EXHIBIT 10.1

AMENDMENT NO.  4 TO
AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

This Amendment No.  4 to Amended and Restated Loan and Security Agreement (this
“Amendment”) is effective as of October 1, 2006, is by and among LASALLE BANK
NATIONAL ASSOCIATION, for itself as a lender, and as Agent (“Agent”) for the
lenders (“Lenders”) from time to time party to the Amended and Restated Loan
Agreement (as defined below) and APAC CUSTOMER SERVICES, INC. (“Borrower”).

Preliminary Statements

Agent and Borrower are party to that certain Amended and Restated Loan and
Security Agreement dated as of October 31, 2005 (as amended, restated,
supplemented or otherwise modified from time to time, the (“Amended and Restated
Loan Agreement”). Capitalized terms used but not defined in this Amendment shall
have the meanings ascribed to such terms in the Amended and Restated Loan
Agreement.

Borrower has requested, among other things, that Agent amend the Amended and
Restated Loan Agreement to (i) provide for changes to the definitions of Capital
Expenditures, EBITDA and Special Litigation Reserve pursuant to Section 1,
(ii) amend the Tangible Net Worth covenant pursuant to Section 14(a), the
Maximum Cash Restructuring Charge covenant pursuant to Section 14(e), and the
Fixed Charge Coverage covenant pursuant to Section 14(f) and (iii) eliminate the
Interest Coverage covenant pursuant to Section 14(b), the Minimum Free Cash Flow
covenant pursuant to Section 14(c) and the Excess Availability covenant pursuant
to Section 14(d), all as set forth herein and Agent is willing to do so on the
terms and subject to the conditions set forth herein.

NOW, THEREFORE, in consideration of the foregoing recitals, the mutual covenants
and agreements set forth herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:

1. Amendment to Amended and Restated Loan Agreement. In reliance on the
representations and warranties set forth in Section 2 below and subject to the
satisfaction of the conditions set forth in Section 3 below, the Amended and
Restated Loan Agreement is hereby amended as follows:

(a) The definitions of “Capital Expenditures”, “EBITDA” and “Special Litigation
Reserve” in Section 1 of the Amended and Restated Loan Agreement are hereby
amended and restated in their entirety, as follows:

“Capital Expenditures” shall mean with respect to any period, the aggregate of
all expenditures (whether paid in cash or accrued as liabilities and including
expenditures for capitalized lease obligations) by Borrower and its Subsidiaries
during such period that are required by generally accepted accounting
principles, consistently applied, to be included in or reflected by the
property, plant and equipment or similar fixed asset accounts (or intangible
accounts subject to amortization) on the balance sheet of Borrower and its
Subsidiaries less the amount of net cash proceeds received from the sale of such
property, plant and equipment or similar fixed asset that have been applied
against the Revolving Loans of Borrower during such period.

"EBITDA” shall mean, with respect to any period, Borrower’s and its
Subsidiaries’ net income for such period, plus the sum (without duplication) of
all amounts deducted in arriving at such net income amount in respect of
(i) interest expense for such period, (ii) federal, state and local income taxes
for such period, (iii) all amounts properly charged for depreciation of fixed
assets and amortization of intangible assets (including, without limitation,
goodwill, deferred expenses and organization costs) for such period, (iv) 
non-cash restructuring charges and non-cash asset impairment charges incurred
during the period from July 1, 2005 through December 31, 2006 and not to exceed
$5,000,000 in connection with the Restructuring, (v) cash restructuring charges
incurred during such period in connection with the Restructuring Plan, not to
exceed $9,000,000 from July 1, 2005 through June 30, 2006, (vi) the write down
of goodwill in the quarter ending September 30, 2005 in an amount not to exceed
$11,000,000; (vii) with respect to periods beginning after June 30, 2006, cash
and non-cash restructuring charges and non-cash asset impairment charges
incurred during the period and not to exceed (A) $2,100,000 for the six (6)
month period from July 1, 2006 through the end of Borrower’s Fiscal Year ending
on or about December 31, 2006 and (B) $2,500,000 in any Fiscal Year thereafter,
and (viii) non-cash charges related to the expensing of options for Borrower’s
common stock, all on a consolidated basis.

