Components of Pay
Taking into account (i) the Company’s Fiscal 2021 outlook at the time of determining executive compensation (which occurred in early March 2021 prior to the full onset of the COVID-19 pandemic), (ii) stockholder feedback from our annual outreach efforts, and (iii) strong Fiscal 2020 say-on-pay approval, the CC maintained the same elements for our executive pay program for Fiscal 2021, with some adjustments to further strengthen the link between corporate performance and NEO pay, including an increase to the proportion of pay that is at-risk. The primary components of NVIDIA’s Fiscal 2021 executive compensation program are summarized below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Compensation
|
|
At-Risk Compensation
|
|
Base Salary
|
|
Variable Cash
|
|
SY PSUs
|
|
MY PSUs
|
|
RSUs (1)
|
Form
|
|
Cash
|
|
Cash
|
|
Equity
|
|
Equity
|
|
Equity
|
Who Receives
|
|
NEOs
|
|
NEOs
|
|
NEOs
|
|
NEOs
|
|
NEOs except our CEO
|
When Granted or Determined
|
|
Annually in March
|
|
Annually in March
|
|
Granted annually in March
|
|
Granted annually in March
|
|
Granted annually in March
|
When Paid, Earned, or Issued
|
|
Retroactively paid to start of fiscal year, via semi-monthly payroll
|
|
If a goal is achieved, earned after fiscal year end, paid in March
|
|
Shares eligible to vest determined after fiscal year end based on performance achieved; if a goal is achieved, shares issued on each vesting date, subject to the NEO’s continued service
|
|
Shares eligible to vest determined after 3rd fiscal year end based on performance achieved; if a goal is achieved, shares issued on the sole vesting date, subject to the NEO’s continued service
|
|
Issued on each vesting date, subject to the NEO’s continued service
|
Performance Measure
|
|
N/A
|
|
Revenue (determines cash payout)
|
|
Non-GAAP Operating Income (determines number of shares eligible to vest)
|
|
TSR relative to the S&P 500 (determines number of shares eligible to vest)
|
|
N/A
|
Performance Period
|
|
N/A
|
|
1 year
|
|
1 year
|
|
3 years
|
|
N/A
|
Vesting Period
|
|
N/A
|
|
N/A
|
|
4 years from grant
|
|
3 years from grant
|
|
4 years from grant
|
Vesting Terms
|
|
N/A
|
|
N/A
|
|
If at least Threshold achieved, 25% on approximately the 1-year anniversary of the grant date; 6.25% quarterly thereafter
|
|
If at least Threshold achieved, 100% on approximately the 3-year anniversary of the grant date
|
|
25% on approximately the 1-year anniversary of the grant date; 6.25% quarterly thereafter
|
Timeframe Emphasized
|
|
Annual
|
|
Annual
|
|
Long-term
|
|
Long-term
|
|
Long-term
|
Purpose
|
|
Compensate for expected day-to-day performance
|
|
Reward for annual corporate financial performance
|
|
Align with stockholder interests by linking NEO pay to annual operational performance
|
|
Align with long-term stockholder interests by linking NEO pay to multi-year relative shareholder return
|
|
Align with stockholder interests by linking NEO pay to the performance of our common stock
|
Maximum Amount That Can Be Earned
|
|
N/A
|
|
200% of target award opportunity under our Variable Cash Plan
|
|
150% of Mr. Huang’s SY PSU target opportunity and 200% of our other NEOs’ respective SY PSU target opportunity
Ultimate value delivered depends on stock price on date earned shares vest
|
|
150% of Mr. Huang’s MY PSU target opportunity and 200% of our other NEOs’ respective MY PSU target opportunity
Ultimate value delivered depends on stock price on date earned shares vest
|
|
100% of grant
Ultimate value delivered depends on stock price on date shares vest
|
(1) Our CC considers RSUs to be at-risk pay because the realized value depends on our stock price, which is a financial performance measure.
(2) Based on total target pay as approved by the CC, consisting of base salary, target opportunity under our Variable Cash Plan, and target value of equity opportunities the CC intended to deliver.
We provide medical, vision, dental, and accidental death and disability insurance as well as time off and paid holidays for our NEOs, on the same basis as our other employees. Like other employees, our NEOs are eligible to participate in our 2012 ESPP, unless otherwise prohibited by the rules of the Internal Revenue Service, and our 401(k) plan, which included a Company match of salary deferral contributions of up to $6,500 for calendar 2020, which increased to up to $7,000 for calendar 2021. For Fiscal 2021, Mr. Puri, Mr. Teter and Ms. Kress each received a $7,000 401(k) match, while Mr. Huang and Ms. Shoquist each received matches of $6,500.
Compensation Actions and Achievements
Stockholder Outreach and Feedback
We value stockholder feedback and conduct an annual stockholder outreach program. During the Fall of 2019, in preparing for Fiscal 2021 compensation decisions, we contacted our top institutional holders who held 1% or more of our stock (with the exception of brokerage firms and index funds who we know do not engage in direct conversations), with an aggregate ownership of approximately 31% of our common stock outstanding. Members of management and the Board, including our Lead Director, ultimately discussed executive compensation with representatives of stockholders holding an aggregate of approximately 19% of our common stock. Our stockholders generally provided positive feedback on our pay for performance alignment and the simplicity of our executive compensation program design.
After considering their feedback, and our Fiscal 2020 say-on-pay approval rate of 95%, our CC determined to maintain the same general elements and metrics for our Fiscal 2021 NEO pay program, but increased the rigor of the corporate goals and increased the proportion of “at-risk” target pay to further align pay with performance, as described below. In the Fall of 2020, members of management and the Board, including our Lead Director and a member of our CC, again engaged in stockholder outreach. The CC considered the feedback from these meetings in making decisions regarding the current Fiscal 2022 executive compensation program.
Total Target Compensation Approach
Our CC reviewed each NEO’s total target pay opportunity and distribution across different pay elements. Our CC compared Mr. Huang’s base salary, target variable cash opportunity, target equity opportunity, and total target pay against chief executives of our peer companies. For our other NEOs, our CC reviewed their respective total target pay against similarly situated executives of our peer companies. The CC also considered the factors discussed above in Factors Used in Determining Executive Compensation and the CC’s specific compensation objectives for Fiscal 2021. Our CC did not use a single formula or assign a specific weight to any one factor in determining each NEO’s target pay. Instead, our CC used its business judgment and experience to set total target compensation, mix of cash and equity, and fixed and at-risk pay opportunities for each NEO to achieve our program’s objectives. When the CC set each element of pay for an NEO, it considered the context of the levels of the other pay elements, and the resulting total target pay for such NEO. These amounts and structure allowed our NEOs to realize above-market value from equity awards and variable cash incentives only upon exceptional corporate performance.
For Fiscal 2021, the CC considered that NEO target pay had been kept essentially flat for the last three years, and made adjustments to better align each NEO’s total target pay with those of similarly situated executives at our peer companies. As a result, Mr. Huang’s total target pay increased by approximately 46% and each other NEO’s total target pay increased by an average of 76%, with all increases pertaining to at-risk pay opportunities only.
While the CC generally made no changes to base salary and target variable cash compared to the prior year, it did increase Mr. Huang’s target variable cash to 150% of his base salary, which brought his target variable cash compensation, as a percentage of his base salary, to the 25th percentile of peer company chief executive officers. For our other NEOs, the CC increased their respective target equity opportunities due to their increased responsibilities and scope, to better align their pay with those of peer executives, as well as to provide for retention.
Continued Emphasis on Long-Term, At-Risk, Performance-Based Equity Awards
For Fiscal 2021, the CC decided that the largest portion of NEOs’ total target pay would remain in the form of at-risk, performance-based equity. The CC believes an emphasis on long-term, at-risk opportunities drives results and increases NEO and stockholder alignment, while providing sufficient annual cash compensation to be competitive and retain our NEOs. The PSUs and RSUs provide long-term incentives and retention benefits because our NEOs must achieve, for PSUs, the predetermined performance goal and also, for both PSUs and RSUs, remain with us for a multi-year period (3 years for MY PSUs and 4 years for SY PSUs and RSUs) to fully vest in the awards.
