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                               MITEK SYSTEMS, INC.

                          SECURITIES PURCHASE AGREEMENT

                                  June 11, 2004




                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

1.       Agreement to Sell and Purchase........................................3

2.       Fees and Warrant......................................................3

3.       Closing, Delivery and Payment.........................................4
         3.1      Closing......................................................4
         3.2      Delivery.....................................................4

4.       Representations and Warranties of the Company.........................4
         4.1      Organization, Good Standing and Qualification................4
         4.2      Subsidiaries.................................................5
         4.3      Capitalization; Voting Rights................................5
         4.4      Authorization; Binding Obligations...........................6
         4.5      Liabilities..................................................6
         4.6      Agreements; Action...........................................6
         4.7      Obligations to Related Parties...............................7
         4.8      Changes......................................................8
         4.9      Title to Properties and Assets; Liens, Etc...................9
         4.10     Intellectual Property........................................9
         4.11     Compliance with Other Instruments...........................10
         4.12     Litigation..................................................10
         4.13     Tax Returns and Payments....................................10
         4.14     Employees...................................................10
         4.15     Registration Rights and Voting Rights.......................11
         4.16     Compliance with Laws; Permits...............................11
         4.17     Environmental and Safety Laws ..............................11
         4.18     Valid Offering..............................................12
         4.19     Full Disclosure.............................................12
         4.20     Insurance...................................................12
         4.21     SEC Reports.................................................12
         4.22     Listing.....................................................13
         4.23     No Integrated Offering......................................13
         4.24     Stop Transfer...............................................13
         4.25     Dilution....................................................13
         4.26     Patriot Act.................................................13

5.       Representations and Warranties of the Purchaser......................14
         5.1      No Shorting.................................................14
         5.2      Requisite Power and Authority...............................14
         5.3      Investment Representations..................................14
         5.4      Purchaser Bears Economic Risk...............................15
         5.5      Acquisition for Own Account.................................15
         5.6      Purchaser Can Protect Its Interest..........................15
         5.7      Accredited Investor ........................................15


                                        1


         5.8      Legends.....................................................15

6.       Covenants of the Company.............................................16
         6.1      Stop-Orders.................................................16
         6.2      Listing.....................................................16
         6.3      Market Regulations..........................................17
         6.4      Reporting Requirements......................................17
         6.5      Use of Funds................................................17
         6.6      Access to Facilities........................................17
         6.7      Taxes ......................................................17
         6.8      Insurance...................................................17
         6.9      Intellectual Property.......................................18
         6.10     Properties..................................................19
         6.11     Required Approvals..........................................19
         6.12     Reissuance of Securities....................................20
         6.13     Opinion ....................................................20
         6.14     Margin Stock................................................20

7.       Covenants of the Purchaser...........................................21
         7.1      Confidentiality ............................................21
         7.2      Non-Public Information......................................21

8.       Covenants of the Company and Purchaser Regarding Indemnification.....21
         8.1      Company Indemnification.....................................21
         8.2      Purchaser's Indemnification.................................21

9.       Conversion of Convertible Note.......................................21
         9.1      Mechanics of Conversion.....................................21

10.      Registration Rights..................................................23
         10.1     Registration Rights Granted.................................23
         10.2     Offering Restrictions.......................................23

11.      Miscellaneous........................................................23
         11.1     Governing Law...............................................23
         11.2     Survival....................................................24
         11.3     Successors..................................................24
         11.4     Entire Agreement............................................24
         11.5     Severability................................................24
         11.6     Amendment and Waiver........................................24
         11.7     Delays or Omissions.........................................24
         11.8     Notices.....................................................24
         11.9     Attorneys' Fees.............................................26
         11.10    Titles and Subtitles........................................26
         11.11    Facsimile Signatures; Counterparts..........................26
         11.12    Broker's Fees...............................................26
         11.13    Construction................................................26


                                       2


                          SECURITIES PURCHASE AGREEMENT

         THIS  SECURITIES  PURCHASE  AGREEMENT  (this  "Agreement")  is made and
entered into as of June 11, 2004, by and between MITEK SYSTEMS, INC., a Delaware
corporation  (the  "Company"),  and Laurus Master Fund,  Ltd., a Cayman  Islands
company (the "Purchaser").

                                    RECITALS

         WHEREAS,  the Company has  authorized  the sale to the  Purchaser  of a
Convertible Term Note in the aggregate principal amount of Three Million Dollars
($3,000,000  ) (the  "Note"),  which  Note is  convertible  into  shares  of the
Company's  common stock,  $0.001 par value per share (the "Common  Stock") at an
initial  fixed  conversion  price of $0.70  per share of  Common  Stock  ("Fixed
Conversion Price");

         WHEREAS,  the  Company  wishes to issue a warrant to the  Purchaser  to
purchase  up to  860,000  shares  of the  Company's  Common  Stock  (subject  to
adjustment as set forth therein) in connection with Purchaser's  purchase of the
Note;

         WHEREAS,  Purchaser  desires to  purchase  the Note and the Warrant (as
defined in Section 2) on the terms and conditions set forth herein; and

         WHEREAS,  the Company desires to issue and sell the Note and Warrant to
Purchaser on the terms and conditions set forth herein.

                                    AGREEMENT

         NOW,  THEREFORE,  in  consideration  of the foregoing  recitals and the
mutual promises, representations, warranties and covenants hereinafter set forth
and for other good and valuable  consideration,  the receipt and  sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:

         1.  Agreement  to  Sell  and  Purchase1.  Pursuant  to  the  terms  and
conditions  set forth in this  Agreement,  on the  Closing  Date (as  defined in
Section  3), the  Company  agrees to sell to the  Purchaser,  and the  Purchaser
hereby  agrees to purchase  from the Company a Note in the  aggregate  principal
amount of  $3,000,000  convertible  in  accordance  with the terms  thereof into
shares of the Company's  Common Stock in  accordance  with the terms of the Note
and this Agreement. The Note purchased on the Closing Date shall be known as the
"Offering."  A form of the Note is  annexed  hereto as  Exhibit A. The Note will
mature on the Maturity Date (as defined in the Note). Collectively, the Note and
Warrant and Common Stock issuable in payment of the Note, upon conversion of the
Note and upon exercise of the Warrant are referred to as the "Securities."

         2. Fees and Warrant. On the Closing Date:

                  (a)  The  Company  will issue and  deliver to the  Purchaser a
Warrant to purchase up to 860,000 shares of Common Stock in connection  with the


                                       3


Offering  (the  "Warrant")  pursuant to Section 1 hereof.  The  Warrant  must be
delivered on the Closing Date. A form of Warrant is annexed hereto as Exhibit B.
To the  extent  applicable,  All  the  representations,  covenants,  warranties,
undertakings, and indemnification herein, and other rights made or granted to or
for the benefit of the Purchaser by the Company  herein are hereby also made and
granted in respect of the Warrant on the date hereof.

                  (b)  Subject to the terms of Section  2(d) below,  the Company
shall pay to Laurus Capital  Management,  LLC,  manager of Purchaser,  a closing
payment  in an  amount  equal to  three  and  one-half  percent  (3.50%)  of the
aggregate  principal amount of the Note. The foregoing fee is referred to herein
as the "Closing Payment."

                  (c)   The  Company  shall  reimburse  the  Purchaser  for  its
reasonable  expenses  (including legal fees and expenses) incurred in connection
with  the  preparation  and  negotiation  of  this  Agreement  and  the  Related
Agreements (as hereinafter  defined),  and expenses  incurred in connection with
the Purchaser's  due diligence  review of the Company and its  Subsidiaries  (as
defined in Section  6.8) and all related  matters.  Amounts  required to be paid
under this  Section  2(c) will be paid on the Closing  Date and shall be $29,500
for such expenses referred to in this Section 2(c).

                  (d)  The Closing  Payment and the expenses  referred to in the
preceding  clause (c) (net of deposits  previously paid by the Company) shall be
paid at closing out of funds held  pursuant to a Funds Escrow  Agreement of even
date  herewith  among the  Company,  Purchaser,  and an Escrow Agent (the "Funds
Escrow Agreement") and a disbursement letter (the "Disbursement Letter").

         3. Closing, Delivery and Payment3. .

                  3.1 Closing.  Subject to the terms and conditions  herein, the
closing of the  transactions  contemplated  hereby (the  "Closing"),  shall take
place on the date hereof, at such time or place as the Company and Purchaser may
mutually agree (such date is hereinafter referred to as the "Closing Date").

                  3.2  Delivery.  Pursuant to the Funds Escrow  Agreement in the
form  attached  hereto as Exhibit D, at the  Closing on the  Closing  Date,  the
Company will deliver to the  Purchaser,  among other things,  a Note in the form
attached as Exhibit A  representing  the principal  amount of  $3,000,000  and a
Warrant in the form attached as Exhibit B in the Purchaser's  name  representing
860,000  Warrant  Shares and the  Purchaser  will deliver to the Company,  among
other  things,  the amounts set forth in the  Disbursement  Letter by  certified
funds or wire transfer.

         4.  Representations  and Warranties of the Company.  The Company hereby
represents and warrants to the Purchaser as follows (which  representations  and
warranties are supplemented by, and subject to, the Company's  filings under the
Securities  Exchange Act of 1934  (collectively,  the "Exchange  Act  Filings"),
copies of which have been provided to the Purchaser:

                  4.1 Organization, Good Standing and Qualification. The Company
is a corporation duly organized, validly existing and in good standing under the


                                       4


laws of its  jurisdiction of  organization.  The Company has the corporate power
and  authority  to own and operate  its  properties  and assets,  to execute and
deliver  (i) this  Agreement,  (ii) the Note and the  Warrant  to be  issued  in
connection  with this  Agreement,  (iii) the Security  Agreement dated as of the
date hereof between the Company and the Purchaser,  (iv) the Registration Rights
Agreement  relating to the  Securities  dated as of the date hereof  between the
Company and the Purchaser,  (v) the Escrow Agreement dated as of the date hereof
among the Company,  the Purchaser  and the escrow agent  referred to therein and
(vi) all other agreements related to this Agreement and the Note and referred to
herein (the  preceding  clauses (ii) through  (vi),  collectively,  the "Related
Agreements"), to issue and sell the Note and the shares of Common Stock issuable
upon conversion of the Note (the "Note  Shares"),  to issue and sell the Warrant
and the Warrant  Shares,  and to carry out the  provisions of this Agreement and
the Related Agreements and to carry on its business as presently conducted.  The
Company  is duly  qualified  and is  authorized  to do  business  and is in good
standing  as a  foreign  corporation  in all  jurisdictions,  except  for  those
jurisdictions in which the failure to do so has not had, or could not reasonably
be expected to have, individually or in the aggregate, a material adverse effect
on  the  business,  assets,   liabilities,   financial  condition,   properties,
operations of the Company (a "Material Adverse Effect").

                  4.2 Subsidiaries.  Each direct and indirect  Subsidiary of the
Company,  the  direct  owner of such  Subsidiary  and its  percentage  ownership
thereof,  is set forth on Schedule  4.2.  For the purpose of this  Agreement,  a
"Subsidiary"  of any person or entity  means (i) a  corporation  or other entity
whose shares of stock or other ownership  interests having ordinary voting power
(other than stock or other ownership  interests having such power only by reason
of the happening of a contingency)  to elect a majority of the directors of such
corporation,  or other persons or entities performing similar functions for such
person or entity, are owned, directly or indirectly, by such person or entity or
(ii) a corporation or other entity in which such person or entity owns, directly
or indirectly, more than 50% of the equity interests at such time.

                  4.3 Capitalization; Voting Rights.

                  (a)  The  authorized  capital stock of the Company,  as of the
date hereof,  consists of 21,000,000  shares,  of which 20,000,000 are shares of
Common Stock, par value $0.001 per share,  11,389,481shares of which were issued
and outstanding as of May 12, 2004, and 1,000,000 are shares of preferred stock,
par value $0.001 per share, of which no shares are issued and outstanding.

                  (b)  Except as disclosed on Schedule 4.3,  other than: (i) the
shares  reserved for issuance under the Company's  stock option plans;  and (ii)
shares  which  may  be  issued  pursuant  to  this  Agreement  and  the  Related
Agreements,  there  are no  outstanding  options,  warrants,  rights  (including
conversion  or  preemptive  rights  and  rights  of  first  refusal),  proxy  or
stockholder  agreements,  or  arrangements  or  agreements  of any  kind for the
purchase or  acquisition  from the Company of any of its  securities.  Except as
disclosed  on Schedule  4.3,  neither the offer,  issuance or sale of any of the
Note or Warrant,  or the  issuance of any of the Note Shares or Warrant  Shares,
nor the  consummation  of any transaction  contemplated  hereby will result in a
change  in the price or number of any  securities  of the  Company  outstanding,
under  anti-dilution or other similar  provisions  contained in or affecting any
such securities.


                                       5


                  (c)  All issued and outstanding shares of the Company's Common
Stock:  (i) have been duly  authorized and validly issued and are fully paid and
nonassessable;  and (ii) were issued in compliance with all applicable state and
federal laws concerning the issuance of securities.

                  (d)  The rights,  preferences,  privileges and restrictions of
the shares of the Common  Stock are as stated in the  Company's  Certificate  of
Incorporation (the "Charter"). The Note Shares and Warrant Shares have been duly
and validly reserved for issuance. When issued in compliance with the provisions
of this Agreement and the Company's Charter and, as applicable, the Note and the
Warrant,  the Securities will be validly issued,  fully paid and  nonassessable,
and  will be free of any  liens or  encumbrances;  provided,  however,  that the
Securities may be subject to restrictions on transfer under state and/or federal
securities laws as set forth herein or as otherwise required by such laws at the
time a transfer is proposed.

                  4.4 Authorization;  Binding Obligations.  All corporate action
on the  part of the  Company,  its  officers  and  directors  necessary  for the
authorization of this Agreement and the Related  Agreements,  the performance of
all obligations of the Company hereunder and under the Related Agreements at the
Closing  and,  the  authorization,  sale,  issuance and delivery of the Note and
Warrant has been taken or will be taken prior to the Closing. This Agreement and
the Related  Agreements,  when  executed and delivered and to the extent it is a
party thereto,  will be valid and binding obligations of the Company enforceable
in accordance with their terms, except:

                  (a)   as  limited  by   applicable   bankruptcy,   insolvency,
reorganization,  moratorium  or  other  laws of  general  application  affecting
enforcement of creditors' rights; and

                  (b)   general   principles   of  equity  that   restrict   the
availability of equitable or legal remedies.

                  (c) The sale of the Note and the subsequent  conversion of the
Note into Note Shares are not and will not be subject to any  preemptive  rights
or rights of first refusal that have not been properly  waived or complied with.
The  issuance  of the  Warrant  and the  subsequent  exercise of the Warrant for
Warrant  Shares  are not and will not be  subject  to any  preemptive  rights or
rights of first refusal that have not been properly waived or complied with.

                  4.5  Liabilities.  The  Company  does not have any  contingent
liabilities,  except  current  liabilities  incurred in the  ordinary  course of
business and liabilities disclosed in any Exchange Act Filings.

                  4.6 Agreements; Action. Except as set forth on Schedule 4.6 or
as disclosed in any Exchange Act Filings:

                  (a)  There  are no  agreements,  understandings,  instruments,
contracts,  judgments,  orders, writs or decrees to which the Company is a party
or to its  knowledge  by which it is bound which may  involve:  (i)  obligations
(contingent  or otherwise)  of, or payments to, the Company in excess of $50,000
(other than obligations of, or payments to, the Company arising from purchase or
sale agreements  entered into in the ordinary  course of business);  or (ii) the
transfer or license of any patent, copyright,  trade secret or other proprietary
right to or from the Company (other than licenses arising in the ordinary course


                                       6


of business from the purchase of "off the shelf" or other  standard  products of
the Company) ; or (iii) provisions  restricting the development,  manufacture or
distribution of the Company's products or services;  or (iv)  indemnification by
the Company in excess of $50,000 in the aggregate with respect to  infringements
of proprietary rights.

                  (b)  Since  September  30,  2003,  the  Company  has not:  (i)
declared or paid any dividends,  or authorized or made any distribution  upon or
with  respect to any class or series of its capital  stock;  (ii)  incurred  any
indebtedness  for money borrowed or any other  liabilities  (other than ordinary
course  obligations)  individually  in  excess  of  $50,000  or,  in the case of
indebtedness  and/or  liabilities  individually less than $50,000,  in excess of
$100,000 in the aggregate; (iii) made any loans or advances to any person not in
excess,  individually or in the aggregate, of $100,000, other than advances made
in the  ordinary  course of business  for travel  expenses  or other  legitimate
business purpose; or (iv) sold, exchanged or otherwise disposed of of its assets
or rights in excess of an  aggregate  consideration  of $25,000,  other than the
sale of its inventory in the ordinary course of business.

                  (c)  For the purposes of  subsections  (a) and (b) above,  all
indebtedness,  liabilities, agreements,  understandings,  instruments, contracts
and proposed transactions involving the same person or entity (including persons
or entities the Company has reason to believe are affiliated therewith) shall be
aggregated for the purpose of meeting the  individual  minimum dollar amounts of
such subsections.

                  4.7  Obligations  to Related  Parties.  Except as set forth on
Schedule 4.7, there are no  obligations  of the Company to officers,  directors,
stockholders or employees of the Company other than:

                  (a) for payment of salary for services  rendered and for bonus
payments;

                  (b) reimbursement  for reasonable  expenses incurred on behalf
of the Company;

                  (c)  for  other  standard  employee  benefits  made  generally
available to all employees (including stock option agreements  outstanding under
any stock option plan approved by the Board of Directors of the Company); and

                  (d) obligations listed in the Company's  financial  statements
or disclosed in any of its Exchange Act Filings.

Except as described  above or set forth on Schedule  4.7,  none of the officers,
directors  of the  Company  or any  members  of their  immediate  families,  are
indebted to the Company,  individually or in the aggregate, in excess of $50,000
or have any direct or indirect  ownership  interest  in any firm or  corporation
with which the  Company is  affiliated  or with which the Company has a business
relationship,  or any firm or corporation which competes with the Company, other
than passive  investments in publicly traded companies  (representing  less than
one percent (1%) of such company) which may compete with the Company.  Except as
described  above, no agreements,  understandings  or proposed  transactions  are
contemplated  between the Company and any  officer,  director,  or any member of
their immediate families directly or indirectly. Except as set forth on Schedule


                                       7


4.7, the Company is not a guarantor or  indemnitor  of any  indebtedness  of any
other person, firm or corporation.

                  4.8 Changes.  Since September 30, 2003, except as disclosed in
any Exchange  Act Filing or in any  Schedule to this  Agreement or to any of the
Related Agreements, there has not been:

                  (a) any change in the business, assets, liabilities, financial
condition,  properties or operations of the Company,  which,  individually or in
the aggregate, has had or could reasonably be expected to have, a Material
Adverse Effect;

                  (b) any  resignation or termination of any officer or group of
employees of the Company;

                  (c)  any material  change,  except in the  ordinary  course of
business,  in the  contingent  obligations  of the  Company by way of  guaranty,
endorsement, indemnity, warranty or otherwise;

                  (d) any damage, destruction or loss, whether or not covered by
insurance,  which has had, or could reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect;

                  (e) to the Company's knowledge,  after due inquiry, any waiver
by the Company of a valuable right or of a material debt owed to it;

                  (f)  any direct or indirect material loans made by the Company
to any  stockholder,  employee,  officer or director of the Company,  other than
advances made in the ordinary course of business;

                  (g) any material  change in any  compensation  arrangement  or
agreement with any employee, officer, director or stockholder;

                  (h) any  declaration  or  payment  of any  dividend  or  other
distribution of the assets of the Company;

                  (i)  to  the  Company's  knowledge,   any  labor  organization
activity related to the Company;

                  (j) any debt,  obligation  or liability  incurred,  assumed or
guaranteed by the Company,  except those for immaterial  amounts and for current
liabilities incurred in the ordinary course of business;

                  (k)  any  sale,   assignment   or  transfer  of  any  patents,
trademarks, copyrights, trade secrets or other intangible assets;

                  (l) any change in any material  agreement to which the Company
is a  party  or by  which  it is  bound  which,  either  individually  or in the
aggregate,  has had, or could reasonably be expected to have, a Material Adverse
Effect;


                                       8


                  (m) any other event or condition of any character that, either
individually  or in the aggregate,  has had, or could  reasonably be expected to
have, a Material Adverse Effect; or

                  (n) any  arrangement or commitment by the Company to do any of
the acts described in subsection (a) through (m) above.

                  4.9 Title to Properties and Assets;  Liens, Etc. Except as set
forth  on  Schedule  4.9,  the  Company  has good  and  marketable  title to its
properties  and assets,  and good title to its leasehold  estates,  in each case
subject to no mortgage, pledge, lien, lease, encumbrance or charge, other than:

                  (a) those  resulting  from  taxes  which  have not yet  become
delinquent;

                  (b)  minor  liens  and  encumbrances  which do not  materially
detract from the value of the property subject thereto or materially  impair the
operations of the Company; and

                  (c) those that have otherwise arisen in the ordinary course of
business.

All facilities,  machinery,  equipment,  fixtures, vehicles and other properties
owned,  leased or used by the Company are in good operating condition and repair
(except for ordinary  wear and tear) and are  reasonably  fit and usable for the
purposes for which they are being used. Except as set forth on Schedule 4.9, the
Company is in compliance  with all material terms of each lease to which it is a
party or is otherwise bound.

                  4.10 Intellectual Property.

                  (a)  The Company owns or possesses  sufficient legal rights to
all patents, trademarks,  service marks, trade names, copyrights, trade secrets,
licenses,  information and other proprietary rights and processes  necessary for
its  business as now  conducted  and to the  Company's  knowledge  as  presently
proposed  to be  conducted  (the  "Intellectual  Property"),  without  any known
infringement of the rights of others. There are no outstanding options, licenses
or agreements of any kind relating to the foregoing  proprietary  rights, nor is
the Company  bound by or a party to any options,  licenses or  agreements of any
kind with  respect to the  patents,  trademarks,  service  marks,  trade  names,
copyrights,  trade secrets,  licenses,  information and other proprietary rights
and  processes  of any other  person  or entity  other  than  such  licenses  or
agreements  arising from the purchase of "off the shelf" or standard products of
the Company.

                  (b)  The Company has not received any communications  alleging
that the Company has  violated any of the patents,  trademarks,  service  marks,
trade names,  copyrights  or trade  secrets or other  proprietary  rights of any
other person or entity, nor is the Company aware of any basis therefor.

