UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
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Soliciting Material under §240.14a‑12
Criteo S.A.
(Name of Registrant as Specified In Its Charter)
 
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
 
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COMBINED SHAREHOLDERS’ MEETING - JUNE 25, 2020


Board Report

Dear Shareholders,
We are holding this combined shareholders' meeting to submit resolutions for your approval, which, under French corporate law, fall partly within the scope of an ordinary shareholders’ meeting and partly within the scope of an extraordinary shareholders’ meeting. The ordinary shareholders’ meeting and the extraordinary shareholders’ meeting, which we will hold concurrently on June 25, 2020, are together referred to throughout this document as the “shareholders’ meeting.”

Set forth below is the agenda for the shareholders’ meeting:


Agenda for the Ordinary Shareholders’ Meeting

1.
renewal of the term of office of Mr. Jean-Baptiste Rudelle as Director,

2.
renewal of the term of office of Mr. James Warner as Director,

3.
renewal of the term of office of Mr. Edmond Mesrobian as Director,

4.
renewal of the term of office of Ms. Marie Lalleman as Director,

5.
non-binding advisory vote to approve the compensation for the named executive officers of the Company,

6.
approval of the statutory financial statements for the fiscal year ended December 31, 2019,

7.
approval of the consolidated financial statements for the fiscal year ended December 31, 2019,

8.
approval of the allocation of profits for the fiscal year ended December 31, 2019,

9.
approval of an agreement referred to in Articles L. 225-38 et seq. of the French Commercial Code (Indemnification agreement entered into with Ms. Marie Lalleman),

10.
approval of an agreement referred to in Articles L. 225-38 et seq. of the French Commercial Code (Indemnification agreement entered into with Ms. Megan Clarken),

11.
approval of an agreement referred to in Articles L. 225-38 et seq. of the French Commercial Code (Consultancy agreement entered into with the company Rocabella),

12.
delegation of authority to the board of directors to execute a buyback of Company stock in accordance with Article L. 225-209-2 of the French Commercial Code,

Agenda for the Extraordinary Shareholders’ Meeting

13.
delegation of authority to the board of directors to reduce the Company’s share capital by cancelling shares as part of the authorization to the board of directors allowing the Company to buy back its own shares in accordance with the provisions of Article L. 225-209-2 of the French Commercial Code,

14.
authorization to be given to the board of directors to reduce the Company’s shares capital by cancelling shares acquired by the




Company in accordance with the provisions of Article L. 225-208 of the French Commercial Code,

15.
delegation of authority to the board of directors to reduce the share capital by way of a buyback of Company stock followed by the cancellation of the repurchased stock,

16.
authorization to be given to the board of directors to grant OSAs (options to subscribe for new Ordinary Shares) or OAAs (options to purchase Ordinary Shares) of the Company, pursuant to the provisions of Articles L. 225-177 et seq. of the French Commercial Code without shareholders' preferential subscription right,

17.
authorization to be given to the board of directors to grant time-based restricted stock units (“Time-Based RSUs”) to employees and corporate officers of the Company and employees of its subsidiaries pursuant to the provisions of Articles L.225-197-1 et seq. of the French Commercial Code, without shareholders' preferential subscription right,

18.
authorization to be given to the board of directors to grant performance-based restricted stock units ("Performance-Based RSUs") from time to time to employees and corporate officers of the Company and employees of its subsidiaries, pursuant to the provisions of Articles L.225-197-1 et seq. of the French Commercial Code, without shareholders' preferential subscription right,


19.
approval of the maximum number of shares that may be issued or acquired pursuant to the authorizations and delegations pursuant to items 16 to 18 above,

20.
delegation of authority to the board of directors to increase the Company’s share capital by issuing ordinary shares, or any securities giving access to the Company’s share capital, while preserving the shareholders’ preferential subscription rights,

21.
delegation of authority to the board of directors to increase the Company’s share capital by issuing ordinary shares, or any securities giving access to the Company’s share capital, through a public offering, without shareholders’ preferential subscription rights,

22.
delegation of authority to the board of directors to increase the Company’s share capital by issuing ordinary shares, or any securities giving access to the Company’s share capital, for the benefit of a category of persons meeting predetermined criteria (underwriters), without shareholders’ preferential subscription rights,

23.
delegation of authority to the board of directors to increase the number of securities to be issued as a result of a share capital increase with or without shareholders’ preferential subscription rights pursuant to items 20 to 22 above, and pursuant to the delegation adopted by the 24th resolution of the Shareholders’ Meeting held on May 16, 2019,

24.
delegation of authority to the board of directors to increase the Company’s share capital by way of issuing shares and securities giving access to the Company’s share capital for the benefit of members of a Company savings plan (plan d'épargne d’entreprise),

25.
approval of the overall limits on the amount of ordinary shares to be issued pursuant to items 20 to 22, 24 above and to item 27 below,

26.
delegation of authority to the board of directors to decide on any merger-absorption, split or partial asset contribution pursuant to the provisions of Article L. 236-9 II of the French Commercial Code,

27.
Delegation of authority to the board of directors to increase the Company’s share capital by way of issuing shares or securities giving access to the Company’s share capital in the scope of a merger-absorption decided by the board of directors pursuant to item 26 above,

28.
amendment of Article 12 of the by-laws “Board of directors’ meetings” to comply with the new legal provisions of the French Commercial Code to provide to the Board of directors the faculty to take certain decisions by written consultation,

29.
amendment of Article 13 of the by-laws “powers of the Board of directors” to comply with the new provisions of the “Loi Pacte” relating to the attribution of the board of directors,





30.
amendment of Article 19 of the by-laws “general shareholders’ meetings” to comply with the new legal provisions of the French Commercial Code relating to the methods of determination of the required majority for the adoption of resolutions by general shareholder’ meetings.






I.
DECISIONS FALLING WITHIN THE SCOPE OF THE ORDINARY SHAREHOLDERS’ MEETING
A.
RENEWAL OF THE TERM OF OFFICE FOR A DIRECTOR WHOSE TERM IS COMING TO AN END [RESOLUTIONS N°1 TO 4]
Composition of the board of directors
The board of directors of the Company is composed of seven members, six of whom are independent (Mr. James Warner (Lead Independent Director), Ms. Nathalie Balla, Mr. Edmond Mesrobian, Mr. Hubert de Pesquidoux, Ms. Rachel Picard, Ms. Marie Lalleman) and of Mr. Jean-Baptiste Rudelle, Chairman of the board of directors since the incorporation of the Company, and former Chief Executive Officer (directeur général) until November 25, 2019.
The independent members of the board of directors have been chosen based on their unique combination of skills, experiences and other attributes, which allows each of them to make valuable contributions to the board of directors. Three out of six of the independent directors are residents of the United States of America, and three out of six of the independent directors are European residents, so that today the board’s composition reflects the main geographical challenges of the Company. Their range of skills allows the members of the board of directors to benefit from quality expertise and good practices in terms of finance and administration, corporate governance and compensation. Since three out of seven directors are female, the board of directors ensures a balanced female and male representation, in accordance with Article L. 225-18-1 of the French Commercial Code.
Attendance rate
The board of directors and its committees meet at least four times a year. The board of directors met eleven times in the 2019 fiscal year (including five in-person meetings which are taken into account for the purpose of calculating the remuneration of board members). The committees also met on several occasions in the 2019 fiscal year. The attendance rate of each of the board members, both at the meetings of the board of directors and its committees, was greater than 80%.


Minimum meetings per annum
Actual meetings in 2019
2019 director attendance rate (for both board and Committee meetings)
4
11 (incl. 5 physical)
> 80%

Furthermore, the work undertaken by each of the directors between the meetings, in preparation or follow-up (including reviewing pre-read material and participating in telephone conferences and regular discussions between the directors and between the Company and the directors), allows for effective meetings, with prudent and well informed decision-making. Each of the directors brings indispensable skills to the board of directors that are essential in addressing the unique and specific challenges faced by the Company.

Renewal of the terms of office of Mr. Jean-Baptiste Rudelle, Mr. James Warner, Mr. Edmond Mesrobian and Ms. Marie Lalleman
The terms of office of Mr. Jean-Baptiste Rudelle, Mr. James Warner, Mr. Edmond Mesrobian and Ms. Marie Lalleman are coming to an end at the end of this shareholders’ meeting. Ms. Lalleman was appointed by the board of Directors effective April 2019 (as ratified by the Company’s shareholders at our 2019 Annual General Meeting) for the remainder of Ms. Sharon Fox Spielman’s two-year term in office, expiring in 2020. You are therefore asked to renew each of their terms of office for a period of two years, which will expire at the time of the ordinary annual shareholders’ meeting that will be called to approve the financial statements of the fiscal year ended December 31, 2021. We believe that:    
Mr. Jean-Baptiste Rudelle’s extensive knowledge of the Company as one of our founders and his industry experience with technology companies qualify him to serve on, and allow him to make valuable contributions to, the board of directors;

Mr. James Warner’s experience in the consumer and digital marketing and media industries qualifies him to serve on, and allows him to make valuable contributions to the board of directors;

Mr. Edmond Mesrobian’s extensive experience as an executive of companies in the technology industry, board of directors qualify him to serve on, and allow him to make valuable contributions to the board of directors;

Ms. Marie Lalleman’s experience in the consumer and digital marketing and media industries qualifies her to serve on, and allows her to make valuable contributions to, the board of directors.

B.
NON-BINDING ADVISORY VOTE TO APPROVE THE COMPENSATION FOR THE NAMED EXECUTIVE OFFICERS OF THE




COMPANY [RESOLUTION 5]
On June 29, 2016, you recommended that the board of directors hold a vote every year to approve, on a non-binding basis, the compensation paid by the Company to its named executive officers. For fiscal year 2019, our named executive officers were Mr. Jean-Baptiste Rudelle, our Chairman of the board of directors and former Chief Executive Officer (directeur général) until November 25, 2019, Ms. Megan Clarken, our Chief Executive Officer (directeur général) as from November 25, 2019, Mr. Benoit Fouilland, our Chief Financial Officer, Mr. Ryan Damon, our Executive Vice President, General Counsel & Corporate Secretary, Ms. Mary (“Mollie”) Spilman, our former Chief Operating Officer until July 5, 2019, and Mr. Dan Teodosiu, our former Chief Technology Officer until September 30, 2019.
The board of directors, through the Compensation Committee, makes sure that the remuneration of the Named Executive Officers be structured in a way (i) to attract and retain the most competitive executive teams with regards to the competitive sectors we operate in, (ii) reward the executive team for meeting or exceeding our operational, financial and strategic goals, (iii) align the long-term interests of such executive team with those of the shareholders, and (iv) provide our officers an overall remuneration which is reasonable and at the same time competitive with regards to the remuneration for equivalent positions in our business. Thus, the remuneration of the named executive officers is directly linked to the continuous improvements in the Company’s results and to the measures put in place that are expected to increase the value of the Company.
Consequently, you are asked, pursuant to the requirements of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules promulgated thereunder by the U.S. Securities and Exchange Commission, to approve, on a non-binding, advisory basis, the compensation paid by the Company to its named executive officers, as disclosed in the Company's Proxy Statement for the 2020 annual shareholders' meeting (the “Proxy Statement”). An excerpt of the Proxy Statement is appended to this report.

C.
APPROVAL OF THE STATUTORY AND CONSOLIDATED FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED DECEMBER 31, 2019 - ALLOCATION OF PROFITS [RESOLUTIONS 6 TO 8]
Every year, within six months following the end of the fiscal year, the Company’s shareholders must approve the statutory financial statements and the consolidated financial statements for the past fiscal year.
Pursuant to the sixth and seventh resolutions you are being asked to approve, respectively:
the statutory financial statements (also called individual or company financial statements) and the transactions set forth therein; and
the consolidated financial statements (IFRS) and the transactions set forth therein.
Pursuant to the eighth resolution, you are being asked to approve the allocation of the Company's profits of €135,833,395 for the fiscal year ended December 31, 2019 to the retained earnings account.

D.
EXAMINATION OF THE AGREEMENTS REFERRED TO IN ARTICLES L. 225-38 ET SEQ. OF THE FRENCH COMMERCIAL CODE [RESOLUTIONS 9 TO 11]
Pursuant to Article L. 225-38 of the French Commercial Code, the Company’s shareholders must approve or ratify any new related-person agreements entered into during the 2019 fiscal year.
As notified to the statutory auditors of the Company on January 22, 2020 by the Chairman of the board of directors, these agreements were approved by the board of directors prior to their execution and are consequently subject to the approval by the shareholders’ meeting in accordance with Article L.225-40 of the French Commercial Code.
The agreements listed below are submitted to your approval:
Indemnification Agreement” entered into with Ms. Marie Lalleman in her capacity of director of the Company, providing, subject to French laws and regulations, for (i) the indemnification of Ms. Marie Lalleman for damages suffered as a result of her functions, and (ii) the reimbursement of the expenses incurred in that respect.

Indemnification Agreement” entered into with Ms. Megan Clarken in her capacity of Chief Executive Officer of the Company, providing, subject to French laws and regulations, for (i) the indemnification of Ms. Megan Clarken for damages suffered as a result of her functions, and (ii) the reimbursement of the expenses incurred in that respect.

The template of the Indemnification agreements listed above has been included as Exhibit 10.16 to the Company’s Annual Report on Form 10-K, filed with the US Securities and Exchange Commission on March 2, 2020.

Consultancy agreement entered into between the Company and the company Rocabella, fully owned by Mr. Jean-Baptiste Rudelle and its immediate family members, pursuant to which, Rocabella shall provide corporate advisory and representation services to the Company before public and private organizations, institutions and regulators at both national and international scale.




Mr. Jean-Baptiste Rudelle, as founder of the Company and former Chief Executive Officer, has deep and unparalleled experience with regards to Criteo’s business and therefore can offer important and unique advisory services to both our board of directors and our executive team on various strategic and operational subjects, including regulatory affairs in Europe.

E.
BUYBACK OF THE COMPANY’S STOCK [RESOLUTION 12]
Pursuant to Resolution 12, you are asked to approve our ability to buy back shares of the Company’s stock, on the terms and subject to the conditions set forth herein, to use as acquisition consideration and/or to underly incentive instruments for the employees and officers of the Company and its subsidiaries.
We also ask you to approve the use of this authorization for any other purpose that would be permitted by law on the date of such use, in the event that the permitted purposes for share buyback programs are amended by law to bring them in line with the provisions of Article L. 225-209 of the French Commercial Code applicable to companies listed on an European market.
External growth, and particularly the acquisitions, whether tuck-in, bolt-on or mid-sized, that would allow the Company to strengthen its technology platform, its product portfolio or its team of key employees, particularly in Product and Research & Development, are important areas of development of the Company. Potential targets of strategic importance are mainly located in the highly competitive technology industry in the United States. While the Company will be very thoughtful about maximizing its financial liquidity, in particular in the context of the global economic turmoil triggered by the recent COVID-19 outbreak, in order to take advantage of potential opportunities, particularly given the intense competition in the advertising technology industry, we must be able to act swiftly and with the greatest financial flexibility possible, both in terms of our access to financial resources and our ability to structure consideration in a manner that is attractive to U.S. targets.
In addition, since equity-based incentives are a key component in the economics of the technology industry, the board of directors believes it is important to be able to use Company stock, among other means, as a potential component of acquisition consideration. Because we are not listed in the European Union and are therefore deemed a private company for French law purposes, our shareholders may not delegate their authority to the board of directors to issue new shares as consideration for potential acquisitions without the requirement to call a special shareholders’ meeting. However, our shareholders may delegate authority to our board of directors to repurchase outstanding shares in order to be able to use such shares as consideration for potential acquisitions, rather than issuing new shares. Unlike most companies incorporated under U.S. state law, which are generally able to repurchase their own shares without shareholder approval, as a French company, subject to limited exceptions only, our board of directors must have a specific delegation of authority in order to buy back our shares for limited pre-specified purposes, including to be used as consideration for potential future acquisitions.
In addition, equity-based compensation is an important tool for us to attract industry leaders of the highest caliber in the technology industry and to retain them for the long term, as well as to ensure employees’ interests are aligned with those of our shareholders.
Any share buybacks carried out pursuant to this authorization shall, at no time, exceed 10% of the share capital of the Company, provided that if the shares are allocated as payment or in exchange for assets acquired by the Company in connection with a potential acquisition, merger, demerger or contribution-in-kind transaction, the maximum number of shares that may be purchased for these purposes shall at no time exceed 5% of the share capital of the Company. Any share buybacks carried out pursuant to this authorization may only be carried out at a price per share set in accordance with the criteria approved at this shareholders’ meeting, which take into account the market value of the Company’s American Depositary Shares, each representing one ordinary share of the Company (“ADS”), as listed on the Nasdaq Stock Market. The minimum purchase price per share is $5.89, and the maximum purchase price per share is $22.75. This authorization will be valid for 12 months (i.e., until June 24, 2021) and implemented under the conditions set forth in Article L. 225-209-2 of the French Commercial Code.
Under French corporate law, this authorization may not be used during an unsolicited public tender offer initiated by a third party on the Company’s shares.
In support of this resolution, you will be provided, in accordance with applicable laws, with (i) the report prepared by an independent expert appointed pursuant to the provisions of Article L. 225-209-2 of the French Commercial Code and (ii) the auditors' report on this resolution.
II.
DECISIONS FALLING WITHIN THE SCOPE OF THE EXTRAORDINARY SHAREHOLDERS’ MEETING
A.
AUTHORIZATION TO THE BOARD OF DIRECTORS TO REDUCE THE COMPANY’S SHARE CAPITAL BY CANCELLING SHARES AS PART OF THE AUTHORIZATION TO THE BOARD OF DIRECTORS ALLOWING THE COMPANY TO BUY BACK ITS OWN SHARES IN ACCORDANCE WITH THE PROVISIONS OF ARTICLE L. 225-209-2 AND L.225-208 OF THE FRENCH COMMERCIAL CODE - AUTHORIZATION TO THE BOARD OF DIRECTORS FOR THE COMPANY TO BUY BACK ITS OWN SHARES FOLLOWED BY THEIR CANCELLATION [RESOLUTIONS 13 TO 15]

Share cancellation on the grounds of Article L. 225-209-2 of the French Commercial Code
You are being asked to authorize the board of directors to proceed with the cancellation, on one or more occasions, of up to the total cap of 10% of the share capital of the Company in any 24-month period, of all or part of the Company shares repurchased on the basis of article L. 225-209-2 of the French Commercial Code pursuant to Resolution 12 above.

This authorization would be granted for a period of twelve (12) months (valid through June 24, 2021).





Share cancellation on the grounds of Article L. 225-208 of the French Commercial Code
Moreover, you are being asked to authorize the board of directors to proceed with the cancellation, on one or more occasions, up to a total cap of €165,507.2, representing 10% of our share capital as of March 31, 2020, of all or part of the Company shares purchased pursuant to Article L. 225-208 of the French Commercial Code.
This authorization would allow the Company to comply with the provisions of Article L. 225-214 of the French Commercial Code, which imposes the cancellation of shares purchased by the Company on the grounds of Article L.225-208 that have not been allocated within one year of their repurchase.

This authorization would be granted for a period of twelve (12) months (valid through June 24, 2021) and shall not be used during a public tender offer by a third party.

Share buy-back followed by a share capital cancellation
Finally, you are being asked to authorize the board of directors to reduce the Company's share capital by a maximum nominal amount of €165,507.2, by way of a repurchase by the Company of up to 6,620,288 shares (representing approximately 10 % of the share capital as of March 31, 2020) followed by the cancellation of the shares acquired, in accordance with the provisions of Articles L. 225-204 and L. 225-207 of the French Commercial Code.
This resolution aims to allow all shareholders who so wish to benefit from a liquidity opportunity on their shares in proportion to their participation in the capital. The cancellation of the shares thus repurchased will have a relutive effect on the other shareholders.
In this context, you are being asked to authorize the board of directors to make a share buyback offer to all Company shareholders, to implement the share capital reduction, and to determine its final amount.
The unitary repurchase price will be determined by the board of directors within the limit of a maximum price of $22.75 per share (or the equivalent in euros of this amount on the date of implementation of this delegation), i.e. a maximum aggregate amount of $150,611,522 for the transaction.
The Company's creditors may object to the share capital reduction during a period of 20 days following the filing at the Commercial Court registry of the minutes of the shareholders' meeting and of the minutes of the deliberations of the board of directors implementing the delegation.
The authorization to the board of directors would be granted for a period of 18 months and could not be implemented in the event of a public tender offer on the Company.
This authorization would be granted for a period of eighteen (18) months (valid through December 24, 2021) and could not be implemented in the event of a public tender offer on the Company (or the announcement of such offer).

