Intel is the world’s largest and highest valued semi-conductor chip company.  Although headquartered in Santa Clara, California, its greatest workforce is located in Washington County, Oregon (known as the “silicon forest”).  Intel employs over 17,000 people in Washington County and continues to expand its workforce here which makes it the state’s largest private employer.

Our family law firm and others which have been based in Washington County for many years have had a great deal of experience with clients and spouses of clients who work at Intel.  Intel is both an awesome and difficult employer.  My clients who work there, work hard, and put in long hours.  It can be such a creative place to work with bright, driven people from many different nationalities.  Employees are compensated well.  But the long hours become stressful over time and some people do burn out there.  I remember to give credit to the employee spouse who puts in the time day in and day out to rise up in the ranks at Intel.

In the context of a dissolution of marriage case, Intel employees have a unique employment package of income and benefits.  There are unique issues involved in both areas of property division and determining income for spousal support and child support.  For this article, I will focus on issues related to property division.

Property Division — What to look for:

  1. Retirement Assets

Intel employees have retirement assets managed by Fidelity.  Intel’s Sheltered Employee Retirement Plan (SERP) has three components

There are two types of basic retirement plan, depending on when you were hired by Intel. Employees hired before 2011 have the Intel Retirement Contribution Plan and employees hired after 2011 have the Intel 401K plan.  Many long term employees have both Intel 401K plans and Intel Retirement Contribution Plans.

Profit Sharing: Intel will also contribute to your Retirement Contribution Plan/401K plan in the form of profit sharing, a discretionary contribution based upon the company’s profitability. Profit sharing is shown as part of the Intel Retirement/401K plan and won’t be shown in a separate account or statement.

  • Look for the Intel SERPLUS plan for highly compensated employees. The SERPLUS plan is a deferred compensation plan where employees are able to defer their compensation once they have reached their 401K limit for the year.

Intel also has a minimum pension plan ( for employees who were hired before 2011 and have worked with Intel for at least 7 years). The minimum pension plan works as follows: using an annuity factor (determined by a pension formula based upon your final average pay), the profit sharing portion (only the part your employer has contributed) of the balance in your retirement account will be annuitized to determine what the monthly benefit would be.  If it is equal to or greater than the monthly benefit of the minimum pension, that employee won’t receive the minimum pension.  If it is lower than the minimum pension monthly payout, the pension would kick in the difference (you would not receive the whole amount of the minimum pension).  In May 2014, Intel changed this plan and there is a ceiling on the benefit for employees grade 7 and above.  Therefore the accumulation of benefits paid into the pension plan will be stopped.  If you were hired after 2011, there is no minimum pension plan as a backup.

2   Restricted Stock Units (RSU)

Restricted stock units are another benefit received by Intel Employees.  RSUs are a grant of Intel stock that become vested at a later time.  Currently Intel typically grants a new RSU award for its employees in April each year.  This award contains RSUs which will vest over a four year period.  25% of the awarded RSUs will vest each April for four years.

Each year in April when the Restricted Stock Units vest, the plan administrator will sell a certain percentage of vested RSU shares to pay taxes and the vested shares will now be available to sell in the employee’s UBS financial account.  UBS is the plan administrator for Intel RSUs.

When the RSUs vest, the current share price of Intel stock times the amount of shares that vested will appear on the employee’s paystub as income to the employee.  And, as stated above, taxes will have already been paid on that income by the sale of some of the vested shares.

Because of the four year vesting schedule, employees will typically have 25% of their RSUs vest from up to three different grant years.  Intel RSUs will never be “underwater” like Intel stock options often were.  The reason for that is that RSUs are shares and they have a value already.  They are not options to purchase shares which may or may not have a value based upon the grant price of the option.

You will need to review the employee’s UBS statement which shows:

  1. A small balance of cash in the money market section.
  2. Maybe some left over stock options from the past. Most stock options will be vested, but the employee may still be holding them. There may be a few remaining unvested stock options.
  • Restricted Stock Units both vested and unvested. The UBS statement may show a “potential value” of the unvested RSUs on its totals section, or you may have to look at the very end of the UBS statement to see the potential value of the unvested RSUs.

You will also need to ask the Intel Employee for a Vesting Schedule of the RSUs.  This vesting schedule should show all the awards of RSUs over the past several years for that employee and when the remaining unvested RSUs will vest.

As part of a dissolution of marriage case involving Intel RSUs, you would normally divide the vested RSUs equally and use a coverture fraction to divide the unvested RSUs pursuant to a slightly modified version of the Powell and Powell case 147 Or App 17 (1997).  So far in Oregon, there is not a new case dealing with dividing unvested RSUs.  Therefore, I use a modified version of the Powell coverture fraction which is as follows:

Months from date of RSU grant to date of settlement or trial/Months from date of RSU grant to date of vesting=Marital Portion of RSUs/2=non employee spouse’s percentage of RSUs.

This formula can be used to very simply determine the percentage of the unvested stock that would be awarded to the non employee spouse upon the RSU vesting.  I like to use a percentage, rather than determine an exact number of shares because some of the shares will be sold to pay taxes when the RSUs vest.  The non-employee spouse would then receive her percentage of whatever shares remain.

Language in the General Judgment of Dissolution of Marriage should indicate that once the shares have vested, the non-employee’s percentage of shares should be sold immediately by the Intel employee and the proceeds given to the spouse with all documentation supporting and evidencing what occurred after vesting.  This process will disentangle the parties quickly from each other, and by the fourth April after the divorce is final the non-employee spouse should have all the RSUs that were awarded to her as part of the divorce.

3.   UBS Statement:  The UBS Financial Services investment account statement is the place where Intel employees hold their vested and unvested stock options and RSUs.   The UBS statement, along with showing the balances of both unvested and vested stock options and RSUs, might also have stock from prior ESPP (employee stock purchase plans) where the employee has purchased stock at a lower than market price and then it has vested at a later time.

Typically if there is vested stock, whether it be from the sale of stock options, the vesting of RSUs or purchases of ESPP, on the very front page it will show that amount as “equities” and some may be in “cash and money balance”.  Beware that the value on the first page or two is the value of vested assets.  Unvested assets will (both options and RSUs) will show a value toward the end of the UBS statement.  That value will often say “unvested potential value”.  This is an additional value of unvested assets based upon the Intel stock price at the time of the statement.  You want to be sure to include all the value on your asset and liability spreadsheet.

Learning the basics of division of assets in an Intel dissolution of marriage case can also help you whenever you have a family law case involving an employee at another high tech company that may have similar assets.  I have had many cases involving high tech companies with RSUs and other similar assets.  Although the vesting schedules may be different than Intel’s the idea is the same and these same strategies can be used.  Cases involving an Intel employee are some of the most interesting in family law.