Document:

EX-10.2

Exhibit 10.2

CONSULTING AGREEMENT

This Consulting Agreement (“Agreement”), dated this 13th day of August, 2007, is by and
between Hypercom U.S.A., Inc., located at 2851 West Kathleen Road, Phoenix, Arizona 85053
(“Hypercom”) and O.B. Rawls IV (“Consultant”) whereby Hypercom hereby retains Consultant to furnish
services pursuant to the terms and conditions set forth below.

1. Term. This Agreement shall be effective as of the date first written above and shall
continue in effect through November 9, 2007 or, as mutually agreed by the parties, for the duration
of any specific statement of work (“SOW”) issued by Hypercom that is hereby incorporated by
reference and made an integral part of this Agreement (“Term”).

2. Services. Consultant hereby agrees to perform the services described herein or in the
relevant SOW issued by Hypercom (“Services”). All Services shall be performed to Hypercom’s
satisfaction. In the event any Services are not performed to Hypercom’s reasonable satisfaction,
Consultant agrees to promptly perform the Services to Hypercom’s reasonable satisfaction at no
additional cost to Hypercom. All Services must be performed by Consultant without the right to use
subcontractors or any other third party without the prior written consent of Hypercom. In the
event Hypercom consents, in its sole and absolute discretion, to the use of any person or entity to
assist Consultant with Services: (a) such person or entity shall agree to be bound by the terms of
Hypercom’s standard non-disclosure agreement prior to the performance of any Services; and (b)
Consultant will remove and/or replace any such person or entity immediately upon Hypercom’s request
for any reason whatsoever. Consultant shall perform all Services under the supervision of and
shall report directly to the following “Project Supervisor(s)”: Philippe Tartavull.

3. Invoices and Fees. The fees are described in the relevant SOW (“Fees”). Consultant
agrees to deliver an invoice to the Project Supervisor within ten (10) days after the last day of
each month during the Term or as otherwise directed by the Project Supervisor. Each invoice must
contain a description of: (a) the Fees earned; (b) the hours worked during the relevant monthly
period; (c) Services performed, including a progress report and the percent of completion (if
applicable); and (d) any travel and related expenses for which reimbursement is permitted
hereunder. Hypercom shall pay Consultant within thirty (30) days of receiving a correct and
undisputed invoice from Consultant for Services performed during the preceding month. In addition
to the Fees, Hypercom will reimburse Consultant for Project Supervisor pre-approved travel and
related expenses that comply with Hypercom’s standard corporate policies. All taxes, dues, fees,
duties and charges imposed on Consultant in connection with the Services and the compensation
therefor shall be borne by Consultant, and all payments are subject to applicable withholding
requirements. Further, as of the date first written above, Hypercom will pay for three (3) months
of COBRA health coverage for Consultant.

4. Independent Contractor Status. It is expressly agreed and understood that Consultant
will be performing Services under this Agreement as an independent contractor for Hypercom.
Nothing contained herein shall be construed as creating any agency, employment relationship,
partnership, principal-agent or other form of joint enterprise between the parties. Consultant
shall not represent it, its employees, representatives, or subcontractors as agents, employees,
partners or joint venturers of Hypercom, and may not obligate Hypercom or otherwise cause Hypercom
to be liable under any contract or agreement express or implied.

5. Limitation of Liability. Hypercom’s entire aggregate liability hereunder shall be
limited to payment to Consultant of the Fees paid pursuant to this Agreement. All liability to any
other person providing Services under this Agreement or related to providing such Services,
including but not limited to, payment of wages or other compensation, withholding and payment of
taxes and similar charges related to such wages or other compensation, and Worker’s Compensation,
shall be Consultant’s sole responsibility. The foregoing sentence shall not imply the right for
Consultant to use any other person or entity in the performance of Services. IN NO EVENT SHALL
EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY LOSS OF USE, INTERRUPTION OF BUSINESS, OR ANY
INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, OR CONSEQUENTIAL DAMAGES OF ANY KIND (INCLUDING LOST
PROFITS) REGARDLESS OF THE FORM OF ACTION WHETHER IN CONTRACT, TORT, (INCLUDING NEGLIGENCE), STRICT
PRODUCT LIABILITY, OR OTHERWISE, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.

6. Indemnification. Consultant shall assume liability for any losses and damages suffered
by Hypercom arising out of or related to Services, and will defend and hold Hypercom harmless from
any claims or demands that may be asserted against Hypercom except to the extent that such claim,
loss, or damage was caused by the gross negligence or willful misconduct of Hypercom, its agents or
employees.

7. Assignment of Developments. In consideration of Consultant’s work in any capacity for
Hypercom and of the Fees paid for such Services, the parties agree as follows:

a. Consultant will promptly and fully communicate to Hypercom all inventions, discoveries,
concepts, and ideas whether or not patentable or copyrightable, including but not limited to,
hardware and apparatus, processes and methods, formulas, designs, computer programs and techniques,
as well as improvements thereof and knowledge related thereto, (hereinafter collectively referred
to as “Developments”) conceived or completed, or reduced to practice (whether solely by Consultant
or jointly with others) during the term of the Agreement and within one (1) year after the end of
its association with Hypercom that: (i) are related to work Consultant performs with regard to the
present or prospective business, work, research, developments or investigations of Hypercom; (ii)
result from any work Consultant performs with the use of any equipment, facilities, materials or
personnel of Hypercom; (iii) result from or are suggested or inspired by any work that Consultant
may do for or on behalf of Hypercom; or (iv) result directly from Consultant’s access to any of
Hypercom’s memoranda, notes, records, drawings, sketches, models, customer lists, research or
laboratory results, data, formulae, specifications, inventions, processes, equipment or the like
(collectively referred to as “Hypercom Materials”).

