Exhibit 10.04

[As amended August 14, 2007,

effective as of May 27, 2005]

CSG SYSTEMS INTERNATIONAL, INC.

2005 STOCK INCENTIVE PLAN

1. Purpose. The purpose of the CSG Systems International, Inc. 2005 Stock
Incentive Plan (the “Plan”) is to foster and promote the long-term financial
success of the Company and its Subsidiaries and thereby increase stockholder
value by providing incentives to those officers and other key employees of the
Company and its Subsidiaries who are likely to be responsible for achieving such
financial success and by attracting and compensating knowledgeable and
experienced non-employee directors of the Company whose services on the Board
and its committees can assist such officers and other key employees in the
achievement of such financial success.

2. Certain Definitions.

“Board” means the Board of Directors of the Company.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, or
any successor thereto. References to a particular section of the Code shall
include any regulations issued under such section.

“Committee” shall have the meaning provided in Section 3 of the Plan.

“Common Stock” means the Common Stock, $0.01 par value per share, of the
Company.

“Company” means CSG Systems International, Inc., a Delaware corporation.

“Disability” means (i) with respect to the exercise of an Incentive Stock Option
after termination of employment, a disability within the meaning of
Section 22(e)(3) of the Code and (ii) for all other purposes, a mental or
physical condition which, in the opinion of the Committee, renders a grantee
unable or incompetent to carry out the job responsibilities which such grantee
held or the tasks to which such grantee was assigned (or, in the case of a
non-employee director of the Company, the services in such capacity which such
non-employee director is expected to perform) at the time the disability was
incurred and which is expected to be permanent or for an indefinite duration
exceeding one year.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time.

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“Fair Market Value” means, as determined by the Committee, the last sale price
of the Common Stock as quoted on the Nasdaq National Market System on the
trading day for which the determination is being made, or, in the event that no
such sale takes place on such day, the average of the reported closing bid and
asked prices on such day, or, if the Common Stock of the Company is listed on a
national securities exchange, the last reported sale price on the principal
national securities exchange on which the Common Stock is listed or admitted to
trading on the trading day for which the determination is being made, or, if no
such reported sale takes place on such day, the average of the closing bid and
asked prices on such day on the principal national securities exchange on which
the Common Stock is listed or admitted to trading, or, if the Common Stock is
not quoted on such National Market System nor listed or admitted to trading on a
national securities exchange, the average of the closing bid and asked prices in
the over-the-counter market on the day for which the determination is being made
as reported through Nasdaq, or, if bid and asked prices for the Common Stock on
such day are not reported through Nasdaq, the average of the bid and asked
prices for such day as furnished by any New York Stock Exchange member firm
regularly making a market in the Common Stock selected for such purpose by the
Committee, or, if none of the foregoing is applicable, then the fair market
value of the Common Stock as determined in good faith by the Committee in its
sole discretion.

“Incentive Stock Option” means any stock option intended to qualify as an
“incentive stock option” within the meaning of Section 422 of the Code.

“Non-Qualified Stock Option” means any stock option that is not intended to be
an Incentive Stock Option, including any stock option that provides (as of the
time such option is granted) that it will not be treated as an Incentive Stock
Option.

“Parent Corporation” means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if, at the time of the
granting of the option, each of the corporations other than the Company owns
stock possessing 50% or more of the total combined voting power of all classes
of stock in one of the other corporations in such chain.

“Performance Unit Award” means an award granted pursuant to Section 8.

“Plan Year” means the twelve-month period beginning on January 1 and ending on
December 31; provided, that the first Plan Year shall be a short Plan Year
beginning on the date on which the Plan is approved by the stockholders of the
Company and ending on December 31 of the calendar year during which such
stockholder approval occurs.

“Restricted Stock Award” means an award of Common Stock granted pursuant to
Section 9.

“Rule 16b-3” means Rule 16b-3 under the Exchange Act, as in effect from time to
time.

“Stock Appreciation Right” means an award granted pursuant to Section 7.

“Stock Bonus Award” means an award of Common Stock granted pursuant to
Section 10.

 

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“Stock Option” means any option to purchase Common Stock granted pursuant to
Section 6.

“Subsidiary” means (i) as it relates to Incentive Stock Options, any corporation
(other than the Company) in an unbroken chain of corporations beginning with the
Company if, at the time of the granting of the option, each of the corporations
(other than the last corporation in the unbroken chain) owns stock possessing
50% or more of the total combined voting power of all classes of stock in one of
the other corporations in such chain and (ii) for all other purposes, a
corporation or other entity, domestic or foreign, of which not less than 50% of
the voting shares or other voting interests are held by the Company or by a
Subsidiary, whether or not such corporation or other entity now exists or
hereafter is organized or acquired by the Company or by a Subsidiary. The plural
form of such word is “Subsidiaries”.

3. Administration. The Plan shall be administered by a committee composed solely
of two or more members of the Board (the “Committee”) selected by the Board,
each of whom shall qualify as a “Non-Employee Director” within the meaning of
Rule 16b-3 and as an “outside director” within the meaning of Section 162(m) of
the Code.

The Committee shall have authority to grant to eligible employees of the Company
and its Subsidiaries and to non-employee directors of the Company, pursuant to
the terms of the Plan, (a) Stock Options, (b) Stock Appreciation Rights,
(c) Restricted Stock Awards, (d) Performance Unit Awards, (e) Stock Bonus
Awards, or (f) any combination of the foregoing; provided, that the Committee
may not grant Incentive Stock Options, Performance Unit Awards or Stock Bonus
Awards to non-employee directors of the Company.

