, records, reports, memoranda, research, plans, proposals, lists, forms, drawings,specifications, notebooks, manuals, correspondence, materials, e-mail, electronic or magnetic recordings or data, and any other physicalor electronic documents that Executive receives from or sends to any employee of the Company, that Executive copies from the files orrecords of the Company, or that Executive otherwise has access to during Executive’s employment.(c) No Interference. Notwithstanding any other provision of this Agreement, (i) Executive may disclose ConfidentialInformation when required to do so by a court of competent jurisdiction, by any governmental agency having authority over Executiveor the business of the Company or by any administrative body or legislative body (including a committee thereof) with jurisdiction toorder Executive to divulge, disclose or make accessible such information; and (ii) nothing in this Agreement is intended to interferewith Executive’s right to (A) report possible violations of state or federal law or regulation to any governmental or law enforcementagency or entity; (B) make other disclosures that are protected under the whistleblower provisions of state or federal law or regulation;(C) file a claim or charge with any governmental agency or entity; or (D)CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 3testify, assist, or participate in an investigation, hearing, or proceeding conducted by any governmental or law enforcement agency orentity, or any court. For purposes of clarity, in making or initiating any such reports or disclosures or engaging in any of the conductoutlined in subsection (ii) above, Executive may disclose Confidential Information to the extent necessary to such governmental or lawenforcement agency or entity or such court, need not seek prior authorization from the Company, and is not required to notify theCompany of any such reports, disclosures or conduct.(d) Defend Trade Secrets Act. Executive is hereby notified in accordance with the Defend Trade Secrets Act of 2016 thatExecutive will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret thatis made in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney solely for thepurpose of reporting or investigating a suspected violation of law, or is made in a complaint or other document that is filed under seal ina lawsuit or other proceeding.(e) Inventions.(i) Prior Inventions Retained and Licensed. In Exhibit A-1 to this Agreement, Executive has provided a list describingall Inventions (defined below) that Executive: (A) conceived, created, developed, made, reduced to practice or completed, either aloneor with others, prior to Executive’s employment with the Company; (B) claims a proprietary right or interest in; and (C) does not assignto the Company hereunder (collectively referred to as the “Prior Inventions”). If no such list is attached, Executive represents thatthere are no such Prior Inventions. Executive understands and agrees that the Company makes no attempt to verify Executive’s claimof ownership to any of the Prior Inventions. Executive agrees that Executive shall not incorporate in any work that Executive performsfor the Company any Prior Inventions or any of the technology described in any Prior Inventions. Nonetheless, if in the course ofExecutive’s employment with the Company, Executive incorporates Prior Inventions into a product, service, process or machine of theCompany, Executive hereby grants and shall be deemed to have granted the Company a nonexclusive, royalty-free, irrevocable,sublicensable, transferable, perpetual, and worldwide license to make, have made, modify, use, import, reproduce, distribute, prepareand have prepared derivative works of, offer to sell, sell and otherwise exploit such Prior Inventions. For purposes of this Agreement,the term “Inventions” means all tangible and intangible materials, work product, information, methods, designs, computer programs,software, databases, formulas, models, prototypes, reports, discoveries, ideas, improvements, know-how, compositions of matter,processes, photographs, drawings, illustrations, sketches, developments, and all related intellectual property, including inventions,original works of authorship, moral rights, mask works, trade secrets and trademarks.(ii) Assignment of Inventions. During Executive’s employment with the Company and following the termination ofExecutive’s employment for any reason, Executive agrees that Executive shall promptly make full written disclosure to the Company,shall hold in trust for the sole right and benefit of the Company, and hereby assigns and shall be deemed to have assigned to theCompany or its designee, all of Executive’s right, title, and interest in and to any and all Inventions that have been or may beconceived, created, developed, completed, reduced toCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 4practice or otherwise made by Executive, solely or jointly with others, during the period of Executive’s employment with the Companywhich (A) relate in any manner to the existing or contemplated business, work, or investigations of the Company; (B) are suggestedby, result from, or arise out of any work that Executive may do for or on behalf of the Company; (C) result from or arise out of anyConfidential Information that may have been disclosed or otherwise made available to Executive as a result of duties assigned toExecutive by the Company; or (D) are otherwise made through the use of the time, information, equipment, facilities, supplies ormaterials of the Company, even if developed, conceived, reduced to practice or otherwise made during other than working hours(collectively referred to as “Company Inventions”). Executive further acknowledges that all original works of authorship that are madeby Executive (solely or jointly with others) within the scope of Executive’s employment with the Company and that are protectable bycopyright are “Works Made for Hire,” as that term is defined in the United States Copyright Act. Executive understands and agreesthat the decision whether or not to commercialize or market any Company Inventions is within the Company’s sole discretion and forthe Company’s sole benefit, and that no royalty will be due to Executive as a result of the Company’s efforts to commercialize ormarket any such Company Invention.(iii) Maintenance of Records. Executive agrees to keep and maintain adequate and current hard-copy and electronicrecords of all Company Inventions. The records will be available to and remain the sole property of the Company during Executive’semployment with the Company and at all times thereafter.(f) Patent and Copyright Registrations. Executive agrees to assist the Company or its designee, at the Company’s expense, inevery proper way to secure the Company’s rights in Company Inventions in any and all countries, including the disclosure to theCompany of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments,affidavits, and all other instruments which the Company shall deem necessary in order to apply for and obtain such rights and in orderto assign and convey to the Company and/or its successors, assigns and nominees, the sole and exclusive rights, title and interest in andto such Company Inventions. Executive further agrees that Executive’s obligation to execute or cause to be executed, when it is inExecutive’s power to do so, any such instrument or papers shall continue after the termination of this Agreement. Executive herebyappoints the General Counsel of the Company as Executive’s attorney-in-fact to execute documents on Executive’s behalf for thispurpose. Executive agrees that this appointment is coupled with an interest and will not be revocable.(g) Return of Company Property. Upon request by the Company or upon the termination of Executive’s employment for anyreason, Executive shall immediately return and deliver to the Company any and all Property, including, without limitation, ConfidentialInformation, software, hardware, including any and all Company-issued equipment, devices, cellular telephones, tablets, computers,laptops, hard drives, keys, access cards, access codes or passwords, databases, files, documents, records, reports, memoranda, research,plans, proposals, lists, papers, books, forms, drawings, specifications, notebooks, manuals, correspondence, materials, e-mail,electronic or magnetic recordings or data, including all copies thereof (in electronic or hard copy format), which belong to theCompany or which relate to the Company’s business and which are in Executive’s possession, custody or control, whether preparedby Executive or others. Executive further agreesCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 5that after Executive provides such Property to the Company, Executive will immediately destroy any information or documents,whether prepared by Executive or others, containing or reflecting any Confidential Information or relating to the business of theCompany from any computer, cellular phone or other digital or electronic device in Executive’s possession, custody or control, andExecutive shall certify such destruction in writing to the Company. Upon request by the Company, Executive shall provide suchcomputer, cellular phone or other digital or electronic device to the Company or the Company’s designee for inspection to confirm thatsuch information and documents have been destroyed. If at any time after the termination of Executive’s employment for any reason,Executive or the Company determines that Executive has any Property in Executive’s possession, custody or control, Executive shallimmediately return all such Property, including all copies and portions thereof, to the Company.2. Restrictive Covenants. In consideration for (i) the Company’s promise to provide Confidential Information; (ii) thesubstantial economic investment made by the Company in the Confidential Information and goodwill of the Company, and/or thebusiness opportunities disclosed or entrusted to Executive; (iii) access to the customers and clients of the Company; and (iv) theCompany’s employment of Executive in an executive position and the compensation and other benefits provided by the Company toExecutive (including the consideration provided for in the Incentive Retention Letter), to protect the Confidential Information andbusiness goodwill of the Company, Executive agrees to the following restrictive covenants.(a) Non-Competition. Executive agrees that during the Executive’s employment with the Company and for a period of twelve(12) months after the Executive’s employment terminates for any reason (the “Restricted Period”), other than in connection withExecutive’s performance of his duties for the Company, Executive shall not, and shall not use any Confidential Information to, withoutthe prior written consent of an officer of the Company, directly or indirectly, either individually or as a principal, partner, stockholder,manager, agent, consultant, contractor, distributor, employee, lender, investor, or as a director or officer of any corporation orassociation, or in any other manner or capacity whatsoever, (i) control, manage, operate, establish, take steps to establish, lend moneyto, invest in, solicit investors for, or otherwise provide capital to, or (ii) become employed by, join, perform services for, consult for, dobusiness with or otherwise engage in any Competing Business within the Restricted Area. For purposes of this Consulting Agreement,given the scope of Confidential Information to be provided to Executive and job duties to be performed by the Executive, “RestrictedArea” means the United States, and any other geographic area for which Executive performed any services or about which Executivereceived Confidential Information. For purposes of this Agreement, “Competing Business” means any business, individual,partnership, firm, corporation or other entity that is competing or that is preparing to compete with any aspect of the Company’sbusiness, which includes, but is not limited to (a) tax preparation and tax preparation-related products and services provided toconsumers and small businesses, and to or through tax professionals; (b) investment and insurance products or services, and relatedadvice and brokerage services, provided to or through tax professionals or in conjunction with tax preparation services, and (c) anyother business the Company engages in or develops during the Executive’s employment with the Company.CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 6(b) Non-Solicitation. During the Restricted Period, other than in connection with Executive’s duties for the Company,Executive shall not, and shall not use any Confidential Information to, directly or indirectly, either as a principal, manager, agent,employee, consultant, officer, director, stockholder, partner, investor or lender or in any other capacity, and whether personally orthrough other persons, solicit business from, interfere with, or induce to curtail or cancel any business or contracts with the Company,or attempt to solicit business with, interfere with, or induce to curtail or cancel any business or contracts with the Company, or dobusiness with any actual or prospective customer or client of the Company with whom the Company did business or who theCompany solicited within the preceding two (2) years, and who or which: (1) Executive contacted, called on, serviced or did businesswith during Executive’s employment with the Company; (2) Executive learned of as a result of Executive’s employment with theCompany; or (3) about whom Executive received Confidential Information. This restriction applies only to business which is in thescope of services or products provided by the Company.(c) Non-Recruitment. During the Restricted Period, other than in connection with Executive’s duties for the Company,Executive shall not, on behalf of Executive or on behalf of any other person or entity, directly or indirectly, hire, solicit or recruit, orattempt to hire, solicit or recruit, or encourage to leave or otherwise cease his/her employment or engagement with the Company, anyindividual who is an employee or independent contractor of the Company or who was an employee or independent contractor of theCompany within the twelve (12) month period prior to Executive’s separation from employment with the Company.(d) Non-Disparagement. Executive agrees that the Company’s goodwill and reputation are assets of great value to theCompany, which have been obtained and maintained through great costs, time and effort. Therefore, Executive agrees that duringExecutive’s employment and after the termination of Executive’s employment, Executive shall not make, publish or otherwise transmitany knowingly false statements, whether written or oral, regarding the Company and its officers, directors, executives, employees,contractors, consultants, products, services, business or business practices. A violation or threatened violation of this Section 2(d) maybe enjoined by the courts. The rights afforded the Company under this provision are in addition to any and all rights and remediesotherwise afforded by law. However, nothing in this Section 2(d) restricts or prevents Executive from providing truthful testimony asrequired by court order or other legal process or is intended to interfere with Executive’s rights set forth in Section 1(c).(e) Tolling. If Executive violates any of the covenants contained in this Section 2, the Restricted Period applicable to suchcovenant(s) shall be suspended and shall not run in favor of Executive from the time of the commencement of such violation until thetime that Executive cures the violation to the satisfaction of the Company and the period of time in which Executive is in breach shallbe added to the Restricted Period applicable to such covenant(s).3. Reasonableness. Executive hereby represents to the Company that Executive has read and understands, and agrees to bebound by, the terms of Section 1 and Section 2. Executive acknowledges that the scope and duration of the restrictions and covenantscontained in Section 1 and Section 2 are fair and reasonable in light of (i) the nature and scope of the operations of the Company’sbusiness; and (ii) the amount of compensation and Confidential Information (including,CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 7without limitation, trade secrets) that Executive is receiving in connection with Executive’s employment with the Company and theIncentive Retention Letter. It is the desire and intent of the Parties that the provisions of Section 1 and Section 2 be enforced to thefullest extent permitted under applicable law, whether now or hereafter in effect and therefore, to the extent permitted by applicablelaw, Executive and the Company hereby waive any provision of applicable law that would render any provision of Section 1 and/orSection 2 invalid or unenforceable.4. Remedies. Executive acknowledges that the restrictions and covenants contained in Section 1 and Section 2, in view of thenature of the Company’s business and Executive’s position with the Company, are reasonable and necessary to protect the Company’slegitimate business interests, goodwill and reputation, and that any violation of Section 1 or Section 2 would result in irreparable injuryand continuing damage to the Company, and that money damages would not be a sufficient remedy to the Company for any suchbreach or threatened breach. Therefore, Executive agrees that the Company shall be entitled to a temporary restraining order andinjunctive relief restraining Executive from the commission of any breach or threatened breach of Section 1 and/or Section 2, withoutthe necessity of establishing irreparable harm or the posting of a bond, and to recover from Executive damages incurred by theCompany as a result of the breach, as well as the Company’s attorneys’ fees, costs and expenses related to any breach or threatenedbreach of this Agreement and enforcement of this Agreement. Nothing contained in this Agreement shall be construed as prohibitingthe Company from pursuing any other remedies available to it for any breach or threatened breach, including, without limitation, therecovery of money damages, attorneys’ fees, and costs. The existence of any claim or cause of action by Executive against theCompany, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of therestrictions or covenants contained in Section 1 or Section 2, or preclude injunctive relief.5. Business Opportunities. Executive, without further compensation, assigns and agrees to assign to the Company and itssuccessors, assigns or designees, all of Executive’s right, title and interest in and to all Business Opportunities (defined below), andfurther acknowledges and agrees that all Business Opportunities constitute the exclusive property of the Company. Executive shallpresent all Business Opportunities to the Company, and shall not exploit a Business Opportunity. For purposes of this Agreement,“Business Opportunities” means all business ideas, prospects, or proposals pertaining to any aspect of the Company’s business andany business the Company prepared to conduct or contemplated conducting during Executive’s employment with the Company, whichare developed by Executive or originated by any third party and brought to the attention of Executive, together with informationrelating thereto. For the avoidance of doubt, this Section 5 is not intended to limit or narrow Executive’s duties or obligations underfederal or state law with respect to corporate opportunities.6. Conflicting Activities. Executive agrees that, during Executive’s employment with the Company, Executive shall notengage in any employment, consulting relationship, business or other activity that (i) is in any way competitive with the business orproposed business of the Company (except that Executive may invest less than one percent (1%) of the shares of a company traded ona registered stock exchange); (ii) conflicts with Executive’s duty of loyalty, responsibilities or obligations to the Company or interfereswith the independent exercise of Executive’s judgmentCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 8in the Company’s best interests; or (iii) adversely affects the performance of Executive’s job duties and responsibilities with theCompany. Executive agrees to not assist any other person or organization in competing with the Company or in preparing to engage incompetition with the Company or proposed business of the Company. Executive further agrees that, during Executive’s employmentwith the Company, Executive shall not actively engage in any other employment, occupation or consulting activity for any direct orindirect remuneration without the prior approval of Executive’s direct supervisor or the Company’s Legal Department. Executive haslisted on the Company’s Outside Activity Disclosure form, attached hereto as Exhibit B-1, any business activities or ventures withwhich Executive is involved. If no such list is attached, Executive represents that there are no such outside activities as of the date ofthis Agreement.7. Breach Executive acknowledges that Executive is subject to immediate dismissal by the Company for any breach of thisAgreement and that such a dismissal will not relieve Executive from any continuing obligations under this Agreement or from theimposition by a court of any judicial remedies, including, without limitation, money damages and/or injunctive relief for such breach.8. Notice. If Executive, in the future, seeks or is offered employment, or any other position or capacity with another company,entity or person, Executive agrees to inform each such company, entity or person of the existence of the restrictions in Section 1 andSection 2. The Company shall be entitled to advise such company, entity or person and third parties of the provisions of Section 1 andSection 2 and to otherwise deal with such company, entity, person or third party to ensure that the provisions of Section 1 and Section2 are enforced and duly discharged.9. Reformation. The Company and Executive agree that in the event any of the terms, provisions, covenants or restrictionscontained in this Agreement, or any part thereof, shall be held by any court of competent jurisdiction to be effective in any particulararea or jurisdiction only if said term, provision, covenant or restriction is modified to limit its duration or scope, then the court shallhave such authority to so reform the term, provision, covenant or restriction and the Parties hereto shall consider such term, provision,covenant or restriction to be amended and modified with respect to that particular area or jurisdiction so as to comply with the order ofany such court and, as to all other jurisdictions, the term, provision, covenant or restriction contained herein shall remain in full forceand effect as originally written. By agreeing to this contractual modification prospectively at this time, the Company and Executiveintend to make Section 1 and Section 2 enforceable under the law or laws of all applicable jurisdictions so that the restrictive covenantsin their entirety and this Agreement as prospectively modified shall remain in full force and effect and shall not be rendered void orillegal.10. Severability. In the event any court of competent jurisdiction or any foreign, federal, state, county or local government orany other governmental regulatory or administrative agency or authority holds any provision of this Agreement to be invalid, illegal orunenforceable, such invalid, illegal or unenforceable portion(s) shall be limited or excluded from this Agreement to the minimum extentrequired, and the remaining provisions shall not be affected or invalidated and shall remain in full force and effect.CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 911. Binding Effect of Agreement and Assignment. This Agreement shall be binding upon and inure to the benefit of theParties hereto and their respective heirs, successors, legal representatives and permitted assigns. Executive may not assign thisAgreement to a third party. The Company may assign its rights, together with its obligations hereunder, to any affiliate and/orsubsidiary of the Company or any successor thereto or any purchaser of substantially all of the assets of the Company, withoutExecutive’s consent and without advance notice.12. Survival. Executive agrees that Executive’s obligations under this Agreement shall continue in effect after the terminationof Executive’s employment, regardless of the reason(s) for termination, and whether such termination is voluntary or involuntary.13. Waiver. The failure of either Party to insist in any one or more instances upon performance of any terms or conditions ofthis Agreement shall not be construed as a waiver of future performance of any such term, covenant or condition, but the obligations ofeither Party with respect thereto shall continue in full force and effect. No waiver of any breach of this Agreement shall be construed tobe a waiver as to succeeding breaches and no waiver of any provisions of this Agreement shall constitute a waiver of any otherprovision of this Agreement. The breach by one Party to this Agreement shall not preclude equitable relief, injunctive relief or theobligations in Section 1 or Section 2.14. Controlling Law. This Agreement shall be governed by and construed under the laws of the State of Texas, withoutregard to any applicable conflict of law or choice of law rules.15. Venue. Venue of any dispute arising out of, in connection with or in any way related to this Agreement shall be in a statedistrict court of competent jurisdiction in Dallas County, Texas, or the United States District Court for the Northern District of Texas.Executive consents to personal jurisdiction of the state district courts of Dallas County, Texas and to the United States District Courtfor the Northern District of Texas for any dispute arising out of, in connection with or in any way related to this Agreement, and agreesthat Executive shall not challenge personal jurisdiction in such courts. Executive waives any objection that Executive may now orhereafter have to the venue or jurisdiction of any proceeding in such courts or that any such proceeding was brought in an inconvenientforum (and agrees not to plead or claim the same).16. WAIVER OF JURY TRIAL. WITH RESPECT TO ANY DISPUTE BETWEEN EXECUTIVE AND THECOMPANY ARISING OUT OF, IN CONNECTION WITH OR IN ANY WAY RELATED TO THIS AGREEMENT,EMPLOYEE AGREES TO RESOLVE SUCH DISPUTE(S) BEFORE A JUDGE WITHOUT A JURY. EMPLOYEE HASKNOWLEDGE OF THIS PROVISION, AND WILL PROVIDE SERVICES TO THE COMPANY THEREAFTER, HEREBYWAIVING EXECUTIVE’S RIGHT TO TRIAL BY JURY AND AGREES TO HAVE ANY DISPUTE(S) ARISINGBETWEEN THE COMPANY AND EXECUTIVE ARISING OUT OF, IN CONNECTION WITH OR IN ANY WAYRELATED TO THIS AGREEMENT RESOLVED BY A JUDGE OF A COMPETENT COURT IN DALLAS COUNTY,TEXAS, SITTING WITHOUT A JURY.17. Entire Agreement. This Agreement constitutes the entire agreement between the Parties with respect to the subject matterhereof, and fully supersedes any and all prior andCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 10contemporaneous agreements, understandings and/or representations between the Parties, whether oral or written, pertaining to thesubject matter of this Agreement; provided, however, Executive’s obligations under this Agreement are in addition to Executive’sobligations under any applicable law or regulation and the Company’s policies and procedures. No oral statements or prior writtenmaterial not specifically incorporated in this Agreement shall be of any force and effect, and no changes in or additions to thisAgreement shall be recognized, unless incorporated in this Agreement by written amendment, such amendment to become effective onthe date stipulated in it. Any amendment to this Agreement must be signed by all parties to this Agreement.18. Disclaimer of Reliance. Except for the specific representations expressly made by the Company in this Agreement,Executive specifically disclaims that Executive is relying upon or has relied upon any communications, promises, statements,inducements, or representation(s) that may have been made, oral or written, regarding the subject matter of this Agreement. Executiverepresents that Executive relied solely and only on Executive’s own judgment in making the decision to enter into this Agreement.19. Voluntary Agreement. Executive (i) acknowledges that Executive has read and understands the terms of this Agreementand believes them to be reasonable, (ii) agrees that the consideration provided by the Company for this Agreement is reasonable, and(iii) is voluntarily executing this Agreement as signified by Executive’s signature hereto,.20. Execution in Multiple Counterparts. This Agreement may be executed in multiple counterparts, whether or not allsignatories appear on these counterparts, and each counterpart shall be deemed an original for all purposes.[Signature Page Follows]CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 11The signatures below indicate that the Parties have read, understand and will comply with this Agreement. EXECUTIVE:Signature: _____________________ Printed Name: Mike Hogan Date: ______________________ THE COMPANY:Blucora, Inc.: Signature: ______________________ Name: ______________________ Title: ______________________ Date: ______________________ CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 12EXHIBIT A-1 LIST OF PRIOR INVENTIONSTitleDateIdentifying Number or Brief Description ____ No Inventions____ Additional Sheets Attached Signature of Employee: _________________________ Print Name of Employee: ________________________ Date: __________________________CONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 13EXHIBIT A-2 OUTSIDE ACTIVITIESCONFIDENTIALITY AND NON-COMPETITION AGREEMENT Page 14EXHIBIT B GENERAL RELEASE OF ALL CLAIMSThis General Release and Waiver of Claims (this “Release”) is executed by Mike Hogan (“Executive”) and Blucora, Inc. (the“Company”) as of the date set forth below, and will become effective as of the “Effective Date” as defined below. This Release is inconsideration of severance benefits to be paid to Executive by the Company pursuant to the Employment Agreement betweenExecutive and the Company dated as of _____, 2018 (the “Employment Agreement”). Execution of this Release without revocationby Executive will satisfy the requirement, set forth in Section 6(g) of the Employment Agreement, that Executive execute a generalrelease and waiver of claims in order to receive severance benefits pursuant to the Employment Agreement.1.Termination of EmploymentExecutive acknowledges that his employment with the Company and any of its subsidiaries (collectively, the “CompanyGroup”) and any and all appointments he held with any member of the Company Group, whether as officer, director, employee,consultant, agent or otherwise, terminated as of _______________________ (the “Termination Date”). Effective as of theTermination Date, Executive has not had or exercised or purported to have or exercise any authority to act on behalf of the Companyor any other member of the Company Group, nor will Executive have or exercise or purport to have or exercise such authority in thefuture.2.ConsiderationThe Company shall pay Executive the severance benefits pursuant to the Employment Agreement. The Parties agree that butfor signing this Release, Executive would not be entitled to the severance benefits set forth in the Employment Agreement. Theseverance benefits are adequate to make this Release final and binding, and are in addition to payments and benefits to whichExecutive would otherwise be entitled to as an employee or former employee of the Company.3.Waiver and Release(a) Executive, for and on behalf of himself and his heirs and assigns, hereby waives and releases any common law, statutoryor other complaints, claims, charges or causes of action arising out of or relating to Executive’s employment or termination ofemployment with, or Executive’s serving in any capacity in respect of any member of the Company Group (collectively, “Claims”).The Claims waived and released by this Release include any and all Claims, whether known or unknown, whether in law or in equity,which Executive may now have or ever had against any member of the Company Group or any shareholder, employee, officer,director, agent, attorney, representative, trustee, administrator or fiduciary of any member of the Company Group (collectively, the“Company Releasees”) up to and including the date of Executive’s execution of this Agreement. The Claims waived and released bythis Release include, without limitation, any and all Claims arising out of Executive’s employment with the Company Group under, byway of example and not limitation, the Age Discrimination in Employment Act of 1967 (“ADEA”, a law which prohibitsdiscrimination on the basis of age against persons age 40 and older), the National1Labor Relations Act, the Civil Rights Act of 1991, the Americans With Disabilities Act of 1990, Title VII of the Civil Rights Act of1964, the Employee Retirement Income Security Act of 1974, the Family Medical Leave Act, the Securities Act of 1933, theSecurities Exchange Act of 1934, and the Texas Labor Code Chapter 21, all as amended, and all other federal, state and local statutes,ordinances, regulations and the common law, and any and all Claims arising out of any express or implied contract, except as describedin Paragraphs 2(b) and 2(c) below.