<html>
<head><title>
Prepared and filed by St Ives Financial
</title>
</head>
<body bgcolor="#FFFFFF">
<div style="page-break-before:always"></div>
<page>
<table width="100%" border="0" cellspacing="0" cellpadding="0">
  <tr>
    <td height="4" valign="bottom" bgcolor="#000000"></td>
  </tr>
  <tr>
    <td height="2" valign="top"></td>
  </tr>
  <tr>
    <td height="1" valign="top" bgcolor="#000000"></td>
  </tr>
</table>
<p align="center"><b><font face="serif" size="5">SECURITIES AND EXCHANGE COMMISSION </font></b><br>
<font face="serif" size="3">WASHINGTON, D.C. 20549 </font></p>
<p align="center"><b><font face="serif" size="5">FORM 8-K </font></b></p>
<p align="center"><font size="2" face="serif"><b>CURRENT REPORT <br>
PURSUANT TO SECTION 13 OR 15(d) OF <br>
THE SECURITIES EXCHANGE ACT OF 1934 </b></font></p>
<p align="center"><font size="2" face="serif">Date of Report (Date of earliest event reported): February 21, 2006 </font></p>
<p align="center"><b><font face="serif" size="5">VASCO Data Security International, Inc. </font></b><br>
<font size="2" face="serif">(Exact name of registrant as specified in charter) </font></p>
<table width="100%" border="0" align="center" cellpadding="0" cellspacing="0">
<tr align="center" valign="bottom" bgcolor="#ffffff">
<td><font size="2" face="serif"><b>Delaware</b></font></td>
<td width="5%">&nbsp;</td>
<td width="30%"><font size="2" face="serif"><b>000-24389</b></font></td>
<td width="5%">&nbsp;</td>
<td width="30%"><font size="2" face="serif"><b>36-4169320</b></font></td>
</tr>
<tr align="center" valign="bottom">
<td><hr noshade size="1"></td>
<td>&nbsp;</td>
<td><hr noshade size="1"></td>
<td>&nbsp;</td>
<td><hr noshade size="1"></td>
</tr>
<tr align="center" valign="top" bgcolor="#FFFFFF">
<td><font size="2" face="serif">(State or other juris-</font></td>
<td>&nbsp;</td>
<td><font size="2" face="serif">(Commission</font></td>
<td>&nbsp;</td>
<td><font size="2" face="serif">(IRS Employer</font></td>
</tr>
<tr align="center" valign="top" bgcolor="#FFFFFF">
<td><font size="2" face="serif">diction of incorporation)</font></td>
<td>&nbsp;</td>
<td><font size="2" face="serif">File Number)</font></td>
<td>&nbsp;</td>
<td><font size="2" face="serif">Identification No.)</font></td>
</tr>
</table>
<br>
<table width="100%" border="0" align="center" cellpadding="0" cellspacing="0">
<tr valign="top" bgcolor="#FFFFFF">
<td align="left"><font size="2" face="serif">1901 South Meyers Road, Suite 210</font></td>
<td width="20%" align="right">&nbsp;</td>
<td width="25%" align="center"><font size="2" face="serif">&nbsp;</font></td>
</tr>
<tr valign="top" bgcolor="#ffffff">
<td align="left"><font size="2" face="serif">Oakbrook Terrace, Illinois</font></td>
<td align="right">&nbsp;</td>
<td align="center"><font size="2" face="serif">60181</font></td>
</tr>
<tr valign="top">
<td align="left"><hr noshade size="1"></td>
<td align="right">&nbsp;</td>
<td align="left"><hr noshade size="1"></td>
</tr>
<tr valign="top" bgcolor="#FFFFFF">
<td align="left"><font size="2" face="serif"> (Address of principal executive offices)</font></td>
<td align="right">&nbsp;</td>
<td align="center"><font size="2" face="serif">(Zip Code)</font></td>
</tr>
</table>
<p align="left"><font size="2" face="serif">Registrant's telephone number, including area code:&nbsp;&nbsp;&nbsp;&nbsp;  (630) 932-8844</font></p>  <table width="100%" cellspacing="0" cellpadding="0" border="0">
<tr valign="top">
<td align="center"><font size="2" face="serif">N/A </font></td>
</tr>
<tr valign="top">
<td align="center"><font size="2" face="serif">(Former name or former address, if changed since last report) </font></td>
</tr>
</table>
<p align="left"><font size="2" face="serif">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):</font></p>  <table width="100%" cellspacing="0" cellpadding="0" border="0">
<tr valign="top">
<td align="left" width="5%"><img src="emptybox.gif"></td>
<td align="left"><font size="2" face="serif">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</font></td>
</tr>
<tr valign="top">
<td>&nbsp;</td>
<td>&nbsp;</td> </tr>
<tr valign="top">
<td align="left"><img src="emptybox.gif"></td>
<td align="left"><font size="2" face="serif">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</font></td>
</tr>
<tr valign="top">
<td>&nbsp;</td>
<td>&nbsp;</td> </tr>
<tr valign="top">
<td align="left"><img src="emptybox.gif"></td>
<td align="left"><font size="2" face="serif">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</font></td>
</tr>
<tr valign="top">
