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Exhibit 10.27  

 
 

AEGIS COMMUNICATIONS GROUP, INC.
  AMENDED AND RESTATED
  1998 STOCK OPTION PLAN
  (As Amended Through August 8, 2001)    
  

        1.    Purpose of the Plan.    This Plan shall be known as the Aegis Communications Group, Inc. Amended and Restated
1998 Stock Option Plan. The purposes of the Plan are (i) to attract and retain the best available personnel for positions of substantial responsibility, (ii) to attract and retain
directors and advisory directors with a high degree of training, experience and ability and (iii) to provide incentives to such personnel, directors and advisory directors to promote the
success of the business of Aegis Communications Group, Inc. and its subsidiaries. 

        Certain
options granted under this Plan are intended to qualify as "incentive stock options" pursuant to Section 422 of the Internal Revenue Code of 1986, as amended from time to
time, while certain other options granted under the Plan will constitute nonqualified options. 

        2.    Definitions.    As used herein, the following definitions shall apply: 

        (a)  "Board"
means the Board of Directors of the Corporation. 

        (b)  "Common
Stock" means the Common Stock, $.01 par value per share, of the Corporation. Except as otherwise provided herein, all Common Stock issued pursuant to the Plan
shall have the same rights as all other issued and outstanding shares of Common Stock, including but not limited to voting rights, the right to dividends, if declared and paid, and the right to pro
rata distributions of the Corporation's assets in the event of liquidation. 

        (c)  "Code"
means the Internal Revenue Code of 1986, as amended from time to time. 

        (d)  "Committee"
means the committee described in Section 18(a) that administers the Plan. 

        (e)  "Corporation"
means Aegis Communications Group, Inc., a Delaware corporation. 

        (f)    "Date
of Grant" means the date on which an Option is granted pursuant to this Plan or, if the Committee so determines, the date specified by the Committee as the date
the award is to be effective. 

        (g)  "Director"
means any director, advisory director or consultant of the Corporation or one of its Subsidiaries, but excluding any director, advisory director or consultant
who is also an officer or employee of the Corporation or one of its Subsidiaries. 

        (h)  "Employee"
means any officer or other key employee of the Corporation or one of its Subsidiaries, including any director who is also an officer or key employee of the
Corporation or one of its Subsidiaries. 

        (i)    "Exchange
Act" means the Securities Exchange Act of 1934, as amended. 

        (j)    "Executive"
means an Employee who is, or in the judgment of the Committee may become, the Chief Executive Officer of the Corporation or one of the other four most highly
compensated executive officers of the Corporation. 

        (k)  "Fair
Market Value" means the closing sale price (or average of the quoted closing bid and asked prices if there is no closing sale price reported) of the Common Stock
on the trading day immediately prior to the date specified as reported by The Nasdaq Stock Market or by the principal national stock exchange on which the Common Stock is then listed. If there is no
reported price information for the Common Stock, the Fair Market Value will be determined by the Committee, in its sole discretion. In making such determination, the Committee may, but shall not be
obligated to, commission and rely upon an independent appraisal of the Common Stock. 

        (l)    "Non-Employee
Director" means an individual who is a "non-employee director" as defined in Rule16b-3 under the Exchange Act and also an "outside director" within the
meaning of Treasury Regulation § 1.162-27(e)(3). 

        (m)  "Nonqualified
Option" means any Option that is not a Qualified Option. 

        (n)  "Option"
means a stock option granted pursuant to Section 6 of this Plan. 

        (o)  "Optionee"
means any Employee or Director who receives an Option. 

        (p)  "Participant"
means any Employee or Director who receives an Option pursuant to this Plan. 

        (q)  "Plan"
means the Aegis Communications Group, Inc. 1998 Stock Option Plan, as amended from time to time. 

        (r)  "Qualified
Option" means any Option that is intended to qualify as an "incentive stock option" within the meaning of Section 422 of the Code. 

        (s)  "Rule
16b-3" means Rule 16b-3 of the rules and regulations under the Exchange Act, as Rule 16b-3 may be amended from time to time, and any successor provisions to
Rule 16b-3 under the Exchange Act. 

        (t)    "Subsidiary"
means any now existing or hereinafter organized or acquired company of which more than fifty percent (50%) of the issued and outstanding voting stock is
owned or controlled directly or indirectly by the Corporation or through one or more Subsidiaries of the Corporation. 

        3.    Term of Plan.    The Plan was initially adopted by the Board effective as of April 7, 1998. To permit the
granting of Qualified Options under the Code, and to qualify awards of Options hereunder as "performance based" under Section162(m) of the Code, the Plan was approved by the shareholders of the
Corporation on July 9, 1998. On March 29, 2000, the Board approved the following amendments to the Plan: 

	(a)
	increase
in the number of shares issuable upon the exercise of Options pursuant to this Plan from 7,500,000 to 9,000,000; and

	(b)
	increase
in the annual limit on the number of option shares issuable to an individual executive officer from 1,500,000 to 3,000,000. 

On
May 4, 2000, these amendments to the Plan were approved by the shareholders of the Corporation. 

On
June 27, 2001, the Board approved an increase in the number of shares issuable upon the exercise of Options pursuant to this Plan from 9,000,000 to 12,000,000. On August 8, 2001, this amendment to
the Plan was approved by the shareholders of the Corporation. 

The
Plan, as amended, shall continue in effect until terminated pursuant to Section 18(a). 

