8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 or 15(d) OF THE

SECURITITES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): March 6, 2005

CSG SYSTEMS INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Delaware	0-27512	47-0783182
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

7887 East Belleview, Suite 1000, Englewood, CO	80111
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (303) 796-2850

Check the appropriated box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On March 6, 2005, the Board of Directors of CSG Systems International, Inc. (“CSG”) made certain changes to CSG’s executive management team and Board of Directors, and to the related employment agreements with certain of these individuals, as outlined below.

Neal C. Hansen:

Effective March 31, 2005, Neal C. Hansen, CSG’s current Chief Executive Officer (“CEO”) and Chairman of the Board of Directors (the “Chairman”), will resign as CEO. Mr. Hansen will continue in his role as Chairman until his previously announced retirement date of June 30, 2005, at which time he will resign as Chairman. Mr. Hansen will remain on the Board of Directors through his current term which ends in 2006.

In conjunction with Mr. Hansen’s change in employment duties effective March 31, 2005, CSG and Mr. Hansen entered into the Sixth Amendment to Employment Agreement with Neal C. Hansen, dated March 8, 2005 (the “Sixth Amendment”). The consideration to be paid to Mr. Hansen is not expected to change from that previously agreed to in the Fifth Amendment to Employment Agreement with Neal C. Hansen, dated December 20, 2004.

A copy of the Sixth Amendment is attached hereto as Exhibit 10.14F and hereby incorporated by reference.

Edward C. Nafus:

Effective April 1, 2005, Edward C. Nafus, CSG’s current President of the Broadband Services Division, will assume the position of CEO and President of CSG. In addition, effective March 7, 2005, the CSG Board of Directors approved that the number of directors of CSG be increased by one and fixed at seven, that the number of Class I directors of CSG be increased to two, and that Mr. Nafus be named as a Class I director of CSG to fill the vacancy created by the increase in the number of Class I directors of CSG.

In conjunction with these changes for Mr. Nafus, CSG and Mr. Nafus entered into the Second Amendment to Employment Agreement with Edward Nafus, dated March 8, 2005 (the “Second Amendment”). Besides the change in employment duties, a brief description of the material changes from the previous version of Mr. Nafus’ employment agreement is as follows:

• Effective April 1, 2005, Mr. Nafus’ base salary will be adjusted to $550,000 per year. Mr. Nafus shall have the opportunity to earn an incentive bonus of not less than one hundred percent of his base salary if the agreed upon objectives for the particular calendar year are fully achieved.

• Effective April 1, 2005, certain events that shall be deemed to be a “change of control” were modified.

• Mr. Nafus will be granted restricted stock awards of CSG common stock with a zero exercise price as follows: (i) 50,000 shares on July 1, 2005; and (ii) 50,000 shares on January 1, 2006. Mr. Nafus must be employed by CSG at the date of grant in order to receive these restricted stock awards. The restricted stock awards will vest (contingent upon Mr. Nafus’ continued employment with CSG) ratably over four years from the date of the grant, and will vest immediately upon: (i) a change of control, as defined; or (ii) upon Mr. Nafus’ voluntary retirement from the employ of CSG after March 31, 2008.

A copy of the Second Amendment is attached hereto as Exhibit 10.46B and hereby incorporated by reference.

John “Hank” Bonde:

Effective March 7, 2005, John “Hank” Bonde, CSG’s current Chief Operating Officer and President of CSG, was removed from these positions and was then elected as Executive Vice President of CSG and appointed to the position of President of the Global Software Services Division of CSG. CSG and Mr. Bonde are currently negotiating an amendment to his employment agreement to reflect his change in responsibilities.

Robert M. Scott:

Effective March 7, 2005, Robert M. Scott, CSG’s current Executive Vice President of Development, Delivery and Operations for the Broadband Services Division, was appointed to the position of Executive Vice President and General Manager of the Broadband Services Division of CSG. At this time, CSG does not have an employment agreement with Mr. Scott.

Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

On March 6, 2005, the Board of Directors of CSG made certain changes to CSG’s executive management team and Board of Directors. The text set form in Item 1.01 regarding these changes is incorporated into this section by reference.

In conjunction with these changes, CSG entered into amendments to Mr. Hansen’s and Mr. Nafus’ employment agreements. The text set forth in Item 1.01 regarding the amendments to the employment agreements is incorporated into this section by reference.

Mr. Nafus does not have any family relationships with any executive officer or director of CSG or its affiliates. He is not a party to any transaction requiring disclosure under Item 404(a) of Regulation S-K.

Item 9.01 Financial Statements and Exhibits.