<td>&nbsp;</td>
<td>&nbsp;</td> </tr>
<tr valign="top">
<td align="left"><img src="emptybox.gif"></td>
<td align="left"><font size="2" face="serif">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</font></td>
</tr>
</table>
<p align="center">&nbsp;</p>
<table width="100%" border="0" cellspacing="0" cellpadding="0">
  <tr>
    <td height="1" valign="top" bgcolor="#000000"></td>
  </tr>
  <tr>
    <td height="2" valign="top" bgcolor="#FFFFFF"></td>
  </tr>
  <tr>
    <td height="4" valign="bottom" bgcolor="#000000"></td>
  </tr>
</table>
<div style="page-break-before:always"></div>
<page>
<p align="left"><font size="2" face="serif"><b>ITEM 2.02&nbsp;&nbsp; Results of Operations and Financial Condition</b></font></p>
<p align="left"><font size="2" face="serif">On February 21, 2006, VASCO Data Security International, Inc. (VASCO) issued a press release providing a financial update for the fourth quarter and year ended December 31, 2005. The full text of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.   </font></p>
<p align="left"><font size="2" face="serif">On February 21, 2006, VASCO held a conference call with investors to discuss VASCO&#146;s fourth quarter earnings and results of operations for the year ended December 31, 2005.  A script read by officers of VASCO during the conference call is furnished as Exhibit 99.2 to this Current Report on Form 8-K.</font></p>
<p align="left"><font size="2" face="serif">The press release and the comments by VASCO during the conference call contained a non-GAAP financial measure within the meaning of the Securities and Exchange Commission&#146;s Regulation G.&nbsp; For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of a registrant&#146;s historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of income, balance sheet or statement of cash flows (or equivalent statements) of the issuer; or includes amounts, or is subject to adjustments that have
the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented.</font></p>
<p align="left"><font size="2" face="serif">The press release contained a reference
    to EBITDA and provided a reconciliation of EBITDA to net income on the face
    of the Consolidated Statement of Operations. EBITDA, which is earnings before
    interest, taxes, depreciation and amortization, is computed by adding back
    net interest expense, income tax expense, depreciation expense, and amortization
    expense to net income as reported.</font></p>
<p align="left"><font size="2" face="serif">We use EBITDA as a measure of performance,
    a simplified tool for use in communicating our performance to investors and
    analysts and for comparisons to other companies within our industry. As a
    performance measure, we believe that EBITDA presents a view of our operating
    results that is most closely related to serving our customers. By excluding
    interest, taxes, depreciation and amortization we are able to evaluate performance
    without considering decisions that, in most cases, are not directly related
    to meeting our customers requirements and were either made in prior periods
    (e.g., depreciation and amortization), or deal with the structure or financing
    of the business (e.g., interest) or reflect the application of regulations
    that are outside of the control of our management team (e.g., taxes). Similarly,
    we find that the comparison of our results to those of our competitors are
    facilitated when we do not need to consider the impact of those items on
    our competitors&#146; results.</font></p>
<p align="left"><font size="2" face="serif">EBITDA should be considered in addition
    to, but not as a substitute for, other measures of financial performance
    reported in accordance with accounting principles generally accepted in the
    United States. While we believe that EBITDA, as defined above, is useful
    within the context described above, it is in fact incomplete and not a measure
    that should be used to evaluate the full performance of the Company or its
    prospects. Such evaluation needs to consider all of the complexities associated
    with our business including, but not limited to, how past actions are affecting
    current results and they may affect future results, how we have chosen to
    finance the business and how regulations and the other aforementioned items
    affect the final amounts that are or will be available to shareholders as
    a return on their investment. Net income determined in accordance with U.S.