                  (c) The Company does not believe it is or will be necessary to
utilize any inventions,  trade secrets or proprietary  information of any of its
employees made prior to their employment by the Company,  except for inventions,
trade secrets or proprietary  information that have been rightfully  assigned to
the Company.


                                       9


                  4.11 Compliance with Other Instruments.  The Company is not in
violation  or  default of (x) any term of its  Charter or Bylaws,  or (y) of any
provision  of any  indebtedness,  mortgage,  indenture,  contract,  agreement or
instrument  to which  it is  party  or by which it is bound or of any  judgment,
decree,  order or writ,  which violation or default,  in the case of this clause
(y), has had, or could reasonably be expected to have, either individually or in
the aggregate,  a Material  Adverse  Effect.  Other than as contemplated by this
Agreement and the Related Agreements, the execution, delivery and performance of
and compliance  with this Agreement and the Related  Agreements to which it is a
party,  and the  issuance  and sale of the  Note by the  Company  and the  other
Securities  by the Company each pursuant  hereto and thereto,  will not, with or
without  the  passage of time or giving of notice,  result in any such  material
violation, or be in conflict with or constitute a default under any such term or
provision, or result in the creation of any mortgage,  pledge, lien, encumbrance
or charge upon any of the properties or assets of the Company or the suspension,
revocation,  impairment,  forfeiture  or  nonrenewal  of  any  permit,  license,
authorization or approval applicable to the Company,  its business or operations
or any of its  assets  or  properties  which  has had,  or could  reasonably  be
expected to have,  either  individually or in the aggregate,  a Material Adverse
Effect.

                  4.12 Litigation.  Except as set forth on Schedule 4.12 hereto,
there is no  action,  suit,  proceeding  or  investigation  pending  or,  to the
Company's knowledge,  currently threatened against the Company that prevents the
Company from entering  into this  Agreement or the Related  Agreements,  or from
consummating the transactions  contemplated hereby or thereby, or which has had,
or  could  reasonably  be  expected  to  have,  either  individually  or in  the
aggregate,  a  Material  Adverse  Effect or could  result  in any  change in the
current equity ownership of the Company,  nor is the Company aware that there is
any basis to assert any of the foregoing.  The Company is not a party or subject
to the  provisions  of any order,  writ,  injunction,  judgment or decree of any
court  or  government  agency  or  instrumentality.  There is no  action,  suit,
proceeding  or  investigation  by the  Company  currently  pending  or which the
Company intends to initiate.

                  4.13 Tax Returns and  Payments.  The Company has timely  filed
all tax returns (federal, state and local) required to be filed by it. All taxes
shown to be due and payable on such returns,  any assessments  imposed,  and all
other taxes due and payable by the Company on or before the  Closing,  have been
paid or will be paid  prior to the time they  become  delinquent.  Except as set
forth on Schedule 4.13, the Company has not been advised:

                  (a) that any of its  returns,  federal,  state or other,  have
been or are being audited as of the date hereof; or

                  (b) of any  deficiency in  assessment or proposed  judgment to
its federal, state or other taxes.

The Company has no knowledge of any  liability of any tax to be imposed upon its
properties  or assets as of the date of this  Agreement  that is not  adequately
provided for.

                  4.14  Employees.  Except as set forth on  Schedule  4.14,  the
Company has no collective bargaining agreements with any of its employees. There
is no labor union organizing  activity  pending or, to the Company's  knowledge,
threatened with respect to the Company.  Except as disclosed in the Exchange Act


                                       10


Filings  or on  Schedule  4.14,  the  Company  is not a party to or bound by any
currently effective  employment  contract,  deferred  compensation  arrangement,
bonus plan,  incentive plan, profit sharing plan,  retirement agreement or other
employee compensation plan or agreement. To the Company's knowledge, no employee
of the Company,  nor any consultant with whom the Company has contracted,  is in
violation  of any  term  of any  employment  contract,  proprietary  information
agreement or any other agreement relating to the right of any such individual to
be employed by, or to contract  with,  the Company  because of the nature of the
business to be conducted  by the Company;  and to the  Company's  knowledge  the
continued  employment  by  the  Company  of  its  present  employees,   and  the
performance of the Company's  contracts with its independent  contractors,  will
not  result in any such  violation.  The  Company  is not aware  that any of its
employees is  obligated  under any contract  (including  licenses,  covenants or
commitments  of any  nature) or other  agreement,  or  subject to any  judgment,
decree or order of any court or administrative agency, that would interfere with
their  duties to the Company.  The Company has not received any notice  alleging
that any such  violation has  occurred.  Except for employees who have a current
effective employment agreement with the Company, except as set forth on Schedule
4.14 hereto,  no employee of the Company has been granted the right to continued
employment by the Company or to any material compensation  following termination
of  employment  with the  Company . Except as set forth on  Schedule  4.14,  the
Company  is not aware  that any  officer,  key  employee  or group of  employees
intends to terminate his, her or their employment with the Company, nor does the
Company have a present intention to terminate the employment of any officer, key
employee or group of employees.

                  4.15  Registration  Rights  and Voting  Rights.  Except as set
forth on Schedule  4.15 and except as disclosed  in Exchange  Act  Filings,  the
Company is presently not under any  obligation,  and has not granted any rights,
to register any of the Company's presently outstanding  securities or any of its
securities  that may  hereafter be issued.  Except as set forth on Schedule 4.15
and except as disclosed in Exchange Act Filings, to the Company's knowledge,  no
stockholder  of the Company has entered into any  agreement  with respect to the
voting of equity securities of the Company.

                  4.16  Compliance  with Laws;  Permits.  The  Company is not in
violation of any applicable statute, rule,  regulation,  order or restriction of
any domestic or foreign  government or any  instrumentality or agency thereof in
respect of the conduct of its business or the ownership of its properties  which
has had, or could reasonably be expected to have, either  individually or in the
aggregate,  a Material  Adverse  Effect.  No governmental  orders,  permissions,
consents,  approvals  or  authorizations  are  required  to be  obtained  and no
registrations  or  declarations  are required to be filed in connection with the
execution  and  delivery  of this  Agreement  or any Related  Agreement  and the
issuance  of any of the  Securities,  except  such as has been duly and  validly
obtained or filed,  or with  respect to any filings  that must be made after the
Closing,  as will be filed in a timely  manner.  The  Company  has all  material
franchises,  permits,  licenses  and any  similar  authority  necessary  for the
conduct of its  business as now being  conducted by it, the lack of which could,
either  individually  or in the  aggregate,  reasonably  be  expected  to have a
Material Adverse Effect.

                  4.17 Environmental and Safety Laws. To the Company's knowledge
after due and careful inquiry, the Company is not in violation of any applicable
statute,  law or regulation  relating to the environment or occupational  health


                                       11


and  safety,  and to its  knowledge,  no  material  expenditures  are or will be
required in order to comply with any such existing  statute,  law or regulation.
Except as set forth on Schedule 4.17, no Hazardous  Materials (as defined below)
are used or have been used,  stored,  or  disposed  of by the Company or, to the
Company's knowledge, by any other person or entity on any property owned, leased
or used by the Company.  For the purposes of the preceding sentence,  "Hazardous
Materials" shall mean:

                  (a)  materials  which  are  listed  or  otherwise  defined  as
"hazardous" or "toxic" under any applicable local, state, federal and/or foreign
laws and regulations that govern the existence and/or remedy of contamination on
property,  the protection of the environment from contamination,  the control of
hazardous wastes, or other activities involving hazardous substances,  including
building materials; or

                  (b) any petroleum products or nuclear materials.

                  4.18   Valid   Offering.   Assuming   the   accuracy   of  the
representations and warranties of the Purchaser contained in this Agreement, the
offer,  sale and issuance of the Securities will be exempt from the registration
requirements of the Securities Act of 1933, as amended (the  "Securities  Act"),
and will have been registered or qualified (or are exempt from  registration and
qualification) under the registration,  permit or qualification  requirements of
all applicable state securities laws.

                  4.19 Full  Disclosure.  The Company has provided the Purchaser
with all information  requested by the Purchaser in connection with its decision
to purchase the Note and Warrant, including all information the Company believes
is  reasonably  necessary  to  make  such  investment  decision.   Neither  this
Agreement,  the Related  Agreements  nor the exhibits and  schedules  hereto and
thereto nor any other  document  delivered  by the Company to  Purchaser  or its
attorneys or agents in connection herewith or therewith or with the transactions
contemplated hereby or thereby,  contain any untrue statement of a material fact
nor omit to state a  material  fact  necessary  in order to make the  statements
contained  herein or therein,  in light of the  circumstances  in which they are
made, not misleading.  Any financial projections and other estimates provided to
the  Purchaser  by the Company  were based on the  Company's  experience  in the
industry and on  assumptions  of fact and opinion as to future  events which the
Company, at the date of the issuance of such projections or estimates,  believed
to be reasonable.

                  4.20 Insurance.  The Company has general  commercial,  product
liability, fire and casualty insurance policies with coverages which the Company
believes are customary for  companies  similarly  situated to the Company in the
same or similar business.

                  4.21 SEC Reports.  Except as set forth on Schedule  4.21,  the
Company has filed all proxy statements,  reports and other documents required to
be filed by it under the Securities Exchange Act 1934, as amended (the "Exchange
Act").  The Company has  furnished or made  available to the  Purchaser  via the
EDGAR System copies of: (i) its Annual Report on Form 10-KSB for the fiscal year
ended September 30, 2003 ; and (ii) its Quarterly Reports on Form 10-QSB for the
fiscal  quarters  ended  December 31, 2003 and March 31, 2004 , and the Form 8-K
filings which it has made during the fiscal year 2003 to date (collectively, the
"SEC  Reports").  Except as set forth on Schedule 4.21,  each SEC Report was, at


                                       12


the time of its filing,  in substantial  compliance with the requirements of its
respective form and none of the SEC Reports,  nor the financial  statements (and
the notes thereto)  included in the SEC Reports,  as of their respective  filing
dates,  contained any untrue  statement of a material fact or omitted to state a
material fact required to be stated  therein or necessary to make the statements
therein,  in  light  of the  circumstances  under  which  they  were  made,  not
misleading.

                  4.22 Trading.  The Company's Common Stock is traded on the OTC
Bulletin Board ("OTCBB") and satisfies all  requirements for the continuation of
such trading. The Company has not received any notice that its Common Stock will
be  ineligible  to be traded on the OTCBB or that its Common Stock does not meet
all requirements for such continued trading .

                  4.23 No Integrated  Offering.  Neither the Company, nor any of
its  affiliates,  nor any person acting on its or their behalf,  has directly or
indirectly  made any offers or sales of any security or solicited  any offers to
buy any  security  under  circumstances  that would  cause the  offering  of the
Securities  pursuant to this Agreement or any Related Agreement to be integrated
with prior  offerings  by the Company for purposes of the  Securities  Act which
would prevent the Company from selling the Securities pursuant to Rule 506 under
the Securities  Act, or any  applicable  exchange-related  stockholder  approval
provisions,  nor will the Company or any of its affiliates or subsidiaries  take
any  action or steps that  would  cause the  offering  of the  Securities  to be
integrated with other offerings.

                  4.24 Stop Transfer.  The Securities are restricted  securities
as of the date of this  Agreement.  The Company will not issue any stop transfer
order or other order  impeding the sale and  delivery of any of the  Securities,
except as required by applicable state or federal securities laws.

                  4.25 Dilution. The Company specifically  acknowledges that its
obligation  to issue the shares of Common Stock upon  conversion of the Note and
exercise of the Warrant is binding upon the Company and  enforceable  regardless
of the  dilution  such  issuance  may have on the  ownership  interests of other
shareholders of the Company.

                  4.26 Patriot Act. The Company  certifies  that, to the best of
Company's  knowledge,  the Company has not been designated,  and is not owned or
controlled,  by a "suspected terrorist" as defined in Executive Order 13224. The
Company  hereby  acknowledges  that  the  Purchaser  seeks  to  comply  with all
applicable  laws  concerning  money  laundering  and  related   activities.   In
furtherance of those efforts, the Company hereby represents, warrants and agrees
that:  (i)  none of the  cash or  property  that  the  Company  will pay or will
contribute  to the  Purchaser  has been or shall be derived from, or related to,
any  activity  that is deemed  criminal  under  United  States law;  and (ii) no
contribution or payment by the Company to the Purchaser, to the extent that they
are within the Company's control shall cause the Purchaser to be in violation of
the United  States Bank  Secrecy  Act,  the United  States  International  Money
Laundering  Control  Act  of  1986  or the  United  States  International  Money
Laundering Abatement and Anti-Terrorist Financing Act of 2001. The Company shall
promptly notify the Purchaser if any of these representations  ceases to be true
and accurate regarding the Company.  The Company agrees to provide the Purchaser
any  additional  information  regarding  the Company  that the  Purchaser  deems
necessary or convenient to ensure compliance with all applicable laws concerning
money laundering and similar activities. The Company understands and agrees that


                                       13


if at any time it is discovered  that any of the foregoing  representations  are
incorrect,  or if otherwise  required by applicable law or regulation related to
money laundering  similar  activities,  the Purchaser may undertake  appropriate
actions to ensure  compliance with  applicable law or regulation,  including but
not limited to segregation  and/or  redemption of the Purchaser's  investment in
the Company.  The Company  further  understands  that the  Purchaser may release
confidential  information  about the Company and, if applicable,  any underlying
beneficial  owners,  to  proper  authorities  if  the  Purchaser,  in  its  sole
discretion,  determines  that it is in the best  interests  of the  Purchaser in
light of relevant rules and  regulations  under the laws set forth in subsection
(ii) above.

         5.  Representations  and  Warranties  of the  Purchaser.  The Purchaser
hereby  represents and warrants to the Company as follows (such  representations
and  warranties do not lessen or obviate the  representations  and warranties of
the Company set forth in this Agreement)

                  5.1 No Shorting.  The Purchaser or any of its  affiliates  and
investment  partners has not,  will not and will not cause any person or entity,
directly or indirectly, to engage in "short sales" of the Company's Common Stock
or any other hedging strategies  utilizing the Company's Common Stock as long as
the Note shall be outstanding.

                  5.2  Requisite  Power and  Authority.  The  Purchaser  has all
necessary power and authority under all applicable  provisions of law to execute
and deliver this  Agreement  and the Related  Agreements  and to carry out their
provisions.  All corporate  action on  Purchaser's  part required for the lawful
execution and delivery of this Agreement and the Related Agreements have been or
will be  effectively  taken  prior to the  Closing.  Upon  their  execution  and
delivery,  this Agreement and the Related  Agreements  will be valid and binding
obligations of Purchaser, enforceable in accordance with their terms, except:

                  (a)   as  limited  by   applicable   bankruptcy,   insolvency,
reorganization,  moratorium  or  other  laws of  general  application  affecting
enforcement of creditors' rights; and

                  (b) as limited by general  principles  of equity that restrict
the availability of equitable and legal remedies.

                  5.3 Investment Representations. Purchaser understands that the
Securities are being offered and sold pursuant to an exemption from registration
contained in the Securities Act based in part upon  Purchaser's  representations
contained in the Agreement, including, without limitation, that the Purchaser is
an "accredited investor" within the meaning of Regulation D under the Securities
Act of 1933, as amended (the "Securities  Act"). The Purchaser  confirms that it
has  received  or has had  full  access  to all  the  information  it  considers
necessary or appropriate to make an informed investment decision with respect to
the Note and the Warrant to be purchased by it under this Agreement and the Note
Shares and the Warrant Shares acquired by it upon the conversion of the Note and
the exercise of the Warrant,  respectively.  The Purchaser further confirms that
it has had an opportunity to ask questions and receive  answers from the Company
regarding the Company's business, management and financial affairs and the terms
and conditions of the Offering,  the Note, the Warrant and the Securities and to
obtain  additional  information  (to  the  extent  the  Company  possessed  such


                                       14


information  or  could  acquire  it  without  unreasonable  effort  or  expense)
necessary to verify any  information  furnished to the Purchaser or to which the
Purchaser had access.

                  5.4  Purchaser   Bears   Economic   Risk.  The  Purchaser  has
substantial   experience  in  evaluating  and  investing  in  private  placement
transactions  of  securities  in companies  similar to the Company so that it is
capable of evaluating  the merits and risks of its investment in the Company and
has the  capacity  to protect its own  interests.  The  Purchaser  must bear the
economic risk of this investment  until the Securities are sold pursuant to: (i)
an  effective  registration  statement  under  the  Securities  Act;  or (ii) an
exemption from registration is available with respect to such sale.

                  5.5  Acquisition  for Own Account.  The Purchaser is acquiring
the  Note and  Warrant  and the  Note  Shares  and the  Warrant  Shares  for the
Purchaser's  own account for investment  only, and not as a nominee or agent and
not with a view towards or for resale in connection with their distribution.

                  5.6  Purchaser   Can  Protect  Its  Interest.   The  Purchaser
represents that by reason of its, or of its management's, business and financial
experience,  the  Purchaser has the capacity to evaluate the merits and risks of
its  investment in the Note,  the Warrant and the  Securities and to protect its
own  interests  in  connection  with  the  transactions   contemplated  in  this
Agreement,  and the Related  Agreements.  Further,  the Purchaser is aware of no
publication  of  any   advertisement   in  connection   with  the   transactions
contemplated in the Agreement or the Related Agreements.

                  5.7 Accredited  Investor.  Purchaser  represents that it is an
accredited investor within the meaning of Regulation D under the Securities Act.

                  5.8 Legends.

                  (a)   The Note shall bear substantially the following legend:

                  "THIS NOTE AND THE COMMON STOCK  ISSUABLE  UPON  CONVERSION OF
                  THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
                  1933, AS AMENDED,  OR ANY APPLICABLE,  STATE  SECURITIES LAWS.
                  THIS NOTE AND THE COMMON STOCK  ISSUABLE  UPON  CONVERSION  OF
                  THIS  NOTE MAY NOT BE  SOLD,  OFFERED  FOR  SALE,  PLEDGED  OR
                  HYPOTHECATED  IN  THE  ABSENCE  OF AN  EFFECTIVE  REGISTRATION
                  STATEMENT  AS TO THIS NOTE OR SUCH  SHARES  UNDER SAID ACT AND
                  APPLICABLE  STATE  SECURITIES  LAWS OR AN  OPINION  OF COUNSEL
                  REASONABLY  SATISFACTORY  TO MITEK  SYSTEMS,  INC.  THAT  SUCH
                  REGISTRATION IS NOT REQUIRED."

                  (b)  The Note Shares and the Warrant Shares,  if not issued by
DWAC  system (as  hereinafter  defined),  shall bear a legend  which shall be in
substantially the following:


                                       15


                  "THE  SHARES  REPRESENTED  BY THIS  CERTIFICATE  HAVE NOT BEEN
                  REGISTERED  UNDER THE SECURITIES  ACT OF 1933, AS AMENDED,  OR
                  ANY APPLICABLE, STATE SECURITIES LAWS. THESE SHARES MAY NOT BE
                  SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE
                  OF AN EFFECTIVE  REGISTRATION  STATEMENT UNDER SUCH SECURITIES
                  ACT  AND  APPLICABLE  STATE  LAWS  OR AN  OPINION  OF  COUNSEL
                  REASONABLY  SATISFACTORY  TO MITEK  SYSTEMS,  INC.  THAT  SUCH
                  REGISTRATION IS NOT REQUIRED."

                  (c) The Warrant shall bear substantially the following legend:

                  "THIS WARRANT AND THE COMMON SHARES  ISSUABLE UPON EXERCISE OF
                  THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
                  OF 1933, AS AMENDED,  OR ANY APPLICABLE STATE SECURITIES LAWS.
                  THIS WARRANT AND THE COMMON  SHARES  ISSUABLE UPON EXERCISE OF
                  THIS  WARRANT MAY NOT BE SOLD,  OFFERED  FOR SALE,  PLEDGED OR
                  HYPOTHECATED  IN  THE  ABSENCE  OF AN  EFFECTIVE  REGISTRATION
                  STATEMENT  AS TO THIS  WARRANT  OR THE  UNDERLYING  SHARES  OF
                  COMMON STOCK UNDER SAID ACT AND  APPLICABLE  STATE  SECURITIES
                  LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO MITEK
                  SYSTEMS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED."

         6. Covenants of the Company.  The Company covenants and agrees with the
Purchaser as follows:

                  6.1  Stop-Orders.  The  Company  will  advise  the  Purchaser,
promptly  after it receives  notice of issuance by the  Securities  and Exchange
Commission (the "SEC"), any state securities  commission or any other regulatory
authority  of any stop  order  or of any  order  preventing  or  suspending  any
offering  of  any  securities  of  the  Company,  or of  the  suspension  of the
qualification  of the Common  Stock of the Company  for  offering or sale in any
jurisdiction, or the initiation of any proceeding for any such purpose.

                  6.2 Trading.  The Company shall promptly secure the trading of
the shares of Common Stock  issuable  upon  conversion  of the Note and upon the
exercise of the Warrant on the OTCBB (the "Principal Market") as required by the
Registration  Rights  Agreement and shall  maintain such trading  eligibility so
long as any other  shares of Common  Stock shall be so traded . The Company will
maintain  the  trading of its Common  Stock on the  Principal  Market,  and will
comply in all material respects with the Company's  reporting,  filing and other
obligations under the bylaws or rules of the National  Association of Securities
Dealers ("NASD") and such exchanges, as applicable.


                                       16


                  6.3 Market Regulations. The Company shall notify the SEC, NASD
and applicable state authorities, in accordance with their requirements,  of the
transactions  contemplated by this Agreement, and shall take all other necessary
action and  proceedings as may be required and permitted by applicable law, rule
and  regulation,  for the legal  and valid  issuance  of the  Securities  to the
Purchaser and promptly provide copies thereof to the Purchaser.

                  6.4 Reporting Requirements.  The Company will timely file with
the SEC all  reports  required  to be filed  pursuant  to the  Exchange  Act and
refrain from terminating its status as an issuer required by the Exchange Act to
file reports  thereunder  even if the  Exchange Act or the rules or  regulations
thereunder would permit such termination.

                  6.5 Use of  Funds.  The  Company  agrees  that it will use the
proceeds  of the  sale of the Note  and  Warrant  for  general  working  capital
purposes only.

                  6.6  Access  to  Facilities.   The  Company  will  permit  any
representatives designated by the Purchaser (or any successor of the Purchaser),
upon  reasonable  notice and during  normal  business  hours,  at such  person's
expense and accompanied by a representative of the Company, to:

                  (a) visit and inspect any of the properties of the Company;

                  (b) examine the corporate and financial records of the Company
(unless such  examination is not permitted by federal,  state or local law or by
contract) and make copies thereof or extracts therefrom; and

                  (c)  discuss the affairs, finances and accounts of the Company
with the directors, officers and independent accountants of the Company.

