EX-99.2 3 t1701541_ex99-2.htm EXHIBIT 99.2

 

Exhibit 99.2

 

Mobileye N.V.
Har Hotzvim, 13 Hartom Street

P.O. Box 45157

Jerusalem 9777513

ISRAEL

 

NOTICE OF AND AGENDA FOR THE ANNUAL GENERAL MEETING OF SHAREHOLDERS TO BE HELD ON JUNE 13, 2017

 

To the Shareholders of Mobileye N.V.:

 

You are hereby notified that the 2017 annual general meeting of shareholders (the “Annual General Meeting”) of Mobileye N.V. (the “Company”) will be held at the Waldorf Astoria Amsterdam, Herengracht 542-556, 1017 CG Amsterdam, The Netherlands, at 3:00 P.M., Amsterdam time, on June 13, 2017, for the following purposes (each of which are voting items, except as otherwise specifically indicated below):

 

1.To provide information to shareholders concerning the offer (the “Offer”) made by Cyclops Holdings, LLC (the “Purchaser”), a Delaware (U.S.A.) limited liability company and a wholly-owned subsidiary of Intel Corporation, a Delaware corporation (“Intel”), to purchase all of the issued and outstanding ordinary shares of the Company, par value EUR 0.01 per share (the “Shares”), for cash consideration (without interest and less applicable withholding taxes) of US$ 63.54 per Share, as further specified in the Shareholders Circular relating to the Annual General Meeting attached as Annex A to this Notice of and Agenda for the Annual General Meeting (the “Shareholders Circular”). The Offer is being made by the Purchaser pursuant to the Purchase Agreement, dated March 12, 2017, by and among Cyclops Holdings, Inc., a Delaware corporation and a wholly owned subsidiary of Intel (“Cyclops”), Intel and the Company (as it may be amended from time to time, the “Purchase Agreement”), which was filed by Intel as Exhibit 2.1 to its Current Report on Form 8-K filed with the United States Securities and Exchange Commission (the “SEC”) (SEC File No. 000-06217) on March 13, 2017, and which is incorporated herein by reference. On April 4, 2017, Cyclops was converted from a Delaware corporation into a Delaware limited liability company (the “Purchaser Conversion”). All references in this Notice of and Agenda for the Annual General Meeting, and in the annexed Shareholders Circular, to the “Purchaser” describing the Purchaser’s rights and obligations under the Purchase Agreement refer to Cyclops prior to the Purchaser Conversion and to the Purchaser following the Purchaser Conversion. This is a discussion item only and shareholders will not vote on this item.

 

2.To approve (goedkeuren), as required under Section 2:107a of the Dutch Civil Code (the “DCC”) (the “Asset Sale Resolution”), (x) the sale and transfer by the Company of all or substantially all of the assets and liabilities of the Company to the Purchaser, or an affiliate of the Purchaser, and (y) the assumption by the Purchaser, or an affiliate of the Purchaser, of all or substantially all of the liabilities of the Company ((x) and (y) together, the “Asset Sale”), substantially on the terms and conditions set forth in the form of Asset Sale Agreement between the Company and the Purchaser (the “Asset Sale Agreement”), a copy of which is attached to the Shareholders Circular as Annex 1. The consummation of the Asset Sale is subject to the following conditions precedent: (A) the Purchaser having accepted all Shares validly tendered to it in accordance with the terms of the Offer, (B) a ruling or rulings (the “Pre-Wired Asset Sale Ruling”), in form and substance reasonably acceptable to the Purchaser and the Company, having been obtained from the Israeli Tax Authority (the “ITA”) (i) that, as more fully specified in the Purchase Agreement, exempts Intel, the Purchaser and the Company from Israeli taxation with respect to the Asset Sale, the liquidation of the Company resulting

 

 

 

 

from the Liquidation Resolution referred to below (the “Liquidation”) and the subsequent advance liquidation distribution in cash to shareholders of the Company who have not tendered their Shares to the Purchaser in the Offer, as contemplated by the Asset Sale Agreement (the “Second Step Distribution”), taking into account all relevant related steps (including the B.V. Conversion (as defined below)) and (ii) that the Asset Sale will not adversely affect the remaining duration or the extent of the incentives available to the Company and its subsidiaries resulting from the status of a “Preferred Enterprise” and/or “Benefitted Enterprise” under Israel’s Law for the Encouragement of Capital Investment, 1959, or require any recapture of any previously claimed incentive under such law, and that the entitlement of the Company or any of its subsidiaries to any such incentive shall be preserved despite the Asset Sale, (C) the number of Shares validly tendered to the Purchaser in accordance with the terms of the Offer (including Shares tendered during the Subsequent Offering Period (as such term is defined in the Shareholders Circular), as it may be extended by the Minority Exit Offering Period (as such term is defined in the Shareholders Circular), but excluding Shares tendered pursuant to guaranteed delivery procedures that have not yet been delivered in settlement or satisfaction of such guarantee prior to the time of expiration of the Offer), together with the Shares owned by the Purchaser or any of its affiliates, representing at least sixty-seven percent (67%) of the Company’s issued capital (the “Asset Sale Threshold”), (D) the Purchase Agreement not having been terminated in accordance with its terms, (E) each of the Liquidation Resolution and the Conversion Resolutions (as hereinafter defined) having been adopted by the general meeting of shareholders of the Company, (F) the Asset Sale Agreement having been executed by the parties thereto and (G) all other conditions precedent to the obligations of the Purchaser and the Company to effect completion of the Asset Sale (the “Asset Sale Completion”) under the Asset Sale Agreement, as more fully specified in the Asset Sale Agreement, having been satisfied or waived in accordance with the terms of the Asset Sale Agreement.

 

3.To liquidate (ontbinden) the Company (the “Liquidation Resolution”), subject to the following conditions precedent (the “Liquidation Conditions Precedent”): (A) the Purchaser having accepted all Shares validly tendered to it in accordance with the terms of the Offer, (B) the Asset Sale Threshold having been achieved and (C) the Asset Sale Completion having occurred, with the Liquidation to become effective immediately following the satisfaction of all of the Liquidation Conditions Precedent and, in connection with the Liquidation:

 

(i)to appoint Stichting Vereffening Mobileye (the “Liquidator”) as liquidator of the Company; and

 

(ii)to approve the following compensation of the Liquidator: the making by the Company to the Liquidator of payments in the total amount of up to EUR 25,000 in exchange for services provided by the Liquidator.

 

4.To convert (omzetten) (the “B.V. Conversion Resolution”) the Company from a public limited liability company (naamloze vennootschap or N.V.) (an “N.V.”) into a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid or B.V.) (a “B.V.”) under Dutch law (the “B.V. Conversion”), effective upon the first to occur of (i) the execution of the Conversion Deed of Amendment (as hereinafter defined) and (ii) the execution of the Post-Delisting Deed of Amendment (as hereinafter defined).

 

5.To amend (the “Conversion Amendment Resolution”) the Articles of Association of the Company (the “Articles”) in accordance with the draft deed designated “Conversion Deed of Amendment” prepared by Houthoff Buruma Coöperatief U.A. (“Houthoff”) (the “Conversion Deed of Amendment”), and to authorize each lawyer, each notary and each candidate notary of Houthoff, jointly as well as severally, to have executed and to sign the Conversion Deed of Amendment. A copy of the draft Conversion Deed of Amendment is attached to the Shareholders Circular as Annex 2 and is also available for inspection by shareholders free of charge at the address above. The execution of the Conversion Deed of Amendment is subject to the following conditions precedent (the “Conversion Deed of Amendment Conditions Precedent”): (i) the Purchaser having purchased and paid for all Shares validly tendered to it in the Offer (the “Offer Closing”), (ii) the Purchase Agreement not having been terminated in accordance with its terms and (iii) the B.V. Conversion

 

 

 

 

Resolution having been duly adopted by the general meeting of shareholders of the Company. The fulfillment of the Conversion Deed of Amendment Conditions Precedent shall be conclusively evidenced by delivery to the notary executing the Conversion Deed of Amendment of a certificate signed by an executive director of the Company, to the effect that the Conversion Deed of Amendment Conditions Precedent have been satisfied.

 

6.To amend (the “Delisting Amendment Resolution”; together with the B.V. Conversion Resolution and the Conversion Amendment Resolution, the “Conversion Resolutions”) the Articles in accordance with the draft deed designated “Post-Delisting Deed of Amendment” prepared by Houthoff (the “Post-Delisting Deed of Amendment”) and to authorize each lawyer, each notary and each candidate notary of Houthoff, jointly as well as severally, to have executed and to sign the Post-Delisting Deed of Amendment. A copy of the draft Post-Delisting Deed of Amendment is attached to the Shareholders Circular as Annex 3 and is also available for inspection by shareholders free of charge at the address above. The execution of the Post-Delisting Deed of Amendment is subject to the conditions precedent (the “Post-Delisting Deed of Amendment Conditions Precedent”) that (i) either (A) the Conversion Deed of Amendment shall have been executed or (B) all of the Conversion Deed of Amendment Conditions Precedent shall have been satisfied and (ii) the Shares shall no longer be listed for trading on the New York Stock Exchange (the “NYSE”). The fulfillment of the Post-Delisting Deed of Amendment Conditions Precedent specified in clauses (i)(B) and (ii) of the preceding sentence shall be conclusively evidenced by the delivery to the notary executing the Post-Delisting Deed of Amendment of a certificate signed by an executive director of the Company to the effect that such Post-Delisting Deed of Amendment Conditions Precedent have been satisfied.

 

7.To discuss certain disclosures concerning the compensation of the directors of the Company for the year 2016, as set forth in the Shareholders Circular. This is a discussion item only and shareholders will not vote on this item.

 

8.To discuss the annual report (jaarverslag) for the year 2016 included as part of the Dutch statutory accounts of the Company prepared in accordance with International Financial Reporting Standards (“IFRS”) for the year ended December 31, 2016 (the “2016 Accounts”); to adopt the 2016 Accounts, in accordance with the draft of the 2016 Accounts prepared by the Company and signed by all of the members of the Board of Directors of the Company; to take note of the auditor’s report prepared in connection with the 2016 Accounts; and to approve of the addition of the Company’s net income for the financial year ended December 31, 2016, as set forth in the 2016 Accounts, to the Company’s retained earnings reserve. Copies of the 2016 Accounts and the related auditors report are annexed to the Shareholders Circular as Annex 4, are also available for inspection by shareholders free of charge at the Company’s address as set forth above and will be emailed to shareholders free of charge, upon request to the Company’s Investor Relations Department at Investors@mobileye.com.

 

9.To grant to all of the members of the Board of Directors of the Company discharge from liability in accordance with Dutch law for the performance of their duties during the year ended December 31, 2016.

 

10.To further grant to all of the members of the Board of Directors of the Company, effective upon the time of acceptance by the Purchaser of all Shares validly tendered to it in the Offer, discharge from liability in accordance with Dutch law for the performance of their duties up to the date of the Annual General Meeting.

 

11.To re-elect:

 

(i)Tomaso Poggio as non-executive director of the Company;

 

(ii)Eli Barkat as non-executive director of the Company; and

 

(iii)Judith Richter as non-executive director of the Company,

 

 

 

 

each having a three-year term of office expiring at the end of the annual general meeting of shareholders to be held in the year 2020.

 

12.To elect (the “Governance Resolution”), effective as of the Offer Closing:

 

(i)Tiffany D. Silva as executive director of the Company, for a term of office ending at the close of the annual general meeting of shareholders of the Company held in the year 2018 (or, if such person becomes an executive director of the Company during the year 2018, at the close of the annual general meeting held in the year 2020);

 

(ii)David J. Miles as executive director of the Company, for a term of office ending at the close of the annual general meeting of shareholders of the Company held in the year 2018 (or, if such person becomes an executive director of the Company during the year 2018, at the close of the annual general meeting held in the year 2020);

 

(iii)Nicholas J. Hudson as non-executive director of the Company, for a three-year term of office ending at the close of the annual general meeting of shareholders of the Company held in the third calendar year following the calendar year during which such person becomes a non-executive director;

 

(iv)Mark L. Legaspi as non-executive director of the Company, for a three-year term of office ending at the close of the annual general meeting of shareholders of the Company held in the third calendar year following the calendar year during which such person becomes a non-executive director; and

 

(v)Gary Kershaw as non-executive director of the Company, for a three-year term of office ending at the close of the annual general meeting of shareholders of the Company held in the third calendar year following the calendar year during which such person becomes a non-executive director.

 

These directors will replace Amnon Shashua, Ziv Aviram, Tomaso A. Poggio, Eli Barkat and Judith Richter (the “Resigning Directors”), who will resign as members of the Board of Directors of the Company effective as of the Offer Closing. Eyal Desheh and Peter Seth Neustadter (together with any independent non-executive director subsequently elected to replace them, the “Independent Directors”) would continue to serve on the Board of Directors, as non-executive directors, after the Offer Closing.

 

13.To approve the compensation of the Independent Directors, after the Offer Closing, as follows: US$ 100,000 on an annual basis to each of the Independent Directors, payable by the Company in 4 equal quarterly installments of US$ 25,000 each, beginning on the first business day of the first calendar quarter following the Offer Closing and on the first business day of each subsequent calendar quarter during which the relevant Independent Director continues to serve on the Board of Directors, with a prorated portion of such quarterly fee to be payable in respect of the calendar quarter which includes the date on which the Offer Closing occurs.

 

14.To grant authority to the Board of Directors to repurchase up to 10% of the Company’s issued share capital, during the 18-month period ending December 13, 2018, on the open market, through privately negotiated transactions or in one or more self-tender offers, for a price per share not less than the nominal value of a share and not greater than (i) 110% of the most recent available (as of the time of repurchase) price of a share on any securities exchange on which the Company’s shares are listed or quoted at the time of repurchase or (ii) if the Company’s shares are not listed or quoted on any securities exchange at the time of repurchase, 110% of the fair market value of the Company’s shares at the time of repurchase, as determined by the Board of Directors of the Company acting in good faith.

 

 

 

 

15.To appoint PricewaterhouseCoopers Accountants N.V. (“PWC”) to serve as the Company’s independent public accounting firm to audit the Company’s Dutch statutory accounts prepared in accordance with IFRS for the year ending December 31, 2017.

 

16.As required by the Dutch Corporate Governance Code (the “Dutch Governance Code”), to discuss the Company’s dividend policy. This is a discussion item only and shareholders will not vote on this item.

 

Important information concerning procedures for attendance and voting at the Annual General Meeting, the record date for the Annual General Meeting and other relevant matters relating to the Annual General Meeting are contained in the Shareholders Circular, a copy of which is attached as Annex A to this Notice of and Agenda for the Annual General Meeting. The contents of the Shareholders Circular are incorporated by reference into this Notice of Meeting and Agenda.

 

You are urged to read the attached Shareholders Circular carefully and to follow the procedures set forth therein to cast your vote at the Annual General Meeting.

 

Shareholders who plan to attend the Annual General Meeting in person must give the Company prior written notice of their intention to attend the meeting. See the attached Shareholders Circular for instructions as to how to give notice of your intention to attend the Annual General Meeting in person.

 

May 12, 2017 By order of the Board of Directors:

 

  Peter Seth Neustadter
  Presiding Director of the Board of Directors

 

Important Notice Regarding the Availability of Proxy Materials for the Annual General Meeting: The notice of and agenda for the Annual General Meeting, together with the related Shareholders Circular, the form of Asset Sale Agreement, the draft Conversion Deed of Amendment, the draft Post-Delisting Deed of Amendment and the draft 2016 Accounts, are available on the Internet at www.proxyvote.com and at http://ir.mobileye.com/investor-relations/default.aspx.

 

 

 

 

ANNEX A

 

SHAREHOLDERS CIRCULAR

 

Mobileye N.V.

 

(the “Company”)

 

Shareholders Circular relating to the 2017 Annual General Meeting of Shareholders

 

To be held on June 13, 2017, Amsterdam, The Netherlands

 

May 12, 2017

 

Explanation to the Shareholders of the Company in respect of the Agenda for the 2017 Annual General Meeting of Shareholders to be held on June 13, 2017.

 

To the Shareholders:

 

This shareholders circular (this “Shareholders Circular”) contains information concerning the items on the agenda for the 2017 Annual General Meeting of Shareholders of the Company (the “AGM” or the “Annual General Meeting”) to be held on June 13, 2017 at 3:00 P.M., Amsterdam time, at the Waldorf Astoria Amsterdam, Herengracht 542-556, 1017 CG Amsterdam, The Netherlands. This Shareholders Circular is first being made available on or about May 12, 2017 to holders of the Company’s registered shares. Capitalized terms used but not defined in this Shareholders Circular have the meanings assigned to them in the notice of and agenda for the AGM to which this Shareholders Circular is attached (the “AGM Agenda”).

 

We are considered a foreign private issuer under the United States federal securities laws, and as such are not subject to those provisions of United States federal securities laws, and of the rules and regulations of the SEC, relating to the holding of shareholder meetings, including the form and contents of proxy statements and proxy cards. This Shareholders Circular therefore does not contain all the disclosures typically found in a proxy statement prepared in accordance with United States federal securities laws.

 

This Shareholders Circular contains certain forward-looking statements with respect to the Offer and related transactions, including the timing of certain transactions or events contemplated by the Purchase Agreement and other matters. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as “anticipate,” “target,” “expect,” “estimate,” “intend,” “plan,” “goal,” “believe,” “hope,” “aim,” “continue,” “will,” “may,” “would,” “could” or “should” or other words of similar meaning or the negative thereof. There are various factors which could cause actual plans and results to differ materially from those expressed or implied in forward-looking statements.

 

The forward-looking statements contained in this Shareholders Circular are based on numerous assumptions and possible assessments made by the Company in light of its experience and perception of current conditions, possible future developments and other factors it believes appropriate. By their nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. The factors described in the context of such forward-looking

 

 

 

 

statements in this Shareholders Circular could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements. Although it is believed that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct and persons reading this Shareholders Circular are therefore cautioned not to place undue reliance on these forward-looking statements, which speak only as at the date of this Shareholders Circular.

 

The information contained in this Shareholders Circular speaks only as of the date set forth above. The Company assumes no obligation to update the information contained in this Shareholders Circular to reflect any developments after the date set forth above, whether as a result of new information, future events or otherwise.

 

Vote Required to Approve the Items on the AGM Agenda

 

The resolutions to be adopted by shareholders as described in the AGM Agenda must generally be approved by a majority of the votes cast at the AGM in respect of each such item. However,

 

(i)the resolutions for approval of the sale by the Company of all or substantially all of its assets, and for the liquidation of the Company, as contained in Items 2 and 3 on the AGM Agenda; and

 

(ii)the resolutions for conversion of the Company from an N.V. into a B.V. and for the related amendments of the Articles, as contained in Items 4 through 6 on the AGM Agenda,

 

must be approved by two-thirds of the votes cast at the AGM, provided that the votes cast in favour of these resolutions also represent more than 50% of all issued and outstanding Shares.

 

Recommendation of the Board of Directors

 

The Board of Directors recommends that you vote all of your Shares “FOR” all items included on the agenda for the Annual General Meeting.

 

Two of the members of the Company’s Board of Directors, Professor Amnon Shashua and Mr. Ziv Aviram, who together hold approximately 7% of our issued and outstanding Shares, have agreed with the Purchaser that they will vote “FOR” all of the items related to the Offer which are included on the AGM Agenda, consisting of Items 2 through 6, 10 and 12 on the AGM Agenda (together, the “Offer-Related Resolutions”). See the discussion below of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement — Certain Other Agreements Tender and Support Agreements.”

 

Failure of the general meeting of shareholders of the Company to adopt certain of the Offer-Related Resolutions may limit the obligation of the Purchaser to consummate the Offer and/or may reduce the likelihood of the Offer Closing occurring. See the discussion below of Item 2 on the AGM Agenda, “General Background Effect of Adoption or Non-Adoption of the Asset Sale Resolution, Liquidation Resolution and Conversion Resolutions” and the discussion below of Item 12 on the AGM Agenda, “Effect of Non-Adoption of the Governance Resolution.” See also the discussion below of Item 2 on the AGM Agenda, “The Pre-Wired Asset Sale Ruling Effect on the Offer Closing of Issuance or Non-Issuance of the Pre-Wired Asset Sale Ruling.”

 

Tax Information

 

Israeli Taxation

 

This Shareholders Circular includes a summary of certain Israeli tax consequences of the Offer and the Post-Offer Reorganization (as hereinafter defined) to shareholders of the Company whose Shares are tendered and accepted for payment pursuant to the Offer or whose Shares are not tendered but who receive cash in the Post-Offer Reorganization. This summary is based on current provisions of the Israel Income Tax Ordinance (New

 

 

 

 

Version), 5721 – 1961 (the “Ordinance”), and regulations thereunder and administrative and judicial interpretations thereof, all of which are subject to change, possibly with retroactive effect, and could affect the Israeli tax consequences described in this Shareholders Circular. The Company and the Purchaser obtained a ruling from the ITA with respect to withholding requirements under the Ordinance (the “Israeli Equity Tax Ruling”). The discussion below of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement – The Purchase Agreement and the Offer – Israeli Withholding Tax,” provides a general description of certain terms and conditions of the Israeli Equity Tax Ruling.

 

The summary information contained in this Shareholders Circular is not a complete description of all the matters relating to Israeli tax consequences of the Offer or the Post-Offer Reorganization and does not address many of the tax considerations applicable to shareholders that may be subject to special tax rules or taxation under multiple tax jurisdictions.

 

In particular, except as set forth in the discussion of Item 2 on the AGM Agenda, under the heading “The Pre-Wired Asset Sale Ruling,” the discussion of Israeli tax matters in this Shareholders Circular is limited to a discussion of Israeli withholding tax matters and does not purport to contain any discussion of the general Israeli tax consequences of the sale of Shares to the Purchaser pursuant to the Offer, or the sale or transfer of Shares in any Post-Offer Reorganization, or any other general Israeli tax consequences of the Offer, or of any Post-Offer Reorganization that the Purchaser and Intel may elect to implement.

 

United States Taxation

 

This Shareholders Circular does not purport to contain any discussion of United States federal, state or local withholding or other taxes that may be applicable in connection with the Offer or the Post-Offer Reorganization, or of the general United States federal, state or local tax consequences of the sale of Shares to the Purchaser pursuant to the Offer, or the sale or transfer of Shares in any Post-Offer Reorganization.

 

General

 

WE URGE YOU TO CONSULT YOUR OWN TAX ADVISORS WITH RESPECT TO THE SPECIFIC TAX CONSEQUENCES THAT THE OFFER AND THE POST-OFFER REORGANIZATION WILL HAVE ON YOU, INCLUDING THE APPLICABILITY AND EFFECT OF FEDERAL, STATE, LOCAL AND FOREIGN INCOME, AND OTHER UNITED STATES, ISRAELI OR OTHER TAX LAWS, IN VIEW OF YOUR PARTICULAR CIRCUMSTANCES.

 

Procedures for Voting and Attendance at the AGM

 

The Company urges you to promptly cast your vote at the AGM. If you have received an original proxy card in hard copy format and wish to vote by mail, please complete, sign, date and promptly mail the enclosed proxy for use at the Annual General Meeting in the enclosed envelope. No postage is required for mailing in the United States. If you have not received an original proxy card in hard copy format, please vote by Internet or telephone using the instructions set forth below.

 

Instead of a paper copy of the Shareholders Circular and of the AGM Agenda, most of our shareholders are receiving a notice regarding the Internet availability of our proxy materials for the AGM. The notice includes instructions on how to access the proxy materials over the Internet. The notice also contains instructions on how each shareholder can receive a paper copy of our proxy materials, including this Shareholders Circular, the AGM Agenda and a form of proxy card.

 

Only holders of record of our Shares, outstanding at the close of business in New York on May 16, 2017 (the “Record Date”), are entitled to attend and vote at the Annual General Meeting.

 

Each shareholder is entitled to one vote for each of our Shares held of record by such shareholder as of the Record Date, on each matter submitted to a vote at the Annual General Meeting. All Shares represented by proxies duly executed and received by 11:59 A.M., United States Eastern Daylight Time on June 12, 2017 (the “Voter Deadline”), will be voted at the Annual General Meeting in accordance with the terms of the proxies.

 

 

 

 

If and to the extent that no choice is indicated on a proxy on any proposal, the proxyholders will vote in favour of all proposals described in this Shareholders Circular as to which no choice has been indicated on the proxy. If any business is properly brought before the Annual General Meeting under our Articles of Association or Dutch law other than that set forth in the AGM Agenda, all proxies will be voted in accordance with the best judgment of the proxyholders. In general, only those items appearing on the AGM Agenda can be voted on at the AGM.

 

A shareholder may revoke a proxy by submitting a document revoking it prior to the Voter Deadline, by submitting a duly executed proxy bearing a later date prior to the Voter Deadline or by attending the Annual General Meeting and voting in person.

 

If you hold your shares through a bank, brokerage firm or other agent and do not give instructions to your bank, brokerage firm or other agent as to how your shares should be voted at the Annual General Meeting, the shares that you hold through a bank, brokerage firm or other agent will not be voted at the Annual General Meeting. We therefore urge all shareholders who hold their shares through a bank, brokerage firm or other agent to promptly vote their shares in accordance with the instructions provided by their bank, brokerage firm or other agent.

 

You may cast your vote at the AGM by using any one of the following methods:

 

(1)VOTE BY INTERNET – Use the internet (website: www.proxyvote.com) to transmit your voting instructions and for electronic delivery of information prior to the Voter Deadline. Have the proxy materials that you have received in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form.

 

ELECTRONIC DELIVERY OF FUTURE MEETING MATERIALS:

If you would like to reduce the costs incurred by the Company in mailing shareholder meeting materials, you can consent to receiving all future notices of and agendas for shareholders meetings, shareholders circulars and proxy cards electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.

 

(2)VOTE BY PHONE: +1-800-690-6903

Use any touch-tone telephone to transmit your voting instructions prior to the Voter Deadline. Have the proxy materials that you have received in hand when you call and then follow the instructions.

 

 

(3)VOTE BY MAIL: Shareholders who have received an original proxy card in hard copy format may vote by mail. In order to cast your vote by mail please mark, sign and date your proxy card and return it in the envelope we have provided or return it in another envelope, postage prepaid, to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, New York 11717 U.S.A. Proxy cards that are mailed must be received by Broadridge by no later than the Voter Deadline. No postage is required for mailing of the enclosed envelope in the United States.

 

In the future, we may, as permitted by Dutch law, and by United States law for foreign private issuers such as the Company, give notice of annual and extraordinary shareholders meetings solely by way of mailing to our registered shareholders, rather than attempting to distribute shareholder meeting materials to all beneficial owners of the Company’s shares.

 

We will bear the cost of soliciting proxies in relation to the matters to be voted on at the Annual General Meeting. Some of our directors, executive officers and employees may solicit proxies in person or by mail, telephone, fax or email, but will not receive any additional compensation for these services. We may reimburse brokers and others for their reasonable expenses in forwarding proxy solicitation material to the beneficial owners of our shares. We may also retain a proxy solicitation firm to assist in the solicitation of proxies for the Annual General Meeting.

 

 

 

 

Shareholders must prior to 11:59 P.M. United States Eastern Daylight Time on June 6, 2017 give notice in writing to the Company (by email to the following address: AGM2017@mobileye.com, or by other written notice to the Company at its address in Jerusalem, Israel, Attention: General Counsel, which is received by 11:59 P.M. United States Eastern Daylight Time on June 6, 2017) of their intention to attend the Annual General Meeting in person. Admittance of shareholders and acceptance of written voting proxies shall be governed by Dutch law.

 

EXPLANATION OF ITEM 1 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (INFORMATION RELATED TO THE OFFER)

 

Discussion of the Offer at the Annual General Meeting

 

At the Annual General Meeting, representatives of the Company will be available to provide information to the shareholders of the Company concerning the Offer and to answer any questions shareholders may have concerning the Offer. Shareholders will also have the opportunity to discuss the Offer at the Annual General Meeting.

 

Neither the making and consummation of the Offer, nor the execution by the Company of the Purchase Agreement and related documents, requires or required any approval to be obtained from the general meeting of shareholders of the Company. Accordingly, shareholders will not be entitled at the AGM to adopt any resolution of any kind, binding or non-binding, or to cast any vote, including any purely advisory vote, relating to the making or consummation of the Offer, or to the execution by the Company of the Purchase Agreement and related documents.

 

Certain amendments to the Articles in connection with the Offer, and certain means of effectuating the Post-Offer Reorganization to be potentially consummated following the Offer Closing, as well as certain other matters connected with the Offer, are subject to approval by the shareholders of the Company, and shareholders will have an opportunity to vote on these matters at the AGM. See the discussion below of the Offer-Related Resolutions (Items 2 through 6, 10 and 12) on the AGM Agenda.

 

Recommendation of the Company’s Board of Directors

 

After careful consideration, on March 12, 2017 the Board of Directors of the Company (other than the executive directors of the Company, Professor Amnon Shashua and Mr. Ziv Aviram, who abstained, due to conflicts of interest) unanimously (a) determined that the Purchase Agreement and the transactions contemplated thereby (other than (i) certain means of effectuating the Post-Offer Reorganization and (ii) the transactions contemplated by the Tender and Support Agreements (as hereinafter defined) ((i) and (ii) together, the “Excluded Transactions”), as to which the Board of Directors did not reach any conclusion) are in the best interests of the Company, its business and its shareholders, employees and other relevant stakeholders and (b) approved and adopted the Purchase Agreement and approved the transactions contemplated thereby (other than the Excluded Transactions, as to which the Board of Directors did not reach any conclusion).

 

The Board of Directors recommends that the shareholders of the Company accept the Offer and tender their Shares to the Purchaser in the Offer. Furthermore, the Board of Directors recommends that you vote “FOR” each of the Offer-Related Resolutions (Items 2 through 6, 10 and 12 on the AGM Agenda) to be voted on at the AGM.

 

For a detailed explanation of the Board’s reasons for recommending the Offer, see the Solicitation/ Recommendation Statement on Form 14D-9 which was filed by the Company with the SEC on April 5, 2017 and which was mailed to shareholders on or about April 5, 2017 (as it may be amended from time to time, the “Schedule 14D-9”), Item 4(b), “The Solicitation and Recommendation Background of the Purchase Agreement; Reasons for the Recommendation Reasons for the Recommendation of the Board.”

 

 

 

 

On March 12, 2017 Raymond James & Associates Inc. (“Raymond James”) issued an opinion to the Board of Directors of the Company as to the fairness, as of such date, from a financial point of view, to the holders of the Shares of the consideration to be received by such holders pursuant to the Offer as provided in the Purchase Agreement (the “Fairness Opinion”), based upon and subject to the qualifications, assumptions and other matters considered by Raymond James in connection with the preparation of the Fairness Opinion.

 

The full text of the Fairness Opinion is attached as Annex A to the Schedule 14D-9. For additional information concerning the Fairness Opinion, and certain financial relationships between the Company and Raymond James, see the Schedule 14D-9, Items 4(d) and (e), “The Solicitation and Recommendation — Opinion of the Company’s Financial Advisor” and “Certain Unaudited Prospective Financial Information of the Company” and Item 5, “Persons/Assets Retained, Employed, Compensated or Used.”

 

Summary of Key Terms of the Offer and the Purchase Agreement

 

General Introduction

 

The following is a summary of certain key terms of the Offer and the Purchase Agreement. This summary is qualified in its entirety by reference to (i) the Purchase Agreement itself, which was filed by Intel as Exhibit 2.1 to its Current Report on Form 8-K filed with the SEC (SEC File No. 000-06217) on March 13, 2017 (the “Intel 8-K”), and which is incorporated herein by reference, (ii) certain related agreements filed by the Company with the SEC as Exhibits to the Schedule 14D-9, (iii) the Offer to Purchase, mailed to shareholders of the Company by the Purchaser on or about April 5, 2017 (together with the related Letter of Transmittal included therewith, the “Offer to Purchase”) and (iv) the Schedule TO filed by the Purchaser with the SEC on April 5, 2017, including the Exhibits filed therewith (as it may be amended from time to time, the “Schedule TO”).

 

You may read and copy the Schedule TO and the Schedule 14D-9, and the exhibits and amendments thereto, as well as the Purchase Agreement attached as Exhibit 2.1 to the Intel 8-K, at SEC Headquarters at 100 F Street, N.E., Washington, D.C. 20549, U.S.A. Please call the SEC at +1-800-SEC-0330 for further information. Copies of such information may be obtainable by mail, upon payment of the SEC’s customary charges, by writing to the SEC at the address above. The SEC also maintains a website on the Internet at www.sec.gov that contains the Schedule TO and the Schedule 14D-9, and the exhibits and amendments thereto, as well as the Purchase Agreement attached as Exhibit 2.1 to the Intel 8-K, and other information that Intel, the Purchaser and the Company have filed electronically with the SEC. Intel and the Company have also made and will continue to make information relating to the transaction available to the public on http://intelandmobileye.transactionannouncement.com/, which has been and will continue to be used by Intel and the Company to disclose information about the transaction and comply with the SEC’s Regulation FD. This website and the information on or connected to this website are not a part of this Shareholders Circular, are not incorporated herein by reference and should not be considered to be a part of this Shareholders Circular.

 

The summary below does not purport to be complete and additional information concerning the Offer and the Purchase Agreement is included in the Offer to Purchase, the Schedule 14D-9 and the Schedule TO. In particular, these other documents should be consulted for information concerning:

 

·the procedures for tendering Shares in the Offer. See Offer to Purchase, Items 2 and 3, “Acceptance for Payment and Payment for Shares” and “Procedures for Accepting the Offer and Tendering Shares”;

 

·withdrawal rights in respect of the Offer. See Offer to Purchase, Item 4, “Withdrawal Rights”;

 

·certain U.S. and Israeli tax consequences of the Offer. See Offer to Purchase, Item 5, “Certain Tax Consequences”;

 

·recent trading prices of the Shares on the NYSE. See Offer to Purchase, Item 6, “Price Range of Shares; Dividends”;

 

 

 

 

·information provided by the Purchaser concerning the sources of the Purchaser’s funds for financing the Offer. See Offer to Purchase, Item 9, “Source and Amount of Funds”;

 

·a summary description of certain contacts and negotiations leading to the execution of the Purchase Agreement and the making of the Offer. See Offer to Purchase, Item 10, “Background of the Offer; Past Contacts or Negotiations with Mobileye” and Schedule 14D-9, Item 4(b), “Background of the Purchase Agreement Reasons for the Recommendation Background of the Purchase Agreement”;

 

·certain effects of the Offer on the market for the Shares and other related matters. See Offer to Purchase, Item 13, “Certain Effects of the Offer”;

 

·certain antitrust approvals required for the consummation of the Offer. See Offer to Purchase, Item 16, “Certain Legal Matters; Regulatory Approvals” and Schedule 14D-9, Item 8(b), “Regulatory and Other Approvals”; and

 

·certain interests of directors and executive officers of the Company in relation to the Offer that are different from or in addition to those of the Company’s shareholders generally. See Schedule 14D-9, Item 3(a), “Past Contacts, Transactions, Negotiations and Agreements Arrangements with Current Executive Officers and Directors of the Company.”

 

The Purchase Agreement and the Offer

 

The Offer

 

On April 5, 2017, the Purchaser, pursuant to the Offer to Purchase mailed to shareholders of the Company on or around such date, made the Offer to all shareholders of the Company to purchase all of the outstanding Shares of the Company at a purchase price of US$ 63.54 per Share payable in cash, less any applicable withholding taxes and without interest (the “Offer Consideration”), upon the terms and subject to the conditions set forth in the Offer to Purchase.

 

The initial time of expiration of the Offer is 5:00 P.M., New York time, on June 21, 2017, subject to extension as described under “Extension of the Offer” below (the time of expiration of the Offer as extended from time to time, being referred to herein as the “Expiration Time”).

 

The Purchase Agreement

 

The Offer was made pursuant to the Purchase Agreement. The Purchaser under the Purchase Agreement was originally Cyclops. On April 4, 2017, the Purchaser Conversion occurred, as a result of which Cyclops converted from a Delaware corporation into a Delaware limited liability company, which is now the Purchaser under the Offer. The Purchaser Conversion has not adversely impacted, and will not adversely impact, in any respect the Company or any of its shareholders, or the Company’s rights under the Purchase Agreement, and has not relieved, and will not relieve, Cyclops or Intel of their respective obligations under the Purchase Agreement. All references to the “Purchaser” in this Shareholders Circular refer to Cyclops prior to the Purchaser Conversion and to the Purchaser following the Purchaser Conversion.

 

The Purchase Agreement provides, among other things, for various potential means of effectuating a corporate reorganization of the Company (the “Post-Offer Reorganization”), utilizing processes available under Dutch law to (a) ensure that the Purchaser becomes the owner of all of the Company’s business operations from and after the consummation of the Post-Offer Reorganization and (b) use reasonable best efforts to cause any holders of Shares who do not tender their Shares in the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period) to be offered or to receive the same consideration for their Shares as those shareholders who tendered their Shares in the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period), without interest and less applicable withholding taxes, which means of effectuating the Post-Offer Reorganization may include

 

 

 

 

·if the Purchaser acquires at least 95% of the Company’s issued capital in or following the Offer and certain other conditions (as described below) are satisfied, the initiation by the Purchaser of legal proceedings in the Dutch courts for compulsory acquisition of the Shares of the non-tendering shareholders (the “Compulsory Acquisition”) (see “Compulsory Acquisition” below);

 

·subject to receipt of the Pre-Wired Asset Sale Ruling and certain other conditions (as described below), the Asset Sale, followed by the Liquidation and the Second Step Distribution (see the discussion below of Items 2 and 3 on the AGM Agenda);

 

·the election by the Company pursuant to U.S. Treasury Regulations Section 301.7701-3 to be classified as a partnership or as a disregarded entity for U.S. federal tax purposes (the “Partnership Election”); and

 

·the exercise by the Purchaser of the option (the “Call Option”), exercisable after the acceptance by the Purchaser of all Shares validly tendered to it in the Offer, which has been granted to the Purchaser by the Company in the Purchase Agreement, to purchase newly issued ordinary shares of the Company for an amount per ordinary share equal to the Offer Consideration, so as to increase the Purchaser’s ownership of ordinary shares of the Company by 15% of the total number of ordinary shares of the Company then outstanding, after giving effect to the exercise in full of the Call Option (such ordinary shares, in the aggregate, the “Option Shares”) (see “Call Option” below).

 

See “Post-Offer Reorganization,” “The Asset Sale, Liquidation and Second Step Distribution,” “Compulsory Acquisition,” “Alternative Post-Closing Restructurings” and “Call Option” below.

 

Obligation of the Purchaser to Make the Offer

 

The Purchase Agreement provides, among other things, that, subject to the terms and conditions set forth therein, Purchaser will (and Intel will cause Purchaser to), (a) at or as promptly as practicable following the Expiration Time (but in any event within two business days thereafter), accept for payment (the time of acceptance for payment, the “Acceptance Time”) and (b) at or as promptly as practicable following the Acceptance Time (but in any event within three business days (calculated as set forth in Rule 14d-1(g)(3) promulgated under the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”)) thereafter, pay for, all Shares validly tendered pursuant to the Offer and not properly withdrawn as of the Acceptance Time.

 

It is expected that following the Offer Closing, the listing of the Shares on the NYSE will be terminated, the Company will no longer be a publicly traded company, and the Shares will be deregistered under the Exchange Act, resulting in the cessation of the Company’s reporting to the SEC.

 

Conditions of the Offer

 

The obligation of the Purchaser to consummate the Offer is conditioned upon, among other things, (a) the Purchase Agreement not being terminated in accordance with its terms and (b) the satisfaction or waiver (to the extent permitted by the Purchase Agreement and applicable law) of the following conditions:

 

·There shall have been validly tendered to the Purchaser pursuant to the Offer and not withdrawn a number of Shares (excluding Shares tendered pursuant to guaranteed delivery procedures that have not yet been delivered in settlement or satisfaction of such guarantee prior to the Expiration Time) that, together with other Shares then owned by Intel or its affiliates, represents at least 95% (the “Minimum Percentage”) of the Company’s issued capital immediately prior to the Expiration Time (the “Minimum Condition”). The Minimum Percentage may be reduced to less than 95% in the following circumstances:

 

··Intel may, in its sole discretion, at any time reduce the Minimum Percentage from 95% to 80%.

 

 

 

 

··The Minimum Percentage will in any event automatically be reduced to 80% if the ITA issues the Pre-Wired Asset Sale Ruling.

 

··The Minimum Percentage will also in any event further be automatically reduced to 67% if (i) the ITA issues the Pre-Wired Asset Sale Ruling and (ii) the Asset Sale Resolution, the Liquidation Resolution and the Conversion Resolutions are adopted at the AGM or at a subsequent extraordinary general meeting of shareholders of the Company held prior to the Expiration Time (a “Subsequent EGM”).

 

·All applicable waiting periods shall have expired, and all applicable antitrust and other regulatory approvals shall have been obtained, under all applicable antitrust and regulatory laws of the United States, Israel or other applicable jurisdictions (the “Antitrust Clearance Condition”).

 

·There shall be no law, regulation, order or injunction in effect prohibiting, rendering illegal, frustrating or enjoining the consummation of any of the transactions contemplated by the Purchase Agreement (including the consummation of any Post-Offer Reorganization) (a “Legal Restraint”) other than Legal Restraints relating to exercise of the Call Option (the “No Restraints Condition”). If the number of Shares validly tendered to the Purchaser in the Offer (excluding Shares tendered pursuant to guaranteed delivery procedures that have not yet been delivered in settlement or satisfaction of such guarantee prior to the Expiration Time) represents at least 95% of the Company’s issued capital as of the Expiration Time, then the No Restraints Condition will be deemed to be satisfied notwithstanding the fact that there are Legal Restraints in effect at the Expiration Time, if those Legal Restraints relate solely to the consummation of any Post-Offer Reorganization other than the Compulsory Acquisition or the Partnership Election.

 

·The Governance Resolution shall have been adopted at the AGM or a Subsequent EGM.

 

·No fact, change, development, occurrence or effect (each, an “Effect”) shall have occurred that, individually or in the aggregate, would have or would reasonably be expected to have a Company Material Adverse Effect (as defined in the Purchase Agreement and hereinafter) (the “No Material Adverse Effect Condition”). A “Company Material Adverse Effect” is defined by the Purchase Agreement as any Effect that (a) materially adversely affects the business, assets, results of operations or financial condition of the Company and its subsidiaries, taken as a whole or (b) prevents or materially impairs the ability of the Company to consummate the transactions contemplated by the Purchase Agreement. However, the Purchase Agreement provides that none of the following shall be taken into account in determining whether a Company Material Adverse Effect as described in clause (a) of the above definition has occurred:

 

(i)general economic conditions (or changes in such conditions) in the United States, The Netherlands, Israel or any other country or region in the world in which the Company or its subsidiaries conduct business, or conditions in the global economy in general;

 

(ii)changes in any financial, debt, credit, capital, banking or securities markets or conditions;

 

(iii)changes in interest, currency or exchange rates or in the price of any commodity, security or market index;

 

(iv)changes after the date of the Purchase Agreement in applicable law, including any tax law, or the enforcement or interpretation thereof, or in generally accepted accounting principles of the United States of America (“U.S. GAAP”) or other applicable accounting standards (or the enforcement or interpretation thereof);

 

(v)changes in the Company’s and its subsidiaries’ industries in general;

 

 

 

 

(vi)any change in the market price, trading volume or ratings of any securities or indebtedness of the Company or any of its subsidiaries, any change of the ratings or the ratings outlook for the Company or any of its subsidiaries by any applicable rating agency and the consequences of such ratings or outlook decrease, or failure of the Company to meet, or the publication of any report regarding, any internal or public projections, forecasts, guidance, budgets, predictions or estimates of or relating to the Company or any of its subsidiaries (it being understood that the underlying facts and circumstances giving rise to such change or failure may, if not otherwise excluded, be taken into account in determining whether a Company Material Adverse Effect has occurred or will occur);

 

(vii)the continuation, occurrence, escalation, outbreak or worsening of any hostilities, war, police action, acts of terrorism, sabotage or military conflicts, whether or not pursuant to the declaration of an emergency or war;

 

(viii)the execution and delivery of the Purchase Agreement or the announcement or pendency of the transactions contemplated by the Purchase Agreement (including by reason of the identity of the Purchaser), including the impact thereof on the relationships, contractual or otherwise, of the Company and its subsidiaries with employees, customers, vendors, landlords, suppliers or partners (including the termination, suspension, modification or reduction of such relationships);

 

(ix)the existence, occurrence or continuation of any force majeure events, including natural or manmade disasters, any epidemic, pandemic or other similar outbreak or any other national, international or regional calamity;

 

(x)any action brought or threatened by shareholders of the Company (whether on behalf of the Company or otherwise) asserting allegations of breach of fiduciary duty or violations of securities laws in connection with the transactions contemplated by the Purchase Agreement;

 

(xi)any action brought, or that could be brought, by any third party challenging the transactions contemplated by the Purchase Agreement; and

 

(xii)any action expressly required to be taken pursuant to the Purchase Agreement, any action not taken because it was prohibited under the Purchase Agreement (so long as the Company requested in writing Intel’s waiver or consent to take such action and Intel failed to provide such waiver or consent), or any action taken at the express written direction of Intel or the Purchaser;

 

provided that with respect to subclauses (i), (ii), (iii), (iv), (v), (vii) and (ix), Intel or the Purchaser must prove that such Effect disproportionately affects the Company and its subsidiaries, taken as a whole, compared to other similarly situated companies, and then, to the extent not otherwise excluded, only such incremental disproportionate impact or impacts will be taken into account in determining whether there has been, or would reasonably be expected to be, a Company Material Adverse Effect.

