NVIDIA 2016 Annual Report Download - page 92

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exercise or strike price greater than the current fair market value of our common stock in exchange for cash or other stock
awards without obtaining the approval of our stockholders within 12 months prior to the repricing or cancellation and re-
grant event.
Stock Options. The 2007 Plan permits the grant of stock options that qualify as incentive stock options, or ISOs, and
nonstatutory stock options, or NSOs.
The exercise price of stock options granted under the 2007 Plan may not be less than 100% of the fair market value of
the common stock subject to the stock option on the date of grant and, in some cases (see Limitations on Incentive Stock
Options below), may not be less than 110% of such fair market value.
The term of stock options granted under the 2007 Plan may not exceed ten years and, in some cases (see Limitations
on Incentive Stock Options below), may not exceed five years. Except as otherwise provided in a participant’s stock option
agreement or other agreement with us, if a participant’s service relationship with us or any of our affiliates (referred to in
this Proposal 4 as “continuous service”) terminates (other than for cause and other than upon the participant’s death or
disability), the participant may exercise any vested stock options for up to 90 days following such termination. Except as
otherwise provided in a participant’s stock option agreement or other agreement with us, if a participant’s continuous service
terminates due to the participant’s death (or the participant dies within a specified period, if any, following termination of
continuous service) or the participant’s disability, the participant or his or her beneficiary, as applicable, may exercise any
vested stock options for up to 18 months following the participant’s death and for up to 12 months following the participant’s
termination due to disability. Except as explicitly provided otherwise in a participant’s stock option agreement or other
agreement with us, if a participant’s continuous service is terminated for cause, all stock options (whether vested or unvested)
held by the participant will terminate upon the date of the participant’s termination of continuous service and the participant
will be prohibited from exercising any stock option as of such termination date. Under the 2007 Plan, the term of a stock
option may be extended in the event that exercise of the stock option following a participant’s termination of continuous
service is prohibited by applicable securities laws or would subject the participant to short-swing liability under the Exchange
Act. In no event may a stock option be exercised after its original expiration date.
Acceptable forms of consideration for the purchase of our common stock pursuant to the exercise of a stock option
under the 2007 Plan will be determined by the Plan Administrator and may include: (i) cash, check, bank draft, money order
or electronic funds transfer; (ii) payment pursuant to a program developed under Regulation T as promulgated by the Federal
Reserve Board; (iii) a net exercise feature (for NSOs only); or (iv) other legal consideration approved by the Plan
Administrator.
Stock options granted under the 2007 Plan may vest and become exercisable in accordance with a vesting schedule to
be determined by the Plan Administrator. In the event that a participant’s continuous service terminates due to his or her
death, the participant’s outstanding stock options will become fully vested and exercisable as of the date of such termination.
Generally, a participant may not transfer a stock option granted under the 2007 Plan other than by will or the laws of
descent and distribution or pursuant to a domestic relations order or an official marital settlement agreement. However, to
the extent permitted by the Plan Administrator, a participant may designate a beneficiary who may exercise the stock option
following the participant’s death.
Limitations on Incentive Stock Options. The aggregate fair market value, determined at the time of grant, of shares of
our common stock with respect to ISOs that are exercisable for the first time by a participant during any calendar year under
all of our stock plans may not exceed $100,000. The stock options or portions of stock options that exceed this limit or
otherwise fail to qualify as ISOs are treated as NSOs. No ISO may be granted to any person who, at the time of grant, owns
or is deemed to own stock possessing more than 10% of our total combined voting power or that of any affiliate unless the
following conditions are satisfied:
• the exercise price of the ISO must be at least 110% of the fair market value of the common stock subject to the
ISO on the date of grant; and