<SEC-DOCUMENT>0001193125-16-768534.txt : 20161115
<SEC-HEADER>0001193125-16-768534.hdr.sgml : 20161115
<ACCEPTANCE-DATETIME>20161115104232
ACCESSION NUMBER:		0001193125-16-768534
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20161115
ITEM INFORMATION:		Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers: Compensatory Arrangements of Certain Officers
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20161115
DATE AS OF CHANGE:		20161115

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			VASCO DATA SECURITY INTERNATIONAL INC
		CENTRAL INDEX KEY:			0001044777
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373]
		IRS NUMBER:				364169320
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-24389
		FILM NUMBER:		161998221

	BUSINESS ADDRESS:	
		STREET 1:		1901 SOUTH MYERS ROAD
		STREET 2:		SUITE 210
		CITY:			OAKBROOK TERRACE
		STATE:			IL
		ZIP:			60181
		BUSINESS PHONE:		6309328844

	MAIL ADDRESS:	
		STREET 1:		1919 S HIGHLAND AVE
		STREET 2:		STE 118 C
		CITY:			LOMBARD
		STATE:			IL
		ZIP:			60148
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>d295449d8k.htm
<DESCRIPTION>FORM 8-K
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<TITLE>Form 8-K</TITLE>
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 <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
<P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="margin-top:4pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>SECURITIES AND EXCHANGE COMMISSION
</B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>WASHINGTON, D.C. 20549 </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>FORM 8-K
</B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>CURRENT REPORT </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>PURSUANT
TO SECTION 13 OR 15(d) </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>OF THE SECURITIES EXCHANGE ACT OF 1934 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Date of Report (Date of earliest event reported): November&nbsp;15, 2016 </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:24pt; font-family:Times New Roman" ALIGN="center"><B>VASCO Data Security International, Inc. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(Exact name of registrant as specified in charter) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top" ALIGN="center"><B>Delaware</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>000-24389</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>36-4169320</B></TD></TR>
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<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(State or other jurisdiction</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>of incorporation)</B></P></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Commission</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>File Number)</B></P></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(IRS Employer</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Identification No.)</B></P></TD></TR>
</TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>1901 South Meyers Road, Suite 210</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Oakbrook Terrace, Illinois</B></P></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="center"><B>60181</B></TD></TR>
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<TD VALIGN="top" ALIGN="center"><B>(Address of principal executive offices)</B></TD>
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<TD VALIGN="top" ALIGN="center"><B>(Zip Code)</B></TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Registrant&#146;s telephone number, including area code: (630)&nbsp;932-8844 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>N/A </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Former name or
former address, if changed since last report) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#9744;</TD>
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<TD ALIGN="left" VALIGN="top">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#9744;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) </TD></TR></TABLE> <P STYLE="font-size:10pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P>

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<TD WIDTH="12%" VALIGN="top" ALIGN="left"><B>Item&nbsp;5.02.</B></TD>
<TD ALIGN="left" VALIGN="top"><B>Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensation Arrangements of Certain Officers. </B></TD></TR></TABLE>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">On November&nbsp;15, 2016 (the &#147;Effective Date&#148;), VASCO Data Security International, Inc. (the &#147;Company&#148;) appointed Scott Clements
(&#147;Executive&#148;) as the Company&#146;s President and Chief Operating Officer. Executive and Company amended Executive&#146;s Employment Agreement, dated December&nbsp;1, 2015, with the Company (as amended, the &#147;Employment
Agreement&#148;) to reflect such appointment. Prior to his appointment as President and Chief Operating Officer, Executive was the Executive Vice President and Chief Strategy Officer of the Company. The initial term of Executive&#146;s employment
under the Employment Agreement continues until December&nbsp;1, 2017, with automatic renewals on each anniversary of such date for successive one-year terms, unless terminated by the other party at least six months prior to termination of the then
term. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Employment Agreement provides for an initial base salary of $365,000 per year, subject to adjustment in accordance with the Company&#146;s
normal practice for executive salary review from time to time. During the term of employment Executive will also participate in the Annual Bonus Plan (as defined in the Employment Agreement). During 2016 Executive was granted a target bonus under
the Annual Bonus Plan equal to 80% of his base salary. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">During the term of employment Executive will also participate in the Company&#146;s 2009 Equity
Incentive Plan (the &#147;Plan&#148;). On December&nbsp;1, 2015, Executive was awarded $600,000 of the Company&#146;s common stock under the Plan, valued as of market closing on the date of the grant, and vesting in equal semi-annual installments
over 4 years following such date. For 2016, Executive was granted under the Plan (a)&nbsp;a restricted stock grant for three hundred sixty five thousand dollars ($365,000) of the Company&#146;s common stock, valued as of market closing on the date
of grant, to be earned based upon the Company achieving performance targets for 2016 established by the Compensation Committee of the Board of Directors, and if earned, would vest 25% upon the Committee&#146;s determination that such performance
targets were achieved, and 25% on each of the subsequent anniversaries of the date of such grant (the &#147;2016 One Year Performance Grant&#148;) and (b)&nbsp;a restricted stock grant for three hundred sixty five thousand dollars ($365,000) of the
Company&#146;s common stock, valued as of market closing on the date of grant, which would be earned based upon the Company achieving three year cumulative performance targets for 2016, 2017, and 2018 established by the Committee, and if earned,
would vest 100% upon the Committee&#146;s determination that such performance target was achieved (&#147;2016 Three Year Performance Grant&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Executive will also be eligible to participate on substantially the same basis as the Company&#146;s other senior executive officers in any other employee
benefit plan offered by the Company. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Executive&#146;s employment may be terminated by the Company with or without Cause (as defined in the Employment
Agreement) by giving written notice to Executive designating an immediate or future termination date. If the Company terminates Executive&#146;s employment without Cause (as defined in the Employment Agreement), or Executive terminates his
employment for Good Reason (as defined in the Employment Agreement), the Company shall pay Executive his base salary and benefits through the termination date and executive shall be eligible to receive (i)&nbsp;6 months of Executive&#146;s then
current Base Salary, (ii)&nbsp;50% of his target bonus under the Annual Bonus Plan for the current year in which Executive&#146;s employment terminates, or if such target has not been established for such current year, the most recently established
target bonus under such plan, and (iii)&nbsp;awards payable, if any, under the Plan. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">If contemporaneous with or within 18 months after a Change in
Control (as defined in the Plan) (a)&nbsp;the Company terminates Executive&#146;s employment without Cause or (b)&nbsp;Executive terminates his employment for Good Reason, then, Executive will be eligible to receive (i)&nbsp;6 months of
Executive&#146;s then current Base Salary, (ii)&nbsp;50% of his target bonus under the Company&#146;s Annual Bonus Plan for the current year in which Executive&#146;s employment terminates, or if such target has not been established for such current
year, the most recently established target bonus under such plan, and (iii)&nbsp;awards payable, if any, under the Plan. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Employment Agreement provides that, during the term of his employment and for the 12-month period following
termination for any reason (the &#147;Restricted Period&#148;), Executive will not have an ownership interest in or become employed or engaged by, or otherwise participate in or render services to, any business or enterprise within North America,
Central America, South America, the Caribbean, Europe, the Middle East, Africa, India, the Australian continent and Asia (the &#147;Geographical Area&#148;) that engages in any data security business or any other business engaged in by the Company.
The Employment Agreement also provides that, during the Restricted Period, Executive shall not (i)&nbsp;solicit for employment, hire or engage, or attempt to solicit for employment, hire or engage, any person who is or was employed by the Company
within the six month period prior to the date of solicitation, hire or engagement, or (ii)&nbsp;otherwise interfere with the relationship between any such person and the Company. Further, the Employment Agreement prohibits Executive from inducing or
attempting to induce any customer, distributor, agent, licensor, licensee, contractor, vendor or other business relation that was doing business with the Company or any of its subsidiaries to reduce or cease doing business with the Company or any of
its subsidiaries or otherwise interfere with the relationship between the Company or any of its subsidiaries and such entity. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Executive is 54 years old.
Since December&nbsp;1, 2015, Executive has been the Executive Vice President and Chief Strategy Officer of the Company. Prior to joining the Company, he was employed by Tyco International for eleven years. He most recently served as the Corporate
Senior Vice President, Business Development of Tyco, where he focused on technology acquisitions. Executive previously served as President of Tyco Retail Solutions and also as Tyco&#146;s Chief Technology Officer. Executive earned his
bachelor&#146;s degree in chemical engineering and advanced process control from The Ohio State University, and holds an M.B.A. in finance and corporate strategy from the University of Michigan. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Executive will be succeeding Jan Valcke who has retired from the Company. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The foregoing description of the Employment Agreement is qualified in its entirety by reference to the Employment Agreement. </P>
<P STYLE="font-size:18pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="12%" VALIGN="top" ALIGN="left"><B>Item&nbsp;9.01</B></TD>
<TD ALIGN="left" VALIGN="top"><B>Financial Statements and Exhibits </B></TD></TR></TABLE> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">(d) Exhibits. The following Exhibits are furnished herewith: </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; width:23.50pt; font-size:8pt; font-family:Times New Roman" ALIGN="center">Exhibit<BR>No.</P></TD>
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<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; width:37.25pt; font-size:8pt; font-family:Times New Roman" ALIGN="center">Description</P></TD></TR>


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<TD VALIGN="top" NOWRAP>10.1</TD>
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<TD VALIGN="top">Employment Agreement, effective as of December 1, 2015, by and between VASCO Data Security International, Inc. and Scott Clements, and Amendment No. 1 to Employment Agreement, effective as of November 15, 2016.</TD></TR>
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<TD VALIGN="top" NOWRAP>10.2</TD>
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<TD VALIGN="top">Award Agreement for Restricted Shares, dated as of December 1, 2015, by and between VASCO Data Security International, Inc. and Scott Clements.</TD></TR>
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<TD VALIGN="top" NOWRAP>10.3</TD>
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<TD VALIGN="top">Award Agreement for Performance Shares, dated as of January&nbsp;4, 2016, by and between VASCO Data Security International, Inc. and Scott Clements,</TD></TR>
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<TD VALIGN="top" NOWRAP>99.1</TD>
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<TD VALIGN="top">Press Release dated November 15, 2016.</TD></TR>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>SIGNATURE </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top">Date: November&nbsp;15, 2016</TD>
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<TD VALIGN="bottom">VASCO Data Security International, Inc.</TD></TR>
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<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Mark S. Hoyt</P></TD></TR>
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<TD VALIGN="bottom">Mark S. Hoyt</TD></TR>
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<TD VALIGN="bottom">Chief Financial Officer</TD></TR>
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<TYPE>EX-10.1
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<FILENAME>d295449dex101.htm
<DESCRIPTION>EX-10.1
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right">Exhibit 10.1 </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><U>EMPLOYMENT AGREEMENT </U></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This <B>EMPLOYMENT AGREEMENT</B> (this &#147;<B>Agreement</B>&#148;) is made effective as of December&nbsp;1, 2015 (the &#147;<B>Effective
Date</B>&#148;), by and between VASCO Data Security International, Inc. (the &#147;<B>Company</B>&#148;), and Scott Clements (&#147;<B>Executive</B>&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">WHEREAS, the Company desires to employ Executive, and Executive desires to be employed by the Company, as the Company&#146;s Executive Vice
President and Chief Strategy Officer, on the terms set forth in this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">NOW, THEREFORE, in consideration of the mutual
undertakings of the parties hereto, the Company and Executive agree as follows: </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE I </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>EMPLOYMENT SERVICES </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>1.1 <U>Term of Employment</U></B>. The term of Executive&#146;s employment under this Agreement shall commence on the Effective Date and
continue until the second anniversary of such date (the &#147;<B>Initial Term</B>&#148;), which shall automatically renew on the second and each following anniversary of the Effective Date for successive one (1)&nbsp;year terms (each, a
&#147;<B>Successive Term</B>&#148;) (the Initial Term, together with all Successive Terms, if any, are collectively referred to herein as the &#147;<B>Employment Period</B>&#148;), unless either party provides the other party with written notice at
least six (6)&nbsp;months prior to the expiration of the Initial Term, or any Successive Term, of its or his intent not to renew the Initial Term, or any Successive Term, respectively. The Employment Period may be terminated earlier pursuant to the
terms of <U>Article III</U> below. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>1.2 <U>Position and Duties</U></B>. On the terms and subject to the conditions set forth in this
Agreement, commencing on the Effective Date and thereafter during the Employment Period, Executive shall hold the position of Executive Vice President and Chief Strategy Officer and shall report to the Chief Executive Officer. Executive shall
perform such duties and responsibilities as are consistent with Executive&#146;s position and as may be reasonably assigned to Executive by the Chief Executive Officer from time to time. Executive shall devote Executive&#146;s full business time,
attention, skill and energy to the business and affairs of the Company, and shall use Executive&#146;s reasonable best efforts to perform such responsibilities in a diligent, loyal, and businesslike manner so as to advance the best interests of the
Company. Executive shall act in conformity with the Company&#146;s Code of Conduct and Ethics (or similar successor document) as in effect from time to time (the &#147;<B>Code of Conduct</B>&#148;) and the Company&#146;s policies, and within the
limits, budgets and business plans set by the Company, and shall adhere to all rules and regulations in effect from time to time relating to the conduct of executives of the Company. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>1.3 <U>Other Activities</U></B>. Notwithstanding <U>Section&nbsp;1.2</U><B>,</B> Executive shall be permitted to devote a reasonable amount
of time and effort to professional, industry, civic and charitable organizations and managing personal investments; but only to the extent that such activities, individually or as a whole, do not materially interfere with the execution of
Executive&#146;s duties hereunder, or otherwise violate any provision of this Agreement. Executive shall not become </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">1 </P>