 

·(i) Each of the representations and warranties of the Company set forth in the Purchase Agreement relating to the absence of any fact, change, event, development, occurrence or effect that would be expected to have a Company Material Adverse Effect shall continue to be true and correct in all respects as of the Expiration Time, (ii) each of such representations and warranties relating to capital structure shall continue to be true and correct except for de minimis inaccuracies as of the Expiration Time, (iii) each of such representations and warranties relating to corporate existence and power, corporate authorization, validity of and absence of restrictions on, and there being no other Shares, the Company’s subsidiaries, certain intellectual property contracts, finders’ fees and the opinion of the Company’s financial advisor shall continue to be true and correct in all material respects as of the Expiration Time and (iv) each of the other representations and warranties of the Company set forth in the Purchase Agreement shall continue to be true and correct as of the Expiration Time, other than for such failures to be true and correct that would not have or reasonably be expected to have,

 

 

 

 

individually or in the aggregate, a Company Material Adverse Effect ((i) through (iv) together the “Representations and Warranties Condition”).

 

·The Company shall have performed or complied with in all material respects the obligations that it is required to comply with or perform under the Purchase Agreement at or prior to the Expiration Time (the “Covenant Compliance Condition”).

 

·The Resigning Directors shall have resigned from the Company’s Board of Directors effective as of the Offer Closing.

 

·The Company shall have delivered to Intel a certificate signed by an authorized officer of the Company, dated as of the date on which the Offer expires, certifying that the No Material Adverse Effect Condition, the Representations and Warranties Condition and the Covenant Compliance Condition have been satisfied.

 

Certain Agreements of the Purchaser Relating to the Offer

 

The Purchaser has agreed in the Purchase Agreement that it will not, without the consent of the Company:

 

·waive the Minimum Condition or change the Minimum Percentage, except for permitted reductions of the Minimum Percentage as described above;

 

·decrease the Offer Consideration;

 

·change the form of the Offer Consideration to be paid in the Offer;

 

·decrease the number of Shares sought to be acquired by the Purchaser in the Offer;

 

·extend or change the Expiration Time, except as provided in the Purchase Agreement (see “Extension of the Expiration Time” below);

 

·impose additional conditions to the Offer; or

 

·otherwise modify, amend or supplement any condition to or term of the Offer in a manner that is adverse to the shareholders of the Company.

 

Extension of the Expiration Time

 

The Purchaser may extend the Offer to such other date and time as may be agreed in writing by the Company and Intel, and will extend the Offer for the minimum period required by applicable law, the SEC, or the rules of the NASDAQ Global Select Market (“NASDAQ”) or the NYSE. If at the Expiration Time any condition to the Offer is not satisfied, the Purchaser is also required by the Purchase Agreement to extend the Expiration Time by successive periods of 10 business days each, in order to permit satisfaction of such condition. However,

 

·If the Antitrust Clearance Condition is not satisfied as of any scheduled Expiration Time, the Purchaser may extend the Expiration Time by a period of up to 20 (rather than 10) business days, if the Purchaser determines in good faith, after consultation with its outside legal counsel, that at any then-scheduled Expiration Time the Antitrust Clearance Condition is not reasonably likely to be satisfied within a 10 business day extension period.

 

·If the sole remaining unsatisfied condition as of any scheduled Expiration Time is the Minimum Condition, and either (i) the Pre-Wired Asset Sale Ruling has been obtained, or (ii) Intel determines in its reasonable judgment that the Pre-Wired Asset Sale Ruling will not be obtained, the Purchaser

 

 

 

 

will not be required to extend the Offer by more than two consecutive periods of 10 business days each.

 

·The Purchaser is not required to extend the Offer at any time that Intel or the Purchaser is permitted to terminate the Purchase Agreement.

 

The Purchaser will not in any event be required to extend the Offer beyond March 12, 2018 (the “End Date”). However, if as of the End Date all of the conditions to the Offer other than the Antitrust Clearance Condition have been satisfied, the End Date will be automatically extended first to June 10, 2018 and then again (if as of June 10, 2018 all conditions to the Offer are satisfied other than the Antitrust Clearance Condition) until September 8, 2018.

 

The initial Expiration Time is 5:00 P.M., New York time, on June 21, 2017. The Company does not presently anticipate that all of the conditions to the Offer will be satisfied as of such time and accordingly the Purchaser is expected to be required to extend the Offer beyond that time in accordance with the provisions described above.

  

The AGM and Subsequent EGM

 

In the Purchase Agreement the Company undertakes to hold the AGM and to recommend to shareholders at the AGM the approval of the Offer-Related Resolutions. In the event that any of the Offer-Related Resolutions are not approved by the requisite shareholder vote at the AGM (see “Vote Required to Approve the Items on the AGM Agenda” above in the introduction to this Shareholders Circular), the Company has further undertaken to convene the Subsequent EGM, at which shareholders will be afforded the opportunity to reconsider and again vote on those Offer-Related Resolutions which are not adopted by the requisite shareholder vote at the AGM.

 

The Company has further undertaken in the Purchase Agreement to recommend the acceptance of the Offer in the Schedule 14D-9, this Shareholders Circular and otherwise, and not to revoke, withdraw or modify that recommendation unless the Purchase Agreement is terminated in accordance with its terms.

 

The Subsequent Offering Period and the Minority Exit Offering Period

 

Following the Acceptance Time in accordance with the Purchase Agreement, the Purchaser will provide for a subsequent offering period of at least 10 business days in accordance with Rule 14d-11 under the Exchange Act (the “Subsequent Offering Period”). In the event that prior to the expiration of the Subsequent Offering Period, the Purchaser or one of its affiliates has elected to (a) exercise the Call Option or (b) effectuate the Asset Sale, the Purchaser will extend the Subsequent Offering Period for at least five business days (the “Minority Exit Offering Period”). During the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period, shareholders of the Company will have an additional opportunity to tender their Shares to the Purchaser, in accordance with procedures to be subsequently announced by the Purchaser prior to the beginning of the Subsequent Offering Period. See the discussion below of Item 5 on the AGM Agenda, “Proposed Amendments to the Company’s Articles of Association – Requirement of a Notarial Deed for Transfer of Shares” for a description of certain administrative formalities that may, under certain circumstances, be required under Dutch law for the tender of Shares to the Purchaser during the Subsequent Offering Period and the Minority Exit Offering Period.

 

Israeli Withholding Tax

 

Generally, the receipt of cash in exchange for Shares pursuant to the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period) or the Post-Offer Reorganization will be considered an Israeli source transaction for Israeli income tax purposes and may be subject to mandatory withholding requirements.

 

 

 

 

The Company and the Purchaser have obtained the Israeli Equity Tax Ruling with respect to withholding requirements under the Ordinance, in order to exempt shareholders who are not Israeli residents, as determined under the Ordinance, from Israeli withholding tax obligations, subject to the conditions described below and the submission of non-Israeli residency declarations. The Shares held by shareholders who do not tender their Shares pursuant to the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period) may be acquired by the Purchaser in the Compulsory Acquisition. If such shareholders have not submitted the required non-Israeli residency declaration by the time payment for such Shares is made, the Purchaser may need to withhold tax from the consideration payable to such shareholders at the full default withholding rate pursuant to Israeli law.

 

The Israeli Equity Tax Ruling provides, among other things, that (1) payments made to non-Israeli brokers with respect to tendering shareholders of the Company who certify that they (a) hold less than 5% of the outstanding Shares, (b) acquired their Shares on or after January 1, 2009 and (c) are currently, and at the time they acquired their Shares, non-Israeli residents for Israeli tax purposes, and provide the required signed declarations to such effect, will be exempt from Israeli withholding tax; (2) payments made to eligible Israeli brokers or Israeli financial institutions with respect to tendering shareholders of the Company who hold less than 5% of the outstanding Shares and acquired their Shares on or after January 1, 2009, will be exempt from Israeli withholding tax by the Purchaser, and the relevant Israeli broker or Israeli financial institution will withhold Israeli tax, as required under Israeli law; and (3) payments made with respect to tendering shareholders of the Company not described in clauses (1) and (2) above will be subject to Israeli withholding tax (generally at the rate of 25% for individuals and 24% for corporations), unless they provide a valid certificate issued by the ITA providing for an exemption from withholding or for a reduced withholding tax rate that will be in effect as of the date of actual payment for the sale of Shares. According to the terms of the Israeli Equity Tax Ruling, such valid certificate must specifically relate to the sale of Shares and a general exemption for “services and assets” may not be relied upon for an exemption or reduced rate of withholding. Once the Offer Closing occurs and the sale of Shares is confirmed, there will be no further opportunity to provide a valid certificate or remedy any deficiencies in a certificate that has already been provided, including in the event that a certificate limited in time is no longer in effect as of the date of payment.

 

The applicable withholding taxes (including Israeli dividend withholding taxes) and other taxes, if any, imposed on shareholders of the Company who do not tender their Shares pursuant to the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period) may be different from, and greater than, the taxes imposed upon such shareholders had they tendered their Shares pursuant to the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period).

 

Treatment of Equity Awards

 

At the Offer Closing, each restricted share unit issued by the Company pursuant to the Company’s equity compensation plans (each, a “Company RSU”) that is outstanding as of immediately prior to the Offer Closing and either (a) held by a person other than an employee who continues his or her employment with the Company or any of its subsidiaries at the Offer Closing (a “Continuing Employee”), whether vested or unvested, (b) vested in accordance with the terms of the applicable Company equity compensation plan and award agreement evidencing such Company RSU as of immediately prior to the Offer Closing and for which Shares have not yet been issued, (c) that, in the absence of the Offer and the other transactions contemplated by the Purchase Agreement, would become vested within two years following the Offer Closing and are held by a Continuing Employee whose employment or service with the Company commenced prior to the date of the Purchase Agreement or (d) is subject to accelerated vesting solely as a result of the completion of the Offer and the other transactions contemplated by the Purchase Agreement in accordance with the terms thereof (each, a “Terminating RSU”), will, without any action on the part of Intel, the Purchaser, the Company, the holder thereof or any other person, be accelerated and converted into and will become a right to receive an amount in cash, without interest, equal to the product obtained by multiplying (x) the Offer Consideration by (y) the total number of Shares subject to such Company RSU. Any payment with respect to a Terminating RSU will be subject to all applicable United States federal, state and local tax withholding requirements, and, with respect to Israeli employees, in accordance with the terms and conditions of the Israeli Equity Tax Ruling as described

 

 

 

 

above and any specific tax ruling relating to the treatment of equity awards granted to Israeli employees which may be obtained by the Company.

 

At the Offer Closing, each Company RSU that is outstanding as of immediately prior to the Offer Closing and that is not a Terminating RSU will, without any action on the part of Intel, the Purchaser, the Company, the holder thereof or any other person, be converted into an equity award subject to the same terms and conditions applicable to such Company RSU (including the same vesting schedule and terms regarding acceleration and forfeiture upon termination of employment or service) immediately prior to the Offer Closing with respect to a number of shares of common stock (rounded down to the nearest whole share) of Intel equal to (a) the number of Shares subject to such Company RSU immediately prior to the Offer Closing multiplied by (b) the quotient obtained by dividing (x) the Offer Consideration by (y) the average closing price of the common stock of Intel on NASDAQ for the five consecutive trading days ending on the trading day immediately preceding the date of the Offer Closing (such quotient, the “Equity Award Adjustment Ratio”). The terms and conditions applicable to certain of these Company RSUs will be modified as agreed to by the parties on the date of the Purchase Agreement.

 

At the Offer Closing, each option to acquire Shares granted by the Company pursuant to a Company equity compensation plan (each, a “Company Option”) that is outstanding as of immediately prior to the Offer Closing and either (a) held by a person other than a Continuing Employee, whether vested or unvested, (b) held by certain persons identified by the Purchaser, Intel and the Company on the date of the Purchase Agreement, whether vested or unvested, (c) vested in accordance with the terms of the applicable Company equity compensation plan and award agreement evidencing such Company Option as of immediately prior to the Offer Closing, (d) that, in the absence of the Offer and the other transactions contemplated by the Purchase Agreement, would become vested within two years following the Offer Closing and are held by a Continuing Employee whose employment or service with the Company commenced prior to the date of the Purchase Agreement or (e) is subject to accelerated vesting solely as a result of the completion of the Offer and the other transactions contemplated by the Purchase Agreement in accordance with the terms thereof (of which there are none) (each, a “Terminating Option”), will, without any action on the part of Intel, the Purchaser, the Company, the holder thereof or any other person, be accelerated (if required) and converted into and will become a right to receive an amount in cash, without interest, equal to the product of (x) the excess, if any, of the Offer Consideration over the applicable per Share exercise price of such Company Option multiplied by (y) the number of Shares subject to such Company Option. Each Terminating Option that is outstanding and unexercised immediately prior to the Offer Closing that has an exercise price equal to or greater than the Offer Consideration will be cancelled as of the Offer Closing without consideration therefor and the holder of such Terminating Option will cease to have any rights with respect thereto. Any payment with respect to a Terminating Option will be subject to all applicable United States federal, state and local tax withholding requirements, and, with respect to Israeli employees, in accordance with the terms and conditions of the Israeli Equity Tax Ruling as described above and any specific tax ruling relating to the treatment of equity awards granted to Israeli employees which may be obtained by the Company.

 

At the Offer Closing, each Company Option that is outstanding as of immediately prior to the Offer Closing and that is not a Terminating Option, will, without any action on the part of Intel, the Purchaser, the Company, the holder thereof or any other person, be converted into an option to purchase, subject to the same terms and conditions as applied to such Company Option (including the same vesting schedule and terms regarding acceleration and forfeiture upon termination of employment or service) immediately prior to the Offer Closing, a number of shares of common stock (rounded down to the nearest whole share) of Intel equal to (w) the number of Shares subject to such Company Option immediately prior to the Offer Closing multiplied by (x) the Equity Award Adjustment Ratio, with an exercise price per share (rounded up to the nearest whole United States dollar cent) equal to (y) the exercise price per Share for which such Company Option was exercisable immediately prior to the Offer Closing divided by (z) the Equity Award Adjustment Ratio. The terms and conditions applicable to certain of these Company Options will be modified as agreed to by the parties on the date of the Purchase Agreement.

 

 

 

 

Right to Terminate the Purchase Agreement in Order to Accept a Superior Proposal; Non-Solicitation

 

The Company will, subject to certain conditions described below, generally have the right to terminate the Purchase Agreement in order to accept a “Superior Proposal” to acquire the Company from a competing bidder. A “Superior Proposal” is defined for purposes of the Purchase Agreement as an unsolicited written offer by a competing bidder, which did not result from a breach of the Company’s non-solicitation obligations under the Purchase Agreement, to acquire 50% of the Company’s shares, or assets of the Company representing 50% or more in value of the consolidated revenues, net income or assets of the Company, which the Company’s Board of Directors has determined in good faith (after consultation with its outside legal counsel and financial advisors), taking into account all legal, financial, regulatory, financing, certainty, timing, and other relevant aspects of the proposal, and the person making the proposal:

 

·provides for a cash purchase price of at least US$ 69.894 per Share;

 

·is more favourable to the Company and its subsidiaries, employees and other stakeholders than the Offer;

 

·is reasonably likely to be consummated; and

 

·to the extent that third party financing is required, such financing is then fully committed.

 

In response to any Superior Proposal, the Board of Directors may prior to the Expiration Time terminate the Purchase Agreement to enter into a definitive agreement with respect to such Superior Proposal, if the Board of Directors determines in good faith, after consultation with outside legal and financial advisors, that the failure to accept such Superior Proposal (taking into account any revised terms proposed by Intel and the Purchaser during the four business day period described below), and to terminate the Purchase Agreement, would constitute a breach of the Board’s fiduciary duties under Dutch law. Upon termination of the Purchase Agreement, the Purchaser would then be obligated to terminate the Offer and to return any Shares that have been tendered to it.

 

If the Company’s Board of Directors wishes to terminate the Purchase Agreement in order to accept a Superior Proposal, it must first give Intel and the Purchaser four business days’ prior written notice of this fact, including an unredacted copy of the transaction agreement and all other material documents relating to the Superior Proposal, and must during the four business day period following such notice engage in good faith negotiations with Intel and the Purchaser to amend the Purchase Agreement in such a manner that the alternative acquisition agreement no longer constitutes a Superior Proposal. Any amendment to the financial terms or other material terms and conditions of a proposal that may constitute a Superior Proposal will require a new notice to be given and a new four business day negotiation period to be observed as described above.

 

Prior to termination of the Purchase Agreement, the Company is subject to various non-solicitation obligations, including that the Company may not solicit, initiate, knowingly facilitate, knowingly induce or encourage (including by providing information, cooperation or assistance) any inquiry, proposal, indication of interest, or offer from any third party, for an acquisition of 20% or more of the Company’s shares, or assets of the Company representing 20% or more in value of the Company’s consolidated revenues, net income or assets (an “Alternative Acquisition Proposal”).

 

If the Company receives an unsolicited Alternative Acquisition Proposal, it may, if (i) the Company’s Board of Directors determines in good faith, after consultation with its outside legal counsel and financial advisors, that such Alternative Acquisition Proposal constitutes, or would be reasonably expected to lead to, a Superior Proposal, (ii) the submission of such Alternative Acquisition Proposal did not result from or arise in connection with a breach of the Company’s non-solicitation obligations and (iii) the Company’s Board of Directors determines in good faith, after consultation with outside legal and financial advisors, that failure to take any of the actions listed below would be inconsistent with the Board’s fiduciary duties under Dutch law:

 

·furnish non-public information to the person making the Alternative Acquisition Proposal, subject to receipt of a confidentiality agreement which is at least as restrictive as the confidentiality agreement

 

 

 

 

entered into between the Company and Intel prior to execution of the Purchase Agreement and which does not restrict the Company’s ability to comply with the Purchase Agreement; in addition, any non-public information disclosed to the person making the Alternative Acquisition Proposal must also be furnished to Intel and the Purchaser if not previously furnished to them; and

 

·engage in discussions or negotiations relating to the relevant Alternative Acquisition Proposal.

 

The Company must provide Intel and the Purchaser with certain relevant details relating to any Alternative Acquisition Proposal, or information request that would reasonably be expected to lead to any Alternative Acquisition Proposal, within 24 hours of receipt thereof, and thereafter keep Intel and the Purchaser informed on a reasonably current basis regarding the status of any discussions relating to such Alternative Acquisition Proposal, including (i) providing Intel and the Purchaser, within 24 hours from receipt, of all written proposals and transaction agreements relating to such Alternative Acquisition Proposal and (ii) providing Intel and the Purchaser with 48 hours prior notice (or such lesser notice as is provided to members of the Company’s Board of Directors) of any meeting of the Company’s Board of Directors at which the Company’s Board of Directors is reasonably expected to consider such Alternative Acquisition Proposal.

 

For additional details concerning the Company’s non-solicitation obligations under the Purchase Agreement, and concerning the rights of the Company, Intel or the Purchaser to terminate the Purchase Agreement other than following acceptance by the Company of a Superior Proposal, and the effects of such termination of the Purchase Agreement, see the Offer to Purchase, Item 11, “The Purchase Agreement; Other Agreements The Purchase Agreement No Solicitation,” “Termination of the Purchase Agreement” and “Effect of Termination.”

 

Composition of the Board of Directors after the Offer Closing

 

After the Offer Closing the Company’s Board of Directors is expected to consist of five directors who may not be independent of Intel and the Purchaser (expected to be Tiffany D. Silva, David J. Miles, Nicholas J. Hudson, Mark L. Legaspi and Gary Kershaw see the discussion below of Item 12 on the AGM Agenda) and the two Independent Directors, Eyal Desheh and Peter Seth Neustadter, who are independent of Intel and the Purchaser. In the event that one of the Independent Directors ceases for any reason to serve on the Board of Directors prior to the end of his term, as provided in the next sentence, Intel and the Purchaser will procure that he will be replaced by a new Independent Director who is independent of Intel and the Purchaser. The Independent Directors will continue in office until the first to occur of (i) the Company becoming a wholly-owned subsidiary of the Purchaser, or of an affiliate of the Purchaser and (ii) the occurrence of the Liquidation following the Asset Sale Completion.

 

The affirmative vote of the Independent Directors will be required for approving (a) any restructuring (including any Post-Offer Reorganization) that could reasonably be expected to lead to a dilution of the shareholdings of the non-tendering shareholders of the Company, other than (i) pursuant to a rights issue by the Company, or any other share issue, where the non-tendering shareholders have been offered an opportunity to subscribe pro rata to their then existing shareholding in the Company (voorkeursrecht), (ii) subject to receipt of the Pre-Wired Asset Sale Ruling, the Asset Sale, the Liquidation or the Second Step Distribution, (iii) the Compulsory Acquisition or (iv) the Call Option, and (b) any other form of unequal treatment (including as a result of a Post-Offer Reorganization) that prejudices or could reasonably be expected to prejudice or negatively affect the value of the Shares, or the voting rights attached to the Shares, held by the non-tendering shareholders of the Company, other than (i) subject to receipt of the Pre-Wired Asset Sale Ruling, the Asset Sale, the Liquidation or the Second Step Distribution, (ii) the Compulsory Acquisition or (iii) the Call Option (each of (a) and (b), an “Independent Director Approval Transaction”).

 

Post-Offer Reorganization

 

As promptly as practicable following the closing of the Subsequent Offering Period (as it may be extended by the Minority Exit Offering Period), Intel or the Purchaser may effectuate, or cause to be effectuated, and the Company and its subsidiaries shall effectuate, at Intel’s or the Purchaser’s election, the Post-Offer Reorganization. The Post-Offer Reorganization will utilize processes available to the Purchaser under Dutch

 

 

 

 

law to (a) ensure that the Purchaser becomes the owner of all of the Company’s business operations from and after the consummation of the Post-Offer Reorganization and (b) use reasonable best efforts to cause any shareholders of the Company who do not tender their Shares pursuant to the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period) to be offered or to receive the same consideration for their Shares as those shareholders who tendered their Shares pursuant to the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period), without interest and less applicable withholding taxes.

 

In order for the Purchaser to become the owner of all the Company’s business operations from and after the consummation of the transactions or series of transactions referred to below, as promptly as practicable following the closing of the Subsequent Offering Period (as it may be extended by the Minority Exit Offering Period), the Purchaser has announced that it intends to effectuate either (A) if permissible under applicable law, the Compulsory Acquisition or (B) the Asset Sale, followed by the Liquidation and the Second Step Distribution, subject to (x) the receipt of the Pre-Wired Asset Sale Ruling and the adoption of the Asset Sale Resolution, the Liquidation Resolution and the Conversion Resolutions by the Company’s shareholders at the AGM or a Subsequent EGM and (y) the satisfaction of all other conditions precedent to the consummation of the Asset Sale. Intel and the Purchaser have stated that they will continue to review the structural, tax and other implications for Intel, the Purchaser and the Company associated with the election of either of such options as well as the availability of each such option under applicable law.

 

It is possible that the Purchaser may not be able to implement any proposed means of effectuating the Post-Offer Reorganization promptly after the Offer Closing, that such Post-Offer Reorganization may be delayed or that the Post-Offer Reorganization may not be able to take place at all. Any Post-Offer Reorganization could be the subject of litigation, and a court could delay the Post-Offer Reorganization or prohibit it from occurring on the terms described in this Shareholders Circular or the Offer to Purchase, or from occurring at all. Moreover, even if the Purchaser is able to effect any proposed Post-Offer Reorganization, the consideration that the Company shareholders receive therefrom may be substantially lower and/or different in form than the consideration that they would have received had they tendered their Shares in the Offer (and they may also be subject to additional taxes).

 

The Asset Sale, Liquidation and Second Step Distribution

 

For a detailed description of the Asset Sale, Liquidation and Second Step Distribution, see the discussion below of Items 2 and 3 on the AGM Agenda.

 

Compulsory Acquisition

 

If the Purchaser is the holder of 95% or more of the Company’s issued capital, and the Purchaser and Intel elect to have the Purchaser commence the Compulsory Acquisition, the Purchaser would then complete the Post-Offer Reorganization by commencing proceedings for the Compulsory Acquisition, which is a statutory proceeding in accordance with Section 2:92a or Section 2:201a of the DCC before the Enterprise Chamber (Ondernemingskamer) of the Court of Appeals (Gerechtshof) of Amsterdam, The Netherlands (the “Dutch Court”) for the compulsory acquisition of Shares held by non-tendering shareholders. While Intel and the Purchaser will use their reasonable best efforts to cause the per Share price paid in the Compulsory Acquisition to be equal to the Offer Consideration, the Dutch Court has sole discretion to determine such per Share price, which may be greater than, equal to or less than the Offer Consideration. Any dividend or other distribution made by the Company to shareholders during the period following initiation of the Compulsory Acquisition proceeding will be credited against the amount to be paid by the Purchaser to the non-tendering shareholders. The Dutch Court may appoint one or three experts to provide a valuation of the Shares that were not tendered pursuant to the Offer. Upon execution (tenuitvoerlegging) of the Dutch Court’s ruling in the Compulsory Acquisition, each non-tendering shareholder will receive the Dutch Court-determined per Share price and the Purchaser will become the sole shareholder of the Company.

 

The Dutch Court-determined per Share price may potentially be increased by statutory interest accrued at the then applicable statutory legal interest rate applicable in The Netherlands (currently 2% per annum) (“Dutch Statutory Interest”). The period for the calculation of the Dutch Statutory Interest would begin either (i) on

 

 

 

 

the date on which the Offer Consideration became payable to shareholders of the Company who tendered their Shares to the Purchaser in the Offer (the “Offer Payment Date”), provided that the Purchaser acquired at least 95% of the Company’s issued capital as of the Offer Payment Date or (ii) under certain circumstances, including when the Purchaser did not acquire at least 95% of the Company’s issued capital as of the Offer Payment Date, from the date when the Dutch Court renders a judgment allowing the claim for the Compulsory Acquisition against the non-tendering shareholders for all of their non-tendered Shares. The end of the period for the calculation of the Dutch Statutory Interest would be the date when the Purchaser pays for the Shares then owned by the non-tendering shareholders.

 

Alternative Post-Closing Restructurings

 

The Purchase Agreement provides that Intel or the Purchaser may also effectuate (and cause the Company to effectuate) the Post-Offer Reorganization by means of any of the following, as an alternative to the Compulsory Acquisition, or the Asset Sale, Liquidation and Second Step Distribution (each an “Alternative Post-Closing Restructuring”):

 

·the Partnership Election;

 

·the exercise of the Call Option;

 

·a statutory legal merger (juridische fusie) in accordance with Article 2:309 et seq. of the DCC between the Company (as the disappearing company) and an affiliate of the Purchaser (as the acquiring company) (the “Acquiring Company”), pursuant to which merger the shareholders of the Company will receive shares of the Acquiring Company (“Acquiring Company Shares”), cash or receivables in accordance with Section 2:325 of the DCC (or a mix of any of the foregoing), and upon which merger the holders of the Acquiring Company Shares will be granted the right to exchange Acquiring Company Shares with Intel or one of its affiliates, for securities of Intel at any time before a date to be set by Intel or the Purchaser, after which date the Acquiring Company Shares will be redeemed;

 

·a statutory (cross-border or domestic) legal (bilateral or triangular) merger (juridische (driehoeks-fusie)) in accordance with Section 2:309 et seq. of the DCC between the Company, an affiliate of the Purchaser or any affiliate of Intel;

 

·a statutory legal (bilateral or triangular) demerger (juridische (driehoeks-) splitsing) of the Company in accordance with Section 2:334a et seq. of the DCC;

 

·a contribution of cash and/or assets by the Purchaser, Intel or by any affiliate of Intel in exchange for ordinary shares in the Company’s share capital, in which circumstances the pre-emptive rights (voorkeursrechten), if any, of the minority shareholders of the Company could be excluded;

 

·a sale and transfer of assets and liabilities (a) by the Company or a subsidiary of the Company to Purchaser, Intel or an affiliate of Intel or (b) by the Purchaser, Intel or any affiliate of Intel to the Company or any subsidiary of the Company, on terms substantially similar to the terms agreed for the Asset Sale to the extent this relates to substantially all of the assets and liabilities of the Company and its subsidiaries;

 

·a distribution of proceeds, cash and/or assets to the shareholders of the Company or share buybacks;

 

·a dissolution and/or liquidation of the Company;

 

·a subsequent public offer for any Shares held by the minority shareholders of the Company;

 

·a conversion of the Company into a B.V. under Dutch law;

 

 

 

 

·any transactions between the Company and Intel or the Purchaser or their respective affiliates on terms that are not at arm’s length;

 

·any transaction, including a sale and/or transfer of any material asset, between the Company and its affiliates or between the Company and Intel or the Purchaser or their respective affiliates with the objective of utilizing any carry forward tax losses available to the Company, Intel, the Purchaser or any of their respective affiliates;

 

·any transactions, restructurings, share issues, procedures and/or proceedings in relation to the Company and/or one or more of its affiliates required to effect the aforementioned transactions; and

 

·any combination of the foregoing.

 

To undertake any Alternative Post-Closing Restructuring (other than the exercise of the Call Option or the Partnership Election), Intel or the Purchaser would have to receive the prior written consent of the Company (not to be unreasonably withheld, conditioned or delayed), which consent would require the affirmative vote of the Independent Directors if the proposed Alternative Post-Closing Restructuring constitutes an Independent Director Approval Transaction as described above at “Composition of the Board of Directors after the Offer Closing.”

 

Call Option

 

The Company has granted the Purchaser the Call Option, which is an irrevocable option to purchase such number of newly issued ordinary shares of the Company, within the limits of the Company’s authorized but unissued share capital at the time of issuance, so as to increase the Purchaser’s ownership of ordinary shares of the Company by 15% of the total ownership of ordinary shares of the Company outstanding, after giving effect to the exercise in full of the Call Option, in exchange for an amount per ordinary share equal to the Offer Consideration. The Call Option is exercisable one time, in whole or in part, following the Acceptance Time and no later than the last day of the Subsequent Offering Period (as it may be extended by the Minority Exit Offering Period, if applicable). The Call Option terminates concurrently with the termination of the Purchase Agreement. The Purchaser can pay for the Option Shares at its sole election, subject to compliance with mandatory provisions of Dutch law, by (a) wire transfer of immediately available funds to a bank account designated at least three business days in advance by the Company, (b) issuance by the Purchaser to the Company of a promissory note in favor of the Company, guaranteed by Intel or a creditworthy subsidiary of Intel, (c) contribution in kind (inbreng in natura) in accordance with Section 2:94b or (if applicable) 2:204b of the DCC by the Purchaser to the Company by way of the assignment by the Purchaser to the Company of a promissory note issued by Intel or a creditworthy subsidiary of Intel in favor of the Purchaser or (d) any combination of clauses (a) through (c). Intel and the Purchaser will jointly and severally pay all expenses, and any and all federal, state, Israeli and local taxes and other charges in any jurisdiction, that may be payable in connection with the issuance of the Option Shares including any relevant deeds of issuance in the name of the Purchaser or its permitted assignee, transferee or designee.

 

Other Provisions of the Purchase Agreement

 

The Purchase Agreement contains certain representations and warranties of the Purchaser, Intel and the Company. See Offer to Purchase, Item 11, “The Purchase Agreement; Other Agreements The Purchase Agreement Representations and Warranties.” All of the representations and warranties contained in the Purchase Agreement will expire as of the Acceptance Time.

 

In addition, the Purchase Agreement provides for various restrictions on the conduct of the business of the Company and its subsidiaries during the period between the signing of the Purchase Agreement and the Offer Closing. See Offer to Purchase, Item 11, “The Purchase Agreement; Other Agreements The Purchase Agreement Conduct of Mobileye Pending the Offer Closing.”

 

For a description of certain provisions of the Purchase Agreement relating to the obligation of Intel to continue to provide directors’ and officers’ liability insurance for the Company’s directors and executive officers after

 

 

 

 

the Offer Closing, certain employee matters after the Offer Closing and certain matters relating to obtaining antitrust and other regulatory approvals, and to litigation relating to the Offer and the Purchase Agreement, see the Offer to Purchase, Item 11, “The Purchase Agreement; Other Agreements The Purchase Agreement Directors and Officers Liability,” “Employee Matters,” “Regulatory Approvals; Efforts” and “Litigation.”

 

Governing Law; Specific Performance

 

The Purchase Agreement will be governed by and construed in accordance with the laws of the State of Delaware, except that any matters concerning or implicating the Board of Director’s fiduciary duties will be governed by and construed in accordance with Dutch law. The Purchase Agreement provides that all actions arising in connection with or relating to the Purchase Agreement will be brought, tried and determined only in certain designated courts located within the State of Delaware.

 

The parties to the Purchase Agreement are entitled to obtain an order by a court for specific performance of their respective obligations under the Purchase Agreement, in addition to any other remedy to which they are entitled at law or in equity. See Offer to Purchase, Item 11, “The Purchase Agreement; Other Agreements The Purchase Agreement Specific Performance.”

 

Certain Other Agreements

 

The following is a description of the key provisions of certain other agreements entered into in connection with the Purchase Agreement.

 

Tender and Support Agreements

 

The following summary description of the Tender and Support Agreements (as defined below) and all other provisions of the Tender and Support Agreements discussed herein are qualified by reference to such Tender and Support Agreements, which have been filed as Exhibits (d)(4) and (d)(5) to the Schedule TO filed with the SEC by the Purchaser in connection with the Offer and are incorporated herein by reference. The Tender and Support Agreements may be examined and copies may be obtained at the places and in the manner set forth under “General Introduction” above. Shareholders and other interested parties should read the Tender and Support Agreements for a more complete description of the provisions summarized below.

 

Concurrently with the execution of the Purchase Agreement, in order to induce Intel and the Purchaser to enter into the Purchase Agreement, the Company’s founders, Professor Amnon Shashua and Mr. Ziv Aviram (the “Founders”), entered into separate tender and support agreements with Intel and the Purchaser (collectively, the “Tender and Support Agreements”). Shares owned by the Founders comprise, in the aggregate, approximately 7% of the outstanding Shares. Subject to the terms and conditions of the Tender and Support Agreements, the Founders have agreed, among other things, to tender their Shares in the Offer and to vote in favor of all of the Offer-Related Resolutions at the AGM, and any Subsequent EGM that may be held. The Founders have also agreed from the date of the Purchase Agreement until six months following any termination of the Purchase Agreement (a) not to tender their Shares or vote in favor of any Alternative Acquisition Proposal and (b) not to solicit competing proposals or transfer any of their Shares without the prior written consent of Intel (subject to certain permitted exceptions).

 

Non-Competition Agreement

 

The following summary description of the Non-Competition Agreement (as defined below) and all other provisions of the Non-Competition Agreement discussed herein are qualified by reference to such Non-Competition Agreement, which has been filed as Exhibit (d)(6) to the Schedule TO filed by the Purchaser with the SEC in connection with the Offer and is incorporated herein by reference. The Non-Competition Agreement may be examined and copies may be obtained at the places and in the manner set forth under “General Introduction” above. Shareholders and other interested parties should read the Non-Competition Agreement for a more complete description of the provisions summarized below.

 

 

 

 

Concurrently with the execution of the Purchase Agreement, in order to preserve the value of and goodwill associated with the Shares being acquired and as a condition of and inducement to Intel’s and the Purchaser’s willingness to enter into the Purchase Agreement, Professor Amnon Shashua entered into a non-competition agreement in favor of Intel (the “Non-Competition Agreement”).

 

Pursuant to the Non-Competition Agreement, if Professor Shashua’s separation from employment with the Company occurs within three years of the Offer Closing, then during the period beginning at the Offer Closing and ending on the date that is 18 months after Professor Shashua’s separation from employment with the Company (the “Restricted Period”), Professor Shashua will be bound by covenants not to compete with Intel, not to disparage the Company, Intel or any of their affiliates, and not to solicit the employees of Intel, the Company or their affiliates.

 

Specifically, pursuant to the covenant not to compete contained in the Non-Competition Agreement, during the Restricted Period, Professor Shashua will not: (a) engage in research, development or commercialization of any technologies, products or services that are competitive with the Company’s business anywhere that the Company is currently engaged in, or targeting to engage in, its business, including in the United States and Israel; (b) have an ownership or financial interest in any person or entity engaged in the Company’s business anywhere that the Company is currently engaged in, or targeting to engage in, its business, including in the United States and Israel, other than an up to a 1% passive ownership interest in a publicly traded company; (c) take any action with the objective of, or that would reasonably be expected to result in, interfering with or negatively affecting Intel’s business; (d) solicit or attempt to solicit the business of any person or entity that is, or was within the 12 months prior to such solicitation, a customer or client of Intel, for the purpose of selling any products or services that are competitive with the Company’s business; (e) solicit or attempt to solicit any employee or any other service provider of Intel or any of its related entities to terminate employment or engagement with Intel, or otherwise adversely affect such individual’s relationship; or (f) encourage any employee or other service provider of Intel or any of its related entities to engage in any action in which Professor Shashua would, under the provisions of the Non-Competition Agreement, be prohibited from engaging.

 

Moreover, during the Restricted Period, Professor Shashua must first notify Intel before commencing employment or engagement as a consultant, contractor or partner with any third party (or interviewing for such a position), and must furnish such new employer or service recipient with a copy of the Non-Competition Agreement.

 

Employment Agreement Addendum

 

The following summary description of the Employment Agreement Addendum (as defined below) and all other provisions of the Employment Agreement Addendum discussed herein are qualified by reference to such Employment Agreement Addendum, which has been filed as Exhibit (d)(7) to the Schedule TO filed by the Purchaser with the SEC in connection with the Offer and is incorporated herein by reference. The Employment Agreement Addendum may be examined and copies may be obtained at the places and in the manner set forth under “General Introduction” above. Shareholders and other interested parties should read the Employment Agreement Addendum for a more complete description of the provisions summarized below.

 

Concurrently with the execution of the Purchase Agreement, Professor Shashua entered into an addendum to his employment agreement with the Company’s wholly-owned Israeli subsidiary Mobileye Vision Technologies Ltd. (“MVT”) (the “Employment Agreement Addendum”), which will become effective upon the Company’s becoming an indirect, wholly owned subsidiary of the Purchaser (the “Acquisition”). Pursuant to the Employment Agreement Addendum, rather than receiving the benefit of acceleration of certain outstanding and unvested Company Options and Company RSUs in connection with the transactions contemplated by the Purchase Agreement, Professor Shashua agreed to a revised vesting schedule pursuant to which (a) no such Company Options or Company RSUs will vest prior to the third anniversary of the Acquisition, (b) 50% of such Company Options and Company RSUs will vest upon the third anniversary of the Acquisition and (c) the remaining 50% of such Company Options and Company RSUs will vest on the fourth anniversary of the Acquisition, subject, in each case, to Professor Shashua’s continued employment by the Company or an affiliate of Intel through the applicable vesting date. However, in the event that, following

 

 

 

 

the Acquisition, Professor Shashua’s employment is terminated by the Company for any reason other than cause (as defined in his employment agreement), or Professor Shashua resigns under circumstances constituting a deemed dismissal (as defined in his employment agreement), including, but not limited to, the requirement that Professor Shashua report to anyone other than Intel’s chief executive officer, any unvested Company Options and Company RSUs held by Professor Shashua will immediately vest.

 

Other Agreements

 

For a description of certain other agreements between Intel and the Company entered into prior to the execution of the Purchase Agreement, see the Offer to Purchase, Item 11, “The Purchase Agreement; Other Agreements Confidentiality Agreement” and “Transaction Letter” and the copies of such agreements filed as Exhibits to the Schedule TO by the Purchaser with the SEC.

 

EXPLANATION OF ITEM 2 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (APPROVAL OF ASSET SALE)

 

General Background

 

One of the means of effectuating the Post-Offer Reorganization that the Purchaser may elect to effect after the Offer Closing is the Asset Sale, followed by the Liquidation and the Second Step Distribution. Because the Asset Sale involves the sale of all or substantially all of the assets and business of the Company, under Dutch law the Asset Sale is subject to approval by the general meeting of shareholders of the Company. Shareholders are now being requested to approve the Asset Sale to the Purchaser or an affiliate of the Purchaser on the terms set forth below.

 

Conditions Precedent

 

The consummation of the Asset Sale is subject to the following conditions precedent (the “Asset Sale Conditions Precedent”):

 

·the Acceptance Time having occurred;

 

·the Pre-Wired Asset Sale Ruling having been issued by the ITA;

 

·the Asset Sale Threshold having been achieved, i.e. 67% of the Company’s issued Shares (including Shares tendered during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period, but excluding Shares tendered pursuant to guaranteed delivery procedures that have not yet been delivered in settlement or satisfaction of such guarantee prior to the Expiration Time) having been tendered to the Purchaser in the Offer or otherwise being held by the Purchaser or any of its affiliates;

 

·the Purchase Agreement not having been terminated in accordance with its terms;

 

·the Asset Sale Resolution, the Liquidation Resolution and the Conversion Resolutions having been adopted at the AGM or a Subsequent EGM;

 

·the Asset Sale Agreement having been executed by the Company and the Purchaser; and

 

·all other conditions precedent to the obligation of the Purchaser and the Company to effect the Asset Sale Completion, as set forth in the Asset Sale Agreement, having been satisfied or waived in

 

 

 

 

accordance with the terms of the Asset Sale Agreement. See “Summary of Key Terms of the Asset Sale Agreement Conditions Precedent” below.

 

Unless all of the Asset Sale Conditions Precedent are satisfied, the Asset Sale will not be consummated, even if it is approved by shareholders.

 

Conversely, even if all of the Asset Sale Conditions Precedent are satisfied, Intel and the Purchaser may elect not to effect the Asset Sale and may instead elect to carry out the Post-Offer Reorganization in a different way. For example, if the Purchaser holds 95% or more of the Company’s issued capital, the Purchaser could elect to effect the Post-Offer Reorganization by way of the Compulsory Acquisition rather than by way of the Asset Sale, followed by the Liquidation and Second Step Distribution.

 

Effect of Adoption or Non-Adoption of the Asset Sale Resolution, Liquidation Resolution and Conversion Resolutions

 

If the Asset Sale Resolution, Liquidation Resolution and Conversion Resolutions are not adopted by the requisite majority (see “Vote Required to Approve the Items on the AGM Agenda” above in the introduction to this Shareholders Circular) at the AGM or a Subsequent EGM, then the Purchaser cannot proceed with the Asset Sale, Liquidation and Second Step Distribution after the Offer Closing, without first obtaining shareholder approval for the Asset Sale and Liquidation at a subsequent general meeting of shareholders (which will be controlled by the Purchaser after the Offer Closing) to be held after the Offer Closing.

