Exhibit 10.12**EMPLOYMENT SECURITY AGREEMENT**This Employment Security Agreement (the “Agreement”) is entered into as of this _____ day of _____ , by and between APAC Customer Services, Inc. (the “Employer”) and _____ (the “Executive”).**WITNESSETH:****WHEREAS,**the Executive is currently employed by the Employer as its _____ ;and**WHEREAS,**in the event of a change in control of the Employer, the Employer desires to providecertain security to the Employer and the Executive, and to retain the Executive’s continueddevotion of the Executive’s business time and attention to the Employer’s affairs; and**WHEREAS,**the Executive and the Employer desire to enter into this Agreement, which sets forththe terms of the security the Employer is providing the Executive with respect to the Executive’semployment in the event of a change in control of the Employer;**NOW, THEREFORE,**in consideration of the mutual covenants and promises contained herein, andother good and valuable consideration, the receipt and sufficiency of which are herebyacknowledged, the Employer and the Executive agree as follows:1. **Definitions.**For purposes of this Agreement, the following terms shall have the meaningsset forth below:(a) ***“Base Salary”***shall mean the higher of the Executive’s annual base salary at the rate ineffect on (i) the date of a Change in Control, or (ii) the date the Executive’s Employmentterminates without regard to any reduction made in connection with an event constituting GoodReason hereunder.(b) ***“Bonus”***shall mean the bonus based on the Executive’s Base Salary that is payable to theExecutive under the Employer’s annual incentive bonus plan, as in effect from time to time or undera successor annual incentive plan, at the target payout level in effect on the date the Executive’sEmployment terminates without regard to any reduction made in connection with an event constitutingGood Reason hereunder or on the date of a Change in Control, whichever produces a greater result.(c) **“Cause”**shall exist only if: (i) The Executive is grossly negligent or engages ingross misconduct in the performance of his employment duties;  (ii) The Executive willfully disobeys the lawfuldirections received from the Company or from the person to whom theExecutive directly reports or of established policies of the Company; or
 
 

 
 (iii) The Executive commits a crime involving fraud ormoral turpitude that can reasonably be expected to have an adverse effecton the business, reputation or financial situation of the Employer.(d) ***“Change in Control”***shall mean any of the following events: (i) A tender offer shall be made and consummated for theownership of more than 50% of the outstanding voting securities of theEmployer;  (ii) The Employer shall be merged or consolidated withanother corporation and as a result of such merger or consolidation lessthan 50% of the outstanding voting securities of the surviving orresulting corporation shall be owned in the aggregate by the formershareholders of the Employer, as the same shall have existed immediatelyprior to such merger or consolidation;  (iii) The Employer shall sell all or substantially all ofits assets to another corporation which is not a wholly-owned subsidiaryor affiliate;  (iv) As the result of, or in connection with, anycontested election for the Board of Directors of the Employer, or anytender or exchange offer, merger or business combination or sale ofassets, or any combination of the foregoing (a “Transaction”), the personswho were Directors of the Employer before the Transaction shall cease toconstitute a majority of the Board of Directors of the Employer, or anysuccessor thereto; or  (v) A person, within the meaning of Section 3(a)(9) or ofSection 13(d)(3) (as in effect on the date hereof) of the Securities andExchange Act of 1934 (“Exchange Act”), other than any employee benefitplan then maintained by the Employer, shall acquire more than 50% of theoutstanding voting securities of the Employer (whether, directly,indirectly, beneficially or of record). For purposes hereof, ownership ofvoting securities shall take into account and shall include ownership asdetermined by applying the provisions of Rule 13d-3(d)(l)(i) (as in effecton the date hereof) pursuant to the Exchange Act.Notwithstanding the foregoing, (A) a Change in Control will not occur for purposes of thisAgreement merely due to the death of Theodore G. Schwartz, or as a result of the acquisition byTheodore G. Schwartz, alone or with one or more affiliates or associates, as defined in theExchange Act, of securities of the Employer, as part of a going-private transaction or otherwise,unless Mr. Schwartz or his affiliates, associates, family members or trusts for the benefit offamily members (collectively, the “Schwartz
 
