SCHEDULE 14AUNITED STATES
SECURITIES AND EXCHANGE COMMISSION
(Rule 14a-101)Washington, D.C. 20549

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.   )
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oSoliciting Material under Rule 14a-12Pursuant to §240.14a-12

Sykes Enterprises, Incorporated
(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other thanOther Than the Registrant)

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TABLE OF CONTENTS

     (3)NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 21, 2008
Filing Party:PROXY STATEMENT FOR 2008 ANNUAL MEETING OF SHAREHOLDERS
SHAREHOLDERS ENTITLED TO VOTE
PROPOSAL 1:
ELECTION OF DIRECTORS
DIRECTORS STANDING FOR ELECTION AT THE 2008 ANNUAL MEETING
CLASS I -- TERM EXPIRES AT THE 2011 ANNUAL MEETING
DIRECTORS WHOSE TERMS OF OFFICE CONTINUE
CLASS III -- TERM EXPIRES AT THE 2009 ANNUAL MEETING
CLASS II -- TERM EXPIRES AT THE 2010 ANNUAL MEETING
CORPORATE GOVERNANCE
MEETINGS AND COMMITTEES OF THE BOARD
EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
COMPENSATION AND HUMAN RESOURCE DEVELOPMENT COMMITTEE REPORT
SUMMARY COMPENSATION TABLE
GRANTS OF PLAN-BASED AWARDS
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
OPTION EXERCISES AND STOCK VESTED
PENSION BENEFITS
NONQUALIFIED DEFERRED COMPENSATION
EQUITY COMPENSATION PLAN INFORMATION
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL
EMPLOYMENT AGREEMENTS
DIRECTOR COMPENSATION
SECURITY OWNERSHIP
PROPOSAL 2 RATIFICATION OF THE APPOINTMENT OF INDEPENDENT AUDITORS
AUDIT COMMITTEE DISCLOSURE
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS
OTHER MATTERS

     (4)Date Filed:

(SYKES LOGO)(SYKES LOGO)
400 North Ashley Drive

Tampa, Florida 33602
 
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

TO BE HELD MAY 24, 200521, 2008
To the Shareholders of Sykes Enterprises, Incorporated:
 
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders (the “Annual Meeting”) of Sykes Enterprises, Incorporated (the “Company”) will be held at the Tampa Marriott Waterside, 700 South Florida Avenue, Tampa, Florida, on Tuesday,Wednesday, May 24, 2005,21, 2008, at 9:00 a.m., Eastern Daylight Savings Time, for the following purposes:
      1. To elect 4 directors to hold office until the 2008 Annual Meeting of Shareholders and 1 director to hold office until the 2006 Annual Meeting of Shareholders;
      2. To approve the 2004 Non-Employee Director Fee Plan;
      3. To approve the acceleration of the vesting of stock options held by certain Non-Employee Directors; and
      4. To transact any other business as may properly come before the Annual Meeting.
1. To elect 4 directors to hold office until the 2011 Annual Meeting of Shareholders;
 
2. To ratify the appointment of Deloitte & Touche LLP as independent auditors of the Company; and
3. To transact any other business as may properly come before the Annual Meeting.
Only shareholders of record as of the close of business on April 18, 2005,4, 2008, will be entitled to vote at the Annual Meeting or any adjournment or postponement of the Annual Meeting. Information relating to the matters to be considered and voted on at the Annual Meeting is set forth in the proxy statement accompanying this Notice.
By Order of the Board of Directors,
-s- JAMES T. HOLDER
James T. Holder
Secretary
By Order of the Board of Directors,
-s- JAMES T. HOLDER
James T. Holder
Secretary
April 19, 200518, 2008
YOUR VOTE IS IMPORTANT
 
To assure your representation at the Annual Meeting, please vote on the matters to be considered at the Annual Meeting by completing the enclosed proxy and mailing it promptly in the enclosed envelope. If your shares are held in street name by a brokerage firm, bank or other nominee, the nominee will supply you with a proxy card to be returned to it. It is important that you return the proxy card as quickly as possible so that the nominee may vote your shares. If your shares are held in street name by a nominee, you may not vote such shares in person at the Annual Meeting unless you obtain a power of attorney or legal proxy from such nominee authorizing you to vote the shares, and you present this power of attorney or proxy at the Annual Meeting.

(SYKES LOGO)
(SYKES LOGO)
400 North Ashley Drive

Tampa, Florida 33602
 
PROXY STATEMENT

FOR
2005
2008 ANNUAL MEETING OF SHAREHOLDERS
This Proxy Statement is furnished in connection with the solicitation of proxies on behalf of the Board of Directors of Sykes Enterprises, Incorporated (the “Company”) for the Annual Meeting of Shareholders (the “Annual Meeting”) to be held at the Tampa Marriott Waterside, 700 South Florida Avenue, Tampa, Florida, on Tuesday,Wednesday, May 24, 2005,21, 2008, at 9:00 a.m., Eastern Daylight Savings Time, or any adjournment or postponement of the Annual Meeting.
 
This Proxy Statement and the annual report to shareholders of the Company for the year ended December 31, 2004,2007, are first being mailed on or about April 23, 2005,21, 2008, to shareholders entitled to vote at the Annual Meeting.
SHAREHOLDERS ENTITLED TO VOTE
 
The record date for the Annual Meeting is April 18, 2005.4, 2008. Only shareholders of record as of the close of business on the record date are entitled to notice of the Annual Meeting and to vote at the Annual Meeting. As of the record date, 40,218,46741,105,924 shares of common stock were outstanding and entitled to vote at the Annual Meeting.
 
