Exhibit 10.3
CONSTANT CONTACT, INC.
2007 STOCK INCENTIVE PLAN
RESTRICTED STOCK UNIT AGREEMENT
(Performance-Based Vesting)
     AGREEMENT made between Constant Contact, Inc., a Delaware corporation (the
“Company”), and Harpreet S. Grewal (“you”).
     For valuable consideration, receipt of which is acknowledged, the Company
and you agree as follows:
     1. Grant of RSUs.
          On September 1, 2010 and subject to the terms and conditions set forth
in this Agreement and in the Constant Contact, Inc. 2007 Stock Incentive Plan
(the “Plan”), the Company has granted you Restricted Stock Units (“RSUs”)
providing you with the right to receive 20,000 shares of common stock (“Common
Stock”), $0.01 par value per share, of the Company (the “Shares”).
     2. Vesting and Forfeiture.
          (a) The RSUs will be subject to performance vesting based on the
Company achieving a monthly revenue run rate of more than $41,666,666 in any
calendar month (the “Performance Goal”) between your Employment Date and
December 31, 2014. Your “Employment Date” means July 6, 2010, the date on which
your employment with the Company commenced. If the Company does not satisfy the
Performance Goal before December 31, 2014, or you cease to be employed at any
time before the Compensation Committee of the Company’s Board of Directors (the
“Committee”) determines that the Performance Goal has been met, the RSUs will
then be immediately forfeited without payment and cease to be outstanding. The
Committee will have the sole discretion to determine whether the Performance
Goal has been met and will review the appropriate documentation to reach that
determination on or around the 15th day following the last day of each calendar
quarter, with the vesting occurring when the Committee concludes that the
Performance Goal has been met with respect to any month in the preceding
quarter. You must remain employed as of such date of determination to vest in
the RSUs. The date upon which any of the RSUs vest will be considered a “Vesting
Date” for the RSUs that vest on that date. If applicable, any fractional Shares
that would otherwise vest as of a particular date will be rounded down and
carried forward to the next Vesting Date until a whole Share can be issued.
          (b) In the event of a Change of Control (as defined below),
notwithstanding anything herein to the contrary, immediately prior to the
closing of the Change of Control, 50% of the then outstanding and unvested RSUs
shall automatically vest and the date on which the closing of such Change of
Control occurs shall be a Vesting Date for purposes of this Agreement. Any then
outstanding and unvested RSUs (after giving effect to the foregoing sentence)
shall continue to vest as set forth in Section 2(a) above until 100% of the RSUs
are vested, subject to the continuation of your employment or other service
providing relationship with the Company.

 

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          (c) If, following a Change of Control, your employment or other
service providing relationship with the Company is terminated by the Company
without Cause (as defined below) prior to the one year anniversary of the date
on which the closing of such Change of Control occurs, 100% of the then
outstanding and unvested RSUs shall automatically vest and the effective date of
the termination of your employment or other service providing relationship shall
be a Vesting Date for purposes of this Agreement. Notwithstanding the foregoing,
and solely to the extent necessary to avoid the penalty provisions under
Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”),
if the Vesting Date occurs because of your termination of employment and if the
Company determines that you are a “specified employee” as defined under
Section 409A, then the distribution of newly vested Shares shall be delayed
until the earlier of (i) the date that is six months plus one day after the date
of termination and (ii) the 10th day after your date of death.
          (d) Absent any contrary provision in the Plan or any other applicable
plan or agreement, if you cease to be employed by, or engaged to provide
services on an individual basis to, the Company for any reason or no reason, you
will immediately and automatically forfeit all rights to any of your RSUs that
have Vesting Dates after the date your employment or other service providing
relationship with the Company ends.
          (e) For the purposes of this Agreement:
               (i) “Change of Control” shall mean (i) the consolidation or
merger of the Company with or into any other corporation or other entity (other
than a merger or consolidation in which all or substantially all of the
individuals and entities who were beneficial owners of the outstanding
securities entitled to vote generally in the election of directors of the
Company immediately prior to such transaction beneficially own, directly or
indirectly, more than 50% of the outstanding securities entitled to vote
generally in the election of directors of the resulting, surviving or acquiring
corporation in such transaction), (ii) the sale of all or substantially all of
the properties and assets of the Company as an entirety to any other person, or
(iii) the sale or transfer, in a single transaction or series of related
transactions, of outstanding capital stock representing at least a majority of
the voting power of the outstanding capital stock of the Company immediately
following such transaction; provided that if any portion of the RSUs is then
subject to Section 409A, any resulting distribution of the covered shares will
be delayed to comply with Section 409A unless the Change of Control is also a
change in ownership or effective control of the Company (within the meaning of
Treasury Regulation Section 1.409A-3(g)(5) or any successor regulation.
               (ii) “Cause” shall mean willful misconduct by you relating to
your duties to the Company, or willful failure by you to perform your
responsibilities to the Company (including, without limitation, breach by you of
any provision of any nondisclosure, non-competition or other similar written
agreement between you and the Company), as determined by the Company. No act or
failure to act by you shall be considered willful unless it is done, or omitted
to be done, in bad faith or without a reasonable belief by you that your actions
or omissions were in the best interests of the Company.