Subject to the applicable provisions of the Plan, the Committee shall have
authority to interpret the provisions of the Plan and to decide all questions of
fact arising in the application of such provisions; to select the officers and
other key employees of the Company and its Subsidiaries and the non-employee
directors of the Company to whom awards or options shall be granted under the
Plan; to determine whether and to what extent awards or options shall be granted
under the Plan; to determine the types of awards and options to be granted under
the Plan and the amount, size, terms and conditions of each such award or
option; to determine the time when awards or options shall be granted under the
Plan; to determine whether, to what extent and under what circumstances the
payment of Common Stock and other amounts payable with respect to an award
granted under the Plan shall be deferred either automatically or at the election
of the grantee; to determine the Fair Market Value of the Common Stock from time
to time; to authorize persons to execute on behalf of the Company any agreement
required to be entered into under the Plan; to adopt, alter and repeal such
administrative rules, guidelines and practices governing the Plan as the
Committee from time to time shall deem advisable; and to make all other
determinations and take all other actions necessary or advisable for the
administration of the Plan.

Unless otherwise expressly provided in the Plan or by applicable law, all
decisions and determinations made by the Committee in the administration and
interpretation of the Plan or with respect to any ambiguous or disputed terms of
any award or option shall be made in the sole discretion of the Committee and
shall be final and binding on all persons, including but not limited to the
Company

 

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and its Subsidiaries, the officers and other key employees of the Company and
its Subsidiaries and the non-employee directors of the Company to whom awards
and options are granted under the Plan, the heirs and legal representatives of
such officers, key employees and non-employee directors, and the personal
representatives and beneficiaries of the estates of such officers, key employees
and non-employee directors.

The Committee may, in its sole discretion, vary the provisions of the Plan
(except the provisions of Sections 4, 13, 14, 21 (other than to require a
grantee’s consent to an amendment of an outstanding option or award), and 24 of
the Plan) in order to conform such provisions to the legal requirements of each
non-U.S. jurisdiction where a Subsidiary is located or to accomplish the purpose
of the Plan with respect to persons employed in such non-U.S. jurisdictions who
are eligible to receive awards and options under the Plan. The Committee may,
where it deems appropriate in its sole discretion, establish one or more
sub-plans for such purposes; and the Committee may, in its sole discretion,
establish administrative rules and procedures to facilitate the operation of the
Plan or such sub-plans in such non-U.S. jurisdictions. For purposes of clarity,
the terms of the Plan which will vary in a particular non-U.S. jurisdiction
shall be reflected in a written addendum to the Plan for such non-U.S.
jurisdiction.

The Committee may delegate to any officer or officers of the Company any of the
Committee’s duties, powers and authorities under the Plan upon such conditions
and with such limitations as the Committee may determine; provided, that only
the Committee may select for awards or options under the Plan, and make grants
of awards or options under the Plan to, officers and other key employees of the
Company or any Subsidiary who are subject to Section 16 of the Exchange Act at
the time of such selection or the making of such a grant and non-employee
directors of the Company.

4. Common Stock Subject to the Plan. Subject to adjustment pursuant to
Section 19, the maximum number of shares of Common Stock which may be issued
under the Plan is 12,400,000; and the Company shall reserve and keep available
for issuance under the Plan such maximum number of shares, subject to adjustment
pursuant to Section 19. Such shares may consist in whole or in part of
authorized and unissued shares or treasury shares or any combination thereof.
Shares awarded under the Plan as a Stock Bonus Award, Restricted Stock Award or
Performance Unit Award shall be counted against the maximum number of shares of
Common Stock which may be issued under the Plan as two shares for every one
share granted as or issued in payment of such Award or by reference to which
such Award is valued. Subject to adjustment pursuant to Section 19, the
aggregate number of shares of Common Stock subject to or issuable in payment of
(i) Stock Options, (ii) Stock Appreciation Rights, (iii) Stock Bonus Awards,
(iv) Restricted Stock Awards, or (v) Performance Unit Awards granted under the
Plan in any Plan Year to any individual may not exceed 480,000, with shares
awarded under the Plan to such individual as a Stock Bonus Award, Restricted
Stock Award or Performance Unit Award being counted against such aggregate
number as two shares for every one share granted as or issued in payment of such
Award or by reference to which such Award is valued. Except as otherwise
provided in the Plan, any shares subject to a Stock Option or a Stock
Appreciation Right which expires for any reason or terminates unexercised as to
such shares shall again be available for the grant of awards or options under
the Plan. Shares of Common Stock granted under the Plan as Restricted Stock
Awards which are reacquired by the Company from the grantee pursuant to the
terms of such grant shall not again be available for the grant of awards or
options

 

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under the Plan, and shares of Common Stock retained by the Company in full or
partial payment of an option exercise price pursuant to Section 6(d)(ii)(B) or
withheld by the Company in satisfaction of any federal, state or local tax
withholding requirement shall not again be available for the grant of awards or
options under the Plan. If a Stock Appreciation Right is exercised by a grantee
and the Company pays the award to the grantee in whole or in part in shares of
Common Stock, then the number of shares reserved for issuance under the Plan
shall be reduced by the number of shares covered by the Stock Appreciation Right
as to which such exercise occurs. If a Stock Appreciation Right is exercised by
a grantee and the Company pays the award to the grantee entirely in cash, then
the shares covered by the Stock Appreciation Right as to which such exercise
occurs shall again be available for the grant of awards or options under the
Plan.

5. Eligibility to Receive Awards and Options. Awards and options may be granted
under the Plan to those officers and other key employees of the Company or any
Subsidiary who are responsible for or contribute to, or are likely to be
responsible for or contribute to, the management, growth and success of the
Company or any Subsidiary and to non-employee directors of the Company. The
granting of an award or option under the Plan to an officer or other key
employee of the Company or any Subsidiary shall conclusively evidence the
Committee’s determination that such grantee meets one or more of the criteria
referred to in the preceding sentence.

6. Stock Options. A Stock Option may be an Incentive Stock Option or a
Non-Qualified Stock Option. To the extent that any Stock Option does not qualify
as an Incentive Stock Option, it shall constitute a separate Non-Qualified Stock
Option. Stock Options may be granted alone or in addition to other awards made
under the Plan. Stock Options shall be evidenced by agreements in such form as
the Committee shall approve from time to time. The agreements shall contain in
substance the following terms and conditions and may contain such additional
terms and conditions, not inconsistent with the terms of the Plan, as the
Committee shall deem appropriate:

(a) Type of Option. Each option agreement shall identify the Stock Option
represented thereby as an Incentive Stock Option or a Non-Qualified Stock
Option, as the case may be.