B.
AUTHORIZATIONS AND DELEGATION TO BE GIVEN WITH RESPECT TO EQUITY GRANTS TO EMPLOYEES, EXECUTIVES AND DIRECTORS OF THE BOARD OF DIRECTORS OF THE COMPANY [RESOLUTIONS N°16 TO 19]

The board of directors wishes to be able to continue, in accordance with past practice, to grant equity to employees, executives and to members of the board of directors. We therefore request that you renew the authorizations and delegations which were previously been granted respectively to the board of directors by the combined shareholders' meeting of June 28, 2017 to grant time-based restricted stock units (“RSUs”) of the Company, performance-based RSUs (“PSUs”) of the Company and grant options to subscribe for or purchase Ordinary Shares of the Company.

The board of directors reminds you in that regard:
The strategic importance of the Company’s ability to attract and retain highly talented profiles through remuneration and equity policies in accordance with the practice held on its highly competitive technology industry, and;
That 100% of Criteo’s employees are eligible, pursuant to the Company’s equity policy, to be granted RSUs and options.

The new authorizations and delegations granted would supersede any previous authorizations and delegations having the same purpose.

Pursuant to Resolution 19, the total cap amount of the shares issued pursuant to the Resolutions 16 to 18 will not exceed 6,463,000 shares with a par value of €0,025 per share, however, please note that this global limit does not include any additional shares issued to preserve, in accordance with applicable contractual provisions, the rights of any holder of securities or other rights giving access to shares of the Company (see Resolution 19).

The authorizations for granting options or RSUs or PSUs of the Company would be granted for a period of 38 months (until August 8, 2023).

We therefore ask that you review and approve each of the following proposals:





a)
Resolution 16: Authorization to be given to the board of directors to grant options to subscribe to new ordinary shares (“OSAs”) ( or options to purchase ordinary shares (“OAAs”) of the Company pursuant to the provisions of Articles L. 225-177 et seq. of the French Commercial Code
You are asked to authorize the board of directors, within the context of Articles L. 225-177 to L. 225-185 of the French Commercial Code, to grant, within the duration allowed by law and on one or more occasions, OSAs or OAAs to corporate officers listed in Article L. 225-185 of the French Commercial Code, employees (or some of them) of the Company and of any company or economic interest group related to the Company, under the conditions referred to in Article L. 225-180-I of the French Commercial Code, provided that:

the number of shares that may be issued or purchased upon the exercise of options granted pursuant to this authorization shall be deducted from the overall cap referenced in Resolution 19 and shall not exceed the legal limits, and
the total number of shares to be issued on exercise of granted but unexercised OSAs may never exceed one third of the share capital,


The purchase or subscription price per share shall be determined by the board of directors on the day the OSA or OAA is granted by reference to the closing price of an ADS on the Nasdaq Stock Market on the day preceding the grant of the OSA or OAA by the board of directors. However, the purchase or subscription price per share may not, under any circumstance, be less than 95% of the weighted average closing price of an ADS on the Nasdaq Stock Market in the twenty trading days preceding the day of the grant of the OSA or OAA by the board of directors.

b)
Resolution 17: Authorization to be given to the board of directors to grant time-based RSUs to employees and corporate officers of the Company and employees of its subsidiaries pursuant to the provisions of Articles L. 225-197-1 et seq. of the French Commercial Code
You are asked to authorize the board of directors to grant, on one or more occasions, in the proportions and at the times it shall determine, RSUs, in favor of all or certain employees of the Company or of companies or economic interest groups in which the Company holds, directly or indirectly, at least 10% of the share capital or voting rights on the date of grant of the relevant shares, in France or abroad (the "Criteo Group"), as well as to the corporate officers listed in Article L. 225-197-1 II of the French Commercial Code (being, as of the date hereof, the chairman of the board of directors, the Chief Executive Officer and the Deputy Chief Executive Officers).

The maximum number of shares, with a par value of €0.025 per share, which can be granted free of charge by the board of directors under this authorization shall be deducted from the overall cap referred to in Resolution 19 and shall not exceed the legal limits.

The RSUs shall have a minimum vesting period (“Vesting Period”) of one year and a minimum holding period of one year from the vesting date (the “Holding Period”), provided the board of directors may reduce or remove the Holding Period entirely as long as it sets a total duration of at least two years for both periods (i.e., Vesting Period and Holding Period) taken together.

Notwithstanding the above, in the event of the disability of a grantee ranking in the second and the third of the categories referred to in Article L.341-4 of the French Social Security Code, the time-Based RSUs shall vest on the date of disability and that the shares underlying the time-Based RSUs delivered to the disabled grantee will be freely transferable as from the date of their vesting.
Notwithstanding the above, in the event of the death of a grantee during the vesting period, the time-Based RSUs 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 time-Based RSUs shall be made within six months from the date of death in compliance with Article L. 225-197-3 of the French Commercial Code.
The granted shares will be freely transferable on a request for allocation by the heirs of a deceased beneficiary or a beneficiary that becomes disabled under the aforementioned categories of the French Social Security Code.

The durations of the Vesting Period and the Retention Period shall be determined by the board of directors within the aforementioned limits.

c)
Resolution 18: Authorization to be given to the board of directors to grant performance-based restricted stock units (PSUs) to employees and corporate officers of the Company and employees of its subsidiaries, pursuant to the provisions of Articles L. 225-197-1 et seq. of the French Commercial Code
This authorization is identical to the authorization which will be granted under Resolution 17, apart from the fact that the effective grant of such PSUs will be subject to the satisfaction of performance targets as determined by the board of directors.






d)
Resolution 19: Approval of the overall limits on the amount of ordinary shares to be issued pursuant to Resolution 16 (authorization to grant OSAs or OAAs), Resolution 17 (authorization to grant time-based RSUs to employees and corporate officers of the Company and employees of its subsidiaries) and Resolution 18 (authorization to grant PSUs to employees and corporate officers of the Company and to employees of its subsidiaries) above
Pursuant to Resolution 19, you are asked to authorize a share reserve of 6,463,000 new ordinary shares, which will cover all issuances under Resolution 16 (authorization to grant OSAs or OAAs), Resolution 17 (authorization to grant time-based RSUs to employees of the Company and of its subsidiaries) and Resolution 18 (authorization to grant PSUs to executives and certain employees of the Company and its subsidiaries) above.

C.
FINANCIAL DELEGATIONS TO BE GRANTED TO THE BOARD OF DIRECTORS [RESOLUTIONS 20 TO 25]
The goal of Resolutions 20 to 23 is to allow the Company to swiftly raise the funds and have the financial flexibility necessary to enable it to execute on its strategic objectives, including, but not limited to, with respect to external growth. These resolutions would provide the board of directors with the flexibility it needs to respond quickly to changes in market conditions and thereby be able to obtain a relevant financing under the best possible conditions and terms.
While we believe the Company’s current liquidity position already provides ample financial flexibility,, the proposed financial authorizations would provide our board of directors with additional flexibility to respond quickly to changes in market conditions and thereby be able to obtain financing under the best possible conditions. As one of the potential purposes of our use of liquidity, our external growth strategy is focused on acquisitions that complement our technology platform and product portfolio, as well as Research & Development talent. Should we decide to be acquisitive, we are committed to pursuing external growth opportunities in a manner that will preserve the quality of our offering, while improving its performance and delivering long-term value for our shareholders.

Re-approving our board of directors’ financial authorizations will allow the Company to maintain equal footing with our U.S. competitors and to increase our financial flexibility by quickly raising capital and to take advantage of potential business opportunities, including, but not limited to, potential acquisitions. Although always important, we believe this flexibility is particularly necessary in light of the current worldwide economic challenges driven by the COVID-19 pandemic.
a)
Resolution 20: Delegation of authority to the board of directors to increase the Company’s share capital by issuing ordinary shares or, any securities giving access to the Company’s share capital while preserving the shareholders’ preferential subscription rights
You are asked to delegate to the board of directors the authority to decide to issue, on one or more occasions, in the proportions and at the times it shall determine, in France or abroad, in Euros, in foreign currencies or in any monetary unit established by reference to several currencies, for consideration or not, ordinary shares of the Company and any securities giving access by any means, immediately and/or in the future, to ordinary shares of the Company (such shares conferring the same rights as the existing shares subject to their date of possession).
Under this delegation, you are asked to:
decide that the shareholders have, proportionally to the amount of their shares, a preferential subscription right to the ordinary shares or securities which shall be, as appropriate, issued under the delegation herein,
provide the board of directors with the ability to grant to shareholders the right to subscribe, subject to pro rata reduction (à titre réductible), a higher number of shares or securities than the number to which they would be entitled to subscribe by irrevocable entitlement (à titre irréductible), proportionally to the rights they have and, in any event, in the amount of their request,
decide that the total nominal amount of the share capital increases which might thus be made, immediately and/or in the future, may not exceed €825,504.03 (representing 50% of the amount of the Company’s share capital as of March 31, 2020), with this amount being deducted from the total cap provided below (any additional amount of the shares issued, pursuant to legal, regulatory or, as applicable, contractual requirements, to protect the rights of the holders of securities and other rights giving access to shares shall be added to this maximum amount),
decide that the total nominal amount of the issuances of securities representing debt securities giving access to the share capital, which may be issued cannot exceed $500,000,000 (or the equivalent of this amount in case of issuance in another currency), with this amount being deducted from the total cap pursuant to Resolution 25 below.

b)
Resolution 21: Delegation of authority to the board of directors to increase the Company’s share capital by issuing ordinary shares, or any securities giving access to the Company’s share capital, through a public offering, without shareholders’ preferential subscription rights
Pursuant to Resolution 21, we are asking for your approval to increase the Company’s share capital by issuing ordinary shares through a public offering.
In addition to advancing the Company's external growth strategy, this resolution serves three distinct purposes:




To comply with the approach currently promoted by French regulatory authorities, pursuant to which, irrespective of whether a public offering is underwritten, this Resolution should be used rather than Resolution 22 to complete any such public offering because, unlike Resolution 22, it is grounded on provisions of the French Commercial Code meant precisely for public offerings. In particular, if the end result of the planned transaction is a public offering of securities in France, this resolution should be approved in order to ensure that the French regulatory authorities would view the financial delegations being granted at the annual general meeting as sufficient for all potential market participants;
To allow for a direct public offering, without the involvement of underwriters; and
To allow for the ordinary shares to be listed on a regulated market within the meaning of the French Commercial Code, namely, if applicable, on the Euronext stock market.
As set forth above, the Company intends to raise the funds necessary for the financing of the external growth operations and does not intend to make use of this Resolution for any other objective, particularly within the context of an unsolicited public takeover or any other context.
The total nominal amount of the share capital increases which might thus be made, immediately and/or in the future, may not exceed €165,507.2, representing 10% of the amount of the Company’s share capital as of March 31, 2020 any additional amount of the shares issued, pursuant to legal, regulatory or, as applicable, contractual requirements, to protect the rights of the holders of securities and other rights giving access to shares shall be added to this maximum amount, which would give sufficient flexibility to meet its strategic objectives. This amount shall be deducted from the total cap pursuant to Resolution 25 below.
The total nominal amount of the issuances of securities representing debt securities giving access to the share capital, which may be issued cannot exceed $500,000,000 (or the equivalent of this amount in case of issuance in another currency), with this amount being deducted from the total cap pursuant to Resolution 25 below.
Within this framework, you are asked to approve the cancellation of the preferential subscription rights of the shareholders on the ordinary shares or securities issued under the delegation herein, although the board of directors will retain the ability, on all or part of any such issuances, to grant shareholders a priority subscription period in accordance with the provisions of Article L. 225-135 of the French Commercial Code. This priority subscription will not give rise to the creation of negotiable rights, but may be exercised by irrevocable entitlement (à titre irréductible) or subject to pro rata reduction (à titre réductible), it being specified that this right may only be granted if the Company’s shares are admitted for trading on a regulated market recognized as such by the Autorité des Marchés Financiers (for which the Nasdaq Stock Market does not currently qualify).
We therefore propose, under the delegation herein, that you decide that the issuance price of the shares which may be issued under the delegation herein shall be determined by the board and shall be at least equal to the volume-weighted average price of the ADSs over the course of the five trading days preceding the fixing of the issue price, subject to a maximum discount of 10%, as determined by the board of directors.
This delegation would be granted for 26 months (i.e. until August 8, 2022) and would supersede the corresponding delegation granted by the shareholders’ meeting of June 27, 2018.
In this respect, the board of directors informs you that it has not made use of the corresponding delegation that was granted by the shareholders’ meeting on June 27, 2018, nor pursuant to any prior similar authorizations granted in the past.
This delegation shall not be, directly or through sub-delegation, implemented during an unsolicited public tender offer initiated by a third-party.

c)
Resolution 22: Delegation of authority to the board of directors to increase the Company’s share capital by issuing ordinary shares, or any securities giving access to the Company’s share capital, for the benefit of a category of persons meeting predetermined criteria (underwriters), without shareholders’ preferential subscription rights.
The purpose of this delegation is to allow for the issuance of shares to underwriters in connection with an underwritten offering, similar to the offering carried out concurrently with our initial public offering in October 2013 on the Nasdaq Stock Market. We would use the delegation granted pursuant to this Resolution 22 (rather than Resolution 21) in the event that the French regulatory authorities revise their current approach (which favors the use of Resolution 21 in any public offering, even an underwritten offering) with respect to underwritten public offerings in the U.S. market.
You are asked to waive shareholders’ preferential subscription rights to the ordinary shares and securities that will be issued by virtue of this delegation, and to reserve this subscription for any bank, investment services provider, or other member of an underwriting syndicate undertaking (underwriting) to ensure the realization of the share capital increase or any issuance that could in the future lead to a share capital increase in accordance with this delegation of authority.
The price of the shares will be at least equal to the volume-weighted average price of the ADSs for the five trading days preceding the determination of such price, subject to a maximum discount of 10%, as determined by the board of directors.
The total maximum nominal amount of the share capital increases which may be carried out pursuant to this delegation cannot exceed €165,507.2, representing 10% of the share capital as of March 31, 2020. To this amount shall be added, as applicable, the amount of any additional shares to be issued to maintain, pursuant to legal, regulatory or, if applicable, contractual requirements, the rights of the




security holders and other rights giving access to the share capital. The nominal amount of any share capital increase completed pursuant to this resolution will be deducted from the overall limit set forth in Resolution 25.
The aggregate nominal amount of debt securities giving access to the Company’s share capital that may be issued cannot exceed $500.000.000 (or the corresponding value of this amount for an issuance in a foreign currency), which shall be deducted from the global amount set by Resolution 25.
As set forth above, the Company expects that it would use this resolution to raise the funds for general corporate purposes and to finance potential external growth transactions, and does not intend to make use of this resolution for any other objective, particularly within the context of an unsolicited public takeover or any other context.
To do so, the Company considers that a share capital increase in the maximum amount of 10% of the share capital would give it sufficient flexibility to meet its strategic objectives.
This delegation would be granted for 18 months (i.e., until December 8, 2021) and will supersede the corresponding delegation granted by the shareholders’ meeting of May 16, 2019 which, in the absence of a favorable vote, will expire on November 16, 2020, and may impair the Company’s ability to obtain appropriate financing to execute on its strategic objectives.
In this respect, the board of directors informs you that it has not made use of the corresponding delegation that was granted by the shareholders’ meeting on May 16, 2019, nor pursuant to any prior similar authorizations granted since the completion of the Company’s follow-on offering after its initial public offering.
This delegation shall not be, directly or through sub-delegation, implemented during an unsolicited public tender offer initiated by a third-party.

d)
Resolution 23: Delegation of authority to the board of directors to increase the number of securities to be issued as a result of a share capital increase pursuant to the delegations in Resolutions 20 to 22 and in Resolution 24 of the shareholders’ meeting of May 16, 2019, with or without shareholders' preferential subscription rights
The purpose of this Resolution 23 is to allow the board of directors to grant a customary over-allotment option for any issuance pursuant to Resolutions 20 to 22 and pursuant to Resolution 24 of the shareholders’ meeting of May 16, 2019. Any share capital increase pursuant to this delegation would be at the same price, and limited to 15% of the initial issuance.

e)
Resolution 24: Capital increase reserved for the employees of group savings plan
Pursuant, to Articles L. 225-129 et seq. and L. 225-138-1 of the French Commercial Code and Articles L. 3332-1 et seq. of the French Labor Code, the board of directors is required to submit to the approval of the shareholders’ meeting a resolution to authorize the board of directors to increase the Company’s share capital through the issuance of shares and securities giving access to the share capital of the Company for the benefit of employees who are members of a Company savings plan (plan d’épargne d’entreprise).
In this context, we propose that the total nominal amount of the share capital increases under this delegation not exceed €49,652.15, representing 3% of the share capital as of March 31, 2020 (any additional amount of the shares issued, pursuant to legal, regulatory or, as applicable, contractual requirements, to protect the rights of the holders of securities and other rights giving access to shares shall be added to this maximum amount).
The nominal amount of any capital increase which may be made pursuant to this delegation would be deducted from the global limit set forth in Resolution 25.
The total nominal amount of the issuances of securities representing debt claims giving access to the share capital pursuant to this resolution shall not exceed $500,000,000 (or the equivalent of this amount in case of issuance in another currency) and will be deducted from the global limit set forth in Resolution 25.
The issuance price of the new shares or securities giving access to the share capital would be determined by the board of directors pursuant to Articles L. 3332-18 to L. 3332-23 of the French Labor Code. For the benefit of the members of a company savings plan, the preferential subscription right of the shareholders to the shares or securities would be eliminated.
To date, we have not implemented any company savings plans involving equity of the Company and thus employees have not received any shares thereunder. However, approving this resolution will enable our board of directors to adopt such a company plan if it determines in the future that such a plan is appropriate to strengthen employee and shareholder alignment.





f)
Resolution 25: Approval of the overall limits on the amount of ordinary shares to be issued pursuant to the delegations in Resolutions 20 to 22, 24 and Resolution 27
The board of directors proposes to set at €165,507.2, representing 10% of the share capital as of March 31, 2020, the aggregate maximum amount of the share capital increases which could be made under Resolutions 21, 22, 24 and 27. We believe that this amount strikes the correct balance between protecting our existing shareholders and providing the Company sufficient flexibility in order to achieve its strategic objectives in terms of external growth.
The aggregate nominal amount of debt securities giving access to the Company’s share capital that may be issued pursuant to Resolutions 20 to 22, 24 and 27 cannot exceed $500,000,000 (or the corresponding value of this amount for an issuance in a foreign currency).
The board of directors intends, whenever possible, to grant the shareholders a priority subscription period for issuances carried out pursuant to these delegations.

D.
VOTE ON THE DELEGATION OF AUTHORITY TO THE BOARD OF DIRECTORS TO DECIDE ON ANY MERGER-ABSORPTION, SPLIT OR PARTIAL CONTRIBUTION ASSET - DELEGATION OF AUTHORITY TO THE BOARD OF DIRECTORS TO INCREASE THE SHARE CAPITAL IN RELATION WITH ANY MERGER-ABSORPTION, SPLIT OR PARTIAL CONTRIBUTION ASSET [RESOLUTIONS 26 AND 27]

The Action Plan for Business Growth and Transformation, enacted on May 22, 2019 (the “PACTE Law”) gave the possibility to the extraordinary shareholders meeting of the acquiring company to delegate to its board of directors its competence in making decision relating to a merger for a period that cannot exceed 26 months. Pursuant to Resolution 26, we are asking the shareholders to delegate authority to the board of directors of the Company to decide on any merger-absorption, split or partial contribution of asset in order to shorten the process related to those operations (allowing the Company to reach all business opportunity).

This delegation would be granted for a period of 26 months.

If Resolution 26 were adopted, it is necessary to grant to the board of directors a delegation to increase the Company’s share capital by issuing ordinary shares and/or any security giving access to the Company’s share capital in the course of merger-absorption, split or partial contribution of asset decided by the board of directors pursuant to the delegation granted in Resolution 26 above.

The aggregate nominal amount of the share capital increase that may arise pursuant to this delegation cannot exceed €165,507.2, representing 10% of the share capital as of March 31, 2020. To this amount shall be added, as applicable, the amount of any additional shares to be issued to maintain, pursuant to legal, regulatory or, if applicable, contractual requirements, the rights of the security holders and other rights giving access to the share capital. The nominal amount of any share capital increase completed pursuant to this resolution will be deducted from the overall limit set forth in Resolution 25.
The total nominal amount of the issuances of securities representing debt claims giving access to the share capital pursuant to this resolution shall not exceed $500,000,000 (or the equivalent of this amount in case of issuance in another currency) and will be deducted from the global limit set forth in Resolution 25.
This delegation would be granted for a period of 26 months.