Votes cast by proxy or in person at the Annual Meeting will be tabulated by the inspector of elections appointed for the Annual Meeting, who will also determine whether a quorum is present for the transaction of business. The Company’s Bylaws provide that a quorum is present if the holders of a majority of the issued and outstanding shares of common stock entitled to vote at the meeting are present in person or represented by proxy. At the Annual Meeting, if a quorum exists, Directorsdirectors will be elected by a plurality of the votes cast in the election, and the approval of each of Proposals 2 and 3 will require the affirmative vote of a majority of the votes cast on the Proposal.election. Abstentions will be counted as shares that are present and entitled to vote for purposes of determining whether a quorum is present, and will count as votes against Proposals 2 and 3.present. Shares held by nominees for beneficial owners will also be counted for purposes of determining whether a quorum is present if the nominee has the discretion to vote on at least one of the matters presented, even though the nominee may not exercise discretionary voting power with respect to other matters and even though voting instructions have not been received from the beneficial owner (a “broker non-vote”). Broker non-votes will not be counted as votes cast in determining whether a Proposal has been approved.
 
Shareholders are requested to vote by completing the enclosed Proxy and returning it signed and dated in the enclosed postage-paid envelope. Shareholders are urged to indicate their votes in the spaces provided on

the Proxy. Proxies solicited by the Board of Directors of the Company will be voted in accordance with the directions given in the Proxy. Where no instructions are indicated, signed Proxies will be voted FOR each of the proposals listed in the Notice of Annual Meeting of Shareholders. Returning your completed Proxy will not prevent you from voting in person at the Annual Meeting, should you be present and wish to do so.
 
Any shareholder giving a Proxy has the power to revoke it at any time before it is exercised by:
 • filing with the Secretary of the Company written notice of revocation,
 
 • submitting a duly executed Proxy bearing a later date than the previous Proxy, or
 
 • appearing at the Annual Meeting and voting in person.

 
Proxies solicited by this Proxy Statement may be exercised only at the Annual Meeting and any adjournment of the Annual Meeting and will not be used for any other meeting. Proxies solicited by this Proxy Statement will be returned to the Board of Directors and will be tabulated by an inspector of elections designated by the Board of Directors.
 
The cost of solicitation of Proxies by mail on behalf of the Board of Directors will be borne by the Company. Proxies also may be solicited by personal interview or by telephone by directors, officers, and other employees of the Company without additional compensation. The Company also has made arrangements with brokerage firms, banks, nominees, and other fiduciaries that hold shares on behalf of others to forward proxy solicitation materials to the beneficial owners of such shares. The Company will reimburse such record holders for their reasonableout-of-pocket expenses.
PROPOSAL 1:
ELECTION OF DIRECTORS
 
The Company’s Board of Directors currently is comprised of 11 individuals, and is divided into three classes (designated “CLASS I,” “CLASS II,” and “CLASS III”), as nearly equal in number as possible, with each class serving a three-year term expiring at the third annual meeting of shareholders after its election. The term of the four current CLASS I directors will expire at the Annual Meeting. The Company’s Board of Directors, upon the recommendation of the Nominating and Corporate Governance Committee, has nominated H. Parks Helms, and Dr. Linda McClintock-Greco, M.D., James K. (Jack) Murray, Jr., and James S. MacLeod to stand for re-election as CLASS I directors, and has further nominated James K. Murray, Jr. and James S. MacLeod for election to the Board at the Annual Meeting to fill the remaining two seats as members of CLASS I, whose terms will all expire at the 20082011 Annual Meeting of Shareholders.
 Additionally, the Florida Business Corporation Act requires that any director elected by the Board of Directors to fill a vacancy on the Board must stand for re-election at the next annual meeting of the shareholders. One director, Charles E. Sykes, was elected by the Board since the last annual meeting. The Company’s Board of Directors, upon the recommendation of the Nominating and Corporate Governance Committee, has nominated Mr. Sykes to stand for election to the Board at the Annual Meeting as a member of Class III, whose term will expire at the 2006 Annual Meeting of Shareholders.
In the event any nominee is unable to serve, the persons designated as proxies will cast votes for such other person in their discretion as a substitute nominee. The Board of Directors has no reason to believe that the nominees named herein will be unavailable or, if elected, will decline to serve.

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The Board of Directors recommends the following nominees for election as directors in the Classes specified and urges each shareholder to vote “FOR” the nominees. Executed proxies in the accompanying form will be voted at the Annual Meeting “FOR” the election as directors of the nominees named below, unless authority to do so is withheld.


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DIRECTORS STANDING FOR ELECTION AT THE 20052008 ANNUAL MEETING
CLASS I — TERM EXPIRES AT THE 20082011 ANNUAL MEETING
       