        4.    Shares Subject to the Plan.    Except as otherwise provided in Section 17 hereof, the aggregate number of shares
of Common Stock issuable upon the exercise of Options pursuant to this Plan shall be 12,000,000 shares; provided, however, that on January 1 of each year (commencing on January 1, 1999),
the aggregate number of shares of Common Stock then issuable upon the exercise of Options shall be increased by the same percentage that the total number of issued and outstanding shares of Common
Stock increased from the preceding January 1 to the following December31 (if such percentage is positive). For example, if the total number of issued and outstanding shares of Common Stock on
January 1, 1999 were 50,000,000, the total number of issued and outstanding shares of the Corporation on December 31, 1999 were 55,000,000, and the aggregate number of shares of Common
Stock then issuable upon the exercise of Options pursuant to this Plan were 2,500,000, the aggregate number of shares of Common Stock issuable under the Plan effective January 1, 2000 would be
2,750,000 (a 10% increase). Notwithstanding the above, the aggregate number of shares of Common Stock issuable upon the exercise of Qualified Options pursuant to this plan shall not exceed 9,000,000
shares. Shares issuable upon the exercise of Options may either be authorized but unissued shares or treasury shares. The Corporation shall, during the term of this Plan, reserve and keep available a 

number of shares of Common Stock sufficient to satisfy the requirements of the Plan. If an Option should expire or become unexercisable for any reason without having been exercised in full, then the
shares that were subject thereto shall, unless the Plan shall have terminated, become immediately available for the grant of additional Options under this Plan, subject to the limitations and
adjustments set forth above. In addition, for purposes of calculating the aggregate number of shares that may be issued under this Plan, only the net shares issued (including the shares, if any,
withheld for tax withholding requirements) shall be counted when shares of Common Stock are used as full or partial payment for shares issued upon exercise of a Qualified Option or a Nonqualified
Stock Option. Shares tendered by a Participant as payment for shares issued upon such exercise shall be available for reissuance under the Plan. 

        5.    Eligibility.    Qualified Options may be granted under Section 6 of the Plan to such Employees of the
Corporation or its Subsidiaries as may be determined by the Committee. Nonqualified Options may be granted under Section 6 of the Plan to such Employees or Directors of the Corporation or its
Subsidiaries as may be determined by the Committee. Subject to the limitations and qualifications set
forth in this Plan, the Committee shall also determine the number of Options to be granted, the number of shares subject to each Option grant, the exercise price or prices of each Option, the vesting
and exercise period of each Option, whether an Option may be exercised as to less than all of the Common Stock subject thereto, and such other terms and conditions of each Option as are consistent
with the provisions of this Plan. In connection with the granting of Qualified Options, the aggregate Fair Market Value (determined at the Date of Grant of a Qualified Option) of the shares with
respect to which Qualified Options are exercisable for the first time by an Optionee during any calendar year (under all such plans of the Optionee's employer corporation and its parent and subsidiary
corporations as defined in Section 424(e) and (f) of the Code, or a corporation or a parent or subsidiary corporation of such corporation issuing or assuming an Option in a transaction to which
Section 424(a) of the Code applies (collectively, such corporations described in this sentence are hereinafter referred to as "Related Corporations")) shall not exceed $100,000 or such other
amount as from time to time provided in Section 422(d) of the Code or any successor provision. In the event that the Participant's total Qualified Options exceed the $100,000 limit in any
calendar year (whether due to acceleration of exercisability, miscalculation, error or otherwise) the amount of Qualified Options that exceed such limit shall be treated as Nonqualified Options. The
Qualified Options granted earliest (whether under this Plan or any other agreement or plan) shall be applied first to the $100,000 limit. In the event that only a portion of the Qualified Options
granted at the same time can be applied to the $100,000 limit, the Corporation shall issue separate share certificates for such number of shares as does not exceed the $100,000 limit, and shall
designate such shares as Qualified Option stock in its share transfer records. 

        6.    Grant of Options.    Except as provided in Section 18(c), the Committee shall determine the number of shares of
Common Stock to be offered from time to time pursuant to Options granted hereunder and shall grant Options under the Plan. Notwithstanding the foregoing, each member of the Committee shall be eligible
to receive Options only if the Board unanimously (except for such Committee member) grants such Option to such member. The grant of Options shall be evidenced by Option agreements containing such
terms and provisions as are approved by the Committee and executed on behalf of the Corporation by an appropriate officer. In connection with the granting of any Options under the Plan, the aggregate
number of shares of Common Stock with respect to which Options may be granted to any single Executive in any one calendar year shall not exceed 3,000,000. Solely for this purpose, Options that lapse
or are canceled continue to count against such limit. 

        7.    Time of Grant of Options.    The date of grant of an Option under the Plan shall be the date on which the
Committee awards the Option or, if the Committee so determines, the date specified by the Committee as the date the award is to be effective. Notice of the grant shall be given to each Participant to
whom an Option is granted promptly after the date of such grant. 

        8.    Price.    The exercise price for each share of Common Stock subject to an Option (the "Exercise Price") granted
pursuant to Section 6 of the Plan shall be determined by the Committee at the Date of Grant; provided, however, that (a) the Exercise Price for any Option shall not be less than 100% of the
Fair Market Value of the Common Stock at the Date of Grant, and (b) if the Optionee 

owns on the Date of Grant more than 10 percent of the total combined voting power of all classes of stock of the Corporation or its parent or any of its subsidiaries, as more fully described in
Section 422(b)(6) of the Code or any successor provision (such shareholder is referred to herein as a
"10-Percent Shareholder"), the Exercise Price for any Qualified Option granted to such Optionee shall not be less than 110% of the Fair Market Value of the Common Stock at the Date of Grant. 

        9.    Vesting.    Subject to Section 11 of this Plan, each Option award under the Plan shall vest or be subject to
forfeiture in accordance with the provisions set forth in the applicable Option agreement. The Committee may, but shall not be required to, permit acceleration of vesting or termination of forfeiture
provisions upon any sale of the Corporation or similar transaction. In the event that the acceleration of any Option hereunder upon a change of control of the Corporation or similar transaction would
result in an "excess parachute payment" (as defined in Section 280G of the Code), the Participant's Option agreement shall specify whether the exercisability of the full number of shares shall
be accelerated. In the event that the Option agreement does not specify whether the exercisability of the full number of shares shall be accelerated and the Committee determines that an excess
parachute payment would result if acceleration occurred (when added to any other payments or benefits contingent on a change of control under any other agreements, arrangements or plans), then the
number of shares as to which excercisability is accelerated shall be reduced so that total parachute payments do not exceed 299% of the Optionee's "base amount," as defined in
Section 280G(b)(3) of the Code. A Participant's Option agreement may contain such additional provisions with respect to vesting as the Committee may specify. 