 

If the Asset Sale Resolution, Liquidation Resolution and Conversion Resolutions are all adopted by the requisite majority at the AGM, the Minimum Percentage of Shares that must be validly tendered to the Purchaser in the Offer as of the Expiration Time, before the Purchaser would be legally obligated to purchase and pay for tendered Shares, will automatically be reduced to 67% if the ITA issues the Pre-Wired Asset Sale Ruling. If the Asset Sale Resolution, Liquidation Resolution and Conversion Resolutions are not all adopted by the requisite majority at the AGM or a Subsequent EGM, then the Minimum Percentage of Shares that must be validly tendered to the Purchaser in the Offer as of the Expiration Time, before the Purchaser would be legally obligated to purchase and pay for tendered Shares, would remain at 95% (or 80% if the ITA issues the Pre-Wired Asset Sale Ruling) rather than potentially being reduced to 67% if the ITA issues the Pre-Wired Asset Sale Ruling. See the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement The Purchase Agreement and the Offer Conditions of the Offer.”

 

If the ITA does not issue the Pre-Wired Asset Sale Ruling, the Minimum Percentage of Shares that must be validly tendered to the Purchaser in the Offer as of the Expiration Time, before the Purchaser would be legally obligated to purchase and pay for Shares tendered to it in the Offer, would remain at 95% (subject to potential unilateral reduction by the Purchaser to 80%), even if the Asset Sale Resolution, the Liquidation Resolution and the Conversion Resolutions are all adopted by the requisite majority at the AGM or a Subsequent EGM. See the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement The Purchase Agreement and the Offer Conditions of the Offer.”

 

General Description of the Proposed Asset Sale, Liquidation and Second Step Distribution

 

If the Purchaser and Intel elect to proceed with the Asset Sale, Liquidation and Second Step Distribution following satisfaction of all of the Asset Sale Conditions Precedent, then the cash consideration paid to the Company in the Asset Sale would be an aggregate amount equal to the Offer Consideration multiplied by the total number of Shares held by non-tendering Company shareholders as of the Asset Sale Completion and, upon consummation of the Asset Sale, (a) the Company will hold only the cash received in the Asset Sale; (b) the Purchaser (or an affiliate of the Purchaser) would (i) own all of the Company’s business operations and (ii) be the principal shareholder in the Company; and (c) the non-tendering shareholders would continue to own Shares representing, in the aggregate, a minority of the Shares then outstanding. As soon as practicable following consummation of the Asset Sale, the Purchaser (or an affiliate of the Purchaser) would then complete the Post-Offer Reorganization by causing the Liquidation to occur with the Purchaser (or an affiliate of the Purchaser) providing an indemnity to the Liquidator in respect of the Liquidation for any deficit in the estate of the Company to enable the Liquidator to make the Second Step Distribution immediately to a depositary on

 

 

 

 

behalf of each non-tendering Company shareholder in an amount equal to the Offer Consideration, without interest and less applicable withholding taxes, for each Share then owned.

 

The Second Step Distribution will, subject to receipt of the Pre-Wired Asset Sale Ruling from the ITA, result in all non-tendering Company shareholders receiving, for each Share then held, cash in an amount equal to the Offer Consideration, in each case without interest and less applicable withholding taxes and further less any bank charges that may be incurred by the shareholders in respect of payments made to them.

 

The Pre-Wired Asset Sale Ruling

 

Under the Purchase Agreement, the Company (which is a tax resident of Israel) has, in consultation with Intel and the Purchaser, filed with the ITA an application for the Pre-Wired Asset Sale Ruling

 

In the absence of the Pre-Wired Asset Sale Ruling the cash consideration received by the Company in the Asset Sale may be subject to Israeli taxation, which would reduce the amount distributable to shareholders of the Company in the Second Step Distribution. The Asset Sale will not be effected if the Pre-Wired Asset Sale Ruling is not obtained.

 

Conditions to the Pre-Wired Asset Sale Ruling

 

The ITA may impose various conditions, restrictions, commitments, undertakings, obligations or remedies on the Company, Intel or the Purchaser, or their affiliates (together “Commitments”), as a condition to issuing the Pre-Wired Asset Sale Ruling. We are generally unable to predict what Commitments could be imposed on the Company, Intel or the Purchaser, or their affiliates, by the ITA as a condition to the ITA’s issuance of the Pre-Wired Asset Sale Ruling.

 

Effect on the Offer Closing of Issuance or Non-Issuance of the Pre-Wired Asset Sale Ruling

 

If the ITA does not issue the Pre-Wired Asset Sale Ruling, the Minimum Percentage of Shares that must be validly tendered to the Purchaser in the Offer as of the Expiration Time, before the Purchaser would be legally obligated to purchase and pay for Shares tendered to it in the Offer, would remain at 95% (subject to potential unilateral reduction by the Purchaser to 80%), even if the Asset Sale Resolution, the Liquidation Resolution and the Conversion Resolutions are all adopted by the requisite majority at the AGM or a Subsequent EGM. See “General Background – Effect of Adoption or Non-Adoption of the Asset Sale Resolution, Liquidation Resolution and the Conversion Resolutions” above, as well as the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement The Purchase Agreement and the Offer Conditions of the Offer.”

 

If the ITA issues the Pre-Wired Asset Sale Ruing, then the Minimum Percentage of Shares that must be validly tendered to the Purchaser in the Offer as of the Expiration Time, before the Purchaser would be legally obligated to purchase and pay for Shares tendered to it in the Offer, would be

 

·reduced to 80% if the Asset Sale Resolution, the Liquidation Resolution and the Conversion Resolutions are not all approved at the AGM or a Subsequent EGM; and

 

·further reduced to 67% if the Asset Sale Resolution, the Liquidation Resolution and the Conversion Resolutions are all approved at the AGM or a Subsequent EGM.

 

See the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and Purchase Agreement – The Purchase Agreement and the Offer – Conditions of the Offer.”

 

Summary of Key Terms of the Asset Sale Agreement

 

The following is a summary of certain key terms of the form of Asset Sale Agreement as agreed between Intel, the Purchaser and the Company. This summary is qualified in its entirety by reference to the form of the Asset Sale Agreement, which is attached as Annex 1 to this Shareholders Circular.

 

 

 

 

Summary of Transactions

 

The Asset Sale Agreement would, if Intel and the Purchaser so elect, be executed by the Purchaser and the Company following the end of the Subsequent Offering Period (as it may be extended by the Minority Exit Offering Period).

 

The Asset Sale Agreement (if executed) will provide that the following transactions will be consummated at the Asset Sale Completion:

 

·The Company will sell and transfer substantially all of its assets and business to the Purchaser and the Purchaser will assume substantially all of the liabilities and obligations of the Company related to the business of the Company.

 

·The Liquidation will become effective in accordance with its terms, immediately following the transfer of the assets, business and liabilities of the Company to the Purchaser. See the discussion below of Item 3 on the AGM Agenda, “Effectiveness of Liquidation.”

 

·The cash purchase price payable by the Purchaser to the Company for the assets and business of the Company (the “Cash Consideration”) will be equal to the Offer Consideration, multiplied by the number of Shares held by shareholders of the Company who, as of the time of the Asset Sale Completion, have not transferred their Shares to the Purchaser, or an affiliate of the Purchaser, in or following the Offer (the “Minority Shareholders”). (Any remaining value of the Company at the time of the Asset Sale Completion will remain outstanding and will be settled on a cashless basis by setoff against the Liquidation distribution to which the Purchaser would otherwise have been entitled.)

 

·The Liquidator will declare and pay the Second Step Distribution, in an amount equal to the Cash Consideration, as an advance liquidation distribution (liquidatievoorschot) payable only to the Minority Shareholders.

 

·The Purchaser will at the Asset Sale Completion deposit the entire amount of the Cash Consideration with the depositary under the Asset Sale Agreement (which is expected to be American Stock Transfer & Trust Company LLC, which is also acting as the depositary with respect to the Offer) (the “Asset Sale Depositary”). The Asset Sale Depositary will hold the Cash Consideration on the date of the Asset Sale Completion (the “Asset Sale Completion Date”), successively on behalf of the parties entitled thereto, as follows:

 

··First, the Asset Sale Depositary will hold the Cash Consideration on behalf of the Purchaser.

 

··Second, immediately after completion on the Asset Sale Completion Date of the legal formalities necessary to transfer the assets and liabilities of the Company to the Purchaser, the Asset Sale Depositary will hold the Cash Consideration on behalf of the Company, in full satisfaction of the obligation of the Purchaser to pay the Cash Consideration to the Company.

 

··Third, immediately following the Liquidator’s declaration on the Asset Sale Completion Date of the Second Step Distribution payable to the Minority Shareholders, the Asset Sale Depositary will hold the Cash Consideration on behalf of the Minority Shareholders, in full satisfaction of the obligation of the Liquidator to pay the Second Step Distribution to the Minority Shareholders.

 

The Cash Consideration payable by the Purchaser to the Company at the Asset Sale Completion will be reduced by the amount of any unrestricted cash then available for distribution by the Company to the Minority Shareholders (“Distributable Cash”). In that case, the Distributable Cash would, as part of the Asset Sale Completion, be paid by the Company to the Asset Sale Depositary, who will hold such amount on behalf of the Minority Shareholders on the Asset Sale Completion Date, as part of the Second Step Distribution.

 

 

 

 

The total Second Step Distribution, including the Distributable Cash, paid to the Asset Sale Depositary on behalf of the Minority Shareholders on the Asset Sale Completion Date will in all cases be equal to the number of Shares held by the Minority Shareholders multiplied by the Offer Consideration, without interest and less applicable withholding tax.

 

Payment of the Second Step Distribution to the Minority Shareholders; Israeli Tax Withholding

 

The Asset Sale Depositary will, as promptly as practicable following the Asset Sale Completion Date, pay the Second Step Distribution to the Minority Shareholders entitled thereto, in accordance with procedures to be announced by Intel and the Purchaser after the Offer Closing.

 

The applicable withholding taxes (including Israeli dividend withholding taxes) and other taxes, if any, imposed on Shareholders who do not tender their Shares pursuant to the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period) may be different from, and greater than, the taxes imposed upon such Shareholders had they tendered their Shares pursuant to the Offer (including during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period).

 

The Asset Sale Agreement provides that the Purchaser and the Asset Sale Depositary shall be entitled to deduct and withhold from any payment due by them under or pursuant to the Asset Sale Agreement, such amounts as the Purchaser shall determine are required to be deducted or withheld with respect to such payment, pursuant to Israeli or other applicable tax laws.

 

The Israeli Equity Tax Ruling will be applicable to payments due to the Minority Shareholders by the Asset Sale Depositary, and by the Purchaser or the Company to the Asset Sale Depositary, pursuant to the Asset Sale Agreement, provided that the ITA has issued the Pre-Wired Asset Sale Ruling. See the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement – The Purchase Agreement and the Offer – Israeli Withholding Tax.” The Asset Sale will not be effected if the Pre-Wired Asset Sale Ruling is not obtained. See “The Pre-Wired Asset Sale Ruling” above.

 

Conditions Precedent

 

The Asset Sale Agreement (if executed) will provide that the obligation of each of the Purchaser and the Company to effect the Asset Sale Completion is subject to the satisfaction or waiver of the following conditions precedent (the “Additional Asset Sale Conditions Precedent”), in addition to the other Asset Sale Conditions Precedent listed above under “General Background Conditions Precedent”:

 

·No Legal Restraint shall be in effect that prohibits, renders illegal or enjoins the Asset Sale Completion.

 

·Any Israeli tax rulings other than the Pre-Wired Asset Sale Ruling that may be required in connection with the transactions contemplated by the Asset Sale Agreement shall have been obtained, and such rulings, together with the Pre-Wired Asset Sale Ruling, shall remain in full force and effect as of the Asset Sale Completion Date.

 

Undertakings by the Purchaser

 

The Purchaser will agree in the Asset Sale Agreement (if executed) that it will do any such things as are reasonably necessary to procure that neither the Company, the Liquidator (or any other person subsequently appointed as a liquidator of the Company) or any other person will have any grounds to demand any refund or repayment of any part of the Second Step Distribution received by the Minority Shareholders, or by the Asset Sale Depositary on behalf of the Minority Shareholders, on any grounds whatsoever.

 

The Asset Sale Agreement (if executed) will further provide that all costs of the Liquidation, and all debts, liabilities and claims of or against the Company, payable by the Company in connection with the Liquidation, will be borne solely by the Purchaser and not by the Minority Shareholders.

 

 

 

 

Assignment

 

The Purchaser may assign any or all of its rights and obligations under the Asset Sale Agreement to one or more affiliates of the Purchaser (including, following the Asset Sale Completion, the Company and its designated subsidiaries) provided that the Purchaser shall continue to be jointly and severally liable with such assignee or assignees for the performance of the Purchaser’s obligations under the Asset Sale Agreement.

 

Role of Independent Directors

 

The consent of the Independent Directors, who will remain in office until the Asset Sale Completion (see the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement The Purchase Agreement and the Offer Composition of the Board of Directors after the Offer Closing”), will be required for (i) any amendment or modification of the Asset Sale Agreement, (ii) any waiver by the Company of any of its rights under the Asset Sale Agreement, (iii) any waiver by the Company of any of the Additional Asset Sale Conditions Precedent or (iv) any termination of the Asset Sale Agreement.

 

Governing Law; Jurisdiction

 

The Asset Sale Agreement (if executed) will be governed by and construed in accordance with the laws of The Netherlands. All disputes arising under the Asset Sale Agreement will be submitted for resolution to the competent court in Amsterdam, The Netherlands.

 

EXPLANATION OF ITEM 3 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (APPROVAL OF THE LIQUIDATION RESOLUTION)

 

Background

 

In order to effect the Asset Sale, Liquidation and Second Step Distribution, the Liquidation must occur immediately following the Asset Sale Completion. Under Dutch law the Liquidation is subject to approval by the general meeting of shareholders of the Company. Shareholders are now being requested to approve the Liquidation and, in connection therewith to also approve the following matters as part of the Liquidation Resolution:

 

·the appointment of Stichting Vereffening Mobileye as the Liquidator. See “Appointment of Liquidator” below; and

 

·the compensation of the Liquidator. See “Compensation of the Liquidator” below.

 

Effect of Adoption or Non-Adoption of the Liquidation Resolution

 

See the discussion above of Item 2 on the AGM Agenda, “General Background Effect of Adoption or Non-Adoption of the Asset Sale Resolution, Liquidation Resolution and Conversion Resolutions.”

 

Effectiveness of Liquidation

 

If the Liquidation Resolution is adopted at the AGM, the Liquidation will automatically become effective, and the Company will be automatically liquidated (ontbonden) under Dutch law, without the need for any further action to be taken on the part of the Company, the Board of Directors or the general meeting of shareholders of the Company, upon the occurrence of all of the following conditions precedent (the “Liquidation Conditions Precedent”):

 

 

 

 

·the Acceptance Time having occurred;

 

·the Asset Sale Threshold having been achieved; and

 

·the Asset Sale Completion having occurred.

 

In practice, this means that, if the Asset Sale Completion occurs, the Company will be automatically liquidated on the Asset Sale Completion Date, immediately following the completion of those legal formalities which are required in order to transfer the assets and liabilities of the Company to the Purchaser. See the discussion above of Item 2 on the AGM Agenda, “Summary of Key Terms of the Asset Sale Agreement Summary of Transactions.”

 

General Description of Liquidation Procedure under Dutch law

 

Introduction

 

The Company would not under Dutch law cease to exist as of the time when the Liquidation becomes effective, but rather would continue in existence thereafter for the sole purpose of effecting the winding up of all of the assets and liabilities of the Company, under the management and supervision of the Liquidator.

 

Upon the Liquidation becoming effective (see “Effectiveness of Liquidation” above), the Board of Directors of the Company would cease to exist and it would be the Liquidator rather than the Board of Directors who would have the responsibility for winding up the assets and liabilities of the Company. The Liquidator has the obligation under Dutch law to cause the settlement as soon as practicable, out of the assets of the Company, of all of the liabilities of the Company, and thereafter to ensure the distribution as soon as practicable to the Company’s shareholders of all of the assets of the Company which are available for distribution to shareholders after satisfaction of the Company’s liabilities.

 

Advance Liquidation Distribution

 

The Liquidator may during the winding-up of the Company make one or more advance liquidation distributions to shareholders. The Liquidator is not expected to make any advance liquidation distribution to shareholders of the Company in the Liquidation other than the Second Step Distribution, in an amount equal to the Offer Consideration multiplied by the number of Shares held by the Minority Shareholders (without interest and less applicable withholding tax), which will be paid by the Liquidator to the Asset Sale Depositary on behalf of the Minority Shareholders on the Asset Sale Completion Date. See the discussion above of Item 2 on the AGM Agenda, “Summary of Key Terms of the Asset Sale Agreement Summary of Transactions.”

 

The Liquidator may generally not make any advance liquidation distributions to shareholders after the filing by the Liquidator with the Trade Register of the Chamber of Commerce of The Netherlands (the “Dutch Trade Register”) of the final accounting (rekening en verantwoording) and plan of distribution (plan van verdeling) (together the “Plan of Distribution”) in relation to the Liquidation. The Asset Sale Agreement will (if executed) provide that the Liquidator must pay the Second Step Distribution to the Asset Sale Depositary on behalf of the Minority Shareholders before the Liquidator files the Plan of Distribution with the Dutch Trade Register.

 

Shareholders are normally obligated under Dutch law to repay to the Liquidator on behalf of the Company their pro rata share of any advance liquidation distribution received by them, to the extent necessary to satisfy liabilities of the Company that have to be paid by the Liquidator as part of the winding up of the assets and liabilities of the Company during the Liquidation. In the present case the Purchaser will undertake in the Asset Sale Agreement that the Purchaser will satisfy all debts and liabilities of the Company in connection with the Liquidation, and that the Purchaser will do any such things as are reasonably necessary to ensure that neither the Liquidator nor any other person will have any grounds to demand any refund or repayment by the Minority Shareholders, on any grounds whatsoever, of any part of the Second Step Distribution received by them or by the Asset Sale Depositary on their behalf. See the discussion above of Item 2 on the AGM Agenda, “Summary of Key Terms of the Asset Sale Agreement Undertakings by the Purchaser.”

 

 

 

 

Opposition to the Plan of Distribution by Creditors

 

After the liabilities of the Company have been settled by the Liquidator out of the assets of the Company, the Liquidator must file the Plan of Distribution, setting out how the remaining assets of the Company (if any) will be distributed, with the Dutch Trade Register, and place an advertisement in a Dutch newspaper (the “Publication Notice”) stating that the Plan of Distribution has been filed with the Dutch Trade Register and that the Plan of Distribution is available for inspection at the offices of the Company. The Company must then, following the Publication Notice, make the Plan of Distribution available for inspection by all parties at the Company’s headquarters in Israel, for a period of two months following the date when the Publication Notice is first published in a Dutch daily newspaper as described above (the “Publication Date”).

 

During this period of two months following the Publication Date (the “Creditors’ Opposition Period”), any creditor of the Company, or other interested party (belanghebbende) (a “Creditor”), can file an action in the Dutch courts opposing the implementation of the Plan of Distribution.

 

Since the Purchaser will at the Asset Sale Completion acquire all of the assets and business of the Company, and assume all of the liabilities and obligations of the Company relating to the business of the Company (see the discussion above of Item 2 on the AGM Agenda, “Summary of Key Terms of the Asset Sale Agreement Summary of Transactions”), it is not anticipated that any Creditor would during the Creditors’ Opposition Period initiate any litigation in the Dutch courts opposing the implementation of the Plan of Distribution.

 

If the Creditors’ Opposition Period expires without any Creditor opposing the implementation of the Plan of Distribution, the Liquidator can then make the final liquidation distribution to shareholders as provided in the Plan of Distribution. If a Creditors’ suit opposing the implementation of the Plan of Distribution is initiated in the Dutch courts during the Creditors’ Opposition Period, the Liquidation could not be completed, and no distribution could be made to shareholders, until that Creditors’ suit is finally resolved.

 

In the present case, it is not anticipated that any distribution will be made to shareholders of the Company in addition to the Second Step Distribution paid on behalf of the Liquidator to the Asset Sale Depositary on the Asset Sale Completion Date. The Plan of Distribution of the Company is thus expected to provide that the Second Step Distribution will constitute full and final payment to the Minority Shareholders of all amounts due to them in the Liquidation of the Company and that no shareholders of the Company will be entitled to receive any other distributions as a result of the Liquidation.

 

End of the Company’s Corporate Existence; Re-Opening of the Liquidation Procedure

 

The Company’s corporate existence will come to an end, and the Company will cease to have any further legal existence under Dutch law, after the end of the Creditors’ Opposition Period (or, if during the Creditors’ Opposition Period any Creditors’ suits are initiated opposing the implementation of the Plan of Distribution, after the final resolution of such Creditors’ suits by the Dutch courts), at such time as there are no further assets available for distribution by the Liquidator to the shareholders of the Company.

 

The Liquidator must file notice of the Company’s ceasing to exist with the Dutch Trade Register, after which the Company will be stricken from the Dutch Trade Register and will no longer be recognized as an entity having legal existence under Dutch law.

 

The Liquidation can be reopened even after the Company has been stricken from the Dutch Trade Register if assets or liabilities of the Company are subsequently discovered that were not properly dealt with during the Liquidation. In that case any interested party can petition the Dutch courts to reopen the Liquidation and appoint a liquidator to handle the further winding-up of the relevant newly discovered assets and liabilities. The court-appointed liquidator could in that case demand repayment by the Company’s shareholders of their pro rata share of any distributions received by them in the Liquidation, including the Second Step Distribution, to the extent necessary to satisfy any relevant newly discovered creditors’ claims.

 

Since the Purchaser will at the Asset Sale Completion acquire all of the assets and business of the Company, and assume all of the obligations and liabilities of the Company associated with the business of the Company, it is not presently anticipated that the Liquidation could be reopened or that Minority Shareholders would have

 

 

 

 

to repay any part of the Second Step Distribution paid to the Asset Sale Depositary on their behalf at the Asset Sale Completion. Moreover, the Purchaser will undertake in the Asset Sale Agreement that it will satisfy all debts and liabilities of the Company in connection with the Liquidation and that the Purchaser will do any such things as are reasonably necessary to ensure that no person will have any grounds to demand any refund or repayment by the Minority Shareholders, on any grounds whatsoever, of any part of the Second Step Distribution received by them. See the discussion above of Item 2 on the AGM Agenda, “Summary of Key Terms of the Asset Sale Agreement Undertakings by the Purchaser.”

 

Books and Records Custodian

 

Under Dutch law a custodian of the books and records (the “Books and Records Custodian”) is required to be appointed who will retain custody of the books and records of the Company for a period of seven years following the completion of the Liquidation. The Liquidator will appoint the Books and Records Custodian, prior to the time when the Liquidation is finally completed and the Company’s corporate existence comes to an end.

 

The Books and Records Custodian is required to maintain custody of all books and records of the Company for a period of 7 years following the date when the Company is stricken from the Dutch Trade Register (the “Custody Period”).

 

The Books and Records Custodian is required to allow inspection of the books and records of the Company, during the Custody Period, by any person who is authorized to inspect such books and records by an order of the Dutch courts.

 

After the end of the Custody Period the Books and Records Custodian will no longer be obligated to retain custody of the Company’s books and records, and may destroy such books and records if it chooses to do so.

 

Appointment of Liquidator

 

As part of the Liquidation Resolution, shareholders are requested to approve the appointment of Stichting Vereffening Mobileye as the Liquidator of the Company.

 

Information Concerning the Liquidator

 

The Liquidator was incorporated by an affiliate of Intel as a foundation (stichting) under Dutch law on May 9, 2017. The articles of association of the Liquidator (the “Liquidator Articles”) provide that such affiliate of Intel will have the sole right to appoint, remove and suspend the directors of the Liquidator. The Liquidator Articles further provide that the objects of the Liquidator are to carry out the Liquidator’s duties as liquidator of the Company. See “Duties and Responsibilities of the Liquidator” below.

 

All of the initial directors of the Liquidator are legal entities associated with Vistra B.V., a Dutch trust company (“Vistra”). All of the future directors of the Liquidator are also expected to be legal entities or individuals associated with Vistra.

 

The Liquidator Articles provide that the following actions will be subject to the prior approval of the Independent Directors, for as long as the Independent Directors remain in office after the Offer Closing (see the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement – The Purchase Agreement and the Offer – Composition of the Board of Directors after the Offer Closing”):

 

·appointment of directors of the Liquidator;

 

·amendment of the Liquidator Articles; and

 

·dissolution (ontbinding) of the Liquidator.

 

 

 

 

Duties and Responsibilities of the Liquidator

 

The Liquidator will have primary responsibility for the management and supervision of the winding up of the assets and liabilities of the Company during the Company’s Liquidation. See “General Description of Liquidation Procedure under Dutch Law Introduction” above.

 

The Liquidator will during the Liquidation be subject to removal or suspension at any time by the general meeting of shareholders of the Company (which will be controlled by the Purchaser after the Offer Closing). The general meeting of shareholders of the Company (which will be controlled by the Purchaser after the Offer Closing) may also appoint other persons as liquidators in addition to the Liquidator, or as a replacement for the Liquidator after the Liquidator’s resignation or removal. The Dutch courts can also remove a liquidator at any time and appoint one or more new liquidators to serve in the place of the liquidator that has been removed. In addition, the Dutch courts have the right, following the filing of a petition by any shareholder or other interested party, to appoint one or more persons to serve as liquidators of the Company at any time when there are no persons then serving as liquidators of the Company.

 

A court-appointed liquidator is obligated to comply promptly with any orders issued by the court that has appointed him as liquidator. A court-appointed liquidator is also obligated to file a final accounting, describing the manner in which he discharged his duties as liquidator, with the court which appointed him as liquidator, not later than one month following the completion of the Liquidation.

 

If there is more than one liquidator, all decisions by the liquidators must be taken unanimously. In the event of any disagreement among the liquidators, any liquidator may petition the Dutch courts to decide how the liquidators should proceed on the matter as to which there is a disagreement among them.

 

Compensation of the Liquidator

 

As part of the Liquidation Resolution, shareholders are requested to approve the compensation of the Liquidator.

 

It is proposed that the Liquidator will be entitled to compensation by the Company in a total amount of up to EUR 25,000, payable in exchange for services provided by the Liquidator.

 

The compensation of the Liquidator will be subject to modification from time to time by the general meeting of shareholders of the Company (which will be controlled by the Purchaser after the Offer Closing). In addition, the general meeting of shareholders of the Company (which will be controlled by the Purchaser after the Offer Closing) would in its sole discretion determine the compensation of any additional liquidator of the Company appointed by the general meeting of shareholders of the Company after the Liquidation becomes effective. See “Appointment of Liquidator Duties and Responsibilities of the Liquidator” above.

 

Any liquidator that is appointed by the Dutch courts (see “Appointment of Liquidator Duties and Responsibilities of the Liquidator” above) would be entitled to such compensation from the Company for serving as liquidator as the court may determine.

 

EXPLANATION OF ITEM 5 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (CONVERSION DEED OF AMENDMENT OF THE ARTICLES OF ASSOCIATION)

 

The Purchaser may after the Offer Closing elect to effect the B.V. Conversion, resulting in the conversion of the Company from an N.V. into a B.V. under Dutch law.

 

The B.V. Conversion will become effective upon the first to occur of (i) the execution of the Conversion Deed of Amendment (see the discussion below of Item 5 on the AGM Agenda) or (ii) the execution of the Post-Delisting Deed of Amendment (see the discussion below of Item 6 on the AGM Agenda).

 

Shareholders are now being requested at the AGM to approve the B.V. Conversion.

 

 

 

 

The B.V. Conversion will result in the Company ceasing to be an N.V., and becoming a B.V., under Dutch law. In addition, effective upon the B.V. Conversion, the Articles would be amended as set out below under the discussion of Items 5 and 6 on the AGM Agenda.

 

See the discussion above of Item 2 on the AGM Agenda, “General Background — Effect of Adoption or Non-Adoption of the Asset Sale Resolution, Liquidation Resolution and Conversion Resolutions,” for a description of certain consequences, in relation to the Offer, of the failure to adopt the B.V. Conversion Resolution at the AGM or a Subsequent EGM.

 

EXPLANATION OF ITEM 5 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (CONVERSION DEED OF AMENDMENT OF THE ARTICLES OF ASSOCIATION)

 

Background

 

In connection with the B.V. Conversion (see the discussion above of Item 4 on the AGM Agenda), shareholders are being requested to approve the proposed amendment of the Articles pursuant to the draft Conversion Deed of Amendment, a copy of which is attached to this Shareholders Circular as Annex 2.

 

Conditions Precedent

 

The amendment of the Articles pursuant to the Conversion Deed of Amendment is subject to the Conversion Deed of Amendment Conditions Precedent, as follows:

 

·The Offer Closing having occurred.

 

·The Purchase Agreement not having been terminated in accordance with its terms.

 

·The B.V. Conversion Resolution having been adopted at the AGM or a Subsequent EGM.

 

The Conversion Deed of Amendment may not be executed until the Conversion Deed of Amendment Conditions Precedent have been satisfied. The satisfaction of the Conversion Deed of Amendment Conditions Precedent will be conclusively evidenced by the delivery to the Dutch notary executing the Conversion Deed of Amendment of a certificate, signed by an executive director of the Company, attesting to the fact that the Conversion Deed of Amendment Conditions Precedent have been satisfied.

 

Even if the Conversion Deed of Amendment Conditions Precedent are satisfied, Intel and the Purchaser may in their sole discretion elect after the Offer Closing not to cause the Conversion Deed of Amendment to be executed. Intel and the Purchaser could, for example, elect to have the Post-Delisting Deed of Amendment executed immediately following the delisting of the Company’s Shares from trading on the NYSE, without having the Conversion Deed of Amendment executed first. See the discussion below of Item 6 on the AGM Agenda. They could also in their sole discretion elect not to cause the Articles to be amended at all after the Offer Closing, or to cause the Articles to be amended in a manner other than that specified in the Post-Conversion Deed of Amendment or the Post-Delisting Deed of Amendment.

 

Effect of Adoption or Non-Adoption of the Conversion Amendment Resolution

 

If the B.V. Conversion Resolution and the Conversion Amendment Resolution are not both adopted by the requisite majority (see “Vote Required to Approve the Items on the AGM Agenda” above in the introduction to this Shareholders Circular) at the AGM or a Subsequent EGM, then the Purchaser cannot cause the execution of the Conversion Deed of Amendment after the Offer Closing, without first obtaining shareholder approval of the B.V. Conversion and the Conversion Deed of Amendment at a subsequent general meeting of shareholders of the Company (which will be controlled by the Purchaser after the Offer Closing) to be held after the Offer Closing.

 

 

 

 

See also the discussion above of Item 2 on the AGM Agenda, “General Background Effect of Adoption or Non-Adoption of the Asset Sale Resolution, Liquidation Resolution and Conversion Resolutions” for a description of certain other consequences, in relation to the Offer, of the failure to adopt the Conversion Amendment Resolution at the AGM or a Subsequent EGM.

 

Proposed Amendments to the Articles

 

The description of the Conversion Deed of Amendment below is not complete and is qualified in its entirety by the text of the proposed Conversion Deed of Amendment annexed hereto as Annex 2.

 

The text of the proposed Conversion Deed of Amendment which is annexed to this Shareholders Circular as Annex 2 shows by way of striking through (for deletions) and underscoring (for additions) the changes proposed to be made by the Conversion Deed of Amendment to the text of the Articles as they are currently in effect.

 

Requirement of a Notarial Deed for Transfer of Shares

 

The most important change in the Articles that would result from the execution of the Conversion Deed of Amendment is that, pursuant to mandatory provisions of Dutch law that apply to a B.V. but not to an N.V., a notarial deed executed by a Dutch notary (a “Dutch Notarial Deed”) will be required for all transfers of registered ownership of shares in the capital of the Company after the Conversion Deed of Amendment has become effective.

 

When Is a Dutch Notarial Deed Required?

 

Shares Held through DTC. Shareholders who hold their Shares in book-entry form through the facilities of Depository Trust Company (“DTC”) will after execution of the Conversion Deed of Amendment continue to be able to transfer ownership of their Shares, in accordance with the applicable procedures of DTC for the transfer of book-entry interests in Shares held through DTC, without execution of a Dutch Notarial Deed, for as long as the Shares are listed for trading on the NYSE. After delisting of the Shares from the NYSE, DTC will most likely require the transfer into registered form of all Shares held through DTC. This transfer would require the execution of a Dutch Notarial Deed between the relevant beneficial owner of Shares held in book-entry form through the facilities of DTC, as transferee, and the nominee of DTC (typically Cede & Co.) in whose name such Shares are registered in the Company’s shareholders register, as transferor.

 

Shareholders who hold their Shares in book-entry form through the facilities of DTC, and who do not plan to tender their Shares to the Purchaser by the Expiration Time, are advised to transfer their Shares into registered form prior to the Offer Closing, in order to avoid the incurrence of expenses for notarial fees, and the compliance with other administrative formalities under Dutch law, which are described below at “Requirements for Execution of a Dutch Notarial Deed for the Transfer of Shares.”

 

Shares Held in Registered Form. Shares that are as of the execution of the Conversion Deed of Amendment held in registered form in the shareholders register of the Company can only be transferred by way of execution of a Dutch Notarial Deed after execution of the Conversion Deed of Amendment.

 

If the Conversion Deed of Amendment is executed prior to or during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period (see the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement – The Purchase Agreement and the Offer – The Subsequent Offering Period and the Minority Exit Offering Period”), then certain tenders of Shares to the Purchaser during the Subsequent Offering Period, as it may be extended by the Minority Exit Offering Period, may be required to be effected by way of a Dutch Notarial Deed, as more fully described at “Requirements for Execution of a Dutch Notarial Deed for the Transfer of Shares” below.

 

 

 

 

Requirements for Execution of a Dutch Notarial Deed for the Transfer of Shares

 

In order to transfer shares in the Company by way of execution of a Dutch Notarial Deed, the following mandatory formalities of Dutch law must be complied with:

 

(1)The transferor and the transferee of shares must, if they are individuals, provide information concerning their nationality, place and date of birth, marital status and residence address, to the Dutch notary before whom the Dutch Notarial Deed is executed.

 

(2)The transferor or transferee of shares must, if it is a legal entity, partnership or trust, provide the Dutch notary before whom the Dutch Notarial Deed is executed with information concerning its place of organization and other relevant details relating to it, including in some cases the identity of its ultimate beneficial owners. Such a legal entity, partnership or trust must also provide such Dutch notary with the personal details described at (1) above in respect of the individual who grants the power of attorney to the Dutch notary to execute the Dutch Notarial Deed on behalf of such legal entity, partnership or trust or who signs the Dutch Notarial Deed in person in the presence of the Dutch notary on behalf of the relevant legal entity, partnership or trust. See (3) below.

 

(3)Each of the parties to the Dutch Notarial Deed (i.e. the transferor and transferee of shares) must either provide the Dutch notary before whom the Dutch Notarial Deed is executed with an original power of attorney, in a form prescribed by such Dutch notary, to execute the Dutch Notarial Deed, or must appear in person in The Netherlands to sign the Dutch Notarial Deed in the presence of the Dutch notary before whom the Dutch Notarial Deed is executed. Powers of attorney must be legalized by a local notary in the country where the power of attorney is executed, and the signature of such local notary must be apostilled, or legalized by the diplomatic authorities of The Netherlands in the country where the power of attorney is executed.

 

(4)Legal entities, partnerships and trusts must provide the Dutch notary before whom the Dutch Notarial Deed is executed, with proof of the legal authority of the person who executes the power of attorney to such Dutch notary as described at (3) above on behalf of the relevant legal entity, partnership or trust, or who will appear in person on behalf of such legal entity, partnership or trust before such Dutch notary to sign the Dutch Notarial Deed. As evidence of such individual’s authority to represent the relevant legal entity, partnership or trust, the Dutch notary may require delivery of a formal legal opinion by a reputable attorney admitted to practice in the jurisdiction of organization of the relevant legal entity, partnership or trust, attesting to such authority.

 

(5)The Dutch notary before whom the Dutch Notarial Deed is executed must be provided with a copy of the passport, or other acceptable identity document under Dutch law, of the individual who executes the relevant Dutch Notarial Deed in person before the notary, or who has granted a power of attorney to the notary for the execution of the Dutch Notarial Deed.

 

(6)In order for a transfer of shares to be valid insofar as the Company is concerned, the Company must be a party to the Dutch Notarial Deed pursuant to which shares are transferred, solely for the purpose of acknowledging the transfer of shares. Alternatively, in order to ensure that a transfer of shares is valid insofar as the Company is concerned, a copy of the Dutch Notarial Deed of transfer must be served by a bailiff (gerechtsdeurwaarder) of the Dutch courts on the Company at its headquarters in Israel.

 

(7)The parties to the Dutch Notarial Deed must pay fees to the Dutch notary before whom the Dutch Notarial Deed is executed, based on the regular hourly rates for partners and associates of the Dutch law firm with which such notary is associated. Fees for execution of a Dutch Notarial Deed of transfer of shares can be expected to be between EUR 2,000 and EUR 5,000 for each such Dutch Notarial Deed executed by a Dutch notary.

 

The transferor and transferee of shares will be solely responsible for paying all of the Dutch notary’s fees in connection with any transfer of shares by way of execution of a Dutch Notarial Deed. The Company will not advance to shareholders, or reimburse shareholders for, any part of such fees. Intel and the Purchaser have advised the Company that Intel and the Purchaser will cause the Company, in order to ensure the validity of

 

 

 

 

all Dutch Notarial Deeds executed before a Dutch notary (see paragraph (6) above), to become a party to all Dutch Notarial Deeds of transfer of shares executed before a Dutch notary after the Conversion Deed of Amendment becomes effective.

 

Other Amendments to the Articles

 

The Conversion Deed of Amendment will effect the following additional amendments to the Articles:

 

(1)The name of the Company will be changed from “Mobileye N.V.” to “Mobileye B.V.”

 

(2)The Company will no longer be permitted to issue fractional shares, as under Dutch law B.V.s are not allowed to have fractional shares.

 

(3)The general meeting of shareholders of the Company will be authorized to adopt resolutions for the issuance of shares, or for the grant of the right to acquire shares, and to exclude pre-emptive rights in connection therewith, without the prior approval of the Board of Directors of the Company, as is required by the current Articles.

 

(4)The Articles will provide after execution of the Conversion Deed of Amendment that payment of the entire consideration for shares issued by the Company may be postponed until such time as the Company demands payment thereof. The Articles currently provide, as required by mandatory provisions of Dutch law relating to N.V.s, that at least 25% of the nominal value of shares, and 100% of the consideration for the issuance of shares in excess of the nominal value thereof, must be paid to the Company at the time shares are issued.

 

(5)The requirement that a Dutch accountant issue an opinion relating to the valuation of property (other than cash) in consideration for the contribution of which shares are issued, will be removed from the Articles, as Dutch law only imposes such requirement on an N.V. and not on a B.V.

 

(6)The Articles will provide that the Board of Directors of the Company may adopt a resolution for the repurchase of the Company’s shares, without the need for any prior approval of the repurchase by the general meeting of shareholders, as is required by Dutch law for an N.V. See also the discussion below of Item 14 on the AGM Agenda.

 

(7)Certain limitations on the ability of the Company to repurchase its own shares, which are applicable under Dutch law to an N.V. but not to a B.V., will be removed from the Articles. Instead, the Articles will provide, as required for a B.V., that a repurchase of shares will not be permitted if the Board of Directors knows or should reasonably foresee that following such repurchase the Company will not be able to continue paying its debts as and when they fall due.

 

(8)Certain provisions of the Articles which prohibit the Company from providing financial assistance, including the making of loans and the granting of security, to third parties for the acquisition of the Company’s shares, will be removed from the Articles. Under Dutch law this prohibition on providing financial assistance for the acquisition of the Company’s own shares applies only to an N.V. but not to a B.V.

 

(9)The Conversion Deed of Amendment will provide that, after the repurchase by the Company of its own shares, at least one share with voting rights must be held by a person other than the Company or one of its subsidiaries. This provision allows the Company, as is permitted for B.V.s, to repurchase all of its outstanding shares other than one share which must remain outstanding and held by a third person. The Company is currently prohibited by the Articles from repurchasing more than 50% of its issued capital, which is the maximum percentage of the Company’s own shares that may be held by a publicly traded N.V. under Dutch law.

 

(10)The requirement that the general meeting of shareholders may only resolve upon a capital reduction with the prior approval of the Board of Directors of the Company will be removed from the Articles.

 

 

 

 

(11)Under the current Articles the Company can only effect a reduction of capital by way of cancellation of treasury shares. After execution of the Conversion Deed of Amendment the Company will also be able to effect a reduction of capital by repayment of amounts previously paid by shareholders for their shares.

 

(12)Following the execution of the Conversion Deed of Amendment, the Company’s shares could only be validly transferred by way of a Dutch Notarial Deed of transfer. See “Requirement of a Notarial Deed for Transfer of Shares” above. Until the execution of the Post-Delisting Deed of Amendment (see the discussion below of Item 6 on the AGM Agenda), no other restriction would apply to the transfer of the Company’s shares.

 

(13)The Company will continue to have a one-tier Board of Directors, consisting of executive and non-executive directors, following execution of the Conversion Deed of Amendment. See the discussion below of Item 11 on the AGM Agenda, “Background.” However, the total number of executive and non-executive directors will be laid down in, and may be increased or decreased pursuant to, a resolution of the general meeting of shareholders of the Company, rather than by a resolution of the Board of Directors, as provided in the current Articles.

 

(14)The provisions of the Articles relating to dividends and other distributions will be amended to conform to mandatory provisions of Dutch law relating to distributions to shareholders of a B.V. Specifically, the Articles will after execution of the Conversion Deed of Amendment provide that distributions (including interim distributions) can at all times be declared by a resolution of the general meeting of shareholders, subject to approval by the Board of Directors of the Company. The Board of Directors may not withhold its approval of a proposed distribution unless in the Board’s opinion the payment of the distribution would result in the Company being unable to pay its debts as and when they fall due. Currently, the Articles allow dividends and other distributions to be declared and paid only if the Company’s shareholders equity after payment of the dividend or other distribution will be greater than the aggregate nominal value of all of the Company’s issued and outstanding shares. This restriction will no longer apply after execution of the Conversion Deed of Amendment.

 

(15)The minimum percentage of the company’s issued capital required to allow one or more persons to request items to be placed on the agenda for a general meeting of shareholders will be decreased to 1%. Under Dutch law, persons holding shares in an N.V. representing at least 3% of the company’s issued capital may request that items be placed on the agenda for the general meeting, as also reflected in the Company’s current Articles, whereas in respect of a B.V. persons holding shares in the B.V. representing at least 1% of the company’s issued capital may request that items be placed on the agenda for the general meeting.

 

(16)The provisions in the current Articles providing that a shareholder will generally only be permitted to attend and vote at a shareholders meeting if he was a shareholder of record on the 28th day preceding the date of the shareholders meeting will be removed from the Articles, as under Dutch law such provisions only apply to an N.V. and not to a B.V. Following execution of the Conversion Deed of Amendment, only persons who are shareholders of the Company at the time a shareholders meeting is actually held can attend and vote at the meeting.

 

(17)The requirement that the general meeting of shareholders may not adopt resolutions relating to the amendment of the Articles of Association of the Company, the statutory merger or the statutory demerger of the Company, or the liquidation or dissolution of the Company, except with the prior approval of the Board of Directors of the Company, will be removed from the Articles after execution of the Conversion Deed of Amendment.

 

 

 

 

EXPLANATION OF ITEM 6 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (POST-DELISTING DEED OF AMENDMENT OF THE ARTICLES OF ASSOCIATION)

 

Background

 

The Purchaser has announced that it intends to delist the Company’s Shares from trading on the NYSE as soon as possible after the Offer Closing. Once the Company’s Shares have been delisted from trading on the NYSE, the Purchaser and Intel may elect to cause the Post-Delisting Deed of Amendment, which will further amend the Company’s Articles, to be executed.

 

Shareholders are now being requested to approve the proposed amendment of the Articles pursuant to the draft Post-Delisting Deed of Amendment, a copy of which is annexed to this Shareholders Circular as Annex 3.

