EXHIBIT 10.65
 
AMENDMENT TO SERIES D CONVERTIBLE STOCK PURCHASE AGREEMENT
 
This Amendment, dated as of August 29, 2008 (the “Amendment”), is to that
certain Series D Convertible Stock Purchase Agreement, which was dated as of
June 13, 2007, by and among BPO Management Services, Inc. (the “Company”), and
the purchasers listed on Exhibit A thereto (the “Purchasers”).  The Company and
the Purchasers are, together, the “Parties.”
 
RECITALS
 
WHEREAS, the Parties entered into that certain Series D Convertible Preferred
Stock Purchase Agreement, dated June 13, 2007 (the “Stock Purchase Agreement”),
pursuant to which the Purchasers purchased shares of the Company’s Series D
Convertible Preferred Stock and warrants to purchase shares of the Company’s
Series D-2 Convertible Preferred Stock and Common Stock;
 
WHEREAS, subsequent to the Closing (as that term is defined in the Stock
Purchase Agreement), certain of the Warrants (as that term is defined in the
Stock Purchase Agreement) were exercised by certain of the Purchasers;
 
WHEREAS, subsequent to the Closing, certain of the provisions of the Warrants
were amended in the manners provided therein, certain of which amendments
included an approval of the Warrant Exchange (as that term is defined
hereinbelow);
 
WHEREAS, subsequent to the Closing, certain provisions of the Company’s
Certificate of Designation of the Relative Rights and Preferences of the Series
D Convertible Preferred Stock and Certificate of Designation of the Relative
Rights and Preferences of the Series D-2 Convertible Preferred Stock
(collectively, the “D and D-2 Preferred Stock Designations”) were amended in the
manner provided therein and in the Stock Purchase Agreement;
 
WHEREAS, the Company has requested that certain provisions of the Stock Purchase
Agreement be amended in the manner set forth hereinbelow and those Purchasers
executing this Amendment have been willing so to amend the Stock Purchase
Agreement;
 
WHEREAS, in order to simplify its capital structure, the Company previously
decided to offer the Purchasers the opportunity to exchange all of their
then-outstanding Series A Warrants to Purchase Shares of Common Stock of the
Company, Series B Warrants to Purchase Shares of Common Stock of the Company,
and of the Series D Warrants to Purchase Shares of Common Stock of the Company
if such Series D Warrants have a warrant price of $1.10 per share for shares of
a to-be-designated series of the Company’s preferred stock (the “Warrant
Exchange”), which shares of such series of preferred stock will be convertible
into shares of the Company’s common stock and have such other rights as will be
agreed upon among the Company and the Purchasers and specified in the
certificate of designation of rights for such series;
 
WHEREAS, the Warrant Exchange was previously approved by the Purchasers;
 
 
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WHEREAS, in furtherance of the Warrant Exchange, the Company has decided to
offer the Purchasers and their permitted assigns the opportunity (the form of
which is attached hereto as Exhibit WE) to exchange all of their outstanding
Series A Warrants to Purchase Shares of Common Stock of the Company, Series B
Warrants to Purchase Shares of Common Stock of the Company, and Series D
Warrants to Purchase Shares of Common Stock of the Company (if such Series D
Warrants have a warrant price of $1.10 per share) for shares of its Series F
Convertible Preferred Stock (the form of which Certificate of Designation of the
Relative Rights and Preferences of the Series F Convertible Preferred Stock is
attached hereto as Exhibit F) and those Purchasers (including their permitted
assigns) who have executed this Amendment have agreed to participate in the
Warrant Exchange;
 
WHEREAS, this Amendment shall be deemed to have been executed by the Company and
those Purchasers (including their permitted assigns) whose signatures appear
hereinbelow immediately prior to the closing of the Warrant Exchange;
 
WHEREAS, this Amendment shall be deemed to incorporate by reference any
requisite amendments to the Warrants and consents to the D and D-2 Preferred
Stock Designations, such that no rights of any of the Purchasers herein or
therein and no obligations of the Company herein or therein shall be deemed to
have been triggered, or to have been given rise to such triggering, by the
transactions contemplated hereby or by the Warrant Exchange;
 
WHEREAS, the Company and the Purchasers and their permitted assigns whose
signatures appear hereinbelow desire to amend Section 9.15 of the Stock Purchase
Agreement to increase the number of shares of the Company’s common stock
underlying permitted options;
 
NOW, THEREFORE, in consideration of the promises and covenants made herein, and
for such other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties hereby agree as follows:
 
ARTICLE 1
AMENDMENT
 
1.           Amendment to Section9.15 of the Stock Purchase Agreement.
 
1.1           Section 9.15 – 2007 Stock Incentive Plan.  Certain changes shall
be made to Section 9.15, as follows:
 
“Remove ‘Four Million Six Hundred Thousand [sic] (4,666,667)’ and in its stead
insert ‘Twelve Million Three Hundred Sixty-six Thousand Six Hundred Sixty-seven
(12,366,667)’; remove ‘Two Million Three Hundred Thousand [sic] (2,333,334)’ and
in its stead insert ‘Eight Million Three Hundred Thirty-three Thousand Three
Hundred Thirty-four (8,333,334).’”
 