(b) Option Price. The option exercise price per share shall not be less than the
Fair Market Value of the Common Stock on the date the Stock Option is granted
and in no event shall be less than the par value of the Common Stock.

(c) Term. Each option agreement shall state the period or periods of time within
which the Stock Option may be exercised, in whole or in part, which shall be
such period or periods of time as the Committee may determine at the time of the
Stock Option grant; provided, that no Stock Option granted under the Plan shall
be exercisable more than ten years after the date of its grant; and provided
further, that each Stock Option granted under the Plan shall become exercisable
one year after the date of its grant, unless the option agreement specifically
provides otherwise. The Committee shall have authority to accelerate previously
established exercise rights, subject to the requirements set forth in the Plan,
under such circumstances and upon such terms and conditions as the Committee
shall deem appropriate.

 

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(d) Payment for Shares. The Committee may permit all or part of the payment of
the option exercise price to be made (i) in cash, by check or by wire transfer
or (ii) in shares of Common Stock (A) which already are owned by the optionee
and which are surrendered to the Company in good form for transfer or (B) which
are retained by the Company from the shares of the Common Stock which would
otherwise be issued to the optionee upon the optionee’s exercise of the Stock
Option. Such shares shall be valued at their Fair Market Value on the date of
exercise of the Stock Option. In lieu of payment in fractions of shares, payment
of any fractional share amount shall be made in cash or check payable to the
Company. The Committee also may provide that the exercise price may be paid by
delivering a properly executed exercise notice in a form approved by the
Committee together with irrevocable instructions to a broker to promptly deliver
to the Company the amount of the applicable sale or loan proceeds required to
pay the exercise price. No shares of Common Stock shall be issued to any
optionee upon the exercise of a Stock Option until the Company receives full
payment therefor as described above.

(e) Rights upon Termination of Employment. In the event that an optionee ceases
to be employed either by the Company or by a Subsidiary for any reason other
than such optionee’s death or Disability, any rights of the optionee under any
Stock Option then in effect immediately shall terminate; provided, that the
optionee (or the optionee’s legal representative) shall have the right to
exercise the Stock Option during its term within a period of three months after
such termination of employment to the extent that the Stock Option was
exercisable at the time of such termination or within such other period and
subject to such other terms and conditions as may be specified by the Committee.
Notwithstanding the foregoing provisions of this Section 6(e), the optionee (and
the optionee’s legal representative) shall not have any rights under any Stock
Option, and the Company shall not be obligated to sell or deliver shares of
Common Stock (or have any other obligation or liability) under any Stock Option,
if the Committee shall determine that (i) the employment of the optionee with
the Company or any Subsidiary has been terminated for cause or (ii) the optionee
has engaged or may engage in employment or activities competitive with the
Company or any Subsidiary or contrary, in the opinion of the Committee, to the
best interests of the Company or any Subsidiary. In the event of such
determination, the optionee (and the optionee’s legal representative) shall have
no right under any Stock Option to purchase any shares of Common Stock
regardless of whether the optionee (or the optionee’s legal representative)
shall have delivered a notice of exercise prior to the Committee’s making of
such determination. Any Stock Option may be terminated entirely by the Committee
at the time of or at any time subsequent to a determination by the Committee
under this Section 6(e) which has the effect of eliminating the Company’s
obligation to sell or deliver shares of Common Stock under such Stock Option.

 

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In the event that an optionee ceases to be employed either by the Company or by
a Subsidiary by reason of such optionee’s Disability, prior to the expiration of
a Stock Option and without such optionee’s having fully exercised such Stock
Option, such optionee or such optionee’s legal representative shall have the
right to exercise such Stock Option during its term within a period of six
months after such termination of employment to the extent that such Stock Option
was exercisable at the time of such termination or within such other period and
subject to such other terms and conditions as may be specified by the Committee.

In the event that an optionee ceases to be employed either by the Company or by
a Subsidiary by reason of such optionee’s death, prior to the expiration of a
Stock Option and without such optionee’s having fully exercised such Stock
Option, the personal representative of such optionee’s estate or the person who
acquired the right to exercise such Stock Option by bequest or inheritance from
such optionee shall have the right to exercise such Stock Option during its term
within a period of twelve months after the date of such optionee’s death to the
extent that such Stock Option was exercisable at the time of such death or
within such other period and subject to such other terms and conditions as may
be specified by the Committee.

The foregoing provisions of this Section 6(e) shall not be applicable to
non-employee directors of the Company.

(f) Rights Upon Termination of Service as a Non-Employee Director. Unless the
applicable option agreement provides otherwise, if an optionee who is a
non-employee director of the Company ceases to be a director of the Company for
any reason other than retirement from the Board under the circumstances
described in the following paragraph of this Section 6(f) or death, then each
outstanding but unexercised Stock Option held by such optionee shall continue to
be exercisable only to the extent that it was exercisable at the time that such
optionee ceased to be a director of the Company and only until the earlier of
(i) three months after such optionee ceased to be a director of the Company or
(ii) the expiration of the term of such Stock Option.

Unless the applicable option agreement provides otherwise, if an optionee who is
a non-employee director of the Company ceases to be a director of the Company
(other than by reason of death) and at the time of such occurrence (the
“Retirement Date”) is at least age 65 with ten or more years of service as a
non-employee director of the Company or is at least age 70 with five or more
years of service as a non-employee director of the Company, then each
outstanding but unexercised Stock Option held by such optionee on the Retirement
Date shall continue to be or become exercisable in accordance with its terms
until the earlier of (i) five years after the Retirement Date or (ii) the
expiration of the term of such Stock Option.

Unless the applicable option agreement provides otherwise, if an optionee who is
a non-employee director of the Company dies, then each outstanding but
unexercised Stock Option which had been held by such grantee for at least twelve
months as of the date of such optionee’s death automatically shall become
exercisable in full (if not already exercisable) upon such optionee’s

 

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death. Each outstanding but unexercised Stock Option which becomes exercisable
pursuant to the preceding sentence and each outstanding but unexercised Stock
Option held by such optionee which was exercisable on the date of such
optionee’s death may be exercised by the legal representative of such optionee’s
estate or by the beneficiaries of such estate to whom such Stock Option is
distributed until the earlier of (i) three years after the date of such
optionee’s death or (ii) the expiration of the term of such Stock Option.

