Rodgers Silicon Valley Acquisition Corp. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Stock-based Compensation

Stock-based Compensation

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

We issue equity awards to our employees and non-employees in the form of stock options, restricted stock units (“RSUs”) and performance based RSUs (“PRSUs”). Additionally, we also offer an employee stock purchase plan (“ESPP”) to our eligible employees. We use Black-Scholes option pricing model to value our stock options granted and the estimated shares to be purchased under the ESPP. For both RSUs and PRSUs, we use our common stock price, which is the last reported sales price on the grant date to value those securities.

In general, we recognize stock-based compensation expense on a straight-line basis over the requisite service period and records forfeitures as they occur. For PRSUs, we use the graded vesting method to calculate the stock-based

compensation expense. At each reporting period, we would recognize and adjust the stock-based compensation expense based on its probability assessment in meeting its PRSUs' performance conditions.

Stock-based Compensation Expense

The following table summarizes the total stock-based compensation expense, by operating expense category, recognized in the Condensed Consolidated Statements of Operations for the periods presented below (in thousands).


	Quarters Ended
	March 31, 2024		April 2, 2023
Cost of revenue	$	—	$	951
Research and development	6,554		11,667
Selling, general and administrative	6,206		16,539

Total stock-based compensation expense	$	12,760	$	29,157

For the quarters ended March 31, 2024 and April 2, 2023, we capitalized $0.4 million and $0.6 million, respectively, of stock-based compensation as property and equipment, net on the Condensed Consolidated Balance Sheet. There was no recognized tax benefit related to stock-based compensation for the periods presented. In addition, we accrued an immaterial amount of bonus to be settled in equity awards as accrued compensation on the Condensed Consolidated Balance Sheet as of March 31, 2024.

As of March 31, 2024, there was approximately $110.3 million of total unrecognized stock-based compensation expense related to unvested equity awards, which are expected to be recognized over a weighted-average period of 3.6 years. As of March 31, 2024, there was approximately $1.4 million of total unrecognized stock-based compensation related to the ESPP, which is expected to be recognized over a period of 1.1 years.

Equity Award Modification

For the quarter ended March 31, 2024, there was no equity award modification. For the quarter ended April 2, 2023, we recognized $21.1 million of stock-based compensation expense related to the modifications in connection with the retirement or resignation of several of our former officers and executives, which impacted the vesting conditions as the term of equity award exercise period was extended and certain of the equity awards were accelerated and vested immediately.

Stock Option Activity

The following table summarizes stock option activities for the quarter ended March 31, 2024 (in thousands, except share and per share amount).


	Number of Options Outstanding	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value (1) (2)
Balances as of January 1, 2024	2,615,199	$	9.71

Exercised	(43,041)	2.23			$	336
Forfeited	(57,904)	11.23
Balances as of March 31, 2024	2,514,254	$	9.80	7.0	$	772


(1)			The intrinsic value of options exercised is based upon the value of our stock at exercise.
(2)			The aggregate intrinsic value of the stock options outstanding as of March 31, 2024 represents the value of our closing stock price at $8.01 on the last trading day of the quarter ended March 31, 2024 in excess of the exercise price multiplied by the number of options outstanding.

Unvested early exercised stock options which are subject to repurchase by us are not considered participating securities as those shares do not have non-forfeitable rights to dividends or dividend equivalents. Unvested early exercised stock options are not considered outstanding for purposes of the weighted average outstanding share calculation until they vest.

Early Exercise of Options

As of March 31, 2024, 308,745 shares remained subject to our right of repurchase as a result of early exercised stock options. The remaining liability related to early exercised shares as of March 31, 2024 was immaterial and was recorded in other current and non-current liabilities in the Condensed Consolidated Balance Sheets.

Restricted Stock Unit and Performance Restricted Stock Unit Activities

The following table summarizes RSUs and PRSUs activities for the fiscal quarter ended March 31, 2024 (in thousands, except share and per share amount).


	RSUs			PRSUs
	Number of Shares Outstanding	Weighted Average Grant Date Fair Value		Number of Shares Outstanding	Weighted Average Grant Date Fair Value
Issued and unvested shares balances as of January 1, 2024	10,893,271	$	11.58	531,469	$	13.16
Granted	826,024	9.87		—	—
Vested	(1,849,845)	9.54		(63,298)	13.41
Forfeited	(466,238)	13.94		(144,829)	13.13
Issued and unvested shares outstanding as of March 31, 2024	9,403,212	$	11.72	323,342	$	13.13