Share-Based Compensation

9 Months Ended

Sep. 30, 2023

Share-Based Payment Arrangement [Abstract]

Equity awards Compensation Expense

Equity awards compensation expense recorded in the consolidated statements of operations was as follows:


	Nine Months Ended
	2023	2022
	(in thousands)
Research and Development	(44,438)	(21,166)
Sales and Operations	(15,240)	(9,695)
General and Administrative	(16,675)	(11,733)
Total equity awards compensation expense	(76,353)	(42,594)
Tax benefit from equity awards compensation expense	6,084	4,409

The breakdown of the equity award compensation expense by instrument type was as follows:


	Nine Months Ended
	2023	2022
	(in thousands)
Share options	(80)	(47)
Lock-up shares	(28,326)	(7,088)
Restricted stock units / Performance stock units	(46,519)	(33,976)
Non-employee warrants	(1,428)	(1,483)
Total equity awards compensation expense	(76,353)	(42,594)
Tax benefit from equity awards compensation expense	6,084	4,409

A detailed description of each instrument type is provided below.

Share Options

Stock options granted under the Company’s stock incentive plans generally vest over four years, subject to the holder’s continued service through the vesting date and expire no later than 10 years from the date of grant.

In the following tables, exercise prices, grant date share fair values and fair value per equity instruments are provided in euros, as the Company is incorporated in France and the euro is the currency used for the grants.


	Options Outstanding
	Number of Shares Underlying Outstanding Options	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value

Outstanding as of December 31, 2022	372,329
Options granted	—
Options exercised	(41,417)
Options forfeited	(3,973)
Options canceled	—
Options expired	(1,861)
Outstanding as of September 30, 2023	325,078	€	20.88	4.37	€	11.46

Vested and exercisable as of September 30, 2023	301,611

The aggregate intrinsic value represents the difference between the exercise price of the options and the fair market value of common stock on the date of exercise. No new stock options were granted in the period ending September 30, 2023. As of September 30, 2023, unrecognized stock-based compensation $0.01 million related to unvested stock options will be fully recognized as of December 31, 2023.

Lock up shares

On August 1, 2022, 2,960,243 Treasury shares were transferred to the Founder (referred to as Lock Up Shares or "LUS", see Note 2), as partial consideration for the Iponweb Acquisition. As these shares are subject to a lock-up period that expires in three installments on each of the first three anniversaries of the Iponweb Acquisition, unless the Founder's employment agreement is terminated under certain circumstances during the pendency of such lock-up period, they are considered as equity settled share-based payments under ASC 718 and are accounted over the three-year vesting period. The share based compensation expense is included in Research and Development expenses on the Consolidated Statement of Income. The shares were valued based on the volume weighted average price of one ADS traded on Nasdaq during the twenty (20) trading days immediately preceding July 28, 2022.


	Shares	Weighted-Average Grant date Fair Value Per Share


Outstanding as of December 31, 2022	2,960,243	—
Granted	—	—
Vested	(1,006,482)	—
Forfeited	—	—
Outstanding as of September 30, 2023	1,953,761	€	23.94

At September 30, 2023, the Company had unrecognized stock-based compensation relating to restricted stock of approximately $22.4 million, which is expected to be recognized over a period from October 2023 to August 1, 2025.

Restricted Stock Units / Performance Stock Units

Restricted stock awards generally vest over four years, subject to the holder’s continued service and/or certain performance conditions through the vesting date.

In the following tables, exercise prices, grant date share fair values and fair value per equity instruments are in euros, as the Company is incorporated in France and the euro is the currency used for the grants.


	Shares (RSU)	Weighted-Average Grant date Fair Value Per Share


Outstanding as of December 31, 2022	5,349,955	—
Granted	1,575,851	—
Vested	(1,116,711)	—
Forfeited	(340,383)	—
Outstanding as of September 30, 2023	5,468,712	€	26.2

At September 30, 2023, the Company had unrecognized stock-based compensation relating to restricted stock of approximately $77.1 million, which is expected to be recognized over a weighted-average period of 3.10 years.


	Shares (PSU)	Weighted-Average Grant date Fair Value Per Share


Outstanding as of December 31, 2022	522,467	—
Granted	356,402	—
Vested	(173,092)	—
Forfeited	—	—
Outstanding as of September 30, 2023	705,777	€	27.94

At September 30, 2023, the Company had unrecognized stock-based compensation relating to restricted stock of approximately $11.0 million, which is expected to be recognized over a weighted-average period of 3.12 years.

Non-employee warrants

Non-employee warrants generally vest over four years, subject to the holder’s continued service through the vesting date.


	Shares	Weighted-Average Grant date Fair Value Per Share		Weighted-Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value


Outstanding as of December 31, 2022	302,775
Granted	—
Exercised	(58,318)
Canceled	—
Expired	—
Outstanding as of September 30, 2023	244,457	€	17.65	4.73	€	12.98

Vested and exercisable - September 30, 2023	237,852

The aggregate intrinsic value represents the difference between the exercise price of the non-employee warrants and the fair market value of common stock on the date of exercise.

No new stock non-employee warrants were granted in the period ending September 30, 2023. As of September 30, 2023 there is a small portion of instruments that are set to fully vest in 2023.