 

Conditions Precedent

 

The amendment of the Articles pursuant to the Post-Delisting Deed of Amendment is subject to the Post-Delisting Deed of Amendment Conditions Precedent, as follows:

 

·Either (i) the Conversion Deed of Amendment having been executed or (ii) (A) the Offer Closing having occurred, (B) the Purchase Agreement not having been terminated in accordance with its terms and (C) the B.V. Conversion Resolution having been adopted at the AGM or a Subsequent EGM.

 

·The Shares having been delisted from trading on the NYSE (the “Delisting”).

 

The Post-Delisting Deed of Amendment may not be executed until after the Post-Delisting Deed of Amendment Conditions Precedent have been satisfied. The satisfaction of the Post-Delisting Deed of Amendment Conditions Precedent (other than the prior execution of the Conversion Deed of Amendment) will be conclusively evidenced by the delivery to the Dutch notary executing the Post-Delisting Deed of Amendment of a certificate, signed by an executive director of the Company, attesting to the fact that the Post-Delisting Deed of Amendment Conditions Precedent have been satisfied.

 

Even if the Post-Delisting Deed of Amendment Conditions Precedent are satisfied, Intel and the Purchaser may elect in their sole discretion not to cause the Post-Delisting Deed of Amendment to be executed. They could, for example, after the Delisting elect not to cause the Articles to be amended at all or to cause the Articles to be amended in a manner other than that specified in the Post-Delisting Deed of Amendment.

 

Effect of Adoption or Non-Adoption of the Delisting Amendment Resolution

 

If the B.V. Conversion Resolution and the Delisting Amendment Resolution are not both adopted by the requisite majority (see “Vote Required to Approve the Items on the AGM Agenda” above in the introduction to this Shareholders Circular) at the AGM or a Subsequent EGM, then the Purchaser cannot cause the execution of the Post-Delisting Deed of Amendment after the Delisting, without first obtaining shareholder approval of the B.V. Conversion and the Post-Delisting Deed of Amendment at a subsequent general meeting of shareholders (which will be controlled by the Purchaser after the Offer Closing) to be held after the Offer Closing.

 

See also the discussion above of Item 2 on the AGM Agenda, “General Background Effect of Adoption or Non-Adoption of the Asset Sale Resolution, Liquidation Resolution and Conversion Resolutions” for a description of certain other consequences, in relation to the Offer, of the failure to adopt the Delisting Amendment Resolution at the AGM or a Subsequent EGM.

 

 

 

 

Proposed Amendments to the Articles

 

The description of the Post-Delisting Deed of Amendment below is not complete and is qualified in its entirety by the text of the proposed Post-Delisting Deed of Amendment annexed hereto as Annex 3.

 

The text of the proposed Post-Delisting Deed of Amendment which is annexed to this Shareholders Circular as Annex 3 shows by way of striking through (for deletions) and underscoring (for additions) the changes proposed to be made by the Post-Delisting Deed of Amendment to the text of the Articles as they are currently in effect.

 

Restrictions on the Transfer of Shares

 

The most important change in the Articles that would result from the execution of the Post-Delisting Deed of Amendment, in addition to those described above under the discussion of Item 5 on the AGM Agenda, “Proposed Amendments to the Articles,” would be the introduction of restrictions on the transferability of the Company’s Shares. The Post-Delisting Deed of Amendment will prohibit any transfer of shares in the capital of the Company which are acquired after the date of execution of the Post-Delisting Deed of Amendment (the “Post-Delisting Amendment Date”) unless such transfer is approved in advance by the Company’s Board of Directors (which will be controlled by the Purchaser after the Offer Closing). This restriction on transferability of shares will not apply to shares acquired prior to the Post-Delisting Amendment Date and will in any event cease to be applicable after March 1, 2019. Shares held in registered form by a shareholder as of the Post-Delisting Amendment Date (an “Initial Transferring Shareholder”) may initially be freely transferred by such Initial Transferring Shareholder to any person, without being subject to any approval by the Board of Directors of the Company; however, the transferee who acquires shares from an Initial Transferring Shareholder after the Post-Delisting Amendment Date cannot further transfer those shares without the approval of the Board of Directors. This will also apply to persons to whom DTC transfers registered ownership of shares after the Post-Delisting Amendment Date. See the discussion above of Item 5 on the AGM Agenda, “Proposed Amendments to the Articles – Requirement of a Notarial Deed for Transfer of Shares – When Is a Dutch Notarial Deed Required? – Shares Held through DTC.”

 

In response to a request for approval of transfer of shares by a shareholder who acquires shares after the Post-Delisting Amendment Date, the Board of Directors must, within three months of the request for approval of the transfer, either

 

·grant the approval for the proposed transfer; or

 

·reject the proposed transfer provided that the Board, simultaneously with its rejection of the proposed transfer, designates a third party purchaser who is willing and able to purchase the shares that are proposed to be transferred, for a cash purchase price equal to the fair market value of such shares at the time of transfer, as determined by the Board of Directors in its sole discretion.

 

If the Board of Directors does not respond to a request for approval of a proposed transfer within three months of the Board’s receipt of such request, or designate an alternative third party purchaser for the shares proposed to be transferred, as described above, the Board will be deemed to have granted its approval for the proposed transfer.

 

In the event that the Board approves, or is deemed to approve, a proposed transfer of shares, the transfer must be effected within three months of the date of the Board’s approval, or deemed approval, of the relevant transfer.

 

All of the transfer restrictions described above will cease to apply after March 1, 2019. Following that date all shares will be freely transferable by all shareholders without restrictions, unless Intel and the Purchaser cause the Articles to be amended, effective after that date, to further extend the transfer restrictions introduced into the Articles by the Post-Delisting Deed of Amendment, or to adopt further restrictions on the transferability of the Company’s shares.

 

 

 

 

Other Amendments to the Articles

 

The Post-Delisting Deed of Amendment will effect the following further amendments to the Articles, in addition to those listed above at the discussion of Item 5 on the AGM Agenda, “Proposed Amendments to the Articles”:

 

(1)After the execution of the Post-Delisting Deed of Amendment the Articles will prohibit the transfer of voting rights to the pledgee or usufructuary of any shares which are acquired by any person during the period beginning on the Post-Delisting Amendment Date and ending on March 1, 2019 (the “Lock-Up Period”). This provision will not apply to any holder of shares in registered form as of the Post-Delisting Amendment Date but will apply to any person to whom registered ownership of shares is transferred during the Lock-Up Period. See “Restrictions on the Transfer of Shares” above.

 

(2)The requirement for the Board of Directors to establish an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee will be removed from the Articles.

 

(3)The latest date on which the notice of a shareholders’ meeting is required to be given will be changed from the fifteenth day prior to the date of the meeting to the eighth day prior to the date of the meeting.

 

(4)After execution of the Post-Delisting Deed of Amendment the Articles will provide that a resolution by the general meeting of shareholders can be adopted by a written resolution outside of a formal meeting provided that all persons having the right to attend or vote at a shareholders meeting have declared in writing that they agree to this manner of adopting the relevant resolution.

 

(5)Certain current provisions of the Articles which are typically associated with publicly traded companies, such as provisions relating to publication of notices of shareholders meetings on the Internet, allowing shareholders to vote electronically or through the Internet at shareholders meetings and requiring the results of shareholder votes at shareholders meetings to be posted on the Internet, will be removed from the Articles.

 

EXPLANATION OF ITEM 7 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (DISCUSSION OF 2016 DIRECTOR COMPENSATION)

 

Disclosures Relating to Director Compensation for the Year 2016

 

Pursuant to Section 135, paragraph 5a, of Book 2 of the DCC the Company is required to make certain disclosures in this Shareholders Circular with respect to the compensation paid to the members of the Company’s Board of Directors, and of equity incentive awards generally, for the year ended December 31, 2016.

 

Director Compensation During the Year 2016

 

Professor Amnon Shashua and Mr. Ziv Aviram received the following compensation (excluding stock-based compensation) from the Company and its subsidiaries during the year 2016. Professor Shashua and Mr. Aviram did not receive any compensation as such for serving on the Company’s Board of Directors. The figures set forth in the table below thus reflect solely the compensation received by them from the Company’s wholly-owned Israeli subsidiary MVT for their services as employees of MVT during the relevant period. The table does not include any amounts paid to reimburse Professor Shashua or Mr. Aviram for costs incurred by them in providing services.

 

 

 

 

 

NON-STOCK-BASED COMPENSATION OF AMNON SHASHUA AND ZIV AVIRAM,

January 1, 2016-December 31, 2016 (in thousands of United States dollars)

 

Name of Director

Base Salary

 

Bonus Profit-Sharing Pension
Contribution
and Other
Social Benefits
TOTAL

Amnon Shashua

 

125 0 0 100 225

Ziv Aviram

 

125 0 0 194 319

 

Our general meeting of shareholders, acting pursuant to a proposal of our Board of Directors, determines the compensation of our non-executive directors. In July 2014, our general meeting of shareholders adopted a resolution approving cash compensation to our non-executive directors of US$ 50,000 per year (the “Annual Directors’ Fees”). For the period between January 1, 2016 and December 31, 2016 the Company paid pursuant to this resolution US$ 50,000 in Annual Directors’ Fees to each of the Company’s non-executive directors for service on the Company’s Board. The Annual Directors’ Fees are payable in four installments of US$ 12,500 each, payable in advance on the first day of each calendar quarter.

 

Disclosures Concerning Equity Incentive Awards

 

As of December 31, 2016, Professor Amnon Shashua and Mr. Ziv Aviram held fully vested Company Options for 2,250,000 Shares each at an exercise price of US$ 3.70 per Share, expiring March 1, 2020, which Company Options were granted prior to January 1, 2016; fully vested Company Options for 5,875,000 and for 5,625,000 Shares, respectively, at an exercise price of US$ 6.98 per Share, expiring January 13, 2021, which Company Options were granted prior to January 1, 2016; Company Options for 2,200,000 Shares each at an exercise price of US$ 57.58 per Share (the “2015 Options”), which were granted on September 6, 2015 and Company Options for 2,000,000 Shares each at an exercise price of US$ 46.881 per Share, which were granted on August 15, 2016 (the “2016 Options”). As of December 31, 2016 one-third of the 2015 Options (733,333 Shares for each of Professor Shashua and Mr. Aviram) had vested. The remainder of the 2015 Options will vest in two equal annual installments on September 6 of each year beginning on September 6, 2017. The 2016 Options will vest over a four-year period ending August 15, 2020, with one-fourth of the 2016 Options vesting on August 15 of each year beginning with the year 2017.

 

Pursuant to the Employment Agreement Addendum Professor Shashua has agreed, subject to certain conditions, to deferred vesting after the Offer Closing of the remaining unvested Company Options held by him. See the discussion of Item 1 on the AGM Agenda above, “Summary of Key Terms of the Offer and the Purchase Agreement — Certain Other Agreements — Employment Agreement Addendum.”

 

As of December 31, 2016, Eyal Desheh held Company Options for 100,000 Shares at an exercise price of EUR 0.01 per Share, expiring January 7, 2020. These Company Options became fully vested on March 31, 2017.

 

In addition, each other person currently serving as a non-executive director of the Company held on December 31, 2016 Company Options for 50,000 Shares at an exercise price of US$ 25.00 per share (the initial offering price to the public of the Company’s shares in the Company’s initial public offering (the “IPO”)), with a five-year vesting schedule ending on September 7, 2021. The grant of these Company Options to non-executive directors other than Eyal Desheh was made pursuant to a resolution of the general meeting of shareholders adopted in July 2014. The Company and the Purchaser have agreed that these options held by the non-executive directors other than Mr. Desheh (whose options are already fully vested) will accelerate and become fully vested, and converted into the right to receive cash (see the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement The Purchase Agreement and the Offer Treatment of Equity Awards”), at the Offer Closing.

 

During 2016, no new equity grants were made to, or held or exercised by, directors during the relevant individual’s term of service as director, except as described above.

 

 

 

 

The closing price on the NYSE of our shares on May 5, 2017 was US$ 61.90.

 

As of January 1, 2016, Company Options for 27,188,687 Shares were held by all participants in the Company’s equity incentive plans (including directors and also including an immaterial number of Company Options held by service providers who are not employees). Grants of Company Options for a total of 4,576,500 Shares at a weighted average exercise price of US$ 45.91 per Share were made under the Company’s equity incentive plans during the period beginning January 1, 2016 and ending December 31, 2016. Company Options for 2,822,250 Shares were exercised or forfeited during this period. As a result, Company Options for 28,942,937 Shares were outstanding under the Company’s equity incentive plans as of December 31, 2016. These Company Options that were outstanding as of December 31, 2016 had a weighted average exercise price of US$ 20.82 per Share and a weighted average remaining life of 4.48 years as of December 31, 2016.

 

As of January 1, 2016 281,181 Company RSUs were outstanding under the Company’s equity incentive plans. During the period beginning January 1, 2016 and ending December 31, 2016, 205,962 Company RSUs were granted under the Company’s equity incentive plans. During 2016, 144,484 Company RSUs became vested Company RSUs and 16,372 Company RSUs were forfeited. As a result 326,287 unvested RSUs were outstanding under the Company’s equity incentive plans as of December 31, 2016.

 

No loans were made by the Company to any directors during the year 2016. In addition, the Company did not make any severance payments to any director during the course of the year 2016.

 

For a description of the treatment of equity awards following the Offer Closing, see the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement — The Purchase Agreement and the Offer — Treatment of Equity Awards.” For a quantification of the cash benefits to be realized by the Company’s directors in respect of the Terminating RSUs and the Terminating Options, if the Offer Closing occurs, see the Schedule 14D-9, Item 3(a), “Past Contacts, Transactions, Negotiations and Agreements — Arrangements with Current Executive Officers and Directors of the Company — Treatment of Unvested Mobileye RSUs” and “— Treatment of Mobileye Options Subject to Accelerated Vesting Solely as a Result of the Transactions.”

 

Discussion of Director Compensation at the Annual General Meeting

 

At the Annual General Meeting shareholders will have the opportunity to discuss the compensation paid to directors during 2016. Shareholders will not be entitled at the AGM to adopt any resolution of any kind, binding or non-binding, or to cast any vote, including any purely advisory vote, relating to past, present or future compensation of the Company’s directors.

 

EXPLANATION OF ITEM 8 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (ADOPTION OF THE 2016 ACCOUNTS)

 

The Company prepares its financial statements filed with the SEC in accordance with U.S. GAAP.

 

In addition, under Dutch law the Company is required to prepare its official Dutch statutory accounts in accordance with either International Financial Reporting Standards (“IFRS”) or Netherlands generally accepted accounting principles and to submit such reports to the general meeting of shareholders for adoption by the general meeting of shareholders. The Company has elected to prepare its Dutch statutory accounts in accordance with IFRS. Accordingly, at the AGM, in accordance with the provisions of Dutch law that are applicable to all Dutch companies, shareholders will be asked to adopt the 2016 Accounts, being the Company’s Dutch statutory annual accounts prepared in accordance with IFRS for the year ended December 31, 2016. The draft 2016 Accounts are attached to this Shareholders Circular as Annex 4.

 

 

 

 

Our 2016 net profits in the amount of approximately US$ 108.8 million, as shown in the 2016 Accounts, will be added to the Company’s retained earnings reserve. There will thus be no distribution payable to shareholders as a result of the adoption of the 2016 Accounts.

 

Please note that the Company’s financial statements filed with the SEC, which are prepared in accordance with U.S. GAAP, may differ, potentially materially, from the accounting principles used in preparing the 2016 Accounts in accordance with IFRS that you are being asked to adopt at the AGM.

 

EXPLANATION OF ITEM 9 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (DISCHARGE OF DIRECTORS THROUGH DECEMBER 31, 2016)

 

Under Dutch law, at the Annual General Meeting shareholders may discharge the members of our Board of Directors from liability in respect of the exercise of their duties during the year 2016.

 

Accordingly, it is proposed that shareholders resolve at the AGM to discharge the members of our Board of Directors from liability in respect of the exercise of their duties during the year ended December 31, 2016.

 

The discharge proposed to be granted to all members of the Board of Directors is in accordance with the provisions of Dutch law, is without prejudice to the provisions of the laws of The Netherlands relating to bankruptcy and does not extend to matters not disclosed to all shareholders.

 

EXPLANATION OF ITEM 10 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (FURTHER DISCHARGE OF DIRECTORS AS OF THE ACCEPTANCE TIME)

 

Discharge of Directors through the AGM Date

 

In addition to the discharge granted to directors in respect of the exercise of their duties during the year 2016 (see the discussion above of Item 9 on the AGM Agenda), the Company is, in connection with the Offer, requesting shareholders at the AGM to adopt a resolution granting further discharge to the directors of the Company, effective as of the Acceptance Time, for liability in respect of the exercise of their duties through the date on which the Annual General Meeting is held.

 

This discharge proposed to be granted to all members of the Board of Directors is in accordance with the provisions of Dutch law, is without prejudice to the provisions of the laws of The Netherlands relating to bankruptcy and does not extend to matters not disclosed to all shareholders. This discharge is also without prejudice to, and does not limit in any way, any discharge previously granted to the directors of the Company, or to the members of the former (prior to the IPO) Supervisory Board of the Company, or any discharge which is granted, or will be granted, to the directors of the Company at the AGM (see the discussion above of Item 9 on the AGM Agenda) or any subsequent general meeting of shareholders of the Company (see “Future Discharge of Directors” below).

 

Future Discharge of Directors

 

The Purchaser has undertaken in the Purchase Agreement that it will, at the first annual or extraordinary general meeting of shareholders of the Company held after the Offer Closing, cause the adoption by the general meeting of shareholders of the Company of a resolution providing full and final discharge to the Resigning Directors (see the discussion of Item 12 on the AGM Agenda) for the performance of their duties. In addition, the Purchaser has undertaken that the Company will, at the first annual or extraordinary general meeting of shareholders held after the resignation of an Independent Director from the Company’s Board of Directors (see the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the

 

 

 

 

Purchase Agreement The Purchase Agreement and the Offer Composition of the Board of Directors after the Offer Closing”), cause the adoption by the general meeting of shareholders of the Company of a resolution granting full and final discharge to the resigning Independent Director for the performance of his duties. All such resolutions for the full and final discharge of the Resigning Directors and the Independent Directors will be subject to the general limitations of Dutch law, as discussed above under “Discharge of Directors through the AGM Date.”

 

Further Undertakings by Intel and the Purchaser

 

Intel and the Purchaser have undertaken for the benefit of the Company’s directors in the Purchase Agreement that, regardless of the scope of discharge granted to directors at the AGM or any subsequent general meeting of shareholders, neither Intel nor the Purchaser, nor any of their successors and assigns, may, if they become a shareholder of the Company, assert any claim against any director for liability (i) based on acts or omissions disclosed in the Purchase Agreement, in certain related Company disclosures made on a confidential basis to Intel and the Purchaser upon signature of the Purchase Agreement, or in the Company’s SEC filings through the date of the Purchase Agreement (other than any forward-looking disclosures contained in such SEC filings) or (ii) any acts or omissions of directors prior to the Offer Closing (or, in the case of the Independent Directors, after the Offer Closing), that are required to be taken under the Purchase Agreement.

 

EXPLANATION OF ITEM 11 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (RE-ELECTION OF TOMASO POGGIO, ELI BARKAT AND JUDITH RICHTER AS NON-EXECUTIVE DIRECTORS)

 

Background

 

The Company proposes the re-election of Tomaso Poggio, Eli Barkat and Judith Richter as non-executive directors of the Company, to serve for a three-year term ending at the close of the annual general meeting of shareholders of the Company to be held in the year 2020.

 

The Company’s executive directors, who are currently the Company’s Founders Professor Amnon Shashua and Mr. Ziv Aviram, are responsible for the day-to-day management of the Company, in accordance with the policies adopted from time to time by the Board of Directors as a whole. The executive directors must comply with any specific instructions given to them by the Board of Directors as a whole.

 

Our non-executive directors supervise the conduct of our business by our executive directors and provide general advice to our executive directors. Our non-executive directors are not involved in the Company’s day-to-day management except in relation to those matters specifically assigned to the non-executive directors or the Board of Directors as a whole pursuant to Dutch law, the Articles or the Company’s corporate governance guidelines.

 

Only the executive directors are authorized to represent the Company by signing contracts or entering into other dealings with third parties.

 

Biographical information concerning Tomaso Poggio, Eli Barkat and Judith Richter is set forth below.

 

Each of Messrs. Poggio and Barkat, and Dr. Richter, will resign from the Board of Directors effective as of the Offer Closing.

 

Director Biographies

 

Tomaso A. Poggio was elected to our board of directors as a non-executive director effective in July 2014, immediately prior to our IPO. Since 2013, Professor Poggio has been Director of the Center for Brains, Minds, and Machines at the Massachusetts Institute of Technology (“MIT”). Since 1982, Professor Poggio has been

 

 

 

 

a professor at MIT in the Department of Brain & Cognitive Sciences, Computer Science & Artificial Intelligence Laboratory and since 2000 also in the McGovern Institute for Brain Research. A former Corporate Fellow of Thinking Machines Corporation, Professor Poggio was a director of PHZ Capital Partners, Inc. and was involved in starting, or investing in, several other high-tech companies, including Arris Pharmaceutical Corp., DigitalPersona, Inc. and DeepMind. Professor Poggio holds a Ph.D in Theoretical Physics from the University of Genoa.

 

Eli Barkat was elected to our board of directors as a non-executive director effective July 2014, immediately

prior to our IPO. In 1988, Mr. Barkat co-founded BRM Group (formerly BRM Technologies), which is a private investment fund that invests in high-tech and financial markets. Mr. Barkat serves as Chairman of BRM Group, Chairman of MEITAV-DS Investments, Ltd. and as a director of GigaSpaces Technologies Playscape, Logdog and Nsof. Mr. Barkat holds a B.Sc. in Computer Science and Mathematics from the Hebrew University.

 

Judith Richter was elected to our board of directors as a non-executive director effective in July 2014, immediately prior to our IPO. In 1993, Dr. Richter founded Medinol Ltd., a global medical device company based in Israel, and since then has served as Medinol Ltd.’s Chief Executive Officer. In 1992, Dr. Richter founded Medcon Ltd., a global provider of web-based cardiac imaging and information management, and served as its Chief Executive Officer through 1993, and then as a member of its board of directors. From 1994 to 2000, Dr. Richter served on the board of directors of Bezeq Ltd., Israel’s leading telecommunications company. During this period, Dr. Richter also served on the board of directors of Emital, an international subsidiary of Bezeq Ltd. in Hungary. Dr. Richter has been a member of the Executive Committee of the Hebrew University in Jerusalem since 2006. Dr. Richter was also a faculty member at Tel-Aviv University’s Graduate School of Business Administration from 1984 to 1993. Dr. Richter holds a Ph.D in Organizational Psychology from Boston University and an M.A. from the Hebrew University in Jerusalem.

 

EXPLANATION OF ITEM 12 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (ELECTION OF NEW DIRECTORS, EFFECTIVE AS OF THE OFFER CLOSING, TO REPLACE THE RESIGNING DIRECTORS)

 

Background

 

The Resigning Directors (Amnon Shashua, Ziv Aviram, Tomaso A. Poggio, Eli Barkat and Judith Richter) will resign from the Company’s Board of Directors, effective as of the Offer Closing.

 

Eyal Desheh and Peter Seth Neustadter will continue to serve on the Board of Directors as Independent Directors. See the discussion above under Item 1, “Summary of Key Terms of the Offer and the Purchase Agreement The Purchase Agreement and the Offer Composition of the Board of Directors after the Offer Closing.”

 

Intel and the Purchaser have proposed the election by shareholders, pursuant to the Governance Resolution to be adopted at the AGM, of the nominees listed below to the Board of Directors, as a replacement for the Resigning Directors, effective as of the Offer Closing. The Nominating and Corporate Governance Committee of the Board of Directors has subsequently after due consideration concurred in such nomination by Intel and the Purchaser. The Board of Directors recommends the election of the following persons (the “Post-Offer Closing Directors”) to the Board of Directors, effective as of the Offer Closing, to replace the Resigning Directors:

 

·To serve for a one-year term ending at the close of the annual general meeting of shareholders of the Company to be held in the year 2018:

 

Tiffany D. Silva

 

 

 

 

David J. Miles

 

If Ms. Silva and Mr. Miles become directors in the year 2018, they will serve for a two-year term ending at the close of the annual general meeting of shareholders of the Company to be held in the year 2020.

 

·To serve for a three-year term ending at the close of the annual general meeting of shareholders of the Company to be held in the third calendar year following the calendar year during which such individuals become directors of the Company:

 

Nicholas J. Hudson

 

Mark L. Legaspi

 

Gary Kershaw

 

The Rules and Regulation of the Board of Directors of the Company currently provide, consistent with the requirements of the Dutch Governance Code, that a majority of the Company’s non-executive directors must consist of independent directors. This will no longer be the case after the election, effective as of the Offer Closing, of the Post-Offer Closing Directors to the Board. It is anticipated that Intel and the Purchaser will, after the Offer Closing, cause the Rules and Regulations of the Board of Directors to be amended to remove the requirement that a majority of the non-executive directors must be independent directors.

 

Of the Post-Offer Closing Directors Tiffany D. Silva and David J. Miles will serve as executive directors of the Company and Nicholas J. Hudson, Mark L. Legaspi and Gary Kershaw will serve as non-executive directors of the Company.

 

Biographical information concerning the Post-Offer Closing Directors is set forth below.

 

Effect of Non-Adoption of the Governance Resolution

 

If the Governance Resolution, electing the Post-Offer Closing Directors to serve on the Company’s Board of Directors effective as of the Offer Closing, is not adopted by shareholders at the AGM or a Subsequent EGM, the Purchaser will not be legally obligated to purchase any Shares tendered to it in the Offer, and the Offer Closing will not occur. See the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement The Purchase Agreement and the Offer Conditions of the Offer.”

 

Biographies of the Post-Offer Closing Directors

 

Tiffany D. Silva has served as in-house counsel to Intel since 1999 and is an officer and director of numerous subsidiaries of Intel. Prior to joining Intel, Ms. Silva was an attorney at Gibson, Dunn & Crutcher LLP.

 

David J. Miles has served as Intel’s EMEA Tax Director since April 2016 and has held various management roles in Intel’s Tax organization. Mr. Miles joined Intel in September 2005.

 

Nicholas J. Hudson has served as Intel’s EMEA Director of Finance since February 2014 and is an officer and director of numerous subsidiaries of Intel. Mr. Hudson joined Intel in 1993 straight from public practice, where he obtained his Chartered Accountant qualification.

 

Mark L. Legaspi has served as in-house counsel to Intel’s Strategic Transactions Group and Intel Capital since 2012. Prior to joining Intel, Mr. Legaspi was a Vice President and Counsel for The Blackstone Group, after working for several years in private practice at Proskauer Rose LLP.

 

 

 

 

Gary Kershaw has served as a Vice President of Intel since 2012 and as an Assistant Treasurer of Intel since 1999. Mr. Kershaw joined Intel in 1987 and has held various management roles in Intel’s Finance organization.

 

EXPLANATION OF ITEM 13 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (APPROVAL OF COMPENSATION OF INDEPENDENT DIRECTORS)

 

Under the Articles the general meeting of shareholders is required to approve the compensation of the Company’s non-executive directors. Shareholders are now being requested to approve the following compensation of the Independent Directors, after the Offer Closing:

 

Each Independent Director would after the Offer Closing be entitled to compensation of US$ 100,000 on an annual basis, with a quarterly payment of US$ 25,000 being due to each Independent Director beginning on the first business day of the first calendar quarter following the Offer Closing and on the first business day of each subsequent calendar quarter during which the relevant Independent Director continues to serve on the Board of Directors. The Independent Directors would be entitled to receive compensation as follows for the calendar quarter which includes the date on which the Offer Closing (the “Offer Closing Date”) occurs:

 

·a prorated portion of the Annual Directors’ Fee of US$ 12,500 normally payable in respect of such calendar quarter (see the discussion of Item 7 on the AGM Agenda, “Disclosures Relating to Director Compensation for the Year 2016 – Director Compensation During the Year 2016”), for the period through the Offer Closing Date; and

 

·for the period beginning on the Offer Closing Date, a prorated portion of the US$ 25,000 fee payable to the Independent Directors after the Offer Closing.

 

Any advance payment of Annual Directors’ Fees received by the relevant Independent Directors in respect of the calendar quarter which includes the Offer Closing Date would be credited against the total payment due by the Company in respect of such calendar quarter, with the full amount of such payment (after taking into account the foregoing deduction) being due to the Independent Directors on the Offer Closing Date.

 

EXPLANATION OF ITEM 14 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (GRANT OF AUTHORITY TO REPURCHASE SHARES)

 

Under Dutch law and the Articles, the Board of Directors may, subject to compliance with certain Dutch statutory provisions, be authorized to cause the Company to repurchase the Company’s shares in an amount, at prices and in the manner authorized by the general meeting of shareholders. Such authorization may continue for a maximum period of 18 months, and may be given on a rolling basis.

 

The Company believes that the Company would benefit by granting authority to the Board of Directors to repurchase the Company’s shares. For example, to the extent the Board believes that the Company’s shares may be undervalued at the market levels at which they are then trading, repurchases of shares may offer the possibility of strengthening the value of the Company’s shares. Such shares could be used for any valid corporate purpose, including use under the Company’s compensation plans, sale in connection with the exercise of outstanding options or for acquisitions, mergers or similar transactions. The reduction in the Company’s issued capital resulting from any repurchases will increase the proportionate interest of the remaining shareholders in the Company’s net worth and whatever future profits the Company may earn. The number of shares repurchased, if any, and the timing and manner of any repurchases would be determined by the Board of Directors, in light of prevailing market conditions, the Company’s available resources and other

 

 

 

 

factors that cannot now be predicted. The number of shares held by the Company and its subsidiaries may generally, for as long as the Company continues to be an N.V. and is not converted into a B.V. (see the discussion above of Items 4, 5 and 6 on the AGM Agenda), never exceed 50% of the total number of the Company’s issued and outstanding shares.

 

In order to provide the Company with sufficient flexibility to repurchase its shares without calling a special shareholders meeting for each separate repurchase, the Company proposes that shareholders grant authority to the Board for the repurchase of up to 10% of the Company’s issued share capital on the open market, or through privately negotiated repurchases or in self-tender offers, for a price per share not less than the nominal value of a share and not greater than 110% of the most recent available (as of the time of repurchase) price of a share on any securities exchange on which the Company’s shares are listed or quoted at the time of repurchase.

 

If at the time of repurchase the Company’s shares are not listed or quoted on any securities exchange, the maximum price payable by the Company for the repurchase of shares could not exceed 110% of the fair market value of the Company’s shares at the time of repurchase, as determined by the Board of Directors acting in good faith. The foregoing will be applicable after the Offer Closing, once the Shares have been delisted from the NYSE, if Intel and the Purchaser do not cause the Company to be converted from an N.V. to a B.V. following the Offer Closing.

 

See the discussion of Item 5 on the AGM Agenda, “Proposed Amendments to the Articles – Other Amendments to the Articles,” paragraphs (6), (7) and (9), for a description of the provisions of the Articles relating to the repurchase of the Company’s own shares that would be in place following the conversion by the Company from an N.V. to a B.V.

 

The Purchaser has indicated that repurchase of Shares may constitute one of the forms of Post-Offer Reorganization that the Purchaser and Intel may cause the Company to effect after the Offer Closing. See the discussion of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement — The Purchase Agreement and the Offer — Post-Offer Reorganization” and “Alternative Post-Closing Restructurings.” Repurchase of Shares after the Offer Closing may require approval of the Independent Directors, if such repurchase would be deemed to be an Independent Director Approval Transaction, as described under the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement — The Purchase Agreement and the Offer — Composition of the Board of Directors after the Offer Closing.”

 

The authority to repurchase Shares would in principle extend for 18 months from the date of the Annual General Meeting, until December 13, 2018. However, after conversion of the Company from a N.V. to a B.V., no prior authorization of the general meeting of shareholders will be required for the repurchase of shares by the Company, and the Board of Directors will be authorized to repurchase the Company’s shares, at any time, without any prior approval of the general meeting of shareholders. See the discussion above of Item 5 on the AGM Agenda, “Proposed Amendments to the Articles – Other Amendments to the Articles,” paragraph (6).

 

The grant of authority to repurchase shares will, if approved by shareholders, supersede and replace all previous grants of authority to repurchase shares by the general meeting of shareholders to the Board of Directors.

 

EXPLANATION OF ITEM 15 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (APPOINTMENT OF PWC AS AUDITORS OF THE COMPANY’S 2017 STATUTORY ACCOUNTS)

 

The Audit Committee of the Company’s Board of Directors has recommended that PWC be appointed as our independent registered public accounting firm to audit the Company’s Dutch statutory accounts prepared in accordance with IFRS for the year ending December 31, 2017. PWC has acted as the Company’s independent registered public accounting firm for the purpose of auditing all of the Company’s statutory accounts prepared

 

 

 

 

in accordance with IFRS, beginning with the Company’s statutory accounts for the year ended December 31, 2011.

 

Representatives of PWC are expected to be present at the Annual General Meeting. They will have an opportunity to make a statement, if they desire, and are expected to be available to respond to appropriate questions.

 

After the Offer Closing the Purchaser may cause a new auditor of the Company’s Dutch statutory accounts to be appointed for the years ending December 31, 2018 and thereafter.

 

EXPLANATION OF ITEM 16 ON THE AGENDA FOR THE ANNUAL GENERAL MEETING (DISCUSSION OF DIVIDEND POLICY)

 

Under the Dutch Governance Code, we are required to provide shareholders with an opportunity at the Annual General Meeting to discuss our dividend policy and any major changes in that policy. Shareholders will not be entitled to adopt a binding resolution determining our future dividend policy.

 

We have never paid or declared any dividends on our Shares. Moreover, even if future operations were to lead to significant levels of profits that would allow us to pay dividends, we currently intend to retain all available funds for reinvestment in our business. Any decision to declare and pay dividends in the future will be made at the discretion of our general meeting of shareholders, acting pursuant to a proposal by our Board of Directors, and will depend on, among other things, our results of operations, financial condition, future prospects, contractual restrictions, restrictions imposed by applicable law and other factors our Board of Directors and general meeting of shareholders may deem relevant.

 

We are unable to predict the dividend policy that may be put in place by Intel and the Purchaser after the Offer Closing. However, it should be noted that certain of the Alternative Post-Closing Restructurings contemplated by the Purchase Agreement may involve the making of distributions on the Shares after the Offer Closing. See the discussion above of Item 1 on the AGM Agenda, “Summary of Key Terms of the Offer and the Purchase Agreement — The Purchase Agreement and the Offer — Post-Offer Reorganization” and “— Alternative Post-Closing Restructurings.” In addition, if the Asset Sale, Liquidation and Second Step Distribution occur after the Offer Closing, the Company will in any event, after the Liquidation has become effective, make the Second Step Distribution to shareholders. See the discussion above of Items 2 and 3 on the AGM Agenda.

 

If the Company is converted from an N.V. to a B.V. after the Offer Closing (see the discussion above of Items 4, 5 and 6 on the AGM Agenda), the provisions of the Articles and of Dutch law applicable to the payment of distributions to shareholders by the Company will be different from those that are currently in effect. See the discussion above of Item 5 on the AGM Agenda, “Proposed Amendments to the Articles – Other Amendments to the Articles,” paragraph (14).

 

 

 

 

ANNEX 1

 

FORM OF ASSET SALE AGREEMENT

 

 

 

 

EXHIBIT A

 

 

 

ASSET SALE AGREEMENT

 

dated as of

 

[●]

 

by and between

 

CYCLOPS HOLDINGS, LLC

 

and

 

MOBILEYE N.V.

 

 

 

[NOTE: The final draft should reflect the information on the Business (particularly information on the Business set out in the Schedules) as at the date of the Purchase Agreement, but the final Asset Sale Agreement to be entered into between the parties after the Offer, if applicable, shall be updated until signing of the Asset Sale Agreement with all relevant additional information as appropriate.]

 

 

 

 

TABLE OF CONTENTS

 

 

Page

Article 1 Interpretation 2
Article 2 Sale and Purchase 3
Article 3 Purchase Price 3
Article 4 Conditions to Completion 5
Article 5 Completion 5
Article 6 Tax 6
Article 7 Contracts 6
Article 8 Financing and Guarantees 7
Article 9 Transfer of any Other Assets and Liabilities 7
Article 10 Wrong Box Assets 8
Article 11 Amounts Received in Error 9
Article 12 Company’s Warranties 9
Article 13 Buyer’s Warranties 9
Article 14 Breaches 10
Article 15 Buyer’s Indemnities 10
Article 16 Third Party Claims 11
Article 17 Covenants 11
Article 18 Liquidation 12
Article 19 Cost Arrangement and Reimbursement 13
Article 20 Confidentiality 14
Article 21 Payments 14
Article 22 Termination 15
Article 23 Miscellaneous 15
Schedule 1  Completion 24
Schedule 2  Tax Matters 27
Schedule 3  Contracts 31
Schedule 4  Guarantees 32
Schedule 5  Deed of Adherence 33
Schedule 6  Company Subsidiaries 35
Schedule 7  Bank Accounts 36
Schedule 8  Interpretation 37
Schedule 9  Indemnification Agreements 42

 

 i 

 

 

THIS ASSET SALE AGREEMENT (the “Agreement”) is made on [●], 201[●]

 

BETWEEN:

 

(1)Cyclops Holdings, LLC, a Delaware limited liability company (“Buyer”); and

 

(2)Mobileye N.V., a public limited liability company (naamloze vennootschap) organized under the Laws of The Netherlands (the “Company”)

 

(together the “Parties” and each also a “Party”).

 

BACKGROUND:

 

(A)The Company, Cyclops Holdings, Inc. (which was converted from a Delaware corporation into Buyer, a Delaware limited liability company, on April 4, 2017) and Intel Corporation, a Delaware corporation, entered into that certain purchase agreement, dated March 12, 2017 (the “Purchase Agreement”). Pursuant to the Purchase Agreement, Buyer has made a recommended public offer (the “Offer”) in cash for all the Shares in exchange for an amount in cash equal to USD Sixty-Three Dollars and Fifty-Four Cents ($63.54) per Share, without interest (the “Offer Consideration”).

 

(B)Pursuant to Section 2.04(a) of the Purchase Agreement and subject to the terms and conditions set out therein, (i) the Company Board has convened the EGM or a Subsequent EGM at which the Company’s shareholders (the “Shareholders”) resolved to adopt the Pre-Wired Asset Sale Resolutions (as defined in the Purchase Agreement) in relation to the Transaction (as defined below) and (ii) the Company Board has adopted a resolution to transfer the Business to Buyer or one of Buyer’s Affiliates, if the Asset Sale Threshold is met.

 

(C)Buyer has notified the Company that it desires to acquire the Business.

 

(D)By and subject to this Agreement, the Company wishes to sell and assign and/or transfer (as the case may be) and Buyer wishes to purchase and accept or assume (as the case may be) the Business (the “Asset Sale”) on the terms and subject to the conditions set out in this Agreement (the Asset Sale together with the Liquidation, Second Step Distribution and the other transactions contemplated by this Agreement, the “Transaction”).

 

(E)The Offer has been commenced, accepted for payment and closed and paid in accordance with the terms and conditions of the Purchase Agreement.

 

(F)The Subsequent Offering Period has been completed, allowing Shareholders another cash exit at the Offer Consideration.

 

(G)Prior to the expiration of the Subsequent Offering Period, Buyer has publicly announced its intention to implement the Asset Sale and the Second Step Distribution and Liquidation.

 

 

 

 

(H)Buyer has extended the Subsequent Offering Period in accordance with Section 2.01(f) of the Purchase Agreement to permit any remaining Minority Shareholders to tender their Shares in exchange for the Offer Consideration in the Minority Exit Offering Period.

 

(I)Buyer and the Company have agreed that following completion of the Asset Sale, the Liquidation will become effective and result in the Second Step Distribution.

 

(J)Taking into consideration that:

 

(a)the Pre-Wired Asset Sale Resolutions have been approved by the EGM or a Subsequent EGM in accordance with Section 2.04 of the Purchase Agreement;

 

(b)the Closing has occurred and the Subsequent Offering Period and the Minority Exit Offering Period have been completed;

 

(c)the number of Shares validly tendered in accordance with the terms of the Offer (including in the Subsequent Offering Period and the Minority Exit Offering Period) and not properly withdrawn, together with the Shares owned by Buyer or any of its Affiliates, on the date of this Agreement is at or above the Asset Sale Threshold; and

 

(d)Buyer has requested the Company to execute and implement the Asset Sale as contemplated in this Agreement and in accordance with Section 2.07(b) of the Purchase Agreement,

 

the Parties wish to enter into this Agreement and will, upon the terms and subject to the conditions of this Agreement, effect (i) the Asset Sale and (ii) the subsequent Liquidation resulting in the Second Step Distribution.

 

(K)The Parties wish to set forth in this Agreement their respective rights and obligations in respect of the Transaction.

 

(L)The Parties are entering into this transaction as a “second-step” transaction following the successful completion of the Offer under the Purchase Agreement (similar to a statutory merger in other jurisdictions) for the purpose of business integration while simultaneously providing Minority Shareholders (as hereinafter defined) the opportunity to exit from the Company for the same per Share cash consideration that the Buyer has paid to the other Shareholders in the Offer.

 

IT IS AGREED as follows:

 

Article 1

Interpretation

 

Section 1.1      In addition to terms defined elsewhere in this Agreement, the definitions and other provisions in Schedule 8 (Interpretation) apply throughout this Agreement unless a different intention clearly appears. Capitalized terms not defined in this Agreement or in

 

 2 

 

 

Schedule 8 (Interpretation) shall have the meaning given to such terms in the Purchase Agreement.

 

Section 1.2      In this Agreement, unless a different intention clearly appears, a reference to a Clause, Subclause or Schedule is a reference to a clause, subclause or schedule of this Agreement. The Schedules are part of this Agreement.

 

Section 1.3      The headings used in this Agreement shall not affect its interpretation.

 

Article 2

Sale and Purchase

 

Section 2.1    Subject to the provisions of this Agreement, the Company hereby sells and agrees to assign and/or transfer (as the case may be) to Buyer at Completion and Buyer hereby purchases and agrees to accept and/or assume (as the case may be) at Completion, the Business, with a view to Buyer carrying on the Business from Completion as a going concern in succession to the Company.

 

Section 2.2      At Completion, all Assets, properties, Liabilities and Contracts directly or indirectly used or required in connection with, or otherwise related to, the Business will be transferred or assigned (as the case may be) to Buyer.

 

Section 2.3      Subject to the Completion Conditions being satisfied or waived (in whole or in part) in accordance with ‎Section 4.1 and subject to the provisions of this Agreement, at Completion the economic benefit and risk of the Business will pass to Buyer, without any carve-outs or exceptions (other than expressly provided for in this Agreement).

 

Article 3

Purchase Price

 

Section 3.1      The Parties agree that the value of the Business is an amount equal to the product of (i) the Offer Consideration multiplied by (ii) the total number of Shares issued and outstanding immediately prior to Completion, which shall be payable on Completion as follows:

 

(a)       Of this value, an amount (the “Cash Purchase Amount”) equal to the product of (x) the Offer Consideration multiplied by (y) the total number of Shares held beneficially or of record by Shareholders other than Buyer or any of its Affiliates (the “Minority Shareholders”) shall be paid at Completion in cash in accordance with ‎Section 3.2; provided that at the discretion of Buyer, Buyer’s obligation to pay the Cash Purchase Amount to the Company may be set off against the Company’s obligation to pay and deliver to Buyer, as part of the transfer of the Business, the unrestricted cash available to the Company as set out in the Company’s balance sheet immediately prior to Completion to the extent such cash would otherwise be freely distributable pursuant to the Second Step Distribution by the Company (the “Company Net Cash Amount”); and

 

 3 

 

 

(b)       In view of the intragroup (except for the participation of the Minority Shareholders) nature of the transfer of the Business to the Buyer and in order to avoid a futile “cash round” payment at Completion from a bank account of the Buyer to (ultimately) the same bank account following the Liquidation, the remainder of the value of the Business will remain outstanding by Buyer to the Company at Completion, and will on that same day be satisfied by setoff (verrekening) against the Liquidation entitlement of the Buyer in the same amount, due by the Company to Buyer at Completion.

