NVIDIA 2007 Annual Report Download - page 80

NVIDIA CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
2000 Nonstatutory Equity Incentive Plan
On August 1, 2000, our Board approved the 2000 Nonstatutory Equity Incentive Plan, or the 2000 Plan, to provide for the
issuance of our common stock to employees and affiliates who are not directors, executive officers or 10% stockholders. The 2000
Plan provides for the issuance of nonstatutory stock options, stock bonuses, restricted stock purchase rights, restricted stock unit
awards and stock appreciation rights. Options granted under the 2000 plan generally expire in six to 10 years from the date of grant.
The Compensation Committee appointed by the Board, or the Compensation Committee, has the authority to amend the 2000 Plan and
to determine the option term, exercise price and vesting period of each grant. Options granted to new employees prior to February
10, 2004, generally vest ratably over a four−year period, with 25% becoming vested approximately one year from the date of grant
and the remaining 75% vesting on a quarterly basis over the next three years. From February 10, 2004, initial options granted to new
employees generally vest ratably quarterly over a three−year period. Grants to existing employees in recognition of performance
generally vest as to 25% of the shares two years and three months after the date of grant and as to the remaining 75% of the shares
subject to the option in equal quarterly installments over a nine month period. We amended our 2000 Plan in October 2006 to add the
ability to issue restricted stock unit awards and stock appreciation rights and make certain other modifications. There were a total of
21,939,202 shares authorized for issuance and 18,776,119 shares available for future issuance under the 2000 Plan as of January 28,
2007.
1998 Equity Incentive Plan
The 1998 Equity Incentive Plan, or the 1998 Plan, was adopted by our Board on February 17, 1998 and was approved by our
stockholders on April 6, 1998 as an amendment and restatement of our then existing Equity Incentive Plan which had been adopted on
May 21, 1993. The 1998 Plan provides for the issuance of our common stock to directors, employees and consultants. The 1998 Plan
provides for the issuance of stock bonuses, restricted stock purchase rights, incentive stock options or nonstatutory stock options.
There were a total of 110,094,385 shares authorized for issuance and 2,570,982 shares available for future issuance under the 1998
Plan as of January 28, 2007.
Pursuant to the 1998 Plan, the exercise price for incentive stock options is at least 100% of the fair market value on the date of
grant or for employees owning in excess of 10% of the voting power of all classes of stock, 110% of the fair market value on the date
of grant. For nonstatutory stock options, the exercise price must be no less than 85% of the fair market value on the date of grant.
Option grants issued under the 1998 Plan generally expire in six to ten years from the date of grant. Vesting periods are
determined by the Board or the Compensation Committee. Initial option grants to new employees made after February 10, 2004 under
the 1998 Plan generally vest ratably quarterly over a three year period. Subsequent option grants generally vest up to 25% of the
shares two years and three months after the date of grant and as to the remaining 75% of the shares subject to the option in quarterly
installments over a nine month period.
1998 Non−Employee Directors' Stock Option Plan
In February 1998, our Board adopted the 1998 Non−Employee Directors' Stock Option Plan, or the Directors' Plan, to provide
for the automatic grant of non−qualified options to purchase shares of our common stock to our directors who are not employees or
consultants of us or of an affiliate of us.
In July 2000, the Board amended the 1998 Plan to incorporate the automatic grant provisions of the Directors' Plan into the
1998 Plan. Future automatic grants to non−employee directors will be made according to the terms of the Directors' Plan, but will be
made out of the 1998 Plan until such time as shares may become available for issuance under the amended Directors' Plan. In May
2002, and subsequently in March 2006, the Directors' Plan was amended further to reduce the number of shares granted to our
non−employee directors. The altered automatic grant provisions of the Directors' Plan are also incorporated into the 1998 Plan. The
terms of the amended Directors' Plan are described below.
Under the amended Directors' Plan, each non−employee director who is elected or appointed to our Board for the first time is
automatically granted an option to purchase 90,000 shares, which vests quarterly over a three−year period, or Initial Grant.
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Source: NVIDIA CORP, 10−K, March 16, 2007