Salesforce.com 2004 Annual Report Download - page 90

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(f) "Director" means a member of the Board or of the board of directors of any other Participating Company.
(g) "Disability" means the inability of the Optionee, in the opinion of a qualified physician acceptable to the Company, to perform the
major duties of the Optionee's position with the Participating Company Group because of the sickness or injury of the Optionee.
(h) "Employee" means any person treated as an employee (including an officer or a Director who is also treated as an employee) in the
records of a Participating Company and, with respect to any Incentive Stock Option granted to such person, who is an employee for purposes of
Section 422 of the Code; provided, however, that neither service as a Director nor payment of a director's fee shall be sufficient to constitute
employment for purposes of the Plan.
(i) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(j) "Fair Market Value" means, as of any date, the value of a share of Stock or other property as determined by the Board, in its discretion,
or by the Company, in its discretion, if such determination is expressly allocated to the Company herein, subject to the following:
(i) If, on such date, the Stock is listed on a national or regional securities exchange or market system, the Fair Market Value of a
share of Stock shall be the closing price of a share of Stock (or the mean of the closing bid and asked prices of a share of Stock if the
Stock is so quoted instead) as quoted on the Nasdaq National Market, The Nasdaq SmallCap Market or such other national or regional
securities exchange or market system constituting the primary market for the Stock, as reported in The Wall Street Journal or such other
source as the Company deems reliable. If the relevant date does not fall on a day on which the Stock has traded on such securities
exchange or market system, the date on which the Fair Market Value shall be established shall be the last day on which the Stock was so
traded prior to the relevant date, or such other appropriate day as shall be determined by the Board, in its discretion.
(ii) If, on such date, there is no public market for the Stock, the Fair Market Value of a share of Stock shall be as determined by the
Board in good faith without regard to any restriction other than a restriction which, by its terms, will never lapse.
(k) "Incentive Stock Option" means an Option intended to be (as set forth in the Option Agreement) and which qualifies as an incentive
stock option within the meaning of Section 422(b) of the Code.
(l) "Insider" means an officer or a Director of the Company or any other person whose transactions in Stock are subject to Section 16 of
the Exchange Act.
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