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Entities”) do not control, directly or indirectly, at least twenty-seven percent (27%) of theresulting entity, and (B) if the Schwartz Entities control, directly or indirectly, less thantwenty-seven (27%) percent of the Employer’s voting securities while it is a public company, then“33-1/3%” shall be substituted for “50%” in clauses (i) and (v) of this Section 2(d), and “66-2/3%”shall be substituted for “50%” in clause (ii) of this Section 2(d).(e) ***“Disability”***shall mean, to the extent such term is not defined in an EmploymentAgreement, if any, a physical or mental condition that entitles the Executive to benefits under theEmployer-sponsored long term disability plan in which the Executive participates.(f) ***“Employment”***shall mean being in the employ of the Employer.(g) ***“Employment Agreement”***shall mean a written agreement between the Executive and theEmployer covering the terms and conditions of Executive’s employment with the Employer.(h) ***“Good Reason”***shall exist if, after notice by the Executive within 30 days of theexistence of one of the following conditions, such notice given to the Employer and providing athirty (30) day opportunity by the Employer to cure (during which it does not cure the condition): (i) The principal place of work (not including regularbusiness travel) is relocated by more than fifty (50) miles;  (ii) The Executive’s duties, responsibilities or authorityas an executive employee are materially reduced or diminished from thosein effect immediately prior to a Change in Control without the Executive’swritten consent, provided that any reduction or diminishment in any of theforegoing resulting merely from the acquisition of the Employer and itsexistence as a subsidiary or division of another entity shall not besufficient to constitute Good Reason;  (iii) Executive’s base salary is reduced; or  (iv) The Employer violates the material terms of thisAgreement, or an employment agreement, if any.2. **Term.**The term of this Agreement shall be the period commencing on the effective date firstset forth above and terminating on the date the Executive’s employment with the Employer isterminated; provided that, if the Executive’s employment is terminated following a Change inControl under the circumstances described in Section 3, the term shall continue in effect until allpayments and benefits have been made or provided to the Executive hereunder.
 
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In the event of a liquidation, dissolution, consolidation or merger of the Employer ortransfer of all or a significant portion of its assets, Employer will cause a successor orsuccessors (by merger, consolidation or otherwise) to which all or a significant portion of itsassets have been transferred to assume (either by operation of law or otherwise) all duties andobligations of the Employer under this Agreement and any employment agreement.3. **Benefits Upon Termination of Employment**. If (i) the Employer terminates the Executive’sEmployment without Cause coincident with or at any time within 12 months following a Change inControl; or (ii) the Executive terminates the Executive’s Employment by resignation due to an eventconstituting Good Reason that occurs coincident with or at any time within 12 months following aChange in Control, the Executive shall be entitled to receive the following:(a) ***Severance Pay.***The Employer shall pay to the Executive an amount equal to [12 FOR VPS and18 FOR SVPS] months of the Executive’s Base Salary and [1 for VPS and 1-1/2 FOR SVPS] times theExecutive’s Bonus. Subject to Subsection (d) below, payment shall be made in a lump sum withinthirty (30) days after termination of the Executive’s Employment.(b) ***Stock Options.***To the extent the Executive has any outstanding option or options topurchase common stock of the Employer as of the date of the Change in Control, the exercisabilityof such options shall be determined in accordance with the terms of the Employer’s stock optionplan then in effect, and/or a written agreement entered into by the Employer and the Executive,which covers the terms and conditions of the exercise of such option or options.(c) ***Health Benefits.***The Employer shall provide to the Executive, the Executive’s spouse orbeneficiary continued medical, dental, life, disability coverages and such other benefits asprovided under any other welfare plans or programs in which he participated immediately prior tohis termination for a period of [12 FOR VPS and 18 FOR SVPS] months on the same basis as providedto other employees as of the date of termination. Following such period, the Employer shall makeavailable to such persons any benefit continuation or conversion of rights otherwise provided atthe time an employee’s employment terminates (without offset for the coverage provided pursuant tothe previous sentence), under the Employer’s established welfare plans.(d) Notwithstanding anything in this Agreement to the contrary, if Executive is deemed as ofthe date of Executive’s termination of Employment to be a “specified employee” for purposes ofSection 409A(a)(2)(B)(i) of the Internal Revenue Code (the “Code”), to the extent delayedcommencement of any portion of the severance payments to which Executive is entitled under thisAgreement is required in order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) ofthe Code, such portion of the severance payments will not be provided to Executive prior to theearlier of (1) the expiration of the six-month period measured from the date of the Executive’s“separation from service” with the Company (as such term is defined in the Treasury Regulationsissued under Section 409A of the Code) or (2) Executive’s death. Upon the expiration of theapplicable Code Section 409A(a)(2)(B)(i) deferral period, all payments deferredpursuant to this Section 3 shall be paid in a lump sum to Executive, and any remainingpayments due shall be paid as otherwise provided herein.
 
