BUSINESS COMBINATIONS

3 Months Ended

Mar. 28, 2026

BUSINESS COMBINATIONS

BUSINESS COMBINATIONS

NOTE 13 - BUSINESS COMBINATIONS

On February 3, 2026, the Company and Mobileye Vision Technologies Ltd. (a wholly-owned indirect subsidiary of the Company) acquired 100% of the issued and outstanding stock of Mentee Robotics, an AI-first humanoid robotics company, pursuant to the Share Purchase Agreement.

The Share Purchase Agreement provided for an aggregate purchase price of $900 million, which consisted of (i) approximately $612 million in cash, and (ii) 26,279,824 shares of Class A common stock of the Company. The entirety of such Class A common stock was allocated to the Mentee Founders (the “Aggregate Stock Consideration”). 10% of the Aggregate Stock Consideration is subject to a six month lock-up period pursuant to a Lock-Up Agreement. The remaining 90% of the Aggregate Stock Consideration was deposited with a deferred consideration trustee and will be released in equal portions twenty-four and forty-eight months after the closing date of February 3, 2026, subject to continued employment, or under certain circumstances affiliation, with the Company and its subsidiaries. Prof. Amnon Shashua received 37.83% of the total consideration, valued at approximately $341 million, paid evenly in cash and Class A Common Stock, and Prof. Shai Shalev-Shwartz received 13.07% of the total consideration, valued at approximately $118 million, paid evenly in cash and the Company’s Class A common stock.

At the closing, $95 million of the purchase price was deposited with an escrow agent (provided that with respect to the Mentee Founders, 50% of their pro rata portion of the escrow was deposited in the form of Class A common stock) to secure the post-closing purchase price adjustments and certain indemnification obligations of the shareholders of Mentee Robotics.

Pursuant to the Share Purchase Agreement, (i) all vested options to acquire shares of Mentee Robotics (each option, a “Mentee Option”) and 20% of unvested Mentee Options (“Accelerated Options”) were cancelled and converted into the right to receive a portion of the cash consideration based on the intrinsic value of such Mentee Options at the purchase price and (ii) all remaining unvested Mentee Options were cancelled and converted into the right to receive a number of unvested RSUs of the Company calculated based on the volume weighted average of the closing sale prices for the Company’s Class A common stock over the thirty (30) Trading Days ending immediately prior to February 3, 2026 and with a value equal to the intrinsic value of such Mentee Options at the purchase price.

The Share Purchase Agreement contains customary representations, warranties and covenants of the Company, Mobileye Vision Technologies Ltd. and Mentee Robotics, certain of which (except for the representations and warranties of the Company) shall survive the closing of the Acquisition. The shareholders of Mentee Robotics have agreed to indemnify the Company and Mobileye Vision Technologies Ltd. for certain breaches of representations, warranties and covenants.

Purchase Price Allocation

The following table summarizes the purchase consideration for the Acquisition of Mentee Robotics:

	U.S. dollars in millions
Cash paid for outstanding Mentee shares (1)	$	583
Cash paid for vested Mentee options (2)		24
Total cash consideration		607
Fair value of Mobileye Class A common stock issued to Mentee Founders (3)		23
Fair value of Mentee options assumed by Mobileye (4)		7
Total purchase consideration	$	637

(1) Represents the cash consideration paid to Mentee Robotics shareholders for their outstanding Mentee shares.

(2) Represents the cash consideration paid to Mentee Robotics employees for their vested options and accelerated options (which were converted into the right to receive cash consideration) for the portion attributable to the pre-combination service period. The portion of accelerated options value which is attributable to post-combination service period, amounted to $4 million and was recognized as an immediate expense.

(3) Represents the fair value of the Class A common stock (as of the closing date) issued to Mentee Founders that are not subject to continuing employment (10% of the Aggregate Stock Consideration). The substantial majority of the Class A common stock issued to Mentee Founders (90% of the Aggregate Stock Consideration) is contingent on continuing employment and therefore not recognized as part of the total purchase consideration of $637 million. The fair value of these Restricted Shares, amounting to $207 million will be recognized as share-based compensation expense over two and four years.

(4) Represents the fair value of Mentee Robotics options attributable to pre-acquisition services. The fair value of Mobileye RSUs that replaced Mentee Robotics unvested options that is attributable to post-combination services amounts to $10 million and will be recognized as an expense over a service period of up to four years.

Total purchase consideration has been allocated as follows:

	U.S. dollars in millions
Cash and cash equivalents	$	16
Other current assets		1
Property and equipment, net		1
Intangible assets (1)		128
Goodwill		498
Deferred tax assets		2
Other long-term assets		1
Total assets acquired		647
Accounts payable and accrued expenses		*
Employee related accrued expenses		1
Other current liabilities		1
Deferred tax liabilities		8
Total liabilities assumed		10
Fair value of net assets acquired (2)	$	637

* Less than $1 million.

(1) The fair value of the Developed IP Asset was determined using the Multi-Period Excess Earnings Method and will be amortized over a useful life of 9 years. The significant assumptions used include useful economic life, estimated annual net cash flows, discount rate and applicable tax rate.

(2) The fair value of the assets and liabilities acquired is based on our preliminary valuations. Final adjustments may be made to the purchase price allocation if more information becomes available.

The goodwill is primarily attributable to the expected synergies and other benefits that will be generated from the combination of Mobileye and Mentee Robotics, as well as the value attributable to the assembled workforce. Goodwill arising from the Acquisition has been allocated to the Mobileye reporting segment.

The Law for Encouragement of Knowledge-Intensive Industry (Temporary Order) — 2023 by the Israel Tax Authorities, generally referred to as the “Angels Law”, offers several incentives to promote investments in Israeli high-tech companies. Notably, it allows a five-year amortization period for the acquisition cost of an Israeli high-tech company. To qualify for this tax benefit, certain requirements must be met, as defined by the Angels Law. The Company expects the acquisition of Mentee Robotics to satisfy the requirements for tax incentives under the Angels Law.

For U.S. tax purposes, the Company has elected to treat the acquisition as an asset purchase. The election will result in a step‑up in the tax basis of the acquired assets to their estimated fair values. The step‑up will create deductible temporary differences primarily related to intangible assets and goodwill, which are expected to be amortized over fifteen years for U.S. tax purposes.

During the three months ended March 28, 2026, we incurred $6 million of transaction costs related to the Acquisition which were recorded in general and administrative expenses in the condensed consolidated statements of operations and comprehensive income (loss).

The operating results of Mentee Robotics have been included in the condensed consolidated statements of operations and comprehensive income (loss) since the acquisition date and are not material. Proforma financial information has not been presented because the impact of the acquisition was not material to the condensed consolidated statements of operations and comprehensive income (loss).