The CC concluded that, given Mr. Huang’s position as CEO, 100% of his equity grants should be at-risk and performance-based, tightly aligning his interests with stockholders. Consistent with its practice in recent years, the CC granted Mr. Huang’s target equity opportunity 100% in the form of SY PSUs (which value is aligned with Non-GAAP Operating Income performance) and MY PSUs (which value is aligned with relative stock price performance). For each of our other NEOs, the CC provided 40% of the target equity opportunity in the form of RSUs and 60% of the target equity opportunity in the form of PSUs. The CC, after considering our CEO’s recommendations, determined this mix provided an appropriate balance, by placing a greater emphasis on awards contingent upon performance goal achievement while still providing a meaningful amount of time-vesting RSUs to encourage retention and to reward our other NEOs, in line with our stock performance over the long-term.
The CC evaluated market positioning, internal pay equity, individual performance, and level of unvested equity to determine a target equity opportunity value for our NEOs. Because our CEO’s target equity opportunity value had been kept constant for the preceding three years, the CC felt it was appropriate to increase the value for Fiscal 2021 to bring that portion of pay closer to the median of peer company chief executive officers, representing an increase of 51% from Fiscal 2020. The target equity opportunity values for our other NEOs represented an average increase of 111% from Fiscal 2020, which the CC felt was appropriate due to their increased responsibilities and scope, to bring those portions of pay closer to the median of peer company executives, as well as to provide for retention. To determine actual shares awarded, the CC used the eight-week trailing average of our stock price ending the week prior to the date of grant, reducing the impact of daily volatility on compensation decisions. This average stock price determined the number of RSUs and the target numbers of SY PSUs and MY PSUs.
The target numbers of SY PSU and MY PSU shares were eligible to vest upon our achievement of the Base Operating Plan Non-GAAP Operating Income performance goal for Fiscal 2021, and the Target TSR performance goal relative to the S&P 500 over a 3-year period starting at the beginning of Fiscal 2021, respectively. No shares were eligible to vest if at least Threshold performance was not achieved. Shares underlying any PSUs that are not earned are cancelled.
If the Company achieved at least Threshold performance, the minimum number of shares eligible to vest was 50% of the SY PSU target opportunity and 25% of the MY PSU target opportunity. If the Company achieved at least Stretch Operating Plan performance for SY PSUs (or Stretch performance for MY PSUs), the maximum number of shares eligible to vest was capped at 150% of Mr. Huang’s, and 200% of our other NEOs’ respective, PSU target opportunities.
Goals for and Achievement of Performance-Based Compensation
Based on the Fiscal 2021 strategic plan as approved by the Board, the CC set performance metrics and goals, and certified the Company’s performance achievement with resulting payouts to our NEOs, as set forth below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE METRICS
|
|
|
Variable Cash Plan
|
|
SY PSUs
|
|
MY PSUs
|
Metric
|
|
Revenue
|
|
Non-GAAP Operating Income
|
|
TSR relative to the S&P 500
|
Timeframe
|
|
1 year
|
|
1 year
|
|
3 years
|
CC’s Rationale for Metric
|
|
Drives value, contributes to Company’s long-term success
Focuses on growth in new and existing markets
Exclusion of impact from acquisitions to align with stockholder interests
Distinct, separate metric from Non-GAAP Operating Income
|
|
Drives value, contributes to Company’s long-term success
Reflects our annual revenue generation and effective operating expense management
Exclusion of impact from acquisitions to align with stockholder interests
Distinct, separate metric from revenue
|
|
Aligns directly with long-term shareholder value creation
Provides comparison of our stock price performance, including dividends, against a capital market index in which we compete
Relative performance goal accounts for macroeconomic factors impacting the market
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE GOALS
|
|
|
Variable Cash Plan
|
|
SY PSUs
|
|
MY PSUs
|
|
|
Fiscal 2021 Performance Goal
|
|
Payout as a % of Target Opportunity (1)
|
|
Fiscal 2021 Performance Goal
|
|
Shares Eligible to Vest as a % of Target Opportunity (1)
|
|
Fiscal 2019 - Fiscal 2021 Performance Goal
|
|
Shares Eligible to Vest as a % of Target Opportunity (1)
|
Threshold
|
|
$12.0 billion
|
|
50%
|
|
$4.0 billion
|
|
50%
|
|
25th percentile
|
|
25%
|
Base Operating Plan
(Target for MY PSUs)
|
|
$12.7 billion
|
|
100%
|
|
$4.4 billion
|
|
100%
|
|
50th percentile
|
|
100%
|
Stretch Operating Plan (Stretch for MY PSUs)
|
|
$13.3 billion
|
|
200%
|
|
$4.8 billion
|
|
150% for CEO; 200% for other NEOs
|
|
75th percentile
|
|
150% for CEO; 200% for other NEOs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PERFORMANCE ACHIEVEMENT AND PAYOUTS
|
|
|
Variable Cash Plan
|
|
SY PSUs
|
|
MY PSUs
|
Performance
|
|
Revenue, as adjusted, of $15.0 billion*
|
|
Non-GAAP Operating Income, as adjusted, of $6.1 billion*
|
|
3-year TSR of 157%
97th percentile of S&P 500
|
Payout
|
|
200% of target
|
|
150% of CEO’s (200% of other NEOs’) target eligible to vest (2)
|
|
150% of CEO’s (200% of other NEOs’) target eligible to vest (3)
|
(1)For achievement between Threshold and Base Operating Plan (or Target for MY PSUs) and between Base Operating Plan (or Target for MY PSUs) and Stretch Operating Plan (or Stretch for MY PSUs), payouts would be determined using straight-line interpolation. Achievement less than Threshold would result in no payout, and exceeding Stretch Operating Plan (or Stretch for MY PSUs) would result in the capped maximum payout.
(2)25% of the eligible SY PSU shares vested on March 17, 2021, approximately one year after grant, and 6.25% will vest every quarter thereafter for the next three years.
(3)100% of the eligible MY PSUs vested on March 17, 2021, after the 3-year performance period.
* Revenue, on an adjusted basis, is GAAP revenue, as the Company reports in its respective earnings materials, excluding the impact of acquisitions completed during the applicable fiscal year. Non-GAAP Operating Income, on an adjusted basis, is GAAP operating income as the Company reports in its respective earnings materials, excluding stock-based compensation expense, acquisition-related costs, legal settlement costs and other costs, and the estimated unaudited operating income and costs associated with acquisitions completed during the applicable fiscal year.
Each of the performance goal levels as described above were set by the CC with the following objectives:
•Threshold was uncertain, but attainable and high enough to create modest value; represented an appropriately decelerated payout for performance below Base Operating Plan (Target for MY PSUs)
•Base Operating Plan (Target for MY PSU) was uncertain but attainable with significant effort and execution success; included budgeted investments in future businesses and revenue growth (and for PSUs, gross margin growth) considering macroeconomic conditions and reasonable but challenging growth estimates for ongoing and new businesses
•Stretch Operating Plan (Stretch for MY PSU) required exceptional achievement; only possible with strong market factors and a very high level of management execution and corporate performance
At the time the CC established the Fiscal 2021 goals, the Company had executed a definitive agreement to acquire Mellanox. However, due to uncertainty around the likelihood and timing of the receipt of required regulatory approvals as well as regarding the closing of the transaction, the CC believed that in order to best align our executives’ interests with those of our stockholders and to remain consistent with our pay for performance philosophy, the Fiscal 2021 performance goals should exclude the additional revenue and estimated unaudited operating income and costs generated by the acquisition of Mellanox and other acquisitions completed during Fiscal 2021.
In accordance with the performance goals and methodology established by the CC in early Fiscal 2021, the CC excluded the additional revenue and the estimated unaudited operating income and costs generated by acquisitions completed during Fiscal 2021 in its certification of Fiscal 2021 results. Such exclusion had the effect of reducing the overall levels of revenue and Non-GAAP Operating Income. The CC determined the foregoing approach best aligned our executives’ interests with those of our stockholders and remained consistent with our pay for performance philosophy.
