Significant Events and Transactions of the Period

9 Months Ended

Sep. 30, 2020

Restructuring and Related Activities [Abstract]

Significant Events and Transactions of the Period

Share repurchase program

On October 25, 2018, Criteo's Board of Directors authorized a share repurchase program of up to $80.0 million of the Company’s outstanding American Depositary Shares. We completed this share repurchase program in 2018. As of December 31, 2018, 3.5 million shares were held as treasury shares.

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. We completed this share repurchase program in February 2020.

On April 23, 2020, Criteo's Board of Directors authorized a share repurchase program of up to $30.0 million of the Company's outstanding American Depositary Shares. We completed this share repurchase program in July 2020.

As of September 30, 2020, we had 6.0 million treasury shares remaining which may be used to satisfy the Company's obligations under its employee equity plans upon RSU vesting in lieu of issuing new shares, and for any potential M&A activity.


	Number of Treasury Shares	Amount (in thousands of dollars)
Balance at January 1, 2020	3,903,673	$	74,900


Treasury Shares Repurchased for RSU Vesting	3,358,068	43,655
Treasury Shares Issued for RSU Vesting	(1,272,483)	(26,105)
Balance at September 30, 2020	5,989,258	$	92,450

Restructuring

Cessation of our R&D operations in Palo Alto

On October 7, 2019, in connection with the new organization structure, the Company announced a plan to restructure its R&D activities with the closing of its R&D operations in Palo Alto. The Company incurred additional net restructuring costs of $0.06 million and $0.6 million for the three and nine months ended September 30, 2020, respectively, comprising of payroll expenses included in Research and Development expenses.

The following table summarizes restructuring activities as of September 30, 2020 included in other current liabilities on the balance sheet:


	Nine Months Ended
	September 30, 2020
	(in thousands)
Restructuring liability - January 1, 2020	$	5,581
Restructuring costs	560
Restructuring costs - non cash items	—
Amount paid	(5,108)
Restructuring liability - September 30, 2020	1,033

Termination of the Palo Alto Lease

On September 30, 2020, we early terminated the Palo Alto lease, originally expiring in 2027. We incurred broker fees and termination penalties of $4.6 million in connection with this transaction. The net impact of write-offs of the right of use assets, lease liabilities, and fixed assets associated with the lease was nil.

For the three and nine months ended September 30, 2020, $1.5 million was included in Research and Development expenses, $0.8 million was included in General and Administrative expenses and $2.3 million was included in Sales and Operations expenses.

New organization structure

As part of a new organization structure designed to best support our multi-product platform strategy and accelerate execution, commenced in the twelve month period ended December 31, 2019, the Company incurred net restructuring costs of $2.8 million and $3.9 million for the three and nine month periods ended September 30, 2020, respectively, comprising of payroll expenses.

For the three and nine month periods ended September 30, 2020, respectively, nil and $0.2 million was included in Research and Development expenses, $1.3 million and $1.3 million was included in General and Administrative expenses and $1.5 million and $2.4 million was included in Sales and Operations expenses.

The following table summarizes restructuring activities as of September 30, 2020 included in other current liabilities on the balance sheet:


	Nine Months Ended
	September 30, 2020
	(in thousands)
Restructuring liability - January 1, 2020	$	510
Restructuring costs	3,932
Amount paid	(2,159)
Restructuring liability - September 30, 2020	2,283

We expect the majority of the cash outlays related to the charges incurred in 2020 will be complete within the next three months.

Changes in Group funding

In September 2015, Criteo S.A. entered into a Multicurrency Revolving Facility Agreement for general purposes of the Group including the funding of business combinations. On May 4, 2020, Criteo decided to draw €140 million ($164 million) under its RCF credit facility for general purposes. The drawdown is for an initial period of six months. In addition, the parties to the RCF agreement have agreed to extend the term of the agreement for one additional year, from March 2022 to March 2023, composed of a €350 million ($410 million) commitment through March 2022, and a €294 million ($344 million) commitment from the end of March 2022 through March 2023. The cost of the one-year extension is 0.025% of the extended amount.

Changes in Group financial investments

In September 2020, a $20.0 million amount has been invested in a 12 months term deposit with an annual yield of 0.75%. This new investment is classified as Cash and Cash Equivalents.

In June 2020, a €20.0 million ($23.4 million) amount was invested in a 24 months term deposit with an annual yield of 0.25%. This investment has been classified as Marketable Securities, a non-current asset, as it does not meet the cash and cash equivalent criteria.