(c) Exhibits

10.14F	Sixth Amendment to Employment Agreement with Neal C. Hansen, dated March 8, 2005
10.46B	Second Amendment to Employment Agreement with Edward Nafus, dated March 8, 2005

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: March 10, 2005

CSG SYSTEMS INTERNATIONAL, INC.
By:	/s/ Randy Wiese
	Randy Wiese, Principal
	Accounting Officer

CSG Systems International, Inc.

Form 8-K

Exhibit Index

10.14F	Sixth Amendment to Employment Agreement with Neal C. Hansen, dated March 8, 2005
10.46B	Second Amendment to Employment Agreement with Edward Nafus, dated March 8, 2005

EX-10.14F

Exhibit 10.14F

SIXTH AMENDMENT

to

EMPLOYMENT AGREEMENT

among

CSG SYSTEMS INTERNATIONAL, INC.

and

CSG SYSTEMS, INC.

and

NEAL C. HANSEN

This Sixth Amendment to Employment Agreement (the “Amendment”) is made this 8^th day of March, 2005, among CSG SYSTEMS INTERNATIONAL, INC. (“CSGS”), a Delaware corporation, CSG SYSTEMS, INC. (“Systems”), a Delaware corporation, and NEAL C. HANSEN (“Hansen”). CSGS and Systems collectively are referred to in this Amendment and the Employment Agreement referred to below as the Companies.

* * *

WHEREAS, the Companies and the Executive entered into an Employment Agreement dated November 17, 1998 (the “Employment Agreement”); and

WHEREAS, the Employment Agreement has been amended by First, Second, Third, Fourth, and Fifth Amendments to the Employment Agreement dated June 30, 2000, April 29, 2002, August 30, 2002, November 15, 2002, and December 20, 2004, respectively; and

WHEREAS, the Companies and the Executive now desire to amend Paragraph 1 of the Fifth Amendment (dated December 20, 2004) to the Employment Agreement;

NOW, THEREFORE, in consideration of the foregoing recitals and the respective covenants and agreements of the parties contained in this document, the Companies and the Executive agree as follows:

1. Effective immediately, Paragraph 1 of the Fifth Amendment (dated December 20, 2004) to the Employment Agreement hereby is amended in its entirety so as to read as follows:

“1. Hansen and the Companies agree that, effective at the close of business on March 31, 2005, Hansen shall resign as Chief Executive Officer of the Companies and as an officer of any subsidiary entities of the Companies for which he serves in such capacity. After the close of business on March 31, 2005, Hansen no longer shall have the powers, authorities, and responsibilities and no longer shall perform the duties of the Chief Executive Officer of the Companies. Until the close of business on June 30, 2005, Hansen shall continue to serve as

Chairman of the Board of the Companies and shall remain in the employ of the Companies. Hansen and the Companies further agree that, effective at the close of business on June 30, 2005, Hansen (i) shall resign as Chairman of the Board of the Companies, (ii) if so requested by CSGS, shall resign as a director of any subsidiary entities of the Companies for which he serves in such capacity, and (iii) shall retire from the employ of the Companies. Hansen agrees that his resignations and retirement provided for in this Paragraph 1 will constitute his voluntary resignations and the voluntary termination of his employment for purposes of the Employment Agreement and that, except as otherwise provided in Paragraphs 3, 4, and 5 of this Fifth Amendment, Paragraph 10(g) of the Employment Agreement shall be applicable to the termination of Hansen’s employment with the Companies at the close of business on June 30, 2005.”

2. Upon execution of this Sixth Amendment by the parties, any subsequent reference to the Employment Agreement between the parties shall mean the Employment Agreement as amended by the Second, Third, Fourth, Fifth, and this Sixth Amendment (the First Amendment having been superseded by the Second Amendment). As amended by the Second, Third, Fourth, Fifth, and this Sixth Amendment, the Employment Agreement shall continue in full force and effect according to its terms until the Employment Agreement, as so amended, is terminated (except for those obligations referred to in Paragraph 9 of the Fifth Amendment which will survive such termination and continue to be enforceable) pursuant to the Fifth Amendment to the Employment Agreement.

IN WITNESS WHEREOF, each of the parties has executed this Sixth Amendment to Employment Agreement as of the date first above written.