    GAAP is the most complete measure available today to evaluate all elements
    of the our performance. Similarly, our Consolidated Statement of Cash Flows
    provides the full accounting for how we have decided to use resources provided
    to us from our customers, lenders and shareholders.</font></p>
<p align="center"><font size="2" face="serif">2</font></p>
<hr noshade align="center" width="100%" size="2">
<div style="page-break-before:always"></div>
<page>

<p align="left"><font size="2" face="serif"><b>ITEM 9.01&nbsp;&nbsp; Financial Statements and Exhibits</b></font></p>
<table width="100%" cellspacing="0" cellpadding="0" border="0">
<tr valign="top">
<td width="3%"></td>
<td width="6%">
<font size="2" face="serif">(c)</font></td>
<td>
<font size="2" face="serif">Exhibits</font></td>
</tr>
</table>
<table width="100%" cellspacing="0" cellpadding="0" align="center" border="0">
<tr valign="top" bgcolor="#FFFFFF">
  <td align="center">&nbsp;</td>
  <td align="left">&nbsp;</td>
  <td align="right">&nbsp;</td>
  <td align="left">&nbsp;</td>
  <td align="left">&nbsp;</td>
</tr>
<tr valign="top" bgcolor="#FFFFFF">
<td width="9%" align="center"><font size="2" face="serif">Exhibit</font></td>
<td align="left" width="2%">&nbsp;</td>
<td width="1%" align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td width="2%" align="left">&nbsp;</td> </tr>
<tr valign="top" bgcolor="#FFFFFF">
<td align="center"><font size="2" face="serif">Number </font></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">Description</font></td>
<td align="left">&nbsp;</td>
</tr>
<tr valign="top">
<td><hr noshade size="1"></td>
<td></td>
<td></td>
<td><hr align="left" width="100" size="1" noshade></td>
<td></td>
</tr>
<tr valign="top" bgcolor="#ffffff">
<td align="center"><font size="2" face="serif">99.1</font></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">Press release, dated February 21, 2006, providing financial update of VASCO Data Security International, Inc. for the fourth quarter and year ended December 31, 2005.</font></td>
<td align="left">&nbsp;</td>
</tr>
<tr valign="top">
<td align="center"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
</tr>
<tr valign="top" bgcolor="#FFFFFF">
<td align="center"><font size="2" face="serif">99.2</font></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">Text of script for February 21, 2006 Earnings Conference Call.</font></td>
<td align="left">&nbsp;</td>
</tr>
<tr valign="top">
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
</tr>
</table>
<p>&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center"><font size="2" face="serif">3</font></p>
<hr noshade align="center" width="100%" size="2">
<div style="page-break-before:always"></div>
<page>

<p align="center"><font size="2" face="serif"><b>SIGNATURE </b></font></p>
<p align="left"><font size="2" face="serif">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. </font></p>  <table width="100%" cellspacing="0" cellpadding="0" border="0">
<tr valign="top">
<td align="left" width="50%"><font size="2" face="serif">Date: February 21, 2006</font></td>
<td colspan="2" align="left"><font size="2" face="serif">VASCO Data Security International, Inc.</font></td>
</tr>
<tr valign="top">
<td>&nbsp;</td>
<td colspan="2"><hr noshade size="1">
  </td>
</tr>
<tr valign="top">
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td colspan="2" align="left"><font size="2" face="serif">(Registrant)</font></td>
</tr>
<tr valign="top">
<td>&nbsp;</td>
<td width="5%">&nbsp;</td>
<td>&nbsp;</td> </tr>
<tr valign="top">