Name
 Age
Principal Occupation and Other Information
 
H. Parks Helms  6972  H. Parks Helms has served as a director of the Company since its inception in 1977.1977 and is a member and Chairman of the Nominating and Corporate Governance Committee. Mr. Helms is President and Managing Partner of the law firm of Helms, Henderson & Associates, P.A., in Charlotte, North Carolina and has been with the firm, and its predecessor firm, Helms, Cannon, Henderson & Porter, P.A. for more than the past five years. Mr. Helms has held numerous political appointments and elected positions, including as a member of the North Carolina House of Representatives. He currently is Vice Chairman of the Mecklenburg County, North Carolina Board of County Commissioners.
Linda McClintock-Greco, M.D.   5053  Linda McClintock-Greco, M.D. was elected to the Board of Directors in May of 1998 and is a member of the CompensationNominating and Human Resource DevelopmentCorporate Governance Committee. Since 1998, Dr. McClintock-Greco has been the President and Chief Executive Officer of Greco & Assoc. Consulting, a healthcare consulting firm, and in that capacity serves as the vice president of Medical Affairs for Entrusted Healthcare Management Services for the State of Florida. Until 1998, she served as Chief Executive Officer and Chief Medical Officer of Tampa General HealthPlan, Inc. (HealthEase) and had spent the past 11 years in the health care industry as both a private practitioner in Texas and a managed care executive serving as the Regional Medical Director with Humana Health Care Plan. Dr. McClintock-Greco serves on the Board of Directors of the Florida Association of Managed Care Organizations (FAMCO) . Dr. McClintock-Greco also serves on the board of several charitable organizations.


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Name
 Age
Principal Occupation and Other Information
 
James K. (Jack) Murray, Jr.   6972  James K. Murray, Jr., was elected to the Board of Directors in May 2005 and is a member of the Compensation and Human Resource Development Committee. During the past fifteen years, James K.Mr. Murray Jr. has served as Chairman of Murray Corporation, a private venture capital enterprise based in Tampa, Florida. In 1970, Mr. Murray was one of the founders of a company that is today HealthPlan Services, Inc. and PlanVista, Inc., which was acquired by The Dun & Bradstreet Corporation (NYSE:DNB) in 1978. From 1978 through 1993, Mr. Murray served in various capacities for Dun & Bradstreet Corporation, including President of Dun & Bradstreet Credit Services, and from 1990 through 1993, served in various capacities including President, principal executive officer and Chairman for the Reuben H. Donnelley Corp., a publisher of telephone yellow pages. In 1994, Mr. Murray and several other financial partners acquired HealthPlan Services from Dun & Bradstreet. In May, 1995, HealthPlan Services became a public company and was listed on the New York Stock Exchange. Mr. Murray retired from HealthPlan Services in 2000. Mr. Murray currently serves as a Trustee of Berkeley Preparatory School, and DaySpring Episcopal Center, and Chairman and Trustee of the St. John’s Episcopal Church Foundation, all in Tampa, Florida. Mr. Murray also serves as a member of the Board of The General Theological Seminary in New York City.

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NameAgePrincipal Occupation and Other Information
James S. MacLeod  5760  James S. MacLeod was elected to the Board of Directors in May 2005 and is a member of the Compensation and Human Resource Development Committee. Mr. MacLeod has served as Managing Director of CoastalStates Bank in Hilton Head Island, South Carolina since February, 2004. Mr. MacLeod also serves on the Board of Directors of CoastalStates Bank as well as Coastal Southand CoastalSouth Bancshares, its holding company. From June, 1982 to February, 2004, he served as Executive Vice President ofheld various positions at Mortgage Guaranty Insurance Corp.Corp in Milwaukee, Wisconsin.Wisconsin, the last 7 years serving as its Executive Vice President. Mr. MacLeod has a Bachelor of Science degree in economicsEconomics from the University of Tampa, a MastersMaster of Science in real estate financeReal Estate and Urban Affairs from Georgia State University and a Masters in City Planning from the Georgia Institute of Technology. Mr. MacLeod has served asis currently a memberTrustee of the Wisconsin Governor’s Mortgage Insurance Commission and Governor’s and Mayor’s Fair Lending Task Force, as well as the Fannie Mae Southeastern Regional Advisory Board. Mr. MacLeod has served as the Skylight Opera Theater’s representative to the United Performing Art Fund in Wisconsin,University of Tampa, Hilton Head Preparatory School and the Endowment Board of the Providence Presbyterian Church in Hilton Head, South Carolina.Allianz Funds.

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DIRECTORS WHOSE TERMS OF OFFICE CONTINUE
CLASS III — TERM EXPIRES AT THE 20062009 ANNUAL MEETING
       
Name
 Age
Principal Occupation and Other Information
 
Charles E. Sykes  4245  Charles E. Sykes was elected to the Board of Directors in August, 2004 to fill the vacancy created by the retirement of his father, the Company’s founder and former Chairman, John H. Sykes. Mr. Charles Sykes joined the Company in September, 1986 and has served in numerous capacities throughout his years with the Company. Mr. Charles Sykes was appointed as Vice President of Sales, North America in 1999 and between the years of 2000 to 2003 served as Group Executive, Sr.Senior Vice President of Marketing and Global Alliances, and Senior Vice President of Global Operations. Mr. Charles Sykes was appointed President and Chief Operating Officer in July, 2003 and was named President and Chief Executive Officer in August 2004. Mr. Charles Sykes received his Bachelor of Science degree in mechanical engineering from North Carolina State University in 1985. He has served as a Board Member of America’s Second Harvest of Tampa since 2004.
Furman P. Bodenheimer, Jr. 78Furman P. Bodenheimer, Jr. was elected to the Board of Directors in 1991 and is a member of the Nominating and Corporate Governance Committee. Mr. Bodenheimer has been President and Chief Executive Officer of Zickgraf Enterprises, Inc. and Nantahala Lumber in Franklin, North Carolina for more than the past five years. Mr. Bodenheimer is retired as president of the First Citizens Bank & Trust Company in North Carolina, where he was employed for 30 years.
William J. Meurer64William J. Meurer was elected to the Board of Directors in October 2000 and is a member and Chairman of the Audit Committee. Previously, Mr. Meurer was employed for 35 years with Arthur Andersen LLP where he served most recently as the Managing Partner for Arthur Andersen’s Central Florida operations. Since retiring from Arthur Andersen in 2000, Mr. Meurer has been a private investor and consultant. Mr. Meurer also serves on the Board of Trustees for St. Joseph’s Baptist Health Care and as a member of the Board of Directors of the Heritage Family of Funds and Tribridge, Inc.