b. Consultant will assign, and does hereby assign, to Hypercom or Hypercom’s designee, Consultant’s
entire right, title and interest to all such Developments and all copyrights, trade secrets rights
and mask work rights in such Developments and any patent applications filed and patents granted
thereon including, but not limited to, those in foreign countries and, both during Consultant’s
work with Hypercom and thereafter, to execute any patent papers covering such Developments as well
as any papers that Hypercom may consider necessary or helpful in obtaining or maintaining
Hypercom’s ownership rights in said Developments in order to secure for Hypercom patent, copyright
or other protection.

c. Consultant shall retain all right, title and interest, in and to any various pre-existing
development tools, routines, subroutines, libraries, algorithms, software engines, source code,
object code, and other programs, data and materials, and any modifications, enhancements or
derivative works thereto, and all applicable intellectual property rights therein, including
without limitation, copyrights, patents, trade secrets, trademarks and moral rights, used by
Consultant in performing the Services and portions of which may be incorporated into the
Developments (“Background Technology”). Consultant agrees to list any Background Technology and any
applicable third-party licenses to be used for any Services in an applicable SOW or Exhibit. To
the extent it lawfully may, Consultant hereby grants to Hypercom a nonexclusive, perpetual,
irrevocable, worldwide, fully paid license, with the right to sublicense, to make, have made, sell,
offer to sell, import, use, modify, create derivative works, perform, display, execute, distribute
(including through multiple tiers) and reproduce the Background Technology solely as incorporated
into the Developments.

8. Assignment of Copyright Materials. All original materials Consultant may develop
(alone or jointly with others) under this Agreement, including but not limited to, computer
programs, listings, design specifications, flow charts and documentation are to be considered
“works made for hire” under the United States copyright laws and are the sole and exclusive
property of Hypercom. In the event any of the developed materials are determined by a court of
competent jurisdiction not to be “works made for hire” under the United States copyright laws, this
Agreement shall operate as an irrevocable assignment by Consultant to Hypercom of the copyright in
the developed materials including all rights thereunder.

9. Conflicts. Consultant acknowledges that there are no currently existing ideas,
processes, inventions, discoveries, marketing or business ideas or improvements that Consultant
desires to exclude from the operation of this Agreement except as set forth in Exhibit A attached
hereto. The absence of an Exhibit A herefrom constitutes Consultant’s representation that no such
exclusions exist. To the best of Consultant’s knowledge, there is no other contract to assign
inventions, trademarks or service marks, ideas, processes, or discoveries that is now in existence
between Consultant and any other person (including any business or governmental entity) except as
set forth in Exhibit B attached hereto. The absence of an Exhibit B herefrom constitutes
Consultant’s representation that no such contracts or obligations exist.

10. Confidentiality Obligations of Consultant. Consultant acknowledges that in rendering
Services to Hypercom, Consultant will receive information that Hypercom regards as confidential
(“Confidential Information”). Confidential Information incorporates information or material that
is not generally available to or used by others, or the utility or value of which is not generally
known or recognized as standard practice, whether or not the underlying details are in the public
domain, including: (a) information or material that relates to inventions, technological
developments, “know-how,” purchasing, accounting, merchandising, or licensing; (b) trade secrets as
defined in the Restatement of Torts; (c) software in various stages of development (source code,
object code, documentation, diagrams, flow charts), designs, drawings, specifications, models,
data, and customer information; and (d) any information of the type described above that Hypercom
treats as proprietary or designates as confidential, whether or not owned or developed by Hypercom.
Consultant agrees to receive and hold Confidential Information and information relating to
Hypercom rights in Developments in confidence (whether or not conceived, originated, discovered or
developed in whole or part by Consultant) and with no less than a commercially reasonable degree of
care, to not disclose Confidential Information to any person or entity not a party to this
Agreement, and to not use any Confidential Information for the benefit of Consultant or any third
party. Consultant agrees to pay any and all damages (including attorney’s fees) sustained by
Hypercom due to the unauthorized disclosure or use of any Confidential Information or information
relating to Hypercom rights in Developments by Consultant. Consultant’s obligations under this
Section 10 shall continue with respect to each item of Confidential Information and each item of
information relating to Hypercom rights in Developments until Hypercom publishes said item or until
said item becomes public and acknowledged by Hypercom by a means other than a breach of this
Agreement by Consultant. This Section is not intended to replace or supersede any non-disclosure
or confidentiality agreement between Hypercom and Consultant concerning treatment of confidential
information, but rather, is intended to be an addition or supplement to any such agreement that may
already exist between the parties.

11. Non-Solicitation. To protect Hypercom rights in Confidential Information and any
other proprietary property of Hypercom, Consultant agrees not to directly or indirectly encourage
nor seek to influence any employee of Hypercom to quit or leave Hypercom’s employment nor to
commence employment with Consultant or any third party during the Term and for an additional one
(1) year following termination or expiration thereof.

12. Equitable Relief. Consultant hereby acknowledges that a breach by Consultant of any
of the provisions of this Agreement relating to Confidential Information, Hypercom proprietary
information, or non-solicitation will cause Hypercom irreparable injury and damage for which
remedies at law would be inadequate. Therefore, Consultant hereby agrees that Hypercom shall be
entitled to seek injunctive and/or other equitable relief to prevent a breach or threatened breach
of this Agreement, or any part of it, and to secure its performance.