(b) The waiver and release set forth in this Section 3 is intended to be construed as broadly and comprehensively as applicablelaw permits. The waiver and release shall not be construed as waiving or releasing any claim or right that as a matter of law cannot bewaived or released, including Executive’s right to file a charge with the Equal Employment Opportunity Commission or othergovernment agency.(c) Notwithstanding anything else in this Release, Executive does not waive or release claims with respect to:(i) Executive’s entitlement, if any, to severance benefits pursuant to the Employment Agreement;(ii) vested benefits or payments specifically to be provided to the Executive pursuant to the Employment Agreement orany Company employee benefit plans or policies;(iii) indemnification pursuant to any applicable provision of the Company’s Bylaws or Certificate of Incorporation, asamended, pursuant to any written indemnification agreement between the Executive and the Company, or pursuant to applicable law;(iv) any claims which the Executive may have solely by virtue of the Executive’s status as a shareholder of theCompany; or(v) unemployment compensation to which Executive may be entitled under applicable law.(d) Executive represents and warrants that he is the sole owner of the actual or alleged Claims that are released hereby, that thesame have not been assigned, transferred, or disposed of in fact, by operation of law, or in any manner, and that he has the full rightand power to grant, execute and deliver the releases, undertakings, and agreements contained herein.(e) Subject to Section 4, Executive represents that Executive has not filed any complaints, charges or lawsuits against theCompany with any governmental agency or any court based on Claims that are released and waived by this Release.4.No InterferenceNothing in this Agreement is intended to interfere with Executive’s right to report possible violations of federal, state or locallaw or regulation to any governmental or law enforcement agency or entity, or to make other disclosures that are protected under thewhistleblower provisions of federal, state or local law or regulation. Executive further acknowledges that nothing in this2Agreement is intended to interfere with Executive’s right to file a claim or charge with, or testify, assist, or participate in aninvestigation, hearing, or proceeding conducted by, the Equal Employment Opportunity Commission (the “EEOC”), any state humanrights commission, or any other government agency or entity. However, by executing this Agreement, Executive hereby waives theright to recover any damages or benefits in any proceeding Executive may bring before the EEOC, any state human rights commission,or any other government agency or entity or in any proceeding brought by the EEOC, any state human rights commission, or any othergovernment agency or entity on Executive’s behalf with respect to any claim released in this Agreement except that Executive mayreceive bounty money awarded by the U.S. Securities and Exchange Commission pursuant to Section 21F of the Securities ExchangeAct of 1934 or any similar provision.5.No Admission of WrongdoingThis Release shall not be construed as an admission by either party of any wrongful or unlawful act or breach of contract.6.Legal DisclosureSubject to Section 4, by signing this Agreement, Executive warrants and represents that Executive has reported to HumanResources or Legal all pending and/or threatened legal proceedings of any kind involving or relating to the Company that Executivebecame aware of during Executive’s tenure with the Company. Executive further warrants and represents that Executive has reportedto Human Resources or Legal any alleged violations of law (including alleged securities violations) by the Company that Executivebecame aware of during Executive’s tenure with the Company.7.Binding Agreement; Successors and AssignsThis Release binds Executive’s heirs, administrators, representatives, executors, successors, and assigns, and will inure to thebenefit of the respective heirs, administrators, representatives, executors, successors, and assigns of any person or entity as to whom thewaiver and release set forth in Section 3 applies.8.Other AgreementsThis Release does not supersede or modify in any way Executive’s continuing obligations pursuant to the EmploymentAgreement or the Confidentiality and Non-Competition Agreement (Exhibit A thereto) or the dispute resolution provisions of theEmployment Agreement.9.Knowing and Voluntary Agreement; Consideration and Revocation Periods(a) Executive acknowledges that Executive has been given twenty-one (21) calendar days from the date of receipt of thisRelease to consider all of the provisions of this Release and that if Executive signs this Release before the 21-day period has ended heknowingly and voluntarily waives some or all of such 21-day period.(b) Executive represents that (i) Executive has read this Release carefully, (ii) Executive has hereby been advised by theCompany to consult an attorney of his choice and has either done3so or voluntarily chosen not to do so, (iii) Executive fully understands that by signing below he is giving up certain rights which hemight otherwise have to sue or assert a claim against any of the Company Releasees, and (iv) Executive has not been forced orpressured in any manner whatsoever to sign this Release, and agrees to all of its terms voluntarily.(c) Executive shall have seven (7) calendar days from the date of his execution of this Release (the “Revocation Period”) inwhich Executive may revoke this Release. Such revocation must be in writing and delivered, prior to the expiration of the RevocationPeriod, to the attention of the Company’s Chief Legal Officer at the Company’s then-current headquarters address. If Executiverevokes this Release during the Revocation Period, then the Release shall be null and void and without effect.10.Disclaimer of RelianceExcept for the specific representations expressly made by the Company in the Employment Agreement, Executive specificallydisclaims that Executive is relying upon or has relied upon any communications, promises, statements, inducements, orrepresentation(s) that may have been made, oral or written, regarding the subject matter of this Release. Executive represents thatExecutive relied solely and only on Executive’s own judgment in making the decision to enter into this Release.11.Execution in Multiple CounterpartsThis Release may be executed by the parties in multiple counterparts, whether or not all signatories appear on thesecounterparts (including via electronic signatures and exchange of PDF documents via email), each of which shall be deemed anoriginal, but all of which together shall constitute one and the same instrument.12.Effective DateThe Effective Date of this Release will be day after the Revocation Period expires without revocation by Executive.[Signature Page Follows]4EXECUTIVE HAS ELECTED FREELY AND VOLUNTARILY TO EXECUTE THIS RELEASE, TO FULFILL THEPROMISES SET FORTH IN THE EMPLOYMENT AGREEMENT, AND TO RECEIVE THEREBY THE PAYMENT ANDOTHER CONSIDERATION DESCRIBED IN THE EMPLOYMENT AGREEMENT. EXECUTIVE UNDERSTANDS THAT,BY SIGNING THIS RELEASE, EXECUTIVE IS AGREEING TO WAIVE AND SETTLE THE RELEASED CLAIMSHEREIN THAT EXECUTIVE HAS OR MIGHT HAVE AGAINST THE COMPANY INCLUDING CLAIMS UNDER THEAGE DISCRIMINATION IN EMPLOYMENT ACT. EXECUTIVE’S SIGNATURE BELOW MEANS THAT EXECUTIVEHAS READ THE RELEASE AND UNDERSTANDS AND AGREES THAT EXECUTIVE IS RELEASING ALL CLAIMSAND AGREES AND CONSENTS TO THE TERMS AND CONDITIONS OF THIS EMPLOYMENT AGREEMENT ANDTHIS RELEASE.EXECUTIVE:Signature: _____________________ Printed Name: Mike Hogan Date: ______________________ THE COMPANY:Blucora, Inc.: Signature: _______________________ Name: _______________________ Title: _______________________ Date: _______________________ 5Exhibit 10.36SEPARATION AND RELEASE AGREEMENT This Separation and Release Agreement (“Agreement”) is entered into by and between Blucora, Inc. (the “Company”), H.D.Vest, Inc., (“HD Vest”) and Robert D. Oros (“Executive”), effective as the date both Parties execute this Agreement (“Effective Date”).The Company and Executive are referred to herein individually, as a “Party” and collectively, as the “Parties.” Defined terms notdefined in this Agreement have the meaning set forth in the Employment AgreementWHEREAS, Executive has been employed by the Company as its Chief Executive Officer (“CEO”);WHEREAS, Executive executed an Employment Agreement with the Company effective as of January 22, 2017(“Employment Agreement”);WHEREAS, Executive voluntarily resigns his employment and officer position effective November 15, 2018 (the “SeparationDate”);WHEREAS, Executive agrees to make himself available following the Separation Date to provide transition services to theCompany through March 1, 2019 (the “Transition Period”);WHEREAS, the Parties desire to set forth Executive’s separation benefits and obligations and to finally, fully and completelyresolve all matters arising from or during Executive’s employment and separation from employment, any benefits, bonuses andcompensation connected with such employment and all other disputes and matters that the Parties may have for any reason; andNOW, THEREFORE, in consideration of the premises and mutual covenants and agreements hereinafter set forth, and forother good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree asfollows:End of Executive’s Employment and Transition.(a)The Parties agree that Executive’s employment with the Company shall terminate on the Separation Date. All ofExecutive’s positions with the Company, including all officer positions, shall terminate effective as of the Separation Date. Executiveshall execute all documents and take such further steps as may be required to effectuate such termination(s). Executive shall notperform any work except as set forth in this Agreement, and shall not make any representations or execute any documents, or take anyother actions, on behalf of the Company as of the Separation Date. The Company shall pay Executive for all base salary earned butunpaid through the Separation Date, and shall reimburse Executive for all reasonable business expenses incurred and submitted inaccordance with the Company’s policies.(b)Notwithstanding the foregoing, Executive agrees to cooperate fully and provide assistance during the TransitionPeriod, as requested by the Company, in the orderly transitioning of Executive’s duties and responsibilities to such other persons as theCompany shall designate and agrees to thoroughly and diligently perform those duties and actions which are necessary or appropriateto cause such orderly transition. Executive agrees to: (i) fully inform the Company and Executive’s successors of all activities in whichExecutive was involved prior to the Separation Date and of the status of any projects; (ii) transfer or otherwise make available toExecutive’s successors or others designated by the Company to the extent possible, all of Executive’s knowledge and experienceregarding Executive’s duties; (iii) accomplish a smooth transition of Executive’s responsibilities to Executive’s successors; (iv) complywith the Company’s and HD Vest’s codes of conduct and employee handbooks, and this Agreement, (v) not takeSEPARATION AND RELEASE AGREEMENT Page 1any action contrary to the goodwill, reputation, and ongoing business of the Company including not making any disparagingcomments regarding the Company or its officers, directors, executives, shareholders or employees; and (vi) take all steps necessary tomaintain, and in no way act to hinder, the foregoing duties (collectively, the “Transition Services”). Executive acknowledges andagrees that Executive shall continue to receive his base salary during the Transition Period as compensation for the Transition Servicesbut shall receive no other compensation other than the compensation and benefits provided for in this Agreement. Should Executiveprovide the Transition Services to the satisfaction of the Company throughout the term of the Transition Period, Executive will beentitled to vest previously granted equity, which has vesting dates during the Transition Period. Further, the Company and Executiveagree that, should Executive accept a full-time role which (a) does not violate Section 7 of this Agreement or the terms of the SurvivingAgreement (as defined below), (b) has a start date of January 1, 2019 or later, and (c) for which no public announcement in any wayrelated to Executive’s acceptance of the role or employment with the employer is made before January 1, 2019, Executive mayterminate the Transition Period with fifteen days’ notice to the Company. If Executive terminates the Transition Period pursuant to thisSection 1(b) prior to the date of vesting of any equity awards that occurs during the Transition Period, Executive will forfeit the vestingof equity which would have otherwise vested in the Transition Period.2. Consideration. Provided that Executive complies and remains in continued compliance with this Agreement and theSurviving Agreement and does not revoke this Agreement under Section 17, the Company agrees to waive Executive’s obligation inExhibit C of the Employment Agreement, Commuting, Relocation and Other Expenses, to repay to the Company allMoving/Commuting Expenses paid by the Company or reimbursed to the Executive. Executive acknowledges and agrees that, but forthis Agreement, Executive is not otherwise entitled to the consideration set forth in this Section 2. In the event Executive fails to timelyexecute this Agreement, or revokes this Agreement in accordance with Section 17 below, or breaches the terms of this Agreement,Executive must fully repay to the Company all Moving/Commuting Expenses as set forth in Exhibit C of the Employment Agreement.Other than the consideration provided for in this Agreement, Executive shall not be entitled to any additional compensation, bonuses,severance pay, payments, grants, options or benefits under the Employment Agreement, any other agreement or any benefit plan, longterm incentive plan, short term incentive plan, severance pay plan or bonus or incentive program established by the Company.3. Release. In consideration of the promises of the Company provided herein, including, the consideration provided for inSection 2 and other consideration provided for in this Agreement, that being good and valuable consideration, the receipt, adequacyand sufficiency of which Executive acknowledges, Executive, on Executive’s own behalf and on behalf of Executive’s agents,administrators, representatives, executors, successors, heirs, devisees and assigns (collectively, the “Executive Releasing Parties”)hereby fully and forever waives, releases, extinguishes and discharges the Company, HD Vest their shareholders, their affiliates,subsidiaries and each of their respective past, present and future parents, owners, officers, directors, shareholders, members, executives,employees, consultants, independent contractors, partners, agents, attorneys, advisers, insurers, fiduciaries, employee benefit plans,representatives, successors and assigns (each, a “Company Released Party” and collectively, the “Company Released Parties”), jointlyand severally, from any and all claims, rights, demands, debts, obligations, losses, causes of action, suits, controversies, setoffs,affirmative defenses, counterclaims, third party actions, damages, penalties, costs, expenses, attorneys’ fees, liabilities and indemnitiesof any kind or nature whatsoever (collectively, the “Claims”), whether known or unknown, suspected or unsuspected, accrued orunaccrued, whether at law, equity, administrative, statutory or otherwise, and whether for injunctive relief, back pay, front pay, fringebenefits, reinstatement, reemployment, compensatory damages, punitive damages, or any other kind of damages, which any ofExecutive Releasing Parties have, had or may have against any of the Company Released Parties relating to or arising out of any matterarising on or before the date this Agreement isSEPARATION AND RELEASE AGREEMENT Page 2executed by Executive. Such released Claims include, without limitation, all Claims arising from or relating to Executive’s employmentwith the Company or the termination of that employment relationship or any circumstances related thereto, or any other matter, cause orthing whatsoever, including without limitation all Claims arising at law or equity or sounding in contract (express or implied) or tort,Claims arising by statute, common law or otherwise, Claims arising under any federal, state, county or local laws, of any jurisdiction,including Claims for wrongful discharge, libel, slander, breach of express or implied contract or implied covenant of good faith and fairdealing, Claims for alleged fraud, concealment, negligence, negligent misrepresentation, promissory estoppel, quantum meruit,intentional or negligent infliction of emotional distress, violation of public policy, and Claims for discrimination, retaliation, sexualharassment and Claims arising under any laws that prohibit age, sex, sexual orientation, race, national origin, color, disability, religion,veteran, workers’ compensation or any other form of discrimination, harassment, or retaliation, including, without limitation, Claimsunder the Age Discrimination in Employment Act of 1967, as amended, the Americans with Disabilities Act of 1990, as amended, theRehabilitation Act of 1973, Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. §1981, the Civil Rights Act of 1991, theCivil Rights Act of 1866 and/or 1871, the Equal Pay Act of 1963, the Lilly Ledbetter Fair Pay Act of 2009, the Fair Labor StandardsAct, the Employee Retirement Income Security Act of 1974, as amended, the Family and Medical Leave Act of 1993, the OccupationalSafety and Health Act, the Employee Polygraph Protection Act, the Uniformed Services Employment and Reemployment Rights Act,the Worker Adjustment and Retraining Notification Act, the Genetic Information Nondiscrimination Act, the National Labor RelationsAct, the Labor Management Relations Act, the Immigration Reform and Control Act, any statute or laws of the State of Texas (includingbut not limited to the Texas Labor Code), the State of Massachusettes (including the Fair Employment Practices Act), any other t federalor state laws, any other federal, state, local, municipal or common law whistleblower, discrimination or anti-retaliation statute law orordinance, and any other Claims arising under state or federal law, as well as any expenses, costs or attorneys’ fees. Except as requiredby law, Executive agrees that Executive will not commence, maintain, initiate, or prosecute, or cause, encourage, assist, volunteer,advise or cooperate with any other person to commence, maintain, initiate or prosecute, any action, lawsuit, proceeding, charge,petition, complaint or Claim before any court, agency or tribunal against the Company or any of the Company Released Parties arisingfrom, concerned with, or otherwise relating to, in whole or in part, Executive’s employment, the terms and conditions of Executive’semployment, or Executive’s separation from employment with the Company or any of the matters or Claims discharged and released inthis Agreement. This release shall not apply to any of the Company’s obligations under this Agreement.4. No Interference. Nothing in this Agreement or the Surviving Agreement is intended to interfere with Executive’s right toreport possible violations of federal, state or local law or regulation to any governmental or law enforcement agency or entity, or tomake other disclosures that are protected under the whistleblower provisions of federal or state law or regulation. Executive furtheracknowledges that nothing in this Agreement is intended to interfere with Executive’s right to file a claim or charge with, or testify,assist, or participate in an investigation, hearing, or proceeding conducted by, the Equal Employment Opportunity Commission(the “EEOC”), any state human rights commission, or any other government agency or entity. In making such disclosures, Executiveneed not seek prior authorization from the Company, and is not required to notify the Company of any such reports, disclosures orconduct. However, by executing this Agreement, Executive hereby waives the right to recover any damages or benefits in anyproceeding Executive may bring before the EEOC, any state human rights commission, or any other government agency or entity or inany proceeding brought by the EEOC, any state human rights commission, or any other government agency or entity on Executive’sbehalf with respect to any Claim released in this Agreement; except that Executive may receive bounty money awarded by the U.S.Securities and Exchange Commission pursuant to Section 21F of the Securities Exchange Act of 1934 or any similar provision.SEPARATION AND RELEASE AGREEMENT Page 35. Known Violations. Executive represents and warrants that Executive is not aware of any illegal acts committed by or onbehalf of the Company and represents that if Executive is or had been aware of any such conduct, that Executive has properly reportedthe same to the Company’s Chief Legal Officer in writing. Executive further represents and warrants that Executive is not aware of any(i) violations, allegations or claims that the Company has violated any federal, state, local or foreign law or regulation of any kind, or(ii) any facts, basis or circumstances relating to any alleged violations, allegations or claims that the Company has violated any federal,state, local or foreign law or regulation of any kind. If Executive learns of any such information, Executive shall immediately inform theCompany’s Chief Legal Officer.6. Return of Company Property. Within three days of the Separation Date, Executive shall, to the extent not previouslyreturned or delivered, without copying or retaining any copies: (a) return all equipment, records, files, documents, data, computerprograms, programs or other materials and property in Executive’s possession which belong to the Company or any one or more of itsaffiliates, including, without limitation, all computer access codes, messaging devices, credit cards, cell phones, laptops, computers andrelated equipment, keys and access cards; and (b) deliver all original and copies of The Company Confidential Information, notes,materials, records, reports, plans, data or other documents, files or programs (whether stored in paper form, computer form, digitalform, electronically or otherwise or on Executive’s personal computer or any other media) that relate or refer to (1) the Company or anyone or more of its affiliates, or (2) the Company’s or any one or more of its affiliates’ financial information, financial data, financialstatements, personnel information, business information, strategies, sales, customers, suppliers, The Company Confidential Informationor similar information. Should Executive later discover additional items described or referenced in subsections (a) or (b) above,Executive will promptly notify the Company and return/deliver such items to the Company.7. Surviving Agreement. Executive and the Company agree that the provisions in Exhibit A to the Employment Agreement,Supplementary Terms of Employment – Chief Executive Officer, H.D. Vest, Inc. (“Surviving Agreement”), shall survive the terminationof Executive’s employment and this Agreement and shall remain in full force and effect as set forth therein except as hereby amended:“11. Non-Competition:(a)For a period of two (2) years following the Separation Date, Executive shall not, within the United States andCanada, accept employment with or provide services for any entity whose business is or which takes steps toestablish a business that will be, or engage in any activities that are, competitive with the Company’s business.For purposes of this paragraph 11, ‘the Company’s business’ shall mean (a) preparation and tax preparation-related products and services provided to consumers and small businesses, and to or through tax professionals;(b) investment and insurance products or services, and related advice and brokerage services, provided to orthrough tax professionals or in conjunction with tax preparation services, and (c) providing tax advice, enablingthe provision of tax advice or using tax relationships or data to inform or enable the provision of investingadvice and guidance.(b)For a period of two (2) years following the Separation Date, Executive shall not work with or for, or provide anyservices for, whether paid or unpaid, Lightyear, Genstar, and Stone Point, and any entity that advises or sponsorsFirst Global, Cetera or Kestra.SEPARATION AND RELEASE AGREEMENT Page 4(c)For a period of two (2) years following the Separation Date, Executive shall seek and obtain the Company’sapproval to provide any consulting services, whether paid or unpaid, to or for any person or entity.”