        10.    Exercise.    A Participant may pay the Exercise Price of the shares of Common Stock as to which an Option is
being exercised by the delivery of (a) cash, (b) check, (c) at the Corporation's option, by the delivery of shares of Common Stock having a Fair Market Value on the date
immediately preceding the exercise date equal to the Exercise Price and have been held by the Optionee at least six (6) months prior to the date of exercise, or (d) at the Corporation's option,
any other consideration that the Corporation determines is consistent with the Plan's purpose and applicable law. If the shares to be purchased are covered by an effective registration statement under
the Securities Act of 1933, as amended, any Option granted under the Plan may be exercised by a broker-dealer acting on behalf of an Optionee if (i) the broker-dealer has received from the
Optionee or the Corporation a fully- and duly-endorsed agreement evidencing such Option, together with instructions signed by the Optionee requesting the Corporation to deliver the shares of Common
Stock subject to such Option to the broker-dealer on behalf of the Optionee and specifying the account into which such shares should be deposited, (ii) adequate provision has been made with
respect to the payment of any withholding taxes due upon such exercise, and (iii) the broker-dealer and the Optionee have otherwise complied with Section 220.3(e)(4) of Regulation T, 12
CFR Part 220, or any successor provision. 

        11.    When Qualified Options May be Exercised.    No Qualified Option shall be exercisable at any time after the
expiration of ten (10) years from the Date of Grant; provided, however, that if the Optionee with respect to a Qualified Option is a 10-Percent Shareholder on the Date of Grant of such Qualified
Option, then such Option shall not be exercisable after the expiration of five (5) years from its Date of Grant. In addition, if an Optionee of a Qualified Option ceases to be an employee of the
Corporation or any Related Corporation for any reason, such Optionee's vested Qualified Options shall not be exercisable after (a) three (3) months following the date such Optionee ceases to be an
employee of the Corporation or any Related Corporation, if such cessation of service is not due to the death or permanent and total disability (within the meaning of Section 22(e)(3) of the Code) of
the Optionee, or (b) twelve (12) months following the date such Optionee ceases to be an employee of the Corporation or any Related Corporation, if such cessation of service is due to the death or
permanent and total disability (as defined above) of the Optionee. Upon the death of an Optionee, any vested Qualified Option exercisable on the date of death may be exercised by the Optionee's estate
or by a
person who acquires the right to exercise such Qualified Option by bequest or inheritance or by reason of the death of the Optionee, provided that such exercise occurs within both the remaining option
term of the Qualified Option and twelve (12) months after the date of the Optionee's death. This Section 11 

only provides the outer limits of allowable exercise dates with respect to Qualified Options; the Committee may determine that the exercise period for a Qualified Option shall have a shorter duration
than as specified above. 

        12.    Option Financing.    Upon the exercise of any Option granted under the Plan, the Corporation may, but shall not
be required to, make financing available to the Participant for the purchase of shares of Common Stock pursuant to such Option on such terms as the Board or the Committee may specify. 

        13.    Withholding of Taxes.    The Committee shall make such provisions and take such steps as it may deem necessary
or appropriate for the withholding of any taxes that the Corporation is required by any law or regulation of any governmental authority to withhold in connection with any Option including, but not
limited to, (a) withholding the issuance of all or any portion of the shares of Common Stock subject to such Option until the Participant reimburses the Corporation for the amount it is
required to withhold with respect to such taxes, (b) withholding any portion of such issuance in an amount sufficient to reimburse the Corporation for the amount of taxes it is required to
withhold, (c) allowing the Participant to deliver Common Stock as payment for the amount the Corporation is required to withhold for taxes or (d) taking any other action reasonably required to
satisfy the Corporation's withholding obligation. 

        14.    Conditions Upon Issuance of Shares.    

        (a)  The
Corporation shall not be obligated to sell or issue any shares upon the exercise of any Option granted under the Plan unless the issuance and delivery of shares
comply with all provisions of applicable federal and state securities laws and the requirements of The Nasdaq Stock Market or any stock exchange upon which shares of the Common Stock may then be
listed. 

        (b)  As
a condition to the exercise of an Option, the Corporation may require the person exercising the Option to make such representations and warranties as may be necessary
to assure the availability of an exemption from the registration requirements of applicable federal and state securities laws. 

        (c)  The
Corporation shall not be liable for refusing to sell or issue any shares covered by any Option if the Corporation cannot obtain authority from the appropriate
regulatory bodies deemed by the Corporation to be necessary to sell or issue such shares in compliance with all applicable federal and state securities laws and the requirements of The Nasdaq Stock
Market or any stock exchange upon which shares of the Common Stock may then be listed. In addition, the Corporation shall have no
obligation to any Participant, express or implied, to list, register or otherwise qualify the shares of Common Stock covered by any Option. 

        (d)  No
Participant will be, or will be deemed to be, a holder of any Common Stock subject to an Option unless and until such Participant has exercised his or her Option and
paid the purchase price for the subject shares of Common Stock. 

        15.    Restrictions on Transfer.    

        (a)  Options
issued pursuant to the Plan shall be nontransferable except by will or the laws of descent and distribution, and may only be exercisable during the Participant's
lifetime only by the Participant. 

        (b)  Shares
of Common Stock issued pursuant to the Plan may be subject to restrictions on transfer under applicable federal and state securities laws. The Committee may
impose such additional restrictions on the ownership and transfer of shares of Common Stock issued pursuant to the Plan as it deems desirable; any such restrictions shall be set forth in any Option
agreement entered into hereunder. 

        16.    Modification of Plan and Options.    

        (a)  The
Committee may from time to time and at any time alter, amend, suspend, discontinue or terminate this Plan; provided, however, that no such action of the Committee
may, without the approval of the shareholders of the Corporation, alter the provisions of the Plan so as to (i) increase 

the maximum number of shares of Common Stock that may be subject to Qualified Options under this Plan (except as provided in Section 17 of this Plan), (ii) change the class of employees
eligible to receive Qualified Options pursuant to this Plan, or (iii) change the annual limit on the number of Options granted to an Executive in Section 6 above. 