E.
AMENDMENT OF THE COMPANY’S BY-LAWS [RESOLUTIONS 28 TO 30]

Finally the purpose of the following Resolutions 28 to 30 is to amend the Company’s by-laws in order to comply with applicable legal provisions.
a)
Resolution n°28 : Amendment of Article 12 of the Company’s By-laws
The Law for the Simplification of French Corporate Law dated July 20, 2019 (the “Simplification Law”) introduced the possibility for the board of directors to make the decisions referred to in Articles L. 225-37 and L. 225-82 of the French Commercial Code using a written consultation of the members of the board of directors, provided that this possibility is included in the Company’s by-laws. You are therefore asked to amend Article 12 of the Company’s by-laws (“Board of directors Meetings”) by adding paragraph 12.7 drafted as follows:

“The Board of directors may also take by written consultation of the Directors the following decisions that fall within the specific powers of the Board of directors:
Appointment of the Board’ members provided for in Article L. 225-24 of the French Commercial Code,
Authorization of sureties, endorsements and guarantees provided for in the last paragraph of Article L. 225-35 of the French




Commercial Code,
Decisions taken upon delegation granted by the shareholder meeting pursuant the second paragraph of Article L. 225-36 of the French Commercial Code, to modify the by-laws to amend them with the legal and regulatory provisions,
Convening of the shareholders’ meetings, and
Transfer of the head office in the same department.

When the decisions is taken by written consultation, the text of the proposed resolutions together with the voting form are sent by the Chairman of the Board of directors to every one of its members by electronic means.
The directors have a period of three (3) working days (or any shorter delay indicated in the request sent by the Chairman or the secretary of the Board of directors) following receipt of the text of the proposed resolutions and of the voting form vote to complete and send to the Chairman or the secretary of the Board of directors by electronic means the voting form, dated and signed, by checking for each resolution, a unique box corresponding to the meaning of its vote.
If none or more than one box have been ticked for a same resolution, the vote shall be null and void and shall not be taken into account in the calculation of the majority.
Any director who has not sent his reply within the above mentioned time limit will be considered absent and his vote will therefore not be taken into account for the calculation of the quorum and the majority.
During the delay of response, any director may require any additional explanations from the initiator of the consultation.
Within five (5) working days following the receipt of the last voting form, the Chairman shall draw up and date the minutes of the deliberations to which the voting forms shall be appended and which shall be signed by the Chairman of the Board of directors and one director.”

Consequently, Article 12.7 shall become Article 12.8 of the Company’s by-laws.

b)
Resolution N°29 : Amendment of Article 13 of the Company’s By-laws
In order to make the by-laws of the Company compliant with the provisions of Article L. 225-35 of the French Commercial that was amended by the Pacte Law and pursuant to which the board of directors shall now take into account social and environmental issues when determining the Company’s strategy, you are therefore asked to amend Article 13 of the Company’s by-laws as follows:
“ Article 13 - Powers of the Board of directors
The Board of directors determines the orientations of the Company’s activity and ensure they are carried out, in accordance with its social interest and taking into consideration its social and environmental challenges. Subject to the powers expressly granted to shareholders’ meetings, and within the limits of the corporate purposes, the Board of directors may consider any issue relating to the proper operation of the Company and shall resolve matters that concern the Company by its decisions.”
c)
Resolution n°30 : Amendment of Article 19 of the Company’s By-law

Pursuant to the provisions of the Simplification Law the required majority for the adoption of the resolutions by general shareholders’ meetings shall now only include expressed votes by shareholders who are present or represented : abstentions, blank votes, void votes or failure to take part in a vote will not be counted as votes “FOR” or “AGAINST” such matter. Therefore, you are asked to amend paragraphs 15 and 17 of Article 19 of the Company’s by-laws as follows:

15th paragraph:
Decisions of ordinary general meetings shall be adopted by a majority of the votes cast by the shareholders present or represented. The votes expressed do not include those attached to the shares for which the shareholder did not take part in the vote, abstained or voted blank or void.

17th paragraph:
Decisions of extraordinary general meetings shall be adopted by a majority of two-thirds of the votes cast by the shareholders present or represented. The votes expressed do not include those attached to the shares for which the shareholder did not take part in the vote, abstained or voted blank or void.





COMBINED SHAREHOLDERS’ MEETING - JUNE 25, 2020


Appendix: Executive Compensation

COMPENSATION DISCUSSION AND ANALYSIS
The following compensation discussion and analysis provides comprehensive information and analysis regarding our executive compensation program for 2019 for our named executive officers and provides context for the decisions underlying the compensation reported in the executive compensation tables in this proxy statement. For 2019, our named executive officers included (i) our principal executive officers during 2019; (ii) our principal financial officer; (iii) our other executive officer, other than the principal executive officer and the principal financial officer, who was serving as of the end of the fiscal year and (iv) our two former executive officers who served during 2019. Unless otherwise noted, titles referred to in this section are as of December 31, 2019. For the year ended December 31, 2019, our named executive officers were:
Megan Clarken
 
Chief Executive Officer (principal executive officer)
Jean-Baptiste Rudelle
 
Former Chief Executive Officer
Benoit Fouilland
 
Chief Financial Officer (principal financial officer)
Ryan Damon
 
General Counsel & Corporate Secretary
Mary Spilman
 
Former Chief Operating Officer
Dan Teodosiu
 
Former Chief Technology Officer
Certain amounts in this Compensation Discussion and Analysis relating to compensation in 2019 have been converted from euros to U.S. dollars at a rate of €1.00 = $1.119574, which represents the average exchange rate for the year ended December 31, 2019, and certain amounts relating to compensation in 2018 have been converted from euros to U.S. dollars at a rate of €1.00 = $1.181026, which represents the average exchange rate for the year ended December 31, 2018.
We believe that we have a strong team of executives who have the ability to execute our strategic and operational priorities. The combination of strong executive leadership and highly talented and motivated employees played a key role in our solid financial performance in 2019 in a challenging context, as described below.
2019 Financial and Operating Highlights
We are a global technology company powering the world's marketers with trusted and impactful advertising. We strive to deliver measurable business results at scale across multiple marketing goals for retailers and brands, through our self-service Criteo Platform. Using shopping data, artificial intelligence ("AI") technology and extensive consumer reach, we help marketers drive Awareness, Consideration and Conversion for their products and services and help retailers generate advertising revenues from consumer brands. Our data is pooled among our clients and offers deep insights into consumer intent and purchasing habits. To drive trusted and impactful advertising for marketers, we activate our data assets in a privacy-by-design way through proprietary AI technology to engage consumers in real time by designing, pricing and delivering highly relevant digital advertisements ("ads") across devices and environments. We price our offering on a range of pricing models and measure our value based on clear, well-defined performance metrics, making our impact on the business of our clients both transparent and easy to measure.
Our mission is to power the world's marketers, brands, retailers, publishers, content creators, and agencies with trusted and impactful advertising. We enable our clients to address multiple goals across the marketing funnel through the Criteo Platform. Our vision is to build the leading advertising platform for the open Internet.
Leadership Transition:
Effective November 25, 2019, Megan Clarken became our Chief Executive Officer. On the same date, Jean-Baptiste Rudelle stepped down from his position as our Chief Executive Officer, a position he had held since April 25, 2018, and previously from the founding of our Company until January 1, 2016. Mr. Rudelle retained his role as chairman of our board of directors.
For more information on the specific elements of compensation paid to each of our named executive officers, including Mr. Rudelle, please see “Elements of Executive Compensation” below and “Compensation Tables—Summary Compensation Table.”
2019 Financial Highlights:
Our 2019 financial results include:
Revenue declined 2%, or increased 1% at constant currency, from $2,300 million in 2018 to $2,262 million in 2019;




Revenue excluding traffic acquisition costs, which we refer to as Revenue ex-TAC, which is a non-GAAP financial measure, decreased 2%, or increased 0.3% at constant currency, from $966 million in 2018 to $947 million in 2019;
Net income was $96 million in 2019, flat compared to the prior year; and
Adjusted EBITDA, which is a non-GAAP financial measure, decreased 7%, or 3% at constant currency, from $321 million in 2018 to $299 million in 2019.
Revenue ex-TAC and Adjusted EBITDA are non-GAAP measures. We define Revenue ex-TAC as our revenue excluding traffic acquisition costs. We define Adjusted EBITDA as our consolidated earnings before interest, taxes, depreciation and amortization, adjusted to eliminate the impact of equity awards compensation expense, pension service costs, restructuring costs, acquisition-related costs and deferred price consideration. Traffic acquisition costs consist of purchases of impressions from publishers. We purchase impressions directly from publishers or third-party intermediaries, such as advertising exchanges. We recognize cost of revenue on a publisher by publisher basis as incurred. Costs owed to publishers but not yet paid are recorded in our consolidated statements of financial position as accounts payable and accrued expenses. Please refer to footnotes 3, 4 and 5 to the “Other Financial and Operating Data” table in “Item 6. Selected Financial Data” of our Annual Report on Form 10-K for a reconciliation of Revenue ex-TAC to revenue and Adjusted EBITDA to net income, in each case the most directly comparable financial measure calculated and presented in accordance with GAAP. Constant currency measures exclude the impact of foreign currency fluctuations and is computed by applying the 2018 average exchange rates for the relevant period to 2019 figures.
The following charts show the growth of our revenue, Revenue ex-TAC, net income, Adjusted EBITDA and cash flow from operating activities over the past three years:





2019 Operating Highlights:
We added 828 net new clients, ending the year with more than 20,200 clients globally, a 4% increase year-over-year, while maintaining an average client retention rate of approximately 90% over the past three years;
New solutions, which include all solutions outside of retargeting, grew 54% year-over-year to 12% of total Revenue ex-TAC, including 16% in the fourth quarter of 2019;
Our retargeting business declined slightly, in particular with large customers;
At the end of 2019, 800 clients were already live with our Consideration products priced on cost-per-impression (or CPM) basis just one quarter after beta launch in the third quarter of 2019; and
Our direct header-bidding technology connects to over 4,500 publishers across Web and App.

2019 Executive Compensation Highlights
Highlights of our executive compensation program for 2019 include:
We continue to maintain rigorous short- and long-term incentive compensation programs for our executive officers to ensure fair ongoing pay-for-performance outcomes and strong alignment with our shareholders:
We paid annual incentive bonuses to our named executive officers with funding at 79.4% of target (with the exception of Megan Clarken, whose bonus was granted at 100% of target, prorated for the period from November 25, 2019 through the end of the fiscal year in accordance with her management agreement), reflecting the rigor of our incentive compensation program and its strenuous Company performance targets, despite high overall achievement of our executives’ individual goals, as described below under the heading “—Elements of Executive Compensation Program—Annual Incentive Bonus”;
50% of the performance stock units (“PSUs”) granted to certain of our named executive officers in 2019 were earned, as we met the target of our Free Cash Flow performance goals but did not meet the threshold for our Gross Revenue performance goals for 2019. As a result, target PSU awards with a total grant date fair value of $1,806,299.30 to our named executive officers in 2019 were forfeited;
The PSUs and restricted stock units (“RSUs”) granted in 2019 to Mary Spilman, our former Chief Operating Officer, and Dan Teodosiu, our former Chief Technology Officer, were forfeited when they left the Company; and
The stock options granted to Megan Clarken in 2019 will only deliver realizable value over time if our stock price appreciates from the date of grant. The exercise price of Ms. Clarken’s stock options is €15.67 ($17.54 at a rate of €1.00 = $1.119574, which represents the average exchange rate for the year ended December 31, 2019).
Ms. Clarken has not yet realized value from these grants. No other named executive officers received stock options in 2019.
We updated our compensation peer groups to maintain alignment with key attributes of the Company (including our industry, market capitalization and certain financial attributes, such as annual revenue and annual revenue growth), and to reflect the Company’s position in the market and determined executive compensation levels with reference, in part, to these reasonable comparator groups;




We continued the practice by which a majority of our executive officers’ target total direct compensation opportunity is paid in the form of long-term performance-based equity incentives, including PSUs, RSUs, and stock options, each of which vest over four years, and generally only provide realizable pay opportunities for executives with demonstrated growth in Company value over time or achievement of measurable, objective, pre-determined performance goals; and
We maintained performance targets for executive bonuses that give more importance to quantitative measures of Company performance over qualitative performance goals for our named executive officers, in order to align our executives’ interests even more closely with those of our shareholders.

Executive Compensation Policies and Practices
We maintain several policies and practices, including compensation-related corporate governance standards, consistent with our executive compensation philosophy:
What We Do
 
What We Don’t Do
•    Clawback policy allows recoupment of incentive compensation paid to executive officers if our financial statements are the subject of a restatement or in the event of misconduct
•    Performance-based equity incentives
•    Performance-based annual incentive bonus
•    Caps on performance-based cash and equity compensation
•    Annual compensation program review and, where appropriate, alignment with our compensation peer group; review of external competitive market data when making compensation decisions
•    Significant portion of executive compensation contingent upon corporate performance, which directly influences stockholder return
•    Four-year equity award vesting periods, including a one-year performance period and a two-year initial vesting cliff for PSUs
•    Prohibition on short sales, hedging of stock ownership positions and transactions involving derivatives of our ADSs
•    Limited executive perquisites
•    Independent compensation consultant engaged by our compensation committee
•    Annual board and committee self-evaluations
•    Established market practice chairman and Section 16 executive officer share ownership requirement guidelines (new for 2019)
 
•    No “single-trigger” change of control benefits
•    No post-termination retirement or pension non-cash benefits or perquisites for our executive officers that are not available to our employees generally
•    No tax “gross-ups” for change of control benefits
    No employment agreements with executive officers that contain guaranteed salary increases or equity compensation
    No discounted stock options or option re-pricings without shareholder approval
    No payment or accrual of dividends on unvested stock option, PSU or RSU awards




Executive Pay Mix for 2019
The charts below show the target total pay mix for 2019 of each of Ms. Clarken, our current Chief Executive Officer, Mr. Rudelle, our former Chief Executive Officer, and Mr. Fouilland, our Chief Financial Officer. The chart for Ms. Clarken excludes her $300,000 sign-on bonus received when she joined the Company in November 2019, but includes her full annual salary and target bonus. The chart illustrates the predominance of performance-based compensation and variable (as opposed to fixed) long-term incentive compensation through equity awards in our executive compensation program. We believe that this weighting of components allows us to reward our executives for achieving or exceeding our financial, operational and strategic performance goals, and align our executives’ long-term interests with those of our shareholders.
For more information on the pay mix for our named executive officers, please see “Compensation Tables—Summary Compensation Table.”
Realizable Pay for 2019
Because our compensation committee aims to align executives’ incentives with shareholder value creation, the majority of our named executive officers’ compensation is composed of equity awards, the value of which is significantly impacted by both stock-based performance and Company financial performance. There is no assurance that the grant date fair values reported in the Summary Compensation Table for these equity awards will be reflective of their actual economic value or that comparable amounts will ever be realized by our named executive officers. For example, we granted PSUs to Messrs. Rudelle, Fouilland and Teodosiu, and Ms. Spilman, in 2019 that were scheduled to vest in April 2021 based on achievement of our pre-determined Gross Revenue and Free Cash Flow goals, but, as a result of Company financial performance against established targets over the measurement period, only 50% of these PSUs were earned (as described further below). Similarly, the stock options granted to Ms. Clarken in 2019 were “out-of-the-money” at fiscal year-end and will only deliver actual value to her with future stock price appreciation above the exercise price of such stock options.
The chart below compares 2019 target total compensation provided to each of Mr. Rudelle, our former Chief Executive Officer for the 2019 fiscal year until November 25, 2019, and Mr. Fouilland, our Chief Financial Officer, to the value of the pay realizable for each pay component by Messrs. Rudelle and Fouilland as of fiscal year end 2019. We have not included Mr. Damon in the chart because Mr. Damon first became a named executive officer in 2019, and his 2019 compensation was not decided by the compensation committee. Target total compensation for the chart below represents: (1) base salary, (2) 2019 target cash bonus opportunity (100% of base salary in the case of Mr. Rudelle, and 75% of base salary in the case of Mr. Fouilland), and (3) the aggregate grant date fair values of PSUs and RSUs (including special supplemental RSUs, as described below) granted to each of Mr. Rudelle and Mr. Fouilland in 2019 (as reflected in the Stock Awards and Option Awards columns of the Summary Compensation Table included below under the heading “Compensation Tables”). Mr. Rudelle’s total target compensation for fiscal year 2019 was $9,254,767, and Mr. Fouilland’s total target compensation for fiscal year 2019 was $4,589,610. For more information, please see “Compensation Tables—Summary Compensation Table.”
Total realizable compensation for the chart below represents: (1) each executive’s base salary, (2) each executive’s actual earned cash bonus for 2019 (as disclosed in the Summary Compensation Table), and (3) the actual intrinsic value of the equity awards, as of December 31, 2019, granted to each of Mr. Rudelle and Mr. Fouilland in 2019. For PSUs, this amount is calculated by multiplying the number of shares earned by each executive in 2019 by our closing stock price on December 31, 2019. For RSUs, this amount is calculated by multiplying the number of RSUs allocated to each executive in 2019 by our closing price on December 31, 2019. In addition, we have shown realizable compensation using our closing stock price on March 20, 2020.
Mr. Rudelle’s realizable pay for fiscal 2019 was approximately $7,909,699, or approximately 85% of his fiscal 2019 target total pay using our closing stock price on December 31, 2019, and approximately $3,187,000, or approximately 34% of his fiscal 2019 target total pay using our closing stock price on March 20, 2020. Mr. Fouilland’s realizable pay for fiscal 2019 was approximately $3,945,309, or approximately 86% of his fiscal 2019 target total pay using our closing stock price on December 31, 2019, and approximately $1,738,000, or approximately 38% of his fiscal 2019 target total pay using our closing stock price on March 20, 2020.
Former Chief Executive Officer             Chief Financial Officer




Compensation Philosophy and Objectives
Pay for Performance
Our philosophy in setting compensation policies for our executive officers has four fundamental objectives: (1) to attract and retain a highly skilled team of executives in competitive markets; (2) to reward our executives for achieving or exceeding our financial, operational and strategic performance goals; (3) to align our executives’ long-term interests with those of our shareholders; and (4) to provide compensation packages that are both competitive and reasonable relative to our peers and the broader competitive market. The compensation committee and the board of directors believe that executive compensation should be directly linked both to continuous improvements in corporate performance and to accomplishments that are expected to increase shareholder value over time. Historically, the board of directors has compensated our executive officers through three direct compensation components: base salary, an annual incentive bonus opportunity and long-term incentive compensation in the form of equity awards. The compensation committee and the board of directors believe that cash compensation in the form of base salary and an annual incentive bonus opportunity provides our executive officers with short-term rewards for success in operations, and that long-term incentive compensation in the form of equity awards increases retention and aligns the objectives of our executive officers with those of our shareholders with respect to long-term performance. Since 2015, long-term equity compensation for our executive officers has consisted of both PSU awards and stock options. Since 2019, we have included RSUs in the overall mix of compensation for our executive officers in place of stock options, outside of stock options granted in connection with inducement or initial equity awards. For more information, please see “—Long Term Incentive Compensation.”
Participants in the Compensation Process
Role of the Compensation Committee and the Board of Directors
In accordance with French law, committees of our board of directors have an advisory role and can only make recommendations to our board of directors. As a result, while our compensation committee is primarily responsible for our executive compensation program, including establishing our executive compensation philosophy and practices, as well as determining specific compensation arrangements for the named executive officers, final approval by our board of directors is required on all such matters. The board of directors’ decisions and actions regarding executive compensation referred to throughout this Compensation Discussion and Analysis are made following the compensation committee’s comprehensive in-depth review, analysis and recommendation.
The board of directors approves the performance goals recommended by the compensation committee under the Company’s annual and long-term incentive plans and achievement by our executive officers of these goals. While the compensation committee draws on a number of resources, including, for 2019, input from Mr. Rudelle and Ms. Clarken, who each served as our Chief Executive Officer during 2019, and the compensation committee’s compensation consultant, to make decisions regarding our executive compensation program, the compensation committee is responsible for making the ultimate recommendation to be approved by the board of directors. The compensation committee relies upon the judgment of its members in making recommendations to the board of directors after considering several factors, including recommendations of the chairman of the board of directors and the Chief Executive Officer with respect to the compensation of executive officers (other than their own compensation), Company and individual performance, perceived criticality, retention objectives, internal fairness, current compensation opportunities as compared to similarly situated executives at peer companies (based on a review of competitive market analyses prepared by its compensation consultant) and other factors as it may deem relevant.
Role of Compensation Consultant
The compensation committee retains the services of Compensia as its independent compensation consultant. The mandate of the compensation consultant includes assisting the compensation committee in its review of executive and director compensation practices, including the competitiveness of pay levels, design of the Company’s annual and long-term incentive compensation plans, executive compensation design, and analysis of competitive market practices. The compensation committee is responsible for oversight of the work of the compensation consultant and annually evaluates the performance of the compensation consultant. The compensation committee has discretion to engage and terminate the services provided by the compensation consultant, subject to formal approval by the board of directors.




