NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 1 – Description of the activity
Criteo S.A. is a société anonyme or S.A, under the laws of the French Republic. The headquarters are located at 32 rue Blanche, 75009 Paris. The Company is registered on Registre du Commerce (Trade and Companies Registry) in Paris under no. 484 786 249 RCS Paris.
Criteo is a global technology company powering the world's marketers with trusted and impactful advertising. Criteo enables brands' and retailers' growth by activating commerce data through artificial intelligence ("AI") technology, reaching consumers on an extensive scale across all stages of the consumer journey, and generating advertising revenues from consumer brands for large retailers.
The preparation of the Consolidated Financial Statements as of December 31, 2019 are under the responsibility of Criteo S.A.’s management. The Consolidated Financial Statements were authorized for issuance by the board of directors of Criteo S.A. on February 25, 2021 and will be approved at the General Meeting on June 15, 2021.
All amounts are expressed in thousands of euros, unless stated otherwise.
In these notes, Criteo S.A. is referred to as the Parent company and together with its subsidiaries, collectively, as "Criteo," the Company "or" the Group".
Note 2 – Basis of preparation
The Consolidated Financial Statements have been prepared using a going concern assumption and the historical cost principle with the exception of certain assets and liabilities that are measured at fair value in accordance with IFRS. The categories concerned are detailed in the following notes.
In application of the 1606/2002 regulation adopted by the European Parliament and the European Council, the Consolidated Financial Statements have been prepared in accordance with the International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standard Board (“IASB”) and endorsed by the European Union and whose application is mandatory for the year ending December 31, 2020. Furthermore, regarding its mandatory compliance as a Nasdaq listed company and under the Securities Exchange Act of 1934, the Group publishes consolidated financial statements in accordance with the applicable accounting standards in the United States.
The set of texts adopted by the European Union is available on the web site of the European Commission: http://ec.europa.eu/internal_market/accounting/ias/index_fr.htm.
Standards and amendments applicable from January 1, 2020
The following new standards and amendments have been adopted by Criteo on January 1, 2020 but have had no impact on the Company’s consolidated financial statements as of December 31, 2020:
•Amendments to References to the Conceptual Framework in IFRS Standards
•Amendments to IAS 1 and IAS 8, addition of the definition of materiality
•Amendments to IFRS 3, Definition of a business
•Amendments to IFRS 9, IAS 39 and IFRS 7, interest rate benchmark reform
Standards and amendments to be adopted but not yet applicable as of December 31, 2020
•None
Note 3 – Principles and accounting methods
Consolidation Methods
The Group has control over all its subsidiaries, and consequently they are all fully consolidated. The table below presents at each period’s end and for all entities included in the consolidation scope the following information:
•Country of incorporation; and
•Percentage of voting rights and ownership interests
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Country
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December 31, 2018
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December 31, 2019
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December 31, 2020
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Consolidation
method
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Voting
rights
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Ownership
interest
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Voting
rights
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Ownership
interest
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Voting
rights
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Ownership
interest
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French subsidiaries
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Criteo S.A.
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France
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100%
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100%
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100%
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100%
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100%
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100%
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Parent Company
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Criteo France S.A.S.
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France
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Criteo Finance S.A.S.
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France
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Storetail Marketing Services S.A.S. (*)
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France
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100%
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100%
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100%
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100%
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—%
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—%
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N/A
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Condigolabs S.A.S.
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France
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—%
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—%
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100%
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40%
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100%
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40%
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Fully consolidated
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Foreign subsidiaries
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Criteo Ltd.
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United Kingdom
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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HookLogic Ltd. (**)
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United Kingdom
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100%
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100%
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—%
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—%
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—%
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—%
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N/A
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Storetail Marketing Services LTD
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United Kingdom
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100%
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100%
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100%
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100%
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—%
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—%
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N/A
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Criteo Corp.
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United States
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Manage Inc. (***)
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United States
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100%
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100%
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100%
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100%
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—%
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—%
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N/A
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Criteo GmbH
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Germany
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Criteo Nordics AB. (*)
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Sweden
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—%
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—%
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100%
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100%
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100%
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100%
|
Fully consolidated
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Criteo Korea Ltd. (*)
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Korea
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—%
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—%
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100%
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100%
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100%
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100%
|
Fully consolidated
|
Criteo K.K.
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Japan
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66%
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66%
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66%
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66%
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66%
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66%
|
Fully consolidated
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Criteo Do Brasil Desenvolvimento De Serviços De Internet Ltda.
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Brazil
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Criteo B.V.
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The Netherlands
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Criteo Australia Pty Ltd.
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Australia
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Criteo S.R.L.
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Italy
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Criteo Advertising (Beijing) Co.Ltd
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China
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Criteo Singapore Pte.Ltd
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Singapore
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100%
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100%
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100%
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100%
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100%
|
100%
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Fully consolidated
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Criteo LLC
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Russia
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100%
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100%
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100%
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100%
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100%
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100%
|
Fully consolidated
|
Criteo Europa MM, S.L.
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Spain
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
|
Criteo Espana, S.L.
|
Spain
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Storetail Marketing Services S.L.U (****)
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Spain
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100%
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100%
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100%
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100%
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—%
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—%
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N/A
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Criteo Canada Corp.
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Canada
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Criteo Reklamcilik Hzimetleri ve Ticaret A.S.
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Turkey
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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Criteo MEA FZ-LLC
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United Arab Emirates
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100%
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100%
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100%
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100%
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100%
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100%
|
Fully consolidated
|
Criteo India Private Limited
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India
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100%
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100%
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100%
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100%
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100%
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100%
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Fully consolidated
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(*) merged with Criteo S.A..
(**) merged with Criteo Ltd.
(***) merged with Criteo Corp.
(****) merged with Criteo Espana S.L.
Business combinations
The acquisition method is used in accounting for business combinations. The consideration transferred to obtain control of a subsidiary is calculated as the sum of the acquisition-date fair values of assets transferred, liabilities incurred and the equity interests issued by the Company, which includes the fair value of any asset or liability arising from a contingent consideration arrangement.
Acquisition costs are expensed as incurred.
Identifiable assets acquired and liabilities assumed are recognized in a business combination regardless of whether they have been previously recognized in the acquiree’s financial statements prior to the acquisition. Assets acquired and liabilities assumed are generally measured at their acquisition date fair values.
Goodwill is determined after a separate recognition of identifiable intangible assets. It is calculated as the excess of the fair value of the consideration transferred over the sum of the recognized amount of any non-controlling interest in the acquiree and the acquisition date fair values of identifiable net assets.
When the cost of the acquisition is below the fair value of the Company’s share in the assets, liabilities and contingent liabilities of the acquiree, the difference is recognized directly in the income statement.
If the initial accounting for a business combination can only be determined provisionally, provisional values of the assets and liabilities should be adjusted within one year from the acquisition date, in accordance with IFRS 3.
The impact of capital gains or losses and of depreciation charges and reversals recognized after 12 months of the acquisition date in relation to the values assigned to assets acquired and liabilities assumed at the time of the first consolidation is recognized prospectively, as the income of the period of change and future periods, if any, without adjusting goodwill except in the case of the correction of an error, in accordance with IAS 8—Accounting policies, changes in accounting estimates and errors.
Intangible Assets (Excluding Goodwill)
Acquired intangible assets are accounted for at acquisition cost, less accumulated amortization and any impairment loss. Acquired intangible assets are primarily composed of software, technologies and customer relationships, amortized on a straight-line basis over their estimated useful lives comprised between one and three years for software, and between three and nine years for technologies and customer relationships. Intangible assets are reviewed for impairment whenever there are events or changes in circumstances such as, but not limited to, significant declines in revenue, earnings or cash flows or material adverse changes in the business climate, that indicate that the carrying amount of an asset may be impaired.
Costs related to customized internal-use software that have reached the development stage are capitalized. Capitalization of such costs begins when the preliminary project stage is complete and stops when the project is substantially complete and is ready for its intended purpose. In making this determination, several analysis for each phase were performed, including analysis of the feasibility, availability of resources, intention to use and future economic benefits. Amortization of these costs begins when assets are placed in service and is calculated on a straight-line basis over the assets’ useful lives estimated between three to five years.
The research and development efforts are focused on enhancing the performance of our solution and improving the efficiency of the services the Group delivers to clients. All development costs, principally headcount-related costs, are expensed as incurred as management has determined that technological feasibility is reached shortly before the product is available for release to customers.
Property, Plant and Equipment
Property, plant and equipment are accounted for at acquisition cost less cumulative depreciation and any impairment loss. Depreciation is calculated on a straight-line basis over the assets’ estimated useful lives as follows:
•Servers........................................................................5 years over the life of the warranty
•Furniture and IT equipment.............................................................................. 3 to 5 years
Leasehold improvements are depreciated over their useful life or over the lease term, whichever is shorter.
The gains and losses on disposal of assets are determined by comparing selling price with the net book value of the disposed asset. Residual values and the duration of assets’ useful lives are revised and, if applicable, adjusted at each closing date for each reporting period.
Impairment of Assets
Goodwill, Intangible Assets, Property, plant and equipment
In accordance with IAS 36—Impairment of Assets, whenever events or changes in market conditions indicate a risk of impairment of intangible assets, property, plant and equipment, a detailed review is carried out in order to determine whether the net carrying amount of such assets remains lower than their recoverable amount, which is defined as the greater of fair value (less costs to sell) and value in use. Value in use is measured by discounting the expected future cash flows from continuing use of the asset and its ultimate disposal. Goodwill is tested once a year for impairment following the principle that the Group operates as a single reporting unit and has selected December 31 as the date to perform its annual impairment test.
In the event that the recoverable value is lower than the net carrying value, the difference is recognized as an impairment loss. Impairment losses for property, plant and equipment or intangible assets with finite useful lives can be reversed if the recoverable value becomes higher than the net carrying value (but not exceeding the loss initially recorded).
There has been no impairment of goodwill during the years ended December 31, 2018, 2019 and 2020, as the Company's reporting unit's fair value was in excess of the carrying value based on the annual goodwill impairment test.
Leases
In accordance with the provisions of IFRS 16, when entering into a rental agreement, the Group recognizes a liability on the balance sheet corresponding to future discounted payments of the fixed part of the rents, as well as a right of use asset amortized over the term of the contract
Office space and data centers are rented under non-cancellable operating lease agreements. These leases typically include rent free periods, rent escalation periods, renewal options and may also include leasehold improvement incentives. Both office and data center leases may contain non-lease components such as maintenance, electrical costs, and other service charges. Non-lease components are accounted for separately.
Operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. Options have been included in the calculation if management has determined that it is reasonably certain that the option will be exercised. Lease liabilities or right of use asset for leases with a term of 12 months or less and/or low values are not recognized.
Financial Assets and Liabilities, Excluding Derivatives Financial Instruments
Financial assets, excluding cash, consist exclusively of loans and receivables. Loans and receivables are non-derivative financial assets with a payment, which is fixed or can be determined, not listed on an active market. They are included in current assets, except those that mature more than twelve months after the reporting date.
Loans are measured at amortized cost using the effective interest method. The recoverable amount of loans and advances is estimated whenever there is an indication that the asset may be impaired and at least on each reporting date. If the recoverable amount is lower than the carrying amount, an impairment loss is recognized in the Consolidated Statement of Income.
The Group carries the accounts receivable at original invoiced amount less an allowance for any potential uncollectible amounts . Management makes estimates of expected credit trends for the allowance for credit losses based on, among other factors, a past history of collections, current credit conditions, the aging of the receivables, past history of write downs, credit quality of our customers, current economic conditions, and reasonable and supportable forecasts of future economic conditions.
A receivable is considered past due if we have not received payments based on agreed-upon terms.
A higher default rate than estimated or a deterioration in our clients’ creditworthiness could have an adverse impact on our future results. Allowances for credit losses on trade receivables are recorded in “sales and operations expenses” in our Consolidated Statements of Income. We generally do not require any security or collateral to support our receivables.
Financial liabilities are initially recorded at their fair value at the transaction date. Subsequently they are measured at amortized cost using the effective interest method.
Derivatives Financial Instruments
The Group buys and sells derivative financial instruments in order to manage and reduce the exposure to the risk of exchange rate fluctuations. The Group deals only with first-class financial institutions. Under IAS 39, financial instruments may only be classified as hedges when the effectiveness of the hedging relationship at inception and throughout the life of the hedge can be demonstrated and documented. Derivatives not designated as hedging instruments mainly consist of put, forward buying and selling contracts that we use to hedge intercompany transactions and other monetary assets or liabilities denominated in currencies other than the local currency of a subsidiary. We recognize gains and losses on these contracts, as well as the related costs in the financial income (expense), net, along with the foreign currency gains and losses on monetary assets and liabilities.
In accordance with amendment to IFRS 7—Financial instruments: Disclosures, financial instruments are presented in three categories based on a hierarchical method used to determine their fair value:
•Level 1: fair value calculated using quoted prices in an active market for identical assets and liabilities;
•Level 2: fair value calculated using valuation techniques based on observable market data such as prices of similar assets and liabilities or parameters quoted in an active market;
•Level 3: fair value calculated using valuation techniques based wholly or partially on unobservable inputs such as prices in an active market or a valuation based on multiples for unlisted companies.
Cash and cash equivalents and Marketable securities
Cash includes cash on deposit with banks and highly liquid investments such as demand deposits with banks. Cash equivalents include short-term, highly liquid investments, with a remaining maturity at the date of purchase of three months or less for which the risk of changes in value is considered to be insignificant. Highly liquid demand deposits therefore meet the definition of cash equivalents.
Criteo holds investments in marketable securities, consisting mainly of term deposits with banks, not meeting the cash equivalents definition, presented as non current assets. Criteo accounts for marketable securities using the amortized cost model as Criteo’s objective is to collect contractual cash flows that are solely made up of payments of principal and interests. Interest income generated from these investments are recorded as financial income.
Employee Benefits
Depending on the laws and practices of the countries in which the Group operates, employees may be entitled to compensation when they retire or to a pension following their retirement. For state-managed plans and other defined contribution plans, we recognize them as expenses when they become payable, our commitment being limited to our contributions.
In accordance with IAS 19, the liability with respect to defined benefit plans is estimated using the projected unit credit method. Under this method, each period of service gives rise to an additional unit of benefit entitlement and each unit is valued separately to obtain the final obligation. The final amount of the liability is then discounted.
The main assumptions used to calculate the liability are:
•discount rate;
•future salary increases; and
•employee turnover.
Service costs are recognized in the income statement and are allocated by function.
Finance costs are presented as part of “Financial income (expense)” in the Consolidated Statement of Income.
Actuarial gains and losses are recognized in other comprehensive income. Actuarial gains and losses arise as a result of changes in actuarial assumptions or experience adjustments (differences between the previous actuarial assumptions and what has actually occurred).
Provisions
The Group recognizes provisions in accordance with IAS 37—Provisions, Contingent Liabilities and Contingent Assets, if the following three conditions are met:
•the Group has a present obligation (legal or constructive) towards a third-party that arises from an event prior to the closing date;
•it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation;
•and the obligation amount can be estimated reliably.
With respect to litigation and claims that may result in a provision to be recognized, the Group exercises significant judgment in measuring and recognizing provisions or determining exposure to contingent liabilities that are related to pending litigation or other outstanding claims. These judgment and estimates are subject to change as new information becomes available.
Revenue recognition
We sell personalized display advertisements featuring product-level recommendations either directly to clients or to advertising agencies. Historically, the Criteo model has focused solely on converting our clients' website visitors into customers, enabling us to charge our clients only when users engage with an ad we deliver, usually by clicking on it. More recently, we have expanded our solutions to address a broader range of marketing goals for our clients.
We offer two families of solutions to our commerce and brand clients:
•Criteo Marketing Solutions allow commerce companies to address multiple marketing goals by engaging their consumers with personalized ads across the web, mobile and offline store environments.
•Criteo Retail Media solutions allow retailers to generate advertising revenues from consumer brands, and/or to drive sales for themselves, by monetizing their data and audiences through personalized ads, either on their own digital property or on the open Internet, that address multiple marketing goals.
We also have multiple pricing models which now include cost plus margin models in addition to cost-per-click, cost-per-install and cost-per-impression pricing models.
We recognize revenues when we transfer control of promised services directly to our clients or to advertising agencies, which we collectively refer to as our clients, in an amount that reflects the consideration to which we expect to be entitled to in exchange for those services.
For campaigns priced on a cost-per-click, cost-per-install basis and cost plus margin basis, we bill our clients when a user clicks on an advertisement we deliver or installs an application by clicking on an advertisement we delivered, respectively. For these pricing models, we recognize revenue when a user clicks on an advertisement or installs an application.
For campaigns priced on a cost-per-impression basis, we bill our clients based on the number of times an advertisement is displayed to a user. For this pricing model, we recognize revenue when an advertisement is displayed.
For campaigns with a fixed pricing component, where fixed amounts are billed to the customer at various intervals, we recognize revenue on a ratable basis, based on our completion of our performance obligation to the customer.
We mainly act as principal in our arrangements because (i) we control the advertising inventory before it is transferred to our clients; (ii) we bear sole responsibility for fulfillment of the advertising promise and inventory risks and (iii) we have full discretion in establishing prices. Therefore, based on these factors, we report revenue earned and the related costs incurred on a gross basis.
Practical expedients
We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.
We generally expense sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within sales and operating expenses.
Cost of revenue
The cost of revenue primarily includes traffic acquisition costs and other cost of revenue.
Traffic Acquisition Costs. Traffic acquisition costs consist primarily of purchases of impressions from publishers on a CPM basis. The Group purchases impressions directly from publishers or third-party intermediaries, such as advertisement exchanges. It recognizes cost of revenue on a publisher by publisher basis as incurred. Costs owed to publishers but not yet paid are recorded in our Consolidated Statement of Financial Position as accounts payable.
Other Cost of Revenue. Other cost of revenue includes expenses related to third-party hosting fees, depreciation of data center equipment, data purchased from third parties and digital taxes.
For some solutions within Criteo Retail Media, the Group pays for the inventory of our ecommerce retailer partners on a revenue sharing basis, effectively paying the retailers a portion of the click-based revenue generated by user clicks on the sponsored products advertisements displaying the products of our brand manufacturer clients.
Share-Based Compensation
Shares, employee share options and warrants are exclusively awarded to our employees or directors. As required by IFRS 2—Share-Based Payment (“IFRS 2”), these awards are measured at their fair value on the date of grant. The fair value is calculated with the most relevant formula regarding the settlement and the conditions of each plan.
The fair value is recorded in personnel expenses (allocated by function in the Consolidated Statement of Income) on a straight line basis over each milestone composing the vesting period with a corresponding increase in shareholders’ equity.
At each closing date, the Group re-examines the number of options likely to become exercisable. If applicable, the impact of the review of the estimate is recognized in the Consolidated Statement of Income with a corresponding adjustment in equity.
Income Taxes
The Group elected to classify the French business tax, Cotisation sur la Valeur Ajoutée des Entreprises (“CVAE”), as an income tax in compliance with IAS 12—Income Taxes (“IAS 12”).
The French Research Tax Credit, Crédit d’Impôt Recherche (“CIR”), is a French tax incentive to stimulate research and development (“R&D”). Generally, the CIR offsets the income tax to be paid and the remaining portion (if any) can be refunded at the end of a three-fiscal year-period. The CIR is calculated based on the claimed volume of eligible R&D expenditures by us. As a result, the CIR is presented as a deduction to “Research and development expenses” in the Consolidated Statement of Income. The Group has exclusively claimed R&D performed in France for purposes of the CIR.
The U.S Research Tax Credit is a U.S. tax credit to incentivize research and development activities in the U.S. Qualifying R&D expenses generating a tax credit which may be used to offset future taxable income once all net operating losses and foreign tax credits have been used. It is not refundable and as such, considered in the scope of IAS 12 as a component of income tax expenses. We have exclusively claimed R&D performed in the U.S. for purposes of the U.S. Research Tax Credit.
Deferred taxes are recorded on all temporary differences between the financial reporting and tax bases of assets and liabilities, and on tax losses, using the liability method. Differences are defined as temporary when they are expected to reverse within a foreseeable future. Only deferred tax assets may be recognized if, based on the projected taxable incomes within the next three years; the Group determines that it is probable that future taxable profit will be available against which the unused tax losses and tax credits can be utilized. This determination requires many estimates and judgments by the management for which the ultimate tax determination may be uncertain. If future taxable profits are considerably different from those forecasted that support recording deferred tax assets, the amount of deferred tax assets will be revised downwards or upwards, which would have a significant impact on the net income.
In accordance with IAS 12, tax assets and liabilities are not discounted. Amounts recognized in the Consolidated Financial Statement are calculated at the level of each tax entity included in the consolidation scope.
Operating Segments
In accordance with IFRS 8—Operating Segments, segment information reported is built on the basis of internal management data used for performance analysis of businesses and for the allocation of resources. An operating segment is a distinct component of the Company which is engaged in the supply of distinct products and services and which is exposed to risks and returns different from the risks and the returns of other operating segments.
The chief operating decision-maker is the Chief Executive Officer (“CEO”). The CEO reviews consolidated data for revenue, revenue excluding traffic acquisition costs (Revenue ex-TAC) and Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, share-based compensation, service costs (pension), restructuring costs and acquisition-related costs and deferred price consideration) for the purposes of allocating resources and evaluating financial performance.
The Group has concluded that its operations constitute one operating and reportable segment.
Use of Estimates
The Consolidated Financial Statements are prepared in accordance with IFRS. The preparation of the Consolidated Financial Statements requires management to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenue and expenses. The Group bases its estimates and assumptions on historical experience and other factors that it believes to be reasonable under the circumstances. The Group evaluates the estimates and assumptions on an ongoing basis. The actual results may differ from these estimates.
The most significant areas that require management judgment and estimates relate to (1) the recognition of revenue; (2) allowances for credit losses; (3) the research tax credits; (4) the income taxes including (i) the recognition of the deferred tax assets considering the subsidiaries projected taxable profit for future years (ii) the evaluation of uncertain tax positions considering our transfer pricing policies and (iii) the recognition of income tax positions considering the tax reform recently enacted in countries we operate; (5) assumptions used in valuing acquired assets and assumed liabilities in business combinations, (6) assumptions used in the valuation of goodwill, intangible assets and leases, and (7) assumptions used in the valuation model to determine the fair value of share-based compensation plan.
The severity, magnitude, duration and after effects of the COVID-19 pandemic on the general economic conditions increase uncertainty associated with these estimates, in particular those related to allowance for credit losses, assumptions used in the valuation of goodwill and estimates relating to income taxes.
Earnings Per Share
In accordance with IAS 33—Earnings Per Share, basic earnings per share (“EPS”) are calculated by dividing the net income attributable to shareholders of the Parent company by the weighted average number of shares outstanding. The weighted average number of shares outstanding is calculated according to movements in share capital.
In addition, diluted earnings per share is calculated by dividing the net income attributable to shareholders of the Parent company by the weighted average number of shares outstanding plus any potentially dilutive shares not yet issued.
Note 4 – Significant Events and Transactions of the Period
Share repurchase program
On October 25, 2018 Criteo's Board of Directors authorized a share repurchase program of up to $80.0 million (€70.5 million) of the Company’s outstanding American Depositary Shares. As of December 31, 2018, 3.5 million shares were held as treasury shares. We completed this share repurchase program in 2018.
On February 8, 2019, the Board of Directors authorized the reduction of capital resulting in the formal retirement of 1.6 million treasury shares.
On July 26, 2019, Criteo's Board of Directors authorized a share repurchase program of up to $80.0 million (€71.4 million) of the Company's outstanding American Depositary Shares. As of December 31, 2019, 3.2 million shares were held as treasury shares as part of the share repurchase program authorized on July 26, 2019. We completed this share repurchase program in February 2020.
As of December 31, 2019, we had 3.9 million treasury shares remaining which may be used to satisfy the company's obligations under its employee equity plans upon RSU vesting in lieu of issuing new shares, and for M&A activity.
On April 23, 2020, Criteo's Board of Directors authorized a share repurchase program of up to $30.0 million (€26.3 million) of the Company's outstanding American Depositary Shares. We completed this share repurchase program in July 2020.
As of December 31, 2020 we had 5.6 million treasury shares remaining which may be used to satisfy the Company's obligations under its employee equity plan upon RSU vesting in place of issuing new shares, and for any potential M&A activity.
|
|
|
|
|
|
|
|
|
|
Number of Treasury Shares
|
Amount
(in thousands of euros)
|
Balance at December 31, 2018
|
3,459,119
|
|
69,741
|
|
Cancellation of treasury shares - Business combinations
|
(1,594,288)
|
|
(31,819)
|
|
Treasury Shares Repurchased to potentially use for M&A
|
1,498,709
|
|
25,740
|
|
Treasury Shares Repurchased for RSU Vesting
|
1,743,223
|
|
27,217
|
|
Treasury Shares Issued 2019 RSU Vesting
|
(1,203,090)
|
|
(24,328)
|
|
Balance at December 31, 2019
|
3,903,673
|
|
66,551
|
|
Treasury Shares Repurchased for RSU Vesting
|
3,358,068
|
|
39,208
|
|
Treasury Shares Issued for 2020 RSU Vesting
|
(1,472,346)
|
|
(25,825)
|
|
Treasury Shares Issued for M&A
|
(156,859)
|
|
(3,562)
|
|
Balance at December 31, 2020
|
5,632,536
|
|
76,372
|
|
Cessation of our R&D operations in Palo Alto
On October 7, 2019, in connection with the new organization structure, the Company announced a plan to restructure its R&D activities with the closing of its R&D operations in Palo Alto. The Company incurred net restructuring costs of €0.6 million (2019 : €0.6 million), classified as part of research and development expenses in the consolidated statement of income. The amount recognized as current liabilities in the Consolidated Balance Sheet is €0.2 million (2019 : €5.0 million).
Termination of the Palo Alto Lease
During the year ended December 31, 2020, we early terminated the Palo Alto lease, originally expiring in 2027. We incurred broker fees and termination penalties of €4.0 million in connection with this transaction. The net impact of write-offs of the right of use assets, lease liabilities, and fixed assets associated with the lease was nil. For the twelve months ended December 31, 2020, €1.3 million was included in Research and Development expenses, €0.7 million was included in General and Administrative expenses and €2.0 million was included in Sales and Operations expenses.
New organization structure
As part of a new organization structure designed to best support its multi-product platform strategy and accelerate execution, the Company incurred net restructuring costs of €2.3 million (2019 : €0.6 million), mainly compromised of payroll expenses of €4.6 million, and offset by gains from forfeitures of equity instruments linked to share-based compensation of €2.3 million. This restructuring costs were allocated between Research and Development expenses (€0.1 million), Sales and Operations expenses (€1.8 million) and General and Administrative expenses (€0.4 million). The amount recorded as current liabilities on the consolidated balance sheet is €1.7 million (2019 : €0.5 million).
Changes in Group funding
In September 2015, Criteo S.A. entered into a Multicurrency Revolving Facility Agreement for general purposes of the Group including the funding of business combinations. On May 4, 2020, Criteo decided to draw preventively €140 million under its RCF credit facility for general purposes. This six month drawdown of €140 million was fully reimbursed on November 4, 2020. In addition, the parties to the RCF agreement have agreed to extend the term of the agreement for one additional year, from March 2022 to March 2023, composed of a €350 million commitment through March 2022, and a €294 million commitment from the end of March 2022 through March 2023.
Changes in Group financial investments
In June 2020, a €20.0 million amount was invested in a 24 months term deposit with an annual yield of 0.25%. This investment has been classified as Marketable Securities as it does not meet the cash and cash equivalent criteria, presented as non current assets.
In September 2020, a $20.0 million ( €16.3 million) amount has been invested into a 12 months term deposit with an annual yield of 0.75%. This new investment is classified as Cash and Cash Equivalents.
In December 2020, a $5.0 million (€4.1 million) amount has been invested in a 24 months term deposit with an annual yield of 0.60% and a €10.0 million amount has been invested in a 15 months term deposit with an annual yield of 0.50%. These investments have been classified as Marketable Securities as they do not meet the cash and cash equivalent criteria, presented as non current assets.
Note 5 – Financial risk management
Credit risk
The maximum exposure to credit risk at the end of each reported period is represented by the carrying amount of financial assets and summarized in the following table:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Marketable securities
|
|
|
|
—
|
|
—
|
|
34,075
|
|
Non-current financial assets
|
|
|
|
17,869
|
|
19,358
|
|
14,754
|
|
Trade receivables
|
|
|
|
413,887
|
|
425,640
|
|
386,321
|
|
Other current assets
|
|
|
|
66,002
|
|
69,139
|
|
73,466
|
|
Cash and cash equivalents
|
|
|
|
318,276
|
|
372,751
|
|
397,784
|
|
Total
|
|
|
|
816,034
|
|
886,888
|
|
906,400
|
|
Trade receivables
Credit risk is defined as an unexpected loss in cash and earnings if the client is unable to pay its obligations in due time. The Group performs internal ongoing credit risk evaluations of the clients. When a possible risk exposure is identified, the Group requires prepayments.
For each period presented, the aging of trade receivables and provisions for credit losses is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Value
|
%
|
Provision
|
%
|
Gross Value
|
%
|
Provision
|
%
|
Gross Value
|
%
|
Provision
|
%
|
Not yet due
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
276,435
|
|
63
|
%
|
(224)
|
|
1
|
%
|
297,763
|
|
67
|
%
|
(2,175)
|
|
12
|
%
|
272,431
|
|
65
|
%
|
(1,088)
|
|
3
|
%
|
0-30 days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100,210
|
|
23
|
%
|
(549)
|
|
2
|
%
|
85,721
|
|
19
|
%
|
(1,767)
|
|
10
|
%
|
70,785
|
|
17
|
%
|
(712)
|
|
2
|
%
|
31-60 days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,156
|
|
4
|
%
|
(1,028)
|
|
5
|
%
|
20,035
|
|
5
|
%
|
(180)
|
|
1
|
%
|
24,333
|
|
6
|
%
|
(141)
|
|
—
|
%
|
60-90 days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,944
|
|
2
|
%
|
(1,091)
|
|
5
|
%
|
9,286
|
|
2
|
%
|
(178)
|
|
1
|
%
|
7,551
|
|
2
|
%
|
(46)
|
|
—
|
%
|
> 90 days
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32,779
|
|
8
|
%
|
(19,745)
|
|
87
|
%
|
30,300
|
|
7
|
%
|
(13,165)
|
|
75
|
%
|
43,748
|
|
10
|
%
|
(30,540)
|
|
94
|
%
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
436,524
|
|
100
|
%
|
(22,637)
|
|
100
|
%
|
443,105
|
|
100
|
%
|
(17,465)
|
|
100
|
%
|
418,848
|
|
100
|
%
|
(32,527)
|
|
100
|
%
|
Cash and Cash Equivalents and Marketable securities
Cash and cash equivalents and marketable securities are exclusively invested in secure investments such as interest-bearing term deposits.
Market Risk
Foreign Currency Risk
A 10% increase or decrease of the Pound Sterling, the U.S dollar, the Japanese yen or the Brazilian real against the euro would have impacted the Consolidated Statement of Income in Equity including non-controlling interests as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GBP/EUR
|
|
|
|
|
|
|
10%
|
(10)%
|
10%
|
(10)%
|
10%
|
(10)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income impact
|
|
|
|
|
|
|
(665)
|
665
|
(359)
|
359
|
115
|
(115)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD/EUR
|
|
|
|
|
|
|
10%
|
(10)%
|
10%
|
(10)%
|
10%
|
(10)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income impact
|
|
|
|
|
|
|
(2,906)
|
2,906
|
(2,224)
|
2,224
|
(3,404)
|
3,404
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
JPY/EUR
|
|
|
|
|
|
|
10%
|
(10)%
|
10%
|
(10)%
|
10%
|
(10)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income impact
|
|
|
|
|
|
|
1,190
|
(1,190)
|
897
|
(897)
|
525
|
(525)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BRL/EUR
|
|
|
|
|
|
|
10%
|
(10)%
|
10%
|
(10)%
|
10%
|
(10)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income impact
|
|
|
|
|
|
|
(545)
|
545
|
(81)
|
81
|
(40)
|
40
|
Counter Party Risk
As of December 31, 2020, we show a positive net cash position. Since 2012, we utilize a cash pooling arrangement, reinforcing cash management centralization. Investment and financing decisions are carried out by our internal central treasury function. We only deal with counterparties with high credit ratings. In addition, under our Investment and Risk Management Policy, our central treasury function ensures a balanced distribution between counterparties of the investments, no matter the rating of such counterparty.
Liquidity Risk
The following tables disclose for each presented period the contractual cash flows of our financial liabilities and operating lease arrangements :
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018
|
(In thousands of euros)
|
Carrying
value
|
Contractual cash flows
|
Less than 1 year
|
1 to 5 years
|
5 years +
|
|
Financial liabilities
|
3,063
|
|
3,163
|
|
938
|
|
2,225
|
|
—
|
|
Operating lease liabilities
|
—
|
|
207,098
|
|
82,046
|
|
101,061
|
|
23,991
|
|
Trade payables
|
371,508
|
|
371,508
|
|
371,508
|
|
—
|
|
—
|
|
Other current liabilities
|
146,119
|
|
146,119
|
|
146,119
|
|
—
|
|
—
|
|
Total
|
520,690
|
|
727,888
|
|
600,611
|
|
103,286
|
|
23,991
|
|
|
|
|
|
|
|
|
December 31, 2019
|
(In thousands of euros)
|
Carrying
value
|
Contractual cash flows
|
Less than 1 year
|
1 to 5 years
|
5 years +
|
|
Financial liabilities
|
3,920
|
|
2,828
|
|
1,867
|
|
961
|
|
—
|
|
Operating lease liabilities
|
—
|
|
147,206
|
|
40,876
|
|
106,330
|
|
—
|
|
Trade payables
|
347,564
|
|
347,564
|
|
347,564
|
|
—
|
|
—
|
|
Other current liabilities
|
141,985
|
|
141,985
|
|
141,985
|
|
—
|
|
—
|
|
Total
|
493,469
|
|
639,583
|
|
532,292
|
|
107,291
|
|
—
|
|
|
|
|
|
|
|
|
December 31, 2020
|
(In thousands of euros)
|
Carrying
value
|
Contractual cash flows
|
Less than 1 year
|
1 to 5 years
|
5 years +
|
|
Financial liabilities
|
2,669
|
|
2,683
|
|
2,368
|
|
315
|
|
—
|
|
Operating lease liabilities
|
—
|
|
—
|
|
40,328
|
|
68,011
|
|
—
|
|
Trade payables
|
299,372
|
|
299,372
|
|
299,372
|
|
—
|
|
—
|
|
Other current liabilities
|
143,250
|
|
143,250
|
|
143,250
|
|
—
|
|
—
|
|
Total
|
445,291
|
|
445,305
|
|
485,318
|
|
68,326
|
|
—
|
|
Note 6 – Breakdown of Revenue and Non-Current Assets by Geographical Areas
The Company operates in the following three geographical markets:
•Americas: North and South America;
•EMEA: Europe, Middle-East and Africa; and
•Asia-Pacific.
The following tables disclose the consolidated revenue for each geographical area for each of the reported periods. Revenue by geographical area is based on the location of advertisers’ campaigns.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
Americas
|
EMEA
|
Asia-Pacific
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018
|
808,865
|
|
711,110
|
|
428,972
|
|
1,948,947
|
|
December 31, 2019
|
850,570
|
|
720,099
|
|
449,446
|
|
2,020,115
|
|
December 31, 2020
|
784,717
|
|
656,593
|
|
375,131
|
|
1,816,441
|
|
Revenue generated in France amounted to €129.9 million, €128.9 million and €116.2 million for the periods ended December 31, 2018, 2019 and 2020, respectively.
