<PAGE>
Exhibit 10.7
SPEECHWORKS INTERNATIONAL, INC.
2000 EMPLOYEE STOCK PURCHASE PLAN
The following constitute the provisions of the 2000 Employee Stock Purchase
Plan (the "Plan") of SpeechWorks International, Inc. (the "Company").
1. Purpose. The purpose of the Plan is to provide Employees of the
-------
Company and its Designated Subsidiaries with an opportunity to purchase Common
Stock of the Company. It is the intention of the Company to have the Plan
qualify as an "Employee Stock Purchase Plan" under Section 423 of the Internal
Revenue Code of 1986, as amended. The provisions of the Plan shall,
accordingly, be construed so as to extend and limit participation in a manner
consistent with the requirements of that section of the Code.
2. Definitions.
-----------
(a) "Board" shall mean the Board of Directors of the Company, or a
-----
committee of the Board of Directors named by the Board to administer the Plan.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
----
(c) "Common Stock" shall mean the Common Stock, $.001 par value, of the
------------
Company.
(d) "Company" shall mean SpeechWorks International, Inc., a Delaware
-------
corporation.
(e) "Compensation" shall mean all compensation that is taxable income for
------------
federal income tax purposes, including, payments for overtime, shift premium,
incentive compensation, incentive payments, bonuses, commissions and other
compensation.
(f) "Continuous Status as an Employee" shall mean the absence of any
--------------------------------
interruption or termination of service as an Employee. Continuous Status as an
Employee shall not be considered interrupted in the case of a leave of absence
agreed to in writing by the Company, provided that such leave is for a period of
not more than 90 days or reemployment upon the expiration of such leave is
guaranteed by contract or statute.
(g) "Contributions" shall mean all amounts credited to the account of a
-------------
participant pursuant to the Plan.
(h) "Designated Subsidiaries" shall mean the Subsidiaries which have been
-----------------------
designated by the Board from time to time in its sole discretion as eligible to
participate in the Plan.
(i) "Employee" shall mean any person, including an officer, who is
--------
customarily employed for at least 20 hours per week and more than five months in
a calendar year by the Company or one of its Designated Subsidiaries.
(j) "Exercise Date" shall mean the last day of each Offering Period of the
-------------
Plan.
(k) "Offering Date" shall mean the first business day of each Offering
-------------
Period of the Plan.
(l) "Offering Period" shall mean a period of six (6) months commencing on
---------------
March 1 and September 1 of each calendar year, other than the first Offering
Period as set forth in paragraph 4.
<PAGE>
(m) "Plan" shall mean this SpeechWorks International, Inc. 2000 Employee
----
Stock Purchase Plan.
(n) "Subsidiary" shall mean a corporation, domestic or foreign, of which
----------
not less than 50% of the voting shares are held by the Company or a Subsidiary,
whether or not such corporation now exists or is hereafter organized or acquired
by the Company or a Subsidiary.
3. Eligibility.
-----------
(a) Any person who has been continuously employed as an Employee for three
(3) months as of the Offering Date of a given Offering Period shall be eligible
to participate in such Offering Period under the Plan, provided that such person
was not eligible to participate in such Offering Period as of any prior Offering
Date, and further, subject to the requirements of paragraph 5(a) and the
limitations imposed by Section 423(b) of the Code.
(b) Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan (i) if, immediately after the
grant, such Employee (or any other person whose stock would be attributed to
such Employee pursuant to Section 424(d) of the Code) would own stock and/or
hold outstanding options to purchase stock possessing five percent (5%) or more
of the total combined voting power or value of all classes of stock of the
Company or of any Subsidiary of the Company, or (ii) which permits his or her
rights to purchase stock under all employee stock purchase plans (described in
Section 423 of the Code) of the Company and its Subsidiaries to accrue at a rate
which exceeds $25,000 of fair market value of such stock (determined at the time
such option is granted) for each calendar year in which such option is
outstanding at any time. Any option granted under the Plan shall be deemed to be
modified to the extent necessary to satisfy this paragraph (b).
4. Offering Periods. The Plan shall be implemented by a series of
----------------
Offering Periods, with a new Offering Period commencing on March 1 and September
1 of each year (or at such other time or times as may be determined by the Board
of Directors). The initial Offering Period shall commence at a time to be
determined by the Board and continue until February 28, 2001. The Plan shall
continue until terminated in accordance with paragraph 19 hereof. The Board of
Directors of the Company shall have the power to change the duration and/or the
frequency of Offering Periods with respect to future offerings without
stockholder approval if such change is announced at least 15 days prior to the
scheduled beginning of the first Offering Period to be affected.