Achievement of goals for Fiscal 2020 and Fiscal 2021 MY PSU grants will be determined after January 2022 and January 2023, respectively.
Target Fiscal 2021 Compensation Actions
The CC’s target Fiscal 2021 compensation actions are summarized below for each NEO, reflecting the target value of the variable cash and equity opportunities the CC intended to deliver, as well as the variable cash earned and PSUs which became eligible to vest. The CC considered the factors set forth in Factors Used in Determining Executive Compensation above to set the total target pay opportunity for each NEO and to make the Fiscal 2021 changes to NEO target pay opportunity, which are described in Compensation Actions and Achievement - Total Target Compensation Approach above.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jen-Hsun Huang
|
|
|
Target Pay ($)
|
|
Fiscal 2021 Compensation Actions
|
President & CEO
|
Base Salary
|
|
1,000,000
|
|
|
No change from Fiscal 2020
|
|
Variable Cash
|
|
1,500,000
|
|
|
Up 36% from Fiscal 2020 target to balance market competitiveness with peer company chief executive officers; earned at $3,000,000
|
Equity
|
|
15,000,000
|
|
|
Up 51% from Fiscal 2020 target after being kept flat over last 3 years
|
SY PSUs
|
|
10,000,086
|
|
|
38,727 shares Target opportunity; 58,090 shares became eligible to vest
|
MY PSUs
|
|
4,999,914
|
|
|
19,363 shares Target opportunity
|
Total
|
|
17,500,000
|
|
|
Up 46% from Fiscal 2020 target
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Colette M. Kress
|
|
|
Target Pay ($)
|
|
Fiscal 2021 Compensation Actions
|
EVP & CFO
|
Base Salary
|
|
900,000
|
|
|
No change from Fiscal 2020
|
|
Variable Cash
|
|
300,000
|
|
|
No change from Fiscal 2020 target; earned at $600,000
|
Equity
|
|
6,800,223
|
|
|
Up 106% from Fiscal 2020 target
|
SY PSUs
|
|
3,740,058
|
|
|
14,484 shares Target opportunity; 28,968 shares became eligible to vest
|
MY PSUs
|
|
340,076
|
|
|
1,317 shares Target opportunity
|
RSUs
|
|
2,720,089
|
|
|
Granted 10,534 shares
|
Total
|
|
8,000,223
|
|
|
Up 78% from Fiscal 2020 target
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ajay K. Puri
|
|
|
Target Pay ($)
|
|
Fiscal 2021 Compensation Actions
|
EVP, Worldwide Field
|
Base Salary
|
|
950,000
|
|
|
No change from Fiscal 2020
|
Operations
|
Variable Cash
|
|
650,000
|
|
|
No change from Fiscal 2020 target; earned at $1,300,000
|
Equity
|
|
6,400,499
|
|
|
Up 88% from Fiscal 2020 target
|
SY PSUs
|
|
3,520,055
|
|
|
13,632 shares Target opportunity; 27,264 shares became eligible to vest
|
MY PSUs
|
|
320,193
|
|
|
1,240 shares Target opportunity
|
RSUs
|
|
2,560,251
|
|
|
Granted 9,915 shares
|
Total
|
|
8,000,499
|
|
|
Up 60% from Fiscal 2020 target
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debora Shoquist
|
|
|
Target Pay ($)
|
|
Fiscal 2021 Compensation Actions
|
EVP, Operations
|
Base Salary
|
|
850,000
|
|
|
No change from Fiscal 2020
|
|
Variable Cash
|
|
250,000
|
|
|
No change from Fiscal 2020 target; earned at $500,000
|
Equity
|
|
5,900,327
|
|
|
Up 145% from Fiscal 2020 target
|
SY PSUs
|
|
3,245,051
|
|
|
12,567 shares Target opportunity; 25,134 shares became eligible to vest
|
MY PSUs
|
|
295,145
|
|
|
1,143 shares Target opportunity
|
RSUs
|
|
2,360,131
|
|
|
Granted 9,140 shares
|
Total
|
|
7,000,327
|
|
|
Up 100% from Fiscal 2020 target
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Timothy S. Teter
|
|
|
Target Pay ($)
|
|
Fiscal 2021 Compensation Actions
|
EVP, General Counsel &
|
Base Salary
|
|
850,000
|
|
|
No change from Fiscal 2020
|
Secretary
|
Variable Cash
|
|
250,000
|
|
|
No change from Fiscal 2020 target; earned at $500,000
|
Equity
|
|
3,900,413
|
|
|
Up 104% from Fiscal 2020 target
|
SY PSUs
|
|
2,145,034
|
|
|
8,307 shares Target opportunity; 16,614 shares became eligible to vest
|
MY PSUs
|
|
195,214
|
|
|
756 shares Target opportunity
|
RSUs
|
|
1,560,165
|
|
|
Granted 6,042 shares
|
Total
|
|
5,000,413
|
|
|
Up 66% from Fiscal 2020 target
|
Additional Executive Compensation Practices, Policies, and Procedures
Stock Ownership Guidelines
The Board believes that executive officers should hold a significant equity interest in NVIDIA. Our Corporate Governance Policies require the CEO to hold shares of our common stock valued at six times his base salary, and our other NEOs to hold shares of our common stock valued at the NEO’s respective base salary. NEOs have up to five years from appointment to reach the ownership threshold. The stock ownership guidelines are intended to further align NEO interests with stockholder interests. Each NEO currently exceeds the stock ownership requirements.
Compensation Recovery (“Clawback”) Policy
We maintain a Compensation Recovery Policy for all employees. Under this policy, if we are required to prepare an accounting restatement to correct an accounting error on an interim or annual financial statement included in a report on Form 10-Q or Form 10-K due to material noncompliance with any financial reporting requirement under the federal securities laws, or a Restatement, and if the Board or a committee of independent directors concludes that our CEO, our CFO or any other employee received a variable compensation payment that would not have been payable if the original interim or annual financial statements had reflected the Restatement, which we refer to as the Overpayment, then:
•Our CEO and our CFO will disgorge the net after-tax portion of the Overpayment; and
•The Board or the committee of independent directors in its sole discretion may require any other employee to repay the Overpayment. In using its discretion, the Board or the independent committee may consider whether such person was involved in the preparation of our financial statements or otherwise caused the need for the Restatement and may, to the extent permitted by applicable law, recoup amounts by (1) requiring partial or full repayment by such person of any variable or incentive compensation or any gains realized on the exercise of stock options or on the open-market sale of vested shares, (2) canceling up to all and any outstanding equity awards held by such person and/or (3) adjusting the future compensation of such person.
We will review and update the Compensation Recovery Policy as necessary for compliance with the clawback policy provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act when the final regulations related to that policy are issued.
Tax and Accounting Implications
Under Section 162(m) of the Internal Revenue Code, or Section 162(m), compensation paid to each of the Company’s “covered employees” that exceeds $1 million per taxable year is generally non-deductible unless the compensation qualifies for certain grandfathered exceptions (including the “performance-based compensation” exception) for certain compensation paid pursuant to a written binding contract in effect on November 2, 2017 and not materially modified on or after such date.
Although the CC will continue to consider tax implications as one factor in determining executive compensation, the CC also looks at other factors in making its decisions and retains the flexibility to provide compensation for the NEOs in a manner consistent with the goals of the Company’s executive compensation program and the best interests of the Company and its stockholders, which may include providing for compensation that is not deductible by the Company due to the deduction limit under Section 162(m). The CC also retains the flexibility to modify compensation that was initially intended to be exempt from the deduction limit under Section 162(m) if it determines that such modifications are consistent with the Company’s business needs.
Our CC also considers the impact of Section 409A of the Internal Revenue Code, and in general, our executive plans and programs are designed to comply with the requirements of that section to avoid the possible adverse tax consequences that may arise from non-compliance.
Under FASB ASC Topic 718, the Company is required to estimate and record an expense for each award of equity compensation over the vesting period of the award. We record share-based compensation expense on an ongoing basis according to FASB ASC Topic 718.