 

Section 3.2      Payment of Cash Purchase Amount.

 

(a)       Buyer shall pay, at Completion, the Cash Purchase Amount minus that portion of the Company Net Cash Amount that is set off against the Cash Purchase Amount (the “Net Cash Deduction”) by wire transfer of immediately available funds to the bank account of the Settlement Agent designated in writing by the Company to Buyer at least four (4) Business Days prior to Completion (the “Settlement Agent Account”), for distribution to the Minority Shareholders on behalf of the Company as set forth in this Agreement.

 

(b)       The Company shall pay, at Completion, the amount of the Net Cash Deduction by wire transfer of immediately available funds to the Settlement Agent Account, for distribution to the Minority Shareholders as set forth in this Agreement.

 

Section 3.3      That portion of the Company Net Cash Amount that is not set off against the Cash Purchase Amount and thus not transferred to the Settlement Agent Account at Completion as set forth in ‎‎Section 3.2(b) (such portion of the Company Net Cash Amount being referred to herein as the “Company Excess Cash at Completion” and the Company Excess Cash at Completion together with any cash held by the Company after Completion, being referred to herein as the “Company Excess Cash”) shall be transferred to Buyer as part of the transfer of the Business pursuant to this Agreement.

 

Section 3.4      The Company shall inform Buyer of the amount of the Cash Purchase Amount and the amount of the Net Cash Deduction no later than two (2) Business Days prior to the anticipated day of Completion.

 

Section 3.5      Buyer shall procure that the Cash Purchase Amount shall be sufficient to pay to the Minority Shareholders, by way of the Second Step Distribution, an amount equal to the Offer Consideration for each issued and outstanding Share held by the Minority Shareholders at Completion, without interest and after deduction of dividend withholding or other Tax if and to the extent so required by applicable Law (which Tax shall be paid out of the Cash Purchase Amount, without increasing the Cash Purchase Amount, pursuant to ‎Section 18.2.)

 

Section 3.6      Notwithstanding anything to the contrary in this Agreement, Buyer (including any third-party paying agent) shall be entitled to deduct and withhold from any payment of the Cash Purchase Amount otherwise payable under this Agreement, and from any other payments otherwise required pursuant to this Agreement, such amounts as Buyer shall determine that it is required to deduct and withhold with respect to any such deliveries and payments under applicable Law, taking into account any available reductions or eliminations of withholding that may have been validly claimed under applicable Law. To the extent that such

 

 4 

 

 

amounts are so withheld and timely paid to the appropriate Tax Authority by Buyer or its agent, as the case may be, they shall be treated for all purposes of this Agreement as having been delivered and paid to the Person in respect of which such deduction and withholding was made.

 

Article 4

Conditions to Completion

 

Section 4.1      Completion of the sale and purchase of the Business and the subsequent Liquidation is conditional on the following conditions (the “Completion Conditions”) being satisfied or waived (either in whole or in part) in accordance with ‎Section 4.2 on or before the date of Completion:

 

(a)       no Legal Restraint (as defined in the Purchase Agreement) shall be in effect that prohibits, renders illegal or enjoins the Completion; and

 

(b)       the Pre-Wired Asset Sale Ruling and any other Israeli Tax ruling that may be required in connection with the transactions contemplated hereby shall have been obtained and remain in full force and effect as of the date of Completion.

 

Section 4.2    The Completion Conditions are for the benefit of both the Company and Buyer and may not be waived (either in whole or in part) without the prior written consent of both the Company (including the consent of the Independent Directors) and Buyer.

 

Section 4.3    Each Party will ensure that it duly and timely informs the other Party of all relevant developments regarding the fulfilment of the Completion Conditions.

 

Article 5

Completion

 

Section 5.1      Completion shall take place at the offices of Houthoff Buruma at Gustav Mahlerplein 50, 1082 MA Amsterdam, the Netherlands, at 12:00 a.m. (Amsterdam time) on the third (3rd) Business Day after execution of this Agreement or at such other time and on such other date (subject to prior satisfaction or waiver of the Completion Conditions as set forth in ‎Section 4.2) as the Company and Buyer may agree.

 

Section 5.2      If the Completion Conditions are not satisfied or, where permitted, waived in writing by the Parties as contemplated hereby, on the date that Completion is envisaged to take place pursuant to ‎Section 5.1, Completion will take place on the third (3rd) Business Day after the date on which the Completion Conditions are satisfied or, where permitted, waived in writing by the Parties as contemplated hereby.

 

Section 5.3      At Completion each Party shall do, or procure to be done, those things respectively listed in relation to it or its Group in Schedule 1 (Completion).

 

Section 5.4      None of the Parties shall be obliged to complete the sale and purchase of the Business unless all material things set out in this ‎Article 5 and in paragraphs 1 through

 

 5 

 

 

4(d)(A) of Schedule 1 (Completion) have been done on or prior to Completion. This ‎Section 5.4 shall not, however, prejudice any rights or remedies available to any Party in respect of any default on the part of the other Party.

 

Article 6

Tax

 

Subject to Completion occurring, the provisions of Schedule 2 (Tax Matters) will apply.

 

Article 7

Contracts

 

Section 7.1      Subject to the provisions of this ‎Article 7, the Company shall assign and/or transfer (as the case may be) to Buyer at Completion, and Buyer shall accept or assume (as the case may be) at Completion, all of the present and future rights and benefits of the Company under the Contracts, including those as listed in Schedule 3 (Contracts), and the corresponding obligations specifically referred to therein, by way of transfer of contract in accordance with Article 6:159 of the DCC, or the equivalent thereof under the relevant Law governing such Contract, and Buyer shall indemnify and hold harmless the Company against any and all Liabilities, costs, claims and damages arising from such Contracts.

 

Section 7.2      The Parties will inform the counterparties to the Contracts (the “Counterparties” and each a “Counterparty”) of the sale by the Company of the Business.

 

Section 7.3      The Company shall promptly refer to Buyer all inquiries relating to the Business, and assign to Buyer all orders relating to the Business, which the Company may receive after Completion.

 

Section 7.4      The obligations of the Company under this ‎Article 7 shall in any event end upon the end of the Liquidation, i.e. the date of the definitive striking-off of the Company from the Trade Register pursuant to Section 2:19(4) or Section 2:19(6), as the case may be, of the DCC (the “Liquidation End Date”).

 

Section 7.5      The Parties acknowledge and agree that:

 

(a)       upon or concurrent with Completion, any and all of the Company’s rights and obligations under the Purchase Agreement will be assigned and transferred to Buyer and the relevant and still applicable continuing rights and obligations set out in the Purchase Agreement will continue in full force and effect after Completion in accordance with their terms; provided, that the Independent Directors (who will remain on the Company Board as provided for in the Purchase Agreement) will continue to have the right to effect the rights of the Company set out in the Purchase Agreement to the extent those rights remain relevant and applicable (including the right to effect enforcement of any rights of the Company);

 

 6 

 

 

(b)       the Independent Directors (who will remain on the Company Board as provided for in the Purchase Agreement) will have the right to effect the enforcement of all rights of the Company under this Agreement; and

 

(c)       Buyer shall, and shall procure that its Affiliates (including the Company) shall, execute all such deeds, documents and assurances, and perform such acts and things reasonably required to ensure that the Parties and their representatives (if any) give effect to the provisions of this ‎Section 7.5.

 

This ‎Section 7.5 shall apply mutatis mutandis to any subsequent successor or assignee of Buyer.

 

Article 8

Financing and Guarantees

 

Section 8.1      Guarantees and Indemnities.  Buyer shall, with the reasonable assistance of the Company, use reasonable endeavours to procure that on or as soon as practicable after Completion, as from Completion:

 

(a)       the Company is released from the guarantees and indemnities given by it in respect of obligations of any Company Subsidiary, including but not limited to the guarantees listed in Schedule 4 (Guarantees) and, pending such release, Buyer shall indemnify the Company against all Liabilities under those guarantees and indemnities; and

 

(b)       the Company is released from any claims, Liabilities (whether contingent or not), contracts, commitments or arrangements with any Company Subsidiary, and Buyer shall indemnify the Company against all Liabilities the Company may incur in respect thereof.

 

Section 8.2      Set-Off.  Any payment obligations under this ‎Article 8 shall, to the extent possible, be discharged by way of set-off (verrekening) and shall be made in accordance with ‎Article 21.

 

Article 9

Transfer of Any Other Assets and Liabilities

 

Section 9.1      Transfer of Assets and Liabilities.  The Company shall assign and/or transfer (as the case may be) to Buyer at Completion, and Buyer shall accept or assume (as the case may be) at Completion, all other Assets, properties, Liabilities, obligations and Contracts related to the Business (including the Company’s Liabilities, if any, under the Indemnification Agreements) in accordance with applicable requirements under applicable Laws.

 

Section 9.2      Consent to Certain Assignments.

 

(a)       Notwithstanding anything in this Agreement to the contrary, this Agreement shall not constitute an agreement to transfer, assign or sublease any Asset if an

 

 7 

 

 

attempted assignment thereof, without the consent of a third party, would constitute a breach or other contravention under any Contract or Law to which the Company or any of its Subsidiaries is a party or by which it is bound, or in any way adversely affect the rights of the Company or the Company Subsidiaries or, upon transfer, Buyer under such Asset. The Company and Buyer shall (acting together to the extent legally permissible) use their respective reasonable best efforts to obtain any consents or waivers required to assign to Buyer any Contract that requires the consent of a third party, without any conditions to such transfer or changes or modifications of terms thereunder. Buyer agrees that the Company and the Company Subsidiaries shall not have any liability to Buyer arising out of or relating to the failure to obtain any such consent that may be required in connection with the transactions contemplated by this Agreement or because of any circumstances resulting therefrom.

 

(b)       If any such consent is not obtained prior to Completion and as a result thereof Buyer may be prevented by the relevant third party from receiving the Asset intended to be transferred hereunder, or if any attempted transfer, assignment or sublease would adversely affect the rights of the Company or any of the Company Subsidiaries thereunder so that Buyer would not in fact receive all such rights or the Company or any of the Company Subsidiaries would forfeit or otherwise lose the benefit of rights that the Company or any of the Company Subsidiaries is entitled to retain, the Company and Buyer shall cooperate in any lawful and commercially reasonable arrangement, as the Company and Buyer shall agree, under which Buyer would, to the extent practicable, obtain the economic claims, rights and benefits of such Asset as applicable, and assume the economic burdens and obligations with respect thereto in accordance with this Agreement, including by subcontracting, sublicensing or subleasing to Buyer. The Company and the Company Subsidiaries shall promptly pay to Buyer when received all monies received by the Company and the Company Subsidiaries under any such Assets with respect to the period after Completion, and Buyer shall indemnify and promptly pay the Company or the relevant Indemnified Party, as the case may be, for all Liabilities of the Company and the Company Subsidiaries associated with such Assets with respect to the period after Completion.

 

Article 10

Wrong Box Assets

 

From time to time, the Parties shall review the composition of any Assets and Liabilities that remain with the Company (other than the Excluded Assets and Liabilities) with a view to transfer any such Asset or Liability (the “Wrong Box Assets”) to Buyer or a member of Buyer’s Group. So far as permitted by Law and subject to the receipt of all relevant regulatory approvals, any such Wrong Box Asset shall be promptly transferred for no further consideration to such member of Buyer’s Group as Buyer may specify and shall be managed for (beheerd worden voor) Buyer pending such transfer.

 

 8 

 

 

Article 11

Amounts Received in Error

 

All amounts received by the Company after Completion in respect of the Business and which are not otherwise transferred to Buyer pursuant to this Agreement shall be paid by the Company to Buyer in accordance with ‎Article 21 as soon as possible after they are received by the Company.

 

Article 12

Company’s Warranties

 

Section 12.1    The Company represents and warrants (garandeert) to Buyer that, on the date hereof and at Completion each of the following statements is true and accurate:

 

(a)       it has the requisite power and authority to enter into and perform this Agreement;

 

(b)       subject to the Completion Conditions being satisfied in accordance with ‎Article 4, it has the right to sell and on Completion will have the right to transfer or assign (as the case may be) to Buyer full legal title to and beneficial interest (volledig economisch en juridische eigendom) in the Business on the terms and conditions set out in this Agreement;

 

(c)       its obligations under this Agreement constitute binding obligations in accordance with its terms; and

 

(d)       the execution and delivery of, and the performance by it of its obligations under, this Agreement:

 

(i)       will not result in a material breach of any provision of its articles of association; and

 

(ii)       will not result in a breach of any order, judgment or decree of any court or Governmental Authority to which it is a party or by which it is bound.

 

The representations and warranties of the Company set forth herein shall continue until Completion, and shall terminate and be of no further force or effect immediately thereafter.

 

Article 13

Buyer’s Warranties

 

Buyer represents and warrants (garandeert) to the Company that, on the date hereof and at Completion each of the following statements is true and accurate:

 

(a)       it has the requisite power and authority to enter into and perform this Agreement;

 

 9 

 

 

(b)       its obligations under this Agreement constitute binding obligations in accordance with its terms;

 

(c)       the execution and delivery of, and the performance by it of its obligations under, this Agreement:

 

(i)       will not result in a material breach of any provision of its constitutional documents; and

 

(ii)       will not result in a breach of any order, judgment or decree of any court or Governmental Authority to which it is a party or by which it is bound; and

 

(d)       At Completion, Buyer will have available to it all funds necessary to pay the Cash Purchase Amount minus the amount of the Net Cash Deduction and to satisfy all of Buyer’s obligations under this Agreement.

 

Article 14

Breaches

 

Section 14.1    Without prejudice to the provisions of ‎Article 12 relating to the limited survival of the Company’s Warranties hereunder, each Party undertakes to remedy any Breach by it which is capable of being remedied as soon as commercially reasonably possible following receipt of a written request with respect thereto by the other Party. In the situation described in the preceding sentence, the breaching Party shall not be required to pay to the other Party any damages, Liabilities, losses and costs incurred by that Party or any member of its Group as a result of a Breach, unless the breaching Party fails to perform its obligation to remedy such Breach in accordance with such sentence.

 

Section 14.2    The obligations of the Company under this ‎Article 14 shall in no way reduce the Second Step Distribution.

 

Article 15

Buyer’s Indemnities

 

Section 15.1    Subject to the occurrence of Completion, Buyer hereby fully indemnifies, defends and holds harmless the Company against any present and future, actual or contingent, ascertained or unascertained or disputed, or other damages, Liabilities, obligations, losses, costs (including reasonable adviser fees) and fines (collectively “Losses”) arising, accruing or (to be) incurred by the Company arising directly or indirectly from the Transaction, including the Liquidation and/or Second Step Distribution, if applicable, and/or the Business (to the extent not already covered by a specific indemnity set out in this Agreement) and the Excluded Assets and Liabilities and any acts or omissions in connection with preparing, proposing or implementing the Transaction. Any Losses consisting of or in relation to Taxes shall be treated exclusively in accordance with Schedule 2 (Tax Matters).

 

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Section 15.2    Buyer hereby undertakes to indemnify and hold harmless by way of irrevocable third party stipulation for no consideration (onherroepelijk derdenbeding om niet), (i) the Liquidator and (ii) the current and future managing directors of the Liquidator (the persons under (i) and (ii), an “Indemnified Party”) against Losses arising, accruing or incurred by the persons under (i) or (ii) in that capacity arising directly from the Transaction or in relation to the Business, in each case:

 

(a)       excluding any Losses arising, accruing or incurred as a result of fraud (bedrog), willful misconduct (opzet) or gross negligence (grove schuld) by the Indemnified Parties, as finally established by a court decision or settlement agreement;

 

(b)       except to the extent covered by insurance and actually paid out pursuant to any insurance taken out for the benefit of the Indemnified Parties;

 

(c)       provided that Buyer will have sole control over any litigation relating to any Losses for which the Indemnified Party is seeking to be indemnified hereunder, including over any correspondence, negotiations and other communications with third parties that could potentially result in litigation, and provided that such person will not take any action that may prejudice or affect the position in litigation without Buyer’s prior written consent.

 

Section 15.3    Any Losses consisting of or in relation to Taxes shall be treated exclusively in accordance with Schedule 2 (Tax Matters).

 

Article 16

Third Party Claims

 

If a third party initiates a claim against the Company or an Indemnified Party, issues attachments (beslag) on Assets of the Company or otherwise takes actions against the Company or an Indemnified Party in respect of any claim which Buyer assumed or against which Buyer has agreed to indemnify the Company or an Indemnified Party hereunder, then Buyer will as from Completion assume the defense of and liability in respect of such claim and exclusively be responsible for the conduct of any appeal, dispute, compromise or defense of such claim, and at the first request of the Company or an Indemnified Party, procure as soon as possible that any such claims are withdrawn against the Company or an Indemnified Party, the attachment is lifted or the other actions are terminated, if reasonably necessary, by offering to provide adequate security referred to in Article 6:51 of the DCC and guarantees, whether by depositing cash or entering into other arrangements, provided the kind or type of security to be provided shall be at the reasonable discretion of Buyer.

 

Article 17

Covenants

 

Section 17.1    The Company covenants with Buyer that:

 

(a)       it will execute and do, or use its commercially reasonable efforts to procure to be executed and done by any other relevant party, as the case may be, all such deeds,

 

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documents, acts and things as Buyer may from time to time require in order to transfer the Business and/or any individual Asset and/or Contract to Buyer, or as otherwise may be necessary to give full effect to this Agreement; and

 

(b)       it will use its commercially reasonable efforts to procure the convening of all meetings, the giving of all waivers and consents and the passing of all resolutions as may be necessary to give effect to this Agreement.

 

Section 17.2    Buyer covenants with the Company that:

 

(a)       it shall retain for a period ending on the seventh anniversary of the Liquidation End Date, all books, records and other written information relating to the Business and, to the extent reasonably required by the Company or the members of the Company Board or, if applicable, the Liquidator, shall allow the Company, the Liquidator and their respective employees, representatives and advisers, as well as the present and former members of the Company Board, upon reasonable written notice, reasonable access during normal office hours to such books, records and other information, including the right to inspect and take copies to the extent required to satisfy bona fide legal obligations;

 

(b)       at Completion, it shall arrange for the steps and/or transactions or series of transactions specified by ‎Article 18 and Schedule 1 to result in the payment of the Second Step Distribution into the Settlement Agent Account for the benefit of the then-existing Minority Shareholders.

 

Article 18

Liquidation

 

Section 18.1    Subject to Completion, the Company shall procure that the Liquidator shall at Completion resolve and arrange for, in accordance with Schedule 1 (Completion), the payment into the Settlement Agent Account for the benefit of the Minority Shareholders of an advance liquidation distribution within the meaning of Article 2:23b(6) of the DCC, which will ultimately result in payment to the Minority Shareholders of an amount per Share equal to the Offer Consideration payable in cash to the Minority Shareholders, consisting of the Cash Purchase Amount as provided for in Section ‎3.2 and ‎Section 3.6, subject to ‎Section 18.2; with such payment into the Settlement Agent Account to be made prior to the Liquidator filing a final accounting (rekening en verantwoording) and plan of distribution (plan van verdeling) with the Trade Register in accordance with Article 2:23b(4) of the DCC (such advance liquidation distribution: the “Second Step Distribution”). That portion of the Liquidation entitlement that would otherwise be payable to the Buyer in its capacity of shareholder of the Company will be satisfied by way of setoff against the obligation of the Buyer to pay for the value of the Business, as more fully set forth in ‎Section 3.1.

 

Section 18.2    To the extent that the Second Step Distribution is subject to withholding or similar Taxes, the Company shall withhold the required amounts from the Second Step Distribution and remit such amounts as required by the relevant Tax Laws. The Parties acknowledge that banks may charge administrative costs to Shareholders in relation to the

 

 12 

 

 

transfer of the Second Step Distribution to their accounts by the Settlement Agent or otherwise, for which no compensation shall be paid to such Shareholders.

 

Section 18.3    Subject to Completion, the Liquidator shall also, as promptly as practicable following the Second Step Distribution and delisting of the Company, with the assistance of Buyer, wind up the Company’s affairs, satisfy (using funds to be supplied by Buyer) all valid claims of creditors and others having claims against the Company and effectuate the Liquidation, all in full compliance with applicable Laws.

 

Section 18.4    Subject to the occurrence of Completion, and in connection with the Liquidation (which will become effective on the date of Completion), Buyer shall (i) assist the Company and the Liquidator to effect the Liquidation and take all actions reasonably requested by the Company for such purpose, including by granting the Company and the Liquidator reasonable access to the Business and providing such other assistance as the Company or the Liquidator may reasonably request, (ii) assist the Liquidator and the Company to expeditiously effect the Second Step Distribution to be resolved, and paid into the Settlement Agent Account for the benefit of the Minority Shareholders, on the date of Completion and prior to the commencement of the opposition period related to the Liquidation, (iii) pay or discharge all outstanding debts, liabilities and claims that are assumed by Buyer under this Agreement, (iv) give, to the extent reasonably possible, certain statements and explanations to the Liquidator regarding (inter alia) Buyer’s financial position and Buyer’s obligations vis-à-vis the Company after Completion and (v) assist the Company and the Liquidator with any other reasonable requests and requirements. In addition, Buyer shall from time to time provide reasonably required comfort to the Liquidator on Buyer’s financial position.

 

Section 18.5    The Liquidator agrees with and acknowledges the steps and actions set out in this ‎Article 18 and shall co-sign this Agreement in evidence thereof.

 

Section 18.6    In addition to, and without limitation of, the other indemnities and covenants of Buyer contained in this Agreement, Buyer will do any such things as reasonably necessary or appropriate, if any, to procure that neither the Company, nor the Liquidator (or any Person subsequently appointed as a liquidator of the Company) has any grounds to demand any refund or (re)payment of any part of the Second Step Distribution on any grounds whatsoever from the Minority Shareholders.

 

Article 19

Cost Arrangement and Reimbursement

 

Subject to Completion, Buyer shall pay all reasonable out-of-pocket costs and expenses for external legal advisers incurred by the Company, the Independent Directors and the Liquidator after consummation of the Offer and until completion of the Liquidation in connection with (i) the preparation, entering into and completion of the Liquidation including fees and expenses of the Liquidator and (ii) any and all legal proceedings against the Company, the Independent Directors and the Indemnified Parties relating to the structure and/or other terms and conditions and/or consummation of the Transaction (the “Liquidation Costs and Liabilities”). The Company Board or, if applicable, the Liquidator, or one or more of the Independent

 

 13 

 

 

Directors, may ask Buyer for one or more reasonable advance payments for such Liquidation Costs and Liabilities, which Buyer shall provide following such request. The Company Board or, if applicable, the Liquidator, shall account for the Liquidation Costs and Liabilities applicable to them. The provisions of this ‎Article 19 constitute an irrevocable third party stipulation (onherroepelijk derdenbeding om niet) in favor of the Company, the Liquidator, the Indemnified Parties and the Independent Directors.

 

Article 20

Confidentiality

 

Section 20.1    Until Completion, each of the Parties shall, and shall cause its Subsidiaries to, keep confidential all information provided to it by or on behalf of the other Party (or its Affiliates) which relates to the other Party (or its Affiliates) and the Transaction in accordance with the terms of the Confidentiality Agreement.

 

Section 20.2    If after Completion the Company holds confidential information relating to the Business, the Company shall keep that information confidential and, to the extent reasonably practicable, shall return that information to Buyer or destroy it, in each case without retaining copies.

 

Article 21

Payments

 

Section 21.1    Unless otherwise agreed, any payments to be made under this Agreement or any related documents shall be made in USD by transfer of the relevant amount to the relevant account on or before the date the payment is due. The relevant account for a given payment is:

 

(a)       for any payment to be made to the Company:

 

bank: [name and address]
sort code: [●]
IBAN: [●]
account name: [●]

 

or such other account as the Company shall, not less than three (3) Business Days before the date on which payment is due, have specified by giving notice to Buyer;

 

(b)       for the payment of the Cash Purchase Amount, the Settlement Agent Account having the following details:
[DETAILS TO COME]

 

(c)       for any payment to be made to Buyer:

 

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bank: [name and address]
sort code: [●]
IBAN: [●]
account name: [●]

 

or such other account as Buyer shall, not less than three (3) Business Days before the date on which payment is due, have specified by giving notice to the Company.

 

Section 21.2    Save as otherwise specifically set out in this Agreement, if a Party defaults in making any payment when due of any sum payable under this Agreement, it shall pay interest on that sum from (and including) the date on which payment is due until (but excluding) the date of actual payment (after as well as before judgment) at the Dutch statutory interest rate.

 

Article 22

Termination

 

This Agreement may be terminated only by the written agreement of Buyer and the Company (including the Independent Directors). In the event of termination of this Agreement, this Agreement shall have no further effect with the exception of this ‎Article 22 and ‎Article 20 and ‎Article 23, which provisions shall survive any termination of this Agreement. In such event, there shall be no liability on the part of any Party, except that termination of this Agreement shall not relieve either Party from any liability for any willful and material breach of its representations or warranties set forth in this Agreement or any breach of its obligations or agreements set forth in this Agreement.

 

Article 23

Miscellaneous

 

Section 23.1    Notices.  All notices, consents, requests, claims, demands and other communications under this Agreement shall be in writing and shall be deemed given (a) on the date of delivery if delivered personally or sent via electronic mail, (b) on the first (1st) Business Day following the date of dispatch if sent by a nationally recognized overnight courier (providing proof of delivery) or (c) on the tenth (10th) Business Day following the date of mailing if delivered by registered or certified mail, return receipt requested, postage prepaid, in each case to the Parties at the following addresses (or at such other address for a Party as shall be specified by like notice):

 

if to Buyer, to:

 

Intel Corporation
2200 Mission College Boulevard
Santa Clara, CA 95054
Attention: Steve Rodgers
  General Counsel
Email: Steve.R.Rodgers@intel.com

 

 15 

 

 

with a copy to:

 

Intel Corporation
2200 Mission College Boulevard
Santa Clara, CA 95054
Attention: Susie Giordano
  Vice President, Law and Policy Group
  Managing Director, Intel Capital and Mergers and
  Acquisitions Legal
Email: Susie.Giordano@intel.com

 

with copies, which shall not constitute notice, to:

 

Skadden, Arps, Slate, Meagher & Flom LLP
525 University Avenue
Palo Alto, CA  94301
United States of America
Attention: Kenton J. King
Email: Kenton.King@skadden.com

 

and
 
Houthoff Buruma
Gustav Mahlerplein 50
1082 MA Amsterdam
The Netherlands
Attention: Alexander J. Kaarls
Email: A.Kaarls@houthoff.com
   
and
 
Yigal Arnon & Co.
1 Azrieli Center
Round Building
Tel Aviv 6702101
Israel
Attention: Barak S. Platt
Email: BarakP@arnon.co.il

 

if to the Company, to:

 

Mobileye Vision Technologies Ltd.
13 Hartom St.
Jerusalem 9777513
Israel
Attention: Legal Department
Email: legal@mobileye.com

 

 16 

 

 

with a copy (which shall be required in order to constitute notice to the Company) to each of the Independent Directors for so long as they continue to serve on the Company Board, at their last known addresses as set forth in the records of the Company, or such subsequent addresses as they shall notify to Buyer in the manner specified in this ‎Section 23.1;

 

and with copies, which shall not constitute notice, to:

 

Morrison & Foerster LLP
250 West 55th Street
New York, NY  10019
Attention: James R. Tanenbaum
Email: JTanenbaum@mofo.com
   
and
 
Van Campen Liem
J.J. Viottastraat 52
1071 JT Amsterdam
The Netherlands
Attention: Thomas W. Mitchell
Email: Tom.Mitchell@vancampenliem.com
   
and
 
Goldfarb Seligman & Co.
Ampa Tower
98 Yigal Alon Street
Tel Aviv 6789141
Israel
Attention: Aaron M. Lampert
Email: Aaron.Lampert@goldfarb.com

 

Section 23.2    Further Assurances.  If at any time either of the Parties reasonably believes that any further instruments, deeds, bills of sale, assignments or assurances are reasonably necessary or desirable to consummate the transactions contemplated by this Agreement or to carry out the purposes and intent of this Agreement, then, subject to the terms and conditions of this Agreement, the Company and Buyer shall execute and deliver all such proper deeds, powers of attorney, assignments, instruments and assurances and do all other things reasonably necessary or desirable to consummate the transactions contemplated by this Agreement and to carry out the purposes and intent of this Agreement.

 

Section 23.3    Assignment.

 

(a)       Buyer shall be entitled to nominate one or more members of Buyer’s Group to purchase all of the Business or different parts thereof, and Buyer shall be entitled to transfer and assign any or all of its rights and obligations under this Agreement to any such member of Buyer’s Group and the other parties hereto hereby consent in advance to such transfer

 

 17 

 

 

and assignment. Such nomination, transfer or assignment must be made in writing to the Company and can be made at any time up to two (2) Business Days prior to Completion. Upon such nomination, transfer or assignment, the Parties shall procure that any such person shall become a party to this Agreement by entering into the Deed of Adherence in the form as set out in Schedule 5 hereto (Deed of Adherence) and thereafter such Person shall be deemed to be a Buyer for the purpose of this Agreement. Buyer shall remain jointly and severally liable with the designated assignee, or assignees as the case may be, for the proper performance of any obligations assigned to the designated assignee under this ‎Section 23.3(a).

 

(b)       Save for the assignment in accordance with ‎Section 23.3(a), neither Party may assign any of its rights or transfer any of the obligations under this Agreement or any interest therein (including by means of statutory merger or demerger), without the prior written consent of the other Party.

 

Section 23.4    Non-Survival of Representations and Warranties; Survival of Certain Covenants and Agreements. The representations and warranties of the Company contained in this Agreement and in any certificate or other writing delivered pursuant to this Agreement shall not survive Completion. This ‎Section 23.4 shall not limit any covenant or agreement of the Parties that by its terms contemplates performance after Completion or the termination of this Agreement.

 

Section 23.5    Expenses. Except as otherwise expressly provided in this Agreement (including ‎Article 19), all direct and indirect costs and expenses incurred in connection with this Agreement shall be borne by the party incurring such expenses.

 

Section 23.6    Counterparts. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Any such counterpart, to the extent delivered by Electronic Delivery, will be treated in all manner and respects as an original executed counterpart and will be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. No Party may raise the use of an Electronic Delivery to deliver a signature, or the fact that any signature or agreement or instrument was transmitted or communicated through the use of an Electronic Delivery, as a defense to the formation of a contract, and each Party hereto forever waives any such defense, except to the extent that such defense relates to lack of authenticity. This Agreement shall become effective when each Party hereto shall have received a counterpart of this Agreement signed by each of the other Parties hereto. Until and unless each Party hereto has received a counterpart of this Agreement signed by each of the other Parties hereto, this Agreement shall have no effect and no Party hereto shall have any right or obligation hereunder (whether by virtue of any other oral or written agreement or other communication).

 

Section 23.7    Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other Governmental Authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated, so long as the economic or legal substance of the transactions contemplated by this Agreement is not affected in any material way. Upon such a determination, the Parties shall

 

 18 

 

 

negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner in order that the transactions contemplated by this Agreement be consummated as originally contemplated to the fullest extent possible.

 

Section 23.8    Rights.  The rights of each Party under this Agreement (a) may be exercised as often as necessary and (b) are, unless this Agreement provides otherwise, cumulative and not exclusive of rights and remedies provided by Law.

 

Section 23.9    Certain DCC Matters.

 

(a)       Neither the Company nor Buyer shall be entitled to call upon or derive any rights under Title 1 Book 7 of the DCC.

 

(b)       The Parties waive their right under Articles 6:265 to 6:272 inclusive, 6:228, 6:230 and 6:258 of the DCC to rescind (ontbinden), nullify (vernietigen), make amendment proposals (wijzigingsvoorstellen) regarding this Agreement on the ground of error, or demand in legal proceedings the rescission (ontbinding), nullification (vernietiging) or the amendment of this Agreement.

 

(c)       The Convention on the International Sale of Goods shall not be applicable to the transactions contemplated by this Agreement.

 

Section 23.10    Entire Agreement.  This Agreement, including the Schedules hereto, taken together with any other documents delivered in connection with this Agreement, constitutes the entire agreement, and supersedes all prior agreements and understandings, both written and oral, among the Parties with respect to the subject matter hereof and thereof (except for the Purchase Agreement). Except as otherwise expressly set forth herein, this Agreement is not intended to confer upon any Person other than the Parties hereto any rights or remedies.

 

Section 23.11  Amendments and Waivers.

 

(a)       This Agreement may only be amended or supplemented at any time by additional written agreements signed by, or on behalf of, Buyer and the Company (including the Independent Directors if they are still serving on the Company Board), as may mutually be determined by the Parties as aforesaid to be necessary, desirable or expedient to further the purpose of this Agreement or to clarify the intention of the Parties.

 

(b)       No provision of this Agreement may be waived or extended except by a written instrument signed by the Party against whom the waiver or extension is to be effective (including, in the case of a waiver or extension by the Company, the Independent Directors if they are still serving on the Company Board). No failure or delay on the part of any Party in the exercise of any right hereunder shall impair such right or be construed to be a waiver of, or acquiescence in, any breach of any representation, warranty or agreement in this Agreement, nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or of any other right.

 

Section 23.12  Specific Performance and Other Remedies.  The Parties agree that irreparable damage, for which monetary damages, even if available, would not be an adequate

 

 19 

 

 

remedy, will occur in the event that the Parties do not perform their obligations under the provisions of this Agreement in accordance with its specified terms or otherwise breach such provisions. Subject to the following sentence, the Parties acknowledge and agree that (a) the Parties shall be entitled to an injunction or injunctions, specific performance, or other equitable relief, to prevent breaches or threatened breaches of this Agreement and to enforce specifically the terms and provisions hereof in the Dutch Chosen Courts without proof of damages or otherwise, this being in addition to any other remedy to which they are entitled under this Agreement and (b) the right of specific performance is an integral part of the transactions contemplated by this Agreement and without that right, none of the Parties would have entered into this Agreement. The Parties acknowledge and agree that any Party seeking an injunction or injunctions to prevent breaches or threatened breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in accordance with this ‎Section 23.12 shall not be required to provide any bond or other security in connection with any such Order or injunction. Without limiting the generality of the foregoing, the Independent Directors shall be entitled to seek specific performance of this Agreement on behalf of the Company against Buyer.

 

Section 23.13  Governing Law.

 

(a)     This Agreement, and any Action arising out of or relating to this Agreement or the transactions contemplated by this Agreement, shall be governed by, and construed in accordance with, the Laws of the Netherlands, without regard to choice or conflict of Law principles thereof.

 

(b)       To the extent legally feasible, any power of attorney or other document executed in connection with this Agreement or the Transaction shall be governed by and construed exclusively in accordance with the Laws of the Netherlands.

 

Section 23.14    Jurisdiction; Forum.  Each party (i) irrevocably and unconditionally submits to the personal jurisdiction of the courts of Amsterdam, the Netherlands and any appellate court therefrom (the “Dutch Chosen Courts”), (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such Dutch Chosen Court, (iii) agrees that any Actions arising in connection with or relating to this Agreement or the transactions contemplated by this Agreement shall be brought, tried and determined only in the Dutch Chosen Courts, (iv) waives any claim of improper venue or any claim that the Dutch Chosen Courts are an inconvenient forum and (v) agrees that it will not bring any Action relating to this Agreement or the transactions contemplated by this Agreement in any court other than the Dutch Chosen Courts. Each of the Parties hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any action or proceeding arising out of or relating to this Agreement or the transactions contemplated by this Agreement: (A) any claim that such party is not personally subject to the jurisdiction of the Dutch Chosen Courts as described herein for any reason; (B) that it or its property is exempt or immune from jurisdiction of any such Dutch Chosen Court or from any legal process commenced in such courts (whether through service of process, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise); and (C) that (1) the Action in any such court is brought in an inconvenient forum, (2) the venue of such Action is improper or (3) this Agreement, or the subject matter hereof, may not be enforced in or by such Dutch Chosen Courts.

 

 20 

 

 

Section 23.15  Language.  The language of this Agreement and the Transaction is English and all notices, demands, requests, statements, certificates or other documents or communications shall be in English unless otherwise agreed.

 

Section 23.16  Interpretation.  Unless the express context otherwise requires: (i) the words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (ii) terms defined in the singular shall have a comparable meaning when used in the plural, and vice versa; (iii) references herein (whether capitalized or not) to a specific Section, Subsection, Recital, Schedule, Exhibit or Annex shall refer, respectively, to Sections, Subsections, Recitals, Schedules, Exhibits or Annexes of or to this Agreement; (iv) wherever the word “include,” “includes” or “including” is used in this Agreement, it shall be deemed to be followed by the words “without limitation”; (v) references herein to any gender shall include each other gender; (vi) with respect to the determination of any period of time, the word “from” means “from and including” and the words “to” and “until” each means “to but excluding”; (vii) the word “or” shall be disjunctive but not exclusive; (viii) references herein to any Law shall be deemed to refer to such Law as amended, modified, codified, reenacted, supplemented or superseded in whole or in part and in effect from time to time, and also to all rules and regulations promulgated thereunder; (ix) the headings contained in this Agreement are intended solely for convenience and shall not affect the rights of the parties to this Agreement; (x) if the last day for the giving of any notice or the performance of any action required or permitted under this Agreement is a day that is not a Business Day, then the time for the giving of such notice or the performance of such action, unless otherwise required by Law, shall be extended to the next succeeding Business Day; and (xi) references herein to “as of the date hereof,” “as of the date of this Agreement” or words of similar import shall be deemed to mean “as of immediately prior to the execution and delivery of this Agreement.”

 

Section 23.17  Rules of Construction. The Parties have participated jointly in negotiating and drafting this Agreement. If an ambiguity or a question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.

 

 21 

 

 

SIGNATORIES

 

This Agreement has been signed by the Parties (or their duly authorised representatives) on the date stated at the beginning of this Agreement.

 

  SIGNED by: )
     
     
  For and on behalf of )
  Mobileye N.V. )
     
  SIGNED by: )
     
     
  For and on behalf of )
  Cyclops Holdings, LLC )

 

 

 

 

  Signed in acknowledgment and agreement of ‎Article 18:  
     
  SIGNED by:  
     
     
  For and on behalf of  
  Stichting Vereffening Mobileye,  
  the Liquidator  

 

 

 

 

Schedule 1

Completion

 

1.The Company shall give Buyer possession of those Assets which are transferable by delivery with the intention that title to those Assets should pass to Buyer by such delivery.

 

2.The Company shall procure the transfer to Buyer of all (other) Assets and liabilities (to the extent any such assets and liabilities can be so transferred) used in connection with the Business as at Completion, including:

 

(a)assigning to Buyer all Contracts and all other contracts entered into by the Company in the period up to Completion; and

 

(b)transferring the shares of the Company Subsidiaries to Buyer as follows:

 

(i)in the case of the shares of the Israeli Subsidiary, by execution of a share transfer deed in customary form between the Company and Buyer pursuant to which the Company transfers all of the shares of the Israeli Subsidiary to Buyer;

 

(ii)in the case of the shares of the U.S. Subsidiary, by delivering to Buyer the certificates representing the shares of the U.S. Subsidiary, duly endorsed by the Company in favor of Buyer, or accompanied by stock powers in blank in favor of Buyer, duly executed by the Company;

 

(iii)in the case of the shares of the German Subsidiary, by execution of a share transfer deed before a notary in customary form between the Company and Buyer pursuant to which the Company transfers all of the shares of the German Subsidiary to Buyer;

 

(iv)in the case of the shares of the Japanese Subsidiary, by execution of a share transfer agreement in customary form between the Company and Buyer pursuant to which the Company transfers all of the shares of the Japanese Subsidiary to Buyer and causes the Japanese Subsidiary to update its shareholders list to duly reflect such share transfer;

 

(v)in the case of the shares of the Chinese Subsidiary, by (A) execution of an equity transfer agreement in customary form between the Company and Buyer pursuant to which the Company transfers all of the equity interests of the Chinese Subsidiary to Buyer and (B) completion of change of registration at the local counterpart of the State Administration of Industry and Commerce, followed with filing with the local counterpart of the Ministry of Commerce within 30 days after Completion; and

 

(vi)in the case of the shares of the Cyprus Subsidiary, by [●].

 

 24 

 

 

3.The Company shall procure that all Information is made available to Buyer.

 

4.(a)Buyer shall pay the Cash Purchase Amount minus the Net Cash Deduction into the Settlement Agent Account. The Company shall pay into the Settlement Agent Account the amount of the Net Cash Deduction. The Settlement Agent shall receive and hold the amounts received by it pursuant to the two preceding sentences (x) initially, following receipt, on behalf of the respective payors thereof, (y) upon completion of the actions described in paragraphs 1 through 3 above, on behalf of the Company and then (z) upon completion of the actions described in paragraph 4(d)(A) below, on behalf of the Minority Shareholders.

 

(b)The Settlement Agent shall confirm that it has received in the Settlement Agent Account pursuant to paragraph (a) an amount equal to the Cash Purchase Amount.

 

(c)The Company shall transfer the Company Excess Cash at Completion (if any) to Buyer.

 

(d)(A) Upon completion of the steps set out under paragraphs 1 through 4(c) the Company and Buyer shall, on the date of Completion, confirm the completion of such steps, and, on the date of Completion, the actions specified in paragraphs (i) and (ii) below shall be taken:

 

(i)the resolution of the Company’s general meeting to dissolve (ontbinden) the Company and to appoint the Liquidator will become effective;

 

(ii)the Liquidator shall (A) file a notice of the proposed liquidation and dissolution of the Company in the registers where the Company is registered as required under Article 2:19(2) of the DCC (and for the period during which the Company continues to exist for the purposes of the liquidation of its property, proprietary rights and interests, procure that in all documents and announcements of the Company the words “in liquidatie” are added to the Company’s name in accordance with Article 2:19(5) of the DCC) and (B) resolve to make the Second Step Distribution; and

 

(B) As promptly as practicable after the date of Completion, the Liquidator shall procure that the Second Step Distribution is actually paid to the Minority Shareholders by causing the Settlement Agent to pay the Cash Purchase Amount to the Minority Shareholders in accordance with the terms of the [·] Agreement,1 dated [·], between Buyer, the Company and the Settlement Agent.

 

 

1 Note to Draft: Title of agreement to be confirmed.

 

 25 

 

 

5.After the Second Step Distribution has been made (and only after the Second Step Distribution is made), the Liquidator shall, as soon as practicable but in no event any earlier than the first Business Day following the date of Completion, (A) file with the Trade Register the final accounting (rekening en verantwoording), and plan of distribution (plan van verdeling), with respect to the Liquidation, each of which shall in all respects be consistent with the provisions of this Agreement and (B) make the public announcement of such filing in a Dutch daily newspaper in accordance with Section 2:23b of the DCC.

 

 26 

 

 

Schedule 2

Tax Matters

 

1.INTERPRETATION

 

1.1In this Schedule, unless such words or expressions are defined in this Schedule or the contrary intention otherwise appears, words and expressions defined elsewhere in this Agreement have the same meaning and:

 

Actual Tax Liability” means a liability to make or suffer an actual payment of Tax to a Tax Authority;

 

Company’s Tax Affairs” means the Tax affairs of the Company;

 

Pre-Completion Tax Affairs” means the Tax affairs of the Company Subsidiaries for any period ending prior to or on Completion or starting prior to Completion, but ending after Completion;

 

Relevant Tax Affairs” means the Pre-Completion Tax Affairs and the Company’s Tax Affairs;

 

Relevant Tax Returns” means the Tax returns of the Company and the Company Subsidiaries which have not been filed or agreed with the relevant Tax Authority in relation to the Relevant Tax Affairs;

 

Tax Claim” means any notice issued by a Tax Authority from which it appears that the addressee of such notice may be required to make an actual, or suffer a deemed, payment of Taxation or may suffer the non-availability, loss, reduction or cancellation of a relief; and

 

Tax Return” means any correspondence, notice, claim, return, declaration, report and computation relating to Tax.

 

1.2In this Schedule, unless the contrary intention appears, a reference to a paragraph or subparagraph is to a paragraph or subparagraph of this Schedule and a reference to a Clause or subclause is to a clause or subclause of this Agreement.