Revenue generated in other significant countries where the Group operates is presented in the following table:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
|
|
|
|
|
|
|
Americas
|
|
|
|
|
|
|
United States
|
|
|
|
719,399
|
|
769,246
|
|
715,074
|
|
EMEA
|
|
|
|
|
|
|
Germany
|
|
|
|
171,901
|
|
178,661
|
|
161,264
|
|
United Kingdom
|
|
|
|
82,841
|
|
79,430
|
|
81,758
|
|
Asia-Pacific
|
|
|
|
|
|
|
Japan
|
|
|
|
297,701
|
|
305,785
|
|
263,933
|
|
Other Information
For each reported period, non-current assets (corresponding to the net book value of tangible and intangible assets) are presented in the table below. The geographical information results from the locations of legal entities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
Holding
|
Americas
|
of which
|
EMEA
|
Asia-Pacific
|
of which
|
Total
|
United States
|
Japan
|
Singapore
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018
|
107,762
|
|
109,741
|
|
95,352
|
|
24,365
|
|
16,687
|
|
10,157
|
|
2,613
|
|
258,555
|
|
December 31, 2019
|
121,612
|
|
93,050
|
|
89,111
|
|
18,102
|
|
17,408
|
|
8,561
|
|
5,314
|
|
250,172
|
|
December 31, 2020
|
110,434
|
|
76,176
|
|
75,813
|
|
7,128
|
|
25,673
|
|
16,733
|
|
5,707
|
|
219,411
|
|
Note 7 – Nature of Expenses Allocated by Function
Nature of Expenses Allocated to Cost of Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Traffic acquisition costs
|
|
|
|
(1,130,574)
|
|
(1,174,590)
|
|
(1,093,376)
|
|
Other cost of revenue
|
|
|
|
(111,602)
|
|
(104,697)
|
|
(119,359)
|
|
- Hosting cost
|
|
|
|
(46,398)
|
|
(30,071)
|
|
(31,273)
|
|
- Depreciation and amortization - Leased servers and related equipment (1)
|
|
|
|
(57,044)
|
|
(60,754)
|
|
(70,873)
|
|
- Data acquisition costs
|
|
|
|
(240)
|
|
(2,151)
|
|
(4,348)
|
|
- Other
|
|
|
|
(7,920)
|
|
(11,721)
|
|
(12,865)
|
|
Total cost of revenue
|
|
|
|
(1,242,176)
|
|
(1,279,287)
|
|
(1,212,735)
|
|
(1) Adoption of IFRS 16 Leases on January 1, 2019 (note 3)
Nature of Expenses Allocated to Research and Development
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Personnel expenses
|
|
|
|
(110,693)
|
|
(104,334)
|
|
(79,288)
|
|
- Personnel expenses excluding shared-based payment & research tax credit
|
|
|
|
(101,648)
|
|
(110,490)
|
|
(85,300)
|
|
- Share based compensation
|
|
|
|
(18,094)
|
|
(8,325)
|
|
(8,559)
|
|
- Research tax credit
|
|
|
|
9,049
|
|
14,481
|
|
14,571
|
|
Other cash operating expenses
|
|
|
|
(31,452)
|
|
(25,096)
|
|
(18,870)
|
|
-Subcontracting and other headcount-related costs
|
|
|
|
(12,811)
|
|
(14,597)
|
|
(9,374)
|
|
- Rent and facilities costs
|
|
|
|
(12,044)
|
|
(3,819)
|
|
(3,179)
|
|
- Consulting and professional fees
|
|
|
|
(2,812)
|
|
(3,944)
|
|
(4,188)
|
|
- Marketing costs
|
|
|
|
(4,214)
|
|
(3,410)
|
|
(1,869)
|
|
- Other
|
|
|
|
429
|
|
674
|
|
(260)
|
|
Other non-cash operating expenses
|
|
|
|
(9,743)
|
|
(24,304)
|
|
(16,774)
|
|
- Depreciation and amortization - leases (1)
|
|
|
|
—
|
|
(8,879)
|
|
(6,381)
|
|
- Depreciation and amortization - other
|
|
|
|
(9,027)
|
|
(14,746)
|
|
(9,418)
|
|
- Net change in other provisions
|
|
|
|
(716)
|
|
(679)
|
|
(975)
|
|
Total Research and development expenses
|
|
|
|
(151,888)
|
|
(153,734)
|
|
(114,932)
|
|
(1) Adoption of IFRS 16 Leases on January 1, 2019
Nature of Expenses Allocated to Sales and Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Personnel expenses
|
|
|
|
(206,925)
|
|
(217,714)
|
|
(194,868)
|
|
- Personnel expenses excluding shared-based payment
|
|
|
|
(182,664)
|
|
(202,633)
|
|
(185,854)
|
|
- Share based compensation
|
|
|
|
(24,261)
|
|
(15,081)
|
|
(9,014)
|
|
Other cash operating expenses
|
|
|
|
(88,930)
|
|
(83,644)
|
|
(46,784)
|
|
- Subcontracting and other headcount related costs
|
|
|
|
(21,770)
|
|
(22,022)
|
|
(11,684)
|
|
- Rent and facilities costs
|
|
|
|
(27,469)
|
|
(14,941)
|
|
(10,879)
|
|
- Consulting and professional fees
|
|
|
|
(4,517)
|
|
(6,242)
|
|
(8,462)
|
|
- Marketing costs
|
|
|
|
(15,133)
|
|
(18,583)
|
|
(2,528)
|
|
- Operating taxes
|
|
|
|
(9,977)
|
|
(5,535)
|
|
(3,746)
|
|
- Other including bad debt expense
|
|
|
|
(10,064)
|
|
(16,321)
|
|
(9,485)
|
|
Other non-cash operating expenses
|
|
|
|
(19,912)
|
|
(36,085)
|
|
(46,073)
|
|
- Depreciation and amortization - leases (1)
|
|
|
|
—
|
|
(17,938)
|
|
(14,981)
|
|
- Depreciation and amortization - other
|
|
|
|
(15,470)
|
|
(22,258)
|
|
(14,669)
|
|
- Net change in provision for doubtful receivables
|
|
|
|
(4,619)
|
|
5,536
|
|
(16,882)
|
|
- Net change in provisions for risks and charges
|
|
|
|
177
|
|
(1,425)
|
|
459
|
|
Total Sales and operations expenses
|
|
|
|
(315,767)
|
|
(337,443)
|
|
(287,725)
|
|
(1) Adoption of IFRS 16 Leases on January 1, 2019 .
Nature of Expenses Allocated to General and Administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Personnel expenses
|
|
|
|
(64,660)
|
|
(67,720)
|
|
(57,868)
|
|
- Personnel expenses excluding shared-based payment
|
|
|
|
(50,601)
|
|
(54,505)
|
|
(50,235)
|
|
- Share based compensation
|
|
|
|
(14,059)
|
|
(13,215)
|
|
(7,633)
|
|
Other cash operating expenses
|
|
|
|
(41,418)
|
|
(40,414)
|
|
(36,845)
|
|
- Subcontracting and other headcount related costs
|
|
|
|
(14,097)
|
|
(13,203)
|
|
(8,381)
|
|
- Rent and facilities costs
|
|
|
|
(9,344)
|
|
(4,674)
|
|
(4,684)
|
|
- Consulting and professional fees
|
|
|
|
(15,382)
|
|
(17,265)
|
|
(17,590)
|
|
- Marketing costs
|
|
|
|
(899)
|
|
(2,796)
|
|
(1,441)
|
|
- Other
|
|
|
|
(1,696)
|
|
(2,476)
|
|
(4,749)
|
|
Other non-cash operating expenses
|
|
|
|
(8,253)
|
|
(16,331)
|
|
(7,486)
|
|
- Depreciation and amortization - leases (1)
|
|
|
|
—
|
|
(7,169)
|
|
(4,822)
|
|
- Depreciation and amortization - other
|
|
|
|
(6,187)
|
|
(6,432)
|
|
(4,217)
|
|
- Net change in provision for risks and charges
|
|
|
|
(2,066)
|
|
(2,730)
|
|
1,553
|
|
Total General and administrative expenses
|
|
|
|
(114,331)
|
|
(124,465)
|
|
(102,199)
|
|
(1) Adoption of IFRS 16 Leases on January 1, 2019.
Note 8 – Allocation of Personnel Expenses
Allocation of Personnel Expenses By Function
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Research and development expenses
|
|
|
|
(110,693)
|
|
(104,334)
|
|
(79,288)
|
|
Sales and operations expenses
|
|
|
|
(206,925)
|
|
(217,714)
|
|
(194,868)
|
|
General and administrative expenses
|
|
|
|
(64,660)
|
|
(67,720)
|
|
(57,868)
|
|
Total Personnel expenses
|
|
|
|
(382,278)
|
|
(389,768)
|
|
(332,024)
|
|
Allocation of Personnel Expenses by Nature
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Wages and salaries
|
|
|
|
(250,920)
|
|
(274,104)
|
|
(244,397)
|
|
Severance pay
|
|
|
|
(5,864)
|
|
(11,170)
|
|
(4,599)
|
|
Social charges
|
|
|
|
(65,450)
|
|
(68,415)
|
|
(66,172)
|
|
Other social expenses
|
|
|
|
(12,173)
|
|
(13,857)
|
|
(6,221)
|
|
Share based compensation
|
|
|
|
(56,414)
|
|
(36,621)
|
|
(25,206)
|
|
Profit sharing
|
|
|
|
(506)
|
|
(82)
|
|
—
|
|
Research tax credit (classified as a reduction of R&D expenses)
|
|
|
|
9,049
|
|
14,481
|
|
14,571
|
|
Total personnel expenses
|
|
|
|
(382,278)
|
|
(389,768)
|
|
(332,024)
|
|
Note 9 – Share-Based Compensation
Share Options Plans (OSA), Restricted Stock Units (RSU) and Employee Warrants Grants (BSPCE)
The board of directors has been authorized by the general meeting of the shareholders to grant employee warrants (Bons de Souscription de Parts de Créateur d’Entreprise or “BSPCE”) and to implement share options plans as follows:
•Issuance of 2,112,000 BSPCE, authorized at the General Meeting of Shareholders on October 24, 2008, making available up to 2,112,000 BSPCE until April 24, 2010
(“Plan 1”);
•Issuance of 1,472,800 BSPCE, authorized at the General Meeting of Shareholders on April 16, 2009, making available up to 1,472,800 BSPCE until October 16, 2010
(“Plan 2”);
•1,584,000 OSA, authorized at the General Meeting of Shareholders on September 9, 2009, making available up to 1 584 000 OSA until November 8, 2012. This Plan has been amended at the General Meeting of Shareholders on November 16, 2010, making available up to 2,700,000 OSA or BSPCE (“Plan 3”);
•Issuance of 361,118 BSPCE, granted to Criteo’s co-founders at the General Meeting of Shareholders on April 23, 2010 (“Plan 4”);
•2,800,000 BSPCE or OSA, authorized at the General Meeting of Shareholders on November 18, 2011, making available up to 2,800,000 OSA or BSPCE (“Plan 5”);
•1,654,290 BSPCE or OSA, authorized at the General Meeting of Shareholders on September 14, 2012, making available up to 1,654,290 OSA or BSPCE (“Plan 6”).
•6,627,237 BSPCE or OSA, authorized at the General Meeting of Shareholders on August 2, 2013, making available up to 6,627,237 OSA or BSPCE (“Plan 7”).
•9,935,710 OSA, authorized at the General Meeting of Shareholders on June 18, 2014, making available up to 9,935,710 OSA (“Plan 8”). The board of directors has also authorized free shares/restricted stock units ("RSUs") to Criteo employees under presence condition and to certain senior managers, employees and members of management, subject to the achievement of internal performance objectives and presence condition.
•4,600,000 OSAs or RSUs, authorized at the General Meeting of Shareholders on June 29, 2016 and 100,000 warrants (any warrant granted will also be deducted from the 4,600,000 limit), such authorizations collectively referred to as “Plan 9”. The board of directors has authorized RSU to Criteo employees subject to a presence condition and to certain senior managers, employees and members of management, subject to the achievement of internal performance objectives and a presence condition.
•4,600,000 OSAs or RSUs, authorized at the General Meeting of Shareholders on June 28, 2017 and 120,000 warrants (any warrant granted will also be deducted from the 4,600,000 limit), such authorizations collectively referred to as “Plan 10”. The board of directors has authorized RSUs to Criteo employees subject to a presence condition and to certain senior managers, employees and members of management, subject to the achievement of internal performance objectives and a presence condition.
•4,200,000 OSAs or RSUs, authorized at the General Meeting of Shareholders on June 27, 2018 and 150,000 warrants (any warrant granted will also be deducted from the limit), such authorizations collectively referred to as “Plan 11”. The board of directors has authorized RSUs to Criteo employees subject to a presence condition and to certain senior managers, employees and members of management, subject to the achievement of internal performance objectives and a presence condition.
•6,200,000 OSAs or RSUs, authorized at the General Meeting of Shareholders on May 16, 2019 and 175,000 warrants (any warrant granted will also be deducted from the limit), such authorizations collectively referred to as “Plan 12”. The board of directors has authorized RSUs to Criteo employees subject to a presence condition and to certain senior managers, employees and members of management, subject to the achievement of internal performance objectives and a presence condition.
•6,463,000 Share Options or RSUs, authorized at the General Meeting of Shareholders on June 25, 2020, such authorizations collectively referred to as “Plan 13”. The Board of Directors has authorized RSUs to Criteo employees subject to a presence condition and to members of management, subject to the achievement of internal performance objectives and a presence condition.
Upon the exercise of the BSPCEs or Share Options, we grant beneficiaries newly issued ordinary shares of the Parent. We also grant beneficiaries ordinary shares of the Parent upon the vesting of RSUs. Prior to the beginning of our share repurchase programs described elsewhere in this Form 10-K, these grants relating to vested RSUs were completed using newly issued ordinary shares. Since the initiation of our share repurchase programs, the grants relating to vested RSUs are completed using existing ordinary shares that were repurchased as part of our share repurchase programs.
The BSPCEs and OSAs may be exercised by the beneficiary on the basis of the following vesting schedule for the Plans 1, 2 and 3:
•up to 1/3 of the BSPCE on the first anniversary of the date of grant;
•up to 1/12 at the expiration of each quarter following the first anniversary of the date of grant, and this during 24 months thereafter; and
•at the latest within 10 years from the date of grant.
For the Plan 3 amended to Plan 13, the vesting schedule is as follows:
•up to 1/4 of the BSPCE/share options on the first anniversary of the date of grant;
•up to 1/16 at the expiration of each quarter following the first anniversary of the date of grant, and this during 36 months thereafter.
•The BSPCEs and OSAs may be exercised at the latest within 10 years from the date of grant.
The vesting schedule for the RSUs is as follows:
•50% at the expiration of a two year period;
•6,25% at the expiration of each quarter following the first two years-period during 24 months.
When the Company was not listed, exercise prices were determined by reference to the latest capital increase as of the date of grant, unless the board of directors decided otherwise. Since our initial public offering, exercise prices are determined by reference to the closing share price the day before the date of the grant if higher than a floor value of 95% of the average of the closing share price for the last 20 trading days.
Details of BSPCE / OSA / RSU plans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plans 1&2
|
Plan 3
|
Plan 5
|
Plan 6
|
Plan 7
|
Plan 8
|
Plan 9
|
Plan 10
|
Plan 11
|
Plan 12
|
Plan 13
|
Dates of grant (board of directors)
|
Oct 24, 2008 - Sept 14, 2010
|
Sept 9, 2009 - Sept 21, 2011
|
Nov 18, 2011 - May 22, 2012
|
Oct 25, 2012
|
Oct 25, 2012 - April 18, 2013
|
Sept 3, 2013 - April 23, 2014
|
July 30, 2014 - June 28, 2016
|
July 28, 2016 - June 27, 2017
|
July 27, 2017 - Jun 26, 2018
|
July 26, 2018 - June 25, 2019
|
July 25, 2019 - June 24, 2020
|
June 25, 2020 - December 15, 2020
|
Vesting period
|
3 years
|
3 - 4 years
|
4 years
|
1 year
|
4-5 years
|
4 years
|
4 years
|
4 years
|
4 years
|
4 years
|
4 years
|
4 years
|
4 years
|
4 years
|
4 years
|
4 years
|
4 years
|
Contractual life
|
10 years
|
10 years
|
10 years
|
10 years
|
10 years
|
10 years
|
10 years
|
-
|
10 years
|
-
|
10 years
|
-
|
10 years
|
-
|
10 years
|
—
|
—
|
Expected life
|
8 years
|
8 years
|
8 years
|
8 years
|
8 years
|
6 - 8 years
|
6 years
|
-
|
6 years
|
-
|
6 years
|
-
|
6 years
|
-
|
6 years
|
—
|
—
|
Number of options granted
|
1,819,120
|
4,289,940
|
1,184,747
|
257,688
|
1,065,520
|
2,317,374
|
4,318,551
|
2,534,262
|
502,410
|
2,556,315
|
947,565
|
2,150,498
|
128,380
|
2,712,014
|
515,980
|
3,733,588
|
858,467
|
Type: Share Option (S.O. / BSPCE / RSU)
|
BSPCE
|
BSPCE & OSA
|
BSPCE & OSA
|
BSPCE
|
BSPCE & OSA
|
BSPCE & OSA
|
OSA
|
RSU
|
OSA
|
RSU
|
OSA
|
RSU
|
OSA
|
RSU
|
OSA
|
RSU
|
RSU
|
Share entitlement per option
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
1
|
Exercise price
|
€ 0,45 - € 2,10
|
€ 0,20 - € 5,95
|
€ 5,95
|
€ 8,28
|
€ 8,28 - € 10,43
|
€ 12,08 - € 38,81
|
€ 22,95 - €47,47
|
-
|
€38,20 - € 43,45
|
-
|
€24,63 - € 28,69
|
-
|
€15.86 - €18.72
|
-
|
€8.66-€15.67
|
—
|
—
|
Valuation method
|
Black & Scholes
|
Grant date share fair value
|
€0.20 - €0.70
|
€0.20 - €4.98
|
€ 4.98
|
€ 6.43
|
€5.45 - €6.43
|
€12.08 - €38.81
|
€22.50 - €47.47
|
€35.18 - €35.58
|
€38.20 - €43.45
|
€33.98 - €49.08
|
€24.63 - €28.69
|
€22.92 - €44.37
|
€15.86 - €17.98
|
€24.92 - €44.37
|
€8.66-€15.67
|
€ 3.29-€17.44
|
€10.79-€15.57
|
Expected volatility(1)
|
53.0% - 55.7%
|
55.2% - 57.8%
|
52.1% - 52.9%
|
50.20%
|
49.6% - 50.2%
|
44.2% - 50.1%
|
39.4% - 44.5%
|
-
|
40.6% - 41.3%
|
-
|
41.0% - 41.5%
|
-
|
40.7% - 41.2%
|
-
|
39.2%-39.9%
|
—
|
—
|
Discount rate(2)
|
2.74% - 4.10%
|
2.62% - 3.76%
|
2.79% - 3.53%
|
2.20%
|
1.80% - 2.27%
|
1.20% - 2.40%
|
0.00% - 0.71%
|
N/A
|
N/A
|
N/A
|
0.6% - 0.7%
|
N/A
|
0.1% - 0.9%
|
N/A
|
0.0%-0.25%
|
N/A
|
N/A
|
Performance conditions
|
No
|
Yes (A)
|
No
|
Yes (B)
|
No
|
No
|
No
|
Yes (C)
|
No
|
Yes (D)
|
No
|
No
|
No
|
Yes (E)
|
No
|
Yes (F)(G)
|
Yes (G)
|
Fair value per option / RSU
|
€0.08 -
€0.45
|
€0.08 -
€2.88
|
€2.75 -
€2.95
|
€3.28
|
€3.28 -
€5.83
|
€6.85 -
€16.90
|
€9.47 -
€17.97
|
€26.16 -
€37.10
|
€14.49 - €16.82
|
€33.98 -
€49.08
|
€9.85 - €11.40
|
€22.92 - €44.37
|
€6.15 - €6.94
|
€15.86 - €30.80
|
€3.29 -€5.78
|
€8.66-€17.44
|
€10.79-€15.57
|
(1) Based on similar listed entities.
(2) Based on Obligation Assimilables du Trésor, i.e. French government bonds with a ten-year maturity (“TEC 10 OAT floating-rate bonds”).
(A) 180 000 OSA are subjected to performance conditions based on revenue excluding traffic acquisition costs targets that were met in 2012.
(B) The conditions of exercise of 257 688 BSPCE are linked to a future liquidity event or a transfer of control of the Company, and the number of BSPCE that can be exercised are determined by the event’s date which cannot occur after March 31, 2014. Based on the assumptions known as at December 31, 2012, the Group determined that the share-based compensation expense would be recognized over a one-year period. This assumption was confirmed in 2013.
(C) On October 29, 2015 and January 29, 2016, the board of directors of the Parent granted a total of 337,960 and 33,010 RSUs to Criteo employees under condition of presence and to certain senior managers, employees and members of the management, subject to the achievement of internal performance objectives and condition of presence. Based on the assumptions known at December 31, 2016, the Group determined the share-based compensation expense by applying a probability ratio on performance objectives completion. The assumptions taken were confirmed in 2016.
(D) On July 28, 2016 and June 27, 2017 the board of directors of the Parent granted a total of 195,250 RSUs and 135,500 RSUs respectively, to certain senior managers, and members of the management, subject to the achievement of internal performance objectives and condition of presence. Based on the assumptions known at December 31, 2016 and 2017, the Group determined the share-based compensation expense by applying a probability ratio on performance objectives completion. The assumptions were confirmed in 2017 and 2018.
(E) On July 26, 2018, the board of directors of the Parent granted a total of 203,332 RSU to certain senior managers and members of the management, subject to the achievement of internal performance objectives and condition of presence. Based on the assumptions known at December 31, 2018, we determined the share-based compensation expense by applying a probability ratio on performance objectives completion.
(F) On April 25, 2019, the board of directors of the Parent granted a total of 257,291 RSUs to members of the management, subject to the achievement of internal performance objectives and condition of presence. Based on the assumptions known at December 31, 2019, we determined the share-based compensation expense by applying a probability ratio on performance objectives completion.
(G) On March 3, 2020, October 23, 2020 and December 9, 2020 the Board of Directors of the Parent granted a total of 272,600 RSUs to members of the management, subject to the achievement of internal performance objectives and condition of presence. Based on the assumptions known at December 31, 2020, we determined the share-based compensation expense by applying a probability ratio on performance objectives completion.
Change in Number of BSPCE/OSA/RSU
|
|
|
|
|
|
|
|
|
|
|
|
|
BSPCE/OSA
|
RSUs
|
Total
|
Balance at January 1, 2018
|
3,192,708
|
|
4,212,508
|
|
7,405,216
|
|
Granted
|
1,013,065
|
|
3,133,644
|
|
4,146,709
|
|
Exercised
|
(137,348)
|
|
N/A
|
(137,348)
|
|
Vested
|
—
|
|
(1,362,873)
|
|
(1,362,873)
|
|
Forfeited
|
(880,960)
|
|
(1,203,142)
|
|
(2,084,102)
|
|
Expired
|
—
|
|
—
|
|
—
|
|
Balance at December 31, 2018
|
3,187,465
|
|
4,780,137
|
|
7,967,602
|
|
Granted
|
438,347
|
|
3,147,751
|
|
3,586,098
|
|
Exercised
|
(83,266)
|
|
—
|
|
(83,266)
|
|
Vested
|
—
|
|
(1,219,112)
|
|
(1,219,112)
|
|
Forfeited
|
(983,012)
|
|
(1,729,789)
|
|
(2,712,801)
|
|
Expired
|
—
|
|
—
|
|
—
|
|
Balance at December 31, 2019
|
2,559,534
|
|
4,978,987
|
|
7,538,521
|
|
Granted
|
140,513
|
|
2,684,402
|
|
2,824,915
|
|
Exercised
|
(223,934)
|
|
—
|
|
(223,934)
|
|
Vested
|
—
|
|
(1,478,894)
|
|
(1,478,894)
|
|
Forfeited
|
(370,355)
|
|
(1,230,404)
|
|
(1,600,759)
|
|
Expired
|
(3,600)
|
|
—
|
|
(3,600)
|
|
Balance at December 31, 2020
|
2,102,158
|
|
4,954,091
|
|
7,056,249
|
|
Breakdown of the Closing Balance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plans 1&2
|
Plan 3
|
Plan 5
|
Plan 6
|
Plan 7
|
Plan 8
|
Plan 9
|
Plan 10
|
Plan 11
|
Plan 12
|
RSUs
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
Number outstanding
|
3,600
|
67,751
|
242,613
|
41,338
|
306,172
|
1,599,033
|
328,726
|
532,732
|
65,500
|
—
|
4,780,137
|
7,967,602
|
Weighted-average exercise price
|
€ 0.70
|
€ 4.43
|
€ 5.95
|
€ 9.26
|
€ 17.95
|
€ 30.99
|
€ 41.75
|
25.79
|
18.72
|
—
|
—
|
€ 26.94
|
Number exercisable
|
3,600
|
67,751
|
242,613
|
41,338
|
306,172
|
1,417,904
|
161,658
|
—
|
—
|
—
|
—
|
2,241,036
|
Weighted-average exercise price
|
€ 0.70
|
€ 4.43
|
€ 5.95
|
€ 9.26
|
€ 17.95
|
€ 30.04
|
€ 41.37
|
—
|
—
|
—
|
—
|
€ 25.39
|
Weighted-average remaining contractual life
|
1.2 years
|
2.4 years
|
3.3 years
|
4.0 years
|
4.9 years
|
6.2 years
|
8.2 years
|
9.3 years
|
9.8 years
|
—
|
—
|
6.7 years
|
Balance at December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
Number outstanding
|
3,600
|
63,544
|
230,673
|
26,350
|
216,157
|
1,080,017
|
116,580
|
318,766
|
128,380
|
375,467
|
4,978,987
|
7,538,521
|
Weighted-average exercise price
|
€ 0.70
|
€ 4.37
|
€ 5.95
|
€ 9.28
|
€ 17.70
|
€ 29.69
|
€ 41.50
|
€ 26.58
|
€ 17.32
|
15.67
|
—
|
€ 23.09
|
Number exercisable
|
3,600
|
63,544
|
230,673
|
26,350
|
216,157
|
1,066,670
|
80,966
|
129,908
|
16,375
|
—
|
—
|
1,834,243
|
Weighted-average exercise price
|
€ 0.70
|
€ 4.37
|
€ 5.95
|
€ 9.28
|
€ 17.70
|
€ 29.58
|
€ 41.17
|
26.42
|
—
|
—
|
—
|
€ 24.12
|
Weighted-average remaining contractual life
|
0.2 years
|
1.4 years
|
2.3 years
|
3 years
|
3.9 years
|
5.1 years
|
7.1 years
|
8.3 years
|
9.1 years
|
9,9 years
|
—
|
6,2 years
|
Balance at December 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
Number outstanding
|
—
|
42,644
|
101,852
|
20,870
|
104,131
|
921,534
|
97,013
|
169,754
|
128,380
|
515,980
|
4,954,091
|
7,056,249
|
Weighted-average exercise price
|
€ —
|
€5,31
|
€5,95
|
€9,36
|
€20,05
|
€29,82
|
€41,18
|
€26,46
|
€17,32
|
€13,76
|
—
|
€26,81
|
Number exercisable
|
—
|
42,644
|
101,852
|
20,870
|
104,131
|
921,534
|
97,013
|
169,754
|
56,330
|
93,867
|
—
|
1,607,995
|
Weighted-average exercise price
|
€ —
|
€5,31
|
€5,95
|
€9,36
|
€20,05
|
€29,82
|
€41,18
|
€26,46
|
€17,32
|
—
|
—
|
€24,87
|
Weighted-average remaining contractual life
|
—
|
0.5 years
|
1.3 years
|
2.1 years
|
2.9 years
|
4.2 years
|
6.1 years
|
7.3 years
|
8.1 years
|
9.0 years
|
—
|
5.8 years
|
Warrants
In addition to the RSUs, OSAs and BSPCE grants, the shareholders of the Parent company also authorized the grant of warrants, as indicated below:
•Plan A : up to 1/8 at the expiration of each quarter following the date of grant, and this during 24 months; and at the latest within 10 years as from the date of grant.
•Plan B : up to 1/3 of the warrants on the first anniversary of the date of grant; then up to 1/12 at the expiration of each quarter following the first anniversary of the beginning of the vesting period, and this during 24 months thereafter; and at the latest within 10 years as from the date of grant.
•Plan C: up to 1/24 at the expiration of each month following the date of grant, and this during 24 months, and at the latest within 10 years as from the date of grant.
•Plan D (member of the advisory board): up to 1/24 at the expiration of each month following the date of grant, and this during 24 months; and at the latest within 10 years as from the date of grant.
•Plan D (not member of the advisory board): 1/3 at the date of grant; 1/3 at the first anniversary of the date of grant; 1/3 at the second anniversary of the date of grant; and at the latest within10 years as from the date of grant.
•Plans E, F, G, H and I: up to 1/4 of the warrants on the first anniversary of the date of grant; up to 1/16 at the expiration of each quarter following the first anniversary of the date of grant, and this during 36 months thereafter; and at the latest within 10 years from the date of grant.
Upon exercise of the warrants, the Group offers settlement of the warrants in newly issued ordinary shares of the Parent company.
When the Company was not listed, exercise prices were determined by reference to the latest capital increase as of the date of grant, unless the board of directors decided otherwise. Since our initial public offering, exercise prices are determined by reference to the closing share price the day before the date of the grant if higher than the average of the closing share price for the last 20 trading days.
Details of Warrants
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plan A
|
Plan B
|
Plan C
|
Plan D
|
Plan E
|
Plan F
|
Plan G
|
Plan H
|
Plan I
|
Dates of grant (board of director)
|
Nov 17, 2009
|
March 11, 2010
|
Nov 16, 2010 - Sept 21, 2011
|
Oct 25, 2012 - March 6, 2013
|
March 19, 2015 - Oct 29, 2015
|
April 20, 2016 - Mar 1, 2017
|
Jul 27, 2017 - Oct 26, 2017
|
Oct 25, 2018
|
October 24, 2019
|
Vesting period
|
2 years
|
3 years
|
2 years
|
2 years
|
1 - 4 years
|
1 - 4 years
|
1 - 4 years
|
1 - 4 years
|
1 - 4 years
|
Contractual life
|
10 years
|
10 years
|
10 years
|
10 years
|
10 years
|
10 years
|
10 years
|
10 years
|
10 years
|
Expected life
|
8 years
|
8 years
|
8 years
|
8 years
|
4 - 9 years
|
4 - 9 years
|
4 - 9 years
|
4 - 9 years
|
4 - 9 years
|
Number of warrants granted
|
231,792
|
|
277,200
|
|
192,000
|
|
125,784
|
|
38,070
|
|
59,480
|
|
46,465
|
|
125,000
|
|
105,680
|
|
Share entitlement per warrant
|
1
|
|
1
|
|
1
|
|
1
|
|
1
|
|
1
|
|
1
|
|
1
|
|
1
|
|
Share warrant price
|
€ 0,02
|
€ 0,07 - € 0,11
|
€ 0,04 - € 0,30
|
€ 0,43 - € 0,48
|
€ 9,98 - € 16,82
|
€ 13,89 - € 17,44
|
€13.88 - € 17.55
|
€ 6,91
|
€6,81
|
Exercise price
|
€ 0,70
|
€ 0,70
|
€ 0,70 - € 5,95
|
€ 8,28 - € 9,65
|
€ 35,18 - € 41,02
|
€ 33,98 - € 43,42
|
€ 35.80 - € 44.37
|
€ 19,71
|
€17,44
|
Performance conditions
|
No
|
Yes (A)
|
No
|
No
|
No
|
No
|
No
|
No
|
Non
|
Valuation method
|
Binomial method
|
|
Grant date share fair value
|
€ 0,20
|
€ 0,70
|
€ 0,70 - € 4,98
|
€ 6,43 - € 9,65
|
€ 35,18 - € 41,02
|
€ 33,98 - € 44,33
|
€ 35,80 - € 44,37
|
€ 19,71
|
€17,44
|
Expected volatility(1)
|
55.7
|
%
|
55.2
|
%
|
53,5% - 55,0%
|
50,0% - 50,2%
|
39.9
|
%
|
40,6% - 40,9%
|
41,0% - 41,3%
|
40,7%
|
37.2
|
%
|
Discount rate(2)
|
3.58
|
%
|
3.44
|
%
|
2,62%-3,38%
|
2,13%-2,27%
|
0,00%-0,52%
|
0,10%-0,66%
|
0,54%-0,60%
|
0,6%
|
(0,2)%
|
Fair value per warrant
|
€ 0,05
|
€ 0,33 - € 0,38
|
€ 0,40 - € 2,58
|
€ 2,85 - € 4,98
|
€ 9,98 - € 16,82
|
€ 13,89 - € 14,55
|
€ 13,88 - € 17,55
|
€ 6,91
|
€ 6,81
|
(1) Based on similar listed entities.
(2) Based on Obligations Assimilables du Trésor, i.e. French government bonds with a ten-year maturity (“TEC 10 OAT floating-rate bonds”).
(A) All the performance conditions relating to Plan B were achieved during the period ended December 31, 2010.
Changes in Number of Warrants
|
|
|
|
|
|
|
Warrant
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2018
|
186,276
|
|
Granted
|
125,000
|
|
Exercised
|
—
|
|
Forfeited
|
(19,606)
|
|
Expired
|
—
|
|
Balance at December 31, 2018
|
291,670
|
|
Granted
|
105,680
|
|
Exercised
|
—
|
|
Forfeited
|
(33,583)
|
|
Expired
|
—
|
|
Balance at December 31, 2019
|
363,767
|
|
Granted
|
—
|
|
Exercised
|
(7,250)
|
|
Forfeited
|
(12,742)
|
|
Expired
|
—
|
|
Balance at December 31, 2020
|
343,775
|
|
Breakdown of the Closing Balance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Number outstanding
|
|
|
|
291,670
|
363,767
|
343,775
|
Weighted-average exercise price
|
|
|
|
€13,02
|
€14,83
|
€15,12
|
Number exercisable
|
|
|
|
108,780
|
156,604
|
205,890
|
Weighted-average exercise price
|
|
|
|
€ 18.95
|
€ 17.52
|
17,33
|
Weighted-average remaining contractual life
|
|
|
|
7,9 years
|
7,6 years
|
6.8 years
|
Reconciliation with the Consolidated Statement of Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2018
|
Balance at December 31, 2019
|
Balance at December 31, 2020
|
(in thousands of euros)
|
|
|
|
|
|
|
|
|
|
|
|
|
R&D
|
S&O
|
G&A
|
Total
|
R&D
|
S&O
|
G&A
|
Total
|
R&D
|
S&O
|
G&A
|
Total
|
RSUs
|
|
|
|
|
|
|
|
|
|
|
|
|
(17,366)
|
(22,894)
|
(10,318)
|
(50,578)
|
(8,701)
|
(15,437)
|
(9,923)
|
(34,061)
|
(8,559)
|
(8,664)
|
(5,803)
|
(23,026)
|
Share options/BSPCE
|
|
|
|
|
|
|
|
|
|
|
|
|
(728)
|
(1,367)
|
(2,486)
|
(4,581)
|
376
|
356
|
(2,054)
|
(1,322)
|
—
|
(350)
|
(368)
|
(718)
|
Plan 7
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
1
|
—
|
(1)
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
Plan 8
|
|
|
|
|
|
|
|
|
|
|
|
|
143
|
(468)
|
(417)
|
(742)
|
117
|
81
|
(167)
|
31
|
—
|
—
|
(17)
|
(17)
|
Plan 9
|
|
|
|
|
|
|
|
|
|
|
|
|
(419)
|
(391)
|
(763)
|
(1,573)
|
180
|
231
|
(281)
|
130
|
—
|
—
|
203
|
203
|
Plan 10
|
|
|
|
|
|
|
|
|
|
|
|
|
(450)
|
(509)
|
(1,306)
|
(2,265)
|
79
|
159
|
(1,299)
|
(1,061)
|
—
|
—
|
767
|
767
|
Plan 11
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
—
|
—
|
—
|
—
|
(115)
|
(240)
|
(355)
|
—
|
(167)
|
(104)
|
(271)
|
Plan 12
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
—
|
—
|
—
|
—
|
—
|
(67)
|
(67)
|
—
|
(183)
|
(1,217)
|
(1,400)
|
Warrant
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
—
|
(1,255)
|
(1,255)
|
—
|
—
|
(1,238)
|
(1,238)
|
—
|
—
|
(1,462)
|
(1,462)
|
Plans E, F, G and H
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
—
|
(1,255)
|
(1,255)
|
—
|
—
|
(1,238)
|
(1,238)
|
—
|
—
|
(1,462)
|
(1,462)
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
(18,094)
|
(24,261)
|
(14,059)
|
(56,414)
|
(8,325)
|
(15,081)
|
(13,215)
|
(36,621)
|
(8,559)
|
(9,014)
|
(7,633)
|
(25,206)
|
R&D : Research and Development expenses
S&O : Sales and Operations expenses
G&A : General and Administrative expenses
Note 10 – Financial Income and Expenses
The Consolidated Statements of Income line item “Financial income (expense)” can be broken down as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Financial income from cash equivalents
|
|
|
|
893
|
|
1,365
|
|
979
|
|
Interest and fees
|
|
|
|
(1,784)
|
|
(2,126)
|
|
(2,463)
|
|
- Interest on debt
|
|
|
|
(1,521)
|
|
(1,567)
|
|
(2,086)
|
|
- Commissions
|
|
|
|
(263)
|
|
(559)
|
|
(377)
|
|
Interest on leases (1)
|
|
|
|
—
|
|
(4,207)
|
|
(2,524)
|
|
Foreign exchange loss
|
|
|
|
(3,340)
|
|
(3,997)
|
|
(343)
|
|
Other financial expense
|
|
|
|
(74)
|
|
(423)
|
|
(83)
|
|
Total financial expense
|
|
|
|
(4,305)
|
|
(9,388)
|
|
(4,434)
|
|
(1) Application of IFRS 16 leases on January 1, 2019.
The €4.4 million financial expense for the period ended December 31, 2020 was mainly driven by i) interest on lease liabilities ii) financial expense related to the drawing of €140 million, from May 2020 to November 2020, the up-front fees amortization and the non-utilization costs as part of our available Revolving Credit Facility (RCF) financing, partially offset by income from cash & cash equivalent. As of December 31, 2020, the main positions bearing currency risk are centralized and hedged at the level of the parent company.