Risk Analysis of Our Compensation Plans
With the oversight of the CC, members from the Company’s Legal, Human Resources and Finance departments, as well as Exequity, the independent consultant engaged by the CC, performed an assessment of the Company’s compensation programs and policies for Fiscal 2021 as generally applicable to our employees to ascertain any potential material risks that may be created by our compensation programs. The assessment focused on programs with variability of payout and the ability of participants to directly affect payout and the controls over participant action and payout—specifically, the Company’s variable cash compensation, equity compensation, and sales incentive compensation programs. We identified the key terms of these programs, potential concerns regarding risk taking behavior, and specific risk mitigation features. The assessment was first presented to our Senior Vice President, Human Resources; our CFO; and our General Counsel, and then presented to the CC.
The CC considered the findings of the assessment described above and concluded that our compensation programs, which are structured to recognize both short-term and long-term contributions to the Company, do not create risks which are reasonably likely to have a material adverse effect on our business or financial condition.
The CC believes that the following compensation design features guard against excessive risk-taking:
|
|
|
|
|
|
ü
|
Our compensation program encourages our employees to remain focused on both our short-term and long-term goals
|
ü
|
We design our variable cash and PSU compensation programs for executives so that payouts are based on achievement of corporate performance targets, and we cap the potential award payout
|
ü
|
We have internal controls over our financial accounting and reporting which is used to measure and determine the eligible compensation awards under our Variable Cash Plan and our SY PSUs
|
ü
|
Financial plan target goals and final awards under our Variable Cash Plan and our SY PSUs are approved by the CC and consistent with the annual operating plan approved by the full Board each year
|
ü
|
MY PSUs are designed with a relative goal
|
ü
|
We have a compensation recovery policy applicable to all employees that allows NVIDIA to recover compensation paid in situations of fraud or material financial misconduct
|
ü
|
All executive officer equity awards have multi-year vesting
|
ü
|
We have stock ownership guidelines that we believe are reasonable and are designed to align our executive officers’ interests with those of our stockholders
|
ü
|
We enforce a “no-hedging” policy and a “no-pledging” policy involving our common stock which prevents our employees from insulating themselves from the effects of NVIDIA stock price performance
|
Summary Compensation Table for Fiscal 2021, 2020, and 2019
The following table summarizes information regarding the compensation earned by our NEOs during Fiscal 2021, 2020, and 2019. Fiscal 2021 was a 53-week year. Fiscal 2020, and 2019 were 52-week years.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name and Principal Position
|
|
Fiscal
Year
|
|
Salary
($)
|
|
Bonus
($)
|
|
Stock
Awards ($) (1)
|
|
Non-Equity
Incentive Plan
Compensation
($) (2)
|
|
All Other
Compensation
($)
|
|
Total
($)
|
Jen-Hsun Huang
|
|
2021
|
|
1,017,355
|
|
|
—
|
|
|
|
15,279,780
|
|
|
3,000,000
|
|
|
|
19,266
|
|
(3)
|
|
19,316,401
|
|
President and CEO
|
|
2020
|
|
996,514
|
|
|
—
|
|
|
|
9,676,920
|
|
|
805,444
|
|
|
|
13,402
|
|
(3)
|
|
11,492,280
|
|
|
2019
|
|
996,514
|
|
|
—
|
|
|
|
11,611,022
|
|
|
1,021,900
|
|
|
|
13,402
|
|
(3)
|
|
13,642,838
|
|
Colette M. Kress
|
|
2021
|
|
915,620
|
|
|
—
|
|
|
|
6,595,691
|
|
|
600,000
|
|
|
|
9,731
|
|
(4)
|
|
8,121,042
|
|
Executive Vice President and CFO
|
|
2020
|
|
896,863
|
|
|
—
|
|
|
|
3,307,188
|
|
|
219,667
|
|
|
|
9,122
|
|
(4)
|
|
4,432,840
|
|
|
2019
|
|
896,863
|
|
|
—
|
|
|
|
3,791,203
|
|
|
278,700
|
|
|
|
8,622
|
|
(4)
|
|
4,975,388
|
|
Ajay K. Puri
|
|
2021
|
|
966,487
|
|
|
—
|
|
|
|
6,208,052
|
|
|
1,300,000
|
|
|
|
33,388
|
|
(3)
|
|
8,507,927
|
|
Executive Vice President, Worldwide Field Operations
|
|
2020
|
|
946,689
|
|
|
—
|
|
|
|
3,410,921
|
|
|
475,944
|
|
|
|
23,151
|
|
(3)
|
|
4,856,705
|
|
|
2019
|
|
946,689
|
|
|
—
|
|
|
|
3,898,599
|
|
|
603,850
|
|
|
|
15,428
|
|
(3)
|
|
5,464,566
|
|
Debora Shoquist
|
|
2021
|
|
864,752
|
|
|
—
|
|
|
|
5,722,904
|
|
|
500,000
|
|
|
|
21,581
|
|
(4)
|
|
7,109,237
|
|
Executive Vice President, Operations
|
|
2020
|
|
847,037
|
|
|
—
|
|
|
|
2,407,200
|
|
|
183,056
|
|
|
|
20,478
|
|
(4)
|
|
3,457,771
|
|
|
2019
|
|
847,037
|
|
|
—
|
|
|
|
2,776,480
|
|
|
232,250
|
|
|
|
14,104
|
|
(4)
|
|
3,869,871
|
|
Timothy S. Teter
|
|
2021
|
|
864,752
|
|
|
—
|
|
|
|
3,783,191
|
|
|
500,000
|
|
|
|
9,921
|
|
(4)
|
|
5,157,864
|
|
Executive Vice President, General Counsel and Secretary
|
|
2020
|
|
847,037
|
|
|
—
|
|
|
|
1,918,173
|
|
|
183,056
|
|
|
|
9,122
|
|
(4)
|
|
2,957,388
|
|
|
2019
|
|
847,037
|
|
|
450,000
|
|
(5)
|
|
2,228,115
|
|
|
232,250
|
|
|
|
8,622
|
|
(4)
|
|
3,766,024
|
|
(1)Amounts shown in this column do not reflect dollar amounts actually received by the NEO. Instead, these amounts reflect the aggregate full grant date fair value calculated in accordance with FASB ASC Topic 718 for the respective fiscal year for grants of RSUs, SY PSUs, and MY PSUs, as applicable. The assumptions used in the calculation of values of the awards are set forth under Note 4 to our consolidated financial statements titled Stock-Based Compensation in our Form 10-K. With regard to the stock awards with performance-based vesting conditions, the reported grant date fair value assumes the probable outcome of the conditions at Base Operating Plan for SY PSUs and Target for MY PSUs, determined in accordance with applicable accounting standards.
Based on Stretch Operating Plan and Stretch performance in Fiscal 2021, the respective grant date fair values of SY PSUs and MY PSUs granted in Fiscal 2021 would be $11,293,920 and $7,007,385 for Mr. Huang, $6,001,079 and $886,431 for Ms. Kress, $5,587,212 and $824,917 for Mr. Puri, $5,069,877 and $748,419 for Ms. Shoquist, and $4,035,208 and $596,212 for Mr. Teter.
Based on Stretch Operating Plan and Stretch performance in Fiscal 2020, the respective grant date fair values of SY PSUs and MY PSUs granted in Fiscal 2020 would be $9,780,540 and $4,734,840 for Mr. Huang, $3,793,664 and $479,310 for Ms. Kress, $3,882,578 and $479,310 for Mr. Puri, $2,815,610 and $368,700 for Ms. Shoquist, and $2,371,040 and $368,700 for Mr. Teter.
Based on Stretch Operating Plan and Stretch performance in Fiscal 2019, the respective grant date fair values of SY PSUs and MY PSUs granted in Fiscal 2019 would be $11,108,385 and $6,308,148 for Mr. Huang, $4,300,020 and $636,408 for Ms. Kress, $4,395,576 and $636,408 for Mr. Puri, $3,201,126 and $494,984 for Ms. Shoquist, and $2,723,346 and $494,984 for Mr. Teter.
