exv10w8
Exhibit 10.8
CONSTANT CONTACT, INC.
2007 EMPLOYEE STOCK PURCHASE PLAN
The purpose of this Plan is to provide eligible employees of Constant Contact, Inc. (the
“Company”) and certain of its subsidiaries with opportunities to purchase shares of the Company’s
common stock, $0.01 par value (the “Common Stock”),
commencing on January 1, 2008. Three Hundred and Fifty Thousand
(350,000) shares of Common Stock in the aggregate have been approved for this purpose. This Plan
is intended to qualify as an “employee stock purchase plan” as defined in Section 423 of the
Internal Revenue Code of 1986, as amended (the “Code”), and the regulations promulgated thereunder,
and shall be interpreted consistent therewith.
1. Administration. The Plan will be administered by the Company’s Board of Directors
(the “Board”) or by a Committee appointed by the Board (the “Committee”). The Board or the
Committee has authority to make rules and regulations for the administration of the Plan and its
interpretation and decisions with regard thereto shall be final and conclusive.
2. Eligibility. All employees of the Company, including Directors who are employees,
and all employees of any subsidiary of the Company (as defined in Section 424(f) of the Code)
designated by the Board or the Committee from time to time (a “Designated Subsidiary”), are
eligible to participate in any one or more of the offerings of Options (as defined in Section 9) to
purchase Common Stock under the Plan provided that:
(a) they are customarily employed by the Company or a Designated Subsidiary for more
than 30 hours a week and for more than five months in a calendar year; and
(b) they have been employed by the Company or a Designated Subsidiary for at least
three months prior to enrolling in the Plan; and
(c) they are employees of the Company or a Designated Subsidiary on the first day of
the applicable Plan Period (as defined below).
No employee may be granted an option hereunder if such employee, immediately after the option
is granted, owns 5% or more of the total combined voting power or value of the stock of the Company
or any subsidiary. For purposes of the preceding sentence, the attribution rules of Section 424(d)
of the Code shall apply in determining the stock ownership of an employee, and all stock which the
employee has a contractual right to purchase shall be treated as stock owned by the employee.
3. Offerings. The Company will make one or more offerings (“Offerings”) to employees
to purchase stock under this Plan. Offerings will begin each January 1 and July 1, or
the first business day thereafter (the “Offering Commencement Dates”). Each Offering
Commencement Date will begin a six month period (a “Plan Period”) during which payroll deductions
will be made and held for the purchase of Common Stock at the end of the Plan Period. The Board or
the Committee may, at its discretion, choose a different Plan Period of twelve (12) months or less
for subsequent Offerings.
4. Participation. An employee eligible on the Offering Commencement Date of any
Offering may participate in such Offering by completing and forwarding a payroll deduction
authorization form to the employee’s appropriate payroll office at least 20 days prior to the
applicable Offering Commencement Date. The form will authorize a regular payroll deduction from
the Compensation received by the employee during the Plan Period. Unless an employee files a new
form or withdraws from the Plan, the employee’s deductions and purchases will continue at the same rate for
future Offerings under the Plan as long as the Plan remains in effect. The term “Compensation”
means the amount of money reportable on the employee’s Federal Income Tax Withholding Statement,
excluding allowances and reimbursements for expenses such as relocation allowances for travel
expenses, income or gains associated with the grant or vesting of restricted stock, income or gains
on the exercise of Company stock options or stock appreciation rights, and similar items, whether
or not shown on the employee’s Federal Income Tax Withholding Statement, but including, in the case
of salespersons, sales commissions to the extent determined by the Board or the Committee.