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involved in the management of any for profit corporation, partnership or other for profit entity, including serving on the board of directors (or similar governing body) of any such entity,
without the prior consent of the Company&#146;s Board of Directors (&#147;<B>Board</B>&#148;) and the Chief Executive Officer; provided, however, that this restriction shall not apply to any subsidiary of the Company. Executive will serve without
additional compensation as an officer and director of any of the Company&#146;s subsidiaries. Any compensation or other remuneration received from such service may be offset against the amounts due hereunder. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>1.4 <U>Location</U></B>. Subject to Executive complying with Swiss immigration laws and visa requirements, during the first twelve months
of the Employment Term Executive&#146;s place of business shall be at the Company&#146;s office in Zurich, Switzerland, and thereafter his place of business shall be the Company&#146;s headquarters in Oakbrook Terrace, Illinois; provided that
Executive may elect to move his principal place of business to the Company&#146;s headquarters in Oakbrook Terrace, Illinois earlier with the approval of the Chief Executive Officer. Pending issuance of necessary Swiss visas and work permits that
will enable him to work from the Company&#146;s Zurich, Switzerland offices Executive shall travel as needed to perform his services for the Company hereunder. If by February&nbsp;28, 2016 Executive has not obtained necessary Swiss visas and work
permits that will enable him to work from the Company&#146;s Zurich, Switzerland offices, Executive shall promptly relocate to the Chicago area at his expense, and his place of business shall be the Company&#146;s headquarters in Oakbrook Terrace,
Illinois. Executive&#146;s principal place of business shall not be relocated outside a 40 mile radius of such office without the written consent of Executive. Executive will travel as reasonably necessary to perform his duties under this Agreement,
which may include significant travel, including internationally. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE II </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>COMPENSATION </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>2.1
<U>Base Salary</U></B>. The Company shall pay Executive an annual base salary (&#147;<B>Base Salary</B>&#148;) of $365,000, payable in accordance with payroll practices in effect for senior executive officers of the Company generally. Base Salary
shall be subject to review in accordance with the Company&#146;s normal practice for executive salary review from time to time in effect, and may be increased, but will not be reduced without the prior written consent of Executive except for a
reduction that is commensurate with and part of a general salary reduction program applicable to all senior executives of the Company. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>2.2 <U>Annual Incentive Compensation</U></B>. During the Employment Period, Executive shall participate in the Company&#146;s Executive
Incentive Plan and any successor thereto (the &#147;<B>Annual Bonus Plan</B>&#148;) in accordance with the terms and conditions thereof and on the same basis as other senior executives of the Company. For the portion of the Employment Period
occurring in 2016, subject to and in accordance with the terms of the Annual Bonus Plan, Executive shall be provided a target bonus equal to 80% of his Base Salary (the &#147;<B>2016 Bonus</B>&#148;). For the portion of the Employment Period
occurring in 2015 Executive shall be entitled to a guaranteed <U>pro</U> <U>rata</U> bonus under the Annual Bonus Plan which is equal to twenty four thousand three hundred thirty three dollars ($24,333) (the &#147;<B>2015 Bonus</B>&#148;). </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">2 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>2.3 <U>Long-Term Incentive Compensation</U></B>. <B></B> </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) During the Employment Period, Executive shall participate in the Company&#146;s 2009 Equity Incentive Plan and any
successor thereto (the &#147;<B>Long-Term Incentive Plan</B>&#148;) in accordance with the terms and conditions thereof and on the same basis as other senior executives of the Company, subject to <U>Section&nbsp;2.3 (b)</U>&nbsp;below for 2016. In
connection with his commencing employment with the Company, on the Effective Date Executive is being awarded under the Long Term Incentive Plan a time vesting restricted stock grant (the &#147;<B>Initial Grant</B>&#148;) for six hundred thousand
dollars ($600,000) of the Company common stock, valued as of market closing on the date of grant, and vesting in equal semi-annual installments over 4 years from the Effective Date. The terms and conditions of the Initial Grant shall be governed by
the Long Term Incentive Plan and an award agreement determined by the Compensation Committee of the Board (&#147;<B>Committee</B>&#148;). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) For 2016, upon recommendation and approval of the Committee, Executive shall be entitled to receive under the Long Term
Incentive Plan (a)&nbsp;a restricted stock grant for three hundred sixty five thousand dollars ($365,000) of the Company&#146;s common stock, valued as of market closing on the date of grant, which would be earned based upon the Company achieving
performance targets for 2016 as determined by the Committee, and if earned, would vest 25% upon the Committee&#146;s determination that such performance targets were achieved, and 25% on each of the subsequent anniversaries of the date of such grant
(the &#147;<B>2016 One Year Performance Grant</B>&#148;) and (b)&nbsp;a restricted stock grant for three hundred sixty five thousand dollars ($365,000) of the Company&#146;s common stock, valued as of market closing on the date of grant, which would
be earned based upon the Company achieving three year cumulative performance targets for 2016, 2017, and 2018 as determined by the Committee, and if earned, would vest 100% upon the Committee&#146;s determination that such performance target was
achieved (&#147;<B>2016 Three Year Performance Grant</B>&#148;). The terms and conditions of the 2016 One Year performance Grant and 2016 Three Year Performance Grant shall be governed by the Long Term Incentive Plan and an award agreement
determined by the Committee consistent with corresponding grants provided to other senior executive officers of the Company for 2016. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>2.4 <U>Employee Benefit Plans</U></B>. Executive will be eligible to participate on substantially the same basis as the Company&#146;s
other senior executive officers in any other employee benefit plans offered by the Company including, without limitation, medical, dental, short-term and long-term disability, life insurance, pension and profit sharing (in each case, subject to the
eligibility requirements of such plans). The Company reserves the right to modify, suspend or discontinue any and all of its employee benefit plans, practices, policies and programs at any time without recourse by Executive, so long as the Company
takes such action generally with respect to other similarly situated senior executive officers. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>2.5 <U>Vacation</U></B>. Executive
will be entitled to vacation in accordance with the Company&#146;s vacation policy for senior executive officers, officers, but in no event less than four weeks per calendar year of paid vacation. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>2.6 <U>Business Expenses</U></B>. The Company will reimburse Executive for all reasonable and necessary business expenses incurred in the
performance of services with the Company, according to Company&#146;s policies and upon Executive&#146;s presentation of an itemized written statement and such verification as the Company may require. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">3 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>2.7 <U>Expat Allowance</U></B>. Through February&nbsp;28, 2016 and thereafter, if applicable,
for so long as Executive is working at the Company&#146;s office in Zurich, Switzerland, the Company shall (i)&nbsp;pay the Executive a gross monthly cash allowance of $14,091 for the reimbursement of certain living expenses incurred by Executive,
and (ii)&nbsp;reimburse Executive for the cost of two coach round trip air fares from the US to Zurich and back to the US for two dependents of Executive during each consecutive 12 months of the Employment Period that begins on the Effective Date
(i.e. 4 roundtrip tickets per year). </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE III </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>TERMINATION OF EMPLOYMENT </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.1 <U>Voluntary Resignation</U></B>. Executive may terminate his employment for any reason by giving the Company 90 days prior written
notice of a voluntary resignation date (&#147;<B>Resignation Date</B>&#148;). Upon receiving Executive&#146;s notice of intent to resign, the Company may require that Executive cease performing services for the Company at any time before the
Resignation Date, so long as the Company continues Executive&#146;s Base Salary, service for purposes of the Annual Bonus Plan and Long-Term Incentive Plan, and employee benefits under <U>Section&nbsp;2.4</U> through the Resignation Date. Except as
otherwise provided under law or the terms of the Annual Bonus Plan, the Long-Term Incentive Plan, or any other employee benefit plan in which Executive participates, Executive shall not be entitled to receive any compensation or benefits from the
Company after the Resignation Date. For the avoidance of doubt, any annual incentive bonus that has not been paid as of the Resignation Date will not be payable and is forfeited. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.2 <U>Termination By Company for Cause</U></B>. The Company may terminate Executive&#146;s employment for Cause (as defined below) by
giving written notice to Executive designating an immediate or future termination date. Such notice shall indicate the specific provisions of this Agreement relied upon as the basis of such termination. In the event of a termination for Cause, the
Company shall pay Executive his Base Salary and provide employee benefits under <U>Section&nbsp;2.4</U> through the termination date. Except as otherwise provided under law or the terms of the Annual Bonus Plan, the Long-Term Incentive Plan, or any
other employee benefit plan in which Executive participates, Executive shall not be entitled to receive any compensation or benefits from the Company after the termination date. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">For purposes of this Agreement, &#147;<B>Cause</B>&#148; means: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) Executive materially breaches Executive&#146;s obligations under this Agreement, the Company&#146;s Code of Conduct and
Ethics (or any successor thereto) or an established policy of the Company; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(ii) Executive engages in conduct prohibited by
law (other than minor violations), commits an act of dishonesty, fraud, or serious or willful misconduct in connection with his job duties, or engages in unethical or immoral conduct that, in the reasonable judgment of the Committee, could injure
the integrity, character or reputation of Company; </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">4 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iii) Executive fails or refuses to perform, or habitually neglects,
Executive&#146;s duties and responsibilities hereunder (other than on account of Disability (as defined below), and continues such failure, refusal or neglect after having been given written notice by the Company that specifies what duties Executive
failed to perform and an opportunity to cure of 30 days; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iv) Use or disclosure by Executive of confidential information
or trade secrets other than in the furtherance of the Company&#146;s (or its subsidiaries&#146;) business interests, or other violation of a fiduciary duty to the Company (including, without limitation, entering into any transaction or contractual
relationship causing diversion of business opportunity from the Company (other than with the prior written consent of the Board)); or </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(v) Executive fails to reasonably cooperate with any audit or investigation involving the Company or its business practices
after having been given written notice by the Company that specifies Executive&#146;s failure to cooperate and an opportunity to cure of 10 days. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.3 <U>Termination By Company Without Cause or Termination by Executive for Good Reason</U></B>. The Company may terminate Executive&#146;s
employment without Cause at any time during the Employment Period by giving written notice to Executive designating an immediate or future termination date. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Executive may resign from employment during the Employment Period due to: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) a failure to provide the compensation and benefits required by this Agreement, including a reduction in Executive&#146;s
Base Salary below the Base Salary in effect during the immediately preceding year, unless such reduction is commensurate with and part of a general salary reduction program applicable to all senior executives of the Company or agreed to in writing
by Executive; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(ii) a failure to appoint or elect Executive as Executive Vice President and Chief Strategy Officer of the
Company, in accordance with <U>Section&nbsp;1.2</U> hereof; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iii) any material diminution of Executive&#146;s authority,
duties or responsibilities; or </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iv) the Company requiring Executive to be based at any office or location other than the
office provided for in <U>Section&nbsp;1.4</U> hereof; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">(each of which shall constitute a &#147;<B>Company Breach</B>&#148; or &#147;<B>Good
Reason</B>&#148;) and such resignation shall be treated as a termination by Executive for Good Reason; <I>provided</I> that, (a)&nbsp;Executive&#146;s voluntary resignation occurs within 90 days following the initial occurrence of a Company Breach,
(b)&nbsp;Executive provided written notice describing such Company Breach in reasonable </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">5 </P>