        (b)  At
any time and from time to time, the Committee may execute an instrument providing for modification, extension or renewal of any outstanding Option, provided that no
such modification, extension or renewal shall impair the Option without the consent of the holder of the Option. Notwithstanding the foregoing, (i) in the event of such a modification,
substitution, extension or renewal of a Qualified Option, the Committee may increase the exercise price of such Option if necessary to retain the qualified status of such Option, and (ii) the
Committee may, in its discretion and without the holder's consent, convert, any Qualified Option into a Nonqualified Option. 

        17.    Effect of Change in Stock Subject to the Plan.    In the event that each of the outstanding shares of Common
Stock (other than shares held by dissenting shareholders) shall be changed into or exchanged for a different number or kind of shares of stock of the Corporation or of another corporation (whether by
reason of merger, consolidation, recapitalization, reclassification, split-up, combination of shares or otherwise), or in the event a stock split or stock dividend occurs, then the Corporation may
either (a) substitute for each share of Common Stock then subject to Options or available for Options the number and kind of shares of stock into which each outstanding share of Common Stock
(other than shares held by dissenting shareholders) shall be so changed or exchanged, or the number of shares of Common Stock as is equitably required in the event of a stock split or stock dividend,
together with an appropriate adjustment of the Exercise Price, or (b) cancel all such Options as of the effective date of any merger, consolidation, recapitalization, reclassification, split-up
or combination of shares by giving written notice to each holder thereof or his personal representatives of its intention to do so and by permitting the exercise of all such Options, without regard to
determinations of periods or installments of exercisability during the thirty (30) day period immediately preceding such effective date. The Committee may, but shall not be required to, provide
additional anti-dilution protection to a Participant under the terms of the Participant's Option agreement. 

        18.    Administration.    

        (a)  Notwithstanding
anything to the contrary herein, to the extent necessary to comply with the requirements of Rule 16b-3, the Plan shall be administered by the Board, if
each member is a Non-Employee Director, or by a committee comprised solely of two or more Non-Employee Directors appointed by the Board (the group responsible for administering the Plan is referred to
as the "Committee"). Options may be granted under Section 6 only by majority agreement of the members of the Committee. Option agreements, in the form as approved by the Committee, and
containing such terms and conditions consistent with the provisions of this Plan as are determined by the Committee, may be executed on behalf of the Corporation by the Chairman of the Board, the
President or any Vice President of the Corporation. The Committee shall have complete authority to construe, interpret and administer the provisions of this Plan and the provisions of the Option
agreements granted hereunder; to prescribe, amend and rescind rules and regulations pertaining to this Plan; to suspend, discontinue or terminate this Plan; and to make all other determinations
necessary or deemed advisable in the administration of the Plan. The determinations, interpretations and constructions made by the Committee shall be final and conclusive. No member of the Committee
shall be liable for any action taken, or failed to be taken, made in good faith relating to the Plan or any award thereunder, and the members of the Committee shall be entitled to indemnification and
reimbursement by the Corporation in respect of any claim, loss, damage or expense (including attorneys' fees) arising therefrom to the fullest extent permitted by law. 

        (b)  Members
of the Committee shall be specified by the Board, and shall consist solely of Non-Employee Directors. Non-Employee Directors may not possess an interest in any
transaction for which disclosure is required under Section 404(a) of Regulation S-K under the Exchange Act or be engaged in a business relationship that must be disclosed under
Section 404(a) and must qualify as 'outside directors' as defined in Section 162(m) of the Code and regulations thereunder. 

        (c)  Although
the Committee may suspend, discontinue or terminate the Plan at any time, all Qualified Options must be granted within ten (10) years from the effective date of
the Plan or the date the Plan is approved by the shareholders of the Corporation, whichever is earlier. 

        19.    Continued Employment Not Presumed.    Nothing in this Plan or any document describing it nor the grant of any
Option shall give any Participant the right to continue in the employment of the Corporation or affect the right of the Corporation to terminate the employment of any such person with or without
cause. 

        20.    Liability of the Corporation.    Neither the Corporation, its directors, officers or employees or the
Committee, nor any Subsidiary which is in existence or hereafter comes into existence, shall be liable to any Participant or other person if it is determined for any reason by the Internal Revenue
Service or any court having jurisdiction that any Qualified Option granted hereunder does not qualify for tax treatment as an incentive stock option under Section 422 of the Code. 

        21.    Governing Law.    The Plan shall be governed by and construed
in accordance with the laws of State of Delaware and the United States, as applicable, without reference to the conflict of laws provisions thereof.

        22.    Severability of Provisions.    If any provision of this Plan is determined to be invalid, illegal or
unenforceable, such invalidity, illegality or unenforceability shall not affect the remaining provisions of the Plan, but such invalid, illegal or unenforceable provision shall be fully severable, and
the Plan shall be construed and enforced as if such provision had never been inserted herein. 

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EMPLOYMENT AGREEMENT    
  

        THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as of December 3, 2001, by and among Aegis Communications Group, Inc., a
Delaware corporation (the "Parent"), Advanced Telemarketing Corporation, a Nevada corporation ("ATC"), IQI, Inc., a New York corporation ("IQI") (together, ATC and IQI are referred to as the
"Company"), and Lee O. Waters ("Employee"). 

R
E C I T A L S: 

        The
Company and the Parent desire to employ Employee under the terms and conditions of this Agreement. Employee represents that as of the effective date of this Agreement, Employee is
free from any other obligation of continuing employment with his former employer. 

        Employee
desires employment by the Company and the Parent under the terms and conditions of this Agreement and further desires to be granted access to the Company's and the Parent's
proprietary information. 