(2)As applicable, reflects amounts earned in Fiscal 2021, 2020, and 2019 and paid in March or April of each respective year pursuant to our Variable Cash Plan for each respective year. For further information please see our Compensation Discussion and Analysis above.
(3)Represents a match of contributions to our 401(k) savings plan, a contribution to a health savings account and imputed income from life insurance coverage. These benefits are available to all eligible NVIDIA employees. For Fiscal 2021, the match of contributions for our 401(k) savings plan was $6,500 for Mr. Huang and $7,000 for Mr. Puri. For Fiscal 2021 the match of contributions to a health savings account was $2,500 for Mr. Huang and $1,250 for Mr. Puri. For Fiscal 2021 imputed income from life insurance coverage was $10,266 for Mr. Huang and $25,138 for Mr. Puri.
(4)Represents a match of contributions to our 401(k) savings plan and imputed income from life insurance coverage. These benefits are available to all eligible NVIDIA employees. For Fiscal 2021, the match of contributions for our 401(k) savings plan was $7,000 for Ms. Kress, $6,500 for Ms. Shoquist and $7,000 for Mr. Teter. For Fiscal 2021 imputed income from life insurance coverage was $2,731 for Ms. Kress, $15,081 for Ms. Shoquist and $2,921 for Mr. Teter.
(5)Represents an anniversary bonus paid in Fiscal 2018 that was earned in Fiscal 2019.
Grants of Plan-Based Awards for Fiscal 2021
The following table provides information regarding all grants of plan-based awards that were made to or earned by our NEOs during Fiscal 2021. Disclosure on a separate line item is provided for each grant of an award made to an NEO. The information in this table supplements the dollar value of stock and other awards set forth in the Summary Compensation Table for Fiscal Years 2021, 2020, and 2019 by providing additional details about the awards. The PSUs and RSUs set forth in the following table were made under our 2007 Plan. PSUs are eligible to vest based on performance against pre-established criteria. Both SY PSUs and RSUs are subject to service-based vesting.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Grant
Date
|
|
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards (1)
|
|
Estimated Future Payouts Under Equity Incentive Plan Awards
|
|
All Other Stock
Awards: Number of Shares of Stock
or Units (#)
|
|
Grant Date
Fair Value
of Stock
Awards ($) (2)
|
|
Threshold ($)
|
|
Target ($)
|
|
Maximum ($)
|
|
Threshold (#)
|
|
Target (#)
|
|
Maximum (#)
|
|
Jen-Hsun Huang
|
|
3/9/20
|
(3)
|
|
|
|
—
|
|
|
|
|
19,363
|
|
|
38,727
|
|
|
58,090
|
|
|
—
|
|
|
|
9,406,014
|
|
(4)
|
|
3/9/20
|
(5)
|
|
|
|
—
|
|
|
|
|
9,681
|
|
|
19,363
|
|
|
29,044
|
|
|
—
|
|
|
|
5,873,766
|
|
|
|
3/9/20
|
|
|
750,000
|
|
|
1,500,000
|
|
|
3,000,000
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Colette M. Kress
|
|
3/9/20
|
(3)
|
|
|
|
—
|
|
|
|
|
7,242
|
|
|
14,484
|
|
|
28,968
|
|
|
—
|
|
|
|
3,517,874
|
|
(4)
|
|
3/9/20
|
(5)
|
|
|
|
—
|
|
|
|
|
658
|
|
|
1,317
|
|
|
2,634
|
|
|
—
|
|
|
|
519,319
|
|
|
|
3/9/20
|
|
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
|
|
10,534
|
|
(6)
|
|
2,558,498
|
|
|
|
3/9/20
|
|
|
150,000
|
|
|
300,000
|
|
|
600,000
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Ajay K. Puri
|
|
3/9/20
|
(3)
|
|
|
|
—
|
|
|
|
|
6,816
|
|
|
13,632
|
|
|
27,264
|
|
|
—
|
|
|
|
3,310,940
|
|
(4)
|
|
3/9/20
|
(5)
|
|
|
|
—
|
|
|
|
|
620
|
|
|
1,240
|
|
|
2,480
|
|
|
—
|
|
|
|
488,957
|
|
|
|
3/9/20
|
|
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
|
|
9,915
|
|
(6)
|
|
2,408,155
|
|
|
|
3/9/20
|
|
|
325,000
|
|
|
650,000
|
|
|
1,300,000
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Debora Shoquist
|
|
3/9/20
|
(3)
|
|
|
|
—
|
|
|
|
|
6,283
|
|
|
12,567
|
|
|
25,134
|
|
|
—
|
|
|
|
3,052,273
|
|
(4)
|
|
3/9/20
|
(5)
|
|
|
|
—
|
|
|
|
|
571
|
|
|
1,143
|
|
|
2,286
|
|
|
—
|
|
|
|
450,708
|
|
|
|
3/9/20
|
|
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
|
|
9,140
|
|
(6)
|
|
2,219,923
|
|
|
|
3/9/20
|
|
|
125,000
|
|
|
250,000
|
|
|
500,000
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Timothy S. Teter
|
|
3/9/20
|
(3)
|
|
|
|
—
|
|
|
|
|
4,153
|
|
|
8,307
|
|
|
16,614
|
|
|
—
|
|
|
|
2,017,604
|
|
(4)
|
|
3/9/20
|
(5)
|
|
|
|
—
|
|
|
|
|
378
|
|
|
756
|
|
|
1,512
|
|
|
—
|
|
|
|
298,106
|
|
|
|
|
3/9/20
|
|
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
|
|
6,042
|
|
(6)
|
|
1,467,481
|
|
|
|
|
3/9/20
|
|
|
125,000
|
|
|
250,000
|
|
|
500,000
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
(1)Represents range of awards payable under our Fiscal 2021 Variable Cash Plan.
(2)Amounts shown in this column do not reflect dollar amounts actually received by the NEO. Instead, these amounts reflect the aggregate full grant date fair value calculated in accordance with FASB ASC Topic 718 for the awards. The assumptions used in the calculation of values of the awards are set forth under Note 4 to our consolidated financial statements titled Stock-Based Compensation in our Form 10-K. With regard to the stock awards with performance-based vesting conditions, the reported grant date fair value assumes the probable outcome of the conditions at Base Operating Plan for SY PSUs and Target for MY PSUs, determined in accordance with applicable accounting standards.
(3)Represents range of possible shares able to be earned with respect to SY PSUs.
(4)Based on the performance that was actually achieved for Fiscal 2021, the grant date fair value for the NEOs’ SY PSUs would be: $14,108,899 for Mr. Huang, $7,035,748 for Ms. Kress, $6,621,880 for Mr. Puri, $6,104,546 for Ms. Shoquist, and $4,035,208 for Mr. Teter.
(5)Represents range of possible shares able to be earned with respect to MY PSUs.
(6)Represents RSUs granted to Messrs. Puri and Teter and Mses. Kress and Shoquist in the first quarter of Fiscal 2021 pursuant to the 2007 Plan. The CC granted these awards on March 9, 2020, the same day that annual grants were made to all of our eligible employees.