1.2           Broad Interpretation.  In addition to the specific amendments made
to the text of the Stock Purchase Agreement set as forth herein, it is the
intention of the Company and those Purchasers (including their permitted
assigns) whose signatures appear hereinbelow that this Amendment be broadly
interpreted and construed so that in no event shall any actions taken by the
Company in connection herewith or the Warrant Exchange be deemed to trigger, or
give rise to the triggering of, any rights of any of the Purchasers or any
obligations of the Company in the Stock Purchaser Agreement or herein or in any
of the Warrants or in the D and D-2 Preferred Stock Designations.
 

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1.3           Effectiveness of Amendment.  The foregoing amendments shall be
effective and binding upon the Purchasers and their respective successors and
assigns independently of whether the Purchasers (and their permitted assigns)
execute and deliver this Amendment to the Company in the event that this
document amends the Stock Purchase Agreement in the manner provided for therein.
 
ARTICLE 2
MISCELLANEOUS PROVISIONS
 
2.           Miscellaneous Provisions.
 
2.1           No Further Amendments.  Except as amended by this Amendment and as
required for conformity to the previous amendments to the Warrants and to the
previous consents of the Purchasers, the Stock Purchase Agreement remains
unmodified and in full force and effect.  In the event of any inconsistency
between the provisions of the Stock Purchase Agreement, the Warrants (as
previously amended), and the provisions of this Amendment, the provisions of
this Amendment shall prevail.  This Amendment may only be modified or amended by
a written agreement in the manner set provided by the Stock Purchase Agreement.
 
2.2           Counterparts.  This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original but all of which when
taken together shall constitute one and the same instrument.  Facsimiles or
portable document files transmitted by e-mail containing original signatures
shall be deemed for all purposes to be originally signed copies of the documents
which are the subject of such facsimiles or files.
 
2.3           Binding on Successors. This Amendment shall be binding upon and
shall inure to the benefit of the successors and permitted assigns of the
Parties.
 
2.4           Entire Agreement.  The Stock Purchase Agreement, as amended
hereby, the Warrants, as previously amended, the D and D-2 Preferred Stock
Designations, as previously amended, the Certificate of Designation of the
Relative Rights and Preferences of the Series F Convertible Preferred Stock, and
the Warrant Exchange Agreement collectively contain the entire understanding
among the Parties and supersede any prior written or oral agreements among them
respecting the subject matter contained herein.  There are no representations,
agreements, arrangements or understandings, oral or written, among the Parties
relating to the subject matter hereof that are not fully expressed herein and
therein.
 
[SIGNATURE PAGES TO FOLLOW]
 
 
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IN WITNESS WHEREOF, the Parties hereto have executed or have caused a duly
authorized officer to execute this Amendment all effective as of the day and
year first above written.

 
THE COMPANY:
 
BPO MANAGEMENT SERVICES, INC.,
a Delaware corporation
 
 

By:  /s/ Patrick A. Dolan   Name:  Patrick A. Dolan   Its: 
Chief Executive Officer
 

 

THE PURCHASERS:
 
The undersigned hereby consents to the amendment set forth herein.
 
 

VISION OPPORTUNITY MASTER FUND, LTD.             By:   /s/ Adam Benowitz   Name:
Adam Benowitz    Its: Director               
RENAISSANCE CAPITAL GROWTH & INCOME FUND III, INC.
           
By:
/s/ Russell Cleveland    
Russell Cleveland
President
     
RENAISSANCE US GROWTH INVESTMENT TRUST PLC
           
By:
/s/ Russell Cleveland    
Russell Cleveland
President
 

 
 
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US SPECIAL OPPORTUNITIES TRUST PLC
            By: /s/ Russell Cleveland  
 
Russell Cleveland
President
                   
PREMIER RENN US EMERGING GROWTH FUND LTD.
            By: /s/ Russell Cleveland  
 
Russell Cleveland
President
           
BRIDGEPOINTE MASTER FUND LTD.
            By:    
 
Name:
Title:
                   
HELLER CAPITAL INVESTMENTS LLC
           
By:
/s/ Russell Cleveland    
Name:
Title:
 

 
 
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