CSG SYSTEMS INTERNATIONAL, INC.
By:	/S/ JOSEPH T. RUBLE
	Joseph T. Ruble, Secretary and General
	Counsel
CSG SYSTEMS, INC.
By:	/S/ JOSEPH T. RUBLE
	Joseph T. Ruble, Senior Vice President and General Counsel
	/S/ NEAL C. HANSEN
	Neal C. Hansen

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EX-10.46B

Exhibit 10.46B

SECOND AMENDMENT TO EMPLOYMENT AGREEMENT

This Second Amendment to Employment Agreement is made and entered into on the 8^th day of March, 2005, among CSG SYSTEMS INTERNATIONAL, INC. (“CSGS”), a Delaware corporation, CSG SYSTEMS, INC. (“Systems”), a Delaware corporation, and EDWARD NAFUS (the “Executive”). CSGS and Systems collectively are referred to in this Second Amendment and the Employment Agreement referred to below as the “Companies”.

* * *

WHEREAS, the Companies and the Executive entered into an Employment Agreement dated November 17, 1998 (the “Employment Agreement”); and

WHEREAS, the Companies and the Executive entered into a First Amendment to the Employment Agreement dated January 11, 2005 (the “First Amendment”); and

WHEREAS, the Companies desire to further amend the Employment Agreement as herein set forth;

NOW, THEREFORE, in consideration of the foregoing recitals and the agreements of the parties contained in this document, the Companies and the Executive agree as follows:

1. Effective as of the commencement of business on April 1, 2005, Paragraph 1 of the Employment Agreement hereby is amended in its entirety so as to read as follows:

“1. Employment and Duties. Each of the Companies hereby employs the Executive as its Chief Executive Officer and President throughout the term of this agreement and agrees to cause the Executive from time to time to be elected or appointed to such corporate offices or positions. The duties and responsibilities of the Executive shall include the duties and responsibilities of the Executive’s corporate offices and positions referred to in the preceding sentence which are set forth in the respective bylaws of the Companies from time to time, overall responsibility for the development and implementation of the business plans and strategies of the Companies, and such other duties and authorities consistent with the Executive’s corporate offices and positions referred to in the preceding sentence and this agreement which the Board of Directors of CSGS (the “Board”) from time to time may assign to the Executive. If the Executive is elected or appointed as a director of CSGS or Systems or as an officer or director of any of the respective subsidiaries of the Companies during the term of this agreement, then he also shall serve in such capacity or capacities but without additional compensation.”

2. Effective as of the commencement of business on April 1, 2005, Paragraph 4 of the Employment Agreement hereby is amended in its entirety so as to read as follows:

“4. Base Salary. For all services to be rendered by the Executive pursuant to this agreement, the Companies agree to pay the Executive during the term of this agreement a base salary (the “Base Salary”) at an annual rate of not less than Five Hundred Fifty Thousand Dollars ($550,000.00). The Executive’s annual incentive bonus provided for in Paragraph 5 and all other compensation and benefits to which the Executive is or may become entitled pursuant to this agreement or under any plans or programs of the Companies shall be in addition to the Base Salary.”

3. Effective as of the commencement of business on April 1, 2005, the fifth sentence of Paragraph 5 of the Employment Agreement hereby is amended in its entirety so as to read as follows:

“Such incentive bonus program for each calendar year shall provide the opportunity for the Executive to earn an incentive bonus of not less than one hundred percent (100%) of his Base Salary for such calendar year if the agreed upon objectives for the particular calendar year are fully achieved.”

4. Effective as of the commencement of business on April 1, 2005, Paragraph 7 of the Employment Agreement hereby is amended in its entirety so as to read as follows:

“7. Other Benefits. During the term of this agreement, the Companies shall provide to the Executive and his eligible dependents at the expense of the Companies individual or group medical, hospital, dental, and long-term disability insurance coverages and group life insurance coverage, in each case at least as favorable as those coverages which are provided to the other senior executives of the Companies. During the term of this agreement, the Executive shall be entitled to receive a monthly automobile allowance from the Companies in the amount of Eight Hundred Dollars ($800.00) and to financial and tax planning services in accordance with the current policies and practices of the Companies for its senior executives. During the term of this agreement, the Executive also shall be entitled to participate in such other benefit plans or programs which the Companies from time to time may make available to their employees generally (except such programs, such as the 1996 Employee Stock Purchase Plan of CSGS, in which executive officers of CSGS are not eligible to participate because of securities law restrictions). The Stock Incentive Plans of CSGS are administered by the Compensation Committee of the Board, and such Committee has sole authority to make grants to the Executive under such Plans. The Companies agree that (i) if the Executive is employed by the Companies on July 1, 2005, the Compensation Committee of the Board shall grant to the Executive a restricted stock award under a Stock Incentive Plan of CSGS covering 50,000 shares of the Common Stock of CSGS and (ii) if the Executive is employed by the Companies on January 1, 2006, the Compensation Committee of the Board shall grant to the

