NVIDIA Announces Pricing of $1.3 Billion of Convertible Senior Notes

NVIDIA Announces Pricing of $1.3 Billion of Convertible Senior Notes 
Net Proceeds to Primarily Fund Capital Return 
SANTA CLARA, CA -- (Marketwired) -- 11/26/13 --  NVIDIA Corporation
(NASDAQ: NVDA) announced today the pricing of $1.3 billion aggregate
principal amount of convertible senior notes due in 2018. The Company
has also granted the initial purchaser of the notes a 13-day option
to purchase up to an additional $200 million aggregate principal
amount of notes from the Company to cover any over-allotments.  
The notes, which will be general unsecured obligations of the
Company, are being sold in a private offering to qualified
institutional buyers pursuant to Rule 144A under the Securities Act
of 1933. The sale of the notes is expected to close on December 2,
2013, subject to customary closing conditions.  
Interest and Conversion Details
 Interest on the notes will be
payable semi-annually in cash in arrears on June 1 and December 1 of
each year, beginning on June 1, 2014 at a rate of 1.0% per year. The
notes will mature on December 1, 2018, unless earlier repurchased or
converted in accordance with their terms. The initial conversion rate
will be 49.5958 shares of the Company's common stock per $1,000
principal amount of notes (equivalent to an initial conversion price
of approximately $20.16 per share). The initial conversion price
represents a premium of approximately 30% to the $15.51 per share
closing price of the Company's common stock on The NASDAQ Global
Select Market on November 25, 2013.  
Net Proceeds and Their Intended Use
 The Company intends to use the
net proceeds for the repurchase of shares of the Company's common
stock and quarterly dividend payments pursuant to the Company's
recently announced fiscal 2015 capital return program, and general
corporate purposes. 
The Company estimates that the net proceeds from the offering will be
approximately $1.28 billion, or approximately $1.48 billion if the
initial purchaser exercises its over-allotment option in full, after
deducting the initial purchaser's discount and estimated offering
expenses payable by the Company. The Company intends to use $93.6
million of the net proceeds of the offering to fund the cost of the
privately negotiated convertible note hedge transactions (after
taking in
to account the proceeds to it from warrant transactions)
described below.  
The Company also intends to use a portion of the net proceeds of the
offering to repurchase 920,355 shares of its common stock from
purchasers of the notes in privately negotiated transactions effected
through the initial purchaser, as the Company's agent, at a purchase
price of $15.51 per share, which is the closing price of the
Company's common stock on The NASDAQ Global Select Market on November
25, 2013, for a total purchase price of approximately $14.3 million.
While the Company had expected to repurchase up to $200 million of
its common stock from investors in the notes offering, $14.3 million
was the full amount that those investors made available for sale. 
Privately Negotiated Convertible Note Hedge Transactions 
 In
connection with the offering of the notes, the Company has entered
into privately negotiated convertible note hedge and warrant
transactions with the initial purchaser of the notes. These
convertible note hedge transactions are expected to reduce the
potential dilution with respect to the Company's common stock upon
conversion of the notes or offset any cash payments the Company is
required to make in excess of the principal amount of converted
notes, as the case may be, upon any conversion of notes. However, the
warrant transactions could have a dilutive effect with respect to the
Company's common stock to the extent that the market price per share
of the Company's common stock exceeds the strike price of the
warrants. The strike price of the warrant transactions will initially
be approximately $27.14 per share, which represents a premium of
approximately 75% to the closing price of the Company's common stock
on The NASDAQ Global Select Market on November 25, 2013, and is
subject to certain adjustments under the terms of the warrants. If
the initial purchaser exercises its option to purchase additional
notes, the Company may sell additional warrants and intends to use a
portion of the net proceeds from the sale of the additional notes and
additional warrants to enter into additional convertible note hedge
and warrant transactions. 
The Company has been advised that, in connection with establishing
its initial hedge position with respect to the convertible note hedge
and warrant transactions, the initial purchaser expects to purchase
shares of the Company's common stock or enter into various derivative
transactions with respect to the Company's common stock concurrently
with, or shortly after, the pricing of the notes. These hedging
activities could increase (or reduce the size of any decrease in) the
market price of the Company's common stock or the notes.  
In addition, the initial purchaser may modify its hedge position (and
is likely to do so during the observation period related to any
conversion of notes or following a repurchase of notes by the Company
on a fundamental change repurchase date or otherwise) by entering
into or unwinding various derivatives with respect to the Company's
common stock or purchasing or selling common stock or other
securities of the Company in secondary market transactions following
the pricing of the notes and prior to the maturity of the notes. 
General Conditions
 Prior to August 1, 2018, the notes will be
convertible only upon the occurrence of certain events and periods,
and thereafter, the notes will be convertible at any time. The
holders of the notes will have the ability to require the Company to
repurchase all or a portion of their notes for cash in the event of
certain fundamental changes. In such a case, the repurchase price
will be 100% of the principal amount of the notes to be repurchased,
plus any accrued and unpaid interest. In addition, upon certain
make-whole fundamental changes occurring prior to the maturity date
of the notes, the Company will increase the conversion rate for
holders of the notes who convert their notes in connection with that
make-whole fundamental change. 
This announcement does not constitute an offer to sell, or the
solicitation of an offer to buy, any securities. Any offers of the
notes or any shares of the Company's common stock issuable upon
conversion of the notes will be made only by means of a confidential
offering memorandum. The notes, the convertible note hedge
transactions, the warrants and any shares of the Company's common
stock underlying these securities have not been and will not be
registered under the Securities Act of 1933 or the securities laws of
any other jurisdiction and may not be offered or sold in the United
States without registration or an applicable exemption from
registration requirements.  
About NVIDIA
 Since 1993, NVIDIA (NASDAQ: NVDA) has pioneered the art
and science of visual computing. The company's technologies are
transforming a world of displays into a world of interactive
discovery -- for everyone from gamers to scientists, and consumers to
enterprise customers.  
Certain statements in this press release including, but not limited
to, statements as to whether NVIDIA will consummate the offering; the
expected use of proceeds from the offering; the Company's capital
return program; and whether the convertible note hedge and warrant
transactions will become effective a
re forward-looking statements
that are subject to risks and uncertainties that could cause results
to be materially different than expectations. Important factors that
could cause actual results to differ materially are detailed from
time to time in the reports NVIDIA files with the Securities and
Exchange Commission, or SEC, including its Form 10-Q for the fiscal
period ended October 27, 2013. Copies of reports filed with the SEC
are posted on the company's website and are available from NVIDIA
without charge. These forward-looking statements are not guarantees
of future performance and speak only as of the date hereof, and,
except as required by law, NVIDIA disclaims any obligation to update
these forward-looking statements to reflect future events or
circumstances. 
Copyright 2013 NVIDIA Corporation. All rights reserved. NVIDIA and
the NVIDIA logo are trademarks and/or registered trademarks of NVIDIA
Corporation in the U.S. and other countries. Other company and
product names may be trademarks of the respective companies with
which they are associated. Features, pricing, availability and
specifications are subject to change without notice. 
For further information, contact: 
Rob Csongor 
Investor Relations 
NVIDIA Corporation 
(408) 566-6373 
rcsongor@nvidia.com  
Robert Sherbin
Corporate Communications
NVIDIA Corporation
(408) 566-5150
rsherbin@nvidia.com