The €9.4 million financial expense for the period ended December 31, 2019 was mainly driven by i) interest on lease liabilities following the application of IFRS 16 Leases on January 1, 2019 ii) commitment fees on the multi-currency revolving credit line and iii) the negative impact of revaluation of hedging contracts.
The €4.3 million financial expense for the period ended December 31, 2018 was mainly driven by i) commitment fees on the multi-currency revolving credit line amended in 2017 ii) from the limited impact hedging transactions on intra-group positions between Criteo S.A. and its U.S. and Brazilian subsidiaries, following their qualification as a net investment into a foreign subsidiary.
Note 11 – Income Taxes
Breakdown of Income Taxes
The Consolidated Statement of Income line item “Provision for income taxes” can be broken down as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Current income tax
|
|
|
|
(45,986)
|
|
(21,506)
|
|
(24,944)
|
|
Deferred tax
|
|
|
|
6,939
|
|
(12,577)
|
|
(3,349)
|
|
Income tax
|
|
|
|
(39,047)
|
|
(34,083)
|
|
(28,293)
|
|
As mentioned in Note 3 (Principles and Accounting Methods), the French Research Tax Credit is not included in the line item “Provision for income taxes” but is deducted from “Research and development expenses” (see Note 8 - Allocation of Personnel Expenses) unlike the U.S. Research Tax Credit for an amount of €5.5 million, €4.9 million and nil for the year ended December 31, 2018, 2019 and 2020 respectively.
French business tax, CVAE, is included in the current tax balance for an amount of €5.0 million, €4.9 million and €4.5 million, for the years ended December 31, 2018, 2019 and 2020 respectively.
Reconciliation between the Effective and Nominal Tax Expense
The following table shows the reconciliation between the effective and nominal tax expense at the nominal standard French rate of 32,02% (excluding additional contributions):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Income before taxes
|
|
|
|
120,480
|
|
115,798
|
|
94,416
|
|
Theoretical group tax rates
|
|
|
|
34.43
|
%
|
34.43
|
%
|
32.02
|
%
|
Nominal tax expense
|
|
|
|
(41,481)
|
|
(39,869)
|
|
(30,232)
|
|
Increase/decrease in tax expense arising from :
|
|
|
|
|
|
|
- Research tax credit (1)
|
|
|
|
8,646
|
|
9,692
|
|
4,639
|
|
- Net effect of share based compensation (2)
|
|
|
|
(14,965)
|
|
(11,998)
|
|
(10,170)
|
|
- BEAT waiver election (3)
|
|
|
|
—
|
|
(14,260)
|
|
(16,345)
|
|
- Other permanent differences (4)
|
|
|
|
(10,145)
|
|
(6,848)
|
|
7,860
|
|
- Non recognition of deferred tax assets related to tax losses and temporary differences (5)
|
|
|
|
(9,876)
|
|
(2,423)
|
|
(5,279)
|
|
- Utilization or recognition of previously unrecognized tax losses (6)
|
|
|
|
3,777
|
|
18,433
|
|
2,199
|
|
- French CVAE included in income taxes
|
|
|
|
(3,259)
|
|
(3,244)
|
|
(3,033)
|
|
- Special tax deduction (7)
|
|
|
|
32,664
|
|
14,243
|
|
11,734
|
|
- Effect of different tax rates
|
|
|
|
(319)
|
|
4,267
|
|
3,546
|
|
- Other differences
|
|
|
|
(4,089)
|
|
(2,076)
|
|
6,788
|
|
Effective tax expense
|
|
|
|
(39,047)
|
|
(34,083)
|
|
(28,293)
|
|
Effective tax rate
|
|
|
|
(32.5)
|
%
|
(29.5)
|
%
|
(30.1)
|
%
|
(1) Included income tax effect of the French RTC deducted from the "Research and development expenses" and U.S. tax credits included in the line "Provision for income taxes".
(2) While in most countries share-based compensation does not give rise to any tax effect either when granted or when exercised, the United States and the United Kingdom generally permit tax deductions in respect of share-based compensation. The tax deduction generated in the United States and United Kingdom in connection with the number of options exercised during the period was offset by the share-based compensation accounting expense exclusion.
(3) Final and new proposed regulations on the Base Erosion Anti-abuse Tax (BEAT) have been issued by the United States Treasury and IRS, allowing a waiver election to permanently forgo deductions for all U.S. federal tax purposes, with the result that the foregone deductions will not be treated as a base erosion tax benefit.
(4) Mainly related to employee costs, depreciation expenses and intercompany transactions.
(5) Deferred tax assets on which a valuation allowance has been recognized over the periods mainly relate to Criteo Ltd, Criteo Corp, Criteo France, Criteo Singapore Pte. Ltd, Criteo do Brasil LTDA and Criteo Pty.
(6) In 2019, recognition of previously unrecognized tax losses related to Criteo Corp., mainly generated by the BEAT waiver election implementation .(3)
(7) Special tax deductions refer to the application of a reduced income tax rate on the majority of the technology royalties income invoiced by the Parent to its subsidiaries.
Deferred Tax Assets and Liabilities
The following table shows the changes in the major sources of deferred tax assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands of euros)
|
Defined Benefit Obligation
|
Tax losses
|
Intangible & Tangible assets
|
Other
|
Limitation of Deferred Tax Assets
|
Deferred Tax Position
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2018
|
1,479
|
|
31,078
|
|
(18,843)
|
|
34,294
|
|
(29,246)
|
|
18,762
|
|
Recognized in profit or loss
|
518
|
|
15,861
|
|
6,574
|
|
(7,478)
|
|
(8,536)
|
|
6,939
|
|
Recognized in other comprehensive income
|
(360)
|
|
—
|
|
—
|
|
—
|
|
90
|
|
(270)
|
|
Change in scope
|
28
|
|
1,465
|
|
(7,968)
|
|
—
|
|
486
|
|
(5,989)
|
|
Currency translation adjustments
|
—
|
|
638
|
|
(532)
|
|
937
|
|
(475)
|
|
568
|
|
Transfer
|
—
|
|
(695)
|
|
—
|
|
695
|
|
—
|
|
—
|
|
Balance at December 31, 2018
|
1,665
|
|
48,347
|
|
(20,769)
|
|
28,448
|
|
(37,681)
|
|
20,010
|
|
Recognized in profit or loss
|
513
|
|
(24,725)
|
|
1,543
|
|
(5,640)
|
|
15,732
|
|
(12,577)
|
|
Recognized in other comprehensive income
|
422
|
|
—
|
|
—
|
|
—
|
|
(277)
|
|
145
|
|
Change in scope
|
—
|
|
(288)
|
|
—
|
|
—
|
|
288
|
|
—
|
|
Currency translation adjustments
|
—
|
|
680
|
|
(335)
|
|
507
|
|
(688)
|
|
164
|
|
Transfer
|
—
|
|
—
|
|
—
|
|
9,921
|
|
—
|
|
9,921
|
|
Balance at December 31, 2019
|
2,600
|
|
24,014
|
|
(19,561)
|
|
33,236
|
|
(22,626)
|
|
17,663
|
|
Recognized in profit or loss
|
173
|
|
(3,500)
|
|
1,746
|
|
9,124
|
|
(10,892)
|
|
(3,349)
|
|
Recognized in other comprehensive income
|
(1,320)
|
|
—
|
|
—
|
|
|
863
|
|
(457)
|
|
Change in scope
|
—
|
|
980
|
|
26
|
|
131
|
|
(1,028)
|
|
109
|
|
Currency translation adjustments
|
—
|
|
(1,463)
|
|
1,156
|
|
(3,562)
|
|
2,648
|
|
(1,221)
|
|
Transfer
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Balance at December 31, 2020
|
1,453
|
|
20,031
|
|
(16,633)
|
|
38,929
|
|
(31,035)
|
|
12,745
|
|
As at December 31, 2018, 2019 and 2020, the valuation allowance against net deferred income taxes amounted to €37.7 million, €22.6 million and €31.0 million, which related mainly to Criteo Corp. (€16.2 million, €11.4 million and €10.8 million, respectively), Criteo do Brasil (€3.0 million, €2.9 million and €2.2 million respectively), Criteo Ltd (€6.3 million, €6.7 million and €6.0 million, respectively), Criteo China (€3.1 million, €2.9 million and €2.7 million, respectively), Criteo Singapore (€2.5 million, €2.5 million and €2.7 million, respectively), Criteo Pty (€2.2 million, €2.3 million and €2.3 million, respectively) and Criteo France (€3.5 million, €(6.8) million and €0.8 million, respectively).
The Company has various net operating loss carryforwards, generated by the U.S. and Chinese subsidiaries of €3.4 million and €2.7 million, respectively, which begin to expire in 2030 and 2021, respectively. The Company has net operating loss carryforwards in the United Kingdom of €6.3 million which have no expiration date.
Current tax assets
Current tax assets mainly correspond to the down payments and tax credits of Criteo S.A., Criteo Corp. and Criteo Gmbh. Current tax liabilities arise primarily from Criteo K.K.
Ongoing tax inspection in the United States
On September 27, 2017, we received a draft notice of proposed adjustment (NOPA) from the Internal Revenue Service ("IRS") audit of Criteo Corp. for the year ended December 31, 2014, confirmed by the definitive notice dated February 8, 2018. We disagreed with the IRS's position and contested it. On August 24, 2020, the IRS and the Company agreed to a settlement and closed the income tax audit for the year ended December 31, 2014. The settlement provides for a disallowance of Criteo Corp's. Net Operating Losses (NOLs) amounting to $9.2 million (€7.5 million).
Note 12 – Categories of Financial Assets and Liabilities
Financial Assets
The following schedules disclose our financial assets categories for the presented periods:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018
|
(In thousands of euros)
|
Carrying Value
|
Loans and receivables
|
|
Fair value
|
Non current financial assets
|
17,869
|
|
17,869
|
|
|
17,869
|
|
Trade receivables, net of allowances
|
413,887
|
|
413,887
|
|
|
413,887
|
|
Other current assets
|
66,002
|
|
66,002
|
|
|
66,002
|
|
including derivatives instruments
|
—
|
|
—
|
|
|
1,487
|
|
Cash and cash equivalents
|
318,276
|
|
—
|
|
|
318,276
|
|
Total
|
816,034
|
|
497,758
|
|
|
816,034
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2019
|
(In thousands of euros)
|
Carrying Value
|
Loans and receivables
|
|
Fair value
|
Non current financial assets
|
19,358
|
|
19,358
|
|
|
19,358
|
|
Trade receivables, net of allowances
|
425,640
|
|
425,640
|
|
|
425,640
|
|
Other current assets
|
69,139
|
|
69,139
|
|
|
69,139
|
|
Cash and cash equivalents
|
372,751
|
|
—
|
|
|
372,751
|
|
Total
|
886,888
|
|
514,137
|
|
|
886,888
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2020
|
(In thousands of euros)
|
Carrying Value
|
Loans and receivables
|
|
Fair value
|
Marketable Securities
|
34,075
|
|
—
|
|
|
34,075
|
|
Non current financial assets
|
14,754
|
|
14,754
|
|
|
14,754
|
|
Trade receivables, net of allowances
|
386,321
|
|
386,321
|
|
|
386,321
|
|
Other current assets
|
73,466
|
|
73,466
|
|
|
73,466
|
|
Cash and cash equivalents
|
397,784
|
|
—
|
|
|
397,784
|
|
Total
|
906,400
|
|
474,541
|
|
|
906,400
|
|
Financial Liabilities
The following schedules disclose our financial liabilities categories for the presented periods:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018
|
(In thousands of euros)
|
Carrying Value
|
|
|
Fair value
|
Financial liabilities
|
3,063
|
|
|
|
3,063
|
|
Trade Payables
|
371,508
|
|
|
|
371,508
|
|
Other current liabilities
|
146,119
|
|
|
|
146,119
|
|
Total
|
520,690
|
|
|
|
520,690
|
|
|
|
|
|
|
|
December 31, 2019
|
(In thousands of euros)
|
Carrying Value
|
|
|
Fair value
|
Financial liabilities
|
3,920
|
|
|
|
3,920
|
|
including derivative instruments
|
—
|
|
|
|
1,143
|
|
Trade Payables
|
347,564
|
|
|
|
347,564
|
|
Other current liabilities
|
141,985
|
|
|
|
141,985
|
|
Total
|
493,469
|
|
|
|
493,469
|
|
|
|
|
|
|
|
December 31, 2020
|
(In thousands of euros)
|
Carrying Value
|
|
|
Fair value
|
Financial liabilities
|
2,669
|
|
|
|
2,669
|
|
including derivative instruments
|
—
|
|
|
|
754
|
|
Trade Payables
|
299,372
|
|
|
|
299,372
|
|
Other current liabilities
|
143,250
|
|
|
|
143,250
|
|
Total
|
445,291
|
|
|
|
445,291
|
|
|
|
|
|
|
Note 13 – Goodwill
|
|
|
|
|
|
(In thousands of euros)
|
Goodwill
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2019
|
273,259
|
|
Additions to goodwill
|
4,606
|
|
Currency translation adjustment
|
4,403
|
|
Balance at December 31, 2019
|
282,268
|
|
- Gross value at end of period
|
282,268
|
|
Balance at January 1, 2020
|
282,268
|
|
Additions to goodwill
|
2,381
|
|
Currency translation adjustment
|
(19,141)
|
|
Balance at December 31, 2020
|
265,508
|
|
- Gross value at end of period
|
265,508
|
|
Additions to goodwill in 2019 and 2020 were considered as not material to our consolidated financial statements.
On October 29, 2018, Criteo Corp., a U.S. subsidiary of Criteo S.A., acquired Manage.com Inc., a company with an app install solution that helps advertisers acquire new customers in mobile apps. The total consideration paid for the acquisition of shares was $60 million (€51.8 million). The acquisition was financed by available cash resources. The transaction has been accounted for as a business combination under the acquisition method of accounting. An evaluation of the assets and liabilities acquired was carried out subsequent to the acquisition and has led to the identification of technology and a customer base of $9.8 million (€8.4 million) and $7.3 million (€6.3 million) respectively, and a relative deferred tax liability for $4.4 million (€3.8 million). Residual goodwill was valued at $45.0 million (€40.0 million), after adjustments related to the working capital requirement. The acquisition costs of $1.0 million were fully expensed as incurred (€0.9 million).
On August 3, 2018, Criteo S.A. completed the acquisition of all of the outstanding shares of Storetail Marketing Services SAS, a pioneering retail media technology platform that enables retailers to monetize native placements on their ecommerce sites on a CPM basis. The total consideration paid for the acquisition was €41.3 million composed as follows: €37.7 million financed by available cash resources at the acquisition date and €3.6 million as deferred consideration due at the end of a two-year period. The transaction has been accounted for as a business combination under the acquisition method of accounting. An assessment of assets and liabilities acquired resulted in the identification of a marketing technology platform, valued at €12.2 million, and a relative deferred tax liability of €3.6 million. Residual goodwill was valued at €27.8 million. The acquisition costs of €0.6 million were fully expensed as incurred.
As at December 31, 2020, 2019 and 2018, the Company did not recognize any goodwill impairment as the recoverable value of the cash generating unit exceeded significantly its carrying value.
Note 14 – Intangible assets
Changes in net book value during the presented periods are summarized below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
Software
|
Technology and customer relationships
|
Construction in Progress
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2019
|
11,586
|
|
80,766
|
|
5,495
|
|
97,847
|
|
Additions to intangible assets
|
2,346
|
|
—
|
|
8,528
|
|
10,874
|
|
Amortization and impairment expense
|
(8,023)
|
|
(24,928)
|
|
—
|
|
(32,951)
|
|
Change in consolidation scope
|
97
|
|
—
|
|
—
|
|
97
|
|
Currency translation adjustment
|
—
|
|
1,469
|
|
4
|
|
1,473
|
|
Transfer into service
|
11,009
|
|
—
|
|
(11,009)
|
|
—
|
|
Balance at December 31, 2019
|
17,015
|
|
57,307
|
|
3,018
|
|
77,340
|
|
Gross value at end of period
|
50,294
|
|
127,651
|
|
3,018
|
|
180,963
|
|
Accumulated amortization and impairment at end of period
|
(33,279)
|
|
(70,344)
|
|
—
|
|
(103,623)
|
|
Balance at January 1, 2020
|
17,015
|
|
57,307
|
|
3,018
|
|
77,340
|
|
Additions to intangible assets
|
2,775
|
|
—
|
|
9,850
|
|
12,625
|
|
Amortization and impairment expense
|
(8,248)
|
|
(13,605)
|
|
—
|
|
(21,853)
|
|
Change in consolidation scope
|
54
|
|
—
|
|
—
|
|
54
|
|
Currency translation adjustment
|
(5)
|
|
(3,020)
|
|
(156)
|
|
(3,181)
|
|
Transfer into service
|
1,936
|
|
—
|
|
(1,936)
|
|
—
|
|
Balance at December 31, 2020
|
13,527
|
|
40,682
|
|
10,776
|
|
64,985
|
|
Gross value at end of period
|
54,479
|
|
119,924
|
|
10,776
|
|
185,179
|
|
Accumulated amortization and impairment at end of period
|
(40,952)
|
|
(79,242)
|
|
—
|
|
(120,194)
|
|
Additions to software consist mainly of capitalization of internally developed internal-use software and IT licenses.
Amortization on technology and customer relationships relates to HookLogic, Storetail and Manage intangibles resulting from each of the three business combinations respectively. In 2019 the increase in "Amortization and depreciation expense" was due to a change in useful life of Manage’s technology based on the early decommissioning of the Manage platform and an impairment loss of Manage’s customers relationships driven by lower business performance compared to expectations at the time of the acquisition, largely due to high client concentration and a volatile business environment.
No event in 2020 that would trigger impairment in the balance of intangibles has occurred.
The average life of software is 3 years. The average life of technology and customer relationships is between 3 and 9 years.
Note 15– Property, Plant and Equipment
Changes in net book value during the presented periods are summarized below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
Fixtures
and fittings
|
Furniture and equipment
|
Construction in progress
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2019
|
16,493
|
|
126,461
|
|
17,754
|
|
160,708
|
|
Additions to tangible assets
|
416
|
|
20,652
|
|
41,944
|
|
63,012
|
|
Disposal of tangible assets
|
(891)
|
|
(808)
|
|
(11)
|
|
(1,710)
|
|
Depreciation expense
|
(5,697)
|
|
(44,861)
|
|
—
|
|
(50,558)
|
|
Change in consolidation scope
|
—
|
|
5
|
|
(2)
|
|
3
|
|
Currency translation adjustments
|
298
|
|
849
|
|
230
|
|
1,377
|
|
Transfer into service
|
797
|
|
55,286
|
|
(56,083)
|
|
—
|
|
Balance at December 31, 2019
|
11,416
|
|
157,584
|
|
3,832
|
|
172,832
|
|
Gross value at end of period
|
31,561
|
|
367,557
|
|
3,832
|
|
402,950
|
|
Accumulated depreciation at end of period
|
(20,145)
|
|
(209,973)
|
|
—
|
|
(230,118)
|
|
Balance at January 1, 2020
|
11,416
|
|
157,584
|
|
3,832
|
|
172,832
|
|
Additions to tangible assets
|
675
|
|
34,119
|
|
11,536
|
|
46,330
|
|
Disposal of tangible assets
|
(2,444)
|
|
(1,339)
|
|
—
|
|
(3,783)
|
|
Depreciation expense
|
(3,343)
|
|
(52,109)
|
|
—
|
|
(55,452)
|
|
Change in consolidation scope
|
—
|
|
(10)
|
|
15
|
|
5
|
|
Currency translation adjustments
|
(557)
|
|
(4,476)
|
|
(473)
|
|
(5,506)
|
|
Transfer into service
|
216
|
|
3,151
|
|
(3,367)
|
|
—
|
|
Balance at December 31, 2020
|
5,963
|
|
136,920
|
|
11,543
|
|
154,426
|
|
Gross value at end of period
|
24,127
|
|
357,814
|
|
11,543
|
|
393,484
|
|
Accumulated depreciation at end of period
|
(18,164)
|
|
(220,894)
|
|
—
|
|
(239,058)
|
|
The increase in property plant and equipment mainly includes server equipment in the French, U.S. and Japanese subsidiaries where the Company’s data centers are located.
Note 16 – Marketable Securities
As of December 2020, €34.1 million of investments were classified as Marketable Securities, as non-current assets, as they do not meet the cash and cash equivalent criteria and are accounted for using the amortized cost model. Management has the intent to hold the investments maturity and collect interest income.The interest income was not material as of December 31, 2020.
The fair value approximates the carrying amount of the securities given the nature of the term deposit and the maturity of the expected cash flows. The term deposit is considered a level 2 financial instruments as it is measured using valuation techniques based on observable market data.
Note 17 – Non-Current Financial Assets
Non-current financial assets are mainly composed of (i) an interest-bearing bank deposit amounting to €5.6 million, which is pledged to the benefit of a bank in order to secure the first-demand bank guarantee in connection with our headquarters premises, and (ii) guarantee deposits for office rentals in France, the United Kingdom, Singapore, Spain, Japan, and the United States.
Note 18 - Leases
The components of lease expense are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2019
|
(In thousands of euros)
|
|
|
|
Offices
|
Data Centers
|
Total
|
Depreciation and impairment expense
|
|
|
|
33,988
|
|
20,678
|
|
54,666
|
|
Interest expense
|
|
|
|
3,418
|
|
789
|
|
4,207
|
|
Short term lease expense
|
|
|
|
2,051
|
|
1,631
|
|
3,682
|
|
Variable lease expense
|
|
|
|
534
|
|
—
|
|
534
|
|
Sublease income
|
|
|
|
(2,605)
|
|
—
|
|
(2,605)
|
|
Total
|
|
|
|
37,386
|
|
23,098
|
|
60,484
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2020
|
(In thousands of euros)
|
|
|
|
Offices
|
Data Centers
|
Total
|
Depreciation and impairment expense
|
|
|
|
26,183
|
|
21,871
|
|
48,054
|
|
Interest expense
|
|
|
|
1,905
|
|
619
|
|
2,524
|
|
Short term lease expense
|
|
|
|
718
|
|
294
|
|
1,012
|
|
Variable lease expense
|
|
|
|
389
|
|
—
|
|
389
|
|
Sublease income
|
|
|
|
(663)
|
|
—
|
|
(663)
|
|
Total
|
|
|
|
28,532
|
|
22,784
|
|
51,316
|
|
The right of use asset is compromised of the following items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2019
|
(In thousands of euros)
|
|
|
|
Gross Book Value
|
Amortization and Depreciation
|
Net
|
Offices
|
|
|
|
243,744
|
|
(150,919)
|
|
92,825
|
|
Data Centers
|
|
|
|
98,040
|
|
(64,798)
|
|
33,242
|
|
Total
|
|
|
|
341,784
|
|
(215,717)
|
|
126,067
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2020
|
(In thousands of euros)
|
|
|
|
Gross Book Value
|
Amortization and Depreciation
|
Net
|
Offices
|
|
|
|
109,320
|
|
(48,269)
|
|
61,051
|
|
Data Centers
|
|
|
|
60,778
|
|
(28,719)
|
|
32,059
|
|
Total
|
|
|
|
170,098
|
|
(76,988)
|
|
93,110
|
|
Changes in net book value during the presented periods are summarized below:
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
Offices
|
Data Centers
|
Total
|
|
|
|
|
Net value as of January 1, 2019
|
134,804
|
|
43,647
|
|
178,451
|
|
New contracts/modifications to existing contracts
|
(9,227)
|
|
9,734
|
|
507
|
|
Depreciation
|
(26,800)
|
|
(20,678)
|
|
(47,478)
|
|
Impairment
|
(7,719)
|
|
—
|
|
(7,719)
|
|
Currency translation adjustments
|
1,767
|
|
539
|
|
2,306
|
|
|
|
|
|
Net value as of December 31, 2019
|
92,825
|
|
33,242
|
|
126,067
|
|
New contracts/modifications to existing contracts
|
(9,031)
|
|
21,954
|
|
12,923
|
|
Depreciation
|
(24,924)
|
|
(21,871)
|
|
(46,795)
|
|
Impairment
|
5,131
|
|
—
|
|
5,131
|
|
Currency translation adjustments
|
(2,950)
|
|
(1,266)
|
|
(4,216)
|
|
|
|
|
|
Net value as of December 31, 2020
|
61,051
|
|
32,059
|
|
93,110
|
|
The lease liability is compromised of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2019
|
(In thousands of euros)
|
|
|
|
Offices
|
Data Centers
|
Total
|
Long term lease liabilities
|
|
|
|
85,120
|
|
21,210
|
|
106,330
|
|
Short term lease liabilities
|
|
|
|
24,940
|
|
15,936
|
|
40,876
|
|
Total
|
|
|
|
110,060
|
|
37,146
|
|
147,206
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2020
|
(In thousands of euros)
|
|
|
|
Offices
|
Data Centers
|
Total
|
Long term lease liabilities
|
|
|
|
52,526
|
|
15,485
|
|
68,011
|
|
Short term lease liabilities
|
|
|
|
20,606
|
|
19,722
|
|
40,328
|
|
Total
|
|
|
|
73,132
|
|
35,207
|
|
108,339
|
|
As of December 31, 2020, the future minimum lease payments were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
Offices
|
Data Centers
|
Total
|
|
|
|
|
2021
|
26,346
|
|
21,114
|
|
47,460
|
|
2022
|
24,769
|
|
10,214
|
|
34,983
|
|
2023
|
15,845
|
|
3,881
|
|
19,726
|
|
2024
|
7,394
|
|
1,993
|
|
9,387
|
|
2025
|
6,320
|
|
333
|
|
6,653
|
|
2026 et au-delà
|
2,124
|
|
—
|
|
2,124
|
|
Total
|
82,798
|
|
37,535
|
|
120,333
|
|
As of December 31, 2020, we have additional leases, primarily for data centers, that have not yet commenced which will result in additional operating lease liabilities and right of use assets of approximately €6.4 million. These operating leases will commence in 2021.
Note 19 - Trade Receivables
The following table shows the breakdown in trade receivables net book value for the presented periods:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Trade accounts receivables
|
|
|
|
436,524
|
|
443,105
|
|
418,848
|
|
Less provision for credit losses
|
|
|
|
(22,637)
|
|
(17,465)
|
|
(32,527)
|
|
Net book value at end of period
|
|
|
|
413,887
|
|
425,640
|
|
386,321
|
|
Changes in allowance for doubtful accounts are summarized below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Balance at beginning of period
|
|
|
|
(17,359)
|
|
(22,637)
|
|
(17,465)
|
|
Provision for doubtful accounts
|
|
|
|
(14,964)
|
|
(13,055)
|
|
(27,009)
|
|
Reversal of provision
|
|
|
|
10,129
|
|
18,591
|
|
10,127
|
|
Change in consolidation scope
|
|
|
|
(132)
|
|
—
|
|
—
|
|
Currency translation adjustment
|
|
|
|
(311)
|
|
(364)
|
|
1,820
|
|
Balance at end of period
|
|
|
|
(22,637)
|
|
(17,465)
|
|
(32,527)
|
|
The change in the allowance for credit losses for the twelve months ended December 31, 2020 is due to the expected impact of COVID-19 on the Company's future cash collections caused by the downturn in the economy which has led to financial difficulties for some of our customers, particularly those operating in the retail sector. In times of the global economic turmoil, brought about by COVID-19, the estimates and judgments with respect to the collectability of the receivables are subject to greater uncertainty than in more stable periods.
Note 20 – Other Current Assets
The following table shows the breakdown in other current assets net book value for the presented periods:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Prepayments to suppliers
|
|
|
|
3,542
|
|
4,547
|
|
4,574
|
|
Employee-related receivables
|
|
|
|
197
|
|
249
|
|
147
|
|
Taxes receivables
|
|
|
|
46,584
|
|
54,232
|
|
57,035
|
|
Other debtors
|
|
|
|
3,454
|
|
3,087
|
|
3,770
|
|
Prepaid expenses
|
|
|
|
10,738
|
|
7,024
|
|
7,940
|
|
Derivatives
|
|
|
|
1,487
|
|
—
|
|
—
|
|
Gross book value at end of period
|
|
|
|
66,002
|
|
69,139
|
|
73,466
|
|
|
|
|
|
|
|
|
Net book value at end of period
|
|
|
|
66,002
|
|
69,139
|
|
73,466
|
|
Taxes receivables are primarily composed of VAT receivables and research tax credit receivables. Prepaid expenses mainly consist of office rental advance payments.
Note 21 – Cash and Cash Equivalents
Consolidated Statement of the Financial Position
The following table presents for each reported period, the breakdown of cash and cash equivalents :
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Interest-bearing bank deposits
|
|
|
|
109,556
|
|
168,345
|
|
132,391
|
|
Cash & cash equivalents
|
|
|
|
208,720
|
|
204,406
|
|
265,393
|
|
Total Cash & cash equivalents
|
|
|
|
318,276
|
|
372,751
|
|
397,784
|
|
The short-term investments included investments in money market funds and interest–bearing bank deposits which met IAS 7 — Statement of Cash Flow criteria: short-term, highly liquid investments, for which the risks of changes in value are considered to be insignificant.
Interest-bearing bank deposits are considered level 2 financial instruments as they are measured using valuation techniques based on observable market data. For the cash and cash equivalents, the fair value approximates the carrying amount, given the nature of the cash and cash equivalents and the maturity of the expected cash flows.
Consolidated Statement of Cash Flow
The breakdown of cash & cash equivalents presented in the Consolidated Statement of Cash Flow can be reconciled with the financial statement position as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Cash & cash equivalents
|
|
|
|
318,276
|
|
372,751
|
|
397,784
|
|
Net cash and cash equivalents
|
|
|
|
318,276
|
|
372,751
|
|
397,784
|
|
Note 22 – Common shares
The Group manages its capital to ensure that entities in the Company will be able to continue as a going concern while maximizing the return to shareholders through the optimization of the debt and equity balance.
Our capital structure consists of financial liabilities (net debt) and equity (issued capital, reserves, retained earnings and non-controlling interests).
The Group is not subject to any externally imposed capital requirements.
Change in Number of Shares
|
|
|
|
|
|
Change in number of shares
|
Number of ordinary shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2019
|
64,249,084
|
|
of which Common stock
|
67,708,203
|
|
of which Treasury stock
|
(3,459,119)
|
|
Issuance of shares under share option and free share plans (1)
|
83,266
|
|
Treasury shares retired (2)
|
(1,594,288)
|
|
Share repurchase program (see note 4)
|
(444,554)
|
|
Balance at December 31, 2019
|
62,293,508
|
|
of which Common stock
|
66,197,181
|
|
of which Treasury stock
|
(3,903,673)
|
|
Issuance of shares under share option and free share plans (3)
|
231,784
|
|
Storetail deferred consideration
|
(156,859)
|
|
Share repurchase program (see Note 4)
|
(1,728,863)
|
|
Balance at December 31, 2020
|
60,639,570
|
|
of which Common stock
|
66,272,106
|
|
of which Treasury stock
|
(5,632,536)
|
|
(1) Approved by the board of directors on March 1, 2019, April 25, 2019, June 25, 2019, July 25, 2019, October 24, 2019 and December 11, 2019.
(2) On February 8th, 2019, the board of directors acknowledged the share capital decrease resulting from the cancellation of 1,594,288 shares and approved the related amendment of Article 6 of the Company’s by-laws reflecting such decrease.
(3) Approved by the board of directors on March 3, 2020, April 23, 2020, June 22, 2020, July 23, 2020, October 23, 2020 and December 9, 2020.
Note 23 – Earnings Per Share
Basic Earnings Per Share
The Group calculates basic earnings per share by dividing the net income for the period attributable to shareholders of the Parent company by the weighted average number of shares outstanding.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Net income attributable to shareholders of Criteo S.A.
|
|
|
|
75,304
|
|
77,120
|
|
63,554
|
|
Weighted average number of shares outstanding
|
|
|
|
66,456,890
|
|
64,305,965
|
|
60,876,480
|
|
Basic earnings per share
|
|
|
|
1.13
|
€
|
1.20
|
€
|
1.04
|
€
|
Diluted Earnings Per Share
The Group calculates diluted earnings per share by dividing the net income attributable to shareholders of the Parent company by the weighted average number of shares outstanding plus any potentially dilutive shares not yet issued from share-based compen sation plans (see note 9). There were no other potentially dilutive instruments outstanding as of December 31, 2018, 2019 and 2020. Consequently all potential dilutive effects from shares are considered.
For each period presented, a contract to issue a certain number of shares (i.e. share option, share warrant, restricted share award or BSPCE contracts) is assessed as potentially dilutive, if it is “in the money” (i.e., the exercise or settlement price is inferior to the average market price).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Net income attributable to shareholders of Criteo S.A.
|
|
|
|
75,304
|
|
77,120
|
|
63,554
|
|
Weighted average number of shares outstanding of Criteo S.A.
|
|
|
|
66,456,890
|
|
64,305,965
|
|
60,876,480
|
|
Dilutive effect of :
|
|
|
|
938,163
|
|
1,240,725
|
|
670,725
|
|
- Restricted share awards
|
|
|
|
550,736
|
|
932,694
|
|
572,559
|
|
- Share options (OSA) and BSPCE
|
|
|
|
348,566
|
|
271,756
|
|
88,321
|
|
- Share warrants
|
|
|
|
38,861
|
|
36,276
|
|
9,845
|
|
Weighted average number of shares outstanding used to determine diluted earnings per share
|
|
|
|
67,395,053
|
|
65,546,690
|
|
61,547,205
|
|
|
|
|
|
|
|
|
Diluted earnings per share
|
|
|
|
1.12
|
€
|
1.18
|
€
|
1.03
|
€
|
Note 24 – Employee Benefits
Defined Benefit Plans
According to the French law and the Syntec Collective Agreement, French employees are entitled to compensation paid on retirement.
The following table summarizes the changes in the projected benefit obligation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Defined Benefit Obligation present value - Beginning of period
|
|
|
|
4,293
|
|
4,835
|
|
7,553
|
|
Service cost
|
|
|
|
1,431
|
|
1,390
|
|
1,954
|
|
Finance cost
|
|
|
|
73
|
|
101
|
|
83
|
|
Actuarial losses (gains)
|
|
|
|
(1,046)
|
|
1,227
|
|
(4,564)
|
|
Change in consolidation scope
|
|
|
|
84
|
|
—
|
|
—
|
|
Defined Benefit Obligation present value - End of period
|
|
|
|
4,835
|
|
7,553
|
|
5,026
|
|
The Company does not hold any plan assets for any of the periods presented.