Notwithstanding  the  foregoing,  the Company  will not  provide  any  material,
non-public   information  to  the  Purchaser   unless  the  Purchaser   signs  a
confidentiality  agreement and otherwise  complies with Regulation FD, under the
federal securities laws.

                  6.7 Taxes.  The Company will  promptly pay and  discharge,  or
cause to be paid  and  discharged,  when  due and  payable,  all  lawful  taxes,
assessments and governmental charges or levies imposed upon the income, profits,
property or  business  of the  Company;  provided,  however,  that any such tax,
assessment,  charge  or levy  need  not be paid if the  validity  thereof  shall
currently  be  contested  in good faith by  appropriate  proceedings  and if the
Company  shall  have set  aside on its  books  adequate  reserves  with  respect
thereto,  and  provided,  further,  that the  Company  will pay all such  taxes,
assessments, charges or levies forthwith upon the commencement of proceedings to
foreclose any lien which may have attached as security therefor.

                  6.8  Insurance.  The Company will keep its assets which are of
an insurable  character  insured by  financially  sound and  reputable  insurers
against loss or damage by fire,  explosion and other risks  customarily  insured
against by companies in similar business similarly situated as the Company;  and
the Company  will  maintain,  with  financially  sound and  reputable  insurers,
insurance  against other hazards and risks and liability to persons and property
to the  extent  and in the  manner  which the  Company  reasonably  believes  is
customary for companies in similar  business  similarly  situated as the Company


                                       17


and to the extent  available on commercially  reasonable  terms. The Company and
each of its  Subsidiaries  will jointly and severally bear the full risk of loss
from any loss of any nature whatsoever with respect to the assets pledged to the
Purchaser  as  security  for its  obligations  hereunder  and under the  Related
Agreements.  At the  Company's own cost and expense in amounts and with carriers
reasonably  acceptable  to Purchaser,  the Company and each of the  Subsidiaries
shall (i) keep all its insurable  properties  and  properties in which it has an
interest insured against the hazards of fire, flood,  sprinkler  leakage,  those
hazards covered by extended coverage  insurance and such other hazards,  and for
such  amounts,  as is customary in the case of companies  engaged in  businesses
similar to the  Company's  or the  respective  Subsidiary's  including  business
interruption insurance;  (ii) maintain a bond in such amounts as is customary in
the case of  companies  engaged in  businesses  similar to the  Company's or the
Subsidiary's   insuring   against   larceny,   embezzlement  or  other  criminal
misappropriation  of insured's  officers and  employees who may either singly or
jointly  with  others  at any time  have  access  to the  assets or funds of the
Company  either  directly or through  governmental  authority  to draw upon such
funds or to direct  generally the  disposition  of such assets;  (iii)  maintain
public and product liability insurance against claims for personal injury, death
or  property  damage  suffered  by  others;  (iv)  maintain  all  such  worker's
compensation or similar insurance as may be required under the laws of any state
or  jurisdiction  in which the Company or the Subsidiary is engaged in business;
and (v) furnish  Purchaser  with (x) copies of all  policies and evidence of the
maintenance  of such  policies at least  thirty (30) days before any  expiration
date, (y) excepting the Company's workers' compensation policy,  endorsements to
such policies  naming  Purchaser as  "co-insured"  or  "additional  insured" and
appropriate  loss payable  endorsements  in form and substance  satisfactory  to
Purchaser, naming Purchaser as loss payee, and (z) evidence that as to Purchaser
the  insurance  coverage  shall not be  impaired  or  invalidated  by any act or
neglect of the Company or any Subsidiary and the insurer will provide  Purchaser
with at least  thirty (30) days notice  prior to  cancellation.  The Company and
each Subsidiary  shall instruct the insurance  carriers that in the event of any
loss  thereunder,  the carriers  shall make payment for such loss to the Company
and/or the Subsidiary and Purchaser jointly. In the event that as of the date of
receipt of each loss  recovery  upon any such  insurance,  the Purchaser has not
declared  an event of  default  with  respect  to this  Agreement  or any of the
Related  Agreements,   then  the  Company  shall  be  permitted  to  direct  the
application of such loss recovery proceeds toward investment in property,  plant
and equipment that would comprise  "Collateral"  secured by Purchaser's security
interest  pursuant  to its  security  agreement,  with any  surplus  funds to be
applied  toward payment of the  obligations of the Company to Purchaser.  In the
event that  Purchaser has properly  declared an event of default with respect to
this  Agreement  or any of the  Related  Agreements,  then all  loss  recoveries
received by Purchaser upon any such  insurance  thereafter may be applied to the
obligations of the Company hereunder and under the Related  Agreements,  in such
order as the Purchaser may determine. Any surplus (following satisfaction of all
Company  obligations to Purchaser)  shall be paid by Purchaser to the Company or
applied as may be otherwise  required by law. Any  deficiency  thereon  shall be
paid by the Company or the Subsidiary, as applicable, to Purchaser, on demand.

                  6.9 Intellectual  Property. The Company shall maintain in full
force and effect its corporate existence, rights and franchises and all licenses
and other  rights to use  Intellectual  Property  owned or  possessed  by it and
reasonably deemed to be necessary to the conduct of its business.


                                       18


                  6.10 Properties.  The Company will keep its properties in good
repair, working order and condition, reasonable wear and tear excepted, and from
time to time  make all  needful  and  proper  repairs,  renewals,  replacements,
additions  and  improvements  thereto;  and the Company will at all times comply
with  each  provision  of all  leases  to which it is a party or under  which it
occupies  property if the breach of such provision could  reasonably be expected
to have a Material Adverse Effect.

                  6.11  Confidentiality.  The  Company  agrees  that it will not
disclose, including without limitation, in any public announcement,  the name of
the Purchaser,  unless  expressly agreed to by the Purchaser or unless and until
such disclosure (i) is required by law or applicable  regulation,  and then only
to the extent of such requirement or (ii) the Purchaser has previously agreed to
the language of the proposed  disclosure.  Purchaser  acknowledges that promptly
following  Closing,  the Company will issue a press  release,  the text of which
shall have been  approved  by  Purchaser,  and will file with the SEC a Form 8-K
Current Report with respect to this  Agreement,  the Related  Agreements and the
transactions  contemplated  hereunder and  thereunder,  and the Purchaser  shall
cooperate with the Company in connection with such required disclosure.

                  6.12 Required  Approvals.  For so long as twenty-five  percent
(25%) of the principal amount of the Note is outstanding,  the Company,  without
the prior written consent of the Purchaser, shall not:

                  (a) directly or indirectly declare or pay any dividends;

                  (b)  liquidate,  dissolve or effect a material  reorganization
(it being understood that in no event shall the Company  dissolve,  liquidate or
merge with any other  person or entity  (unless  the  Company  is the  surviving
entity);

                  (c) become subject to (including,  without limitation,  by way
of amendment to or  modification  of) any agreement or  instrument  which by its
terms would (under any  circumstances)  restrict the Company's  right to perform
the provisions of this Agreement or any of the agreements contemplated thereby;

                  (d)  materially  alter or change the scope of the  business of
the Company;

                  (e) create,  incur, assume or suffer to exist any indebtedness
(exclusive  of trade debt and debt incurred to finance the purchase of equipment
(not in excess of five  percent  (5%) per annum of the fair market  value of the
Company's  assets)  whether  secured or unsecured  other than (x) the  Company's
indebtedness to Laurus,  (y) indebtedness set forth on Schedule 6.12(e) attached
hereto and made a part hereof and any  refinancings or  replacements  thereof on
terms no less  favorable  to the  Purchaser  than the debt being  refinanced  or
replaced,  and (z) any indebtedness  incurred in connection with the purchase of
assets in the ordinary course of business,  and any refinancings or replacements
thereof on terms no less favorable to the Purchaser than the indebtedness  being
refinanced or replaced;  (ii) cancel any  indebtedness  owing to it in excess of
$50,000 in the aggregate  during any 12 month period;  (iii) assume,  guarantee,
endorse or otherwise  become directly or contingently  liable in connection with


                                       19


any  obligations  of any other  Person,  except the  endorsement  of  negotiable
instruments by the Company for deposit or collection or similar  transactions in
the ordinary course of business; and

                  (f) make  investments  in, make any loans or  advances  to, or
transfer  assets  to,  any  of  its  Subsidiaries,  other  than  any  immaterial
investments,  loans, advances and/or asset transfers made in the ordinary course
of business.

                  6.13  Reissuance of Securities.  The Company agrees to reissue
certificates  representing  the  Securities  without  the  legends  set forth in
Section 5.8 above at such time as:

                  (a)  the  holder  thereof  is  permitted  to  dispose  of such
Securities pursuant to Rule 144(k) under the Securities Act; or

                  (b) upon resale subject to an effective registration statement
after such Securities are registered under the Securities Act.

The Company  agrees to  cooperate  with the  Purchaser  in  connection  with all
resales  pursuant  to Rule 144(d) and Rule  144(k) and  provide  legal  opinions
necessary  to allow such resales  provided  the Company and its counsel  receive
reasonably  requested  representations from the selling Purchaser and broker, if
any.

                  6.14 Opinion. On the Closing Date, the Company will deliver to
the  Purchaser  an  opinion  reasonably  acceptable  to the  Purchaser  from the
Company's  legal  counsel in  substantially  the form in  Exhibit C hereto.  The
Company will provide, at the Company's expense, such other legal opinions in the
future as are  reasonably  necessary for the conversion of the Note and exercise
of the Warrant.

                  6.15  Margin  Stock.  The  Company  will not permit any of the
proceeds  of the  Note or the  Warrant  to be used  directly  or  indirectly  to
"purchase"  or  "carry"  "margin  stock" or to repay  indebtedness  incurred  to
"purchase" or "carry"  "margin stock" within the respective  meanings of each of
the quoted  terms under  Regulation  U of the Board of  Governors of the Federal
Reserve System as now and from time to time hereafter in effect.

                  6.16 Lockbox Arrangement for Company Accounts.  On or prior to
the Closing  Date,  (i) Company shall cause,  and provide  evidence to Purchaser
that it has caused,  any and all of its account  debtors  with respect to any of
its Accounts (as defined in the Uniform Commercial Code as in effect on the date
hereof  in the State of New York  (the  "UCC"))  to remit  their  payments  to a
lockbox account maintained at Commerce Bank (the "Lockbox Account") and (ii) the
Company  shall  enter into,  and cause  Commerce  Bank to enter into,  a control
agreement  with the  Purchaser,  which  control  agreement  (x)  shall  grant to
Purchaser a first  priority  security  interest  in the Lockbox  Account and any
other deposit account related thereto and be, to the  satisfaction of Purchaser,
sufficient to perfect such security  interest pursuant to the UCC, and (y) shall
be in form and substance  otherwise  satisfactory  to the Purchaser and Commerce
Bank.  The Purchaser  hereby  agrees to terminate its security  interests in the
Lockbox  Account upon the earlier to occur of the date upon which (A) the sum of
$1,000,000 aggregate  outstanding principal remains on the Note and (B) June 11,
2006.


                                       20


                  6.17 Stock Pledge. No later than sixty (60) days following the
date hereof,  the Company  shall take all actions  necessary  and  adviseable to
grant to Purchaser a perfected pledge and security  interest (or its equivalent)
in of all of the equity  interests of Mitek Systems,  Ltd. owned by the Company,
such pledge and security interest being granted to secure the obligations of the
Company set forth in this  Agreement  and the Related  Agreements,  in each case
pursuant to documentation  governed by the jurisdiction of organization of Mitek
Systems Ltd. (the "Stock Pledge Documentation"). The Company shall reimburse the
Purchaser for any and all reasonable  legal fees and other expenses  incurred by
the Purchaser in connection  with the  preparation,  execution,  negotiation and
delivery of the Stock Pledge Documentation.

         7. Covenants of the Purchaser.  The Purchaser covenants and agrees with
the Company as follows:

                  7.1  Confidentiality.  The  Purchaser  agrees that it will not
disclose,  and will not  include  in any  public  announcement,  the name of the
Company,  unless  expressly  agreed to by the  Company  or unless and until such
disclosure  is required by law or  applicable  regulation,  and then only to the
extent of such requirement.

                  7.2 Non-Public Information. The Purchaser agrees not to effect
any sales in the shares of the  Company's  Common Stock while in  possession  of
material,  non-public  information  regarding  the  Company if such sales  would
violate applicable securities law.

         8. Covenants of the Company and Purchaser Regarding Indemnification.

                  8.1 Company Indemnification.  The Company agrees to indemnify,
hold harmless,  reimburse and defend  Purchaser,  each of Purchaser's  officers,
directors,  agents,  affiliates,  control persons,  and principal  shareholders,
against  any  claim,  cost,  expense,  liability,  obligation,  loss  or  damage
(including reasonable legal fees) of any nature, incurred by or imposed upon the
Purchaser   which   results,   arises  out  of  or  is  based   upon:   (i)  any
misrepresentation  by  Company  or breach of any  warranty  by  Company  in this
Agreement, any Related Agreement or in any exhibits or schedules attached hereto
or  thereto;  or (ii) any  breach or default  in  performance  by Company of any
covenant or  undertaking  to be  performed  by Company  hereunder,  or any other
agreement entered into by the Company and Purchaser relating hereto.

                  8.2   Purchaser's   Indemnification.   Purchaser   agrees   to
indemnify,  hold  harmless,  reimburse  and defend the  Company  and each of the
Company's officers, directors, agents, affiliates, control persons and principal
shareholders,  at  all  times  against  any  claim,  cost,  expense,  liability,
obligation,  loss or damage  (including  reasonable  legal  fees) of any nature,
incurred by or imposed upon the Company which results, arises out of or is based
upon:  (i) any  misrepresentation  by  Purchaser  or breach of any  warranty  by
Purchaser in this Agreement or in any exhibits or schedules  attached  hereto or
any Related Agreement; or (ii) any breach or default in performance by Purchaser
of any covenant or  undertaking to be performed by Purchaser  hereunder,  or any
other agreement entered into by the Company and Purchaser relating hereto.

         9. Conversion of Convertible Note.

                  9.1 Mechanics of Conversion.


                                       21


                  (a)  Provided  the  Purchaser  has notified the Company of the
Purchaser's  intention  to sell the Note Shares and the Note Shares are included
in an effective registration statement or are otherwise exempt from registration
when sold:  (i) Upon the  conversion  of the Note or part  thereof,  the Company
shall,  at its own cost and expense,  take all necessary  action  (including the
issuance  of an  opinion  of  counsel  reasonably  acceptable  to the  Purchaser
following  a request by the  Purchaser)  to assure that the  Company's  transfer
agent  shall  issue  shares  of the  Company's  Common  Stock in the name of the
Purchaser (or its nominee in compliance with applicable  securities law) or such
other persons as designated by the Purchaser in accordance  with Section  9.1(b)
hereof and in such denominations to be specified representing the number of Note
Shares  issuable  upon such  conversion;  and (ii) The Company  warrants that no
instructions  other  than these  instructions  have been or will be given to the
transfer  agent of the Company's  Common Stock and that after the  Effectiveness
Date (as defined in the  Registration  Rights  Agreement) the Note Shares issued
will be  transferable  subject to the prospectus  delivery  requirements  of the
Securities Act and the provisions of this Agreement.

                  (b) Purchaser will give notice of its decision to exercise its
right to convert the Note or part thereof by telecopying or otherwise delivering
an executed and completed  notice of the number of shares to be converted to the
Company  (the "Notice of  Conversion").  The  Purchaser  will not be required to
surrender the Note until the  Purchaser  receives a credit to the account of the
Purchaser's   prime  broker   through  the  DWAC  system  (as  defined   below),
representing  the Note Shares or until the Note has been fully  satisfied.  Each
date on which a Notice of  Conversion  is telecopied or delivered to the Company
in accordance  with the provisions  hereof shall be deemed a "Conversion  Date."
Pursuant  to the terms of the  Notice of  Conversion,  the  Company  will  issue
instructions  to the transfer agent  accompanied by an opinion of counsel within
one (1) business day of the date of the delivery to the Company of the Notice of
Conversion  and shall  cause the  transfer  agent to transmit  the  certificates
representing the Conversion Shares to the Holder by crediting the account of the
Purchaser's  prime broker with the Depository  Trust Company ("DTC") through its
Deposit  Withdrawal Agent  Commission  ("DWAC") system within three (3) business
days after  receipt by the Company of the Notice of  Conversion  (the  "Delivery
Date").

                  (c) The Company  understands  that a delay in the  delivery of
the Note Shares in the form  required  pursuant  to Section 9 hereof  beyond the
Delivery Date could result in economic loss to the Purchaser.  In the event that
the Company fails to direct its transfer agent to deliver the Note Shares to the
Purchaser via the DWAC system within the time frame set forth in Section  9.1(b)
above and the Note Shares are not  delivered  to the  Purchaser  by the Delivery
Date, as  compensation to the Purchaser for such loss, the Company agrees to pay
late  payments to the Purchaser for late issuance of the Note Shares in the form
required  pursuant to Section 9 hereof upon conversion of the Note in the amount
equal to the greater of: (i) $500 per business day after the Delivery  Date;  or
(ii) the Purchaser's actual damages from such delayed delivery.  Notwithstanding
the  foregoing,  the Company will not owe the Purchaser any late payments if the
delay in the delivery of the Note Shares  beyond the Delivery Date is solely out
of the control of the  Company  and the  Company is actively  trying to cure the
cause of the delay.  The  Company  shall pay any  payments  incurred  under this
Section in  immediately  available  funds upon demand and, in the case of actual
damages,  accompanied by reasonable documentation of the amount of such damages.
Such documentation shall show the number of shares of Common Stock the Purchaser
is  forced to  purchase  (in an open  market  transaction)  which the  Purchaser


                                       22


anticipated  receiving  upon such  conversion,  and shall be  calculated  as the
amount by which (A) the Purchaser's  total purchase price  (including  customary
brokerage  commissions,  if any) for the  shares  of Common  Stock so  purchased
exceeds (B) the aggregate  principal  and/or  interest  amount of the Note,  for
which such Conversion Notice was not timely honored.

Nothing  contained herein or in any document  referred to herein or delivered in
connection  herewith  shall be deemed to  establish  or require the payment of a
rate of  interest  or other  charges  in  excess  of the  maximum  permitted  by
applicable law. In the event that the rate of interest or dividends  required to
be paid or other charges  hereunder  exceed the maximum amount permitted by such
law, any payments in excess of such maximum  shall be credited  against  amounts
owed by the Company to a Purchaser and thus refunded to the Company.

         10. Registration Rights.

                  10.1  Registration  Rights Granted.  The Company hereby grants
registration rights to the Purchaser pursuant to a Registration Rights Agreement
dated as of even date herewith between the Company and the Purchaser.

                  10.2 Offering Restrictions.  Except as previously disclosed in
the SEC  Reports  or in the  Exchange  Act  Filings,  or stock or stock  options
granted to employees or directors of the Company (these  exceptions  hereinafter
referred  to as the  "Excepted  Issuances"),  the  Company  will not  issue  any
securities with a continuously variable/floating conversion feature which are or
could be (by conversion or registration)  free-trading  securities (i.e.  common
stock  subject  to a  registration  statement)  prior to the full  repayment  or
conversion of the Note (together  with all accrued and unpaid  interest and fees
related thereto (the "Exclusion Period").

         11. Miscellaneous.

                  11.1 Governing Law. THIS AGREEMENT AND EACH RELATED  AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN  ACCORDANCE  WITH THE LAWS OF THE STATE OF
NEW YORK,  WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. ANY ACTION BROUGHT
BY EITHER PARTY AGAINST THE OTHER  CONCERNING THE  TRANSACTIONS  CONTEMPLATED BY
THIS  AGREEMENT  AND EACH RELATED  AGREEMENT  SHALL BE BROUGHT ONLY IN THE STATE
COURTS OF NEW YORK OR IN THE  FEDERAL  COURTS  LOCATED IN THE STATE OF NEW YORK.
BOTH  PARTIES  AND THE  INDIVIDUALS  EXECUTING  THIS  AGREEMENT  AND THE RELATED
AGREEMENTS ON BEHALF OF THE COMPANY AGREE TO SUBMIT TO THE  JURISDICTION OF SUCH
COURTS  AND  WAIVE  TRIAL BY JURY.  IN THE  EVENT  THAT  ANY  PROVISION  OF THIS
AGREEMENT OR ANY RELATED AGREEMENT  DELIVERED IN CONNECTION  HEREWITH IS INVALID
OR  UNENFORCEABLE  UNDER  ANY  APPLICABLE  STATUTE  OR RULE OF  LAW,  THEN  SUCH
PROVISION  SHALL  BE  DEEMED  INOPERATIVE  TO THE  EXTENT  THAT IT MAY  CONFLICT
THEREWITH  AND SHALL BE DEEMED  MODIFIED TO CONFORM WITH SUCH STATUTE OR RULE OF
LAW. ANY SUCH PROVISION WHICH MAY PROVE INVALID OR  UNENFORCEABLE  UNDER ANY LAW
SHALL NOT AFFECT THE VALIDITY OR  ENFORCEABILITY  OF ANY OTHER PROVISION OF THIS
AGREEMENT OR ANY RELATED AGREEMENT.


                                       23


                  11.2 Survival. The representations,  warranties, covenants and
agreements made herein shall survive any investigation made by the Purchaser and
the  closing of the  transactions  contemplated  hereby to the  extent  provided
therein.  All statements as to factual  matters  contained in any certificate or
other  instrument  delivered by or on behalf of the Company  pursuant  hereto in
connection  with the  transactions  contemplated  hereby  shall be  deemed to be
representations and warranties by the Company hereunder solely as of the date of
such certificate or instrument.

                  11.3  Successors.   Except  as  otherwise  expressly  provided
herein,  the  provisions  hereof  shall  inure to the benefit of, and be binding
upon, the successors,  heirs, executors and administrators of the parties hereto
and shall inure to the benefit of and be enforceable by each person who shall be
a holder of the Securities  from time to time,  other than the holders of Common
Stock which has been sold by the Purchaser  pursuant to Rule 144 or an effective
registration  statement.  Purchaser  may not assign its  rights  hereunder  to a
competitor of the Company.

