Long-Term Compensation Plan and Stock Based Compensation

9 Months Ended

Sep. 30, 2020

Long-Term Compensation Plan and Stock Based Compensation

Long-Term Compensation Plan and Stock Based Compensation

Note 12 – Long-Term Compensation Plan and Stock Based Compensation (share counts in thousands)

Under the OneSpan Inc. 2019 Omnibus Incentive Plan, we award restricted stock units subject to time-based vesting, restricted stock units which are subject to the achievement of future performance criteria and restricted stock units that are subject to the achievement of market conditions.

We awarded 321 restricted stock units during the nine months ended September 30, 2020, subject to time-based vesting. The fair value of the unissued time-based restricted stock unit grants was $5.7 million at the dates of grant and the grants are being amortized over the vesting periods of one to four years.

We awarded restricted stock unit grants during the nine months ended September 30, 2020, subject to the achievement of market and service conditions, which allow for up to 88 shares to be earned if the market conditions are fully achieved. The fair value of these awards was $1.6 million at the dates of grant and the awards are being amortized over the vesting period of three years.

We awarded restricted stock units subject to the achievement of service and future performance criteria during the nine months ended September 30, 2020, which allow for up to 198 shares to be earned if the performance criteria are fully achieved. The fair value of these awards was $4.1 million at the dates of grant. The Company currently believes that none of these shares will be earned, and the compensation costs recorded through the six months ended June 30, 2020 for these unvested shares issued with performance criteria that are no longer considered probable of achievement have been reversed during the three months ended September 30, 2020.

The Company currently believes that certain restricted stock units subject to the achievement of future performance criteria, awarded during the twelve months ended December 31, 2019 and 2018, will not be earned. The compensation costs recorded for the 8 and 106 unvested shares issued during the twelve months ended December 31, 2019 and 2018, respectively, with performance criteria that are no longer considered probable of achievement have been reversed during the three months ended September 30, 2020.

The following table details long-term compensation plan and stock-based compensation expense for the three and nine months ended September 30, 2020 and 2019:

	Three months ended				Nine months ended
	September 30,				September 30,
	2020		2019		2020		2019
in thousands	(in thousands)				(in thousands)
Restricted stock	$	1,021	$	549	$	3,231	$	1,778
Long-term compensation plan		260		280		930		1,538
Total compensation	$	1,281	$	829	$	4,161	$	3,316