EX-10.3



 Exhibit 10.3 

AWARD AGREEMENT FOR PERFORMANCE SHARES 

UNDER THE 
 VASCO DATA
SECURITY INTERNATIONAL, INC. 
 2009 EQUITY INCENTIVE PLAN 

THIS AWARD AGREEMENT FOR RESTRICTED SHARES (this “Agreement”) is made as of January 4, 2016 (the
“Effective Date”), between VASCO DATA SECURITY INTERNATIONAL, INC. (the “Company”) and Scott Clements (the “Grantee”). 

WHEREAS, the Company maintains the VASCO Data Security International, Inc. 2009 Equity Incentive Plan (as amended, the
“Plan”) for the benefit of its employees, directors, consultants, and other individuals who provide services to the Company; and 

WHEREAS, to compensate the Grantee for his service to the Company and to further align the Grantee’s personal financial interests
with those of the Company’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. 

NOW, THEREFORE, in consideration of these premises and the agreements set forth herein, the parties, intending to be legally bound
hereby, agree as follows: 
 1. Grant of Restricted Shares. The Company hereby grants to the Grantee an award of the shares set forth on
Exhibit A hereto (the “Awarded Shares”) of the Company’s common stock, par value of $0.001 per share (the “Common Stock”), 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. 

2. Vesting of Awarded Shares. Subject to Section 11, the Awarded Shares are subject to forfeiture to the Company until they become
vested in accordance with this Section 2. 
 (a) Performance Periods. The number of Awarded Shares that are earned and
thereafter subject to vesting (the “Earned Shares”) shall be determined by the Compensation Committee, in its sole and absolute discretion, in accordance with Exhibit A, based upon the Company’s achievement relative to
the applicable Performance Targets (i) for fifty percent of the Awarded Shares (the “One Year Awarded Shares”) during the period commencing on January 1, 2016 and ending on December 31, 2016, and (ii) for fifty
percent of the Awarded Shares (the “Three Year Awarded Shares”) during the period commencing on January 1, 2016 and ending on December 31, 2018 (each a “Performance Period”, and together the
“Performance Periods”). Upon the determination that some number of the One Year Awarded Shares are Earned Shares, subject to Section 11, 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, subject to Section 11, 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. 

  
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 (b) Time Vesting Period. Subject to Section 11, the Earned Shares which are
One Year Awarded Shares will be subject to additional vesting, in accordance with the following schedule (the “Time Vesting Period”), provided that on each vesting date, the Grantee has, from the Effective Date, continuously
provided services to the Company or a subsidiary: 
 (A) An additional 25% of the Earned Shares which are One Year Awarded Shares will vest
on the second anniversary of the Effective Date; 
 (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 
 (C) The final 25% of the Earned Shares which are One Year Awarded Shares will vest on the
fourth anniversary of the Effective Date. 
 Any Awarded Shares which are One Year Awarded Shares that have not vested pursuant to this
Section 2 will be automatically forfeited. 
 (b.) Upon cessation of the Grantee’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) 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) the Grantee shall have no further rights with respect to those Awarded Shares. 
 (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). 

3. Escrow of Shares. 
 (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 “Escrow Holder”) (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 Section 2, 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); provided,
however, 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. 

  
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 (b) If any of the Awarded Shares are forfeited by the Grantee under Section 2, 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. 

(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. 
 4. Stock
Splits, etc. If, while any of the Awarded Shares remain subject to vesting under Section 2, 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’s ownership of the Awarded Shares will be immediately subject to the escrow
contemplated by Section 3, deposited with the Escrow Holder and will thereafter be included in the term “Awarded Shares” for all purposes of the Plan and this Agreement. 

5. Dividends and Distributions During Performance Period. 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 Section 2(a) that they are Earned Shares; provided, however, 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
Section 2. 
 6. Tax Consequences. The Grantee acknowledges that the Company has not advised the Grantee regarding the
Grantee’s income tax liability in connection with the grant, receipt or vesting of the Awarded Shares. The Grantee has reviewed with the Grantee’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’s own tax liability that may arise as a result of the transactions contemplated by this Agreement. 
 7.
Restrictions on Unvested Awarded Shares. Except for the escrow described in Section 3 or the forfeiture of Awarded Shares to the Company described in Section 2, the


  
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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 Section 2; provided, however, that the restrictions of this Section 7 shall not apply to
any transfer i) pursuant to applicable laws of descent and distribution or (ii) among Grantee’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’s “family group” means Grantee’s spouse and descendants (whether natural or adopted) and any trust solely for the benefit of
Grantee and/or Grantee’s spouse and/or descendants during Grantee’s lifetime. 
 8. Legend. 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): 

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. 

Upon request by the Grantee, following vesting of the Awarded Shares pursuant to Section 2, the Company will remove the legend from the
certificates evidencing such vested Awarded Shares. 
 9. Rights of Grantee. 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 Section 2(a) 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 Section 4 and Section 5 and the provisions of the Plan, the right to receive any distributions or dividends
payable on such shares. 
 10. Securities Laws. 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. 

11. Recoupment of Awarded Shares. Notwithstanding anything in this Agreement to the contrary, if the Company determines that the Grantee’s
Wrongful Act was a significant contributing factor to the Company or a subsidiary having to restate all or a portion of its 

  
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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. 
 For purposes of this Agreement, “Wrongful Act” means:

 (i) Grantee materially breaches Grantee’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 “Company Agreement”); 
 (ii) Grantee materially
breaches Grantee’s obligations under the Company’s Code of Ethics and Conduct (or any successor thereto) or an established policy of the Company; 

(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’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; 

(iv) Grantee fails or refuses to perform, or habitually neglects, Grantee’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; 

(v) Use or disclosure by Grantee of confidential information or trade secrets other than in the furtherance of the Company’s (or its
subsidiaries’) 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 
 (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’s failure to cooperate and an opportunity to cure of 10 days. 

