EQUITY

12 Months Ended

Dec. 31, 2022

EQUITY

EQUITY

NOTE 6  EQUITY

1.Common Stock and Voting Rights

We have two classes of authorized common stock: Class A common stock, which is listed on Nasdaq under the symbol “MBLY.”, and Class B common stock, which is not listed or traded on any stock exchange and is held by Intel. Both classes of common stock have a par value of $0.01 per share. The rights of the holders of our Class A common stock and Class B common stock are identical, except with respect to voting, transfer, and conversion rights. Each share of our Class A common stock is entitled to one vote. Each share of our Class B common stock is entitled to ten votes and is convertible at any time into one share of our Class A common stock, subject to certain conditions. Intel continues to directly, or indirectly, hold all of the Class B common stock of Mobileye, which represents approximately 99.3% of the voting power of our common stock. For more information on the reorganization and the Mobileye IPO, see Note 1.

2.Dividends

On May 12, 2022, Mobileye Group declared and paid a dividend in an aggregate amount of $336 million to Intel, net of $14 million of cash paid to tax authorities to settle related tax obligations.

In October 2022, the Company made a capital distribution in cash to Intel in the amount of $1.1 million.

3.Share-based compensation plans

Mobileye Plan

In connection with the Mobileye IPO, the Company approved the Mobileye Global Inc. 2022 Equity Incentive Plan (the “2022 Plan”). In October 2022, the Company’s board of directors approved the issuance of RSUs under the 2022 Plan in an aggregate value of $264 million, which constituted 12.6 million RSU units, issuable upon the vesting of such RSUs. RSUs awarded to employees in October 2022, under the 2022 Plan, vest upon the satisfaction of a service-based vesting condition, mostly over a service periods of three years. All RSUs granted are for Class A shares and include service conditions. The RSU granted in October 2022 also include 2.1 million RSUs granted to the Company’s Chief Executive Officer, in a total value of $44 million, which will vest over a service period of five years.

With respect to Israeli employees, the 2022 Plan is designed to grant awards pursuant to the provision of Section 102 of the Israeli Income Tax Ordinance. In accordance with the capital gains treatment elected by the Company, the Company is not allowed for tax purposes, to deduct the amounts credited to employees. This includes amounts recorded as salary benefits in the Company’s consolidated financial statements, in respect of equity granted to employees under the 2022 Plan, with the exception of the benefit component, if any, on the grant date.

Restricted Stock Units

The RSU activity for the year ended December 31, 2022 for RSUs granted to Company’s employees under the 2022 Plan was as follows:

		Weighted average grant
	Number of RSUs	date fair value
	In thousands	U.S. dollars
Outstanding as of December 25, 2021	—	$	—
Granted	12,570		21
Forfeited	(6)		21
Outstanding as of December 31, 2022	12,564	$	21

As of December 31, 2022, the unrecognized compensation cost related to all unvested RSUs granted under the Company’s 2022 Plan, was $211 million, which is expected to be recognized as expense over a weighted-average period of 1.69 years.

Intel Plan

Prior to the Mobileye IPO, since 2017, employees of the Company had been incentivized and rewarded through the grant of Intel equity awards under the Intel Corporation 2006 Equity Incentive Plan (the “2006 Plan”).

The 2006 Plan provides for the grant of equity awards covering Intel common stock to eligible employees of the Company and contain only a service condition. The equity awards granted generally vest over the course of three years from the grant date.

With respect to Israeli employees, the 2006 Plan is designed to grant awards pursuant to the provision of Section 102 of the Israeli Income Tax Ordinance. In accordance with the capital gains treatment elected by the Company, the Company is not allowed, for tax purposes to deduct the amounts credited to employees. This includes amounts recorded as salary benefits in the Company’s consolidated

financial statements, in respect of equity granted to employees under the 2006 Plan, with the exception of the benefit component, if any, on the grant date.

Options

Outstanding and exercisable options for Intel’s common stock under Intel’s 2006 Plan as of December 31, 2022 were as follows:

	Outstanding				Exercisable
		Weighted average	Weighted			Weighted
	Number of	remaining	average		Number of	average
Exercise price	options	contractual life	exercise price		options	exercise price
U.S. dollars	In thousands	In years	U.S. dollars		In thousands	U.S. dollars
$ 4.0 - 21.6	66	2.9	$	7.6	30	$	5.8
$ 22.4 - 26.9	2,136	0.6		26.8	2,136		26.8
$55.2	68	6.3		55.2	45		55.2
Total	2,270	0.8	$	27.1	2,211	$	27.1

The option activity for the years ended December 31, 2022, December 25, 2021, and December 26, 2020 for options granted to Company’s employees for Intel’s common stock was as follows:

		Weighted
		average	Weighted		Aggregated
	Number of	remaining	average		intrinsic
	options	contractual Life	exercise price		value(1)
	In thousands	In years	U.S. dollars		U.S. dollars in millions
Options outstanding as of December 28, 2019	6,594	3.4	$	29.1	$	204
Exercised	(173)	—		23.4		—
Forfeited	(30)	—		19.5		—
Options outstanding as of December 26, 2020	6,391	2.4		29.2		114
Exercised	(2,807)	—		29.3		—
Forfeited	(6)	—		24.5		—
Options outstanding as of December 25, 2021	3,578	1.5		29.2		79
Exercised	(1,308)	—		32.8		—
Options outstanding as of December 31, 2022	2,270	0.8	$	27.1	$	1
Options exercisable as of December 31, 2022	2,211	0.8	$	27.1	$	1

(1)The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the closing stock price of the Intel’s common stock. On December 31, 2022, December 25, 2021, and December 26, 2020, the Intel share prices were $26.43, $51.31, and $47.07, respectively. This represents the potential pre-tax amount receivable by the option holders had all option holders exercised their options as of such date.

(2)The remaining options expected to vest as of December 31, 2022 were 59 thousand options with an average weighted exercise price of $26.6.

RSUs

The RSU activity for the years ended December 31, 2022, December 25, 2021, and December 26, 2020 for RSUs granted to Company’s employees for Intel’s common stock was as follows:

		Weighted average grant
	Number of RSUs	date fair value
	In thousands	U.S. dollars
Outstanding as of December 28, 2019	2,371	$	43.2
Granted	3,628		44.4
Vested	(1,588)		42.0
Forfeited	(72)		47.4
Outstanding as of December 26, 2020	4,339		44.6
Granted	2,935		47.8
Vested	(1,761)		44.0
Forfeited	(235)		46.4
Outstanding as of December 25, 2021	5,278		46.5
Granted	3,758		43.7
Vested	(2,935)		45.9
Forfeited	(409)		48.1
Outstanding as of December 31, 2022	5,692	$	44.8

Unrecognized expenses

As of December 31, 2022, the unrecognized compensation cost related to stock options and RSUs granted under the Intel 2006 Plan was $197 million, which will be recognized over a weighted average period of 1.26 years.

Share-based compensation expense summary (for both Mobileye and Intel Plans)

Expenses recognized

Share-based compensation expenses included in the consolidated statements of operations and comprehensive income (loss) were as follows:

	Year ended
U.S. dollars in millions	December 31,		December 25,		December 26,
	2022		2021		2020
Cost of revenue	$	2	$	1	$	—
Research and development, net		153		77		67
Sales and marketing		5		4		3
General and administrative		14		15		15
Total share-based compensation	$	174	$	97	$	85