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detail to the Committee within 30 days of the initial occurrence of such Company Breach, and (c)&nbsp;the Company failed to cure such Company Breach within 30 days of receipt of such written
notice from Executive; <I>and provided</I>,<I> further</I>, that in the case of <U>subsections (ii)</U>&nbsp;and <U>(iii)</U>, an act or omission shall not constitute a Company Breach if Executive has incurred a Disability (as defined below). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The election by Executive to not renew the Initial Term or any Successive Terms pursuant to <U>Section&nbsp;1.1</U> shall not be a termination
for Good Reason and shall not entitle Executive to Severance Pay. However, the election by the Company to not renew the Initial Term or any Successive Terms pursuant to <U>Section&nbsp;1.1</U> shall be deemed to be a termination without Cause
effective as of the termination of the Initial Term or Successive Term as applicable, and shall entitle Executive to Severance Pay as hereinafter provided. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In the event of a termination by the Company without Cause or a termination by Executive for Good Reason, the Company shall pay Executive his
Base Salary and provide employee benefits under <U>Section&nbsp;2.4</U> through the termination date. In addition, subject to the requirements set forth in <U>Section&nbsp;3.7</U>, <U>Section&nbsp;3.8</U>, and <U>Section&nbsp;3.9</U>, the Company
will provide the following compensation and benefits to Executive (collectively, the &#147;<B>Severance Pay</B>&#148;): </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:13%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(A) an amount equal to six (6)&nbsp;months of Executive&#146;s then current Base Salary, plus an amount equal to 50% of his
target bonus under the Annual Bonus Plan for the current year in which Executive&#146;s employment terminates, or if such target has not been established for such current year, then the most recently established target bonus under the Annual Bonus
Plan, each less applicable withholdings, payable in equal installments on each regularly scheduled payroll pay date during the six (6)&nbsp;month period that begins on the first day immediately after the Release Effective Date (as defined in
<U>Section&nbsp;3.7</U>); and </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:13%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(B) Awards, if any, under the Long Term Incentive Plan shall be paid in accordance with the
terms and conditions of the Long-Term Incentive Plan and the applicable awards. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Except as otherwise provided under law, or the terms of
the Annual Bonus Plan, the Long-Term Incentive Plan, or any other employee benefit plan in which Executive participates, Executive shall not be entitled to receive any additional compensation or benefits from the Company after the termination date.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.4 <U>Death</U></B>. The Employment Period shall terminate automatically upon Executive&#146;s death. In the event of
Executive&#146;s death during the Employment Period, the Company shall pay Executive&#146;s Base Salary and provide employee benefits under <U>Section&nbsp;2.4</U> through the termination date. Except as otherwise provided under law or the terms of
the Annual Bonus Plan, the Long-Term Incentive Plan, or any other employee benefit plan in which Executive participates, no other compensation or benefits from the Company shall be payable after the termination date. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">6 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.5 <U>Disability</U></B>. &#147;<B>Disability</B>&#148; means Executive being unable to
perform his duties to the Company as Executive Vice President and Chief Strategy Officer as provided in this Agreement for a period of at least 180 continuous days as a result of a mental or physical condition. The Company may terminate
Executive&#146;s employment for Disability during the Employment Period by giving written notice to Executive designating a termination date that is at least 30 days after the date of the notice of termination, <I>provided</I> that Executive does
not return to work on a substantially full-time basis within 30 days after notice of termination on account of Disability is provided to Executive. A return to work of less than 30 continuous days on a substantially
<FONT STYLE="white-space:nowrap">full-time</FONT> basis shall not interrupt a continuous period of Disability. In the event of termination of the Employment Period on account of Executive&#146;s Disability, the Company shall pay Executive&#146;s
Base Salary and provide employee benefits under <U>Section&nbsp;2.4</U> through the termination date. Except as otherwise provided under law or the terms of the Annual Bonus Plan, the Long-Term Incentive Plan, or any other employee benefit plan in
which Executive participates, no other compensation or benefits from the Company shall be payable after the termination date. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.6
<U>Change in Control</U></B>. &#147;<B>Change in Control</B>&#148; has the meaning assigned to such term in the Long Term Incentive Plan as in effect from time to time. Notwithstanding anything in this Agreement to contrary, a Change in Control will
have occurred only if such change in ownership constitutes a change in control under Section&nbsp;409A of the Internal Revenue Code of 1986, as amended (the &#147;<B>Code</B>&#148;), and the regulations and other guidance in effect thereunder
(&#147;<B>Section 409A</B>&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If contemporaneous with or within eighteen (18)&nbsp;months after a Change in Control that occurred
during the Employment Period (a)&nbsp;the Company terminates Executive&#146;s employment without Cause or (b)&nbsp;Executive terminates his employment for Good Reason, then, provided Executive complies with the requirements set forth in
<U>Section&nbsp;3.7</U>, <U>Section&nbsp;3.8</U>, and <U>Section&nbsp;3.9</U>, Executive will be eligible to receive Severance Pay described in <U>Section&nbsp;3.3</U> (collectively, the &#147;<B>Change in Control Payments</B>&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Change in Control Payment which is a cash payment (and not securities) will be made in a lump sum cash payment as soon as practicable, but
in no event more than ten (10)&nbsp;days after Release Effective Date. Except as otherwise provided under law or the terms of any other employee benefit plan in which Executive participates, Executive shall not be entitled to receive any additional
compensation or benefits from the Company after the termination date. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.7 <U>Execution of Separation Agreement</U></B>. As a condition
to receiving Severance Pay or Change in Control Payments, Executive must execute and return to the Company, and not revoke any part of, a general release and waiver of claims against the Company and its officers, directors, stockholders, employees
and affiliates with respect to Executive&#146;s employment (including, without limitation, a release of claims under the Age Discrimination in Employment Act (the &#147;<B>ADEA Release</B>&#148;)), and other customary terms, in a form and substance
reasonably acceptable to the Company (the &#147;<B>Release</B>&#148;). Executive must deliver the executed Release within the minimum time period required by law or, if none, within twenty-one (21)&nbsp;days after Executive receives the Release from
the Company, which shall not be more than fifteen (15)&nbsp;days after Executive&#146;s termination of Employment. The Release will become effective on the date the revocation period of the ADEA Release expires without Executive revoking the ADEA
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">7 </P>


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Release (the &#147;<B>Release Effective Date</B>&#148;). Any obligation of the Company to provide the Severance Pay shall cease: (i)&nbsp;if Executive materially breached or breaches his
contractual obligations to the Company, including those set forth in <U>Article IV</U> or <U>Article V</U> herein, or in the Release or (ii)&nbsp;if, after Executive&#146;s termination, the Company discovers facts and circumstances that would have
justified a termination for Cause during the Employment Period. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.8 <U>Timing of Payments; Section 409A</U></B>. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) Notwithstanding any other provision of this Agreement, in the event of a payment to be made, or a benefit to be provided,
pursuant to this Agreement based upon Executive&#146;s &#147;separation from service&#148; (as defined below) for a reason other than death at a time when Executive is a Specified Employee (as defined below) and such payment or provision of such
benefit is not exempt or otherwise permitted under Section&nbsp;409A without the imposition of any Section&nbsp;409A Penalty (as defined below), such payment shall not be made, and such benefit shall not be provided, before the earlier of the date
which is the first day of the seventh month after Executive&#146;s separation from service or 30 days after Executive&#146;s death. All payments or benefits delayed pursuant to this <U>Section&nbsp;3.8</U> shall be aggregated into one lump sum
payment to be made as of the Company&#146;s first business day following the first day of the seventh month after Executive&#146;s separation from service (or if earlier, as of 30 days after Executive&#146;s death). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) For purposes of this Agreement: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) &#147;<B>Separation from service</B>&#148; has the meaning provided under Code&nbsp;Section 409A and Treas. Reg.
1.409A-1(h); </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(ii) &#147;<B>Specified Employee</B>&#148; has the meaning given that term in Code&nbsp;Section 409A and
Treas. Reg. 1.409A-1(c)(i) as determined in accordance with the Company&#146;s policy for determining Specified Employees; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iii) &#147;<B>Section 409A Penalty</B>&#148; means any increase in tax or any other penalty pursuant to Section&nbsp;409A; and
</P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iv) All payments of &#147;deferred compensation,&#148; as defined in Code&nbsp;Section 409A, due to Executive&#146;s
&#147;termination of employment&#148; shall be payable upon Executive&#146;s separation from service. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) This Agreement
is intended not to result in the imposition of any Section&nbsp;409A Penalty and shall be administered, interpreted and construed in a manner consistent with such intent. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(d) Executive and the Company agree to cooperate to amend this Agreement from time to time as appropriate to avoid the
imposition of any Section&nbsp;409A Penalty. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(e) In no event shall the Company be required to provide a tax gross-up
payment to Executive with respect to any Section&nbsp;409A Penalty. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(f) Notwithstanding any provision of this Agreement to
the contrary, this Agreement is intended to be exempt from or, in the alternative, comply with Section&nbsp;409A and the interpretive guidance in effect thereunder, including the exceptions for short-term deferrals, separation pay arrangements,
reimbursements, and in-kind distributions. The Agreement shall be construed and interpreted in accordance with such intent. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">8 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.9 <U>Excess Parachute Payments; No Excise Tax Gross-Up</U></B>. Notwithstanding any
provision of this Agreement to the contrary, if it is determined by the Company&#146;s independent auditors that any amount or benefit to be paid or provided under this Agreement or otherwise, whether or not in connection with a Change in Control,
would be an &#147;<B>Excess Parachute Payment</B>&#148; within the meaning of Code Section&nbsp;280G but for the application of this sentence, then the payments and benefits to be paid or provided under this Agreement will be reduced to the minimum
extent necessary (but in no event to less than zero) so that no portion of any such payment or benefit, as so reduced, constitutes an Excess Parachute Payment; <I>provided</I>, <I>however</I>, that the foregoing reduction will be made only if and to
the extent that such reduction would result in an increase in the aggregate payment and benefits to be provided, determined on an after-tax basis (taking into account the excise tax imposed pursuant to Code Section&nbsp;4999, any tax imposed by any
comparable provision of state law, and any applicable federal, state and local income and employment taxes). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The fact that
Executive&#146;s right to payments or benefits may be reduced by reason of the limitations contained in this <U>Section&nbsp;3.9</U> will not of itself limit or otherwise affect any other rights of Executive other than pursuant to this Agreement. In
the event that any payment or benefit intended to be provided under this Agreement or otherwise is required to be reduced pursuant to this <U>Section&nbsp;3.9</U>, the Company will effect such reduction by reducing the lump sum cash payment related
to Base Salary (a &#147;<B>Reduction</B>&#148;). In the event that, after such Reduction any payment or benefit intended to be provided under this Agreement or otherwise is still required to be reduced pursuant to this <U>Section&nbsp;3.9</U>, the
Company will effect such reduction by reducing other consideration due to Executive. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>3.10 <U>Removal from any Boards and
Positions</U></B>. If Executive&#146;s employment is terminated for any reason under this Agreement, this Agreement will constitute his automatic resignation from (i)&nbsp;if a member, the board of directors of any subsidiary of the Company or any
other board to which he has been appointed or nominated by or on behalf of the Company, (ii)&nbsp;any position with the Company or any subsidiary of the Company, including, but not limited to, as an officer of the Company or any of its subsidiaries,
and (iii)&nbsp;any fiduciary positions with respect to the Company&#146;s benefit plans. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE IV </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>EXCLUSIVITY OF SERVICES AND RESTRICTIVE COVENANTS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>4.1 <U>Confidential Information</U></B>. Executive acknowledges and agrees that the Confidential Information (as defined below) of the
Company and its subsidiaries and any other entity related to the Company (each, a &#147;<B>VASCO Entity</B>&#148;) that he obtained during the course of his employment by the Company is the property of the Company or such other VASCO Entity.
Executive will never, directly or indirectly, disclose, publish or use any Confidential Information </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">9 </P>


