EQUITY

6 Months Ended

Jul. 01, 2023

EQUITY

EQUITY

NOTE 4 - EQUITY

A.Share-based compensation plans

Mobileye Plan

Following the Mobileye IPO in October 2022, the Company’s employees are incentivized and rewarded through the grant of the Company’s equity awards under the Mobileye Global Inc. 2022 Equity Incentive Plan (“the 2022 Plan”), which are granted for Class A shares and vest upon the satisfaction of a service-based vesting condition, mostly over service periods of three years.

Restricted Stock Units

The RSUs activity for the six months ended July 1, 2023 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 31, 2022		12,564	$	21.0
Granted		656		38.0
Vested		(3,750)		21.0
Forfeited		(116)		22.2
Outstanding as of July 1, 2023		9,354	$	22.2

The RSUs activity for the three months ended July 1, 2023 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 April 1, 2023	12,758	$	21.3
Granted	403		37.6
Vested	(3,750)		21.0
Forfeited	(57)		21.7
Outstanding as of July 1, 2023	9,354	$	22.2

As of July 1, 2023, the unrecognized compensation cost related to all unvested RSUs granted under the 2022 Plan, was $169 million, which is expected to be recognized as expense over a weighted-average period of 2.4 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 Intel’s equity incentive plan which contains only a service condition. The equity awards granted generally vest over the course of three years from the grant date.

Options

Outstanding and exercisable options for Intel’s common stock under Intel’s plan as of July 1, 2023 were as follows:

	Outstanding				Exercisable
		Weighted average
	Number of	remaining	Weighted average		Number of	Weighted 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	63	2.6	$	6.9	56	$	5.1
$ 22.4 - 26.9	2,121	0.1		26.8	2,121		26.8
$55.2	68	5.8		55.2	68		55.2
Total	2,252	0.4	$	27.1	2,245	$	27.1

The option activity for the six months ended July 1, 2023 for options granted to the 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 31, 2022	2,270	0.8	$	27.1	$	1
Exercised	(18)	—		22.3		—
Options outstanding as of July 1, 2023	2,252	0.4	$	27.1	$	16
Options exercisable as of July 1, 2023	2,245	0.4	$	27.1	$	16

The option activity for the three months ended July 1, 2023 for options granted to the 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 April 1, 2023	2,266	0.6	$	27.1	$	14
Exercised	(14)	—		22.9		—
Options outstanding as of July 1, 2023	2,252	0.4	$	27.1	$	16
Options exercisable as of July 1, 2023	2,245	0.4	$	27.1	$	16

(1)The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the closing stock price of Intel’s ordinary share. On July 1, 2023, Intel’s ordinary share price was $33.4. 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 July 1, 2023 are 7 thousand options with an average weighted exercise price of $21.6.

RSUs

The RSUs activity for the six months ended July 1, 2023 for RSUs granted to the Company’s employees for Intel’s common stock was as follows:

		Weighted average
	Number of RSUs	grant date fair value
	In thousands	U.S. dollars
Outstanding as of December 31, 2022	5,692	$	44.8
Vested	(703)		46.7
Forfeited	(141)		46.0
Outstanding as of July 1, 2023	4,848	$	44.5

The RSUs activity for the three months ended July 1, 2023 for RSUs granted to the Company’s employees for Intel’s common stock was as follows:

			Weighted average
	Number of RSUs		grant date fair value
	In thousands	U.S. dollars
Outstanding as of April 1, 2023	5,459	$	44.6
Vested	(563)		46.0
Forfeited	(48)		45.0
Outstanding as of July 1, 2023	4,848	$	44.5

Unrecognized expenses

As of July 1, 2023, the unrecognized compensation cost related to stock options and RSUs granted under the Intel 2006 Plan was $137 million, which will be recognized over a weighted average period of 1.4 years.

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

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

	Three months ended				Six months ended
U.S. dollars in millions	July 1, 2023		July 2, 2022			July 1, 2023	July 2, 2022
Cost of revenue	$	1	$	—	$	2	$	—
Research and development, net		45		32		105		69
Sales and marketing		2		1		4		2
General and administrative		7		3		16		5
Total share-based compensation	$	55	$	36	$	127	$	76