11.4 Entire Agreement60.  . This Agreement, the Related Agreements, the exhibits
and  schedules  hereto and thereto and the other  documents  delivered  pursuant
hereto  constitute the full and entire  understanding  and agreement between the
parties with regard to the subjects hereof and no party shall be liable or bound
to any other in any manner by any  representations,  warranties,  covenants  and
agreements except as specifically set forth herein and therein.

11.5 Severability61.  . In case any provision of the Agreement shall be invalid,
illegal or  unenforceable,  the  validity,  legality and  enforceability  of the
remaining provisions shall not in any way be affected or impaired thereby.

                  11.6 Amendment and Waiver.

                  (a) This  Agreement  may be amended or modified  only upon the
written consent of the Company and the Purchaser.

                  (b)  The  obligations  of the  Company  and the  rights of the
Purchaser  under this  Agreement may be waived only with the written  consent of
the Purchaser.

                  (c)  The  obligations  of the  Purchaser and the rights of the
Company under this Agreement may be waived only with the written  consent of the
Company.

                  11.7  Delays  or  Omissions.  It is  agreed  that no  delay or
omission to exercise any right,  power or remedy accruing to any party, upon any
breach,  default or  noncompliance  by another party under this Agreement or the
Related  Agreements,  shall impair any such right, power or remedy, nor shall it
be construed to be a waiver of any such breach, default or noncompliance, or any
acquiescence  therein, or of or in any similar breach,  default or noncompliance
thereafter occurring. All remedies,  either under this Agreement, or the Related
Agreements,  by law or otherwise  afforded to any party, shall be cumulative and
not alternative.

                  11.8  Notices.  All notices  required or  permitted  hereunder
shall be in writing and shall be deemed effectively given:


                                       24


                  (a) upon personal delivery to the party to be notified;

                  (b)  when sent by confirmed  facsimile  if sent during  normal
business hours of the recipient, if not, then on the next business day;

                  (c)  three  (3)  business  days  after  having  been  sent  by
registered or certified mail, return receipt requested, postage prepaid; or

                  (d)  one (1) day after  deposit with a  nationally  recognized
overnight courier,  specifying next day delivery,  with written  verification of
receipt.

All communications shall be sent as follows:

       If to the Company, to:       Mitek Systems, Inc.
                                    14145 Danielson Street
                                    Suite B
                                    Poway, California 92064

                                    Attention: Chief Financial Officer
                                    Facsimile: 858-513-4622

                                    With a copy to:

                                    Luce Forward Hamilton & Scripps LLP
                                    600 West Broadway, Suite 2600
                                    San Diego, California    92101

                                    Attention: P. Blake Allen, Esq.
                                    Facsimile: 619-645-5357

       If to the Purchaser, to:     Laurus Master Fund, Ltd.
                                    c/o Ironshore Corporate Services ltd.
                                    P.O. Box 1234 G.T.
                                    Queensgate House, South Church Street
                                    Grand Cayman, Cayman Islands
                                    Facsimile: 345-949-9877

                                    With a copy to:

                                    John E. Tucker, Esq.
                                    825 Third Avenue 14th Floor
                                    New York, New York 10022
                                    Facsimile: 212-541-4434

or at such  other  address as the  Company or the  Purchaser  may  designate  by
written notice to the other parties hereto given in accordance herewith.


                                       25


                  11.9 Attorneys'  Fees. In the event that any suit or action is
instituted to enforce any provision in this Agreement,  the prevailing  party in
such dispute shall be entitled to recover from the losing party all fees,  costs
and  expenses  of  enforcing  any right of such  prevailing  party under or with
respect to this Agreement,  including,  without limitation, such reasonable fees
and  expenses  of  attorneys  and  accountants,  which  shall  include,  without
limitation, all fees, costs and expenses of appeals.

                  11.10  Titles and  Subtitles.  The titles of the  sections and
subsections  of the Agreement are for  convenience of reference only and are not
to be considered in construing this Agreement.

                  11.11 Facsimile Signatures;  Counterparts.  This Agreement may
be executed by facsimile  signatures and in any number of counterparts,  each of
which shall be an  original,  but all of which  together  shall  constitute  one
instrument.

                  11.12  Broker's  Fees.  Except as set forth on Schedule  11.12
hereof,  Each  party  hereto  represents  and  warrants  that no agent,  broker,
investment banker,  person or firm acting on behalf of or under the authority of
such party  hereto is or will be entitled to any broker's or finder's fee or any
other  commission  directly or indirectly in  connection  with the  transactions
contemplated  herein.  Each party hereto  further agrees to indemnify each other
party for any  claims,  losses or  expenses  incurred  by such other  party as a
result of the representation in this Section 11.12 being untrue.

                  11.13  Construction.  Each party  acknowledges  that its legal
counsel  participated  in the  preparation  of this  Agreement  and the  Related
Agreements  and,  therefore,  stipulates  that  the  rule of  construction  that
ambiguities  are to be resolved  against the drafting party shall not be applied
in the interpretation of this Agreement to favor any party against the other.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]



                                       26


         IN WITNESS  WHEREOF,  the parties  hereto have executed the  SECURITIES
PURCHASE AGREEMENT as of the date set forth in the first paragraph hereof.

COMPANY:                                   PURCHASER:

MITEK SYSTEMS, INC.                        LAURUS MASTER FUND, LTD.


By:                                        By:
   ----------------------------------         ----------------------------------
Name:                                      Name:
     --------------------------------           --------------------------------
Title:                                     Title:
      -------------------------------            -------------------------------




                                       27

           THIS  WARRANT  AND THE SHARES OF COMMON  STOCK  ISSUABLE  UPON
           EXERCISE OF THIS  WARRANT HAVE NOT BEEN  REGISTERED  UNDER THE
           SECURITIES  ACT OF 1933, AS AMENDED,  OR ANY STATE  SECURITIES
           LAWS. THIS WARRANT AND THE COMMON STOCK ISSUABLE UPON EXERCISE
           OF THIS WARRANT MAY NOT BE SOLD,  OFFERED FOR SALE, PLEDGED OR
           HYPOTHECATED  IN  THE  ABSENCE  OF AN  EFFECTIVE  REGISTRATION
           STATEMENT AS TO THIS WARRANT UNDER SAID ACT AND ANY APPLICABLE
           STATE  SECURITIES  LAWS OR AN OPINION  OF  COUNSEL  REASONABLY
           SATISFACTORY TO MITEK SYSTEMS,  INC. THAT SUCH REGISTRATION IS
           NOT REQUIRED.

            Right to Purchase up to 860,000 Shares of Common Stock of
                               Mitek Systems, Inc.
                              --------------------
                   (subject to adjustment as provided herein)

                          COMMON STOCK PURCHASE WARRANT

No.  _________________                                 Issue Date: June 11, 2004

         MITEK  SYSTEMS,  INC., a  corporation  organized  under the laws of the
State of Delaware hereby certifies that, for value received, LAURUS MASTER FUND,
LTD.,  or assigns (the  "Holder"),  is entitled,  subject to the terms set forth
below, to purchase from the Company (as defined herein) from and after the Issue
Date of this Warrant and at any time or from time to time before 5:00 p.m.,  New
York time, through the close of business June 11, 2011 (the "Expiration  Date"),
up  to  860,000  fully  paid  and  nonassessable  shares  of  Common  Stock  (as
hereinafter  defined),  $0.001 par value per share,  at the applicable  Exercise
Price per share (as defined  below).  The number and character of such shares of
Common  Stock  and the  applicable  Exercise  Price per  share  are  subject  to
adjustment as provided herein.

         As used  herein  the  following  terms,  unless the  context  otherwise
requires, have the following respective meanings:

                  (a) The term "Company"  shall include Mitek Systems,  Inc. and
         any  corporation  which shall succeed,  or assume the  obligations  of,
         Mitek Systems, Inc. hereunder.

                  (b) The term "Common Stock" includes (i) the Company's  common
         stock,  par value $0.001 per share;  and (ii) any other securities into
         which  or for  which  any of the  securities  described  in (a)  may be
         converted  or  exchanged  pursuant  to  a  plan  of   recapitalization,
         reorganization, merger, sale of assets or otherwise.

                  (c) The term  "Other  Securities"  refers to any stock  (other
         than  Common  Stock) and other  securities  of the Company or any other
         person  (corporate or otherwise) which the holder of the Warrant at any
         time shall be  entitled  to  receive,  or shall have  received,  on the
         exercise of the Warrant,  in lieu of or in addition to Common Stock, or
         which at any time  shall be  issuable  or shall  have  been  issued  in


                                       1


         exchange  for or in  replacement  of Common  Stock or Other  Securities
         pursuant to Section 4 or otherwise.

                  (d) The "Exercise  Price"  applicable under this Warrant shall
         be as follows:

                           (i) a price of $0.79  for the  first  230,000  shares
                  acquired hereunder;

                           (ii) a price of $0.85  for the  next  230,000  shares
                  acquired hereunder; and

                           (iii) a price  of  $0.92  for any  additional  shares
                  acquired hereunder.

         Exercise of Warrant.

                  Number of Shares  Issuable upon  Exercise.  From and after the
date hereof  through and  including  the  Expiration  Date,  the Holder shall be
entitled  to receive,  upon  exercise  of this  Warrant in whole or in part,  by
delivery of an original or fax copy of an exercise  notice in the form  attached
hereto  as  Exhibit A (the  "Exercise  Notice"),  shares of Common  Stock of the
Company, subject to adjustment pursuant to Section 4.

                  Fair Market  Value.  For  purposes  hereof,  the "Fair  Market
Value" of a share of Common  Stock as of a particular  date (the  "Determination
Date") shall mean:

                  IF THE COMPANY'S  COMMON STOCK IS TRADED ON THE AMERICAN STOCK
         EXCHANGE OR ANOTHER  NATIONAL  EXCHANGE OR IS QUOTED ON THE NATIONAL OR
         SMALLCAP  MARKET OF THE NASDAQ STOCK MARKET,  INC.("NASDAQ"),  THEN THE
         CLOSING  OR LAST  SALE  PRICE,  RESPECTIVELY,  REPORTED  FOR  THE  LAST
         BUSINESS DAY IMMEDIATELY PRECEDING THE DETERMINATION DATE.

                  IF THE  COMPANY'S  COMMON  STOCK IS NOT TRADED ON THE AMERICAN
         STOCK  EXCHANGE  OR ANOTHER  NATIONAL  EXCHANGE OR ON THE NASDAQ BUT IS
         TRADED ON THE NASD OTC BULLETIN BOARD,  THEN THE MEAN OF THE AVERAGE OF
         THE CLOSING BID AND ASKED  PRICES  REPORTED  FOR THE LAST  BUSINESS DAY
         IMMEDIATELY PRECEDING THE DETERMINATION DATE.

                  EXCEPT AS  PROVIDED  IN CLAUSE  (D)  BELOW,  IF THE  COMPANY'S
         COMMON STOCK IS NOT PUBLICLY TRADED, THEN AS THE HOLDER AND THE COMPANY
         AGREE OR IN THE ABSENCE OF AGREEMENT BY ARBITRATION IN ACCORDANCE  WITH
         THE  RULES  THEN IN  EFFECT OF THE  AMERICAN  ARBITRATION  ASSOCIATION,
         BEFORE  A  SINGLE  ARBITRATOR  TO BE  CHOSEN  FROM A PANEL  OF  PERSONS
         QUALIFIED  BY  EDUCATION  AND  TRAINING  TO  PASS ON THE  MATTER  TO BE
         DECIDED.

                  IF THE  DETERMINATION  DATE  IS  THE  DATE  OF A  LIQUIDATION,
         DISSOLUTION  OR WINDING  UP, OR ANY EVENT  DEEMED TO BE A  LIQUIDATION,
         DISSOLUTION OR WINDING UP PURSUANT TO THE COMPANY'S  CHARTER,  THEN ALL
         AMOUNTS TO BE PAYABLE PER SHARE TO HOLDERS OF THE COMMON STOCK PURSUANT
         TO THE CHARTER IN THE EVENT OF SUCH LIQUIDATION, DISSOLUTION OR WINDING
         UP,  PLUS ALL OTHER  AMOUNTS TO BE PAYABLE  PER SHARE IN RESPECT OF THE
         COMMON  STOCK  IN  LIQUIDATION  UNDER  THE  CHARTER,  ASSUMING  FOR THE
         PURPOSES OF THIS CLAUSE (D) THAT ALL OF THE SHARES OF COMMON STOCK THEN
         ISSUABLE  UPON  EXERCISE  OF  THE  WARRANT  ARE   OUTSTANDING   AT  THE
         DETERMINATION DATE.

                  Company  Acknowledgment.  The Company will, at the time of the
exercise of the Warrant,  upon the request of the holder hereof  acknowledge  in
writing its  continuing  obligation to afford to such holder any rights to which
such holder shall continue to be entitled after such exercise in accordance with
the  provisions  of this  Warrant.  If the  holder  shall  fail to make any such
request,  such failure shall not affect the continuing obligation of the Company
to afford to such holder any such rights.

                  Trustee for Warrant Holders. In the event that a bank or trust
company  shall have been  appointed  as trustee  for the  holders of the Warrant
pursuant to Subsection 3.2, such bank or trust company shall have all the powers
and duties of a warrant agent (as  hereinafter  described) and shall accept,  in


                                       2


its own name for the account of the Company or such  successor  person as may be
entitled  thereto,  all  amounts  otherwise  payable  to  the  Company  or  such
successor,  as the case may be, on  exercise  of this  Warrant  pursuant to this
Section 1.

         Procedure for Exercise.

                  Delivery of Stock Certificates, Etc., on Exercise. The Company
agrees that the shares of Common Stock  purchased  upon exercise of this Warrant
shall be deemed to be issued to the Holder as the record owner of such shares as
of the close of  business  on the date on which  this  Warrant  shall  have been
surrendered and payment made for such shares in accordance herewith.  As soon as
practicable  after the exercise of this  Warrant in full or in part,  and in any
event  within  three (3) business  days  thereafter,  the Company at its expense
(including  the payment by it of any  applicable  issue  taxes) will cause to be
issued in the name of and  delivered  to the  Holder,  or as such  Holder  (upon
payment  by  such  Holder  of any  applicable  transfer  taxes)  may  direct  in
compliance with applicable  securities  laws, a certificate or certificates  for
the number of duly and validly issued,  fully paid and  nonassessable  shares of
Common  Stock (or Other  Securities)  to which such Holder  shall be entitled on
such exercise,  plus, in lieu of any fractional share to which such holder would
otherwise be entitled,  cash equal to such fraction  multiplied by the then Fair
Market  Value  of one  full  share,  together  with  any  other  stock  or other
securities and property  (including cash, where applicable) to which such Holder
is entitled upon such exercise pursuant to Section 1 or otherwise.

                  Exercise.  Payment  may  be  made  either  (i) in  cash  or by
certified or official  bank check  payable to the order of the Company  equal to
the applicable  aggregate  Exercise Price,  (ii) by delivery of the Warrant,  or
shares of Common  Stock  and/or  Common Stock  receivable  upon  exercise of the
Warrant in accordance  with Section (b) below,  or (iii) by a combination of any
of the  foregoing  methods,  for the number of Common  Shares  specified in such
Exercise  Notice (as such  exercise  number  shall be  adjusted  to reflect  any
adjustment in the total number of shares of Common Stock  issuable to the Holder
per the terms of this  Warrant)  and the Holder  shall  thereupon be entitled to
receive  the  number  of  duly  authorized,   validly  issued,   fully-paid  and
non-assessable  shares of  Common  Stock (or  Other  Securities)  determined  as
provided herein.  Notwithstanding any provisions herein to the contrary,  if the
Fair  Market  Value of one share of Common  Stock is greater  than the  Exercise
Price (at the date of  calculation  as set forth  below),  in lieu of exercising
this Warrant for cash, the Holder may elect to receive shares equal to the value
(as determined  below) of this Warrant (or the portion thereof being  exercised)
by  surrender of this Warrant at the  principal  office of the Company  together
with the  properly  endorsed  Exercise  Notice in which event the Company  shall
issue to the  Holder a number  of  shares of  Common  Stock  computed  using the
following formula:

                   X = Y (A-B)
                       --------
                          A

        Where X = the  number  of  shares  of  Common  Stock to be issued to the
                  Holder

              Y = the  number of shares of Common  Stock  purchasable  under the
                  Warrant  or,  if  only a  portion  of  the  Warrant  is  being
                  exercised,  the portion of the Warrant being exercised (at the
                  date of such calculation)

              A = the Fair  Market  Value of one share of the  Company's  Common
                  Stock (at the date of such calculation)

              B = Exercise Price (as adjusted to the date of such calculation)

        Effect of Reorganization, Etc.; Adjustment of Exercise Price.

                  Reorganization,  Consolidation,  Merger,  Etc.  In case at any
time or from time to time,  the Company shall (a) effect a  reorganization,  (b)
consolidate  with or  merge  into  any  other  person,  or (c)  transfer  all or
substantially all of its properties or assets to any other person under any plan
or arrangement  contemplating the dissolution of the Company, then, in each such
case,  as a condition  to the  consummation  of such a  transaction,  proper and


                                       3


adequate  provision  shall be made by the  Company  whereby  the  Holder of this
Warrant,  on the exercise  hereof as provided in Section 1 at any time after the
consummation of such  reorganization,  consolidation  or merger or the effective
date of such  dissolution,  as the case may be,  shall  receive,  in lieu of the
Common  Stock (or Other  Securities)  issuable  on such  exercise  prior to such
consummation or such effective date, the stock and other securities and property
(including  cash) to which  such  Holder  would  have  been  entitled  upon such
consummation or in connection with such dissolution, as the case may be, if such
Holder had so exercised this Warrant,  immediately prior thereto, all subject to
further adjustment thereafter as provided in Section 4.

                  Dissolution.  In the event of any  dissolution  of the Company
following the transfer of all or substantially  all of its properties or assets,
the Company,  concurrently with any distributions  made to holders of its Common
Stock,  shall at its expense  deliver or cause to be delivered to the Holder the
stock and other  securities  and property  (including  cash,  where  applicable)
receivable  by the Holder of the  Warrant  pursuant to Section  3.1,  or, if the
Holder shall so instruct the Company,  to a bank or trust  company  specified by
the Holder and having its  principal  office in New York,  NY as trustee for the
Holder of the Warrant (the "Trustee").

                  Continuation of Terms. Upon any reorganization, consolidation,
merger or transfer (and any dissolution  following any transfer)  referred to in
this  Section 3, this  Warrant  shall  continue in full force and effect and the
terms hereof shall be applicable to the shares of stock and other securities and
property  receivable on the exercise of this Warrant after the  consummation  of
such   reorganization,   consolidation  or  merger  or  the  effective  date  of
dissolution  following  any such  transfer,  as the case  may be,  and  shall be
binding upon the issuer of any such stock or other securities, including, in the
case of any such transfer,  the person acquiring all or substantially all of the
properties  or assets of the  Company,  whether  or not such  person  shall have
expressly  assumed  the terms of this  Warrant as  provided in Section 4. In the
event  this  Warrant  does not  continue  in full  force  and  effect  after the
consummation of the transactions described in this Section 3, then the Company's
securities and property  (including  cash, where  applicable)  receivable by the
Holders  of  the  Warrant  will  be  delivered  to  Holder  or  the  Trustee  as
contemplated by Section 3.2.

         Extraordinary  Events  Regarding  Common  Stock.  In the event that the
Company shall (a) issue  additional  shares of the Common Stock as a dividend or
other  distribution on outstanding  Common Stock,  (b) subdivide its outstanding
shares of Common  Stock,  or (c)  combine its  outstanding  shares of the Common
Stock into a smaller  number of shares of the Common  Stock,  then, in each such
event,  the Exercise  Price  shall,  simultaneously  with the  happening of such
event,  be adjusted by multiplying  the then Exercise  Price by a fraction,  the
numerator  of which  shall be the number of shares of Common  Stock  outstanding
immediately prior to such event and the denominator of which shall be the number
of shares of Common  Stock  outstanding  immediately  after such event,  and the
product so obtained shall  thereafter be the Exercise Price then in effect.  The
Exercise Price, as so adjusted,  shall be readjusted in the same manner upon the
happening of any successive  event or events described herein in this Section 4.
The  number of shares of Common  Stock  that the  holder of this  Warrant  shall
thereafter,  on the  exercise  hereof as  provided  in Section 1, be entitled to
receive shall be increased to a number  determined by multiplying  the number of
shares of Common  Stock that would  otherwise  (but for the  provisions  of this
Section 4) be issuable on such exercise by a fraction of which (a) the numerator
is the  Exercise  Price that would  otherwise  (but for the  provisions  of this
Section 4) be in effect, and (b) the denominator is the Exercise Price in effect
on the date of such exercise.

         Certificate  as to  Adjustments.  In  each  case of any  adjustment  or
readjustment in the shares of Common Stock (or Other Securities) issuable on the
exercise of the  Warrant,  the Company at its expense  will  promptly  cause its
Chief Financial Officer or other appropriate designee to compute such adjustment
or  readjustment  in  accordance  with the terms of the  Warrant  and  prepare a
certificate  setting forth such adjustment or readjustment and showing in detail
the facts upon which such  adjustment  or  readjustment  is based,  including  a
statement of (a) the consideration received or receivable by the Company for any


                                       4


additional shares of Common Stock (or Other Securities) issued or sold or deemed
to have been issued or sold,  (b) the number of shares of Common Stock (or Other
Securities) outstanding or deemed to be outstanding,  and (c) the Exercise Price
and the number of shares of Common  Stock to be received  upon  exercise of this
Warrant,  in effect  immediately prior to such adjustment or readjustment and as
adjusted or readjusted as provided in this Warrant.  The Company will  forthwith
mail a copy of each  such  certificate  to the  holder  of the  Warrant  and any
Warrant agent of the Company (appointed pursuant to Section 11 hereof).

         Reservation  of Stock,  Etc.,  Issuable on  Exercise  of  Warrant.  The
Company will at all times  reserve and keep  available,  solely for issuance and
delivery  on the  exercise  of the  Warrant,  shares of  Common  Stock (or Other
Securities) from time to time issuable on the exercise of the Warrant.