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DIRECTORS WHOSE TERMS OF OFFICE CONTINUE
CLASS II — TERM EXPIRES AT THE 20072010 ANNUAL MEETING
       
Name
 Age
Principal Occupation and Other Information
 
Paul L. Whiting  6164  Paul L. Whiting was elected to the Board of Directors in December of 2003 and was elected Chairman in August, 2004. He is also a member of the Board’s Audit Committee. Since 1997 Mr. Whiting has been President of Seabreeze Holdings, Inc., a privately held consulting and investment company. From 1991 through 1996, Mr. Whiting held various positions within Spalding & Evenflo Companies, Inc., including Chief Executive Officer. Mr. Whiting has held similar high-level finance and administration positions at Questor Corporation, AP Parts Company, Lawrence Systems, Inc., EDAX International, Inc., and American National Bank & Trust Co. of Chicago.Corporation. Presently, Mr. Whiting is a Directorsits on the boards of Tampa Electric, TECO Energy, Inc. and The Tampa Banking Company.Co. Mr. Whiting also serves on the boards of various civic organizations, including, among others, the Academy Prep Center of Tampa, Inc., a full scholarship, private, college preparatory middle school for low-income children, where he is the Board President.
Mark C. Bozek  4346  Mark C. Bozek was elected to the Board of Directors in August of 2003 and is a member and Chairman of the Compensation and Human Resource Development Committee. Mr. Bozek is the President of HaloGalgos Entertainment, a privately held film production company which he founded in January 2003. From March 1997 until February 2003, Mr. Bozek served as the Chief Executive Officer of HSN (f/k/a Home Shopping Network.Network). From April 1993 until February 1996, Mr. Bozek served as the Vice President of Broadcasting for QVC. Mr. Bozek is an active member of the Young President’s Organization and he previously served as a member of the National Retail Federation board for four years.


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Name
 Age
Principal Occupation and Other Information
 
Lt. Gen Michael DeLong (Retired)  5962  Lt. General Michael DeLong (USMC Retired) was elected to the Board of Directors in September of 2003 and is a member of the Nominating and Corporate Governance Committee. Since NovemberOctober 2003, Lt. Gen. DeLong has served as Vice Chairman of Shaw Arabia Limited, President of Government Operations at TheShaw CentCom Services, LLC, and Senior Vice President of the Shaw Group, Inc. On February 19, 2008, Lt. Gen. DeLong was named President of Boeing Middle East, Ltd. From 1967 until his retirement on November 1, 2003, Lt. Gen. DeLong led a distinguished military career, most recently serving as the Deputy Commander, United States Central Command at Mac Dill Air Force Base, Tampa, Florida. He holds a Master’s Degree in Industrial Management from Central Michigan University and an honorary Doctorate in Strategic Intelligence from the Joint Military Intelligence College. Lieutenant General DeLongCollege and graduated from the Naval Academy as an Engineer. Lt. Gen. DeLong also serves as a director of AEBiofuels, Inc.
Iain A. Macdonald  6163  Iain A. Macdonald was originally elected to the Board of Directors in 1998 and served until 2001, when he resigned for personal reasons. Mr. Macdonald was re-elected to the Board of Directors in May of 2004 and issince then has been a member of the Audit Committee. During the past 510 years, Mr. Macdonald has served on the boards of a series of technology-based business ventures in the UK which he has assisted to develop and obtain funding. He is currently Chairman of Yakara plc, a developer of SMS telecommunications software solutions, and Realise Ltd., an internet systems integrator, botha member of which are located in Scotland. He is also on the Board of Northern AIM VCT plc, which is a Scottish venture capital investment fund. Mr. Macdonald previously served on the Board of Directorsfund, and he is a Director of the Company from 1998 to 2001, when he resignedScottish Industrial Development Advisory Board, which assesses applications for personal reasons.assistance by the Scottish Government. Prior to joining the Company’s Board in 1998, Mr. Macdonald served as a director of McQueen International LTD.Ltd. from 1996 until its acquisition by the Company.