        NOW,
THEREFORE, in consideration of the mutual covenants and agreements set forth in this Agreement, the parties agree as follows: 

        1.    Employment.    Subject to the terms and conditions set forth in this Agreement, each of the Company and the
Parent employ Employee, and Employee accepts such employment by the Company and the Parent. 

        2.    Duties of Employee.

        (a)  Employee
will serve in the capacities of Executive Vice President Client/Market Development of each of the Company and the Parent, subject in each case to the reasonable
supervision of the President and CEO of the Company and the Parent. In such capacity, Employee will have all necessary
powers to discharge his responsibilities, subject in each case to the President's and CEO's supervision and control. Employee will report to the President and the CEO of the Company and the Parent. 

        (b)  Commencing
3 December 2001, (the "Effective Date") and during the remaining term of this Agreement, Employee will devote his full business time and effort to the
performance of his duties and responsibilities as Executive Vice President Client/Market Development of the Company and the Parent. Notwithstanding the foregoing, Employee may spend reasonable amounts
of time on his personal civic and charitable activities that do not interfere with the performance of his duties and responsibilities to the Company and the Parent. 

        (c)  Employee
will comply with the written rules and regulations of the Company and the Parent respecting their businesses and perform the reasonable directives and policies
of the Company and the Parent as they may from time to time be stated to Employee verbally or in writing by the President and CEO and the Board of Directors of each corporation. 

        (d)  Employee
will comply with the Company and Parent policy regarding maintenance of accurate business records as may from time to time be required by the Company or the
Parent. Such records may be examined by the Company or the Parent, as the case may be, at all reasonable times after written request is delivered to Employee. Any such document will be delivered to
the Company or the Parent, as the case may be, promptly upon request. 

        (e)  Employee
agrees not to solicit or receive any income or other compensation from any third party in connection with his employment with the Company and the Parent. The
Employee agrees, upon written request by the Company or the Parent, to render an accounting of all transactions relating to his business endeavors during the term of this employment hereunder. 

        3.    Term.    The term of this Agreement (the "Term") will commence on the Effective Date and continue until
terminated in accordance with Section 8 of this Agreement. 

        4.    Salary.    Commencing on the Effective Date, the Parent will pay Employee an annual base salary during the term
of this Agreement for his services as Executive Vice President Administration of 

 

the Company and the Parent of $225,000, which will be payable in installments in accordance with the Parent's standard payroll practice, but not less than bi-weekly. Such base salary will
not include any
benefits made available to Employee or any contributions or payments made on his behalf pursuant to any employee benefit plan or program of the Parent, including any health, disability or life
insurance plan or program, 401K plan, cash bonus plan, stock incentive plan, retirement plan or similar plan or program of any nature. Employee's performance and base salary will be reviewed by the
President and CEO and the Board of Directors annually (at the regularly scheduled Board meeting occurring nearest in time to each anniversary of the Effective Date) and in the discretion of the Board
of Directors or the compensation committee thereof, may be increased, but not decreased without Employee's consent, by such amount as the Board of Directors or such committee shall determine. The
Company will have no separate salary obligation to Employee. 

        5.    Bonus Compensation.

        (a)  The
Parent will pay Employee annual performance based cash bonuses of up to 75% of Employee's then current salary in accordance with the bonus plan adopted by the Board
of Directors for each applicable year. 

        (b)  The
Company shall have no separate obligations to Employee with respect to bonus compensation, but shall be jointly and severally liable with the Parent for the payment
of the bonus payments contemplated by subparagraph (a) above. 

        6.    Employee Benefits.    During the term of this Agreement, the Parent will provide Employee with all benefits made
available from time to time by the Parent to its employees generally and to Executives who hold positions similar to that of Employee (including the benefits granted to other officers of the Parent),
such benefits to be in accordance with the Parent's policies. Specifically, employee's benefits will include, at a minimum, participation in medical and dental benefit plans or programs (providing
coverage for Employee's immediate family); disability insurance; 401-K plans as soon as Employee is eligible to participate in such plans; term life insurance payable to Employee's
designated beneficiary; up to two weeks' sick leave annually or personal leave (if needed); and three weeks' paid vacation. 

        7.    Reimbursement of Expenses.    The Parent will reimburse Employee, in accordance with Parent and Company policy,
for all expenses actually and reasonably incurred by him in the business interests of the Parent or the Company. Reimbursement will be made to Employee upon appropriate documentation of such
expenditures in accordance with the Parent's written policies. 

        8.    Early Termination.    It is the desire and expectation of each party that the employer-employee relationship
will continue as specified herein and be a pleasant and rewarding experience for the parties hereto. The Company or the Parent will, however, be entitled to terminate Employee's employment at any time
with or without Cause (as defined in this Section 8). If the Parent or the Company terminate Employee's employment without Cause, if the Parent or the Company terminate Employee's employment
following a Change in Control (as defined in this Section 8), or Employee terminates such employment following occurrence of an Employee Termination Event, however, the Parent will pay Employee
twelve months' salary as severance compensation (based on Employee's then
current annual base salary) in accordance with the Parent's standard payroll practice, but not less than monthly. The Company will have no separate obligation to Employee with respect to severance
compensation, but shall be jointly and severally liable with Parent for the prompt payment of the salary obligations set forth herein. 

        If
Employee dies, is unable to perform his duties and responsibilities as a result of disability that continues for 120 consecutive days or more or that exists for 180 days in any
twelve month period ("Disability"), voluntarily resigns from the Company or the Parent (other than a termination by Employee following occurrence of an Employee Termination Event), or is terminated
for Cause, the 

2

 

Parent will pay Employee (or his estate, executor or legal representative, as appropriate) any salary that has accrued to the date employment ceases, and the Parent's obligations to pay additional
salary or cash compensation or benefits will terminate as of such date. 