         Assignment;  Exchange of Warrant. Subject to compliance with applicable
securities  laws,  this  Warrant,  and  the  rights  evidenced  hereby,  may  be
transferred  by any  registered  holder hereof (a  "Transferor")  in whole or in
part.  On the  surrender  for exchange of this  Warrant,  with the  Transferor's
endorsement  in  the  form  of  Exhibit  B  attached  hereto  (the   "Transferor
Endorsement  Form") and together with evidence  reasonably  satisfactory  to the
Company  demonstrating  compliance with applicable  securities laws, which shall
include,  without  limitation,  the  provision  of  a  legal  opinion  from  the
Transferor's  counsel (at the  Company's  expense)  that such transfer is exempt
from the  registration  requirements  of applicable  securities  laws,  and with
payment by the  Transferor  of any  applicable  transfer  taxes)  will issue and
deliver  to or on the  order of the  Transferor  thereof a new  Warrant  of like
tenor, in the name of the Transferor and/or the transferee(s)  specified in such
Transferor  Endorsement Form (each a "Transferee"),  calling in the aggregate on
the face or faces thereof for the number of shares of Common Stock called for on
the face or faces of the Warrant so surrendered by the Transferor.

         Replacement of Warrant. On receipt of evidence reasonably  satisfactory
to the Company of the loss,  theft,  destruction  or  mutilation of this Warrant
and, in the case of any such loss,  theft or  destruction  of this  Warrant,  on
delivery of an indemnity agreement or security  reasonably  satisfactory in form
and amount to the Company or, in the case of any such  mutilation,  on surrender
and  cancellation  of this Warrant,  the Company at its expense will execute and
deliver, in lieu thereof, a new Warrant of like tenor.

         Registration  Rights.  The  Holder  of this  Warrant  has been  granted
certain  registration  rights by the Company.  These registration rights are set
forth  in a  Registration  Rights  Agreement  entered  into by the  Company  and
Purchaser dated as of even date of this Warrant.

         Maximum  Exercise.  The Holder  shall not be entitled to exercise  this
Warrant on an exercise date, in connection  with that number of shares of Common
Stock  which would be in excess of the sum of (i) the number of shares of Common
Stock  beneficially  owned by the Holder and its affiliates on an exercise date,
and (ii) the number of shares of Common Stock issuable upon the exercise of this
Warrant with respect to which the determination of this proviso is being made on
an exercise date,  which would result in beneficial  ownership by the Holder and
its affiliates of more than 4.99% of the  outstanding  shares of Common Stock of
the Company on such date.  For the  purposes  of the proviso to the  immediately
preceding sentence,  beneficial ownership shall be determined in accordance with


                                       5


Section 13(d) of the Securities Exchange Act of 1934, as amended, and Regulation
13d-3 thereunder.  Notwithstanding the foregoing,  the restriction  described in
this  paragraph  may be revoked upon 75 days prior notice from the Holder to the
Company and is  automatically  null and void upon an Event of Default  under the
Note.

         Warrant Agent. The Company may, by written notice to the each Holder of
the Warrant,  appoint an agent for the purpose of issuing Common Stock (or Other
Securities)  on the exercise of this Warrant  pursuant to Section 1,  exchanging
this  Warrant  pursuant to Section 7, and  replacing  this  Warrant  pursuant to
Section 8, or any of the foregoing,  and thereafter any such issuance,  exchange
or replacement, as the case may be, shall be made at such office by such agent.

         Transfer on the Company's  Books.  Until this Warrant is transferred on
the books of the Company,  the Company may treat the registered holder hereof as
the absolute  owner hereof for all purposes,  notwithstanding  any notice to the
contrary.

         Notices,  Etc. All notices and other communications from the Company to
the  Holder  of this  Warrant  shall be  mailed  by first  class  registered  or
certified mail,  postage prepaid,  at such address as may have been furnished to
the Company in writing by such Holder or, until any such Holder furnishes to the
Company an  address,  then to, and at the  address  of, the last  Holder of this
Warrant who has so furnished an address to the Company.

         Voluntary Adjustment by the Company. The Company may at any time during
the term of this Warrant  reduce the then current  Exercise  Price to any amount
and for any period of time deemed  appropriate  by the Board of Directors of the
Company.

         Miscellaneous. This Warrant and any term hereof may be changed, waived,
discharged  or terminated  only by an instrument in writing  signed by the party
against which  enforcement of such change,  waiver,  discharge or termination is
sought.  This Warrant shall be governed by and construed in accordance  with the
laws of State of New York without regard to principles of conflicts of laws. Any
action brought concerning the transactions contemplated by this Warrant shall be
brought only in the state courts of New York or in the federal courts located in
the state of New York;  provided,  however,  that the Holder may choose to waive
this  provision  and  bring  an  action  outside  the  state  of New  York.  The
individuals  executing  this Warrant on behalf of the Company agree to submit to
the  jurisdiction  of such courts and waive trial by jury. The prevailing  party
shall be entitled to recover from the other party its reasonable attorney's fees
and  costs.  In the event  that any  provision  of this  Warrant  is  invalid or
unenforceable  under any applicable  statute or rule of law, then such provision
shall be deemed  inoperative  to the extent that it may conflict  therewith  and
shall be deemed  modified to conform  with such statute or rule of law. Any such
provision  which  may prove  invalid  or  unenforceable  under any law shall not
affect the validity or  enforceability  of any other  provision of this Warrant.
The headings in this Warrant are for purposes of reference  only,  and shall not
limit  or  otherwise  affect  any  of  the  terms  hereof.   The  invalidity  or
unenforceability  of any provision hereof shall in no way affect the validity or
enforceability  of any other provision  hereof.  The Company  acknowledges  that
legal counsel  participated in the  preparation of this Warrant and,  therefore,
stipulates  that the rule of  construction  that  ambiguities are to be resolved
against the drafting  party shall not be applied in the  interpretation  of this
Warrant to favor any party against the other party.


                                       6


                   [BALANCE OF PAGE INTENTIONALLY LEFT BLANK;
                            SIGNATURE PAGE FOLLOWS.]



                                       7





         IN WITNESS  WHEREOF,  the Company has  executed  this Warrant as of the
date first written above.

                                           MITEK SYSTEMS, INC.

WITNESS:
                                           By:
                                              ----------------------------------
                                           Name:
                                                --------------------------------
                                           Title:
                                                 -------------------------------



                                       8


                                    EXHIBIT A

                              FORM OF SUBSCRIPTION
                   (To Be Signed Only On Exercise Of Warrant)

TO:      Mitek Systems, Inc.

         Attention:  Chief Financial Officer

         The  undersigned,  pursuant to the provisions set forth in the attached
Warrant (No.____), hereby irrevocably elects to purchase (check applicable box):

________ ________ shares of the Common Stock covered by such Warrant; or

________ the maximum  number of shares of Common  Stock  covered by such Warrant
         pursuant to the cashless exercise procedure set forth in Section 2.

         The  undersigned  herewith makes payment of the full Exercise Price for
such  shares  at the  price per share  provided  for in such  Warrant,  which is
$___________. Such payment takes the form of (check applicable box or boxes):

________ $________ in lawful money of the United States; and/or

________ the  cancellation  of  such  portion  of  the  attached  Warrant  as is
         exercisable for a total of _______ shares of Common Stock (using a Fair
         Market Value of $_______  per share for purposes of this  calculation);
         and/or

________ the  cancellation  of such  number  of  shares  of  Common  Stock as is
         necessary,  in accordance with the formula set forth in Section 2.2, to
         exercise  this Warrant with respect to the maximum  number of shares of
         Common Stock purchasable  pursuant to the cashless  exercise  procedure
         set forth in Section 2.

         The  undersigned  requests  that the  certificates  for such  shares be
issued in the name of, and  delivered  to  ______________________________  whose
address is ___________________________________________________________________ .

         The  undersigned  represents  and warrants that all offers and sales by
the  undersigned of the securities  issuable upon exercise of the within Warrant
shall be made pursuant to  registration of the Common Stock under the Securities
Act of 1933, as amended (the "Securities  Act") or pursuant to an exemption from
registration under the Securities Act.

Dated:
       ------------------------        -----------------------------------------
                                       (Signature must conform to name of holder
                                       as specified on the face of the Warrant)

                                        Address:
                                                 -------------------------------

                                                 -------------------------------


                                      A-1


                                    EXHIBIT B

                         FORM OF TRANSFEROR ENDORSEMENT
                   (To Be Signed Only On Transfer Of Warrant)

         For  value  received,   the  undersigned  hereby  sells,  assigns,  and
transfers  unto the person(s)  named below under the heading  "Transferees"  the
right represented by the within Warrant to purchase the percentage and number of
shares of Common  Stock of Mitek  Systems,  Inc.  into which the within  Warrant
relates  specified  under the  headings  "Percentage  Transferred"  and  "Number
Transferred," respectively,  opposite the name(s) of such person(s) and appoints
each such person Attorney to transfer its respective right on the books of Mitek
Systems, Inc. with full power of substitution in the premises.

                                                 Percentage            Number
Transferees            Address                   Transferred         Transferred
- -----------            -------                   -----------         -----------

- ---------------------  ------------------------  ------------------  -----------

- ---------------------  ------------------------  ------------------  -----------

- ---------------------  ------------------------  ------------------  -----------

- ---------------------  ------------------------  ------------------  -----------


Dated:
       ------------------------        -----------------------------------------
                                       (Signature must conform to name of holder
                                       as specified on the face of the Warrant)

                                       Address:
                                                --------------------------------

                                                --------------------------------

                                       SIGNED IN THE PRESENCE OF:

                                       -----------------------------------------
                                                          (Name)
ACCEPTED AND AGREED:
[TRANSFEREE]

- ------------------------------------
             (Name)

                               MITEK SYSTEMS, INC.
                               SECURITY AGREEMENT

To:   Laurus Master Fund, Ltd.
      c/o Ironshore Corporate Services, Ltd.
      P.O. Box 1234 G.T
      Queensgate House
      South Church Street
      Grand Cayman, Cayman Islands

Date: June  11, 2004

To Whom It May Concern:

         To secure the payment of all Obligations (as hereafter defined),  Mitek
Systems,  Inc., a Delaware  corporation  (the  "Assignor"),  hereby  assigns and
grants to Laurus  Master  Fund,  Ltd.,  Cayman  Islands  company,  a  continuing
security  interest  in all of the  following  property  now owned or at any time
hereafter  acquired by the Assignor,  or in which the Assignor now has or at any
time in the future may acquire any right, title or interest (the  "Collateral"):
all cash, cash  equivalents,  accounts,  deposit  accounts  (including,  without
limitation,  the Restricted  Account (the  "Restricted  Account")  maintained at
Commerce Bank (Account Name: Mitek Systems,  Inc.,  Account Number:  7915474816)
referred  to  in  the  Restricted  Account  Agreement),   accounts   receivable,
inventory,   equipment,  goods,  documents,   instruments  (including,   without
limitation,  promissory notes), contract rights, general intangibles (including,
without  limitation,  payment  intangibles  and an absolute  right to license on
terms no less  favorable than those  currently in effect among our  affiliates),
chattel paper, supporting obligations,  investment property (including,  without
limitation,  all  equity  interests  owned  by the  Assignor),  letter-of-credit
rights,  trademarks,  trademark  applications,   tradestyles,   patents,  patent
applications,  copyrights and copyright  applications  in which the Assignor now
has or  hereafter  may acquire any right,  title or  interest,  all proceeds and
products thereof (including, without limitation,  proceeds of insurance) and all
additions,  accessions and substitutions thereto or therefore.  In the event the
Assignor wishes to finance the acquisition of any hereafter  acquired  equipment
and have obtained a commitment from a financing source to finance such equipment
from an unrelated third party, Laurus agrees to release its security interest on
such  hereafter  acquired  equipment  so financed by such third party  financing
source.  Except as otherwise  defined herein,  all capitalized terms used herein
shall have the meaning  provided such terms the  Securities  Purchase  Agreement
referred to below.

         The term "Obligations" as used herein shall mean and include all debts,
liabilities and obligations  owing by the Assignor to Laurus arising under,  out
of, or in connection with: (i) that certain Securities  Purchase Agreement dated
as of the date hereof by and  between  the  Company and Laurus (the  "Securities
Purchase  Agreement")  and  (ii)  the  Related  Agreements  referred  to in  the



Securities Purchase Agreement the Securities Purchase Agreement and each Related
Agreement as each may be amended,  modified,  restated or supplemented from time
to time,  are  collectively  referred  to  herein  as the  "Documents"),  or any
documents,  instruments or agreements relating to or executed in connection with
the Documents or any documents, instruments or agreements referred to therein or
otherwise, or any other indebtedness, obligations or liabilities of the Assignor
to Laurus,  whether  now  existing or  hereafter  arising,  direct or  indirect,
liquidated or unliquidated,  absolute or contingent,  due or not due and whether
under,  pursuant to or evidenced by a note, agreement,  guaranty,  instrument or
otherwise, in each case, irrespective of the genuineness,  validity,  regularity
or enforceability of such  Obligations,  or of any instrument  evidencing any of
the  Obligations or of any collateral  therefor or of the existence or extent of
such collateral, and irrespective of the allowability, allowance or disallowance
of any or all of the  Obligations  in  any  case  commenced  by or  against  the
Assignor  under Title 11, United  States Code,  including,  without  limitation,
obligations or indebtedness of the Assignor for  post-petition  interest,  fees,
costs and charges that would have accrued or been added to the  Obligations  but
for the commencement of such case.

         The Assignor hereby represents, warrants and covenants to Laurus that:

                  it is a corporation, partnership or limited liability company,
         as the case may be,  validly  existing,  in good standing and organized
         under the laws of the State of  Delaware , and it will  provide  Laurus
         thirty  (30)  days'  prior   written   notice  of  any  change  in  its
         jurisdiction of organization;

                  its  legal  name,   as  set  forth  in  its   Certificate   of
         Incorporation  (or  equivalent   organizational  document)  as  amended
         through the date  hereof,  is Mitek  Systems,  Inc. and it will provide
         Laurus  thirty  (30) days'  prior  written  notice of any change in its
         legal name;

                  its Internal  Revenue Service Employer  Identification  Number
         (if  applicable) is 87-0418827 , and it will provide Laurus thirty (30)
         days'  prior  written  notice  of  any  change  in  its  organizational
         identification number;

                  it is the lawful owner of the  Collateral  and it has the sole
         right  to  grant a  security  interest  therein  and  will  defend  the
         Collateral against all claims and demands of all persons and entities;

                  it will keep the Collateral  owned by it free and clear of all
         attachments,  levies, taxes, liens, security interests and encumbrances
         of every kind and  nature  ("Encumbrances"),  except  (i)  Encumbrances
         securing the Obligations and (ii) to the extent said  Encumbrance  does
         not secure  indebtedness  in excess of $50,000 and such  Encumbrance is
         removed or  otherwise  released  within  ten (10) days of the  creation
         thereof;

                  it will at its own cost and  expense  keep the  Collateral  in
         good state of repair  (ordinary  wear and tear  excepted)  and will not
         waste or  destroy  the same or any part  thereof  other  than  ordinary
         course discarding of items no longer used or useful in its business;

                  it will not  without  Laurus'  prior  written  consent,  sell,
         exchange,  lease or  otherwise  dispose of the  Collateral,  whether by
         sale,  lease or  otherwise,  except  for the sale of  inventory  in the
         ordinary  course of business and for the disposition or transfer in the
         ordinary  course of business  during any fiscal  year of  obsolete  and
         worn-out  equipment or equipment  no longer  necessary  for its ongoing
         needs,  having an aggregate  fair market value of not more than $25,000
         and only to the extent that:

                           THE  PROCEEDS  OF ANY  SUCH  DISPOSITION  ARE USED TO
                  ACQUIRE  REPLACEMENT  COLLATERAL  WHICH IS  SUBJECT TO LAURUS'
                  FIRST  PRIORITY  PERFECTED  SECURITY  INTEREST  OR ARE USED TO
                  REPAY OBLIGATIONS OR TO PAY GENERAL CORPORATE EXPENSES; AND



                           FOLLOWING THE OCCURRENCE OF AN EVENT OF DEFAULT WHICH
                  CONTINUES  TO EXIST  THE  PROCEEDS  OF WHICH ARE  REMITTED  TO
                  LAURUS TO BE HELD AS CASH COLLATERAL FOR THE OBLIGATIONS;

                  it will insure the  Collateral in Laurus' name against loss or
         damage by fire, theft,  burglary,  pilferage,  loss in transit and such
         other hazards as Laurus shall specify in amounts and under  policies by
         insurers acceptable to Laurus and all premiums thereon shall be paid by
         the  Assignor and the  policies  delivered  to Laurus.  If the Assignor
         fails to do so, Laurus may procure such  insurance and the cost thereof
         shall be  promptly  reimbursed  by the  Assignor  and shall  constitute
         Obligations;

                  it  will at all  reasonable  times  allow  Laurus  or  Laurus'
         representatives  free  access  to and the  right of  inspection  of the
         Collateral;

                  the Assignor hereby indemnifies and saves Laurus harmless from
         all loss, costs, damage, liability and/or expense, including reasonable
         attorneys'  fees, that Laurus may sustain or incur to enforce  payment,
         performance  or  fulfillment  of any of the  Obligations  and/or in the
         enforcement of this Security Agreement or in the prosecution or defense
         of any action or  proceeding  either  against  the  Assignor  or Laurus
         concerning  any  matter  growing  out  of or in  connection  with  this
         Security  Agreement,  and/or any of the  Obligations  and/or any of the
         Collateral  except to the extent caused by Laurus' own gross negligence
         or  willful   misconduct   (as  determined  by  a  court  of  competent
         jurisdiction in a final and nonappealable decision).

         The  occurrence  of any of the  following  events or  conditions  shall
constitute an "Event of Default" under this Security Agreement:

                  any covenant,  warranty,  representation  or statement made or
         furnished  to Laurus by the  Assignor or on the  Assignor's  behalf was
         false in any material respect when made or furnished, and if subject to
         cure, shall not be cured for a period of fifteen (15) days;

                  the loss,  theft,  substantial  damage,  destruction,  sale or
         encumbrance  to or of any of the  Collateral or the making of any levy,
         seizure or attachment thereof or thereon except to the extent:

                           SUCH LOSS IS COVERED BY INSURANCE  PROCEEDS WHICH ARE
                  USED TO REPLACE THE ITEM OR REPAY LAURUS; OR

                           SAID  LEVY,  SEIZURE  OR  ATTACHMENT  DOES NOT SECURE
                  INDEBTEDNESS  IN EXCESS OF $100,000 AND SUCH LEVY,  SEIZURE OR
                  ATTACHMENT HAS NOT BEEN REMOVED OR OTHERWISE  RELEASED  WITHIN
                  TEN (10) DAYS OF THE CREATION OR THE ASSERTION THEREOF;

                  the  Assignor  shall  become   insolvent,   cease  operations,
         dissolve,  terminate our business existence, make an assignment for the
         benefit of creditors,  suffer the  appointment of a receiver,  trustee,
         liquidator or custodian of all or any part of the Assignor's property;

                  any  proceedings  under any bankruptcy or insolvency law shall
         be commenced  by or against the  Assignor and if commenced  against the
         Assignor shall not be dismissed within thirty (30) days;

                  the  Assignor  shall  repudiate,  purport to revoke or fail to
         perform  any of its  obligations  under  the  Note  (after  passage  of
         applicable cure period, if any); or

                  an Event of Default  (or  similar  term)  shall have  occurred
         under and as defined in the Securities  Purchase Agreement or any other
         Document.

         Upon the occurrence of any Event of Default and at any time thereafter,
Laurus may declare all Obligations  immediately due and payable and Laurus shall
have the remedies of a secured party provided in the Uniform  Commercial Code as
in effect in the State of New York,  this Master  Security  Agreement  and other



applicable  law.  Upon the  occurrence  of any Event of Default  and at any time
thereafter,  Laurus will have the right to take possession of the Collateral and
to  maintain  such  possession  on the  Assignor's  premises  or to  remove  the
Collateral or any part thereof to such other premises as Laurus may desire. Upon
Laurus'  request,  the  Assignor  shall  assemble  the  Collateral  and  make it
available to Laurus at a place  designated  by Laurus.  If any  notification  of
intended disposition of any Collateral is required by law, such notification, if
mailed,  shall be deemed  properly and  reasonably  given if mailed at least ten
(10) days before such  disposition,  postage prepaid,  addressed to the Assignor
either at the  Assignor's  address  shown herein or at any address  appearing on
Laurus' records for the Assignor.  Any proceeds of any disposition of any of the
Collateral  shall be  applied  by  Laurus  to the  payment  of all  expenses  in
connection with the sale of the Collateral, including reasonable attorneys' fees
and other  legal  expenses  and  disbursements  and the  reasonable  expense  of
retaking, holding, preparing for sale, selling, and the like, and any balance of
such proceeds may be applied by Laurus toward the payment of the  Obligations in
such order of application as Laurus may elect,  and the Assignor shall be liable
for any  deficiency.  For the avoidance of doubt,  following the  occurrence and
during the  continuance of an Event of Default,  Laurus shall have the immediate
right to withdraw  any and all monies  contained in the  Restricted  Account and
apply same to the repayment of the  Obligations (in such order of application as
Laurus may elect).

         If the Assignor  defaults in the  performance  or fulfillment of any of
the terms,  conditions,  promises,  covenants,  provisions  or warranties on the
Assignor's  part to be performed or fulfilled under or pursuant to this Security
Agreement,  Laurus may, at its option without  waiving its right to enforce this
Security Agreement according to its terms, immediately or at any time thereafter
and  without  notice to the  Assignor,  perform or fulfill the same or cause the
performance or  fulfillment  of the same for the  Assignor's  account and at the
Assignor's  cost  and  expense,  and the  cost and  expense  thereof  (including
reasonable  attorneys'  fees)  shall be added to the  Obligations  and  shall be
payable on demand with  interest  thereon at the highest rate  permitted by law,
or, at Laurus' option, debited by Laurus from the Restricted Account referred to
in the Restricted Account Agreement.

         The Assignor hereby appoints Laurus, any of Laurus' officers, employees
or any other person or entity whom Laurus may  designate as our  attorney,  with
power to  execute  such  documents  in our  behalf  and to  supply  any  omitted
information and correct patent errors in any documents  executed by the Assignor
or on our behalf; to file financing statements against the Assignor covering the
Collateral (and, in connection with the filing of any such financing statements,
describe the  Collateral as "all assets and all personal  property,  whether now
owned  and/or  hereafter  acquired"  (or  any  substantially  similar  variation
thereof));  to sign the Assignor's name on public  records;  and to do all other
things Laurus deems necessary to carry out this Security Agreement. The Assignor
hereby  ratifies and approve all acts of the attorney and neither Laurus nor the
attorney  will be liable for any acts of  commission  or  omission,  nor for any
error of judgment or mistake of fact or law other than their gross negligence or
willful  misconduct  (as  determined by a court of competent  jurisdiction  in a
final and non-appealable  decision).  This power being coupled with an interest,
is irrevocable so long as any Obligations remains unpaid.