5. Deductions. The Company will maintain payroll deduction accounts for all
participating employees. With respect to any Offering made under this Plan, an employee may
authorize a payroll deduction in any dollar amount up to a maximum of 10% of the Compensation he or
she receives during the Plan Period or such shorter period during which deductions from payroll are
made. The Board or the Committee may, at its discretion, designate a lower maximum contribution
rate. Payroll deductions may be at the rate of 1%, 2%, 3%, 4%, 5%, 6%, 7%, 8%, 9% or 10% of
Compensation with any change in compensation during the Plan Period to result in an automatic
corresponding change in the dollar amount withheld. The minimum payroll deduction is such
percentage of compensation as may be established from time to time by the Board or the Committee.
6. Deduction
Changes. An employee may decrease or discontinue his or her payroll deduction
once during any Plan Period, by filing a new payroll deduction authorization form. However, an
employee may not increase his or her payroll deduction during a Plan Period. If an employee elects to
discontinue his or her payroll deductions during a Plan Period, but
does not elect to withdraw the funds
pursuant to Section 8 hereof, funds deducted prior to the election to discontinue will be applied
to the purchase of Common Stock on the Exercise Date (as defined below).
- 2 -
7. Interest. Interest will not be paid on any employee accounts, except to the extent
that the Board or the Committee, in its sole discretion, elects to credit employee accounts with
interest at such per annum rate as it may from time to time determine.
8. Withdrawal of Funds. An employee may at any time prior to the close of business on
the last business day in a Plan Period and for any reason permanently draw out the balance
accumulated in the employee’s account and thereby withdraw from participation in an Offering.
Partial withdrawals are not permitted. The employee may not begin participation again during the
remainder of the Plan Period. The employee may participate in any subsequent Offering in
accordance with terms and conditions established by the Board or the Committee.
9. Purchase of Shares.
(a) Number of Shares. On the Offering Commencement Date of each Plan Period, the
Company will grant to each eligible employee who is then a participant in the Plan an option (an
“Option”) to purchase on the last business day of such Plan Period (the “Exercise Date”) at the
applicable purchase price (the “Option Price”) the largest number of whole shares of Common Stock
of the Company as does not exceed the employee’s accumulated payroll deductions as of the Exercise
Date divided by the Option Price for such Plan Period; provided, however, that no employee may be
granted an Option which permits his or her rights to purchase Common Stock under this Plan and any other
employee stock purchase plan (as defined in Section 423(b) of the Code) of the Company and its
subsidiaries, to accrue at a rate which exceeds $25,000 of the fair market value of such Common
Stock for each calendar year in which the Option is outstanding at any time.
(b) Option Price. The Board or the Committee shall determine the Option Price for each
Plan Period, including whether such Option Price shall be determined based on the lesser of (i) the
closing price of the Common Stock on the first business day of the Plan Period or (ii) the Exercise
Date, or shall be based solely on the closing price of the Common Stock on the Exercise Date;
provided, however, that such Option Price shall be at least 85% of the applicable closing price.
In the absence of a determination by the Board or the Committee, the Option Price will be 85% of
the closing price of the Common Stock on the Exercise Date. The closing price shall be (a) the
closing price on any national securities exchange on which the Common Stock is listed, (b) the
closing price of the Common Stock on the Nasdaq Global Market or (c) the average of the closing bid
and asked prices in the over-the-counter-market, whichever is applicable, as published in The
Wall Street Journal. If no sales of Common Stock were made on such a day, the price of the
Common Stock for purposes of clauses (a) and (b) above shall be the reported price for the next
preceding day on which sales were made.
(c)
Exercise of Option. Each employee who continues to be a participant in the Plan on
the Exercise Date shall be deemed to have exercised his or her Option at the Option Price
- 3 -
on such date and shall be deemed to have purchased from the Company the number of whole shares
of Common Stock reserved for the purpose of the Plan that his or her accumulated payroll deductions on
such date will pay for, but not in excess of the maximum number determined in the manner set forth
above.
(d) Return of Unused Payroll Deductions. Any balance remaining in an employee’s
payroll deduction account at the end of a Plan Period will be automatically refunded to the
employee, except that any balance which is less than the purchase price of one share of Common
Stock will be carried forward into the employee’s payroll deduction account for the following
Offering, unless the employee elects not to participate in the following Offering under the Plan,
in which case the balance in the employee’s account shall be refunded.