        "Cause,"
for the purpose of this Agreement, will mean the occurrence of any of the following events: 

        (a)  Performance
by Employee of any willful misconduct relating to the activities of the Company or the Parent, or commission by Employee of any illegal or fraudulent acts or
criminal conduct which in the opinion of the Parent's Board of Directors will have or is reasonably likely to have a material adverse effect on the profitability, reputation or goodwill of the company
or Parent; 

        (b)  A
conviction of or nolo contendere plea by Employee for any criminal acts involving moral turpitude having or reasonably
likely to have a material adverse effect upon the Company or the Parent, including, without limitation, upon their profitability, reputation or goodwill; 

        (c)  Willful
or grossly negligent failure by Employee to perform his duties in a manner consistent with the Company's or the Parent's best interests which he fails to cure
within thirty (30) days after receiving written notice thereof; 

        (d)  Willful
refusal by Employee to carry out reasonable instructions of the Company's or the Parent's Board of Directors not inconsistent with the provisions of this
Agreement which he fails to cure within thirty (30) days after receiving written notice thereof; 

        (e)  Employee's
failure to honor his obligations referred to in Section 2(b), which he fails to cure within thirty (30) days after receiving written notice
thereof; 

        (f)    Willful
violation by Employee's covenants and agreements contained in Sections 9, 10 or 11 of this Agreement; 

        (g)  Any
other material breach of Employee's obligations hereunder, which he fails to cure within thirty (30) days after receiving written notice thereof. 

        "Termination
without Cause" shall mean termination by Parent or the Company for a reason other than "Cause" and "Employee Termination Event" shall mean termination by Employee, as a
consequence of any of the following events, if such event occurs without Employee's prior consent: 

        (a)  Employee's
compensation is reduced or Parent fails to make available to Employee a performance bonus plan with a target bonus of at least 100% of Employee's base salary
based upon full achievement of the goals established by the plan; 

        (b)  Employee's
responsibilities, functions or duties as Executive Vice President Administration of the Company or the Parent are materially reduced; or 

        (c)  Employee's
title or reporting relationships change. 

        (d)  Employee
is forced to transfer his principal office or principal place of residence from the Atlanta area. 

        (e)  Employee
is asked to do an illegal or unlawful act. 

        A
"Change in Control" will be deemed to occur in the following events: 

	(i)
	The
acquisition in one or more transactions by any "Person" (as the term person is used for purposes of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), of "Beneficial Ownership" (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of a majority of the combined voting
power of the Parent's then outstanding voting securities (the "Voting Securities"), provided, however, that for purposes of this subsection (i), the Voting Securities acquired directly from the Parent
by any Person shall be 

3

 

excluded from the determination of such Person's Beneficial Ownership of Voting Securities (but such Voting Securities shall be included in the calculation of the total number of Voting Securities
then outstanding), and provided further, however, that for purposes of this subsection (i), Person shall in no event include Questor Partners Fund II, L.P., Thayer Equity Investors III, L.P., or any
of their affiliates; or 

	(ii)
	Approval
by stockholders of the Parent of (A) a merger or consolidation involving the Parent if the stockholders of the Parent immediately before
such merger or consolidation do not own, directly or indirectly immediately following such merger or consolidation, at least a majority of the combined voting power of the outstanding voting
securities of the corporation resulting from such merger or consolidation in substantially the same proportion as their ownership of the Voting Securities immediately before such merger or
consolidation or (B) a complete liquidation or dissolution of the Parent or an agreement for the sale or other disposition of all or substantially all of the assets of the Parent.

	(iii)
	A
sale or transfer of all, or substantially all, of the assets and business of the Company and the Parent to any entity or group of entities of which
the Company and/or Parent does not hold a controlling interest (i.e., more than 50% of the ownership interest in the entity or group of entities).

	(iii)
	Notwithstanding
the foregoing, a Change in Control shall not be deemed to occur solely because a majority or more of the then outstanding Voting
Securities is acquired by (i) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained by the Parent or any of its subsidiaries or (ii) any
corporation that, immediately prior to such acquisition, is owned directly or indirectly by the stockholders of the Parent in the same proportion as their ownership of stock in the Parent immediately
prior to such acquisition;

	(iv)
	Moreover,
notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any Person (the "Subject Person") acquired
Beneficial Ownership of more than the permitted amount of the outstanding Voting Securities as a result of the acquisition of Voting Securities by the Parent which, by reducing the number of Voting
Securities outstanding, increases the proportional number of shares Beneficially Owned by the Subject Person, provided that if a Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of Voting Securities by the Parent, and after such share acquisition by the Parent, the Subject Person becomes the Beneficial Owner of any additional Voting Securities
which increases the percentage of the then outstanding Voting Securities Beneficially Owned by the Subject Person, then a Change in Control shall occur. 

        9.    (a)
Non-Competition Agreement.    Employee understands that during the course of his employment by
the Company and the Parent, Employee will (i) have access to and receive the benefit of special training and unique information, including, but not limited to, inbound and outbound
telemarketing and customer care services, whether conducted by telephone or the internet, research, systems, development, marketing, management, business development, customer satisfaction methods and
techniques, business process improvements and other developments in marketing methods and providing services to customers, and (ii) represent the Company and the Parent and their affiliates and
develop contacts and relationships with other persons and entities on behalf of such entities, including but, not limited to, customers, potential customers and other employees of such entities. To
protect such entities' interest in this information and in these contacts and relationships, Employee agrees and covenants that during the term of his employment by the Company and the Parent, and for
a period of one year after the termination of such employment for any reason, without prior written approval of the Company and the Parent, Employee will not, in connection with any business that is
engaged in, or is about to be engaged in, by the Company or the Parent, which includes, but is not limited to, inbound 

4

 

and outbound telemarketing and customer care services, whether conducted by telephone or the internet, and the provision of market research services as currently provided by Elrick & Lavidge,
and the consulting, design and implementation of any of these services, including organization and investment in related industries or professions (the "Business"), directly or indirectly, either as
an individual or as an employee, partner, officer, director, shareholder, advisor, or consultant or in any other capacity whatsoever, of any person (other than ownership of less than 5% of the issued
and outstanding voting securities of a publicly held corporation conduct or assist others in conducting any business or activity that competes with the Business in the United States, its territories
or possessions. 