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CLASS III — TERM EXPIRES AT THE 2006 ANNUAL MEETING
NameAgePrincipal Occupation and Other Information
Furman P. Bodenheimer, Jr. 75Furman P. Bodenheimer, Jr. was elected to the Board of Directors in 1991 and is a member of the Compensation and Human Resource Development Committee and the Nominating and Corporate Governance Committee. Mr. Bodenheimer has been President and Chief Executive Officer of Zickgraf Enterprises, Inc. and Nantahala Lumber in Franklin, North Carolina for more than the past five years.
William J. Meurer61William J. Meurer was elected to the Board of Directors in October 2000 and is a member and Chairman of the Audit Committee. Previously, Mr. Meurer was employed for 35 years with Arthur Andersen LLP where he served most recently as the Managing Partner for Arthur Andersen’s Central Florida operations. Mr. Meurer also serves on the Board of Trustees for St. Joseph’s Baptist Health Care and as a member of the Board of Directors of Tribridge, Inc.
PROPOSAL 2:
APPROVAL OF 2004 NON-EMPLOYEE DIRECTOR FEE PLANCORPORATE GOVERNANCE
 In May 2004, the Board of Directors approved the 2004 Non-Employee Director Fee Plan (the “2004 Fee Plan”), subject to shareholder approval at the 2005 Annual Meeting. The Board determined that the 2004 Fee Plan would replace and supercede the 1996 Non-Employee Director Fee Plan (the “1996 Fee Plan”), and also would be used in lieu of the 2004 Non-Employee Director Stock Option Plan (the “2004 Option Plan”), which was discussed in the Company’s proxy materials for the 2004 annual shareholders’ meeting and approved by the shareholders at the 2004 annual meeting. Therefore, no options have been awarded under the 2004 Option Plan, and none will be awarded under that plan if the 2004 Fee Plan is approved by the shareholders at the Annual Meeting.
      The purpose of the 2004 Fee Plan is to secure for the Company and its shareholders the benefits of the incentive inherent in increased ownership of common stock of the Company by members of the Board of Directors who are not employees by providing for the payment of a portion of each non-employee Director’s compensation in common stock. It is expected that such ownership will further align the interests of such non-employee Directors with the shareholders of the Company, thereby promoting the long-term profits and growth of the Company, and will encourage such non-employee Directors to remain Directors of the Company and provide them with the benefits of deferring the receipt of some of such compensation. It is also expected that the 2004 Fee Plan will encourage qualified persons to become Directors of the Company.
      The 2004 Fee Plan provides that all new non-employee Directors joining the Board receive an initial grant of common stock units (“CSUs”) on the date the new Director is appointed or elected, the number of which will be determined by dividing a dollar amount to be determined from time to time by the Board (initially set

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at $30,000) by an amount equal to 110% of the average closing prices of the Company’s common stock for the five trading days prior to the date the new Director is appointed or elected. The initial grant of CSUs will vest in three equal installments, one-third on the date of each of the following three annual shareholders’ meetings.
      A CSU is a bookkeeping entry on the Company’s books that records the equivalent of one share of common stock. On the date each CSU vests, the Director will become entitled to receive a share of the Company’s common stock and the CSU will be canceled. For federal income tax purposes, the Director will not be deemed to have received income with respect to the CSUs until the CSUs vest.
      Additionally, the 2004 Fee Plan provides that each non-employee Director who was serving as a Director immediately prior to each annual shareholders’ meeting, and who continues as a Director after the annual meeting, will receive, on the day after the annual meeting, an annual retainer for service as a non-employee Director, the amount of which shall be determined from time to time by the Board. The Board increased the amount of the annual retainer from $25,000 under the 1996 Fee Plan to $50,000 under the 2004 Fee Plan. Under the 2004 Fee Plan, the annual retainer will be paid 75% in CSUs and $25% in cash. Previously, the annual retainer was payable one-half in cash and one-half in CSUs. The number of CSUs to be granted under the 2004 Fee Plan will be determined by dividing the amount of the annual retainer by an amount equal to 105% of the average of the closing prices for the Company’s common stock on the five trading days preceding the award date (the day after the annual meeting). The annual grant of CSUs will vest in two equal installments, one-half on the date of each of the following two annual shareholders’ meetings.
      All CSUs will automatically vest upon the termination of a Director’s service as a Director, whether by reason of death, retirement, resignation, removal or failure to be reelected at the end of his or her term. Until a CSU vests, the Director has none of the rights of a shareholder with respect to the CSU or the common stock underlying the CSU. CSUs are not transferable.
      The maximum number of CSUs and shares of the Company’s common stock which can be issued under the 2004 Fee Plan is 450,000. The Board of Directors has the ability to amend or terminate the Plan as it deems appropriate. However, no such amendment may be made without shareholder approval if such approval would be required to comply with any applicable law or the listing standards of the stock exchange on which the Company’s shares are listed or traded. The adoption of the 2004 Fee Plan does not limit the ability of the Board to provide for additional compensation payable to non-employee Directors for services on behalf of the Board over and above those typically expected of Directors, including serving as Chair of a Board committee.
      On May 8, 2004, Iain Macdonald, who was newly elected to the Board at the 2004 annual meeting, received an award of 4,822 CSUs under the 2004 Fee Plan for his initial grant of $30,000 worth of CSUs upon joining the Board, as well as an award of 6,315 CSUs for the $37,500 worth of CSUs payable as part of his annual retainer of $50,000 for the coming year. Mr. Macdonald’s 4,822 CSUs relating to his initial award will vest in three equal installments on the dates of the 2005, 2006 and 2007 annual meetings. His 6,315 CSUs relating to his annual retainer award will vest in two equal installments on the dates of the 2005 and 2006 annual meetings.
      Also on May 8, 2004, each of the nine non-employee Directors who had been serving on the board prior to the 2004 annual meeting received an award of 4,942 CSUs for $29,349 of their annual retainer of $50,000 for the coming year. This amount is net of the portion of the $25,000 annual retainer paid to these non-employee Directors in CSUs in January 2004 under the 1996 Non-Employee Director Fee Plan, which was in effect until the adoption of the 2004 Fee Plan. Under the 1996 Plan, the annual retainer was paid in advance at the beginning of each calendar year; therefore, a portion of the $12,500 paid to these Directors in January in CSUs, equal to the number of days from May 8, 2004 to December 31, 2004, was applied against the $37,500