“12. Non-Solicitation: For a period of two (2) years following the Separation Date, on Executive’s own behalf or onbehalf of any other person or entity, Executive shall not solicit, induce or attempt to influence directly or indirectly anyemployee of the Company to work for Executive or any other person or entity for whom Executive works or intends towork, not shall Executive solicit, induce or attempt to influence directly or indirectly any customer, business partner,supplier or vendor of the Company to terminate his/her/its business relationship with the Company.”8. Non-Disparagement. Executive agrees that the Company’s goodwill and reputation are assets of great value to theCompany which have been obtained and maintained through great costs, time and effort. Therefore, Executive shall not in any waydisparage, libel or defame the Company, its business or business practices, its products or services, or its shareholders, managers,officers, directors, employees, investors or affiliates. The rights afforded the Company under this provision are in addition to any and allrights and remedies otherwise afforded by law. Nothing in this Section 8 is intended to interfere with Executive’s rights in Section 4.9. Neutral Reference. The Company agrees to provide a neutral reference regarding Executive’s employment with theCompany and HD Vest. The Company shall state only Executive’s position, compensation, separation date and that Executive left theCompany to pursue other opportunities.10. Cooperation. As a further material inducement to the Company to provide Executive the consideration provided for inSection 2 and subject to Section 4, Executive agrees (A) to cooperate and provide reasonable assistance, at the request of the Company,in the transitioning of Executive’s job duties and responsibilities, (B) to be reasonably available to the Company or its representatives(including attorneys) to provide general advice or assistance as requested by the Company, and (C) to cooperate and providereasonable assistance, at the request of the Company, in any and all investigations or other legal, equitable or business matters orproceedings which involve any matters for which Executive worked on or had responsibility during Executive’s employment with theCompany. This includes but is not limited to testifying (and preparing to testify) as a witness in any proceeding or otherwise providinginformation or reasonable assistance to the Company in connection with any investigation, claim or suit, and cooperating with theCompany regarding any investigation, litigation, claims or other disputed items involving the Company that relate to matters within theknowledge or responsibility of Executive. Specifically, Executive agrees (i) to meet with the Company’s representatives, its counsel orother designees at reasonable times and places with respect to any items within the scope of this provision; (ii) to provide truthfultestimony regarding the same to any court, agency or other adjudicatory body; (iii) to provide the Company with immediate notice ofcontact or subpoena by any non-governmental party; and (iv) to not voluntarily assist any non-governmental adverse party or suchnon-governmental adverse party’s representatives. Executive acknowledges and understands that Executive’s obligations ofcooperation under this Section 10 are not limited in time and may include, but shall not be limited to, the need for or availability fortestimony. Executive shall receive no additional compensation for time spent assisting the Company pursuant to this Section 10 otherthan the compensation and benefits provided for in this Agreement, provided that Executive shall be entitled to be reimbursed for anyreasonable out-of-pocket expenses incurred in fulfilling Executive’s obligations pursuant to subsections (i) and (ii) above. Nothing inthis Section 10 is intended to interfere with Executive’s rights in Section 4.SEPARATION AND RELEASE AGREEMENT Page 511. No Assignment of Claims. Executive represents that Executive has not transferred or assigned, to any person or entity,any claim involving the Company or the Released Parties, or any portion thereof or interest therein. The Parties acknowledge and agreethat nothing in this Agreement shall prohibit payment of any amounts due to Executive under this Agreement to Executive’s estate orlegal guardian.12. Binding Effect of Agreement. This Agreement shall be binding upon and shall inure to the benefit of the Parties and theirrespective successors, assigns, executors, administrators, heirs and estates. The Released Parties are third-party beneficiaries of thisAgreement.13. Controlling Law and Venue. This Agreement shall in all respects be interpreted, enforced, and governed under the lawsof the State of Texas, without regard to any conflict of law principles. The Company and Executive agree that the language in thisAgreement shall, in all cases, be construed as a whole, according to its fair meaning, and not strictly for, or against, either of the Parties.The Parties agree that the Arbitration provisions in Section V of the Surviving Agreement shall govern any dispute regarding thisAgreement, the Surviving Agreement and any other claim or dispute between Executive and the Company or HD Vest. Venue of anyclaim or dispute that is not covered by the Arbitration provisions in Section V of the Surviving Agreement shall be in a state districtcourt of competent jurisdiction in Dallas County, Texas, or the United States District Court for the Northern District of Texas.14. Severability. Should any provision of this Agreement be declared or determined to be illegal or invalid by anygovernment agency or court of competent jurisdiction, the validity of the remaining parts, terms or provisions of this Agreement shallnot be affected and such provisions shall remain in full force and effect. Upon any finding by any government agency or court ofcompetent jurisdiction that Section 3 above is illegal or invalid, Executive agrees to execute a valid and enforceable general release.15. Breach of Agreement. In the event Executive breaches any portion, or challenges the enforceability, of this Agreement,Executive shall pay the Company (i) an amount equal to all Moving/Commuting Expenses the Company paid on Executive’s behalf orreimbursed to Executive, (ii) all attorneys’ fees, expenses and costs the Company incurs in such action, and (iii) any and all otherdamages to which the Company may be entitled at law or in equity as a result of a breach of this Agreement.16. Knowing and Voluntary Waiver. Executive acknowledges that Executive has had an opportunity to review all aspects ofthis Agreement, the Company is advising and has advised Executive in writing (i.e., through this Agreement) to consult with anattorney of Executive’s own choosing at Executive’s cost, regarding the effect of this Agreement, and Executive has had a reasonableopportunity to do so, if so desired. Executive understands it is Executive’s choice whether or not to enter into this Agreement and thatExecutive’s decision to do so is voluntary and is made knowingly. Executive acknowledges and understands that this Agreementspecifically releases and waives all rights and claims Executive may have under the Age Discrimination in Employment Act (“ADEA”)prior to the date on which Executive signs this Agreement. Furthermore, Executive acknowledges that the promises and benefitsprovided for in Section 2 of this Agreement will be delayed until this Agreement becomes effective, enforceable and irrevocable.17. Time for Consideration. Executive has knowingly and voluntarily entered into this Agreement, and acknowledges thatExecutive has been given a period of 21 days from the date Executive received this Agreement to review and consider this Agreementbefore executing it. Executive understands that Executive has the right to use as much or as little of the 21 day period as Executivewishes before executing this Agreement. Accordingly, Executive understands Executive may execute this Agreement as soon asExecutive wishes to execute it within the 21 day period. The signed Agreement must be returned to the Company, ATTN: Ann Bruder,6333 State Hwy 161, 6th floor, Irving, TX 75038, before the end ofSEPARATION AND RELEASE AGREEMENT Page 6such 21 day period. Executive further understands that Executive may revoke this his agreement to release claims under the ADEA,within seven days after signing this Agreement, in which case the consideration provided for in Section 2 of this Agreement shall benull and void, and Executive shall fully repay to the Company all Moving/Commuting Expenses as set forth in Exhibit C of theEmployment Agreement within 30 days after the Separation Date. Revocation is only effective if Executive delivers a written notice ofrevocation to the Company, ATTN: Ann Bruder, 6333 State Hwy 161, 6th floor, Irving, TX 75038, within seven days after executingthe Agreement.18. No Admission of Liability. This Agreement shall not in any way be construed as an admission by the Company orExecutive of any acts of wrongdoing or violation of any statute, law, or legal right. Rather, the Parties specifically deny and disclaimthat either has any liability to the other, but are willing to enter this Agreement at this time to definitely resolve once and forever thismatter and to avoid the costs, expense, and delay of litigation.19. Entire Agreement. This Agreement and the Surviving Agreement constitute the entire agreement and understandingbetween the Parties with respect to the subject matter hereof, and fully supersede all prior and contemporaneous negotiations,understandings, representations, writings, discussions and/or agreements between the Parties, whether oral or written, pertaining to orconcerning the subject matter of this Agreement, including the Employment Agreement. No oral statements or other prior writtenmaterial not specifically incorporated into this Agreement, except for the Surviving Agreements, shall be of any force and effect, and nochanges in or additions to this Agreement shall be recognized, unless incorporated into this Agreement by written amendment, suchamendment to become effective on the date stipulated in it. Any amendment to this Agreement must be signed by all Parties to thisAgreement.20. Disclaimer of Reliance. Except for the specific representations expressly made by the Company in this Agreement,Executive specifically disclaims that Executive is relying upon or has relied upon on any communications, promises, statements,inducements, or representation(s) that may have been made, oral or written, regarding the subject matter of this Agreement. The Partiesrepresent that they are relying solely and only on their own judgment in entering into this Agreement.21. No Waiver. Failure of the Company to exercise and/or delay in exercising any right, power or privilege in this Agreementor the Surviving Agreements shall not operate as a waiver. No waiver of the Company’s rights hereunder shall be effective unless it isin writing and signed by the Company. The Company’s waiver of any provision of the Agreement or the Surviving Agreement shall notconstitute (i) a continuing waiver of that provision, or (ii) a waiver of any other provision of this Agreement. Furthermore, no waiver ofany breach of any provision shall be deemed to be a waiver of any preceding or succeeding breach of the same or any other provision.22. Counterparts. This Agreement may be executed by the Parties in multiple counterparts, whether or not all signatoriesappear on these counterparts (including via electronic signatures and exchange of PDF documents via email), each of which shall bedeemed an original, but all of which together shall constitute one and the same instrument.[Remainder of Page Intentionally Left Blank]SEPARATION AND RELEASE AGREEMENT Page 7PLEASE READ CAREFULLY – THIS AGREEMENT INCLUDES A RELEASE OF CLAIMS, INCLUDING A RELEASE OFCLAIMS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT. BEFORE SIGNING THIS AGREEMENT, READIT, AND CAREFULLY CONSIDER IT. IF YOU CHOOSE, DISCUSS THIS AGREEMENT WITH YOUR ATTORNEY (ATYOUR OWN EXPENSE).MY SIGNATURE BELOW MEANS THAT I HAVE READ THIS AGREEMENT AND AGREE AND CONSENT TO ALL THETERMS AND CONDITIONS CONTAINED IN THIS AGREEMENT.ACCEPTED AND AGREED TO BY:EXECUTIVE/s/ Robert D. Oros ROBERT D. OROS October 28, 2018 _________DateBLUCORA, INC.By: /s/Ann J. Bruder Title: Chief Legal Officer Date: October 28, 2018 H.D. VEST, INC.By: Scott Rawlins Title: President Date: October 28, 2018 Exhibit 10.51Blucora Director Tax-Smart Deferral PlanEffective January 1, 2019h:\rick\forms\variable.doc--Blucora Director Tax-Smart Deferral PlanTABLE OF CONTENTSPageARTICLE 1DEFINITIONS 1ARTICLE 2ELIGIBILITY, ENROLLMENT, AND PARTICIPATION 72.1 Eligibility 72.2 Enrollment Requirements 72.3 Commencement of Participation 7ARTICLE 3DEFERRAL COMMITMENTS/VESTING/CREDITING 83.1 Minimum Deferrals 83.2 Maximum Deferral 83.3 Deferral of Annual Equity Grant 93.4 Election to Defer; Effect of Election Form 93.5 Withholding and Crediting of Annual Deferral Amounts 93.6 Vesting 93.7 Crediting/Debiting of Account Balances 10ARTICLE 4IN-SERVICE SCHEDULED DISTRIBUTION 114.1 In-Service Scheduled Distribution 114.2 Other Benefits Take Precedence Over In-Service ScheduledDistributions 124.3 Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies 12ARTICLE 5TERMINATION BENEFIT 125.1 Termination Benefit 125.2 Payment of Termination Benefit 13ARTICLE 6DISABILITY WAIVER AND BENEFIT 146.1 Disability Benefit 146.2 Deferral Following Disability 14ARTICLE 7SURVIVOR BENEFIT 147.1 Survivor Benefit 14--Blucora Director Tax-Smart Deferral Plan7.2 Payment of Survivor Benefit 14ARTICLE 8BENEFICIARY DESIGNATION 158.1 Beneficiary 158.2 Beneficiary Designation; Change; Spousal Consent 158.3 Acknowledgment 158.4 No Beneficiary Designation 158.5 Doubt as to Beneficiary 158.6 Discharge of Obligations 15ARTICLE 9TERMINATION, AMENDMENT OR MODIFICATION 169.1 Termination 169.2 Amendment 169.3 Effect of Payment 16ARTICLE 10ADMINISTRATION 1610.1 Committee Duties 1610.2 Administration of the Plan 1710.3 Administration Upon Change In Control 1710.4 Agents 1810.5 Binding Effect of Decisions 1810.6 Indemnity of Committee 1810.7 Company Information 1810.8 Reliance Upon Information 18ARTICLE 11OTHER BENEFITS AND AGREEMENTS 1911.1 Coordination with Other Benefits 19ARTICLE 12CLAIMS PROCEDURES 1912.1 Presentation of Claim 1912.2 Notification of Decision 1912.3 Review of a Denied Claim 2012.4 Decision on Review 2012.5 Legal Action 20ARTICLE 13TRUST 2113.1 Establishment of the Trust 21--Blucora Director Tax-Smart Deferral Plan13.2 Interrelationship of the Plan and the Trust 2113.3 Distributions From the Trust 2113.4 Participants’ Rights under the Trust 21ARTICLE 14MISCELLANEOUS 2114.1 Status of Plan 2114.2 Limitation of Rights 2114.3 Nonalienation of Benefits 2214.4 Unsecured General Creditor 2214.5 Waiver 2214.6 Company’s Liability 2214.7 Nonassignability 2214.8 Not a Contract of Service 2314.9 Furnishing Information 2314.10 Terms 2314.11 Captions 2314.12 Governing Law 2314.13 Notice 2314.14 Successors 2414.15 Spouse's Interest 2414.16 Validity 2414.17 Incompetent 2414.18 Court Order 2414.19 Distribution in the Event of Income Inclusion Under Code Section409A or Other Taxation 2514.20 Insurance 2514.21 Legal Fees To Enforce Rights After Change in Control 25--Blucora Director Tax-Smart Deferral PlanBLUCORA DIRECTOR TAX-SMART DEFERRAL PLANEffective January 1, 2019Blucora, Inc., a Delaware corporation (the “Company”) desires to adopt this Blucora Director Tax-Smart Deferral Plan (the“Plan”), effective as of January 1, 2019 (the “Effective Date”), to provide benefits in the form of unfunded deferred compensation toDirectors (as defined below).PurposeThe purpose of the Plan is to provide specified benefits to Directors who contribute materially to the continued growth,development and future business success of the Company and its subsidiaries, if any, that are participating employers in this Plan. Theprovisions of this Plan shall be interpreted in accordance with the requirements of Code section 409A and the Final TreasuryRegulations thereunder, it being the intent of the parties that the Plan shall be in compliance with the requirements of said Code sectionand said Regulations.ARTICLE 1 DefinitionsFor the purposes of this Plan, unless otherwise clearly apparent from the context, the following phrases or terms shall have thefollowing indicated meanings:1.1“Account Balance” shall mean, with respect to a Participant, a credit on the records of the Company equal to the balance ofsuch Participant’s Deferral Account. The Account Balance, and each other specified account balance, shall be a bookkeepingentry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to aParticipant, or his or her designated Beneficiary, pursuant to this Plan.1.2“Annual Deferral Amount” shall mean that portion of a Participant's Director Fees and/or Annual Equity Grant that aParticipant defers in accordance with Article 3 for any one Plan Year. In the event of a Participant's Disability, death or aSeparation from Service prior to the end of a Plan Year, such year's Annual Deferral Amount shall be the actual amountwithheld prior to such event.1.3“Annual Equity Grant” means the annual grant of Restricted Stock Units made to the Directors during each Plan Yearpursuant to the Equity Incentive Plan. For the avoidance of doubt, the term “Annual Equity Grant” does not include the initialgrant of Restricted Stock Units made to new Directors.1.4“Annual Installment Method” shall be an annual installment payment over the number of years selected by the Participant inaccordance with this Plan, calculated as follows: (i) for the first annual installment, the Participant’s Account Balance shall becalculated as of the close of business on or around the date on which the Participant’s Benefit Distribution Date, and (ii) forremaining annual installments, the Participant’s Account Balance shall be calculated on every applicable anniversary of suchBenefit Distribution Date. Each annual installment shall be calculated by multiplying this balance by a fraction, the numeratorof which is one and the denominator of which is the remaining number of annual payments due the Participant; provided that,all installment payments made with respect a deferred Annual Equity Grant shall be made in whole Shares, rounded down tothe next whole Share (other than the last installment). By way of example, if the Participant elects a ten (10) year AnnualInstallment Method, the first payment shall be 1/10 of the Account Balance, calculated as described in this definition. Thefollowing year, the payment shall be 1/9 of the vested Account Balance, calculated as described in this definition. For purposesof this Plan, the right to receive a benefit payment in annual installments shall be treated as the entitlement to a single payment.1.5“Beneficiary” shall mean one or more persons, trusts, estates or other entities, designated in accordance with Article 8, that areentitled to receive benefits under this Plan upon the death of a Participant.1.6“Beneficiary Designation Form” shall mean the form established from time to time by the Committee that a Participantcompletes signs and returns to the Committee to designate one or more Beneficiaries.1.7“Benefit Distribution Date” shall mean the date upon which all or an objectively determinable portion of a Participant’svested benefits will become eligible for distribution.1.8“Board” shall mean the board of directors of the Company.1.9“Change in Control” shall mean the occurrence of any of the following events:(a)an acquisition by any Entity of beneficial ownership (within the meaning of Rule 13d-3 promulgated under theExchange Act) of forty percent (40%) or more of either (1) the number of then outstanding shares of common stock ofthe Company (the “Outstanding Company Common Stock”) or (2) the combined voting power of the thenoutstanding voting securities of the Company entitled to vote generally in the election of directors (the “OutstandingCompany Voting Securities”), provided, however, that the following acquisitions shall not constitute a Change inControl: (i) any acquisition directly from the Company, other than an acquisition by virtue of the exercise of aconversion privilege where the security being so converted was not acquired directly from the Company by the partyexercising the conversion privilege, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefitplan (or related trust) sponsored or maintained by the Company or any Related Company, or (iv) an acquisition by anyEntity pursuant to a transaction that meets the conditions of clauses (A), (B) and (C) set forth in Section 1.9(c) below;(b)a change in the composition of the Board during any two-year period such that the individuals who, as of the beginningof such two-year period, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least amajority of the Board; provided, however, that for purposes of this definition, any individual who becomes a member ofthe Board subsequent to the beginning of the two-year period, whose election, or nomination for election by theCompany’s stockholders, was approved by a vote of at least a majority of those individuals who are members of theBoard and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall beconsidered as though such individual were a member of the Incumbent Board; and provided further, however, that anysuch individual whose initial assumption of office occurs as a result of or in connection with an actual or threatenedelection contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies orconsents by or on behalf of an Entity other than the Board shall not be considered a member of the Incumbent Board; or(c)the consummation of (i) a merger or consolidation of the Company with or into any other company; (ii) a sale in onetransaction or a series of transactions undertaken with a common purpose of all of the Company’s outstanding votingsecurities; or (iii) a sale, lease, exchange or other transfer in one transaction or a series of related transactions undertakenwith a common purpose of all or substantially all of the Company’s assets; excluding, however, in each case, atransaction pursuant to which:(A)the Entities who are the beneficial owners of the Outstanding Company Common Stock and OutstandingCompany Voting Securities immediately prior to such transaction will beneficially own, directly or indirectly, atleast fifty percent (50%) of the outstanding shares of common stock, and the combined voting power of the thenoutstanding voting securities entitled to vote generally in the election of directors, of the Successor Company insubstantially the same proportions as their ownership, immediately prior to such transaction, of the OutstandingCompany Common Stock and Outstanding Company Voting Securities;(B)no Entity (other than the Company, any employee benefit plan (or related trust) of the Company, a RelatedCompany or a Successor Company) will beneficially own, directly or indirectly, forty percent (40%) or more of,respectively, the outstanding shares of common stock of the Successor Company or the combined voting powerof the outstanding voting securities of the Successor Company entitled to vote generally in the election ofdirectors unless such ownership resulted solely from ownership of securities of the Company prior to thetransaction; and(C)individuals who were members of the Incumbent Board will immediately after the consummation of thetransaction constitute at least a majority of the members of the board of directors of the Successor Company.Where a series of transactions undertaken with a common purpose is deemed to be a transaction described in thisSection 1.9(c), the effective date of such transaction shall be the date on which the last of such transactions isconsummated.Notwithstanding the foregoing provisions of this “Change in Control” definition, to the extent necessary to comply withSection 409A of the Code, an event shall not constitute a “Change in Control” for purposes of the Plan, unless such event alsoconstitutes a change in the Company’s ownership, its effective control or the ownership of a substantial portion of its assetswithin the meaning of Section 409A of the Code.1.10“Claim” shall mean any claim, liability or obligation of any nature, arising out of or relating to this Plan or an alleged breach ofthis Plan or Election Form.1.11“Claimant” shall have the meaning set forth in Section 12.1 below.1.12“Code” shall mean the Internal Revenue Code of 1986, as it may be amended from time to time, and the regulations and otherauthority issued thereunder by the appropriate governmental authority. References herein to any Code section shall includereferences to any successor Code section or provision.1.13“Committee” shall mean the committee described in Article 10.1.14“Company” shall mean Blucora, Inc., a Delaware corporation, and any successor to all or substantially all of the Company’sassets or business.1.15“Deferral Account” shall mean (i) the sum of all of a Participant's Annual Deferral Amounts, plus (ii) amounts credited ordebited to the Participant’s Deferral Account in accordance with this Plan, less (iii) all distributions made to the Participant orhis or her Beneficiary pursuant to this Plan that relate to his or her Deferral Account.1.16“Director” shall mean any non-Employee member of the Board.1.17“Director Fees” shall mean the annual fees paid by Company, including retainer fees and meetings fees, as compensation forserving on its Board.1.18“Disability” or “Disabled” shall mean that a Participant has incurred a Total and Permanent Disability (as such term is definedin the Equity Incentive Plan as of the Effective Date), provided that, such term meets the definition of “disability” provided forunder Section 409A of the Code and the Treasury Regulations or other guidance issued thereunder.1.19“Disability Benefit” shall mean the benefit set forth in Article 6.1.20“Effective Date” shall mean January 1, 2019.1.21“Election Form” shall mean the form established from time to time by the Committee that a Participant completes, signs andreturns to the Committee to make an election under the Plan.1.22“Employee” shall mean a person who is an employee of any Employer.1.23“Employer(s)” shall be defined as follows:(a)Except as otherwise provided in part (b) of this Section, the term “Employer” shall mean (i) the Company; (ii) any of itssubsidiaries (now in existence or hereafter formed or acquired); and/or (iii) an entity that would be aggregated andtreated as a single employer with the Company under Code section 414(b) (controlled group of corporations) or Codesection 414(c) (a group of trades or businesses, whether or not incorporated, under common control).(b)For the purpose of determining whether a Participant has experienced a Separation from Service, the term “Employer”shall mean:(i)The entity for which the Participant performs services and with respect to which the legally binding right tocompensation deferred or contributed under this Plan arises; and(ii)All other entities with which the entity described above would be aggregated and treated as a single employerunder Code section 414(b) (controlled group of corporations) and Code section 414(c) (a group of trades orbusinesses, whether or not incorporated, under common control), as applicable. In order to identify the group ofentities described in the preceding sentence, the Committee shall use an ownership threshold of at least 50% as asubstitute for the 80% minimum ownership threshold that appears in, and otherwise must be used whenapplying, the applicable provisions of (A) Code section 1563 for determining a controlled group of corporationsunder Code section 414(b), and (B) Treas. Reg. §1.414(c)-2 for determining the trades or businesses that areunder common control under Code section 414(c).1.24“Entity” shall mean any individual, entity or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of theExchange Act.1.25“Equity Incentive Plan” shall mean the Blucora, Inc. 2018 Long-Term Incentive Plan, as it may be amended from time totime.1.26“Exchange Act” shall means the United States Securities Exchange Act of 1934, as amended.1.27“In-Service Scheduled Distribution” shall mean the distribution set forth in Section 4.1 below.1.28“Insolvent” shall mean either (i) the Company is unable to pay its debts as they become due, or (ii) the Company is subject to apending proceeding as a debtor in the United States Bankruptcy Code.1.29“Parent Company” means a company or other entity which as a result of a Change in Control owns the Company or all orsubstantially all of the Company’s assets either directly or through one or more subsidiaries.1.30“Participant” shall mean any Director who submits an executed Election Form and Beneficiary Designation Form, which areaccepted by the Committee.1.31“Plan” shall mean the Blucora Director Tax-Smart Deferral Plan, which shall be evidenced by this instrument, as it may beamended from time to time, and by any other documents that together with this instrument define a Participant’s rights toamounts credited to his or her Account Balance.1.32“Plan Year” shall mean a period beginning on January 1 of each calendar year and continuing through December 31 of suchcalendar year.1.33“Related Company” means any subsidiary of the Company or any other entity that is directly or indirectly controlled by, incontrol of, or under common control with the Company, including, without limitation, any Employer.1.34“Restricted Stock Unit” shall mean a “Restricted Stock Unit” as defined in the Equity Incentive Plan.1.35“Separation from Service” shall mean a termination of services provided by a Participant to the Company, whethervoluntarily or involuntarily, other than by reason of death or Disability, as determined by the Committee in accordance withTreas. Reg. §1.409A-1(h). In determining whether a Participant has experienced a Separation from Service, the followingprovisions shall apply:(a)For a Participant who provides services as a Director, except as otherwise provided in part (b) of this Section, aSeparation from Service shall occur upon the Director’s cessation of services as a Director.(b)If a Participant provides services for an Employer as both an Employee and as a Director, to the extent permitted byTreas. Reg. §1.409A-1(h)(5) the services provided by such Participant as a Director shall not be taken into account indetermining whether the Participant has experienced a Separation from Service as an Employee, and the servicesprovided by such Participant as an Employee shall not be taken into account in determining whether the Participant hasexperienced a Separation from Service as a Director.1.36“Shares” shall mean the shares of common stock of the Company, par value $0.0001 per share, which the Company isauthorized to issue, or any securities into which or for which the common stock of the Company may be converted orexchanged, as the case may be.1.37“Specified Employee” shall mean any Participant who is determined to be a “key employee” (as defined under Code section416(i) without regard to paragraph (5) thereof) for the applicable period, as determined annually by the Committee inaccordance with Treas. Reg. §1.409A-1(i). In determining whether a Participant is a Specified Employee, the followingprovisions shall apply:(a)The Committee’s identification of the individuals who fall within the definition of “key employee” under Code section416(i) (without regard to paragraph (5) thereof) shall be based upon the 12-month period ending on each December 31st(referred to below as the “identification date”). In applying the applicable provisions of Code section 416(i) to identifysuch individuals, “compensation” shall be determined in accordance with Treas. Reg. §1.415(c)-2(a) without regard to(i) any safe harbor provided in Treas. Reg. §1.415(c)-2(d), (ii) any of the special timing rules provided in Treas. Reg.§1.415(c)-2(e), and (iii) any of the special rules provided in Treas. Reg. §1.415(c)-2(g); and(b)Each Participant who is among the individuals identified as a “key employee” in accordance with part (a) of thisSection 1.37 shall be treated as a Specified Employee for purposes of this Plan if such Participant experiences aSeparation from Service during the 12-month period that begins on the April 1st following the applicable identificationdate.1.38“Successor Company” means the surviving company, the successor company or Parent Company, as applicable, inconnection with a Change in Control.1.39“Survivor Benefit” shall mean the benefit set forth in Article 7.1.40“Termination Benefit” shall mean the benefit set forth in Article 5.1.41“Trust” shall mean one or more trusts established by the Company in accordance with Article 13.1.42“Trustee” shall mean the duly appointed and acting trustee of the Trust, and any successor thereto.1.43“Unforeseeable Financial Emergency” shall mean a severe financial hardship of the Participant resulting from (a) an illnessor accident of the Participant, the Participant’s spouse, the Participant’s Beneficiary or the Participant’s dependent (as defined inCode section 152 without regard to paragraphs (b)(1), (b)(2) and (d)(1)(b) thereof), (b) a loss of the Participant’s property dueto casualty, or (c) such other similar extraordinary and unforeseeable circumstances arising as a result of events beyond thecontrol of the Participant, all as determined by the Committee based on the relevant facts and circumstances. The circumstancesthat will constitute an unforeseeable emergency will depend upon the facts of each case, but an Unforeseeable FinancialEmergency shall not be deemed to exist to the extent that such hardship is or may be relieved:(a)Through reimbursement or compensation by insurance or otherwise;(b)By liquidation of the Participant’s assets, to the extent the liquidation of such assets would not itself cause severefinancial hardship;(c)By cessation of deferrals under this Plan or elective contributions made by the Participant under any 401(k) plan orother deferred compensation plan;(d)Distributions or nontaxable loans from any other employer’s plans to the extent eligible;(e)Loans from commercial sources at reasonable commercial terms;(f)Bank or other savings accounts; or(g)Reasonable, periodic payment arrangements with a creditor.By way of example, the need to send a Participant’s child to college or the desire to purchase or improve a home is notconsidered an Unforeseeable Financial Emergency.1.44“Year of Service” shall mean each year of continuous service by the Participant as a Director with the Company.ARTICLE 2 Eligibility, Enrollment, and Participation2.1Eligibility. Participation in the Plan shall be limited to the Directors of the Company.2.2Enrollment Requirements. As a condition to participation, each Director shall complete, execute and return to theCommittee, an Election Form and a Beneficiary Designation Form, all by the deadline(s) established by the Committee inaccordance with the applicable provisions of the Plan. In addition, the Committee shall establish from time to time such otherenrollment requirements as it determines in its sole discretion are necessary.2.3Commencement of Participation. Provided a Director has met all enrollment requirements set forth in this Plan and requiredby the Committee, including returning all required documents to the Committee within the specified time periods set forth in thePlan, that Director shall commence participation in the Plan on the first day of the month following the month in which theDirector completes all enrollment requirements. If a Director fails to meet all such requirements within the periods required, inaccordance with the provisions of the Plan, that Director shall not be eligible to participate in the Plan until the first day of thePlan Year following the delivery to and acceptance by the Committee of the required documents.ARTICLE 3 Deferral Commitments/Vesting/Crediting3.1Minimum Deferrals.