         No delay or failure on Laurus' part in exercising any right,  privilege
or option  hereunder  shall  operate as a waiver of such or of any other  right,
privilege,  remedy or option,  and no waiver  whatever  shall be valid unless in



writing,  signed by Laurus and then only to the extent therein set forth, and no
waiver by Laurus of any default  shall  operate as a waiver of any other default
or of  the  same  default  on a  future  occasion.  Laurus'  books  and  records
containing  entries  with  respect to the  Obligations  shall be  admissible  in
evidence in any action or proceeding, shall be binding upon the Assignor for the
purpose of establishing  the items therein set forth and shall  constitute prima
facie proof  thereof.  Laurus shall have the right to enforce any one or more of
the remedies available to Laurus, successively, alternately or concurrently. The
Assignor agrees to join with Laurus in executing  financing  statements or other
instruments  to the  extent  required  by the  Uniform  Commercial  Code in form
satisfactory  to Laurus and in executing such other  documents or instruments as
may be required or deemed  necessary  by Laurus for  purposes  of  affecting  or
continuing Laurus' security interest in the Collateral.

         This  Security   Agreement  shall  be  governed  by  and  construed  in
accordance  with the laws of the  State of New  York and  cannot  be  terminated
orally. All of the rights, remedies,  options, privileges and elections given to
Laurus  hereunder shall inure to the benefit of Laurus'  successors and assigns.
The term "Laurus" as herein used shall include Laurus, any parent of Laurus, any
of Laurus'  subsidiaries and any co-subsidiaries of Laurus' parent,  whether now
existing or  hereafter  created or acquired,  and all of the terms,  conditions,
promises, covenants,  provisions and warranties of this Security Agreement shall
inure  to  the   benefit  of  each  of  the   foregoing,   and  shall  bind  the
representatives,  successors and assigns of the Assignor. Each of Laurus and the
Assignor  hereby  (a)  waives  any and all right to trial by jury in  litigation
relating to this Security Agreement and the transactions contemplated hereby and
the Assignor hereby agrees not to assert any  counterclaim  in such  litigation,
(b) submit to the nonexclusive  jurisdiction of any New York State court sitting
in the borough of  Manhattan,  the city of New York and (c) waive any  objection
the Assignor or Laurus may have as to the bringing or maintaining of such action
with any such court.

         All notices from Laurus to the Assignor shall be sufficiently  given if
mailed or delivered  to the Assignor at its address set forth in the  Securities
Purchase Agreement and the Security Agreement.

                                          Very truly yours,

                                          MITEK SYSTEMS, INC.

                                          By:
                                             ----------------------------------
                                          Name:
                                               --------------------------------
                                          Title:
                                                -------------------------------

ACKNOWLEDGED:

LAURUS MASTER FUND, LTD.

By:
   ----------------------------------
Name:
     --------------------------------
Title:
      -------------------------------

                          REGISTRATION RIGHTS AGREEMENT

         This  Registration  Rights  Agreement  (this  "Agreement")  is made and
entered into as of June 11, 2004, by and between Mitek Systems, Inc., a Delaware
corporation  (the  "Company"),  and Laurus Master Fund,  Ltd., a Cayman  Islands
company (the "Purchaser").

         This Agreement is made pursuant to the Securities  Purchase  Agreement,
dated as of the date hereof,  by and between the  Purchaser and the Company (the
"Securities  Purchase  Agreement"),  and  pursuant to the Note and the  Warrants
referred to therein.

         The Company and the Purchaser hereby agree as follows:

         12.  Definitions.  Capitalized  terms  used and not  otherwise  defined
herein  that are defined in the  Securities  Purchase  Agreement  shall have the
meanings given such terms in the Securities Purchase Agreement.  As used in this
Agreement, the following terms shall have the following meanings:

         "Commission" means the Securities and Exchange Commission.

         "Common  Stock" means shares of the Company's  common stock,  par value
$0.001 per share.

         "Effectiveness Date" means the 90th day following the date hereof.

         "Effectiveness  Period"  shall  have the  meaning  set forth in Section
2(a).

         "Exchange Act" means the  Securities  Exchange Act of 1934, as amended,
and any successor statute.

         "Filing  Date"  means,  with  respect  to  the  Registration  Statement
required to be filed hereunder,  a date no later than thirty (30) days following
the date  hereof and with  respect  to shares of Common  Stock  issuable  to the
Holder as a result of adjustments to the Fixed Conversion Price made pursuant to
Section 3.4 of the Secured  Convertible Term Note or Section 4 of the Warrant or
otherwise,  thirty (30) days after the occurrence  such event or the date of the
adjustment of the Fixed Conversion Price.

         "Holder" or "Holders"  means the Purchaser or any of its  affiliates or
transferees to the extent any of them hold Registrable Securities.

         "Indemnified Party" shall have the meaning set forth in Section 5(c).

         "Indemnifying Party" shall have the meaning set forth in Section 5(c).

         "Note" has the meaning set forth in the Securities Purchase Agreement.



         "Proceeding" means an action, claim, suit,  investigation or proceeding
(including,  without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.

         "Prospectus"   means  the  prospectus   included  in  the  Registration
Statement  (including,  without  limitation,  a  prospectus  that  includes  any
information  previously  omitted from a prospectus filed as part of an effective
registration  statement  in  reliance  upon  Rule  430A  promulgated  under  the
Securities Act), as amended or supplemented by any prospectus  supplement,  with
respect  to  the  terms  of  the  offering  of any  portion  of the  Registrable
Securities covered by the Registration  Statement,  and all other amendments and
supplements to the  Prospectus,  including  post-effective  amendments,  and all
material  incorporated by reference or deemed to be incorporated by reference in
such Prospectus.

         "Registrable  Securities"  means the shares of Common Stock issued upon
the conversion of the Note and issuable upon exercise of the Warrants.

         "Registration  Statement" means each registration statement required to
be filed hereunder, including the Prospectus, amendments and supplements to such
registration   statement  or  Prospectus,   including  pre-  and  post-effective
amendments,  all exhibits thereto, and all material incorporated by reference or
deemed to be incorporated by reference in such registration statement.

         "Rule 144" means Rule 144 promulgated by the Commission pursuant to the
Securities  Act, as such Rule may be amended  from time to time,  or any similar
rule or regulation  hereafter adopted by the Commission having substantially the
same effect as such Rule.

         "Rule 415" means Rule 415 promulgated by the Commission pursuant to the
Securities  Act, as such Rule may be amended  from time to time,  or any similar
rule or regulation  hereafter adopted by the Commission having substantially the
same effect as such Rule.

         "Rule 424" means Rule 424 promulgated by the Commission pursuant to the
Securities  Act, as such Rule may be amended  from time to time,  or any similar
rule or regulation  hereafter adopted by the Commission having substantially the
same effect as such Rule.

         "Securities Act" means the Securities Act of 1933, as amended,  and any
successor statute.

         "Securities Purchase Agreement" means the agreement between the parties
hereto  calling  for,  among  other  things,  the  issuance  by the Company of a
$3,000,000 convertible Note plus Warrants.

         "Trading  Market" means any of the NASD OTC Bulletin  Board  ("OTCBB"),
NASDAQ SmallCap Market,  the Nasdaq National Market, the American Stock Exchange
or the New York Stock Exchange.

         "Warrants" means the Common Stock purchase  warrants issued pursuant to
the Securities Purchase Agreement.

         13. Registration.


                                        8


                  13.1 On or prior to the Filing Date the Company  shall prepare
and file with the Commission a Registration  Statement  covering the Registrable
Securities  for an offering to be made on a  continuous  basis  pursuant to Rule
415. The Registration  Statement shall be on Form SB-2 (except if the Company is
not then  eligible to register  for resale the  Registrable  Securities  on Form
SB-2, in which case such  registration  shall be on another  appropriate form in
accordance  herewith).  The Company  shall cause the  Registration  Statement to
become effective and remain effective as provided herein.  The Company shall use
its  reasonable  commercial  efforts to cause the  Registration  Statement to be
declared  effective  under the  Securities Act as promptly as possible after the
filing  thereof,  but in any event no later  than the  Effectiveness  Date.  The
Company shall use its  reasonable  commercial  efforts to keep the  Registration
Statement  continuously  effective under the Securities Act until the date which
is the earlier  date of when (i) all  Registrable  Securities  have been sold or
(ii) all Registrable  Securities may be sold  immediately  without  registration
under the  Securities  Act and  without  volume  restrictions  pursuant  to Rule
144(k),  as  determined  by the  counsel to the  Company  pursuant  to a written
opinion  letter  to such  effect,  addressed  and  acceptable  to the  Company's
transfer agent and the affected Holders (the "Effectiveness Period").

                  13.2 If:  (i) the  Registration  Statement  is not filed on or
prior to the  Filing  Date;  (ii) the  Registration  Statement  is not  declared
effective  by  the  Commission  by  the  Effectiveness  Date;  (iii)  after  the
Registration  Statement is filed with and declared  effective by the Commission,
the  Registration  Statement ceases to be effective (by suspension or otherwise)
as to all  Registrable  Securities to which it is required to relate at any time
prior to the expiration of the  Effectiveness  Period  (without being  succeeded
immediately  by  an  additional   registration   statement  filed  and  declared
effective)  for a period of time which shall exceed 30 days in the aggregate per
year or more than 20 consecutive  calendar days (defined as a period of 365 days
commencing on the date the  Registration  Statement is declared  effective);  or
(iv) the Common Stock is not listed or quoted,  or is suspended  from trading on
any Trading Market for a period of three (3) consecutive  Trading Days (provided
the Company shall not have been able to cure such trading  suspension  within 30
days of the notice thereof or list the Common Stock on another Trading  Market);
(any such failure or breach being referred to as an "Event," and for purposes of
clause (i) or (ii) the date on which  such  Event  occurs,  or for  purposes  of
clause  (iii) the date  which such 30 day or 20  consecutive  day period (as the
case may be) is exceeded,  or for purposes of clause (iv) the date on which such
three (3) Trading Day period is exceeded,  being  referred to as "Event  Date"),
then until the applicable  Event is cured,  the Company shall pay to each Holder
an amount in cash, as liquidated damages and not as a penalty, equal to 2.0% for
each thirty (30) day period  (prorated for partial  periods) on a daily basis of
the original  principal  amount of the Note.  While such Event  continues,  such
liquidated  damages shall be paid not less often than each thirty (30) days. Any
unpaid  liquidated  damages  as of the date when an Event has been  cured by the
Company  shall be paid within  three (3) days  following  the date on which such
Event has been cured by the Company.

                  13.3 Within three business days of the Effectiveness Date, the
Company shall cause its counsel to issue a blanket opinion  substantially in the
form  attached  hereto  as  Exhibit  A  subject  to  customary  assumptions  and
exclusions,  to the  transfer  agent  stating  that the shares are subject to an
effective  registration statement and can be reissued free of restrictive legend
upon notice of a sale by Laurus and  confirmation by Laurus that it has complied
with the  prospectus  delivery  requirements,  provided that the Company has not
advised  the  transfer  agent  orally or in writing  that the  opinion  has been


                                       9


withdrawn.  Copies of the blanket opinion required by this Section 2(c) shall be
delivered to Laurus within the time frame set forth above.

         14. Registration Procedures. If and whenever the Company is required by
the provisions  hereof to effect the registration of any Registrable  Securities
under the Securities Act, the Company will, as expeditiously as possible:

                  14.1  prepare and file with the  Commission  the  Registration
Statement with respect to such  Registrable  Securities,  respond as promptly as
possible to any comments received from the Commission,  and use its best efforts
to cause the  Registration  Statement  to become  and remain  effective  for the
Effectiveness Period with respect thereto, and promptly provide to the Purchaser
copies of all filings and Commission letters of comment relating thereto;

                  14.2 prepare and file with the Commission  such amendments and
supplements to the Registration  Statement and the Prospectus used in connection
therewith as may be necessary to comply with the  provisions  of the  Securities
Act with respect to the disposition of all Registrable Securities covered by the
Registration  Statement and to keep such Registration  Statement effective until
the expiration of the Effectiveness Period;

                  14.3  furnish to the  Purchaser  such  number of copies of the
Registration  Statement and the  Prospectus  included  therein  (including  each
preliminary  Prospectus)  as the Purchaser  reasonably may request to facilitate
the public sale or  disposition  of the  Registrable  Securities  covered by the
Registration Statement;

                  14.4 use its  commercially  reasonable  efforts to register or
qualify  the  Purchaser's  Registrable  Securities  covered by the  Registration
Statement under the securities or "blue sky" laws of such  jurisdictions  within
the United States as the Purchaser may reasonably  request,  provided,  however,
that the Company shall not for any such purpose be required to qualify generally
to transact  business as a foreign  corporation in any jurisdiction  where it is
not so  qualified  or to  consent  to  general  service  of  process in any such
jurisdiction;

                  14.5  list  the   Registrable   Securities   covered   by  the
Registration Statement with any securities exchange on which the Common Stock of
the Company is then listed;

                  14.6  immediately  notify  the  Purchaser  at any time  when a
Prospectus  relating  thereto is required to be delivered  under the  Securities
Act,  of the  happening  of any event of which the Company  has  knowledge  as a
result of which the Prospectus contained in such Registration Statement, as then
in effect,  includes an untrue  statement of a material fact or omits to state a
material fact required to be stated  therein or necessary to make the statements
therein not misleading in light of the circumstances then existing; and

                  14.7 make  available  for  inspection by the Purchaser and any
attorney,  accountant  or other agent  retained by the  Purchaser,  all publicly
available,  non-confidential  financial and other records,  pertinent  corporate
documents  and  properties  of the Company,  and cause the  Company's  officers,
directors  and  employees  to supply all  publicly  available,  non-confidential
information  reasonably  requested by the  attorney,  accountant or agent of the
Purchaser.


                                       10


         15.  Registration  Expenses.  All  expenses  relating to the  Company's
compliance  with Sections 2 and 3 hereof,  including,  without  limitation,  all
registration  and filing fees,  printing  expenses,  fees and  disbursements  of
counsel and independent  public  accountants for the Company,  fees and expenses
(including  reasonable  counsel fees) incurred in connection with complying with
state securities or "blue sky" laws, fees of the NASD,  transfer taxes,  fees of
transfer agents and registrars,  are called "Registration Expenses". All selling
commissions applicable to the sale of Registrable Securities, including any fees
and disbursements of any special counsel to the Holders beyond those included in
Registration  Expenses, are called "Selling Expenses." The Company shall only be
responsible for all Registration Expenses.

         16. Indemnification.

                  16.1  In  the  event  of a  registration  of  any  Registrable
Securities under the Securities Act pursuant to this Agreement, the Company will
indemnify and hold harmless the Purchaser, and its officers,  directors and each
other  person,  if any,  who controls  the  Purchaser  within the meaning of the
Securities Act,  against any losses,  claims,  damages or liabilities,  joint or
several,  to which the  Purchaser,  or such persons may become subject under the
Securities  Act or  otherwise,  insofar  as  such  losses,  claims,  damages  or
liabilities  (or actions in respect  thereof) arise out of or are based upon any
untrue  statement or alleged untrue  statement of any material fact contained in
any  Registration   Statement  under  which  such  Registrable  Securities  were
registered under the Securities Act pursuant to this Agreement,  any preliminary
Prospectus or final Prospectus contained therein, or any amendment or supplement
thereof,  or arise out of or are based upon the omission or alleged  omission to
state therein a material fact required to be stated therein or necessary to make
the statements  therein not  misleading,  and will reimburse the Purchaser,  and
each such person for any reasonable legal or other expenses  incurred by them in
connection  with  investigating  or  defending  any such  loss,  claim,  damage,
liability or action;  provided,  however, that the Company will not be liable in
any such  case if and to the  extent  that  any  such  loss,  claim,  damage  or
liability  arises out of or is based upon an untrue  statement or alleged untrue
statement or omission or alleged omission so made in conformity with information
furnished  by or on  behalf  of the  Purchaser  or any such  person  in  writing
specifically for use in any such document.

                  16.2  In  the  event  of a  registration  of  the  Registrable
Securities  under the Securities Act pursuant to this  Agreement,  the Purchaser
will  indemnify and hold harmless the Company,  and its officers,  directors and
each other  person,  if any, who controls the Company  within the meaning of the
Securities Act,  against all losses,  claims,  damages or liabilities,  joint or
several,  to which the  Company or such  persons  may become  subject  under the
Securities  Act or  otherwise,  insofar  as  such  losses,  claims,  damages  or
liabilities  (or actions in respect  thereof) arise out of or are based upon any
untrue  statement or alleged  untrue  statement  of any material  fact which was
furnished in writing by the  Purchaser to the Company  expressly for use in (and
such  information is contained in) the  Registration  Statement under which such
Registrable Securities were registered under the Securities Act pursuant to this
Agreement,  any preliminary Prospectus or final Prospectus contained therein, or
any  amendment  or  supplement  thereof,  or arise out of or are based  upon the
omission or alleged  omission to state  therein a material  fact  required to be
stated therein or necessary to make the statements  therein not misleading,  and
will  reimburse  the Company and each such  person for any  reasonable  legal or


                                       11


other expenses  incurred by them in connection with  investigating  or defending
any such loss, claim, damage, liability or action,  provided,  however, that the
Purchaser  will be liable in any such  case if and only to the  extent  that any
such loss,  claim,  damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission so made in
conformity with information  furnished in writing to the Company by or on behalf
of the Purchaser specifically for use in any such document.  Notwithstanding the
provisions of this  paragraph,  the Purchaser shall not be required to indemnify
any  person or entity in excess  of the  amount of the  aggregate  net  proceeds
received by the  Purchaser in respect of  Registrable  Securities  in connection
with any such registration under the Securities Act.

                  16.3  Promptly  after  receipt  by a party  entitled  to claim
indemnification hereunder (an "Indemnified Party") of notice of the commencement
of any action,  such Indemnified Party shall, if a claim for  indemnification in
respect thereof is to be made against a party hereto obligated to indemnify such
Indemnified Party (an "Indemnifying  Party"),  notify the Indemnifying  Party in
writing thereof,  but the omission so to notify the Indemnifying Party shall not
relieve it from any liability which it may have to such Indemnified  Party other
than under this Section 5(c) and shall only relieve it from any liability  which
it may have to such  Indemnified  Party  under this  Section  5(c) if and to the
extent the Indemnifying  Party is prejudiced by such omission.  In case any such
action shall be brought  against any  Indemnified  Party and it shall notify the
Indemnifying Party of the commencement  thereof, the Indemnifying Party shall be
entitled  to  participate  in and,  to the extent it shall  wish,  to assume and
undertake  the defense  thereof with counsel  satisfactory  to such  Indemnified
Party,  and, after notice from the Indemnifying  Party to such Indemnified Party
of its election so to assume and undertake the defense thereof, the Indemnifying
Party shall not be liable to such Indemnified  Party under this Section 5(c) for
any legal expenses subsequently incurred by such Indemnified Party in connection
with the defense thereof; if the Indemnified Party retains its own counsel, then
the  Indemnified  Party shall pay all fees,  costs and expenses of such counsel,
provided,  however,  that, if the defendants in any such action include both the
indemnified  party and the  Indemnifying  Party and the Indemnified  Party shall
have reasonably  concluded that there may be reasonable defenses available to it
which are different  from or additional to those  available to the  Indemnifying
Party or if the interests of the Indemnified  Party  reasonably may be deemed to
conflict with the interests of the  Indemnifying  Party,  the Indemnified  Party
shall have the right to select one  separate  counsel  and to assume  such legal
defenses and otherwise to  participate  in the defense of such action,  with the
reasonable expenses and fees of such separate counsel and other expenses related
to such participation to be reimbursed by the Indemnifying Party as incurred.

                  16.4 In order to provide for just and  equitable  contribution
in the event of joint  liability  under the  Securities Act in any case in which
either (i) the Purchaser, or any officer,  director or controlling person of the
Purchaser,  makes a claim for indemnification  pursuant to this Section 5 but it
is judicially  determined (by the entry of a final judgment or decree by a court
of competent  jurisdiction and the expiration of time to appeal or the denial of
the last right of appeal) that such  indemnification may not be enforced in such
case  notwithstanding  the fact that this Section 5 provides for indemnification
in such case, or (ii)  contribution  under the Securities Act may be required on
the part of the Purchaser or such officer, director or controlling person of the
Purchaser in  circumstances  for which  indemnification  is provided  under this
Section 5; then,  and in each such case,  the  Company  and the  Purchaser  will
contribute to the aggregate losses, claims, damages or liabilities to which they
may be subject (after  contribution  from others) in such proportion so that the
Purchaser is responsible only for the portion represented by the percentage that


                                       12


the  public  offering  price  of its  securities  offered  by  the  Registration
Statement bears to the public  offering price of all securities  offered by such
Registration  Statement,  provided,  however,  that,  in any such case,  (A) the
Purchaser  will not be required to contribute any amount in excess of the public
offering  price  of  all  such  securities   offered  by  it  pursuant  to  such
Registration  Statement;  and (B) no  person  or  entity  guilty  of  fraudulent
misrepresentation  (within  the  meaning  of  Section  10(f) of the Act) will be
entitled  to  contribution  from any person or entity who was not guilty of such
fraudulent misrepresentation.

         17. Representations and Warranties.

                  17.1 The Common Stock of the Company is registered pursuant to
Section  12(b) or 12(g) of the Exchange Act and,  except with respect to certain
matters which the Company has disclosed to the Purchaser on Schedule 4.21 to the
Securities  Purchase   Agreement,   the  Company  has  timely  filed  all  proxy
statements,  reports,  schedules, forms, statements and other documents required
to be filed by it under the Exchange Act with such timely  filing  including the
filing within the extension  period  obtained  through  filing Form 12b-25.  The
Company  has filed (i) its Annual  Report on Form 10-K for its fiscal year ended
September  30,  2003 and (ii) its  Quarterly  Report on Form 10-Q for the fiscal
quarters  ended  December  31, 2003 and March 31, 2004  (collectively,  the "SEC
Reports").  Each SEC  Report  was,  at the time of its  filing,  in  substantial
compliance  with the  requirements  of its  respective  form and none of the SEC
Reports,  nor the financial  statements (and the notes thereto)  included in the
SEC Reports, as of their respective filing dates, contained any untrue statement
of a material  fact or omitted to state a material  fact  required  to be stated
therein  or  necessary  to  make  the  statements   therein,  in  light  of  the
circumstances  under  which  they  were  made,  not  misleading.  The  financial
statements of the Company  included in the SEC Reports  comply as to form in all
material  respects with  applicable  accounting  requirements  and the published
rules  and  regulations  of  the  Commission  or  other   applicable  rules  and
regulations with respect thereto.  Such financial  statements have been prepared
in accordance with generally accepted accounting  principles ("GAAP") applied on
a consistent  basis during the periods  involved (except (i) as may be otherwise
indicated in such financial  statements or the notes thereto or (ii) in the case
of unaudited interim statements, to the extent they may not include footnotes or
may be  condensed)  and fairly  present in all material  respects the  financial
condition,  the results of operations  and the cash flows of the Company and its
subsidiaries,  on a consolidated basis, as of, and for, the periods presented in
each such SEC Report.