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     3. Issuance of Shares.
          Subject to the terms and conditions of this Agreement (including any
Withholding Tax obligations), after each Vesting Date, the Company will issue to
you (or your estate, or an account at a brokerage firm designated by the
Company), within three (3) business days following such Vesting Date, one Share
for each RSU that vested on such Vesting Date. Until each applicable Vesting
Date, you will have no rights to any Shares, and until the Company delivers the
Shares to you, you will not have any rights associated with such Shares,
including without limitation voting rights, dividends or dividend equivalents.
     4. Transferability.
          The RSUs and Shares they represent may not be sold, assigned,
transferred, pledged, hypothecated or otherwise disposed of (whether by
operation of law or otherwise) (collectively, a “transfer”), except that this
Agreement may be transferred by the laws of descent and distribution or as
otherwise permitted under the Plan. You may only transfer the Shares that may be
issued pursuant to this Agreement following a Vesting Date that covers them.
     5. Withholding Taxes.
          (a) You acknowledge that you have reviewed with your own tax advisors
the federal, state, local and foreign tax consequences of this investment and
the actions contemplated by this Agreement. You affirm that you are relying
solely on such advisors and not on any statements or representations of the
Company or any of its agents.
          (b) The Company’s obligation to deliver Shares to you upon or after
the vesting of the RSUs shall be subject to your satisfaction of all income tax
(including federal, state and local taxes), social insurance, payroll tax,
payment on account or other tax related withholding requirements, as determined
by the Company (“Withholding Taxes”).
          (c) You acknowledge and agree that the Company has the right to deduct
from payments of any kind otherwise due to you any Withholding Taxes to be
withheld with respect to the actions contemplated by this Agreement.
          (d) Without limiting the generality of the foregoing Section 5(c),
except as provided in the next sentence, the Company shall withhold a number of
Shares issuable in payment of any vested RSUs having a Fair Market Value, as of
the Vesting Date of such RSUs, equal to the Withholding Taxes with respect to
such RSUs. If the Company cannot (under applicable legal, regulatory, listing or
other requirements, or otherwise) satisfy such Withholding Taxes in such method,
the Company may satisfy such Withholding Taxes by any one or combination of the
following methods: (i) by requiring you to pay such Withholding Taxes in cash or
by check; (ii) by deducting such Withholding Taxes out of any other compensation
otherwise payable to you by the Company; and/or (iii) by allowing you to
surrender shares of Common Stock which (x) in the case of shares initially
acquired from the Company (upon exercise of a stock option or otherwise), have
been owned by you for such period (if any) as may be required to avoid a charge
to the Company’s earnings, and (y) have a Fair Market Value on the date of
surrender equal to such Withholding Taxes. The Company is hereby authorized to
take such actions as are necessary to effect the withholding of any and all such
Withholding