Outstanding Equity Awards as of January 31, 2021
The following table presents information regarding outstanding equity awards held by our NEOs as of January 31, 2021.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Option Awards
|
|
Stock Awards
|
|
Number of Securities
Underlying Unexercised
Options (#)
Exercisable
|
|
Number of Securities
Underlying Unexercised
Options (#)
Unexercisable
|
|
Option
Exercise
Price ($) (1)
|
|
Option
Expiration
Date
|
|
Number of
Units of Stock
That Have
Not Vested (#)
|
|
Market Value of Units of Stock That Have Not
Vested ($) (2)
|
|
Equity Incentive Plan Awards: Number of Unearned Shares That Have Not Vested (#)
|
|
Equity Incentive Plan Awards: Market Value of Unearned Shares That Have Not
Vested ($) (2)
|
Jen-Hsun Huang
|
|
50,000
|
|
|
—
|
|
|
|
17.62
|
|
|
3/17/2021
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
250,000
|
|
|
—
|
|
|
|
14.465
|
|
|
9/20/2021
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
300,000
|
|
|
—
|
|
|
|
14.46
|
|
|
3/20/2022
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
300,000
|
|
|
—
|
|
|
|
13.71
|
|
|
9/18/2022
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
237,500
|
|
|
—
|
|
|
|
12.62
|
|
|
3/19/2023
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
237,500
|
|
|
—
|
|
|
|
16.00
|
|
|
9/17/2023
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
6,329
|
|
(3)
|
|
3,288,485
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
8,707
|
|
(4)
|
|
4,524,070
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
24,407
|
|
(5)
|
|
12,681,633
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
23,100
|
|
(6)
|
|
12,002,529
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
58,090
|
|
(7)
|
|
30,182,983
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
33,000
|
|
(8)
|
|
17,146,470
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
29,044
|
|
(9)
|
|
15,090,972
|
|
Colette M. Kress
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
375
|
|
(10)
|
|
194,846
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
2,438
|
|
(3)
|
|
1,266,760
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
694
|
|
(11)
|
|
360,595
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
2,528
|
|
(4)
|
|
1,313,524
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
868
|
|
(12)
|
|
451,004
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
1,068
|
|
(13)
|
|
554,922
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
7,100
|
|
(5)
|
|
3,689,089
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
4,444
|
|
(14)
|
|
2,309,058
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
10,534
|
|
(15)
|
|
5,473,361
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
1,800
|
|
(6)
|
|
935,262
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
28,968
|
|
(7)
|
|
15,051,483
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
2,600
|
|
(8)
|
|
1,350,934
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
2,634
|
|
(9)
|
|
1,368,600
|
|
Ajay K. Puri
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
391
|
|
(10)
|
|
203,160
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
2,500
|
|
(3)
|
|
1,298,975
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
722
|
|
(11)
|
|
375,144
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
2,585
|
|
(4)
|
|
1,343,140
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
907
|
|
(12)
|
|
471,268
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
1,116
|
|
(13)
|
|
579,862
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
7,267
|
|
(5)
|
|
3,775,861
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
4,669
|
|
(14)
|
|
2,425,966
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
9,915
|
|
(15)
|
|
5,151,735
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
1,800
|
|
(6)
|
|
935,262
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
27,264
|
|
(7)
|
|
14,166,102
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
2,600
|
|
(8)
|
|
1,350,934
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
2,480
|
|
(9)
|
|
1,288,583
|
|
Debora Shoquist
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
266
|
|
(10)
|
|
138,211
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
1,813
|
|
(3)
|
|
942,017
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
497
|
|
(11)
|
|
258,236
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
1,882
|
|
(4)
|
|
977,868
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
610
|
|
(12)
|
|
316,950
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debora Shoquist (con’t)
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
749
|
|
(13)
|
|
389,173
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
5,270
|
|
(5)
|
|
2,738,239
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
3,094
|
|
(14)
|
|
1,607,611
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
9,140
|
|
(15)
|
|
4,749,053
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
1,400
|
|
(6)
|
|
727,426
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
25,134
|
|
(7)
|
|
13,059,375
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
2,000
|
|
(8)
|
|
1,039,180
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
2,286
|
|
(9)
|
|
1,187,783
|
|
Timothy S. Teter
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
3,044
|
|
(10)
|
|
1,581,632
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
407
|
|
(12)
|
|
211,473
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
1,601
|
|
(4)
|
|
831,864
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
499
|
|
(13)
|
|
259,275
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
2,082
|
|
(14)
|
|
1,081,786
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
4,438
|
|
(5)
|
|
2,305,940
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
6,042
|
|
(15)
|
|
3,139,363
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
1,400
|
|
(6)
|
|
727,426
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
16,614
|
|
(7)
|
|
8,632,468
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
2,000
|
|
(8)
|
|
1,039,180
|
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
1,512
|
|
(9)
|
|
785,620
|
|
(1)Unless otherwise noted, represents the closing price of our common stock as reported by Nasdaq on the date of grant which is the exercise price of stock option grants made pursuant to our 2007 Plan.
(2)Calculated by multiplying the number of RSUs or PSUs by the closing price ($519.59) of NVIDIA’s common stock on January 29, 2021, the last trading day before the end of our Fiscal 2021, as reported by Nasdaq.
(3)The RSU was earned on January 28, 2018, based on achievement of a performance goal. The RSU vested as to 25% of the shares on March 21, 2018, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on March 17, 2021.
(4)The RSU was earned on January 27, 2019, based on achievement of a performance goal. The RSU vested as to 25% of the shares on March 20, 2019, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on March 16, 2022.
(5)The RSU was earned on January 26, 2020, based on achievement of a performance goal. The RSU vested as to 25% of the shares on March 18, 2020, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on March 15, 2023.
(6)The RSU was earned on January 31, 2021, based on achievement of a performance goal. The RSU vested as to 100% of the shares on March 17, 2021.
(7)Represents the number of shares subject to the RSU that became eligible to vest, determined as of January 31, 2021, based on achieving Stretch performance goals. The RSU vested as to 25% of the shares on March 17, 2021, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on March 20, 2024.
(8)Represents the possible number of shares that could be earned based on achieving Stretch performance goals. The number of PSUs that could be earned is based on our TSR relative to the S&P 500 from January 28, 2019 through January 30, 2022. If the performance goal is achieved, the shares earned will vest as to 100% on March 16, 2022. If the Threshold performance goal is achieved, 5,500 shares will be earned by Mr. Huang, 325 shares will be earned by Ms. Kress, 325 shares will be earned by Mr. Puri, 250 shares will be earned by Ms. Shoquist, and 250 shares will be earned by Mr. Teter. If the Target performance goal is achieved, 22,000 shares will be earned by Mr. Huang, 1,300 shares will be earned by Ms. Kress, 1,300 shares will be earned by Mr. Puri, 1,000 shares will be earned by Ms. Shoquist, and 1,000 shares will be earned by Mr. Teter.
(9)Represents the possible number of shares that could be earned based on achieving Stretch performance goals. The number of PSUs that could be earned is based on our TSR relative to the S&P 500 from January 26, 2020 through January 29, 2023. If the performance goal is achieved, the shares earned will vest as to 100% on March 15, 2023. If the Threshold performance goal is achieved, 9,681 shares will be earned by Mr. Huang, 658 shares will be earned by Ms. Kress, 620 shares will be earned by Mr. Puri, 571 shares will be earned by Ms. Shoquist, and 378 shares will be earned by Mr. Teter. If the Target performance goal is achieved, 19,363 shares will be earned by Mr. Huang, 1,317 shares will be earned by Ms. Kress, 1,240 shares will be earned by Mr. Puri, 1,143 shares will be earned by Ms. Shoquist, and 756 shares will be earned by Mr. Teter.
(10)The RSU vested as to 25% on March 21, 2018, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on March 17, 2021.
(11)The RSU vested as to 25% on September 19, 2018, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on September 15, 2021.
(12)The RSU vested as to 25% on March 20, 2019, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on March 16, 2022.
(13)The RSU vested as to 25% on September 18, 2019, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on September 21, 2022.
(14)The RSU vested as to 25% on March 18, 2020, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on March 15, 2023.
(15)The RSU vested as to 25% on March 17, 2021, and vests as to 6.25% approximately every three months thereafter over the next three years such that the RSU will be fully vested on March 20, 2024.