                  17.2 The Common Stock is traded on the OTCBB and satisfies all
requirements for the continuation of such trading . The Company has not received
any  notice  that its  Common  Stock  will be  ineligible  to trade on the OTCBB
(except for prior  notices  which have been fully  remedied)  or that the Common
Stock does not meet all requirements for the continuation of such trading .

                  17.3 Neither the Company,  nor any of its affiliates,  nor any
person acting on its or their behalf, has directly or indirectly made any offers
or sales of any  security  or  solicited  any offers to buy any  security  under
circumstances  that would cause the offering of the  Securities  pursuant to the
Securities  Purchase  Agreement  to be  integrated  with prior  offerings by the
Company for purposes of the  Securities Act which would prevent the Company from
selling the Common Stock pursuant to Rule 506 under the  Securities  Act, or any
applicable  exchange-related  stockholder  approval  provisions,  nor  will  the


                                       13


Company or any of its affiliates or  subsidiaries  take any action or steps that
would  cause  the  offering  of  the  Securities  to be  integrated  with  other
offerings.

                  17.4 The  Warrants,  the Note and the  shares of Common  Stock
which the  Purchaser  may acquire  pursuant to the Warrants and the Note are all
restricted securities under the Securities Act as of the date of this Agreement.
The Company will not issue any stop transfer  order or other order  impeding the
sale and  delivery of any of the  Registrable  Securities  except as required by
applicable federal or state securities laws.

                  17.5 The  Company  understands  the nature of the  Registrable
Securities  issuable  upon the  conversion  of the Note and the  exercise of the
Warrant and recognizes that the issuance of such Registrable Securities may have
a potential  dilutive effect.  The Company  specifically  acknowledges  that its
obligation to issue the  Registrable  Securities is binding upon the Company and
enforceable  regardless  of the dilution such issuance may have on the ownership
interests of other shareholders of the Company.

                  17.6  Except for  agreements  made in the  ordinary  course of
business,  there is no agreement  that has not been filed with the Commission as
an exhibit to a registration  statement or to a form required to be filed by the
Company under the Exchange Act, the breach of which could reasonably be expected
to have a material and adverse  effect on the Company and its  subsidiaries,  or
would  prohibit or otherwise  interfere with the ability of the Company to enter
into and perform any of its  obligations  under this  Agreement  in any material
respect.

                  17.7  The  Company  will  at all  times  have  authorized  and
reserved a sufficient  number of shares of Common Stock for the full  conversion
of the Note and exercise of the Warrants.

         18. Miscellaneous.

                  18.1 Remedies. In the event of a breach by the Company or by a
Holder, of any of their respective obligations under this Agreement, each Holder
or the  Company,  as the case may be, in addition to being  entitled to exercise
all rights  granted  by law and under  this  Agreement,  including  recovery  of
damages,  will be  entitled  to specific  performance  of its rights  under this
Agreement.

                  18.2  No  Piggyback  on  Registrations.  Except  as and to the
extent  specified in Schedule  7(b)  hereto,  neither the Company nor any of its
security  holders (other than the Holders in such capacity  pursuant hereto) may
include  securities of the Company in any Registration  Statement other than the
Registrable  Securities,  and the Company  shall not after the date hereof enter
into any  agreement  providing  any such  right for  inclusion  of shares in the
Registration  Statement  to any of its  security  holders.  Except as and to the
extent specified in Schedule 7(b) hereto, the Company has not previously entered
into any agreement  granting any registration  rights with respect to any of its
securities to any Person that have not been fully satisfied.


                                       14


                  18.3 Compliance. Each Holder covenants and agrees that it will
comply  with the  prospectus  delivery  requirements  of the  Securities  Act as
applicable to it in connection with sales of Registrable  Securities pursuant to
the Registration Statement.

                  18.4  Discontinued  Disposition.  Each  Holder  agrees  by its
acquisition of such  Registrable  Securities that, upon receipt of a notice from
the Company of the  occurrence of a  Discontinuation  Event (as defined  below),
such  Holder  will  forthwith   discontinue   disposition  of  such  Registrable
Securities  under the  applicable  Registration  Statement  until such  Holder's
receipt of the copies of the supplemented Prospectus and/or amended Registration
Statement or until it is advised in writing  (the  "Advice") by the Company that
the use of the applicable  Prospectus  may be resumed,  and, in either case, has
received copies of any additional or supplemental  filings that are incorporated
or deemed to be  incorporated  by reference in such  Prospectus or  Registration
Statement.  The  Company  may  provide  appropriate  stop  orders to enforce the
provisions   of  this   paragraph.   For  purposes  of  this  Section   7(d),  a
"Discontinuation  Event" shall mean (i) when the Commission notifies the Company
whether there will be a "review" of such Registration Statement and whenever the
Commission comments in writing on such Registration Statement (the Company shall
provide true and complete  copies thereof and all written  responses  thereto to
each of the Holders); (ii) any request by the Commission or any other Federal or
state governmental  authority for amendments or supplements to such Registration
Statement or Prospectus or for additional information; (iii) the issuance by the
Commission of any stop order suspending the  effectiveness of such  Registration
Statement covering any or all of the Registrable Securities or the initiation of
any  Proceedings  for that  purpose;  (iv) the  receipt  by the  Company  of any
notification  with respect to the suspension of the  qualification  or exemption
from  qualification  of  any of  the  Registrable  Securities  for  sale  in any
jurisdiction,  or the  initiation  or  threatening  of any  Proceeding  for such
purpose;  and/or (v) the  occurrence  of any event or passage of time that makes
the financial statements included in such Registration  Statement ineligible for
inclusion  therein  or any  statement  made in such  Registration  Statement  or
Prospectus or any document  incorporated or deemed to be incorporated therein by
reference  untrue in any material respect or that requires any revisions to such
Registration  Statement,  Prospectus or other  documents so that, in the case of
such  Registration  Statement  or  Prospectus,  as the case may be,  it will not
contain any untrue  statement  of a material  fact or omit to state any material
fact required to be stated therein or necessary to make the statements  therein,
in light of the circumstances under which they were made, not misleading.

                  18.5  Piggy-Back  Registrations.  If at any  time  during  the
Effectiveness Period there is not an effective  Registration  Statement covering
all of the Registrable Securities and the Company shall determine to prepare and
file with the  Commission a registration  statement  relating to an offering for
its own account or the account of others under the  Securities Act of any of its
equity securities, other than on Form S-4 or Form S-8 (each as promulgated under
the Securities Act) or their then equivalents  relating to equity  securities to
be issued solely in connection with any acquisition of any entity or business or
equity  securities  issuable in connection  with stock option or other  employee
benefit plans, then the Company shall send to each Holder written notice of such
determination and, if within fifteen days after receipt of such notice, any such
Holder  shall  so  request  in  writing,  the  Company  shall  include  in  such
registration  statement  all or any  part of such  Registrable  Securities  such
holder  requests  to be  registered  to the extent the Company may do so without
violating  registration  rights  of  others  which  exist as of the date of this


                                       15


Agreement,  subject to customary  underwriter cutbacks applicable to all holders
of registration  rights and subject to obtaining any required the consent of any
selling stockholder(s) to such inclusion under such registration statement.

                  18.6 Amendments and Waivers. The provisions of this Agreement,
including  the  provisions  of this  sentence,  may not be amended,  modified or
supplemented,  and waivers or consents to departures from the provisions  hereof
may not be given,  unless the same shall be in writing and signed by the Company
and the Holders of the then outstanding Registrable Securities.  Notwithstanding
the  foregoing,  a waiver or consent to depart from the  provisions  hereof with
respect to a matter that relates  exclusively  to the rights of certain  Holders
and that does not directly or indirectly  affect the rights of other Holders may
be given by Holders  of at least a majority  of the  Registrable  Securities  to
which such waiver or consent relates; provided,  however, that the provisions of
this sentence may not be amended, modified, or supplemented except in accordance
with the provisions of the immediately preceding sentence.

                  18.7 Notices.  Any notice or request hereunder may be given to
the Company or the Purchaser at the  respective  addresses set forth below or as
may  hereafter be specified in a notice  designated as a change of address under
this Section 7(g). Any notice or request  hereunder shall be given by registered
or certified  mail,  return receipt  requested,  hand delivery,  overnight mail,
Federal  Express or other  national  overnight  next day carrier  (collectively,
"Courier") or telecopy  (confirmed by mail).  Notices and requests  shall be, in
the case of those by hand delivery,  deemed to have been given when delivered to
any  party to whom it is  addressed,  in the case of those by mail or  overnight
mail,  deemed to have been  given  three (3)  business  days after the date when
deposited  in the  mail or with the  overnight  mail  carrier,  in the case of a
Courier, the next business day following timely delivery of the package with the
Courier,  and, in the case of a telecopy,  when confirmed.  The address for such
notices and communications shall be as follows:

         If to the Company:                 Mitek Systems, Inc.
                                            14145 Danielson Street
                                            Suite B
                                            Poway, California 92064

                                            Attention: Chief Financial Officer
                                            Facsimile: 858-513-4622

                                            With a copy to:

                                            Luce Forward Hamilton & Scripps LLP
                                            600 West Broadway, Suite 2600
                                            San Diego, California   92101

                                            Attention: P. Blake Allen, Esq.
                                            Facsimile: 619-645-5357


                                       16


         If to a Purchaser:       To the address set forth under such Purchaser
                                  name on the signature pages hereto.

         If to any other Person who is then the
         registered Holder:

or such other address as may be  designated  in writing  hereafter in accordance
with this Section 7(g) by such Person.

                  18.8 Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors  and permitted  assigns of each of
the parties and shall inure to the benefit of each  Holder.  The Company may not
assign its rights or obligations  hereunder without the prior written consent of
each Holder.  Each Holder may assign their  respective  rights  hereunder in the
manner  and to the  Persons  as  permitted  under the  Notes and the  Securities
Purchase Agreement with the prior written consent of the Company,  which consent
shall not be unreasonably withheld.

                  18.9  Execution  and  Counterparts.   This  Agreement  may  be
executed in any number of counterparts,  each of which when so executed shall be
deemed to be an original and, all of which taken together  shall  constitute one
and the  same  Agreement.  In the  event  that any  signature  is  delivered  by
facsimile  transmission,  such signature shall create a valid binding obligation
of the party  executing (or on whose behalf such signature is executed) the same
with the same force and effect as if such facsimile  signature were the original
thereof.

                  18.10   Governing   Law.   All   questions    concerning   the
construction,  validity,  enforcement and interpretation of this Agreement shall
be governed by and construed  and enforced in accordance  with the internal laws
of the State of New York,  without  regard to the principles of conflicts of law
thereof. Each party agrees that all Proceedings  concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement shall
be commenced  exclusively in the state and federal courts sitting in the City of
New York, Borough of Manhattan.  Each party hereto hereby irrevocably submits to
the exclusive  jurisdiction  of the state and federal courts sitting in the City
of New York,  Borough of Manhattan for the adjudication of any dispute hereunder
or in  connection  herewith  or with  any  transaction  contemplated  hereby  or
discussed herein, and hereby irrevocably waives, and agrees not to assert in any
Proceeding,  any claim that it is not personally  subject to the jurisdiction of
any such court,  that such  Proceeding  is improper.  Each party  hereto  hereby
irrevocably  waives  personal  service of process and consents to process  being
served in any such  Proceeding  by  mailing a copy  thereof  via  registered  or
certified  mail or overnight  delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this  Agreement and agrees that
such service shall constitute good and sufficient  service of process and notice
thereof.  Nothing contained herein shall be deemed to limit in any way any right
to serve  process in any manner  permitted  by law.  Each  party  hereto  hereby
irrevocably  waives,  to the fullest extent permitted by applicable law, any and
all right to trial by jury in any legal proceeding arising out of or relating to
this Agreement or the transactions  contemplated  hereby.  If either party shall
commence a Proceeding to enforce any provisions of a Transaction Document,  then
the prevailing  party in such Proceeding  shall be reimbursed by the other party


                                       17


for its reasonable attorneys fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such Proceeding.

                  18.11 Cumulative  Remedies.  The remedies  provided herein are
cumulative and not exclusive of any remedies provided by law.

                  18.12  Severability.  If  any  term,  provision,  covenant  or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants  and  restrictions  set forth  herein  shall  remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto  shall use their  reasonable  efforts to find and  employ an  alternative
means to achieve the same or substantially  the same result as that contemplated
by such term,  provision,  covenant or restriction.  It is hereby stipulated and
declared to be the  intention of the parties  that they would have  executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.

                  18.13  Headings.  The  headings  in  this  Agreement  are  for
convenience  of  reference  only and  shall not limit or  otherwise  affect  the
meaning hereof.

                   [BALANCE OF PAGE INTENTIONALLY LEFT BLANK;
                             SIGNATURE PAGE FOLLOWS]



                                       18


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

MITEK SYSTEMS, INC.                        LAURUS MASTER FUND, LTD.

By:                                        By:
   ----------------------------------         ----------------------------------
Name:                                      Name:
     --------------------------------           --------------------------------
Title:                                     Title:
      -------------------------------            -------------------------------

                                           Address for Notices:

                                           825 Third Avenue - 14th Floor
                                           New York, NY  10022
                                           Attention: David Grin
                                           Facsimile: 212-541-4434



                                       19


                                    EXHIBIT A


                                [Month __, 2004]


Mellon Investor Services
400 South Hope Street, 4th Floor
Los Angeles, CA   90071
Attn:  ________________

         Re: Mitek Systems, Inc. Registration Statement on Form SB-2
             -------------------------------------------------------

Ladies and Gentlemen:

         As  counsel  to  Mitek  Systems,  Inc.,  a  Delaware  corporation  (the
"Company"),  we have been  requested to render our opinion to you in  connection
with the resale by the  individuals  or  entitles  listed on Schedule A attached
hereto (the  "Selling  Stockholders"),  of an aggregate of [amount]  shares (the
"Shares") of the Company's Common Stock.

         A Registration Statement on Form SB-2 under the Securities Act of 1933,
as amended  (the  "Act"),  with respect to the resale of the Shares was declared
effective by the  Securities  and Exchange  Commission on [date].  Enclosed is a
copy of the Prospectus  dated [date]  contained in such  Registration  Statement
(the "Prospectus").  We understand that the Shares are to be offered and sold in
the manner described in the Prospectus.

         Except as expressly set forth herein,  if a Selling  Stockholder  sells
any of the Shares in accordance  with the Prospectus,  Mellon Investor  Services
("Mellon")  may  effect  transfers  of such  Shares  so  sold  by  such  Selling
Stockholder provided the following  requirements are satisfied:  (i) the Selling
Stockholder  resells such Shares  presented for transfer in accordance  with the
terms of the Prospectus,  including the Prospectus  delivery  requirements;  and
(ii) as of the date of the  particular  transfer,  Mellon has not been  notified
that the Registration Statement is no longer effective.

         In the event a certificate covering Shares, which have been sold by the
Selling Stockholder pursuant to the Prospectus, is presented for the transfer of
less than the total number of shares represented by such certificate, the shares
so sold by a Selling  Stockholder may be transferred without restrictive legend;
however,  the  shares  remaining  which  are  to  be  returned  to  the  Selling
Stockholder  shall  bear  the  identical  legend(s)  as  those  affixed  to  the
certificate representing the shares presented for transfer.

                                                 Very truly yours,



                                                 [Company counsel]



                                   SCHEDULE A


                                                                    Shares
        Selling Stockholder                                     Being Offered
        -------------------                                     -------------

THIS NOTE AND THE COMMON STOCK  ISSUABLE  UPON  CONVERSION OF THIS NOTE HAVE NOT
BEEN  REGISTERED  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED,  OR ANY STATE
SECURITIES LAWS. THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS
NOTE MAY NOT BE SOLD,  OFFERED FOR SALE,  PLEDGED OR HYPOTHECATED IN THE ABSENCE
OF AN  EFFECTIVE  REGISTRATION  STATEMENT  AS TO THIS  NOTE  UNDER  SAID ACT AND
APPLICABLE   STATE   SECURITIES  LAWS  OR  AN  OPINION  OF  COUNSEL   REASONABLY
SATISFACTORY TO MITEK SYSTEMS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.

                          SECURED CONVERTIBLE TERM NOTE

         FOR VALUE RECEIVED,  MITEK SYSTEMS,  INC., a Delaware  corporation (the
"BORROWER"),  hereby  promises  to pay to LAURUS  MASTER  FUND,  LTD.,  a Cayman
Islands  company,  c/o Ironshore  Corporate  Services Ltd.,  P.O. Box 1234 G.T.,
Queensgate  House,  South Church  Street,  Grand Cayman,  Cayman  Islands,  Fax:
345-949-9877 (the "HOLDER") or its registered assigns or successors in interest,
on order,  the sum of Three  Million  Dollars  ($3,000,000),  together  with any
accrued and unpaid interest  hereon,  on June 11, 2007 (the "MATURITY  DATE") if
not sooner paid.

         Capitalized  terms  used  herein  without  definition  shall  have  the
meanings ascribed to such terms in that certain  Securities  Purchase  Agreement
dated as of the date hereof  between the Borrower and the Holder (the  "PURCHASE
AGREEMENT").

The following terms shall apply to this Note:

                                    ARTICLE I
                             INTEREST & AMORTIZATION

         1.1(a) Interest Rate. Subject to Sections 4.11 and 5.6 hereof, interest
payable on this Note  shall  accrue at a rate per annum  (the  "Interest  Rate")
equal to the "prime  rate"  published  in The Wall Street  Journal  from time to
time, plus one percent (1.0%). The prime rate shall be increased or decreased as
the case may be for each  increase  or  decrease  in the prime rate in an amount
equal to such  increase  or  decrease  in the  prime  rate;  each  change  to be
effective  as of the day of the  change  in such  rate.  Interest  shall  be (i)
calculated on the basis of a 360 day year, and (ii) payable monthly, in arrears,
commencing  on July 1, 2004 and on the first  business  day of each  consecutive
calendar month  thereafter  until the Maturity Date (and on the Maturity  Date),
whether by acceleration or otherwise (each, a "REPAYMENT DATE").

         1.1 (b) Interest Rate Adjustment. The Interest Rate shall be calculated
on the last business day of each month hereafter until the Maturity Date (each a
"Determination Date") and shall be subject to adjustment as set forth herein. If
(i) the Borrower shall have registered the shares of the Borrower's common stock
underlying each of the conversion of the Note and that certain warrant issued to
Holder on a  registration  statement  declared  effective by the  Securities and
Exchange  Commission (the "SEC"), and (ii) the market price (the "Market Price")
of the Common Stock as reported by Bloomberg,  L.P. on the Principal  Market (as
defined  below)  for  the  five  (5)  trading  days   immediately   preceding  a
Determination  Date exceeds the then  applicable  Fixed  Conversion  Price by at
least twenty five percent (25%),  the Interest Rate for the succeeding  calendar
month shall  automatically be reduced by 200 basis points (200 b.p.) (2.0.%) for


                                       1


each  incremental  twenty five percent (25%) increase in the Market Price of the
Common  Stock  above the then  applicable  Fixed  Conversion  Price.  If (i) the
Borrower shall not have  registered  the shares of the  Borrower's  common stock
underlying the conversion of the Note and that certain  warrant issued to Holder
on a  registration  statement  declared  effective by the SEC and which  remains
effective,  and (ii)  the  Market  Price of the  Common  Stock  as  reported  by
Bloomberg,  L.P.  on  the  principal  market  for  the  five  (5)  trading  days
immediately  preceding a Determination  Date exceeds the then  applicable  Fixed
Conversion  Price by at least twenty five percent  (25%),  the Interest Rate for
the  succeeding  calendar  month shall  automatically  be decreased by 100 basis
points  (100 b.p.)  (1.0.%)  for each  incremental  twenty  five  percent  (25%)
increase in the Market Price of the Common Stock above the then applicable Fixed
Conversion  Price. In no event shall the Interest Rate be less than zero percent
(0%).

         1.2 Minimum  Monthly  Principal  Payments.  Amortizing  payments of the
aggregate  principal  amount  outstanding  under  this  Note  at any  time  (the
"PRINCIPAL AMOUNT") shall begin on December 1, 2004 and shall recur on the first
business day of each succeeding  month thereafter until the Maturity Date (each,
an  "AMORTIZATION  DATE").  Subject to Article 3 below,  beginning  on the first
Amortization  Date,  the Borrower  shall make monthly  payments to the Holder on
each Repayment Date, each in the amount of $90,909.09, together with any accrued
and unpaid interest to date on such portion of the Principal Amount plus any and
all other amounts which are then owing under this Note,  the Purchase  Agreement
or any  other  Related  Agreement  but  have not been  paid  (collectively,  the
"MONTHLY AMOUNT"). Any Principal Amount that remains outstanding on the Maturity
Date shall be due and payable on the Maturity Date.

                                   ARTICLE II
                              CONVERSION REPAYMENT

         2.1 (a) Payment of Monthly  Amount in Cash or Common Stock.  Each month
by the fifth (5th)  business  day prior to each  Amortization  Date (the "NOTICE
DATE"),  the Holder  shall  deliver to Borrower a written  notice in the form of
Exhibit B attached  hereto  converting  the Monthly  Amount  payable on the next
Repayment Date in either cash or Common Stock, or a combination of both (each, a
"REPAYMENT NOTICE").  If a Repayment Notice is not delivered by the Holder on or
before the  applicable  Notice Date for such Repayment  Date,  then the Borrower
shall pay the Monthly  Amount due on such Repayment Date in cash. Any portion of
the Monthly Amount paid in cash on a Repayment Date, shall be paid to the Holder
an amount equal to 102% of the principal  portion of the Monthly  Amount due and
owing to Holder on the Repayment  Date. If the Holder  converts all or a portion
of the Monthly Amount in shares of Common Stock as provided  herein,  the number
of such shares to be issued by the Borrower to the Holder on such Repayment Date
shall be the number determined by dividing (x) the portion of the Monthly Amount
to be  paid  in  shares  of  Common  Stock,  by (y) the  then  applicable  Fixed
Conversion  Price. For purposes  hereof,  the initial "FIXED  CONVERSION  PRICE"
means $0.70.