The reconciliation of the changes in the present value of projected benefit obligation with the Consolidated Statement of Income for the presented periods is illustrated in the following table:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Service cost
|
|
|
|
(1,431)
|
|
(1,390)
|
|
(1,954)
|
|
- Research and development expense
|
|
|
|
(715)
|
|
(679)
|
|
(975)
|
|
- Sales and operations expense
|
|
|
|
(274)
|
|
(253)
|
|
(345)
|
|
- General and administrative expense
|
|
|
|
(442)
|
|
(458)
|
|
(634)
|
|
Finance cost
|
|
|
|
(73)
|
|
(101)
|
|
(83)
|
|
- Finance income (expense)
|
|
|
|
(73)
|
|
(101)
|
|
(83)
|
|
Actuarial (losses) gains
|
|
|
|
1,046
|
|
(1,227)
|
|
4,565
|
|
- Other comprehensive (loss) income
|
|
|
|
1,046
|
|
(1,227)
|
|
4,565
|
|
The main assumptions used for the purposes of the actuarial valuations are listed below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Discount rate (Corp AA)
|
|
|
|
2.10
|
%
|
1.10
|
%
|
0.85
|
%
|
Expected rate of salary increase
|
|
|
|
5.00
|
%
|
5.00
|
%
|
5.00
|
%
|
Expected rate of social charges
|
|
|
|
49% - 50%
|
49% - 50%
|
49% - 50%
|
Estimated retirement age
|
|
|
|
Table progressive
|
Table progressive
|
Table progressive
|
Life table
|
|
|
|
TH-TF 2000-2002 shifted
|
TH-TF 2000-2002 shifted
|
TH-TF 2000-2002 shifted
|
Staff turnover assumptions
|
|
|
|
0 - 10.5%
|
0 - 10.5%
|
0 - 17.8%
|
Defined Contribution Plans
The total expense represents contributions payable to these plans by us at specified rates.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Defined contributions plans included in personnel expenses
|
|
|
|
(14,324)
|
|
(14,011)
|
|
(14,201)
|
|
Note 25 – Financial Liabilities
The changes in current and non-current financial liabilities during the periods ended December 31, 2020 are illustrated in the following schedules:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
December 31, 2019
|
New borrowings
|
Repayments
|
Change in scope
|
Other (2)
|
Currency translation adjustment
|
December 31, 2020
|
Borrowings (1)
|
300
|
|
—
|
|
—
|
|
—
|
|
(300)
|
|
—
|
|
—
|
|
Other financial liabilities
|
384
|
|
279
|
|
—
|
|
—
|
|
(340)
|
|
(8)
|
|
315
|
|
Non current portion
|
684
|
|
279
|
|
—
|
|
—
|
|
(640)
|
|
(8)
|
|
315
|
|
Borrowings (1)
|
1,579
|
|
140,000
|
|
(141,180)
|
|
533
|
|
300
|
|
(7)
|
|
1,225
|
|
Other financial liabilities
|
514
|
|
16
|
|
(474)
|
|
—
|
|
340
|
|
(21)
|
|
375
|
|
Derivatives
|
1,143
|
|
—
|
|
—
|
|
—
|
|
(389)
|
|
—
|
|
754
|
|
Current portion
|
3,236
|
|
140,016
|
|
(141,654)
|
|
533
|
|
251
|
|
(28)
|
|
2,354
|
|
Borrowings (1)
|
1,879
|
|
140,000
|
|
(141,180)
|
|
533
|
|
—
|
|
(7)
|
|
1,225
|
|
Other financial liabilities
|
898
|
|
295
|
|
(474)
|
|
—
|
|
—
|
|
(29)
|
|
690
|
|
Derivatives
|
1,143
|
|
—
|
|
—
|
|
—
|
|
(389)
|
|
—
|
|
754
|
|
Total
|
3,920
|
|
140,295
|
|
(141,654)
|
|
533
|
|
(389)
|
|
(36)
|
|
2,669
|
|
(1) includes accrued interest
(2) Includes reclassification from non-current to current portion based on maturity of financial liabilities
We are party to several loan agreements and revolving credit facilities, or RCF, with third-party financial institutions. Our loans and RCF agreements are presented in the table below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date
|
Nominal/ Authorized amounts (in thousands of euros)
|
Amount drawn
|
Balance as of December 31, 2020 (in thousands of euros)
|
Interest rate
|
Settlement date
|
BPI loan
|
|
|
|
|
|
February 20, 2014
|
N/A
|
N/A
|
€
|
300
|
|
Fixed: 2,09%
|
May 2021
|
Other
|
N/A
|
N/A
|
€
|
743
|
|
—
|
|
2023 and after
|
Other loans
|
|
|
|
|
|
|
N/A
|
N/A
|
€
|
183
|
|
—
|
|
2024
|
Bank syndicate RCF - Criteo SA
|
|
|
|
|
|
September 24, 2015
|
€
|
350,000
|
|
—
|
|
—
|
|
Floating rate : EURIBOR/LIBOR + margin depending on leverage ratio
|
March 2022
|
(1) Subsequent to the settlement date of March 2022, the authorized amount of €350 million is reduced to €294 million through to a new settlement date of March 2023
On September 24, 2015, Criteo entered into a five year revolving credit facility for general corporate purposes, including acquisitions, for a maximum amount of €250 million, with a bank syndicate composed of Natixis (coordinator and documentation agent), Le Credit Lyonnais (LCL) (facility agent), HSBC France, Société Générale Corporate & Investment Banking and BNP Paribas (each acting individually as bookrunners and mandated lead arrangers). This multi-currency revolving credit facility bears interest rate at Euribor or the relevant Libor plus a margin to be adjusted on the basis of the leverage ratio. The agreement contains clauses relating to prepayments, indemnities, representations, commitments (ratio of net debt to adjusted EBITDA, restrictions in the event of new debt) and default.
In 2017, this agreement was amended by, among other things, increasing the amount of facility from €250.0 million to €350.0 million and extending the term of the contract from 2020 to 2022. In 2020, the parties to the RCF agreement have agreed to extend the term of the agreement for one additional year, from March 2022 to March 2023, composed of a €350 million commitment through March 2022 and a €294 million commitment from the end of March 2022 through March 2023.
In February 2014, Criteo entered into a credit line with Bpifrance Financement (French Public Investment Bank) to finance the development of the Group. The credit line had a drawn down of €3.0 million, for a period of seven years, repayable quarterly after a period of two years. As of December 31, 2020, the balance on the credit line is €1.0 million.
These loans include special clauses in the event of default, but do not contain any affirmative, financial or negative covenants, with the exception of the €350.0 million revolving credit facility . This facility contains a covenant which was in compliance as of December 31, 2020.
Note 26 – Net debt
The company net debt is calculated by offsetting the cash and cash equivalents from the financial liabilities.
As shown in note 5 and 21, the market risk is monitored by management, who define the management policy regarding the consolidated net debt in terms of liquidity, interest rates, exchange rates and counterparty risk for the upcoming months and analyzes the previous events (realized transactions, financial results).
The following tables show the maturity and allocation by currency of our financial liabilities and cash and cash equivalents.
Net debt by maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
Carrying
value
|
Maturity
|
2021
|
2022
|
2023
|
2024
|
2025
|
Borrowings (1)
|
1,227
|
|
1,227
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Other financial liabilities
|
688
|
|
373
|
|
36
|
|
—
|
|
—
|
|
279
|
|
Derivatives
|
754
|
|
754
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Financial liabilities
|
2,669
|
|
2,354
|
|
36
|
|
—
|
|
—
|
|
279
|
|
Cash and cash equivalents
|
(397,784)
|
|
(397,784)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Net financial debt
|
(395,115)
|
|
(395,430)
|
|
36
|
|
—
|
|
—
|
|
279
|
|
(1) includes accrued interest
Net debt by currency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
Carrying
value
|
Currency
|
EUR
|
GBP
|
USD
|
|
JPY
|
KRW
|
Others
|
Borrowings (1)
|
1,227
|
|
1,227
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
Other financial liabilities
|
688
|
|
327
|
|
310
|
|
51
|
|
|
—
|
|
—
|
|
—
|
|
Derivatives
|
754
|
|
754
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
Financial liabilities
|
2,669
|
|
2,308
|
|
310
|
|
51
|
|
|
—
|
|
—
|
|
—
|
|
Cash and cash equivalents
|
(397,784)
|
|
(297,317)
|
|
(10,671)
|
|
(38,454)
|
|
|
(24,923)
|
|
(7,670)
|
|
(15,482)
|
|
Net financial debt
|
(395,115)
|
|
(295,009)
|
|
(10,361)
|
|
(38,403)
|
|
|
(24,923)
|
|
(7,670)
|
|
(15,482)
|
|
(1) includes accrued interest
Note 27 – Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
Provision for employee related litigation
|
|
Other provisions
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at January 1, 2019
|
216
|
|
|
2,089
|
|
2,305
|
|
Charges
|
412
|
|
|
3,391
|
|
3,803
|
|
Provision used
|
(73)
|
|
|
—
|
|
(73)
|
|
Provision released not used
|
—
|
|
|
(359)
|
|
(359)
|
|
Currency translation adjustments
|
—
|
|
|
5
|
|
5
|
|
Balance at December 31, 2019
|
555
|
|
|
5,126
|
|
5,681
|
|
Charges
|
444
|
|
|
870
|
|
1,314
|
|
Provision used
|
—
|
|
|
(728)
|
|
(728)
|
|
Provision reversed not used (*)
|
(29)
|
|
|
(1,935)
|
|
(1,964)
|
|
Currency translation adjustments
|
(6)
|
|
|
(119)
|
|
(125)
|
|
Other (**)
|
—
|
|
|
(2,345)
|
|
(2,345)
|
|
Balance at December 31, 2020
|
964
|
|
|
869
|
|
1,833
|
|
of which current
|
964
|
|
|
869
|
|
1,833
|
|
|
|
|
|
|
(*) Due to revised estimate
(**) Transferred to tax payables following receipt of the notification confirming amount due
The amount of the provisions represent management’s best estimate of the future outflow.
Note 28 – Other current liabilities
Other current liabilities are presented in the following table:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Clients’ prepayments
|
|
|
|
9,020
|
|
12,120
|
|
9,973
|
|
Credit notes
|
|
|
|
11,514
|
|
14,616
|
|
11,762
|
|
Employee-related payables
|
|
|
|
57,536
|
|
66,566
|
|
69,491
|
|
Taxes payable
|
|
|
|
47,433
|
|
43,477
|
|
46,549
|
|
Accounts payable relating to capital expenditures
|
|
|
|
18,961
|
|
4,159
|
|
4,885
|
|
Other creditors
|
|
|
|
1,111
|
|
845
|
|
522
|
|
Deferred revenue
|
|
|
|
544
|
|
202
|
|
68
|
|
Total
|
|
|
|
146,119
|
|
141,985
|
|
143,250
|
|
Note 29 – Commitments and contingencies
Purchase Obligations
As of December 31, 2020, the Group had €5.0 million of other non-cancellable contractual obligations, primarily related to software licenses, maintenance and €0.4 million bandwidth for the servers.
Revolving Credit Facilities, Credit Lines Facilities and Bank Overdrafts
As mentioned in Note 25, Criteo is party to an RCF with a syndicate of banks which allow us to draw up to €350.0 million as of December 31, 2020.
The Group also has short-term credit lines and overdraft facilities with HSBC plc, BNP Paribas and LCL. Criteo is authorized to draw up to a maximum of €21.5 million in the aggregate under the short-term credit lines and overdraft facilities. As of December 31, 2020, Criteo had not drawn on any of these facilities. Any loans or overdraft under these short-term facilities bear interest based on the one month EURIBOR rate or three month EURIBOR rate. As these facilities are exclusively short-term credit and overdraft facilities, our banks have the ability to terminate such facilities on short notice. The short-term facilities also include special clauses in the event of default, but are not subject to guarantees and covenants.
All of these loans and revolving credit facilities are unsecured and contain customary events of default but do not contain any affirmative, financial or negative covenants, with the exception of the €350.0 million revolving credit facility which contains covenants, including compliance with a total net debt to adjusted EBITDA ratio and restrictions on the incurrence of additional indebtedness. At December 31, 2020, we were in compliance with the required leverage ratio.
Note 30 – Related Parties
On March 2, 2020, the Group announced that Chief Financial Officer Benoit Fouilland plans to depart from Criteo at the end of the second quarter 2020.
On May 15, 2020, the Group announced the appointment of Dave Anderson as the Company’s Interim Chief Financial Officer for a six-month term in replacement of Benoit Fouilland, effective May 18, 2020. During his engagement, Mr. Anderson was also the Company’s Principal Financial Officer and Principal Accounting Officer. Mr. Fouilland departed Criteo on June 30, 2020.
On August 31, 2020, the Group announced that Jean-Baptiste Rudelle, Criteo's co-founder and former CEO, has stepped down from Criteo's Board of Directors effective August 27, 2020. Mr. Rudelle had previously stepped down from the day to day activities as CEO in November 2019, and as Chairman of the Board in July 2020.Also effective August 27, 2020, CEO Megan Clarken has been appointed to the Board of Directors.
On September 3, 2020, the Group announced the appointment of Sarah Glickman as the Company's Chief Financial Officer and Principal Accounting Officer, effective September 8, 2020, replacing Dave Anderson who served as interim Chief Financial Officer for four months.
The Executive Officers as of December 31, 2020 were:
•Megan Clarken - Chief Executive Officer
• Sarah Glickman - Chief Financial Officer and Principal Accounting Officer
•Ryan Damon - General Counsel and Corporate Secretary
Total compensation for the Executive Officers, including social contributions, is summarized in the following table:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands of euros)
|
|
|
|
December 31, 2018
|
December 31, 2019
|
December 31, 2020
|
Short-term benefits (1)
|
|
|
|
(3,743)
|
|
(3,421)
|
|
(2,959)
|
|
Long-term benefits (2)
|
|
|
|
(40)
|
|
(40)
|
|
(20)
|
|
Share-based compensation
|
|
|
|
(6,787)
|
|
(4,113)
|
|
(1,842)
|
|
Total
|
|
|
|
(10,570)
|
|
(7,574)
|
|
(4,821)
|
|
1) Wages, bonuses and other compensations
2) Pension defined benefit plan
For the year ended December 31, 2018, 2019 and 2020, there were no material related party transactions.
Note 31 – Subsequent Events
On February 5, 2021 Criteo announced that its Board of Directors has authorized a share repurchase program of up to $100,0 million (€81,5 million) of the Company’s outstanding American Depositary Shares.The Company intends to use any repurchased shares under this new authorization to satisfy employee equity obligations in lieu of issuing new shares, which would limit future dilution for its shareholders.
APPENDIX A
Please note that because we are a French company, the full text of the plan has been translated from French. In the case of any discrepancy between this version and the French version, the French version will prevail.
CRITEO
AMENDED 2016 STOCK OPTION PLAN
Adopted by the Board on April 7, 2016
Approved by the Company’s combined shareholders’ general meeting of June 29, 2016
Amended from time to time. Last amendment by the Board: April 7, 2021
Exhibit A – Sub-Plan for Israeli Beneficiaries
Exhibit B – Stock Option Grant Agreement
Part I – Notice of Stock Option Grant
Part II – Terms and Conditions
CRITEO
AMENDED 2016 STOCK OPTION PLAN
1. Purpose of the Plan
Pursuant to its decision, taken on April 7, 2016 as approved by the Company’s combined shareholders’ general meeting of June 29, 2016, the Board decided, in compliance with the provisions of articlesL. 225−177 et. seq. of the French Commercial Code, to adopt the 2016 stock option plan of the Company (the “Criteo 2016 Stock Option Plan”), the terms and conditions of which, as amended by the Board from time to time, are set out below.
The purpose of the Plan is to:
•attract and retain the best available personnel for positions of substantial responsibility;
•provide additional incentive to Beneficiaries; and
•promote the success of the Company’s business.
Options granted under the Plan to U.S. Beneficiaries are intended to be Incentive Stock Options or Non−Statutory Stock Options, as determined by the Administrator at the time of grant of an Option, and shall comply in all respects with Applicable Laws in order that they may benefit from available tax advantages.
2. Definitions
(a) “Administrator” means the Board, which shall administer the Plan in accordance with Section 4 of the Plan.
(b) “Affiliated Company” means an entity which conforms with the criteria set forth in article L. 225−180 of the French Commercial Code as follows:
•entities of which at least ten percent (10%) of the share capital or voting rights are held directly or indirectly by the Company;
•entities which own directly or indirectly at least ten percent (10%) of the share capital or voting rights of the Company; and
•entities of which at least fifty percent (50%) of the share capital or voting rights are held directly or indirectly by a company which owns directly or indirectly at least fifty percent (50%) of the share capital or voting rights of the Company.
(c) “Agreed Leave” means any leave of absence having received a prior approval from the Company or, in the case of a U.S. Beneficiary, requiring no prior approval under U.S. laws or, in the case of a U.K. Beneficiary, requiring no prior approval under applicable U.K. laws. Leaves of absence requiring prior approval from the Company shall include leaves of more than three (3) months for illness or conditions about which the employee has advance knowledge, military leave, and any other personal leave. Agreed Leave shall not include any absence considered as effective working time, such as maternity leave of whatever duration, which shall also not terminate the employment relationship between the Beneficiary and the Company or any Affiliated Company. Notwithstanding the foregoing, for
purposes of U.S. Beneficiaries and Incentive Stock Options, no such leave may exceed three (3) months, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment upon expiration of an Agreed Leave is not so guaranteed, on the 91st day of such leave any Incentive Stock Option held by a U.S. Beneficiary shall cease to be treated as an Incentive Stock Option and shall be treated for U.S. tax purposes as a Non-Statutory Stock Option.
(d) “Applicable Laws” means for the U.S., the legal requirements related to the administration of stock option plans under federal and state corporate and securities laws, including requirements of any exchange or quotation system on which the Shares may then be listed or quoted, and the Code in force in the United States of America.
(e) “Beneficiary” means the chairman of the board of directors (président du conseil d’administration), the general manager (directeur général) and the deputy general managers (directeurs généraux délégués) or, as the case may be, the chairman and the members of the management board (président et membres du directoire) of the Company as well as any individual employed by the Company or by any Affiliated Company under the terms and conditions of an employment contract or otherwise, it being specified that a term of office of director of the Company or director of an Affiliated Company (remunerated or not) shall not be deemed to constitute an employment relationship.
(f) “Board” means the board of directors of the Company.
(g) “Change in Control” means (i) a merger (fusion) of the Company with or into another corporation, other than to another corporation, entity or person in which the holders of at least a majority of the voting rights and share capital of the Company outstanding immediately prior to such transaction continue to hold (either by such shares remaining outstanding in the continuing entity or by being converted into shares of voting rights and share capital of the surviving entity) a majority of the total voting rights and share capital of the Company (or the surviving entity) outstanding immediately after such transaction (an “Excluded Entity”), or (ii) the sale (vente) or other form of transfer by one or several shareholders of the Company to any person or group of persons of a number of Shares such that the transferee(s) shall own a majority of the voting rights and share capital of the Company, or (iii) the sale, lease or other disposition, in a single transaction or in a series of related transactions, of all or substantially all of the assets of the Company other than to (1) a corporation or other entity of which at least a majority of its combined voting rights and share capital is owned directly or indirectly by the Company or (2) an Excluded Entity.
(h) “Code” means the United States Internal Revenue Code of 1986, as amended, including rules, regulations and guidance promulgated thereunder and successor provisions and rules and regulations thereto.
(i) “Company” means CRITEO, a société anonyme organized under the laws of the Republic of France, having its registered office located at 32 rue Blanche, 75009 Paris, France and registered with the trade and companies registry under number 484 786 249 RCS Paris.
(j) “Continuous Status as a Beneficiary” means as regards the chairman of the board of directors, the general manager, the deputy general manager(s) or, as the case may be, the chairman and the members of the management board, that the term of their office has not been terminated and, as regards an employee, that the employment relationship between the Beneficiary and the Company or any Affiliated Company is not terminated. Continuous Status as a Beneficiary shall not be considered terminated in the case of an (i) Agreed Leave or (ii) transfers between locations of the Company or
between the Company or any Affiliated Company or the contrary or also from an Affiliated Company to another Affiliated Company.
(k) “Date of Grant” means the date of the decision of the Board to grant the Options.
(l) “Disability” means a disability declared further to a medical examination provided for in article R. 4624−21 of the French Labour Code or pursuant to any similar provision applicable to a foreign Affiliated Company or Beneficiary.
(m) “Exchange Act” means the United States Securities Exchange Act of 1934, as amended.
(n) “Fair Market Value” means the value for one Share as determined in good faith by the Administrator, according to the following provisions, as provided in the Shareholders Authorization:
(i) the Board may determine the subscription or purchase price of a share by reference to the closing sales price of one American Depositary Share representing one Share (“ADS”) on the Nasdaq Global Market for the day prior to the day of the decision of the Board to grant the Options, converted to Euros in the manner established by the Board. However, the purchase or subscription price shall in no case be less than ninety five percent (95%) of the average of the closing sales price for an ADS as quoted on said stock exchange market during the twenty market trading days prior to the Date of Grant; provided that, when an Option allows its holder to purchase Shares which have been previously purchased by the Company, then in addition to the minimum price stated above in this Section 2(n)(i) and in accordance with applicable law, the exercise price of such Option may not be less than eighty percent (80%) of the average price paid by the Company for the purchase of the treasury Shares.
(ii) for U.S. Beneficiaries, the subscription or purchase price shall not be less than the fair market value of the Shares on the Date of Grant, determined as follows (a) if the Shares, or ADSs representing the Shares, are listed or quoted for trading on an exchange, the value will be deemed to be the closing sales price of the Shares or ADSs, as applicable, on the principal exchange upon which such securities are traded or quoted on the day prior to the day of the decision of the Board to grant the Options, provided, if such date is not a trading day, on the last market trading day prior to such date; and (b) if the Shares or ADSs representing the Shares are not listed or quoted for trading on an exchange, the fair market value of the Shares as determined by the Board, consistent with the requirements of Section 422 with respect to Incentive Stock Options, and Section 409A of the Code with respect to Options not intended to be Incentive Stock Options.
Except as provided in Sections 11 and 12 of the Plan, the subscription or purchase price of Shares shall not be modified during the period in which the Option may be exercised. However, if the Company carries out any of the actions mentioned in article L. 225−181 of the French Commercial Code, it must take all necessary measures to protect Optionees’ interests in accordance with article L. 228−99 of the French Commercial Code. In the case of issuance of securities giving access to the share capital (valeurs mobilières donnant accès au
capital), as well as in case of Company’s merger or scission, the Board may decide, for a limited period of time, to suspend the exercisability of the Options.
(o) “Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code.
(p) “Non-Statutory Stock Option” means an Option which does not qualify as an Incentive Stock Option.
(q) “Notice of Grant” means a written notice evidencing the main terms and conditions of an individual Option grant. The Notice of Grant is part of the Option Agreement.
(r) “Option” means an option to purchase or subscribe for Shares granted pursuant to the Plan.
(s) “Optionee” means a Beneficiary who holds at least one outstanding Option.
(t) “Option Agreement” means a written agreement entered into between the Company and an Optionee evidencing the terms and conditions of an individual Option grant. The Option Agreement is subject to the terms and conditions of the Plan.
(u) “Parent” means a “parent corporation”, whether now or hereafter existing, as defined in Section 424(e) of the Code.
(v) “Plan” means the Criteo 2016 Stock Option Plan as adopted by the Board on April 7, 2016 and approved by the Company’s combined shareholders’ general meeting of June 29, 2016, and amended from time to time by the Board, including on April 25, 2019, April 23, 2020 and April 7, 2021.
(w) “Share” means one ordinary share (action ordinaire) of the Company or an American Depositary Share representing one Share on the Nasdaq Global Market.
(x) “Share Capital” means the issued and paid up capital of the Company.
(y) “Shareholders Authorization” means the authorization given by the shareholders of the Company in the extraordinary general meeting held on June 29, 2016, as increased, amended or replaced from time to time by a further general meeting of the shareholders permitting the Board to grant Options.
(z) “Subsidiary” means a “subsidiary corporation”, whether now or hereafter existing, as defined in Section 424(f) of the Code.
(aa) “U.K. Beneficiary” means a Beneficiary of the Company or an Affiliated Company residing in the U.K. or otherwise subject to U.K. laws, regulations or taxation.
(bb) “U.S. Beneficiary” means a Beneficiary of the Company or an Affiliated Company residing in the United States or otherwise subject to United States’ laws, regulations or taxation.
3. Shares Subject to the Plan
(a) Number of Shares Available for Grants.
(i) Subject to the provisions of Sections 11 and 12 of the Plan, the maximum aggregate number of Shares which may be optioned and issued under the Plan shall not exceed the number of shares remaining available for issuance under the Shareholders Authorization. Subject to the foregoing, for Incentive Stock Options, the maximum number of Shares which may be optioned and issued is equal to 4,600,000. The Shares optioned and issued under the Plan may be newly issued Shares, treasury Shares or Shares purchased on the open market.
(ii) Except as provided in Section 11(a), no Beneficiary shall be granted, within any fiscal year of the Company, Options in respect of more than 2,200,000 Shares.
(iii) Should the Option expire or become unexercisable for any reason without having been exercised in full, the unsubscribed Shares which were subject thereto shall, unless the Plan shall have been terminated, become available again for future grant under the Plan.
(iv) For avoidance of doubt, the following Shares shall be deemed delivered for purposes of the limits set forth in Section 3(a)(i) and shall not be available for future grants of Options under the Plan: (1) Shares delivered by an Optionee (by either actual delivery or by attestation) or withheld by the Company in payment of the subscription price or exercise price of an Option and/or any applicable tax withholding obligations relating to an Option; and (2) Shares purchased on the open market by the Company with the cash proceeds received from the exercise of Options.
4. Administration of the Plan
(a) General.
The Plan shall be administered by the Administrator.
(b) Powers of the Administrator.
Subject to the provisions of the French Commercial Code, the Shareholders Authorization, the Plan, and the Applicable Laws, the Administrator shall have the authority, in its discretion:
(i) to determine the Fair Market Value of the Shares, in accordance with Section 2(n) of the Plan;
(ii) to determine the Beneficiaries to whom Options may be granted hereunder;
(iii) to select the Beneficiaries and determine whether and to what extent Options are granted hereunder;
(iv) to approve or amend forms of Option Agreement for use under the Plan;
(v) to determine the terms and conditions of any Options granted hereunder, consistent with Plan terms. Such terms and conditions include, but are not limited to, the exercise price, the time or times when Options may be exercised (which may be based on performance criteria), any vesting acceleration or waiver
of forfeiture restrictions, and any restriction or limitation regarding any Option or the Shares relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine with the exception of the exercise price; it being specified that the Administrator’s discretion remains subject to the rules and limitations set forth in this Plan and in the French Commercial Code;
(vi) to construe and interpret the terms of the Plan and Options granted pursuant to the Plan;
(vii) to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub−plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws;
(viii) to modify or amend each Option (subject to the provisions of Section 14(c) of the Plan), including, without limitation, the discretionary authority to accelerate the vesting of Options, to allow for Options to continue to vest after an Optionee’s termination of Continuous Status as a Beneficiary, or to extend the post−termination exercise period of Options after the termination of the employment agreement or the end of the term of office longer than is otherwise provided for in the Plan, but in no event beyond the original Option term;
(ix) to authorize any person to execute on behalf of the Company any instrument required to effect the grant of an Option previously granted by the Administrator;
(x) to determine the terms and restrictions applicable to Options; and
(xi) to make all other determinations deemed necessary or appropriate for administering the Plan.
(c) Effect of Administrator’s Decision.
The Administrator’s decisions, determinations and interpretations shall be final and binding on all Optionees and any other concerned parties.
5. Limitations
(a) U.S. Beneficiaries.
(i) In the case of U.S. Beneficiaries, each Option shall be designated in the Notice of Grant either as an Incentive Stock Option or as a Non−Statutory Stock Option. Incentive Stock Options may only be granted to Beneficiaries who meet the definition of “employees” under Section 3401(c) of the Code of the Company or a Parent or Subsidiary of the Company.
(ii) The aggregate Fair Market Value of the Shares covered by Incentive Stock Options granted under the Plan or any other stock option program of the Company (or any Parent or Subsidiary of the Company) that become exercisable for the first time in any calendar year shall not exceed U.S. $100,000. To the
extent the aggregate Fair Market Value of such Shares exceeds U.S. $100,000, the Options covering those Shares the Fair Market Value of which causes the aggregate Fair Market Value of all such Shares to be in excess of U.S. $100,000 shall be treated as Non−Statutory Stock Options. Incentive Stock Options shall be taken into account in the order in which they were granted, and the aggregate Fair Market Value of the Shares shall be determined as of the Date of the Grant.
(iii) Non-Statutory Stock Options granted to U.S. Beneficiaries may only be granted to Beneficiaries in respect of whom the Company is an "eligible issuer of service recipient stock" and the Shares are "service recipient stock", each within the meaning of Section 409A of the Code.
(b) The Options are governed by articles L. 225−177 and following of the French Commercial Code. They are not part of the employment agreement or of the office which has allowed the Optionee to be granted the Option. Neither do they constitute an element of the Optionee’s remuneration. Neither the Plan nor any Option shall confer upon an Optionee any right with respect to continuing the Optionee’s employment or his term of office with the Company or any Affiliated Company, nor shall they interfere in any way with the Optionee’s right or the Company’s or Affiliated Company’s right, as the case may be, to terminate such employment or such term of office at any time, with or without cause.
(c) Other than as expressly provided hereunder, no member of the Board or of the supervisory board (in the event of change of management formula of the Company) or of an equivalent management body of an Affiliated Company shall be as such eligible to receive Options under the Plan.
6. Term of Plan
Subject to the approval of the shareholders of the Company in accordance with Section 18 of the Plan, the Plan shall be effective and Options may be granted as of June 29, 2016 (the “Effective Date”). The Plan has been adopted by the Board on April 7, 2016, and amended from time to time. It shall continue in effect until the tenth (10th) anniversary of the Effective Date or until all Shares subject to the Plan have been purchased according to the provisions of the Plan, unless terminated earlier under Section 14 of the Plan. Notwithstanding the foregoing, Incentive Stock Options may not be granted under the Plan after April 7, 2026.
7. Term of Options
The term of each Option shall be stated in the Notice of Grant as nine years and six months from the Date of Grant, in accordance with the Shareholders Authorization, subject to the specific provisions applicable in the event of death or Disability during such nine year and six month period. Notwithstanding the foregoing, in the case of an Incentive Stock Option granted to a U.S. Beneficiary who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the voting rights of all classes of stock of the Company or any Parent or Subsidiary of the
Company and, to the extent such Beneficiary is permitted by the French Commercial Code to receive Option grants, the term of the Option shall be no more than five (5) years from the Date of Grant.
8. Option Exercise Price and Consideration
(a) Subscription or Purchase Price.
The per Share subscription or purchase price for the Shares to be issued or sold pursuant to exercise of an Option shall be determined by the Administrator on the basis of the Fair Market Value.
(i) In the case of an Incentive Stock Option granted to a U.S. Beneficiary who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the voting rights of all classes of stock of the Company or any Parent or Subsidiary of the Company and, to the extent such Beneficiary is permitted by the French Commercial Code to receive Option grants, the per Share subscription or purchase price shall be no less than one hundred ten percent (110%) of the Fair Market Value per Share on the Date of Grant as defined in Section 2(n)(ii);
(ii) In the case of a Non−Statutory Stock Option or Incentive Stock Option, not covered by Section 8(a)(i) above, granted to any U.S. Beneficiary, the per Share subscription or purchase price shall be no less than one hundred percent (100%) of the Fair Market Value per Share on the Date of Grant as defined in Section 2(n)(ii).
(b) Prohibition on Repricing.
Subject to limitations imposed by Section 409A of the Code, Applicable Laws and the French Commercial Code and except as provided in Sections 11 and 12 of the Plan, in no event shall the subscription or purchase price with respect to an Option be reduced following the Date of Grant of an Option, nor shall an Option be cancelled in exchange for a replacement Option with a lower exercise price or cash payment without shareholder approval.
(c) Vesting Period, Minimum Vesting Period and Exercise Dates.
(i) At the time an Option is granted, the Administrator shall fix the period within which the Option may be exercised and shall determine any conditions which must be satisfied before the Option may be exercised. In so doing, the Administrator may specify that an Option may not be exercised until the completion of a service period in the Company or an Affiliated Company. Any Option granted hereunder shall provide for a vesting period of at least one (1) year following the Date of Grant.
(ii) Notwithstanding anything set forth in Section 8(c)(i) to the contrary, Options representing a maximum of five percent (5%) of the Shares reserved for issuance under Section 3(a)(i) may be granted hereunder without any minimum vesting condition. Further, nothing in Section 8(c)(i) shall limit the Company’s ability to grant Options that contain rights to accelerated vesting on an Optionee’s termination of Continuous Status as a Beneficiary or to otherwise accelerate vesting, including, without limitation, upon a Change in Control.
(d) Form of Consideration.
The consideration to be paid for the Shares to be issued or purchased upon exercise of Options, including the method of payment, shall be determined by the Administrator. Unless otherwise provided in the Option Agreement, such consideration shall consist entirely of an amount in Euro or U.S. dollars corresponding to the exercise price which shall be paid by wire transfer. To the extent permitted by the Administrator, payment of consideration for the Shares (and/or any applicable tax withholdings) may be made by instructing the Company to withhold a number of Shares having a Fair Market Value equal to the product of (1) the subscription or exercise price per Share (plus tax withholdings, if applicable) multiplied by (2) the number of Shares in respect of which the Option shall have been exercised.
In the event that, as a consequence of the exercise of an Option, the Company or any Affiliated Company shall be compelled to pay taxes, social costs or any other social security taxes or contributions on behalf of the Optionee, the Option shall not be deemed duly exercised until the Optionee has paid to the Company or to the relevant Affiliated Company the amount corresponding to such taxes, social costs, or social security taxes or contributions.
Where the Company (or any Affiliated Company) is required, as a result of the exercise of an Option, to pay or account for any amount of U.K. tax or U.K. class 1 primary national insurance contributions, it shall be a condition of exercise of the relevant Option that the relevant Beneficiary shall, at the time of exercise, have remitted to the Company in cleared funds an amount equal to the liability to pay U.K. income tax or U.K. class 1 primary national insurance contributions or have entered into such other arrangements with the Company or the relevant Affiliated Company to discharge such liability as the Company may in its absolute discretion approve.
As a condition of grant of an Option hereunder, each Beneficiary agrees to pay to the Company or any Affiliated Company an amount equal to the Company or the Affiliated Company’s liability to pay class 1 secondary national insurance contributions arising on the exercise of an Option, and the Beneficiary shall be required to pay such amount on the exercise of the Option (failing which any purported exercise of the Option shall be invalid).
9. Exercise of Options
(a) Procedure for Exercise; Rights as a Shareholder.
Any Option granted hereunder shall be exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and set forth in the Option Agreement.
An Option may not be exercised for a fraction of a Share. Unless otherwise provided in an Option Agreement, the number of Shares in respect of which an Option can be exercised pursuant to an Option will always be rounded to the nearest whole number, provided however that the rounding does not result in the issuance of Shares pursuant to the exercise of an Option in an amount that exceeds the total number of Shares granted under the Option.
Subject to the provisions of Section 8(d) of the Plan, an Option shall be deemed exercised when the Company receives: (i) written notice of exercise (in accordance with the provisions of the Option Agreement) together with a share subscription or purchase form (bulletin de souscription ou d’achat) duly executed by the person entitled to exercise the Option, and (ii) full payment for the Shares with respect to which the Option is exercised in accordance with Section 8(d) of the Plan.
Upon exercise of an Option, the Shares issued or sold to the Optionee shall be assimilated with all other Shares of the Company of the same class and shall be entitled to dividends once the Shares are issued for the fiscal year during which the Option is exercised. For the avoidance of doubt, an Option shall not entitle an Optionee to receive any dividends paid prior to the date of exercise of such Option and in no event shall dividend equivalents be payable with respect to Options.
In the event that a Beneficiary infringes one of the above mentioned commitments, such Beneficiary shall be liable for any consequences resulting from such infringement for the Company and undertakes to indemnify the Company in respect of all amounts payable by the Company in connection with such infringement.
Granting of an Option in any manner shall result in a decrease in the number of Shares which thereafter may be available for purposes of the Plan, by the number of Shares as to which the Option may be exercised.
(b) Optionee’s Continuous Status as a Beneficiary in the event of an Agreed Leave of More Than Three Months.
Unless otherwise required by Applicable Laws, in the event an Optionee is on an Agreed Leave for more than three (3) months, such Optionee’s Options shall (a) stop vesting on the first day of the calendar quarter immediately following the calendar quarter during which the Agreed Leave began and (b) resume vesting on the first day of the calendar quarter immediately following the calendar quarter in which the Agreed Leave ends. As a result of any Agreed Leave, the vesting period for such Optionee’s Options shall be extended in accordance with this Section 9(b).
(c) Termination of the Optionee’s Continuous Status as Beneficiary.
Upon termination of an Optionee’s Continuous Status as a Beneficiary (including by reason of the Beneficiary's employer ceasing to be an Affiliated Company), other than upon the Optionee’s death or Disability, the Optionee may exercise his or her Options only within such period of time as is specified in the Notice of Grant and only for the part of the Options that the Optionee was entitled to exercise at the date of termination (but in no event later than the expiration of the term of such Options as set forth in the Notice of Grant). Unless a longer period is specified in the Notice of Grant or otherwise resolved by the Board, an Option shall remain exercisable for ninety (90) days following the Optionee’s termination of Continuous Status as a Beneficiary. In the case of an Incentive Stock Option, such a period cannot exceed three (3) months following the Optionee’s termination of Continuous Status as a Beneficiary (other than in the case of the Optionee’s death or disability as defined in Section 22(e)(3) of the Code) or the Option will be treated as a Non−Statutory Stock Option. If, at the date of termination, the Optionee is not entitled to exercise all his or her Options, the Shares covered by the unexercisable portion of Options shall revert to the Plan. If, after termination, the Optionee does not exercise all of his or her Options within the time specified by the Administrator, the Options shall terminate, and the Shares covered by such Options shall revert to the Plan.
(d) Disability of Optionee.
In the event that an Optionee’s Continuous Status as a Beneficiary terminates as a result of the Optionee’s Disability, unless otherwise resolved by the Board, the Optionee may exercise his or her Options at any time within six (6) months from the date of such termination, but only to the extent these Options are exercisable at the time of termination (but in no event later than the expiration of the term of such Options as set forth in the Notice of Grant). If, at the date of termination, the Optionee is not entitled
to exercise all of his or her Options, the Shares covered by the unexercised portion of Options shall revert to the Plan. If, after termination, the Optionee does not exercise all of his or her Options within the time specified herein or otherwise resolved by the Board, the Options shall terminate, and the Shares covered by such Options shall revert to the Plan.
(e) Death of Optionee.
In the event of the death of an Optionee during the term of the Options, unless otherwise resolved by the Board, the Options may be exercised at any time within six (6) months following the date of death, by the Optionee’s estate or by a person who acquired the right to exercise the Option by bequest or inheritance. If, after death, the Optionee’s estate or a person who acquired the right to exercise the Options by bequest or inheritance does not exercise the Options within the time specified herein, the Options shall terminate, and the Shares covered by such Options shall revert to the Plan.
10. Non-Transferability of Options
An Option may not be sold, pledged, assigned, hypothecated, transferred or disposed of in any manner other than by will or by laws of descent or distribution and may be exercised, during the lifetime of the Optionee, only by the Optionee.
11. Adjustments Upon Changes in Capitalization, Dissolution
(a) Changes in Capitalization.