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of which Executive has become aware, whether or not such information was developed by him. All duties and obligations set forth in this Agreement regarding Confidential Information shall be in
addition to those which exist under the Illinois Trade Secrets Act and at common law. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">As used in this Agreement, &#147;<B>Confidential
Information</B>&#148; means information that is not generally known to the public and that was or is used, developed or obtained by the Company or any other VASCO Entity, in connection with its businesses, including but not limited to: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) products or services, unannounced products or services, product or service development information (or other proprietary
product or service information); </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(ii) fees, costs, bids and pricing structures and quotations or proposals given to
agents, distributors, vendors, contractors, licensors, licensees, customers, or prospective agents, distributors, vendors, contractors, licensors, licensees or customers, or received from any such person or entity; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iii) accounting or financial records; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iv) strategic business plans; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(v) information system applications or strategies; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(vi) customer and vendor lists and employee lists and directories; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(vii) marketing plans, bidding strategies and processes, and negotiation strategies, whether past, current, or future; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(viii) accounting and business methods; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(ix) legal advice and/or attorney work product; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(x) trade secrets and other proprietary information; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(xi) information, analysis or strategies regarding acquisitions, mergers, other business combinations, divestitures,
recapitalizations, or new ventures; and </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(xii) nonpublic information that was acquired by Executive concerning the
requirements and specifications of the Company&#146;s or any other VASCO Entity&#146;s agents, distributors, vendors, contractors, licensors, licensees, customers, or potential customers. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Notwithstanding anything to the contrary, Confidential Information does not include any information that: (a)&nbsp;is publicly disclosed by
law or pursuant to, and to the extent required by, an order of a court of competent jurisdiction or governmental agency; (b)&nbsp;becomes publicly available through no fault of Executive; or (c)&nbsp;has been published in a form generally available
to the public before Executive proposes to disclose, publish, or use such information. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">10 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>4.2 <U>Noncompetition</U></B>. During the Employment Period and for the 12-month period
following the termination of the Employment Period for any reason (the &#147;<B>Restricted Period</B>&#148;), Executive will not, on behalf of himself or any other entity, have an ownership interest in or become employed or engaged by, or otherwise
participate in or render services to, any business or enterprise (including, without limitation, any division, group or franchise of a larger organization) within the Geographical Area (as defined below) that engages in any data security business or
any other business engaged in by the Company; <I>provided</I>, <I>however</I>, that the this restriction shall not prohibit Executive from passive beneficial ownership of less than two&nbsp;percent of any class of securities of a publicly-held
corporation whose stock is traded on a U.S. national securities exchange or traded in the over-the-counter market. For the purpose of this provision, &#147;<B>Geographical Area</B>&#148; means North America, Central America, South America, the
Caribbean, Europe, the Middle East, Africa, India, the Australian continent and Asia. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>4.3 <U>Non-Solicitation</U></B>. During the
Restricted Period, Executive shall not (other than in furtherance of Executive&#146;s legitimate job duties on behalf of Company), directly or indirectly, on Executive&#146;s own behalf or for any other person or entity: (i)&nbsp;solicit for
employment, hire or engage, or attempt to solicit for employment, hire or engage, any person who is or was employed by the Company within the six month period prior to the date of solicitation, hire or engagement, or (ii)&nbsp;otherwise interfere
with the relationship between any such person and the Company. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>4.4 <U>Non-Interference with Business Relationships</U></B>. During the
Restricted Period, Executive shall not (other than in furtherance of Executive&#146;s legitimate job duties on behalf of the Company), directly or indirectly, on Executive&#146;s own behalf or for any other person or entity: (i)&nbsp;induce or
attempt to induce any customer, distributor, agent, licensor, licensee, contractor, vendor or other business relation that was doing business with any VASCO Entity during the one-year period prior to the inducement or attempted inducement to reduce
or cease doing business with the Company or any VASCO Entity, or otherwise interfere with the relationship between such person (or entity) and any VASCO Entity; (ii)&nbsp;induce or attempt to induce any prospective customer, distributor, agent,
licensor, licensee, contractor, vendor or other prospective business relation located in the Geographical Area with which any VASCO Entity has had communications during the six-month period prior to the inducement or attempted inducement regarding
doing business with the Company or any other VASCO Entity to not do business or to do reduced business with the Company or any other VASCO Entity, or otherwise interfere with the relationship between such person (or entity) and any VASCO Entity.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>4.5 <U>Equitable Modification</U></B>. If any court of competent jurisdiction shall deem any provision in this <U>Article IV</U> too
restrictive, the other provisions shall stand, and the court shall modify the unduly restrictive provision to the point of greatest restriction permissible by law. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>4.6 <U>Remedies</U></B>. Executive acknowledges that the agreements and covenants contained in this <U>Article IV</U> are essential to
protect the Company and its business and are a condition precedent to entering into this Agreement. Should Executive breach any covenants in this <U>Article IV</U>, then among other remedies, the duration of the covenant shall be extended by the
period of any such breach. Executive agrees that irreparable harm would result from Executive&#146;s breach or threat to breach any provision of this <U>Article IV</U>, and that monetary damages alone would not provide adequate relief to the Company
for the harm incurred. Executive agrees that in addition to money damages, the Company shall be entitled to seek and obtain temporary, </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">11 </P>


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preliminary and permanent injunctive relief restraining Executive from committing or continuing any breach without being required to post a bond. Without limiting the foregoing, upon a breach by
Executive of any provision of this <U>Article IV</U>, any outstanding Severance Pay shall cease and be forfeited, and Executive shall immediately reimburse the Company for any Severance Pay previously paid. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE V </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>POST-TERMINATION OBLIGATIONS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>5.1 <U>Return of Company Materials</U></B>. No later than three business days following the termination of Executive&#146;s employment for
any reason, Executive shall return to the Company all company property that is then in Executive&#146;s possession, custody or control, including, without limitation, all keys, access cards, credit cards, computer hardware and software, documents,
records, policies, marketing information, design information, specifications and plans, data base information and lists, and any other property or information that Executive has or had relating to the Company (whether those materials are in paper or
computer-stored form), and including but not limited to any documents containing, summarizing, or describing any Confidential Information. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>5.2 <U>Executive Assistance</U></B>. During Executive&#146;s employment with the Company and for a period of 3 years after the termination
of such employment, Executive shall, upon reasonable notice, furnish the Company with such information as may be in Executive&#146;s possession or control, and cooperate with the Company in any reasonable manner that the Company may request,
including without limitation conferring with the Company with regard to any litigation, claim, or other dispute in which the Company is or may become a party. The Company shall reimburse Executive for all reasonable out-of-pocket expenses incurred
by Executive in fulfilling Executive&#146;s obligations under this <U>Section&nbsp;5.2</U>. The Company will make any such reimbursement within 30 days of the date Executive provides the Company with documentary evidence of such expense consistent
with the policies of the Company. The Company will also pay Executive a reasonable fee per hour for his assistance during the two years commencing on the first anniversary of termination of his employment with the Company. Notwithstanding anything
to the contrary, any such reimbursement shall be administered so as to comply with Treasury Regulation Section&nbsp;1.409A-3(i)(1)(iv). </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">12 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE VI </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>MISCELLANEOUS </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.1
<U>Notices</U></B>. Any notices, consents or other communications required or permitted to be sent or given hereunder shall be in writing and shall be deemed properly served if (a)&nbsp;delivered personally, in which case the date of such notice
shall be the date of delivery; (b)&nbsp;delivered prepaid to a nationally recognized overnight courier service, in which case the date of delivery shall be the next business day; or (c)&nbsp;sent by facsimile transmission (with a copy sent by
first-class mail), in which case the date of delivery shall be the date of transmission, or if after 5:00 P.M., the next business day. If not personally delivered, notice shall be sent using the addresses set forth below: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If to Executive, to the address listed on the signature page or the last address on file in the records of the Company. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">If to the Company: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">VASCO Data Security International, Inc.
</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">1901 South Meyers Road </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Suite 210 </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Oakbrook Terrace, IL 60181-5206 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Attention: Chief Executive
Officer </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Telecopy: (630)&nbsp;932-8852 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">with a copy to: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Katten Muchin Rosenman LLP </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">525 West Monroe St. </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Chicago, IL 60661 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Attention Matthew Brown </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Telecopy: (312)&nbsp;902-1061 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">or such other address as may
hereafter be specified by notice given by either party to the other party. Executive shall promptly notify the Company of any change in his address set forth on the signature page. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.2 <U>Withholding</U></B>. The Company may withhold from any payment that it is required to make under this Agreement amounts sufficient
to satisfy applicable withholding requirements under any federal, state or local law, as well as any other amounts due and owing to the Company from Executive. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.3 <U>Successors and Assigns</U></B>. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and assigns; <I>provided</I> that Executive may not assign any of his rights or obligations under this Agreement without the Company&#146;s prior written consent. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.4 <U>Nonalienation of Benefits</U></B>. Benefits payable under this Agreement shall not be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution or levy of any kind, either voluntary or involuntary, prior to actually being received by Executive, and any such attempt to dispose of any right to benefits
payable hereunder shall be void. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.5 <U>Amendment; Waiver</U></B>. No failure or delay by the Company or Executive in enforcing or
exercising any right or remedy hereunder will operate as a waiver thereof. No modification, amendment or waiver of this Agreement or consent to any departure by Executive from any of the terms or conditions thereof, will be effective unless in
writing and signed by the Chairman of the Committee. Any such waiver or consent will be effective only in the specific instance and for the purpose for which given. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">13 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.6 <U>Severability; Survivability</U></B>. If any term or provision of this Agreement shall
be held to be invalid or unenforceable, the remaining terms and provisions hereof shall not be affected thereby and shall be enforced to the fullest extent permitted under law. Executive&#146;s obligations in <U>Articles IV</U> and <U>V</U> shall
survive and continue in full force notwithstanding the termination of this Agreement or Executive&#146;s employment for any reason. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.7 <U>Execution in Counterparts</U></B>. This Agreement may be executed in one or more counterparts, each of which shall be considered an
original instrument, but all of which shall be considered one and the same agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.8 <U>Governing Law; Consent to Jurisdiction;
Waiver of Jury</U></B>. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Illinois, without regard to its conflict of law principles. For the purposes of any suit, action, or other proceeding
arising out of this Agreement or with respect to Executive&#146;s employment hereunder, the parties: (i)&nbsp;agree to submit to the exclusive jurisdiction of the federal courts located in the Northern District of Illinois or state courts located in
DuPage County, Illinois; (ii)&nbsp;waive any objection to personal jurisdiction or venue in such jurisdiction, and agree not to plead or claim forum non conveniens; and (iii)&nbsp;waive their respective rights to a jury trial of any claims and
causes of action, and agree to have any matter heard and decided solely by the court. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.9 <U>Construction</U></B>. The language used
in this Agreement will be deemed to be the language chosen by Executive and the Company to express their mutual intent, and no rule of strict construction will be applied against Executive or the Company. The heading in this Agreement are for
convenience of reference only and will not limit or otherwise affect the meaning of the provision. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>6.10 <U>Entire Agreement;
Amendments</U></B>. This Agreement contains the entire understanding of the parties hereto with regard to the subject matter contained herein, and supersedes all prior agreements, understandings or letters of intent with regard to the subject matter
contained herein between the parties hereto. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by each of the parties hereto. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>IN WITNESS WHEREOF</B>, each of the parties hereto has duly executed this Employment Agreement. </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="3"><B>VASCO DATA SECURITY INTERNATIONAL, INC.</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Date: December 1, 2015</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ T. Kendall Hunt</P></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">Name:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">T. Kendall Hunt</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">Title:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">CEO</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="3"><B>SCOTT CLEMENTS</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Date: December 1, 2015</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Scott Clements</P></TD></TR>
</TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">14 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><U>AMENDMENT NO.1 TO EMPLOYMENT AGREEMENT </U></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This <B>AMENDMENT NO.1 TO EMPLOYMENT AGREEMENT</B> (this &#147;<B>Amendment</B>&#148;) is made effective as of November&nbsp;15, 2016 (the
&#147;<B>Effective Date</B>&#148;), by and between VASCO Data Security International, Inc. (the &#147;<B>Company</B>&#148;), and Scott Clements (&#147;<B>Executive</B>&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">WHEREAS, the Company currently employs Executive as the Company&#146;s Executive Vice President and Chief Strategy Officer, and the parties
mutually agree to change Executive&#146;s position to President and Chief Operating Officer. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">NOW, THEREFORE, in consideration of the
mutual undertakings of the parties hereto, the Company and Executive agree as follows: </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">1. <B><U>Position and
Duties</U></B>. On the terms and subject to the conditions set forth in the Employment Agreement, commencing on the Effective Date and thereafter during the Employment Period, Executive shall hold the position of President and Chief Operating
Officer and shall report to the Chief Executive Officer. Executive shall perform such duties and responsibilities as are consistent with Executive&#146;s position and as may be reasonably assigned to Executive by the Chief Executive Officer from
time to time. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">2. <B><U>References</U></B>. References in the Employment Agreement to position and title for Executive
shall now refer to the new position of President and Chief Operating Officer. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">3. <B><U>Effect</U></B>. The remaining
provisions of the Employment Agreement not modified as set forth above shall remain in full force and effect. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>IN WITNESS WHEREOF</B>,
each of the parties hereto has duly executed this Amendment. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="3"><B>VASCO DATA SECURITY INTERNATIONAL, INC.</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Date: November 15, 2016</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ T. Kendall Hunt</P></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">Name:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">T. Kendall Hunt</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">Title:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">CEO</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="3"><B>SCOTT CLEMENTS</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Date: November 15, 2016</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Scott Clements</P></TD></TR>
</TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">15 </P>