At its meeting in October 2019, the compensation committee assessed the independence of Compensia pursuant to SEC and Nasdaq rules and the board of directors concluded that no conflict of interest exists that would prevent Compensia from serving as an independent consultant to the compensation committee.
Role of Chairman and Chief Executive Officer
Mr. Rudelle and, after November 25, 2019, Ms. Clarken, attended compensation committee meetings and worked with the chair of the compensation committee and its compensation consultant to develop compensation recommendations for the executive officers (excluding Mr. Rudelle and Ms. Clarken), based upon individual experience and breadth of knowledge, individual performance during the year and other relevant factors. The recommendations of individuals holding the positions of chairman and Chief Executive Officer are reviewed and considered with other applicable information by the compensation committee, which then makes a recommendation to the board of directors. The compensation committee works directly with its compensation consultant to recommend to the board of directors compensation actions for individuals holding the position of chairman and Chief Executive Officer. In accordance with Nasdaq rules, individuals holding the positions of chairman and Chief Executive Officer are not present during deliberations or voting concerning their own compensation.
Use of Competitive Market Data
The compensation committee draws on a number of resources to assist in the evaluation of the various components of the Company’s executive compensation program, including an evaluation of the compensation practices at peer companies. The compensation committee uses data from this evaluation to assess the reasonableness of compensation and ensure that our compensation practices are both competitive in the marketplace and reasonable.
Our peer companies in 2019 were provided to the compensation committee by Compensia, then selected by the compensation committee and subsequently approved by the board of directors. Each year, the compensation committee reviews our peer group with the assistance of the compensation consultant and updates the peer group as appropriate. The companies comprising the peer group for 2019 were selected on the basis of their comparability to Criteo in terms of broad industry (software and services companies focused on digital media/advertising in the United States and software/technology companies more broadly in Europe, given the more limited number of comparable companies in the European market), geographic location, market capitalization, financial attributes (including revenue, revenue growth, comparable gross margin and cash flow) and number of employees.
Based on this evaluation, the compensation committee selected the peer companies in the following table for 2019. Given the Company’s unique position as a French company publicly-listed on the Nasdaq Global Market in the United States with certain executives based in Europe, the compensation committee determined that it was appropriate to develop both U.S. and international peer groups. The peer companies generally had revenues between half and two times the Company’s revenue, and market capitalization between half to three times the Company’s market capitalization.
U.S. Peers:
Blackbaud
j2 Global
Shutterfly
Cloudera
MicroStrategy
Tableau Software
Cornerstone OnDemand
Nutanix
Verint Systems
Endurance International
Pandora Media
Yelp
Fair Isaac
Paylocity Holding
Zynga
FireEye
QAD
 
HubSpot
RealPage
 
European Peers:
Auto Trader Group
Luxoft Holding
Talend S.A.
Cimpress N.V.
Playtech
Travelport Worldwide
Delivery Hero
Rightmove
trivago
InterXion Holding N.V.
Scout24
 
Just Eat
Sophos Group
 
Changes to our peer group from 2018 to 2019 include the addition of Blackbaud, Cloudera, Hubspot, Microstrategy, and QAD, and the removal of GoDaddy, Grubhub, and Zillow, resulting in a peer group that we believe is closer to Criteo’s financial and value criteria.
In addition to reviewing data drawn from these peer groups, the compensation committee also reviews competitive compensation data from broader Radford technology survey cuts and Compensia databases. To assist the Company in making its executive compensation decisions for 2019, Compensia evaluated competitive market practices, considering base salary, target




annual incentives as a percentage of base salary, target total cash compensation, target annual long-term incentive grant date fair values, equity award mixes, equity award structures and target total direct compensation.
In general, our board of directors seeks to set executives’ total cash compensation (base salary plus target annual incentive bonus) and long-term incentive compensation at levels that are competitive with our peers (based on its review of the compensation data for executives with similar roles in the Company’s peer groups) and, in the case of long-term incentive compensation, at a level great enough to ensure deep alignment of our executive officers’ interests with those of our shareholders.
However, the compensation committee does not formally “benchmark” our executive officers’ compensation to a specific percentile of our peer group. Instead, it considers competitive market data as one factor among many in its deliberations. The compensation committee exercises independent judgment in determining appropriate levels and types of compensation to be paid based on its assessment of several factors, including recommendations of the chairman and the Chief Executive Officer with respect to the compensation of executive officers (other than their own compensation), Company and individual performance, perceived criticality, retention objectives, internal fairness, current compensation opportunities as compared with similarly situated executives at peer companies (based on review of competitive market analyses prepared by its compensation consultant) and other factors as it may deem relevant.
The chart below is based on the peer data reviewed by our compensation committee in setting target compensation levels for our current Chief Executive Officer, our former Chief Executive Officer and our Chief Financial Officer for fiscal year 2019 and shows a comparison, for illustrative purposes, of the elements of fiscal year 2019 target total compensation for each Chief Executive Officer and our Chief Financial Officer against chief executive officer and chief financial officer compensation for our U.S. peer group.
We have chosen to present this data for our current Chief Executive Officer, our former Chief Executive Officer and our Chief Financial Officer only, rather than all of our named executive officers, because chief executive officer and chief financial officer are the two roles for which our compensation committee has access to the most comparable company data, and because these are the two roles most responsible for setting our strategic direction and articulating it to financial markets and investors (and therefore for which alignment of interests with shareholders is most important). We chose to present only the comparison against the U.S. peer group because our U.S. peer group consists of companies with which we are most likely to compete for talent, and is therefore the more important of the two peer groups in our compensation committee’s analysis.
In the chart below, “Total Cash” consists of each executive officer’s base salary and target bonus under the Criteo Executive Bonus Plan (“EBP”) (as further discussed under “—Elements of Executive Compensation Program—Annual Incentive Bonus” below), which, for fiscal year 2019, was greater than the bonus each executive actually earned under our EBP. “Equity Value” includes the combined aggregate grant date fair value of each award at target, and therefore assumes that all PSUs have been earned under the applicable performance criteria. As discussed above, for 2019, 50% of the shares subject to our named executive officers’ 2019 PSU awards were earned. Additionally, in 2019, our board of directors made a special supplemental grant of RSUs to Messrs. Rudelle, Fouilland and Teodosiu and Ms. Spilman, in order to reward each individual’s performance and go-forward criticality and to help achieve retention objectives with respect to executives based on review of their existing equity retention profiles as impacted by a 0% payout of 2018 PSUs and the “underwater” status of all outstanding option awards. The RSUs granted to Ms. Spilman and Mr. Teodosiu were forfeited upon their respective departures from the Company. In the case of Ms. Clarken, the value of each element of compensation in the table below is greater than the compensation she actually received in 2019—the chart below shows the compensation that an individual in the Chief Executive Officer position would have received for the entirety of 2019, whereas Ms. Clarken only began serving as our Chief Executive Officer on November 25, 2019. For more information on the specific elements of compensation to each of our executives, please see “Compensation Tables—Summary Compensation Table.”
CURRENT CEO
 
 
 
in thousands of U.S. dollars unless indicated otherwise
 
 
CRTO FY19 Target
U.S. Market Percentile
CRTO FY19 Realizable Pay
Base Salary
$650
60%
$650
Total Cash
$1,300
60%
$1,300
Equity Value
$4,944
40%
$2,484
Target Total Pay
$6,244
40%
$3,784
Excludes sign-on bonus
 
 




FORMER CEO
 
 
 
in thousands of U.S. dollars unless indicated otherwise
 
 
CRTO FY19 Target
U.S. Market Percentile
CRTO FY19 Realizable Pay
Base Salary
$555
50%
$555
Total Cash
$1,109
55%
$995
Equity Value
$8,146
75%
$5,425
Target Total Pay
$9,255
75%
$6,420

CFO
 
 
 
in thousands of U.S. dollars unless indicated otherwise
 
 
CRTO FY19 Target
U.S. Market Percentile
CRTO FY19 Realizable Pay
Base Salary
$448
50%
$448
Target Total Cash
$784
75%
$715
Equity Value
$3,806
>75%
$2,535
Target Total Pay
$4,590
>75%
$3,249
For illustrative purposes only, we have also included realizable pay for 2019 for each of our current Chief Executive Officer, former Chief Executive Officer and Chief Financial Officer, which includes, in each case, (1) base salary, (2) total cash including actual earned cash bonus for 2019 under our EBP (as disclosed in the Summary Compensation Table) and (3) the actual intrinsic value, as of December 31, 2019, of the equity awards granted to the executive in 2019. For PSUs, this amount is an aggregate of $1,806,231 for both Messrs. Rudelle and Fouilland because only 50% of the PSUs awarded in 2019 were earned. For RSUs, this amount is an aggregate of $8,338,953 for both Messrs. Rudelle and Fouilland. For Ms. Clarken’s stock options, this amount reflects the spread between our closing stock price on December 31, 2019, and the exercise price of such options multiplied by the number of Ordinary Shares underlying such options. For 2019, this amount is $0 for Ms. Clarken, our only named executive officer to receive stock options in 2019, because all of the stock options granted during 2019 had an exercise price that was higher than the fair market value of the ordinary shares and thus were “out-of-the-money” at year-end. For more information on realizable pay, please see “—Realizable Pay for 2019.”
Prior Year Say-On-Pay Results
Our executive compensation program received significant shareholder support and was approved, on a non-binding advisory basis, by 92.7% of the votes cast at the 2019 Annual General Meeting. We value feedback from our shareholders on our executive compensation program and corporate governance policies and welcome input, as it impacts our decision-making. We believe that ongoing engagement builds mutual trust with our shareholders and we will continue to monitor feedback from our shareholders and may solicit outreach on our programs, as appropriate. At the 2016 Annual General Meeting, shareholder votes expressed a preference for the say-on-frequency proposal to hold an advisory vote to approve executive compensation on an annual basis. In light of this vote, the Company’s board of directors determined that the Company will continue to hold an advisory vote to approve executive compensation on an annual basis until the next required say-on-frequency vote, which will be held at the 2022 Annual General Meeting.
In 2019, Criteo’s management team continued to frequently engage with the investment community, hosting and participating in almost 300 in-person meetings, including during roadshows and conferences as well as phone calls. Shareholders we spoke to jointly represented approximately 68% of floating shares as of December 31, 2019. In such engagements, Criteo’s executive compensation program was a common discussion topic and investors’ feedback and suggestions on such program were regularly heard and taken into consideration. In our shareholder outreach specific to the 2019 Annual General Meeting, Criteo’s management team spoke directly with 50% of its top-40 shareholders, jointly owning approximately 50% of shares. Based on feedback from our shareholders, our compensation committee and board of directors will consider potential shareholders’ concerns and take them into account in future determinations concerning compensation of our named executive officers.
Elements of Executive Compensation Program
In 2019, as in prior years, our executive compensation program consisted of three principal elements:
Base salary




Annual incentive bonus
Long-term incentive compensation

Base Salary
Base salary is the principal fixed element of an executive officer’s annual cash compensation during employment. The level of base salary reflects the executive officer’s skills and experience and is intended to be on par with other job opportunities available to such executive officer. Given the industry in which we operate and our compensation philosophy and objectives, we believe it is important to set base salaries at a level that is both competitive with our peer group in order to retain our current executives and reasonable, and to hire new executives when and as required. However, our review of the competitive market data is only one factor in setting base salary levels. In addition, the compensation committee also considers the following factors:
individual performance of the executive officer, as well as overall performance of the Company, during the prior year;
level of responsibility, including breadth, scope and complexity of the position;
years and level of experience and expertise and location of the executive officer;
internal review of the executive officer’s compensation relative to other executives to take into account internal fairness considerations; and
in the case of executive officers other than those holding the positions of chairman and Chief Executive Officer, the recommendations of the individuals holding the positions of chairman and Chief Executive Officer.
Base salaries for our executive officers are determined on an individual basis at the time of hire. Adjustments to base salary are considered annually based on the factors described above.
2019 Base Salaries
The base salaries of the named executive officers for 2018 and 2019, each in local currency and converted into U.S. dollars (on a constant currency basis for 2019), and the rationale for any base salary adjustment are set forth below:  
Name
 
Position(1)
 
2018 Base Salary (in local currency)
 
2019 Base Salary (in local currency)
 
2018 Base Salary
(in USD)(2)
 
2019 Base Salary at Constant Currency
(in USD)(2)
 
Rationale for Adjustment
Megan Clarken
 
Chief Executive Officer
 
N/A
 
$650,000

 
N/A
 

$650,000

 
Ms. Clarken began serving as our Chief Executive Officer on November 25, 2019. The amounts shown reflect the compensation she would have received if she had served for the full year. 

Ms. Clarken’s remuneration is solely for her role as Chief Executive Officer of Criteo Corp.




Jean-Baptiste Rudelle
 
Former Chief Executive Officer
 
€23,299 (services to Criteo S.A. as executive chairman, pro rated)
$27,290 (services to Criteo Corp. as executive chairman, pro rated)
€340,619 (services as Chief Executive Officer, pro rated)
 
€495,323

 
$457,087
 

$584,989

 
Until April 25, 2018, Mr. Rudelle served as executive chairman of the Company, which is reflected in the amounts shown in the table. In connection with Mr. Rudelle’s transition from executive chairman to Chief Executive Officer on April 25, 2018, his base salary was increased from $175,123 to €495,323 (or approximately $584,989) to reflect the change in role. Mr. Rudelle’s base salary was not increased from 2018 to 2019.
Benoit Fouilland
 
Chief Financial Officer
 

€350,000

 

€400,000

 
$
413,359

 
$
472,410

 
Base salary increase to recognize strong performance.
Ryan Damon
 
Executive Vice President, General Counsel & Corporate Secretary
 
$
415,000

 
$
415,000

 
$
415,000

 
$
415,000

 
Mr. Damon first became a named executive officer in 2019. Mr. Damon’s base salary was not increased from 2018 to 2019.
Mary Spilman
 
Former Chief Operating Officer
 
$
500,000

 
$
515,000

 
$
500,000

 
$
515,000

 
Ms. Spilman served as Chief Operating Officer until July 5, 2019. The amounts shown for 2019 reflect the compensation she would have received if she had served for the full year. 

Base salary increase to recognize market movement and to maintain a competitive salary position.
Dan Teodosiu
 
Former Chief Technology Officer
 

€325,000

 

€335,000

 
$
383,833

 
$
395,644

 
Mr. Teodosiu served as Chief Technology Officer until September 30, 2019. The amounts shown for 2019 reflect the compensation he would have received if he had served for the full year. 

Base salary increase to recognize market movement and to maintain a competitive salary position.

 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Refers to such named executive officer’s position at the end of 2019.
(2) 2018 base salaries have been converted from euros to U.S. dollars at a rate of €1.00 = $1.181026, which represent average exchange rates for the year ended December 31, 2018. 2019 base salaries are presented on a constant currency basis, using the 2018 average exchange rates set forth in the preceding sentence, for comparative purposes.
Annual Incentive Bonus
The Company provides our executive officers with the opportunity to earn annual cash bonus awards pursuant to the Criteo Executive Bonus Plan (the “EBP”), which are specifically designed to motivate our executive officers to achieve pre-established Company-wide goals set by the board of directors and to reward them for individual results and achievements in a given year.
The EBP is intended to provide structure and predictability regarding the determination of performance-based cash bonuses. Specifically, the EBP seeks to:
(i)
help attract and retain a high quality executive management team;




(ii)
increase management focus on challenging yet realistic goals intended to create value for shareholders;
(iii)
encourage management to work as a team to achieve the Company’s goals; and
(iv)
provide incentives for participants to achieve results that exceed Company goals.
Pursuant to the EBP, the annual cash bonus opportunities for our executive officers are approved on an annual basis by the board of directors. The Company goals, their relative weighting, and the relative weighting for each of the individual performance goals of the executive officers, if applicable, are also established by the board of directors at the beginning of the year, upon recommendation of the compensation committee, shortly after the board of directors has approved our annual operating plan.
Under the EBP, the board of directors has the discretion to determine the extent to which a bonus award will be adjusted based on an executive officer’s individual performance or such other factors as it may, in its discretion, deem relevant. An executive officer’s bonus award may be adjusted downward to zero by the board of directors based on a review of individual performance. The board of directors is not required to set individual qualitative goals for a given year.
2019 Annual Bonus Incentive
The performance measures and related target levels for the 2019 EBP, which reflected performance requirements set at the start of the year in the Company’s annual operating plan, were developed by the compensation committee and approved by the board of directors at meetings held in March 2019. For 2019, the board of directors, on recommendation from the compensation committee, set two shared quantitative goals applicable to all of the named executive officers (weighted 80%, collectively) and individual qualitative goals for each of our named executive officers (weighted 20%).
Quantitative Goals
The quantitative measures selected for the 2019 EBP were (i) Revenue ex-TAC growth, measured at constant currency, from 2018 to 2019, and (ii) Adjusted EBITDA (on an absolute basis but adjusted to remove the impact of currency fluctuations) achieved during 2019. These measures were selected by the board of directors because Revenue ex-TAC and Adjusted EBITDA are the key measures it uses to monitor the Company’s financial performance. In particular, our strategy focuses on maximizing the growth of our Revenue ex-TAC on an absolute basis over maximizing our near-term gross margin, as we believe this focus builds sustainable long-term value for our business by fortifying a number of our competitive strengths, including access to advertising inventory, breadth and depth of data and continuous improvement of the Criteo AI Engine’s performance, allowing it to deliver more relevant advertisements at scale. In 2019 (as in 2017 and 2018), the Revenue ex-TAC metric and Adjusted EBITDA metric were given equal weight. In setting the payout scale for both the Revenue ex-TAC portion and the Adjusted EBITDA portion of the quantitative goals, our compensation committee took into consideration the known and perceived challenges for Criteo and the overall advertising technology industry for 2019, which has resulted in a flattening of our earnings expectations for 2019 as well as a need to reinforce executive retention efforts, while remaining in line with market practices.
The payout scale on the Revenue ex-TAC portion of the quantitative goals was as follows, with Revenue ex-TAC growth measured, in each case, on a constant-currency basis:
If Revenue ex-TAC growth was positive by less than 5.4% in 2019 compared to 2018 (rounded up or down to the nearest tenth), the payout on the Revenue ex-TAC portion of the quantitative goals was between 50% and 100% of target;
If Revenue ex-TAC growth was positive by between the 5.4% target and the “stretch” 7.7% target, the payout on the Revenue ex-TAC portion of the quantitative goals was between 100% and 150% of target;
If Revenue ex-TAC growth was positive by more than the 7.75% stretch target but less than 10%, the payout on the Revenue ex-TAC portion of the quantitative goals was between 150% and 200% of target; and
If Revenue ex-TAC growth was positive by 10% or more, our executives could achieve the maximum payout on the Revenue ex-TAC portion of the quantitative goals, which was 200%.
The payout scale on the Adjusted EBITDA portion of the quantitative goals was as follows, in each case calculated on an absolute basis and excluding currency impacts:
If Adjusted EBITDA for 2019 was between $237 million and the $299 million target, the payout on the Adjusted EBITDA portion of the quantitative goals was between 50% and 100% of target;
If Adjusted EBITDA for 2019 was between the $299 million target and a $335 million “stretch” target, the payout on the Adjusted EBITDA portion of the quantitative goals was between 100% and 150% of target;
If Adjusted EBITDA for 2019 was above the $335 million stretch target but less than $370 million, the payout on the Adjusted EBITDA portion of the quantitative goals was between 150% and 200% of target; and
If Adjusted EBITDA for 2019 was $370 million or above, our executives could achieve the maximum payout on the Adjusted EBITDA portion of the quantitative goals, which was 200%.




The quantitative goals set forth herein and the achievement levels for such goals were designed to ensure proper alignment between our executive bonus plan provisions and the internal 2019 financial plan supporting the guidance that we published at the beginning of fiscal year 2019.
The chart below sets forth the quantitative goals for 2019 and the achievement levels for such goals, as well as actual Company performance for 2019 against which executive performance was measured. As shown below, year-over-year Revenue ex-TAC growth was 0.3% at constant currency, resulting in a 52.8% payout for the Revenue ex-TAC portion of the quantitative goals, and Adjusted EBITDA was $293.7 million, resulting in a payout of 95.7% on the Adjusted EBITDA portion of the quantitative goals.
 