(i) In the event of the carrying out by the Company of any of the financial operations pursuant to article L. 225−181 of the French Commercial Code as follows:
(1) amortization or reduction of the share capital,
(2) amendment of the allocation of profits,
(3) distribution of free shares,
(4) capitalization of reserves, profits, issuance premiums,
(5) the issuance of shares or securities giving right to shares to be subscribed for in cash or by set−off of existing indebtedness offered exclusively to the shareholders;
the Company shall take the required measures to protect the interest of the Optionees in the conditions set forth in article L. 228−99 of the French Commercial Code.
(ii) Without prejudice to Section 11(a)(i) or Section 12, in the event of any change in corporate capitalization, such as a stock split, or a corporate transaction, such as any merger, consolidation, separation, including a split-up, or other distribution of stock or property of the Company, any reorganization or any partial or complete liquidation of the Company, the Board shall make such adjustment in the number and class of Shares which may be delivered under Section 3, in the exercise or purchase price per share under any outstanding Option in order to
prevent dilution or enlargement of Beneficiaries' rights under the Plan, and in the Option limits set forth in Section 3 as it determines to be appropriate and equitable, in its sole discretion, to prevent dilution or enlargement of rights; provided, however, that the number of Shares subject to any Option shall always be a whole number; provided, further, that no such adjustment shall cause any Option hereunder which is or becomes subject to Section 409A of the Code to fail to comply with the requirements of such section.
(b) Dissolution or Liquidation.
In the event of the proposed dissolution or liquidation of the Company, to the extent that an Option has not been previously exercised, it will terminate immediately prior to the consummation of such proposed action. The Administrator may, in the exercise of its sole discretion in such instances, declare that any Option shall terminate as of a date determined by the Administrator and give each Optionee the right to exercise his or her Options as to Shares for which the Options would not otherwise be exercisable.
12. Change in Control
(a) Assumption or Substitution of Options.
(i) Unless otherwise provided by the Board, an agreement between the Company or an Affiliated Company and the Optionee or in the Notice of Grant, in the event of a Change in Control, each outstanding Option will be assumed or an equivalent option or right substituted by the successor corporation or a Parent or Subsidiary of the successor corporation. In the event that the successor corporation or Parent or Subsidiary of the successor corporation does not agree to assume or substitute for the outstanding Options, each Option that is not assumed or substituted for, will accelerate and become fully vested and exercisable prior to the consummation of the Change in Control at such time and on such conditions as the Administrator shall determine. In addition, if an Option becomes fully vested and exercisable in lieu of assumption or substitution in the event of a Change in Control, the Administrator will notify the relevant Optionee in writing or electronically that his or her Option will be fully vested and exercisable for a period of time, which shall not be less than 10 days, determined by the Administrator in its sole discretion, and the Option will terminate upon the expiration of such period.
(ii) For the purposes of this subsection, an Option will be considered assumed if, (A) following the Change in Control, the Option confers the right to purchase or receive, for each Share subject to the Option immediately prior to the Change in Control, the consideration (whether stock, cash, or other securities or property) or the Fair Market Value of the consideration received in the Change in Control by holders of Shares for each such Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the Change in Control is not solely common stock of the successor corporation or its Parent, the Administrator may, with the consent of the successor corporation, provide that the consideration
to be received upon the exercise of an Option for each Share subject to such Option to be solely common stock of the successor corporation or its Parent equal in Fair Market Value to the per share consideration received by holders of common stock of the Company in the Change in Control; (B) any securities of the successor corporation or its Parent forming part of the substitute Option following the Change in Control are freely tradeable on a major stock exchange; and (C) the Option otherwise remains subject to the same terms and conditions that were applicable to the Option immediately prior to the Change in Control.
(b) Cashout of Options.
Notwithstanding any provision of the Plan to the contrary, in the event that each outstanding Option is not assumed or substituted in connection with a Change in Control, the Administrator may, in its discretion, provide that each Option shall, immediately upon the occurrence of a Change in Control, be cancelled in exchange for a payment in cash or securities in an amount equal to (x) the excess (if any) of the consideration paid per Share in the Change in Control over the exercise or purchase price per Share subject to the Option multiplied by (y) the number of Shares granted under the Option. Without limiting the generality of the foregoing, in the event that the exercise or purchase price per Share subject to the Option is greater than or equal to the consideration paid per Share in the Change in Control, then the Administrator may, in its discretion, cancel such Option without any consideration upon the occurrence of a Change in Control.
(c) Plan Binding on Successors.
The obligations of the Company under this Plan shall be binding upon any successor corporation resulting from a Change in Control.
13. Grant
(a) The Date of Grant of an Option shall be, for all purposes, the date on which the Administrator decides to grant such Option. Notice of Grant shall be provided to each Optionee within a reasonable time after the Date of Grant.
(b) In the event of any tax liability arising on account of the grant of the Options or as a result of any other aspect of the Optionee’s participation in the Plan, the liability to pay such taxes shall be that of the Optionee alone.
The Optionee shall enter into such agreements of indemnity and execute any and all documents as the Company may specify for this purpose, if so required at the time of the Grant and at any other time at the discretion of the Company, on such terms and conditions as the Company may think fit, for recovery of the tax due, from the Optionee.
14. Amendment, Modification and Termination of the Plan
(a) Amendment and Termination.
Subject to Sections 14(b) and 14(c), the Administrator may at any time and from time to time, alter, amend, suspend or terminate the Plan in whole or in part.
(b) Shareholders’ approval.
The Company shall obtain shareholders’ approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws (including the requirements of any exchange or quotation system on which Shares may then be listed or quoted). Such shareholder approval, if required, shall be obtained in such a manner and to such a degree as is required by the Applicable Law.
(c) Effect of amendment or termination.
No amendment, alteration, suspension or termination of the Plan shall impair the rights of any Optionee, unless (i) mutually agreed otherwise between the Optionee and the Administrator, which agreement must be in writing and signed by the Optionee and the Company or (ii) necessary or appropriate to comply with or facilitate compliance with Applicable Laws or other rules, regulations or requirements, as determined by the Administrator.
15. Compliance with Company Policies
(a) Clawback Policy.
Options granted under the Plan, including any gain received upon exercise, shall be subject to any applicable clawback policy of the Company, as adopted by the Company from time to time, as well as to any clawback required by any Applicable Laws.
(b) Share Ownership Guidelines.
Any Shares acquired upon exercise of an Option may need to be retained by the Optionee in order to comply with the Company’s Share Ownership Guidelines, to the extent applicable to the Optionee.
16. U.S. Beneficiaries, Conditions Upon Issuance of Shares
(a) Legal Compliance.
Shares shall not be sold or issued pursuant to the exercise of an Option unless the exercise of such Option, and the issuance or sale and delivery of such Shares shall comply with all relevant provisions of law including, without limitation, the French Commercial Code, the Securities Act of 1933, as amended, the Exchange Act, the rules and regulations promulgated thereunder, Applicable Laws and the requirements of any stock exchange or quotation system upon which the Shares may then be listed or quoted.
(b) Investment Representations.
As a condition to the exercise of an Option by a U.S. Beneficiary, the Company may require the person exercising such Option to represent and warrant at the time of any such exercise that the Shares are being subscribed or purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required.
17. Liability of Company
(a) The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by any counsel to the Company to be necessary for the lawful issuance or sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.
(b) The Company and its Affiliated Companies may not be held responsible in any way if the Beneficiary for any reason not attributable to the Company or its Affiliated Companies was not able to exercise the Options or acquire the Shares.
18. Shareholder Approval
The Plan shall be subject to approval by the shareholders of the Company within twelve (12) months of the date the Plan is adopted by the Board. Such shareholder approval shall be obtained in the manner and to the degree required under the French Commercial Code and Applicable Laws.
19. Law, Jurisdiction
This Plan shall be governed by and construed in accordance with the laws of France.
The relevant courts in the location of the registered office of the Company shall be exclusively competent to determine any claim or dispute arising in connection herewith.
The grant of Options under this Plan shall entitle the Company to require the Optionee to comply with such requirements of law as may be necessary in the opinion of the Company from time to time.
Exhibit A
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CRITEO AMENDED 2016 STOCK OPTION PLAN
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SUB-PLAN FOR ISRAELI BENEFICIARIES
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1. GENERAL
1.1 This sub-plan (the “Sub-Plan”) shall apply only to Beneficiaries who are tax residents of the State of Israel on the date of the grant of the Option, as defined below in Section 2, and are engaged by an Israeli resident Affiliate (collectively, “Israeli Beneficiaries”). The provisions specified hereunder shall form an integral part of the Criteo Amended 2016 Stock Option Plan (hereinafter the “Plan”).
1.2 This Sub-Plan is adopted pursuant to the authority of the Committee under Section 4(b)(vii) of the Plan. This Sub-Plan is to be read as a continuation of the Plan and applies to Options granted to Israeli Beneficiaries only to the extent necessary to comply with the requirements set by Israeli law, and in particular, with the provisions of the Israeli Income Tax Ordinance [New Version] 1961, as may be amended or replaced from time to time. This Sub-Plan does not add to or modify the Plan in respect of any other category of Beneficiaries.
1.3 The Plan and this Sub-Plan are complimentary to each other and shall be deemed as one. In the event of any conflict, whether explicit or implied, between the provisions of this Sub-Plan and the Plan, the provisions set out in the Sub-Plan shall prevail to the extent necessary to comply with the requirements set by the Israeli law in general, and in particular, with the provisions of the Israeli Income Tax Ordinance [New Version] 1961, as may be amended or replaced from time to time.
1.4 Any capitalized term not specifically defined in this Sub-Plan shall be construed according to the interpretation given to it in the Plan.
2. DEFINITIONS
2.1 “102 Option” means any Option intended to qualify (as determined by the Committee and/or the Israeli Option Agreement) and which qualifies as an Option under Section 102, issued to an Approved Israeli Beneficiary.
2.2 “Applicable Law” shall mean any applicable law, rule, regulation, statute, pronouncement, policy, interpretation, judgment, order or decree of any federal, provincial, state or local governmental, regulatory or adjudicative authority or agency, of any jurisdiction, and the rules and regulations of any stock exchange, over-the-counter market or trading system on which the Shares are then traded or listed.
2.3 “Approved Israeli Beneficiary” means an Israeli Beneficiary who is an employee, director or an officer of an Employer, excluding any Controlling Share Holder of the Company.
2.4 “Option” means any Option granted under the Plan settled in Shares and which will not be capable of being settled in cash.
2.5 “Capital Gain Option” means a Trustee 102 Option elected and designated by the Company to qualify under the capital gain tax treatment in accordance with the provisions of Section 102(b)(2) and 102(b)(3) of the Ordinance.
2.6 “Controlling Share Holder” shall have the meaning ascribed to it in Section 32(9) of the Ordinance.
2.7 “Employer” means, for purpose of a Trustee 102 Option, an Israeli resident Affiliate of the Company which is an “employing company” within the meaning and subject to the conditions of Section 102(a) of the Ordinance.
2.8 “ITA” means the Israeli Tax Authority.
2.9 “Israeli Option Agreement” means the Option agreement between the Company and an Israeli Beneficiary that sets out the terms and conditions of an Option.
2.10 “Non-Trustee 102 Option” means a 102 Option granted pursuant to Section 102(c) of the Ordinance and not held in trust by a Trustee.
2.11 “Ordinary Income Option” means a Trustee 102 Option elected and designated by the Company to qualify under the ordinary income tax treatment in accordance with the provisions of Section 102(b)(1) of the Ordinance.
2.12 “Ordinance” means the Israeli Income Tax Ordinance [New Version] – 1961, as now in effect or as hereafter amended.
2.13 “Rules” means the Income Tax Rules (Tax Benefits in Stock Issuance to Employees) 5763-2003.
2.14 “Section 102” means Section 102 of the Ordinance and any regulations, rules, orders or procedures promulgated thereunder as now in effect or as hereafter amended.
2.15 “Tax” means any applicable tax and other compulsory payments, such as any social security and health tax contributions under any Applicable Law.
2.16 “Trust Agreement” means the agreement to be signed between the Company, an Employer and the Trustee for the purposes of Section 102.
2.17 “Trustee” means any person or entity appointed by the Company to serve as a trustee and approved by the ITA, all in accordance with the provisions of Section 102(a) of the Ordinance, as may be replaced from time to time.
2.18 “Trustee 102 Option” means a 102 Option granted to an Approved Israeli Beneficiary pursuant to Section 102(b) of the Ordinance and held in trust by a Trustee for the benefit of an Approved Israeli Beneficiary.
2.19 “Unapproved Israeli Beneficiary” means an Israeli Beneficiary who is not an Approved Israeli Beneficiary, including a Consultant or a Controlling Share Holder of the Company.
3. ISSUANCE OF OPTIONS
3.1 The persons eligible for participation in the Plan as Israeli Beneficiaries shall include Approved Israeli Beneficiaries and Unapproved Israeli Beneficiaries, provided, however, that only Approved Israeli Beneficiaries may be granted 102 Options.
3.2 The Committee may designate Options granted to Approved Israeli Beneficiaries pursuant to Section 102 as Trustee 102 Options or Non-Trustee 102 Options.
3.3 The grant of Trustee 102 Options shall be subject to this Sub-Plan and shall not become effective prior to the lapse of 30 days from the date the Plan has been submitted for approval by the ITA and shall be conditioned upon the approval of the Plan and this Sub-Plan by the ITA.
3.4 Trustee 102 Options may either be classified as Capital Gain Options or Ordinary Income Options.
3.5 No Trustee 102 Option may be granted under this Sub-Plan to any Approved Israeli Beneficiary, unless and until the Company has filed with the ITA its election regarding the type of Trustee 102 Options, whether Capital Gain Options or Ordinary Income Options, that will be granted under the Plan and this Sub-Plan (the “Election”). Such Election shall become effective beginning the first date of grant of a Trustee 102 Option under this Sub-Plan and shall remain in effect at least until the end of the year following the year during which the Company first granted Trustee 102 Options. The Election shall obligate the Company to grant only the type of Trustee 102 Option it has elected, and shall apply to all Israeli Beneficiaries who are granted Trustee 102 Options during the period indicated herein, all in accordance with the provisions of Section 102(g) of the Ordinance. For the avoidance of doubt, the Election shall not prevent the Company from granting Non-Trustee 102 Options simultaneously.
3.6 All Trustee 102 Options must be held in trust by, or subject to the approval of the ITA, under the control or supervision of a Trustee, as described in Section 5 below.
3.7 The designation of Non-Trustee 102 Options and Trustee 102 Options shall be subject to the terms and conditions set forth in Section 102.
3.8 Options granted to Unapproved Israeli Beneficiaries shall be subject to tax according to the provisions of the Ordinance and shall not be subject to the Trustee arrangement detailed herein.
4. 102 OPTION GRANT DATE
Each 102 Option will be deemed granted on the date determined by the Committee, subject to the provisions of the Plan, provided that and subject to (i) the Israeli Beneficiary has signed all documents required by the Company or Applicable Law, and (ii) with respect to any Trustee 102 Option, the Company has provided all applicable documents to the Trustee in accordance with the guidelines published by the ITA such that if the guidelines are not met the Option will be considered as granted on the date determined by the Committee as a Non-Trustee Option.
5. TRUSTEE
5.1 Trustee 102 Options which shall be granted under this Sub-Plan and/or any Shares allocated or issued upon the grant, exercise of a Trustee 102 Option and/or other Shares received following any realization of rights under the Plan, shall be allocated or issued to the Trustee or controlled by the Trustee, for the benefit of the Approved Israeli Beneficiaries, in accordance with the provisions of Section 102. In the event the requirements for Trustee 102 Options are not met, the Trustee 102 Options may be regarded as Non-Trustee 102 Options or as Options which are not subject to Section 102, all in accordance with the provisions of Section 102.
5.2 With respect to any Trustee 102 Option, subject to the provisions of Section 102, an Approved Israeli Beneficiary shall not sell or release from trust any Shares received upon the grant or exercise of a Trustee 102 Option and/or any Shares received following any realization of rights, including, without limitation, stock dividends, under the Plan at least until the lapse of the period of time required under Section 102 or any shorter period of time determined by the ITA (the “Holding Period”). Notwithstanding the foregoing, if any such sale or release occurs during the Holding Period, the sanctions under Section 102 shall apply to and shall be borne by such Approved Israeli Beneficiary.
5.3 Notwithstanding anything to the contrary, the Trustee shall not release or sell any Shares allocated or issued upon the grant or exercise of a Trustee 102 Option unless the Company, its Israeli Affiliate and the Trustee are satisfied that the full amounts of any Tax due have been paid or will be paid.
5.4 Upon receipt of any Trustee 102 Option, the Approved Israeli Beneficiary will consent to the grant of such Option under Section 102 and undertake to comply with the terms of Section 102 and the trust arrangement between the Company and the Trustee.
6. THE OPTIONS
The terms and conditions upon which Options shall be granted, issued and exercised or vested under this Sub-Plan, shall be specified in an Israeli Option Agreement to be executed pursuant to the Plan and to this Sub-Plan. Each Israeli Option Agreement shall provide, inter alia, the number of Shares to which the Option relates, the type of Option granted thereunder (i.e., a Capital Gain Options or Ordinary Income Options or Non-Trustee 102 Option or any Option granted to Unapproved Israeli Beneficiary), and any applicable vesting provisions and exercise price that may be payable. For the avoidance of doubt, it is clarified that there is no obligation for uniformity of treatment of Israeli Beneficiaries and that the terms and conditions of Options granted to Israeli Beneficiaries need not be the same with respect to each Israeli Beneficiary (whether or not such Israeli Beneficiaries are similarly situated). The grant, vesting and exercise of Options granted to Israeli Beneficiaries shall be subject to the terms and conditions and, with respect to exercise, the method, as may be determined by the Committee (including the provisions of the Plan) and, when applicable, by the Trustee, in accordance with the requirements of Section 102.
7. ASSIGNABILITY, DESIGNATION AND SALE OF OPTIONS
7.1. Notwithstanding any provision of the Plan, no Option subject to this Sub-Plan or any right with respect thereto, whether fully paid or not, shall be assignable, transferable or given as collateral, and no right with respect to any such Option shall be given to any third party whatsoever, and during the lifetime of the Israeli Beneficiary, each and all of such Israeli Beneficiary’s rights with respect to an Option shall belong only to the Israeli Beneficiary. Any such action made, directly or indirectly, for an immediate or future validation, shall be void.
7.2 As long as Options and/or Shares issued or purchased hereunder are held by the Trustee on behalf of the Israeli Beneficiary, all rights of the Israeli Beneficiary over the Option and Shares cannot be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution.
8. INTEGRATION OF SECTION 102 AND TAX ASSESSING OFFICER’S APPROVAL
8.1. With regard to Trustee 102 Options, the provisions of the Plan, the Sub-Plan and/or the Israeli Option Agreement shall be subject to the provisions of Section 102 and any approval issued by the ITA and the said provisions shall be deemed an integral part of the Plan, the Sub-Plan and the Israeli Option Agreement.
8.2. Any provision of Section 102 and/or said approval issued by the ITA, which must be complied with in order to receive and/or to maintain any tax treatment with respect to an Option pursuant to Section 102, which is not expressly specified in the Plan, the Sub-Plan or the Israeli Option Agreement, shall be considered binding upon the Company, any Israeli Affiliate and the Israeli Beneficiaries. Furthermore, if any provision of the Plan or Sub-Plan disqualifies Options that are intended to qualify as 102 Options from the beneficial tax treatment pursuant to Section 102, such provision shall not apply to the 102 Options.
9. TAX CONSEQUENCES
9.1 Any tax consequences arising from the grant, purchase, exercise or sale of any Option issued hereunder, from the payment for or sale of Shares covered thereby or from any other event or act (of the Company, and/or its Affiliates, and the Trustee or the Israeli Beneficiary), hereunder, shall be borne solely by the Israeli Beneficiary. The Company and/or its Affiliates, and/or the Trustee shall withhold Tax according to the requirements of Applicable Laws, rules, and regulations, including withholding taxes at source. Furthermore, the Israeli Beneficiary agrees to indemnify the Company and/or its Affiliates and/or the Trustee and hold them harmless against and from any and all liability for any such Tax or interest or
penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such Tax from any payment made to the Israeli Beneficiary.
9.2 The Company and/or, when applicable, the Trustee shall not be required to release any Option or Shares to an Israeli Beneficiary until all required Tax payments have been fully made.
9.3 Options that do not comply with the requirements of Section 102 shall be subject to tax under Section 3(i) or 2 of the Ordinance.
9.4 With respect to Non-Trustee 102 Options, if the Israeli Beneficiary ceases to be employed by the Company or any Affiliate, or otherwise if so requested by the Company and/or its Affiliates, the Israeli Beneficiary shall extend to the Company and/or its Affiliates a security or guarantee for the payment of Tax due at the time of the sale of Shares, in accordance with the provisions of Section 102.
10. TERM OF PLAN AND SUB-PLAN
Notwithstanding anything to the contrary in the Plan and in addition thereto, the Company shall obtain all approvals for the adoption of this Sub-Plan or for any amendment to this Sub-Plan as are necessary to comply with any Applicable Law, applicable to Options granted to Israeli Beneficiaries under this Sub-Plan or with the Company's incorporation documents.
12. GOVERNING LAW
Solely for the purpose of determining the Israeli tax treatment of Options granted pursuant to this Sub-Plan, this Sub-Plan shall be governed by, construed and enforced in accordance with the laws of the State of Israel, without reference to conflicts of law principles.
* * * * *
Exhibit B
CRITEO
STOCK OPTION GRANT AGREEMENT
Part I
NOTICE OF STOCK OPTION GRANT
[Optionee’s Name and Address]
You have been granted an Option to subscribe ordinary Shares of the Company, subject to the terms and conditions of the 2016 Stock Option Plan (the “Plan”) and this Option Agreement. The Option is governed by articles L. 225−177 and following of the French Commercial Code. The Option is not part of the employment agreement or of the office which has allowed the Optionee to be granted the Option. Neither does it constitute an element of the Optionee’s remuneration. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Stock Option Grant Agreement.
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Date of Grant:
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________________________________
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Vesting Commencement Date:
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________________________________
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Exercise Price per Share:
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[EUR] ___________________________
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Total Number of Shares Granted:
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________________________________
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[Type of Options:
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[Incentive Stock Option]
[Nonstatutory Stock Option] ]
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Term/Expiration Date
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________________________________
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Where the exercise of an Option, as described under Section 9(a) of the Plan, would lead the Company to be liable for any payment, whether due to fees, taxes or to charges of any nature whatsoever, in place of the Optionee, such Option shall be deemed duly exercised when the full payment for the Shares with respect to which the Option is exercised is executed by the Optionee and the Optionee provides the Company with either the receipt stating the payment by the Optionee of any such fee, tax or charge, as above described that would otherwise be paid by the Company upon exercise of the Option, in place of the Optionee or, the full payment, under the same conditions, of any amount due upon the exercise of the Option to be borne by the Company.
In the event that you infringe the above mentioned commitment, you shall be liable for any consequences resulting from such infringement for the Company and undertake to indemnify the Company in respect of all amounts payable by the Company in connection with such infringement.
Validity of the Options:
The Option will be valid as from the Date of Grant.
Vesting Schedule:
Unless otherwise determined or amended by the Board, the Option may be exercised by the Optionee on the basis of the following initial vesting schedule subject to the condition precedent that the Optionee shall have previously returned to the Company the documents referred to under section 1.3 of Part II of the Stock Option Grant Agreement duly initialed and signed:
•1/4th (25%) of the Option as from the first anniversary of the Vesting Commencement Date,
•then, 1/16th (6.25%) of the Option at the expiration of each quarter (i.e., successive 3-month period) following the first anniversary of the Vesting Commencement Date during thirty-six (36) months thereafter, and
•at the latest within nine years and six month as from the Date of Grant or in case of death or Disability of the Optionee during such nine years and six months period, six (6) months as from the death or Disability of the Optionee.
The number of Shares in respect of which the Option can be exercised pursuant to the above vesting schedule will always be rounded to the nearest whole number, provided however that the rounding does not result in the issuance of Shares pursuant to the exercise of an Option in an amount that exceeds the total number of Shares granted under the Option.
If the Optionee fails to exercise the Option in whole or in part within the said period of nine years and six months (as may be extended to six (6) months from the death or Disability of the Optionee), the Option will lapse automatically.
Termination Period:
Unless otherwise decided by the Board, in case of termination of the Optionee’s Continuous Status as a Beneficiary, the portion of the Option exercisable at the time of termination may be exercised for ninety (90) days after such termination, it being specified that the other portion of the Option shall automatically expire at the time of termination.
Upon the death or Disability of the Optionee, the Option may be exercised during a period of six (6) months as provided in the Plan.
Save as may be provided in the Plan, in no event shall the Option be exercised later than the Term/Expiration Date as provided above. Should the Option expire or become unexercisable for any reason without having been exercised in full, the unsubscribed Shares which were subject thereto shall, unless the Plan shall have been terminated, become available for future grant under the Plan.
By his or her signature and the signature of the Company’s representative below, the Optionee and the Company agree that the Option is granted under and governed by the terms and conditions of the Plan and this Stock Option Grant Agreement. The Optionee has reviewed the Plan and this Stock Option Grant Agreement in their entirety, has had the opportunity to obtain the advice of counsel prior to executing this Stock Option Grant Agreement and fully understands all provisions of the Plan and Stock Option Grant Agreement. The Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to the Plan and Stock Option Grant Agreement. The Optionee further agrees to notify the Company upon any change in the residence address indicated below.
CRITEO
STOCK OPTION GRANT AGREEMENT
Part II
TERMS AND CONDITIONS
1. Grant of Options.
1.1 The Administrator of the Company hereby grants to the Optionee named in the Notice of Grant attached as Part I of this Stock Option Grant Agreement (the “Optionee”), an option (the “Option”) to subscribe for the number of ordinary Shares, as set forth in the Notice of Grant, at the exercise price per Share set forth in the Notice of Grant (the “Exercise Price”), subject to the terms and conditions of the Plan, which is incorporated herein by reference.
In the event of a conflict between the terms and conditions of the Plan and the terms and conditions of this Stock Option Grant Agreement, the terms and conditions of the Plan shall prevail.
[If designated in the Notice of Grant as an Incentive Stock Option, this Option is intended to qualify as an Incentive Stock Option under Section 422 of the Code although the Company makes no representation as to the tax status of the Option. However, if this Option is intended to be an Incentive Stock Option, to the extent that it exceeds the U.S.$100,000 rule of Section 422(d) of the Code, the excess shall be treated as a Non−Statutory Stock Option.]
1.2 An Option will be valid as from the Date of Grant.
1.3 In the event of any tax liability arising on account of the grant of the Options or as a result of any other aspect of the Optionee’s participation in the Plan, the liability to pay such taxes shall be that of the Beneficiary alone. The Beneficiary shall enter into such agreements of indemnity and execute any and all documents as the Company may specify for this purpose, if so required at the time of the Grant and at any other time at the discretion of the Company, on such terms and conditions as the Company may think fit, for recovery of the tax due, from the Beneficiary.
2. Exercise of Options.
(a) Right to Exercise. An Option is exercisable during its term in accordance with the Vesting Schedule set out in the Notice of Grant and the applicable provisions of the Plan and this Stock Option Grant Agreement, subject to the condition precedent that the Optionee shall have previously returned to the Company, by electronic delivery under the conditions set forth in Section 10 below:
•Part I and Part II of the Stock Option Grant Agreement (Exhibit A), duly initialed (all pages but for the signature page) and signed (signature page).
In the event of Optionee’s death, Disability or other termination of Optionee’s Continuous Status as a Beneficiary, the exercisability of an Option is governed by the applicable provisions of the Plan and this Stock Option Grant Agreement.
(b) Method of Exercise. An Option is exercisable by delivery of an exercise notice, in the form available via the dedicated online platform (the “Exercise Notice”) stating the election to exercise the Option, the number of Shares in respect of which the Option is being exercised (the “Exercised Shares”), and such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be signed by the Optionee and shall be delivered in person or by certified mail to the Company or its designated representative or by facsimile message to be immediately confirmed by certified mail to the Company or in such other manner as the Company may permit. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Exercised Shares. An Option shall be deemed to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by the proof of payment of such aggregate Exercise Price.
No Share shall be issued pursuant to the exercise of an Option unless such issuance and exercise complies with all relevant provisions of law as set out under Section 16(a) of the Plan.
Upon exercise of an Option, the Shares issued to the Optionee shall be assimilated with all other Shares of the Company, and as from the date of exercise of the Option, the Optionee shall be entitled to dividends for the fiscal year during which the Option is exercised to the same extent as any other shareholder of the Company.
3. Method of Payment. Payment of the aggregate Exercise Price shall be made via the Company’s dedicated online platform.
Where the exercise of an Option would lead the Company or any Affiliated Company to be liable for any payment, whether due to fees, taxes or to charges of any nature whatsoever, in place of the Optionee, such Option shall be deemed duly exercised when (a) the full payment for the Shares with respect to which the Option is exercised is executed by the Optionee and (b) the Optionee provides the Company with either (i) the receipt stating the payment by the Optionee of any such fee, tax or charge, as above described that would otherwise be paid by the Company upon exercise of the Option or, (ii) the full payment, under the same conditions, of any amount due upon the exercise of the Option to be borne by the Company.
The Company and its Affiliated Companies may not be held responsible in any way if the Beneficiary for any reason not attributable to the Company or its Affiliated Companies was not able to exercise the Option or purchase the Shares. The payment for the purchase of the Shares is the sole responsibility of the Optionee according to these Terms and Conditions.
4. Non-Transferability of Option. An Option may not be transferred in any manner otherwise than by will or by the laws of descent or distribution and may be exercised during the lifetime of the Optionee only by the Optionee. The terms of the Plan and this Stock Option Grant Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee.
5. Term of Options. Except as provided in the Plan, an Option may be exercised only within the term set out in the Notice of Grant, and may be exercised during such term only in accordance with the Plan and the terms of this Stock Option Grant Agreement.
6. Entire Agreement; Governing Law. The Plan is incorporated herein by reference. The Plan and this Stock Option Grant Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. This agreement is governed by the laws of the Republic of France.
Any claim or dispute arising under the Plan or this Agreement shall be subject to the exclusive jurisdiction of the court of competent jurisdiction in the place of the registered office of the Company.
7. Tax Obligations. Regardless of any action the Company or Optionee’s employer (the “Employer”) takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax-Related Items”), Optionee acknowledges that the ultimate liability for all Tax-Related Items legally due by Optionee is and remains Optionee’s responsibility and that the Company and/or the Employer (1) make no representations or undertakings regarding the treatment of any Tax−Related Items in connection with any aspect of the Option grant, including the grant, vesting or exercise of the Option, the subsequent sale of shares of common stock acquired pursuant to such exercise and the receipt of any dividends; and (2) do not commit to structure the terms of the grant or any aspect of the Option to reduce or eliminate Optionee’s liability for Tax−Related Items.
Prior to exercise of the Option, Optionee will pay or make adequate arrangements satisfactory to the Company and/or the Employer to satisfy all withholding obligations of the Company and/or the Employer, if any. In this regard, Optionee authorizes the Company and/or the Employer to withhold all applicable Tax−Related Items legally payable by Optionee from Optionee’s compensation paid to Optionee by the Company and/or Employer or from proceeds of the sale of Shares. Alternatively, or in addition, if permissible under local law, the Company may sell or arrange for the sale of Shares that Optionee acquires to meet the withholding obligation for Tax-Related Items. Finally, Optionee will pay to the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold as a result of Optionee’s participation in the Plan or Optionee’s purchase of Shares that cannot be satisfied by the means previously described. The Company may refuse to honor the exercise and refuse to deliver the Shares issuable upon exercise of the Options if Optionee fails to comply with Optionee’s obligations in connection with the Tax−Related Items as described in this section.
8. Nature of Grant. In accepting the grant, Optionee acknowledges that:
(a) the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Stock Option Grant Agreement;
(b) the grant of the Option is voluntary and occasional and does not create any contractual or other right to receive future grants of options, or benefits in lieu of options, even if options have been granted repeatedly in the past;
(c) all decisions with respect to future option grants, if any, will be at the sole discretion of the Company;
(d) Optionee’s participation in the Plan shall not create a right to further employment with the Company, any Affiliated Company or the Employer and shall not interfere with the ability of the Company, any Affiliated Company or the Employer to terminate Optionee’s employment relationship at any time with or without cause;
(e) Optionee is voluntarily participating in the Plan;
(f) the Option is an extraordinary item that does not constitute compensation of any kind for services of any kind rendered to the Company, an Affiliated Company or the Employer, and which is outside the scope of Optionee’s employment contract, if any;
(g) the Option is not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long service awards, pension or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company, an Affiliated Company or the Employer;
(h) the Option grant will not be interpreted to form an employment contract with the Company, the Employer or any Subsidiary or affiliate of the Company;
(i) the future value of the underlying Shares is unknown and cannot be predicted with certainty;
(j) if the underlying Shares do not increase in value, the Option will have no value;
(k) if Optionee exercises Optionee’s Option and obtains Shares, the value of those Shares acquired upon exercise may increase or decrease in value, even below the exercise price;
(l) in consideration of the grant of the Option, no claim or entitlement to compensation or damages shall arise from termination of the Option or diminution in value of the Option or Shares purchased through exercise of the Option resulting from termination of Optionee’s employment the Company or the Employer (for any reason whatsoever) and Optionee irrevocably releases the Company and the Employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, Optionee shall be deemed irrevocably to have waived Optionee’s entitlement to pursue such claim; and
(m) in the event of termination of Optionee’s employment, Optionee’s right to receive the Option and vest in the Option under the Plan, if any, will terminate effective as of the date that Optionee receives notice of termination regardless of when such termination is effective; furthermore, in the event of termination of employment, Optionee’s right to exercise the Option after termination of employment, if any, will be measured by the date on which the Optionee receives notice of termination; the Company shall have the exclusive discretion to determine when Optionee is no longer actively employed for purposes of Optionee’s Option grant. In addition, any period of notice or compensation in lieu of such notice, that is given or ought to have been given under any contract, statute, common law or civil law shall be excluded.
9. [To be included for the employees of the Israeli subsidiary: Israeli Participants: The Options are intended to be subject to tax pursuant to the trustee capital gains route of Section 102 of the Ordinance, subject to compliance with the requirements under Section 102 and any rules or regulations thereunder, including the execution of this Notice of Stock Option Grant and the required declarations. However, in the event the Options do not meet the requirements of Section 102, such Options and the underlying Ordinary Shares shall not qualify for the favorable tax treatment under the Capital Gains Route. The Company makes no representations or guarantees that the Options will qualify for favorable tax treatment and will not be liable or responsible if favorable tax treatment is not available under Section 102. The Options and the Ordinary Shares issued upon exercise and/or any additional rights, as detailed above, including without limitation any right to receive any dividends or any shares received as a result of an adjustment made under the Plan, that may be granted in connection with the Options (the “Additional Rights”) shall be issued to or controlled by the Trustee for your benefit under the provisions of the Capital Gains Route for at least the period stated in Section 102 or any other period of time determined by the Israel Tax Authority (“ITA”). In accordance with the requirements of Section 102 and the Capital Gains
Route, you shall not sell nor transfer from the Trustee the Ordinary Shares or Additional Rights until the end of the Holding Period. Notwithstanding the above, if any such sale or transfer occurs before the end of the Holding Period, the sanctions under Section 102 shall apply and shall be borne by you. The Company and/or member of the Group and/or the Trustee shall withhold taxes according to the requirements under the applicable laws, the rules, and regulations, including withholding taxes at source. Furthermore, you hereby agree to indemnify the Company and/or any member of the Group and/or the Trustee and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to you. The Company and/or any member of the Group and/or the Trustee, to the extent permitted by law, shall have the right to deduct from any payment otherwise due to you, or from proceeds of the sale of any Ordinary Shares, an amount equal to any tax required by law to be withheld with respect to such Ordinary Shares. You will pay to the Company, any member of the Group or the Trustee any amount of taxes that the Company and/or any member of the Group or the Trustee may be required to withhold with respect to any Ordinary Shares that cannot be satisfied by the means previously described. The Company may refuse to deliver any Ordinary Shares if you fail to comply with your obligations in connection with the taxes as described in this section. Any fees associated with any exercise, sale, transfer or any act in relation to the Options and the Ordinary Shares issued upon exercise, shall be borne by you. The Trustee and/or the Company and/or any member of the Group shall be entitled to withhold or deduct such fees from payments otherwise due to/from the Company or any member of the Group or the Trustee.
[Security Law Exemption. If required, the Company will obtain an exemption from the requirement to file a prospectus with respect to the Options. If obtained copies of the Plan and Form S-8 registration statement for the Plan filed with the U.S. Securities and Exchange Commission will be available free of charge upon request from your local human resources department.]