"Special Litigation Reserve” shall mean a reserve established by Agent on
June 30, 2006 equal to $1,000,000.00 which was subsequently increased to
$1,600,000.00 as of October 1, 2006, which reserve shall be increased to
$2,800,000 on December 31, 2006 and, which reserve shall be subsequently
increased on the last Business Day of each calendar month thereafter by (i)
$150,000 for each calendar month from January, 2007 through December, 2007, and
(ii) $125,000 for each calendar month from January 2008 through the earlier to
occur of (A) December 2008 and (B) the termination of this Agreement pursuant to
Section 10, provided that such reserve may be adjusted by Agent from time to
time, in its sole discretion, determined in good faith, and may be eliminated if
Borrower and Agent agree.

(b) Section 2(a) of the Amended and Restated Loan Agreement is hereby amended
and restated in its entirety, as follows:

2. LOANS.

(a) Revolving Loans.

Immediately prior to the effectiveness of this Agreement, as of the date
thereof, the outstanding principal balance of the Original Revolving Loans was
$9,407,249.59 (the “Outstanding Original Revolving Loan Balance”). On the date
thereof, the Outstanding Original Revolving Loan Balance remained an outstanding
Liability except to the extent that such Outstanding Original Revolving Loan
Balance was repaid on the date thereof. Subject to the terms and conditions of
this Agreement and the Other Agreements to which an Obligor is a party, during
the Original Term and any Renewal Term, so long as no Event of Default has
occurred and is continuing, each Lender, severally and not jointly, agrees to
make its Pro Rata Share of revolving loans and advances (the “Revolving Loans”)
requested by Borrower up to such Lender’s Revolving Loan Commitment so long as
after giving effect to such Revolving Loans, the sum of the aggregate unpaid
principal balance of the Revolving Loans and the Letter of Credit Obligations
does not exceed the sum of the following sublimits (the "Revolving Loan Limit”):

(i) eighty-five percent (85%) of the face amount (less maximum discounts,
credits and allowances which may be taken by or granted to Account Debtors in
connection therewith in the ordinary course of Borrower’s business) of
Borrower’s Billed Eligible Accounts; plus

(ii) (A) eighty-five percent (85%) of the face amount (less maximum discounts,
credits and allowances which may be taken by or granted to Account Debtors in
connection therewith in the ordinary course of Borrower’s business) of
Borrower’s Unbilled Eligible Accounts or (B) Seventeen Million and No/100
Dollars ($17,000,000), whichever is less; minus

(iii) such reserves as Agent elects, in its sole discretion, determined in good
faith, to establish from time to time (which amount shall include the Special
Litigation Reserve and an amount reflecting unpaid payroll including payroll
taxes which amount shall initially be $7,000,000);

provided, that the Revolving Loan Limit shall in no event exceed, as of any
date, Twenty-Seven Million Five Hundred Thousand and No/100 Dollars
($27,500,000) (such amount from time to time in effect, the “Maximum Revolving
Loan Limit”); provided, further, that the Revolving Loan Limit shall be
determined by reference to the most current borrowing base certificate delivered
pursuant to Section 9(a) and such determination shall remain in effect until
delivery of the next borrowing base certificate unless the Revolving Loan Limit
is otherwise adjusted by Agent in its sole credit judgment determined in good
faith as a result of Billed Eligible Accounts or Unbilled Eligible Accounts
becoming ineligible prior to the delivery of the next borrowing base certificate
or the establishment by Agent in its sole discretion, determined in good faith,
of any reserves. Agent shall provide prompt notice to Borrower when (i) any
adjustment of the Revolving Loan Limit prior to the delivery of a borrowing base
certificate pursuant to Section 9(a) is made and (ii) establishing any reserves.

The aggregate unpaid principal balance of the Revolving Loans shall not at any
time exceed the lesser of the (i) Revolving Loan Limit minus the Letter of
Credit Obligations and (ii) the Maximum Revolving Loan Limit minus the Letter of
Credit Obligations. If at any time the outstanding Revolving Loans exceeds
either the Revolving Loan Limit or the Maximum Revolving Loan Limit, in each
case minus the Letter of Credit Obligations, or any portion of the Revolving
Loans and Letter of Credit Obligations exceeds any applicable sublimit within
the Revolving Loan Limit, Borrower shall immediately, and without the necessity
of demand by Agent, pay to Agent such amount as may be necessary to eliminate
such excess and Agent shall apply such payment to the outstanding Prime Rate
Loans until such Revolving Loans are paid in full and then to the outstanding
LIBOR Rate Loans.

Neither Agent nor any Lender shall be responsible for any failure by any other
Lender to perform its obligations to make Revolving Loans hereunder, and the
failure of any Lender to make its Pro Rata Share of any Revolving Loan hereunder
shall not relieve any other Lender of its obligation, if any, to make its Pro
Rata Share of any Revolving Loans hereunder.