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In addition, to the extent that an Employment Agreement, if any, or such other writtenagreement between the Executive and the Employer, expressly covers the terms of severance payable,if any, and such other benefits available to the Executive upon termination of his Employmentfollowing a Change in Control, such Employment Agreement or other agreement shall govern andsupersede the terms of this Agreement if such severance payable or other benefits are morefavorable to the Executive than those provided in this Agreement.4. **No Setoff**.(a) The payments and benefits made or provided to the Executive, the Executive’s spouse orother beneficiary under this Agreement shall not be reduced by the amount of any claim of theEmployer against the Executive or the Executive’s spouse or other beneficiary for any debt orobligation of the Executive or the Executive’s spouse or other beneficiary to the Employer.(b) The Executive shall have no duty to seek employment following termination of Employment orotherwise to mitigate damages. The amounts or benefits payable or available to the Executive, theExecutive’s spouse or other beneficiary under this Agreement shall not be reduced by any amount theExecutive may earn or receive from employment with another employer or from any other source.5. **Existing Rights.**Any payments and benefits under this Agreement are in lieu of benefits towhich the Executive may be entitled under any severance plan or policy of the Employer, but are inaddition to any other benefits due to the Executive, the Executive’s spouse or other beneficiariesfrom the Employer, including, but not limited to, payments under any other welfare or retirementplan maintained by the Employer in which the Executive is or was eligible to participate. Noprovision in this Agreement shall be construed to reduce or impair the Executive’s rights andbenefits under such welfare or retirement plans.6. **Other Termination**.(a) ***Termination Before Change in Control.***If the Executive’s Employment is terminated for anyreason before a Change in Control, severance payments, if any, due to the Executive shall bedetermined under the Employer’s severance plans or policies then in effect, and/or the Executive’sEmployment Agreement, if any. In such circumstances, the Executive shall not be entitled to anypayments or benefits under this Agreement, and the Employer shall have no further obligation to theExecutive hereunder, except to the extent provided under any welfare, retirement or other plan,policy or arrangement maintained by the Employer in which the Executive is or was eligible toparticipate.
 
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(b) ***Termination for Cause or Without Good Reason.***If, following a Change in Control, (i) theExecutive’s Employment is terminated for Cause by the Board of Directors acting in good faith by written notice by the Employer to the Executivespecifying the event relied upon for such termination, or (ii) the Executive terminates theExecutive’s Employment without Good Reason, the Executive shall receive the Executive’s Base Salaryat the rate then in effect on the date the, Executive’s Employment terminates paid through the dateof termination. In such circumstances, the Executive shall not be entitled to any payments orbenefits under this Agreement, and the Employer shall have no further obligation to the Executivehereunder, except to the extent provided under any welfare, retirement or other plan, policy orarrangement maintained by the Employer in which the Executive is or was eligible to participate.(c) ***Death or Disability.***If the Executive’s Employment is terminated by reason of death orDisability, the Executive, the Executive’s spouse or other beneficiary, as the case may be, shallnot be entitled to any payments or benefits under this Agreement, and the Employer shall have nofurther obligation to the Executive hereunder except to the extent provided under any welfare,retirement or other plan, policy or arrangement maintained by the Employer in which the Executiveis or was eligible to participate.7. **Section 280G.**Notwithstanding any provision of this Agreement to the contrary, in the eventthat:(a) The aggregate payments or benefits to be made or afforded to the Executive under the thisAgreement or from the Company in any other manner (the “Termination Benefits”) would be deemed toinclude an “excess parachute payment” under Section 280G of the Code, or any successor thereto, and(b) If such Termination Benefits were reduced to an amount (the “Non-Triggering Amount”), thevalue of which is one dollar ($1.00) less than the amount that would result in an “excess parachutepayment” under Section 280G of the Code, and the Non-Triggering Amount would be greater than theaggregate value of Termination Benefits (without such reduction) minus the amount of tax requiredto be paid by Executive thereon by Section 4999 of the Code, then the Termination Benefits shall bereduced so that the Termination Benefits are not more than the Non-Triggering Amount. Theapplication of said Section 280G, and the allocation of the reduction required by this Section,shall be determined by the Company’s auditors.8. **Beneficiaries.**If the Executive is entitled to payments and benefits under thecircumstances described above in Section 3, but dies before all amounts payable and benefitsavailable thereunder have been paid or provided, the remaining payments and benefits shall be madeor provided to the Executive’s surviving spouse, if any, or other beneficiary designated in awriting delivered to the Employer (and in such form as is prescribed by the Employer). If theExecutive has no surviving spouse, and has not designated a beneficiary, the remaining paymentsshall be made to the Executive’s estate.
 