The foregoing provisions of this Section 6(f) shall be applicable only to
non-employee directors of the Company.

To the extent that the aggregate Fair Market Value (determined as of the time
the option is granted) of the Common Stock with respect to which Incentive Stock
Options granted under the Plan (and all other plans of the Company and its
Subsidiaries) become exercisable for the first time by any individual in any
calendar year exceeds $100,000, such Stock Options shall be treated as
Non-Qualified Stock Options. No Incentive Stock Option shall be granted to any
employee if, at the time the option is granted, the employee (in his or her own
right or by reason of the attribution rules applicable under Section 424(d) of
the Code) owns more than 10% of the total combined voting power of all classes
of stock of the Company or any Parent Corporation or Subsidiary unless at the
time such option is granted the option price is at least 110% of the Fair Market
Value of the stock subject to such Stock Option and such Stock Option by its
terms is not exercisable after the expiration of five years from the date of its
grant.

7. Stock Appreciation Rights. Stock Appreciation Rights shall enable the
grantees thereof to benefit from increases in the Fair Market Value of shares of
Common Stock and shall be evidenced by agreements in such form as the Committee
shall approve from time to time. The agreements shall contain in substance the
following terms and conditions and may contain such additional terms and
conditions, not inconsistent with the terms of the Plan, as the Committee shall
deem appropriate:

(a) Award. A Stock Appreciation Right shall entitle the grantee, subject to such
terms and conditions as the Committee may prescribe, to receive upon the
exercise thereof an award equal to all or a portion of the excess of (i) the
Fair Market Value of a specified number of shares of Common Stock at the time of
the exercise of such right over (ii) a specified price which shall not be less
than the Fair Market Value of the Common Stock at the time the right is granted
or, if connected with a previously granted Stock Option, not less than the Fair
Market Value of the Common Stock at the time such Stock Option was granted.
Subject to the limitations set forth in Section 4, such award may be paid by the
Company in cash, shares of Common Stock (valued at their then Fair Market Value)
or any combination thereof, as the Committee may determine. Stock Appreciation
Rights may be, but are not required to be, granted in connection with a
previously or contemporaneously granted Stock Option.

(b) Term. Each agreement shall state the period or periods of time within which
the Stock Appreciation Right may be exercised, in whole or in part, subject to
such terms and conditions prescribed for such purpose by the Committee;
provided, that no Stock Appreciation Right shall be exercisable more than ten
years after the date of its grant; and provided further, that each

 

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Stock Appreciation Right granted under the Plan shall become exercisable one
year after the date of its grant, unless the agreement specifically provides
otherwise. The Committee shall have authority to accelerate previously
established exercise rights, subject to the requirements set forth in the Plan,
under such circumstances and upon such terms and conditions as the Committee
shall deem appropriate.

(c) Rights upon Termination of Employment. In the event that a grantee of a
Stock Appreciation Right ceases to be employed either by the Company or by a
Subsidiary for any reason other than such grantee’s death or Disability, any
rights of the grantee under any Stock Appreciation Right then in effect
immediately shall terminate; provided, that the grantee (or the grantee’s legal
representative) shall have the right to exercise the Stock Appreciation Right
during its term within a period of three months after such termination of
employment to the extent that the Stock Appreciation Right was exercisable at
the time of such termination or within such other period and subject to such
other terms and conditions as may be specified by the Committee. Notwithstanding
the foregoing provisions of this Section 7(c), the grantee (and the grantee’s
legal representative) shall not have any rights under any Stock Appreciation
Right, and the Company shall not be obligated to pay or deliver any cash, Common
Stock or any combination thereof (or have any other obligation or liability)
under any Stock Appreciation Right, if the Committee shall determine that
(i) the employment of the grantee with the Company or any Subsidiary has been
terminated for cause or (ii) the grantee has engaged or may engage in employment
or activities competitive with the Company or any Subsidiary or contrary, in the
opinion of the Committee, to the best interests of the Company or any
Subsidiary. In the event of such determination, the grantee (and the grantee’s
legal representative) shall have no right under any Stock Appreciation Right
regardless of whether the grantee (or the grantee’s legal representative) shall
have delivered a notice of exercise prior to the Committee’s making of such
determination. Any Stock Appreciation Right may be terminated entirely by the
Committee at the time of or at any time subsequent to a determination by the
Committee under this Section 7(c) which has the effect of eliminating the
Company’s obligations under such Stock Appreciation Right.

In the event that a grantee of a Stock Appreciation Right ceases to be employed
either by the Company or by a Subsidiary by reason of such grantee’s Disability,
prior to the expiration of a Stock Appreciation Right and without such grantee’s
having fully exercised such Stock Appreciation Right, such grantee or such
grantee’s legal representative shall have the right to exercise such Stock
Appreciation Right during its term within a period of six months after such
termination of employment to the extent that such Stock Appreciation Right was
exercisable at the time of such termination or within such other period and
subject to such other terms and conditions as may be specified by the Committee.

In the event that a grantee of a Stock Appreciation Right ceases to be employed
either by the Company or by a Subsidiary by reason of such grantee’s death,
prior to the expiration of a Stock Appreciation Right and without such grantee’s
having fully

 

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exercised such Stock Appreciation Right, the personal representative of the
grantee’s estate or the person who acquired the right to exercise such Stock
Appreciation Right by bequest or inheritance from such grantee shall have the
right to exercise such Stock Appreciation Right during its term within a period
of twelve months after the date of such grantee’s death to the extent that such
Stock Appreciation Right was exercisable at the time of such death or within
such other period and subject to such other terms and conditions as may be
specified by the Committee.

The foregoing provisions of this Section 7(c) shall not be applicable to
non-employee directors of the Company.