5. Participation.
-------------
(a) An eligible Employee may become a participant in the Plan by
completing an Enrollment Form provided by the Company and filing it with the
Company prior to the applicable Offering Date, unless a later time for filing
the Enrollment Form is set by the Board for all eligible Employees with respect
to a given Offering Period. The Enrollment Form and their submission may be
electronic, as directed by the Company. The Enrollment Form shall set forth the
percentage of the participant's Compensation (subject to paragraph 6(a) below)
to be paid as Contributions pursuant to the Plan.
(b) Payroll deductions shall commence on the first payroll following the
Offering Date and shall end on the last payroll paid on or prior to the Exercise
Date of the Offering Periods to which the Enrollment Form is applicable, unless
sooner terminated by the participant as provided in paragraph 10.
2
<PAGE>
6. Method of Payment of Contributions.
----------------------------------
(a) A participant shall elect to have payroll deductions made on each
payday during the Offering Period in an amount not less than 1% and not more
than 10% (or such greater percentage as the Board may establish from time to
time before an Offering Date) of such participant's Compensation on each such
payday. All payroll deductions made by a participant shall be credited to his
or her account under the Plan. A participant may not make any additional
payments into such account. A participant may discontinue his or her
participation in the Plan as provided in paragraph 10.
(b) Notwithstanding the foregoing, to the extent necessary to comply with
Section 423(b)(8) of the Code and paragraph 3(b) hereof, a participant's payroll
deductions may be decreased to 0% at such time and for so long as the aggregate
of all payroll deductions accumulated with respect to the current Offering
Period and any other Offering Period ending within the current calendar year
equals $21,250. Payroll deductions shall recommence at the rate provided in
such participant's Enrollment Form at the beginning of the first Offering Period
which is scheduled to end in the following calendar year, unless terminated by
the participant as provided in paragraph 10.
7. Grant of Option.
---------------
(a) On the Offering Date of each Offering Period, each eligible Employee
participating in such Offering Period shall be granted an option to purchase on
the Exercise Date of such Offering Period a number of shares of the Common Stock
determined by dividing such Employee's Contributions accumulated prior to such
Exercise Date and retained in the participant's account as of the Exercise Date
by the lower of (i) 85% of the fair market value of a share of Common Stock on
the Offering Date, or (ii) 85% of the fair market value of a share of the Common
Stock on the Exercise Date; provided however, that such purchase shall be
subject to the limitations set forth in paragraphs 3(b) and 12 hereof. The fair
market value of a share of the Common Stock shall be determined as provided in
paragraph 7(b) herein.
(b) The option price per share of the shares offered in a given Offering
Period shall be the lower of (i) 85% of the fair market value of a share of the
Common Stock on the Offering Date, or (ii) 85% of the fair market value of a
share of the Common Stock on the Exercise Date. The fair market value of the
Common Stock on a given date shall be determined by the Board in its discretion
based on the closing sale price of the Common Stock for such date (or, in the
event that the Common Stock is not traded on such date, on the immediately
preceding trading date), as reported by the National Association of Securities
Dealers Automated Quotation (Nasdaq) National Market or, if such price is not
reported, the mean of the bid and asked prices per share of the Common Stock as
reported by Nasdaq or, in the event the Common Stock is listed on a stock
exchange, the fair market value per share shall be the closing sale price on
such exchange on such date (or, in the event that the Common Stock is not traded
on such date, on the immediately preceding trading date), as reported in The
Wall Street Journal.
8. Exercise of Option. Unless a participant withdraws from the Plan as
------------------
provided in paragraph 10, his or her option for the purchase of shares will be
exercised automatically on the Exercise Date of the Offering Period, and the
maximum number of full shares subject to option will be purchased for him or her
at the applicable option price with the accumulated Contributions in his or her
account. If a fractional number of shares results, then such number shall be
rounded down to the next whole number and any unapplied cash shall be carried
forward to the next Exercise Date, unless the participant requests a cash
payment. The shares purchased upon exercise of an option hereunder shall be
deemed to be transferred to the participant on the Exercise Date. During a
participant's lifetime, a participant's option to purchase shares hereunder is
exercisable only by him or her.
3
<PAGE>
9. Delivery. Upon the written request of a participant, certificates
--------
representing the shares purchased upon exercise of an option will be issued as
promptly as practicable after the Exercise Date of each Offering Period to
participants who wish to hold their shares in certificate form. Any cash
remaining in a participant's account under the Plan after a purchase by him or
her of shares at the termination of each Offering Period shall be carried
forward to the next Exercise Date unless the participant requests a cash
payment.
10. Withdrawal; Termination of Employment.
-------------------------------------
(a) A participant may withdraw all but not less than all the Contributions
credited to his or her account under the Plan at any time prior to the Exercise
Date of the Offering Period by giving written notice to the Company. All of the
participant's Contributions credited to his or her account will be paid to him
or her promptly after receipt of his or her notice of withdrawal and his or her
option for the current period will be automatically terminated, and no further
Contributions for the purchase of shares will be made during the Offering
Period.