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worth of CSUs payable under the 2004 Fee Plan on May 8, 2004. These additional CSUs will vest in two equal installments on the dates of the 2005 and 2006 annual meetings.
      In all, an aggregate of 55,615 CSUs were awarded to the non-employee Directors on May 8, 2004, under the 2004 Fee Plan.
      If the 2004 Fee Plan is not approved by the shareholders at the Annual Meeting, the non-employee Directors will receive the fees provided under the 1996 Fee Plan (subject to the increase in the amount of the annual retainer from $25,000 to $50,000) and the stock options provided for in the 2004 Option Plan, beginning with the award each would receive under that plan on the day following the Annual Meeting. In such event, the Board also has indicated that it would grant to each of the nine non-employee Directors who had been serving on the board prior to the 2004 annual meeting an additional award of stock options to make up for the options that otherwise would have been granted under the 2004 Option Plan on the day after the 2004 annual meeting. Such additional option awards would have an exercise price of $5.75, the fair market value of the shares (as defined in the 2004 Option Plan) as of May 8, 2004, and would vest on the date of grant, as the award of stock options that would have been granted under the 2004 Option Plan on the day after the 2004 annual meeting would have vested on May 8, 2005, one year and one day after the date of the 2004 annual meeting. Also, in such event, the Board has indicated that it would grant to Mr. Iain Macdonald, who was first elected to the Board at the 2004 annual meeting, an additional award of stock options to make up for the options that otherwise would have been granted to him under the 2004 Option Plan on the day of the 2004 annual meeting. Such options would have an exercise price of $5.66, the fair market value of the shares (as defined in the 2004 Option Plan) as of May 7, 2004, and would vest one-third on the date of grant, one-third on May 7, 2006 and one-third on May 7, 2007, as the award of stock options that would have been granted to him the 2004 Option Plan on the day of the 2004 annual meeting would have become exercisable in equal thirds on the first three anniversaries of the date of the 2004 annual meeting.
      A copy of the 2004 Fee Plan is attached to this proxy statement as Appendix A.
The Board of Directors recommends the approval of the Plan and urges each shareholder to vote “FOR” the Plan. Executed proxies in the accompanying form will be voted at the Annual Meeting in favor of the adoption of the amendment unless the proxy is marked otherwise.
PROPOSAL 3:
ACCELERATION OF CERTAIN NON-EMPLOYEE DIRECTOR STOCK OPTIONS
      On February 1, 2005, the Compensation Committee of the Board of Directors approved accelerating the vesting of most out-of-the-money, unvested stock options held by current employees, including executive officers, and certain employee Directors. An option was considered out-of-the-money if the stated option exercise price was greater than the closing price, $7.23, of the Company’s common stock on the day the Compensation Committee approved the acceleration. With respect to all such stock options, the accelerated vesting was effective as of February 1, 2005. Holders of incentive stock options (within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended) and certain foreign employees were given the opportunity to decline the accelerated vesting in order to prevent changing the status of the incentive stock option for federal income tax purposes to a non-qualified stock option or the restriction of the availability of favorable tax treatment under applicable foreign law.
      Additionally, with respect to out-of-the-money, unvested stock options automatically granted to non-employee Directors when they were first elected to the Board and each year thereafter under the 1996 Option

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Plan, the Compensation Committee approved the acceleration of all such options effective as of the date of the Annual Meeting, subject to the approval of such accelerated vesting by the shareholders at the Annual Meeting.
      The decision to accelerate vesting of these options and eliminate future compensation expense was based on a review of the Company’s long-term incentive programs in light of current market conditions and changing accounting rules regarding stock option expensing that the Company must follow beginning January 1, 2006. This accounting rule, entitledStatement of Financial Accounting Standards No. 123 (Revised 2004), Share-Based Payment(“SFAS 123R”), will require that compensation cost related to share-based payment transactions, including stock options, be recognized in the financial statements. It is estimated that the maximum future compensation expense that will be charged to earnings, absent the acceleration of these options, based on the Company’s implementation date for SFAS 123R of January 1, 2006, will be approximately $82,197.
      The following table summarizes the options subject to acceleration for each non-employee Director:
             
  Number of Options    
  Granted That    
  Would Have Date of  
  Vested in the Original Exercise
Name Future Vesting Price
       
Bozek, Mark C  8,332*  08/04/2006  $5.890 
DeLong, Michael  8,332   09/15/2006  $7.736 
Loetz, Gordon H  8,300   03/08/2006  $9.200 
Whiting, Paul L  8,332   12/10/2006  $8.732 
      *These options will not be accelerated if they are in-the-money on the date of the Annual Meeting.
      The 1996 Option Plan is described below under the heading “Board of Directors — “Directors’ Compensation.”
The Board of Directors recommends the approval of the accelerated vesting of these stock options and urges each shareholder to vote “FOR” the accelerated vesting. Executed proxies in the accompanying form will be voted at the Annual Meeting in favor of the accelerated vesting unless the proxy is marked otherwise.
INDEPENDENT PUBLIC ACCOUNTANTS
      The Audit Committee engaged Deloitte & Touche LLP as the Company’s principal accountant to audit the 2004 consolidated financial statements of the Company for the year ended December 31, 2004.
      The fees charged by Deloitte & Touche LLP for professional services rendered in connection with all audit and non-audit related matters for the year ended December 31, 2004 and December 31, 2003 were as follows:
         
  2004 2003
     
Audit Fees(1)
 $3,382,999(2) $1,000,663 
Audit-Related Fees(3)
 $18,413  $674,451(4)
Tax Fees(5)
 $245,292  $451,379 
All Other Fees $-0-  $-0- 