(d) Rights Upon Termination of Service as a Non-Employee Director. Unless the
applicable agreement provides otherwise, if a grantee of a Stock Appreciation
Right who is a non-employee director of the Company ceases to be a director of
the Company for any reason other than retirement from the Board under
circumstances described in the following paragraph of this Section 7(d) or
death, then each outstanding but unexercised Stock Appreciation Right held by
such grantee shall continue to be exercisable only to the extent that it was
exercisable at the time that such grantee ceased to be a director of the Company
and only until the earlier of (i) three months after such grantee ceased to be a
director of the Company or (ii) the expiration of the term of such Stock
Appreciation Right.

Unless the applicable agreement provides otherwise, if the grantee of a Stock
Appreciation Right who is a non-employee director of the Company ceases to be a
director of the Company (other than by reason of death) and at the time of such
occurrence (the “Retirement Date”) is at least age 65 with ten or more years of
service as a director of the Company or is at least age 70 with five or more
years of service as a director of the Company, then each outstanding but
unexercised Stock Appreciation Right held by such grantee on the Retirement Date
shall continue to be or become exercisable in accordance with its terms until
the earlier of (i) five years after the Retirement Date or (ii) the expiration
of the term of such Stock Appreciation Right.

Unless the applicable agreement provides otherwise, if the grantee of a Stock
Appreciation Right who is a non-employee director of the Company dies, then each
outstanding but unexercised Stock Appreciation Right which had been held by such
grantee for at least twelve months as of the date of such grantee’s death
automatically shall become exercisable in full (if not already exercisable) upon
such grantee’s death. Each outstanding but unexercised Stock Appreciation Right
which becomes exercisable pursuant to the preceding sentence and each
outstanding but unexercised Stock Appreciation Right held by such grantee which
was exercisable on the date of such grantee’s death may be exercised by the
legal representative of such grantee’s estate or by the beneficiaries of such
estate to whom such Stock Appreciation Right is distributed until the earlier of
(i) three years after the date of such grantee’s death or (ii) the expiration of
the term of such Stock Appreciation Right.

 

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The foregoing provisions of this Section 7(d) shall be applicable only to
non-employee directors of the Company.

8. Performance Unit Awards. Performance Unit Awards shall entitle the grantees
thereof to receive future payments based upon and subject to the achievement of
preestablished long-term performance targets and shall be evidenced by
agreements in such form as the Committee shall approve from time to time. The
agreements shall contain in substance the following terms and conditions and may
contain such additional terms and conditions, not inconsistent with the terms of
the Plan, as the Committee shall deem appropriate:

(a) Performance Period. The Committee shall establish with respect to each
Performance Unit Award a performance period of not fewer than two years nor more
than five years.

(b) Unit Value. The Committee shall establish with respect to each Performance
Unit Award a value for each unit which shall not change thereafter or which may
vary thereafter on the basis of criteria specified by the Committee.

(c) Performance Targets. The Committee shall establish with respect to each
Performance Unit Award maximum and minimum performance targets to be achieved
during the applicable performance period. The achievement of the maximum targets
shall entitle a grantee to payment with respect to the full value of a
Performance Unit Award. The achievement of less than the maximum targets, but in
excess of the minimum targets, shall entitle a grantee to payment with respect
to a portion of a Performance Unit Award according to the level of achievement
of the applicable targets as specified by the Committee. To the extent the
Committee deems necessary or appropriate to protect against the loss of
deductibility pursuant to Section 162(m) of the Code, such targets shall be
established in conformity with the requirements of Section 162(m) of the Code.

(d) Performance Measures. Performance targets established by the Committee shall
relate to corporate, division, subsidiary, group or unit performance in terms of
objective financial criteria or performance goals which satisfy the requirements
of Section 162(m) of the Code or, with respect to grantees not subject to
Section 162(m) of the Code, such other measures or standards of performance as
the Committee may determine. Multiple targets may be used and may have the same
or different weighting, and the targets may relate to absolute performance or
relative performance measured against other companies, businesses or indexes.

(e) Adjustments. At any time prior to the payment of a Performance Unit Award,
the Committee may adjust previously established performance targets or other
terms and conditions of such Performance Unit Award, including the Company’s or
another company’s financial performance for Plan purposes, in order to reduce or
eliminate, but not to increase, the payment with respect to a Performance Unit
Award that otherwise would be due upon the attainment of such previously
established performance targets. Such adjustments shall be made to reflect major
unforeseen events or changes in circumstances affecting the Company such as but
not limited to changes in laws, regulations or accounting principles, mergers,
acquisitions or divestitures, or other extraordinary, unusual or nonrecurring
items or events.

 

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(f) Payment of Performance Unit Awards. Upon the conclusion of each performance
period, the Committee shall determine the extent to which the applicable
performance targets have been attained and any other terms and conditions have
been satisfied for such period and shall provide such certification thereof as
may be necessary to satisfy the requirements of Section 162(m) of the Code. The
Committee shall determine what, if any, payment is due on a Performance Unit
Award and, subject to the limitations set forth in Section 4, whether such
payment shall be made in cash, shares of Common Stock (valued at their then Fair
Market Value) or a combination thereof. Payment of a Performance Unit Award
shall be made in a lump sum or in installments, as determined by the Committee,
commencing as promptly as practicable after the end of the performance period
unless such payment is deferred upon such terms and conditions as may be
specified by the Committee.

(g) Termination of Employment. In the event that a grantee of a Performance Unit
Award ceases to be employed either by the Company or by a Subsidiary for any
reason other than such grantee’s death or Disability, any rights of such grantee
under any Performance Unit Award then in effect whose performance period has not
ended shall terminate immediately; provided, that the Committee may authorize
the partial payment of any such Performance Unit Award if the Committee
determines such action to be equitable.

In the event that a grantee of a Performance Unit Award ceases to be employed
either by the Company or by a Subsidiary by reason of such grantee’s death or
Disability, any rights of such grantee under any Performance Unit Award then in
effect whose performance period has not ended shall terminate immediately;
provided, that the Committee may authorize the payment to such grantee or such
grantee’s legal representative of all or any portion of such Performance Unit
Award to the extent earned under the applicable performance targets, even though
the applicable performance period has not ended, upon such terms and conditions
as may be specified by the Committee.