13. Termination.

a. This Agreement may be terminated: (i) immediately upon any attempt by Consultant to assign,
delegate, sublicense, or otherwise transfer this Agreement or its rights, except as provided for
herein; (ii) immediately upon any breach by Consultant of any confidentiality or proprietary
information provisions of this Agreement, including but not limited to, Consultant’s attempt to
reverse engineer, decompile, disassemble, decrypt, modify or make unauthorized copies of any
Hypercom intellectual property; (iii) upon seven (7) days prior written notice for Consultant’s
failure to perform the Services in a satisfactory manner, in Hypercom’s sole and absolute
discretion; or (iv) immediately if Consultant terminates or suspends its business, files a petition
for bankruptcy or is subject to an involuntary insolvency proceeding, makes an assignment for the
benefit of its creditors, or a trustee, receiver or similar authority is appointed for Consultant’s
business or to take control of a majority of Consultant’s assets. All SOWs will terminate
immediately upon termination of this Agreement.

b. Upon termination or expiration of this Agreement, Consultant shall promptly: (i) furnish to
Hypercom a report summarizing the Services completed and the status of any work in progress; and
(ii) comply with any provisions of this Agreement regarding the return of Confidential Information,
Developments, and Hypercom Materials. Upon Consultant’s full compliance with (b)(i) and (b)(ii)
above, Consultant shall be paid for all Services rendered up until and related Fees owed as of the
effective date of termination, in accordance with this Agreement.

14. Return of Materials. Consultant shall deliver to Hypercom promptly upon request, or
on the date of termination of work, any and all records, documents, copies thereof and any other
Hypercom Materials in Consultant’s possession pertaining to Hypercom’s business, including, but not
limited to, equipment, Confidential Information or Developments. Consultant shall continue
thereafter to promptly return to Hypercom any of the above mentioned materials and all copies
thereof pertaining to Hypercom’s business or originating with Hypercom that come into Consultant’s
possession.

15. Improper Payments. Consultant represents and warrants that it has not agreed to, nor
will it, make any offer, payment, promise to pay or authorization of the payment of any money, or
any offer, gift, promise to give, or authorization of the giving of anything of value, to any (a)
to any director, officer, employee, agent or other representative of the Company in connection with
this Agreement, nor has any such payment or agreement for payment been requested or solicited by
any such director, officer, employee, agent or other representative; or (b) official, any political
party or official thereof or any candidate for political office, or any other person to influence
or reward action or inaction respecting this Agreement or to seek an improper advantage (“Improper
Payments”). Consultant further represents and warrants its employees, agents or authorized
representatives have not made any such Improper Payments. Consultant hereby acknowledges that it
understands that any Improper Payments would violate the Company’s firm and undeviating policy, and
that this representation and warranty constitutes a material inducement upon which the Company is
relying in entering into and performing this Agreement.

16. Representation and Warranties.

a. Quality of Services. Consultant represents and warrants that the Services shall at all
times: (i) be of merchantable quality, of good material and workmanship, and free of defect in
design, material, or workmanship (and with respect to services, performed in a professional and
workmanlike manner); (ii) conform in all respects to the warranties set forth in this Agreement;
and (iii) be fit for the purposes for which Services of that type are ordinarily used. In the
event that Consultant is in breach of the warranties in this Section, it shall, within ten (10)
business days after Hypercom’s notice of breach: (A) redeliver or re-perform the Services or the
non-conforming items, at Consultant’s own expense: or (B) if (A) is not practicable as determined
by the parties in their reasonable discretion, refund the entire purchase price, plus shipping and
other charges.

b. Requisite Authority. Both parties have the necessary authority to enter into this
Agreement and is not subject to any agreement or other constraint that would prohibit or restrict
the other party’s right or ability to enter into, or carry out, its obligations hereunder.

c. Time is of the Essence. Time is of the essence in connection with consultant’s
performance and delivery of the Services and other deliverables and such performance will be made
in accordance with any applicable performance delivery schedules in a SOW.

d. Third-Party Rights. Consultant’s performance of the Services does not violate any
third-party rights in any patent, trademark, copyright, trade secret, or similar intellectual
property right.

17. General Provisions.

a. Entire Agreement. Any SOW or Exhibit(s) attached hereto, along with any applicable
non-disclosure agreement, are hereby incorporated into and form a part of this Agreement. This
Agreement constitutes the entire agreement between Hypercom and Consultant with respect to the
subject matter of this Agreement, superseding all drafts, all prior or contemporaneous agreements,
and all promises or representations, written or oral. To the extent the terms and conditions of
this Agreement conflict with the terms and conditions of an applicable SOW or Exhibit, the terms
and conditions of this Agreement shall control. Each party agrees that use of pre-printed forms,
such as invoices, purchase orders or acknowledgements, is for convenience only and all terms and
conditions stated thereon are void and of no effect. In a legal action brought to enforce or
interpret this Agreement, the prevailing party shall be entitled to recover from the other all
costs and reasonable attorneys’ fees so incurred. Those provisions of this Agreement that, by
their nature, are meant to survive any termination of this Agreement will so survive.
Notwithstanding the foregoing, the Consultant acknowledges and agrees that this Agreement does not,
under any circumstances, amend, modify or otherwise act as a waiver of any Consultant obligations
as a former Hypercom employee or of any agreements Consultant executed with Hypercom associated
with such employment or termination thereof. Further, Consultant acknowledges and agrees that
Hypercom has entered into this Agreement in consideration of Consultant’s waiver and release of any
and all claims of any kind Consultant may have as a result of Consultant’s employment with
Hypercom.

b. Captions. The section captions in this Agreement are for convenience of reference only,
and shall not affect the interpretation of the body of the contract.

c. Modification. This Agreement may be modified only by written instrument signed by an
authorized representative of the party against which enforcement is sought, that makes reference to
the specific section it purports to amend. Any party’s standard form that purports to govern
acquisition of Services ordered pursuant to this Agreement shall be ineffective to modify this
Agreement and shall not be binding upon either party to the extent it is inconsistent with this
Agreement.

d. Waiver. The non-enforcement of any provision of this Agreement, or failure to insist on
strict compliance with any of the terms, covenants or conditions hereof, shall not be deemed a
waiver of any right granted under this Agreement; nor shall any waiver of any right granted
hereunder on one occasion be deemed a waiver at any other time.