If Borrower makes a request for a Revolving Loan as provided herein Agent, at
its option and in its sole discretion, shall do either of the following:

(i) advance the amount of the proposed Revolving Loan to Borrower
disproportionately (a “Disproportionate Advance”) out of Agent’s own funds on
behalf of Lenders, which advance shall be on the same day as Borrower’s request
therefor with respect to Prime Rate Loans if Borrower notifies Agent of such
request by 1:00 P.M. (Chicago time) on such day, and request settlement in
accordance with Section 18 hereof such that upon such settlement each Lender’s
share of the outstanding Revolving Loans (including, without limitation, the
amount of any Disproportionate Advance) equals its Pro Rata Share; or

(ii) Notify each Lender by telecopy, electronic mail or other similar form of
teletransmission of the proposed advance on the same day Agent is notified or
deemed notified by Borrower of Borrower’s request for an advance pursuant to
this subsection 2(a). Each Lender shall remit, to the demand deposit account
designated by Borrower (i) with respect to Prime Rate Loans, at or prior to 3:00
P.M., Chicago time, on the date of notification, if such notification is made
before 1:00 P.M., Chicago time, or 10:00 A.M., Chicago time, on the Business Day
immediately succeeding the date of such notification, if such notification is
made after 1:00 P.M., Chicago time, and (ii) with respect to LIBOR Rate Loans,
at or prior to 10:30 A.M., Chicago time, on the date such LIBOR Rate Loans are
to be advanced, immediately available funds in an amount equal to such Lender’s
Pro Rata Share of such proposed advance.

If and to the extent that a Lender does not settle with Agent as required under
this Agreement (a "Defaulting Lender”) Borrower and Defaulting Lender severally
agree to repay to Agent forthwith on demand such amount required to be paid by
such Defaulting Lender to Agent, together with interest thereon, for each day
from the date such amount is made available to Borrower until the date such
amount is repaid to Agent (x) in the case of a Defaulting Lender at the rate
published by the Federal Reserve Bank of New York on the next succeeding
Business Day as the “Federal Funds Rate” or if no such rate is published for any
Business Day, at the average rate quoted for such day for such transactions from
three (3) federal funds brokers of recognized standing selected by Agent, and
(y) in the case of Borrower, at the interest rate applicable at such time for
such Revolving Loans; provided, that Borrower’s obligation to repay such advance
to Agent shall not relieve such Defaulting Lender of its liability to Agent for
failure to settle as provided in this Agreement.

Borrower hereby authorizes Agent, in its sole discretion determined in good
faith, to charge any of Borrower’s accounts or advance Revolving Loans to make
any payments of principal, interest, fees, reasonable and documented costs or
reasonable and documented expenses required to be made under this Agreement or
the Other Agreements.

A request for a Revolving Loan shall be made or shall be deemed to be made, each
in the following manner: Borrower shall give Agent same day notice, no later
than 1:00 P.M. (Chicago time) on such day, of its request for a Revolving Loan
as a Prime Rate Loan, and at least three (3) Business Days prior notice of its
request for a Revolving Loan as a LIBOR Rate Loan, in which notice Borrower
shall specify the amount of the proposed borrowing, the applicable Interest
Period for LIBOR Rate Loans, and the proposed borrowing date; provided, however,
that no such request may be made at a time when there exists an Event of Default
or an event which, with the passage of time or giving of notice, will become an
Event of Default. In the event that Borrower maintains a controlled disbursement
account at LaSalle, each check presented for payment against such controlled
disbursement account and any other charge or request for payment against such
controlled disbursement account shall constitute, to the extent there are
insufficient funds in such controlled disbursement account to make such payment,
a request for a Revolving Loan as a Prime Rate Loan in an amount equal to any
such insufficient funds. As an accommodation to Borrower, Agent may permit
telephone requests for Revolving Loans and electronic transmittal of
instructions, authorizations, agreements or reports to Agent by Borrower. Unless
Borrower specifically directs Agent in writing not to accept or act upon
telephonic or electronic communications from Borrower, Agent shall have no
liability to Borrower for any loss or damage suffered by Borrower as a result of
Agent’s honoring of any requests, execution of any instructions, authorizations
or agreements or reliance on any reports communicated to it telephonically or
electronically and purporting to have been sent to Agent by Borrower and Agent
shall have no duty to verify the origin of any such communication or the
authority of the Person sending it, except, in each case, to the extent Agent is
grossly negligent or commits willful misconduct.