 

2.BUYER’S TAX INDEMNITY

 

2.1Subject to Completion having occurred, Buyer hereby undertakes to indemnify and hold harmless the Company against any Losses consisting of or in relation to Tax incurred, including any Actual Tax Liability due, in respect of the Transaction and/or in relation to the Business, but excluding any withholding Tax in respect of the Second Step Distribution that is made to the Minority Shareholders.

 

2.2Subject to Completion having occurred and by way of irrevocable third party stipulation for no consideration (onherroepelijk derdenbeding om niet), Buyer hereby undertakes to indemnify and hold harmless the Minority Shareholders and each Indemnified Party

 

 27 

 

 

against any Actual Tax Liability in respect of the Transaction and/or in relation to the Business, in each case excluding:

 

(a)any withholding Tax in respect of the Second Step Distribution that is made to Minority Shareholders;

 

(b)any Tax levied by reference to income, profits or gains or any other similar Taxes (“Income Tax”), other than Income Tax of the Company in respect of which the Pre-Wired Asset Sale Ruling has been obtained; and

 

(c)any Losses arising, accruing or incurred as a result of fraud, willful misconduct or gross negligence of the relevant indemnified Person, as set forth above, as finally established by a court decision or settlement agreement.

 

2.3In the event any Tax or Losses in relation to Tax would be due as described in subparagraph ‎2.1 or subparagraph ‎2.2, the payment by Buyer shall be increased to an amount which (after deduction of such Tax and taking into account any related Tax relief) leaves the Company, the Minority Shareholders or the Indemnified Party (as applicable) in the same position as if no Tax had been due. No payment is due under this subparagraph to the extent the Company, the Minority Shareholders or the relevant Indemnified Party (as applicable) have been paid under another provision of the Agreement for the same liability.

 

2.4A payment to be made by Buyer under this Schedule 2 (Tax Matters), if any, shall be made ultimately on the date which is five (5) Business Days prior to the last date on which that payment of Tax may be made in order to avoid incurring a liability to interest or penalties.

 

3.CONDUCT OF TAX AFFAIRS

 

3.1Buyer shall after Completion have conduct of the Relevant Tax Affairs in the manner as set forth in this Schedule 2.

 

3.2With respect to the Relevant Tax Affairs the following applies after Completion:

 

(a)subject to the following provisions of this subparagraph ‎3.2, Buyer and its advisors shall prepare, submit, negotiate, and agree on behalf of the Company the Relevant Tax Returns;

 

(b)the Company and its advisors shall provide Buyer and its advisors on a timely basis with all relevant information, including but not limited to copies of all Relevant Tax Returns, correspondence and other documents submitted to the relevant Tax Authority in relation to Relevant Tax Returns (together with such other information as may be necessary to enable Buyer to consider the correspondence and other documents in light of all material facts) within sufficient time before any submission by Buyer to the relevant Tax Authority;

 

(c)all Relevant Tax Returns will be completed and submitted as Buyer (or its advisors) in its sole discretion will determine;

 

(d)the Company and the Company Subsidiaries shall make such claims and elections and give such consents (including such provisional or final claims) as Buyer (or its advisers) may request, including, without limitation, filing any election

 

 28 

 

 

requested by Buyer under U.S. Treasury Regulations Section 301.7701-3 with respect to the Company or any Company Subsidiary;

 

(e)the Company and its advisors shall keep Buyer informed about the status of any negotiations relating to the Relevant Tax Affairs of the Company and each Company Subsidiary and consult with Buyer on any matters relating to Relevant Tax Affairs which Buyer may specify in writing to the Company, including any requested retroactive election to a time period preceding Completion (to the extent permitted under applicable Law);

 

(f)the Company and the Company Subsidiaries shall not agree or settle any of the Relevant Tax Returns without the prior written consent by Buyer; and

 

(g)Buyer shall on behalf of the Company and the Company Subsidiaries agree all Relevant Tax Returns with the relevant Tax Authority as quickly as reasonably possible.

 

3.3Buyer shall after Completion prepare, negotiate and agree all Tax Returns of the Company Subsidiaries and the Company and its advisors will give Buyer all reasonable co-operation, access and assistance in relation thereto.

 

3.4From and after Completion:

 

(a)the Company shall retain and preserve its Tax records and relevant financial information but shall deliver copies of any such Tax records and relevant financial information in connection with the Transaction to Buyer as soon as reasonably practical. The Company shall permit Buyer and its advisors, on Buyer giving reasonable notice, access during normal office hours to them where reasonably required for Tax purposes;

 

(b)the Company shall ensure that the Tax records and relevant financial information of each Company Subsidiary shall be delivered to Buyer as soon as reasonably practical;

 

(c)Buyer shall, and shall procure that the Company Subsidiaries shall, retain for a period of seven (7) years from the Liquidation End Date, or such longer period as may be prescribed by applicable Laws, regulations, orders and statutes, all financial information and similar records relating to the Company Subsidiaries delivered to Buyer in connection with the consummation of the Transaction or held by the Company Subsidiaries; and

 

(d)Buyer shall provide the Company and the Liquidator, if applicable, and their respective advisors, with access (upon reasonable notice and at reasonable times during normal business hours) to such financial information and similar records relating to Relevant Tax Affairs where reasonably required for Taxation purposes.

 

 29 

 

 

4.CONDUCT OF TAX CLAIM

 

4.1If after Completion the Company receives any Tax Claim with respect to Relevant Tax Affairs, it shall notify Buyer and its advisors in writing as soon as reasonably practicable.

 

4.2Buyer and the relevant Company Subsidiary shall be free to pay or settle any Tax Claim referred to in subparagraph ‎4.1, in the name of the Company or as the case may be in the name of the relevant Company Subsidiary, on such terms as they may think fit.

 

4.3To the extent legally permitted, after Completion Buyer shall be entitled to resist any Tax Claim in relation to Relevant Tax Affairs, in the name of the Company or as the case may be the relevant Company Subsidiaries, and to have the conduct of any appeal, dispute, compromise or defense of such Tax Claim and of any incidental negotiations and the Company will give and procure the Company Subsidiaries to give Buyer all reasonable co-operation, access and assistance for the purposes of considering and resisting the relevant Tax Claim.

 

4.4If after Completion Buyer does not elect to resist a Tax Claim of the Company, the Company shall give Buyer drafts of all communications it intends to make in relation to such Tax Claim at least five (5) Business Days before the communication is made, shall make such amendments as Buyer shall request before it makes such communication, shall promptly provide Buyer with copies of all correspondence relating to the Tax Claim and shall neither agree nor settle the relevant Tax Claim without the prior written consent by Buyer.

 

5.GROUP TAX ARRANGEMENTS

 

5.1Any Tax sharing agreement or similar agreement between the Company and the Company Subsidiaries shall be terminated as of Completion. Subject to the termination, the Company agrees, and agrees to procure, that no Company Subsidiary shall have a liability after Completion to make a payment or repayment to any member of the Company’s Group in respect of group Tax arrangements, a consolidation or fiscal unity, or under any Tax sharing or Tax allocation arrangement.

 

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Schedule 3

Contracts

 

[NOTE: Schedule to be mutually agreed prior to the execution of the final Asset Sale Agreement.]

 

 31 

 

 

Schedule 4

Guarantees

 

If still existing at Completion, the guarantees under the following Contracts:

 

[NOTE: Schedule to be mutually agreed prior to the execution of the final Asset Sale Agreement.]

 

 32 

 

 

Schedule 5

Deed of Adherence

 

(the “Deed”)

 

THIS DEED is made on [●] by [name] of [address] (the “New Buyer”).

 

BACKGROUND

 

(A)This Deed is made pursuant to an agreement for the sale and purchase of the Business dated [●] between Mobileye N.V. (the “Company”) and Cyclops Holdings, LLC (the “Original Buyer”) (the “Agreement”).

 

(B)The New Buyer has been nominated by the Original Buyer under ‎Section 23.3 of the Agreement.

 

1.INTERPRETATION

 

Save as otherwise set out in this Deed, words and expressions defined in the Agreement have the same meaning in this Deed.

 

2.OPERATIVE PROVISIONS

 

2.1The New Buyer confirms it has been supplied with a copy of the Agreement.

 

2.2The New Buyer undertakes to be bound by the Agreement in all respects as if the New Buyer was a party to the Agreement and named in it as Buyer, and to observe and perform all the provisions and obligations of the Agreement applicable to or binding on Buyer under the Agreement insofar as they have not been performed on or after the date of this deed.

 

2.3This Deed is made for the benefit of (a) the Parties to the Agreement and (b) every other person who after the date of the Agreement (whether before or after the execution of this deed) assumes any rights or obligations under the Agreement or adheres to it.

 

2.4The address, fax number and e-mail of the New Buyer for the purposes of ‎Section 23.1 of the Agreement are:

 

Name: [●]
Address: [●]
Fax: [●]
E-mail: [●]
marked for the attention of: [●].

 

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2.5The account details of the New Buyer for the purpose of ‎Article 21 of the Agreement are:

 

bank: [name and address]
sort code: [●]
IBAN: [●]
account name: [●]

 

2.6This Deed is governed by and shall be construed in accordance with the laws of the Netherlands.

 

2.7The Parties irrevocably and unconditionally submit to the exclusive jurisdiction of the courts of Amsterdam, the Netherlands (subject to appeal as provided by law) over any suit, action or proceeding brought pursuant to or arising out of this Deed.

 

3.EXECUTION

 

This Deed has been signed on the date stated at the beginning of it.

     
  SIGNED by: )
  For and on behalf of )
  [New Buyer] )
     
  SIGNED by: )
  For and on behalf of )
  Mobileye N.V. )
     
  SIGNED by: )
  For and on behalf of )
  Cyclops Holdings, LLC )

 

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Schedule 6

Company Subsidiaries

 

Mobileye Vision Technologies Ltd. (the “Israeli Subsidiary”)

 

Mobileye Inc. (the “U.S. Subsidiary”)

 

Mobileye Germany GmbH (the “German Subsidiary”)

 

Mobileye Technologies Limited (the “Cyprus Subsidiary”)

 

Mobileye Japan Ltd. (the “Japanese Subsidiary”)

 

Mobileye (Shanghai) Automotive Service Co. Ltd. (the “Chinese Subsidiary”; together with the Israeli Subsidiary, the U.S. Subsidiary, the German Subsidiary, the Cyprus Subsidiary and the Japanese Subsidiary, together the “Company Subsidiaries” and each individually a “Company Subsidiary”).

 

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Schedule 7

Bank Accounts

 

[NOTE: Schedule to be mutually agreed prior to the execution of the final Asset Sale Agreement.]

 

 36 

 

 

Schedule 8

Interpretation

 

1.In this Agreement:

 

Account Receivables” means the rights to (a) any amounts due or payable to the Company in connection with the Business relating to the period before Completion, (b) any amounts which become due or payable to the Company after Completion in connection with goods supplied or services performed in connection with the Business prior to Completion, (c) any interest payable on such amounts and (d) the benefit of all securities, guarantees, indemnities and rights relating to those amounts;

 

Asset” means any part of the Business, including all Contracts, assets, permits, claims and rights and any benefits arising thereunder or resulting therefrom;

 

Bank Accounts” means the bank accounts and deposits of the Company listed in Schedule 7 (Bank Accounts);

 

Breach” means, with respect to any Party, any failure of the Warranties of such Party to be true and correct on the date of Completion;

 

Business” means the business of the Company including all Assets and Liabilities of the Company as at Completion including for the avoidance of doubt, any such Assets and Liabilities arising, accruing or incurred after Completion to the extent they relate to and/or arise from the Business as conducted in the period up to and including Completion, including but not limited to:

 

(a)the Company Subsidiary Shares;

 

(b)the Contracts, including the Indemnification Agreements;

 

(c)the Account Receivables;

 

(d)the Claims Receivables;

 

(e)the Company Net Cash Amount, although, save for any Company Excess Cash to be paid to Buyer in accordance with this Agreement, the Company Net Cash Amount will not be paid to Buyer on Completion;

 

(f)the balances in the Bank Accounts (positive or negative), although the Bank Accounts themselves will not be transferred to Buyer upon Completion; and

 

(g)all other assets and liabilities of the Company (including inter-company receivables of the Company from any member of the Company’s Group and inter-company payables of the Company to any other member of the Company’s Group), other than:

 

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(i)any shares held by the Company in its own capital;

 

(ii)the Bank Accounts;

 

(iii)any records that must remain with the Company under statutory (including Tax) obligations;

 

(iv)the engagement letter with the Liquidator, if any; and

 

(v)the listing agreement with NYSE,

 

such excluded assets and liabilities referred to under (i) through (v), the “Excluded Assets and Liabilities”;

 

Buyer’s Group” means Buyer and its Affiliates, including, after Completion, the Company and the Company Subsidiaries;

 

Chinese Subsidiary” has the meaning assigned to such term in Schedule 6;

 

“Claims Receivables” means any claims of the Company vis-à-vis third parties in respect of the Business as at Completion;

 

Company Board” means the board of directors (bestuur) of the Company;

 

Company’s Group” means the Company and its Group but excluding Buyer’s Group;

 

Company Subsidiary” has the meaning assigned to such term in Schedule 6;

 

Company Subsidiary Shares” means the entire issued share capital of each of the Company Subsidiaries;

 

Completion” means completion of the completion steps as set out in Schedule 1 (Completion) under 1 through 4(d)(A);

 

Contracts” means the following:

 

(a)all agreements and binding arrangements of the Company in relation to the Business, including those as listed in Schedule 3 (Contracts);

 

(b)the agreements and binding arrangements relating to the Business as at Completion entered into by the Company in the ordinary course of business after the date hereof; and

 

(c)all offers made by the Company or by third parties in favour of or to the Company as at Completion relating to the Business that are made in the ordinary course of the Business;

 

Cyprus Subsidiary” has the meaning assigned to such term in Schedule 6;

 

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German Subsidiary” has the meaning assigned to such term in Schedule 6;

 

Group” means, in relation to any person or entity, such person or entity and its Affiliates;

 

Indemnification Agreements” means the agreements between the Company and its directors and officers listed on Schedule 9 hereto;

 

Information” means all information relating to the Business, including industrial and commercial information and techniques, including all information relating to the supply of any materials to the Business and to the marketing of any products or services supplied by the Business, including customer and supplier details and lists, sales and purchase targets and statistics, market share statistics, marketing surveys and reports, marketing research and any advertising or other promotional materials, financial and accounting records, studies, correspondence and personal records;

 

Japanese Subsidiary” has the meaning assigned to such term in Schedule 6;

 

Pre-Wired Asset Sale Ruling” has the meaning set forth in Section 5.05(c) of the Purchase Agreement;

 

Settlement Agent” means the settlement agent appointed by Buyer in the Offer;

 

Shareholders” has the meaning ascribed to it in recital (B) and Shareholder means any of them;

 

Subsidiaries” means, with respect to any Person, any entity of which: (i) such Person or any other Subsidiary of such Person is a general partner (in the case of a partnership) or managing member (in the case of a limited liability company); (ii) voting power to elect a majority of the board of directors, board of managers or others performing similar functions with respect to such organization is held by such Person or by any one or more of such Person’s Subsidiaries; (iii) at least fifty percent (50%) of any class of shares or capital stock or of the outstanding equity interests are beneficially owned by such Person; or (iv) any Person that would otherwise be deemed a “subsidiary” under Rule 12b-2 promulgated under the 1934 Act, including, with respect to the Company, the legal entities listed in Schedule 6 (Company Subsidiaries);

 

Tax Authority” means any Governmental Authority, Taxing authority or other authority competent to impose or collect any Tax;

 

Taxation” or “Tax” means all forms of Taxation, duties, levies, imposts and social security charges, including corporate income tax, wage withholding tax, national social security contributions and employee social security contributions, value added tax, customs and excise duties, capital tax and other legal transaction taxes, dividend withholding tax, (municipal) real estate taxes, other municipal taxes and duties, environmental taxes and duties and any other type of taxes or duties in any relevant jurisdiction; together with any interest, penalties, surcharges or fines relating thereto, due, payable, levied, imposed upon or claimed to be owed in any relevant jurisdiction;

 

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U.S. Subsidiary” has the meaning assigned to such term in Schedule 6; and

 

Warranties” means the representations and warranties contained in ‎Article 12 and ‎Article 13 and “Warranty” means any of them.

 

2.The following terms are defined elsewhere in the Agreement, as indicated below:

 

Term Section
   
Agreement Introduction
Asset Sale Recitals
Buyer Introduction
Cash Purchase Amount ‎Section 3.1(a)
Company Introduction
Company Excess Cash ‎Section 3.3
Company Excess Cash at Completion ‎Section 3.3
Company Net Cash Amount ‎Section 3.1(a)
Completion Conditions ‎Section 4.1
Counterparties ‎Section 7.2
Counterparty ‎Section 7.2
Dutch Chosen Courts ‎Section 23.14
Indemnified Party ‎Section 15.2
Liquidation Costs and Liabilities ‎Article 19
Liquidation End Date ‎Section 7.4
Losses ‎Section 15.1
Minority Shareholders ‎Section 3.1(a)
Net Cash Deduction ‎Section 3.2(a)
Offer Recitals
Offer Consideration Recitals
Parent Recitals
Parties Introduction
Party Introduction
Purchase Agreement Recitals
Second Step Distribution ‎Section 18.1
Settlement Agent Account ‎Section 3.2(a)
Shareholders Recitals
Transaction Recitals
Wrong Box Assets ‎Article 10

 

3.Any express or implied reference to an enactment (which includes any legislation in any jurisdiction) includes references to:

 

(a)that enactment as amended, extended or applied by or under any other enactment before or after the date hereof;

 

(b)any enactment which that enactment re-enacts (with or without modification); and

 

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(c)any subordinate legislation (including regulations) made (before or after the date hereof) under that enactment, including (where applicable) that enactment, as amended, extended or applied as described in subparagraph (a) above, or under any enactment referred to in subparagraph (b) above.

 

4.In this Agreement, references to an individual/a natural person include his estate and personal representatives.

 

5.References to a company shall be construed so as to include any company, corporation or other body corporate or other legal entity, wherever and however incorporated or established, including limited or unlimited partnerships.

 

6.References to a person shall be construed so as to include any individual, firm, company, government, Governmental Authority, Tax Authority, state or agency of a state or any joint venture, association or partnership (whether or not having separate legal personality).

 

7.Notwithstanding ‎Section 23.15, where in this Agreement a Dutch term is given in italics or in italics within parentheses after an English term and there is any inconsistency between the Dutch and the English, the meaning of the Dutch term shall prevail.

 

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Schedule 9

Indemnification Agreements

 

[NOTE: Schedule to be mutually agreed prior to the execution of the final Asset Sale Agreement.]

 

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ANNEX 2

 

DRAFT CONVERSION DEED OF AMENDMENT

 

 

 

 

ANNEX 2

CONVERSION DEED OF AMENDMENT

Draft dated 4 May 2017

 

On the [●] day of [●]

two thousand and [●], appearing before me,

Martine Bijkerk, a civil-law notary in Amsterdam, is:

[●].

RECITALS

The person who appears before me, hereby declares:

A.Latest amendment to the articles of association

The latest amendment to the articles of association of Mobileye N.V., a company with limited liability (naamloze vennootschap), with its corporate seat in Amsterdam and its place of business at (97775) Jerusalem, Israel, Har Hotzvim, 13 Hartom Street, registered with the trade register under number 34158597 (the "Company"), has been executed on the twelfth day of December two thousand and fourteen before a deputy for N.C. van Smaalen, a civil-law notary in Amsterdam.

B.Resolution to convert the Company

The general meeting of the Company has resolved to convert (omzetten) the Company into a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid), effective upon execution of this deed of amendment (the "Conversion Resolution").

C.Resolution to amend the articles of association

The general meeting of the Company has resolved to amend the articles of association of the Company and to adopt new articles of association in substitution therefore (the "Amendment Resolution").

D.Authorization

Furthermore it was resolved to authorize the person appearing to sign the deed of amendment of the articles of association.

E.Minutes

Evidence of said resolutions is by means of the minutes of the general meeting dated the [●] day of [●] two thousand and seventeen.

F.Conditions Precedent

The Amendment Resolution provides that the execution of the present deed of amendment of the articles of association is subject to certain conditions precedent (the “Conditions Precedent”), which shall be conclusively evidenced by the delivery to the notary of a certificate, signed by an executive director of the Company, to the effect that the Conditions Precedent have been

 

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satisfied (the "Certificate"). The Certificate has been annexed to the present deed.

CONVERSION

In performance of the Conversion Resolution, the person appearing declares to convert the Company into a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid), within the meaning of Section 2:18 of the Dutch Civil Code.

AMENDMENT OF THE ARTICLES OF ASSOCIATION

[CurrentIn performance of the Amendment Resolution, the person appearing declares to amend the articles of association] as follows:

CHAPTER I

Definitions

Article 1.

In these Articles of association, the following terms shall have the following meaning:

-a. General Meeting: the corporate body of the Company constituting the general meeting of shareholders of the Company or a meeting of such corporate body;
-b. depositary receipts: depositary receipts for shares in the Company. Unless the context indicates otherwise, such receipts include depositary receipts issued with or without the Company's co-operation. To depositary receipts issued with the Company's co-operation meeting rights are attached;
-c. depositary receipt holders: holders of depositary receipts issued with the Company's co-operation. Unless otherwise stated such holders include persons who, as a result of any right of usufruct or right of pledge created on any share, have the rights conferred by law upon the holders of depositary receipts issued with the Company's co-operationmeeting rights;
-d. annual accounts: the balance sheet and profit and loss account plus explanatory notes and additional information thereto;
-meeting rights: means the right to, either in person or through a holder of a written power of attorney, attend a General Meeting and to address such General Meeting;
-e. subsidiary:
-          a legal entity in respect of which the Company or any of its subsidiaries, whether or not pursuant to an agreement with other persons entitled to vote, can exercise either individually or collectively, more than one-half of the voting rights at the general meeting of such entity;
-          a legal entity of which the Company or any of its subsidiaries are members or shareholders, and in respect of which the Company or any of its subsidiaries have, either individually or collectively, the right to appoint or dismiss more than half of such legal entity's directors or supervisory directors, whether or not pursuant to any agreement with other persons having voting rights, if all persons having voting rights in fact cast their vote;

 

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-f. auditor: a registered accountant or any such other accountant as referred to in Article 2:393 of the Dutch Civil Code, or any organization in which such accountants co-operate;
-g. regulated market: regulated market(s) or multilateral trading facility(/ies), as referred to in Article 1:1 of the Dutch Financial Supervision Act, where shares in the capital of the Company are admitted to trading, or any similar share trading market outside the European Union.

CHAPTER II

Name. Corporate seat. Objects

Article 2. Name and corporate seat

2.1.The name of the Company is Mobileye NB.V.
2.2.The Company has its corporate seat at Amsterdam, The Netherlands.

Article 3. Objects

The objects of the Company are:

a.to develop, manufacture and sell products for the automotive and transportation industries and/or vision-based technologies related to these products;
b.to incorporate, participate in and conduct the management of other companies and businesses;
c.to provide administrative, technical, financial, economic or managerial services to other companies, persons or businesses;
d.to acquire, sell, transfer, manage, develop and exploit real and moveable property and other goods, including patents, trademark rights, licenses, permits, knowhow and other industrial property rights;
e.to extend loans of money and/or to borrow money, and to provide security or guarantee the obligations of other parties in some other manner, or engage itself as jointly and severally liable along with or for other parties; and
f.to perform any and all activities of industrial, financial or commercial nature, with the above being either by itself or in collaboration with third parties and including performing and promoting any directly or indirectly related actions, all in the widest sense of the word/words.

CHAPTER III

Capital and shares. Register of shareholders

Article 4. Authorized capital

4.1.The authorized capital amounts to ten million one hundred twenty-five thousand six hundred fifty-seven euros and twenty-five eurocents (EUR 10,125,657.25) and is divided into one billion twelve million five hundred sixty-five thousand seven hundred twenty-five (1,012,565,725) ordinary shares, each with a nominal value of one eurocent (EUR 0.01).
4.2.All shares shall be in registered form.
4.3.The shares may be divided into fractional shares (onderaandelen).

 

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4.3.4.4. No share certificates shall be issued for shares.

Article 5. Register of shareholders

5.1.The Board of Directors shall keep, or cause to be kept, a register in which the names and addresses of all shareholders shall be recorded, specifying the date on which they acquired their shares, the date of acknowledgment by, or service upon the Company of notice of, the transaction by which such person became a shareholder, as well as the amount paid up on each share. The register shall also contain the names and addresses of all holders of a right of usufruct or pledge on shares, specifying the date on which they acquired such right, the date of acknowledgment by, or service upon the Company of notice of, such right and what rights such persons have been granted as referred to in ArticlesArticle 12 and Article 13.
5.2.With due observance of the relevant statutory provisions, the register shall be kept by or on behalf of the Company, shall be regularly updated and, at the discretion of the Board of Directors, may, in whole or in part, be kept in more than one copy and at more than one address.
5.3.Part of the register may be kept abroad in compliance with applicable laws or pursuant to the regulations of a regulated market to which shares are admitted to trading.

CHAPTER IV

Issue of shares. Own shares

Article 6. Issue of shares. Authorized corporate body

6.1.The Company shall only issue shares pursuant to a resolution of the General Meeting or of another corporate body designated to do so by a resolution of the General Meeting for a fixed period not exceeding five years. The designation must be accompanied by a stipulation as to the number of shares that may be issued. The designation may each time be extended for a period of up to five years. The designation may not be cancelled, unless the designation provides otherwise.
6.2.A decision by the General Meeting to issue shares or to designate another body to issue shares can only be taken upon the proposal of the Board of Directors.
6.3.Within eight days after the resolution of the General Meeting to issue shares or to designate a corporate body, the Company shall deposit a full text thereof at the trade register.
6.4.Within eight days after the end of each quarter, the Company shall notify the trade register of each issue of shares, stating the number of shares.
6.2.6.5. The provisions of ArticlesArticle 6.1 through 6.3 shall apply mutatis mutandis to the granting of rights to subscribe for shares, but shall not apply to the issue of shares to someone who exercises a previously existing right to subscribe for shares.

 

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Article 7. Terms and conditions of issue. Pre-emptive rights

7.1.If a resolution to issue shares is adopted, the issue price of the shares and the other conditions of the issue shall also be determined in the resolution.
7.2.Each shareholder shall have a pre-emptive right with respect to any share issue in proportion to the aggregate nominal value of his shares, except if shares are issued for a non-cash consideration or if shares are issued to employees of the Company or of a group company.
7.3.The Company shall announce the issue of shares which are subject to pre-emptive rights and the period of time during which such rights may be exercised, in the Staatscourant (Official Gazette), in a Dutch national daily newspaper and further any other publication as required in accordance with the laws of the regulated market on which shares in the Company’s capital are admitted to trading. The previous sentence does not apply if all shareholders are notified in writing of a proposed issuance in respect of which pre-emptive rights are applicable at the address indicated by each of them in the shareholders register.
7.4.Pre-emptive rights may be exercised within at least two weeks after the day when the announcement in the Staatscourant (Official Gazette) was published or after the notification of the issuance was sent to the shareholders.
7.5.Pre-emptive rights may be restricted or excluded by a resolution of the General Meeting. The reasons for the exclusion of pre-emptive rights and the issue price of the shares to be issued without pre-emptive rights must be given in writing in the proposal to adopt such resolution. Pre-emptive rights may also be excluded or restricted by the authorized corporate body referred to in Article 6.1 if such corporate body is authorized by the resolution of the General Meeting for a fixed period, not exceeding five years, to restrict or exclude pre-emptive rights. The designation may each time be extended for a period of up to five years. Unless determined otherwise, the designation cannot be cancelled. Upon termination of the authority of the corporate body to issue shares, its authority to restrict or exclude pre-emptive rights shall also terminate.
7.6.A resolution of the General Meeting to restrict or exclude pre-emptive rights or to authorize a corporate body to restrict or exclude pre-emptive rights, shall require a majority of at least two-thirds of the votes cast if less than one-half of the issued capital is represented at the General Meeting. Within eight days after the resolution, the Company shall deposit the full text thereof at the trade register.
7.7.Upon the granting of rights to subscribe to shares, the shareholders shall have a pre-emptive right. The provisions of the previous paragraphs of this Article shall apply mutatis mutandis to the granting of rights to subscribe to shares. Shareholders shall have no pre-emptive rights in respect of shares issued to a

 

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person who exercises a right to acquire shares granted to him at an earlier date.

Article 8. Payment for shares. Payment in cash. Non-cash Contribution

8.1.Upon the issue of each share, the nominal value must be fully paid up, and, in addition, if the share is subscribed for at a higher amount, such amount must be fully paid. It may be stipulated that a part, not exceeding three quarters of the nominal value, needsor part thereof, need only be paid after such part is called up by the Company.
8.2.Payment for shares shall be made in cash unless a non-cash contribution has been agreed. Payment in foreign currency may only be made with the Company's approval. If payment is made in foreign currency, the payment obligation shall be considered fulfilled up to the Netherlands currency amount into which the foreign currency can be freely converted. The basis for determination shall be the rate of exchange on the day of payment. If the shares or depositary receipts will without delay, upon issue, be admitted to trading on a regulated market outside The Netherlands, the Company may demand that payment be made based on the rate of exchange on a fixed day within two months before the last day on which payment must be made. If payment is made in foreign currency, a banker's statement as referred to in Article 2:93a paragraph 2 of the Dutch Civil Code shall be deposited at the trade register within two weeks after payment.
8.3.The Board of Directors is authorized to enter into an agreement relating to payment for shares other than in cash. In accordance with Article 2:94204b paragraph 1 of the Dutch Civil Code, a description shall be drawn up of the contribution to be made.
8.4.An auditor as mentioned in Article 2:393 paragraph 1 of the Dutch Civil Code shall issue a statement on the description of the contribution to be made.
8.5.The provisions set out in this Article relating to the description and auditor's statement shall not apply to the cases referred to in Article 2:94b paragraph 3 or paragraph 5 of the Dutch Civil Code.
8.4.8.6. The Board of Directors is authorized to take actions as specified in Article 2:94204 of the Dutch Civil Code without approval of the General Meeting.

Article 9. Own shares. Financial assistance

9.1.The Company may not subscribe for its own shares, or depositary receipts therefor, upon the issue thereof.
9.2.The Board of Directors resolves on the acquisition of shares in the capital of the Company. The acquisition by the Company of shares in its own capital when those shares have not been fully paid up shall be null and void.
9.3.9.2. The Company may only acquire fully paid up shares in its own capital, or depositary receipts therefor, without consideration or if:

 

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a.its shareholders equity, determined as set forth in Article 9.3, less the acquisition price, is not less than the sum of the paid and called up part of its capital and the reserves, which must be maintained by law or under the Articles,; and
b.the nominal amount of the shares in its capital or depositary receipts thereof which the Company acquires, holds, holds as pledgee or which are held by a subsidiary company, is not more than one half of the Company’s issued capital. Board of Directors neither knows or should reasonably foresee that the Company upon acquisition will not be able to continue paying its debts when they become due.
9.3.The validity of the acquisition shall be determined on the basis of the amount of the Company's equity according to the most recently adopted balance sheet decreased with the acquisition price of shares in the Company's capital or depositary receipts, the amounts of loans referred to in Article 98c, paragraph 2 of the Dutch Civil Code and any distributions to others out of profits or reserves which became payable by the Company and its subsidiaries after the date of that balance sheet. If more than six months have elapsed since the expiration of a financial year without adoption of the annual accounts for that year, an acquisition in accordance with the provisions of Article 9.2 is not permitted.
9.4.The Board of Directors shall require the authorization of the General Meeting for an acquisition other than for no consideration. Such authorization resolution of the General Meeting shall be valid for a maximum period of eighteen months. In the authorization resolution, the General Meeting shall determine (i) the number of shares (including depositary receipts) that may be acquired, (ii) how the shares (including depositary receipts) may be acquired and (iii) the limits of the share prices within which shares (including depositary receipts) may be acquired.
9.5.The authorization resolution of the General Meeting, as referred to in Article 9.4, is not required to the extent the Company acquires its own shares or depositary receipts admitted to trading on any regulated market, in order to transfer such shares or depositary receipts to employees of the Company or of a group company, pursuant to a scheme applicable to such employees.
9.6.The Company may not with a view to any other party subscribing to or acquiring the Company's shares or depositary receipts, provide security or any price guarantee, act as surety in any other manner, or bind itself jointly and severally or otherwise in addition to or on behalf of others. This prohibition shall also apply to its subsidiaries.
9.7.The Company and its subsidiaries may not grant loans with a view to subscribing for its own shares or depositary receipts therefor or any other party acquiring shares in the capital of the Company or depositary receipts therefor,

 

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unless the Board of Directors passes a resolution to that effect and the conditions of Article 2:98c paragraphs 2 up to and including 7 of the Dutch Civil Code are fulfilled. This prohibition shall not apply if shares or depositary receipts therefor are subscribed for or acquired by employees of the Company or a group company.

9.8.Shares in the Company's capital and depositary receipts therefor may, upon issue, not be subscribed for by or on behalf of any of the Company’s subsidiaries. The subsidiaries may acquire such shares or depositary receipts for their own account only insofar as the Company is permitted to acquire its own shares or depositary receipts pursuant to Articles 9.2 up to and including 9.5.
9.4.9.9. Disposition of any of the Company’s own shares or depositary receipts held by the Company shall require a resolution of the General Meeting provided that the General Meeting has not granted the authority to issue shares to another corporate body, in which case that other corporate body shall also be authorized to dispose of shares or depositary receipts in the Company’s own capital held by the Company. Pre-emptive rights are not applicable to any disposition of shares or depositary receipts pursuant to this Article 9.9.9.4.
9.5.9.10. The Company may not cast votes in respect of the Company’s own shares that are held by the Company or in respect of the Company’s own shares on which the Company has a right of usufruct or pledge. Nor may any votes be cast by the pledgee or usufructuary of the Company’s shares that are held by the Company if the right of pledge or usufruct was created by the Company. No votes may be cast in respect of the shares in respect of which depositary receipts are held by the Company. The provisions of this paragraph shall also apply to shares or depositary receipts held by any subsidiary or in respect of which any subsidiary holds a right of usufruct or pledge.
9.6.9.11. When determining to what extent the Company's capital is represented, or whether a majority represents a certain part of the capital, the shares for which no votes can be cast shall be disregarded.
9.7.After the acquisition of its own shares at least one share with voting rights shall be held by and on behalf of someone other than the Company or one of its subsidiaries.

Article 10. Capital reduction

10.1.At the proposal of the Board of Directors theThe General Meeting may, with due observance of the relevant statutory provisions, resolve to reduce the issued capital by a cancellation of shares held by the Company or by amending the articles of association to reduce the nominal amount of the shares. Such resolution should not lead to repayment at the expense of reserves which should be maintained in accordance with Dutch law.

 

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10.2.For a resolution to reduce the capital, a majority of at least two-thirds of the votes cast shall be required if less than one-half of the issued capital is represented at the meeting.
10.3.After the cancellation of shares at least one share with voting rights should be held by and on behalf of someone other than the Company or one of its subsidiaries.
10.4.10.3. The convening notice calling a General Meeting at which a motion for capital reduction is proposed, shall specify the purpose of the capital reduction as well as the method of reduction.
10.5.Article 25.3 shall apply mutatis mutandis to a resolution to reduce the issued capital with repayment on shares.

CHAPTER V

Transfer of shares. Usufruct. Pledge

Article 11. Transfer of shares

11.1.The transfer of shares shall require a deed intended for that purpose which has been executed before a civil-law notary practising in the Netherlands, and also, except if the Company itself is a party to that legal act, a written acknowledgement of the transfer by the Company.
11.2.The provisions of Article 11.1 shall also apply to the allotment of shares in the event of a partition of any jointly held property, the transfer of a share as a consequence of foreclosure of a right of pledge, the creation, surrender and transfer of a right of usufruct on a share and the creation and surrender of a right of pledge on a share.
11.3.No restriction as referred to in article 2:195 paragraph 1 of the Dutch Civil Code is applicable to the transfer of shares in the capital of the Company.

Article 12. Usufruct

12.1.A shareholder may freely create a right of usufruct on one or more of his shares.
12.2.The shareholder shall have the voting rights attached to the shares on which the usufruct has been established.
12.3.In deviation from Article 12.2, the voting rights shall be vested in the usufructuary if such is determined upon the creation of the right of usufruct.
12.4.The shareholder without voting rights and the usufructuary with voting rights shall have the rights conferred by law upon depositary receipt holders with meeting rights. The usufructuary without voting rights shall also have such rights unless these are withheld from such person upon the creation or transfer of the usufruct.

Article 13. Pledge

13.1.A shareholder may create a right of pledge on one or more of his shares.
13.2.The shareholder shall have the voting rights attached to the shares on which

 

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the pledge has been established.

13.3.In deviation from Article 13.2, the voting rights shall be vested in the pledgee if such is provided upon the creation of the pledge.
13.4.The shareholder without voting rights and the pledgee with voting rights shall have the rights conferred by law upon depositary receipt holders with meeting rights. Pledgees without voting rights shall also have such rights unless these are withheld from them upon the creation or transfer of the pledge.
13.5.If a pledge is created without acknowledgement by or service on the Company, the rights pursuant to the provisions of this Article 13 shall vest in the pledgee only after the pledge has been acknowledged by, or notice thereof has been served on, the Company.

CHAPTER VI

Board of Directors

Article 14. Board of Directors.

14.1.The Board of Directors shall be in charge of managing the Company, subject to the restrictions set forth in these Articles of Association, in particular those relating to the allocation of responsibilities between the executive directors and the non-executive directors.
14.2.In performing their duties, the directors shall act in accordance with the interest of the Company and the business connected to it.

Article 15. Appointment.

15.1.The Board of Directors shall consist of one or more executive directors and one or more non-executive directors. The executive directors and the non-executive directors are hereinafter jointly also referred to as the “directors”.

The Board of Directors shall initially, as of the date of execution of this deed of amendment, subject to the provisions of the following sentence, consist of seven (7) persons, of whom two (2) shall be executive directors and five (5) shall be non-executive directors. The total number of directors, the total number of executive directors and the total number of non-executive directors, shall be laid down in, and may be increased or decreased pursuant to a resolution of the Board of Directors approved by a majority vote of all of the executive directors, and a majority vote of all of the non-executive directors, then in office, the General Meeting. A decrease in the number of directors, or in the number of executive or non-executive directors, shall not result in a decrease in the term of office of any director in office at the time of such decrease in the number of directors. Only natural persons can be directors.

15.2.The non-executive directors shall supervise the fulfilment of their duties by the executive directors and shall supervise the general affairs of the Company. The executive directors are responsible for the day-to-day management of the Company, in accordance with general policies adopted from time to time by the

 

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Board of Directors. Non-executive directors shall be involved in the day-to-day management of the Company only in relation to those matters specifically assigned to non-executive directors or to the Board of Directors as a whole pursuant to these Articles of Association or the corporate governance guidelines (reglement) of the Board of Directors, and only to the extent specifically so entrusted by these Articles of Association and the corporate governance guidelines to the non-executive directors or the Board of Directors as a whole.

15.3.The executive directors shall comply with any specific instructions given to them by the Board of Directors as a whole.
15.4.No non-executive director shall be obligated to take any steps to prevent any actual or alleged mismanagement (onbehoorlijke taakvervulling) of the Company and its subsidiaries except if and to the extent that the relevant non-executive director has actual knowledge of, or, after exercise of reasonable inquiry consistent with his duties as a non-executive director of the Company, should have had knowledge of, the facts constituting such actual or alleged mismanagement.
15.5.The executive directors and non-executive directors shall be appointed by the General Meeting. A director shall be designated by the General Meeting as an executive director or a non-executive director at the time of his election to the Board of Directors.
15.6.Except as otherwise provided in this Article 15.6, the directors shall serve for a term of three (3) years from the date of their election until the end of the annual General Meeting held in the third year following their election. However, (i) the initial term of office of the executive directors serving as such immediately prior to the execution of this deed of amendment shall expire at the end of the annual General Meeting held in the year two thousand fifteen and (ii) the initial term of office of the non-executive directors serving as such immediately prior to the execution of this deed of amendment shall expire at the end of the annual General Meeting held in the year two thousand sixteen. The Board of DirectorsThe General Meeting may, at the time of its proposal to the General Meeting to elect a new director is elected to fill a vacancy as a consequence of a change in the number of directors, or otherwise, determine that a particular newly elected director will serve for a shorter or longer term than three (3) years to ensure that the terms of office of approximately one-third of the members of the Board of Directors expire each year.
15.7.The Board of Directors shall appoint one of its non-executive members to be its Presiding Director (voorzitter) for such period as the Board of Directors may decide. The Presiding Director presides at the meeting of the Board of Directors.

 

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15.8.The Board of Directors may designate one of the executive directors as Chief Executive Officer and one of the executive directors as Chairman of the Company.
15.9.Except as otherwise permitted by Article 132242a of Book 2 of the Dutch Civil Code, a director may hold a maximum of two (2) memberships of supervisory boards and/or non-executive board memberships of Dutch limited liability companies (naamloze vennootschappen), Dutch private companies with limited liability (besloten vennootschappen met beperkte aansprakelijkheid) and Dutch foundations (stichtingen) which do not meet at least two of the statutory requirements as laid down in Article 2:397 paragraph 1 and 2 Dutch Civil Code (or, in the case of a foundation, Article 297a, paragraph 1, of the Dutch Civil Code), taking into account that the chairmanship of a supervisory board or of a Board of Directors, in case the board is divided into executive and non-executive directors, counts twice for these purposes.
15.10.The appointment of a member of the Board of Directors in itself does not constitute an employment contract (arbeidsovereenkomst) between the member of the Board and the Company. An employment contract between the Company and a director is prohibited.

Article 16. Suspension and dismissal.

16.1.The General Meeting shall at all times have the power to suspend or dismiss each director, provided that the resolution is passed by a majority of no less than two-thirds of the votes cast, which vote also represents more than one-half of the Company’s issued capital.

The Board of Directors as a whole shall also have the power to suspend each executive director.

16.2.Any such suspension may be extended several times but the total term of the suspension may not exceed three (3) months. The suspension shall expire at the end of this period if no resolution has been adopted either to lift the suspension or to dismiss the director.

Article 17. Compensation.

17.1.The Company shall have a policy regarding the compensation of the Board of Directors. The compensation policy shall be adopted by the General Meeting upon the proposal of the Board of Directors and may only be amended by the General Meeting pursuant to a proposal of the Board of Directors. The compensation policy shall contain at least the items as set forth in Article 2:383c up to and including Article 2:383e of the Dutch Civil Code, to the extent that these relate to the directors.
17.2.The compensation and the other terms and conditions of service of each executive director are determined by the non-executive directors acting by a majority vote of all non-executive directors in office, with due observance of the

 

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compensation policy. The compensation of the non-executive directors is determined by the General Meeting pursuant to a proposal of the Board of Directors.

17.3.A proposal for the compensation of directors in the form of shares or rights to acquire shares shall be submitted by the Board of Directors to the General Meeting for approval. Approval of option or share grants to directors may also cover all future grants by the Board of Directors or a committee thereof under present and future equity incentive plans approved by the Board of Directors from time to time, within the limits of the shares available for grant under such plans from time to time.

Article 18. Decision-making. Division of duties.