(a)Annual Deferral Amount. For each Plan Year, a Participant may elect to defer, as his or her Annual DeferralAmount, Director Fees and the Annual Equity Grant in the following minimum amount or percentage, as applicable,for each deferral elected:DeferralMinimum AmountDirector Fees$10,000 aggregateAnnual Equity Grant20% (rounded up to the nearestwhole Share)If an election is made for less than the stated minimum amounts, or if no election is made, the amount deferred shall bezero.(b)Short Plan Year. Notwithstanding the foregoing, if a Participant first becomes a Participant after the first day of a PlanYear the minimum Annual Deferral Amount for Director Fees shall be an amount equal to the minimum set forthabove, multiplied by a fraction, the numerator of which is the number of complete months remaining in the Plan Yearand the denominator of which is 12. No deferral of the Annual Equity Grant is permitted for a Plan Year on or after thefirst day of such Plan Year.3.2Maximum Deferral.(a)Annual Deferral Amount. For each Plan Year, a Participant may elect to defer, as his or her Annual DeferralAmount, Director Fees and the Annual Equity Grant in the following maximum percentages, as applicable, for eachdeferral elected:DeferralMaximum PercentageDirector Fees100%Annual Equity Grant100% (rounded up to the nearestwhole Share)(b)Short Plan Year. Notwithstanding the foregoing, if a Participant first becomes a Participant after the first day of a PlanYear, then to the extent required by Section 3.4 and Code section 409A and related Treasury Regulations, themaximum amount of the Participant’s Director Fees that may be deferred by the Participant for the Plan Year shall bedetermined by applying the percentages set forth in Section 3.2(a) to the portion of such compensation attributable toservices performed after the date that the Participant’s deferral election is made. No deferral of the Annual Equity Grantis permitted for a Plan Year on or after the first day of such Plan Year.3.3Deferral of Annual Equity Grant. For each Plan Year, a Participant may elect to defer, as his or her Annual DeferralAmount, a portion of the Annual Equity Grant to be granted during such Plan Year, in the percentages as set forth above inSection 3.1 and Section 3.2. If any portion of an Annual Equity Grant is deferred pursuant to this Plan, then notwithstandinganything to contrary in the award agreement for such Annual Equity Grant, the Shares to be delivered upon the conversion ofthe Restricted Stock Units underlying the portion of the Annual Equity Grant that has been deferred, shall be withheld anddelivered to the Participant on the Benefit Distribution Date designated by the Participant.3.4Election to Defer; Effect of Election Form.(a)First Plan Year. A Director who first becomes eligible to participate in the Plan on or after the beginning of a PlanYear, as determined in accordance with Treas. Reg. §1.409A-2(a)(7)(ii) and the “plan aggregation” rules provided inTreas. Reg. §1.409A-1(c)(2), may be permitted to make an election to defer the portion of the Director Fees (but not theAnnual Equity Grant) attributable to services to be performed after such election, provided that the Participant submitsan Election Form on or before the deadline established by the Committee, which in no event shall be later than 30 daysafter the Participant first becomes eligible to participate in the Plan. Any deferral election made in accordance with thisSection 3.4(a) shall become irrevocable no later than the 30th day after the date the Director becomes eligible toparticipate in the Plan.(b)Subsequent Plan Years. For each succeeding Plan Year, the Participant’s prior election shall remain in effect unlessthe Participant makes a subsequent irrevocable deferral election for such succeeding Plan Year, by timely delivering anew Election Form to the Committee, in accordance with its rules and procedures, before the December 31 precedingthe Plan Year for which the election is made. If no such Election Form is timely delivered for a Plan Year, the AnnualDeferral Amount shall be the same amount as elected for the immediately prior Plan Year.3.5Withholding and Crediting of Annual Deferral Amounts. For each Plan Year, (a) the Director Fees portion of the AnnualDeferral Amount shall be withheld at the time the Director Fees are or otherwise would be paid to the Participant, whether ornot this occurs during the Plan Year itself, and (b) the Annual Equity Grant portion of the Annual Deferral Amount shall bewithheld at the time such Annual Equity Grant is made by the Company to the Participant, provided that, the Shares underlyingthe portion of such Annual Equity Grant shall be withheld at the time the Restricted Stock Units underlying the Annual EquityGrant become vested. Annual Deferral Amounts shall be credited to a Participant’s Deferral Account at the time such amountswould otherwise have been paid to the Participant.3.6Vesting. A Participant shall at all times be 100% vested in his or her Deferral Account; provided that, the portion of theDeferral Account that relates to any Annual Equity Grant that has been deferred shall be subject to the vesting conditionsotherwise applicable to such Annual Equity Grant.3.7Crediting/Debiting of Account Balances. In accordance with, and subject to, the rules and procedures that are establishedfrom time to time by the Committee, in its sole discretion, with respect to a Participant’s Account Balance relating to thedeferred Director Fees (but not the Annual Equity Grant), amounts shall be credited or debited to a Participant's AccountBalance in accordance with the following rules:(a)Measurement Funds. The Participant may elect one or more of the measurement funds selected by the Committee, inits sole discretion, which are based on certain mutual funds or such other financial measures as selected by theCommittee in its sole discretion (the “Measurement Funds”), for the purpose of crediting or debiting additionalamounts to his or her Account Balance. As necessary, the Committee may, in its sole discretion, discontinue, substituteor add a Measurement Fund. Each such action will take effect as of the first day of the first calendar quarter that beginsat least 30 days after the day on which the Committee gives Participants advance written notice of such change.(b)Election of Measurement Funds. A Participant, in connection with his or her initial deferral election in accordancewith Section 3.4(a) above, shall elect, on the Election Form, one or more Measurement Fund(s) (as described in Section3.7(a) above) to be used to determine the amounts to be credited or debited to his or her Account Balance. If aParticipant does not elect any of the Measurement Funds as described in the previous sentence, the Participant’sAccount Balance shall automatically be allocated into the lowest-risk Measurement Fund, as determined by theCommittee, in its sole discretion. The Participant may (but is not required to) elect, by submitting an Election Form tothe Committee that is accepted by the Committee, to add or delete one or more Measurement Fund(s) to be used todetermine the amounts to be credited or debited to his or her Account Balance, or to change the portion of his or herAccount Balance allocated to each previously or newly elected Measurement Fund. If an election is made inaccordance with the previous sentence, it shall apply as of the first business day deemed reasonably practicable by theCommittee, in its sole discretion, and shall continue thereafter for each subsequent day in which the Participantparticipates in the Plan, unless changed in accordance with the previous sentence. Notwithstanding the foregoing, allinvestments hereunder shall be considered assets of the Company, and the Participant shall remain subject to allapplicable provisions of the Plan, including, without limitation, Sections 13.4 and 14.2 below. Each Participant, as acondition to his or her participation in the Plan, agrees to indemnify and hold harmless the Committee, the Company,and each Employer, and their representatives, delegates and agents, from and against any investment losses or otherdamages of any kind relating to the deemed investment of the Participant’s Account Balance under the Plan. Noassurances are provided by any person or entity that any investment results of any Measurement Fund will be favorableand, as with most investments, there is a risk of loss.(c)Proportionate Allocation. In making any election described in Section 3.7(b) above, the Participant shall specify onthe Election Form, in increments of one percent (1%), the percentage of his or her Account Balance to be allocated to aMeasurement Fund (as if the Participant was making an investment in that Measurement Fund with that portion of hisor her Account Balance).(d)Crediting or Debiting Method. The performance of each Measurement Fund (either positive or negative) will bedetermined by the Committee, in its sole discretion on a daily basis based on the manner in which such Participant’sAccount Balance has been hypothetically allocated among the Measurement Funds by the Participant.(e)No Actual Investment. Notwithstanding any other provision of this Plan that may be interpreted to the contrary, theMeasurement Funds are to be used for measurement purposes only, and a Participant's election of any suchMeasurement Fund, the allocation of his or her Account Balance thereto, the calculation of additional amounts and thecrediting or debiting of such amounts to a Participant's Account Balance shall not be considered or construed in anymanner as an actual investment of his or her Account Balance in any such Measurement Fund. In the event that theCompany or the Trustee, in its own discretion, decides to invest funds in any or all of the investments on which theMeasurement Funds are based, no Participant shall have any rights in or to such investments themselves. Withoutlimiting the foregoing, a Participant's Account Balance shall at all times be a bookkeeping entry only and shall notrepresent any investment made on his or her behalf by the Company or the Trust; the Participant shall at all timesremain an unsecured creditor of the Company.ARTICLE 4 In-Service Scheduled Distribution4.1In-Service Scheduled Distribution. In connection with each election to defer an Annual Deferral Amount, a Participant mayirrevocably elect to receive an In-Service Scheduled Distribution from the Plan with respect to all or a portion of the AnnualDeferral Amount. The In-Service Scheduled Distribution shall be a lump sum payment of cash and/or Shares (if an AnnualEquity Grant has been deferred) in an amount (and/or number of Shares) that is equal to the portion of the Annual DeferralAmount that the Participant elected to have distributed as an In-Service Scheduled Distribution, plus amounts credited ordebited in the manner provided in Section 3.7 above to that amount, calculated as of the close of business on or around theBenefit Distribution Date designated by the Participant in accordance with this Section 4.1 (a “Scheduled Distribution”). TheBenefit Distribution Date for an amount subject to an In-Service Scheduled Distribution election shall be the first day of anyPlan Year designated by the Participant, which may be no sooner than 3 Plan Years after the end of the Plan Year in which theAnnual Deferral Amount is actually deferred. The Participant may elect different Benefit Distribution Dates for Deferred Feesand Annual Equity Grants deferred with respect to different Plan Years. Subject to the other terms and conditions of this Plan,each In-Service Scheduled Distribution elected shall be paid out during a 60-day period commencing immediately after theBenefit Distribution Date. By way of example, if an In-Service Scheduled Distribution is elected for Annual Deferral Amountsthat are deferred in the Plan Year commencing January 1, 2019, the earliest Benefit Distribution Date that may be designatedby a Participant would be January 1, 2023, and the In-Service Scheduled Distribution would be paid out during the 60-dayperiod commencing immediately after such Benefit Distribution Date.4.2Other Benefits Take Precedence Over In-Service Scheduled Distributions. Should an event occur prior to any BenefitDistribution Date designated for a Scheduled Distribution that triggers a benefit under Articles 5, 6, or 7, any Annual DeferralAmount, plus amounts credited or debited thereon, that are subject to an In-Service Scheduled Distribution election underSection 4.1 above shall not be paid in accordance with Section 4.1 above, but shall be paid in accordance with the otherapplicable Article.4.3Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies.(a)If the Participant experiences an Unforeseeable Financial Emergency prior to the occurrence of a distribution eventunder Articles 5, 6, or 7, the Participant may petition the Committee to suspend deferrals of Director Fees required to bemade by such Participant, to the extent deemed necessary by the Committee to satisfy the Unforeseeable FinancialEmergency. If suspension of deferrals is not sufficient to satisfy the Participant’s Unforeseeable Financial Emergency,the Participant may further petition the Committee to receive a partial or full payout from the Plan. The Participant shallonly receive a payout from the Plan to the extent such payout is deemed necessary by the Committee to satisfy theParticipant’s Unforeseeable Financial Emergency.(b)The payout shall not exceed the lesser of (i) the Participant's vested Account Balance, calculated as of the close ofbusiness on or around the Benefit Distribution Date for such payout, as determined by the Committee in accordancewith the provisions set forth below, or (ii) the amount reasonably needed to satisfy the Unforeseeable FinancialEmergency, plus amounts necessary to pay Federal, state, or local income taxes or penalties reasonably anticipated as aresult of the distribution.(c)If the Committee, in its sole discretion, approves a Participant’s petition for suspension, the Participant’s deferrals underthis Plan shall be suspended as of the date of such approval. If the Committee, in its sole discretion, approves aParticipant’s petition for suspension and payout, the Participant’s deferrals under this Plan shall be suspended as of thedate of such approval and the Participant’s Benefit Distribution Date for such payout shall be the date on which suchCommittee approval occurs, and such payout shall be distributed to the Participant in a lump sum no later than 60 daysafter such Benefit Distribution Date.ARTICLE 5 Termination Benefit5.1Termination Benefit. A Participant who experiences a Separation from Service shall receive, as a Termination Benefit, his orher vested Account Balance in either a lump sum payment of cash and/or Shares (if an Annual Equity Grant has been deferred)or annual installment payments of cash and/or Shares (if applicable), as elected by the Participant in accordance with Section5.2. A Participant’s Termination Benefit shall be calculated as of the close of business on or around the applicable BenefitDistribution Date for such benefit. The Benefit Distribution Date shall be (i) the first day after the end of the six-month periodimmediately following the date on which the Participant experiences a Separation from Service, if the Participant is a SpecifiedEmployee, and (ii) for all other Participants, the date on which the Participant experiences a Separation from Service; provided,however, if a Participant changes the form of distribution for the Termination Benefit in accordance with Section 5.2(b), theBenefit Distribution Date for the Termination Benefit shall be determined in accordance with Section 5.2(b). Notwithstandingthe foregoing and notwithstanding anything an Election Form to the contrary, if a Participant experiences a Separation fromService prior to the completion of 5 Years of Service with the Company, then such Participant’s Termination Benefit shall bepaid in a lump sum on the Benefit Distribution Date, without regard to any change in form of distribution made in accordancewith Section 5.2(b).5.2Payment of Termination Benefit.(a)A Participant, in connection with his or her commencement of participation in the Plan, shall elect on an Election Formto receive the Termination Benefit upon Separation from Service in a lump sum payment of cash and/or Shares (if anAnnual Equity Grant has been deferred) or pursuant to an Annual Installment Method of up to 15 years. If a Participantdoes not make any election with respect to the payment of the Termination Benefit, then such benefit shall be payablein a lump sum.(b)A Participant may change the form of payment for the Termination Benefit by submitting an Election Form to theCommittee in accordance with the following criteria:(i)The election shall not take effect until at least 12 months after the date on which the election is made;(ii)The new Benefit Distribution Date for the Participant’s Termination Benefit upon Separation from Service shallbe 5 years after the Benefit Distribution Date that would otherwise have been applicable to such benefit; and(iii)The election must be made at least 12 months prior to the Benefit Distribution Date that would otherwise havebeen applicable to the Participant’s Termination Benefit upon Separation from Service.For purposes of applying the provisions of this Section 5.2(b), a Participant’s election to change the form of paymentfor the Termination Benefit upon Separation from Service shall not be considered to be made until the date on whichthe election becomes irrevocable. Such an election shall become irrevocable no later than the date that is 12 monthsprior to the Benefit Distribution Date that would otherwise have been applicable to the Participant’s TerminationBenefit upon Separation from Service. Subject to the requirements of this Section 5.2(b), the Election Form mostrecently accepted by the Committee that has become effective shall govern the form of payout of the Participant’sTermination Benefit.(c)The lump sum payment shall be made, or installment payments shall commence, in cash and/or Shares (as applicable),no later than 60 days after the Participant’s Benefit Distribution Date. Remaining installments, if any, shall be paid nolater than 60 days after each anniversary of the Participant’s Benefit Distribution Date.(d)Notwithstanding anything to the contrary contained herein, the Company may distribute a Participant’s AccountBalance if, at any time after such Participant’s Separation from Service, the Account Balance does not exceed the limitin Code section 402(g)(1)(B) and such distribution would result in the termination of the Participant’s entire interest inthe Plan as provided under Code section 409A.ARTICLE 6 Disability Waiver and Benefit6.1Disability Benefit. A Participant who experiences a Disability, shall receive, as a Disability Benefit his or her vested AccountBalance, calculated as of the close of business on or around the Benefit Distribution Date for such benefit. The BenefitDistribution Date shall be the date that the Committee determines that such Participant is Disabled within the meaning ofSection 1.18; provided, however, if the Participant experienced a Separation from Service prior to the date he or she wasDisabled, then the Benefit Distribution Date shall be determined in accordance with Section 5.1 above, as applicable (and theParticipant shall receive a Termination Benefit and not a Disability Benefit). A Participant, in connection with his or hercommencement of participation in the Plan, shall elect on an Election Form to receive the Disability Benefit in a lump sumpayment of cash and/or Shares (if an Annual Equity Grant has been deferred) or pursuant to an Annual Installment Method ofup to 15 years. If a Participant does not make any election with respect to the payment of the Disability Benefit, then suchbenefit shall be payable in a lump sum. The lump sum payment shall be made, or installment payments shall commence, nolater than 60 days after the Disabled Participant’s Benefit Distribution Date, and any remaining installments, if any, shall bepaid no later than 60 days after each anniversary of the Disabled Participant’s Benefit Distribution Date.6.2Deferral Following Disability. If a Participant returns to service as a Director after a Disability ceases, the Participant mayelect to defer an Annual Deferral Amount for the Plan Year following his or her return to service and for every Plan Yearthereafter while a Participant in the Plan; provided such deferral elections are otherwise allowed and an Election Form isdelivered to and accepted by the Committee for each such election in accordance with Section 3.4(b) above.ARTICLE 7 Survivor Benefit7.1Survivor Benefit. In the event of a Participant’s death prior to the complete distribution of his or her vested Account Balance,the Participant's Beneficiary(ies) shall receive a Survivor Benefit which will be equal to the Participant's unpaid vested AccountBalance, calculated as of the close of business on or around the Benefit Distribution Date for such benefit. The BenefitDistribution Date shall be the date on which the Committee is provided with proof that is satisfactory to the Committee of theParticipant’s death.7.2Payment of Survivor Benefit. The Survivor Benefit shall be paid to the Participant’s Beneficiary(ies) in a lump sum paymentof cash and/or Shares (if an Annual Equity Grant has been deferred) no later than 60 days after the Participant’s BenefitDistribution Date.ARTICLE 8 Beneficiary Designation8.1Beneficiary. Each Participant shall have the right, at any time, to designate his or her Beneficiary(ies) (both primary as well ascontingent) to receive any benefits payable under the Plan to a beneficiary upon the death of a Participant. The Beneficiarydesignated under this Plan may be the same as or different from the Beneficiary designation under any other plan of theCompany or any Employer in which the Participant participates.8.2Beneficiary Designation; Change; Spousal Consent. A Participant shall designate his or her Beneficiary by completing andsigning the Beneficiary Designation Form, and returning it to the Committee or its designated agent. A Participant shall havethe right to change a Beneficiary by completing, signing and otherwise complying with the terms of the BeneficiaryDesignation Form and the Committee's rules and procedures, as in effect from time to time. If the Participant names someoneother than his or her spouse as a Beneficiary, spousal consent in writing to the designation of a different Beneficiary is requiredto be provided in a form designated by the Committee, executed by such Participant's spouse and returned to the Committee. ABeneficiary designation that has received spousal consent cannot be changed without spousal consent. Upon the acceptance bythe Committee of a new Beneficiary Designation Form, all Beneficiary designations previously filed shall be canceled. TheCommittee shall be entitled to rely on the last Beneficiary Designation Form filed by the Participant and accepted by theCommittee prior to his or her death.8.3Acknowledgment. No designation or change in designation of a Beneficiary shall be effective until received andacknowledged in writing by the Committee or its designated agent.8.4No Beneficiary Designation. If a Participant fails to designate a Beneficiary as provided in Sections 8.1, 8.2 and 8.3 above or,if all designated Beneficiaries predecease the Participant or die prior to complete distribution of the Participant's benefits, thenthe Participant's designated Beneficiary shall be deemed to be his or her surviving spouse. If the Participant has no survivingspouse, the benefits remaining under the Plan to be paid to a Beneficiary shall be payable to the executor or personalrepresentative of the Participant's estate.8.5Doubt as to Beneficiary. If the Committee has any doubt as to the proper Beneficiary to receive payments pursuant to thisPlan, the Committee shall have the right, exercisable in its discretion, to either (i) cause the Company to withhold suchpayments until this matter is resolved to the Committee's satisfaction or (ii) direct that the amount be paid into any court ofcompetent jurisdiction in an interpleader action, and such payment shall be a full and complete discharge of any liability orobligation under the Plan or Trust Agreement to the full extent of such payment.8.6Discharge of Obligations. The payment of benefits under the Plan to a Beneficiary shall fully and completely discharge theCompany (and all Employers) and the Committee from all further obligations under this Plan with respect to the Participant.ARTICLE 9 Termination, Amendment or Modification9.1Termination. Although the Company anticipates that it will continue the Plan for an indefinite period of time, there is noguarantee that the Company will continue the Plan or will not terminate the Plan at any time in the future. Accordingly, theCompany reserves the right to discontinue its sponsorship of the Plan and the Company reserves the right to terminate the Planat any time with respect to any or all of its participating Directors, by action of its Board. However, after the Plan terminationthe Account Balances of such Participants shall continue to be credited with Annual Deferral Amounts attributable to a deferralelection that was in effect prior to the Plan termination to the extent deemed necessary to comply with Code section 409A andrelated Treasury Regulations, and additional amounts shall continue to credited or debited to such Participants’ AccountBalances pursuant to Section 3.7. The Measurement Funds available to Participants following the termination of the Plan shallbe comparable in number and type to those Measurement Funds available to Participants in the Plan Year preceding the PlanYear in which the Plan termination is effective. In addition, following a Plan termination, Participant Account Balances shallremain in the Plan and shall not be distributed until such amounts become eligible for distribution in accordance with the otherapplicable provisions of the Plan. Notwithstanding the preceding sentence, to the extent permitted by Treas. Reg. §1.409A-3(j)(4)(ix), the Company may provide that upon termination of the Plan, all Account Balances of the Participants shall bedistributed, subject to and in accordance with any rules established by the Company deemed necessary to comply with theapplicable requirements and limitations of Treas. Reg. §1.409A-3(j)(4)(ix).9.2Amendment. The Company may, at any time, amend or modify the Plan in whole or in part by the action of its Board;provided, however, that: (i) no amendment or modification shall be effective to decrease or restrict the value of a Participant'sAccount Balance in existence at the time the amendment or modification is made, and (ii) no amendment or modification of thisSection 9.2 or Section 10.3 below shall be effective. Notwithstanding the foregoing provisions of this Section 9.2, by writteninstrument, the Plan may be amended by the Company at any time prior to a Change in Control to conform the Plan to theprovisions and requirements of any applicable law. No such amendment described in the immediately preceding sentence shallbe considered prejudicial to any interest of a Participant or a Beneficiary hereunder.9.3Effect of Payment. The full payment of the Participant’s vested Account Balance under Articles 4, 5, 6, or 7 of the Plan shallcompletely discharge all obligations to a Participant and his or her designated Beneficiaries under this Plan shall terminate.ARTICLE 10 Administration10.1Committee Duties. Except as otherwise provided in this Article 10, this Plan shall be administered by a Committee, whichshall consist of the Board of the Company, or such committee as the Board of the Company shall appoint. The Board of theCompany may remove or replace any member of a committee appointed by the Board of the Company at any time in its solediscretion. Members of the Committee may be Participants under this Plan. Any individual serving on the Committee who is aParticipant shall abstain from any discussion and vote, and shall not otherwise act on any matter relating directly to himself orherself. When making a determination or calculation, the Committee shall be entitled to rely on information furnished by aParticipant or the Company. The members of the Committee shall not receive any special compensation for serving in theircapacities as members of the Committee, but shall be reimbursed by the Company for any reasonable expenses incurred inconnection therewith. No bond or other security need be required of the Committee or any member thereof.10.2Administration of the Plan. The Committee shall operate, administer, interpret, construe, and construct the Plan, includingwithout limitation, the sole discretion and authority to (i) make, amend, interpret and enforce all appropriate rules andregulations for the administration of this Plan and (ii) decide or resolve any and all questions as may arise in connection withthe Plan, including correcting any defect, supplying any omission, or reconciling any inconsistency. The Committee shall haveall powers necessary or appropriate to implement and administer the terms and provisions of the Plan, including the power tomake findings of fact.10.3Administration Upon Change In Control. For purposes of this Plan, the Committee shall be the “Administrator” at all timesprior to the occurrence of a Change in Control Within 120 days following a Change in Control, an independent third party“Administrator” may be selected by the individual who, immediately prior to the Change in Control, was the Company’sChairman of the Board or, if not so identified, the Chairman of the Board’s Nominating and Governance Committee (the “Ex-Director”), and approved by the Trustee. The Committee, as constituted prior to the Change in Control, shall continue to bethe Administrator until the earlier of (i) the date on which such independent third party is selected and approved, or (ii) theexpiration of the 120-day period following the Change in Control. If an independent third party is not selected within 120 daysof such Change in Control, the Committee, as described in Section 10.1 above, shall be the Administrator. The Administratorshall have the discretionary power to determine all questions arising in connection with the administration of the Plan and theinterpretation of the Plan and Trust including, but not limited to benefit entitlement determinations; provided, however, uponand after the occurrence of a Change in Control, the Administrator shall have no power to direct the investment of Plan or Trustassets or select any investment manager or custodial firm for the Plan or Trust. Upon and after the occurrence of a Change inControl, the Company must: (1) pay all reasonable administrative expenses and fees of the Administrator; (2) indemnify theAdministrator against any costs, expenses and liabilities including, without limitation, attorney’s fees and expenses arising inconnection with the performance of the Administrator hereunder, except with respect to matters resulting from the grossnegligence or willful misconduct of the Administrator or its employees or agents; and (3) supply full and timely information tothe Administrator on all matters relating to the Plan, the Trust, the Participants and their Beneficiaries, the Account Balances ofthe Participants, the date and circumstances of the Disability, death or Separation from Service of the Participants, and suchother pertinent information as the Administrator may reasonably require. Upon and after a Change in Control, theAdministrator may be terminated (and a replacement appointed) by the Trustee only with the approval of the Ex-Director.Upon