e. Severability. In the event that any clause of this Agreement is found by a court
validly asserting jurisdiction to be unenforceable, that clause will be considered void to the
extent it is contrary to the applicable law, but such a finding shall not affect the validity of
any other clause of the Agreement, and the rest of the Agreement shall remain in full force and
effect.

f. Governing Law. This Agreement shall be governed by the laws of the State of Arizona
without regards to its conflicts of laws principles. Notwithstanding the preceding sentence,
Hypercom may bring an action in any jurisdiction or forum provided such action is solely to enjoin
the actual or anticipated wrongful disclosure of any Confidential Information, and the jurisdiction
and forum is that in which the wrongful disclosure has or is anticipated to occur.

g. Third-Party Beneficiaries. This Agreement inures to the benefit of Hypercom’s
affiliates, subsidiaries, and successors-in-interest, all of which shall have the right to issue
SOWs and receive Services under the same terms and conditions as Hypercom; submission of an SOW
referring to this Agreement shall constitute a binding agreement by such Hypercom affiliate.

h. Notices. Every notice required or contemplated by this Agreement shall be in writing.
Notices shall be deemed received (i) when delivered personally; (ii) when sent by confirmed
facsimile (followed by the actual document in air mail/air courier); or (iii) one (1) business day
after deposit with a commercial express courier specifying next day delivery (or, for international
courier packages, two (2) business days after deposit with a commercial express courier specifying
two-day delivery) with written verification of receipt. All notices will be sent to the addresses
set forth in this Agreement or to such other address as may be designated by written notice.

i. Notice of Labor Disputes. Whenever an actual or potential labor dispute is delaying or
threatens to delay any timely performance of a SOW, Consultant shall immediately give notice
thereof to Hypercom. Such notice shall include all relevant information with respect to such
dispute.

j. Records and Audit. For any Services purchased under this Agreement, Consultant shall
maintain complete and accurate books and records of the amounts charged to Hypercom in connection
with such items. Consultant shall retain such records for two (2) years after delivery of such
items and shall make such records available to Hypercom or its third-party auditor, during normal
business hours upon reasonable advance written notice.

k. Execution by Counterparts. This Agreement may be executed by facsimile and in one or
more counterparts, each of which shall be deemed an original and all of which shall constitute one
and the same Agreement.

IN WITNESS WHEREOF, the parties duly authorized representatives have executed this Agreement as of
the date first written above.

	 	 	 	 	 	 	 
	O.B. Rawls IV
	 	Hypercom U.S.A., Inc.
	By:

	 	/s/ O.B. Rawls IV
	 	By:
	 	/s/ William Keiper
	
 
	 	 
	 	 	 	 

Name: William Keiper

Title: CEOFiled by Bowne Pure Compliance

 

Exhibit 10.9

APAC Customer Services, Inc.

Management Incentive Plan

As Amended and Restated

Effective August 2, 2007

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	SECTION 1	 	ESTABLISHMENT OF THE PLAN
	 	 	1	 
	 	1.1  	 	 	Purpose
	 	 	1	 
	 	1.2  	 	 	Term
	 	 	1	 
	SECTION 2	 	DEFINITIONS
	 	 	1	 
	 	2.1  	 	 	Incentive Award
	 	 	1	 
	 	2.2  	 	 	Award
	 	 	1	 
	 	2.3  	 	 	Award Agreement
	 	 	1	 
	 	2.4  	 	 	Base Salary
	 	 	1	 
	 	2.5  	 	 	Board
	 	 	1	 
	 	2.6  	 	 	Change in Control
	 	 	1	 
	 	2.7  	 	 	Code
	 	 	2	 
	 	2.8  	 	 	Committee
	 	 	2	 
	 	2.9  	 	 	Company
	 	 	2	 
	 	2.10	 	 	Eligible Individual
	 	 	2	 
	 	2.11	 	 	Fair Market Value
	 	 	2	 
	 	2.12	 	 	Long-Term Incentive Award
	 	 	2	 
	 	2.13	 	 	Participant
	 	 	3	 
	 	2.14	 	 	Performance Goals
	 	 	3	 
	 	2.15	 	 	Performance Period
	 	 	3	 
	 	2.16	 	 	Plan
	 	 	3	 
	 	2.17	 	 	Plan Year
	 	 	3	 
	 	2.18	 	 	Stock
	 	 	3	 
	 	2.19	 	 	Stock Plan
	 	 	3	 
	SECTION 3	 	ELIGIBILITY AND PARTICIPATION
	 	 	3	 
	 	3.1  	 	 	General
	 	 	3	 
	 	3.2  	 	 	Partial Performance Period Participation
	 	 	3	 
	 	3.3  	 	 	No Right to Participate
	 	 	3	 
	SECTION 4	 	INCENTIVE AWARD OPPORTUNITY
	 	 	4	 
	 	4.1  	 	 	Performance Goals
	 	 	4	 
	 	4.2  	 	 	Awards
	 	 	4	 
	 	4.3  	 	 	Maximum Award
	 	 	4	 
	SECTION 5	 	PAYMENT OF INCENTIVE AWARDS
	 	 	5	 
	 	5.1  	 	 	Form and Timing of Payment
	 	 	5	 
	 	5.2  	 	 	Payment of Partial Awards
	 	 	5	 
	 	5.3  	 	 	Termination of Employment
	 	 	5	 
	 	5.4  	 	 	Change in Control Termination
	 	 	5	 

 

 