 
 
 
 
 
 
Performance Measure
 
Weight
 
 
50%
 
100%
150%
200%
 
Actual
2019 Revenue ex-TAC growth at constant currency
 
40%
 
 
0%
 
5.4%
7.75%
≥10%
 
0.3%
2019 Adjusted EBITDA on an absolute and constant currency basis
 
40%
 
 
$237 million
 
$299 million
$335 million
≥$370 million
 
$293.7 million
 
 
 
 
 
 
 
 
 
 
 
 
Qualitative Goals
In addition, the board of directors selected individual qualitative goals for each of the named executive officers that were aligned to strategic performance objectives for those individuals. The qualitative goals were weighted 20% for each named executive officer and were subject to a maximum payout of 200% of the applicable portion. Some variation applied from named executive officer to named executive officer and from goal to goal. These qualitative goals for 2019 were set in March 2019, and the compensation committee develops these goals with the intent to be rigorous and difficult to achieve. The qualitative goals for 2019 included: (i) for Mr. Rudelle, making self-service the center of our product and go-to-market strategy, growing our new products to diversify outside of retargeting, and promoting operational excellence, making Criteo smarter and faster; (ii) for Mr. Fouilland, ensuring robust forecasting and budget management, safeguarding delivery of the self-service initiative through adequate program governance and close monitoring, and enabling the execution of the operational excellence program in S&O and the activation of productivity levers in R&D; (iii) for Mr. Damon, building a legal operations function and implementing contracts management processes, updating internal legal policies and procedures, show at least one tangible success from the government affairs team, and become a more business-focused, results-oriented legal team; (iv) for Mr. Teodosiu, ensuring objectives, key results and staffing are aligned with product priorities, increasing speed of delivery and efficiency, and showing returns on investment from Criteo AI Lab by the end of the year and defining its 2020 mission and structure and (v) for Ms. Spilman, an accelerated rollout of new products, a self-service transformation and updates to the Retail Media business. Ms. Clarken did not have qualitative goals for 2019, as she joined the Company on November 25, 2019. In connection with Ms. Clarken’s recruitment to Criteo, Ms. Clarken’s management agreement provided that her annual bonus payment for 2019 would be no less than her target bonus, prorated for the period of 2019 following her effective date.
2019 Annual Cash Bonus Payouts
The board of directors approved annual incentive bonus awards for each named executive officer under the 2019 EBP as follows:
Name
 
Bonus Target as % of Base Salary(1)
 
Quantitative Goals Achievement
(80%)
 
Qualitative Goals Achievement
(20%)
 
Funding Multiplier as % of Target
 
Actual Payout Amount(2)
 
Jean-Baptiste Rudelle
 
100%
 
74.3%
 
100%
 
79.44%
 
$470,505
 
Megan Clarken
 
100%
 
N/A
 
N/A
 
N/A
 
$65,890
 
Benoit Fouilland
 
75%
 
74.3%
 
100%
 
79.44%
 
$284,969
 
Ryan Damon
 
50%
 
74.3%
 
100%
 
79.44%
 
$164,838
 
Mary Spilman(3)
 
100%
 
N/A
 
N/A

 
N/A

 
N/A
 
Dan Teodosiu(3)
 
60%
 
N/A

 
N/A

 
N/A

 
N/A
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Bonus targets as a percentage of base salary for the named executive officers did not change from 2018 to 2019.
(2) Certain amounts have been converted from euros to U.S. dollars at a rate of €1.00 = $1.119574, which represents the average exchange rate for the year ended December 31, 2019.
(3) Ms. Spilman and Mr. Teodosiu did not receive annual incentive payouts in respect of 2019.




Long-Term Incentive Compensation
Long-term incentive compensation in the form of equity awards is an important tool for the Company to attract industry leaders of the highest caliber in the technology industry and to retain them for the long term. The majority of our named executive officers’ target total direct compensation opportunity in 2019 was provided in the form of long-term equity awards (92% of total compensation for Ms. Clarken, and 86% on average for Messrs. Rudelle and Fouilland). We use equity awards to align our executive officers’ financial interests with those of our shareholders by motivating them to assist with the achievement of both near-term and long-term corporate objectives.
Historically, the board of directors only granted stock options to employees. However, following a change to the tax treatment of RSUs under French law (the enactment of the Loi Macron, in 2018 the board of directors, after careful review by the compensation committee, decided to add RSUs to the Company’s equity compensation program for certain employees, including executive officers at the discretion of the board of directors, and PSUs to the Company’s equity compensation program for executive officers and managers and certain other employees. In October 2015, the Company’s shareholders approved: (i) a general plan (as such plan has been amended, the “Amended and Restated 2015 Time-Based RSU Plan”) providing for the grant of time-based RSUs to employees of the Company, and (ii) a performance-based plan (as such plan has been amended, the “Amended and Restated 2015 Performance-Based RSU Plan”) providing for the grant of PSUs, subject to the achievement of performance goals and time-based vesting, to the executive officers and certain other members of management and employees of the Company, as determined by the board of directors.
In 2019, we granted RSUs and PSUs to our executive officers, as well as, in the case of Megan Clarken, stock options. Stock options provide our executive officers with realizable value over time only if our shareholders also realize value after the date the options are granted. RSUs and PSUs provide an appropriate balance between addressing retention objectives and driving corporate performance.
In addition to the initial equity award that each executive officer receives upon being hired, the board of directors also grants some or all of our executive officers additional equity awards each year as part of our annual review of our executive compensation program. The eligibility for, and size of, any additional equity award to each of our executive officers are determined on a discretionary basis taking into account the following factors:
each executive officer’s individual performance assessment, the results and contributions delivered during the year, as well as his or her anticipated potential future impact;
delivering equity values that are competitive, yet reasonable, when compared to the equity values delivered by the companies in our peer group to their executives with similar responsibility;
the size and vesting schedule of existing equity awards in order to maximize the long-term retentive power of additional awards;
the size of each executive officer’s total cash compensation opportunity;
the Company’s overall performance relative to corporate objectives; and
the Company’s overall equity pool for the year.

Based on the foregoing factors, the board of directors, upon recommendation of the compensation committee, determined that the regular 2019 long-term incentive compensation to be granted to each of our executive officers should consist of a mix of RSUs and PSUs. In addition, the board of directors determined to grant stock options to Megan Clarken as part of her inducement equity grant when she joined the Company in the fourth quarter of 2019. As in prior years, a significant portion of the compensation awarded to our named executive officers will remain performance based, although an exception was made in connection with the initial inducement awards granted to Ms. Clarken in connection with her recruitment.
The table below sets forth the equity awards granted by the board of directors to our named executive officers in 2019:  




Name
 
Shares Issuable Upon Exercise of Stock Options Granted in 2019
 
Shares Issuable Upon Vesting of PSUs Granted in 2019(1)
Shares Issuable Upon Vesting of RSUs Granted in 2019
Jean-Baptiste Rudelle
 
–(2)
 
111,458
257,291
Megan Clarken
 
375,467
 
–(3)
143,308
Benoit Fouilland
 
–(2)
 
52,083
120,208
Ryan Damon
 
–(2)
 
–(4)
(4)
Mary Spilman
 
(2)
 
(5)
(5)
Dan Teodosiu
 
–(2)
 
–(5)
(5)
 
 
 
 
 
 
(1) The amounts of PSUs set forth in this column show the amounts originally granted to our named executive officers. As set forth below, only 50% of the shares subject to 2019 PSU awards to our named executive officers were earned.
(2) In connection with her recruitment to Criteo, Ms. Clarken was the sole named executive officer to receive an award of stock options during 2019.
(3) Ms. Clarken did not receive an award of PSUs in 2019, as she joined the Company in November 2019.
(4) Mr. Damon did not receive an equity grant in 2019.
(5) The PSU and RSU awards granted to Ms. Spilman and Mr. Teodosiu in 2019 were forfeited upon their termination of employment with the Company.
Vesting of Stock Option Grants
To aid in retention, Ms. Clarken’s stock option awards have a four-year vesting period, with one quarter of the award vesting on the first anniversary of the date of grant and the remainder vesting in 12 equal quarterly installments thereafter, subject to the recipient’s continued employment with the Company.
Performance Conditions and Vesting of PSU Grants
Our Ordinary Shares subject to the PSUs granted to the named executive officers were to be earned contingent upon the attainment of 2019 Gross Revenue and Free Cash Flow goals set by the board of directors in the first quarter of 2019.
Achievement in Gross Revenue and Free Cash Flow are important metrics used by the board of directors to measure the Company’s financial performance and creation of shareholder value given our current development stage, the significant growth opportunities ahead of us and the significant impact that high Gross Revenue and Free Cash Flow can have on the Company’s profitability and cash generation given the scalability of our operating model. As a result, given the increased focus that the Company is putting on profitability and cash flow generation, the compensation committee and board of directors determined that growth in these two metrics, with a 50% weighting on Gross Revenue and a 50% weighting on Free Cash Flow, was, unlike in prior years, the appropriate performance measure for the 2019 PSU awards. Our compensation committee and board of directors believe that setting a one-year performance measurement period was appropriate at this stage in the Company’s development, due to the historically steep trajectory of our top-line revenue growth and the risk of setting inappropriate targets if we were to project more than one year in advance. This approach was balanced by the four-year vesting schedule to which any earned PSUs are subject, as discussed below. Our 2019 Free Cash Flow target, described below, represents an approximately 40% conversion rate of the Adjusted EBITDA target for the year, generally in line with the average conversion rate for prior years.




The following table sets forth the 2019 Gross Revenue goal for the 2019 PSU awards.
2019 Gross Revenue
 
Percentage of PSUs Earned(1)
$2,286 million
 
50% (Threshold)
$2,410 million
 
100% (Target)
(1) Achievement is linear for Gross Revenue growth between tranches, and paid to one decimal point. Achievements below the threshold and above the maximum are rounded up or down accordingly, and capped at 100%.
The following table sets forth the 2019 Free Cash Flow goal for the 2019 PSU awards.
2019 Free Cash Flow
 
Percentage of PSUs Earned
$60 million
 
50% (Threshold)
$113 million
 
100% (Target)
Actual 2019 Gross Revenue was $2,262 million, which was below the Gross Revenue threshold for the year. As a result, 0% of the Ordinary Shares subject to our named executive officers’ 2019 PSU awards based on Gross Revenues were earned. Actual 2019 Free Cash Flow was $124.9 million, which was in excess of the Free Cash Flow target for the year. As a result, 100% of the Ordinary Shares subject to our named executive officers’ 2019 PSU awards based on Free Cash Flow were earned, and a total of 50% of the Ordinary Shares subject to our named executive officers’ 2019 PSU awards for both Gross Revenues and Free Cash Flow were earned.
Our compensation committee and board of directors also believe that a time-based vesting requirement for any earned PSUs is important to provide additional retention incentives and longer term alignment with our shareholders. The PSUs earned with respect to 2019 are subject to a four-year vesting schedule, with half of any earned PSUs vesting on the second anniversary of the grant date and the remainder vesting in eight equal quarterly installments thereafter, which quarterly vesting would be subject to the recipient’s continued employment with the Company. As a result, none of the PSUs granted to the named executive officers for 2019 will vest until April 2021 at the earliest.
Vesting of RSU Grants
Our standard RSU grants have a four-year vesting schedule, with 50% of the award vesting on the second anniversary of the date of grant, and the remainder vesting in equal quarterly installments thereafter over the subsequent two-year period.
Retention Efforts in 2019
In light of several perceived challenges and changes for Criteo and the overall advertising technology industry in recent years, we have placed additional emphasis on the retention of our senior executives, who offer unique and insightful experience in both the industry and in Criteo specifically. To aid in retention of our executives during this challenging time, certain of our 2019 RSU grants to certain named executive officers had a four-year vesting schedule, with 70% of the award vesting on the second anniversary of the date of grant, and the remainder vesting in equal quarterly installments thereafter over the subsequent two-year period.
To enhance our retention of Mr. Teodosiu and promote corporate performance, Mr. Teodosiu was granted a retention award in July 2018 that generally provided for the lump-sum payment of €200,000 (equivalent to $223,914.80 at a rate of €1.00 = 1.119574, which represents average exchange rates for the year ended December 31, 2019), payable on October 31, 2019, subject to continued employment through such retention date. We mutually agreed with Mr. Teodosiu to accelerate payment of this retention award in connection with his separation from the Company in September 2019.




Share Ownership and Equity Awards
As discussed above, long-term incentive compensation in the form of equity awards is an important tool for the Company to attract industry leaders of the highest caliber in the global technology industry and to retain them for the long term. The majority of our named executive officers’ target total direct compensation opportunity in 2019 was provided in the form of long-term equity awards (92% of total compensation for Ms. Clarken, and 86% on average for Messrs. Rudelle and Fouilland). We use equity awards to align our executive officers’ financial interests with those of our shareholders by motivating them to assist with the achievement of both near-term and long-term corporate objectives.
As a result, each of our named executive officers accumulates substantial exposure to our stock price, which, when coupled with time- and performance-based vesting, we believe results in strong alignment of our executives’ interests with those of our shareholders. Furthermore, our insider trading policy prohibits short sales, trading in derivative instruments and other inherently speculative transactions in our equity securities by our employees and related persons.
Share Ownership Requirements
On December 11, 2019, our board of directors adopted share ownership guidelines for the chairman of our board of directors and our Section 16 executive officers, under which (i) our Chief Executive Officer is required to acquire and own securities in an amount equal to the lesser of (a) 200,000 shares or (b) five times her annual base salary, (ii) all other Section 16 executive officers are required to acquire and own securities in an amount equal to the lesser of (a) 45,000 shares or (b) two times their annual base salary and (iii) the chairman of our board of directors is required to acquire and own securities in an amount equal to two times his annual cash remuneration, including directors’ fees. The chairman and Section 16 officers are required to meet the applicable ownership requirements within five years of becoming subject to them. If required share ownership is not satisfied within five years, the individual must retain 100% of any shares resulting from exercised options or vested restricted stock units, net of any amounts required to pay taxes and exercise prices, until the guidelines are met.
In addition to these share ownership guidelines, our board of directors require that 1% of the shares resulting from the exercise of stock options or received upon the vesting of RSUs or PSUs by our chairman (if applicable), Chief Executive Officer and Deputy Chief Executive Officers (“directeurs généraux délégués”) be held by such persons until the termination of their respective offices. For 2019, Mr. Rudelle was our chairman of our board of directors and, until November 25, 2019, our Chief Executive Officer. From November 25, 2019 through the end of the year, Ms. Clarken was our Chief Executive Officer. Mr. Fouilland was our Deputy Chief Executive Officer.
The table below shows the total exposure that each of our named executive officers (other than Mr. Teodosiu and Ms. Spilman) had to Criteo’s stock as of March 31, 2020, including both vested and unvested equity awards.
Name
Ordinary Shares and ADSs (1)
Securities underlying option awards (2)
Securities underlying RSU and PSU awards (3)
Total
Jean-Baptiste Rudelle
59,337

830,361
373,342
1,263,040
Megan Clarken

375,467
143,308
518,775
Benoit Fouilland
55,211

449,034
179,056
683,301
Ryan Damon

65,500
111,434
176,934
 
 
 
 
 
 
 
Total for all named executive officers:
2,642,050
 
 
 
 
 
(1) The amounts shown in this column reflect securities beneficially owned by each of our named executive officers, determined in accordance with the applicable rules of the SEC, other than (i) Ordinary Shares issuable upon the exercise of share options and warrants that are immediately exercisable or exercisable within 60 days after March 31, 2020 (which are included in the “Securities underlying equity awards” column), and (ii) Ordinary Shares issuable upon the vesting of RSUs or PSUs within 60 days after March 31, 2020 (which are included in the “Securities underlying RSU and PSU awards” column). For more information about the beneficial ownership of our securities, please see “Ownership of Securities.”
(2) The amounts shown in this column reflect stock options that have vested and are exercisable, as well as those that have not yet vested. For more information on grant dates, vesting schedules, exercise prices and expiration dates of option awards held by our named executive officers as of December 31, 2019, please see “Compensation Tables—Outstanding Equity Awards at 2019 Fiscal Year End.”
(3) The amounts shown in this column reflect RSUs, as well as PSUs that have been determined by our board of directors to have been earned by the applicable named executive officer pursuant to the applicable performance criteria. For more information on the PSUs held by each of our named executive officers as of December 31, 2019, please see “Compensation Tables—Outstanding Equity Awards at 2019 Fiscal Year End.” For more information on the performance criteria applicable to PSU awards, please see “—Long-Term Incentive Compensation.”
Other Compensation Information
Employee Benefit Programs
Each of our executive officers is eligible to participate in the employee benefit plans available to our employees in the country in which they are employed, including medical, dental, group life and disability insurance, in each case on the same basis as other employees in such country, subject to applicable law. We also provide vacation and other paid holidays to all employees, including executive officers, all of which we believe to be comparable to those provided at peer companies. These benefit programs are designed to enable us to attract and retain our workforce in a competitive marketplace. Health, welfare and vacation benefits ensure that we have a productive and focused workforce through reliable and competitive health and other benefits.
Our retirement savings plan for U.S. employees is a tax-qualified 401(k) retirement savings plan (the “401(k) Plan”), pursuant to which all employees, including any named executive officer employed by our U.S. subsidiary (Criteo Corp.), are able to contribute




certain amounts of their annual compensation, subject to limits prescribed by the Internal Revenue Code. In 2019, we provided a 100% matching contribution on employee contributions up to the first 3% of eligible compensation and a 50% matching contribution for the next 2% of eligible compensation. Mr. Damon and Ms. Spilman were the only named executive officers to participate in the 401(k) Plan in 2019.
Perquisites and Other Personal Benefits
We provide limited perquisites to our named executive officers. For more information on the perquisites and other personal benefits provided to our named executive officers, please refer to footnote (10) to the Summary Compensation Table in “Executive Compensation – Compensation Tables” included elsewhere in this proxy statement.
Timing of Compensation Actions
Compensation, including base salary adjustments, for our named executive officers is reviewed annually, usually in the first quarter of the fiscal year, and upon promotion or other changes in job responsibilities.
 Equity Grant Policy
We do not have, nor do we plan to establish, any program, plan or practice to time stock option grants in coordination with releasing material non-public information or any plan to reprice or extend any outstanding option awards.
Short Sale and Derivatives Trading Policy
As noted in more detail above under the caption “Anti-Hedging/Pledging Policy,” our insider trading policy prohibits short sales, trading in derivative instruments and other inherently speculative transactions in our equity securities by our employees and related persons.
Executive Compensation Recovery (“Clawback”) Policy
In April 2018, we adopted a “clawback” policy with respect to certain compensation earned by or paid to our executive officers after the effective date of the policy, which, to the extent permitted by applicable law, will allow us to recoup performance-based equity awards and cash bonuses from our Chief Executive Officer and certain other executive officers (including our named executive officers) if (i) the amount of any such incentive payments was based on the achievement of financial results that were subsequently the subject of an amendment or restatement, and the applicable incentive payment would not have been made to the executive officer based upon the restated financial results, or (ii) the executive engaged in misconduct.
Risks Related to Compensation Policies and Practices
As part of the board of directors’ risk oversight role, our compensation committee at least annually reviews and evaluates the risks associated with our compensation programs. The compensation committee has reviewed our compensation practices as generally applicable to our employees and believes that our policies do not encourage excessive and unnecessary risk-taking, and that the level of risk that they do encourage is not reasonably likely to have a material adverse effect on the Company. In making this determination, the compensation committee considered the following:
the Company’s use of different types of compensation vehicles to provide a balance of short-term and long-term incentives with fixed and variable components;
the granting of equity-based awards that are earned based on performance (in the case of executive officers) and subject to time-based vesting, which aligns employee compensation with Company performance, encouraging participants to generate long-term appreciation in equity values;
the Company’s annual bonus determinations for each employee being tied to achievement of Company goals, which goals seek to promote retention on behalf of the Company and to create long-term value for our shareholders; and
the Company’s system of internal control over financial reporting and code of business conduct and ethics, which among other things, reduce the likelihood of manipulation of the Company’s financial performance to enhance payments under any of its incentive plans.





COMPENSATION COMMITTEE REPORT
The compensation committee has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management. Based on such review and discussions, the compensation committee recommended to the board of directors that the Compensation Discussion and Analysis be included in this proxy statement.