18.1.The Board of Directors shall meet as often as any two directors may deem necessary.
18.2.In the meeting of the Board of Directors each director has a right to cast one vote. Except as specifically provided herein, all resolutions by the Board of Directors shall be adopted by an absolute majority of the votes cast in a meeting at which a majority of the directors is present or represented. If there is a tie in votes, the proposal will be rejected. Matters that are specifically entrusted to the non-executive directors as a group pursuant to these Articles or the provisions of Dutch law shall be decided by a majority vote of all non-executive directors in office at the time of the relevant decision.
18.3.A director may grant another director a written proxy to represent him at a particular meeting indicated in such proxy.
18.4.Resolutions of the Board of Directors may be adopted in writing – including any electronic message and facsimile, or in the form of a message transmitted by any accepted means of communication and received or capable of being produced in writing – by all directors in office who are entitled to vote on the relevant resolution provided that all directors are familiar with the resolution to be passed and none of them objects to this decision-making process.
18.5.The Board of Directors may adopt rules and regulations governing its decision-making process.
18.6.Subject at all times to the provisions of Articles 15.1 up to and including 15.4, the Board of Directors may make a division of duties, specifying the individual duties of every director.
18.7.Subject to the provisions of Article 18.8, a director shall not take part in any discussion or decision-making in respect of which such director has directly or indirectly personally a conflict of interest with the Company and the business connected to it.
18.8.If no resolution can be adopted by the Board of Directors as a result of Article 18.7 because all directors have a conflict of interest, the Board of Directors

 

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shall nonetheless be authorized to adopt a resolution and those directors who have a conflict of interest shall be entitled to vote on such resolution.

18.9.The executive directors shall timely provide the non-executive directors with any such information as may be necessary for the non-executive directors to perform their duties or as may be requested from time to time by any non-executive directors.
18.10.The Board of Directors may establish such committees as it may deem necessary. The Board of Directors appoints the members of each committee and determines the tasks of each committee. The Board of Directors may at any time change the duties and the composition of a committee.

If the Board of Directors consists of more than four (4) non-executive directors, the Board of Directors must establish at least an audit committee, a compensation committee and a nominating and corporate governance committee.

The Board of Directors shall draw up charters governing each committee’s internal affairs.

Article 19. Representative authority.

19.1.The Board of Directors shall represent the Company. The authority to represent the Company shall also be vested in each executive director individually. For the avoidance of doubt, the non-executive directors shall have no authority to represent the Company individually except as provided in Article 22 in the case of absence or inability to act of all executive directors.
19.2.The Board of Directors may appoint officers and grant them a general or special power of attorney. Their titles shall be determined by the Board of Directors. Every attorney in fact shall represent the Company within the bounds of his or her authorization.

Article 20. Approval of executive director actions.

20.1.The Board of Directors may resolve that specific actions by the executive directors must be approved in advance by a resolution of the Board of Directors. All such resolutions subjecting actions of the executive directors to the prior adoption of a resolution of the Board of Directors shall be in writing and notified to the executive directors. The absence of approval by a Board resolution as meant in this Article 20.1 does not affect the representative authority of the executive directors.
20.2.Without prejudice to the other provisions in these Articles of Association, the approval of the General Meeting shall be required for decisions by the Board of Directors leading to an important change in the Company’s or its business enterprise’s identity or character, including in any case:
a.the transfer of the business of the Company or almost the entire business of the Company to a third party;

 

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b.the entering into or termination of any long-term co-operative arrangement between the Company or any subsidiary of the Company and another legal entity or company, or as a general partner in a limited or general partnership, if such cooperative arrangement or termination is of substantial significance for the Company;
c.the disposal of a participation in the capital of a company with a value of at least one-third of the amount of the Company’s assets according to the Company’s consolidated balance sheet, forming part of the most recently adopted annual accounts of the Company; or
d.the acquisition of a participation in the capital of a company with a value of at least one-third of the amount of the Company’s assets according to the Company’s consolidated balance sheet, forming part of the most recently adopted annual accounts of the Company.

Article 21. Conflicts of interests.

Resolutions to enter into transactions in which there is a conflict of interest with any of the directors can only be taken in accordance with the provisions of Articles 18.7 and 18.8.

Article 22. Absence or inability to act.

If an executive director is absent or unable to act, the remaining executive director(s) shall be temporarily charged with the management of the Company. If the sole executive director is, or all executive directors are, absent or unable to act, the following shall apply: The Board of Directors may designate one or more executive officers of the Company who shall be charged with the day-to-day management of the Company, under the supervision of the Board of Directors, during the absence or inability to act of all executive directors, and each such executive officer shall be authorized to represent the Company during the absence or inability to act of all executive directors. During the absence or inability to act of all executive directors, either (i) the Board of Directors, or (ii) any executive officer designated by a resolution of the Board of Directors as set forth in the preceding sentence, acting with the approval of the Board of Directors, may call a General Meeting to fill the vacancy created by the absence or inability to act of all executive directors, if such absence or inability to act of all executive directors continues for thirty (30) days or more. In the absence of a resolution adopted by the Board of Directors as described in the two preceding sentences charging one or more executive officers of the Company with the day-to-day management of the Company during the absence or inability to act of all executive directors, the non-executive directors shall be temporarily charged with the management of the Company during the absence or inability to act of all executive directors and each non-executive director shall be entitled to represent the Company during such absence or inability to act of all executive directors.

If all directors are absent or unable to act, then the executive officers of the Company

 

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shall be charged with the management of the business of the Company, and each such executive officer shall be entitled to represent the Company during the absence or inability to act of all directors and any executive officer may call a General Meeting to fill the vacancies in the Board of Directors. If no executive officer calls a General Meeting for such purpose within thirty (30) days after the first date when all directors were absent or unable to act, then any holder(s) of one percent (1%) or more of the Company’s issued capital may call a General Meeting for such purpose.

CHAPTER VII

Annual accounts. Profits

Article 23. Financial year. Drawing up the annual accounts

23.1.The Company’s financial year shall be concurrent with the calendar year.
23.2.The Board of Directors shall prepare the annual accounts, within five (5) months of the end of each financial year, unless such period is extended in accordance with the provisions of applicable law.
23.3.Within the period for preparation thereof, as referred to in Article 23.2, the annual accounts shall also be made available to the public to the extent required by law. Furthermore, the annual financial information shall be available at the offices of the Company. If requested, the Company shall provide to those entitled to attend meetings copies of the annual financial information free of charge. If these documents are amended, this obligation shall also extend to the amended documents.
23.4.The annual accounts shall be signed by all members of the Board of Directors. If the signature of one or more of them is lacking, this fact and the reason therefor shall be indicated.
23.5.The annual accounts shall be adopted by the General Meeting.
23.6.After adoption of the annual accounts, the General Meeting may by separate agenda items discharge the executive directors, in respect of their management of the Company, and the non-executive directors in respect of their supervision of the Company’s management and their management of the Company to the extent that the non-executive directors have been involved in the management of the Company as set forth herein, in each case during the relevant financial year insofar as this appears from the annual accounts or otherwise is apparent from public disclosures.
23.7.The Company shall be obligated to deposit the annual accounts within eight days after adoption thereof at the office of the trade register.

Article 24. Auditor

24.1.The General Meeting shall instruct an accountant to audit the annual accounts and the annual report, as drawn up by the Board of Directors, to report thereon and to issue an auditor’s certificate with respect thereto. If the General Meeting fails to instruct an external auditor, the Board of Directors shall be authorized to

 

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do so. The annual accounts shall not be adopted by the General Meeting if the General Meeting is not able to take cognizance of the auditor’s certificate, unless a legitimate ground is given why the certificate is lacking.

24.2.The compensation of the external auditor, and instructions to the external auditor to provide non-audit services, shall be approved by the Board of Directors.
24.3.The auditor shall record his findings in a report commenting on the true and fair nature of the annual accounts. The auditor shall send such report to the Board of Directors.
24.4.The external auditor may be questioned by the General Meeting in relation to his statement on the fairness of the annual accounts. The external auditor shall therefore attend and be entitled to address this meeting.

Article 25. Allocations of profit

25.1.The Board of Directors shall determine which portion of the profits shall be reserved. The profit remaining after application of the previous sentence, if any, shall be at the disposal of the General Meeting. A resolution to pay a dividend shall be dealt with as a separate agenda item at the General Meeting.
25.2.The Company may make distributions to the shareholders and other persons entitled to the distributable profits only to the extent that the Company’s shareholders’ equity exceeds the sum of the paid-in capital and the reserves which it is required by law to maintain.
25.3.Distribution of profit shall be effected after the adoption of the annual accounts which show that this is permitted.A resolution to make a distribution has no effect until the Board of Directors has granted approval for such resolution. The Board of Directors shall refuse this approval only if it knows or should reasonably foresee that the Company will be unable to continue to pay its short-term debts after the distribution.
25.4.The Board of Directors may make interim distributions only to the extent that the requirements set forth in Article 25.2 above are satisfied, as apparent from an (interim) financial statement drawn up in accordance with the law.
25.5.The Board of Directors may decide to make payments to holders of shares out of reserves which are not required to be maintained by law or these Articles of Association, if such payment is permitted by Article 25.2.
25.4.25.6. Any claim a shareholder may have to a distribution shall lapse after five (5) years, to be computed from the day on which such a distribution becomes payable.
25.5.25.7. A dividend or other distribution may be payable in cash or other property, including shares in the capital of the Company.
25.6.25.8. The Board of Directors may determine a record date for the payment of a dividend or other distribution, which shall not be earlier than sixty (60) days

 

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before the date of payment of such dividend or other distribution. If the Board of Directors determines a record date for the payment of a dividend or other distribution, only the shareholders of the Company as of such record date shall be entitled to receive the relevant dividend or other distribution, and only in respect of those shares held by such shareholders on such record date.

25.7.25.9. The timing and method of payment of a dividend or other distribution shall be determined by the Board of Directors in accordance with applicable laws and regulations in the resolution for the declaration (betaalbaarstelling) of such dividend or other distribution.

CHAPTER VIII

General meetings

Article 26. Annual General Meeting

26.1.Within six (6) months of the end of the Company's financial year the annual General Meeting shall be held.
26.2.The agenda of that meeting shall, among other matters, contain the following items:
a.discussion of the annual report;
b.adoption of the annual accounts;
c.discharge of the executive directors and non-executive directors for their management and/or supervision of management, as more fully set forth in Article 23.6, during the past financial year;
d.appropriation of profits for the preceding year;
e.filling of any vacancies in the Board of Directors.

Article 27. Other General Meetings

27.1.Within three months after the Board of Directors considers it likely that the equity of the Company has decreased to an amount equal to or less than half of the paid and called up part of the Company’s capital, a General Meeting shall be held to discuss the measures to be taken, if necessary.
27.1.27.2. Without prejudice to the provisions of Articles 26.1, 27.126.1 and Article 22, General Meetings shall be held as often as the Board of Directors deems necessary.

Article 28. Convocation. Agenda

28.1.General Meetings shall be called by the Board of Directors.
28.2.Notice of the meeting shall be given not later than on the fifteenth day prior to the day of the meeting.
28.3.The convening notice shall specify the items to be discussed. Items which have not been specified in the convening notice may also be put on the agenda of the meeting with due observance of the notice requirements of Article 28.2.
28.4.The agenda shall contain such matters as may be placed thereon by the Board of Directors. Furthermore, the agenda shall contain such items as requested in

 

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writing by one or more persons entitled to attend the General Meeting, representing solely or jointly at least threeone percent (31%) of the Company’s issued capital, at least sixty (60) days before the date of the meeting. The meeting shall not adopt resolutions on matters other than those that have been placed on the agenda.

28.5.Notifications of the General Meetings, and all other notifications required by law to be given to shareholders and depositary receiptthe holders of meeting rights, shall be given by an announcement published through the Company’s website and via any other electronic communication method that is directly and permanently accessible until the General Meeting and by mail directed to the shareholders at their addresses shown on the shareholders register, or by email addressed to the email address which a shareholder has indicated in writing to the Company, as well as via such announcements as may be required pursuant to the laws and regulations of each jurisdiction in which the shares of the Company have been admitted to trading on a regulated market. Notice delivered by mail shall be effective when it is placed in the post, postage prepaid, addressed to the relevant shareholder at his address as shown in the shareholders register.

Article 29. Place of the meetings

General Meetings shall be held in the following places in The Netherlands: Amsterdam, The Hague, Rotterdam or Haarlemmermeer (Schiphol Airport). In a meeting held elsewhere, valid resolutions can only be taken if the entire issued capital is represented(i) all persons with meeting rights have declared to consent to the place of the meeting, and (ii) the director(s) has (have) had the opportunity to provide advice prior to the adoption of resolutions. The convening notice shall state the place where the General Meeting shall be held.

Article 30. Imperfect convocation General Meeting

Valid resolutions in respect of matters which were not mentioned on the agenda in the notice of meeting, or which have not been properly published, or in respect of which there has been no due observance of the period set for notice, can only be taken by unanimous votes in a meeting where the entire issued capital is represented, provided that (i) all persons with meeting rights have declared to consent that adoption of resolutions shall take place, and (ii) the director(s) has (have) had the opportunity to provide advice prior to the adoption of resolutions.

Article 31. Chairman

31.1.The General Meetings shall be chaired by the Presiding Director of the Board of Directors. If the Presiding Director of the Board of Directors is not present at a meeting, the meeting shall be chaired by another non-executive director designated by the Board of Directors.
31.2.If no chairman for a meeting has been appointed in accordance with Article

 

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31.1, the meeting shall appoint its chairman itself.

Article 32. Voting results / Minutes

32.1.The voting results for each resolution adopted at a General Meeting, including (i) the number of shares that have been validly voted upon, (ii) the number of shares that have been validly voted upon as a percentage of the issued share capital, (iii) the total number of votes validly cast and (iv) the number of votes cast in favor of and against the resolution as well as the number of abstentions, must be posted on the Company’s website not later than the fifteenth day following the day of the General Meeting.
32.2.Minutes shall be taken of the matters discussed at every General Meeting by a secretary to be appointed by the chairman of the meeting.
32.3.The minutes of the General Meeting shall be made available on the Company’s website no later than three months after the end of the meeting.
32.4.The minutes shall be adopted by the chairman and the secretary of the meeting and signed by them to that effect three months after the minutes have been made available on the Company’s website.
32.5.The chairman of the meeting, or the person who requested the meeting, may decide that an official notarial report should be drawn up of the matters discussed at the meeting. This report must be co-signed by the chairman of the meeting.

Article 33. Rights exercisable during a meeting. Admission

33.1.Every holder of shares and every other party entitled to attend the meeting who derives his rights from such shares, is only entitled to attend the General Meeting in person, or represented by a person holding a written proxy, to address the meeting and, in as far as he has voting rights, to vote at the meeting, if he has lodged documentary evidence of his voting rights or meeting rights within a time and in a manner specified by the Board of Directors in the notice of meeting. Such time may not be earlier than seventhree days before the date of the meeting. The requirement of a written proxy is also met if the proxy is recorded electronically.
33.2.In terms of applying the provisions of Article 33.1, the Board of Directors may determine that those entitled to vote and/or attend the meeting shall be those who (i) are a shareholder or otherwise entitled to attend the meeting on the twenty-eighth day before the General Meeting (“record date”) and (ii) are registered as such in a register (or one of more parts thereof) designated by the Board of Directors, hereinafter referred to as “the register”. If the Board of Directors sets a record date, it must be the date which is exactly twenty-eight (28) days before the date of the General Meeting and not an earlier or later date.
33.3.The convocation to the General Meeting shall state the record date, where and

 

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the manner in which registration shall take place, and the procedure(s) to participate and exercise voting rights in the General Meeting (including procedures for persons holding a written proxy for a shareholder or other person entitled to attend the meeting). The convocation may also provide that (i) shareholders or other persons entitled to attend the meeting may participate in the meeting, cast votes at the meeting and/or speak at the meeting, directly or through the holder of a written proxy, by way of an electronic means of communication designated in the convocation provided that such means of communication satisfies the conditions set forth in Article 2:117a, paragraph 2, of the Dutch Civil Code and/or (ii) that votes cast in advance of the meeting, on or after the record date in respect thereto, by means of an electronic means of communication as specified in the convocation, will be deemed to have been cast at the meeting.

33.2.33.4. The chairman of the General Meeting shall decide whether persons other than those who are entitled to admittance pursuant to the aforementioned provisions shall be admitted to the meeting.
33.3.33.5. The attendance list must be signed by each person with voting rights and/or meeting rights or his representative.
33.4.33.6. The members of the Board of Directors shall have the right to attend the General Meeting. In these meetings they shall have an advisory vote.

Article 34. Decision making by General Meeting

34.1.The Board of Directors shall provide the General Meeting with all information that it requires, unless this would be contrary to an overriding interest of the Company. In the event of such an overriding interest, the Board of Directors shall give the reason for withholding information.
34.2.Resolutions of the General Meeting shall be passed by an absolute majority of the votes cast, unless the law or these Articles of Association prescribe a greater majority.
34.3.The General Meeting may only adopt the following resolutions upon a proposal by the Board of Directorswith the special majority set out below:
a.a resolution to amend the Articles of Association of the Company;
b.a resolution to effect a legal merger (juridische fusie) or demerger (juridische splitsing);
c.a resolution to liquidate or dissolve the Company;
d.a resolution to take one of the actions referred to in Article 20.2.

Any resolution to take any of the actions described in paragraphs a. through c. above, or in Article 20.2.a. through c., can only be adopted by a majority of no less than two-thirds of the votes cast, which vote also represents more than one-half of the Company’s issued capital. In addition, any resolution to approve the acquisition of a participation in the capital of a company, as referred to in

 

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Article 20.2.d., must be adopted by a majority of not less than two-thirds of the votes cast, which vote also represents more than one-half of the Company’s issued capital, if the acquisition has a value of twenty percent (20%) or more of the Company’s Total Market Capitalization at the date of the entering into by the Company of the definitive agreement for such acquisition. As used herein the term “Total Market Capitalization” of the Company as of any date shall mean (i) the total number of the Company’s issued and outstanding ordinary shares as of such date multiplied by (ii) the Closing Price of an ordinary share of the Company as of such date. As used herein the term “Closing Price” of an ordinary share of the Company as of any date shall mean the average closing price of an ordinary share of the Company on the principal securities exchange or interdealer quotation system where the Company’s ordinary shares are then traded, during a period of up to thirty (30) trading days prior to such date, which period shall be determined by the Board of Directors.

34.4.If no absolute majority is reached by a vote taken with respect to the election of persons, a second vote shall be taken whereby the voters are not required to vote for the previous candidates. If, again, no one has gained an absolute majority of the votes, new votes shall be held until either one person has gained an absolute majority or, if the vote was between two persons, the votes are equally divided. Such new votes (except for the second vote) shall only take place between the candidates who were voted for in the previous vote, except for the person who received the lowest number of votes. If in the previous vote two or more persons have the lowest number of votes, it shall be decided by lot who cannot be voted for at the new vote. If, in the event of an election between two candidates, the votes are equally divided, it shall be decided by lot who has been elected.
34.5.If a vote is taken in respect of matters other than in relation to election of persons and the votes are equally divided, the relevant motion shall be considered rejected.
34.6.All voting shall take place orally unless the chairman of the meeting decides to have votes taken in writing or any person entitled to vote requests a vote in writing. A vote in writing shall take place by means of signed ballot papers.
34.7.Abstentions and invalid votes shall be deemed not to have been cast.
34.8.Votes by acclamation shall be allowed unless one of the persons present and entitled to vote objects.
34.9.The view of the chairman of the meeting stated at the meeting expressing that the General Meeting has passed a resolution shall be decisive. The same shall apply to the contents of the resolution so passed, provided that the relevant resolution was not proposed in writing. However, if the chairman's view is challenged immediately after it is expressed, a new vote shall be taken if the

 

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majority of the persons present and entitled to vote so require or, if the original vote was not by voice vote or by ballot, if one person present and entitled to vote so requires. The new vote shall nullify the legal consequences of the original vote.

CHAPTER IX

Amendment to the Articles of Association, dissolution, demerger and merger. Liquidation.

Article 35. Amendment to the Articles of Association and dissolution

35.1.Notwithstanding the provisions of article 2:331 paragraph 1 of the Dutch Civil Code and article 2:334ff paragraph 1 of the Dutch Civil Code, the General Meeting may resolve to merge the Company, or to demerge the Company, as well as to amend the Articles of Association or to dissolve the Company.
35.2.If a proposal to amend the Articles of Association or to dissolve the Company is to be submitted to the General Meeting, the convening notice must state this fact. At the same time, if the proposal is for an amendment toThose who convene a General Meeting in which a proposal is made to adopt a resolution to amend the Articles of Association, must deposit a copy of the proposal containing a, stating the verbatim text of the proposed amendment must be deposited, at the offices of the Company's office for inspection by the shareholders and depositary receipt holders until the meeting is adjourned.. The proposal must be deposited at the same time as the notice of the meeting and kept there until after the close of the meeting. The shareholders must be given the opportunity to obtain a copy of the proposal described in the preceding sentence from the day on which the convening notice for that meeting is dispatched until the day of the General Meeting. Such copies shall be provided free of charge.

Article 36. Liquidation

36.1.If the Company is dissolved pursuant to a resolution by the General Meeting, the directors shall be the liquidators of the Company, unless the General Meeting appoints one or more other persons as liquidatorsperson(s) as liquidator(s). The General Meeting determines the remuneration of the liquidatorsliquidator(s).
36.2.The provisions of these Articles of Association shall, to the fullest extent possible, continue to be in force during the liquidation.
36.3.The surplus remaining after payment of the debts shall be paid to each shareholder in proportion to the total nominal value of such shareholder’s individual shareholding.
36.4.After the Company has ceased to exist the books, records and other carriers of data shall be kept by the person designated thereto by the liquidatorsliquidator(s) for seven years.

 

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CHAPTER X

Indemnification

Article 37. Indemnification

37.1.The Company shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that he is or was a member of the Board of Directors, officer, employee or agent of the Company, or is or was serving at the request of the Company as a supervisory director, member of the management board, officer, director, employee, trustee or agent of another company, partnership, joint venture, trust or other enterprise or entity, against all expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful or outside of his mandate. The termination of any action, suit or proceeding by a judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and not in a manner which he reasonably could believe to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful or outside of his mandate.
37.2.The Company shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding by or in the right of the Company to procure a judgment in its favor, by reason of the fact that he is or was a member of the Board of Directors, officer or agent of the Company, or is or was serving at the request of the Company as a supervisory director, member of the management board, officer, director, employee, trustee or agent of another company, partnership, joint venture, trust or other enterprise or entity, against all expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement, actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for gross negligence or willful misconduct in the performance of his duty to the Company, unless and only to the extent that the court in which such action or proceeding was brought or any other court

 

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having appropriate jurisdiction shall determine upon application that, despite the adjudication of liability but in view of all of the circumstances of the case, such person is fairly and reasonably entitled to indemnification against such expenses which the court in which such action or proceeding was brought or such other court having appropriate jurisdiction shall deem proper.

37.3.To the extent that a member of the Board of Directors, officer, employee or agent of the Company has been successful on the merits or otherwise in defense of any action, suit or proceeding, referred to in Articles 37.1 and 37.2, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection therewith.
37.4.Any indemnification by the Company referred to in Articles 37.1 and 37.2 shall (unless ordered by a court) only be made upon a determination that indemnification of the member of the Board of Directors, officer, director, employee, trustee or agent is proper under the circumstances because he had met the applicable standard of conduct set forth in Articles 37.1 and 37.2. Such determination shall be made:
a.by a majority of the members of the Board of Directors who are not parties to such action, suit or proceeding, even though less than a quorum, or
b.if there are no members of the Board of Directors who are not named as parties to such action, suit or proceeding or if the members of the Board of Directors who are not named as parties to such action, suit or proceeding so direct, by independent legal counsel in a written opinion; or
c.by the General Meeting.
37.5.Expenses incurred in defending a civil or criminal action, suit or proceeding may be paid by the Company in advance of the final disposition of such action, suit or proceeding upon a resolution of the Board of Directors with respect to the specific case upon receipt of an undertaking by or on behalf of the relevant member of the Board of Directors, officer, director, employee, trustee or agent to repay such amount unless it shall ultimately be determined that he is entitled to be indemnified by the Company as authorized in this Article 37.
37.6.The indemnification provided for by this Article 37 shall not be deemed exclusive of any other right to which a person seeking indemnification may be entitled under the laws of The Netherlands as from time to time amended or under any by-laws, agreement, resolution of the General Meeting or of the disinterested members of the Board of Directors or otherwise, both as to actions in his official capacity and as to actions in another capacity while holding such position, and shall continue as to a person who has ceased to be a member of the Board of Directors, officer, director, employee, trustee or agent and shall also inure to the benefit of the heirs, executors and

 

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administrators of such a person.

37.7.The Company shall have the power to purchase and maintain insurance on behalf of any person who is or was a member of the Board of Directors, officer, employee or agent of the Company, or is or was serving at the request of the Company as a supervisory director, member of the management board, officer, director, employee, trustee or agent of another company, partnership, joint venture, trust or other enterprise, or entity, against any liability asserted against him and incurred by him in any such capacity or arising out of his capacity as such, whether or not the Company would have the power to indemnify him against such liability under the provisions of this Article.
37.8.Whenever in this Article 37 reference is made to the Company, this shall include, in addition to the resulting or surviving company also any constituent company (including any constituent company of a constituent company) absorbed in a consolidation or merger which, if its separate existence had continued, would have had the power to indemnify its supervisory directors, members of the management board, officers, employees and agents, so that any person who is or was a supervisory director, member of the management board, officer, employee or agent of such constituent company, or is or was serving at the request of such constituent company as a supervisory director, member of the management board, officer, director, employee, trustee or agent of another company, a partnership, joint venture, trust or other enterprise or entity, shall stand in the same position under the provisions of this Article 37 with respect to the resulting or surviving company as he would have with respect to such constituent company if its separate existence had continued.
37.9.No person shall be personally liable to the Company or its shareholders for monetary damages for breach of fiduciary duty as a member of the Board of Directors; provided, however, that the foregoing shall not eliminate or limit the liability of a member of the Board of Directors (1) for any breach of such individual’s duty of loyalty to the Company or its shareholders, (2) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (3) for any transaction from which the relevant member of the Board of Directors derived an improper personal benefit or (4) for personal liability which is imposed by Dutch law, as from time to time amended. Any amendment, repeal or modification of this Article 37 shall not adversely affect any right or protection of any person with respect to any act or omission occurring prior to such amendment, repeal or modification.

CONCLUSION

The person appearing in connection with this deed is known to me, civil-law notary.

THIS DEED

is executed in Amsterdam on the date stated at the head of the deed.

 

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The substance of this deed and an explanation of the deed have been communicated to the person appearing, who has expressly taken cognisance of its contents and has agreed to its limited reading.

After a limited reading in accordance with the law, this deed was signed by the person appearing and by me, civil-law notary.

 

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ANNEX 3

 

DRAFT POST-DELISTING DEED OF AMENDMENT

 

 

 

 

ANNEX 3

POST-DELISTING DEED OF AMENDMENT

Draft dated 4 May 2017

 

On the [●] day of [●]

two thousand and [●], appearing before me,

Martine Bijkerk, a civil-law notary in Amsterdam, is:

[●].

RECITALS

The person who appears before me, hereby declares:

A.Latest amendment to the articles of association

The latest amendment to the articles of association of Mobileye [B.V.][N.V.], [a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid)][ a company with limited liability (naamloze vennootschap)], with its corporate seat in Amsterdam and its place of business at (97775) Jerusalem, Israel, Har Hotzvim, 13 Hartom Street, registered with the trade register under number 34158597 (the "Company") has been executed [on [●] before M. Bijkerk, aforementioned] [on the twelfth day of December two thousand and fourteen before a deputy for N.C. van Smaalen, a civil-law notary in Amsterdam].

B.Resolution to convert the Company

The general meeting of the Company has resolved to convert (omzetten) the Company into a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid), effective upon execution of this deed of amendment (the "Conversion Resolution").

C.Resolution to amend the articles of association

The general meeting of the Company has resolved to amend the articles of association of the Company and to adopt new articles of association in substitution therefore (the "Amendment Resolution").

D.Authorization

Furthermore it was resolved to authorize the person appearing to sign the deed of amendment of the articles of association.

E.Minutes

Evidence of said resolutions is by means of the minutes of the general meeting dated the [●] day of [●] two thousand and seventeen.

F.Conditions Precedent

The Amendment Resolution provides that the execution of the present deed of amendment of the articles of association is subject to certain conditions precedent (the “Conditions Precedent”), which shall be conclusively

 

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evidenced by the delivery to the notary of a certificate, signed by an executive director of the Company, to the effect that the Conditions Precedent have been satisfied (the "Certificate"). The Certificate has been annexed to the present deed.

CONVERSION

In performance of the Conversion Resolution, the person appearing declares to convert the Company into a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid), within the meaning of Section 2:18 of the Dutch Civil Code.

AMENDMENT OF THE ARTICLES OF ASSOCIATION

[CurrentIn performance of the Amendment Resolution, the person appearing declares to amend the articles of association] as follows:

CHAPTER I

Definitions

Article 1.

In these Articles of association, the following terms shall have the following meaning:

-a. General Meeting: the corporate body of the Company constituting the general meeting of shareholders of the Company or a meeting of such corporate body;
-b. depositary receipts: depositary receipts for shares in the Company. Unless the context indicates otherwise, such receipts include depositary receipts issued with or without the Company's co-operation to which no meeting rights are attached;
-c. depositary receipt holders: holders of depositary receipts issued with the Company's co-operation. Unless otherwise stated such holders include persons who, as a result of any right of usufruct or right of pledge created on any share, have the rights conferred by law upon the holders of depositary receipts issued with the Company's co-operationmeeting rights;
-d. annual accounts: the balance sheet and profit and loss account plus explanatory notes and additional information thereto;
-meeting rights: means the right to, either in person or through a holder of a written power of attorney, attend a General Meeting and to address such General Meeting;
-e. subsidiary:
-          a legal entity in respect of which the Company or any of its subsidiaries, whether or not pursuant to an agreement with other persons entitled to vote, can exercise either individually or collectively, more than one-half of the voting rights at the general meeting of such entity;
-          a legal entity of which the Company or any of its subsidiaries are members or shareholders, and in respect of which the Company or any

 

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of its subsidiaries have, either individually or collectively, the right to appoint or dismiss more than half of such legal entity's directors or supervisory directors, whether or not pursuant to any agreement with other persons having voting rights, if all persons having voting rights in fact cast their vote;

-f. auditor: a registered accountant or any such other accountant as referred to in Article 2:393 of the Dutch Civil Code, or any organization in which such accountants co-operate;
g.regulated market: regulated market(s) or multilateral trading facility(/ies), as referred to in Article 1:1 of the Dutch Financial Supervision Act, where shares in the capital of the Company are admitted to trading, or any similar share trading market outside the European Union.

CHAPTER II

Name. Corporate seat. Objects

Article 2. Name and corporate seat

2.1.The name of the Company is Mobileye NB.V.
2.2.The Company has its corporate seat at Amsterdam, The Netherlands.

Article 3. Objects

The objects of the Company are:

a.to develop, manufacture and sell products for the automotive and transportation industries and/or vision-based technologies related to these products;
b.to incorporate, participate in and conduct the management of other companies and businesses;
c.to provide administrative, technical, financial, economic or managerial services to other companies, persons or businesses;
d.to acquire, sell, transfer, manage, develop and exploit real and moveable property and other goods, including patents, trademark rights, licenses, permits, knowhow and other industrial property rights;
e.to extend loans of money and/or to borrow money, and to provide security or guarantee the obligations of other parties in some other manner, or engage itself as jointly and severally liable along with or for other parties; and
f.to perform any and all activities of industrial, financial or commercial nature, with the above being either by itself or in collaboration with third parties and including performing and promoting any directly or indirectly related actions, all in the widest sense of the word/words.

CHAPTER III

Capital and shares. Register of shareholders

Article 4. Authorized capital

4.1.The authorized capital amounts to ten million one hundred twenty-five thousand six hundred fifty-seven euros and twenty-five eurocents (EUR

 

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10,125,657.25) and is divided into one billion twelve million five hundred sixty-five thousand seven hundred twenty-five (1,012,565,725) ordinary shares, each with a nominal value of one eurocent (EUR 0.01).

4.2.All shares shall be in registered form.
4.3.The shares may be divided into fractional shares (onderaandelen).
4.3.4.4. No share certificates shall be issued for shares.

Article 5. Register of shareholders

5.1.The Board of Directors shall keep, or cause to be kept, a register in which the names and addresses of all shareholders shall be recorded, specifying the date on which they acquired their shares, the date of acknowledgment by, or service upon the Company of notice of, the transaction by which such person became a shareholder, as well as the amount paid up on each share. The register shall also contain the names and addresses of all holders of a right of usufruct or pledge on shares, specifying the date on which they acquired such right, the date of acknowledgment by, or service upon the Company of notice of, such right and what rights such persons have been granted as referred to in ArticlesArticle 12 and Article 13.
5.2.With due observance of the relevant statutory provisions, the register shall be kept by or on behalf of the Company, shall be regularly updated and, at the discretion of the Board of Directors, may, in whole or in part, be kept in more than one copy and at more than one address.
5.3.Part of the register may be kept abroad in compliance with applicable laws or pursuant to the regulations of a regulated market to which shares are admitted to trading.

CHAPTER IV

Issue of shares. Own shares

Article 6. Issue of shares. Authorized corporate body

6.1.The Company shall only issue shares pursuant to a resolution of the General Meeting or of another corporate body designated to do so by a resolution of the General Meeting for a fixed period not exceeding five years. The designation must be accompanied by a stipulation as to the number of shares that may be issued. The designation may each time be extended for a period of up to five years. The designation may not be cancelled, unless the designation provides otherwise..
6.2.A decision by the General Meeting to issue shares or to designate another body to issue shares can only be taken upon the proposal of the Board of Directors.
6.3.Within eight days after the resolution of the General Meeting to issue shares or to designate a corporate body, the Company shall deposit a full text thereof at the trade register.
6.4.Within eight days after the end of each quarter, the Company shall notify the

 

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trade register of each issue of shares, stating the number of shares.

6.2.6.5. The provisions of ArticlesArticle 6.1 through 6.3 shall apply mutatis mutandis to the granting of rights to subscribe for shares, but shall not apply to the issue of shares to someone who exercises a previously existing right to subscribe for shares.

Article 7. Terms and conditions of issue. Pre-emptive rights

7.1.If a resolution to issue shares is adopted, the issue price of the shares and the other conditions of the issue shall also be determined in the resolution.
7.2.Each shareholder shall have a pre-emptive right with respect to any share issue in proportion to the aggregate nominal value of his shares, except if shares are issued for a non-cash consideration or if shares are issued to employees of the Company or of a group company.
7.3.The Company shall announce the issue of shares which are subject to pre-emptive rights and the period of time during which such rights may be exercised, in the Staatscourant (Official Gazette), in a Dutch national daily newspaper and further any other publication as required in accordance with the laws of the regulated market on which shares in the Company’s capital are admitted to trading. The previous sentence does not apply if all shareholders are notified in writing of a proposed issuance in respect of which pre-emptive rights are applicable at the address indicated by each of them in the shareholders register.
7.4.Pre-emptive rights may be exercised within at least two weeks after the day when the announcement in the Staatscourant (Official Gazette) was published or after the notification of the issuance was sent to the shareholders.
7.3.7.5. Pre-emptive rights may be restricted or excluded by a resolution of the General Meeting. The reasons for the exclusion of pre-emptive rights and the issue price of the shares to be issued without pre-emptive rights must be given in writing in the proposal to adopt such resolution. Pre-emptive rights may also be excluded or restricted by the authorized corporate body referred to in Article 6.1 if such corporate body is authorized by the resolution of the General Meeting for a fixed period, not exceeding five years, to restrict or exclude pre-emptive rights. The designation may each time be extended for a period of up to five years. Unless determined otherwise, the designation cannot be cancelled. Upon termination of the authority of the corporate body to issue shares, its authority to restrict or exclude pre-emptive rights shall also terminate.
7.4.7.6. A resolution of the General Meeting to restrict or exclude pre-emptive rights or to authorize a corporate body to restrict or exclude pre-emptive rights, shall require a majority of at least two-thirds of the votes cast if less than one-half of the issued capital is represented at the General Meeting. Within eight days

 

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after the resolution, the Company shall deposit the full text thereof at the trade register.

7.5.7.7. Upon the granting of rights to subscribe to shares, the shareholders shall have a pre-emptive right. The provisions of the previous paragraphs of this Article shall apply mutatis mutandis to the granting of rights to subscribe to shares. Shareholders shall have no pre-emptive rights in respect of shares issued to a person who exercises a right to acquire shares granted to him at an earlier date.

Article 8. Payment for shares. Payment in cash. Non-cash Contribution

8.1.Upon the issue of each share, the nominal value must be fully paid up, and, in addition, if the share is subscribed for at a higher amount, such amount must be fully paid. It may be stipulated that a part, not exceeding three quarters of the nominal value, needsor part thereof, need only be paid after such part is called up by the Company.
8.2.Payment for shares shall be made in cash unless a non-cash contribution has been agreed. Payment in foreign currency may only be made with the Company's approval. If payment is made in foreign currency, the payment obligation shall be considered fulfilled up to the Netherlands currency amount into which the foreign currency can be freely converted. The basis for determination shall be the rate of exchange on the day of payment. If the shares or depositary receipts will without delay, upon issue, be admitted to trading on a regulated market outside The Netherlands, the Company may demand that payment be made based on the rate of exchange on a fixed day within two months before the last day on which payment must be made. If payment is made in foreign currency, a banker's statement as referred to in Article 2:93a paragraph 2 of the Dutch Civil Code shall be deposited at the trade register within two weeks after payment.
8.3.The Board of Directors is authorized to enter into an agreement relating to payment for shares other than in cash. In accordance with Article 2:94204b paragraph 1 of the Dutch Civil Code, a description shall be drawn up of the contribution to be made.
8.4.An auditor as mentioned in Article 2:393 paragraph 1 of the Dutch Civil Code shall issue a statement on the description of the contribution to be made.
8.5.The provisions set out in this Article relating to the description and auditor's statement shall not apply to the cases referred to in Article 2:94b paragraph 3 or paragraph 5 of the Dutch Civil Code.
8.4.8.6. The Board of Directors is authorized to take actions as specified in Article 2:94204 of the Dutch Civil Code without approval of the General Meeting.

Article 9. Own shares. Financial assistance

9.1.The Company may not subscribe for its own shares, or depositary receipts

 

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therefor, upon the issue thereof.

9.2.The Board of Directors resolves on the acquisition of shares in the capital of the Company. The acquisition by the Company of shares in its own capital when those shares have not been fully paid up shall be null and void.
9.3.9.2. The Company may only acquire fully paid up shares in its own capital, or depositary receipts therefor, without consideration or if:
a.its shareholders equity, determined as set forth in Article 9.3, less the acquisition price, is not less than the sum of the paid and called up part of its capital and the reserves, which must be maintained by law or under the Articles, and
b.the nominal amount of the shares in its capital or depositary receipts thereof which the Company acquires, holds, holds as pledgee or which are held by a subsidiary company, is not more than one half of the Company’s issued capital. Board of Directors neither knows or should reasonably foresee that the Company upon acquisition will not be able to continue paying its debts when they become due.
9.3.The validity of the acquisition shall be determined on the basis of the amount of the Company's equity according to the most recently adopted balance sheet decreased with the acquisition price of shares in the Company's capital or depositary receipts, the amounts of loans referred to in Article 98c, paragraph 2 of the Dutch Civil Code and any distributions to others out of profits or reserves which became payable by the Company and its subsidiaries after the date of that balance sheet. If more than six months have elapsed since the expiration of a financial year without adoption of the annual accounts for that year, an acquisition in accordance with the provisions of Article 9.2 is not permitted.
9.4.The Board of Directors shall require the authorization of the General Meeting for an acquisition other than for no consideration. Such authorization resolution of the General Meeting shall be valid for a maximum period of eighteen months. In the authorization resolution, the General Meeting shall determine (i) the number of shares (including depositary receipts) that may be acquired, (ii) how the shares (including depositary receipts) may be acquired and (iii) the limits of the share prices within which shares (including depositary receipts) may be acquired.
9.5.The authorization resolution of the General Meeting, as referred to in Article 9.4, is not required to the extent the Company acquires its own shares or depositary receipts admitted to trading on any regulated market, in order to transfer such shares or depositary receipts to employees of the Company or of a group company, pursuant to a scheme applicable to such employees.
9.6.The Company may not with a view to any other party subscribing to or acquiring the Company's shares or depositary receipts, provide security or any price

 

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guarantee, act as surety in any other manner, or bind itself jointly and severally or otherwise in addition to or on behalf of others. This prohibition shall also apply to its subsidiaries.

9.7.The Company and its subsidiaries may not grant loans with a view to subscribing for its own shares or depositary receipts therefor or any other party acquiring shares in the capital of the Company or depositary receipts therefor, unless the Board of Directors passes a resolution to that effect and the conditions of Article 2:98c paragraphs 2 up to and including 7 of the Dutch Civil Code are fulfilled. This prohibition shall not apply if shares or depositary receipts therefor are subscribed for or acquired by employees of the Company or a group company.
9.8.Shares in the Company's capital and depositary receipts therefor may, upon issue, not be subscribed for by or on behalf of any of the Company’s subsidiaries. The subsidiaries may acquire such shares or depositary receipts for their own account only insofar as the Company is permitted to acquire its own shares or depositary receipts pursuant to Articles 9.2 up to and including 9.5.
9.4.9.9. Disposition of any of the Company’s own shares or depositary receipts held by the Company shall require a resolution of the General Meeting provided that the General Meeting has not granted the authority to issue shares to another corporate body, in which case that other corporate body shall also be authorized to dispose of shares or depositary receipts in the Company’s own capital held by the Company. Pre-emptive rights are not applicable to any disposition of shares or depositary receipts pursuant to this Article 9.9.9.4.
9.5.9.10. The Company may not cast votes in respect of the Company’s own shares that are held by the Company or in respect of the Company’s own shares on which the Company has a right of usufruct or pledge. Nor may any votes be cast by the pledgee or usufructuary of the Company’s shares that are held by the Company if the right of pledge or usufruct was created by the Company. No votes may be cast in respect of the shares in respect of which depositary receipts are held by the Company. The provisions of this paragraph shall also apply to shares or depositary receipts held by any subsidiary or in respect of which any subsidiary holds a right of usufruct or pledge.
9.6.9.11. When determining to what extent the Company's capital is represented, or whether a majority represents a certain part of the capital, the shares for which no votes can be cast shall be disregarded.
9.7.After the acquisition of its own shares at least one share with voting rights shall be held by and on behalf of someone other than the Company or one of its subsidiaries.

 

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Article 10. Capital reduction

10.1.At the proposal of the Board of Directors theThe General Meeting may, with due observance of the relevant statutory provisions, resolve to reduce the issued capital by a cancellation of shares held by the Company or by amending the articles of association to reduce the nominal amount of the shares. Such resolution should not lead to repayment at the expense of reserves which should be maintained in accordance with Dutch law.
10.2.For a resolution to reduce the capital, a majority of at least two-thirds of the votes cast shall be required if less than one-half of the issued capital is represented at the meeting.
10.3.After the cancellation of shares at least one share with voting rights should be held by and on behalf of someone other than the Company or one of its subsidiaries.
10.4.10.3. The convening notice calling a General Meeting at which a motion for capital reduction is proposed, shall specify the purpose of the capital reduction as well as the method of reduction.
10.5.Article 25.3 shall apply mutatis mutandis to a resolution to reduce the issued capital with repayment on shares.

CHAPTER V

Transfer of shares. Restriction on the Transfer of Shares. Usufruct. Pledge.

Article 11. Transfer of shares. Restriction on the Transfer of Shares.

11.1.The transfer of shares shall require a deed intended for that purpose, and also, except if the Company itself is a party to that legal act,a share can only be effected by way of a notarial deed to that effect, executed before a civil-law notary practicing in the Netherlands, to which deed all persons involved are a party, followed by a written acknowledgement of the transfer by the Company unless the Company itself is a party to the deed.
11.2.The provisions of Article 11.1 shall also apply to the allotment of shares in the event of a partition of any jointly held property, to the transfer of a share as a consequence of foreclosure of a right of pledge, to the creation, surrender andor transfer of a right of usufruct on a share, and to the creation andor surrender of a right of pledge on a share.
11.3.Prior to [DATE OF EXECUTION OF DEED OF AMENDMENT], no restriction as referred to in article 2:195 paragraph 1 of the Dutch Civil Code applies to the transfer of shares in the capital of the Company. The restrictions set forth in Articles 11.4 through 11.10 below apply to each transfer of any shares acquired after [DATE OF EXECUTION OF DEED OF AMENDMENT], but not to any other transfer of shares.
11.4.Any share acquired by a shareholder on any day after [DATE OF EXECUTION OF DEED OF AMENDMENT] cannot be transferred prior to the first day of March two thousand and nineteen (the "lock-up period"), unless the Board of

 

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Directors has approved the proposed transfer. The restriction on the transfer of shares laid down in this Article 11.4 shall not apply if and to the extent a shareholder must transfer its share to a previous holder pursuant to the law. For purposes of this Article 11.4 up to and including Article 11.10, a share shall be deemed to include a right to subscribe for new shares.