Option Exercises and Stock Vested in Fiscal 2021
The following table shows information regarding option exercises and stock vested by our NEOs during Fiscal 2021.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Option Awards
|
|
Stock Awards
|
|
Number of
Shares Acquired on
Exercise (#)
|
|
Value
Realized
on Exercise ($)
|
|
Number of
Shares Acquired on
Vesting (#) (1)
|
|
Value
Realized
on Vesting ($) (2)
|
Jen-Hsun Huang
|
|
450,000
|
|
|
214,949,729
|
|
|
137,134
|
|
(3)
|
|
36,209,653
|
|
Colette M. Kress
|
|
—
|
|
|
—
|
|
|
46,918
|
|
(4)
|
|
13,866,745
|
|
Ajay K. Puri
|
|
—
|
|
|
—
|
|
|
48,363
|
|
(5)
|
|
14,296,188
|
|
Debora Shoquist
|
|
—
|
|
|
—
|
|
|
33,838
|
|
(6)
|
|
10,037,280
|
|
Timothy S. Teter
|
|
—
|
|
|
—
|
|
|
19,135
|
|
(7)
|
|
7,183,476
|
|
(1)Represents the gross number of shares acquired on vesting. Shares were withheld from these amounts to pay taxes due upon vesting.
(2)Represents the number of shares acquired on vesting multiplied by the fair market value of our common stock as reported by Nasdaq on the date of vesting.
(3)Includes an aggregate of 67,854 shares that were withheld to pay taxes due upon vesting.
(4)Includes an aggregate of 22,702 shares that were withheld to pay taxes due upon vesting.
(5)Includes an aggregate of 23,607 shares that were withheld to pay taxes due upon vesting.
(6)Includes an aggregate of 16,190 shares that were withheld to pay taxes due upon vesting.
(7)Includes an aggregate of 9,736 shares that were withheld to pay taxes due upon vesting.
Employment, Severance and Change-in-Control Arrangements
Employment Agreements. Our executive officers are “at-will” employees and we do not have employment, severance or change-in-control agreements with our executive officers.
Change-in-Control Arrangements. Our 2007 Plan provides that in the event of a corporate transaction or a change-in-control, outstanding stock awards may be assumed, continued, or substituted by the surviving corporation. If the surviving corporation does not assume, continue, or substitute such stock awards, then (a) with respect to any stock awards that are held by individuals performing services for NVIDIA immediately prior to the effective time of the transaction, the vesting and exercisability provisions of such stock awards will be accelerated in full and such stock awards will be terminated if not exercised prior to the effective date of the corporate transaction or change-in-control, and (b) all other outstanding stock awards will be terminated if not exercised on or prior to the effective date of the corporate transaction or change-in-control.
Potential Payments Upon Termination or Change-in-Control
Upon a change-in-control or certain other corporate transactions of NVIDIA, unvested RSUs and PSUs will fully vest in some cases as described above under Employment, Severance and Change-in-Control Arrangements—Change-in-Control Arrangements. The table below shows our estimates of the amount of the benefit each of our NEOs would have received if the unvested RSUs and PSUs held by them as of January 31, 2021 had become fully vested as a result of a change-in-control, calculated by multiplying the number of unvested RSUs and PSUs held by the applicable NEO by the $519.59 closing price of our common stock on January 29, 2021.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Unvested RSUs and PSUs at January 31, 2021 (#) (1)
|
|
Total Estimated Benefit ($) (1)
|
Jen-Hsun Huang
|
|
134,933
|
|
70,109,837
|
Colette M. Kress
|
|
48,050
|
|
24,966,300
|
Ajay K. Puri
|
|
47,144
|
|
24,495,551
|
Debora Shoquist
|
|
38,731
|
|
20,124,240
|
Timothy S. Teter
|
|
28,876
|
|
15,003,681
|
(1) With respect to unvested PSUs, the amounts in these columns assume performance at Base Operating Plan (with respect to SY PSUs granted in Fiscal 2021) and Target (with respect to MY PSUs granted in Fiscal 2019, Fiscal 2020, and Fiscal 2021) in accordance with SEC rules. The two tables below reflect the actual numbers of the SY PSUs granted in Fiscal 2021 and MY PSUs granted in Fiscal 2019 that would be eligible to vest, based on our performance during the relevant performance period for such awards, as certified by our CC shortly after the end of Fiscal 2021. The values of the estimated and actual SY PSUs and MY PSUs in the tables below were calculated by multiplying the applicable number of SY PSUs and MY PSUs held by each respective NEO and listed below, by the $519.59 closing price of our common stock on January 29, 2021.
SY PSUs granted in Fiscal 2021 - Actual Achievement (versus Base Operating Performance)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Estimated SY PSUs Granted in Fiscal 2021 at Base Operating Plan Performance (#)
|
|
Value of Estimated SY PSUs Granted in Fiscal 2021 at Base Operating Plan Performance ($)
|
|
Actual SY PSUs Granted in Fiscal 2021
Eligible to Vest (#)
|
|
Value of Actual SY PSUs Granted in Fiscal 2021 Eligible to Vest ($)
|
Jen-Hsun Huang
|
|
38,727
|
|
20,122,162
|
|
58,090
|
|
30,182,983
|
Colette M. Kress
|
|
14,484
|
|
7,525,742
|
|
28,968
|
|
15,051,483
|
Ajay K. Puri
|
|
13,632
|
|
7,083,051
|
|
27,264
|
|
14,166,102
|
Debora Shoquist
|
|
12,567
|
|
6,529,688
|
|
25,134
|
|
13,059,375
|
Timothy S. Teter
|
|
8,307
|
|
4,316,234
|
|
16,614
|
|
8,632,468
|
MY PSUs granted in Fiscal 2019 - Actual Achievement (versus Target Performance)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Estimated MY PSUs Granted in Fiscal 2019 at Target Performance (#)
|
|
Value of Estimated MY PSUs Granted in Fiscal 2019 at Target Performance ($)
|
|
Actual MY PSUs Granted in Fiscal 2019 Eligible to Vest (#)
|
|
Value of Actual MY PSUs Granted in Fiscal 2019 Eligible to Vest ($)
|
Jen-Hsun Huang
|
|
15,400
|
|
8,001,686
|
|
23,100
|
|
12,002,529
|
Colette M. Kress
|
|
900
|
|
467,631
|
|
1,800
|
|
935,262
|
Ajay K. Puri
|
|
900
|
|
467,631
|
|
1,800
|
|
935,262
|
Debora Shoquist
|
|
700
|
|
363,713
|
|
1,400
|
|
727,426
|
Timothy S. Teter
|
|
700
|
|
363,713
|
|
1,400
|
|
727,426
|
The actual number of MY PSUs granted in Fiscal 2020 that will become eligible to vest will be determinable after January 30, 2022, the ending date of the three year measurement period for MY PSUs.
The actual number of MY PSUs granted in Fiscal 2021 that will become eligible to vest will be determinable after January 29, 2023, the ending date of the three year measurement period for MY PSUs.
Pay Ratio
In accordance with Item 402(u) of Regulation S-K, promulgated by the Dodd-Frank Wall Street Reform and Consumer Protection Act, we determined the ratio of: (a) the annual total compensation of our CEO, to (b) the median of the annual total compensation of all our employees, except for our CEO, both calculated in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K.
To determine the median of the annual total compensation of all of our employees, except for our CEO, for Fiscal 2021, we used a consistently applied compensation measure which aggregated, for each employee employed by us on the last business day of Fiscal 2021, or January 29, 2021: (i) target base salary as of January 29, 2021 (annualized for permanent employees who were employed by us for less than the entire fiscal year), (ii) variable cash earned during Fiscal 2021, and (iii) aggregate full grant date fair value of equity awards granted during Fiscal 2021, calculated in accordance with FASB ASC Topic 718 and assuming the probable outcome of the conditions at Base Operating Plan for performance-based awards. Compensation paid in foreign currencies was converted to U.S. dollars based on exchange rates in effect on January 29, 2021.
After applying the methodology described above, we determined the identity of our median employee for Fiscal 2021, whose compensation for Fiscal 2021 was $215,930. Our CEO’s compensation for Fiscal 2021 was $19,316,401. Therefore, our Fiscal 2021 CEO to median employee pay ratio was 89:1.
This pay ratio represents our reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K and applicable guidance, which provide significant flexibility in how companies identify the median employee. Each company may use a different methodology and make different assumptions. As a result, and as explained by the SEC when it adopted these rules, in considering the pay ratio disclosure, stockholders should keep in mind that the rule was not designed to facilitate comparisons of pay ratios among different companies, even companies within the same industry, but rather to allow stockholders to better understand and assess each particular company’s compensation practices and pay ratio disclosures. Neither the CC nor our management used our Fiscal 2021 CEO to median employee pay ratio in making compensation decisions.