and after a Change in Control, the Administrator may not be terminated by the Company.10.4Agents. In the administration of this Plan, the Committee may, from time to time, employ agents and delegate to them suchadministrative duties as it sees fit (including acting through a duly appointed representative).10.5Binding Effect of Decisions. The determination of the Committee as to the proper interpretation, construction, or application ofany term or provision in the Plan and the rules and regulations promulgated hereunder shall be final, binding, and conclusivewith respect to all interested parties.10.6Indemnity of Committee. To the full extent permitted by applicable law, the Company and each Employer shall individuallyand collectively indemnify and hold harmless each past, present, and future member of the Committee, any Employee to whomthe duties of the Committee may be delegated, and the Administrator against any and all claims, losses, damages, judgments,settlements, costs, expenses or liabilities (and all actions in respect thereof and any legal or other costs and expenses in givingtestimony or furnishing documents in response to a subpoena or otherwise) arising from any action or failure to act with respectto this Plan, except in the case of gross negligence or willful misconduct by the Committee, any of its members, any suchEmployee or the Administrator, including the cost of investigating, preparing, or defending any pending, threatened oranticipated possible action, claim, suit or other proceeding, whether or not in connection with litigation in which theCommittee, such Employee, or the Administrator is a party. The foregoing right of indemnification shall inure to the benefit ofthe successors and assigns, and the heirs, executors, administrators and personal representatives of the Committee, any suchEmployee, and the Administrator, and shall be in addition to all other rights to which the Committee, any such Employee, andthe Administrator may be entitled as a matter of law, contract, or otherwise. The amount of indemnification during a calendaryear shall not affect the fees and expenses eligible for reimbursement in any other calendar year. Indemnification shall be madeon or before the last day of the calendar year following the calendar year in which the amounts or liabilities subject to suchindemnification were incurred.10.7Company Information. To enable the Committee and/or Administrator to perform its functions, the Company shall supply fulland timely information to the Committee and/or Administrator, as the case may be, on all matters relating to the compensationof its Participants, the date and circumstances of the Disability, death or Separation from Service of its Participants, and suchother pertinent information as the Committee or Administrator may reasonably require.10.8Reliance Upon Information. No member of the Committee shall be liable for any decision, action, omission, or mistake injudgment in connection with the administration of the Plan, provided that he acted in good faith. Without limiting the generalityof the foregoing sentence, any decision or action taken by the Committee in reasonable reliance upon information supplied to itby the Board, the Company, any Employer, legal counsel, or the Company’s independent accountants shall be deemed to havebeen taken in good faith. The Committee may from time to time consult with counsel who may be counsel to the Company orother counsel, with respect to its obligations or duties hereunder, or with respect to any action, proceeding or question of law,and shall not be held liable with respect to any action taken or omitted, in good faith, pursuant to the advice of such counsel.ARTICLE 11 Other Benefits and Agreements11.1Coordination with Other Benefits. The benefits provided for a Participant and a Participant's Beneficiary under the Plan arein addition to any other benefits available to such Participant under any other plan or program for Directors of the Company.The Plan shall supplement and shall not supersede, modify or amend any other such plan or program except as may otherwisebe expressly provided.ARTICLE 12 Claims Procedures12.1Presentation of Claim. Any Participant or Beneficiary of a deceased Participant (such Participant or Beneficiary beingreferred to below as a “Claimant”) may deliver to the Committee a written claim for a determination with respect to theamounts distributable to such Claimant from the Plan. If such a claim relates to the contents of a notice received by theClaimant, the claim must be made within 60 days after such notice was received by the Claimant. All other claims must bemade within 180 days of the date on which the event that caused the claim to arise occurred. The claim must state withparticularity the determination desired by the Claimant.12.2Notification of Decision. The Committee shall consider a Claimant's claim within a reasonable time, but no later than 90 daysafter receiving the claim. If the Committee determines that special circumstances require an extension of time for processing theclaim, written notice of the extension shall be furnished to the Claimant prior to the termination of the initial 90-day period. Inno event shall such extension exceed a period of 90 days from the end of the initial period. The extension notice shall indicatethe special circumstances requiring an extension of time and the date by which the Committee expects to render the benefitdetermination. The Committee shall notify the Claimant in writing:(a)that the Claimant's requested determination has been made, and that the claim has been allowed in full; or(b)that the Committee has reached a conclusion contrary, in whole or in part, to the Claimant's requested determination,and such notice must set forth in a manner calculated to be understood by the Claimant:(i)the specific reason(s) for the denial of the claim, or any part of it;(ii)specific reference(s) to pertinent provisions of the Plan upon which such denial was based;(iii)a description of any additional material or information necessary for the Claimant to perfect the claim, and anexplanation of why such material or information is necessary;(iv)an explanation of the claim review procedure set forth in Section 12.3 below; and(v)a statement of the Claimant’s right to bring a civil action following an adverse benefit determination on review.12.3Review of a Denied Claim. On or before 60 days after receiving a notice from the Committee that a claim has been denied, inwhole or in part, a Claimant (or the Claimant's duly authorized representative), if he or she disagrees with the claim denial, mustfile with the Committee a written request for a review of the denial of the claim. The Claimant (or the Claimant's dulyauthorized representative):(a)may, upon request and free of charge, have reasonable access to, and copies of, all documents, records and otherinformation relevant to the claim for benefits;(b)may submit written comments or other documents; and/or(c)may request a hearing, which the Committee, in its sole discretion, may grant.12.4Decision on Review. The Committee shall render its decision on review promptly, and no later than 60 days after theCommittee receives the Claimant’s written request for a review of the denial of the claim. If the Committee determines thatspecial circumstances require an extension of time for processing the claim, written notice of the extension shall be furnished tothe Claimant prior to the termination of the initial 60-day period. In no event shall such extension exceed a period of 60 daysfrom the end of the initial period. The extension notice shall indicate the special circumstances requiring an extension of timeand the date by which the Committee expects to render the benefit determination. In rendering its decision, the Committee shalltake into account all comments, documents, records and other information submitted by the Claimant relating to the claim,without regard to whether such information was submitted or considered in the initial benefit determination. The decision mustbe written in a manner calculated to be understood by the Claimant, and it must contain:(a)specific reasons for the decision;(b)specific reference(s) to the pertinent Plan provisions upon which the decision was based;(c)a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to and copies of,all documents, records and other information relevant to the Claimant’s claim for benefits; and(d)a statement of the Claimant’s right to bring a civil action.12.5Legal Action. A Claimant's compliance with the foregoing provisions of this Article 12 is a mandatory prerequisite to aClaimant's right to commence any legal action with respect to any claim for benefits under this Plan.ARTICLE 13 Trust13.1Establishment of the Trust. In order to provide assets from which to fulfill the obligations of the Participants and theirbeneficiaries under the Plan, the Company intends, pursuant to formal action by the Committee, to establish a trust by a trustagreement with a third party, the Trustee, to which the Company may, in its discretion, contribute cash or other property,including securities issued by the Company, to provide for the benefit payments under the Plan; provided, however, in theevent of a Change in Control the Company must contribute sufficient assets to any such Trust equal to the aggregate value ofall Account Balances determined as of the date of the Change in Control.13.2Interrelationship of the Plan and the Trust. The provisions of the Plan shall govern the rights of a Participant to receivedistributions pursuant to the Plan. The provisions of the Trust shall govern the rights of the Company, Participants and thecreditors of the Company to the assets transferred to the Trust. The Company shall at all times remain liable to carry out itsobligations under the Plan.13.3Distributions From the Trust. The Company’s obligations under the Plan may be satisfied with Trust assets distributedpursuant to the terms of the Trust, and any such distribution shall reduce the Company’s obligations under this Plan.13.4Participants’ Rights under the Trust. The assets of the Trust shall be held for the benefit of the Participants in accordancewith the terms of the Plan and Trust Agreement. All the assets of the Trust shall remain subject to the claims of the generalunsecured creditors of the Company, and the rights of the Participants to the assets of the Trust shall be limited as provided inthe Plan and Trust Agreement in the event that the Company becomes Insolvent.ARTICLE 14 Miscellaneous14.1Status of Plan. The Plan is intended to be a plan that is not qualified within the meaning of Code section 401(a) and is exemptfrom the requirements of Title I of the Employee Retirement Income Security Act of 1974, as amended. The Plan shall beadministered and interpreted (a) to the extent possible in a manner consistent with the intent described in the precedingsentence, and (b) in accordance with Code section 409A the Final Regulations thereunder and other related Treasury guidance.14.2Limitation of Rights. Nothing in this Plan shall be construed to:(a)Give a Participant any rights, other than as an unsecured general creditor of the Company with respect to any amountcredited to his or her Account, until such amount is actually distributed to him or her;(b)Limit in any way the right of the Company to terminate a Participant’s service;(c)Give a Participant or any other person any interest in any fund, reserve or any specific asset of the Company or anyentity under common ownership or control with the Company; or(d)Create a fiduciary relationship between the Participant and the Company.14.3Nonalienation of Benefits. No right or benefit under this Plan shall be subject to anticipation, alienation, attachment,garnishment, sale, transfer, assignment (either at law or in equity), levy, execution, pledge, encumbrance, charge, or any otherlegal or equitable process, and any attempt to do so will be void and without effect. No right or benefit hereunder shall in anymanner be liable for or subject to any debts, contracts, liabilities, engagements, or torts of the Participant or Beneficiary entitledto such benefits. The recovery under the Plan of overpayments of benefits previously made to a Participant; the transfer ofbenefit rights from the Plan to another plan; or the direct deposit of benefit payments to an account in a banking institution (ifnot actually part of an arrangement constituting an assignment or alienation), shall not be construed as an assignment oralienation for purposes of the immediately preceding paragraph. The first sentence of this Section 14.3 shall not preclude (a) theParticipant from designating a Beneficiary to receive any benefit payable hereunder upon his or her death, or (b) the executors,administrators, or other legal representatives of the Participant or his or her estate from assigning any rights hereunder to theperson or persons entitled thereto. In the event that any Participant’s or Beneficiary’s benefits hereunder are garnished orattached by order of any court, the Company or the Trustee may bring an action or a declaratory judgment in a court ofcompetent jurisdiction to determine the proper recipient of the benefits to be paid under the Plan. During the pendency of suchaction, any benefits that become payable shall be held as credits to the Participant’s Account or, if the Company prefers, paidinto the court as they become payable, to be distributed by the court to the recipient as the court deems proper at the close ofsuch action.14.4Unsecured General Creditor. Participants and their Beneficiaries, heirs, successors and assigns shall have no legal orequitable rights, interests or claims in any property or assets of the Company. For purposes of the payment of benefits underthis Plan, any and all of the Company's assets shall be, and remain, the general, unpledged unrestricted assets of the Company.The Company's obligation under the Plan shall be merely that of an unfunded and unsecured promise to pay money in thefuture.14.5Waiver. No term or condition of this Plan shall be deemed to have been waived, nor shall there be an estoppel against theenforcement of any provision of this Plan, except by written instrument of the party charged with such waiver or estoppel. Nosuch written waiver shall be deemed a continuing waiver unless specifically stated therein, and each such waiver shall operateonly as to the specific term or condition waived and shall not constitute a waiver of such term or condition for the future or as toany act other than that specifically waived. Any waiver by any party hereto of a breach of any provision of the Plan by anyother party shall not operate or be construed as a waiver by such party of any subsequent breach thereof.14.6Company’s Liability. The Company’s liability for the payment of benefits shall be defined only by the Plan. The Companyshall have no obligation to a Participant under the Plan except as expressly provided in the Plan.14.7Nonassignability. Neither a Participant nor any other person shall have any right to commute, sell, assign, transfer, pledge,anticipate, mortgage or otherwise encumber, transfer, hypothecate, alienate or convey in advance of actual receipt, the amounts,if any, payable hereunder, or any part thereof, which are, and all rights to which are expressly declared to be, unassignable andnon-transferable. No part of the amounts payable shall, prior to actual payment, be subject to seizure, attachment, garnishmentor sequestration for the payment of any debts, judgments, alimony or separate maintenance owed by a Participant or any otherperson, be transferable by operation of law in the event of a Participant's or any other person's bankruptcy or insolvency or betransferable to a spouse as a result of a property settlement or otherwise.14.8Not a Contract of Service. The terms and conditions of this Plan shall not be deemed to constitute a contract of servicebetween the Company and the Participant. Such service relationship can be terminated at any time for any reason, or no reason,with or without cause, and with or without notice, unless expressly provided in a written agreement. Nothing in this Plan shallbe deemed to give a Participant the right to be retained in the service of the Company, or to interfere with the right of theCompany to discipline or discharge the Participant at any time.14.9Furnishing Information. A Participant or his or her Beneficiary will cooperate with the Committee by furnishing any and allinformation requested by the Committee and take such other actions as may be requested in order to facilitate the administrationof the Plan and the payments of benefits hereunder, including but not limited to taking such physical examinations as theCommittee may deem necessary.14.10Terms. Whenever any words are used herein in the masculine, they shall be construed as though they were in the feminine inall cases where they would so apply; and whenever any words are used herein in the singular or in the plural, they shall beconstrued as though they were used in the plural or the singular, as the case may be, in all cases where they would so apply.14.11Captions. Headings and paragraphs of this Plan are for convenience only and shall not control or affect the meaning orconstruction of any of its provisions.14.12Governing Law. The provisions of this Plan shall be governed by, construed, and enforced in accordance with the laws of theState of Texas (excluding any conflict of laws, rule or principle of Texas law that might refer the governance, construction, orinterpretation of this Plan to the laws of another state). A Participant’s sole remedy for any Claim shall be against the Company,and no Participant shall have any claim or right of any nature against any Related Company of the Company or anystockholder or existing or former director, officer or Employee of the Company or any Related Company of the Company. Theindividuals and entities described above in this Section 14.12 (other than the Company) shall be third-party beneficiaries of thisPlan for purposes of enforcing the terms of this Section 14.12.14.13Notice. Any notice or filing required or permitted to be given to the Committee under this Plan shall be sufficient if in writingand hand-delivered, or sent by registered or certified mail, to the address below:Blucora, Inc.Attn: General Counsel6333 North State Highway 161, 4th FloorIrving, Texas 75038 Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on thepostmark on the receipt for registration or certification.Any notice or filing required or permitted to be given to a Participant under this Plan shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known address of the Participant.14.14Successors. The provisions of this Plan shall bind and inure to the benefit of the Company and its successors and assigns andthe Participant and the Participant's designated Beneficiaries.14.15Spouse's Interest. The interest in the benefits hereunder of a spouse of a Participant who has predeceased the Participant shallautomatically pass to the Participant and shall not be transferable by such spouse in any manner, including but not limited tosuch spouse's will, nor shall such interest pass under the laws of interstate succession.14.16Validity. In case any provision of this Plan shall be illegal or invalid for any reason, said illegality or invalidity shall not affectthe remaining parts hereof, but this Plan shall be construed and enforced as if such illegal or invalid provision had never beeninserted herein.14.17Incompetent. If the Committee determines in its discretion that a benefit under this Plan is to be paid to a minor, a persondeclared incompetent or to a person incapable of handling the disposition of that person's property, the Committee may directpayment of such benefit to the guardian, legal representative or person having the care and custody of such minor, incompetentor incapable person. The Committee may require proof of minority, incompetence, incapacity or guardianship, as it may deemappropriate prior to distribution of the benefit. Any payment of a benefit shall be a payment for the account of the Participantand the Participant's Beneficiary, as the case may be, and shall be a complete discharge of any liability under the Plan for suchpayment amount.14.18Court Order. The Committee is authorized to make any payments directed by court order in any action in which the Plan orthe Committee has been named as a party. In addition, if a court determines that a spouse or former spouse of a Participant hasan interest in the Participant’s benefits under the Plan in connection with a property settlement or otherwise, the Committee, inits sole discretion, shall have the right, notwithstanding any election made by a Participant, to immediately distribute thespouse's or former spouse's interest in the Participant’s benefits under the Plan to that spouse or former spouse.14.19Distribution in the Event of Income Inclusion Under Code Section 409A or Other Taxation.(a)Code Section 409A. If any portion of a Participant’s Account Balance under this Plan is required to be included inincome by the Participant prior to receipt due to a failure of this Plan to comply with the requirements of Code section409A and related Treasury Regulations, the Committee may determine that such Participant shall receive a distributionfrom the Plan in an amount equal to the lesser of (i) the portion of his or her Account Balance required to be included inincome as a result of the failure of the Plan to comply with the requirements of Code section 409A and related TreasuryRegulations, or (ii) the unpaid Account Balance.(b)Trust. If the Trust terminates in accordance with its terms and benefits are distributed from the Trust to a Participant inaccordance therewith, the Participant's benefits under this Plan shall be reduced to the extent of such distributions;provided, however, that such distributions may not occur, if they otherwise would violate Code section 409A and therelated Treasury Regulations.14.20Insurance. The Company, on its own behalf or on behalf of the Trustee of the Trust, and, in their sole discretion, may applyfor and procure insurance on the life of the Participant, in such amounts and in such forms as the Trust may choose. TheCompany or the Trustee of the Trust, as the case may be, shall be the sole owner and beneficiary of any such insurance. TheParticipant shall have no interest whatsoever in any such policy or policies, and at the request of the Company shall submit tomedical examinations and supply such information and execute such documents as may be required by the insurance companyor companies to whom the Company has applied for insurance.14.21Legal Fees To Enforce Rights After Change in Control. The Company is aware that upon the occurrence of a Change inControl, the Board of the Company (which might then be composed of new members) or a stockholder of the Company, or ofany Successor Company might then cause or attempt to cause the Company or such successor to refuse to comply with itsobligations under the Plan and might cause or attempt to cause the Company to institute, or may institute, litigation seeking todeny Participants the benefits intended under the Plan. In these circumstances, the purpose of the Plan could be frustrated.Accordingly, if, following a Change in Control, it should appear to any Participant that the Company or any SuccessorCompany has failed to comply with any of its obligations under the Plan or any agreement thereunder or, if the Company orany other person takes any action to declare the Plan void or unenforceable or institutes any litigation or other legal actiondesigned to deny, diminish or to recover from any Participant the benefits intended to be provided, then the Companyirrevocably authorizes such Participant to retain counsel of his or her choice at the expense of the Company to represent suchParticipant in connection with the initiation or defense of any litigation or other legal action, whether by or against theCompany, or any director, officer, stockholder or other person affiliated with the Company or any successor thereto in anyjurisdiction. The amount of fees and expenses eligible for reimbursement during a calendar year shall not affect the fees andexpenses eligible for reimbursement in any other calendar year. Reimbursement of eligible fees and expenses shall be made onor before the last day of the calendar year following the calendar year in which the fees or expenses were incurred.* * * * * * * *[Remainder of Page Intentionally Left Blank.Signature Page Follows.] --Blucora Director Tax-Smart Deferral PlanIN WITNESS WHEREOF, the Company has signed this Plan document as of December 13, 2018, to be effective as of theEffective Date.CompanyBlucora, Inc.,a Delaware corporationBy:/s/ John S. Clendening Name: John S. Clendening Title: President and CEO 4845-6968-8192 v.3 Signature Page to the Blucora Director Tax-Smart Deferral Plan Exhibit 10.52Blucora Executive Tax-Smart Deferral PlanEffective January 1, 2019h:\rick\forms\variable.doc--Blucora Executive Tax-Smart Deferral PlanTABLE OF CONTENTSPageARTICLE 1DEFINITIONS 1ARTICLE 2SELECTION, ENROLLMENT, AND ELIGIBILITY 92.1 Selection by Committee 92.2 Enrollment Requirements 92.3 Eligibility; Commencement of Participation 92.4 Termination of Participation and/or Deferrals 9ARTICLE 3DEFERRAL COMMITMENTS/COMPANY CONTRIBUTIONAMOUNTS/VESTING/CREDITING/TAXES 103.1 Minimum Deferrals 103.2 Maximum Deferral 103.3 Election to Defer; Effect of Election Form 103.4 Withholding and Crediting of Annual Deferral Amounts 113.5 Company Contribution Amount 113.6 Vesting 123.7 Crediting/Debiting of Account Balances 123.8 FICA and Other Taxes 13ARTICLE 4IN-SERVICE SCHEDULED DISTRIBUTION; UNFORESEEABLE FINANCIAL EMERGENCIES;WITHDRAWAL ELECTION 144.1 In-Service Scheduled Distribution 144.2 Other Benefits Take Precedence Over In-Service Scheduled Distributions 154.3 Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies 15ARTICLE 5RETIREMENT BENEFIT 155.1 Retirement Benefit 155.2 Payment of Retirement Benefit 16ARTICLE 6TERMINATION BENEFIT 176.1 Termination Benefit 17--Blucora Tax-Smart Executive Deferral Plan6.2 Payment of Termination Benefit 17ARTICLE 7DISABILITY WAIVER AND BENEFIT 177.1 Disability Benefit 177.2 Deferral Following Disability 17ARTICLE 8SURVIVOR BENEFIT 188.1 Survivor Benefit 188.2 Payment of Survivor Benefit 18ARTICLE 9BENEFICIARY DESIGNATION 189.1 Beneficiary 189.2 Beneficiary Designation; Change; Spousal Consent 189.3 Acknowledgment 189.4 No Beneficiary Designation 189.5 Doubt as to Beneficiary 199.6 Discharge of Obligations 19ARTICLE 10LEAVE OF ABSENCE 1910.1 Paid Leave of Absence 1910.2 Unpaid Leave of Absence 19ARTICLE 11TERMINATION, AMENDMENT OR MODIFICATION 1911.1 Termination 1911.2 Amendment 2011.3 Effect of Payment 20ARTICLE 12ADMINISTRATION 2012.1 Committee Duties 2012.2 Administration of the Plan 2112.3 Administration Upon Change In Control 2112.4 Agents 2212.5 Binding Effect of Decisions 2212.6 Indemnity of Committee 2212.7 Employer Information 2212.8 Reliance Upon Information 22ARTICLE 13OTHER BENEFITS AND AGREEMENTS 23--Blucora Tax-Smart Executive Deferral Plan13.1 Coordination with Other Benefits 23ARTICLE 14CLAIMS PROCEDURES 2314.1 Presentation of Claim 2314.2 Notification of Decision 2314.3 Review of a Denied Claim 2414.4 Decision on Review 2414.5 Legal Action 25ARTICLE 15TRUST 2515.1 Establishment of the Trust 2515.2 Interrelationship of the Plan and the Trust 2515.3 Distributions From the Trust 2515.4 Participants’ Rights under the Trust 25ARTICLE 16MISCELLANEOUS 2516.1 Status of Plan 2516.2 Limitation of Rights 2616.3 Nonalienation of Benefits 2616.4 Unsecured General Creditor 2616.5 Waiver 2716.6 Employer's Liability 2716.7 Nonassignability 2716.8 Not a Contract of Employment 2716.9 Furnishing Information 2716.10 Terms 2716.11 Captions 2716.12 Governing Law 2816.13 Notice 2816.14 Successors 2816.15 Spouse's Interest 2816.16 Validity 2816.17 Incompetent 28--Blucora Tax-Smart Executive Deferral Plan16.18 Court Order 2916.19 Distribution in the Event of Income Inclusion Under Code Section 409A or Other Taxation 2916.20 Insurance 2916.21 Legal Fees To Enforce Rights After Change in Control 2916.22 Formal Action by an Employer 30BLUCORA TAX-SMART EXECUTIVE DEFERRAL PLANEffective January 1, 2019Blucora, Inc., a Delaware corporation (the “Company”) and each other Employer, desires to adopt this Blucora Tax-SmartExecutive Deferral Plan (the “Plan”), effective as of January 1, 2019 (the “Effective Date”), to provide benefits in the form ofunfunded deferred compensation to a select group of management and highly compensated Employees who contribute materially to thecontinued growth, development and business success of the Company and the Employers.PurposeThe purpose of the Plan is to provide specified benefits to a select group of management or highly compensated Employeeswho contribute materially to the continued growth, development and future business success of the Company and its subsidiaries, ifany, that are participating employers in this Plan. The provisions of this Plan shall be interpreted in accordance with the requirements ofCode section 409A and the Final Treasury Regulations thereunder, it being the intent of the parties that the Plan shall be in compliancewith the requirements of said Code section and said Regulations.ARTICLE 1 DefinitionsFor the purposes of this Plan, unless otherwise clearly apparent from the context, the following phrases or terms shall have thefollowing indicated meanings:1.1“Account Balance” shall mean, with respect to a Participant, a credit on the records of the Employer equal to the sum of (i) theDeferral Account balance, and (ii) the Company Contribution Account balance. The Account Balance, and each otherspecified account balance, shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement anddetermination of the amounts to be paid to a Participant, or his or her designated Beneficiary, pursuant to this Plan.1.2“Annual Bonus” shall mean any compensation, in addition to Incentive Bonus and Base Salary, payable to a Participantduring a Plan Year, under any Employer's annual bonus and cash incentive plans. The Administrator, in its sole discretion,shall determine whether any particular type or item of compensation shall be deemed an “Annual Bonus” for purposes of thePlan.1.3“Annual Deferral Amount” shall mean that portion of a Participant's Base Salary, Annual Bonus, and Incentive Bonus that aParticipant defers in accordance with Article 3 for any one Plan Year. In the event of a Participant's Disability, death or aSeparation from Service prior to the end of a Plan Year, such year's Annual Deferral Amount shall be the actual amountwithheld prior to such event.1.4“Annual Installment Method” shall be an annual installment payment over the number of years selected by the Participant inaccordance with this Plan, calculated as follows: (i) for the first annual installment, the Participant’s vested Account Balanceshall be calculated as of the close of business on or around the date on which the Participant’s Benefit Distribution Date, and(ii) for remaining annual installments, the Participant’s vested Account Balance shall be calculated on every applicableanniversary of such Benefit Distribution Date. Each annual installment shall be calculated by multiplying this balance by afraction, the numerator of which is one and the denominator of which is the remaining number of annual payments due theParticipant. By way of example, if the