9. Restricted Stock Awards. Restricted Stock Awards shall consist of shares of
Common Stock restricted against transfer, subject to a substantial risk of
forfeiture and to other terms and conditions intended to further the purpose of
the Plan as the Committee may determine, and shall be evidenced by agreements in
such form as the Committee shall approve from time to time. The agreements shall
contain in substance the following terms and conditions and may contain such
additional terms and conditions, not inconsistent with the terms of the Plan, as
the Committee shall deem appropriate:

(a) Restriction Period. The Common Stock covered by Restricted Stock Awards
shall be subject to the applicable restrictions established by the Committee
over such period as the Committee shall determine. To the extent the Committee
deems necessary or appropriate to protect against the loss of deductibility
pursuant to Section 162(m) of the Code, Restricted Stock Awards also may be
subject to the attainment of one or more preestablished performance objectives
which relate to

 

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corporate, subsidiary, division, group or unit performance in terms of objective
financial criteria or performance goals which satisfy the requirements of
Section 162(m) of the Code; provided, that any such preestablished financial
criteria or performance goals subsequently may be adjusted by the Committee to
reduce or eliminate, but not to increase, a Restricted Stock Award in order to
take into account unforeseen events or changes in circumstances affecting the
Company such as but not limited to changes in laws, regulations or accounting
principles, mergers, acquisitions or divestitures, or other extraordinary,
unusual or nonrecurring items or events.

(b) Restriction upon Transfer. Shares of Common Stock covered by Restricted
Stock Awards may not be sold, assigned, transferred, exchanged, pledged,
hypothecated or otherwise encumbered, except as provided in the Plan or in any
Restricted Stock Award agreement entered into between the Company and a grantee,
during the restriction period applicable to such shares. Notwithstanding the
foregoing provisions of this Section 9(b), and except as otherwise provided in
the Plan or the applicable Restricted Stock Award agreement, a grantee of a
Restricted Stock Award shall have all of the other rights of a holder of Common
Stock including but not limited to the right to receive dividends and the right
to vote such shares.

(c) Payment. The Committee shall determine the amount, form and time of payment,
if any, that shall be required from the grantee of a Restricted Stock Award in
consideration of the issuance and delivery of the shares of Common Stock covered
by such Restricted Stock Award.

(d) Certificates. Each certificate issued in respect of shares of Common Stock
covered by a Restricted Stock Award shall be registered in the name of the
grantee and shall bear substantially the following legend (in addition to any
other legends which may be appropriate):

“This certificate and the shares of stock represented hereby are subject to the
terms and conditions (including forfeiture provisions and restrictions against
transfer) contained in the CSG Systems International, Inc. 2005 Stock Incentive
Plan and a Restricted Stock Award Agreement entered into between the registered
owner and CSG Systems International, Inc. Release from such terms and conditions
may be obtained only in accordance with the provisions of such Plan and
Agreement, a copy of each of which is on file in the office of the Secretary of
CSG Systems International, Inc.”

The Committee may require the grantee of a Restricted Stock Award to enter into
an escrow agreement providing that the certificates representing the shares
covered by such Restricted Stock Award will remain in the physical custody of an
escrow agent until all restrictions are removed or expire and may require that
the certificates held in such escrow be accompanied by a stock power, endorsed
in blank by the grantee, relating to the Common Stock covered by such
certificates. The Company also may use a book-entry system of uncertificated
shares to administer grants of Restricted Stock Awards and to effect any
withholding required by Section 15.

 

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(e) Lapse of Restrictions. Except for preestablished performance objectives
established with respect to Restricted Stock Awards to grantees subject to
Section 162(m) of the Code, the Committee may provide for the lapse of
restrictions applicable to Common Stock subject to Restricted Stock Awards in
installments and may waive such restrictions in whole or in part based upon such
factors and such circumstances as the Committee shall determine. Upon the lapse
of such restrictions, subject to the provisions of Section 15, certificates for
shares of Common Stock, free of the restrictive legend set forth in
Section 9(d), shall be issued to the grantee or the grantee’s legal
representative automatically in the case of certificated shares or upon the
request of the grantee in the case of uncertificated shares. The Committee shall
have authority to accelerate the expiration of the applicable restriction period
with respect to all or any portion of the shares of Common Stock covered by a
Restricted Stock Award except, with respect to grantees subject to
Section 162(m) of the Code, to the extent such acceleration would result in the
loss of the deductibility of such Restricted Stock Award pursuant to
Section 162(m) of the Code.

(f) Termination of Employment. In the event that a grantee of a Restricted Stock
Award ceases to be employed either by the Company or by a Subsidiary or to serve
as a non-employee director of the Company for any reason, any rights of such
grantee with respect to shares of Common Stock that remain subject to
restrictions under such Restricted Stock Award shall terminate immediately, and
any shares of Common Stock covered by a Restricted Stock Award with unlapsed
restrictions shall be subject to reacquisition by the Company upon the terms set
forth in the applicable agreement with such grantee. The Committee may provide
for complete or partial exceptions to such employment or service requirement if
the Committee determines such action to be equitable.

10. Stock Bonus Awards. The Committee may grant a Stock Bonus Award to an
eligible grantee under the Plan based upon corporate, division, subsidiary,
group or unit performance in terms of preestablished objective financial
criteria or performance goals or, with respect to participants not subject to
Section 162(m) of the Code, such other measures or standards of performance
(including but not limited to performance already accomplished) as the Committee
may determine; provided, that any such preestablished financial criteria or
performance goals subsequently may be adjusted to reduce or eliminate, but not
to increase, a Stock Bonus Award in order to take into account unforeseen events
or changes in circumstances affecting the Company such as but not limited to
changes in laws, regulations or accounting principles, mergers, acquisitions or
divestitures, or other extraordinary, unusual or nonrecurring items or events.