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td> </tr>
<tr valign="top">
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td> </tr>
<tr valign="top">
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td align="left"><font size="2" face="serif">By:</font></td>
<td align="left"><font size="2" face="serif"> /s/Clifford K. Bown</font></td>
</tr>
<tr valign="top">
<td>&nbsp;</td>
<td>&nbsp;</td>
<td><hr noshade size="1"></td> </tr>
<tr valign="top">
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
<td align="left"><font size="2" face="serif">Clifford K. Bown</font></td>
</tr>
<tr valign="top">
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
<td align="left"><font size="2" face="serif">Chief Financial Officer </font></td>
</tr>
</table>
<p align="center">&nbsp;</p>
<p align="center"><font size="2" face="serif">4</font></p>
<hr noshade align="center" width="100%" size="2">
<div style="page-break-before:always"></div>
<page>
<p align="center"><font size="2" face="serif"><b>EXHIBIT INDEX </b></font></p>
<table width="100%" cellspacing="0" cellpadding="0" align="center" border="0">
<tr valign="top" bgcolor="#FFFFFF">
<td width="9%" align="center"><font size="2" face="serif">Exhibit No</font></td>
<td align="left" width="2%">&nbsp;</td>
<td width="1%" align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">Description</font></td>
<td width="2%" align="left">&nbsp;</td> </tr>
<tr valign="top">
<td align="center"><hr noshade size="1"></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><hr align="left" width="100" size="1" noshade></td>
<td align="left">&nbsp;</td>
</tr>
<tr valign="top" bgcolor="#ffffff">
<td align="center"><font size="2" face="serif">99.1</font></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">Press release, dated February 21, 2006, announcing financial update of VASCO Data Security International, Inc. for the fourth quarter and year ended December 31, 2005.</font></td>
<td align="left">&nbsp;</td>
</tr>
<tr valign="top">
<td align="center"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
</tr>
<tr valign="top" bgcolor="#FFFFFF">
<td align="center"><font size="2" face="serif">99.2</font></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">Text of script for February 21, 2006 Earnings Conference Call.</font></td>
<td align="left">&nbsp;</td>
</tr>
<tr valign="top">
<td align="center"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
<td align="right">&nbsp;</td>
<td align="left"><font size="2" face="serif">&nbsp;</font></td>
<td align="left">&nbsp;</td>
</tr>
</table>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center">&nbsp;</p>
<p align="center"><font size="2" face="serif">5</font></p>
<hr noshade align="center" width="100%" size="2">
</body>
</html>
[{"type": "8-K", "sequence": "1", "filename": "b411963_8k.htm", "description": "CURRENT REPORT", "secsgml_size_bytes": 17105}]
{"company-data": {"conformed-name": "VASCO DATA SECURITY INTERNATIONAL INC", "cik": "0001044777", "assigned-sic": "7373", "irs-number": "364169320", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-24389", "film-number": "06643941"}, "business-address": {"street1": "1901 SOUTH MYERS ROAD", "street2": "SUITE 210", "city": "OAKBROOK TERRACE", "state": "IL", "zip": "60181", "phone": "6309328844"}, "mail-address": {"street1": "1919 S HIGHLAND AVE", "street2": "STE 118 C", "city": "LOMBARD", "state": "IL", "zip": "60148"}}
Prepared and filed by St Ives Financial
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): February 21, 2006
VASCO Data Security International, Inc.