THE COMPENSATION COMMITTEE
James Warner (Chair)
Edmond Mesrobian
Rachel Picard





COMPENSATION TABLES
Summary Compensation Table
The following Summary Compensation Table sets forth, for the three years ended December 31, 2019, 2018 and 2017, respectively, the compensation earned by (i) each individual who served as our Chief Executive Officer or Chief Financial Officer, (ii) our additional executive officer serving as of December 31, 2019 and (iii) two additional former executive officers who would have been among the three most highly compensated executive officers of the Company other than the Chief Executive Officer and Chief Financial Officer had they continued to serve as of December 31, 2019 (collectively, our named executive officers).
Name and Principal Position (1)
 
Year
 
Salary
($)
 
Bonus
($)
 
Stock 
Awards
($)(7)(8)
 
Option 
Awards
($)(7)
 
Non-Equity 
Incentive 
Plan 
Compensation
($)(9)
 
All Other 
Compensation
($)(10)
 
Total
($)
Jean-Baptiste Rudelle (2)
 
2019
 
554,551

 

 
8,136,029

 

 
440,536

 
111,575

 
9,242,691

Former Chief Executive Officer
 
2018
 
457,086

 

 
2,823,625

 
2,819,652

 
241,279

 
281,340

 
6,622,982

 
 
2017
 
62,468

 

 
245 352

 
248,844

 
 51 099

 
75,612

 
683,375

Megan Clarken (3)
 
2019
 
65,890

 
300,000

 
2,514,156

 
2,429,699

 
65,890

 
75,000

 
5,450,635

Chief Executive Officer
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benoit Fouilland
 
2019
 
447,830

 

 
3,801,406

 

 
266,817

 
12,405

 
4,528,458

 Chief Financial Officer
 
2018
 
413,359

 

 
1,298,861

 
1,168,348

 
203,125

 
17,752

 
3,101,445

 
 
2017
 
387,207

 

 
1,128,620

 
1,144,683

 
237,552

 
14,617

 
2,912,679

Ryan Damon (4)
 
2019
 
415,000

 

 

 

 
164,838

 
139,190

 
719,028

 General Counsel
 
2018
 
173,959

 
100,000

 
531,500

 
534,950

 
48,291

 

 
1,388,700

Mary Spilman (5)
 
2019
 
262,438

 

 
3,801,406

 

 

 
10,481

 
4,074,326

 Former Chief Operating Officer
 
2018
 
500,000

 

 
1,468,280

 
1,320,741

 
277,600

 
10,250

 
3,576,871

 
 
2017
 
480,000

 

 
883,268

 
895,839

 
416,640

 
10,650

 
2,686,397

Dan Teodosiu (6)
 
2019
 
280,522

 

 
2,849,924

 

 

 
909,765

 
4,040,211

 Former Chief Technology Officer
 
2018
 
383,833

 

 
1,298,861

 
1,168,348

 
127,863

 
1,903

 
2,980,808

 
 
2017
 
352,923

 

 
981,409

 
995,376

 
179,567

 
565

 
2,509,840

(1)
All amounts presented in the Summary Compensation Table, and in the supporting tables that follow, are expressed in U.S. dollars. Certain amounts payable to Messrs. Rudelle, Fouilland and Teodosiu were paid in euros. The average exchange rate used for the purpose of the Summary Compensation Table, and, unless otherwise noted, the supporting tables that follow, for the three years ended December 31, 2019, 2018 and 2017 is as follows:
Date
Euro to U.S. Dollar Conversion Rate
12/31/19
1.119574
12/31/18
1.181026
12/31/17
1.129354
(2)
From April 25, 2018 until November 25, 2019, Mr. Rudelle served as chairman and Chief Executive Officer of the Company. Mr. Rudelle ceased serving as our Chief Executive Officer on November 25, 2019. Mr. Rudelle received his base salary through December 31, 2019 until a new compensation arrangement was established in light of the change in his role.
(3)
Ms. Clarken became our Chief Executive Officer on November 25, 2019. Ms. Clarken received a sign-on bonus equal to $300,000, and received a relocation allowance of $75,000 in connection with her relocation from New York, NY to Paris, France.
(4)
Mr. Damon first became a named executive officer of the Company in 2019. In 2018, Mr. Damon received a sign-on bonus equal to $100,000.
(5)
Ms. Spilman ceased serving as our Chief Operating Officer effective July 5, 2019.
(6)
Mr. Teodosiu ceased serving as our Chief Technology Officer effective September 30, 2019.
(7)
The amounts reported in the “Stock Awards” and “Option Awards” columns reflect the aggregate grant date fair value of each award computed in accordance with ASC Topic 718. For information regarding the assumptions used in determining the fair value of an award, please refer to Note 20 of our Annual Report on Form 10-K as filed with the SEC on March 2, 2020. The amounts reported for 2017 and 2018 in the “Stock Awards” and “Option Awards” columns reflect the aggregate grant date fair value of each award computed in accordance with ASC Topic 718. For information regarding the assumptions used in determining the fair value of an award, for awards granted in 2017 and 2018, please refer to Note 18 of our Annual Report on Form 10-K as filed with the SEC on March 1, 2018, and Note 19 of our Annual Report on Form 10-K as filed with the SEC on March 1, 2019, respectively.
(8)
The amounts reported in the “Stock Awards” column represent the grant date fair value of the 2017, 2018 and 2019 PSU awards at target, which also reflects the maximum award.
(9)
The amounts reported in the “Non-Equity Incentive Plan Compensation” column represent the amount of the cash incentive bonus earned by our named executive officers for performance for the three years ended December 31, 2019, 2018 and 2017 under the EBP. See “Executive Compensation–Compensation Discussion and Analysis–Elements of Executive Compensation Program—Annual Incentive Bonus” for a discussion of the annual cash incentives earned by each named executive officer in respect of 2019.




(10)
The amounts reported in the “All Other Compensation” column for 2019 include unemployment insurance premiums and tax preparation and planning services for Mr. Rudelle and the benefits set forth in the table below. The incremental cost to the Company is based on premiums paid, amounts reimbursed by the Company to the executive and the cost to the Company of mobility benefits and severance-related payments.
    
Named Executive Officer
Unemployment Insurance Premiums
($)(a)
Life Insurance and Disability Benefit Plan Contributions
($)(b)
Defined Contribution Plan Contributions
($)(c)
Tax Reimbursements
($)(d)
Tax Preparation and Planning Services
($)(e)
Mobility Benefits
($)(f)
Relocation Allowance
($)(g)
Severance Payments
($)(h)
Jean-Baptiste Rudelle
33,723
77,852
Megan Clarken
75,000
Benoit Fouilland
6,932
5,473
Ryan Damon
6,095
53,399
79,697
Mary Spilman
10,481
Dan Teodosiu
909,765
(a)
As the chairman and former Chief Executive Officer of the Company, Mr. Rudelle was not entitled to receive state-provided unemployment benefits in the event of termination pursuant to French law. The amount listed in this column represents the cost to us of the premium payments in respect of the unemployment insurance policy obtained by us on Mr. Rudelle’s behalf to provide similar benefits to the state-provided unemployment benefits that Mr. Rudelle would have otherwise been eligible to receive, were he not the executive chairman or Chief Executive Officer, as applicable, in the event of a termination of his employment and $15,721.76 in social charges remitted to France by us pursuant to French law. See “—Potential Payments upon Termination or Change of Control” for a discussion of the severance benefits payable to Mr. Rudelle upon termination of employment.
(b)
Represents the cost to us in respect of Mr. Fouilland’s life insurance and disability plan, which consists of premium cost.
(c)
Represents the cost to us of our employer contributions to the 401(k) plan accounts of Mr. Damon and Ms. Spilman, who were the only eligible named executive officers who elected to participate in our 401(k) plan.
(d)
Represents Company-paid taxes in respect of Mr. Fouilland’s health and disability plan, and in respect of Mr. Damon’s taxable mobility benefits, respectively.
(e)
Represents the costs to us of tax preparation and planning services provided to Mr. Rudelle. We cover these costs to Mr. Rudelle due to the complex nature of his taxes, resulting in part from Mr. Rudelle’s relocation to multiple different countries as Criteo expanded in past years and due to the heavy equity component of Mr. Rudelle’s remuneration.
(f)
Represents mobility benefits paid by us to Mr. Damon. Mobility benefits include certain benefits that are available to international assignees in France.
(g)
Represents a $75,000 relocation allowance paid by us to Ms. Clarken in connection with her relocation from New York, NY to Paris, France.
(h)
Represents (i) $479,457 in severance paid to Mr. Teodosiu in connection with his termination with the Company, (ii) a $206,393 mutual agreement indemnity in settlement of all outstanding claims relating to the termination of Mr. Teodosiu with the Company and (iii) a retention bonus equal to $223,915.




Grants of Plan-Based Awards Table 2019
The following table sets forth the grants of plan-based awards to the named executive officers during the year ended December 31, 2019.
Name
 
 
 
Estimated Future Payouts Under 
Non-Equity Incentive Plan Awards 
(1)
 
Estimated Future Payouts Under 
Equity Incentive Plan Awards
(2)
 
All Other 
Stock 
Awards: 
Number of 
Shares of 
Stock or 
Units 
(#)(3)
 
All Other Option Awards: Number of Securities Underlying Options
(#)(4)
 
Exercise or Base Price of Option Awards
($/Sh)(4)
 




Closing Price on Date of Grant
($/Sh)(4)
 
Grant
Date Fair
Value of
Stock and
Option
Awards ($)(5)
 
Grant 
Date
 
Threshold
($)
 
Target
($)
 
Maximum
($)
 
Threshold
(#)
 
Target
(#)
 
Maximum
(#)
 
Jean-Baptiste Rudelle
 

 

 
554,551

 
1,109,102

 

 

 

 

 

 

 

 

 
 
4/24/19

 

 

 

 
27,865

 
111,458

 
111,458

 

 

 

 

 
2,459,195

 
 
4/24/19

 

 

 

 

 

 

 
257,291

 

 

 

 
5,675,835

Megan Clarken(6)
 

 

 
65,890

 
131,780

 

 

 

 

 

 

 

 

 
 
12/11/19

 

 

 

 

 

 

 

 
375,467

 
17.54

 
17.54

 
2,429,699

 
 
12/11/19

 

 

 

 

 

 

 
143,308

 

 

 
17.54

 
2,514,156

Benoit Fouilland
 

 

 
335,872

 
671,744

 

 

 

 

 

 

 

 

 
 
4/24/19

 

 

 

 
13,021

 
52,083

 
52,083

 

 

 

 

 
1,149,152

 
 
4/24/19

 

 

 

 

 

 

 
120,208

 

 

 

 
2,652,253

Ryan Damon
 

 

 
207,500

 
415,000

 

 

 

 

 

 

 

 

 
 

 

 

 

 

 

 

 

 

 

 

 

 
 

 

 

 

 

 

 

 

 

 

 

 

Mary Spilman
 

 

 
261,402

 
522,803

 

 

 

 

 

 

 

 

 
 
4/24/19

 

 

 

 
13,021

 
52,083

 
52,083

 

 

 

 

 
1,149,152

 
 
4/24/19

 

 

 

 

 

 

 
120,208

 

 

 

 
2,652,253

Dan Teodosiu
 

 

 
154,703

 
309,406

 

 

 

 

 

 

 

 

 
 
4/24/19

 

 

 

 
10,417

 
41,667

 
41,667

 

 

 

 

 
919,335

 
 
4/24/19

 

 

 

 

 

 

 
87,500

 

 

 

 
1,930,588

(1)
The amounts in the “Estimated Future Payouts Under Non-Equity Incentive Plan Awards” column represent each named executive officer’s annual cash incentive that could have been earned in respect of the annual cash incentive established in 2019 under the EBP. See “Executive Compensation–Compensation Discussion and Analysis–Elements of Executive Compensation Program—Annual Incentive Bonus” for a discussion of the annual cash incentives earned by each named executive officer for 2019.
(2)
On April 25, 2019, the named executive officers (other than Ms. Clarken and Mr. Damon) received a grant of PSUs under the Amended and Restated 2015 Performance-Based RSU Plan. Since the 2019 Revenue ex-TAC performance threshold was achieved but the target was not achieved, 50% of the PSUs were earned. Ms. Spilman and Mr. Teodosiu each forfeited their PSUs when their respective employment with the Company was terminated. See “Executive Compensation–Compensation Discussion and Analysis—Elements of Executive Compensation Program—Long-Term Incentive Compensation” for a discussion of the terms of the PSUs granted in 2019.
(3)
On April 25, 2019, the named executive officers (other than Ms. Clarken and Mr. Damon) received a grant of RSUs under the Amended and Restated 2015 Time-Based RSU Plan, 70% of which will vest on the two-year anniversary of the grant date, and the remainder will vest in equal portions at the end of each year during the two-year period thereafter. On December 11, 2019, Ms. Clarken received a grant of RSUs, 50% of which will vest on the two-year anniversary of the grant date, and the remainder will vest in equal portions at the end of each year during the two-year period thereafter. Ms. Spilman and Mr. Teodosiu each forfeited their RSUs when their respective employment with the Company was terminated. See “Executive Compensation-Compensation Discussion and Analysis-Elements of Executive Compensation Program-Long-Term Incentive Compensation” for a discussion of the terms of the RSUs granted in 2019.
(4)
Ms. Clarken received a grant of stock options under the 2016 Stock Option Plan on December 11, 2019, as described in “Executive Compensation–Compensation Discussion and Analysis—Elements of Executive Compensation Program—Long-Term Incentive Compensation.” 25% of the stock options will vest on the first anniversary of the date of grant and the remainder will vest in 16 equal quarterly installments thereafter, based on continued employment. Pursuant to our 2016 Stock Option Plan, the exercise price of a stock option is set at the higher of (i) the closing price on the day prior to the grant date, and (ii) 95% of the average closing price during the 20 trading days prior to the grant date. This pricing formula may result in an exercise price that is greater than or less than the closing price on the date of grant. The column titled “Closing Price on the Date of Grant” is provided pursuant to SEC disclosure requirements, where the exercise price of a stock option is less than the closing price of the underlying stock on the date of grant.
(5)
Represents the grant date fair value, measured in accordance with ASC Topic 718, of stock option awards, PSU awards and RSU awards made in 2019. Grant date fair values are calculated pursuant to assumptions set forth in Note 20 of our Annual Report on Form 10-K as filed with the SEC on March 2, 2020.
(6)
The annual bonus granted to Ms. Clarken was prorated at target for her period of service during 2019, as shown in the Summary Compensation Table.




Executive Employment Agreements
We have entered into an offer letter agreement or employment agreement with each of the named executive officers, the material terms of which are described below. Each of the agreements with our named executive officers is for an indefinite term. The provisions of these arrangements relating to termination of employment are described under “Potential Payments Upon Termination or Change of Control” below. See “Executive Compensation–Compensation Discussion and Analysis–Elements of Executive Compensation Program” for a discussion of the elements of compensation of each of the named executive officers for the year ended December 31, 2019.
Ms. Clarken
Criteo S.A. and Criteo Corp. have entered into a management agreement with Ms. Clarken, as amended, in connection with her recruitment to Criteo. The management agreement, as amended, provides that Ms. Clarken will receive an annual base salary of $650,000 and will be eligible to receive a target annual bonus opportunity equal to 100% of her base salary, and a maximum annual bonus opportunity equal to 200% of her base salary. The annual bonus opportunity pursuant to the Criteo Executive Bonus Plan will be based on the financial performance of Criteo S.A. and Criteo Corp. and the assessment by the board of individual performance; provided that, Ms. Clarken’s annual bonus payment with respect to Criteo’s 2019 fiscal year would be no less than her target bonus, prorated for the period of such year following her start date. Ms. Clarken’s remuneration is in respect of her role as Chief Executive Officer of our wholly-owned subsidiary, Criteo Corp.
The management agreement also provided that Ms. Clarken would receive a sign-on bonus equal to $300,000 on the first regularly scheduled payroll date following her start date. Ms. Clarken will be required to repay to the Company the sign-on bonus if she voluntarily resigns other than for Good Reason (as described below in “—Potential Payments upon Termination or Change of Control”) or her employment is terminated by Criteo Corp. for Cause, in either case, during the 12-month period immediately following her start date.
In connection with her relocation from the United States to Paris, France, Criteo Corp. agreed to reimburse Ms. Clarken for certain expenses up to $75,000, in accordance with the Company’s relocation policy approved by the board and revised by it during its meeting held on March 3, 2020, including airfare for Ms. Clarken and her spouse, furniture and household moving expenses, incidentals and the cost of temporary housing for up to two months. The Company also agreed to provide Ms. Clarken with (i) reasonable tax assistance services, (ii) reasonable immigration assistance services for Ms. Clarken and her spouse, (iii) the cost of airfare for Ms. Clarken and her spouse for up to three visits to Ms. Clarken’s home country per calendar year and (iv) a monthly housing allowance equal to $5,000 per month (or the equivalent amount in euros) after taxes. No amounts were paid under the arrangement during 2019.
Additionally, Ms. Clarken received an initial inducement grant of (i) 143,308 time-based RSUs and (ii) 375,467 stock options.
Pursuant to the management agreement, Ms. Clarken is subject to customary restrictive covenants provided by Criteo Corp.’s protective covenants agreement, including a requirement not to compete with the Company and its affiliates anywhere in the world for a period of 12 months after termination of employment.
Mr. Rudelle
Mr. Rudelle is not party to an employment agreement with Criteo S.A. Prior to August 1, 2014, Mr. Rudelle served exclusively as the Chief Executive Officer and chairman of Criteo S.A. Effective August 1, 2014, and in addition to continuing to serve as our chairman and Chief Executive Officer, Mr. Rudelle became the Chief Executive Officer of Criteo Corp., our wholly-owned U.S. subsidiary. In connection with his appointment to the position of Chief Executive Officer of Criteo Corp., we entered into an at-will offer letter agreement with Mr. Rudelle. Under the terms of his offer letter agreement, for the year ended December 31, 2014, Mr. Rudelle was entitled to receive an annual base salary of $270,000 and a target annual bonus opportunity equal to 100% of his base salary, capped at 125% of the target amount, each subject to periodic review and adjustment. As of January 1, 2016, Mr. Rudelle transitioned from his role of Chief Executive Officer and chairman of the board of directors of Criteo S.A. and Chief Executive Officer of Criteo Corp. to the role of executive chairman. Mr. Rudelle again assumed the role of Chief Executive Officer effective April 25, 2018 until November 25, 2019. From November 25, 2019 through the remainder of fiscal year 2019, Mr. Rudelle served only as chairman of the board of directors of Criteo S.A. However, Mr. Rudelle continued to receive his Chief Executive Officer salary through December 31, 2019, during which time he assisted in the onboarding of Ms. Clarken.
Our board of directors determined that for the year ended December 31, 2019, Mr. Rudelle would receive an annual base salary of €495,323 (equivalent to approximately $554,550.75, converted into U.S. dollars pursuant to the exchange rate noted in footnote 1 to the Summary Compensation Table) and a target annual bonus opportunity equal to 100% of his base salary.
Mr. Fouilland
We entered into an employment agreement effective as of March 1, 2012 with Mr. Fouilland, our Chief Financial Officer. Under the terms of his employment agreement, for the year ended December 31, 2012, Mr. Fouilland was entitled to receive an annual base salary of €270,000, and an annual target bonus opportunity that was initially equal to 30% of his annual base salary.




In accordance with the periodic review and adjustment of base salary and target bonus opportunity set forth in Mr. Fouilland’s employment agreement, our board of directors determined that for the year ended December 31, 2019, Mr. Fouilland would be entitled to receive an annual base salary of €400,000 (equivalent to approximately $447,829.60, converted into U.S. dollars pursuant to the exchange rate noted in footnote 1 to the Summary Compensation Table), and an annual target bonus opportunity equal to 75% of his annual base salary.
Mr. Damon
We entered into an employment agreement effective as of August 1, 2018 with Mr. Damon, our General Counsel & Corporate Secretary. Under the terms of his employment agreement, for the year ended December 31, 2018, Mr. Damon was entitled to receive an annual base salary of $415,000, and an annual target bonus opportunity that was initially equal to 50% of his annual base salary.
Mr. Damon’s base salary adjustments and target bonus opportunities for the year ended December 31, 2019 were decided by Mr. Rudelle in his former role as Chief Executive Officer. Mr. Rudelle determined that for the year ended December 31, 2019, Mr. Damon would be entitled to receive an annual base salary of $415,000, and an annual target bonus opportunity equal to 50% of his annual base salary. Beginning in 2020, Mr. Damon’s base salary adjustments and target bonus opportunities will be reviewed and decided by our board of directors.
Ms. Spilman    
From July 30, 2014 until July 5, 2019, Ms. Spilman served as our Chief Operating Officer. Prior to July 30, 2014, Ms. Spilman served as our Chief Revenue Officer. Under the initial terms of her employment agreement, Ms. Spilman was entitled to receive an annual base salary of $450,000 and an annual target bonus opportunity equal to 100% of her annual base salary, with a maximum annual bonus opportunity equal to 200% of her annual base salary.
In accordance with the periodic review and adjustment of Ms. Spilman’s salary set forth in Ms. Spilman’s employment agreement, our board of directors determined that, for the year ended December 31, 2019, Ms. Spilman would be entitled to receive an annual base salary of $515,000 and a target annual bonus opportunity equal to 200% of her annual base salary, with a maximum annual bonus opportunity equal to 100% of her annual base salary.
Ms. Spilman ceased serving as our Chief Operating Officer effective July 5, 2019.
Mr. Teodosiu
From May 2016 until August 16, 2019, Mr. Teodosiu served as our Chief Technology Officer. We entered into an employment agreement effective as of November 20, 2012 with Mr. Teodosiu. Under the terms of his employment agreement, for the year ended December 31, 2013, Mr. Teodosiu was entitled to receive an annual base salary of €210,000, and an annual target bonus opportunity equal to 60% of his annual base salary.
In accordance with the periodic review and adjustment of base salary and target bonus opportunity set forth in Mr. Teodosiu’s employment agreement, our board of directors determined that for the year ended December 31, 2019, Mr. Teodosiu would be entitled to receive an annual base salary of €335,000 (equivalent to approximately $375,057.29, converted into U.S. dollars pursuant to the exchange rate noted in footnote 1 to the Summary Compensation Table), and an annual target bonus opportunity equal to 60% of his annual base salary.
Mr. Teodosiu ceased serving as out Chief Technology Officer effective September 30, 2019. For a discussion of the arrangement for Mr. Teodosiu relating to his termination of employment, see the narrative under the caption “—Potential Payments Upon Termination or Change of Control, Named Executive Officers” below.