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	SECTION 6	 	RIGHTS OF PARTICIPANTS
	 	 	5	 
	 	6.1  	 	 	No Employment Rights
	 	 	5	 
	 	6.2  	 	 	Nontransferability
	 	 	6	 
	SECTION 7	 	ADMINISTRATION, LIABILITY, INDEMNIFICATION
	 	 	6	 
	 	7.1  	 	 	Administration
	 	 	6	 
	 	7.2  	 	 	Liability; Indemnification
	 	 	7	 
	SECTION 8	 	AMENDMENT, MODIFICATION AND TERMINATION
	 	 	7	 
	SECTION 9	 	MISCELLANEOUS
	 	 	7	 
	 	9.1  	 	 	Governing Law
	 	 	7	 
	 	9.2  	 	 	Withholding Taxes
	 	 	7	 
	 	9.3  	 	 	Shareholder Approval
	 	 	7	 
	 	9.4  	 	 	Costs of the Plan
	 	 	7	 
	 	9.5  	 	 	Unsecured General Creditor
	 	 	7	 
	 	9.6  	 	 	Entire Agreement
	 	 	7	 
	 	9.7  	 	 	Limitations of Liability
	 	 	8	 
	 	9.8  	 	 	Successors
	 	 	8	 
	 	9.9  	 	 	Captions, Gender and Number
	 	 	8	 
	 	9.10	 	 	Headings
	 	 	8	 
	 	9.11	 	 	Severability
	 	 	8	 

 

ii

 

APAC Customer Services, Inc.

Management Incentive Plan

(As Amended and Restated Effective August 2, 2007)

Section 1

ESTABLISHMENT OF THE PLAN

1.1 Purpose. APAC Customer Services, Inc. initially established the APAC Customer
Services, Inc. Management Incentive Plan effective as of January 3, 2000, subsequently amended and
restated the Plan effective January 3, 2005 and further amends the Plan by this restatement, to
reward certain eligible employees of the Company who help achieve certain performance goals of the
Company and, in some cases, specified individual goals.

1.2 Term. The Company hereby amends and restates the Plan, as set forth herein, effective
August 2, 2007. The Plan shall terminate on the 10th anniversary of the effective date
(unless sooner terminated by the Board pursuant to Section 9).

Section 2

DEFINITIONS

2.1 Incentive Award. “Incentive Award” means the actual bonus earned during a Plan
Performance Period by a Participant, payable to the Participant in cash or Stock having a Fair
Market Value equal to such earned bonus amount, as determined by the Committee at or after the end
of a Performance Period. A Participant’s Incentive Award may, in the discretion of the Committee,
be stated as a percentage of the Participant’s Base Salary, a dollar amount or other measurement.

2.2 Award. “Award” means an Incentive Award or a Long-Term Incentive Award. “Awards” means
two or more Incentive Awards, Long-Term Incentive Awards or a combination thereof.

2.3 Award Agreement. “Award Agreement” means a written communication from the Company to the
Participant that establishes the terms, conditions and restrictions applicable to an Award in
addition to those established by the Plan and by the Committee’s exercise of its administrative
powers.

2.4 Base Salary. “Base Salary” means the base pay rate in effect at the end of the
Performance Period.

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

2.6 Change in Control. “Change in Control” means any of the following events:

(a) A tender offer shall be made and consummated for the ownership of more than 50% of the
outstanding voting securities of the Employer;

(b) The Employer shall be merged or consolidated with another corporation and as a result of
such merger or consolidation less than 50% of the outstanding voting securities of the surviving or
resulting corporation shall be owned in the aggregate by the former shareholders of the Employer,
as the same shall have existed immediately prior to such merger or consolidation;

(c) The Employer shall sell all or substantially all of its assets to another corporation
which is not a wholly-owned subsidiary or affiliate;

 

1

 

(d) As the result of, or in connection with, any contested election for the Board of Directors
of the Employer, or any tender or exchange offer, merger or business combination or sale of assets,
or any combination of the foregoing (a “Transaction”), the persons who were Directors of the
Employer before the Transaction shall cease to constitute a majority of the Board of Directors of
the Employer, or any successor thereto; or

(e) A person, within the meaning of Section 3(a)(9) or of Section 13(d)(3) (as in effect on
the date hereof) of the Securities and Exchange Act of 1934 (“Exchange Act”), other than any
employee benefit plan then maintained by the Employer, shall acquire more than 50% of the
outstanding voting securities of the Employer (whether, directly, indirectly, beneficially or of
record). For purposes hereof, ownership of voting securities shall take into account and shall
include ownership as determined by applying the provisions of Rule 13d-3(d)(1)(i) (as in effect on
the date hereof) pursuant to the Exchange Act.

Notwithstanding the foregoing, (i) a Change in Control will not occur for purposes of this
Agreement merely due to the death of Theodore G. Schwartz, or as a result of the acquisition by
Theodore G. Schwartz, alone or with one or more affiliates or associates, as defined in the
Exchange 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 of
family members (collectively, the “Schwartz Entities") do not control, directly or indirectly, at
least twenty-seven percent (27%) of the resulting entity, and (ii) if the Schwartz Entities
control, directly or indirectly, less than twenty-seven (27%) percent of the Employer’s voting
securities while it is a public company, then “331/ 3 %” shall be substituted
for “50%” in clauses (a) and (e) of this Section 2.5, and “662/ 3 %” shall be
substituted for “50%” in clause (b) of this Section 2.5.

2.7 Code. “Code” means the Internal Revenue Code of 1986, as amended. References to a Section
of the Code shall include references to any temporary or final regulation related to such Section
or any successor to such Section or regulation.

2.8 Committee. “Committee” means the Compensation Committee of the Board designated to
administer the Plan in accordance with Section 8. Unless the Board determines otherwise, and such
determination is reduced to a writing articulating the reasons for such determination, the
Committee shall be comprised solely of not less than 2 members, each of whom shall qualify as: (a)
a “Non-Employee Director” within the meaning of Rule 16b-3(b)(3) (or any successor rule) under the
Exchange Act, (b) an “outside director” within the meaning of Section 162(m) of the Code (or any
successor law or regulation), and (c) an “independent director” as such term is defined or used by
the rules of the exchange or system on which the Company’s Stock is listed.