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(1) Fees for audit services in 2004 and 2003 consisted of (a) audits of the Company’s annual consolidated financial statements, (b) reviews of the Company’s quarterly condensed consolidated financial statements and (c) annual stand alone statutory audits.
(2) Fees for audit services billed in 2004 also included advisory services relating to the audit of the Company’s internal control over financial reporting
(3) Fees for audit related services in 2004 and 2003 consisted of (a) audit of employee benefit plans and (b) agreed upon procedures engagements.
(4) Fees for audit related services billed in 2003 also consisted of: (a) SAS 70 and ISO information system reviews, and (b) Sarbanes-Oxley Act, Section 404 advisory services
(5) Fees for tax services consisted of tax compliance and tax consulting services.
      As of the date of this Proxy Statement, the Audit Committee has not engaged a firm of independent public accountants to audit and report on the financial statements of the Company for the year ended December 31, 2005. The Audit Committee anticipates that it will engage Deloitte & Touche LLP for such audit work; however, Deloitte & Touche has not yet provided the Committee with an Audit Plan for 2005 or a final draft of an engagement letter with a final fee quote for such work. Representatives of Deloitte & Touche are expected to be present at the Annual Meeting. Those representatives will have the opportunity to make a statement if they so desire and are expected to be available to respond to appropriate questions.
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors
      The Audit Committee’s policy is to pre-approve all audit and permissible non-audit services provided by the independent auditors. These services may include audit services, audit-related services, tax services and other services. Pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is generally subject to a specific budget. The independent auditors and management are required to periodically report to the Audit Committee regarding the extent of services provided by the independent auditors in accordance with this pre-approval, and the fees for the services performed to date. The Audit Committee may also pre-approve particular services on a case-by-case basis.
Report of the Audit Committee
      The Audit Committee consists of three non-employee directors, William J. Meurer, as chairman, Iain A. Macdonald, and Paul L. Whiting. The Committee oversees the Company’s financial reporting process on behalf of the Board of Directors. Management has the primary responsibility for the financial statements and the reporting process including the systems of internal controls. In fulfilling its oversight responsibilities, the Audit Committee reviewed the audited financial statements in the Annual Report with management, including a discussion of the quality, not just the acceptability, of the accounting principles, the reasonableness of significant judgments, and the clarity of disclosures in the financial statements.
      The Audit Committee reviewed with the independent auditors, who are responsible for expressing an opinion on the conformity of those audited financial statements with generally accepted accounting principles, their judgments as to the quality, not just the acceptability, of the Company’s accounting principles and such other matters as are required to be discussed with the Committee under generally accepted auditing standards. The Company’s independent accountants provided to the Audit Committee the written disclosure required by Independence Standards Board Standard No. 1, “Independence Discussions with Audit Committees,” as

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modified or supplemented. In addition, the Audit Committee has discussed with the independent auditors the auditors’ independence from management and the Company, including the matters in the written disclosures required by the Independence Standards Board, and considered compatibility of non-audit services with the auditors’ independence.
      The Audit Committee discussed with the independent accountants matters required to be discussed by Statement on Auditing Standards No. 61, “Communication with Audit Committees,” as modified or supplemented. The Audit Committee also discussed with the Company’s internal and independent auditors the overall scope and plans for their respective audits. The Committee meets with the internal and independent auditors, with and without management present, to discuss the results of their examinations, their evaluations of the Company’s internal controls, and the overall quality of the Company’s financial reporting. The Audit Committee held 10 meetings during 2004.
      In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Company’s Board of Directors, and the Board has approved, the inclusion of the audited financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004, to be filed with the Securities and Exchange Commission.
AUDIT COMMITTEE
William J. Meurer
Iain A. Macdonald
Paul L. Whiting
April 4, 2005
The information contained in this report shall not be deemed to be “soliciting material” or “filed” or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934.
BOARD OF DIRECTORS
Directors’ Compensation
      Directors who are executive officers of the Company receive no compensation for service as members of either the Board of Directors or any committees of the Board.
      Each non-employee Director receives a cash fee of $1,250 per Board and committee meeting attended, and $500 per telephone conference meeting that lasts at least one hour. Chairpersons of Board committees receive $2,000 per committee meeting attended. Directors also received an ad hoc cash fee of $1,000 per day for extra tasks requested by the Chairman of the Board. A non-employee Chairman of the Board receives an additional annual cash fee of $100,000 for such service.
      In addition to the foregoing fees, prior to the approval by the Board of Directors of the 2004 Non-Employee Director Fee Plan (described below) in May 2004, Directors who were not employees of the Company also were compensated under the 1996 Non-Employee Director Fee Plan (the “1996 Fee Plan”). Under the 1996 Fee Plan, each non-employee Director was paid (as of the first business day of each calendar year) an annual fee of $25,000, at least half of which was payable in shares of Sykes common stock based on the fair market value of the common stock on the date of payment and the other half of which, at the election of the Director, was payable in shares of common stock or cash.