12. General Provisions 
 (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. 

(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 

  
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will be deemed given (i) on the date and at the time delivered via personal, courier or recognized overnight delivery service, (ii) if sent via telecopier on the date and at the time
telecopied with confirmation of delivery, (iii) if sent via e-mail or other electronic delivery and receipt is confirmed, on the date and at the time received, or (iv) 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’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’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’s address, with a copy to the other party not sending the notice. 
 (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. 

(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. 

(e) Neither this Agreement nor any rights or interest hereunder will be assignable by the Grantee, the Grantee’s beneficiaries or legal
representatives, and any purported assignment in violation hereof will be null and void. 
 (f) Either party’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’s right to assert all other legal remedies available to it under the circumstances. 

(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. 
 (h) The Awarded Shares and any related dividends or distributions are intended to be exempt from the requirements of
Internal Revenue Code Section 409A. 

  
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 (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. 
 (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 “.pdf” 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
“.pdf” signature page were an original thereof. 
 IN WITNESS WHEREOF, the parties have duly executed this Award Agreement
intending it to be effective as of the first date written above. 
  

			
	VASCO DATA SECURITY INTERNATIONAL, INC.
		
	By:	 	 /s/ Mark S. Hoyt

		
	Its:	 	 CFO and Corporate Secretary

	
	 /s/ Scott Clements

	Scott Clements, Grantee



  
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 Exhibit A 

Performance Targets  
 The number of Earned Shares,
if any, will be dependent on the Company’s achievement of the Performance Targets as defined below: 
 The “Performance Target” for
the One Year Awarded Shares is comprised of four sub-targets; 
  

	 	a.)	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’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. 

  

	 	b.)	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’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. 

  

	 	c.)	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. 

  

	 	d.)	2016 eSignLive Operating Income (Loss) – $(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. 

 The “Performance Target” for the Three Year Awarded Shares 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’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. 

  
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 One Year Awarded Shares: 

The target number of Awarded Shares for 100% achievement of the Performance Target for the One Year Awarded Shares is: 21,935 

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 Section 2 of the Award Agreement) based on achievement of the four sub-targets at various levels: 
 2016 VASCO Revenue

  

									
	 Actual Performance (millions)
	  	Percentage of One Year
Awarded Shares earned (as
a percentage of the target
number of
Awarded
Shares)	 	 	Number of Earned
Shares	 
	 (minimum threshold) $240.0
	  	 	50	% 	 	 	4,113	  
	 (target) $253.0
	  	 	100	% 	 	 	8,226	  
	 (maximum) $263.0 or higher
	  	 	150	% 	 	 	12,339	  

 2016 VASCO Operating Income 
  

									
	 Actual Performance (millions)
	  	Percentage of One Year
Awarded Shares earned (as
a percentage of the target
number of
Awarded
Shares)	 	 	Number of Earned
Shares	 
	 (minimum threshold) $42.0
	  	 	50	% 	 	 	1,371	  
	 (target) $45.0
	  	 	100	% 	 	 	2,742	  
	 (maximum) $48.0 or higher
	  	 	150	% 	 	 	4,113	  

 2016 eSignLive Revenue 
  

									
	 Actual Performance (millions)
	  	Percentage of One Year
Awarded Shares earned (as
a percentage of the target
number of
Awarded
Shares)	 	 	Number of Earned
Shares	 
	 (minimum threshold) $21.2
	  	 	50	% 	 	 	4,113	  
	 (target) $22.7
	  	 	100	% 	 	 	8,226	  
	 (maximum) $24.2 or higher
	  	 	150	% 	 	 	12,339	  


  
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 2016 eSignLive Operating Income (Loss) 
  


									
	 Actual Performance (millions)
	  	Percentage of One Year
Awarded Shares earned (as
a percentage of the target
number of
Awarded
Shares)	 	 	Number of Earned
Shares	 
	 (minimum threshold) $(11.0)
	  	 	50	% 	 	 	1,371	  
	 (target) $(9.7)
	  	 	100	% 	 	 	2,742	  
	 (maximum) $(8.0) or higher
	  	 	150	% 	 	 	4,113	  

  

	 	•	 	Each of the four categories will be calculated independently. 

  

	 	•	 	For each of the four categories, no shares are earned if actual performance is less than the minimum threshold level. 

  

	 	•	 	For each of the four categories, the maximum number of Earned Shares is 150% of the target number of Award Shares. 

  

	 	•	 	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.


 Three Year Awarded Shares: 

The target number of Awarded Shares for 100% achievement of the Performance Target for the Three Year Awarded Shares is: 21,935 

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 Section 2 of the Award Agreement) based on achievement of the Performance Target at various levels: 
  

									
	 Actual Performance (millions)
	  	Percentage of Awarded
Shares earned (as a
percentage of the target
number of
Awarded
Shares)	 	 	Number of Earned
Shares	 
	 (minimum threshold) $306.0
	  	 	50	% 	 	 	10,968	  
	 (target) $320.0
	  	 	100	% 	 	 	21,935	  
	 (maximum) $334.0 or higher
	  	 	150	% 	 	 	32,903	  

  

	 	•	 	No shares are earned if actual performance is less than the minimum threshold level. 

  

	 	•	 	The maximum number of Earned Shares is 150% of the target number of Award Shares. 

  

	 	•	 	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. 


  
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