In addition to the acknowledgments noted above and in the Plan, you hereby understand, acknowledge, agree as follows: (i) you are familiar with the provisions of Section 102 of the Ordinance and the regulations and rules promulgated thereunder, including without limitations the provisions of the tax route applicable to your Options and agree to comply with such provisions, as amended from time to time, provided that if such terms are not met, the specific tax route may not apply; (ii) you accept the provisions of the trust agreement signed between the Company and the Trustee, and agree to be bound by its terms; (iii) you acknowledge that selling the Ordinary Shares or releasing the Ordinary Shares from the control of the Trustee prior to the termination of the Holding Period constitutes a violation of the terms of Section 102 and agree to bear the relevant sanctions; (iv) you authorize the Company to provide the plan administrator and the Trustee with any information required for the purpose of administering the Plan including executing their obligations according to Section 102 of the Ordinance, the trust deed and the trust agreement, including without limitation information about your Options, Ordinary Shares, income tax rates, salary bank account, contact details and identification number and acknowledge that the information might be shared with an administrator who is located outside of Israel, where the level of protection of personal data is different than in Israel.]
10. Data Privacy. As part of the 2016 Stock option Plan, the Company processes some personal data of the Beneficiary. For this processing, the Company acts as the controller of this personal data and in accordance with the provisions of Regulation (EU) 2016/679 and, where applicable, those of Act No. 78-17 known as "Information technology & Civil Liberties", as amended, together the "Personal Data Regulation". Undefined terms used in this clause have the meaning given to them pursuant to the Personal Data Regulation.
The Company processes the Beneficiary's personal data on the legal basis of the conclusion and performance of the Stock Option Grant Agreement. The purpose of the contract is to implement, administer and manage the Beneficiary's participation in the Plan. Processed personal data are those strictly necessary for the aforementioned purposes. Especially, this includes the following information: the Beneficiary's name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares or directorships held in the Company, details of all awards or any other entitlement Shares awarded, cancelled, exercised, vested, unvested or outstanding in Beneficiary's favor (the "Data"). Failure by the Beneficiary to provide certain Data could compromise the conclusion and performance of the Stock Option Grant Agreement.
The Company may disclose the Data to the Employer, subsidiaries and Affiliated Companies, sub-contractors, banking and financial organizations, on a need-to-know basis. These entities may be located outside the European Union and in countries that have not been subject of an adequacy decision. If the recipients are located in other countries that do not provide an adequate level of protection for personal data, the Company will take all necessary measures and guarantees to ensure such a level and to supervise such transfers of Data in accordance with the Personal Data Regulation, in particular by implementing standard contractual clauses of the European Commission. The Beneficiary may request a copy of these guarantees by writing to the Data Protection Officer at the following address: dpo@criteo.com.
In accordance with the Personal Data Regulation, where applicable, the Beneficiary has the right to access, rectify, delete, limit processing and transfer his Data. To exercise these rights, the Beneficiary may contact the Data Protection Officer at dpo@criteo.com. The Beneficiary also has the right to file a complaint with the competent supervisory authority and to communicate to the Company instructions for the storage, deletion and communication of its Data after its death.
In the context of this processing, the Data will not be kept for longer than necessary for the purposes referred to in this clause. In any event, the Company will comply with the retention periods imposed by law.
11. Electronic Delivery. The Company may, in its sole discretion, decide to deliver any documents related to the Option and participation in the Plan or future options that may be granted under the Plan by electronic means or to request Optionee’s acceptance to participate in the Plan by electronic means. Optionee hereby consents to receive such documents by electronic delivery and, if requested, to agree to participate in the Plan through an on−line or electronic system established and maintained by the Company or another third party designated by the Company.
12. Severability. The provisions of this Stock Option Grant Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
SIGNATURE PAGE
OPTIONEE: CRITEO
By:
Signature
Title:
Print Name
Residence Address
APPENDIX B
Please note that because we are a French company, the full text of the plan has been translated from French. In the case of any discrepancy between this version and the French version, the French version will prevail.
CRITEO
AMENDED AND RESTATED 2015 TIME-BASED RESTRICTED STOCK UNITS PLAN
Adopted by the Board of Directors on April 23, 2020
Approved by the Company's combined shareholders' general meetings of October 23, 2015, June 29, 2016 and June 28, 2017
Amended from time to time. Last amendment by the Board: April 7, 2021
TABLE OF CONTENTS
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1.
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IMPLEMENTATION OF THE TIME-BASED RESTRICTED STOCK
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2
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2.
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DEFINITIONS
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2
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3.
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PURPOSE
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4
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4.
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BENEFICIARIES: ELIGIBLE EMPLOYEES
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4
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5.
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NOTICE OF THE GRANT OF THE RESTRICTED STOCK UNITS
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5
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6.
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VESTING PERIOD
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5
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7.
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HOLDING PERIOD
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8
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8.
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CHARACTERISTICS OF THE ORDINARY SHARES
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8
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9.
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DELIVERY AND HOLDING OF THE RESTRICTED STOCK UNIT
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9
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10.
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SHARES SUBJECT TO PLAN; INDIVIDUAL LIMITATIONS
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9
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11.
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INTERMEDIARY OPERATIONS
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10
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12.
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ADJUSTMENT
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10
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13.
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AMENDMENT OF THE TIME-BASED PLAN
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10
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14.
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TAX AND SOCIAL RULES
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11
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15.
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MISCELLANEOUS
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11
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16.
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DATA PRIVACY
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12
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17.
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ELECTRONIC DELIVERY
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13
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18.
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SEVERABILITY
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13
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1. Implementation of the Time-Based Restricted Stock Units Plan
On July 30, 2015, the Board of Directors adopted the Original 2015 Time-Based Restricted Stock Units Plan, stating the conditions and criteria for the Grant of Restricted Stock units of Criteo, a French société anonyme whose registered office is located at 32, rue Blanche, 75009 Paris, France, and whose identification number is 484 786 249 R.C.S. Paris (hereafter referred to as the "Company”), to the benefit of employees, certain categories of such employees, and/or corporate officers who meet the conditions set forth by Article L. 225-197-1 II of the French Commercial Code of the Company or any company or economic interest group in which the Company holds, directly or indirectly, 10% or more of the share capital and voting rights at the date of Grant of said shares. The Original 2015 Time-Based Restricted Stock Units Plan was subsequently approved by the combined (ordinary and extraordinary) shareholders’ meeting of the Company which also granted authority to the Board of Directors to grant Restricted Stock Units under the Original 2015 Time-Based Restricted Stock Units Plan. On February 25, 2016 the Board of Directors adopted this amended and restated version of the Original 2015 Time-Based Restricted Stock Units Plan (hereinafter, and as it may be amended from time to time in accordance with the provisions hereof, and in particular by the Board of Directors on April 7, 2016, on June 28, 2016, on July 28, 2016, on June 27, 2017, on April 4, 2018, on April 25, 2019, on April 23, 2020 and on April 7, 2021 ,the "2015 Time-Based Restricted Stock Units Plan” or the "Time-Based Plan”).
2. Definitions
Under the Time-Based Plan, the following terms and expressions starting with a capital letter shall have the following meaning and may be used indifferently in the singular or in the plural form:
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"Agreed Leave"
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refers to any leave of absence of more than three months having received a prior approval from the Company or requiring no prior approval under U.S. laws. Agreed Leaves shall include leaves for illnesses, military leave, and any other personal leave or conditions about which the employee has advance knowledge. Agreed Leave shall not include any absence considered as effective working time, such as maternity leave, of whatever duration, which shall not automatically result in a termination of the employment relationship between the Beneficiary and the Company or the Group.
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"Beneficiary"
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refers to the person(s) for whose benefit the Board of Directors has approved a Grant of Restricted Stock Units as well as, as the case may be, his or her heirs;
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"Board of Directors"
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refers to the Company’ s board of directors;
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"Bylaws"
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refers to the Company’s bylaws in force at the date referred to;
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"Change in Control"
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refers to (i) a merger (fusion) of the Company with or into another corporation, other than to another corporation, entity or person in which the holders of at least a majority of the voting rights and share capital of the Company outstanding immediately prior to such transaction continue to hold (either by such shares remaining outstanding in the continuing entity or by being converted into shares of voting rights and share capital of the surviving entity) a majority of the total voting rights and share capital of the Company (or the surviving entity) outstanding immediately after such transaction (an "Excluded Entity”), or (ii) the sale (vente) or other form of transfer by one or several shareholders of the Company to any person or group of persons of a number of Ordinary Shares of the Company such that the transferee(s) shall own a majority of the voting rights and share capital of the Company, or (iii) the sale, lease or other disposition, in a single transaction or in a series of related transactions, of all or substantially all of the assets of the Company other than to (1) a corporation or other entity of which at least a majority of its combined voting rights and share capital is owned directly or indirectly by the Company or (2) an Excluded Entity.
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"Disability"
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refers to the disability of a Beneficiary corresponding to the second or third of the categories provided by Article L. 341-4 of the French Social Security Code;
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"Grant Date"
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refers to the date when the Board of Directors approves a grant of Restricted Stock Units under the Time-Based Plan;
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"Grant Letter"
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refers to the notice, substantially in the form set forth in Exhibit 2, which informs a given Beneficiary of the Grant of Restricted Stock Units, as stated in Article 5 of the Time-Based Plan;
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"Grant"
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refers to the decision of the Board of Directors to grant Restricted Stock Units to a given Beneficiary, subject to the vesting conditions set forth by the Time-Based Plan as amended from time to time;
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"Group"
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refers to the Company and to all the companies and groups affiliated to the Company within in the meaning of Article L. 225-197-2 of the French Commercial Code;
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"Holding Period"
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refers to the period, if any, starting on the Vesting Date, during which a Beneficiary may not transfer or pledge his or her shares underlying the vested Restricted Stock Units, by any means, or convert them into the bearer form; it being specified that the total duration of both the Vesting Period and the Holding Period may in no event be less than two years as from the Grant Date pursuant to applicable French law;
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"Ordinary Share"
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refers to one ordinary share (action ordinaire) of the Company or an American Depositary Share representing one Share on the Nasdaq Global Market.
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"Original Time-Based Plan"
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refers to the version of the Time-Based Plan that was adopted by the Board of Directors on July 30, 2015 and approved by the combined (ordinary and extraordinary) shareholders’ meeting of the Company on October 23, 2015;
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"Presence"
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refers to the presence of the Beneficiary in his or her capacity as employee and/or corporate officer of the Company or of any of the companies of the Group;
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"Restricted Stock Units"
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refers to a promise by the Company to deliver to the Beneficiary on the Vesting Date, at no consideration, Ordinary Shares subject to the vesting conditions set forth by the Time-Based Plan. Dividend, voting and other shareholder rights will not apply until the issuance or transfer of Ordinary Shares at the time of vesting of the Restricted Stock Units under the Time-Based Plan.
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"Secured Restricted Stock Units"
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Restricted Stock Units for which the Presence condition of the Beneficiary is met and for which underlying Ordinary Shares will be delivered to the relevant Beneficiary upon the Vesting Date.
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"Vesting Date"
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refers to the date on which the Ordinary Shares of the Company subject to the Restricted Stock Units are delivered to the relevant Beneficiary;
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"Vesting Period"
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refers to the minimum one year period starting on the Grant Date and ending on the Vesting Date, being specified that the Board of Directors may decide to extend this period for all or part of the Restricted Stock Units and/or provide for vesting in tranches, as stated in the corresponding Grant Letter;
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"Working Day"
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refers to any day on which legal business can be conducted within the Company, i.e. every Monday, Tuesday, Wednesday, Thursday and Friday, as long as it is not a public holiday.
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3. Purpose
The Time-Based Plan sets forth the conditions and criteria for the Grant of Restricted Stock Units under the Time-Based Plan, pursuant to Articles L. 225-197-1 et seq. of the French Commercial Code and to the authorization granted by the shareholders’ meeting of the Company dated October 23, 2015.
The purposes of the Time-Based Plan are:
• to attract and retain the best available personnel for positions of substantial responsibility;
• to provide additional incentive to Beneficiaries; and
• to promote the success of the Company's business.
4. Beneficiaries: Eligible Employees
Pursuant to the authorization of the shareholders’ general meeting dated October 23, 2015, the Board of Directors of the Company will approve the list of Beneficiaries among employees and corporate officers (who meet the conditions set forth by Article L. 225-197-1 II of the French Commercial Code) of the Group, together with the indication of the number of Restricted Stock Units granted to each of them.
5. Notice of the Grant of the Restricted Stock Units
The notice of the Grant of Restricted Stock Units to each Beneficiary shall be made pursuant to a Grant Letter made available to the Beneficiary together with a copy of the Time-Based Plan, indicating the number of Restricted Stock Units granted to the Beneficiary, the Vesting Period and the Holding Period, if any.
The Beneficiary shall acknowledge receipt of the Grant documentation comprised of the Grant Letter and of the Time-Based Plan by accepting online his or her documentation by means of the tool made available by the Company and by sending signed copies of the Grant Letter within 90 days from the date of notification by the Company of the availability on line of the Grant documentation, the documents being deemed to be received on the date of the electronic delivery, in the absence of which the Grant shall be null and void for this Beneficiary.
6. Vesting Period
6.1. Principle
(a) The Restricted Stock Units granted under the Time-Based Plan shall vest in the Beneficiaries at the end of the Vesting Period, subject to the continued Presence of the Beneficiary during the Vesting Period, in the absence of which he or she will not be entitled to acquire the shares underlying the Restricted Stock Units on the date when this condition is no longer met, except as set forth in Article 6.1(b).
Unless otherwise decided by the Board, should the Beneficiary be at the same time an employee and an officer of the same company or of two companies of the Group, the loss of one of these capacities shall not result in the loss of the right to vest in the Restricted Stock Units granted under the Time-Based Plan at the end of the Vesting Period.
Pursuant to Article L. 225-197-3 of the French Commercial Code, the Beneficiaries hold a claim against the Company which is personal and may not be transferred until the end of the Vesting Period, except in case of death.
During the Vesting Period, the Beneficiaries will not own the Ordinary Shares and will not be shareholders of the Company. As a consequence, they will not hold any rights attached to the Ordinary Shares.
(b) Unless otherwise determined by the Board of Directors at the time of the Grant and except with respect to any Beneficiary who is taxable on his/her Company employment income in one of the countries listed in Exhibit 1 at the time of the Grant (for whom this Article 6.1(b) shall not apply), if the Beneficiary ceases to be an employee or officer of the Group after the one-year anniversary of the Grant Date but prior to (i) the Vesting Date or (ii) in the case of a Grant that vests in tranches, the vesting date of the first tranche of the Grant (such date in either (i) or (ii), the "First Vesting Date”), then the Beneficiary shall definitively secure, on the First Vesting Date, the delivery of a number of Restricted Stock Units that is equal to the pro rata portion (measured by the ratio of the (A) total number of fully expired quarters elapsed from the Grant Date of the relevant Restricted Stock Units (included) to the date when the Beneficiary ceases to be an employee or officer of the Group (excluded) to (B) the total number of
quarters between the Grant Date included and the First Vesting Date (included)) of the number of Restricted Stock Units that the Beneficiary would have definitively secured and vested in on the First Vesting Date, had the continued Presence condition set forth in Article 6.1(a) been satisfied on such date (rounded to the nearest whole number). For instance:
•if the Beneficiary ceases to be an employee or officer of the Group the day following the first anniversary of the Grant Date and 50% of such Restricted Stock Units vest upon the second anniversary thereof, he shall vest on such second anniversary date in 25% (i.e., 4/8 * 50%) of his Restricted Stock Units, with the balance being automatically forfeited.
•if the Beneficiary ceases to be an employee or officer of the Group the day following the first anniversary plus three months of the Grant Date and 50% of such Restricted Stock Units vest upon the second anniversary thereof, he shall vest on such second anniversary date in 31.25% (i.e., 5/8 * 50%) of his Restricted Stock Units, with the balance being automatically forfeited.
For the avoidance of doubt, this Article 6.1(b) shall apply only for Grants where the First Vesting Date is more than one year after the Grant Date.
In the event of a Beneficiary who after the Grant Date and before the First Vesting Date would be relocated from a country not listed in the Exhibit 1 where he/she was taxable on his/her employment income to a country listed in the Exhibit 1 and who, before the time of the First Vesting Date, becomes taxable on his/her employment income in a country listed in the Exhibit 1, the provision of this Article 6.1 (b) shall be terminated; provided, however, that Restricted Stock Units that have become Secured Restricted Stock Units prior to the relocation to a country listed in Exhibit 1 shall remain secured and the underlying shares will be delivered upon the Vesting Date.
(c) In addition to any other powers set forth in the Time-Based Plan and subject to the provisions of the Time-Based Plan, the Board of Directors shall have the full and final power and authority, in its discretion, to determine the terms, conditions and restrictions applicable to each Grant (which need not be identical) and any Restricted Stock Units acquired pursuant thereto. Further, the Board of Directors shall have the full and final power and authority, in its discretion, to determine whether, to what extent, and under what circumstances a Grant may be settled, cancelled, forfeited, exchanged, or surrendered.
Notwithstanding Articles 6.5, 6.6 and 6.7 of the Time-Based Plan, the Board of Directors shall not accelerate or shorten the minimum Vesting Period of one year. For clarity, there shall be no automatic acceleration of vesting with respect to a Grant under the Time-Based Plan solely based on a Change in Control.
6.2 Compliance with Company Policies
a) Grant Subject to Clawback Policy. The Grant Letter shall contain an acknowledgement and agreement by the Beneficiary that any Grant pursuant to the Time-Based Plan shall be subject to any applicable clawback policy of the Company, as adopted by the Company from time to time, as well as to any clawback required by any applicable laws, regulations or trading rules of any exchange on which the Company’s shares are listed at such time.
b) Share Ownership Guidelines. Any Ordinary Shares acquired pursuant to the vesting of Restricted Stock Units may need to be retained by the Beneficiary in order to comply with the Company’s Share Ownership Guidelines, to the extent applicable to the Beneficiary.
6.3 Internal mobility
In the event of transfer or temporary assignment of the Beneficiary within a company of the Group, implying (i) the termination of the initial employment agreement and the entering into of a new employment agreement or of a position as officer, and/or (ii) a resignation of the Beneficiary from his or her position as officer and the acceptance of a new position of officer or the entering into of a new employment agreement in one of such companies, the Beneficiary shall retain his or her right to vest in the Restricted Stock Units at the end of the Vesting Period.
6.4 Agreed Leave of Absence Exceeding Three Months
In the event a Beneficiary is on an Agreed Leave, such Beneficiary’s Grant(s) shall (a) stop vesting on the first day of the quarter immediately following the quarter during which the Agreed Leave begins; and (b) resume vesting on the first day of the quarter immediately following the quarter in which the Agreed Leave ends. As a result of any Agreed Leave, the Vesting Period for the applicable Grant(s) shall be extended in accordance with this Article 6.4.
6.5 Disability
In the event of Disability before the end of the Vesting Period, the Restricted Stock Units shall vest in the Beneficiary on the date of Disability.
6.6 Death
In the event of the death of the Beneficiary during the Vesting Period, the Restricted Stock Units shall vest at the date of the request for vesting duly made by his or her beneficiaries in the framework of the inheritance.
The request for vesting of the Restricted Stock Units shall be made within six months from the date of death in compliance with Article L. 225-197-3 of the French Commercial Code.
6.7 Retirement
In the event of the retirement of a Beneficiary during the Vesting Period, and notwithstanding the number of Restricted Stock Units that may vest pursuant to Article 6.1(b) upon the retirement of such Beneficiary, the Board of Directors of the Company may decide that the conditions set forth in Article 6.1 above shall be deemed to be met for all or part of the Restricted Stock Units prior to the date of such retirement.
6.8 Change in Control
a) Unless otherwise provided by the Board of Directors, an agreement between a Group company and the Beneficiary or in the applicable Grant Letter, in the event of a Change in Control:
i. Where the successor corporation or parent or subsidiary of the successor corporation does not agree to assume or substitute for any outstanding Grant, for each Grant that is not assumed or substituted for and for which the Grant Date is at least one year prior to the consummation of the Change in Control, the restrictions and forfeiture conditions applicable to the Vesting Period shall lapse and the Restricted Stock Units shall be deemed fully vested prior to the consummation of the Change in Control. Any Grant for which the Grant Date is less than one year prior to the consummation of the Change in Control shall either be assumed or substituted for in accordance with Article 6.8(a)(ii) or cancelled in accordance with Article 6.8(a)(iii) below.
ii. For the purposes of this Article 6.8, a Grant will be considered assumed or substituted if, (A) following the Change in Control, the Grant confers the right to receive, for each Restricted Stock Unit subject to the Grant immediately prior to the Change in Control, the consideration (whether stock, cash, or other securities or property) or the fair market value, as determined by the Board of Directors in good faith, of the consideration received in the Change in Control by holders of Ordinary Shares for each such share held on the effective date of the transaction; provided,
however, that if such consideration received in the Change in Control is not solely common stock of the successor corporation or its parent, the Board of Directors may, with the consent of the successor corporation, provide that the consideration to be received for each Restricted Stock Units shall be solely common stock of the successor corporation or its parent equal in fair market value, as determined by the Board of Directors in good faith, to the per share consideration received by holders of Ordinary Shares in the Change in Control; (B) any securities of the successor corporation or its parent forming part of the Grant following the Change in Control are freely tradable on a major stock exchange; and (C) the Grant otherwise remains subject to the same terms and conditions that were applicable to the Grant immediately prior to the Change in Control.
iii. Notwithstanding any other provision of the Time-Based Plan, in the event of a Change in Control, except as would otherwise result in adverse tax consequences under Section 409A of the U.S. Internal Revenue Code, the Board of Directors may, in its discretion, provide that each Grant shall, immediately upon the occurrence of a Change in Control, be cancelled in exchange for a payment in cash or securities in an amount equal to (i) the consideration paid per Ordinary Share in the Change in Control multiplied by (ii) the number of Restricted Stock Units granted under the Grant. The Board of Directors shall not be required to treat all Grants similarly for purposes of this Article 6.8(a). Payment of amounts under this Article 6.8(a) shall be made in such form, on such terms and subject to such conditions as the Board of Directors determines in its discretion, which may or may not be the same as the form, terms and conditions applicable to payments to the Company's shareholders in connection with the Change in Control and may, in the Board of Directors’ discretion, include subjecting such payments to vesting conditions comparable to the Grants surrendered, subjecting such payments to escrow or holdback provisions comparable to those imposed upon the Company's shareholders in connection with the Change in Control, or calculating and paying the present value of payments that would otherwise be subject to escrow or holdback terms.
b) The obligations of the Company under the Time-Based Plan shall be binding upon any successor corporation or organization resulting from the Change in Control.
7. Holding Period
7.1 Principle
a) During the Holding Period, if any, the Beneficiaries concerned will be the owner of the Ordinary Shares underlying the Restricted Stock Units granted under the Time-Based Plan and will be shareholders of the Company. As a consequence, they will benefit from all the rights attached to the capacity of shareholder of the Company.
However, the Ordinary Shares underlying the Restricted Stock Unit shall not be transferable during the Holding Period (if any) and the Beneficiaries may not transfer or pledge those shares, by any means, or convert them into the bearer form.
b) At the end of the Holding Period (if any), the Ordinary Shares underlying the Restricted Stock Unit will be fully transferable, subject to the provisions of the following paragraph.
At the end of the Holding Period, if any, the Ordinary Shares underlying the Restricted Stock Unit granted under the Time-Based Plan may not be transferred (i) if a "black-out” period is in effect pursuant to the Company’s Insider Trading Policy, as in effect at such time, or (ii) otherwise in contravention of any applicable laws or regulations, or trading rules or restrictions of any exchange on which the Company’s shares are listed at such time.
7.2 Specific situations
Notwithstanding the provisions of the second paragraph of Article 7.1 above, the Ordinary Shares underlying the Restricted Stock Unit delivered to the Beneficiaries referred to in Article 6.4 above or to the beneficiaries of the deceased Beneficiary referred to in Article 6.5 above may be freely transferred as from the date of their vesting.
8. Characteristics of the Ordinary Shares
The Ordinary Shares delivered pursuant to the vesting of the Restricted Stock Units that shall be, at the Company’s choice, new shares to be issued by the Company or existing shares acquired by the Company.
As from the Vesting Date, the Ordinary Shares delivered pursuant to the Restricted Stock Units shall be subject to all the provisions of the Bylaws. They shall be assimilated to existing Ordinary Shares and shall benefit from the same rights as from the Vesting Date.
Restricted Stock Units that do not vest do not give right to any dividend paid or dividend equivalent accumulated prior to the Vesting Date.
9. Delivery and holding of the Restricted Stock Units
At the end of the Vesting Period, the Company shall deliver to the Beneficiary the Ordinary Shares underlying the Restricted Stock Units vested under the Time-Based Plan, provided that the conditions and criteria for such vesting provided by Articles 5 and 6 above are met. However, Ordinary Shares may not be delivered in fractional shares. Unless otherwise provided in an award agreement or grant letter, the number of Ordinary Shares delivered at the end of any Vesting Period will always be rounded to the nearest whole number, provided however that the rounding does not result in the issuance of Ordinary Shares in excess of the total number of Ordinary Shares subject to the Grant.
If the Vesting Date is not a Working Day, the delivery of the Ordinary Shares shall be completed the first Working Day following the end of the Vesting Period.
The Ordinary Shares underlying the Restricted Stock Units that may be vested under the Time-Based Plan will be held, during the Holding Period, if any, in nominative form (nominatif pur) in an individual account opened in the name of the relevant Beneficiary at BNPP Securities Services with a legend stating that they cannot be transferred. If the provisions of Article 7.1(b) above are applicable at the end of the Holding Period (or the end of the Vesting Period if there is no Holding Period), the Ordinary Shares underlying the Restricted Stock Units shall remain in nominative form (nominatif pur) at BNPP Securities Services until such time as they are transferred to make sure that the restrictions set forth in Article 7.1(b) above are complied with.
In the event that, as a consequence of the Grant of Restricted Stock Units under the Time-Based Plan, the Company or any of the companies of the Group shall be compelled to pay taxes, social costs or any other social security taxes or contributions on behalf of the Beneficiary, the Company retains the right to postpone or to forbid the delivery of the Ordinary Shares on the Vesting Date until the relevant Beneficiary has paid to the Company or to the relevant company of the Group the amount corresponding to these taxes, social costs, or social security taxes or contributions.
10. Shares subject to plan; individual limitations
10.1 Shares Available.
Subject to adjustment as provided in Articles 11 and 12, the maximum aggregate number of Ordinary Shares underlying the Restricted Stock Units that may be delivered under the Time-Based Plan shall not exceed the number of shares remaining available for issuance or transfer under the Company’s equity compensation plans pursuant to authorizations previously approved by the shareholders of the Company, as of the Grant Date, that are
not subject to outstanding awards thereunder. Any Restricted Stock Unit granted in connection with the Time-Based Plan (i.e., grants other than options or warrants) shall be counted against this limit as 1.57 shares for every one Ordinary Share underlying the Restricted Stock Unit granted in connection with such Grant. Ordinary Shares subject to the Time-Based Plan shall consist of authorized but unissued shares, as well as existing shares of the Company.
In the event that a Grant, or any part thereof, for any reason is terminated or canceled without having vested, the Ordinary Shares subject to the unvested and forfeited portion of the Restricted Stock Units relating to such Grant shall, provided the Time-Based Plan is still in force, again be available for future Grant pursuant to the Time-Based Plan or the 2015 Performance Based Plan. Notwithstanding any provision of the Time-Based Plan or the Appendix thereunder to the contrary, shares withheld or reacquired by the Company in satisfaction of tax withholding obligations with respect to a Beneficiary shall not again be available for issuance or transfer under the Time-Based Plan.
11. Intermediary operations
Subject to Article 6.8, in the event of exchange of shares without any payment in cash (soulte) resulting from a merger or split-up completed during the Vesting Period or the Holding Period (if any), the remainder of such period(s) shall apply to the rights to receive Ordinary Shares underlying Restricted Stock Units of the Company or shares of the surviving entity received by the Beneficiary in exchange for his rights to receive Ordinary Shares underlying Restricted Stock Units.
The same shall apply in the event of exchange resulting from a public tender offer, a stock split or reverse stock split completed in compliance with applicable regulations during the Holding Period, if any.
12. Adjustment
Should the Company, during the Vesting Period, undergo an amortization, reduce its share capital, change the allocation of its profits, allocate Ordinary Shares to all the shareholders, capitalize reserves, profits or issuance premiums, allocate reserves or issue equity securities or give a right to the allocation of equity securities, including a preferential subscription right reserved to the shareholders or any other corporate transaction or event having an effect similar to any of the foregoing, the maximum number of Ordinary Shares underlying Restricted Stock Units granted under the Time-Based Plan may be adjusted in order to take into account said operation by application, mutatis mutandis, of the terms of adjustment provided by the law for the beneficiaries of stock options as per Article L. 225-181 and Article L. 228-99 of the French commercial code.
Each Beneficiary shall be informed of the practical terms of the adjustment and of its consequences on the Grant of Restricted Stock Units he or she benefited from, it being specified that the Restricted Stock Units of the Company granted pursuant to this adjustment shall be governed by the Time-Based Plan.
13. Amendment to the Time-Based Plan
13.1 Principle
The Time-Based Plan may be amended by the Board of Directors, provided that any such amendment shall be subject to shareholder approval to the extent required in order to comply with applicable law or the rules of the Nasdaq Stock Market. Any such amendment shall be subject to the written consent of the Beneficiaries if it results in a decrease in the rights of said Beneficiaries, unless such amendment is necessary or appropriate to comply with or facilitate compliance with applicable laws or other rules, regulations or requirements, as determined by the Board of Directors (or its delegate).
The new provisions shall apply to the Beneficiaries of the Restricted Stock Units during the Vesting Period on the date of the decision to amend the Time-Based Plan made by the Board of Directors, or the written consent of the Beneficiary, if required.
13.2 Notice of the amendments
The affected Beneficiaries shall be notified of an amendment to the Time-Based Plan, by any reasonable means, including by electronic delivery, internal mail, by simple letter or, with acknowledgement of receipt, by fax or by e-mail.
14. Tax and social rules
The Beneficiary shall bear all taxes and mandatory costs which he or she must bear pursuant to the applicable law in relation to the grant of Restricted Stock Units, on the due date of said taxes or costs.
Each Beneficiary shall verify and carry out, as the case may be, the reporting obligations he or she must comply with in relation to the grant of the Restricted Stock Units.
15. Miscellaneous
15.1 Rights in relation to the capacity of employee
No provisions of the Time-Based Plan shall be construed as granting to the Beneficiary a right to have his or her employment agreement with the Company or any of the companies of the Group maintained, or limiting the right of the Company or any of the companies of the Group to terminate or amend the terms and conditions of the employment agreement of the Beneficiary.
15.2 Rights in relation to future Restricted Stock Units plans and Nature of Grant
Rights in relation to future Restricted Stock Units plans. The fact that a person may benefit from the Time-Based Plan does not imply that he or she shall benefit from any other plan that may be implemented thereafter.
Nature of Grant. In accepting any Grant under the Time-Based Plan, the Beneficiary acknowledges that:
(a) the Time-Based Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Time-Based Plan;
(b) the grant of the Restricted Stock Units is voluntary and occasional and does not create any contractual or other right to receive future grants of Restricted Stock Units, or benefits in lieu of Restricted Stock Units, even if Restricted Stock Units have been granted repeatedly in the past;
(c) all decisions with respect to future grants, if any, will be at the sole discretion of the Company;
(d) Beneficiary’s participation in the Time-Based Plan shall not create a right to further employment with the Employer and shall not interfere with the ability of the Employer to terminate Beneficiary’s employment relationship at any time with or without cause unless otherwise required under local law;
(e) Beneficiary is voluntarily participating in the Time-Based Plan;
(f) the Restricted Stock Units are an extraordinary item that do not constitute compensation of any kind for services of any kind rendered to the Company or the Employer, and which is outside the scope of Beneficiary’s employment contract, if any;
(g) the Restricted Stock Units are not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long service awards, pension or retirement benefits or similar payments and in no event
should be considered as compensation for, or relating in any way to, past services for the Company or the Employer;
(h) in the event that Beneficiary is not an employee of the Company, the grant will not be interpreted to form an employment agreement or relationship with the Company; and furthermore, the grant will not be interpreted to form an employment agreement with the Employer or any subsidiary or affiliate of the Company;
(i) the future value of the underlying Ordinary Shares is unknown and cannot be predicted with certainty;
(j) if the Beneficiary obtains Ordinary Shares, the value of those Ordinary Shares may increase or decrease;
(k) in consideration of the grant, no claim or entitlement to compensation or damages shall arise from termination of the award of Restricted Stock Units or diminution in value of the award resulting from termination of the Beneficiary’s employment with the Company or the Employer (for any reason whatsoever) and the Beneficiary irrevocably releases the Company and the Employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing the Time-Based Plan, the Beneficiary shall be deemed irrevocably to have waived the Beneficiary’s entitlement to pursue such claim; and
(l) unless otherwise decided by the Board of Directors, in the event of termination of Beneficiary’s employment during the Vesting Period, Beneficiary’s right to vest in the Restricted Stock Units under the Time-Based Plan, if any, will terminate effective as of the date that Beneficiary is no longer actively employed and will not be extended by any notice period mandated under the local law (e.g., active employment would not include a period of "garden leave” or similar period pursuant to local law).
15.3 Applicable law - Jurisdiction
The Time-Based Plan is subject to French law. Any dispute relating to its validity, its interpretation or its performance shall be decided by the competent courts of the French Republic.
15.4 Provisions Applicable to Beneficiaries Located outside of France
The attached Appendix applies to Beneficiaries located outside of France at the time of the relevant taxable event.
16. Data Privacy
As part of the 2015 Time-Based Plan, the Company processes some personal data of the Beneficiary. For this processing, the Company acts as the controller of this personal data and in accordance with the provisions of Regulation (EU) 2016/679 and, where applicable, those of Act No. 78-17 known as "Information technology & Civil Liberties", as amended, together the "Personal Data Regulation". Undefined terms used in this clause have the meaning given to them pursuant to the Personal Data Regulation.
The Company processes the Beneficiary's personal data on the legal basis of the conclusion and performance of the contract concluded at the time of the Beneficiary's acceptance of the Grant Letter. The purpose of the contract is to implement, administer and manage the Beneficiary's participation in the 2015 Time-Based Plan. Processed personal data are those strictly necessary for the aforementioned purposes. Especially, this includes the following information: the Beneficiary's name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares or directorships held in the Company, details of all awards or any other entitlement Shares awarded, cancelled, exercised, vested, unvested or outstanding in Beneficiary's favor (the "Data"). Failure by the Beneficiary to provide certain Data could compromise the
conclusion and performance of the contract concluded at the time of the Beneficiary's acceptance of the Grant Letter.
The Company may disclose the Data to the Employer, subsidiaries and affiliated companies, sub-contractors, banking and financial organizations on a need-to-know basis. These entities may be located outside the European Union and in countries that have not been subject of an adequacy decision. If the recipients are located in other countries that do not provide an adequate level of protection for personal data, the Company will take all necessary measures and guarantees to ensure such a level and to supervise such transfers of Data in accordance with the Personal Data Regulation , in particular by implementing standard contractual clauses of the European Commission. The Beneficiary may request a copy of these guarantees by writing to the Data Protection Officer at the following address: dpo@criteo.com.
In accordance with the Personal Data Regulation, where applicable, the Beneficiary has the right to access, rectify, delete, limit processing and transfer his Data. To exercise these rights, the Beneficiary may contact the Data Protection Officer at dpo@criteo.com. The Beneficiary also has the right to file a complaint with the competent supervisory authority and to communicate to the Company instructions for the storage, deletion and communication of its Data after its death.
In the context of this processing, the Data will not be kept for longer than necessary for the purposes referred to in this clause. In any event, the Company will comply with the retention periods imposed by law.
17. Electronic Delivery
The Company may, in its sole discretion, decide to deliver any documents related to the Time-Based Plan or future awards that may be granted under the Time-Based Plan by electronic means or to request Beneficiary’s consent to participate in the Time-Based Plan by electronic means. Beneficiary hereby consents to receive such documents by electronic delivery and, if requested, to agree to participate in the Time-Based Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
18. Severability
The provisions of this Time-Based Plan are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
APPENDIX
TERMS AND CONDITIONS
This Appendix contains additional terms and conditions that will apply to the Beneficiary if he or she resides outside of France. Capitalized terms used but not defined herein shall have the same meanings assigned to them in the Time-Based Plan.
NOTIFICATIONS
This Appendix also includes information regarding exchange control and certain other issues of which the Beneficiary should be aware with respect to his or her participation in the Time-Based Plan. The information is based on the securities, exchange control and other laws in effect in the respective countries as of July 2015. Such laws are often complex and change frequently. The Company therefore strongly recommends that the Beneficiary not rely on the information in this Appendix as the only source of information relating to the consequences of his or her participation in the Time-Based Plan because such information may be outdated when the Beneficiary vests in the Restricted Stock Units and/or sells any shares delivered pursuant to the award.
GENERAL PROVISIONS
Taxes. Regardless of any action the Company or the Beneficiaries’ employer (the "Employer”) takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding ("Tax-Related Items”), the Beneficiary acknowledges that the ultimate liability for all Tax-Related Items legally due by the Beneficiary is and remains the Beneficiary’s responsibility and that the Company and/or the Employer (1) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Restricted Stock Units grant, including the grant, vesting of the Restricted Stock Units, the subsequent sale of Ordinary Shares underlying Restricted Stock Units delivered pursuant to such vesting and the receipt of any dividends; and (2) do not commit to structure the terms of the grant or any aspect of the Restricted Stock Units to reduce or eliminate the Beneficiary’s liability for Tax-Related Items.