(Exact name of registrant as specified in charter)
Delaware
000-24389
36-4169320
(State or other juris-
(Commission
(IRS Employer
diction of incorporation)
File Number)
Identification No.)
1901 South Meyers Road, Suite 210
Oakbrook Terrace, Illinois
60181
(Address of principal executive offices)
(Zip Code)
Registrant's telephone number, including area code:      (630) 932-8844
N/A
(Former name or former address, if changed since last report)
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):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
ITEM 2.02   Results of Operations and Financial Condition
On February 21, 2006, VASCO Data Security International, Inc. (VASCO) issued a press release providing a financial update for the fourth quarter and year ended December 31, 2005. The full text of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.
On February 21, 2006, VASCO held a conference call with investors to discuss VASCO's fourth quarter earnings and results of operations for the year ended December 31, 2005.  A script read by officers of VASCO during the conference call is furnished as Exhibit 99.2 to this Current Report on Form 8-K.
The press release and the comments by VASCO during the conference call contained a non-GAAP financial measure within the meaning of the Securities and Exchange Commission's Regulation G.  For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of a registrant's historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of income, balance sheet or statement of cash flows (or equivalent statements) of the issuer; or includes amounts, or is subject to adjustments that have
the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented.
The press release contained a reference
    to EBITDA and provided a reconciliation of EBITDA to net income on the face
    of the Consolidated Statement of Operations. EBITDA, which is earnings before
    interest, taxes, depreciation and amortization, is computed by adding back
    net interest expense, income tax expense, depreciation expense, and amortization
    expense to net income as reported.
We use EBITDA as a measure of performance,
    a simplified tool for use in communicating our performance to investors and
    analysts and for comparisons to other companies within our industry. As a
    performance measure, we believe that EBITDA presents a view of our operating
    results that is most closely related to serving our customers. By excluding
    interest, taxes, depreciation and amortization we are able to evaluate performance
    without considering decisions that, in most cases, are not directly related
    to meeting our customers requirements and were either made in prior periods
    (e.g., depreciation and amortization), or deal with the structure or financing
    of the business (e.g., interest) or reflect the application of regulations
    that are outside of the control of our management team (e.g., taxes). Similarly,
    we find that the comparison of our results to those of our competitors are
    facilitated when we do not need to consider the impact of those items on
    our competitors' results.
EBITDA should be considered in addition
    to, but not as a substitute for, other measures of financial performance
    reported in accordance with accounting principles generally accepted in the
    United States. While we believe that EBITDA, as defined above, is useful
    within the context described above, it is in fact incomplete and not a measure
    that should be used to evaluate the full performance of the Company or its
    prospects. Such evaluation needs to consider all of the complexities associated
    with our business including, but not limited to, how past actions are affecting
    current results and they may affect future results, how we have chosen to
    finance the business and how regulations and the other aforementioned items
    affect the final amounts that are or will be available to shareholders as
    a return on their investment. Net income determined in accordance with U.S.
    GAAP is the most complete measure available today to evaluate all elements
    of the our performance. Similarly, our Consolidated Statement of Cash Flows
    provides the full accounting for how we have decided to use resources provided
    to us from our customers, lenders and shareholders.
2
ITEM 9.01   Financial Statements and Exhibits
(c)
Exhibits
Exhibit
Number
Description
99.1
Press release, dated February 21, 2006, providing financial update of VASCO Data Security International, Inc. for the fourth quarter and year ended December 31, 2005.
99.2
Text of script for February 21, 2006 Earnings Conference Call.
3
SIGNATURE
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.
Date: February 21, 2006
VASCO Data Security International, Inc.
(Registrant)
By:
/s/Clifford K. Bown
Clifford K. Bown
Chief Financial Officer
4
EXHIBIT INDEX
Exhibit No
Description
99.1
Press release, dated February 21, 2006, announcing financial update of VASCO Data Security International, Inc. for the fourth quarter and year ended December 31, 2005.
99.2
Text of script for February 21, 2006 Earnings Conference Call.
5