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<TYPE>EX-10.2
<SEQUENCE>3
<FILENAME>d295449dex102.htm
<DESCRIPTION>EX-10.2
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 10.2 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>AWARD AGREEMENT FOR RESTRICTED SHARES </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>UNDER THE </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>VASCO DATA
SECURITY INTERNATIONAL, INC. </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>2009 EQUITY INCENTIVE PLAN </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>THIS AWARD AGREEMENT FOR RESTRICTED SHARES</B> (this &#147;<B>Agreement</B>&#148;) is made as of December&nbsp;1, 2015 (the
&#147;<B>Effective Date</B>&#148;), between VASCO DATA SECURITY INTERNATIONAL, INC. (the &#147;<B>Company</B>&#148;) and Scott Clements (the &#147;<B>Grantee</B>&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>WHEREAS</B>, the Company maintains the VASCO Data Security International, Inc. 2009 Equity Incentive Plan (as amended, the
&#147;<B>Plan</B>&#148;) for the benefit of its employees, directors, consultants, and other individuals who provide services to the Company; and </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>WHEREAS</B>, to induce Grantee to become an employee of the Company, compensate the Grantee for his service to the Company and to further
align the Grantee&#146;s personal financial interests with those of the Company&#146;s shareholders, the Company wishes to award the Grantee a number of shares of Common Stock (as defined below), subject to the restrictions and on the terms and
conditions contained in the Plan and this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>NOW, THEREFORE</B>, in consideration of these premises and the agreements set
forth herein, the parties, intending to be legally bound hereby, agree as follows: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>1. <U>Grant of Restricted Shares</U></B>. The Company hereby grants
to the Grantee an award of 31,250 shares (the &#147;<B>Awarded Shares</B>&#148;) of the Company&#146;s common stock, par value of $0.001 per share (the &#147;<B>Common Stock</B>&#148;), subject to the terms and conditions set forth in this Agreement
and in the Plan. The terms of the Plan are hereby incorporated into this Agreement by this reference, as though fully set forth herein. Capitalized terms used but not defined in this Agreement have the meanings set forth in the Plan. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>2. <U>Vesting of Awarded Shares</U></B>. Subject to <U>Section&nbsp;11</U>, the Awarded Shares are subject to forfeiture to the Company until they become
vested in accordance with this <U>Section&nbsp;2</U>. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(a) Subject to <U>Section&nbsp;11</U>, Awarded Shares will become vested in
accordance with the following schedule, provided that on each vesting date, the Grantee has, from the date hereof, continuously provided services to the Company or a subsidiary: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(i) 12.5% of the Awarded Shares will vest on the six month anniversary date of the Effective Date; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(ii) An additional 12.5% of the Awarded Shares will vest on the first annual anniversary date of the Effective Date; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(iii) An additional 12.5% of the Awarded Shares will vest on the eighteen month anniversary date of the Effective Date; </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(iv) An additional 12.5% of the Awarded Shares will vest on the second annual anniversary date of
the Effective Date; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(v) An additional 12.5% of the Awarded Shares will vest on the thirty month anniversary date of the Effective Date;
</P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(vi) An additional 12.5% of the Awarded Shares will vest on the third annual anniversary date of the Effective Date; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(vii) An additional 12.5% of the Awarded Shares will vest on the forty-second month anniversary date of the Effective Date; and </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(viii) The final 12.5% of the Awarded Shares will vest on the fourth annual anniversary date of the Effective Date. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(b) Upon cessation of the Grantee&#146;s service with the Company for any reason or for no reason (and whether such cessation is initiated by
the Company, the Grantee or otherwise): (i)&nbsp;any Awarded Shares that have not, prior to such cessation, become vested will immediately and automatically, without any action on the part of the Company, be forfeited, and (ii)&nbsp;the Grantee
shall have no further rights with respect to those Awarded Shares. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(c) Solely for purposes of this Agreement, service with the Company
shall be deemed to include service with any subsidiary of the Company (for only so long as such entity remains a subsidiary). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>3. <U>Escrow of
Shares</U></B>. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(a) Certificates evidencing the Awarded Shares issued under this Agreement shall be held in escrow by the Secretary of the
Company or his or her designee (the &#147;<B>Escrow Holder</B>&#148;) (or, if the Awarded Shares are not certificated, shall be entered in the stock record books of the Company as held in escrow by the Escrow Holder) until such Awarded Shares are
vested in accordance with <U>Section&nbsp;2</U>, at which time, the Escrow Holder shall deliver such certificates representing the Awarded Shares to the Grantee (or, if the Awarded Shares are not certificated, the Awarded Shares shall be entered in
the stock record books of the Company as held and owned by the Grantee); <U>provided</U>, <U>however</U>, that no certificates for Awarded Shares will be delivered to the Grantee (or, if the Awarded Shares are not certificated, no transfer of the
Awarded Shares will be entered in the stock record books of the Company) until appropriate arrangements have been made with the Company for the withholding or payment of any taxes that may be due with respect to such Awarded Shares. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(b) If any of the Awarded Shares are forfeited by the Grantee under <U>Section&nbsp;2</U>, upon request by the Company, the Escrow Holder will
deliver any stock certificate(s) </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">2 </P>


<p Style='page-break-before:always'>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
evidencing those Awarded Shares to the Company (or, if the Awarded Shares are not certificated, such forfeiture will be entered in the stock record books of the Company), and the Company will
then have the right to retain and transfer those Awarded Shares to its own name free and clear of any rights of the Grantee under this Agreement or otherwise. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(c) The Escrow Holder is hereby directed to permit transfer of the Awarded Shares only in accordance with this Agreement or in accordance with
instructions signed by both parties hereto. In the event further instructions are reasonably desired by the Escrow Holder, he or she will be entitled to conclusively rely upon directions executed by a majority of the members of the Board. The Escrow
Holder will have no liability for any act or omissions hereunder while acting in good faith in the exercise of his or her own judgment. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>4. <U>Stock
Splits, etc</U></B>. If, while any of the Awarded Shares remain subject to vesting under <U>Section&nbsp;2</U>, there occurs any merger, consolidation, reorganization, reclassification, recapitalization, stock split, stock dividend, or other similar
change in the Common Stock, then any and all new, substituted or additional securities or other consideration to which the Grantee is entitled by reason of the Grantee&#146;s ownership of the Awarded Shares will be immediately subject to the escrow
contemplated by <U>Section&nbsp;3</U>, deposited with the Escrow Holder and will thereafter be included in the term &#147;Awarded Shares&#148; for all purposes of the Plan and this Agreement. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>5. <U>Dividends and Distributions During Restricted Period</U></B>. The Grantee will have the right to receive dividends and distributions with respect to
the Awarded Shares; <U>provided</U>, <U>however</U>, that any cash dividends or distributions paid in respect of the Awarded Shares while those Shares remain subject to forfeiture will become vested and delivered to the Grantee only if and when the
Awarded Shares giving rise to such dividends or distributions become vested under <U>Section&nbsp;2</U>. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>6. <U>Tax Consequences</U></B>. The Grantee
acknowledges that the Company has not advised the Grantee regarding the Grantee&#146;s income tax liability in connection with the grant, receipt or vesting of the Awarded Shares. The Grantee has reviewed with the Grantee&#146;s own tax advisors the
federal, state, local and foreign tax consequences of this investment and the transactions contemplated by this Agreement. The Grantee is relying solely on such advisors and not on any statements or representations of the Company or any of its
agents. The Grantee understands that the Grantee (and not the Company) will be responsible for the Grantee&#146;s own tax liability that may arise as a result of the transactions contemplated by this Agreement. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>7. <U>Restrictions on Unvested Awarded Shares</U></B>. Except for the escrow described in <U>Section&nbsp;3</U> or the forfeiture of Awarded Shares to the
Company described in <U>Section&nbsp;2</U>, the Grantee may not sell, pledge, assign, encumber, hypothecate, gift, transfer, bequeath, devise, donate or otherwise dispose of, in any way or manner whatsoever, whether voluntary or involuntary, any
legal or beneficial interest in any of the Awarded Shares until the Awarded Shares become vested in accordance with <U>Section&nbsp;2</U>; <U>provided</U>, <U>however</U>, that the restrictions of this <U>Section&nbsp;7</U> shall not apply to any
transfer i) pursuant to applicable laws of descent and distribution or (ii)&nbsp;among Grantee&#146;s family group; provided that such restrictions will continue to </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">3 </P>


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be applicable to the Awarded Shares after any such transfer and the transferees of such Awarded Shares have agreed in writing to be bound by the provisions of this Agreement. Grantee&#146;s
&#147;family group&#148; means Grantee&#146;s spouse and descendants (whether natural or adopted) and any trust solely for the benefit of Grantee and/or Grantee&#146;s spouse and/or descendants during Grantee&#146;s lifetime. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>8. <U>Legend</U></B>. Share certificates evidencing Awarded Shares will bear the following legend to be placed on all certificates evidencing any Awarded
Shares (in addition to any other legends that may be required to be placed on such certificates pursuant to the Plan, applicable law or otherwise): </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; margin-right:4%; font-size:10pt; font-family:Times New Roman" ALIGN="justify"><B>THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND
CONDITIONS (INCLUDING FORFEITURE) OF THE VASCO DATA SECURITY INTERNATIONAL, INC. 2009 EQUITY INCENTIVE PLAN AND AN AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER AND VASCO DATA SECURITY INTERNATIONAL, INC. COPIES OF SUCH PLAN AND AGREEMENT ARE
ON FILE IN THE PRINCIPAL OFFICES OF VASCO DATA SECURITY INTERNATIONAL, INC. AND WILL BE MADE AVAILABLE TO ANY SHAREHOLDER WITHOUT CHARGE UPON REQUEST TO THE SECRETARY OF THE COMPANY. </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Upon request by the Grantee, following vesting of the Awarded Shares pursuant to <U>Section&nbsp;2</U>, the Company will remove the legend from the
certificates evidencing such vested Awarded Shares. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>9. <U>Rights of Grantee</U></B>. Prior to the Awarded Shares becoming vested in accordance with
<U>Section&nbsp;2</U>, with respect to the Awarded Shares, Grantee will have all of the rights of a shareholder of the Company, including the right to vote the Awarded Shares and the right to receive any distributions or dividends payable on Shares,
subject to the reinvestment and forfeiture provisions of the Plan and to <U>Sections 4</U> and <U>5</U>. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>10. <U>Securities Laws</U></B>. The Company
may from time to time impose any conditions on the Awarded Shares as it deems necessary or advisable to ensure that the Plan satisfies the conditions of Rule 16b-3 adopted under the Securities and Exchange Act of 1934 and otherwise complies with
applicable rules and laws. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>11. <U>Recoupment of Awarded Shares</U></B>. Notwithstanding anything in this Agreement to the contrary, if the Company
determines that the Grantee&#146;s Wrongful Act was a significant contributing factor to the Company or a subsidiary having to restate all or a portion of its financial statements, all outstanding Awarded Shares will immediately and automatically be
forfeited and the Grantee shall promptly repay to the Company any Common Stock, cash or other property paid in respect of any Awarded Share during the Recoupment Period. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">4 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">For purposes of this Agreement, &#147;<B>Wrongful Act</B>&#148; means: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(a) Grantee materially breaches Grantee&#146;s obligations under any employment, consulting, or other agreement between the Grantee (or any
entity of which Grantee is an affiliate) and the Company (each, a &#147;<B>Company Agreement</B>&#148;); </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(b) Grantee materially breaches
Grantee&#146;s obligations under the Company&#146;s Code of Ethics and Conduct (or any successor thereto) or an established policy of the Company; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(c) Grantee engages in conduct prohibited by law (other than minor violations), commits an act of dishonesty, fraud, or serious or willful
misconduct in connection with Grantee&#146;s job duties, or engages in unethical or immoral conduct that, in the reasonable judgment of the Committee, could injure the integrity, character or reputation of Company; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(d) Grantee fails or refuses to perform, or habitually neglects, Grantee&#146;s duties and responsibilities under any Company Agreement and
continues such failure, refusal or neglect after having been given written notice by the Company that specifies what duties Grantee failed to perform and an opportunity to cure of 30 days; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(e) Use or disclosure by Grantee of confidential information or trade secrets other than in the furtherance of the Company&#146;s (or its
subsidiaries&#146;) business interests, or other violation of a fiduciary duty to the Company (including, without limitation, entering into any transaction or contractual relationship causing diversion of business opportunity from the Company (other
than with the prior written consent of the Board); or </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(f) Grantee fails to reasonably cooperate with any audit or investigation involving
the Company or its business practices after having been given written notice by the Company that specifies Grantee&#146;s failure to cooperate and an opportunity to cure of 10 days. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>12. <U>General Provisions</U></B> </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(a) This
Agreement, together with the Plan, represent the entire agreement between the parties with respect to the purchase of the Awarded Shares and may only be modified or amended in a writing signed by both parties. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(b) Any notice, demand or request required or permitted to be given by either the Company or the Grantee pursuant to the terms of this
Agreement must be in writing and will be deemed given (i)&nbsp;on the date and at the time delivered via personal, courier or recognized overnight delivery service, (ii)&nbsp;if sent via telecopier on the date and at the time telecopied with
confirmation of delivery, (iii)&nbsp;if sent via email or other electronic delivery and receipt is confirmed, on the date and at the time received, or (iv)&nbsp;if mailed, on the date five days after the date of the mailing (which must be by
registered or certified mail). Delivery of a notice by telecopy (with confirmation) or by email or other electronic delivery (with confirmation or receipt) will be permitted and will be considered delivery of a notice notwithstanding that it is not
an original that is received. Any notice to Grantee under this Agreement will be made to Grantee at the address (or telecopy number, email or other electronic address, as the case may be) listed in the Company&#146;s
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">5 </P>