2.9 Company. “Company” means APAC Customer Services, Inc., an Illinois corporation, and any
successor thereto.

2.10 Eligible Individual. “Eligible Individual” means one of the employees of the Company
designated as such by the Committee.

2.11 Fair Market Value. “Fair Market Value” means (a) if Stock is readily tradeable on a
national securities exchange or other market system, the closing price of Stock on the date of
calculation (or on the last preceding trading date if Stock was not traded on such date), or (b) if
Stock is not then readily tradeable on a national securities exchange or other market system (i)
the book value of a share of Stock as of the last day of the last completed fiscal quarter
preceding the date of calculation; or (ii) any other value as otherwise determined in good faith by
the Board.

2.12 Long-Term Incentive Award. “Long-Term Incentive Award” means the actual long-term
incentive award earned during a Performance Period of two or more Plan Years by a Participant,
payable in cash or Stock having a Fair Market Value equal to such earned award amount, as
determined by the Committee at or after the end of the Performance Period. may, in
the discretion of the Committee, be stated as a percentage of the Participant’s Base Salary, a
dollar amount or other measurement.

 

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2.13 Participant. “Participant” means an Eligible Individual who has been designated as
eligible to participate under Section 3.

2.14 Performance Goals. “Performance Goals” means the criteria established by the Committee
pursuant to Section 4, which shall be used to determine whether a Participant is entitled to an
Incentive Award or a Long-Term Incentive Award and the amount of such Award.

2.15 Performance Period. “Performance Period” refers to the period for measuring the
achievement of Performance Goals under an Incentive Award or Long-Term Incentive Award.
Performance periods may range from one month to five years.

2.16 Plan. “Plan” means this APAC Customer Services, Inc. Management Incentive Plan, as set
forth herein, and amended from time to time.

2.17 Plan Year. “Plan Year” means the Company’s fiscal year.

2.18 Stock. “Stock” means one or more shares of the common stock, $0.01 par value per share,
of the Company.

2.19 Stock Plan. “Stock Incentive Plan” means the 2005 Incentive Stock Plan of the Company,
as may be in effect from time to time, and any successor plan thereto.

Section 3

ELIGIBILITY AND PARTICIPATION

3.1 General. The Committee, in its discretion, shall designate the Eligible Individuals
who are eligible to participate in the Plan for each Performance Period. Eligible Individuals who
are eligible to participate in the Plan shall be so notified in writing, and shall be apprised of
the Performance Goals and related Award opportunities for the applicable Performance Period.

3.2 Partial Performance Period Participation. In the event that an Eligible Individual
becomes eligible to participate in the Plan subsequent to the commencement of a Performance Period
(either because he or she first becomes an Eligible Individual or because he or she is designated
as eligible to participate after the commencement of the Performance Period), then such
individual’s Award shall be determined using the amount of the Award that would be payable for the
full Performance Period (but for the Participant’s participation for a partial year) multiplied by
a fraction, the numerator of which is the number of days in such Performance Period that the
Participant was eligible to participate in the Plan and the denominator of which is the total
number of days comprising the Performance Period.

3.3 No Right to Participate. No Participant, Eligible Individual or other employee of the
Company shall at any time have the right to be selected for participation in the Plan for any
Performance Period, despite having previously participated in this Plan or another incentive plan
of the Company.

 

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Section 4

INCENTIVE AWARD OPPORTUNITY

4.1 Performance Goals.

(a) Performance Goals. Prior to the beginning of a Performance Period, or as soon as
practicable thereafter but not later than 90 days after commencement of the
Performance Period, the Committee, in its discretion, and subject to the approval of the
Board, shall in writing establish objective Performance Goals for Eligible Individuals. For the
Performance Goals so established, the Committee shall establish individual or aggregate threshold,
target and maximum levels of performance necessary to achieve and to earn all or a portion of an
Award. The Performance Goals may be based upon both financial and non-financial goals, including,
but not limited to, (i) earnings before interest, taxes, depreciation and amortization, (ii)
revenue, (iii) sales, (iv) earnings per share, (v) funds from operations, (vi) pretax income before
allocation of corporate overhead and bonus, (vii) budget, (viii) cash flow, (ix) net income, (x)
division, group or corporate financial goals, (xi) appreciation in or maintenance of the price of
the Stock or any other publicly traded securities of the Company, (xii) dividends, (xiii) total
shareholder return, (xiv) return on shareholders’ equity, (xv) return on assets, (xvi) return on
investment, (xvii) internal rate of return, (xviii) attainment of strategic and operational
initiatives, (xix) market share, (xx) operating margin, (xxi) profit margin, (xxii) gross profits,
(xxiii) earnings before interest and taxes, (xxiv) economic value-added models, (xxv)comparisons
with various stock market indices, (xxvi) increase in number of customers, and (xxvii) reductions
in costs, as determined by the Committee.

(b) Individual Performance Goals. If the Committee determines that the Award shall be
attributable, in part, to a Participant’s achievement of individual Performance Goals, such
achievement shall be determined by the Committee after consulting the person to whom the
Participant directly reports.

(c) Adjustment of Performance Goals. For any Award subject to Section 162(m) of the Code, the
Committee shall not have the authority to increase the Award opportunities during a Performance
Period, but shall have authority to exercise negative discretion provided that such exercise does
not result in an increase in the Award of another Participant. For any other Award, the Committee
shall have the right to increase or to decrease the Performance Goals and the Award opportunities
if it determines that external changes or other unanticipated business conditions have materially
affected the fairness of the Performance Goals and have unduly influenced the ability to achieve
the Performance Goals.