(b) Upon termination of the participant's Continuous Status as an Employee
prior to the Exercise Date of the Offering Period for any reason, including
retirement or death, the Contributions credited to his or her account will be
returned to him or her or, in the case of his or her death, to the person or
persons entitled thereto under paragraph 14 hereof, and his or her option will
be automatically terminated.
(c) In the event an Employee fails to remain in Continuous Status as an
Employee for at least 20 hours per week during the Offering Period in which the
Employee is a participant, he or she will be deemed to have elected to withdraw
from the Plan and the Contributions credited to his or her account will be
returned to him or her and his or her option terminated.
(d) A participant's withdrawal from an Offering Period will not have any
effect upon his or her eligibility to participate in a succeeding offering or in
any similar plan which may hereafter be adopted by the Company.
11. Interest. No interest shall accrue on the Contributions of a
--------
participant in the Plan.
12. Stock.
-----
(a) The maximum number of shares of Common Stock which shall be made
available for sale under the Plan shall be 200,000 shares, subject to adjustment
upon changes in capitalization of the Company as provided in paragraph 18. If
the total number of shares which would otherwise be subject to options granted
pursuant to paragraph 7(a) hereof on the Offering Date of an Offering Period
exceeds the number of shares then available under the Plan (after deduction of
all shares for which options have been exercised or are then outstanding), the
Company shall make a pro rata allocation of the shares remaining available for
option grants in as uniform a manner as shall be practicable and as it shall
determine to be equitable. Any amounts remaining in an Employee's account not
applied to the purchase of stock pursuant to this paragraph 12 shall be refunded
on or promptly after the Exercise Date. In such event, the Company shall give
written notice of such reduction of the number of shares subject to the option
to each Employee affected thereby and shall similarly reduce the rate of
Contributions, if necessary.
(b) The participant will have no interest or voting right in shares
covered by his or her option until such option has been exercised.
4
<PAGE>
13. Administration. The Board shall supervise and administer the Plan and
--------------
shall have full power to adopt, amend and rescind any rules deemed desirable and
appropriate for the administration of the Plan and not inconsistent with the
Plan, to construe and interpret the Plan, and to make all other determinations
necessary or advisable for the administration of the Plan.
14. Designation of Beneficiary.
--------------------------
(a) A participant may file a written designation of a beneficiary who is
to receive any shares and cash, if any, from the participant's account under the
Plan in the event of such participant's death subsequent to the end of the
Offering Period but prior to delivery to him or her of such shares and cash. In
addition, a participant may file a written designation of a beneficiary who is
to receive any cash from the participant's account under the Plan in the event
of such participant's death prior to the Exercise Date of the Offering Period.
If a participant is married and the designated beneficiary is not the spouse,
spousal consent shall be required for such designation to be effective.
(b) Such designation of beneficiary may be changed by the participant (and
his or her spouse, if any) at any time by written notice. In the event of the
death of a participant and in the absence of a beneficiary validly designated
under the Plan who is living at the time of such participant's death, the
Company shall deliver such shares and/or cash to the executor or administrator
of the estate of the participant, or if no such executor or administrator has
been appointed (to the knowledge of the Company), the Company, in its
discretion, may deliver such shares and/or cash to the spouse or to any one or
more dependents or relatives of the participant, or if no spouse, dependent or
relative is known to the Company, then to such other person as the Company may
designate.
15. Transferability. Neither Contributions credited to a participant's
---------------
account nor any rights with regard to the exercise of an option or to receive
shares under the Plan may be assigned, transferred, pledged or otherwise
disposed of in any way (other than by will, the laws of descent and distribution
or as provided in paragraph 14 hereof) by the participant. Any such attempt at
assignment, transfer, pledge or other disposition shall be without effect,
except that the Company may treat such act as an election to withdraw funds in
accordance with paragraph 10 hereof.
16. Use of Funds. All Contributions received or held by the Company under
------------
the Plan may be used by the Company for any corporate purpose, and the Company
shall not be obligated to segregate such Contributions.
17. Reports. Individual accounts will be maintained for each participant
-------
in the Plan. Statements of account will be given to participating Employees
promptly following the Exercise Date, which statements will set forth the
amounts of Contributions, the per share purchase price, the number of shares
purchased and the remaining cash balance, if any.
18. Adjustments Upon Changes in Capitalization. Subject to any required
------------------------------------------
action by the stockholders of the Company, the number of shares of Common Stock
covered by unexercised options under the Plan and the number of shares of Common
Stock which have been authorized for issuance under the Plan but are not yet
subject to options (collectively, the "Reserves"), as well as the price per
share of Common Stock covered by each unexercised option under the Plan, shall
be proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the number of shares of Common Stock effected without
receipt of consideration by the Company; provided, however, that conversion of
any convertible securities of the Company shall not be deemed to have been
"effected without receipt of consideration." Such adjustment shall be made by
the Board, whose determination in that respect shall be final, binding and
conclusive.