Participant elects a ten (10) year Annual Installment Method, the first payment shall be1/10 of the vested Account Balance, calculated as described in this definition. The following year, the payment shall be 1/9 ofthe vested Account Balance, calculated as described in this definition. For purposes of this Plan, the right to receive a benefitpayment in annual installments shall be treated as the entitlement to a single payment.1.5“Base Salary” shall mean the annual cash compensation relating to services performed during any calendar year as reportableon the Employee’s form W-2, excluding distributions from nonqualified deferred compensation plans, bonuses, commissions,overtime, fringe benefits, stock options, relocation expenses, incentive payments, non-monetary awards, director fees and otherfees, and automobile and other allowances paid to a Participant for employment services rendered (whether or not suchallowances are included in the Employee’s gross income). Base Salary shall be calculated before reduction for payroll taxesand for compensation voluntarily deferred or contributed by the Participant pursuant to all qualified or nonqualified plans ofany Employer and shall be calculated to include amounts not otherwise included in the Participant's gross income under Codesections 125, 132(f)(4), 402(e)(3), 402(h), or 403(b) pursuant to plans established by any Employer; provided, however, that allsuch amounts will be included in compensation only to the extent that had there been no such plan, the amount would havebeen payable in cash to the Employee.1.6“Beneficiary” shall mean one or more persons, trusts, estates or other entities, designated in accordance with Article 9, that areentitled to receive benefits under this Plan upon the death of a Participant.1.7“Beneficiary Designation Form” shall mean the form established from time to time by the Committee that a Participantcompletes signs and returns to the Committee to designate one or more Beneficiaries.1.8“Benefit Distribution Date” shall mean the date upon which all or an objectively determinable portion of a Participant’svested benefits will become eligible for distribution.1.9“Board” shall mean the board of directors of the Company or any Employer, or such other person or group of persons referredto in Section 16.23 hereof, in the case of the Company, or any other Employer, which is not a corporation.1.10“Change in Control” shall mean the occurrence of any of the following events:(a)an acquisition by any Entity of beneficial ownership (within the meaning of Rule 13d-3 promulgated under theExchange Act) of forty percent (40%) or more of either (1) the number of then outstanding shares of common stock ofthe Company (the “Outstanding Company Common Stock”) or (2) the combined voting power of the thenoutstanding voting securities of the Company entitled to vote generally in the election of directors (the “OutstandingCompany Voting Securities”), provided, however, that the following acquisitions shall not constitute a Change inControl: (i) any acquisition directly from the Company, other than an acquisition by virtue of the exercise of aconversion privilege where the security being so converted was not acquired directly from the Company by the partyexercising the conversion privilege, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefitplan (or related trust) sponsored or maintained by the Company or any Related Company, or (iv) an acquisition by anyEntity pursuant to a transaction that meets the conditions of clauses (A), (B) and (C) set forth in Section 1.10(c) below;(b)a change in the composition of the Board during any two-year period such that the individuals who, as of the beginningof such two-year period, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least amajority of the Board; provided, however, that for purposes of this definition, any individual who becomes a member ofthe Board subsequent to the beginning of the two-year period, whose election, or nomination for election by theCompany’s stockholders, was approved by a vote of at least a majority of those individuals who are members of theBoard and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall beconsidered as though such individual were a member of the Incumbent Board; and provided further, however, that anysuch individual whose initial assumption of office occurs as a result of or in connection with an actual or threatenedelection contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies orconsents by or on behalf of an Entity other than the Board shall not be considered a member of the Incumbent Board; or(c)the consummation of (i) a merger or consolidation of the Company with or into any other company; (ii) a sale in onetransaction or a series of transactions undertaken with a common purpose of all of the Company’s outstanding votingsecurities; or (iii) a sale, lease, exchange or other transfer in one transaction or a series of related transactions undertakenwith a common purpose of all or substantially all of the Company’s assets; excluding, however, in each case, atransaction pursuant to which:(A)the Entities who are the beneficial owners of the Outstanding Company Common Stock and OutstandingCompany Voting Securities immediately prior to such transaction will beneficially own, directly or indirectly, atleast fifty percent (50%) of the outstanding shares of common stock, and the combined voting power of the thenoutstanding voting securities entitled to vote generally in the election of directors, of the Successor Company insubstantially the same proportions as their ownership, immediately prior to such transaction, of the OutstandingCompany Common Stock and Outstanding Company Voting Securities;(B)no Entity (other than the Company, any employee benefit plan (or related trust) of the Company, a RelatedCompany or a Successor Company) will beneficially own, directly or indirectly, forty percent (40%) or more of,respectively, the outstanding shares of common stock of the Successor Company or the combined voting powerof the outstanding voting securities of the Successor Company entitled to vote generally in the election ofdirectors unless such ownership resulted solely from ownership of securities of the Company prior to thetransaction; and(C)individuals who were members of the Incumbent Board will immediately after the consummation of thetransaction constitute at least a majority of the members of the board of directors of the Successor Company.Where a series of transactions undertaken with a common purpose is deemed to be a transaction described in thisSection 1.10(c), the effective date of such transaction shall be the date on which the last of such transactions isconsummated.Notwithstanding the foregoing provisions of this “Change in Control” definition, to the extent necessary to comply withSection 409A of the Code, an event shall not constitute a “Change in Control” for purposes of the Plan, unless such event alsoconstitutes a change in the Company’s ownership, its effective control or the ownership of a substantial portion of its assetswithin the meaning of Section 409A of the Code.1.11“Claim” shall mean any claim, liability or obligation of any nature, arising out of or relating to this Plan or an alleged breach ofthis Plan or Election Form.1.12“Claimant” shall have the meaning set forth in Section 14.1 below.1.13“Code” shall mean the Internal Revenue Code of 1986, as it may be amended from time to time, and the regulations and otherauthority issued thereunder by the appropriate governmental authority. References herein to any Code section shall includereferences to any successor Code section or provision.1.14“Committee” shall mean the committee described in Article 12.1.15“Company” shall mean Blucora, Inc., a Delaware corporation, and any successor to all or substantially all of the Company’sassets or business.1.16“Company Contribution Account” shall mean (i) the sum of the Participant’s Company Contribution Amounts, plus (ii)amounts credited or debited to the Participant’s Company Contribution Account in accordance with this Plan, less (iii) alldistributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to the Participant’s CompanyContribution Account.1.17“Company Contribution Amount” shall mean, for any one Plan Year, the amount determined in accordance with Section 3.5below.1.18“Deferral Account” shall mean (i) the sum of all of a Participant's Annual Deferral Amounts, plus (ii) amounts credited ordebited to the Participant’s Deferral Account in accordance with this Plan, less (iii) all distributions made to the Participant orhis or her Beneficiary pursuant to this Plan that relate to his or her Deferral Account.1.19“Disability” or “Disabled” shall mean that a Participant is determined to be disabled in accordance with the applicabledisability insurance program of such Participant’s Employer, provided that the definition of “disability” applied under suchdisability insurance program complies with the requirements of Code section 409A and provided, further, that if suchParticipant is not eligible his or her Employer’s disability insurance program, that the Participant is determined to be disabled bythe Social Security Administration.1.20“Disability Benefit” shall mean the benefit set forth in Article 7.1.21“Effective Date” shall mean January 1, 2019.1.22“Election Form” shall mean the form established from time to time by the Committee that a Participant completes, signs andreturns to the Committee to make an election under the Plan.1.23“Employee” shall mean a person who is an employee of any Employer.1.24“Employer(s)” shall be defined as follows:(a)Except as otherwise provided in part (b) of this Section, the term “Employer” shall mean (i) the Company; (ii) any of itssubsidiaries (now in existence or hereafter formed or acquired); and/or (iii) an entity that would be aggregated andtreated as a single employer with the Company under Code section 414(b) (controlled group of corporations) or Codesection 414(c) (a group of trades or businesses, whether or not incorporated, under common control).(b)For the purpose of determining whether a Participant has experienced a Separation from Service, the term “Employer”shall mean:(i)The entity for which the Participant performs services and with respect to which the legally binding right tocompensation deferred or contributed under this Plan arises; and(ii)All other entities with which the entity described above would be aggregated and treated as a single employerunder Code section 414(b) (controlled group of corporations) and Code section 414(c) (a group of trades orbusinesses, whether or not incorporated, under common control), as applicable. In order to identify the group ofentities described in the preceding sentence, the Committee shall use an ownership threshold of at least 50% as asubstitute for the 80% minimum ownership threshold that appears in, and otherwise must be used whenapplying, the applicable provisions of (A) Code section 1563 for determining a controlled group of corporationsunder Code section 414(b), and (B) Treas. Reg. §1.414(c)-2 for determining the trades or businesses that areunder common control under Code section 414(c).1.25“Entity” shall mean any individual, entity or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of theExchange Act.1.26“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as it may be amended from time to time, and theregulations and other authority issued thereunder by the appropriate governmental authority. References herein to any sectionof ERISA shall include references to any successor section or provision of ERISA.1.27“Exchange Act” shall means the United States Securities Exchange Act of 1934, as amended.1.28“Incentive Bonus” shall mean any cash compensation, in addition to Annual Bonus and Base Salary, earned by a Participantfor services rendered during a Plan Year, under any Employer's monthly, quarterly, or other bonus and cash incentive plans.The Administrator, in its sole discretion, shall determine whether any particular type or item of compensation shall be deemedan “Incentive Bonus” for purposes of the Plan.1.29“In-Service Scheduled Distribution” shall mean the distribution set forth in Section 4.1 below.1.30“Insolvent” shall mean either (i) the Employer is unable to pay its debts as they become due, or (ii) the Employer is subject to apending proceeding as a debtor in the United States Bankruptcy Code.1.31“Parent Company” means a company or other entity which as a result of a Change in Control owns the Company or all orsubstantially all of the Company’s assets either directly or through one or more subsidiaries.1.32“Participant” shall mean any Employee (i) who is selected to participate in the Plan, and (ii) who submits an executed ElectionForm and Beneficiary Designation Form, which are accepted by the Committee.1.33“Plan” shall mean the Blucora Tax-Smart Executive Deferral Plan, which shall be evidenced by this instrument, as it may beamended from time to time, and by any other documents that together with this instrument define a Participant’s rights toamounts credited to his or her Account Balance.1.34“Plan Year” shall mean a period beginning on January 1 of each calendar year and continuing through December 31 of suchcalendar year.1.35“Related Company” means any subsidiary of the Company or any other entity that is directly or indirectly controlled by, incontrol of, or under common control with the Company, including, without limitation, any Employer.1.36“Retirement” or “Retires” shall mean, with respect to a Participant, his or her Separation from Service for any reason otherthan death or Disability, on or after his or her attainment of (i) age sixty (60) and five (5) years of service with the Company orany Employer; (ii) age fifty-five (55) and ten (10) years of services with the Company or any Employer; or (iii) any age withtwenty (20) years of service with the Company or any Employer.1.37“Retirement Benefit” shall mean the benefit set forth in Article 5.1.38“Separation from Service” shall mean a termination of services provided by a Participant to his or her Employer, whethervoluntarily or involuntarily, other than by reason of death or Disability, as determined by the Committee in accordance withTreas. Reg. §1.409A-1(h). In determining whether a Participant has experienced a Separation from Service, the followingprovisions shall apply:(a) For a Participant who provides services to an Employer as an Employee, except as otherwise provided inpart (c) of this Section 1.38, a Separation from Service shall occur when such Participant has experienced a terminationof employment with such Employer. A Participant shall be considered to have experienced a termination ofemployment when the facts and circumstances indicate that the Participant and his or her Employer reasonablyanticipate that either (i) no further services will be performed for the Employer after a certain date, or (ii) that the level ofbona fide services the Participant will perform for the Employer after such date (whether as an Employee or as anindependent contractor) will permanently decrease to no more than 20% of the average level of bona fide servicesperformed by such Participant (whether as an Employee or an independent contractor) over the immediately preceding36-month period (or the full period of services to the Employer if the Participant has been providing services to theEmployer less than 36 months).If a Participant is on military leave, sick leave, or other bona fide leave of absence, the employment relationshipbetween the Participant and the Employer shall be treated as continuing intact, provided that the period of such leavedoes not exceed 6 months, or if longer, so long as the Participant retains a right to reemployment with the Employerunder an applicable statute or by contract. If the period of a military leave, sick leave, or other bona fide leave ofabsence exceeds 6 months and the Participant does not retain a right to reemployment under an applicable statute or bycontract, the employment relationship shall be considered to be terminated for purposes of this Plan as of the first dayimmediately following the end of such 6-month period. In applying the provisions of this paragraph, a leave of absenceshall be considered a bona fide leave of absence only if there is a reasonable expectation that the Participant will returnto perform services for the Employer.(b)If a Participant provides services for an Employer as both an Employee and as an independent contractor or a memberof the Board, to the extent permitted by Treas. Reg. §1.409A-1(h)(5) the services provided by such Participant as anindependent contractor or member of the Board shall not be taken into account in determining whether the Participanthas experienced a Separation from Service as an Employee, and the services provided by such Participant as anEmployee shall not be taken into account in determining whether the Participant has experienced a Separation fromService as an independent contractor or member of the Board.1.39“Specified Employee” shall mean any Participant who is determined to be a “key employee” (as defined under Code section416(i) without regard to paragraph (5) thereof) for the applicable period, as determined annually by the Committee inaccordance with Treas. Reg. §1.409A-1(i). In determining whether a Participant is a Specified Employee, the followingprovisions shall apply:(a)The Committee’s identification of the individuals who fall within the definition of “key employee” under Code section416(i) (without regard to paragraph (5) thereof) shall be based upon the 12-month period ending on each December 31st(referred to below as the “identification date”). In applying the applicable provisions of Code section 416(i) to identifysuch individuals, “compensation” shall be determined in accordance with Treas. Reg. §1.415(c)-2(a) without regard to(i) any safe harbor provided in Treas. Reg. §1.415(c)-2(d), (ii) any of the special timing rules provided in Treas. Reg.§1.415(c)-2(e), and (iii) any of the special rules provided in Treas. Reg. §1.415(c)-2(g); and(b)Each Participant who is among the individuals identified as a “key employee” in accordance with part (a) of thisSection 1.39 shall be treated as a Specified Employee for purposes of this Plan if such Participant experiences aSeparation from Service during the 12-month period that begins on the April 1st following the applicable identificationdate.1.40“Successor Company” means the surviving company, the successor company or Parent Company, as applicable, inconnection with a Change in Control.1.41“Survivor Benefit” shall mean the benefit set forth in Article 8.1.42“Termination Benefit” shall mean the benefit set forth in Article 6.1.43“Trust” shall mean one or more trusts established by the Company in accordance with Article 15.1.44“Trustee” shall mean the duly appointed and acting trustee of the Trust, and any successor thereto.1.45“Unforeseeable Financial Emergency” shall mean a severe financial hardship of the Participant resulting from (a) an illnessor accident of the Participant, the Participant’s spouse, the Participant’s Beneficiary or the Participant’s dependent (as defined inCode section 152 without regard to paragraphs (b)(1), (b)(2) and (d)(1)(b) thereof), (b) a loss of the Participant’s property dueto casualty, or (c) such other similar extraordinary and unforeseeable circumstances arising as a result of events beyond thecontrol of the Participant, all as determined by the Committee based on the relevant facts and circumstances. The circumstancesthat will constitute an unforeseeable emergency will depend upon the facts of each case, but an Unforeseeable FinancialEmergency shall not be deemed to exist to the extent that such hardship is or may be relieved:(a)Through reimbursement or compensation by insurance or otherwise;(b)By liquidation of the Participant’s assets, to the extent the liquidation of such assets would not itself cause severefinancial hardship;(c)By cessation of deferrals under this Plan or elective contributions made by the Participant under any 401(k) plan orother deferred compensation plan maintained by an Employer;(d)Distributions or nontaxable loans from an Employer’s other plans or any other employer’s plans to the extent eligible;(e)Loans from commercial sources at reasonable commercial terms;(f)Bank or other savings accounts; or(g)Reasonable, periodic payment arrangements with a creditor.By way of example, the need to send a Participant’s child to college or the desire to purchase or improve a home is notconsidered an Unforeseeable Financial Emergency.1.46“Year of Service” shall mean each year of continuous employment by the Participant with an Employer. For purposes of thePlan, the employment relationship is treated as continuing intact while the Participant is on military leave, sick leave, or otherbona fide leave of absence if the period of such leave does not exceed six months, or if longer, so long as the Participant’s rightto reemployment is provided by either statute or contract.ARTICLE 2 Selection, Enrollment, and Eligibility 2.1Selection by Committee. Participation in the Plan shall be limited to a select group of management and highly compensatedEmployees of the Employer, as determined by the Committee, in its sole discretion. From that group, the Committee shallselect, in its sole discretion, Employees to participate in the Plan with respect to each Plan Year. The selection by theCommittee of an Employee to participate in the Plan with respect to one Plan Year does not guarantee participation withrespect to future Plan Years.2.2Enrollment Requirements. As a condition to participation, each selected Employee shall complete, execute and return tothe Committee an Election Form and a Beneficiary Designation Form, all by the deadline(s) established by the Committee inaccordance with the applicable provisions of the Plan. In addition, the Committee shall establish from time to time such otherenrollment requirements as it determines in its sole discretion are necessary.2.3Eligibility; Commencement of Participation. Provided an Employee selected to participate in the Plan has met all enrollmentrequirements set forth in this Plan and required by the Committee, including returning all required documents to the Committeewithin the specified time periods set forth in the Plan, that Employee shall commence participation in the Plan on the first day ofthe month following the month in which the Employee completes all enrollment requirements. If an Employee fails to meet allsuch requirements within the periods required, in accordance with the provisions of the Plan, that Employee shall not beeligible to participate in the Plan until the first day of the Plan Year following the delivery to and acceptance by the Committeeof the required documents.2.4Termination of Participation and/or Deferrals. If the Committee determines, in its sole discretion, that a Participant nolonger qualifies as a member of a select group of management or highly compensated employees, as membership in such groupis determined in accordance with ERISA Sections 201(2), 301(a)(3) and 401(a)(1), the Committee shall have the right, in itssole discretion, to (i) terminate any deferral election the Participant has made for the remainder of the Plan Year in which theParticipant's membership status changes, (ii) prevent the Participant from making future deferral elections and/or (iii) to theextent permitted under Code section 409A, immediately distribute the Participant's then vested Account Balance as aTermination Benefit, and terminate the Participant's participation in the Plan.ARTICLE 3 Deferral Commitments/Company Contribution Amounts/Vesting/Crediting/Taxes3.1Minimum Deferrals.(a)Annual Deferral Amount. For each Plan Year, a Participant may elect to defer, as his or her Annual DeferralAmount, Base Salary, Annual Bonus, Incentive Bonus in the following minimum amounts for each deferral elected:DeferralMinimum AmountBase Salary, AnnualBonus and/or IncentiveBonus$10,000 aggregateIf an election is made for less than the stated minimum amounts, or if no election is made, the amount deferred shall bezero.(b)Short Plan Year. Notwithstanding the foregoing, if a Participant first becomes a Participant after the first day of a PlanYear the minimum Annual Deferral Amount shall be an amount equal to the minimum set forth above, multiplied by afraction, the numerator of which is the number of complete months remaining in the Plan Year and the denominator ofwhich is 12.3.2Maximum Deferral.(a)Annual Deferral Amount. For each Plan Year, a Participant may elect to defer, as his or her Annual DeferralAmount, Base Salary, Annual Bonus, Incentive Bonus up to the following maximum percentages for each deferralelected:DeferralMaximum PercentageBase Salary90%Annual Bonus100%Incentive Bonus100%(b)Short Plan Year. Notwithstanding the foregoing, if a Participant first becomes a Participant after the first day of a PlanYear, then to the extent required by Section 3.3 and Code section 409A and related Treasury Regulations, themaximum amount of the Participant’s Annual Deferral Amount, Base Salary, Annual Bonus, and Incentive Bonus thatmay be deferred by the Participant for the Plan Year shall be determined by applying the percentages set forth inSection 3.2(a) to the portion of such compensation attributable to services performed after the date that the Participant’sdeferral election is made.3.3Election to Defer; Effect of Election Form.(a)First Plan Year. A selected Employee who first becomes eligible to participate in the Plan on or after the beginning ofa Plan Year, as determined in accordance with Treas. Reg. §1.409A-2(a)(7)(ii) and the “plan aggregation” rulesprovided in Treas. Reg. §1.409A-1(c)(2), may be permitted to make an election to defer the portion of Annual DeferralAmount, Base Salary, Annual Bonus, and Incentive Bonus attributable to services to be performed after such election,provided that the Participant submits an Election Form on or before the deadline established by the Committee, whichin no event shall be later than 30 days after the Participant first becomes eligible to participate in the Plan.Any deferral election made in accordance with this Section 3.3(a) shall become irrevocable no later than the 30th dayafter the date the selected Employee becomes eligible to participate in the Plan.(b)Subsequent Plan Years. For each succeeding Plan Year, the Participant’s prior election shall remain in effect unlessthe Participant makes a subsequent irrevocable deferral election for such succeeding Plan Year, by timely delivering anew Election Form to the Committee, in accordance with its rules and procedures, before the December 31 precedingthe Plan Year for which the election is made. If no such Election Form is timely delivered for a Plan Year, the AnnualDeferral Amount shall be the same amount as elected for the immediately prior Plan Year.3.4Withholding and Crediting of Annual Deferral Amounts. For each Plan Year, the Base Salary portion of the AnnualDeferral Amount shall be withheld from each regularly scheduled Base Salary payroll in equal amounts, as adjusted from timeto time for increases and decreases in Base Salary. The Annual Bonus and Incentive Bonus portion of the Annual DeferralAmount shall be withheld at the time the Annual Bonus or Incentive Bonus are or otherwise would be paid to the Participant,whether or not this occurs during the Plan Year itself. Annual Deferral Amounts shall be credited to a Participant’s DeferralAccount at the time such amounts would otherwise have been paid to the Participant.3.5Company Contribution Amount.(a)For each Plan Year, an Employer may be required to credit amounts to a Participant’s Company Contribution Accountin accordance with employment or other agreements entered into between the Participant and the Employer.Such amounts shall be credited on the date or dates prescribed by such agreements.(b)For each Plan Year, an Employer, in its sole discretion, may, but is not required to, credit any amount it desires to anyParticipant’s Company Contribution Account under this Plan, which amount shall be for that Participant theCompany Contribution Amount for that Plan Year. The amount so credited to a Participant may be smaller orlarger than the amount credited to any other Participant, and the amount credited to any Participant for a PlanYear may be zero, even though one or more other Participants receive a Company Contribution Amount for thatPlan Year; provided, however, the Employer shall determine the amount credited to each Participant in amanner that does not violate any applicable nondiscrimination law.(c)The Company Contribution Amount described in this Section 3.5, if any, shall be credited on a date or dates to bedetermined by the Committee, in its sole discretion.3.6Vesting.(a)A Participant shall at all times be 100% vested in his or her Deferral Account.(b)A Participant shall be vested in his or her Company Contribution Account after one Year of Service, provided that,with respect to any Company Contributions made, the Committee may, in its sole discretion, declare that a differentvesting schedule shall apply, which vesting schedule shall either solely apply to the Company Contributions made forsuch year, or to all future Company Contributions made thereafter, as determined by the Committee, in its solediscretion.(c)Notwithstanding anything to the contrary contained in this Section 3.6, upon a Change in Control or a Participant’sdeath while employed by an Employer, Retirement, or Disability, a Participant’s Company Contribution Account shallimmediately become 100% vested (if it is not already vested in accordance with the above vesting schedules).3.7Crediting/Debiting of Account Balances. In accordance with, and subject to, the rules and procedures that are establishedfrom time to time by the Committee, in its sole discretion, amounts shall be credited or debited to a Participant's AccountBalance in accordance with the following rules:(a)Measurement Funds. The Participant may elect one or more of the measurement funds selected by the Committee, inits sole discretion, which are based on certain mutual funds or such other financial measures as selected by theCommittee in its sole discretion (the “Measurement Funds”), for the purpose of crediting or debiting additionalamounts to his or her Account Balance. As necessary, the Committee may, in its sole discretion, discontinue, substituteor add a Measurement Fund. Each such action will take effect as of the first day of the first calendar quarter that beginsat least 30 days after the day on which the Committee gives Participants advance written notice of such change.