4.2 Awards. The Committee shall have the authority, in its sole discretion, to grant
Incentive Awards and Long-Term Incentive Awards to Participants, and to establish the terms and
conditions of such Awards, including payout, tax withholding and restrictive covenants, and, in the
case of any payout in Stock, vesting and other restrictions, the effects of the termination of a
Participant’s employment or service and transferability, in each case in accordance with the terms
of the Stock Plan. Each Award granted under the Plan shall be evidenced by an Award Agreement
which shall be signed by the Committee or its designee; provided, however, that in the event of any
conflict between a provision of the Plan and any provision of an Award Agreement, the provision of
the Plan shall prevail. Incentive Awards or Long-Term Incentive Awards based on percentage
achievement of Performance Goals between the threshold, target and maximum levels shall be
determined by interpolation in accordance with procedures established by the Committee.

4.3 Maximum Award. The maximum dollar amount of any Incentive Award and of any Long-Term
Incentive Award that may be paid to any single Participant in any calendar year with respect to
Awards the compensation of which is determined by a formula that calculates a dollar amount
(whether payable in cash or property) is (a) the greater of $1,000,000 or 250% of the Participant’s
Base Salary for Incentive Awards and (b) the greater of $2,000,000 or 500% of the Participant’s
Base Salary for Long-Term Incentive Awards. The maximum aggregate number of shares of Stock that
may be granted to any single Participant in any calendar year with respect to Awards the
compensation of which is determined by the number of shares of Stock actually awarded or subject to
vesting shall be 300,000 shares, subject to adjustment as provided in Section 11 of the Stock Plan;
provided, however, that with respect to Awards that may be subject to Section 162(m) of the Code,
such modifications and/or changes do not disqualify compensation attributable to such Awards as “performance-based compensation” under Section
162(m) of the Code.

 

4

 

Section 5

PAYMENT OF INCENTIVE AWARDS

5.1 Form and Timing of Payment. The Company shall pay to each Participant the amount due
under the Participant’s Incentive Award or Long-Term Incentive Award for the applicable Performance
Period, in cash or Stock, in accordance with the terms and conditions of the Award and the
procedures established by the Committee. All Awards payable in Stock shall be issued pursuant to
the Stock Plan to the extent of shares of Stock available for issuance thereunder. Unless
otherwise specified in the Award Agreement, each Award shall be paid on the March 15 of the
calendar year following the calendar year in which the Performance Period ends.

5.2 Payment of Partial Awards. In the event a Participant no longer meets the eligibility
criteria set forth in the Plan during the course of a particular Performance Period (other than due
to termination of employment), the Committee may, in its discretion, pay a partial award for the
portion of the Performance Period the individual was a Participant.

5.3 Termination of Employment. It is a condition to the payment of an Incentive Award and a
Long-Term Incentive Award under the Plan that the Participant be employed on the date of payment,
unless the Award Agreement providing for such Award specifically provides otherwise.

5.4 Change in Control Termination. Unless an Incentive Award or any Long-Term Incentive Award
specifically provides otherwise, if the Company terminates a Participant’s employment coincident
with or after a Change in Control, the Participant shall be entitled to receive an amount of such
Award for such Performance Period equal to the product of (a) a target level Award multiplied by
(b) a fraction, the numerator of which is the number of days that the Participant was participating
during the applicable Performance Period through the day of termination and the denominator of
which is the total number of days comprising such Performance Period. Payment under this Section
5.4 may be made in accordance with Section 5.1 or sooner, as determined by the Committee in its
discretion.

5.5 Section 409A Delay. If any Incentive Award or Long-Term Incentive Award under the Plan is
considered to be non-qualified deferred compensation within the meaning of Section 409A of the
Internal Revenue Code of 1987, as amended (the “Code”), and payment under such Award is being made
upon a Participant’s termination of employment, then if such Participant is a “specified employee”
for purposes of Section 409A(a)(2)(B)(i) of the Code, to the extent delayed commencement of any
portion of the payments to which the Participant is entitled is required in order to avoid a
prohibited distribution under Section 409A(a)(2)(B)(i) of the Code, such portion of the payments
will not be provided to the Participant prior to the earlier of (1) the expiration of the six-month
period measured from the date of the Participant’s “separation from service” with the Company (as
such term is defined in the Treasury Regulations issued under Section 409A of the Code) or (2) the
Participant’s death. Upon the expiration of the applicable Code Section 409A(a)(2)(B)(i) deferral
period, all payments deferred pursuant to this Section 5.5 shall be paid in a lump sum.

Section 6

RIGHTS OF PARTICIPANTS

6.1 No Employment Rights. Nothing in the Plan shall interfere with or limit in any way
the right of the Company to terminate any Eligible Individual’s employment at any time, nor confer
upon any Eligible Individual any right to continue in the employ of the Company.

 

5

 

6.2 Nontransferability. No Participant or any other person shall have any right to commute,
sell, assign, transfer, pledge, anticipate, mortgage or otherwise encumber, transfer, hypothecate
or convey in advance of actual receipt of the amounts, if any, payable hereunder, or any part
thereof, which are, and all rights to which are, expressly declared to be unassignable and
non-transferable. No part of the amounts payable shall, prior to actual payment, be subject to
seizure or sequestration for the payment of any debts, judgment, alimony or separate maintenance
owed by a Participant or any other person, nor be transferable by operation of law in the event of
a Participant’s or any other person’s bankruptcy or insolvency.