If appropriate in the sole discretion of the Committee, Stock Bonus Awards shall
be evidenced by agreements in such form as the Committee shall approve from time
to time. In addition to any applicable performance goals or standards and
subject to the terms of the Plan, shares of Common Stock which are the subject
of a Stock Bonus Award may be (i) subject to additional restrictions (including
but not limited to restrictions on transfer) or (ii) granted directly to a
grantee free of any restrictions, as the Committee shall deem appropriate.

 

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11. General Restrictions. Each award or grant under the Plan shall be subject to
the requirement that if at any time the Committee shall determine that (i) the
listing, registration or qualification of the shares of Common Stock subject or
related thereto upon any securities exchange or under any state or federal law,
(ii) the consent or approval of any governmental regulatory body, or (iii) an
agreement by the grantee of an award or grant with respect to the disposition of
the shares of Common Stock subject or related thereto is necessary or desirable
as a condition of, or in connection with, such award or grant or the issuance or
purchase of shares of Common Stock thereunder, then such award or grant may not
be consummated and any rights thereunder may not be exercised in whole or in
part unless such listing, registration, qualification, consent, approval or
agreement shall have been effected or obtained upon conditions acceptable to the
Committee. Awards or grants under the Plan shall be subject to such additional
terms and conditions, not inconsistent with the Plan, as the Committee in its
sole discretion deems necessary or desirable, including but not limited to such
terms and conditions as are necessary to enable a grantee to avoid any
short-swing profit recapture liability under Section 16 of the Exchange Act.

12. Single or Multiple Agreements. Multiple forms of awards or grants or
combinations thereof may be evidenced either by a single agreement or by
multiple agreements, as determined by the Committee.

13. Rights of a Stockholder. Unless otherwise provided by the Plan, the grantee
of any award or grant under the Plan shall have no rights as a stockholder of
the Company with respect to the shares of Common Stock subject or related to
such award or grant unless and until certificates for such shares of Common
Stock are issued to such grantee or until uncertificated shares have been
credited to an account established for such grantee.

14. No Right to Continue Employment or Service as a Director. Nothing in the
Plan or in any agreement entered into pursuant to the Plan shall confer upon any
grantee who is an employee of the Company or any Subsidiary 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
grantee with or without cause. Nothing in the Plan or in any agreement entered
into pursuant to the Plan shall confer upon any grantee who is a non-employee
director of the Company the right to continue to serve as a director of the
Company.

15. Withholding. The Company’s obligation to (i) deliver shares of Common Stock
or pay cash upon the exercise of any Stock Option or Stock Appreciation Right,
(ii) deliver shares of Common Stock or pay cash in payment of any Performance
Unit Award, (iii) deliver stock certificates upon the vesting of any Restricted
Stock Award, and (iv) deliver shares of Common Stock upon the grant of any Stock
Bonus Award shall be subject to applicable federal, state and local tax
withholding requirements. In the discretion of the Committee, amounts required
to be withheld for taxes may or must be paid by the grantee in cash or shares of
Common Stock (either through the surrender of previously held shares of Common
Stock or the withholding of shares of Common Stock otherwise issuable or
deliverable upon the exercise, payment or vesting of such Stock Option, Stock
Appreciation Right or Award) having a Fair

 

15

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Market Value equal to the required tax withholding amount and upon such other
terms and conditions as the Committee shall determine; provided, that any
election by a grantee subject to Section 16(b) of the Exchange Act to pay any
tax withholding in shares of Common Stock shall be subject to and must comply
with any applicable rules under Section 16(b) of the Exchange Act.

16. Indemnification. No member of the Board or the Committee, and no officer or
employee of the Company or a Subsidiary acting on behalf of the Board or the
Committee, shall be personally liable for any action, determination or
interpretation taken or made in good faith with respect to the Plan or any award
or option granted under the Plan; and all members of the Board or the Committee
and each and any officer or employee of the Company or any Subsidiary acting on
their behalf shall, to the fullest extent permitted by law, be fully indemnified
and held harmless by the Company in respect of any such action, determination or
interpretation.

17. Non-Assignability. No award or grant under the Plan shall be assignable or
transferable by the recipient thereof except by will, by the laws of descent and
distribution or, in the case of awards or grants other than Incentive Stock
Options, pursuant to a qualified domestic relations order. No right or benefit
under the Plan shall be liable for the debts, liabilities, or alimony or child
support obligations of the person entitled to such right or benefit, either by
assignment, attachment or any other method, and shall not be subject to be taken
by the creditors or alimony or child support obligees of the person entitled to
such right or benefit by any process whatsoever.

18. Nonuniform Determinations. The Committee’s determinations under the Plan
(including but not limited to determinations of the persons to receive awards or
grants, the form, amount and timing of such awards or grants, the terms and
provisions of such awards or grants and the agreements evidencing them, and the
establishment of values and performance targets) need not be uniform and may be
made by the Committee selectively among the persons who receive, or are eligible
to receive, awards or grants under the Plan, whether or not such persons are
similarly situated.

19. Adjustments. In the event of any change in the outstanding shares of Common
Stock, by reason of a stock dividend or distribution, stock split,
recapitalization, merger, reorganization, consolidation, split-up, spin-off,
combination of shares, exchange of shares or other change in corporate structure
affecting the Common Stock, the Committee shall make appropriate adjustments in
(a) the aggregate number of shares of Common Stock (i) reserved for issuance
under the Plan, (ii) for which grants or awards may be made to an individual
grantee, and (iii) covered by outstanding awards and grants denominated in
shares or units of Common Stock, (b) the exercise or other applicable price
related to outstanding awards or grants, and (c) the appropriate Fair Market
Value and other price determinations relevant to outstanding awards or grants
and shall make such other adjustments as may be equitable under the
circumstances; provided, that the number of shares subject to any award or grant
always shall be a whole number.

20. Terms of Payment. Subject to any other applicable provisions of the Plan and
to any applicable laws, whenever payment by a grantee is required with respect
to shares of Common Stock which are the subject of an award or grant under the
Plan, the Committee

 

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shall determine the time, form and manner of such payment, including but not
limited to lump-sum payments and installment payments upon such terms and
conditions as the Committee may prescribe. Installment payment obligations of a
grantee may be evidenced by full-recourse, limited-recourse or non-recourse
promissory notes or other instruments, with or without interest and with or
without collateral or other security as the Committee may determine.