Prior to vesting of the Restricted Stock Units, the Beneficiary will pay or make adequate arrangements satisfactory to the Company and/or the Employer to satisfy all withholding obligations of the Company and/or the Employer, if any. In this regard, the Beneficiary authorizes the Company and/or the Employer to withhold all applicable Tax-Related Items legally payable by the Beneficiary from the Beneficiary’s compensation paid to the Beneficiary by the Company and/or Employer or from proceeds of the sale of shares underlying the Restricted Stock Units. Alternatively, or in addition, if permissible under local law, and with respect to any individual who is determined by Criteo to be an "officer” as defined by Rule 16a-1(f) promulgated under the Securities Exchange Act of 1934, as amended (the Exchange Act), or an "executive officer” as defined by Rule 3b-7 promulgated under the Exchange Act, the Company may, (1) sell or arrange for the sale of shares underlying the vested Restricted Stock Units to meet the withholding obligation for Tax-Related Items and/or (2) withhold in shares, provided that, to the extent required under applicable accounting or tax rules, the Company only withholds the amount of shares necessary to satisfy the withholding amount, and further provided that any such withholding of shares shall be subject to advance approval by the Board of Directors or a committee thereof as constituted in accordance with Rule 16b-3 under the Exchange Act. Finally, the Beneficiary will pay to the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold as a result of the Beneficiary’s participation in the Time-Based Plan or the Beneficiary’s Vesting of Restricted Stock Units that cannot be satisfied by the means previously described. The Company may refuse to honor the vesting and refuse to deliver the shares underlying the vested Restricted Stock Units if the Beneficiary fails to comply with Beneficiary’s obligations in connection with the Tax-Related Items as described in this section.
For tax residents of the United States
Beneficiary acknowledges that both this award and any underlying Ordinary Shares are securities, the issuance or transfer of which by the Company requires compliance with federal and state securities laws.
Beneficiary acknowledges that these securities are made available to Beneficiary only on the condition that Beneficiary makes the representations contained in this section to the Company.
Beneficiary has made a reasonable investigation of the affairs of the Company sufficient to be well informed as to the rights and the value of these securities.
The intent of the parties is that payments and benefits under the Time-Based Plan comply with, or be exempt from, Section 409A of the Internal Revenue Code of 1986, as amended (the "Code") to the extent subject thereto, and, accordingly, to the maximum extent permitted, the Time-Based Plan and the Grant Letters thereunder shall be interpreted and be administered to be in compliance therewith or exempt therefrom. Notwithstanding anything contained herein to the contrary, to the extent required to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, the Beneficiary shall not be considered to have separated from service with the Company for purposes of this the Time-Based Plan and no payment or benefit shall be due to the Beneficiary under the Time-Based Plan and the Grant Letters thereunder on account of a separation from service until the Beneficiary would be considered to have incurred a "separation from service” from the Company within the meaning of Section 409A of the Code. Any payments or benefits (including vesting grants) described in the Time-Based Plan and the Grant Letters thereunder that are due within the "short-term deferral period” as defined in Section 409A of the Code shall not be treated as deferred compensation unless applicable law requires otherwise. Notwithstanding anything to the contrary in the Plan and the Grant Letters thereunder, to the extent that any amounts are payable upon a separation from service and such payment would result in accelerated taxation and/or tax penalties under Section 409A of the Code due to the Beneficiary’s status as a "specified employee” within the meaning of Section 409A of the Code, such payment, under the Plan or any other agreement of the Company, shall be made on the first business day after the date that is six (6) months following such separation from service (or death, if earlier). Further notwithstanding anything to the contrary in the Plan, to the extent required under Section 409A of the Code to make payment of an award upon a Change in Control, the applicable transaction or event defined in Article 2 and described in Article 6.9 of the Plan must qualify as a "change in control event” within the meaning of Section 409A of the Code and the regulations promulgated thereunder, and if it does not, then unless otherwise specified in the applicable Grant Letter, any Restricted Stock Units vested in the Beneficiary upon a Change in Control shall be delivered on their originally specified Vesting Date, in accordance with Article 9 of the Plan (or death, if earlier).
For Beneficiaries who are United States taxpayers, notwithstanding anything to the contrary contained in Article 6.4 of the Time-Based Plan, the shares underlying the Restricted Stock Units shall be delivered to the Beneficiary no later than 90 days following the date of the Beneficiary’s Disability; provided, that any such Disability will be within the meaning of Section 409A of the Code and the regulations promulgated thereunder, and if it is not, any Restricted Stock Units vested in the Beneficiary upon Disability shall be delivered on their originally specified Vesting Date, in accordance with Article 9 of the Plan (or death, if earlier).
For Beneficiaries who are United States taxpayers, notwithstanding anything to the contrary contained in Article 6.5 of the Time-Based Plan, the Restricted Stock Units shall be delivered no later than no later than 90 days following the date of the Beneficiary’s Disability death, but in any event no later than December 31st of the calendar year following the year of the Beneficiary’s death to the extent permitted by Section 409A of the Code.
The Company makes no representation that any or all of the payments described in the Time-Based Plan and the Grant Letters thereunder will be exempt from or comply with Section 409A of the Code and makes no undertaking
to preclude Section 409A of the Code from applying to any such payment. The Grantee shall be solely responsible for the payment of any taxes and penalties incurred under Section 409A.
The Company makes no representation as to the tax status of the Time-Based Plan to the Beneficiary who should seek his or her own tax advice.
For Israeli Tax Residents
Upon grant of Restricted Stock Units, if the award is made to an employee, director or officer of an Israeli resident member of the Group (the "Approved Israeli Participants"), and is intended to qualify for beneficial tax treatment pursuant to the trustee capital gains route of Section 102 of the Israeli Income Tax Ordinance [New Version] 1961 ("Trustee 102 Awards", "Capital Gains Route" and "Ordinance") the following provisions shall apply. The designation of a Restricted Stock Unit as a Trustee 102 Award shall be determined by the Board of Directors or any committee thereof. Unless otherwise specifically determined, all Restricted Stock Units awards to Approved Israeli Participants are intended to be Trustee 102 Awards. The provisions below set out the terms and conditions applicable to Trustee 102 Awards granted to Approved Israeli Participants, as defined below, in order to satisfy Israeli tax requirements. If the terms are not met the Restricted Stock Units shall be subject to tax pursuant to the non-trustee route of Section 102 or Section 2 or 3(i) of the Ordinance.
Trustee 102 Awards and/or any Ordinary Shares allocated or issued upon the vesting of a Trustee 102 Award and/or other Ordinary Shares received following any realization of rights under the Plan, shall be allocated or issued to the trustee appointed by the Company and/or its Israeli subsidiary pursuant to the provisions of Section 102 of the Ordinance (the "102 Trustee") or controlled by the 102 Trustee, for the benefit of the Approved Israeli Participants, in accordance with the provisions of Section 102 of the Ordinance. In the event the requirements for Trustee 102 Awards are not met, the Trustee 102 Awards may be regarded as awards subject to tax pursuant to Section 102(c) of the Ordinance or as awards which are not subject to Section 102, all in accordance with the provisions of Section 102.
With respect to any Trustee 102 Award, subject to the provisions of Section 102, an Approved Israeli Participant shall not sell or release from trust any Ordinary Shares received upon the grant, vesting or exercise of a Trustee 102 Award and/or any Ordinary Shares received following any realization of rights, including, without limitation, stock dividends, under the Plan at least until the lapse of the period of time required under Section 102 or any shorter period of time determined by the ITA (the “102 Holding Period”). Notwithstanding the foregoing, if any such sale or release occurs during the 102 Holding Period, the sanctions under Section 102 shall apply to and shall be borne by such Approved Israeli Participant.
Notwithstanding anything to the contrary, the 102 Trustee shall not release or sell any Ordinary Shares allocated or issued upon the vesting of a Trustee 102 Award unless the Company, the Group and the 102 Trustee are satisfied that the full amounts of any Tax due have been paid or will be paid.
Upon receipt of any Trustee 102 Award, the Approved Israeli Participant will consent to the grant of such award under Section 102 and undertake to comply with the terms of Section 102 and the trust arrangement between the Company and the 102 Trustee.
Each Trustee 102 Award will be deemed granted on the Grant Date, provided that and subject to (i) the Approved Israeli Participant has signed all documents required by the Company or applicable law, and (ii) the Company has provided all applicable documents to the 102 Trustee in accordance with the guidelines published by the ITA such that if the guidelines are not met the 102 Award will be considered as granted under Section 102(c) of the Ordinance.
Notwithstanding any provision of the Plan, no Trustee 102 Award or any right with respect thereto, whether fully paid or not, shall be assignable, transferable or given as collateral, and no right with respect to any such award shall be given to any third party whatsoever, and during the lifetime of the Approved Israeli Participant, each and all of such Approved Israeli Participant’s rights with respect to an award shall belong only to the Approved Israeli Participant. Any such action made, directly or indirectly, for an immediate or future validation, shall be void. As long as Restricted Stock Units and/or Ordinary Shares issued or purchased hereunder are held by the 102 Trustee on behalf of the Approved Israeli Participant, all rights of the Approved Israeli Participant over the Restricted Stock Units and Ordinary Shares cannot be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution.
With regard to Trustee 102 Awards, the provisions of Section 102 and any approval issued by the ITA shall be deemed an integral part of the Plan and the Grant Letter. Any provision of Section 102 and/or said approval issued by the ITA, which must be complied with in order to receive and/or to maintain any tax treatment with respect to a Trustee 102 Award, which is not expressly specified herein, shall be considered binding upon the Company and the Approved Israeli Participants. Furthermore, if any provision of the Plan disqualifies Trustee 102 Awards from the beneficial tax treatment pursuant to Section 102, such provision shall not apply to the Trustee 102 Awards.
Any tax consequences arising from the grant, vesting or sale of any Trustee 102 Award or Ordinary Shares covered thereby or from any other event or act (of the Company, and/or the Group, and the 102 Trustee or the Approved Israeli Participant), hereunder, shall be borne solely by the Approved Israeli Participant. The Company and/or the Group, and/or the 102 Trustee shall withhold tax according to the requirements of applicable laws, rules, and regulations, including withholding taxes at source. Furthermore, the Approved Israeli Participant agrees to indemnify the Company and/or the Group and/or the 102 Trustee and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Approved Israeli Participant. The Company and/or, when applicable, the 102 Trustee shall not be required to release any Ordinary Shares to an Approved Israeli Participant until all required tax payments have been fully made.
Exhibit 1
List of Countries
•Canada
•Japan
•Singapore
•The Netherlands
Exhibit 2
Form of Grant Letter
[Beneficiary Name and Address]
[Date]
Letter delivered by electronic delivery
[Name of Beneficiary],
We have the pleasure to inform you that, pursuant to the authorization granted by the shareholders’ meeting held on [June 9, 2020], the board of directors of Criteo (the « Company »), during its meeting held on [ ] (the « Grant Date »), granted to you Restricted Stock Units of the Company, under the terms and conditions provided for in Articles L. 225-197-1 to L. 225-197-5 of the French Commercial Code and in the Amended and Restated 2015 Time-Based Restricted Stock Units Plan of the Company (the « the Time-Based Plan »). Capitalized terms that are used but not defined herein shall have the meaning ascribed to such terms in the Time-Based Plan.
The board of directors granted to you [ ] restricted stock units of the Company (the « Shares »), with a par value of EUR 0.025 each.
The period (« Vesting Period ») at the end of which the grant will become effective and final (i.e., the Shares will be delivered to you and be your property), has been set at [ ] years as from the Grant Date: [details of vesting scheduled to be inserted]. [Except as provided below], the Shares will thus vest at the end of the Vesting Period unless you shall cease to be an employee of the Criteo group for any reason whatsoever during the Vesting Period (subject to the following paragraph).
[In the event you cease to be an employee or officer of the Group after the one-year anniversary of the Grant Date but prior to the First Vesting Date, you shall vest in, on the First Vesting Date, a number of Shares that is equal to the pro rata portion (measured by the ratio of (A) the number of quarters elapsed from the Grant Date included to the date you cease to be an employee or officer of the Group (excluded) to (B) the total number of quarters between the Grant Date (included) and the First Vesting Date (excluded)) of the number of Shares that you would have vested on the First Vesting Date had you remained an employee or officer of the Group until such date (the « Prorated Vesting »).] [Notwithstanding the foregoing, if you are a tax resident of the United States, the Company will be required to withhold Federal Insurance Contributions Act taxes in respect of your vesting gain as of the first anniversary of the Grant Date.]
In the event of Disability before the end of the Vesting Period, the Restricted Stock Units shall vest on the date of Disability. In the event of death of during the Vesting Period, the Restricted Stock Units shall vest at the date of the request made by your beneficiaries in the framework of the inheritance. The request for the Shares shall be made within six (6) months from the date of death in compliance with Article L. 225-197-3 of the French Commercial Code.
Neither the Time-Based Plan nor this letter shall confer upon you any right to be retained in any position, as an employee, consultant or director of the Company. Further, nothing in the Time-Based Plan or this letter shall be construed to limit the discretion of the Company to terminate your continuous service at any time, with or without cause.
By acknowledging this grant, you hereby acknowledge and agree that any Grant pursuant to the Time-Based Plan shall be subject to any applicable Criteo clawback policy, as adopted by Criteo from time to time, as
well as to any clawback required by any applicable laws, regulations or trading rules of any exchange on which the Company’s shares are listed at such time.
[To be included for the employees of the Israeli subsidiary: The Restricted Stock Units are intended to be subject to tax pursuant to the trustee capital gains route of Section 102 of the Ordinance, subject to compliance with the requirements under Section 102 and any rules or regulations thereunder, including the execution of this Grant Letter and the required declarations. However, in the event the Restricted Stock Units do not meet the requirements of Section 102, such Restricted Stock Units and the underlying Ordinary Shares shall not qualify for the favorable tax treatment under the Capital Gains Route. The Company makes no representations or guarantees that the Restricted Stock Units will qualify for favorable tax treatment and will not be liable or responsible if favorable tax treatment is not available under Section 102. The Restricted Stock Units and the Ordinary Shares issued upon vesting and/or any additional rights, as detailed above, including without limitation any right to receive any dividends or any shares received as a result of an adjustment made under the Plan, that may be granted in connection with the Restricted Stock Units (the “Additional Rights”) shall be issued to or controlled by the 102 Trustee for your benefit under the provisions of the Capital Gains Route for at least the period stated in Section 102 or any other period of time determined by the Israel Tax Authority (“ITA”). In accordance with the requirements of Section 102 and the Capital Gains Route, you shall not sell nor transfer from the 102 Trustee the Ordinary Shares or Additional Rights until the end of the 102 Holding Period. Notwithstanding the above, if any such sale or transfer occurs before the end of the 102 Holding Period, the sanctions under Section 102 shall apply and shall be borne by you. The Company and/or member of the Group and/or the 102 Trustee shall withhold taxes according to the requirements under the applicable laws, the rules, and regulations, including withholding taxes at source. Furthermore, you hereby agree to indemnify the Company and/or any member of the Group and/or the 102 Trustee and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to you. The Company and/or any member of the Group and/or the 102 Trustee, to the extent permitted by law, shall have the right to deduct from any payment otherwise due to you, or from proceeds of the sale of any Ordinary Shares, an amount equal to any tax required by law to be withheld with respect to such Ordinary Shares. You will pay to the Company, any member of the Group or the 102 Trustee any amount of taxes that the Company and/or any member of the Group or the Trustee may be required to withhold with respect to any Ordinary Shares that cannot be satisfied by the means previously described. The Company may refuse to deliver any Ordinary Shares if you fail to comply with your obligations in connection with the taxes as described in this section. Any fees associated with any vesting, sale, transfer or any act in relation to the Restricted Stock units and the Ordinary Shares issued upon vesting, shall be borne by you. The 102 Trustee and/or the Company and/or any member of the Group shall be entitled to withhold or deduct such fees from payments otherwise due to/from the Company or any member of the Group or the 102 Trustee.
[Security Law Exemption. If required, the Company will obtain an exemption from the requirement to file a prospectus with respect to the Restricted Stock Units. If obtained copies of the Plan and Form S-8 registration statement for the Plan filed with the U.S. Securities and Exchange Commission will be available free of charge upon request from your local human resources department.]
In addition to the acknowledgments noted above and in the Plan, you hereby understand, acknowledge, agree as follows: (i) you are familiar with the provisions of Section 102 of the Ordinance and the regulations and rules promulgated thereunder, including without limitations the provisions of the tax route applicable to your Restricted Stock Units and agree to comply with such provisions, as amended from time to time, provided that if such terms are not met, the specific tax route may not apply; (ii) you accept the provisions of the trust agreement signed between the Company and the 102 Trustee, and agree to be bound by its terms; (iii) you acknowledge that selling the Ordinary Shares or releasing the Ordinary Shares from the control of the 102 Trustee prior to the termination of the 102 Holding Period constitutes a violation of the terms of Section 102 and agree to bear the relevant sanctions; (iv) you authorize the Company to provide the plan administrator and the 102 Trustee with any information required for the purpose of administering the Plan including executing their obligations according to Section 102 of the Ordinance, the trust deed and the trust agreement, including without limitation information about your Restricted Stock Units, Ordinary Shares, income tax rates, salary bank account, contact details and identification
number and acknowledge that the information might be shared with an administrator who is located outside of Israel, where the level of protection of personal data is different than in Israel.]
The detailed terms of such grant are described in the Time-Based Plan, a copy of which is attached hereto. The Time-Based Plan is hereby incorporated by reference and made a part hereof, and the Restricted Stock Units granted herein shall be subject to all terms and conditions of the Time-Based Plan and this Grant Letter. In the event of any conflict between the provisions of this Grant Letter and the provisions of the Time-Based Plan, the provisions of the Time-Based Plan shall govern.
Thank you for sending a copy of the Time-Based Plan to people.experience@criteo.com, duly initialed and signed, not later than [90 days from the date of the Grant Letter], failing which the above grant shall be null and void.
Yours sincerely,
CRITEO
SIGNATURE PAGE
Acknowledged by: _________________________________ Date: _________________
(Print Name)
__________________________________
(Sign Name)
Please return a signed copy to people.experience@criteo.com.
APPENDIX C
Please note that because we are a French company, the full text of the plan has been translated from French. In the case of any discrepancy between this version and the French version, the French version will prevail.
CRITEO
AMENDED AND RESTATED 2015 PERFORMANCE-BASED RESTRICTED STOCK UNITS PLAN
Adopted by the Board of Directors on April 23, 2020
Approved by the Company's combined shareholders' general meetings of October 23, 2015, June 29, 2016 and June 28, 2017
Amended from time to time. Last amendment by the Board: April 7, 2021
TABLE OF CONTENTS
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1.
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IMPLEMENTATION OF THE PERFORMANCE BASED RESTRICTED STOCK UNIT PLAN…................................................
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2
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2.
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DEFINITIONS…...................................................................................
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2
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3.
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PURPOSE…..........................................................................................
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4
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4.
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BENEFICIARIES: ELIGIBLE EMPLOYEES….................................
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4
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5.
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NOTICE OF THE ALLOCATION OF THE RESTRICTED STOCK UNITS…................................................................................................
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4
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6.
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VESTING PERIOD…...........................................................................
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5
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7.
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HOLDING PERIOD…..........................................................................
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9
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8.
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CHARACTERISTICS OF THE ORDINARY SHARES…..................
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10
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9.
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DELIVERY AND HOLDING OF THE ORDINARY SHARES UNDERLYING THE RESTRICTED STOCK UNITS.........................
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10
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10.
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SHARES SUBJECT TO PLAN; INDIVIDUAL LIMITATIONS...
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11
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11.
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INTERMEDIARY OPERATIONS........................................................
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12
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12.
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ADJUSTMENT......................................................................................
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12
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13.
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AMENDMENT TO THE 2015 PERFORMANCE PLAN....................
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12
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14.
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TAX AND SOCIAL RULES.................................................................
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13
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15.
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MISCELLANEOUS..............................................................................
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13
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16.
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DATA PRIVACY....................................................................................
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14
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17.
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ELECTRONIC DELIVERY..................................................................
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15
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18.
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SEVERABILITY...................................................................................
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15
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1. IMPLEMENTATION OF THE PERFORMANCE BASED RESTRICTED STOCK UNIT PLAN
On July 30, 2015, the Board of Directors adopted the Original 2015 Performance Based Restricted Stock Unit Plan stating the conditions and criteria for the grant of Restricted Stock Units of Criteo, a French société anonyme whose registered office is located at 32, rue Blanche, 75009 Paris, France and whose identification number is 484 786 249 R.C.S. Paris (hereafter referred to as the “Company”) to the benefit of the chief executive officer and, from time to time, certain named executive officers, members of executive management and certain other employees of the Company or any company or economic interest group in which the Company holds, directly or indirectly, at least 10% of the share capital and voting rights at the date of grant of said shares, as determined by the Board of Directors. The Original 2015 Performance Based Restricted Stock Unit Plan was subsequently approved by the combined (ordinary and extraordinary) shareholders’ meeting of the Company, which also granted authority to the Board of Directors to grant Restricted Stock Units under the Original 2015 Performance Based Restricted Stock Unit Plan. On February 25, 2016, the Board of Directors adopted this amended and restated version of the Original 2015 Performance Based Restricted Stock Unit Plan (hereinafter, and as it may be amended from time to time in accordance with the provisions hereof, and in particular by the Board of Directors on April 7, 2016, on June 28, 2016, on April 4, 2018, on April 25, 2019, on April 23, 2020 and on April 7, 2021, the “2015 Performance Based Restricted Stock Unit Plan” or the "Performance Based Plan").
2. DEFINITIONS
Under the Performance Based Plan, the following terms and expressions starting with a capital letter shall have the following meaning and may be used indifferently in the singular or in the plural form:
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"Agreed Leave"
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refers to any leave of absence of more than three months having received a prior approval from the Company or requiring no prior approval under U.S. laws. Agreed Leaves shall include leaves for illnesses, military leave, and any other personal leave or conditions about which the employee has advance knowledge. Agreed Leave shall not include any absence considered as effective working time, such as maternity leave, of whatever duration, which shall not automatically result in a termination of the employment relationship between the Beneficiary and the Company or the Group.
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"Beneficiaries"
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refers to the person(s) for whose benefit the Board of Directors has approved a Grant of Restricted Stock Units under the Performance Based Plan as well as, as the case may be, his or her heirs.
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"Board of Directors"
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refers to the Company’s board of directors.
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"Bylaws"
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refers to the Company’s bylaws in force at the date referred to.
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"Change in Control"
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refers to (i) a merger (fusion) of the Company with or into another corporation, other than to another corporation, entity or person in which the holders of at least a majority of the voting rights and share capital of the Company outstanding immediately prior to such transaction continue to hold (either by such shares remaining outstanding in the continuing entity or by being converted into shares of voting rights and share capital of the surviving entity) a majority of the total voting rights and share capital of the Company (or the surviving entity) outstanding immediately after such transaction (an “Excluded Entity”), or (ii) the sale (vente) or other form of transfer by one or several shareholders of the Company to any person or group of persons of a number of Ordinary Shares such that the transferee(s) shall own a majority of the voting rights and share capital of the Company, or (iii) the sale, lease or other disposition, in a single transaction or in a series of related transactions, of all or substantially all of the assets of the Company other than to (1) a corporation or other entity of which at least a majority of its combined voting rights and share capital is owned directly or indirectly by the Company or (2) an Excluded Entity.
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"Disability"
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refers to the disability of a Beneficiary corresponding to the second or third of the categories provided by Article L. 341-4 of the French Social Security Code.
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"Grant Date"
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refers to the date when the Board of Directors decided to grant Restricted Stock Units under the 2015 Performance Based Restricted Stock Units Plan.
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"Grant Letter"
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refers to the notice, substantially in the form set forth in Exhibit 1, which informs a given Beneficiary of the Grant of Restricted Stock Units, as stated in Article 5 of the Performance Plan.
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"Grant"
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refers to the decision of the Board of Directors to grant Restricted Stock Units to a given Beneficiary, subject to the vesting conditions set forth by the Performance Based Plan as amended from time to time.
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"Group"
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refers to the Company and to all the companies and groups affiliated with the Company within in the meaning of Article L. 225-197-2 of the French Commercial Code.
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"Holding Period"
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refers to the period, if any, starting on the Vesting Date, during which a Beneficiary may not transfer or pledge his or her shares underlying the vested Restricted Stock Units, by any means, or convert them into the bearer form; it being specified that the total duration of both the Vesting Period and the Holding Period may in no event be less than two years as from the Grant Date pursuant to applicable French law.
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"Ordinary Share"
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refers to one ordinary share (action ordinaire) of the Company or an American Depositary Share representing one Share on the Nasdaq Global Market.
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"Original 2015 Performance Based Restricted Stock Units Plan"
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refers to the version of the 2015 Performance Based Stock Units Plan that was adopted by the Board of Directors on July 30, 2015 and approved by the combined (ordinary and extraordinary) shareholders’ meeting of the Company on October 23, 2015.
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"Restricted Stock Units"
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refers to a promise by the Company to deliver to the Beneficiary on the Vesting Date, at no consideration, Ordinary Shares, subject to the vesting conditions set forth by the Performance Based Plan. Dividend, voting and other shareholder rights will not apply until the issuance or transfer of Ordinary Shares at the time of vesting of the Restricted Stock Units under the Performance Based Plan.
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"Vesting Date"
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refers to the date on which the Ordinary Shares subject to the Restricted Stock Units are delivered to the relevant Beneficiary.
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"Vesting Period"
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refers to the minimum one year period starting on the Grant Date and ending on the Vesting Date, being specified that the Board of Directors may decide to extend this period for all or part of the Restricted Stock Units and/or provide for vesting in tranches, as stated in the corresponding Grant Letter.
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"Working Day"
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refers to any day on which legal business can be conducted within the Company, i.e. every Monday, Tuesday, Wednesday, Thursday and Friday, as long as it is not a public holiday.
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3. PURPOSE
The Performance Based Plan sets forth the conditions and criteria for the grant of Restricted Stock Units under the Performance Based Plan, pursuant to Articles L. 225-197-1 et seq. of the French Commercial Code and to the authorization granted by the shareholders’ meeting of the Company dated October 23, 2015.
The purposes of the Performance Based Plan are:
• to attract and retain the best available personnel for positions of substantial responsibility;
• to provide additional incentive to Beneficiaries, including performance incentives; and
• to promote the success of the Company's business.
4. BENEFICIARIES: ELIGIBLE EMPLOYEES
Pursuant to the authorization of the shareholders’ general meeting dated October 23, 2015 , the Board of Directors of the Company will approve the list of Beneficiaries among the chief executive officer and, from time to time, certain named executive officers, members of executive management and certain other employees of the Group, as determined by the Board of Directors, together with the indication of the number of Restricted Stock Units granted to each of them.
5. NOTICE OF THE GRANT OF THE RESTRICTED STOCK UNITS
The notice of the Grant of Restricted Stock Units to each Beneficiary shall be made pursuant to a Grant Letter made available to the Beneficiary together with a copy of the Performance Based Plan as amended and restated, indicating the number of Restricted Stock Units granted, the Vesting Period, the Holding Period, if any, and the Performance Targets (as described in Article 6.1 and 6.2).
The Beneficiary shall acknowledge receipt of the Grant documentation comprised of the Grant Letter and of the Performance Based Plan by accepting online his or her documentation by means of the tool made available by the Company and by sending signed copies of the Grant Letter within 90 days from the date of notification by the Company of the availability on line of the Grant documentation; the documents being deemed to be received on the date of the electronic delivery, in the absence of which, the Grant shall be null and void for this Beneficiary.
6. VESTING PERIOD
6.1. Principle
(a) The Restricted Stock Units granted under the 2015 Performance Based Plan shall vest in the Beneficiaries at the end of the Vesting Period, provided that the following condition(s) precedent(s) is (are) met:
i. except as set forth in Article 6.1(b), continued presence of the Beneficiary in his or her capacity as employee and/or corporate officer of the Company or of any of the companies of the Group during the Vesting Period, in the absence of which he or she will not be entitled to acquire Ordinary Shares on the date when this condition is no longer met; and
ii. attainment of one or more Performance Targets determined by the Board of Directors at grant in accordance with Article 6.2 and reflected in the relevant Grant Letter.
Should the Beneficiary be at the same time an employee and an officer of the same company or of two companies of the Group, the loss of one of these capacities shall not result in the loss of the right to vest in the Restricted Stock Units granted under the Performance Based Plan at the end of the Vesting Period; provided, that if the Beneficiary is an officer on the Grant Date and subsequently ceases to be an officer of any company of the Group, the Board of Directors shall have the discretion to terminate the Beneficiary’s Restricted Stock Units granted under the Performance Based Plan at any time up to the end of the Vesting Period.
Pursuant to Article L. 225-197-3 of the French Commercial Code, the Beneficiaries hold a claim against the Company which is personal and may not be transferred until the end of the Vesting Period.
During the Vesting Period, the Beneficiaries will not own the Ordinary Shares and will not be shareholders of the Company. As a consequence, they will not hold any rights attached to the Ordinary Shares.
(b) Unless otherwise determined by the Board of Directors at the Grant Date, if the Beneficiary (i) ceases to be an employee or officer of the Group more than one year after the Grant Date but prior to (A) the Vesting Date or (B) in the case of a Grant that vests in tranches, the vesting date of the first tranche of the Grant (such date in either (A) or (B), the “First Vesting Date”), and (ii) prior to the termination of his or her employment or term of office, any applicable Performance Targets (as defined below) are fully satisfied, then the Beneficiary shall vest in, on the First Vesting Date, only those Restricted Stock Units that correspond to the Performance Targets that were fully satisfied prior to the termination of his or her employment or term of office (rounded to the nearest whole number). For instance, for a Grant where 25% of the Restricted Stock Units vest upon the second anniversary of the Grant Date subject to the attainment of Performance Target No. 1 and 25% of the Restricted Stock Units vest upon the second anniversary of the Grant Date subject to the attainment of Performance Target No. 2, if the Beneficiary ceases to be an employee or officer of the Group on the day following the first anniversary of the Grant Date and the Board determines that, by that date, the Beneficiary has satisfied Performance Target No. 1 at 100% and Performance Target No. 2 at 85%, he shall vest in on such second anniversary date 25% of his Restricted Stock Units, with the balance being automatically forfeited. If none of the Performance Targets are
met at the 100% level or higher prior to the Beneficiary’s termination, the Beneficiary’s entire Grant will be automatically forfeited.
For the avoidance of doubt, this Article 6.1(b) shall apply only for Grants where the First Vesting Date is more than one year after the Grant Date.
(c) In addition to any other powers set forth in the Performance Based Plan and subject to the provisions of the Performance Based Plan, the Board of Directors shall have the full and final power and authority, in its discretion, to determine the terms, conditions and restrictions applicable to each Grant (which need not be identical) and any Restricted Stock Units acquired pursuant thereto, including, without limitation, the Performance Measures (as defined below), performance period, performance award formula and Performance Targets (as defined below) applicable to any grant and the extent to which such Performance Targets have been attained. Further, the Board of Directors shall have the full and final power and authority, in its discretion, to determine whether, to what extent, and under what circumstances a Grant may be settled, cancelled, forfeited, exchanged, or surrendered.
Notwithstanding Articles 6.6, 6.7 and 6.8 of the Performance Based Plan, the Board of Directors shall not accelerate or shorten the minimum Vesting Period of one year. For clarity, there shall be no automatic acceleration of vesting with respect to a Grant under the Performance Plan solely based on a Change in Control.
6.2 Performance criteria
The vesting of any Restricted Stock Units granted hereunder shall be subject to or conditioned upon, in whole or in part, the achievement of Performance Targets in accordance with the following terms and conditions (each, a “Performance Grant”):
6.2.1 Establishment of performance period, performance targets and performance award formula
In granting each Performance Grant, the Board of Directors shall establish in writing the applicable performance period, performance award formula and one or more Performance Targets (as defined herein) which, when measured at the end of the performance period, shall determine, on the basis of the performance award formula, the final number of Restricted Stock Units acquired by the Beneficiary. The Board of Directors shall have full power and final authority, in its discretion, to alter or cancel the Performance Targets or performance award formula applicable to a Beneficiary, including, without limitation, in the event that the Beneficiary changes roles or functions within the Group during the performance period. In any case, the performance period shall not be shorter than one year.
6.2.2 Measurement of performance targets
Performance shall be evaluated by the Board of Directors on the basis of targets to be attained (“Performance Targets”) with respect to one or more measures of business or financial performance (each, a “Performance Measure”), subject to the following:
(a) Performance Measures
(i) Determination of Performance Measures. Except as otherwise determined by the Board of Directors and in each case to the extent applicable, Performance Measures shall have the same meanings as used in the Company’s financial statements, or, if such terms are not used in the Company’s financial statements, they shall have the meaning applied pursuant to generally accepted accounting principles or as used generally in the Company’s industry.
(ii) Calculation of Performance Measures. Except as otherwise determined by the Board of Directors, the Performance Measures applicable to the vesting of the Restricted Stock Units shall be calculated in accordance with generally accepted accounting principles and excluding the effect (whether positive or negative) of any change in accounting standards or any extraordinary, unusual or nonrecurring item, as determined by the Board of Directors, occurring after the establishment of the Performance Targets applicable to the vesting of the Restricted Stock Units. Each such adjustment, if any, shall be made solely for the purpose of providing a consistent basis from period to period for the calculation of Performance Measures in order to prevent the dilution or enlargement of the Beneficiary’s rights with respect to the vesting of the Restricted Stock Units.
(iii) Types of Performance Measures. Performance Measures may be one or more of the following or such other measures as determined by the Board of Directors:
(1) revenue excluding traffic acquisition costs;
(2) adjusted earnings before interest, taxes, depreciation and amortization, as defined by the Company in its financial statements as filed with the Securities Exchange Commission in the United States;
(3) cash flow from operating activities;
(4) stock price;
(5) completion of identified special project(s); or
(6) any combination of the foregoing.
Notwithstanding the foregoing, the Board of Directors may provide that one or more objectively determinable adjustments shall be made to the Performance Measures, which may include adjustments that would cause the measures to be considered “non-GAAP financial measures” under rules promulgated by the Securities and Exchange Commission.
(b) Performance Targets. Where applicable, Performance Targets may, without limitation, be expressed in terms of attaining a specified level of the Performance Measure or the attainment of a percentage increase or decrease in the particular Performance Measure, and may be applied to one or more of the Company, any subsidiary or affiliate of the Company, or a division or strategic business unit of the Company or any subsidiary or affiliate thereof, or may be applied to the performance of the Company or any subsidiary or affiliate thereof relative to a market index, a group of other companies or a combination thereof, all as determined by the Board of Directors. The Performance Targets may be subject to a threshold level of performance below which no Restricted Stock Units will vest, levels of performance at which specified numbers of Restricted Stock Units will vest, and a maximum level of performance above which no additional number of Restricted Stock Units will vest (or at which full vesting will occur).
6.3 Compliance with Company Policies
a) Grant Subject to Clawback Policy. The Grant Letter shall contain an acknowledgement and agreement by the Beneficiary that any Grant pursuant to the Performance Based Plan shall be subject to any applicable clawback policy of the Company, as adopted by the Company from time to time, as well as to any clawback required by any applicable laws, regulations or trading rules of any exchange on which the Company’s shares are listed at such time.
b) Share Ownership Guidelines. Any Ordinary Shares acquired pursuant to the vesting of Restricted Stock Units may need to be retained by the Beneficiary in order to comply with the Company’s Share Ownership Guidelines, to the extent applicable to the Beneficiary.
6.4 Internal mobility
In the event of transfer or temporary assignment of the Beneficiary within a company of the Group, implying (i) the termination of the initial employment agreement and the entering into of a new employment agreement or of a position as officer, and/or (ii) a resignation of the Beneficiary from his or her position as officer and the acceptance of a new position of officer or the entering into of a new employment agreement in one of such companies, the Beneficiary shall retain his or her right to vest in the Restricted Stock Units at the end of the Vesting Period.
6.5 Agreed Leave of Absence Exceeding Three Months
In the event a Beneficiary is on an Agreed Leave, such Beneficiary’s Grant(s) shall (a) stop vesting on the first day of the quarter immediately following the quarter during which the Agreed Leave begins; and (b) resume vesting on the first day of the quarter immediately following the quarter in which the Agreed Leave ends. As a result of any Agreed Leave, the Vesting Period for the applicable Grant(s) shall be extended in accordance with this Article 6.5.
6.6 Disability
In the event of Disability before the end of the Vesting Period, the Restricted Stock Units shall vest in the Beneficiary on the date of Disability in accordance with articles 6.1 and 6.2 and reflected in the Grant Letter, but being noted that (i) the condition related to the continued presence of the Beneficiary in his or her capacity as employee and/or corporate officer of the Company or of any of the companies of the Group during the Vesting Period will be considered as met immediately on the date of Disability and (ii) the condition of the attainment of one or more Performance Targets determined by the Board of Directors at grant will be measured on the date of Disability.