Section 7

ADMINISTRATION, LIABILITY, INDEMNIFICATION

7.1 Administration. The Committee shall administer the Plan in accordance with its
terms, and shall have the sole discretion and authority necessary to carry out the administration
of the Plan. With respect to Participants whose position is below the Senior Vice President level,
the Committee may delegate, to one or more individuals, some or all of its authority to administer
the Plan and to permit such individuals to have the discretion necessary to carry out the
administration of the Plan to the extent that award and payment of Awards to such Participants are
not subject to Section 162(m) of the Code. Such authority shall include the authority to:

(a) Select the Eligible Individuals eligible to participate in the Plan for each Performance
Period or portion thereof;

(b) To determine eligibility for and the type and size of an Award granted under the Plan;

(c) To grant Awards to, and to enter into Award Agreements with, Participants;

(d) Determine the Performance Goals applicable to the payment of Incentive Awards and
Long-Term Incentive Awards, and the amount of the Incentive Awards and Long-Term Incentive Awards
payable upon the Participants’ achievement of the applicable Performance Goals;

(e) To the extent consistent with the Plan, to impose such terms, limitations, restrictions,
and conditions upon the receipt of Incentive Awards and Long-Term Incentive Awards as it deems
appropriate, and, to the extent consistent with the Plan, to grant waivers of Plan terms,
conditions, restrictions, and limitations;

(f) To accelerate the vesting conditions of any Award payable in Stock when such action would
be in the best interests of the Company;

(g) Interpret the Plan, make any necessary factual determinations under the Plan, adopt,
amend, and rescind administrative guidelines and other rules and regulations relating to the Plan;

(h) Correct any defect or omission or reconcile any inconsistency in this Plan or any award of
payment hereunder, and

(i) Make all other necessary determinations and take all other actions necessary or advisable
for the implementation and administration of the Plan.

(j) The Committee’s determinations on matters within its authority shall be conclusive and
binding upon all parties (including Participants’ heirs, successors and legal representatives).

 

6

 

7.2 Liability; Indemnification. No member of the Board, no member of the Committee and no
employee of the Company shall be liable for any act or failure to act hereunder, except in
circumstances involving his or her bad faith, gross negligence or willful misconduct, or for any
act or failure to act hereunder by any other member or employee or by any agent to whom duties in
connection with the administration of the Plan have been delegated. The Company shall indemnify
members of the Committee and any agent of the Committee who is an employee of the Company, against
any and all liabilities or expenses to which they may be subjected by reason of any act or failure
to act with respect to their duties on behalf of the Plan, except in circumstances involving such
person’s bad faith, gross negligence or willful misconduct.

Section 8

AMENDMENT, MODIFICATION AND TERMINATION

The Committee, in its sole discretion, without notice, at any time and from time to time,
may in writing modify or amend, in whole or in part, any or all of the provisions of the Plan, or
suspend or terminate it entirely; provided, however, that no such modification, amendment,
suspension, or termination may, without the consent of a Participant (or his or her beneficiary in
the case of the death of the Participant), reduce the right of a Participant (or his or her
beneficiary, as the case may be) to a payment or distribution hereunder to which he or she is
otherwise entitled.

Section 9

MISCELLANEOUS

9.1 Governing Law. The Plan, and all agreements hereunder, shall be governed by and
construed in accordance with the laws of the State of Illinois (without regard for its conflict of
laws rules).

9.2 Withholding Taxes. The Company shall have the right to deduct from all payments under the
Plan any Federal, state, or local taxes required by law to be withheld with respect to such
payments.

9.3 Shareholder Approval. This Plan, and any Awards hereunder to be granted after the annual
meeting of shareholders immediately succeeding the date that this Plan is adopted by the Board, are
made subject to the condition that the Plan be approved by the shareholders of the Company. If the
Plan is not so approved, it and such Awards shall be null and void and without effect. Shareholder
approval shall not be required for Awards granted prior to such annual meeting. If required by
Section 162(m) of the Code or any successor regulation or rule, the material terms of performance
goals as described in Section 4.1 shall be disclosed to and reapproved by the shareholders of the
Company no later than the first shareholder meeting that occurs in the 5th year following the year
in which the Company’s shareholders previously approved such performance goals.

9.4 Costs of the Plan. All costs of implementing and administering the Plan shall be borne by
the Company.

9.5 Unsecured General Creditor. Participants and their heirs, successors and assigns shall
have no legal or equitable rights, interest or claims in any property or assets of the Company by
virtue of participation in the Plan. The Company’s obligation under the Plan shall be that of an
unfunded and unsecured promise of the Company to pay money in the future.

9.6 Entire Agreement. Except to the extent an Employment Agreement expressly provides for
additional or other terms pertaining to a Participant’s or beneficiary’s incentive compensation,
this Plan (as may be amended from time to time) and Award Agreements thereunder are the entire
agreement between the Company and the Participants and beneficiaries regarding the Plan. No oral statement regarding the Plan may be relied upon by
any Participant or beneficiary.

 

7

 

9.7 Limitations of Liability. The liability of the Company under this Plan is limited to the
obligations expressly set forth in the Plan, and no term or provision of the Plan may be construed
to impose any further or additional duties, obligations or costs on the Company or the Committee
not expressly set forth in the Plan.

9.8 Successors. All obligations of the Company under the Plan shall be binding upon and inure
to the benefit of any successor to the Company, whether the existence of such successor is the
result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or
substantially all of the business and/or assets of the Company.

9.9 Captions, Gender and Number. The descriptive headings in this Plan are inserted for
convenience of reference only and are not intended to be part of or to affect the meaning or
interpretation of the Plan. The use of the word “including” in this Plan shall be by way of
example rather than by limitation. Except where otherwise indicated by the context, any masculine
term used herein also shall include the feminine, the plural shall include the singular, and the
singular shall include the plural.

9.10 Headings. The headings and captions contained herein are provided for convenience only,
and are not to be used to in the interpretation or construction of any provision contained in the
Plan.

9.11 Severability. In the event any provision of the Plan shall be held illegal or invalid
for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and
the Plan shall be construed and enforced as if the illegal or invalid provision had not been
included.

IN WITNESS WHEREOF, the Company has executed this Plan by its duly authorized officers as of
this 2nd day of August, 2007, effective the effective date set forth in Section 1.2.

APAC CUSTOMER SERVICES, INC.

By: /s/GEORGE H. HEPBURN III

Its: Senior Vice President and CFO

 

8

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