10. Issuance of Certificates. Certificates representing shares of Common Stock
purchased under the Plan may be issued only in the name of the employee, in the name of the
employee and another person of legal age as joint tenants with rights of survivorship, or (in the
Company’s sole discretion) in the name of a brokerage firm, bank, or other nominee holder
designated by the employee. The Company may, in its sole discretion and in compliance with
applicable laws, authorize the use of book entry registration of shares in lieu of issuing stock
certificates.
11. Rights on Retirement, Death or Termination of Employment. In the event of a
participating employee’s termination of employment prior to the last business day of a Plan Period,
no payroll deduction shall be taken from any pay due and owing to an employee and the balance in
the employee’s account shall be paid to the employee or, in the event of the employee’s death, (a)
to a beneficiary previously designated in a revocable notice signed by the employee (with any
spousal consent required under state law) or (b) in the absence of such a designated beneficiary,
to the executor or administrator of the employee’s estate or (c) if no such executor or
administrator has been appointed to the knowledge of the Company, to such other person(s) as the
Company may, in its discretion, designate. If, prior to the last business day of the Plan Period,
the Designated Subsidiary by which an employee is employed shall cease to be a subsidiary of the
Company, or if the employee is transferred to a subsidiary of the Company that is not a Designated
Subsidiary, the employee shall be deemed to have terminated employment for the purposes of this
Plan.
12. Optionees Not Stockholders. Neither the granting of an Option to an employee nor
the deductions from his or her pay shall constitute such employee a stockholder of the shares of Common
Stock covered by an Option under this Plan until such shares have been purchased by and issued to
the employee.
13. Rights Not Transferable. Rights under this Plan are not transferable by a
participating employee other than by will or the laws of descent and distribution, and are
exercisable during the employee’s lifetime only by the employee.
- 4 -
14. Application of Funds. All funds received or held by the Company under this Plan
may be combined with other corporate funds and may be used for any corporate purpose.
15. Adjustment for Changes in Common Stock and Certain Other Events.
(a) Changes in Capitalization. In the event of any stock split, reverse stock split,
stock dividend, recapitalization, combination of shares, reclassification of shares, spin-off or
other similar change in capitalization or event, or any distribution to holders of Common Stock
other than an ordinary cash dividend, (i) the number and class of securities available under this
Plan, (ii) the share limitations set forth in Section 9, and (iii) the Option Price shall be
appropriately adjusted to the extent determined by the Board or the Committee.
(b) Reorganization Events.
(1) Definition. A “Reorganization Event” shall mean: (a) any merger or consolidation
of the Company with or into another entity as a result of which all of the Common Stock of the
Company is converted into or exchanged for the right to receive cash, securities or other property
or is cancelled, (b) any exchange of all of the Common Stock of the Company for cash, securities or
other property pursuant to a share exchange transaction or (c) any liquidation or dissolution of
the Company.
(2) Consequences of a Reorganization Event on Options. In connection with a
Reorganization Event, the Board or the Committee shall take any one or more of the following
actions as to outstanding Options on such terms as the Board or the Committee determines: (i)
provide that Options shall be assumed, or substantially equivalent Options shall be substituted, by
the acquiring or succeeding corporation (or an affiliate thereof), (ii) upon written notice to
employees, provide that all outstanding Options will be terminated as of the effective date of the
Reorganization Event and that all such outstanding Options will become exercisable to the extent of
accumulated payroll deductions as of a date specified by the Board or the Committee in such notice,
which date shall not be less than ten (10) days preceding the effective date of the Reorganization
Event, (iii) upon written notice to employees, provide that all outstanding Options will be
cancelled as of a date prior to the effective date of the Reorganization Event and that all
accumulated payroll deductions will be returned to participating employees on such date, (iv) in
the event of a Reorganization Event under the terms of which holders of Common Stock will receive
upon consummation thereof a cash payment for each share surrendered in the Reorganization Event
(the “Acquisition Price”), make or provide for a cash payment to an employee equal to (A) the
Acquisition Price times the number of shares of Common Stock subject to the employee’s Option (to
the extent the Option Price does not exceed the Acquisition Price) minus (B) the aggregate Option
Price of such Option, in exchange for the termination of such Option, (v) provide that, in
connection with a liquidation or
- 5 -
dissolution of the Company, Options shall convert into the right to receive liquidation proceeds
(net of the Option Price thereof) and (vi) any combination of the foregoing.