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9. **Full Satisfaction; Waiver and Release**. As a condition to receiving the payments andbenefits hereunder, the Executive shall execute a document in customary form, releasing and waivingany and all claims, causes of actions and the like against the Employer, their respectivesuccessors, shareholders, officers, trustees, agents and employees, regarding all matters relatingto the Executive’s service as an employee of the Employer and to the termination of suchrelationship. Such claims *include, without limitation,*any claims arising under the AgeDiscrimination in Employment Act of 1967, as amended (the “ADEA”); Title VII of the Civil RightsAct of 1964, as amended; the Civil Rights Act of 1991, as amended; the Equal Pay Act of 1962, asamended; the Americans With Disabilities Act of 1990, as amended; the Family Medical Leave Act, asamended; the Employee Retirement Income Security Act of 1974, as amended; or any other federal,state or local statute or ordinance, *but exclude*claims arising under the ADEA to challenge theprovisions of this Section 8, and any claims that arise out of an asserted breach of the terms ofthis Agreement or claims related to the matters described in Section 5.10. **Assignment.**Except as provided above in Section 8, the Employer may not assign thisAgreement, or any rights, duties or obligations hereunder, *except that*the Employer’s rights,duties, and obligations shall be binding obligations of any successor, as provided in Section 2. Nointerest of the Executive (or the Executive’s spouse or other beneficiary) nor any right to receiveany payment or distribution hereunder shall be subject to sale, transfer, assignment, pledge,attachment or garnishment or otherwise be assigned or encumbered. No such interest or right shallbe taken, voluntarily or involuntarily, for the satisfaction of the obligations or debts of, orother claims against, the Executive (or the Executive’s spouse or other beneficiary), includingclaims for alimony, child support, separate maintenance and claims in bankruptcy.11. **Source of Payment.**The rights created under this Agreement are unfunded promises toprovide severance pay and other benefits described herein in the event of the termination of theExecutive’s Employment under the circumstances described above in Section 3. The Employer shall notsegregate assets for purposes of payment for any amounts due hereunder, nor shall any provisioncontained herein be interpreted to require the Employer to segregate assets for purposes ofproviding payment of any benefit hereunder. The Executive, the Executive’s spouse, or otherbeneficiary shall not have any interest in or right against any specific assets of the Employer,and any rights shall be limited to those of a general unsecured creditor.12. **Miscellaneous**.(a) ***Entire Agreement; Amendment.***This Agreement contains the entire Agreement andunderstanding between the Employer and the Executive and, except for any employment agreement andstock option agreements, supersedes all other agreements, written or oral, relating to the paymentof severance or any other benefit in the event of a Termination of Employment Without Cause or withGood Reason in the event of a Change of Control, as described herein. Any amendment or modificationof the terms of this Agreement must be in writing and signed by the Employer and the Executive tohave any binding effect upon the parties.
 
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(b) ***Applicable Law.***Except to the extent preempted by federal law, this Agreement is governedby, and shall be construed and interpreted in accordance with the substantive laws of the State ofIllinois, not including the choice of law provisions thereof.(c) ***No Employment Rights.***Nothing contained herein shall be construed to confer upon theExecutive any right to continue in the employment of the Employer, or to limit the right of theEmployer to terminate the Executive’s employment at any time, with or without Cause, subject to theExecutive’s rights hereunder with respect to such termination.(d) ***Notices.***All notices under this Agreement shall be in writing and shall be deemed to havebeen made when delivered or mailed by registered, or certified mail, or by a nationally recognizedovernight delivery service, postage or charges prepaid. All notices to the Company shall be sentto:APAC Customer Services, Inc.