21. Termination and Amendment. The Board may terminate the Plan or amend the
Plan or any provision thereof at any time, including but not limited to
amendments to the Plan necessary to comply with the requirements of
Section 16(b) of the Exchange Act, Section 162(m) of the Code, Section 422 of
the Code or regulations issued under any of such statutory provisions. The
termination or any amendment of the Plan shall not, without the consent of a
grantee, adversely affect such grantee’s rights under an award or grant
previously made to such grantee under the Plan. The Committee may amend the
terms of any award or grant previously made under the Plan, prospectively or
retroactively; but, subject to the provisions of Section 19, no such amendment
shall (i) except as otherwise expressly permitted by the Plan, adversely affect
the rights of the grantee of such award or grant without such grantee’s consent
or (ii) without stockholder approval, reduce the exercise price of an
outstanding Stock Option or Stock Appreciation Right or cancel or amend an
outstanding Stock Option or Stock Appreciation Right for the purpose of
repricing, replacing or regranting such Stock Option or Stock Appreciation Right
with an exercise price that is less than the original exercise price of such
Stock Option or Stock Appreciation Right. Notwithstanding the foregoing
provisions of this Section 21, stockholder approval of any action referred to in
this Section 21 shall be required whenever necessary to satisfy the applicable
requirements of Section 16(b) of the Exchange Act, Section 162(m) of the Code,
Section 422 of the Code or any regulations issued under any of such statutory
provisions or the applicable requirements of any market or exchange on which
shares of the Common Stock are listed or traded.

22. Severability. With respect to participants subject to Section 16 of the
Exchange Act, (i) the Plan is intended to comply with all applicable conditions
of Rule 16b-3 or any successor to such rule, (ii) all transactions involving
grantees who are subject to Section 16(b) of the Exchange Act are subject to
such conditions, regardless of whether the conditions are expressly set forth in
the Plan, and (iii) any provision of the Plan that is contrary to a condition of
Rule 16b-3 shall not apply to grantees who are subject to Section 16(b) of the
Exchange Act. If any of the terms or provisions of the Plan, or awards or grants
made under the Plan, conflict with the requirements of Section 162(m) or
Section 422 of the Code with respect to awards or grants intended to be subject
to or governed by Section 162(m) or Section 422 of the Code, as the case may be,
then such terms or provisions shall be deemed to be inoperative to the extent
they so conflict with the requirements of Section 162(m) or Section 422 of the
Code, as the case may be. With respect to an Incentive Stock Option, if the Plan
does not contain any provision required to be included in the Plan under
Section 422 of the Code (as amended from time to time) or any successor to such
section, then such provision shall be deemed to be incorporated in the Plan with
the same force and effect as if such provision had been expressly set out in the
Plan.

23. Effect on Other Plans. Participation in the Plan shall not affect the
eligibility of an employee or a non-employee director of the Company to
participate in any other benefit or incentive plan of the Company or any
Subsidiary. Any awards made pursuant to

 

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the Plan shall not be taken into account in determining the benefits provided or
to be provided under any other plan of the Company or any Subsidiary unless
otherwise specifically provided in such other plan.

24. Term of Plan. The Plan shall become effective on the date of its approval by
the stockholders of the Company and shall terminate for purposes of further
grants on the first to occur of (i) December 31, 2014, or (ii) the effective
date of the termination of the Plan by the Board pursuant to Section 21. No
awards or options may be granted under the Plan after the termination of the
Plan, but such termination shall not affect any awards or options outstanding
under the Plan at the time of such termination or the authority of the Committee
to continue to administer the Plan apart from the making of further grants.

25. Governing Law. The Plan shall be governed by and construed in accordance
with the laws of Delaware.

26. Section 409A.

(a) Time and Form of Payment. Notwithstanding anything contained in the Plan or
in an award agreement to the contrary, the time and form of payment of an award
that is subject to the limitations imposed by Section 409A of the Code shall be
set forth in the applicable award agreement on or before the time at which the
grantee of the award obtains a legally binding right to the award (or such other
time permitted under Section 409A of the Code) and such time and form of payment
shall comply with the requirements of Section 409A of the Code.

(b) Delay in Payment. Notwithstanding anything contained in the Plan or an award
agreement to the contrary, if the grantee of the award is deemed by the Company
at the time of such grantee’s “separation from service” with the Company to be a
“specified employee” as determined under Section 409A of the Code, any
nonqualified deferred compensation to which such grantee is entitled under the
Plan in connection with such separation from service shall not be paid or
commence payment until the date which is the first business day following the
six-month period after such grantee’s separation from service (or if earlier,
such grantee’s death). Such delay in payment shall only be effected with respect
to each separate payment to the extent required to avoid adverse tax treatment
to such grantee under Section 409A of the Code. Any compensation which would
have otherwise been paid during the delay period (whether in a lump sum or in
installments) in the absence of this Section 26 shall be paid to such grantee or
such grantee’s Beneficiary in a lump-sum payment on the first business day
following the expiration of the delay period.

(c) Amendments. Notwithstanding anything in the Plan to the contrary, the Plan
and awards granted under the Plan are intended to be eligible for certain
regulatory exceptions to the limitations of, or to comply with, the requirements
of Section 409A of the Code. The Committee, in the exercise of its sole
discretion and without the consent of the grantee of an award under the Plan,
may amend or modify the terms of an award in any manner and delay the payment of
any amounts payable pursuant to an award to the minimum extent necessary to
reasonably comply with the requirements of Section 409A of

 

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the Code, provided that the Company shall not be required to assume any
increased economic burden. No action so taken by the Committee with respect to
the requirements of Section 409A of the Code shall be deemed to adversely affect
the rights of a grantee of an award under the Plan with respect to an award or
to require the consent of such grantee. The Committee reserves the right to make
additional changes to the Plan and awards from time to time to the extent it
deems necessary with respect to Section 409A of the Code.

 

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