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personnel files. If directed to the Company, any such notice, demand or request will be sent to the Chairman of the Compensation Committee of the Board of Directors at the Company&#146;s
principal executive office, or to such other address or person as the Company may hereafter specify in writing. Any notice to the Escrow Holder will be sent to the Company&#146;s address, with a copy to the other party not sending the notice. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(c) The Company may condition delivery of certificates for Awarded Shares (or, if the Awarded Shares are not certificated, the entry in the
stock record books of the Company of the transfer to the Grantee of the Awarded Shares) upon the prior receipt from Grantee of any undertakings which it may determine are required to assure that the certificates are being issued in compliance with
federal and state securities laws. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(d) The Grantee has received a copy of the Plan, has read the Plan and is familiar with its terms, and
hereby accepts the Awarded Shares subject to all of the terms and provisions of the Plan, as amended from time to time. Pursuant to the Plan, the Board and the Committee are authorized to interpret the Plan and to adopt rules and regulations not
inconsistent with the Plan as they deem appropriate. The Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board or the Committee upon any questions arising under the Plan. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(e) Neither this Agreement nor any rights or interest hereunder will be assignable by the Grantee, the Grantee&#146;s beneficiaries or legal
representatives, and any purported assignment in violation hereof will be null and void. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(f) Either party&#146;s failure to enforce any
provision or provisions of this Agreement will not in any way be construed as a waiver of any such provision or provisions, nor prevent that party thereafter from enforcing each and every other provision of this Agreement. The rights granted both
parties herein are cumulative and will not constitute a waiver of either party&#146;s right to assert all other legal remedies available to it under the circumstances. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(g) The grant of Awarded Shares hereunder does not confer upon the Grantee any right to continue in service with the Company or any of its
subsidiaries. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(h) The Awarded Shares and any related dividends or distributions are intended to be exempt from the requirements of
Internal Revenue Code Section&nbsp;409A. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(i) This Agreement shall be governed by, and enforced in accordance with, the laws of the State
of Delaware, without regard to the application of the principles of conflicts or choice of laws. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(j) This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original, and all of which together shall be deemed to be one and the same instrument. In the event that any signature to this Agreement is delivered by facsimile transmission or by e-mail
delivery of a &#147;.pdf&#148; format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or
&#147;.pdf&#148; signature page were an original thereof. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">6 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>[Signature Page Follows] </I></P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">7 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>[SIGNATURE PAGE TO AWARD AGREEMENT FOR RESTRICTED SHARES] </I></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>IN WITNESS WHEREOF</B>, the parties have duly executed this Award Agreement intending it to be effective as of the first date written
above. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


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<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"><B>VASCO DATA SECURITY INTERNATIONAL, INC.</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
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<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Mark S. Hoyt</P></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Its:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">CFO and Corporate Secretary</P></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
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<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Scott Clements</P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3">Scott Clements</TD></TR>
</TABLE></DIV>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">8 </P>