6.7 Death
In the event of the death of the Beneficiary during the Vesting Period, the Restricted Stock Units shall vest in accordance with articles 6.1 and 6.2 and reflected in the Grant Letter, but being noted that (i) the condition related to the continued presence of the Beneficiary in his or her capacity as employee and/or corporate officer of the Company or of any of the companies of the Group during the Vesting Period will be considered as met immediately on the date of death and (ii) the condition of the attainment of one or more Performance Targets determined by the Board of Directors at grant will be measured on the date of death.
The Restricted Stock Units shall vest at the date of the request made by his or her beneficiaries in the framework of the inheritance. The request for the vesting of the Restricted Stock Units by the heirs shall be made within six months from the date of death in compliance with Article L. 225-197-3 of the French Commercial Code.
6.8 Retirement
In the event of the retirement of a Beneficiary during the Vesting Period, and notwithstanding the number of Restricted Stock Units that may vest pursuant to Article 6.1(b) upon retirement of such Beneficiary, the Board of Directors of the Company may decide that the conditions set forth in Article 6.1 above shall be deemed to be met for all or part of the Restricted Stock Units prior to the date of such retirement.
6.9 Change in Control
(a) Unless otherwise provided by the Board of Directors, an agreement between a Group company and the Beneficiary or in the applicable Grant Letter, in the event of a Change in Control:
(i) Where the successor corporation or parent or subsidiary of the successor corporation does not agree to assume or substitute for any outstanding Grant, for each Grant that is not assumed or substituted for and for which the Grant Date is at least one year prior to the consummation of the Change in
Control, the restrictions and forfeiture conditions applicable to the Vesting Period shall lapse, any performance conditions imposed with respect to such Grant shall be deemed to be achieved at target performance levels and the Restricted Stock Units shall be deemed fully vested by the Beneficiary prior to the consummation of the Change in Control. Any Grant for which the Grant Date is less than one year prior to the consummation of the Change in Control shall either be assumed or substituted for in accordance with Article 6.9(a)(ii) or cancelled in accordance with Article 6.9(a)(iii) below.
(ii) For the purposes of this Article 6.9, a Grant will be considered assumed or substituted if, (A) following the Change in Control, the Grant confers the right to receive, for each Restricted Stock Unit subject to the Grant immediately prior to the Change in Control, the consideration (whether stock, cash, or other securities or property) or the fair market value, as determined by the Board of Directors in good faith, of the consideration received in the Change in Control by holders of Ordinary Shares for each such share held on the effective date of the transaction; provided, however, that if such consideration received in the Change in Control is not solely common stock of the successor corporation or its parent, the Board of Directors may, with the consent of the successor corporation, provide that the consideration to be received for each Restricted Stock Unit shall be solely common stock of the successor corporation or its parent equal in fair market value, as determined by the Board of Directors in good faith, to the per share consideration received by holders of Ordinary Shares in the Change in Control; (B) any securities of the successor corporation or its parent forming part of the Grant following the Change in Control are freely tradable on a major stock exchange; and (C) the Grant otherwise remains subject to the same terms and conditions that were applicable to the Grant immediately prior to the Change in Control.
(iii) Notwithstanding any other provision of the 2015 Performance Plan, in the event of a Change in Control, except as would otherwise result in adverse tax consequences under Section 409A of the U.S. Internal Revenue Code, the Board of Directors may, in its discretion, provide that each Grant shall, immediately upon the occurrence of a Change in Control, be cancelled in exchange for a payment in cash or securities in an amount equal to (i) the consideration paid per Ordinary Share in the Change in Control multiplied by (ii) the number of Restricted Stock Units granted. The Board of Directors shall not be required to treat all Grants similarly for purposes of this Article 6.9(a). Payment of amounts under this Article 6.9(a) shall be made in such form, on such terms and subject to such conditions as the Board of Directors determines in its discretion, which may or may not be the same as the form, terms and conditions applicable to payments to the Company's shareholders in connection with the Change in Control and may, in the Board of Directors’ discretion, include subjecting such payments to vesting conditions comparable to the Grants surrendered, subjecting such payments to escrow or holdback provisions comparable to those imposed upon the Company's shareholders in connection with the Change in Control, or calculating and paying the present value of payments that would otherwise be subject to escrow or holdback terms.
(b) The obligations of the Company under the Performance Based Plan shall be binding upon any successor corporation or organization resulting from the Change in Control.
7. HOLDING PERIOD
7.1 Principle
a) During the Holding Period, if any, the Beneficiaries concerned will be the owner of the Ordinary Shares underlying the Restricted Stock Units granted under the Performance Based Plan and will be shareholders of the Company. As a consequence, they will benefit from all the rights attached to the capacity of shareholder of the Company.
However, the Ordinary Shares underlying the Restricted Stock Units shall not be transferable during the Holding Period, if any, and the Beneficiaries may not transfer or pledge those shares, by any means, or convert them into bearer form.
b) At the end of the Holding Period, if any, the Restricted Stock Units will be fully transferable, subject to the provisions of the following paragraph.
At the end of the Holding Period, if any, the Ordinary Shares acquired pursuant to the vesting of the Restricted Stock Units granted under the Performance Based Plan may not be transferred (i) if a “black-out” period is in effect pursuant to the Company’s Insider Trading Policy, as in effect at such time, or (ii) otherwise in contravention of any applicable laws or regulations, or trading rules or restrictions of any exchange on which the Company’s shares are listed at such time.
7.2 Specific situations
Notwithstanding the provisions of the second paragraph of Article 7.1 above, the Ordinary Shares underlying the Restricted Stock Units delivered to the Beneficiaries referred to in Article 6.5 above or to the beneficiaries of the deceased Beneficiary referred to in Article 6.6 above may be freely transferred as from the date of their date of vesting.
8. CHARACTERISTICS OF THE ORDINARY SHARES
The Ordinary Shares delivered pursuant to the vesting of the Restricted Stock Units shall be, at the Company’s choice, new shares to be issued by the Company or existing shares acquired by the Company.
As from the Vesting Date, the Ordinary Shares delivered pursuant to the vesting of the Restricted Stock Units shall be subject to all the provisions of the Bylaws. They shall be assimilated to existing Ordinary Shares and shall benefit from the same rights as from the Vesting Date.
Restricted Stock Units that do not vest do not give right to any dividend paid or dividend equivalent accumulated prior to the Vesting Date.
9. DELIVERY AND HOLDING OF THE ORDINARY SHARES UNDERLYING THE RESTRICTED STOCK UNITS
At the end of the Vesting Period, the Company shall deliver to the Beneficiary the Ordinary Shares underlying the Restricted Stock Units vested under the Performance Based Plan provided that the conditions and criteria for such vesting provided by Articles 5 and 6 above are met. However, Ordinary Shares may not be delivered in fractional shares. Unless otherwise provided in an award agreement or grant letter, the number of Ordinary Shares delivered at the end of any Vesting Period will always be rounded to the nearest whole number, provided however that the
rounding does not result in the issuance of Ordinary Shares in excess of the total number of Ordinary Shares subject to the Grant.
If the Vesting Date is not a Working Day, the delivery of the Ordinary Shares underlying the Restricted Stock Units shall be completed the first Working Day following the end of the Vesting Period.
The Ordinary Shares that may be acquired under the Performance Based Plan will be held, during the Holding Period (if any), in nominative form (nominatif pur) in an individual account opened in the name of the relevant Beneficiary at BNPP Securities Services with a legend stating that they cannot be transferred. If the provisions of Article 7.1(b) above are applicable at the end of the Holding Period (or the end of the Vesting Period if there is no Holding Period), the Restricted Stock Units shall remain in nominative form (nominatif pur) at BNPP Securities Services until such time as they are transferred to make sure that the restrictions set forth in Article 7.1(b) above are complied with.
In the event that, as a consequence of the Grant of Restricted Stock Units under the Performance Based Plan, the Company or any of the companies of the Group shall be compelled to pay taxes, social costs or any other social security taxes or contributions on behalf of the Beneficiary, the Company retains the right to postpone or to forbid the delivery of the Ordinary Shares underlying the Restricted Stock Units on the Vesting Date until the relevant Beneficiary has paid to the Company or to the relevant company of the Group the amount corresponding to these taxes, social costs, or social security taxes or contributions.
10. SHARES SUBJECT TO PLAN; INDIVIDUAL LIMITATIONS
10.1 Shares Available
Subject to adjustment as provided in Articles 11 and 12, the maximum aggregate number of Ordinary Shares underlying the Restricted Stock Units that may be delivered under the Performance Based Plan shall not exceed the number of shares remaining available for issuance or transfer under the Company’s equity compensation plans pursuant to authorizations previously approved by the shareholders of the Company, as of the Grant Date, that are not subject to outstanding awards thereunder. Any Restricted Stock Units granted in connection with a Grant under the Performance Based Plan (i.e., grants other than options or warrants) shall be counted against this limit as 1.57 shares for every one Ordinary Share underlying the Restricted Stock Unit granted in connection with such Grant. Shares subject to the Performance Based Plan shall consist of authorized but unissued Ordinary Shares, as well as existing Ordinary Shares.
In the event that a Grant, or any part thereof, for any reason is terminated or canceled without having vested, the unvested and forfeited portion of the Restricted Stock Units relating to such Grant shall, provided the 2015 Performance Based Plan is still in force, again be available for future grant pursuant to the Time-Based Restricted Stock Units Plan or the Performance Based Plan. Notwithstanding any provision of the Performance Based Plan or the Appendix thereunder to the contrary, shares withheld or reacquired by the Company in satisfaction of tax withholding obligations with respect to a Beneficiary shall not again be available for issuance or transfer under the Performance Based Plan.
10.2 Individual Grant Limits
Unless otherwise determined by the Board of Directors, the following limits shall apply to the grant of a Grant under the Performance Based Plan. Subject to adjustment as provided in Articles 11 and 12, no Beneficiary shall be granted within any fiscal year of the Company a Grant of Restricted Stock Units under the Performance Based Plan, the grant or vesting of which is based on the attainment of Performance Targets, for more than 1,000,000 Restricted Stock Units.
11. INTERMEDIARY OPERATIONS
Subject to Article 6.9, in the event of exchange of shares without any payment in cash (soulte) resulting from a merger or split-up completed during the Vesting Period or the Holding Period (if any), the remainder of such period(s) shall apply to the rights to receive Ordinary Shares underlying Restricted Stock Units of the Company or shares of the surviving entity received by the Beneficiary in exchange for his rights to receive Ordinary Shares underlying Restricted Stock Units.
The same shall apply in the event of exchange resulting from a public tender offer, a stock split or reverse stock split completed in compliance with applicable regulations during the Holding Period (if any).
12. ADJUSTMENT
Should the Company, during the Vesting Period, undergo an amortization, reduce its share capital, change the allocation of its profits, allocate Ordinary Shares to all the shareholders, capitalize reserves, profits or issuance premiums, allocate reserves or issue equity securities or give a right to the allocation of equity securities, including a preferential subscription right reserved to the shareholders or any other corporate transaction or event having an effect similar to any of the foregoing, the maximum number of Ordinary Shares underlying the Restricted Stock Units granted under the Performance Based Plan may be adjusted in order to take into account said operation by application, mutatis mutandis, of the terms of adjustment provided by the law for the beneficiaries of stock options as per Article L. 225-181 and L. 228-99 of the French commercial code.
Each Beneficiary shall be informed of the practical terms of the adjustment and of its consequences on the Grant of Restricted Stock Units he or she benefited from, it being specified that the shares of the Company granted pursuant to this adjustment shall be governed by the Performance Based Plan.
13. AMENDMENT TO THE 2015 PERFORMANCE PLAN
13.1 Principle
The Performance Based Plan may be amended by the Board of Directors, provided that any such amendment shall be subject to shareholder approval to the extent required in order to comply with applicable law or the rules of the Nasdaq Stock Market. Any such amendment shall be subject to the written consent of the Beneficiaries if it results in a decrease in the rights of said Beneficiaries, unless such amendment is necessary or appropriate to comply with or facilitate compliance with applicable laws or other rules, regulations or requirements, as determined by the Board of Directors (or its delegate).
The new provisions shall apply to the Beneficiaries of the Restricted Stock Units during the Vesting Period on the date of the decision to amend the Performance Based Plan made by the Board of Directors, or the written consent of the Beneficiary, if required.
13.2 Notice of the amendments
The affected Beneficiaries shall be notified of an amendment to the Performance Based Plan, by any reasonable means, including by electronic delivery, internal mail, by simple letter or, with acknowledgement of receipt, by fax or by e-mail.
14. TAX AND SOCIAL RULES
The Beneficiary shall bear all taxes and mandatory costs which he or she must bear pursuant to the applicable law in relation to the grant of Restricted Stock Units, on the due date of said taxes or costs.
Each Beneficiary shall verify and carry out, as the case may be, the reporting obligations he or she must comply with in relation to the grant of the Restricted Stock Units.
15. MISCELLANEOUS
15.1 Rights in relation to the capacity of employee
No provisions of the Performance Based Plan shall be construed as granting to the Beneficiary a right to have his or her employment agreement with the Company or any of the companies of the Group maintained, or limiting the right of the Company or any of the companies of the Group to terminate or amend the terms and conditions of the employment agreement of the Beneficiary.
15.2 Rights in relation to future Restricted Stock Units plans and Nature of Grant
Rights in relation to future Restricted Stock Units plans. The fact that a person may benefit from the Performance Plan does not imply that he or she shall benefit from any other plan that may be implemented thereafter.
Nature of Grant. In accepting any Grant under the Performance Based Plan, the Beneficiary acknowledges that:
(a) the Performance Based Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Performance Based Plan;
(b) the grant of the Restricted Stock Units is voluntary and occasional and does not create any contractual or other right to receive future grants of Restricted Stock Units, or benefits in lieu of Restricted Stock Units , even if Restricted Stock Units have been granted repeatedly in the past;
(c) all decisions with respect to future grants, if any, will be at the sole discretion of the Company;
(d) Beneficiary’s participation in the Performance Based Plan shall not create a right to further employment with the Employer and shall not interfere with the ability of the Employer to terminate Beneficiary’s employment relationship at any time with or without cause unless otherwise required under local law;
(e) Beneficiary is voluntarily participating in the Performance Based Plan;
(f) the Restricted Stock Units are an extraordinary item that do not constitute compensation of any kind for services of any kind rendered to the Company or the Employer, and which is outside the scope of Beneficiary’s employment contract, if any;
(g) the Restricted Stock Units are not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long service awards, pension or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company or the Employer;
(h) in the event that Beneficiary is not an employee of the Company, the grant will not be interpreted to form an employment agreement or relationship with the Company; and furthermore, the grant will not be interpreted to form an employment agreement with the Employer or any subsidiary or affiliate of the Company;
(i) the future value of the underlying Ordinary Shares is unknown and cannot be predicted with certainty;
(j) if the Beneficiary obtains Ordinary Shares, the value of those Ordinary Shares may increase or decrease;
(k) in consideration of the grant, no claim or entitlement to compensation or damages shall arise from termination of the award of Restricted Stock Units or diminution in value of the award resulting from termination of the Beneficiary’s employment with the Company or the Employer (for any reason whatsoever) and the Beneficiary irrevocably releases the Company and the Employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing the Performance Based Plan, the Beneficiary shall be deemed irrevocably to have waived the Beneficiary’s entitlement to pursue such claim; and
(l) unless otherwise decided by the Board of Directors, in the event of termination of Beneficiary’s employment during the Vesting Period, Beneficiary’s right to vest in the Restricted Stock Units under the Performance Based Plan, if any, will terminate effective as of the date that Beneficiary is no longer actively employed and will not be extended by any notice period mandated under the local law (e.g., active employment would not include a period of “garden leave” or similar period pursuant to local law).
15.3 Applicable law - Jurisdiction
The Performance Based Plan is subject to French law. Any dispute relating to its validity, its interpretation or its performance shall be decided by the competent courts of the French Republic.
15.4 Provisions Applicable to Beneficiaries Located outside of France
The attached Appendix applies to Beneficiaries located outside of France at the time of a relevant taxable event.
16. Data Privacy
As part of the Performance Based Plan, the Company processes some personal data of the Beneficiary. For this processing, the Company acts as the controller of this personal data and in accordance with the provisions of Regulation (EU) 2016/679 and, where applicable, those of Act No. 78-17 known as "Information technology & Civil Liberties", as amended, together the "Personal Data Regulation". Undefined terms used in this clause have the meaning given to them pursuant to the Personal Data Regulation.
The Company processes the Beneficiary's personal data on the legal basis of the conclusion and performance of the contract concluded at the time of the Beneficiary's acceptance of the Grant Letter. The purpose of the contract is to implement, administer and manage the Beneficiary's participation in the Performance Based Plan. Processed personal data are those strictly necessary for the aforementioned purposes. Especially, this includes the following information: the Beneficiary's name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares or directorships held in the Company, details of all awards or any other entitlement Shares awarded, cancelled, exercised, vested, unvested or outstanding in Beneficiary's favor (the "Data"). Failure by the Beneficiary to provide certain Data could compromise the conclusion and performance of the contract concluded at the time of the Beneficiary's acceptance of the Grant Letter.
The Company may disclose the Data to the Employer, subsidiaries and affiliated companies, sub-contractors, banking and financial organizations, on a need-to-know basis. These entities may be located outside the European Union and in countries that have not been subject of an adequacy decision. If the recipients are located in other countries that do not provide an adequate level of protection for personal data, the Company will take all necessary measures and guarantees to ensure such a level and to supervise such transfers of Data in accordance with the Personal Data Regulation, in particular by implementing standard contractual clauses of the European Commission. The Beneficiary may request a copy of these guarantees by writing to the Data Protection Officer at the following address: dpo@criteo.com.
In accordance with the Personal Data Regulation, where applicable, the Beneficiary has the right to access, rectify, delete, limit processing and transfer his Data. To exercise these rights, the Beneficiary may contact the Data Protection Officer at dpo@criteo.com. The Beneficiary also has the right to file a complaint with the competent supervisory authority and to communicate to the Company instructions for the storage, deletion and communication of its Data after its death.
In the context of this processing, the Data will not be kept for longer than necessary for the purposes referred to in this clause. In any event, the Company will comply with the retention periods imposed by law.
17. Electronic Delivery
The Company may, in its sole discretion, decide to deliver any documents related to the 2015 Performance-Based Restricted Stock Units Plan or future awards that may be granted under the 2015 Performance-Based Restricted Stock Units Plan by electronic means or to request Beneficiary’s consent to participate in the 2015 Performance-Based Restricted Stock Units Plan by electronic means. Beneficiary hereby consents to receive such documents by electronic delivery and, if requested, to agree to participate in the 2015 Performance -Based Restricted Stock Units Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
18. Severability
The provisions of this Performance Based Plan are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
APPENDIX
TERMS AND CONDITIONS
This Appendix contains additional terms and conditions that will apply to the Beneficiary if he or she resides outside of France. Capitalized terms used but not defined herein shall have the same meanings assigned to them in the 2015 Performance Based Restricted Stock Units Plan (the "Plan").
NOTIFICATIONS
This Appendix also includes information regarding exchange control and certain other issues of which the Beneficiary should be aware with respect to his or her participation in the Performance Based Plan. The information is based on the securities, exchange control and other laws in effect in the respective countries as of July 2015. Such laws are often complex and change frequently. The Company therefore strongly recommends that the Beneficiary not rely on the information in this Appendix as the only source of information relating to the consequences of his or her participation in the Plan because such information may be outdated when the Beneficiary vests in the Restricted Stock Units and/or sells any Ordinary Shares delivered pursuant to the award.
GENERAL PROVISIONS
Taxes. Regardless of any action the Company or the Beneficiaries’ employer (the “Employer”) takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax-Related Items”), the Beneficiary acknowledges that the ultimate liability for all Tax-Related Items legally due by the Beneficiary is and remains the Beneficiary’s responsibility and that the Company and/or the Employer (1) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Restricted Stock Units grant, including the grant, vesting of the Restricted Stock Units, the subsequent sale of shares acquired pursuant to such vesting and the receipt of any dividends; and (2) do not commit to structure the terms of the grant or any aspect of the Restricted Stock Units to reduce or eliminate the Beneficiary’s liability for Tax-Related Items.
Prior to vesting of the Restricted Stock Units, the Beneficiary will pay or make adequate arrangements satisfactory to the Company and/or the Employer to satisfy all withholding obligations of the Company and/or the Employer, if any. In this regard, the Beneficiary authorizes the Company and/or the Employer to withhold all applicable Tax-Related Items legally payable by the Beneficiary from the Beneficiary’s compensation paid to the Beneficiary by the Company and/or Employer or from proceeds of the sale of shares underlying the Restricted Stock Units. Alternatively, or in addition, if permissible under local law, the Company may, (1) sell or arrange for the sale of shares underlying the vested Restricted Stock Units to meet the withholding obligation for Tax-Related Items and/or (2) withhold in shares, provided that, to the extent required under applicable accounting or tax rules, the Company only withholds the amount of shares necessary to satisfy the withholding amount and further provided that any such withholding of shares shall be subject to advance approval by the Board of Directors or a committee thereof as constituted in accordance with Rule 16b-3 under the Exchange Act.. Finally, the Beneficiary will pay to the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold as a result of the Beneficiary’s participation in the Plan or the Beneficiary’s vesting of Restricted Stock Units that cannot be satisfied by the means previously described. The Company may refuse to honor the vesting and refuse to deliver the shares underlying the vested Restricted Stock Units if the Beneficiary fails to comply with Beneficiary’s obligations in connection with the Tax-Related Items as described in this section.
For tax residents of the United States
Beneficiary acknowledges that both this award and any underlying Ordinary Shares are securities, the issuance or transfer of which by the Company requires compliance with federal and state securities laws.
Beneficiary acknowledges that these securities are made available to Beneficiary only on the condition that Beneficiary makes the representations contained in this section to the Company.
Beneficiary has made a reasonable investigation of the affairs of the Company sufficient to be well informed as to the rights and the value of these securities.
The intent of the parties is that payments and benefits under the Plan comply with, or be exempt from, Section 409A of the Internal Revenue Code of 1986, as amended (the "Code") to the extent subject thereto, and, accordingly, to the maximum extent permitted, the Plan and the Grant Letters thereunder shall be interpreted and be administered to be in compliance therewith or exempt therefrom. Notwithstanding anything contained herein to the contrary, to the extent required to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, the Beneficiary shall not be considered to have separated from service with the Company for purposes of the Plan and no payment or benefit shall be due to the Beneficiary under the Plan and the Grant Letters thereunder on account of a separation from service until the Beneficiary would be considered to have incurred a “separation from service” from the Company within the meaning of Section 409A of the Code. Any payments or benefits (including vesting grants) described in the Plan and the Grant Letters thereunder that are due within the “short-term deferral period” as defined in Section 409A of the Code shall not be treated as deferred compensation unless applicable law requires otherwise. Notwithstanding anything to the contrary in the Plan and the Grant Letters thereunder, to the extent that any amounts are payable upon a separation from service and such payment would result in accelerated taxation and/or tax penalties under Section 409A of the Code due to the Beneficiary’s status as a “specified employee” within the meaning of Section 409A of the Code, such payment, under the Plan or any other agreement of the Company, shall be made on the first business day after the date that is six (6) months following such separation from service (or death, if earlier). Further notwithstanding anything to the contrary in the Plan, to the extent required under Section 409A of the Code to make payment of an award upon a Change in Control, the applicable transaction or event defined in Article 2 and described in Article 6.9 of the Plan must qualify as a “change in control event” within the meaning of Section 409A of the Code and the regulations promulgated thereunder, and if it does not, then unless otherwise specified in the applicable Grant Letter, any Restricted Stock Units definitively vested in by the Beneficiary upon a Change in Control shall be delivered on their originally specified Vesting Date, in accordance with Article 9 of the Plan (or death, if earlier).
For Beneficiaries who are United States taxpayers, notwithstanding anything to the contrary contained in Article 6.6 of the Plan, the shares underlying the Restricted Stock Units shall be delivered to the Beneficiary no later than 90 days following the date of the Beneficiary’s Disability; provided, that any such Disability will be within the meaning of Section 409A of the Code and the regulations promulgated thereunder, and if it is not, any Restricted Stock Units definitively vested by the Beneficiary upon Disability shall be delivered on their originally specified Vesting Date, in accordance with Article 9 of the Plan (or death, if earlier).
For Beneficiaries who are United States taxpayers, notwithstanding anything to the contrary contained in Article 6.7 of the Plan, the Restricted Stock Units shall be delivered no later than no later than 90 days following the date of the Beneficiary’s Disability death, but in any event no later than December 31st of the calendar year following the year of the Beneficiary’s death to the extent permitted by Section 409A of the Code.
The Company makes no representation that any or all of the payments described in the Plan and the Grant Letters thereunder will be exempt from or comply with Section 409A of the Code and makes no undertaking to preclude
Section 409A of the Code from applying to any such payment. The Grantee shall be solely responsible for the payment of any taxes and penalties incurred under Section 409A.
The Company makes no representation as to the tax status of the Plan to the Beneficiary who should seek his or her own tax advice.
For Israeli Tax Residents
Upon grant of Restricted Stock Units, if the award is made to an employee, director or officer of an Israeli resident member of the Group (the "Approved Israeli Participants"), and is intended to qualify for beneficial tax treatment pursuant to the trustee capital gains route of Section 102 of the Israeli Income Tax Ordinance [New Version 1961 ("Trustee 102 Awards" and "Ordinance") the following provisions shall apply. The designation of a Restricted Stock Unit as a Trustee 102 Award shall be determined by the Board of Directors or any committee thereof. Unless otherwise specifically determined, all Restricted Stock Units awards to Approved Israeli Participants are intended to be Trustee 102 Awards. The provisions below set out the terms and conditions applicable to Trustee 102 Awards granted to Approved Israeli Participants, as defined below, in order to satisfy Israeli tax requirements. If the terms are not met the Restricted Stock Units shall be subject to tax pursuant to the non-trustee route of Section 102 or Section 2 or 3(i) of the Ordinance.
Trustee 102 Awards and/or any Ordinary Shares allocated or issued upon the vesting of a Trustee 102 Award and/or other Ordinary Shares received following any realization of rights under the Plan, shall be allocated or issued to the trustee appointed by the Company and/or its Israeli subsidiary pursuant to the provisions of Section 102 of the Ordinance (the "102 Trustee") or controlled by the 102 Trustee, for the benefit of the Approved Israeli Participants, in accordance with the provisions of Section 102 of the Ordinance. In the event the requirements for Trustee 102 Awards are not met, the Trustee 102 Awards may be regarded as awards subject to tax pursuant to Section 102(c) of the Ordinance or as awards which are not subject to Section 102, all in accordance with the provisions of Section 102.
With respect to any Trustee 102 Award, subject to the provisions of Section 102, an Approved Israeli Participant shall not sell or release from trust any Ordinary Shares received upon the grant, vesting or exercise of a Trustee 102 Award and/or any Ordinary Shares received following any realization of rights, including, without limitation, stock dividends, under the Plan at least until the lapse of the period of time required under Section 102 or any shorter period of time determined by the ITA (the “102 Holding Period”). Notwithstanding the foregoing, if any such sale or release occurs during the 102 Holding Period, the sanctions under Section 102 shall apply to and shall be borne by such Approved Israeli Participant.
Notwithstanding anything to the contrary, the 102 Trustee shall not release or sell any Ordinary Shares allocated or issued upon the vesting of a Trustee 102 Award unless the Company, the Group and the 102 Trustee are satisfied that the full amounts of any Tax due have been paid or will be paid.
Upon receipt of any Trustee 102 Award, the Approved Israeli Participant will consent to the grant of such award under Section 102 and undertake to comply with the terms of Section 102 and the trust arrangement between the Company and the 102 Trustee.
Each Trustee 102 Award will be deemed granted on the Grant Date, provided that and subject to (i) the Approved Israeli Participant has signed all documents required by the Company or applicable law, and (ii) the Company has provided all applicable documents to the 102 Trustee in accordance with the guidelines published by the ITA such that if the guidelines are not met the 102 Award will be considered as granted under Section 102(c) of the Ordinance.
Notwithstanding any provision of the Plan, no Trustee 102 Award or any right with respect thereto, whether fully paid or not, shall be assignable, transferable or given as collateral, and no right with respect to any such award shall be given to any third party whatsoever, and during the lifetime of the Approved Israeli Participant, each and all of such Approved Israeli Participant’s rights with respect to an award shall belong only to the Approved Israeli Participant. Any such action made, directly or indirectly, for an immediate or future validation, shall be void. As long as Restricted Stock Units and/or Ordinary Shares issued or purchased hereunder are held by the 102 Trustee on behalf of the Approved Israeli Participant, all rights of the Approved Israeli Participant over the Restricted Stock Units and Ordinary Shares cannot be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution.
With regard to Trustee 102 Awards, the provisions of Section 102 and any approval issued by the ITA shall be deemed an integral part of the Plan and the Grant Letter. Any provision of Section 102 and/or said approval issued by the ITA, which must be complied with in order to receive and/or to maintain any tax treatment with respect to a Trustee 102 Award, which is not expressly specified herein, shall be considered binding upon the Company and the Approved Israeli Participants. Furthermore, if any provision of the Plan disqualifies Trustee 102 Awards from the beneficial tax treatment pursuant to Section 102, such provision shall not apply to the Trustee 102 Awards.
Any tax consequences arising from the grant, vesting or sale of any Trustee 102 Award or Ordinary Shares covered thereby or from any other event or act (of the Company, and/or the Group, and the 102 Trustee or the Approved Israeli Participant), hereunder, shall be borne solely by the Approved Israeli Participant. The Company and/or the Group, and/or the 102 Trustee shall withhold tax according to the requirements of applicable laws, rules, and regulations, including withholding taxes at source. Furthermore, the Approved Israeli Participant agrees to indemnify the Company and/or the Group and/or the 102 Trustee and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Approved Israeli Participant. The Company and/or, when applicable, the 102 Trustee shall not be required to release any Ordinary Shares to an Approved Israeli Participant until all required tax payments have been fully made.
Exhibit 1
Form of Grant Letter
[Beneficiary Name and Address]
[Date]
Letter delivered by electronic delivery
[Name of Beneficiary],
We have the pleasure to inform you that, pursuant to the authorization granted by the shareholders’ meeting held on [June 9, 2020], the board of directors of Criteo S.A. (the “Company”), during its meeting held on [ ] (the “Grant Date”), granted to you Restricted Stock Units of the Company, under the terms and conditions provided for in Articles L. 225-197-1 to L. 225-197-5 of the French Commercial Code and in the Amended and Restated 2015 Performance Based Restricted Stock Units (the “2015 Performance Plan”). Capitalized terms that are used but not defined herein shall have the meaning ascribed to such terms in the 2015 Performance Plan.
The Board granted to you [ ] ordinary shares of the Company (the “Shares”), with a par value of EUR 0.025 each (the “Grant”).
There is a period (the “Vesting Period”) at the end of which the Grant will become effective and final (i.e., the Shares will be delivered to you and be your property). The Shares may be acquired by you not earlier than [ ] unless you shall cease to be an employee or officer of the Criteo group for any reason whatsoever during the Vesting Period [(subject to the following paragraph)], and subject to the attainment of the following performance goals: [ ].
[In the event (i) you cease to be an employee or officer of the Criteo group more than one year after the Grant Date but prior to the First Vesting Date, and (ii) prior to the termination of your employment or term of office, any of the Performance Targets set forth above are fully satisfied, you shall acquire, on the First Vesting Date, only those Shares that correspond to the Performance Targets that were fully satisfied prior to the termination of your employment or term of office. All other Shares will be automatically forfeited.]
In the event of Disability before the end of the Vesting Period, the Restricted Stock Units shall vest on the date of Disability. In the event of death during the Vesting Period, the Restricted Stock Units shall vest at the date of the request made by your beneficiaries in the framework of the inheritance. The request for the vesting of the Shares shall be made within six (6) months from the date of death in compliance with Article L. 225-197-3 of the French Commercial Code.
Neither the Performance-Based Plan nor this letter shall confer upon the you any right to be retained in any position, as an employee, consultant or director of the Company. Further, nothing in the Performance-Based Plan or this letter shall be construed to limit the discretion of the Company to terminate your continuous service at any time, with or without cause.
By acknowledging this Grant, you hereby acknowledge and agree that any Grant pursuant to the 2015 Performance Plan shall be subject to any applicable Company clawback policy, as adopted by the Company from time to time, as well as to any clawback required by any applicable laws, regulations or trading rules of any exchange on which the Company’s shares are listed at such time.
[To be included for the employees of the Israeli subsidiary: The Restricted Stock Units are intended to be subject to tax pursuant to the trustee capital gains route of Section 102 of the Ordinance, subject to compliance with the requirements under Section 102 and any rules or regulations thereunder, including the execution of this Grant Letter and the required declarations. However, in the event the Restricted Stock Units do not meet the requirements of Section 102, such Restricted Stock Units and the underlying Ordinary Shares shall not qualify for the favorable tax treatment under the Capital Gains Route. The Company makes no representations or guarantees that the Restricted Stock Units will qualify for favorable tax treatment and will not be liable or responsible if favorable tax treatment is not available under Section 102. The Restricted Stock Units and the Ordinary Shares issued upon vesting and/or any additional rights, as detailed above, including without limitation any right to receive any dividends or any shares received as a result of an adjustment made under the Plan, that may be granted in connection with the Restricted Stock Units (the “Additional Rights”) shall be issued to or controlled by the 102 Trustee for your benefit under the provisions of the Capital Gains Route for at least the period stated in Section 102 or any other period of time determined by the Israel Tax Authority (“ITA”). In accordance with the requirements of Section 102 and the Capital Gains Route, you shall not sell nor transfer from the 102 Trustee the Ordinary Shares or Additional Rights until the end of the 102 Holding Period. Notwithstanding the above, if any such sale or transfer occurs before the end of the 102 Holding Period, the sanctions under Section 102 shall apply and shall be borne by you. The Company and/or member of the Group and/or the 102 Trustee shall withhold taxes according to the requirements under the applicable laws, the rules, and regulations, including withholding taxes at source. Furthermore, you hereby agree to indemnify the Company and/or any member of the Group and/or the 102 Trustee and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to you. The Company and/or any member of the Group and/or the 102 Trustee, to the extent permitted by law, shall have the right to deduct from any payment otherwise due to you, or from proceeds of the sale of any Ordinary Shares, an amount equal to any tax required by law to be withheld with respect to such Ordinary Shares. You will pay to the Company, any member of the Group or the 102 Trustee any amount of taxes that the Company and/or any member of the Group or the Trustee may be required to withhold with respect to any Ordinary Shares that cannot be satisfied by the means previously described. The Company may refuse to deliver any Ordinary Shares if you fail to comply with your obligations in connection with the taxes as described in this section. Any fees associated with any vesting, sale, transfer or any act in relation to the Restricted Stock units and the Ordinary Shares issued upon vesting, shall be borne by you. The 102 Trustee and/or the Company and/or any member of the Group shall be entitled to withhold or deduct such fees from payments otherwise due to/from the Company or any member of the Group or the 102 Trustee.
[Security Law Exemption. If required, the Company will obtain an exemption from the requirement to file a prospectus with respect to the Restricted Stock Units. If obtained copies of the Plan and Form S-8 registration statement for the Plan filed with the U.S. Securities and Exchange Commission will be available free of charge upon request from your local human resources department.]
[In addition to the acknowledgments noted above and in the Plan, you hereby understand, acknowledge, agree as follows: (i) you are familiar with the provisions of Section 102 of the Ordinance and the regulations and rules promulgated thereunder, including without limitations the provisions of the tax route applicable to your Restricted Stock Units and agree to comply with such provisions, as amended from time to time, provided that if such terms are not met, the specific tax route may not apply; (ii) you accept the provisions of the trust agreement signed between the Company and the 102 Trustee, and agree to be bound by its terms; (iii) you acknowledge that selling the Ordinary Shares or releasing the Ordinary Shares from the control of the 102 Trustee prior to the termination of the 102 Holding Period constitutes a violation of the terms of Section 102 and agree to bear the relevant sanctions; (iv) you authorize the Company to provide the plan administrator and the 102 Trustee with any information required for the purpose of administering the Plan including executing their obligations according to Section 102 of the Ordinance, the trust deed and the trust agreement, including without limitation information about your Restricted Stock Units, Ordinary Shares, income tax rates, salary bank account, contact details and identification number and acknowledge that the information might be shared with an administrator who is located outside of Israel, where the level of protection of personal data is different than in Israel.]
The detailed terms of this Grant are described in the Performance Based Plan, a copy of which is attached hereto. The 2015 Performance Plan is hereby incorporated by reference and made a part hereof, and the Restricted Stock Units granted herein shall be subject to all terms and conditions of the Performance Based Plan and this Grant Letter. In the event of any conflict between the provisions of this Grant Letter and the provisions of the Performance Based Plan, the provisions of the Performance Based Plan shall govern.
Thank you for sending us a copy of the Performance Based Plan to people.experience@criteo.com, duly initialed and signed, not later than [90 days from the date of the Grant Letter], failing which the above grant shall be null and void.
Yours sincerely,
CRITEO
SIGNATURE PAGE
Acknowledged by: _________________________________ Date: _________________
(Print Name)
__________________________________
(Sign Name)