         (b) Monthly Amount Conversion  Guidelines.  Subject to Sections 2.1(a),
2.2, and 3.2 hereof,  the Holder  shall  convert all or a portion of the Monthly
Amount  due on each  Repayment  Date in shares of  Common  Stock if the  average
closing  price of the  Common  Stock  as  reported  by  Bloomberg,  L.P.  on the
Principal  Market  for the five (5)  trading  days  immediately  preceding  such


                                       2


Repayment Date was greater than or equal to 110% of the Fixed Conversion  Price,
provided,  however,  that such conversions  shall not exceed twenty five percent
(25%) of the aggregate  dollar  trading  volume of the Common Stock for the five
(5) day trading period immediately  preceding delivery of a Notice of Conversion
to the Borrower. Any part of the Monthly Amount due on a Repayment Date that the
Holder  has not  converted  into  shares  of Common  Stock  shall be paid by the
Borrower in cash on such  Repayment  Date. Any part of the Monthly Amount due on
such Repayment Date which must be paid in cash (as a result of the closing price
of the Common  Stock on one or more of the five (5) trading days  preceding  the
applicable  Repayment Date being less than 110% of the Fixed  Conversion  Price)
shall be paid in cash at the rate of 102% of the Monthly Amount otherwise due on
such Repayment Date, within three (3) business days of the applicable  Repayment
Date.

         2.2 No Effective Registration. Notwithstanding anything to the contrary
herein,  none of the Borrower's  obligations to the Holder may be converted into
Common Stock unless (i) either (x) an effective current  Registration  Statement
(as defined in the Registration  Rights Agreement) covering the shares of Common
Stock to be issued in connection with satisfaction of such obligations exists or
(y) an exemption from  registration of the Common Stock is available to pursuant
to Rule 144 of the Securities Act and (ii) no Event of Default  hereunder exists
and is  continuing,  unless such Event of Default is cured within any applicable
cure period or is otherwise  waived in writing by the Holder in whole or in part
at the Holder's option.

         2.3 Optional  Redemption in Cash.  The Borrower will have the option of
prepaying  this Note  ("OPTIONAL  REDEMPTION")  by paying to the Holder a sum of
money equal to one hundred twenty percent (120%) of the principal amount of this
Note  together  with accrued but unpaid  interest  thereon and any and all other
sums due, accrued or payable to the Holder arising under this Note, the Purchase
Agreement, or any Related Agreement (the "REDEMPTION AMOUNT") outstanding on the
day written notice of redemption  (the "NOTICE OF  REDEMPTION")  is given to the
Holder.  The  Notice of  Redemption  shall  specify  the date for such  Optional
Redemption  (the  "REDEMPTION  PAYMENT  DATE")  which  date  shall be seven  (7)
business  days  after the date of the  Notice  of  Redemption  (the  "REDEMPTION
PERIOD").  A Notice of  Redemption  shall not be  effective  with respect to any
portion  of this Note for which the  Holder  has a pending  election  to convert
pursuant to Section  3.1,  or for  conversions  initiated  or made by the Holder
pursuant to Section 3.1 during the  Redemption  Period.  The  Redemption  Amount
shall be determined as if such Holder's conversion  elections had been completed
immediately  prior to the date of the Notice of  Redemption.  On the  Redemption
Payment Date, the Redemption Amount must be paid in good funds to the Holder. In
the event the  Borrower  fails to pay the  Redemption  Amount on the  Redemption
Payment Date as set forth herein,  then such Redemption  Notice will be null and
void.

                                   ARTICLE III
                                CONVERSION RIGHTS

         3.1. Holder's  Conversion  Rights. The Holder shall have the right, but
not  the  obligation,  to  convert  all or any  portion  of the  then  aggregate


                                       3


outstanding  principal amount of this Note,  together with interest and fees due
hereon,  into shares of Common  Stock  subject to the terms and  conditions  set
forth in this Article III. The Holder may exercise such right by delivery to the
Borrower of a written  notice of  conversion  not less than one (1) day prior to
the date upon which such conversion shall occur.

         3.2 Conversion Limitation. Notwithstanding anything contained herein to
the contrary,  the Holder shall not be entitled to convert pursuant to the terms
of this Note an amount that would be convertible  into that number of Conversion
Shares which would exceed the difference  between the number of shares of Common
Stock  beneficially  owned by such Holder or issuable  upon exercise of warrants
held by such Holder and 4.99% of the  outstanding  shares of Common Stock of the
Borrower.  For the purposes of the immediately  preceding  sentence,  beneficial
ownership  shall be determined in accordance  with Section 13(d) of the Exchange
Act and Regulation  13d-3  thereunder.  The Holder may void the Conversion Share
limitation  described  in this  Section  3.2 upon 75 days  prior  notice  to the
Borrower or without any notice requirement upon an Event of Default.

         3.3 Mechanics of Holder's Conversion.  (a) In the event that the Holder
elects to convert this Note into Common  Stock,  the Holder shall give notice of
such  election by  delivering  an executed and  completed  notice of  conversion
("NOTICE OF  CONVERSION")  to the Borrower and such Notice of  Conversion  shall
provide a  breakdown  in  reasonable  detail of the  Principal  Amount,  accrued
interest  and fees being  converted.  On each  Conversion  Date (as  hereinafter
defined) and in accordance with its Notice of Conversion,  the Holder shall make
the appropriate reduction to the Principal Amount,  accrued interest and fees as
entered in its records and shall provide  written notice thereof to the Borrower
within two (2) business  days after the  Conversion  Date.  Each date on which a
Notice of  Conversion  is delivered or  telecopied to the Borrower in accordance
with the provisions  hereof shall be deemed a Conversion  Date (the  "CONVERSION
DATE").  A form of Notice of  Conversion to be employed by the Holder is annexed
hereto as Exhibit A. (a)

         (b)  Pursuant to the terms of the Notice of  Conversion,  the  Borrower
will issue  instructions  to the  transfer  agent  accompanied  by an opinion of
counsel  within one (1)  business day of the date of the delivery to Borrower of
the Notice of  Conversion  and shall cause the  transfer  agent to transmit  the
certificates  representing the Conversion  Shares to the Holder by crediting the
account of the Holder's  designated broker with the Depository Trust Corporation
("DTC") through its Deposit  Withdrawal Agent Commission  ("DWAC") system within
three  (3)  business  days  after  receipt  by the  Borrower  of the  Notice  of
Conversion (the "DELIVERY  DATE"). In the case of the exercise of the conversion
rights set forth herein the  conversion  privilege  shall be deemed to have been
exercised  and the  Conversion  Shares  issuable upon such  conversion  shall be
deemed to have been  issued  upon the date of  receipt  by the  Borrower  of the
Notice of Conversion. The Holder shall be treated for all purposes as the record
holder of such Common  Stock,  unless the Holder  provides the Borrower  written
instructions to the contrary.

         3.4 Conversion Mechanics.

         (a) The  number  of  shares  of  Common  Stock to be  issued  upon each
conversion  of this Note shall be  determined  by dividing  that  portion of the
principal and interest and fees to be converted,  if any, by the then applicable
Fixed Conversion Price. In the event of any conversions of outstanding principal
amount under this Note in part  pursuant to this Article III,  such  conversions
shall be  deemed to  constitute  conversions  of  outstanding  principal  amount
applying to Monthly Amounts for the remaining  Repayment Dates in  chronological
order.  By way of  example,  if the  original  principal  amount of this Note is
$200,000 and the Holder converted $0 of such original  principal amount prior to
the first Repayment  Date,  then (1) the principal  amount of the Monthly Amount
due on the first Repayment Date would equal $0, (2) the principal  amount of the


                                       4


Monthly  Amount  due on the  second  Repayment  Date  would  equal $ and (3) the
principal amount of the Monthly Amount due on the third Repayment Dates would be
$18,181.81.

         (b) The Fixed  Conversion  Price and number and kind of shares or other
securities to be issued upon  conversion  is subject to adjustment  from time to
time upon the occurrence of certain events, as follows:

         A. Stock Splits,  Combinations  and Dividends.  If the shares of Common
Stock are  subdivided or combined into a greater or smaller  number of shares of
Common  Stock,  or if a dividend is paid on the Common Stock in shares of Common
Stock, the Fixed  Conversion Price or the Conversion  Price, as the case may be,
shall be  proportionately  reduced  in case of  subdivision  of  shares or stock
dividend or  proportionately  increased in the case of combination of shares, in
each  such case by the ratio  which the total  number of shares of Common  Stock
outstanding  immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.

         B. During the period the  conversion  right  exists,  the Borrower will
reserve from its  authorized  and unissued  Common Stock a sufficient  number of
shares to provide for the issuance of Common Stock upon the full  conversion  of
this Note. The Borrower represents that upon issuance,  such shares will be duly
and validly issued, fully paid and non-assessable.  The Borrower agrees that its
issuance of this Note shall  constitute full authority to its officers,  agents,
and transfer agents who are charged with the duty of executing and issuing stock
certificates  to  execute  and issue the  necessary  certificates  for shares of
Common Stock upon the conversion of this Note.

         C. Share  Issuances.  Subject to the provisions of this Section 3.4, if
the Borrower  shall at any time prior to the  conversion or repayment in full of
the Principal Amount issue any shares of Common Stock or securities  convertible
into Common  Stock to a person  other than the Holder  (except  (i)  pursuant to
Subsections  A  or B  above;  (ii)  pursuant  to  options,  warrants,  or  other
obligations  to issue  shares  outstanding  on the date hereof as  disclosed  to
Holder in writing;  or (iii)  pursuant to options  that may be issued  under any
employee  incentive  stock option and/or any qualified stock option plan adopted
by the Borrower) for a consideration per share (the "Offer Price") less than the
Fixed  Conversion  Price in effect at the time of such issuance,  then the Fixed
Conversion  Price  shall be  immediately  reset to such lower Offer Price at the
time of issuance of such securities.

         D.  Reclassification,  etc.  If the  Borrower  at any  time  shall,  by
reclassification  or  otherwise,  change  the  Common  Stock  into the same or a
different  number of  securities  of any class or classes,  this Note, as to the
unpaid Principal Amount and accrued interest thereon, shall thereafter be deemed
to evidence the right to purchase an adjusted number of such securities and kind
of  securities  as would have been  issuable  as the result of such  change with
respect to the Common Stock immediately prior to such  reclassification or other
change.

         3.5 Issuance of New Note.  Upon any partial  conversion of this Note, a
new Note  containing  the same date and  provisions  of this Note shall,  at the
request of the Holder, be issued by the Borrower to the Holder for the principal
balance of this Note and interest  which shall not have been  converted or paid.


                                       5


The Borrower will pay no costs,  fees or any other  consideration  to the Holder
for the production and issuance of a new Note.

                                   ARTICLE IV
                                EVENTS OF DEFAULT

           Upon the occurrence and continuance of an Event of Default beyond any
applicable grace period, the Holder may make all sums of principal, interest and
other fees then remaining unpaid hereon and all other amounts payable  hereunder
immediately due and payable.  In the event of such an acceleration,  within five
(5) days after written notice from Holder to Borrower (each  occurrence  being a
"DEFAULT NOTICE PERIOD") the amount due and owing to the Holder shall be 130% of
the outstanding  principal  amount of the Note (plus accrued and unpaid interest
and fees,  if any) (the  "DEFAULT  PAYMENT").  If, with  respect to any Event of
Default,  the Borrower cures the Event of Default,  the Event of Default will be
deemed to no longer  exist and any rights and remedies of Holder  pertaining  to
such Event of Default will be of no further force or effect. The Default Payment
shall be applied  first to any fees due and  payable to Holder  pursuant  to the
Note or the Related  Agreements,  then to accrued and unpaid interest due on the
Note and then to outstanding principal balance of the Note.

         The occurrence of any of the following events set forth in Sections 4.1
through 4.10, inclusive, is an "EVENT OF DEFAULT":

         4.1 Failure to Pay  Principal,  Interest or other  Fees.  The  Borrower
fails to pay when due any  installment  of  principal,  interest  or other  fees
hereon in accordance herewith,  or the Borrower fails to pay when due any amount
due under any other  promissory  note issued by Borrower,  and in any such case,
such failure  shall  continue for a period of three (3) days  following the date
upon which any such payment was due.

         4.2 Breach of  Covenant.  The  Borrower  breaches any covenant or other
term or condition of this Note, the Purchase  Agreement or any Related Agreement
in any material  respect and such breach,  if subject to cure,  continues  for a
period of fifteen (15) days after the occurrence thereof.

         4.3 Breach of  Representations  and Warranties.  Any  representation or
warranty of the Borrower  made  herein,  in the  Purchase  Agreement,  or in any
Related  Agreement  shall be false or misleading in any material  respect on the
date that such representation or warranty was made or deemed made.

         4.4 Receiver or Trustee.  The Borrower shall make an assignment for the
benefit of creditors,  or apply for or consent to the  appointment of a receiver
or trustee for it or for a substantial part of its property or business; or such
a receiver or trustee shall otherwise be appointed.

         4.5 Judgments.  Any money judgment, writ or similar final process shall
be entered or filed  against the Borrower or any of its property or other assets
for more than $50,000,  and shall remain  unvacated,  unbonded or unstayed for a
period of thirty (30) days.


                                       6


         4.6 Bankruptcy. Bankruptcy,  insolvency,  reorganization or liquidation
proceedings  or other  proceedings or relief under any bankruptcy law or any law
for the relief of debtors shall be instituted by or against the Borrower.

         4.7 Stop Trade.  An SEC stop trade order or  Principal  Market  trading
suspension of the Common Stock shall be in effect for five (5) consecutive  days
or five (5) days during a period of ten (10) consecutive days,  excluding in all
cases a  suspension  of all trading on a  Principal  Market,  provided  that the
Borrower shall not have been able to cure such trading  suspension within thirty
(30) days of the notice  thereof or list the Common  Stock on another  Principal
Market  within sixty (60) days of such notice.  The  "Principal  Market" for the
Common Stock shall include the NASD OTC Bulletin Board,  NASDAQ SmallCap Market,
NASDAQ  National  Market  System,  American  Stock  Exchange,  or New York Stock
Exchange  (whichever  of the  foregoing  is at the  time the  principal  trading
exchange or market for the Common  Stock,  or any  securities  exchange or other
securities market on which the Common Stock is then being listed or traded.

         4.8 Failure to Deliver Common Stock or  Replacement  Note. The Borrower
shall fail (i) to timely deliver  Common Stock to the Holder  pursuant to and in
the form required by this Note, and Section 9 of the Purchase Agreement, if such
failure  to  timely  deliver  Common  Stock  shall not be cured  within  two (2)
business days or (ii) to deliver a  replacement  Note to Holder within seven (7)
business days  following  the required  date of such  issuance  pursuant to this
Note, the Purchase  Agreement or any Related  Agreement (to the extent  required
under such agreements).

         4.9  Default  Under  Related   Agreements  or  Other  Agreements.   The
occurrence  and  continuance  of any Event of Default as defined in the  Related
Agreements   or  any  event  of  default  (or  similar  term)  under  any  other
indebtedness.

         4.10 Change in Control.  The occurrence of a change in the  controlling
ownership of the Company.

                           DEFAULT RELATED PROVISIONS

         4.11 Payment Grace Period.  Following the occurrence and continuance of
an Event of Default beyond any applicable  cure period  hereunder,  the Borrower
shall pay the Holder a default  interest  rate of two percent  (2%) per month on
all amounts  due and owing  under the Note,,  which  default  interest  shall be
payable upon demand.

         4.12  Conversion  Privileges.  The  conversion  privileges set forth in
Article  III shall  remain in full  force and effect  immediately  from the date
hereof and until this Note is paid in full.

         4.13  Cumulative  Remedies.  The  remedies  under  this  Note  shall be
cumulative.

                                    ARTICLE V
                                  MISCELLANEOUS

         5.1 Failure or Indulgence  Not Waiver.  No failure or delay on the part
of the Holder hereof in the exercise of any power, right or privilege  hereunder
shall operate as a waiver thereof,  nor shall any single or partial  exercise of


                                       7


any such power, right or privilege preclude other or further exercise thereof or
of any other  right,  power or  privilege.  All  rights  and  remedies  existing
hereunder  are  cumulative  to, and not  exclusive  of,  any rights or  remedies
otherwise available.

         5.2 Notices.  Any notice herein required or permitted to be given shall
be in writing and shall be deemed  effectively given: (a) upon personal delivery
to the party  notified,  (b) when sent by  confirmed  telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day,  (c) five days after  having been sent by  registered  or  certified  mail,
return receipt requested,  postage prepaid,  or (d) one day after deposit with a
nationally  recognized  overnight  courier,  specifying next day delivery,  with
written  verification  of  receipt.  All  communications  shall  be  sent to the
Borrower  at  the  address  provided  in  the  Purchase  Agreement  executed  in
connection  herewith,  and to the Holder at the address provided in the Purchase
Agreement  for such  Holder,  with a copy to John E.  Tucker,  Esq.,  825  Third
Avenue,  14th Floor, New York, New York 10022,  facsimile number (212) 541-4434,
or at such other address as the Borrower or the Holder may designate by ten days
advance written notice to the other parties hereto. A Notice of Conversion shall
be deemed given when made to the Borrower pursuant to the Purchase Agreement.

         5.3 Amendment Provision.  The term "Note" and all reference thereto, as
used  throughout  this  instrument,  shall mean this  instrument  as  originally
executed,  or  if  later  amended  or  supplemented,   then  as  so  amended  or
supplemented,  and any  successor  instrument  issued  pursuant  to Section  3.5
hereof, as it may be amended or supplemented.

         5.4 Assignability. This Note shall be binding upon the Borrower and its
successors  and  assigns,  and shall  inure to the benefit of the Holder and its
successors and assigns, and may be assigned by the Holder in accordance with the
requirements of the Purchase  Agreement.  This Note shall not be assigned by the
Borrower without the consent of the Holder.

         5.5  Governing  Law.  This Note shall be governed by and  construed  in
accordance with the laws of the State of New York,  without regard to principles
of  conflicts  of laws.  Any action  brought by either  party  against the other
concerning the transactions contemplated by this Agreement shall be brought only
in the state courts of New York or in the federal courts located in the state of
New York.  Both  parties and the  individual  signing this Note on behalf of the
Borrower  agree to submit to the  jurisdiction  of such courts.  The  prevailing
party  shall  be  entitled  to  recover  from the  other  party  its  reasonable
attorney's  fees and  costs.  In the event  that any  provision  of this Note is
invalid or unenforceable  under any applicable statute or rule of law, then such
provision  shall  be  deemed  inoperative  to the  extent  that it may  conflict
therewith  and shall be deemed  modified to conform with such statute or rule of
law. Any such provision which may prove invalid or  unenforceable  under any law
shall not affect the validity or unenforceability of any other provision of this
Note. Nothing contained herein shall be deemed or operate to preclude the Holder
from  bringing  suit or taking  other legal  action  against the Borrower in any
other  jurisdiction  to  collect on the  Borrower's  obligations  to Holder,  to


                                       8


realize on any  collateral  or any other  security for such  obligations,  or to
enforce a judgment or other court in favor of the Holder.

         5.6  Maximum  Payments.  Nothing  contained  herein  shall be deemed to
establish  or require  the  payment of a rate of  interest  or other  charges in
excess of the maximum permitted by applicable law. In the event that the rate of
interest  required  to be paid or other  charges  hereunder  exceed the  maximum
permitted by such law, any payments in excess of such maximum  shall be credited
against  amounts  owed by the  Borrower  to the Holder and thus  refunded to the
Borrower.

         5.7  Security  Interest.  The  holder of this  Note has been  granted a
security  interest in certain  assets of the Borrower more fully  described in a
Security Agreement dated as of the date hereof.

         5.8  Construction.  Each  party  acknowledges  that its  legal  counsel
participated in the preparation of this Note and, therefore, stipulates that the
rule of construction  that  ambiguities are to be resolved  against the drafting
party shall not be applied in the interpretation of this Note to favor any party
against the other.

         5.9 Cost of Collection. If default is made in the payment of this Note,
the  Borrower  shall pay to Holder  reasonable  costs of  collection,  including
reasonable attorney's fees.


       [Balance of page intentionally left blank; signature page follows.]



                                       9






         IN WITNESS WHEREOF,  the Borrower has caused this Convertible Term Note
to be signed in its name effective as of this 11th day of June, 2004.


                                           MITEK SYSTEMS, INC.


                                           By:
                                              ----------------------------------
                                           Name:
                                                --------------------------------
                                           Title:
                                                 -------------------------------

WITNESS:


- -------------------------------



                                       10


                                    EXHIBIT A

                              NOTICE OF CONVERSION

 (To be executed by the Holder in order to convert all or part of the Note into
                                  Common Stock

[Name and Address of Holder]


The  Undersigned  hereby  converts  $_________  of the principal due on [specify
applicable  Repayment  Date]  under the  Convertible  Term Note  issued by MITEK
SYSTEMS, INC. dated June __, 2004 by delivery of Shares of Common Stock of MITEK
SYSTEMS,  INC. on and subject to the conditions set forth in Article III of such
Note.

1.       Date of Conversion         _______________________

2.       Shares To Be Delivered:    _______________________


                                           By:
                                              ----------------------------------
                                           Name:
                                                --------------------------------
                                           Title:
                                                 -------------------------------


                                    EXHIBIT B

                                CONVERSION NOTICE

   (To be executed by the Holder in order to convert all or part of a Monthly
                           Amount into Common Stock)

[Name and Address of Holder]


Holder  hereby  converts  $_________  of the  Monthly  Amount  due  on  [specify
applicable  Repayment  Date]  under the  Convertible  Term Note  issued by MITEK
SYSTEMS,  INC.  dated  _______,  200__ by delivery of Shares of Common  Stock of
MITEK SYSTEMS, INC. on and subject to the conditions set forth in Article III of
such Note.


1.       Fixed Conversion Price:    $_______________________

2.       Amount to be paid:         $_______________________



                                       11


3.       Shares To Be Delivered (2 divided by 1):  _____________________

4.       Cash payment to be made by Borrower :    $_____________________



Date: ____________                         LAURUS  MASTER FUND, LTD.

                                           By:
                                              ----------------------------------
                                           Name:
                                                --------------------------------
                                           Title:
                                                 -------------------------------



                                       1