        (b)  Non-Hire Agreement.    Employee agrees that for a period of one year after the termination of such
employment for any reason, without prior written approval of the Company and the Parent, employee will not recruit, hire, assist others in recruiting or hiring, discuss employment with or refer to
others for employment any person who is or within the 12 month period immediately preceding the date of any such activity was an employee of the Company or the Parent or its subsidiaries or
affiliates. 

        It
is understood and agreed that the scope of the foregoing covenants is reasonable as to time, area and persons and is necessary to protect the legitimate business interests of the
Company, the Parent and their affiliates. It is further agreed that such covenants will be regarded as divisible and will be operative as to time, area and persons to the extent that it may be so
operative, and if any part of such covenant is declared invalid, unenforceable, or void as to time, area or persons, the validity and enforceability of the remainder will not be affected. 

        If
Employee violates the restrictive covenants of this Section 9 and the Company or the Parent brings legal action for injunctive or other relief, neither the Company nor the
Parent will be deprived of the benefit of the full period of the restrictive covenant, as a result of the time involved in obtaining the relief. Accordingly, Employee agrees that the restricted period
following the term of employment will have duration of one year, and the regularly scheduled expiration date of such covenant will be extended by the same amount of time that Employee is determined to
have violated such covenant. 

        10.  Confidentiality.    Employee acknowledges that Employee has learned and will learn Confidential Information (as
defined herein) relating to the business conducted and to be conducted by the Company, the Parent or their affiliates. Employee agrees that Employee will not, except in the normal and proper course of
his duties hereunder, disclose or use or authorize any third party to disclose or use any such Confidential Information, without prior written approval of the Company or the Parent. As used in this
Section 10, "Confidential Information" will mean information disclosed to or known to Employee as a direct or indirect consequence of or through his employment with the Company or the
Parent, about any customer's, supplier's or the Company's or the Parent's business, methods, business plans, operations, products, processes, and services, including, but not limited to, information
relating to research, development, inventions, recommendations, programs, systems, and systems analyses, flow charts, finances, and financial statements, marketing plans and strategies, merchandising,
pricing strategies, merchandise sources, client sources, system designs, procedure manuals, automated data programs, financing methods, financial projections, terms and conditions of arrangements of
any business, computer software, terms and conditions of business arrangements with clients or suppliers, reports, personnel procedures, supply and services resources, names and addresses of clients,
the Company's or the Parent's contacts, names of professional advisors, and all other information pertaining to clients and suppliers, including, but not limited to assets, business interests,
personal data and all other information pertaining to the Company or the Parent, clients or suppliers whatsoever, including all accompanying documentation therefore. All information disclosed to
Employee, or to which Employee has access during the period of his employment, which is treated by the Employer as Confidential Information, will be presumed to be Confidential Information hereunder.
Confidential Information will not, however, include information that (i) is publicly known or becomes publicly known through no fault of Employee, or (ii) is generally or readily
obtainable by the public, or 

5

 

(iii) constitutes general skills, knowledge and experience acquired by Employee before and/or during his employment with the Company and the Parent. 

        Employee
agrees that all documents of any nature pertaining to activities of the Company, the Parent or their affiliates, or that include any Confidential Information, in his possession
now or at any time during the term of his employment, including without limitation, memoranda, notebooks, notes, data sheets, records and computer programs, are and will be the property of such entity
and that all copies thereof will be surrendered to the appropriate entity upon termination of his employment. 

        11.  Inventions; Developments.    Employee agrees to notify the Company and the Parent of any discovery, invention,
innovation, or improvement which is related to the Business or to the business of any customer or supplier (collectively called "Developments") conceived or developed by Employee during the term of
the Employee's employment. Developments will include, without limitation, developments in computer software, logical systems, algorithms, and any or all other intellectual properties related to the
Business. All Developments, including but not limited to all written documents pertaining thereto, will be the exclusive property of the Company or the Parent, as the case may be, and will be
considered Confidential Information subject to the terms of this Agreement. Employee agrees that when appropriate, and upon written request of the Company or the Parent, as the case may be, the
Employee will acknowledge that Developments are "works for hire" and will file for patents or copyrights with regard to any or all Developments and will sign documentation necessary to evidence
ownership of Developments in the Company or the Parent, as the case may be. 

        12.  Exit Interview.    To insure a clear understanding of this Agreement, including, but not limited to, the
protection of the Company's and the Parent's business interests, Employee agrees, at no additional expense to the Company and the Parent, at a mutually acceptable time and place to engage in an exit
interview with the Company and the Parent prior to Employee's departure from the Company and the Parent. 

        13.  Right of Setoff.    The Company and the Parent will be entitled, at their option and not in lieu of any other
remedies to which they may be entitled, to set off any amounts due Employee or any affiliate of Employee against any amount due and payable by Employee or any affiliate of Employee to the Company and
the Parent ("Set-Offs") pursuant to this Agreement or otherwise, provided that the Set-Offs are set forth in detail in writing with supporting evidence to substantiate each
Set-Off and Employee has agreed that the Set-Offs are due and payable. 

        14.  Miscellaneous.

        (a)  Any
notice, demand or request required or permitted to be given or made under this Agreement will be in writing and will be deemed given or made when delivered in
person, when sent by United States registered or certified mail, or postage prepaid, or when telecopied to a party at its address or telecopy number specified below: 

        If
to the Parent or the Company: 

        Attn:
EVP Administration

        Aegis Communications Group, Inc.

        7880 Bent Branch Drive

        Suite 150

        Irving, Texas 75063

        Telecopy number: (972) 830-1804 

        With
a copy to: 

        Hughes &
Luce, L.L.P.

        1717 Main Street

        Suite 2800

        Dallas, Texas 75201

6

 

        Attn: Jim Hunter Birch

        Telecopy number: (214) 939-6100 

        If
to Employee: 

        Lee
O. Waters

        6965 Blackthorn Lane

        Suwanee, Georgia 30024 

        The
parties to this Agreement may change their addresses for notice in the manner provided above. 