For purposes of clause (i) above, an Option shall be considered assumed if, following
consummation of the Reorganization Event, the Option confers the right to purchase, for each share
of Common Stock subject to the Option immediately prior to the consummation of the Reorganization
Event, the consideration (whether cash, securities or other property) received as a result of the
Reorganization Event by holders of Common Stock for each share of Common Stock held immediately
prior to the consummation of the Reorganization Event (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of the outstanding
shares of Common Stock); provided, however, that if the consideration received as a result of the
Reorganization Event is not solely common stock of the acquiring or succeeding corporation (or an
affiliate thereof), the Company may, with the consent of the acquiring or succeeding corporation,
provide for the consideration to be received upon the exercise of Options to consist solely of
common stock of the acquiring or succeeding corporation (or an affiliate thereof) equivalent in
value (as determined by the Board) to the per share consideration received by holders of
outstanding shares of Common Stock as a result of the Reorganization Event.
16. Amendment of the Plan. The Board may at any time, and from time to time, amend
this Plan in any respect, except that (a) if the approval of any such amendment by the stockholders
of the Company is required by Section 423 of the Code, such amendment shall not be effected without
such approval, and (b) in no event may any amendment be made which would cause the Plan to fail to
comply with Section 423 of the Code.
17. Insufficient Shares. In the event that the total number of shares of Common Stock
specified in elections to be purchased under any Offering plus the number of shares purchased under
previous Offerings under this Plan exceeds the maximum number of shares issuable under this Plan,
the Board or the Committee will allot the shares then available on a pro-rata basis.
18. Termination of the Plan. This Plan may be terminated at any time by the Board.
Upon termination of this Plan all amounts in the accounts of participating employees shall be
promptly refunded.
19. Governmental Regulations. The Company’s obligation to sell and deliver Common
Stock under this Plan is subject to listing on a national stock exchange or quotation on the Nasdaq
Global Market (to the extent the Common Stock is then so listed or quoted) and the approval of all
governmental authorities required in connection with the authorization, issuance or sale of such
stock.
20. Governing
Law. The Plan shall be governed by the laws of the state of
Delaware, except to the extent
that such law is preempted by federal law.
- 6 -
21. Issuance of Shares. Shares may be issued upon exercise of an Option from
authorized but unissued Common Stock, from shares held in the treasury of the Company, or from any
other proper source.
22. Notification upon Sale of Shares. Each employee agrees, by entering the Plan, to
promptly give the Company notice of any disposition of shares purchased under the Plan where such
disposition occurs within two years after the date of grant of the Option pursuant to which such
shares were purchased.
23. Withholding. Each employee shall, no later than the date of the event creating the
tax liability, make provision satisfactory to the Board for payment of any taxes required by law to
be withheld in connection with any transaction related to Options granted to or shares acquired by
such employee pursuant to the Plan. The Company may, to the extent permitted by law, deduct any
such taxes from any payment of any kind otherwise due to an employee.
24. Effective Date and Approval of Stockholders. The Plan shall take effect on
January 1, 2008 subject to approval by the stockholders of the Company as required by Section 423
of the Code, which approval must occur within twelve months of the adoption of the Plan by the
Board.
Adopted by
the Board of Directors on
September ___ , 2007
Approved
by the stockholders on September ___ , 2007
- 7 -