11.5.An approval as described in Article 11.4 shall be applied for by way of a letter addressed to the Company for the attention of the Board of Directors, setting out the name of the applying shareholder, the number of shares for which a decision is sought, any share numbers, and the name of the person to whom the applicant wishes to transfer the shares, as well as any ultimate beneficial owner of such proposed transferee.
11.6.The request is deemed to have been approved if:
-               the applicant has not been informed of a decision within three months of the receipt of the request; or
-               together with a rejection of the application, the applicant is not notified by the Board of Directors of one or more prospective purchaser(s) willing and able to purchase for cash all of the shares with respect to which transfer approval was sought.
11.7.In the event that the approval is granted or is deemed to have been granted, the applicant is free to transfer its shares with respect to which such approval was granted for a period of three months after the receipt of a notice, duly signed on behalf of the Company, that the approval has been granted or is deemed to have been granted, or after the period referred to in Article 11.6 has expired.
11.8.The Company itself may be a prospective purchaser only after obtaining the consent of the applicant.
11.9.The price against which the prospective purchaser(s) designated by the Board of Directors may purchase the shares, shall be the fair market value of the shares as determined by the Board of Directors in its sole discretion.
11.10.As of the first day of March two thousand and nineteen, no restriction as referred to in article 2:195 paragraph 1 of the Dutch Civil Code shall be applicable to the transfer of shares in the capital of the Company.

Article 12. Usufruct

12.1.A shareholder may freely create a right of usufruct on one or more of histhe shares it holds.
12.2.The shareholder shall havehold the voting rights attached to the shares on which thea right of usufruct has been establishedvested.
12.3.In deviation from Article 12.2, the usufructuary shall hold the voting rights shall be vested in the usufructuary if such is determined upon theattached to the shares on which a right of usufruct has been vested if so agreed and provided at the time of creation of the right of usufruct., or at a later time when this is

 

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agreed on in writing between the shareholder and the usufructuary. With respect to shares acquired by a shareholder after [DATE OF EXECUTION OF DEED OF AMENDMENT] an agreement as referred to in the previous sentence can only be agreed and laid down among the parties concerned after the lock-up period as defined in Article 11.4 has expired, unless in case of a usufruct referred to in article 4:19 and 4:21 of the Dutch Civil Code, in which case article 2:197 paragraph 3 of the Dutch Civil Code shall apply.

12.4.TheA shareholder without voting rights and thea usufructuary with voting rights shall have the rights conferred by law upon a holder of depositary receipt holders. Thereceipts with meeting rights. A usufructuary without voting rights shall also have such rights unless these are withheld from such person upon the creation or transfer of the usufructnot hold any meeting or other such rights.

Article 13. Pledge

13.1.A shareholder may create a right of pledge on one or more of histhe shares it holds.
13.2.The shareholder shall havehold the voting rights attached to the shares on which thea right of pledge has been establishedvested.
13.3.In deviation from Article 13.2, the pledgee shall hold the voting rights shall be vested in the pledgee if such isattached to the shares on which a right of pledge has been vested if so agreed and provided uponat the time of creation of the pledgeright of pledge, whether or not subject to a condition precedent, or at a later time when this is agreed on in writing between the shareholder and the pledgee. With respect to shares acquired by a shareholder after [DATE OF EXECUTION OF DEED OF AMENDMENT] an agreement referred to in the previous sentence can only be agreed and laid down among the parties concerned after the lock-up period as defined in Article 11.4 has expired.
13.4.TheA shareholder without voting rights and thea pledgee with voting rights shall have the rights conferred by law upon a holder of depositary receipt holders. Pledgeesreceipts with meeting rights. A pledgee without voting rights shall also havenot hold any meeting or other such rights unless these are withheld from them upon the creation or transfer of the pledge.
13.5.If a pledge is created without acknowledgement by or service on the Company, the rights pursuant to the provisions of this Article 13 shall vest in the pledgee only after the pledge has been acknowledged by, or notice thereof has been served on, the Company.

CHAPTER VI

Board of Directors

Article 14. Board of Directors.

14.1.The Board of Directors shall be in charge of managing the Company, subject to the restrictions set forth in these Articles of Association, in particular those

 

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relating to the allocation of responsibilities between the executive directors and the non-executive directors.

14.2.In performing their duties, the directors shall act in accordance with the interest of the Company and the business connected to it.

Article 15. Appointment.

15.1.The Board of Directors shall consist of one or more executive directors and one or more non-executive directors. The executive directors and the non-executive directors are hereinafter jointly also referred to as the “directors”.

The Board of Directors shall initially, as of the date of execution of this deed of amendment, subject to the provisions of the following sentence, consist of seven (7) persons, of whom two (2) shall be executive directors and five (5) shall be non-executive directors. The total number of directors, the total number of executive directors and the total number of non-executive directors, shall be laid down in, and may be increased or decreased pursuant to a resolution of the Board of Directors approved by a majority vote of all of the executive directors, and a majority vote of all of the non-executive directors, then in office, the General Meeting. A decrease in the number of directors, or in the number of executive or non-executive directors, shall not result in a decrease in the term of office of any director in office at the time of such decrease in the number of directors. Only natural persons can be directors.

15.2.The non-executive directors shall supervise the fulfilment of their duties by the executive directors and shall supervise the general affairs of the Company. The executive directors are responsible for the day-to-day management of the Company, in accordance with general policies adopted from time to time by the Board of Directors. Non-executive directors shall be involved in the day-to-day management of the Company only in relation to those matters specifically assigned to non-executive directors or to the Board of Directors as a whole pursuant to these Articles of Association or the corporate governance guidelines (reglement) of the Board of Directors, and only to the extent specifically so entrusted by these Articles of Association and the corporate governance guidelines to the non-executive directors or the Board of Directors as a whole.
15.3.The executive directors shall comply with any specific instructions given to them by the Board of Directors as a whole.
15.4.No non-executive director shall be obligated to take any steps to prevent any actual or alleged mismanagement (onbehoorlijke taakvervulling) of the Company and its subsidiaries except if and to the extent that the relevant non-executive director has actual knowledge of, or, after exercise of reasonable inquiry consistent with his duties as a non-executive director of the Company, should have had knowledge of, the facts constituting such actual or

 

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alleged mismanagement.

15.5.The executive directors and non-executive directors shall be appointed by the General Meeting. A director shall be designated by the General Meeting as an executive director or a non-executive director at the time of his election to the Board of Directors.
15.6.Except as otherwise provided in this Article 15.6, the directors shall serve for a term of three (3) years from the date of their election until the end of the annual General Meeting held in the third year following their election. However, (i) the initial term of office of the executive directors serving as such immediately prior to the execution of this deed of amendment shall expire at the end of the annual General Meeting held in the year two thousand fifteen and (ii) the initial term of office of the non-executive directors serving as such immediately prior to the execution of this deed of amendment shall expire at the end of the annual General Meeting held in the year two thousand sixteen. The Board of DirectorsThe General Meeting may, at the time of its proposal to the General Meeting to elect a new director is elected to fill a vacancy as a consequence of a change in the number of directors, or otherwise, determine that a particular newly elected director will serve for a shorter or longer term than three (3) years to ensure that the terms of office of approximately one-third of the members of the Board of Directors expire each year.
15.7.The Board of Directors shall appoint one of its non-executive members to be its Presiding Director (voorzitter) for such period as the Board of Directors may decide. The Presiding Director presides at the meeting of the Board of Directors.
15.8.The Board of Directors may designate one of the executive directors as Chief Executive Officer and one of the executive directors as Chairman of the Company.
15.9.Except as otherwise permitted by Article 132242a of Book 2 of the Dutch Civil Code, a director may hold a maximum of two (2) memberships of supervisory boards and/or non-executive board memberships of Dutch limited liability companies (naamloze vennootschappen), Dutch private companies with limited liability (besloten vennootschappen met beperkte aansprakelijkheid) and Dutch foundations (stichtingen) which do not meet at least two of the statutory requirements as laid down in Article 2:397 paragraph 1 and 2 Dutch Civil Code (or, in the case of a foundation, Article 297a, paragraph 1, of the Dutch Civil Code), taking into account that the chairmanship of a supervisory board or of a Board of Directors, in case the board is divided into executive and non-executive directors, counts twice for these purposes.
15.10.The appointment of a member of the Board of Directors in itself does not constitute an employment contract (arbeidsovereenkomst) between the

 

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member of the Board and the Company. An employment contract between the Company and a director is prohibited.

Article 16. Suspension and dismissal.

16.1.The General Meeting shall at all times have the power to suspend or dismiss each director, provided that the resolution is passed by a majority of no less than two-thirds of the votes cast, which vote also represents more than one-half of the Company’s issued capital.

The Board of Directors as a whole shall also have the power to suspend each executive director.

16.2.Any such suspension may be extended several times but the total term of the suspension may not exceed three (3) months. The suspension shall expire at the end of this period if no resolution has been adopted either to lift the suspension or to dismiss the director.

Article 17. Compensation.

17.1.The Company shall have a policy regarding the compensation of the Board of Directors. The compensation policy shall be adopted by the General Meeting upon the proposal of the Board of Directors and may only be amended by the General Meeting pursuant to a proposal of the Board of Directors. The compensation policy shall contain at least the items as set forth in Article 2:383c up to and including Article 2:383e of the Dutch Civil Code, to the extent that these relate to the directors.
17.2.The compensation and the other terms and conditions of service of each executive director are determined by the non-executive directors acting by a majority vote of all non-executive directors in office, with due observance of the compensation policy. The compensation of the non-executive directors is determined by the General Meeting pursuant to a proposal of the Board of Directors.
17.3.A proposal for the compensation of directors in the form of shares or rights to acquire shares shall be submitted by the Board of Directors to the General Meeting for approval. Approval of option or share grants to directors may also cover all future grants by the Board of Directors or a committee thereof under present and future equity incentive plans approved by the Board of Directors from time to time, within the limits of the shares available for grant under such plans from time to time.

Article 18. Decision-making. Division of duties.

18.1.The Board of Directors shall meet as often as any two directors may deem necessary.
18.2.In the meeting of the Board of Directors each director has a right to cast one vote. Except as specifically provided herein, all resolutions by the Board of Directors shall be adopted by an absolute majority of the votes cast in a

 

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meeting at which a majority of the directors is present or represented. If there is a tie in votes, the proposal will be rejected. Matters that are specifically entrusted to the non-executive directors as a group pursuant to these Articles or the provisions of Dutch law shall be decided by a majority vote of all non-executive directors in office at the time of the relevant decision.

18.3.A director may grant another director a written proxy to represent him at a particular meeting indicated in such proxy.
18.4.Resolutions of the Board of Directors may be adopted in writing – including any electronic message and facsimile, or in the form of a message transmitted by any accepted means of communication and received or capable of being produced in writing – by all directors in office who are entitled to vote on the relevant resolution provided that all directors are familiar with the resolution to be passed and none of them objects to this decision-making process.
18.5.The Board of Directors may adopt rules and regulations governing its decision-making process.
18.6.Subject at all times to the provisions of Articles 15.1 up to and including 15.4, the Board of Directors may make a division of duties, specifying the individual duties of every director.
18.7.Subject to the provisions of Article 18.8, a director shall not take part in any discussion or decision-making in respect of which such director has directly or indirectly personally a conflict of interest with the Company and the business connected to it.
18.8.If no resolution can be adopted by the Board of Directors as a result of Article 18.7 because all directors have a conflict of interest, the Board of Directors shall nonetheless be authorized to adopt a resolution and those directors who have a conflict of interest shall be entitled to vote on such resolution.
18.9.The executive directors shall timely provide the non-executive directors with any such information as may be necessary for the non-executive directors to perform their duties or as may be requested from time to time by any non-executive directors.
18.10.The Board of Directors may establish such committees as it may deem necessary. The Board of Directors appoints the members of each committee and determines the tasks of each committee. The Board of Directors may at any time change the duties and the composition of a committee.

If the Board of Directors consists of more than four (4) non-executive directors, the Board of Directors must establish at least an audit committee, a compensation committee and a nominating and corporate governance committee.

The Board of Directors shall draw up charters governing each committee’s internal affairs.

 

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Article 19. Representative authority.

19.1.The Board of Directors shall represent the Company. The authority to represent the Company shall also be vested in each executive director individually. For the avoidance of doubt, the non-executive directors shall have no authority to represent the Company individually except as provided in Article 22 in the case of absence or inability to act of all executive directors.
19.2.The Board of Directors may appoint officers and grant them a general or special power of attorney. Their titles shall be determined by the Board of Directors. Every attorney in fact shall represent the Company within the bounds of his or her authorization.

Article 20. Approval of executive director actions.

20.1.The Board of Directors may resolve that specific actions by the executive directors must be approved in advance by a resolution of the Board of Directors. All such resolutions subjecting actions of the executive directors to the prior adoption of a resolution of the Board of Directors shall be in writing and notified to the executive directors. The absence of approval by a Board resolution as meant in this Article 20.1 does not affect the representative authority of the executive directors.
20.2.Without prejudice to the other provisions in these Articles of Association, the approval of the General Meeting shall be required for decisions by the Board of Directors leading to an important change in the Company’s or its business enterprise’s identity or character, including in any case:
a.the transfer of the business of the Company or almost the entire business of the Company to a third party;
b.the entering into or termination of any long-term co-operative arrangement between the Company or any subsidiary of the Company and another legal entity or company, or as a general partner in a limited or general partnership, if such cooperative arrangement or termination is of substantial significance for the Company;
c.the disposal of a participation in the capital of a company with a value of at least one-third of the amount of the Company’s assets according to the Company’s consolidated balance sheet, forming part of the most recently adopted annual accounts of the Company; or
d.the acquisition of a participation in the capital of a company with a value of at least one-third of the amount of the Company’s assets according to the Company’s consolidated balance sheet, forming part of the most recently adopted annual accounts of the Company.

Article 21. Conflicts of interests.

Resolutions to enter into transactions in which there is a conflict of interest with any of the directors can only be taken in accordance with the provisions of Articles 18.7 and 18.8.

 

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Article 22. Absence or inability to act.

If an executive director is absent or unable to act, the remaining executive director(s) shall be temporarily charged with the management of the Company. If the sole executive director is, or all executive directors are, absent or unable to act, the following shall apply: The Board of Directors may designate one or more executive officers of the Company who shall be charged with the day-to-day management of the Company, under the supervision of the Board of Directors, during the absence or inability to act of all executive directors, and each such executive officer shall be authorized to represent the Company during the absence or inability to act of all executive directors. During the absence or inability to act of all executive directors, either (i) the Board of Directors, or (ii) any executive officer designated by a resolution of the Board of Directors as set forth in the preceding sentence, acting with the approval of the Board of Directors, may call a General Meeting to fill the vacancy created by the absence or inability to act of all executive directors, if such absence or inability to act of all executive directors continues for thirty (30) days or more. In the absence of a resolution adopted by the Board of Directors as described in the two preceding sentences charging one or more executive officers of the Company with the day-to-day management of the Company during the absence or inability to act of all executive directors, the non-executive directors shall be temporarily charged with the management of the Company during the absence or inability to act of all executive directors and each non-executive director shall be entitled to represent the Company during such absence or inability to act of all executive directors.

If all directors are absent or unable to act, then the executive officers of the Company shall be charged with the management of the business of the Company, and each such executive officer shall be entitled to represent the Company during the absence or inability to act of all directors and any executive officer may call a General Meeting to fill the vacancies in the Board of Directors. If no executive officer calls a General Meeting for such purpose within thirty (30) days after the first date when all directors were absent or unable to act, then any holder(s) of one percent (1%) or more of the Company’s issued capital may call a General Meeting for such purpose.

CHAPTER VII

Annual accounts. Profits

Article 23. Financial year. Drawing up the annual accounts

23.1.The Company’s financial year shall be concurrent with the calendar year.
23.2.The Board of Directors shall prepare the annual accounts, within five (5) months of the end of each financial year, unless such period is extended in accordance with the provisions of applicable law.
23.3.Within the period for preparation thereof, as referred to in Article 23.2, the annual accounts shall also be made available to the public to the extent

 

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required by law. Furthermore, theThe annual financial information shall be available at the offices of the Company. If requested, the Company shall provide to those entitled to attend meetings copies of the annual financial information free of charge. If these documents are amended, this obligation shall also extend to the amended documents.

23.4.The annual accounts shall be signed by all members of the Board of Directors. If the signature of one or more of them is lacking, this fact and the reason therefor shall be indicated.
23.5.The annual accounts shall be adopted by the General Meeting.
23.6.After adoption of the annual accounts, the General Meeting may by separate agenda items discharge the executive directors, in respect of their management of the Company, and the non-executive directors in respect of their supervision of the Company’s management and their management of the Company to the extent that the non-executive directors have been involved in the management of the Company as set forth herein, in each case during the relevant financial year insofar as this appears from the annual accounts or otherwise is apparent from public disclosures.
23.7.The Company shall be obligated to deposit the annual accounts within eight days after adoption thereof at the office of the trade register.

Article 24. Auditor

24.1.The General Meeting shall instruct an accountant to audit the annual accounts and the annual report, as drawn up by the Board of Directors, to report thereon and to issue an auditor’s certificate with respect thereto. If the General Meeting fails to instruct an external auditor, the Board of Directors shall be authorized to do so. The annual accounts shall not be adopted by the General Meeting if the General Meeting is not able to take cognizance of the auditor’s certificate, unless a legitimate ground is given why the certificate is lacking.
24.2.The compensation of the external auditor, and instructions to the external auditor to provide non-audit services, shall be approved by the Board of Directors.
24.3.The auditor shall record his findings in a report commenting on the true and fair nature of the annual accounts. The auditor shall send such report to the Board of Directors.
24.4.The external auditor may be questioned by the General Meeting in relation to his statement on the fairness of the annual accounts. The external auditor shall therefore attend and be entitled to address this meeting.

Article 25. Allocations of profit

25.1.The Board of Directors shall determine which portion of the profits shall be reserved. The profit remaining after application of the previous sentence, if any, shall be at the disposal of the General Meeting. A resolution to pay a dividend

 

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shall be dealt with as a separate agenda item at the General Meeting.

25.2.The Company may make distributions to the shareholders and other persons entitled to the distributable profits only to the extent that the Company’s shareholders’ equity exceeds the sum of the paid-in capital and the reserves which it is required by law to maintain.
25.3.Distribution of profit shall be effected after the adoption of the annual accounts which show that this is permitted.A resolution to make a distribution has no effect until the Board of Directors has granted approval for such resolution. The Board of Directors shall refuse this approval only if it knows or should reasonably foresee that the Company will be unable to continue to pay its short-term debts after the distribution.
25.4.The Board of Directors may make interim distributions only to the extent that the requirements set forth in Article 25.2 above are satisfied, as apparent from an (interim) financial statement drawn up in accordance with the law.
25.5.The Board of Directors may decide to make payments to holders of shares out of reserves which are not required to be maintained by law or these Articles of Association, if such payment is permitted by Article 25.2.
25.4.25.6. Any claim a shareholder may have to a distribution shall lapse after five (5) years, to be computed from the day on which such a distribution becomes payable.
25.5.25.7. A dividend or other distribution may be payable in cash or other property, including shares in the capital of the Company.
25.8.The Board of Directors may determine a record date for the payment of a dividend or other distribution, which shall not be earlier than sixty (60) days before the date of payment of such dividend or other distribution. If the Board of Directors determines a record date for the payment of a dividend or other distribution, only the shareholders of the Company as of such record date shall be entitled to receive the relevant dividend or other distribution, and only in respect of those shares held by such shareholders on such record date.
25.9.The timing and method of payment of a dividend or other distribution shall be determined by the Board of Directors in accordance with applicable laws and regulations in the resolution for the declaration (betaalbaarstelling) of such dividend or other distribution.

CHAPTER VIII

General meetings

Article 26. Annual General Meeting

26.1.Within six (6) months of the end of the Company's financial year the annual General Meeting shall be held.
26.2.The agenda of that meeting shall, among other matters, contain the following items:

 

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a.discussion of the annual report;
b.adoption of the annual accounts;
c.discharge of the executive directors and non-executive directors for their management and/or supervision of management, as more fully set forth in Article 23.6, during the past financial year;
d.appropriation of profits for the preceding year;
e.filling of any vacancies in the Board of Directors.

Article 27. Other General Meetings

27.1.Within three months after the Board of Directors considers it likely that the equity of the Company has decreased to an amount equal to or less than half of the paid and called up part of the Company’s capital, a General Meeting shall be held to discuss the measures to be taken, if necessary.
27.1.27.2. Without prejudice to the provisions of Articles 26.1, 27.126.1 and Article 22, General Meetings shall be held as often as the Board of Directors deems necessary.

Article 28. Convocation. Agenda

28.1.General Meetings shall be called by the Board of Directors.
28.2.Notice of the meeting shall be given not later than on the fifteentheighth day prior to the day of the meeting.
28.3.The convening notice shall specify the items to be discussed. Items which have not been specified in the convening notice may also be put on the agenda of the meeting with due observance of the notice requirements of Article 28.2.
28.4.The agenda shall contain such matters as may be placed thereon by the Board of Directors. Furthermore, the agenda shall contain such items as requested in writing by one or more persons entitled to attend the General Meeting, representing solely or jointly at least threeone percent (31%) of the Company’s issued capital, at least sixty (60) days before the date of the meeting. The meeting shall not adopt resolutions on matters other than those that have been placed on the agenda.
28.5.Notifications of the General Meetings, and all other notifications required by law to be given to shareholders and depositary receiptthe holders of meeting rights, shall be given by an announcement published through the Company’s website and via any other electronic communication method that is directly and permanently accessible until the General Meeting and by mail directed to the shareholders at their addresses shown on the shareholders register, or by email addressed to the email address which a shareholder has indicated in writing to the Company, as well as via such announcements as may be required pursuant to the laws and regulations of each jurisdiction in which the shares of the Company have been admitted to trading on a regulated market. . Notice delivered by mail shall be effective when it is placed in the post, postage

 

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prepaid, addressed to the relevant shareholder at his address as shown in the shareholders register.

Article 29. Place of the meetings

General Meetings shall be held in the following places in The Netherlands: Amsterdam, The Hague, Rotterdam or Haarlemmermeer (Schiphol Airport). In a meeting held elsewhere, valid resolutions can only be taken if the entire issued capital is represented(i) all persons with meeting rights have declared to consent to the place of the meeting, and (ii) the director(s) has (have) had the opportunity to provide advice prior to the adoption of resolutions. The convening notice shall state the place where the General Meeting shall be held.

Article 30. Imperfect convocation General Meeting

Valid resolutions in respect of matters which were not mentioned on the agenda in the notice of meeting, or which have not been properly published, or in respect of which there has been no due observance of the period set for notice, can only be taken by unanimous votes in a meeting where the entire issued capital is represented, provided that (i) all persons with meeting rights have declared to consent that adoption of resolutions shall take place, and (ii) the director(s) has (have) had the opportunity to provide advice prior to the adoption of resolutions.

Article 31. Chairman

31.1.The General Meetings shall be chaired by the Presiding Director of the Board of Directors. If the Presiding Director of the Board of Directors is not present at a meeting, the meeting shall be chaired by another non-executive director designated by the Board of Directors.
31.2.If no chairman for a meeting has been appointed in accordance with Article 31.1, the meeting shall appoint its chairman itself.

Article 32. Voting results / Minutes

32.1.The voting results for each resolution adopted at a General Meeting, including (i) the number of shares that have been validly voted upon, (ii) the number of shares that have been validly voted upon as a percentage of the issued share capital, (iii) the total number of votes validly cast and (iv) the number of votes cast in favor of and against the resolution as well as the number of abstentions, must be posted on the Company’s website not later than the fifteenth day following the day of the General Meeting.
32.1.32.2. Minutes shall be taken of the matters discussed at every General Meeting by a secretary to be appointed by the chairman of the meeting.
32.3.The minutes of the General Meeting shall be made available on the Company’s website no later than three months after the end of the meeting.
32.2.32.4. The minutes shall be adopted by the chairman and the secretary of the meeting and signed by them to that effect three months after the minutes have been made available on the Company’s website.

 

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32.5.The chairman of the meeting, or the person who requested the meeting, may decide that an official notarial report should be drawn up of the matters discussed at the meeting. This report must be co-signed by the chairman of the meeting.

Article 33. Rights exercisable during a meeting. Admission

33.1.Every holder of shares and every other party entitled to attend the meeting who derives his rights from such shares, is only entitled to attend the General Meeting in person, or represented by a person holding a written proxy, to address the meeting and, in as far as he has voting rights, to vote at the meeting, if he has lodged documentary evidence of his voting rights or meeting rights within a time and in a manner specified by the Board of Directors in the notice of meeting. Such time may not be earlier than seven days before the date of the meeting. The requirement of a written proxy is also met if the proxy is recorded electronically.
33.2.In terms of applying the provisions of Article 33.1, the Board of Directors may determine that those entitled to vote and/or attend the meeting shall be those who (i) are a shareholder or otherwise entitled to attend the meeting on the twenty-eighth day before the General Meeting (“record date”) and (ii) are registered as such in a register (or one of more parts thereof) designated by the Board of Directors, hereinafter referred to as “the register”. If the Board of Directors sets a record date, it must be the date which is exactly twenty-eight (28) days before the date of the General Meeting and not an earlier or later date.
33.3.The convocation to the General Meeting shall state the record date, where and the manner in which registration shall take place, and the procedure(s) to participate and exercise voting rights in the General Meeting (including procedures for persons holding a written proxy for a shareholder or other person entitled to attend the meeting). The convocation may also provide that (i) shareholders or other persons entitled to attend the meeting may participate in the meeting, cast votes at the meeting and/or speak at the meeting, directly or through the holder of a written proxy, by way of an electronic means of communication designated in the convocation provided that such means of communication satisfies the conditions set forth in Article 2:117a, paragraph 2, of the Dutch Civil Code and/or (ii) that votes cast in advance of the meeting, on or after the record date in respect thereto, by means of an electronic means of communication as specified in the convocation, will be deemed to have been cast at the meeting.
33.4.The chairman of the General Meeting shall decide whether persons other than those who are entitled to admittance pursuant to the aforementioned provisions shall be admitted to the meeting.

 

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33.2.33.5. The attendance list must be signed by each person with voting rights and/or meeting rights or his representative.
33.3.33.6. The members of the Board of Directors shall have the right to attend the General Meeting. In these meetings they shall have an advisory vote.

Article 34. Decision making by General Meeting

34.1.The Board of Directors shall provide the General Meeting with all information that it requires, unless this would be contrary to an overriding interest of the Company. In the event of such an overriding interest, the Board of Directors shall give the reason for withholding information.
34.2.Resolutions of the General Meeting shall be passed by an absolute majority of the votes cast, unless the law or these Articles of Association prescribe a greater majority.
34.3.The General Meeting may only adopt the following resolutions upon a proposal by the Board of Directorswith the special majority set out below:
a.a resolution to amend the Articles of Association of the Company;
b.a resolution to effect a legal merger (juridische fusie) or demerger (juridische splitsing);
c.a resolution to liquidate or dissolve the Company;
d.a resolution to take one of the actions referred to in Article 20.2.

Any resolution to take any of the actions described in paragraphs a. through c. above, or in Article 20.2.a. through c., can only be adopted by a majority of no less than two-thirds of the votes cast, which vote also represents more than one-half of the Company’s issued capital. In addition, any resolution to approve the acquisition of a participation in the capital of a company, as referred to in Article 20.2.d., must be adopted by a majority of not less than two-thirds of the votes cast, which vote also represents more than one-half of the Company’s issued capital, if the acquisition has a value of twenty percent (20%) or more of the Company’s Total Market Capitalization at the date of the entering into by the Company of the definitive agreement for such acquisition. As used herein the term “Total Market Capitalization” of the Company as of any date shall mean (i) the total number of the Company’s issued and outstanding ordinary shares as of such date multiplied by (ii) the Closing Price of an ordinary share of the Company as of such date. As used herein the term “Closing Price” of an ordinary share of the Company as of any date shall mean the average closing price of an ordinary share of the Company on the principal securities exchange or interdealer quotation system where the Company’s ordinary shares are then traded, during a period of up to thirty (30) trading days prior to such date, which period shall be determined by the Board of Directors.amount of the Company’s assets according to the Company’s consolidated balance sheet, forming part of the most recently adopted annual accounts of the Company.

 

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34.4.If no absolute majority is reached by a vote taken with respect to the election of persons, a second vote shall be taken whereby the voters are not required to vote for the previous candidates. If, again, no one has gained an absolute majority of the votes, new votes shall be held until either one person has gained an absolute majority or, if the vote was between two persons, the votes are equally divided. Such new votes (except for the second vote) shall only take place between the candidates who were voted for in the previous vote, except for the person who received the lowest number of votes. If in the previous vote two or more persons have the lowest number of votes, it shall be decided by lot who cannot be voted for at the new vote. If, in the event of an election between two candidates, the votes are equally divided, it shall be decided by lot who has been elected.
34.5.If a vote is taken in respect of matters other than in relation to election of persons and the votes are equally divided, the relevant motion shall be considered rejected.
34.6.All voting shall take place orally unless the chairman of the meeting decides to have votes taken in writing or any person entitled to vote requests a vote in writing. A vote in writing shall take place by means of signed ballot papers.
34.7.Abstentions and invalid votes shall be deemed not to have been cast.
34.8.Votes by acclamation shall be allowed unless one of the persons present and entitled to vote objects.
34.9.The view of the chairman of the meeting stated at the meeting expressing that the General Meeting has passed a resolution shall be decisive. The same shall apply to the contents of the resolution so passed, provided that the relevant resolution was not proposed in writing. However, if the chairman's view is challenged immediately after it is expressed, a new vote shall be taken if the majority of the persons present and entitled to vote so require or, if the original vote was not by voice vote or by ballot, if one person present and entitled to vote so requires. The new vote shall nullify the legal consequences of the original vote.
34.10.Shareholders may also adopt resolutions without convening a General Meeting, provided that all persons with meeting rights have declared in writing to be in favour of this manner of adopting resolutions. The first sentence of Article 34.2 and Article 34.3 apply accordingly. Votes pursuant to this Article 34.10 shall be cast in writing. The requirement that these votes are cast in writing shall also be met if the resolution is recorded in writing, specifying the manner in which each of the shareholders has voted. The director(s) shall be given the opportunity to provide advice prior to the adoption of resolutions.

 

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CHAPTER IX

Amendment to the Articles of Association, dissolution, demerger and merger. Liquidation.

Article 35. Amendment to the Articles of Association and dissolution

35.1.Notwithstanding the provisions of article 2:331 paragraph 1 of the Dutch Civil Code and article 2:334ff paragraph 1 of the Dutch Civil Code, the General Meeting may resolve to merge the Company, or to demerge the Company, as well as to amend the Articles of Association or to dissolve the Company.
35.2.If a proposal to amend the Articles of Association or to dissolve the Company is to be submitted to the General Meeting, the convening notice must state this fact. At the same time, if the proposal is for an amendment toThose who convene a General Meeting in which a proposal is made to adopt a resolution to amend the Articles of Association, must deposit a copy of the proposal containing a, stating the verbatim text of the proposed amendment must be deposited, at the offices of the Company's office for inspection by the shareholders and depositary receipt holders until the meeting is adjourned.. The proposal must be deposited at the same time as the notice of the meeting and kept there until after the close of the meeting. The shareholders must be given the opportunity to obtain a copy of the proposal described in the preceding sentence from the day on which the convening notice for that meeting is dispatched until the day of the General Meeting. Such copies shall be provided free of charge.

Article 36. Liquidation

36.1.If the Company is dissolved pursuant to a resolution by the General Meeting, the directors shall be the liquidators of the Company, unless the General Meeting appoints one or more other persons as liquidatorsperson(s) as liquidator(s). The General Meeting determines the remuneration of the liquidatorsliquidator(s).
36.2.The provisions of these Articles of Association shall, to the fullest extent possible, continue to be in force during the liquidation.
36.3.The surplus remaining after payment of the debts shall be paid to each shareholder in proportion to the total nominal value of such shareholder’s individual shareholding.
36.4.After the Company has ceased to exist the books, records and other carriers of data shall be kept by the person designated thereto by the liquidatorsliquidator(s) for seven years.

CHAPTER X

Indemnification

Article 37. Indemnification

37.1.The Company shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than

 

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an action by or in the right of the Company) by reason of the fact that he is or was a member of the Board of Directors, officer, employee or agent of the Company, or is or was serving at the request of the Company as a supervisory director, member of the management board, officer, director, employee, trustee or agent of another company, partnership, joint venture, trust or other enterprise or entity, against all expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful or outside of his mandate. The termination of any action, suit or proceeding by a judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and not in a manner which he reasonably could believe to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful or outside of his mandate.

37.2.The Company shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding by or in the right of the Company to procure a judgment in its favor, by reason of the fact that he is or was a member of the Board of Directors, officer or agent of the Company, or is or was serving at the request of the Company as a supervisory director, member of the management board, officer, director, employee, trustee or agent of another company, partnership, joint venture, trust or other enterprise or entity, against all expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement, actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for gross negligence or willful misconduct in the performance of his duty to the Company, unless and only to the extent that the court in which such action or proceeding was brought or any other court having appropriate jurisdiction shall determine upon application that, despite the adjudication of liability but in view of all of the circumstances of the case, such person is fairly and reasonably entitled to indemnification against such expenses which the court in which such action or proceeding was brought or such other court having appropriate jurisdiction shall deem proper.
37.3.To the extent that a member of the Board of Directors, officer, employee or

 

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agent of the Company has been successful on the merits or otherwise in defense of any action, suit or proceeding, referred to in Articles 37.1 and 37.2, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection therewith.

37.4.Any indemnification by the Company referred to in Articles 37.1 and 37.2 shall (unless ordered by a court) only be made upon a determination that indemnification of the member of the Board of Directors, officer, director, employee, trustee or agent is proper under the circumstances because he had met the applicable standard of conduct set forth in Articles 37.1 and 37.2.37.2 Such determination shall be made:
a.by a majority of the members of the Board of Directors who are not parties to such action, suit or proceeding, even though less than a quorum, or
b.if there are no members of the Board of Directors who are not named as parties to such action, suit or proceeding or if the members of the Board of Directors who are not named as parties to such action, suit or proceeding so direct, by independent legal counsel in a written opinion; or
c.by the General Meeting.
37.5.Expenses incurred in defending a civil or criminal action, suit or proceeding may be paid by the Company in advance of the final disposition of such action, suit or proceeding upon a resolution of the Board of Directors with respect to the specific case upon receipt of an undertaking by or on behalf of the relevant member of the Board of Directors, officer, director, employee, trustee or agent to repay such amount unless it shall ultimately be determined that he is entitled to be indemnified by the Company as authorized in this Article 37.
37.6.The indemnification provided for by this Article 37 shall not be deemed exclusive of any other right to which a person seeking indemnification may be entitled under the laws of The Netherlands as from time to time amended or under any by-laws, agreement, resolution of the General Meeting or of the disinterested members of the Board of Directors or otherwise, both as to actions in his official capacity and as to actions in another capacity while holding such position, and shall continue as to a person who has ceased to be a member of the Board of Directors, officer, director, employee, trustee or agent and shall also inure to the benefit of the heirs, executors and administrators of such a person.
37.7.The Company shall have the power to purchase and maintain insurance on behalf of any person who is or was a member of the Board of Directors, officer, employee or agent of the Company, or is or was serving at the request of the Company as a supervisory director, member of the management board, officer, director, employee, trustee or agent of another company, partnership, joint

 

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venture, trust or other enterprise, or entity, against any liability asserted against him and incurred by him in any such capacity or arising out of his capacity as such, whether or not the Company would have the power to indemnify him against such liability under the provisions of this Article.

37.8.Whenever in this Article 37 reference is made to the Company, this shall include, in addition to the resulting or surviving company also any constituent company (including any constituent company of a constituent company) absorbed in a consolidation or merger which, if its separate existence had continued, would have had the power to indemnify its supervisory directors, members of the management board, officers, employees and agents, so that any person who is or was a supervisory director, member of the management board, officer, employee or agent of such constituent company, or is or was serving at the request of such constituent company as a supervisory director, member of the management board, officer, director, employee, trustee or agent of another company, a partnership, joint venture, trust or other enterprise or entity, shall stand in the same position under the provisions of this Article 37 with respect to the resulting or surviving company as he would have with respect to such constituent company if its separate existence had continued.
37.9.No person shall be personally liable to the Company or its shareholders for monetary damages for breach of fiduciary duty as a member of the Board of Directors; provided, however, that the foregoing shall not eliminate or limit the liability of a member of the Board of Directors (1) for any breach of such individual’s duty of loyalty to the Company or its shareholders, (2) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (3) for any transaction from which the relevant member of the Board of Directors derived an improper personal benefit or (4) for personal liability which is imposed by Dutch law, as from time to time amended. Any amendment, repeal or modification of this Article 37 shall not adversely affect any right or protection of any person with respect to any act or omission occurring prior to such amendment, repeal or modification.

CONCLUSION

The person appearing in connection with this deed is known to me, civil-law notary.

THIS DEED

is executed in Amsterdam on the date stated at the head of the deed.

The substance of this deed and an explanation of the deed have been communicated to the person appearing, who has expressly taken cognisance of its contents and has agreed to its limited reading.

After a limited reading in accordance with the law, this deed was signed by the person appearing and by me, civil-law notary.

 

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ANNEX 4

 

DRAFT 2016 ACCOUNTS

PREPARED IN ACCORDANCE WITH IFRS

 

 

 

 

MOBILEYE N.V.

2016 ANNUAL REPORT

 

 

 

 

2016 ANNUAL REPORT

 

TABLE OF CONTENTS

 

  Page
   
CONSOLIDATED FINANCIAL STATEMENTS:  
REPORT OF THE MANAGEMENT BOARD 3
Glossary 3
Forward-looking Statements 6
General Introduction 7
Business of the Company 7
Risk Factors 33
Operating and Financial Review and Prospects 51
Corporate Governance, Directors and Senior Management 65
Events since December 31, 2016 81
Consolidated Income Statements 83
Consolidated Statements of Comprehensive Income (Loss) 84
Consolidated Balance Sheets 85
Consolidated Statements of Changes in Shareholders' Equity 87
Consolidated Statements of Cash Flows 88
Notes to Consolidated Financial Statements 89
MOBILEYE N.V. FINANCIAL STATEMENTS:  
Mobileye N.V. balance sheets 125
Mobileye N.V. income statements 126
Notes to Mobileye N.V. financial statements 127
Other Information 137
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 138

 

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MOBILEYE N.V.

REPORT OF THE MANAGEMENT BOARD

 

GLOSSARY

 

In this Annual Report, unless the context otherwise requires:

 

·References to “Mobileye N.V.,” “Mobileye,” the “Company,” “we,” “our,” “ours,” “us” or similar terms refer to Mobileye N.V. together with its subsidiaries.

 

·References to “ordinary shares,” “our shares” and similar expressions refer to the Company’s ordinary shares, nominal value €0.01.

 

·References to “dollars,” “U.S. dollars” and “$” are to United States Dollars.

 

·References to “NIS” are to New Israeli Shekels, the Israeli currency.

 

·References to the “SEC” are to the United States Securities and Exchange Commission.

 

·ADAS means Advanced Driver Assistance Systems.

 

·Adaptive Cruise Control (ACC) systems automatically adjust a vehicle’s speed to maintain a safe following distance from the vehicle in front of it using cameras, radar or lidar sensors in front of the vehicle to detect the time-to-contact and distance of the vehicle ahead of it.

 

·Adaptive High Beam Control (AHC) automatically adjusts the height of the high-beam pattern depending on traffic conditions to give the driver the maximum amount of illumination.

 

·Autonomous Emergency Braking (AEB) avoids and/or mitigates an imminent collision with another vehicle by automatically applying the brakes to slow down the vehicle. Depending on the host car speed, the collision can be avoided or mitigated. AEB is equivalent to crash imminent braking (CIB), which is the term preferred by the NHTSA.

 

·Construction Zone Assist systems sense and measure the position of possible stationary obstacles located in the periphery of the driving path to enable automatic lateral control of the vehicle to find a “clear path” moving forward in a cluttered scene — such as construction areas.

 

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·Deep Layered Learning refers to a machine learning architecture consisting of feed-forward layers starting from the input image (or sequence of images with or without meta-data) going through operations of convolution and pooling and ending at an output layer consisting of meta-data, such as location and identity of objects in the scene. The Deep Layered Learning architecture’s parameters are determined through optimization over a large labeled training set.

 

·Drivable Path Delimiter Features provide the sensing technology underlying the support of Construction Zone Assist, whose aim is to find a clear path moving forward in a cluttered scene.

 

·Forward Collision Warning (FCW) systems use cameras, radar or lidar sensors to monitor the area in front of a vehicle and alert the driver of a potential rear-end collision with another vehicle.

 

·Free-Space Analysis is synonymous with Drivable Path Delimiter Features.

 

·Headway Monitoring and Warning (HMW) recognizes the preceding vehicles in both the host vehicle’s lane and adjacent lanes and provides accurate time-range (range divided by host car speed) estimation for contact with the targets.

 

·IIHS means the Insurance Institute for Highway Safety, a U.S. non-profit organization funded by automobile insurers.

 

·Lane Departure Warning (LDW) systems use visible lane markers to track vehicle position within a lane and issue a warning for an unintended road departure.

 

·Lane Keeping and Support (LKS) is a steering system that provides torque overlay in cases where the host vehicle approaches the lane marker without the turn signal having been activated, both alerting the driver of a lane departure and directing the vehicle to stay in the lane.

 

·Lane Keeping Assistant (LKA) is an LDW system in which the controller sends torque input to the steering system in order to keep the vehicle inside lane boundaries.

 

·Level 1 autonomous driving means that most functions are controlled by a human driver; certain functions (parking assist, acceleration and limited steering) can be done automatically by the car.

 

·Level 2 autonomous driving means that the system controls both steering and acceleration using information about the driving environment (e.g., lane centering and cruise control), but with the expectation that a human will perform all remaining aspects of driving; the driver can have his or her hands off the steering wheel but must monitor the “dynamic driving task” at all times.

 

·Level 3 autonomous driving means that the system performs all aspects of the driving task with the expectation that a human will respond appropriately if intervention is necessary. The vehicle transfers control to the driver

 

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when necessary; the driver must be ready to retake control at all times but does not need to continuously monitor conditions.

 

·Level 4 autonomous driving means that the system performs all aspects of the driving task even if the driver does not respond appropriately to a request for intervention, including all safety-critical driving functions and monitoring roadway conditions for an entire trip. For a defined use case (e.g., urban driving), no driver intervention is required.

 

·Level 5 autonomous driving means that the system performs all aspects of the driving task under all roadway and environmental conditions. System performance is equal to a human driver in every scenario, including extreme environment.

 

·NCAP means a New Car Assessment Program.

 

·NHTSA means the U.S. National Highway Traffic Safety Administration, a U.S. federal government agency.

 

·OEMs, or “original equipment manufacturers,” are vehicle manufacturers.

 

·Pedestrian Autonomous Emergency Braking (Ped-AEB) is similar to AEB, but here the imminent collision threatens a pedestrian who is stationary, walking, running or emerging behind an occlusion boundary.

 

·Pedestrian Collision Warning (PCW) warns the driver about a potential collision with pedestrians.

 

·Roadbook™ refers to the cloud-based data extracted using REM and forming a high definition environmental model and a description of drivable paths that enables autonomous driving.

 

·Road Experience Management (REM)™ refers to an algorithmic-based technology that allows the creation of a Roadbook through the use of crowd-sourced, real time data, collected from vehicles that already have cameras, and which extracts landmarks and roadway information using low bandwidths in order to form a layer of information supporting fully autonomous driving.