        (b)  All
section titles and captions in this Agreement are for convenience only, will not be deemed part of this Agreement, and in no way will define, limit, extend or
describe the scope or intent of any provisions hereof. 

        (c)  Whenever
the context may require, any pronoun used in this Agreement will include the corresponding masculine, feminine or neuter forms, and the singular form of nouns,
pronouns and verbs will include the plural and vice versa. 

        (d)  The
parties will execute all documents, provide all information and take or refrain from taking all actions as may be reasonably necessary or appropriate to achieve the
purposes of this Agreement. 

        (e)  This
Agreement will be binding upon and inure to the benefit of the parties hereto, their representatives and permitted successors and assigns. Except for the provisions
of Sections 9, 10 and 11 of this Agreement, which are intended to benefit the Company's and the Parent's affiliates as third party beneficiaries, or as otherwise expressly provided in this Agreement,
nothing in this Agreement, express or implied, is intended to confer upon any person other than the parties to this Agreement, their respective representatives and permitted successors and assigns,
any rights, remedies or obligations under or by reason of this Agreement. 

        (f)    This
Agreement constitutes the entire agreement among the parties hereto pertaining to the specific subject matter hereof and supersedes all prior agreements and
understandings pertaining thereto. 

        (g)  None
of the provisions of this Agreement will be for the benefit of or enforceable by any creditors of the parties, except as otherwise expressly provided herein. 

        (h)  No
failure by any party to insist upon the strict performance of any covenant, duty, agreement or condition of this Agreement or to exercise any right or remedy
consequent upon a breach thereof will constitute waiver of any such breach or any other covenant, duty, agreement or condition. 

        (i)    This
Agreement may be executed in counterparts, all of which together will constitute one agreement binding on all the parties hereto, notwithstanding that all such
parties are not signatories to the original or the same counterpart. 

        (j)    THIS
AGREEMENT WILL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW. All claims,
disputes, and controversies arising out of or relating to this Agreement or the performance, breach, validity, interpretation, application or enforcement hereof, including any claims for equitable
relief or claims based on contract, tort, statute, or any alleged breach, default, or misrepresentation in connection with any of the provisions hereof, will be resolved by binding arbitration.
Provided, however, an aggrieved party may petition a federal or state court of competent jurisdiction in Dallas County, Texas for interim injunctive or other equitable relief to preserve the  status quo
until arbitration can be completed in the event of an alleged breach of Section 9, 10, or 11 of this agreement. A party may initiate
arbitration by sending written notice of its intention to arbitrate to the other party and to the American Arbitration Association ("AAA") office located in Dallas, Texas (the "Arbitration Notice").
The Arbitration Notice will contain a description of 

7

 

the dispute and the remedy sought. The arbitration will be conducted at the offices of the AAA in Dallas, Texas before an independent and impartial arbitrator who is selected by mutual agreement, or,
in the absence of such agreement, before three independent and impartial arbitrators, of whom each party will appoint one, with the third being chosen by the two appointed by the parties. In no event
may the demand for arbitration be made after the date when the institution of a legal or equitable proceeding based on such claim, dispute, or other matter in question would be barred by the
applicable statute of limitations. The arbitration and any discovery conducted in connection therewith will be conducted n accordance with the Commercial Rules of arbitration and procedures
established by AAA in effect at the time of the arbitration, including without limitation the expedited procedures set forth therein (the "AAA Rules"). The decision of the arbitrator(s) will be final
and binding on all parties and their successors and permitted assignees. The judgment upon the award rendered by the arbitrator(s) may be entered by any court having jurisdiction thereof. The
arbitrator(s) will be selected no later than 30 days after the date of the Arbitration Notice. The arbitration hearing will commence no later than 60 days after the arbitrator(s) is
selected. The arbitrator(s) will render a decision no later than 30 days after the close of the hearing, in accordance with AAA Rules. The arbitrator's fees and costs will conform to the then
current AAA fee schedule and will be borne equally by the parties. 

        (k)  If
any provision of this Agreement is declared or found to be illegal, unenforceable, or void, in whole or in part, then the parties will be relieved of all obligations
arising under such provision, but only to the extent that it is illegal, unenforceable or void, it being the intent and agreement of the parties that this Agreement will be deemed amended by modifying
such provision to the extent necessary to make it legal and enforceable while preserving its intent or, if that is not possible, by substituting therefore another provision that is legal and
enforceable and achieves the same objectives. 

        (l)    No
supplement, modification or amendment of this agreement or waiver of any provision of this Agreement will be binding unless executed in writing by all parties to this
Agreement. No waiver of any of the provisions of this Agreement will be deemed or will constitute a waiver of any other provision of this Agreement (regardless of whether similar), nor will any such
waiver constitute a continuing wavier unless otherwise expressly provided. 

        (m)  Employee
acknowledges and agrees that the Company and the Parent would be irreparably harmed by any violation of Employee's obligations under Sections 9, 10 and 11
hereof and that, in addition to all other rights or remedies available at law or in equity, the Company and the Parent will be entitled
to injunctive and other equitable relief to prevent or enjoin any such violation. The provisions of Sections 9, 10 and 11 hereof will survive any termination of this Agreement, in accordance with
their terms. 

        (n)  No
party may assign this Agreement or any rights or benefits hereunder without the written consent of the other parties to this Agreement. 

8

 

        EXECUTED
as of 8 January 2002. 

	 	 	AEGIS COMMUNICATIONS GROUP, INC.
	

 	
 	

By:	
 	

 Herman M. Schwarz

President and Chief Executive Officer
	

 	
 	

ADVANCED TELEMARKETING CORPORATION
	

 	
 	

By:	
 	

 Herman M. Schwarz

President and Chief Executive Officer
	

 	
 	

IQI, INC.
	

 	
 	

By:	
 	

 Herman M. Schwarz

President and Chief Executive Officer
	

 	
 	

By:	
 	

 Lee O. Waters

EVP Client/Market Development

9

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EMPLOYMENT AGREEMENT

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