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Executive an additional restricted stock award under a Stock Incentive Plan of CSGS covering 50,000 shares of the Common Stock of CSGS. The vesting of the shares covered by such restricted stock awards will be at the rate of 25% of the shares covered by an award on each of the first four anniversaries of the award date if the Executive is then employed by the Companies but with the immediate vesting of any unvested shares covered by such restricted stock awards (i) upon a Change of Control or (ii) upon the termination of the Executive’s employment with the Companies after March 31, 2008, solely as a result of the Executive’s voluntary retirement from the employ of the Companies; however, such grants and their respective vesting schedules will not in any way obligate the Companies to continue the employment of the Executive in any capacity or for any particular period of time or be deemed to extend the term of this agreement.”

5. Effective as of the commencement of business on April 1, 2005, Paragraph 15 of the Employment Agreement hereby is amended in its entirety so as to read as follows:

“15. Change of Control. For purposes of this agreement, a “Change of Control” shall be deemed to have occurred upon the happening of any of the following events:

(a) CSGS is merged or consolidated into another corporation, and immediately after such merger or consolidation becomes effective the holders of a majority of the outstanding shares of voting capital stock of CSGS immediately prior to the effectiveness of such merger or consolidation do not own (directly or indirectly) a majority of the outstanding shares of voting capital stock of the surviving or resulting corporation in such merger or consolidation;

(b) any person, entity, or group of persons within the meaning of Sections 13(d) or 14(d) of the Securities Exchange Act of 1934 (the “1934 Act”) and the rules promulgated thereunder becomes the beneficial owner (within the meaning of Rule 13d-3 under the 1934 Act) of thirty percent (30%) or more of the outstanding voting capital stock of CSGS;

(c) the Common Stock of CSGS ceases to be publicly traded because of an issuer tender offer or other “going private” transaction (other than a transaction sponsored by the then current management of CSGS);

(d) CSGS dissolves or sells or otherwise disposes of all or substantially all of its property and assets (other than to an entity or group of entities which is then under common majority ownership (directly or indirectly) with CSGS);

(e) in one or more substantially concurrent transactions or in a series of related transactions, CSGS directly or indirectly disposes of a portion or portions of its business operations (collectively, the “Sold Business”) other

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than by ceasing to conduct the Sold Business without its being acquired by a third party (regardless of the entity or entities through which CSGS conducted the Sold Business and regardless of whether such disposition is accomplished through a sale of assets, the transfer of ownership of an entity or entities, a merger, or in some other manner) and either (i) the fair market value of the consideration received or to be received by CSGS for the Sold Business is equal to at least fifty percent (50%) of the market value of the outstanding Common Stock of CSGS determined by multiplying the average of the closing prices for the Common Stock of CSGS on the thirty (30) trading days immediately preceding the date of the first public announcement of the proposed disposition of the Sold Business by the average of the numbers of outstanding shares of Common Stock on such thirty (30) trading days or (ii) the revenues of the Sold Business during the most recent four (4) calendar quarters ended prior to the first public announcement of the proposed disposition of the Sold Business represented fifty percent (50%) or more of the total consolidated revenues of CSGS during such four (4) calendar quarters; or

(f) during any period of two consecutive years or less, individuals who at the beginning of such period constituted the Board of Directors of CSGS cease, for any reason, to constitute at least a majority of the Board of Directors of CSGS, unless the election or nomination for election of each new director of CSGS who took office during such period was approved by a vote of at least seventy-five percent (75%) of the directors of CSGS still in office at the time of such election or nomination for election who were directors of CSGS at the beginning of such period.”

6. Upon the execution of this Second Amendment to Employment Agreement by the parties, any subsequent reference to the Employment Agreement shall mean the Employment Agreement as amended by the First Amendment and by this Second Amendment. As amended by this Second Amendment to Employment Agreement, the Employment Agreement, as amended by the First Amendment, shall remain in full force and effect according to its terms.

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IN WITNESS WHEREOF, each of the parties has caused this Second Amendment to Employment Agreement to be executed as of the date first set forth above.

CSG SYSTEMS INTERNATIONAL, INC.,
a Delaware corporation
By:	/S/ NEAL C. HANSEN
	Neal C. Hansen, Chairman of the
	Board and Chief Executive Officer
CSG SYSTEMS, INC., a Delaware
corporation
By:	/S/ NEAL C. HANSEN
	Neal C. Hansen, Chairman of the
	Board and Chief Executive Officer
	/S/ EDWARD C. NAFUS
	Edward Nafus

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