Outstanding Equity Awards at 2019 Fiscal Year End
The following table sets forth the number of securities underlying outstanding equity awards held by the named executive officers as of December 31, 2019.
 
 
 
 
Option Awards
 
Stock Awards
Name
 
Grant Date
 
Number of 
Securities 
Underlying 
Unexercised 
Options 
Exercisable
(#)
 
Number of 
Securities 
Underlying 
Unexercised 
Options Unexercisable
(#)(1)
 
Equity 
Incentive 
Plan 
Awards: 
Number of 
Securities 
Underlying 
Unexercised 
Unearned 
Options
(#)
 
Option 
Exercise 
Price 
($)(3)
 
Option 
Expiration 
Date
 
Number 
of Shares 
or Units 
of Stock 
That Have 
Not 
Vested 
(#)(1)
 
Market 
Value of 
Shares or 
Units of 
Stock That 
Have Not 
Vested
($)(6)
 
Equity 
Incentive 
Plan 
Awards: 
Number of 
Unearned 
Shares, 
Units or 
Other 
Rights 
That Have 
Not Vested 
(#)(1)(7)
 
Equity 
Incentive 
Plan 
Awards: 
Market or 
Payout 
Value of 
Unearned 
Shares, 
Units or 
Other 
Rights 
That Have 
Not 
Vested 
($)(6)(2)
Jean-Baptiste Rudelle
 
4/30/12

 
77,773

 

 

 
7.87

 
4/30/22

 

 

 

 

 
 
07/30/14

 
329,281

 

 

 
30.82

 
07/30/24

 

 

 

 

 
 
10/29/15

 
110,000

 

 

 
39.00

 
10/29/25

 

 

 

 

 
 
6/28/16

 
50,998

 
7,285 (2)

 

 
42.68

 
6/28/26

 

 

 

 

 
 
7/28/16

 
19,168

 
4,424 (2)

 

 
41.99

 
7/28/26

 
5,718 (4)

 
99,093

 

 

 
 
6/27/17

 
8,189

 
4,911 (2)

 

 
48.61

 
6/27/27

 
936 (4)

 
16,221

 

 

 
 
3/16/18

 
28,656

 
36,844 (2)

 

 
30.40

 
3/16/28

 

 

 

 

 
 
6/26/18

 
57,312

 
95,520 (2)

 

 
33.57

 
6/26/28

 

 

 

 

 
 
4/25/19

 

 

 

 

 

 
257,291 (5)

 
4,458,853

 
111,458 (4)

 
1,931,567

Megan Clarken
 
12/11/19

 

 
375,467 (2)

 

 
17.54

 
12/11/19

 
143,308 (5)

 
2,483,528

 

 

Benoit Fouilland
 
3/20/12

 
100,221

 

 

 
7.82

 
3/20/22

 

 

 

 

 
 
9/3/13

 
60,000

 

 

 
15.95

 
9/3/23

 

 

 

 

 
 
10/29/15

 
60,000

 

 

 
39.00

 
10/29/25

 

 

 

 

 
 
6/28/16

 
42,431

 
6,061 (2)

 

 
42.68

 
6/28/26

 

 

 

 

 
 
7/28/16

 
15,948

 
3,680 (2)

 

 
41.99

 
7/28/26

 
4,758 (4)

 
82,456

 

 

 
 
6/27/17

 
37,664

 
22,596 (2)

 

 
48.61

 
6/27/27

 
4,312 (4)

 
74,727

 

 

 
 
3/16/18

 
43,940

 
56,493 (2)

 

 
30.40

 
3/16/28

 

 

 

 

 
 
4/25/19

 

 

 

 

 

 
120,208 (5)

 
2,083,205

 
52,083 (4)

 
902,598

Ryan Damon
 
10/25/18

 
16,375

 
49,125 (2)

 

 
20.48

 
10/25/28

 
25,000 (4)

 
433,250

 

 

Mary Spilman
 

 

 

 

 

 

 

 

 

 

Dan Teodosiu
 

 

 

 

 

 

 

 

 

 

(1)
Refer to “—Potential Payments upon Termination or Change of Control” below for circumstances under which the terms of the vesting of equity awards would be accelerated.
(2)
The stock options will generally vest as to 25% of the grant on the first anniversary of the date of grant and in 16 equal quarterly installments thereafter, based on continued employment.




(3)
The applicable exchange rate for the exercise price of the stock option and employee warrant awards shown in the Outstanding Equity Awards at Fiscal Year End table are as follows:
Date
 
Euro to U.S. Dollar Conversion Rate
12/11/19
 
1.1077
10/25/18
 
1.1389
6/26/18
 
1.1700
3/16/18
 
1.12340
6/27/17
 
1.1294
7/28/16
 
1.0991
6/28/16
 
1.0998
10/29/15
 
1.1086
1/29/15
 
1.1343
7/30/14
 
1.3429
9/3/13
 
1.3207
4/18/13
 
1.3129
2/7/13
 
1.3528
10/25/12
 
1.2942
4/30/12
 
1.3229
3/20/12
 
1.3150
(4)
The PSUs will generally vest as to 50% of the earned amount on the second anniversary of the date of grant and in eight equal quarterly installments thereafter, based on continued employment.
(5)
The RSUs will generally vest as to 70% on the two-year anniversary of the grant date, and the remainder will vest in equal portions at the end of each year during the two-year period thereafter.
(6)
Determined with reference to $17.33, the closing price of an ADS on December 31, 2019.
(7)
Reflects the total amount of PSUs granted to our named executive officers. Because the 2019 Revenue ex-TAC performance threshold was met but the target was not met (as determined by the board of directors), 50% of the PSUs granted to our executives were earned. Ms. Spilman and Mr. Teodosiu forfeited their 2019 PSUs when their respective employments with the Company terminated. See “Executive Compensation—Compensation Discussion and Analysis—Elements of Executive Compensation Program—Long-Term Incentive Compensation” for a discussion of the terms of the PSUs granted in 2019.
Option Exercises and Stock Vested in 2019
The following table summarizes for each named executive officer the stock option exercises and shares vested from outstanding stock awards during the year ended December 31, 2019.
 
 
Option Awards
 
Stock Awards
Name
 
Number of Shares 
Acquired on 
Exercise 
(#)
 
Value Realized on 
Exercise
($)
 
Number of Shares 
Acquired on 
Vesting 
(#)
 
Value Realized on 
Vesting 
($)
Jean-Baptiste Rudelle
 
 
 
20,693
 
435,706
Megan Clarken
 
 
 
 
Benoit Fouilland
 
 
 
19,806
 
392,429
Ryan Damon
 
 
 
 
Mary Spilman
 
 
 
7,245
 
140,621
Dan Teodosiu
 
3,000
 
26,530
 
12,097
 
236,293

Potential Payments upon Termination or a Change of Control
Individual Agreements
We have entered into employment agreements and non-compete agreements, as described below, which require us to provide specified payments and benefits to certain of our executive officers as a result of certain terminations of employment, including following a change of control. Each of the employment agreements with our named executive officers (except Ms. Spilman), discussed above in “Executive Compensation—Compensation Tables—Executive Employment Agreements,” provide for severance, non-compete or change of control payments.
Ms. Clarken




Ms. Clarken’s employment agreement provides for a potential severance payment in the event of termination of employment with Criteo Corp. If Ms. Clarken’s office as Chief Executive Officer of Criteo Corp. is terminated by Criteo Corp. other than for Cause (as defined in her employment agreement) and other than due to her death or disability, or by Ms. Clarken for Good Reason (as defined in her employment agreement) (each, an “involuntary termination”), subject to Ms. Clarken’s execution of a general release of claims in favor of Criteo S.A. and Criteo Corp. and continued compliance with the restrictive covenants set forth in her protective covenants agreement, Ms. Clarken will be entitled to receive (i) a lump sum cash amount equal to the sum of (A) Ms. Clarken’s annual base salary rate as then in effect (without giving effect to any reduction in base salary amounting to Good Reason), (B) an annual bonus for the calendar year during which the involuntary termination occurs, calculated based on the annual bonus that would be paid to Ms. Clarken if her office had not terminated and if all performance-based milestones were achieved at the 100% level by both Criteo Corp. and Ms. Clarken, (C) all earned but unpaid bonus amounts for completed performance periods prior to the termination date (notwithstanding any requirement to remain in service through the payment date) and (D) up to $75,000 in reimbursement for certain expenses incurred by Ms. Clarken in connection with her relocation from Paris, France back to her home country, including airfare for Ms. Clarken and her spouse, and furniture and household goods moving expenses, (ii) the cost of COBRA premiums under Criteo Corp.’s group health insurance plans in the United States and the cost of premiums for medical, dental, life insurance and disability insurance in France, in each case, for the 12-month period following the termination date and (iii) continued vesting of outstanding unvested stock options, RSUs and PSUs as if Ms. Clarken remained in service for 12 months following the termination date (and in the case of PSUs, based on actual performance at the end of the applicable performance year, as determined by the board in its reasonable discretion). All vested stock options will remain exercisable by Ms. Clarken for the 12-month period following the termination date, or the earlier expiration of the stock option pursuant to its original terms.
If Ms. Clarken’s office as Chief Executive Officer of Criteo Corp. is terminated due to an involuntary termination within one year following a Change in Control (as defined in her management agreement), subject to Ms. Clarken’s execution of a general release of claims in favor of Criteo S.A. and Criteo Corp. and continued compliance with the restrictive covenants set forth in her protective covenants agreement, Ms. Clarken will be entitled to receive immediate vesting of all outstanding unvested stock options, RSUs and PSUs based on achievement of the target level of performance, provided that no RSU or PSU granted within the one-year period prior to the date of Ms. Clarken’s termination will vest (but, in such event, any unvested RSUs or PSUs will continue to vest as if Ms. Clarken remained in service for up to 12 months following the termination date). All vested stock options will remain exercisable by Ms. Clarken for the 12-month period following the termination date, or the earlier expiration of the stock option pursuant to its original terms.
Any RSUs or PSUs that become vested pursuant to the terms of her employment agreement will be subject to a holding period until the second anniversary of the date of grant of the award, and the shares relating to such vested RSUs and PSUs will be definitively acquired by (delivered to) Ms. Clarken no earlier than the expiration of the required holding period.
Mr. Rudelle
Mr. Rudelle is party to a non-compete agreement with us that provides for a severance benefit equivalent to 50% of his total gross compensation (not including equity-based compensation) for the 12-month period preceding the date of his termination of employment, payable in a lump sum within 30 days following the date of termination of employment, subject to deduction of any amount that Mr. Rudelle may receive separately from us in remuneration for non-compete obligations under any other agreements. If we elect to waive the competitive restrictions in the non-compete agreements within 15 days following the date of termination of employment, however, we will not be required to make any such severance payments.
Mr. Fouilland
Mr. Fouilland’s employment agreement provides for a potential severance payment in the event of termination of employment within a period of six months following a change of control of the Company (as defined in the agreement), either by way of a dismissal by us, other than due to his gross negligence, or a resignation by Mr. Fouilland following a decrease of his compensation or responsibilities. Such severance payment is equivalent to one year’s total cash compensation, including the bonus for the year of termination, calculated based on the actual achievement of all objectives. In addition, Mr. Fouilland’s employment agreement includes restrictions on certain competitive activities during the one-year period following the date of his termination of employment, subject to payment by us of monthly compensation equal to 33% of the average monthly gross salary paid to Mr. Fouilland during the 12 months preceding his termination. We may choose to waive the competitive restrictions, in which case we will not be required to make the non-compete payment.
In addition, in April 2019, the board of directors approved an amendment to the terms of Mr. Fouilland’s outstanding equity awards, to provide that in the event that Mr. Fouilland is terminated by us without cause or resigns with good reason, in each case, upon or within 12 months following a change in control of the Company (as defined in the 2016 Stock Option Plan), his entire award will accelerate and become exercisable as of his termination date, provided that the PSUs will vest in the amount that would become vested assuming achievement of the target level of performance, and provided further that in all instances (x) the provisions of the Amended and Restated 2015 RSU Plan and the Amended and Restated 2015 PSU Plan which prohibit the acceleration or shortening of the minimum vesting period of one year will continue to apply, and (y) any PSUs or RSUs that may become so vested pursuant to these rights will be subject to a holding period until the second anniversary of the date of grant of the award, and the free shares relating to such vested RSUs or PSUs will be definitively acquired by him no earlier than the expiration of the required holding period. Additionally, Mr. Fouilland’s vested OSAs shall remain exercisable by him for the 12-month period following his termination date, but in no event later than the original expiration date of such OSAs.




Mr. Damon
Mr. Damon’s employment agreement provides for a potential severance payment in the event Mr. Damon is terminated by us without cause or resigns with good reason (as such terms are defined in his employment agreement). In such an event, Mr. Damon shall receive, on the 60th day following the termination date (as defined in the agreement), a lump sum cash amount (less applicable withholdings) equal to the sum of (i) the product of (x) six (or in the event of a change of control (as defined in the agreement) and a subsequent involuntary termination within 12 months following the date of such change of control, 12), and (y) Mr. Damon’s monthly base salary rate as then in effect (without giving effect to any reduction in base salary amounting to good reason (as defined in the agreement)), (ii) an amount equal to the product of (x) 50% (or in the event of a change of control (as defined in the agreement) and a subsequent involuntary termination within 12 months following the date of such change of control, 100%) and (y) Mr. Damon’s annual bonus for the calendar year during which the termination occurs, calculated based on the bonus that would be paid to Mr. Damon if his employment had not terminated and if all performance-based milestones were achieved at the 100% level by both the Company and Mr. Damon, such bonus to be, solely for the purpose of defining severance benefits, and (iii) all bonus amounts earned for completed performance periods prior to the termination date but which otherwise remain unpaid as of the termination date.
In addition, in the event that Mr. Damon is terminated by us without cause or resigns with good reason, in each case, upon or within 12 months following a change in control of the Company (as defined in the 2016 Stock Option Plan), his entire award will accelerate and become exercisable as of his termination date, provided that the PSUs will vest in the amount that would become vested assuming achievement of the target level of performance, and provided further that in all instances the provisions of the Amended and Restated 2015 RSU Plan and the Amended and Restated 2015 PSU Plan which prohibit the acceleration or shortening of the minimum vesting period of one year will continue to apply. Any RSUs or PSUs that become vested pursuant to the terms of Mr. Damon’s employment agreement will be subject to a holding period until the second anniversary of the date of grant of the award and the shares relating to such vested RSUs and PSUs will be definitively acquired by (delivered to) Mr. Damon no earlier than the expiration of the required holding period.
Treatment Under Equity Plans
Stock Option Plans
Each of our 2012 Stock Option Plan, 2013 Stock Option Plan, 2014 Stock Option Plan and 2016 Stock Option Plan provides that in the event of a change of control of the Company (as defined in the plans), a successor corporation shall assume all outstanding options or substitute outstanding options with equivalent options or rights. Pursuant to the stock option plans, in the event that the successor corporation does not agree to assume or substitute outstanding options, the options will accelerate and become fully vested and exercisable upon the change of control.
Upon termination of an option holder’s employment with us, unless a longer period is specified in the notice of award or otherwise determined by the board of directors, a vested option will generally remain exercisable for 90 days following the option holder’s termination.
If, at the date of termination, the option holder is not entitled to exercise all of his options, the shares covered by the unexercisable portion will be forfeited and revert back to the applicable stock option plan.
Employee Warrants (BSPCE)
Our employee warrants provide that an unvested warrant will only accelerate in the case of a change of control of the Company (as defined in the relevant grant agreement), if the acquirer or the successor corporation does not agree to assume or substitute equivalent rights for the outstanding unvested employee warrants. Upon termination of a BSPCE holder’s employment with us, unless a longer period is specified in the notice of award or otherwise determined by the board of directors, a vested BSPCE will remain exercisable for 90 days following the BSPCE holder’s termination.
Performance-Based Free Share (PSU) Plan
Pursuant to the terms of our Amended and Restated 2015 Performance-Based RSU Plan, in the event of a change of control of the Company, if a successor corporation does not agree to assume an unvested PSU award or substitute for the PSU award with an equivalent right, and the grant date of the PSU is at least one year prior to the date of the change of control, the restrictions and forfeiture conditions applicable to the PSU will lapse, and the PSU award will become vested prior to the consummation of the change of control, with any performance conditions being deemed to be achieved at target levels. If the grant date of the PSU award is less than one year prior to the date of the change of control of the Company and no such successor corporation agrees to assume or substitute an unvested PSU, the PSU will lapse.
In the event of a recipient’s death or disability (as defined in the Amended and Restated 2015 Performance-Based RSU Plan), an unvested PSU will vest automatically. In the event of a recipient’s retirement (as defined in the Amended and Restated 2015 Performance-Based RSU Plan), our board of directors has the discretion to determine whether some or all of the unvested PSUs will vest, subject to the limitations of the plan.




If an employee with outstanding PSUs terminates his employment, or we terminate the employee’s service with the Company or any of our affiliates, the employee’s right to vest in the PSUs under the Amended and Restated 2015 Performance-Based RSU Plan, if any, will terminate effective as of the date that such employee is no longer actively employed.
Time-Based Free Share (RSU) Plan
Pursuant to the terms of our Amended and Restated 2015 Time-Based RSU Plan, in the event of a change in control (as defined in the 2015 Time-Based RSU Plan), if a successor corporation or a parent or subsidiary of the successor corporation does not agree to assume or substitute outstanding RSUs, and only if the RSUs were granted at least one year prior to the date of the change in control, the restrictions and forfeiture conditions applicable to the RSUs will lapse and the RSUs will be deemed fully vested prior to the consummation of a change in control.
In the event of a recipient’s death or disability (as defined in the Amended and Restated 2015 Time-Based RSU Plan), any unvested RSUs will vest automatically. In the event of a recipient’s retirement (as defined in the Amended and Restated 2015 Time-Based RSU Plan), our board of directors has the discretion to determine whether some or all of the unvested RSUs will vest, subject to the limitations of the plan.
If an employee with outstanding RSUs terminates his employment, or we terminate the employee’s service with the Company or any of our affiliates, the employee’s right to vest in the RSUs under the Amended and Restated 2015 Time-Based RSU Plan, if any, will terminate effective as of the date that such employee is no longer actively employed.
Named Executive Officer Departures
Mr. Teodosiu
Effective July 26, 2019, we entered into a mutual agreement with Mr. Teodosiu, pursuant to which Mr. Teodosiu remained employed as a non-executive employee with the Company during a garden leave period commencing on August 16, 2019 and ending on September 30, 2019 (the “Garden Leave Period”) under the conditions provided for in the French Labor Code and the collective bargaining agreement applicable to Mr. Teodosiu. Mr. Teodosiu’s employment with the Company terminated on September 30, 2019.
Pursuant to the mutual agreement, during the Garden Leave Period, Mr. Teodosiu, subject to applicable withholding taxes (i) continued to receive his then-current base salary; (ii) remained eligible to participate in the Company’s standard employee benefit plans; and (iii) continued to vest in outstanding long-term incentive awards in accordance with the applicable plan documents and agreements, provided that Mr. Teodosiu was not eligible for any new long-term incentive grant in 2019 or thereafter. On September 30, 2019, the mutual agreement provided that Mr. Teodosiu became entitled to receive (i) a legal and mutual agreement indemnity equal to €184,350 ($206,393.47 pursuant to the exchange rate noted in footnote 1 to the Summary Compensation Table), as required pursuant to French law, and (ii) acceleration of a previously agreed upon retention bonus equal to €200,000 ($223,914.80 pursuant to the exchange rate noted in footnote 1 to the Summary Compensation Table).
Effective October 24, 2019, we and Mr. Teodosiu entered into a settlement agreement, pursuant to which we agreed, as a final and irrevocable settlement and waiver of all disputes relating to the termination of his employment with the Company, to provide to Mr. Teodosiu an additional severance equal to €428,249.38 in the aggregate ($479,456.87 pursuant to the exchange rate noted in footnote 1 to the Summary Compensation Table).
Mr. Teodosiu’s employment agreement includes restrictions on certain competitive activities during the one-year period following the date of his termination of employment, subject to payment by us of monthly compensation equal to 33% of the average monthly gross salary paid to Mr. Teodosiu during the 12 months preceding his termination. We were entitled to choose to waive the competitive restrictions, in which case we would not be required to make the non-compete payment. As part of the mutually agreed settlement agreement entered into between us and Mr. Teodosiu, we waived Mr. Teodosiu’s contractual non-compete obligations, such that he was not owed any financial consideration in this respect.
Ms. Spilman
The Company did not make any severance payments to Ms. Spilman upon her departure.
Estimated Payments and Benefits
The following table estimates the potential amounts payable to our named executive officers in connection with certain terminations of their employment or a change of control of the Company, under the circumstances described in more detail above. The table reflects estimated amounts assuming that the termination of employment or other circumstance, as applicable, occurred on December 31, 2019. The actual amounts that would be paid upon a named executive officer’s termination of employment or a change of control can be determined only at the time of such event. For a description of the payments and benefits received by Mr. Teodosiu in connection with his termination of employment, refer to “Potential Payments upon Termination or Change of Control” above.