5
<PAGE>
Except as expressly provided herein, no issue by the Company of shares of stock
of any class, or securities convertible into shares of stock of any class, shall
affect, and no adjustment by reason thereof shall be made with respect to, the
number or price of shares of Common Stock subject to an option.
In the event of the proposed dissolution or liquidation of the Company, an
Offering Period then in progress will terminate immediately prior to the
consummation of such proposed action, unless otherwise provided by the Board.
In the event of a proposed sale of all or substantially all of the assets of the
Company, or the merger of the Company with or into another corporation, each
option outstanding under the Plan shall be assumed or an equivalent option shall
be substituted by such successor corporation or a parent or subsidiary of such
successor corporation, unless the Board determines, in the exercise of its sole
discretion and in lieu of such assumption or substitution, to shorten the
Offering Period then in progress by setting a new Exercise Date (the "New
Exercise Date"). If the Board shortens the Offering Period then in progress in
lieu of assumption or substitution in the event of a merger or sale of assets,
the Board shall notify each participant in writing, at least ten days prior to
the New Exercise Date, that the Exercise Date for his or her option has been
changed to the New Exercise Date and that his or her option will be exercised
automatically on the New Exercise Date, unless prior to such date he or she has
withdrawn from the Offering Period as provided in paragraph 10 hereof. For
purposes of this paragraph, an option granted under the Plan shall be deemed to
be assumed if, following the sale of assets or merger, the option confers the
right to purchase, for each share of Common Stock subject to the option
immediately prior to the sale of assets or merger, the consideration (whether
stock, cash or other securities or property) received in the sale of assets or
merger by holders of Common Stock for each share of Common Stock held on the
effective date of the transaction (and if such 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 such
consideration received in the sale of assets or merger was not solely common
stock of the successor corporation or its parent (as defined in Section 424(e)
of the Code), the Board may, with the consent of the successor corporation,
provide for the consideration to be received upon exercise of the option to be
solely common stock of the successor corporation or its parent equal in fair
market value to the per share consideration received by holders of Common Stock
in the sale of assets or merger.
The Board may, if it so determines in the exercise of its sole discretion,
also make provision for adjusting the Reserves, as well as the price per share
of Common Stock covered by each outstanding option, in the event that the
Company effects one or more reorganizations, recapitalizations, rights offerings
or other increases or reductions of shares of its outstanding Common Stock, and
in the event of the Company being consolidated with or merged into any other
corporation.
19. Amendment or Termination. The Board may at any time terminate or
------------------------
amend the Plan. Except as provided in paragraph 18 hereof, no such termination
may affect options previously granted, nor may an amendment make any change in
any option theretofore granted which adversely affects the rights of any
participant. In addition, to the extent necessary to comply with Section 423 of
the Code (or any successor rule or provision or any applicable law or
regulation), the Company shall obtain stockholder approval in such a manner and
to such a degree as so required.
20. Notices. All notices or other communications by a participant to the
-------
Company under or in connection with the Plan shall be deemed to have been duly
given when received in the form specified by the Company at the location, or by
the person, designated by the Company for the receipt thereof.
21. Conditions Upon Issuance of Shares. Shares shall not be issued with
----------------------------------
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, the rules and regulations promulgated thereunder, and the requirements
of any stock exchange upon which the shares
6
<PAGE>
may then be listed, and shall be further subject to the approval of counsel for
the Company with respect to such compliance.
As a condition to the exercise of an option, the Company may require the
person exercising such option to represent and warrant at the time of any such
exercise that the shares are being purchased only for investment and without any
present intention to sell or distribute such shares if, in the opinion of
counsel for the Company, such a representation is required by any of the
aforementioned applicable provisions of law.
22. Right to Terminate Employment. Nothing in the Plan or in any
-----------------------------
agreement entered into pursuant to the Plan shall confer upon any Employee or
other optionee the right to continue in the employment of the Company or any
Subsidiary, or affect any right which the Company or any Subsidiary may have to
terminate the employment of such Employee or other optionee.
23. Rights as a Stockholder. Neither the granting of an option nor a
-----------------------
deduction from payroll shall constitute an Employee the owner of shares covered
by an option. No optionee shall have any right as a stockholder unless and
until an option has been exercised, and the shares underlying the option have
been registered in the Company's share register.
24. Term of Plan. The Plan became effective upon its adoption by the
------------
Board of Directors on May 9, 2000 and shall continue in effect for a term of ten
(10) years unless sooner terminated under paragraph 19 hereof.
25. Applicable Law. This Plan shall be governed in accordance with the
--------------
laws of the State of Delaware, applied without giving effect to any conflict-of-
law principles.
7
