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That sounds suspect to me. The company I work for gives 90 days + 1 month for every 1 month over a year you work there (so work there 2 years and you have 1 year, 90 days to exercise after leaving).

Is this arrangement just a loophole?

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Do they keep you employed for that month? It's fairly common to extend your termination date for health insurance and visa reasons. If you aren't actually terminated, the 90 days wouldn't have started.

The sentence was slightly hard to parse so you may have missed that you get an extra month for each month you are employed over 1 year. So the stated example of a 2 year tenure gives 1 year and 90 days to purchase the options.

Indeed, I parsed it incorrectly.

You likely have a clause where they become NSOs after 90 days.

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