Borrower hereby irrevocably authorizes Agent to disburse the proceeds of each
Revolving Loan requested by Borrower, or deemed to be requested by Borrower, as
follows: the proceeds of each Revolving Loan requested under subsection 2(a)
shall be disbursed by Agent in lawful money of the United States of America in
immediately available funds, in the case of the initial borrowing, in accordance
with the terms of the written disbursement letter from Borrower, and in the case
of each subsequent borrowing, by wire transfer, book transfer or Automated
Clearing House (ACH) transfer to such bank account as may be agreed upon by
Borrower and Agent from time to time, or elsewhere if pursuant to a written
direction from Borrower.         .

(c) Section 14 of the Amended and Restated Loan Agreement is hereby amended and
restated in its entirety, as follows:

14. Until payment and satisfaction in full of all Liabilities and the
termination of this Agreement, unless Borrower obtains Requisite Lenders’ prior
written consent waiving or modifying any of Borrower’s financial covenants
hereunder in any specific instance, Borrower shall maintain and keep in full
force and effect each of the financial covenants set forth below:

(a) Tangible Net Worth.

Borrower’s Tangible Net Worth shall not as of the last day of each fiscal
quarter of Borrower be less than the Minimum Tangible Net Worth; “Minimum
Tangible Net Worth” being defined for purposes of this subsection as (i)
$6,500,000 at all times from the date hereof through December 31, 2005, (ii)
$6,000,000 at all times from January 1, 2006 through June 30, 2006,
(iii) $6,750,000 at all times from July 1, 2006 through September 30, 2006,
(iv) $7,750,000 at all times from October 1, 2006 through December 31, 2006, and
(v) thereafter, for each other fiscal quarter of Borrower, the Minimum Tangible
Net Worth during the immediately preceding fiscal quarter of Borrower plus fifty
percent (50%) of Borrower’s positive net income for such fiscal quarter as
reflected on Borrower’s financial statements delivered pursuant to subsection
9(c) for such fiscal quarter; and “Tangible Net Worth” being defined for
purposes of this subsection as of any particular date, the difference between
(a) total shareholders equity, minus (b) the value of Borrower’s unamortized
debt discount and expense, prepaid expenses, deposits, unamortized deferred
charges (including deferred income tax assets with a maximum limit of up to
Twelve Million and No/100 Dollars ($12,000,000.00)), goodwill, organization
costs, noncompetition agreements, patents, copyrights, trademarks and other
intangible items, all as determined in accordance with generally accepted
accounting principles applied on a basis consistent with the financial statement
dated August 27, 2006 except as set forth herein.

(b) Maximum Cash Restructuring Charge.

Borrower shall not incur cash restructuring charges in excess of (i) $5,000,000
in the aggregate in connection with the Restructuring Plan during the period
between January 1, 2006 and December 31, 2006, (ii) $2,500,000 in the aggregate
during the period between January 1, 2007 and December 31, 2007, and (iii)
$2,500,000 in the aggregate during the period between January 1, 2008 and
December 31, 2008.

(c) Fixed Charge Coverage.

Borrower shall not permit the ratio of its EBITDA to Fixed Charges for each
period set forth below to be less than the amount set forth for such period:

      Ratio   Date
.40 : 1.00
  For the trailing 9 months ending September 2006
 
   
 
   
.55 : 1.00
  For the trailing 12 months ending December 2006
 
   
 
   
.65 : 1.00
  For the trailing 12 months ending March 2007
 
   
 
   
.75 : 1.00
  For the trailing 12 months ending June 2007
 
   
 
   
.85 : 1.00
  For the trailing 12 months ending September 2007
 
   
 
   
1.00 : 1.00
  For the trailing 12 months ending December 2007 and for
the trailing 12 months periods ending on the last day of
each fiscal quarter thereafter
 
   

2. Representations and Warranties of Borrower. Borrower represents and warrants
that, as of the date hereof:

(a) The execution, delivery and performance by Borrower of this Amendment, are
within the organizational power of Borrower, have been duly authorized by all
necessary action, have received all necessary governmental approval (if any
shall be required), other than approvals which could not reasonably be expected
to have a Material Adverse Effect on Borrower, and do not and will not
contravene or conflict with any provision of law applicable to Borrower, the
articles of incorporation, by-laws or any other organizational document of
Borrower, any order, judgment or decree of any court or governmental agency, or
any agreement, instrument or document binding upon Borrower or any property of
Borrower, in each case, which contravention or conflict could reasonably be
expected to have a Material Adverse Effect on Borrower;