POTENTIAL PAYMENTS UPON TERMINATION OR FOLLOWING A CHANGE OF CONTROL
 
 
Termination Without Cause
 
Termination Without Cause or Resignation by the Executive With Change of Control
Name

Severance Pay 
($)
Accelerated Vesting of Equity Awards ($)
Non-Compete Payments
($)(1)
Continued Insurance Coverage
($)(2)

Total
($)
Severance Pay
($)

Accelerated Vesting of Equity Awards ($)(3)
Non-Compete Payments
($)(1)
Continued Insurance Coverage
($)(2)
Total
($)
Jean-Baptiste Rudelle










Megan Clarken
1,350,000

620,882


19,283

1,990,165

1,350,000

2,483,528


19,283

3,852,811

Benoit Fouilland


147,784


147,784

783,702

157,183

147,784


1,088,669

Ryan Damon
311,250



27,944

339,194

622,500

433,250


27,944

1,083,694

 
_________

1.
Assumes we did not elect to waive the competitive restrictions in the relevant non-compete clause.
2.
Amount shown is an estimate based on the monthly cost of life and disability insurance and health insurance coverage as of the end of 2019.
3.
The value shown includes the value of equity awards held by the executive that would become vested under the applicable circumstances. The value of stock options and employee warrants, to the extent applicable, is based on the excess, if any, of $17.33, the closing price of an ADS on December 31, 2019, over the exercise price of such options or warrants, multiplied by the number of unvested stock options or employee warrants held by the executive that would become vested under the applicable circumstances. For 2019, the value of such stock options held by Messrs. Rudelle and Fouilland, and Ms. Clarken, is $0, because $17.33, the closing price of an ADS on December 31, 2019, is less than the exercise price of the unvested stock options that would become vested under the applicable circumstances. The exchange rate used to convert the exercise price of the options or warrants from euros into U.S. dollars is 1.119574. The amount shown represents the value of the equity awards that would vest upon a change of control under the additional assumption that outstanding equity awards are not assumed or substituted in the change of control transaction, as described above in the “Potential Payments Upon Termination or Change of Control—Treatment Under Equity Plans” narrative.





PAY RATIO DISCLOSURE
Pursuant to the Securities Exchange Act of 1934, as amended, we are required to disclose in this proxy statement the ratio of the total annual compensation of our Chief Executive Officer to the median of the total annual compensation of all of our employees (excluding our Chief Executive Officer). Based on SEC rules for this disclosure and applying the methodology described below, we have determined that total compensation for Ms. Clarken, our current Chief Executive Officer, for 2019 was $6,485,215, and the median of the total compensation of all of our employees (excluding Ms. Clarken) for 2019 was approximately $81,524. Accordingly, we estimate the ratio of Ms. Clarken’s total compensation for 2019 to the median of the total compensation of all of our employees (excluding Ms. Clarken) for 2019 to be approximately 80 to 1.
We selected December 31, 2019, which is a date within the last three months of fiscal 2019, as the determination date to identify our median employee. To find the median of the annual total compensation of all our employees (excluding Ms. Clarken), we used the amount of salary, wages, overtime and bonus from our payroll records as our consistently applied compensation metric. In making this determination, we annualized the compensation for those employees who were hired during fiscal 2019 as permitted under SEC rules. We did not make any cost-of-living adjustments in identifying the median employee. After identifying the median employee, we calculated the annual total compensation for such employee using the same methodology we used for Ms. Clarken’s annual total compensation in the Summary Compensation table for fiscal year 2019.
Since two individuals served in the role of Chief Executive Officer during 2019, we have elected to present information for Ms. Clarken, who took over the role in November 2019. For 2019, the total compensation as reported in the “Total” column of the “Summary Compensation Table” above for our Chief Executive Officer, Ms. Clarken, was $5,450,635. Since Ms. Clarken was appointed as our Chief Executive Officer effective as of November 25, 2019, we calculated her total annual compensation for pay ratio purposes by (i) annualizing her base salary, (ii) annualizing her annual incentive award and applying a payout percentage based on 100% achievement of company and personal objectives, (iii) adding the total value of the sign-on bonus and all of the share-based awards she received in fiscal year 2019 (which are comprised of the inducement awards in connection with her appointment as Chief Executive Officer as described in “Compensation Discussion and Analysis” above) and (iv) adding the total value of the relocation allowance she received in connection with her move from New York, NY to Paris, France. This calculation resulted in the assumed total annual compensation for Ms. Clarken in fiscal year 2019 of $6,485,215 for purposes of the pay ratio calculation above.
In accordance with SEC rules, we excluded all employees in certain non-U.S. jurisdictions that, in each case, constituted less than 0.87% of our total headcount. The excluded employees were located in Canada (1 employee), Australia (13 employees), China (12 employees), the Netherlands (15 employees), Sweden (12 employees) and Turkey (12 employees). The 65 excluded employees constituted 2.29% of our total number of 2,757 U.S. and non-U.S. employees as of December 31, 2019.













I.
Management report

1.
Presentation of the Criteo Group and Criteo S.A. operations
a)
Group’s operations during the latest financial year

Criteo began selling elements of its offering in France in 2007 and has since expanded its business into other countries in Europe. In 2009, Criteo extended its activities into North America and entered the Asia-Pacific region in late 2010. In November 2016, Criteo acquired HookLogic, Inc. ("HookLogic"), a New York-based company that developed a performance marketing exchange connecting consumer brand manufacturers with retail ecommerce sites via sponsored product ads sold by ecommerce retailers. Criteo offers HookLogic's products under the "Criteo Retail Media " name.

Criteo is a global technology company providing marketers with impactful and trusted advertising. It helps commerce companies and brand manufacturers acquire, convert and re-engage their customers independently via the Criteo platform, using users shopping data, predictive technology and large consumer reach. Criteo's advertising campaigns enable its clients to generate sales, website visits, mobile application installations and increase brand awareness on a large scale. Criteo Retail Media also allows retailers to generate advertising revenue from brands. Its data is pooled among its clients and offers deep insights into consumer intent and purchasing habits. To offer impactful and trusted advertising, Criteo activates its data assets through proprietary machine-learning algorithms and respecting user privacy to engage consumers in real time through the pricing and delivery of highly relevant digital advertisements, across devices and environments. By pricing its offering on a cost-per- click and measuring its value based on post-click sales, Criteo makes the return on investment transparent and easy to measure for its clients.

Criteo's mission is to provide marketers, brands, commerce companies, publishers, content creators and agencies worldwide with impactful and trusted advertising. Criteo's platform enables its clients to achieve their various marketing objectives, from conversion to brand awareness.

Over the past fourteen years, Criteo has built its market position by focusing on three pillars: actionable commerce data, predictive technology to activate the data and generate sales, and large consumer reach. Criteo continuously improves its technology and broadens its reach, and leverages and strengthens Criteo Shopper Graph, a highly differentiated group of data collectives built through collaboration and data pooling within its open ecosystem of commerce and brand clients.

Historically, the Criteo model focused solely on converting its clients' website visitors into customers (“Conversion”) through its historical solution “Criteo Dynamic Retargeting”. Since then, Criteo has broadened its portfolio of solutions to include additional marketing goals (including “Awareness” and “Consideration”) for commerce companies and consumer brands across web, apps and stores. This has required substantial investment by Criteo.

Driving consideration for an advertiser's products or services means attracting prospective new consumers to engage with and/or to buy its products or services.

To develop “Awareness”, Criteo aims in particular to expose a brand to consumers who have not been in contact with it before.

In addition to achieving these different marketing objectives through the "Criteo Marketing Solutions" offer, “Criteo Retail Media” enables merchants to generate advertising revenue from brands by monetizing their data and their audiences.

In accordance with Article L. 225-100-1. I. 5 of the French Commercial Code, all the internal control and risk management procedures relating to the preparation and processing of accounting and financial information have been implemented.
b)
Activity of subsidiaries and controlled companies

The following table presents the results of the Company’s subsidiaries for the fiscal year ended December 31, 2019.





In addition, the Company no longer had branches as of December 31, 2019.


2.
Financial information and consolidated results of the Group and Criteo S.A.

a)
The Group’s consolidated results

The consolidated financial statements for the financial year that ended on December 31, 2019 have been prepared in compliance with the standards set by IFRS (International Financial Reporting Standards), as adopted by the European Union. The main accounting methods, as well as the critical judgment and estimates are detailed in note 3.
The scope of consolidation as of December 31, 2019 is detailed in note 2 to the consolidated financial statements.


Consolidated statement of income

The revenue of the Group for the 2019 financial year amounted to €2,020.1 million (+3.6% compared to 2018).

Operational income amounted to €125.2 million and the net consolidated income amounted to €81.7 million.

The €9.4 million financial expense for the period ended December 31, 2019 was mainly driven by i) the interests on leases liabilities further the application of IFRS 16 Leases from January 1, 2019, ii) the non- utilization costs and upfront fees amortization incurred as part of our available RCF financing and iii) the recognition of a negative impact of foreign exchange reevaluations net of related hedging.

Income tax expense amounted to €34.1 million. This is mainly the result of €21.5 million in current taxes and in deferred taxes for €12.6 million. The main elements of the Group's taxes are presented in note 11 of the notes to the consolidated accounts.

The consolidated net profit attributable to the Criteo S.A. shareholder is a profit of €77.1 million (+2.4% compared to 2018); the minority interests’ share is €4.6 million.






Consolidated statement of position (balance sheet)

The total amount of the consolidated balance sheet was €1,590.6 million at the end of 2019 and is comprised of:

Non-current assets amounted to a total of €703.7 million, including €677.9 million in fixed assets.

Current assets amounted to €887.0 million and were in essence constituted by external accounts receivable for €425.6 million and cash for a sum of €372.8 million.

Group equity amounted to €893.3 million, including the Group’s profit for the period for €77.1 million.

Current liabilities amounted to €542.4 million and were mainly comprised of payables to external suppliers, for an amount of €347.6 million and lease liabilities for €40.9 million further the application of IFRS 16 Leases from January 1, 2019.

Non-current liabilities amounted to €127.6 million and were mainly comprised of leases liabilities further the application of IFRS 16 Leases from January 1, 2019.



Consolidated cash position and funding

Cash and cash equivalents include liquid assets and interest-bearing current accounts. These elements classified under cash are used to fund the Group's operations.

As of 31 December 2019, the Group’s cash and cash equivalents were €372.8 million. The Group had no bank overdraft as of December 31, 2019.

The variations and main elements of the cash and cash equivalents are presented in note 20 of the notes to the consolidated financial accounts.
Since 2012, we have taken several loans from financial institutions in order to fund tangible assets (equipment, in particular). In September 2015, we also agreed a renewable multi-currency line of credit enabling to draw €250 million or the equivalent amount in other currencies to fund the Group's general requirements, including external growth operations. On March 29, 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. As of December 31, 2017, the $75.0 million (€68.3 million) drawing executed in 2016 was fully repaid. The amount of the financial debt as of December 31, 2019 was €1.9 million. The breakdown of this debt into current and non-current financial liabilities is presented in note 25 of the notes to the consolidated financial statements.

We are also party to short-term credit lines and overdraft facilities with HSBC plc, BNP Paribas and LCL. We are 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, 2019, we 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.

All of these 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. At December 31, 2019, we were in compliance with the required conditions.



Commitments and contingencies

As of December 31, 2019, we had €6.0 million of other non-cancellable contractual obligations, primarily related to software licenses, maintenance and €0.9 million bandwidth for our servers.


b)
Criteo S.A. results

The annual financial statements for the financial year ended December 31, 2019, which we are submitting for your approval, including the balance sheet, the income statement, and the accompanying notes to the financial




statements, have been prepared in accordance with the French standards following group principles and methodology and in line with the presentation rules and appraisal methods provided by current regulations.

Income statement
During the financial year that ended on December 31, 2019, the Company generated net revenues of
€25.8 million compared to €90.7 million in the previous financial year.
Other operating incomes amounted to €482.7 million compared to €482.3 million in the previous financial year.
Operating charges amounted to €451.9 million compared to €510.3 million in the previous financial year. The operating income was a gain of €87.4 million compared to a gain of €93.3 million in the previous financial year.
Financial proceeds and financial charges amounted to €94.3 million and €64.7 million, respectively, compared to €121.1 million and €74.2 million for the previous financial year. This led to a financial profit of €29.7 million compared with a €46.9 million profit for the 2018 financial year.
Consequently, the profit from ordinary operations before taxes amounted to €117.1 million compared to the profit from ordinary operations before taxes of €140.2 million in the previous financial year.
Exceptional income was €7.4 million in 2019 compared to €0.1 million in 2018. Exceptional expenses amounted to €0.7 million compared to €1.6 million in the previous financial year.
The financial year ended on December 31, 2019 ended with a net income of €135.8 million compared to €123.6 million in the previous financial year.


Balance sheet

As of December 31, 2019, the Company’s total balance sheet was €1,208.6 million compared to
€1,100.8 million in the previous financial year.

Net intangible fixed assets were €28.2 million compared to €24.2 million in the previous financial year. Net tangible fixed assets were €102.2 million compared to €91.7 million in the previous financial year. Long-term investments were €537.8 million compared to €495.9 million in the previous financial year. Net current assets were €528.9 million compared to €471.3 million in the previous financial year.
As of December 31, 2019, the share capital was €1.7 million compared to €1.7 million in the previous financial year, and additional paid-in capital was €285.7 million compared to €315.8 million in the previous financial year.

Liabilities were €318.5 million for the year-ended December 31, 2019 compared to €303.9 million in the 2018 financial year, and were comprised of the following:

Loans and various financial debts(1)    €226.3 million
Accounts payable to suppliers and related accounts    €44.3 million
Accounts payable for taxes and social security    €35.3 million
Accounts payable for financial institutions    €1.6 million
Financing from financial institutions    €1.6 million
Other accounts payable    €9.3 million
(1) comprised mainly of intra-company accounts payable for €226.3 million, partially offset by intra- company accounts receivable for €110.4 million.

c)
Group’s and Company’s results over the past five years:

The tables referred to in Article R. 225-102 of the French Commercial Code are attached to this report as Appendix A-1 and A-2, showing the Group's and the Company's results over the past five years.

3.
Significant events

a)
At Group level

Change in estimated useful life of servers and other data center equipment

During the first quarter of 2019, the Group revised the estimate of the useful life of all servers and other equipment used in our data centers from three to five years. This change in estimate was determined based on a revised commissioning plan which extends the period equipment from three to five years. This resulted in an increase in income from operations of €37.5 million and an increase in net income of €32.0 million, or €0.50 per share.





Share repurchase program

On October 25, 2018, Criteo's Board of Directors authorized a share repurchase program of up to
$80.0 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 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.

As of December 31, 2019, we have 3.9 million treasury shares remaining which may be used to satisfy the company's obligations under its employee equity plans upon RSU vestings in lieu of issuing new shares, and for M&A.
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, United States. The company incurred net restructuring costs of €0.6 million in “Research and Development” including employee costs (€5.0 million) partially offset by gains from forfeitures of share based compensation expense (€4.4 million). The amount of current liability amounted to €5.0 million as of December 31, 2019.
Offices right sizing policy

In part of its cost management efficiency, the Company decided to implement an office right sizing policy. The Company incurred net restructuring costs of €10.9 million comprising of costs for impairment of right of use assets net of lease liability release (€9.0 million) and termination of facilities (€1.9 million). This restructuring cost was recorded in “Research & Development expenses” (€0.6 million), “Sales & Operations expenses” (€7.8 million) and “General & administrative expenses” (€2.5 million). The amount of current liability amounted to €0.7 million as of December 31, 2019.

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 €0.6 million comprising of employee costs (€3.5 million) partially offset by gains from forfeitures of share based compensation expense (€2.9 million). The amount of current liability amounted to €0.5 million as of December 31, 2019.

Companies’ combination

On November 4, 2019, Criteo Espana absorbed its fully-owned subsidiary, Storetail Marketing Services Spain S.L.


b)
At Criteo S.A. level


Share repurchase program





In the accounts of Criteo S.A., the transactions were accounted for as follows:
In addition, a provision for risks has been recognized for €22.4 million to cover free share allocations.


External financial investment

Acquisition and merger of Adspirit Software


In 2019, Criteo S.A. acquired Adspirit Software SAS (RCS Paris 844 226 456), specialized in the creation, development and commercialization of software allowing the automatization and setting up of animated, complex and innovating advertisements for a purchase amount of €4,767,283. Adspirit Software was then merged into Criteo S.A. on May 27, 2019, with no retroactive effect.
Investment in Condigolabs

On September 4, 2019, Criteo S.A. subscribed to a share capital increase decided by the shareholders of Condigolabs (RCS Paris 853 064 095) which purpose is to propose to publishers a content monetization platform financed by user-centric native advertising, for an amount of approximately
€1 million. Further to the completion of this share capital increase, Criteo held 40% of Condigolabs’ share capital and voting rights. This investment was financed by available cash resources.


Internal financial investments

Singapore :

Criteo S.A. decided to improve the net equity in its subsidiary in order for Criteo Singapore to no longer be under-capitalized Therefore, the capital of Criteo Singapore has increased by €17.3 million through the debt-to-equity conversion.

United Kingdom :

Criteo S.A. granted a 6-year loan to Criteo Limited for a total amount of €15.26 million as of July 29, 2019, by conversion of short-term debt.

Korea :

Criteo S.A. granted a 5-year loan to Criteo Korea for a total amount of €11.0 million as of November 20, 2019.
This loan allows the new subsidiary to acquire the net assets of the branch.


Filialization of Korean and Swedish branches

The Swedish branch was transformed into a wholly-owned subsidiary of Criteo S.A. on January 1, 2019. The Korean branch is expected to become a wholly-owned subsidiary of Criteo S.A. as of April 1, 2019.


4.
Subsequent events





On January 2, 2020, Manage.com Group, Inc. was merged into Criteo Corp.


5.
Main risks and uncertainties

Business-related risks
The Group’s business is based on the use of internal predictive algorithms which, together with knowledge about the user’s buying habits, enable it to display customized advertising banners that are relevant to the user. The optimal functioning of this tool is essential to the Group’s revenues.
The decision by some browsers to delete third-party cookies or to limit their use by default may limit its ability to collect the data necessary for the optimal functioning of these algorithms. This could have a significant impact on the Group’s business and revenues.
In this dynamic environment, in order to meet customers’ needs, the Group must be able to develop, improve or acquire new products and adapt its organization. This will enable it to market new products, meet current needs and anticipate future needs.
The Group’s ability to generate revenue is based on the optimization of massive amounts of data
collected from various sources. The collection of such data could be hindered by restrictions from market players concerning consumer habits or legal or regulatory technology changes.
Most of the revenue comes from advertisements placed on third party media sites. It does not own or control the available advertising space that it accesses through different channels. Contracts regulating such access generally do not include a long-term obligation, so cyclical changes may increase the costs borne by the Group.