On March 22, 2018, the board of directors of the Company and Fluent, in its capacity as sole stockholder of red violet prior to the Spin-off, approved the Red Violet, Inc. 2018 Stock Incentive Plan (the “2018 Plan”), which became effective immediately prior to the Spin-off. A total of 3,000,000 shares of common stock were authorized to be issued under the 2018 Plan. The primary purpose of the 2018 Plan is to attract, retain, reward and motivate certain individuals by providing them with an opportunity to acquire or increase a proprietary interest in the Company and to incentivize them to expend maximum effort for the growth and success of the Company, so as to strengthen the mutuality of the interests between such individuals and the stockholders of the Company.

As of September 30, 2019, there were 346,791 shares of common stock reserved for issuance under the 2018 Plan.

Details of unvested RSU activity during the nine months ended September 30, 2019 were as follows:

	Number of units			Weighted average grant-date fair value
Unvested as of December 31, 2018 ⁽¹⁾		2,121,000		$	7.65
Granted ⁽¹⁾⁽²⁾		577,000		$	10.12
Vested and delivered		(582,902	)	$	7.63
Withheld as treasury stock⁽³⁾		(103,147	)	$	7.75
Vested not delivered		(12,250	)	$	6.13
Forfeited		(44,791	)	$	7.50
Unvested as of September 30, 2019		1,954,910		$	8.39

(1)

On September 5, 2018 and January 16, 2019, the Company granted an aggregate of 1,487,500 RSUs (included in “Unvested as of December 31, 2018” above) and 90,000 RSUs (included in “Granted” above), respectively, subject to both time- and performance-based requirements, to certain of its employees and directors, at a grant date fair value of $7.69 per share and $7.25 per share, respectively, with a three-year vesting period. Such RSU grants shall not vest unless and until the Company has, for any fiscal quarter in which the RSUs are outstanding, (i) gross revenue determined in accordance with the Company’s reviewed or audited financial statements in excess of $7.0 million for such fiscal quarter, (ii) positive adjusted EBITDA, as determined based on amounts derived from the Company’s reviewed or audited financial statements for such fiscal quarter, and (iii) the participant continues to provide services to the Company either as an employee, director or consultant on the last day of the quarter that the performance criteria are met (collectively, the “2018 Performance Criteria”). Provided the 2018 Performance Criteria are met, the RSUs will vest in accordance with the time-based requirements contained in the award agreement over three years. In the event of a change of control, all RSUs which have not vested on the date of such change of control shall immediately vest even if the 2018 Performance Criteria have not been met. As of June 30, 2019, the Company determined that the 2018 Performance Criteria were met and expects to issue shares underlying the RSUs in accordance with the continuing time-based vesting requirement.

As a result of meeting the 2018 Performance Criteria as of June 30, 2019, the Company recognized a total of $1,075 and $4,489 of share-based compensation expense relating to RSUs with 2018 Performance Criteria during the three and nine months ended September 30, 2019, respectively. Of the $4,489 recognized, $1,309 represented a catch-up of unamortized expense from September 5, 2018 through December 31, 2018, which was not recognized in prior periods because the Company determined at each period end that it was not probable that the 2018 Performance Criteria would be met.

(2)

On August 28, 2019, the Company granted an aggregate of 373,500 RSUs, subject to both time- and performance-based requirements, to certain employees, at a grant date fair value of $11.42 per share, with vesting periods of either three or four years. Such RSU grants shall not vest unless and until the Company has, for any fiscal quarter in which the RSUs are outstanding, (i) gross revenue determined in accordance with the Company’s reviewed or audited financial statements in excess of (a) $10.0 million for such fiscal quarter and positive adjusted EBITDA of at least $1.5 million , as determined based on amounts derived from the Company’s reviewed or audited financial statements for such fiscal quarter for 248,500 RSUs, and (b) $12.5 million for such fiscal quarter and positive adjusted EBITDA of at least $2.0 million, as determined based on amounts derived from the Company’s reviewed or audited financial statements for such fiscal quarter for 125,000 RSUs, and (ii) the participant continues to provide services to the Company either as an employee, director or consultant on the last day of the quarter that the performance criteria is met (collectively, the “2019 Performance Criteria”). Provided the respective 2019 Performance Criteria are met, the RSUs will vest in accordance with the time-based requirements contained in the award agreement over three or four years. In the event of a change of control, all RSUs which have not vested on the date of such change of control shall immediately vest even if the 2019 Performance Criteria have not been met. As of September 30, 2019, the Company determined that it is probable that the 2019 Performance Criteria will be met and therefore, began to record the related amortization expense on the grant date.

As of September 30, 2019, unrecognized share-based compensation expense associated with the granted RSUs amounted to $15,105, which is expected to be recognized over a remaining weighted average period of 2.3 years.

Share-based compensation was allocated to the following accounts in the condensed consolidated financial statements for the three and nine months ended September 30, 2019 and 2018:

	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2019		2018		2019		2018
Sales and marketing expenses	$	114	$	54	$	290	$	95
General and administrative expenses		1,293		164		5,000		337
Share-based compensation expense		1,407		218		5,290		432
Capitalized in intangible assets		208		135		526		316
Total	$	1,615	$	353	$	5,816	$	748

The amounts recorded in the nine months ended September 30, 2018 included an allocation of share-based compensation related to the share-based awards granted by Fluent to Company employees or non-employees prior to the Spin-off.