Stockholders' Equity

9 Months Ended

Sep. 30, 2019

9.	Stockholders’ Equity

Reconciliation of the changes in stockholders' equity for the three and nine months ended September 30, 2019 and 2018
	Common Stock					Additional Paid-in			Accumulated Other Comprehensive			Accumulated
	Shares			Amount		Capital			Loss			Deficit			Total
Balance at December 31, 2018		61,276		$	—	$	401,273		$	(18,706	)	$	(99,189	)	$	283,378
Common stock issued upon exercise of options		4			—		22			—			—			22
Vesting of restricted stock and performance stock units		664			—		—			—			—			—
Purchase and retirement of common shares		(277	)		—		(3,595	)		—			—			(3,595	)
Compensation cost for restricted stock		—			—		653			—			—			653
Compensation cost for stock option grants		—			—		324			—			—			324
Compensation cost for performance stock units		—			—		254			—			—			254
Net loss		—			—		—			—			(3,258	)		(3,258	)
Currency translation adjustments										2,232						2,232
Unrealized gain on marketable securities		—			—		—			497			—			497
Balance at March 31, 2019		61,667		$	—	$	398,931		$	(15,977	)	$	(102,447	)	$	280,507
Common stock issued upon exercise of options		18			—		147			—			—			147
Vesting of restricted stock and performance stock units		51			—		—			—			—			—
Purchase and retirement of common shares		(11	)		—		(109	)		—			—			(109	)
Compensation cost for restricted stock		—			—		874			—			—			874
Compensation cost for stock option grants		—			—		311			—			—			311
Compensation cost for performance stock units		—			—		(569	)		—			—			(569	)
Net income		—			—		—			—			4,398			4,398
Currency translation adjustments										2,476						2,476
Unrealized gain on marketable securities		—			—		—			186			—			186
Balance at June 30, 2019		61,725		$	—	$	399,585		$	(13,315	)	$	(98,049	)	$	288,221
Common stock issued upon exercise of options		-			—		—			—			—			-
Vesting of restricted stock and performance stock units		2			—		—			—			—			—
Purchase and retirement of common shares		(1	)		—		(7	)		—			—			(7	)
Compensation cost for restricted stock		-			—		858			—			—			858
Compensation cost for stock option grants		-			—		259			—			—			259
Compensation cost for performance stock units		-			—		319			—			—			319
Net income		-			—		—			—			13,078			13,078
Currency translation adjustments										(1,557	)					(1,557	)
Unrealized gain on marketable securities		-			—		—			194			—			194
Balance at September 30, 2019		61,726		$	—	$	401,014		$	(14,678	)	$	(84,971	)	$	301,365


	Common Stock					Additional Paid-in			Accumulated Other Comprehensive			Accumulated
	Shares			Amount		Capital			Loss			Deficit			Total
Balance at December 31, 2017		60,662		$	—	$	387,931		$	(10,340	)	$	(119,510	)	$	258,081
Adoption of ASU 2014-9													(75	)		(75	)
Common stock issued upon exercise of options		133			—		974			—			—			974
Vesting of restricted stock and performance stock units		407			—		—			—			—			—
Purchase and retirement of common shares		(149	)		—		(2,959	)		—			—			(2,959	)
Compensation cost for restricted stock		—			—		3,626			—			—			3,626
Compensation cost for stock option grants		—			—		900			—			—			900
Compensation cost for performance stock units		—			—		2,957			—			—			2,957
Net loss		—			—		—			—			(2,119	)		(2,119	)
Currency translation adjustments										(2,154	)					(2,154	)
Unrealized loss on marketable securities		—			—		—			(512	)		—			(512	)
Balance at March 31, 2018		61,053		$	—	$	393,429		$	(13,006	)	$	(121,704	)	$	258,719
Common stock issued upon exercise of options		29			—		222			—			—			222
Vesting of restricted stock and performance stock units		106			—		—			—			—			—
Purchase and retirement of common shares		(14	)		—		(212	)		—			—			(212	)
Compensation cost for restricted stock		—			—		1,419			—			—			1,419
Compensation cost for stock option grants		—			—		475			—			—			475
Compensation cost for performance stock units		—			—		1,885			—			—			1,885
Net income		—			—		—			—			4,121			4,121
Currency translation adjustments										(1,652	)					(1,652	)
Unrealized gain on marketable securities		—			—		—			194			—			194
Balance at June 30, 2018		61,174		$	—	$	397,218		$	(14,464	)	$	(117,583	)	$	265,171
Common stock issued upon exercise of options		62			—		483			—			—			483
Vesting of restricted stock and performance stock units		2			—		—			—			—			—
Purchase and retirement of common shares		(1	)		—		(9	)		—			—			(9	)
Compensation cost for restricted stock		—			—		589			—			—			589
Compensation cost for stock option grants		—			—		359			—			—			359
Compensation cost for performance stock units		—			—		316			—			—			316
Net income		—			—		—			—			8,096			8,096
Currency translation adjustments										1,783						1,783
Unrealized loss on marketable securities		—			—		—			(34	)		—			(34	)
Balance at September 30, 2018		61,237		$	—	$	398,956		$	(12,715	)	$	(109,487	)	$	276,754