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<TYPE>EX-10.3
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<FILENAME>d295449dex103.htm
<DESCRIPTION>EX-10.3
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 10.3 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>AWARD AGREEMENT FOR PERFORMANCE SHARES </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>UNDER THE </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>VASCO DATA
SECURITY INTERNATIONAL, INC. </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>2009 EQUITY INCENTIVE PLAN </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>THIS AWARD AGREEMENT FOR RESTRICTED SHARES</B> (this &#147;<B>Agreement</B>&#148;) is made as of January&nbsp;4, 2016 (the
&#147;<B>Effective Date</B>&#148;), between VASCO DATA SECURITY INTERNATIONAL, INC. (the &#147;<B>Company</B>&#148;) and Scott Clements (the &#147;<B>Grantee</B>&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>WHEREAS</B>, the Company maintains the VASCO Data Security International, Inc. 2009 Equity Incentive Plan (as amended, the
&#147;<B>Plan</B>&#148;) for the benefit of its employees, directors, consultants, and other individuals who provide services to the Company; and </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>WHEREAS</B>, to compensate the Grantee for his service to the Company and to further align the Grantee&#146;s personal financial interests
with those of the Company&#146;s shareholders, the Company wishes to award the Grantee a number of shares of Common Stock (as defined below), subject to the restrictions, terms and conditions contained in the Plan and this Agreement. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>NOW, THEREFORE</B>, in consideration of these premises and the agreements set forth herein, the parties, intending to be legally bound
hereby, agree as follows: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>1. <U>Grant of Restricted Shares</U></B>. The Company hereby grants to the Grantee an award of the shares set forth on
<U>Exhibit A</U> hereto (the &#147;<B>Awarded Shares</B>&#148;) of the Company&#146;s common stock, par value of $0.001 per share (the &#147;<B>Common Stock</B>&#148;), subject to the terms and conditions set forth in this Agreement and in the Plan.
The terms of the Plan are hereby incorporated into this Agreement by this reference, as though fully set forth herein. Capitalized terms used but not defined in this Agreement have the meanings set forth in the Plan. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>2. <U>Vesting of Awarded Shares</U></B>. Subject to <U>Section&nbsp;11</U>, the Awarded Shares are subject to forfeiture to the Company until they become
vested in accordance with this <U>Section&nbsp;2</U>. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(a) <U>Performance Periods</U>. The number of Awarded Shares that are earned and
thereafter subject to vesting (the &#147;<B>Earned Shares</B>&#148;) shall be determined by the Compensation Committee, in its sole and absolute discretion, in accordance with <U>Exhibit A</U>, based upon the Company&#146;s achievement relative to
the applicable Performance Targets (i)&nbsp;for fifty percent of the Awarded Shares (the &#147;<B>One Year Awarded Shares</B>&#148;) during the period commencing on January&nbsp;1, 2016 and ending on December&nbsp;31, 2016, and (ii)&nbsp;for fifty
percent of the Awarded Shares (the &#147;<B>Three Year Awarded Shares</B>&#148;) during the period commencing on January&nbsp;1, 2016 and ending on December&nbsp;31, 2018 (each a &#147;<B>Performance Period</B>&#148;, and together the
&#147;<B>Performance Periods</B>&#148;). Upon the determination that some number of the One Year Awarded Shares are Earned Shares, <U>subject to Section&nbsp;11</U>, 25% of the Earned Shares that are One Year Awarded Shares shall be vested, and upon
the determination that some number of the Three Year Awarded Shares are Earned Shares, <U>subject to Section&nbsp;11</U>, all of the Earned Shares that are Three Year Awarded Shares shall be vested. For the avoidance of doubt, the One Year Awarded
Shares and Three Year Awarded shall be automatically forfeited in their entirety if their respective Performance Target is not achieved at least at the minimum threshold level. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">1 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(b) <U>Time Vesting Period</U>. Subject to <U>Section&nbsp;11</U>, the Earned Shares which are
One Year Awarded Shares will be subject to additional vesting, in accordance with the following schedule (the &#147;<B>Time Vesting Period</B>&#148;), provided that on each vesting date, the Grantee has, from the Effective Date, continuously
provided services to the Company or a subsidiary: </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(A) An additional 25% of the Earned Shares which are One Year Awarded Shares will vest
on the second anniversary of the Effective Date; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(B) An additional 25% of the Earned Shares which are One Year Awarded Shares will vest on
the third anniversary of the Effective Date; and </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(C) The final 25% of the Earned Shares which are One Year Awarded Shares will vest on the
fourth anniversary of the Effective Date. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">Any Awarded Shares which are One Year Awarded Shares that have not vested pursuant to this
<U>Section&nbsp;2</U> will be automatically forfeited. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(b.) Upon cessation of the Grantee&#146;s service with the Company for any reason
or for no reason (and whether such cessation is initiated by the Company, the Grantee or otherwise): (i)&nbsp;any Awarded Shares that have not, prior to such cessation, become vested will immediately and automatically, without any action on the part
of the Company, be forfeited, and (ii)&nbsp;the Grantee shall have no further rights with respect to those Awarded Shares. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(c.) Solely for
purposes of this Agreement, service with the Company shall be deemed to include service with any subsidiary of the Company (for only so long as such entity remains a subsidiary). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>3. <U>Escrow of Shares</U></B>. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(a)
Certificates evidencing the Awarded Shares issued under this Agreement shall be held in escrow by the Secretary of the Company or his or her designee (the &#147;<B>Escrow Holder</B>&#148;) (or, if the Awarded Shares are not certificated, shall be
entered in the stock record books of the Company as held in escrow by the Escrow Holder) until such Awarded Shares are earned and vested in accordance with <U>Section&nbsp;2</U>, at which time, the Escrow Holder shall deliver such certificates
representing the vested and earned Awarded Shares to the Grantee (or, if the Awarded Shares are not certificated, the Awarded Shares shall be entered in the stock record books of the Company as held and owned by the Grantee); <U>provided</U>,
<U>however</U>, that no certificates for Awarded Shares will be delivered to the Grantee (or, if the Awarded Shares are not certificated, no transfer of the Awarded Shares will be entered in the stock record books of the Company) until appropriate
arrangements have been made with the Company for the withholding or payment of any taxes that may be due with respect to such Awarded Shares. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">2 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(b) If any of the Awarded Shares are forfeited by the Grantee under <U>Section&nbsp;2</U>, upon
request by the Company, the Escrow Holder will deliver any stock certificate(s) evidencing those Awarded Shares to the Company (or, if the Awarded Shares are not certificated, such forfeiture will be entered in the stock record books of the
Company), and the Company will then have the right to retain and transfer those Awarded Shares to its own name free and clear of any rights of the Grantee under this Agreement or otherwise. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(c) The Escrow Holder is hereby directed to permit transfer of the Awarded Shares only in accordance with this Agreement or in accordance with
instructions signed by both parties hereto. In the event further instructions are reasonably desired by the Escrow Holder, he or she will be entitled to conclusively rely upon directions executed by a majority of the members of the Board. The Escrow
Holder will have no liability for any act or omissions hereunder while acting in good faith in the exercise of his or her own judgment. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>4. <U>Stock
Splits, etc</U></B>. If, while any of the Awarded Shares remain subject to vesting under <U>Section&nbsp;2</U>, there occurs any merger, consolidation, reorganization, reclassification, recapitalization, stock split, stock dividend, or other similar
change in the Common Stock, then any and all new, substituted or additional securities or other consideration to which the Grantee is entitled by reason of the Grantee&#146;s ownership of the Awarded Shares will be immediately subject to the escrow
contemplated by <U>Section&nbsp;3</U>, deposited with the Escrow Holder and will thereafter be included in the term &#147;Awarded Shares&#148; for all purposes of the Plan and this Agreement. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>5. <U>Dividends and Distributions During Performance Period</U></B>. The Grantee will have no rights to dividends or Dividend Equivalents with respect to
any of the Awarded Shares until, and then only to the extent of, the determination under <U>Section&nbsp;2(a)</U> that they are Earned Shares; <U>provided</U>, <U>however</U>, that any cash dividends or distributions paid in respect of the Earned
Shares during the Time Vesting Period and while those shares remain subject to forfeiture will become vested and delivered to the Grantee only if and when the Earned Shares giving rise to such dividends or distributions become vested under
<U>Section&nbsp;2</U>. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>6. <U>Tax Consequences</U></B>. The Grantee acknowledges that the Company has not advised the Grantee regarding the
Grantee&#146;s income tax liability in connection with the grant, receipt or vesting of the Awarded Shares. The Grantee has reviewed with the Grantee&#146;s own tax advisors the federal, state, local and foreign tax consequences of this investment
and the transactions contemplated by this Agreement. The Grantee is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Grantee understands that the Grantee (and not the Company) will
be responsible for the Grantee&#146;s own tax liability that may arise as a result of the transactions contemplated by this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>7.
<U>Restrictions on Unvested Awarded Shares</U></B>. Except for the escrow described in <U>Section&nbsp;3</U> or the forfeiture of Awarded Shares to the Company described in <U>Section&nbsp;2</U>, the
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">3 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
Grantee may not sell, pledge, assign, encumber, hypothecate, gift, transfer, bequeath, devise, donate or otherwise dispose of, in any way or manner whatsoever, whether voluntary or involuntary,
any legal or beneficial interest in any of the Awarded Shares until the Awarded Shares become vested in accordance with <U>Section&nbsp;2</U>; <U>provided</U>, <U>however</U>, that the restrictions of this <U>Section&nbsp;7</U> shall not apply to
any transfer i) pursuant to applicable laws of descent and distribution or (ii)&nbsp;among Grantee&#146;s family group; provided that such restrictions will continue to be applicable to the Awarded Shares after any such transfer and the transferees
of such Awarded Shares have agreed in writing to be bound by the provisions of this Agreement. Grantee&#146;s &#147;family group&#148; means Grantee&#146;s spouse and descendants (whether natural or adopted) and any trust solely for the benefit of
Grantee and/or Grantee&#146;s spouse and/or descendants during Grantee&#146;s lifetime. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>8. <U>Legend</U></B>. Share certificates evidencing Awarded
Shares will bear the following legend to be placed on all certificates evidencing any Awarded Shares (in addition to any other legends that may be required to be placed on such certificates pursuant to the Plan, applicable law or otherwise): </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; margin-right:4%; font-size:10pt; font-family:Times New Roman" ALIGN="justify"><B>THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND
CONDITIONS (INCLUDING FORFEITURE) OF THE VASCO DATA SECURITY INTERNATIONAL, INC. 2009 EQUITY INCENTIVE PLAN AND AN AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER AND VASCO DATA SECURITY INTERNATIONAL, INC. COPIES OF SUCH PLAN AND AGREEMENT ARE
ON FILE IN THE PRINCIPAL OFFICES OF VASCO DATA SECURITY INTERNATIONAL, INC. AND WILL BE MADE AVAILABLE TO ANY SHAREHOLDER WITHOUT CHARGE UPON REQUEST TO THE SECRETARY OF THE COMPANY. </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Upon request by the Grantee, following vesting of the Awarded Shares pursuant to <U>Section&nbsp;2</U>, the Company will remove the legend from the
certificates evidencing such vested Awarded Shares. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>9. <U>Rights of Grantee</U></B>. Grantee shall have no voting rights or any other rights of a
shareholder of the Company in any Awarded Shares until, and then only to the extent of, the determination under <U>Section&nbsp;2(a)</U> that they are Earned Shares. During the Time Vesting Period, Grantee will have all of the rights of a
shareholder of the Company with respect to the Earned Shares, including the right to vote such shares and, subject to <U>Section&nbsp;4</U> and <U>Section&nbsp;5</U> and the provisions of the Plan, the right to receive any distributions or dividends
payable on such shares. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>10. <U>Securities Laws</U></B>. The Company may from time to time impose any conditions on the Awarded Shares as it deems
necessary or advisable to ensure that the Plan satisfies the conditions of Rule 16b-3 adopted under the Securities and Exchange Act of 1934 and otherwise complies with applicable rules and laws. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>11. <U>Recoupment of Awarded Shares</U></B>. Notwithstanding anything in this Agreement to the contrary, if the Company determines that the Grantee&#146;s
Wrongful Act was a significant contributing factor to the Company or a subsidiary having to restate all or a portion of its </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">4 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
financial statements, all outstanding Awarded Shares will immediately and automatically be forfeited and the Grantee shall promptly repay to the Company any Common Stock, cash or other property
paid in respect of any Awarded Share during the Recoupment Period. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">For purposes of this Agreement, &#147;<B>Wrongful Act</B>&#148; means:
</P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(i) Grantee materially breaches Grantee&#146;s obligations under any employment, consulting, or other agreement between the Grantee (or
any entity of which Grantee is an affiliate) and the Company (each, a &#147;<B>Company Agreement</B>&#148;); </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(ii) Grantee materially
breaches Grantee&#146;s obligations under the Company&#146;s Code of Ethics and Conduct (or any successor thereto) or an established policy of the Company; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(iii) Grantee engages in conduct prohibited by law (other than minor violations), commits an act of dishonesty, fraud, or serious or willful
misconduct in connection with Grantee&#146;s job duties, or engages in unethical or immoral conduct that, in the reasonable judgment of the Committee, could injure the integrity, character or reputation of Company; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(iv) Grantee fails or refuses to perform, or habitually neglects, Grantee&#146;s duties and responsibilities under any Company Agreement (other
than on account of Disability), and continues such failure, refusal or neglect after having been given written notice by the Company that specifies what duties Grantee failed to perform and an opportunity to cure of 30 days; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(v) Use or disclosure by Grantee of confidential information or trade secrets other than in the furtherance of the Company&#146;s (or its
subsidiaries&#146;) business interests, or other violation of a fiduciary duty to the Company (including, without limitation, entering into any transaction or contractual relationship causing diversion of business opportunity from the Company (other
than with the prior written consent of the Board)); or </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(vi) Grantee fails to reasonably cooperate with any audit or investigation
involving the Company or its business practices after having been given written notice by the Company that specifies Grantee&#146;s failure to cooperate and an opportunity to cure of 10 days. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>12. <U>General Provisions</U></B> </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(a) This
Agreement, together with the Plan, represent the entire agreement between the parties with respect to the purchase of the Awarded Shares and may only be modified or amended in a writing signed by both parties. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(b) Any notice, demand or request required or permitted to be given by either the Company or the Grantee pursuant to the terms of this
Agreement must be in writing and </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">5 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
will be deemed given (i)&nbsp;on the date and at the time delivered via personal, courier or recognized overnight delivery service, (ii)&nbsp;if sent via telecopier on the date and at the time
telecopied with confirmation of delivery, (iii)&nbsp;if sent via e-mail or other electronic delivery and receipt is confirmed, on the date and at the time received, or (iv)&nbsp;if mailed, on the date five days after the date of the mailing (which
must be by registered or certified mail). Delivery of a notice by telecopy (with confirmation) or by e-mail or other electronic delivery (with confirmation or receipt) will be permitted and will be considered delivery of a notice notwithstanding
that it is not an original that is received. Any notice to Grantee under this Agreement will be made to Grantee at the address (or telecopy number, email or other electronic address, as the case may be) listed in the Company&#146;s personnel files.
If directed to the Company, any such notice, demand or request will be sent to the Chairman of the Committee at the Company&#146;s principal executive office, or to such other address or person as the Company may hereafter specify in writing. Any
notice to the Escrow Holder will be sent to the Company&#146;s address, with a copy to the other party not sending the notice. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(c) The
Company may condition delivery of certificates for Awarded Shares (or, if the Awarded Shares are not certificated, the entry in the stock record books of the Company of the transfer to the Grantee of the Awarded Shares) upon the prior receipt from
Grantee of any undertakings which it may determine are required to assure that the certificates are being issued in compliance with federal and state securities laws. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(d) The Grantee has received a copy of the Plan, has read the Plan and is familiar with its terms, and hereby accepts the Awarded Shares
subject to all of the terms and provisions of the Plan, as amended from time to time. Pursuant to the Plan, the Board and the Committee are authorized to interpret the Plan and to adopt rules and regulations not inconsistent with the Plan as they
deem appropriate. The Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board or the Committee upon any questions arising under the Plan. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(e) Neither this Agreement nor any rights or interest hereunder will be assignable by the Grantee, the Grantee&#146;s beneficiaries or legal
representatives, and any purported assignment in violation hereof will be null and void. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(f) Either party&#146;s failure to enforce any
provision or provisions of this Agreement will not in any way be construed as a waiver of any such provision or provisions, nor prevent that party thereafter from enforcing each and every other provision of this Agreement. The rights granted both
parties herein are cumulative and will not constitute a waiver of either party&#146;s right to assert all other legal remedies available to it under the circumstances. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(g) The grant of Awarded Shares hereunder does not confer upon the Grantee any right to continue in service with the Company or any of its
subsidiaries. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(h) The Awarded Shares and any related dividends or distributions are intended to be exempt from the requirements of
Internal Revenue Code Section&nbsp;409A. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">6 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(i) This Agreement shall be governed by, and enforced in accordance with, the laws of the State
of Delaware, without regard to the application of the principles of conflicts or choice of laws. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(j) This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original, and all of which together shall be deemed to be one and the same instrument. In the event that any signature to this Agreement is delivered by facsimile transmission or by e-mail
delivery of a &#147;.pdf&#148; format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or
&#147;.pdf&#148; signature page were an original thereof. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman"><B>IN WITNESS WHEREOF</B>, the parties have duly executed this Award Agreement
intending it to be effective as of the first date written above. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="42%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="6%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="92%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"><B>VASCO DATA SECURITY INTERNATIONAL, INC.</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Mark S. Hoyt</P></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Its:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">CFO and Corporate Secretary</P></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Scott Clements</P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"><B>Scott Clements, Grantee</B></TD></TR>
</TABLE></DIV>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">7 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><U>Exhibit A </U></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Performance Targets </U></B> </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The number of Earned Shares,
if any, will be dependent on the Company&#146;s achievement of the Performance Targets as defined below: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The &#147;<B>Performance Target</B>&#148; for
the <I>One Year Awarded Shares</I> is comprised of four sub-targets; </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">a.)</TD>
<TD ALIGN="left" VALIGN="top">2016 VASCO Revenue - $253.0 million of total 2016 revenue excluding 2016 revenue from acquisitions closed after the Effective Date. Total revenue is reported in the Company&#146;s audited financial statements. Revenue
from acquisitions closed after the Effective Date shall be determined by the Company in accordance with U.S. Generally Accepted Accounting Principles. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">b.)</TD>
<TD ALIGN="left" VALIGN="top">2016 VASCO Operating Income - $45.0 million of 2016 operating income less 2016 amortization of purchased intangibles excluding 2016 operating income less amortization of purchased intangibles from all acquisitions
closed after the Effective Date. Operating income and amortization of purchased intangibles are reported in the Company&#146;s audited financial statements. Operating income less amortization of purchased intangibles from acquisitions closed after
the Effective Date shall be determined by the Company in accordance with U.S. Generally Accepted Accounting Principles. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">c.)</TD>
<TD ALIGN="left" VALIGN="top">2016 eSignLive Revenue - $22.7 million of 2016 eSignLive bookings comprised of aggregate recurring annual contract values for subscription and maintenance contracts commencing or renewing during 2016 and revenues from
perpetual licenses recognized in accordance with U.S. Generally Accepted Accounting Principles as determined by the Administrator. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">d.)</TD>
<TD ALIGN="left" VALIGN="top">2016 eSignLive Operating Income (Loss) &#150; $(9.7) million of 2016 eSignLive operating income less 2016 amortization of purchased intangibles; including deferred revenues and deferred costs as of the acquisition date
that would have been otherwise recognized during 2016 in accordance with U.S. GAAP absent the acquisition by VASCO, and excluding 2016 operating income less amortization of purchased intangibles from all acquisitions closed after the Effective Date.
eSignLive operating income, amortization of purchased intangibles, and operating income less amortization of purchased intangibles from acquisitions closed after the Effective Date shall be determined by the Administrator in accordance with U.S.
Generally Accepted Accounting Principles. </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The &#147;<B>Performance Target</B>&#148; for the <I>Three Year Awarded Shares</I> is $320.0
million of total revenue during 2018 less revenue during 2018 from all acquisitions closed after the Effective Date. Total revenue is reported in the Company&#146;s audited financial statements. Revenue from acquisitions closed after the Effective
Date shall be determined by the Company in accordance with U.S. Generally Accepted Accounting Principles. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">8 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>One Year Awarded Shares: </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B></B>The target number of Awarded Shares for 100% achievement of the Performance Target for the One Year Awarded Shares is:<B> 21,935 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The following tables show the number of One Year Awarded Shares that will be earned (i.e. become Earned Shares) and will be payable to the Grantee (subject to
vesting as provided in <U>Section&nbsp;2</U> of the Award Agreement) based on achievement of the four sub-targets at various levels: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">2016 VASCO Revenue
</P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="76%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="58%"></TD>
<TD VALIGN="bottom" WIDTH="17%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="17%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom" NOWRAP> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; width:103.35pt; font-size:8pt; font-family:Times New Roman"><B>Actual Performance (millions)</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Percentage&nbsp;of&nbsp;One&nbsp;Year<BR>Awarded&nbsp;Shares&nbsp;earned&nbsp;(as<BR>a percentage of the target<BR>number of
Awarded</B><br><B>Shares)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Number&nbsp;of&nbsp;Earned<BR>Shares</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(minimum threshold) $240.0</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">50</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">4,113</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(target) $253.0</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">100</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">8,226</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(maximum) $263.0 or higher</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">150</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">12,339</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">2016 VASCO Operating Income </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="76%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="57%"></TD>
<TD VALIGN="bottom" WIDTH="18%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="18%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom" NOWRAP> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; width:103.35pt; font-size:8pt; font-family:Times New Roman"><B>Actual Performance (millions)</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Percentage&nbsp;of&nbsp;One&nbsp;Year<BR>Awarded&nbsp;Shares&nbsp;earned&nbsp;(as<BR>a percentage of the target<BR>number of
Awarded</B><br><B>Shares)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Number&nbsp;of&nbsp;Earned<BR>Shares</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(minimum threshold) $42.0</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">50</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">1,371</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(target) $45.0</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">100</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">2,742</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(maximum) $48.0 or higher</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">150</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">4,113</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">2016 eSignLive Revenue </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="76%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="58%"></TD>
<TD VALIGN="bottom" WIDTH="17%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="17%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom" NOWRAP> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; width:103.35pt; font-size:8pt; font-family:Times New Roman"><B>Actual Performance (millions)</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Percentage&nbsp;of&nbsp;One&nbsp;Year<BR>Awarded&nbsp;Shares&nbsp;earned&nbsp;(as<BR>a percentage of the target<BR>number of
Awarded</B><br><B>Shares)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Number&nbsp;of&nbsp;Earned<BR>Shares</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(minimum threshold) $21.2</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">50</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">4,113</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(target) $22.7</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">100</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">8,226</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(maximum) $24.2 or higher</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">150</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">12,339</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">9 </P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">2016 eSignLive Operating Income (Loss) </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="76%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="57%"></TD>
<TD VALIGN="bottom" WIDTH="18%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="18%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom" NOWRAP> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; width:103.35pt; font-size:8pt; font-family:Times New Roman"><B>Actual Performance (millions)</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Percentage&nbsp;of&nbsp;One&nbsp;Year<BR>Awarded&nbsp;Shares&nbsp;earned&nbsp;(as<BR>a percentage of the target<BR>number of
Awarded</B><br><B>Shares)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Number&nbsp;of&nbsp;Earned<BR>Shares</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(minimum threshold) $(11.0)</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">50</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">1,371</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(target) $(9.7)</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">100</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">2,742</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(maximum) $(8.0) or higher</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">150</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">4,113</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">Each of the four categories will be calculated independently. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">For each of the four categories, no shares are earned if actual performance is less than the minimum threshold level. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">For each of the four categories, the maximum number of Earned Shares is 150% of the target number of Award Shares. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">For each of the four categories, the number of Earned Shares that will be earned and payable for achievement of performance levels between the stated Performance Target achievement percentages shall be interpolated.
</TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Three Year Awarded Shares: </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B></B>The target number of Awarded Shares for 100% achievement of the Performance Target for the Three Year Awarded Shares is:<B> 21,935 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The following table shows the number of Three Year Awarded Shares that will be earned (i.e. become Earned Shares) and will be payable to the Grantee (subject
to vesting as provided in <U>Section&nbsp;2</U> of the Award Agreement) based on achievement of the Performance Target at various levels: </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="76%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="60%"></TD>
<TD VALIGN="bottom" WIDTH="16%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="16%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom" NOWRAP> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; border-bottom:1.00pt solid #000000; width:103.35pt; font-size:8pt; font-family:Times New Roman"><B>Actual Performance (millions)</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Percentage&nbsp;of&nbsp;Awarded<BR>Shares earned (as a</B><br><B>percentage&nbsp;of&nbsp;the&nbsp;target<BR>number of
Awarded</B><br><B>Shares)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" NOWRAP ALIGN="center" STYLE="border-bottom:1.00pt solid #000000"><B>Number&nbsp;of&nbsp;Earned<BR>Shares</B></TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(minimum threshold) $306.0</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">50</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">10,968</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(target) $320.0</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">100</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">21,935</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">(maximum) $334.0 or higher</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">150</TD>
<TD NOWRAP VALIGN="bottom">%&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">32,903</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">No shares are earned if actual performance is less than the minimum threshold level. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">The maximum number of Earned Shares is 150% of the target number of Award Shares. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left">&#149;</TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top">The number of Earned Shares that will be earned and payable for achievement of performance levels between the stated Performance Target achievement percentages shall be interpolated. </TD></TR></TABLE>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 99.1 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman"><B>VASCO Appoints Scott Clements as President and Chief Operating Officer </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>Clements to Succeed Jan Valcke, Who Will Retire from the Company </I></B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">OAKBROOK TERRACE, IL, and ZURICH, November&nbsp;15, 2016&#151;VASCO Data Security International, Inc. (NASDAQ: VDSI), a global leader in digital solutions
including identity, security and business productivity,&nbsp;today announced that Scott Clements, currently VASCO&#146;s EVP and Chief Strategy Officer, has been appointed President and Chief Operating Officer, effective immediately.
Mr.&nbsp;Clements will succeed Jan Valcke, who will retire from the company. Mr.&nbsp;Clements joined VASCO<SUP STYLE="font-size:85%; vertical-align:top">&reg;</SUP> in 2015 from Tyco, where he was previously the President of the billion-dollar
Retail Solutions business and the company&#146;s Chief Technology Officer. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;Scott is a seasoned executive with broad functional and operational
experience and the right skills to help us take VASCO to the next stage of growth,&#148; said T. Kendall Hunt, VASCO Chairman and CEO. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;Since
joining the company last year, Scott has proven himself to be a capable leader who has helped define our vision for future growth. He has proven success in identifying new market opportunities and bringing innovative solutions to market.
Scott&#146;s background in transforming and running large global businesses, as well as in building new businesses, will be instrumental as we position VASCO to realize new opportunities in the security industry and deliver increased shareholder
value.&#148; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;Jan Valcke made significant contributions to VASCO&#146;s strong record of growth and success during his tenure and we greatly
appreciate his service,&#148; continued Mr.&nbsp;Hunt. &#147;Jan&#146;s extraordinary talent and vision helped to establish VASCO as an industry leader. We thank him for his commitment and achievements and respect his decision to retire.&#148; </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;I am honored to have the opportunity to build on VASCO&#146;s many accomplishments,&#148; said Mr.&nbsp;Clements. &#147;We see myriad opportunities to
leverage our position as leaders in authentication and secure transaction technologies to enable trust in the digital world. Our profitable core business, expanding software offerings, global presence and significant financial flexibility are the
foundations of our growth strategies and our commitment to value creation for customers, shareholders and employees.&nbsp;I look forward to continuing to work with our strong management team and our dedicated employees around the globe.&#148;</P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Mr.&nbsp;Valcke commented, &#147;After almost two decades as part of the leadership team at VASCO, it is time for me to devote more attention to my family and
pass my responsibilities to new leadership. Scott has the experience and vision to take VASCO to the next level. It is gratifying that someone I respect and trust as much as I do Scott will be succeeding me as President and COO. I wish Scott, Ken,
and all of VASCO&#146;s talented, dedicated employees much success in the future.&#148; </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>About Scott Clements</B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Scott Clements has extensive experience in leadership roles in the technology industry with a strong focus on developing and deploying successful business
strategies that integrate customer needs and technology innovation. Before joining VASCO, Mr.&nbsp;Clements spent eleven years at Tyco International where he most recently served as Corporate Senior Vice President, Business Development focused on
technology acquisitions. Prior to that, Clements served as President of Tyco Retail Solutions and also as </P>