(b) Each of the Amended and Restated Loan Agreement, as amended by this
Amendment and the Other Agreements to which Borrower is a party are the legal,
valid and binding obligations of Borrower, enforceable against Borrower in
accordance with their respective terms, except as limited by applicable
bankruptcy, insolvency or other laws related to enforcement of creditor’s rights
generally and general principles of equity related to enforcement;

(c) After giving effect to the amendments set forth herein, no Event of Default
or event or condition which upon notice, lapse of time or both would constitute
an Event of Default has occurred and is continuing; and

(d) After giving effect to the amendments set forth herein, the representations
and warranties of the Borrower contained in the Amended and Restated Loan
Agreement and the Other Agreements are true and accurate as of the date hereof
with the same force and effect as if such had been made on and as of the date
hereof, except for those specific to a past date (which shall be true and
correct as of such past date).

3. Conditions Precedent. The effectiveness of this Amendment is subject to the
satisfaction of the following condition precedent:

(a) Agent shall have received this Amendment executed by Borrower, Agent and
LaSalle Bank National Association;

(b) Agent shall have received the Consent and Reaffirmation executed by each
Obligor (other than the Borrower);

(c) Borrower shall pay to Agent a one-time amendment fee of Twenty-Five Thousand
and No/100 Dollars ($25,000.00) which fee shall be fully earned and payable on
the date this Amendment is executed by Agent;

(d) Borrower shall pay to Agent a one time line increase fee of Twelve Thousand
Five Hundred and No/100 Dollars ($12,500.00), which fee shall be fully earned by
Lender and payable on the date this Amendment is executed by Agent;

(e) Borrower shall have paid a legal fee of One Thousand and No/100 ($1,000.00)
for Agent’s internal legal costs to prepare this Amendment; and

(f) All proceedings taken in connection with this Amendment and all documents,
instruments and other legal matters incident thereto shall be satisfactory to
Agent and its legal counsel such acceptance to be evidenced by Agent’s execution
hereof.

4. No Novation. This Amendment is not intended to nor shall be construed to
create a novation or accord and satisfaction with respect to any of the
Liabilities.

5. Severability. Any provision of this Amendment that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.

6. Ratification. Except as expressly waived and modified hereby, the Amended and
Restated Loan Agreement and the Other Agreements each hereby are ratified and
confirmed by the parties hereto and remain in full force and effect in
accordance with the respective terms thereof. Agent and Lenders willingness to
provide the waivers herein and agree to the amendments herein shall not be
deemed to indicate or require Agent’s or Lenders’ willingness to agree to any
deviation from the terms of the Amended and Restated Loan Agreement (as modified
hereby) in the future.

7. Choice of Law. This Amendment shall be governed and controlled by the laws of
the State of Illinois as to interpretation, enforcement, validity, construction,
effect and in all other respects.

[Remainder of page intentionally left blank, signatures to follow]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed under seal and delivered by their respective duly authorized officers
on the date first written above.

          LASALLE BANK NATIONAL ASSOCIATION, as Agent     and a Lender     By/s/
Andrew J. Heinz     Its First Vice President     APAC CUSTOMER SERVICES, INC.,  
  as Borrower     By /s/George H. Hepburn III     Its SVP & CFO
Dated: October 25, 2006
 

 
 

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CONSENT AND REAFFIRMATION

The undersigned (“Guarantors”), hereby (i) acknowledge receipt of a copy of the
foregoing Amendment No. 4 to Amended and Restated Loan and Security Agreement
(the “Amendment”); (ii) consent to Borrower’s execution and delivery of the
Amendment; and (iii) reaffirm that each of the Other Agreements that it is a
party to continue to remain in full force and effect. Although Guarantors have
been informed of the matters set forth herein and have acknowledged same,
Guarantors understand that Agent and Lenders have no obligation to inform
Guarantors of such matters in the future or to seek Guarantors’ acknowledgment
to future amendments, waivers or consents, and nothing herein shall create such
a duty.

IN WITNESS WHEREOF, Guarantors have executed this Consent and Reaffirmation on
and as of the date of the Amendment.

  APAC CUSTOMER SERVICES, L.L.C. APAC CUSTOMER SERVICES OF ILLINOIS, INC. APAC
CUSTOMER SERVICES GENERAL PARTNER, INC. ITI HOLDINGS, LLC APAC CUSTOMER SERVICES
OF IOWA, L.L.C. APAC CUSTOMER SERVICES OF TEXAS, L.P. by its general partner,
APAC Customer Services General Partner, Inc. Each By Robert J. Keller Its
President & CEO
 

Amendment No. 4 To Amended And Restated Loan And Security Agreement_v
FINAL

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