(b)Election of Measurement Funds. A Participant, in connection with his or her initial deferral election in accordancewith Section 3.3(a) above, shall elect, on the Election Form, one or more Measurement Fund(s) (as described in Section3.7(a) above) to be used to determine the amounts to be credited or debited to his or her Account Balance. If aParticipant does not elect any of the Measurement Funds as described in the previous sentence, the Participant’sAccount Balance shall automatically be allocated into the lowest-risk Measurement Fund, as determined by theCommittee, in its sole discretion. The Participant may (but is not required to) elect, by submitting an Election Form tothe Committee that is accepted by the Committee, to add or delete one or more Measurement Fund(s) to be used todetermine the amounts to be credited or debited to his or her Account Balance, or to change the portion of his or herAccount Balance allocated to each previously or newly elected Measurement Fund. If an election is made inaccordance with the previous sentence, it shall apply as of the first business day deemed reasonably practicable by theCommittee, in its sole discretion, and shall continue thereafter for each subsequent day in which the Participantparticipates in the Plan, unless changed in accordance with the previous sentence. Notwithstanding the foregoing, allinvestments hereunder shall be considered assets of the Company, and the Participant shall remain subject to allapplicable provisions of the Plan, including, without limitation, Sections 15.4 and 16.2 below. Each Participant, as acondition to his or her participation in the Plan, agrees to indemnify and hold harmless the Committee, the Company,and each Employer, and their representatives, delegates and agents, from and against any investment losses or otherdamages of any kind relating to the deemed investment of the Participant’s Account Balance under the Plan. Noassurances are provided by any person or entity that any investment results of any Measurement Fund will be favorableand, as with most investments, there is a risk of loss.(c)Proportionate Allocation. In making any election described in Section 3.7(b) above, the Participant shall specify onthe Election Form, in increments of one percent (1%), the percentage of his or her Account Balance to be allocated to aMeasurement Fund (as if the Participant was making an investment in that Measurement Fund with that portion of hisor her Account Balance).(d)Crediting or Debiting Method. The performance of each Measurement Fund (either positive or negative) will bedetermined by the Committee, in its sole discretion on a daily basis based on the manner in which such Participant’sAccount Balance has been hypothetically allocated among the Measurement Funds by the Participant.(e)No Actual Investment. Notwithstanding any other provision of this Plan that may be interpreted to the contrary, theMeasurement Funds are to be used for measurement purposes only, and a Participant's election of any suchMeasurement Fund, the allocation of his or her Account Balance thereto, the calculation of additional amounts and thecrediting or debiting of such amounts to a Participant's Account Balance shall not be considered or construed in anymanner as an actual investment of his or her Account Balance in any such Measurement Fund. In the event that theCompany or the Trustee, in its own discretion, decides to invest funds in any or all of the investments on which theMeasurement Funds are based, no Participant shall have any rights in or to such investments themselves. Withoutlimiting the foregoing, a Participant's Account Balance shall at all times be a bookkeeping entry only and shall notrepresent any investment made on his or her behalf by the Company or the Trust; the Participant shall at all timesremain an unsecured creditor of the Company.3.8FICA and Other Taxes.(a)Annual Deferral Amounts. For each Plan Year in which an Annual Deferral Amount is being withheld from aParticipant, the Participant’s Employer(s) shall withhold from that portion of the Participant’s Base Salary, AnnualBonus and/or Incentive Bonus that is not being deferred, in a manner determined by the Employer(s), the Participant’sshare of FICA and other employment taxes on such Annual Deferral Amount. If necessary, the Committee may reducethe Annual Deferral Amount in order to comply with this Section 3.8.(b)Company Contribution Account. When a Participant becomes vested in a portion of his or her CompanyContribution Account, the Participant’s Employer(s) shall withhold from that portion of the Participant’s Base Salary,Annual Bonus and/or Incentive Bonus that is not deferred, in a manner determined by the Employer(s), the Participant’sshare of FICA and other employment taxes on such Company Contribution Amount. If necessary, the Committee mayreduce the vested portion of the Participant’s Company Contribution Account in order to comply with this Section 3.8.(c)Distributions. The Participant’s Employer(s), or the Trustee, shall withhold from any payments made to a Participantunder this Plan all federal, state and local income, employment and other taxes required to be withheld by theEmployer(s), or the Trustee, in connection with such payments, in amounts and in a manner to be determined in the solediscretion of the Employer(s) and the Trustee.ARTICLE 4 In-Service Scheduled Distribution; Unforeseeable Financial Emergencies; Withdrawal Election4.1In-Service Scheduled Distribution. In connection with each election to defer an Annual Deferral Amount, a Participant mayirrevocably elect to receive an In-Service Scheduled Distribution from the Plan with respect to all or a portion of (i) the AnnualDeferral Amount and (ii) the Company Contribution Amount. The In-Service Scheduled Distribution shall be a lump sumpayment in an amount that is equal to the portion of the Annual Deferral Amount and the vested portion of the CompanyContribution Amount that the Participant elected to have distributed as an In-Service Scheduled Distribution, plus amountscredited or debited in the manner provided in Section 3.7 above to that amount, calculated as of the close of business on oraround the Benefit Distribution Date designated by the Participant in accordance with this Section 4.1 (a “ScheduledDistribution”). The Benefit Distribution Date for an amount subject to an In-Service Scheduled Distribution election shall bethe first day of any Plan Year designated by the Participant, which may be no sooner than 3 Plan Years after the end of thePlan Year in which the Annual Deferral Amount is actually deferred or the vested portion of the Company ContributionAmount is actually contributed. The Participant may elect different Benefit Distribution Dates for amounts deferred withrespect to different Plan Years. Subject to the other terms and conditions of this Plan, each In-Service Scheduled Distributionelected shall be paid out during a 60-day period commencing immediately after the Benefit Distribution Date. By way ofexample, if an In-Service Scheduled Distribution is elected for Annual Deferral Amounts that are deferred in the Plan Yearcommencing January 1, 2019, the earliest Benefit Distribution Date that may be designated by a Participant would beJanuary 1, 2023, and the In-Service Scheduled Distribution would be paid out during the 60-day period commencingimmediately after such Benefit Distribution Date.4.2Other Benefits Take Precedence Over In-Service Scheduled Distributions. Should an event occur prior to any BenefitDistribution Date designated for a Scheduled Distribution that triggers a benefit under Articles 5, 6, 7, or 8, any AnnualDeferral Amount and/or Company Contribution Amount, plus amounts credited or debited thereon, that are subject to an In-Service Scheduled Distribution election under Section 4.1 above shall not be paid in accordance with Section 4.1 above, butshall be paid in accordance with the other applicable Article.4.3Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies.(a)If the Participant experiences an Unforeseeable Financial Emergency prior to the occurrence of a distribution eventunder Articles 5, 6, 7, or 8, the Participant may petition the Committee to suspend deferrals of Base Salary, AnnualBonus, and Incentive Bonus required to be made by such Participant, to the extent deemed necessary by the Committeeto satisfy the Unforeseeable Financial Emergency. If suspension of deferrals is not sufficient to satisfy the Participant’sUnforeseeable Financial Emergency, the Participant may further petition the Committee to receive a partial or fullpayout from the Plan. The Participant shall only receive a payout from the Plan to the extent such payout is deemednecessary by the Committee to satisfy the Participant’s Unforeseeable Financial Emergency.(b)The payout shall not exceed the lesser of (i) the Participant's vested Account Balance, calculated as of the close ofbusiness on or around the Benefit Distribution Date for such payout, as determined by the Committee in accordancewith the provisions set forth below, or (ii) the amount reasonably needed to satisfy the Unforeseeable FinancialEmergency, plus amounts necessary to pay Federal, state, or local income taxes or penalties reasonably anticipated as aresult of the distribution.(c)If the Committee, in its sole discretion, approves a Participant’s petition for suspension, the Participant’s deferrals underthis Plan shall be suspended as of the date of such approval. If the Committee, in its sole discretion, approves aParticipant’s petition for suspension and payout, the Participant’s deferrals under this Plan shall be suspended as of thedate of such approval and the Participant’s Benefit Distribution Date for such payout shall be the date on which suchCommittee approval occurs, and such payout shall be distributed to the Participant in a lump sum no later than 60 daysafter such Benefit Distribution Date.ARTICLE 5 Retirement Benefit5.1Retirement Benefit. A Participant who experiences a Separation from Service that qualifies as a Retirement shall receive, as aRetirement Benefit, his or her vested Account Balance in either a lump sum or annual installment payments, as elected by theParticipant in accordance with Section 5.2. A Participant’s Retirement Benefit shall be calculated as of the close of business onor around the applicable Benefit Distribution Date for such benefit. The Benefit Distribution Date shall be (i) the first day afterthe end of the six-month period immediately following the date on which the Participant Retires, if the Participant is a SpecifiedEmployee, and (ii) for all other Participants, the date on which the Participant Retires; provided, however, if a Participantchanges the form of distribution for the Retirement Benefit in accordance with Section 5.2(b), the Benefit Distribution Date forthe Retirement Benefit shall be determined in accordance with Section 5.2(b).5.2Payment of Retirement Benefit.(a)A Participant, in connection with his or her commencement of participation in the Plan, shall elect on an Election Formto receive the Retirement Benefit upon Retirement in a lump sum or pursuant to an Annual Installment Method of up to15 years. If a Participant does not make any election with respect to the payment of the Retirement Benefit uponRetirement, then such benefit shall be payable in a lump sum.(b)A Participant may change the form of payment for the Retirement Benefit upon Retirement by submitting an ElectionForm to the Committee in accordance with the following criteria:(i)The election shall not take effect until at least 12 months after the date on which the election is made;(ii)The new Benefit Distribution Date for the Participant’s Retirement Benefit upon Retirement shall be 5 yearsafter the Benefit Distribution Date that would otherwise have been applicable to such benefit; and(iii)The election must be made at least 12 months prior to the Benefit Distribution Date that would otherwise havebeen applicable to the Participant’s Retirement Benefit upon Retirement.For purposes of applying the provisions of this Section 5.2(b), a Participant’s election to change the form of paymentfor the Retirement Benefit upon Retirement shall not be considered to be made until the date on which the electionbecomes irrevocable. Such an election shall become irrevocable no later than the date that is 12 months prior to theBenefit Distribution Date that would otherwise have been applicable to the Participant’s Retirement Benefit uponRetirement. Subject to the requirements of this Section 5.2(b), the Election Form most recently accepted by theCommittee that has become effective shall govern the form of payout of the Participant’s Retirement Benefit.(c)The lump sum payment shall be made, or installment payments shall commence, no later than 60 days after theParticipant’s Benefit Distribution Date. Remaining installments, if any, shall be paid no later than 60 days after eachanniversary of the Participant’s Benefit Distribution Date.(d)Notwithstanding anything to the contrary contained herein, the Company may distribute a Participant’s AccountBalance if, at any time after such Participant’s Separation from Service, the Account Balance does not exceed the limitin Code section 402(g)(1)(B) and such distribution would result in the termination of the Participant’s entire interest inthe Plan as provided under Code section 409A.ARTICLE 6 Termination Benefit 6.1Termination Benefit. A Participant who experiences a Separation from Service that does not qualify as a Retirement shallreceive a Termination Benefit, which shall be equal to the Participant's vested Account Balance, calculated as of the close ofbusiness on or around the Benefit Distribution Date for such benefit. The Benefit Distribution Date shall be (i) the first day afterthe end of the six-month period immediately following the date on which the Participant experiences a Separation from Service,if the Participant is a Specified Employee, and (ii) for all other Participants, the date on which the Participant experiences aSeparation from Service.6.2Payment of Termination Benefit. The Termination Benefit shall be paid to the Participant in a lump sum payment no laterthan 60 days after the Participant’s Benefit Distribution Date.ARTICLE 7 Disability Waiver and Benefit 7.1Disability Benefit. A Participant who experiences a Disability, shall receive, as a Disability Benefit his or her vested AccountBalance, calculated as of the close of business on or around the Benefit Distribution Date for such benefit. The BenefitDistribution Date shall be the date that the Committee determines that such Participant is Disabled within the meaning ofSection 1.19; provided, however, if the Participant experienced a Separation from Service prior to the date he or she wasDisabled, then the Benefit Distribution Date shall be determined in accordance with Section 5.1 or 6.1 above, as applicable(and the Participant shall receive a Retirement Benefit or Termination Benefit, as applicable, and not a Disability Benefit). AParticipant, in connection with his or her commencement of participation in the Plan, shall elect on an Election Form to receivethe Disability Benefit in a lump sum or pursuant to an Annual Installment Method of up to 15 years. If a Participant does notmake any election with respect to the payment of the Disability Benefit, then such benefit shall be payable in a lump sum. Thelump sum payment shall be made, or installment payments shall commence, no later than 60 days after the DisabledParticipant’s Benefit Distribution Date, and any remaining installments, if any, shall be paid no later than 60 days after eachanniversary of the Disabled Participant’s Benefit Distribution Date.7.2Deferral Following Disability. If a Participant returns to employment with an Employer after a Disability ceases, theParticipant may elect to defer an Annual Deferral Amount for the Plan Year following his or her return to employment orservice and for every Plan Year thereafter while a Participant in the Plan; provided such deferral elections are otherwiseallowed and an Election Form is delivered to and accepted by the Committee for each such election in accordance withSection 3.3(b) above.ARTICLE 8 Survivor Benefit 8.1Survivor Benefit. In the event of a Participant’s death prior to the complete distribution of his or her vested Account Balance,the Participant's Beneficiary(ies) shall receive a Survivor Benefit which will be equal to the Participant's unpaid vested AccountBalance, calculated as of the close of business on or around the Benefit Distribution Date for such benefit. The BenefitDistribution Date shall be the date on which the Committee is provided with proof that is satisfactory to the Committee of theParticipant’s death.8.2Payment of Survivor Benefit. The Survivor Benefit shall be paid to the Participant’s Beneficiary(ies) in a lump sum paymentno later than 60 days after the Participant’s Benefit Distribution Date.ARTICLE 9 Beneficiary Designation 9.1Beneficiary. Each Participant shall have the right, at any time, to designate his or her Beneficiary(ies) (both primary as well ascontingent) to receive any benefits payable under the Plan to a beneficiary upon the death of a Participant. The Beneficiarydesignated under this Plan may be the same as or different from the Beneficiary designation under any other plan of anEmployer in which the Participant participates.9.2Beneficiary Designation; Change; Spousal Consent. A Participant shall designate his or her Beneficiary by completing andsigning the Beneficiary Designation Form, and returning it to the Committee or its designated agent. A Participant shall havethe right to change a Beneficiary by completing, signing and otherwise complying with the terms of the BeneficiaryDesignation Form and the Committee's rules and procedures, as in effect from time to time. If the Participant names someoneother than his or her spouse as a Beneficiary, spousal consent in writing to the designation of a different Beneficiary is requiredto be provided in a form designated by the Committee, executed by such Participant's spouse and returned to the Committee. ABeneficiary designation that has received spousal consent cannot be changed without spousal consent. Upon the acceptance bythe Committee of a new Beneficiary Designation Form, all Beneficiary designations previously filed shall be canceled. TheCommittee shall be entitled to rely on the last Beneficiary Designation Form filed by the Participant and accepted by theCommittee prior to his or her death.9.3Acknowledgment. No designation or change in designation of a Beneficiary shall be effective until received andacknowledged in writing by the Committee or its designated agent.9.4No Beneficiary Designation. If a Participant fails to designate a Beneficiary as provided in Sections 9.1, 9.2 and 9.3 above or,if all designated Beneficiaries predecease the Participant or die prior to complete distribution of the Participant's benefits, thenthe Participant's designated Beneficiary shall be deemed to be his or her surviving spouse. If the Participant has no survivingspouse, the benefits remaining under the Plan to be paid to a Beneficiary shall be payable to the executor or personalrepresentative of the Participant's estate.9.5Doubt as to Beneficiary. If the Committee has any doubt as to the proper Beneficiary to receive payments pursuant to thisPlan, the Committee shall have the right, exercisable in its discretion, to either (i) cause the Participant's Employer to withholdsuch payments until this matter is resolved to the Committee's satisfaction or (ii) direct that the amount be paid into any court ofcompetent jurisdiction in an interpleader action, and such payment shall be a full and complete discharge of any liability orobligation under the Plan or Trust Agreement to the full extent of such payment.9.6Discharge of Obligations. The payment of benefits under the Plan to a Beneficiary shall fully and completely discharge allEmployers and the Committee from all further obligations under this Plan with respect to the Participant.ARTICLE 10 Leave of Absence 10.1Paid Leave of Absence. If a Participant is authorized by the Participant's Employer to take a paid leave of absence from theemployment of the Employer and such leave of absence does not constitute a Separation from Service, (i) the Participant shallcontinue to be considered eligible for the benefits provided in Articles 4, 5, 6, 7 or 8 in accordance with the provisions of thoseArticles, and (ii) the Annual Deferral Amount shall continue to be withheld during such paid leave of absence in accordancewith Section 3.3 above.10.2Unpaid Leave of Absence. If a Participant is authorized by the Participant's Employer to take an unpaid leave of absence fromthe employment of the Employer for any reason and such leave of absence does not constitute a Separation from Service, suchParticipant shall continue to be eligible for the benefits provided in Articles 4, 5, 6, 7 or 8 in accordance with the provisions ofthose Articles. However, the Participant shall be excused from fulfilling his or her Annual Deferral Amount commitment thatwould otherwise have been withheld during the remainder of the Plan Year in which the unpaid leave of absence is taken.During the unpaid leave of absence, the Participant shall not be allowed to make any new or additional deferral elections.However, if the Participant returns to employment, the Participant may elect to defer an Annual Deferral Amount for the PlanYear following his or her return to employment and for every Plan Year thereafter while a Participant in the Plan; providedsuch deferral elections are otherwise allowed and an Election Form is delivered to and accepted by the Committee for eachsuch election in accordance with Section 3.3 above.ARTICLE 11 Termination, Amendment or Modification11.1Termination. Although the Company anticipates that it will continue the Plan for an indefinite period of time, there is noguarantee that the Company will continue the Plan or will not terminate the Plan at any time in the future or that any Employerwill continue to participate in the Plan or will not terminate its participation in the Plan at any time in the future. Accordingly,the Company reserves the right to discontinue its sponsorship of the Plan and each Employer reserves the right to withdraw itsparticipation in the Plan and both the Company and each Employer reserves the right to terminate the Plan at any time withrespect to any or all of its participating Employees, by action of its Board. However, after the Plan termination the AccountBalances of such Participants shall continue to be credited with Annual Deferral Amounts attributable to a deferral election thatwas in effect prior to the Plan termination to the extent deemed necessary to comply with Code section 409A and relatedTreasury Regulations, and additional amounts shall continue to credited or debited to such Participants’ Account Balancespursuant to Section 3.7. The Measurement Funds available to Participants following the termination of the Plan shall becomparable in number and type to those Measurement Funds available to Participants in the Plan Year preceding the Plan Yearin which the Plan termination is effective. In addition, following a Plan termination, Participant Account Balances shall remainin the Plan and shall not be distributed until such amounts become eligible for distribution in accordance with the otherapplicable provisions of the Plan. Notwithstanding the preceding sentence, to the extent permitted by Treas. Reg. §1.409A-3(j)(4)(ix), the Employer may provide that upon termination of the Plan, all Account Balances of the Participants shall bedistributed, subject to and in accordance with any rules established by such Employer deemed necessary to comply with theapplicable requirements and limitations of Treas. Reg. §1.409A-3(j)(4)(ix).11.2Amendment. The Company may, at any time, amend or modify the Plan in whole or in part by the action of its Board;provided, however, that: (i) no amendment or modification shall be effective to decrease or restrict the value of a Participant'svested Account Balance in existence at the time the amendment or modification is made, and (ii) no amendment or modificationof this Section 11.2 or Section 12.3 below shall be effective. Notwithstanding the foregoing provisions of this Section 11.2, bywritten instrument, the Plan may be amended by the Company at any time prior to a Change in Control if required to ensurethat the Plan is characterized as a “top-hat plan” of deferred compensation maintained for a select group of management orhighly compensated employees as described under ERISA Sections 201(2), 301(a)(3), and 401(a)(1), or to conform the Plan tothe provisions and requirements of any applicable law (including ERISA and the Code). No such amendment described in theimmediately preceding sentence shall be considered prejudicial to any interest of a Participant or a Beneficiary hereunder.11.3Effect of Payment. The full payment of the Participant’s vested Account Balance under Articles 4, 5, 6, or 7 of the Plan shallcompletely discharge all obligations to a Participant and his or her designated Beneficiaries under this Plan shall terminate.ARTICLE 12 Administration 12.1Committee Duties. Except as otherwise provided in this Article 12, this Plan shall be administered by a Committee, whichshall consist of the Board of the Company, or such committee as the Board of the Company shall appoint. The Board of theCompany may remove or replace any member of a committee appointed by the Board of the Company at any time in its solediscretion. Members of the Committee may be Participants under this Plan. Any individual serving on the Committee who is aParticipant shall abstain from any discussion and vote, and shall not otherwise act on any matter relating directly to himself orherself. When making a determination or calculation, the Committee shall be entitled to rely on information furnished by aParticipant or the Company. The members of the Committee shall not receive any special compensation for serving in theircapacities as members of the Committee, but shall be reimbursed by the Company for any reasonable expenses incurred inconnection therewith. No bond or other security need be required of the Committee or any member thereof.12.2Administration of the Plan. The Committee shall operate, administer, interpret, construe, and construct the Plan, includingwithout limitation, the sole discretion and authority to (i) make, amend, interpret and enforce all appropriate rules andregulations for the administration of this Plan and (ii) decide or resolve any and all questions as may arise in connection withthe Plan, including correcting any defect, supplying any omission, or reconciling any inconsistency. The Committee shall haveall powers necessary or appropriate to implement and administer the terms and provisions of the Plan, including the power tomake findings of fact.12.3Administration Upon Change In Control. For purposes of this Plan, the Committee shall be the “Administrator” at all timesprior to the occurrence of a Change in Control Within 120 days following a Change in Control, an independent third party“Administrator” may be selected by the individual who, immediately prior to the Change in Control, was the Company’s ChiefExecutive Officer, Chief Financial Officer, Chief Legal Officer or, if not so identified, the Company’s highest ranking officer(the “Ex-Officer”), and approved by the Trustee. The Committee, as constituted prior to the Change in Control, shall continueto be the Administrator until the earlier of (i) the date on which such independent third party is selected and approved, or (ii) theexpiration of the one hundred and twenty (120) day period following the Change in Control. If an independent third party isnot selected within 120 days of such Change in Control, the Committee, as described in Section 12.1 above, shall be theAdministrator. The Administrator shall have the discretionary power to determine all questions arising in connection with theadministration of the Plan and the interpretation of the Plan and Trust including, but not limited to benefit entitlementdeterminations; provided, however, upon and after the occurrence of a Change in Control, the Administrator shall have nopower to direct the investment of Plan or Trust assets or select any investment manager or custodial firm for the Plan or Trust.Upon and after the occurrence of a Change in Control, the Company must: (1) pay all reasonable administrative expenses andfees of the Administrator; (2) indemnify the Administrator against any costs, expenses and liabilities including, withoutlimitation, attorney’s fees and expenses arising in connection with the performance of the Administrator hereunder, except withrespect to matters resulting from the gross negligence or willful misconduct of the Administrator or its employees or agents; and(3) supply full and timely information to the Administrator on all matters relating to the Plan, the Trust, the Participants andtheir Beneficiaries, the Account Balances of the Participants, the date and circumstances of the Disability, death or Separationfrom Service of the Participants, and such other pertinent information as the Administrator may reasonably require. Upon andafter a Change in Control, the Administrator may be terminated (and a replacement appointed) by the Trustee only with theapproval of the Ex-Officer. Upon and after a Change in Control, the Administrator may not be terminated by the Company.12.4Agents. In the administration of this Plan, the Committee may, from time to time, employ agents and delegate to them suchadministrative duties as it sees fit (including acting through a duly appointed representative).12.5Binding Effect of Decisions. The determination of the Committee as to the proper interpretation, construction, or application ofany term or provision in the Plan and the rules and regulations promulgated hereunder shall be final, binding, and conclusivewith respect to all interested parties.12.6Indemnity of Committee. To the full extent permitted by applicable law, the Company and each Employer shall individuallyand collectively indemnify and hold harmless each past, present, and future member of the Committee, any Employee to whomthe duties of the Committee may be delegated, and the Administrator against any and all claims, losses, damages, judgments,settlements, costs, expenses or liabilities (and all actions in respect thereof and any legal or other costs and expenses in givingtestimony or furnishing documents in response to a subpoena or otherwise) arising from any action or failure to act with respectto this Plan, except in the case of gross negligence or willful misconduct by the Committee, any of its members, any suchEmployee or the Administrator, including the cost of investigating, preparing, or defending any pending, threatened oranticipated possible action, claim, suit or other proceeding, whether or not in connection with litigation in which theCommittee, such Employee, or the Administrator is a party. The foregoing right of indemnification shall inure to the benefit ofthe successors and assigns, and the heirs, executors, administrators and personal representatives of the Committee, any suchEmployee, and the Administrator, and shall be in addition to all other rights to which the Committee, any such Employee, andthe Administrator may be entitled as a matter of law, contract, or otherwise. The amount of indemnification during a calendaryear shall not affect the fees and expenses eligible for reimbursement in any other calendar year. Indemnification shall be madeon or before the last day of the calendar year following the calendar year in which the amounts or liabilities subject to suchindemnification were incurred.12.7Employer Information. To enable the Committee and/or Administrator to perform its functions, the Company and eachEmployer shall supply full and timely information to the Committee and/or Administrator, as the case may be, on all mattersrelating to the compensation of its Participants, the date and circumstances of the Disability, death or Separation from Service ofits Participants, and such other pertinent information as the Committee or Administrator may reasonably require.12.8Reliance Upon Information. No member of the Committee shall be liable for any decision, action, omission, or