Compensation Committee Interlocks and Insider Participation
At the beginning of Fiscal 2021, the CC initially consisted of Messrs. Burgess, Coxe, Jones, and Seawell and Dr. Drell. After the 2020 Meeting, the CC became composed of Messrs. Burgess, Coxe, and Jones and Dr. Drell. No member of the CC is an officer or employee of NVIDIA, and none of our executive officers serve as a director or member of a compensation committee of any entity that has one or more executive officers serving as a member of our Board or CC.
Compensation Committee Report
The Compensation Committee of the Board of Directors oversees the compensation programs of NVIDIA on behalf of the Board of Directors. In fulfilling its oversight responsibilities, the Compensation Committee reviewed and discussed with management the Compensation Discussion and Analysis included in this proxy statement.
In reliance on the review and discussions referred to above, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the Annual Report on Form 10-K of NVIDIA for the year ended January 31, 2021 and in this proxy statement.
Compensation Committee
Robert K. Burgess
Tench Coxe
Persis S. Drell
Harvey C. Jones
Proposal 3—Ratification of the Selection of Independent Registered Public Accounting Firm for Fiscal 2022
|
|
|
What am I voting on? Ratification of the selection of PwC as our independent registered public accounting firm for Fiscal 2022.
Vote required: A majority of the shares present or represented by proxy.
Effect of abstentions: Same as a vote AGAINST.
Effect of broker non-votes: None (because this is a routine proposal, there are no broker non-votes).
|
The AC has selected PwC, which has audited our financial statements annually since 2004, to serve as our independent registered public accounting firm for Fiscal 2022. Our lead audit partner at PwC serves no more than five consecutive years in that role. Stockholder ratification of the AC’s selection of PwC is not required by our Bylaws or any other governing documents or laws. As a matter of good corporate governance, we are submitting the selection of PwC to our stockholders for ratification. If our stockholders do not ratify the selection, the AC will reconsider whether or not to retain PwC. Even if the selection is ratified, the AC in its sole discretion may direct the appointment of a different independent registered public accounting firm at any time during the fiscal year if it determines that such a change would be in our best interests and those of our stockholders. The AC believes it is in the best interests of NVIDIA and our stockholders to retain PwC.
We expect that a representative of PwC will attend the 2021 Meeting. The PwC representative will have an opportunity to make a statement at the 2021 Meeting if he or she so desires and will also be available to respond to appropriate stockholder questions.
Recommendation of the Board
The Board recommends that you vote FOR the ratification of the selection of PwC as our independent registered accounting firm for our fiscal year ending January 30, 2022.
Fees Billed by the Independent Registered Public Accounting Firm
The following is a summary of fees billed by PwC for Fiscal 2021 and 2020 for audit, tax and other professional services during each fiscal year:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2021
|
|
Fiscal 2020
|
Audit Fees (1)
|
|
$
|
6,283,381
|
|
|
$
|
5,028,120
|
|
Tax Fees (2)
|
|
609,281
|
|
|
208,062
|
|
All Other Fees (3)
|
|
7,200
|
|
|
4,500
|
|
Total Fees
|
|
$
|
6,899,862
|
|
|
$
|
5,240,682
|
|
(1)Audit fees include fees for the audit of our consolidated financial statements, including business combination activities during the year, the audit of our internal control over financial reporting, reviews of our quarterly financial statements and annual report, reviews of SEC registration statements and related consents, review of an SEC filing for public debt financing and related comfort letter, and fees related to statutory audits of some of our international entities.
(2)Tax fees consisted of fees for tax compliance and consultation services.
(3)All other fees consisted of fees for products or services other than those included above, including payment to PwC related to the use of accounting research software and an industry report.
All of the services provided for Fiscal 2021 and 2020 described above were pre-approved by the AC or the Chairperson of the AC through the authority granted to him by the AC, which is described below. Our AC determined that the rendering of services other than audit services by PwC was compatible with maintaining PwC’s independence.
Pre-Approval Policies and Procedures
The AC has adopted policies and procedures for the pre-approval of all audit and permissible non-audit services rendered by our independent registered public accounting firm. The policy generally permits pre-approvals of specified permissible services in the defined categories of audit services, audit-related services and tax services up to specified amounts. Pre-approval may also be given as part of the AC’s approval of the scope of the engagement of our independent registered public accounting firm or on an individual case-by-case basis before the independent registered public accounting firm is engaged to provide each service. In some cases the full AC provides pre-approval for up to a year related to a particular defined task or scope. In other cases, the AC has delegated power to Mr. McCaffery, the Chairperson of our AC, to pre-approve additional non-audit services if the need for the service was unanticipated and approval is required prior to the next scheduled meeting of the AC. Mr. McCaffery then communicates such pre-approval to the full AC at its next meeting.
Report of the Audit Committee of the Board of Directors
The material in this report is not “soliciting material,” is not deemed “filed” with the SEC and is not to be incorporated by reference in any of our filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, except to the extent specifically incorporated by reference therein.
The Audit Committee, or AC, oversees accounting, financial reporting, internal control over financial reporting, financial practices and audit activities of NVIDIA and its subsidiaries. The AC reviews the results and scope of the audit and other services provided by the independent registered public accounting firm and reviews financial statements and the accounting policies followed by NVIDIA prior to the issuance of the financial statements with both management and the independent registered public accounting firm.
Management is responsible for the financial reporting process, the preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States, or GAAP, the system of internal control over financial reporting, and the procedures designed to facilitate compliance with accounting standards and applicable laws and regulations. PricewaterhouseCoopers LLP, or PwC, our independent registered public accounting firm for Fiscal 2021, was responsible for performing an independent audit of the consolidated financial statements and issuing a report on the consolidated financial statements and of the effectiveness of our internal control over financial reporting as of January 31, 2021. PwC’s judgments as to the quality, not just the acceptability, of our accounting principles and such other matters are required to be disclosed to the AC under applicable standards. The AC oversees these processes. Also, the AC has ultimate authority and responsibility to select, evaluate and, when appropriate, terminate the independent registered public accounting firm. The AC approves audit fees and non-audit services provided by and fees paid to the independent registered public accounting firm.
NVIDIA has an internal audit function that reports to the AC. This function is responsible for objectively reviewing and evaluating the adequacy, effectiveness and quality of our system of internal controls and the operating effectiveness of our business processes. The AC approves an annual internal audit plan and monitors the activities and performance of our internal audit function throughout the year to ensure the plan objectives are carried out and met.
The AC members are not professional accountants or auditors, and their functions are not intended to duplicate or to certify the activities of management or the independent registered public accounting firm. The AC does not plan or conduct audits, determine that our financial statements are complete and accurate and in accordance with GAAP or assess our internal control over financial reporting. The AC relies, without additional independent verification, on the information provided by our management and on the representations made by management that the financial statements have been prepared with integrity and objectivity, and the opinion of PwC that such financial statements have been prepared in conformity with GAAP.
In this context, the AC reviewed and discussed the audited consolidated financial statements for Fiscal 2021 with management and our internal control over financial reporting with management and PwC. Specifically, the AC discussed with PwC the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board and the SEC. We have received from PwC the written disclosures and letter required by the applicable requirements of the Public Company Accounting Oversight Board regarding PwC’s communications with the AC concerning independence. The AC also considered whether the provision of certain permitted non-audit services by PwC is compatible with PwC’s independence and discussed PwC’s independence with PwC.
Based on the AC’s review and discussions, the AC recommended to the Board of Directors that the audited consolidated financial statements be included in the Annual Report on Form 10-K of NVIDIA for the fiscal year ended January 31, 2021.
|
|
|
AUDIT COMMITTEE
|
|
Dawn Hudson
|
Michael G. McCaffery
|
Mark L. Perry
|
A. Brooke Seawell
|
Mark A. Stevens
|