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Taxes in accordance with this Section 5(d). For purposes of this Section 5(d),
the “Fair Market Value” of a Share as of any date shall be equal to the last
reported sale price of the Common Stock on the NASDAQ Stock Market (or any other
stock exchange or over-the-counter market on which the Company’s Common Stock is
then traded) on such date.
     6. Securities Laws.
          Notwithstanding any other provision of the Plan or this Agreement, the
Company will not be required to issue, and you may not sell, assign, transfer or
otherwise dispose of, any shares of Common Stock received as payment of the
RSUs, unless (a) there is in effect with respect to the shares of Common Stock
received as payment of the RSUs a registration statement under the Securities
Act of 1933, as amended, and any applicable state or foreign securities laws or
an exemption from such registration, and (b) there has been obtained any other
consent, approval or permit from any other regulatory body that the Compensation
Committee (the “Committee”) of the Company’s Board of Directors, in its sole
discretion, deems necessary or advisable. The Company may condition such
issuance, sale or transfer upon the receipt of any representations or agreements
from the parties involved, and the placement of any legends on certificates
representing Common Stock received as payment of the RSUs, as may be deemed
necessary or advisable by the Company to comply with such securities law or
other restrictions.
     7. Provisions of the Plan.
          This Agreement is subject to the provisions of the Plan, a copy of
which is furnished to you with this Agreement. Any capitalized terms used in
this Agreement but not otherwise defined in the Agreement shall have the same
meaning as in the Plan.
     8. Miscellaneous.
          (a) Section 409A. This Agreement is intended to comply with the
requirements of Section 409A and shall be construed consistently therewith. In
any event, the Company makes no representation or warranty and will have no
liability to you or any other person, other than with respect to payments made
by the Company in violation of the provisions of this Agreement, if any
provisions of or payments under this Agreement are determined to constitute
deferred compensation subject to Section 409A but not to satisfy the conditions
of that section.
          (b) Unsecured Creditor. This Agreement shall create a contractual
obligation on the part of Company to make payment of the RSUs credited to your
account at the time provided for in this Agreement. Neither you nor any other
party claiming an interest in the RSUs or related stock hereunder shall have any
interest whatsoever in any specific assets of the Company. Your right to receive
payments hereunder shall be that of an unsecured general creditor of Company.
          (c) Severability. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, and each other provision of this Agreement shall be
severable and enforceable to the extent permitted by law.

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          (d) Waiver. Any provision for the benefit of the Company contained in
this Agreement may be waived, either generally or in any particular instance, by
the Board of Directors of the Company or the Committee.
          (e) Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the Company and you and its and your respective heirs, executors,
administrators, legal representatives, successors and assigns, subject to the
restrictions on transfer set forth in Section 4 of this Agreement.
          (f) Notice. Except as provided in Section 8(i), all notices required
or permitted hereunder shall be in writing or provided and deemed effectively
given upon personal delivery or five calendar days after deposit in the United
States Post Office, by registered or certified mail, postage prepaid, addressed
to the other party hereto at, for the Company, its primary business address
(attention: Chief Human Resources Officer / General Counsel) and, for you, at
your home address as reflected in the records of the Company, or at such other
address or addresses as either party shall designate to the other in accordance
with this Section 8(f).
          (g) Entire Agreement. This Agreement and the Plan constitute the
entire agreement between the parties, and supersede all prior agreements and
understandings, relating to the subject matter of this Agreement.
          (h) Governing Law. This Agreement shall be construed, interpreted and
enforced in accordance with the internal laws of the State of Delaware without
regard to any applicable conflicts of laws.
          (i) Electronic Delivery. The Company may, in its sole discretion,
decide to deliver any documents related to participation in the Plan or awards
granted under the Plan by electronic means or to request your consent to
participate in the Plan by electronic means or allow you to provide notices by
electronic means. You hereby consent to receive such documents by electronic
delivery and, if requested, to agree to participate in the Plan through an
on-line or electronic system established and maintained by the Company or
another third party designated by the Company.
          (j) Your Acknowledgments. You acknowledge that you: (i) have read this
Agreement; (ii) have been represented in the preparation, negotiation and
execution of this Agreement by legal counsel of your own choice or have
voluntarily declined to seek such counsel; (iii) understand the terms and
consequences of this Agreement; and (iv) are fully aware of the legal and
binding effect of this Agreement.
[Signatures on Page Following]

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            CONSTANT CONTACT, INC.
      By:   (SIGNATURE) [b83269b8326900.gif]        Gail F. Goodman
C.E.O.     

PARTICIPANT’S ACCEPTANCE
     By signing below (or by accepting the foregoing grant through such other
means as may be established by the Company or any third-party administrator used
by the Company, from time to time, including, without limitation, via any such
third-party administrator’s Internet website), I hereby accept the foregoing
grant and agree to the terms and conditions thereof and acknowledge receipt of a
copy of the Company’s 2007 Stock Incentive Plan.

            PARTICIPANT
      /s/ Harpreet S. Grewal      Print Name:  Harpreet S. Grewal        Date: 
9/1/2010    

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