Amendment to CNS, Inc. 1989 Employee Stock Purchase Plan (October 8, 2006)
This amendment to the CNS, Inc. 1989 Employee Stock Purchase Plan (ESPP) sets an early termination date for the 2006-2 Phase of the plan, ending it on December 31, 2006 or immediately before the merger's effective time, whichever comes first. No new employees can join this phase before it ends. Any outstanding options at the time of termination will be cancelled, and participants will receive a cash payment based on the number of shares they could have purchased and the difference between the merger price and the exercise price.
Exhibit 10.7
Amendment of October 8, 2006 to CNS, Inc. 1989 Employee Stock Purchase Plan.
The 2006-2 Phase of the ESPP shall terminate the earlier of December 31, 2006 or immediately prior to the Effective Time of the Merger, no new employee shall become eligible for the 2006-02 Phase of the ESPP prior to such termination date, and options under the 2006-2 Phase of the ESPP outstanding as of the Effective Time be cancelled in exchange for a cash payment equal to the product of: (i) the whole number of shares (rounded down to the nearest whole number) that the participant would have been entitled to purchase under the ESPP as of the date of termination of the 2006-2 Phase; and (ii) the excess, if any, of the Merger Consideration over the exercise price of such shares as determined under Section 8(a)(ii) of the ESPP.