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Tyco&#146;s Chief Technology Officer. Before joining Tyco, Clements spent a decade at Honeywell International in domestic and international financial and operational leadership roles. Clements
received his bachelor&#146;s degree in chemical engineering and advanced process control from The Ohio State University and an MBA in finance and corporate strategy from the University of Michigan in Ann Arbor.</P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>About VASCO </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">VASCO is a global leader in delivering trust
and business productivity solutions to the digital market. VASCO develops next generation technologies that enable more than 10,000 customers in 100 countries in financial, enterprise, government, healthcare and other segments to achieve their
digital agenda, deliver an enhanced customer experience and meet regulatory requirements. More than half of the top 100 global banks rely on VASCO solutions to protect their online, mobile and ATM channels. VASCO&#146;s solutions combine to form a
powerful trust platform that empowers businesses by incorporating identity, fraud prevention, electronic and transaction signing, mobile application protection and risk analysis. Learn more about VASCO at <U>VASCO.com</U> and on <U>Twitter</U>,
<U>LinkedIn</U> and <U>Facebook</U>. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Forward Looking Statements: </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">This press release contains forward-looking statements within the meaning of Section&nbsp;21E of the Securities Exchange Act of 1934 and Section&nbsp;27A of
the Securities Act of 1933, including, without limitation the guidance for full year 2016. These forward-looking statements (1)&nbsp;are identified by use of terms and phrases such as &#147;expect&#148;, &#147;believe&#148;, &#147;will&#148;,
&#147;anticipate&#148;, &#147;emerging&#148;, &#147;intend&#148;, &#147;plan&#148;, &#147;could&#148;, &#147;may&#148;, &#147;estimate&#148;, &#147;should&#148;, &#147;objective&#148;, &#147;goal&#148;, &#147;possible&#148;, &#147;potential&#148;,
&#147;project&#148; and similar words and expressions, but such words and phrases are not the exclusive means of identifying them, and (2)&nbsp;are subject to risks and uncertainties and represent our present expectations or beliefs concerning
future events. VASCO cautions that the forward-looking statements are qualified by important factors that could cause actual results to differ materially from those in the forward-looking statements. These risks, uncertainties and other factors have
been described in our Annual Report on Form&nbsp;10-K for the year ended December&nbsp;31, 2015 and include, but are not limited to, (a)&nbsp;risks of general market conditions, including currency fluctuations and the uncertainties resulting from
turmoil in world economic and financial markets, (b)&nbsp;risks inherent to the computer and network security industry, including rapidly changing technology, evolving industry standards, increasingly sophisticated hacking attempts, increasing
numbers of patent infringement claims, changes in customer requirements, price competitive bidding, and changing government regulations, and (c)&nbsp;risks specific to VASCO, including demand for our products and services, competition from more
established firms and others, pressures on price levels and our historical dependence on relatively few products, certain suppliers and certain key customers. These&nbsp;risks, uncertainties and other factors include VASCO&#146;s ability to
integrate eSignLive&#153; into the global business of VASCO successfully and the amount of time and expense spent and incurred in connection with the integration; the risk that the revenue synergies, cost savings and other economic benefits that
VASCO anticipates as a result of this acquisition are not fully realized or take longer to realize than expected. Thus, the results that we actually achieve may differ materially from any anticipated results included in, or implied by these
statements. Except for our ongoing obligations to disclose material information as required by the U.S. federal securities laws, we do not have any obligations or intention to release publicly any revisions to any forward-looking statements to
reflect events or circumstances in the future or to reflect the occurrence of unanticipated events. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Copyright <SUP
STYLE="font-size:85%; vertical-align:top">&copy;</SUP> 2016 VASCO Data Security, Inc., VASCO Data Security International GmbH. All rights reserved. VASCO<SUP STYLE="font-size:85%; vertical-align:top">&reg;</SUP> and eSignLive&#153; are registered or
unregistered trademarks of VASCO Data Security, Inc. and/or VASCO Data Security International GmbH, or Silanis Technology Inc. in the U.S. and other countries. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">For more information contact: </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">John Gunn </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">+1-847-370-1486 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>john.gunn@vasco.com </U></P>
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