Stock-Based Awards

We grant stock-based awards under the OraSure Technologies, Inc. Stock Award Plan, as amended (the “Stock Plan”). The Stock Plan permits stock-based awards to employees, outside directors and consultants or other third-party advisors. Awards which may be granted under the Stock Plan include qualified incentive stock options, nonqualified stock options, stock appreciation rights, restricted awards, performance awards and other stock-based awards. We account for stock-based compensation to employees and directors using the fair value method. We recognize compensation expense for stock option and restricted stock awards issued to employees and directors on a straight-line basis over the requisite service period of the award. We recognize compensation expense related to performance-based restricted stock units based on assumptions as to what percentage of each performance target will be achieved. We evaluate these target assumptions on a quarterly basis and adjust compensation

expense related to these awards, as appropriate. To satisfy the exercise of options, issuance of restricted stock, or redemption of performance-based restricted stock units, we issue new shares rather than shares purchased on the open market.

Total compensation cost related to stock options for the nine months ended September 30, 2019 and 2018 was $894 and $1,734 respectively.

Compensation cost of $2,385 and $5,634 related to restricted shares was recognized during the nine months ended September 30, 2019 and 2018, respectively. In connection with the vesting of restricted shares during the nine months ended September 30, 2019 and 2018, we purchased and immediately retired 289 and 164 shares with aggregate values of $3,711 and $3,181, respectively, in satisfaction of minimum tax withholding obligations.

We grant performance-based restricted stock units (“PSUs”) to certain executives. Vesting of these PSUs is dependent upon achievement of performance-based metrics during a one-year or three-year period from the date of grant. Assuming achievement of each performance-based metric, the executive must also generally remain in our service for three years from the grant date. Performance during the one-year period is based on a one-year earnings per share or income before income taxes target. If the one-year target is achieved, the PSUs will then vest three years from grant date. Performance during the three-year period will be based on achievement of a three-year compound annual growth rate for consolidated product revenues. If the three-year target is achieved, the corresponding PSUs will then vest three years from grant date. PSUs are converted into shares of our common stock once vested.

Compensation cost of $4 and $5,158 related to PSUs was recognized during the nine months ended September 30, 2019 and 2018, respectively.

Modification of Grants

Stock compensation costs for the nine months ended September 30, 2018 include the additional expense associated with modifications of existing grants held by our retired President and Chief Executive Officer (“CEO”) and our Chief Financial Officer (“CFO”). These additional costs were $8,039 during the nine months ended September 30, 2018, and are included in general and administrative expenses in the accompanying consolidated statement of income.

Stock Repurchase Program

On August 5, 2008, our Board of Directors approved a share repurchase program pursuant to which we are permitted to acquire up to $25,000 of our outstanding common shares. No shares were purchased and retired during the nine months ended September 30, 2019 and 2018.