mistake injudgment in connection with the administration of the Plan, provided that he acted in good faith. Without limiting the generalityof the foregoing sentence, any decision or action taken by the Committee in reasonable reliance upon information supplied to itby the Board, the Company, any Employer, legal counsel, or the Company’s independent accountants shall be deemed to havebeen taken in good faith. The Committee may from time to time consult with counsel who may be counsel to any Employer orother counsel, with respect to its obligations or duties hereunder, or with respect to any action, proceeding or question of law,and shall not be held liable with respect to any action taken or omitted, in good faith, pursuant to the advice of such counsel.ARTICLE 13 Other Benefits and Agreements13.1Coordination with Other Benefits. The benefits provided for a Participant and Participant's Beneficiary under the Plan are inaddition to any other benefits available to such Participant under any other plan or program for employees of the Participant'sEmployer. The Plan shall supplement and shall not supersede, modify or amend any other such plan or program except as mayotherwise be expressly provided.ARTICLE 14 Claims Procedures 14.1Presentation of Claim. Any Participant or Beneficiary of a deceased Participant (such Participant or Beneficiary beingreferred to below as a “Claimant”) may deliver to the Committee a written claim for a determination with respect to the amountsdistributable to such Claimant from the Plan. If such a claim relates to the contents of a notice received by the Claimant, theclaim must be made within 60 days after such notice was received by the Claimant. All other claims must be made within180 days of the date on which the event that caused the claim to arise occurred. The claim must state with particularity thedetermination desired by the Claimant.14.2Notification of Decision. The Committee shall consider a Claimant's claim within a reasonable time, but no later than 90 daysafter receiving the claim. If the Committee determines that special circumstances require an extension of time for processing theclaim, written notice of the extension shall be furnished to the Claimant prior to the termination of the initial 90-day period. Inno event shall such extension exceed a period of 90 days from the end of the initial period. The extension notice shall indicatethe special circumstances requiring an extension of time and the date by which the Committee expects to render the benefitdetermination. The Committee shall notify the Claimant in writing:(a)that the Claimant's requested determination has been made, and that the claim has been allowed in full; or(b)that the Committee has reached a conclusion contrary, in whole or in part, to the Claimant's requested determination,and such notice must set forth in a manner calculated to be understood by the Claimant:(i)the specific reason(s) for the denial of the claim, or any part of it;(ii)specific reference(s) to pertinent provisions of the Plan upon which such denial was based;(iii)a description of any additional material or information necessary for the Claimant to perfect the claim, and anexplanation of why such material or information is necessary;(iv)an explanation of the claim review procedure set forth in Section 14.3 below; and(v)a statement of the Claimant’s right to bring a civil action under ERISA Section 502(a) following an adversebenefit determination on review.14.3Review of a Denied Claim. On or before 60 days after receiving a notice from the Committee that a claim has been denied, inwhole or in part, a Claimant (or the Claimant's duly authorized representative), if he or she disagrees with the claim denial, mustfile with the Committee a written request for a review of the denial of the claim. The Claimant (or the Claimant's dulyauthorized representative):(a)may, upon request and free of charge, have reasonable access to, and copies of, all documents, records and otherinformation relevant to the claim for benefits;(b)may submit written comments or other documents; and/or(c)may request a hearing, which the Committee, in its sole discretion, may grant.14.4Decision on Review. The Committee shall render its decision on review promptly, and no later than 60 days after theCommittee receives the Claimant’s written request for a review of the denial of the claim. If the Committee determines thatspecial circumstances require an extension of time for processing the claim, written notice of the extension shall be furnished tothe Claimant prior to the termination of the initial 60-day period. In no event shall such extension exceed a period of 60 daysfrom the end of the initial period. The extension notice shall indicate the special circumstances requiring an extension of timeand the date by which the Committee expects to render the benefit determination. In rendering its decision, the Committee shalltake into account all comments, documents, records and other information submitted by the Claimant relating to the claim,without regard to whether such information was submitted or considered in the initial benefit determination. The decision mustbe written in a manner calculated to be understood by the Claimant, and it must contain:(a)specific reasons for the decision;(b)specific reference(s) to the pertinent Plan provisions upon which the decision was based;(c)a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to and copies of,all documents, records and other information relevant (as defined in applicable ERISA regulations) to the Claimant’sclaim for benefits; and(d)a statement of the Claimant’s right to bring a civil action under ERISA Section 502(a).14.5Legal Action. A Claimant's compliance with the foregoing provisions of this Article 14 is a mandatory prerequisite to aClaimant's right to commence any legal action with respect to any claim for benefits under this Plan.ARTICLE 15 Trust 15.1Establishment of the Trust. In order to provide assets from which to fulfill the obligations of the Participants and theirbeneficiaries under the Plan, the Company intends, pursuant to formal action by the Committee, to establish a trust by a trustagreement with a third party, the Trustee, to which each Employer may, in its discretion, contribute cash or other property,including securities issued by the Company, to provide for the benefit payments under the Plan; provided, however, in theevent of a Change in Control the Company must contribute sufficient assets to any such Trust equal to the aggregate value ofall Account Balances determined as of the date of the Change in Control.15.2Interrelationship of the Plan and the Trust. The provisions of the Plan shall govern the rights of a Participant to receivedistributions pursuant to the Plan. The provisions of the Trust shall govern the rights of the Employers, Participants and thecreditors of the Employers to the assets transferred to the Trust. Each Employer shall at all times remain liable to carry out itsobligations under the Plan.15.3Distributions From the Trust. Each Employer's obligations under the Plan may be satisfied with Trust assets distributedpursuant to the terms of the Trust, and any such distribution shall reduce the Employer's obligations under this Plan.15.4Participants’ Rights under the Trust. The assets of the Trust shall be held for the benefit of the Participants in accordancewith the terms of the Plan and Trust Agreement. All the assets of the Trust shall remain subject to the claims of the generalunsecured creditors of each Employer, and the rights of the Participants to the assets of the Trust shall be limited as provided inthe Plan and Trust Agreement in the event that an Employer becomes Insolvent.ARTICLE 16 Miscellaneous 16.1Status of Plan. The Plan is intended to be a plan that is not qualified within the meaning of Code section 401(a) and that “isunfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group ofmanagement or highly compensated employees” within the meaning of ERISA Sections 201(2), 301(a)(3) and 401(a)(1), andas such it is intended that the Plan be exempt from the participation, vesting, funding, and fiduciary responsibility requirementsof Title I of ERISA. This Plan is also intended to qualify for simplified reporting under U.S. Department of Labor RegulationSection 2530.104-23, which provides for an alternative method of compliance for plans described in such regulation. The Planshall be administered and interpreted (a) to the extent possible in a manner consistent with the intent described in the precedingsentence, and (b) in accordance with Code section 409A the Final Regulations thereunder and other related Treasury guidance.16.2Limitation of Rights. Nothing in this Plan shall be construed to:(a)Give any individual who is employed by an Employer or any entity under common ownership or control with anEmployer any right to be a Participant unless and until such person is designated pursuant to Section 2.1 above;(b)Give a Participant any rights, other than as an unsecured general creditor of each Employer with respect to any amountcredited to his or her Account, until such amount is actually distributed to him or her;(c)Limit in any way the right of an Employer to terminate a Participant’s employment;(d)Give a Participant or any other person any interest in any fund, reserve or any specific asset of the Employer or anyentity under common ownership or control with an Employer; or(e)Create a fiduciary relationship between the Participant and any Employer.16.3Nonalienation of Benefits. No right or benefit under this Plan shall be subject to anticipation, alienation, attachment,garnishment, sale, transfer, assignment (either at law or in equity), levy, execution, pledge, encumbrance, charge, or any otherlegal or equitable process, and any attempt to do so will be void and without effect. No right or benefit hereunder shall in anymanner be liable for or subject to any debts, contracts, liabilities, engagements, or torts of the Participant or Beneficiary entitledto such benefits. The withholding of taxes from benefit payments hereunder; the recovery under the Plan of overpayments ofbenefits previously made to a Participant; the transfer of benefit rights from the Plan to another plan; or the direct deposit ofbenefit payments to an account in a banking institution (if not actually part of an arrangement constituting an assignment oralienation), shall not be construed as an assignment or alienation for purposes of the immediately preceding paragraph. The firstsentence of this Section 16.3 shall not preclude (a) the Participant from designating a Beneficiary to receive any benefit payablehereunder upon his or her death, or (b) the executors, administrators, or other legal representatives of the Participant or his orher estate from assigning any rights hereunder to the person or persons entitled thereto. In the event that any Participant’s orBeneficiary’s benefits hereunder are garnished or attached by order of any court, the Company or the Trustee may bring anaction or a declaratory judgment in a court of competent jurisdiction to determine the proper recipient of the benefits to be paidunder the Plan. During the pendency of such action, any benefits that become payable shall be held as credits to theParticipant’s Account or, if the Company prefers, paid into the court as they become payable, to be distributed by the court tothe recipient as the court deems proper at the close of such action.16.4Unsecured General Creditor. Participants and their Beneficiaries, heirs, successors and assigns shall have no legal orequitable rights, interests or claims in any property or assets of an Employer. For purposes of the payment of benefits under thisPlan, any and all of an Employer's assets shall be, and remain, the general, unpledged unrestricted assets of the Employer. AnEmployer's obligation under the Plan shall be merely that of an unfunded and unsecured promise to pay money in the future.16.5Waiver. No term or condition of this Plan shall be deemed to have been waived, nor shall there be an estoppel against theenforcement of any provision of this Plan, except by written instrument of the party charged with such waiver or estoppel. Nosuch written waiver shall be deemed a continuing waiver unless specifically stated therein, and each such waiver shall operateonly as to the specific term or condition waived and shall not constitute a waiver of such term or condition for the future or as toany act other than that specifically waived. Any waiver by any party hereto of a breach of any provision of the Plan by anyother party shall not operate or be construed as a waiver by such party of any subsequent breach thereof.16.6Employer's Liability. An Employer's liability for the payment of benefits shall be defined only by the Plan, as entered intobetween the Employer and a Participant. An Employer shall have no obligation to a Participant under the Plan except asexpressly provided in the Plan.16.7Nonassignability. Neither a Participant nor any other person shall have any right to commute, sell, assign, transfer, pledge,anticipate, mortgage or otherwise encumber, transfer, hypothecate, alienate or convey in advance of actual receipt, the amounts,if any, payable hereunder, or any part thereof, which are, and all rights to which are expressly declared to be, unassignable andnon-transferable. No part of the amounts payable shall, prior to actual payment, be subject to seizure, attachment, garnishmentor sequestration for the payment of any debts, judgments, alimony or separate maintenance owed by a Participant or any otherperson, be transferable by operation of law in the event of a Participant's or any other person's bankruptcy or insolvency or betransferable to a spouse as a result of a property settlement or otherwise.16.8Not a Contract of Employment. The terms and conditions of this Plan shall not be deemed to constitute a contract ofemployment between any Employer and the Participant. Such employment is hereby acknowledged to be an “at will”employment relationship that can be terminated at any time for any reason, or no reason, with or without cause, and with orwithout notice, unless expressly provided in a written employment agreement. Nothing in this Plan shall be deemed to give aParticipant the right to be retained in the service of any Employer, or to interfere with the right of any Employer to discipline ordischarge the Participant at any time.16.9Furnishing Information. A Participant or his or her Beneficiary will cooperate with the Committee by furnishing any and allinformation requested by the Committee and take such other actions as may be requested in order to facilitate the administrationof the Plan and the payments of benefits hereunder, including but not limited to taking such physical examinations as theCommittee may deem necessary.16.10Terms. Whenever any words are used herein in the masculine, they shall be construed as though they were in the feminine inall cases where they would so apply; and whenever any words are used herein in the singular or in the plural, they shall beconstrued as though they were used in the plural or the singular, as the case may be, in all cases where they would so apply.16.11Captions. Headings and paragraphs of this Plan are for convenience only and shall not control or affect the meaning orconstruction of any of its provisions.16.12Governing Law. Subject to ERISA, the provisions of this Plan shall be governed by, construed, and enforced in accordancewith the laws of the State of Texas (excluding any conflict of laws, rule or principle of Texas law that might refer thegovernance, construction, or interpretation of this Plan to the laws of another state). A Participant’s sole remedy for any Claimshall be against the Company, and no Participant shall have any claim or right of any nature against any Related Company ofthe Company or any stockholder or existing or former director, officer or Employee of the Company or any Related Companyof the Company. The individuals and entities described above in this Section 16.12 (other than the Company) shall be third-party beneficiaries of this Plan for purposes of enforcing the terms of this Section 16.12.16.13Notice. Any notice or filing required or permitted to be given to the Committee under this Plan shall be sufficient if in writingand hand-delivered, or sent by registered or certified mail, to the address below:Blucora, Inc.Attn: General Counsel6333 North State Highway 161, 4th FloorIrving, Texas 75038 Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on thepostmark on the receipt for registration or certification.Any notice or filing required or permitted to be given to a Participant under this Plan shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known address of the Participant.16.14Successors. The provisions of this Plan shall bind and inure to the benefit of the Participant's Employer and its successors andassigns and the Participant and the Participant's designated Beneficiaries.16.15Spouse's Interest. The interest in the benefits hereunder of a spouse of a Participant who has predeceased the Participant shallautomatically pass to the Participant and shall not be transferable by such spouse in any manner, including but not limited tosuch spouse's will, nor shall such interest pass under the laws of interstate succession.16.16Validity. In case any provision of this Plan shall be illegal or invalid for any reason, said illegality or invalidity shall not affectthe remaining parts hereof, but this Plan shall be construed and enforced as if such illegal or invalid provision had never beeninserted herein.16.17Incompetent. If the Committee determines in its discretion that a benefit under this Plan is to be paid to a minor, a persondeclared incompetent or to a person incapable of handling the disposition of that person's property, the Committee may directpayment of such benefit to the guardian, legal representative or person having the care and custody of such minor, incompetentor incapable person. The Committee may require proof of minority, incompetence, incapacity or guardianship, as it may deemappropriate prior to distribution of the benefit. Any payment of a benefit shall be a payment for the account of the Participantand the Participant's Beneficiary, as the case may be, and shall be a complete discharge of any liability under the Plan for suchpayment amount.16.18Court Order. The Committee is authorized to make any payments directed by court order in any action in which the Plan orthe Committee has been named as a party. In addition, if a court determines that a spouse or former spouse of a Participant hasan interest in the Participant’s benefits under the Plan in connection with a property settlement or otherwise, the Committee, inits sole discretion, shall have the right, notwithstanding any election made by a Participant, to immediately distribute thespouse's or former spouse's interest in the Participant’s benefits under the Plan to that spouse or former spouse.16.19Distribution in the Event of Income Inclusion Under Code Section 409A or Other Taxation.(a)Code Section 409A. If any portion of a Participant’s Account Balance under this Plan is required to be included inincome by the Participant prior to receipt due to a failure of this Plan to comply with the requirements of Code section409A and related Treasury Regulations, the Committee may determine that such Participant shall receive a distributionfrom the Plan in an amount equal to the lesser of (i) the portion of his or her Account Balance required to be included inincome as a result of the failure of the Plan to comply with the requirements of Code section 409A and related TreasuryRegulations, or (ii) the unpaid vested Account Balance.(b)Trust. If the Trust terminates in accordance with its terms and benefits are distributed from the Trust to a Participant inaccordance therewith, the Participant's benefits under this Plan shall be reduced to the extent of such distributions;provided, however, that such distributions may not occur, if they otherwise would violate Code section 409A and therelated Treasury Regulations.16.20Insurance. The Employers, on their own behalf or on behalf of the Trustee of the Trust, and, in their sole discretion, mayapply for and procure insurance on the life of the Participant, in such amounts and in such forms as the Trust may choose. TheEmployers or the Trustee of the Trust, as the case may be, shall be the sole owner and beneficiary of any such insurance. TheParticipant shall have no interest whatsoever in any such policy or policies, and at the request of the Employers shall submit tomedical examinations and supply such information and execute such documents as may be required by the insurance companyor companies to whom the Employers have applied for insurance.16.21Legal Fees To Enforce Rights After Change in Control. The Company and each Employer is aware that upon theoccurrence of a Change in Control, the Board of the Company or the Board of a Participant’s Employer (which might then becomposed of new members) or a stockholder of the Company or the Participant’s Employer, or of any successor corporationmight then cause or attempt to cause the Company, the Participant’s Employer or such successor to refuse to comply with itsobligations under the Plan and might cause or attempt to cause the Company or the Participant’s Employer to institute, or mayinstitute, litigation seeking to deny Participants the benefits intended under the Plan. In these circumstances, the purpose of thePlan could be frustrated. Accordingly, if, following a Change in Control, it should appear to any Participant that the Company,the Participant’s Employer or any successor corporation has failed to comply with any of its obligations under the Plan or anyagreement thereunder or, if the Company, such Employer or any other person takes any action to declare the Plan void orunenforceable or institutes any litigation or other legal action designed to deny, diminish or to recover from any Participant thebenefits intended to be provided, then the Company and the Participant’s Employer irrevocably authorize such Participant toretain counsel of his or her choice at the expense of the Company and the Participant’s Employer (who shall be jointly andseverally liable) to represent such Participant in connection with the initiation or defense of any litigation or other legal action,whether by or against the Company, the Participant’s Employer or any director, officer, stockholder or other person affiliatedwith the Company, the Participant’s Employer or any successor thereto in any jurisdiction. The amount of fees and expenseseligible for reimbursement during a calendar year shall not affect the fees and expenses eligible for reimbursement in any othercalendar year. Reimbursement of eligible fees and expenses shall be made on or before the last day of the calendar yearfollowing the calendar year in which the fees or expenses were incurred.16.22Formal Action by an Employer. Any formal action herein permitted or required to be taken by the Company or an Employershall be:(a)if and when a partnership, by written instrument executed by one or more of its general partners or by written instrumentexecuted by a person or group of persons who has been authorized by written instrument executed by one or moregeneral partners as having authority to take such action;(b)if and when a partnership, by written instrument executed by one or more of its general partners or by written instrumentexecuted by a person or group of persons who has been authorized by written instrument executed by one or moregeneral partners as having authority to take such action;(c)if and when a proprietorship, by written instrument executed by the proprietor or by written instrument executed by aperson or group of persons who has been authorized by written instrument executed by the proprietor as havingauthority to take such action;(d)if and when a corporation, by resolution of its board of directors or other governing board, or by written instrumentexecuted by a person or group of persons who has been authorized by resolution of its board of directors or othergoverning board as having authority to take such action; or(e)if and when a joint venture, by written instrument executed by one of the joint venturers or by written instrumentexecuted by a person or group of persons who has been authorized by written instrument executed by one of the jointventurers as having authority to take such action.* * * * * * * *[Remainder of Page Intentionally Left Blank.Signature Page Follows.]--Blucora Tax-Smart Executive Deferral PlanIN WITNESS WHEREOF, the Company has signed this Plan document as of December 13, 2018, to be effective as of theEffective Date.CompanyBlucora, Inc.,a Delaware corporationBy: John S. Clendening Name: John S. Clendening Title: President and CEO 4842-1954-1370 v.4 Signature Page to the Blucora Executive Tax-Smart Deferral PlanExhibit 21.1Subsidiaries of the registrantGo2Net, Inc., a Delaware corporationHDV Holdings, Inc., a Delaware corporationH.D. Vest, Inc., a Texas corporationH.D. Vest Investment Securities, Inc., a Texas corporationH.D. Vest Advisory Services, Inc., a Texas corporationH.D. Vest Insurance Agency LLC, a Massachusetts Limited Liability CompanyH.D. Vest Insurance Agency LLC, a Montana Limited Liability CompanyH.D. Vest Insurance Agency LLC, a Texas Limited Liability CompanyProject Baseball Sub, Inc., a Delaware corporationTaxAct Holdings, Inc., a Delaware corporationTaxAct, Inc., an Iowa corporationTaxSmart Research, LLC, a Delaware corporationFinancial BluPrint, LLC, a Delaware corporationSimpleTax Software, Inc., a British Columbia corporationExhibit 23.1CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMWe consent to the incorporation by reference in the following Registration Statements:•Registration Statement (Form S-8 No. 333-169691) pertaining to the Blucora, Inc. Restated 1996 Flexible Stock Incentive Plan,•Registration Statement (Form S-8 No. 333-198645) pertaining to the Blucora, Inc. Restated 1996 Flexible Stock Incentive Plan,•Registration Statement (Form S-8 No. 333-204585) pertaining to the Blucora, Inc. 2015 Incentive Plan,•Registration Statement (Form S-8 No. 333-209218) pertaining to the Blucora, Inc. 2016 Equity Inducement Plan,•Registration Statement (Form S-8 No. 333-214117) pertaining to the Blucora, Inc. 2016 Equity Inducement Plan,•Registration Statement (Form S-8 No. 333-211625) pertaining to the Blucora, Inc., 2015 Incentive Plan as Amended and Restated and 2016Employee Stock Purchase Plan, and•Registration Statement (Form S-3 No. 333-216984) pertaining to the resale of shares of common stock of Blucora, Inc. by certain sellingstockholders;•Registration Statement (Form S-8 No. 333- 225495) pertaining to the Blucora, Inc 2018 Incentive Planof our reports dated March 1, 2019, with respect to the consolidated financial statements of Blucora, Inc. and the effectiveness of internal control overfinancial reporting of Blucora, Inc. included in this Annual Report (Form 10-K) of Blucora, Inc., for the year ended December 31, 2018./s/ ERNST & YOUNG LLPDallas, TexasMarch 1, 2019Exhibit 31.1CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICERPURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002(EXCHANGE ACT RULES 13a-14(a) and 15d-14(a))I, John S. Clendening, certify that:1.I have reviewed this Annual Report on Form 10-K of Blucora, Inc.;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by thisreport;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known tous by others within those entities, particularly during the period in which this report is being prepared;b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designedunder our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally accepted accounting principles; c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusionsabout the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on suchevaluation; andd.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’smost recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or isreasonably likely to materially affect, the registrant’s internal control over financial reporting; and5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, tothe registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting whichare reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; andb.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’sinternal control over financial reporting.Dated: March 1, 2019 /s/ John S. Clendening John S. Clendening Chief Executive Officer and President(Principal Executive Officer)Exhibit 31.2CERTIFICATION OF PRINCIPAL FINANCIAL OFFICERPURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002(EXCHANGE ACT RULES 13a-14(a) and 15d-14(a))I, Davinder Athwal, certify that:1.I have reviewed this Annual Report on Form 10-K of Blucora, Inc.;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by thisreport;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known tous by others within those entities, particularly during the period in which this report is being prepared;b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designedunder our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally accepted accounting principles;c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusionsabout the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on suchevaluation; andd.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’smost recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or isreasonably likely to materially affect, the registrant’s internal control over financial reporting; and5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, tothe registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting whichare reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; andb.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’sinternal control over financial reporting.Dated: March 1, 2019 /s/ Davinder Athwal Davinder Athwal Chief Financial Officer(Principal Financial Officer)Exhibit 32.1CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICERPURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002(18 U.S.C. SECTION 1350)I, John S. Clendening, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that theAnnual Report on Form 10-K of Blucora, Inc. for the year ended December 31, 2018 fully complies with the requirements of Section 13(a) or 15(d) of theSecurities Exchange Act of 1934 and that information contained in such Annual Report on Form 10-K fairly presents, in all material respects, the financialcondition and results of operations of Blucora, Inc.Dated: March 1, 2019 By:/s/ John S. Clendening Name:John S. Clendening Title:Chief Executive Officer and President(Principal Executive Officer)Exhibit 32.2CERTIFICATION OF PRINCIPAL FINANCIAL OFFICERPURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002(18 U.S.C. SECTION 1350)I, Davinder Athwal, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that theAnnual Report on Form 10-K of Blucora, Inc. for the year ended December 31, 2018 fully complies with the requirements of Section 13(a) or 15(d) of theSecurities Exchange Act of 1934 and that information contained in such Annual Report on Form 10-K fairly presents, in all material respects, the financialcondition and results of operations of Blucora, Inc.Dated: March 1, 2019 By:/s/ Davinder Athwal Name:Davinder Athwal Title:Chief Financial Officer(Principal Financial Officer)

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