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      In addition, under the Amended and Restated 1996 Non-Employee Director Stock Option Plan (the “1996 Option Plan”), non-employee Directors received options to purchase 25,000 shares of common stock upon their initial election to the Board and options to purchase 10,000 shares of common stock annually thereafter. As of the beginning of 2004, the maximum number of options for shares of common stock issuable under the 1996 Option Plan had been reached, and the Board of Directors approved a replacement plan, the 2004 Non-Employee Director Stock Option Plan (the “2004 Option Plan”), subject to shareholder approval at the 2004 annual meeting. The terms and provisions of the 2004 Option Plan were substantially identical to those of the 1996 Option Plan.
2004 Non-Employee Director Fee Plan
      In May 2004, the Board of Directors approved the 2004 Non-Employee Director Fee Plan (the “2004 Fee Plan”), subject to shareholder approval at the 2005 Annual Meeting. The Board determined that the 2004 Fee Plan would replace and supersede the 1996 Non-Employee Director Fee Plan (the “1996 Fee Plan”), and also would be used in lieu of the 2004 Non-Employee Director Stock Option Plan (the “2004 Option Plan”), which was discussed in the Company’s proxy materials for the 2004 annual shareholders’ meeting and approved by the shareholders at the 2004 annual meeting. Therefore, no options have been awarded under the 2004 Option Plan, and none will be awarded under that plan if the 2004 Fee Plan is approved by the shareholders at the Annual Meeting. Compensation of non-employee Directors under the 2004 Fee Plan will be in addition to the cash compensation described above in the second paragraph under the heading “Directors’ Compensation.”
      The 2004 Fee Plan provides that all new non-employee Directors joining the Board will receive an initial grant of common stock units (“CSUs”) on the date the new Director is appointed or elected, the number of which will be determined by dividing a dollar amount to be determined from time to time by the Board (initially set at $30,000) by an amount equal to 110% of the average closing prices of the Company’s common stock for the five trading days prior to the date the new Director is appointed or elected. The initial grant of CSUs will vest in three equal installments, one-third on the date of each of the following three annual shareholders’ meetings. A CSU is a bookkeeping entry on the Company’s books that records the equivalent of one share of common stock. On the date each CSU vests, the Director will become entitled to receive a share of the Company’s common stock and the CSU will be canceled.
      Additionally, the new Plan provides that each non-employee Director who was serving as a Director immediately prior to each annual shareholders’ meeting will receive, on the day after the annual meeting, an annual retainer for service as a non-employee Director, the amount of which shall be determined from time to time by the Board. The Board increased the amount of the annual retainer from $25,000 to $50,000. Under the 2004 Fee Plan, the annual retainer will be paid 75% in CSUs and $25% in cash. Previously, the annual retainer was payable one-half in cash and one-half in CSUs. The number of CSUs to be granted under the 2004 Fee Plan will be determined by dividing the amount of the annual retainer by an amount equal to 105% of the average of the closing prices for the Company’s common stock on the five trading days preceding the award date (the day after the annual meeting). The annual grant of CSUs will vest in two equal installments, one-half on the date of each of the following two annual shareholders’ meetings.
      All CSUs will automatically vest upon the termination of a Director’s service as a Director, whether by reason of death, retirement, resignation, removal or failure to be reelected at the end of his or her term. Until a CSU vests, the Director has none of the rights of a shareholder with respect to the CSU or the common stock underlying the CSU. CSUs are not transferable.

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      On May 8, 2004, Iain Macdonald, who was newly elected to the Board at the 2004 annual meeting, received an award of 4,822 CSUs under the 2004 Fee Plan for his initial grant of $30,000 worth of CSUs upon joining the Board, as well as an award of 6,315 CSUs for the $37,500 worth of CSUs payable as part of his annual retainer of $50,000 for the coming year. Mr. Macdonald’s 4,822 CSUs relating to his initial award will vest in three equal installments on the dates of the 2005, 2006 and 2007 annual meetings. His 6,315 CSUs relating to his annual retainer award will vest in two equal installments on the dates of the 2005 and 2006 annual meetings.
      Also on May 8, 2004, each of the nine non-employee Directors who had been serving on the board prior to the 2004 annual meeting received an award of 4,942 CSUs for $29,349 of their annual retainer of $50,000 for the coming year. This amount is net of the portion of the $25,000 annual retainer paid to these non-employee Directors in CSUs in January 2004 under the 1996 Non-Employee Director Fee Plan, which was in effect until the adoption of the 2004 Fee Plan. Under the 1996 Plan, the annual retainer was paid in advance at the beginning of each calendar year; therefore, a portion of the $12,500 paid to these Directors in January in CSUs, equal to the number of days from May 8, 2004 to December 31, 2004, was applied against the $37,500 worth of CSUs payable under the 2004 Fee Plan on May 8, 2004. These additional CSUs will vest in two equal installments on the dates of the 2005 and 2006 annual meetings.
      In all, an aggregate of 55,615 CSUs were awarded to the non-employee Directors on May 8, 2004, under the 2004 Fee Plan.
      If the 2004 Fee Plan is not approved by the shareholders at the Annual Meeting, the non-employee Directors will receive the fees provided under the 1996 Fee Plan (subject to the increase in the amount of the annual retainer from $25,000 to $50,000) and the stock options provided for in the 2004 Option Plan, beginning with the award each would receive under that plan on the day following the Annual Meeting. In such event, the Board also has indicated that it would grant to each of the nine non-employee Directors who had been serving on the board prior to the 2004 annual meeting an additional award of stock options to make up for the options that otherwise would have been granted under the 2004 Option Plan on the day after the 2004 annual meeting. Such additional option awards would have an exercise price of $5.75, the fair market value of the shares (as defined in the 2004 Option Plan) as of May 8, 2004, and would vest on the date of grant, as the award of stock options that would have been granted under the 2004 Option Plan on the day after the 2004 annual meeting would have vested on May 8, 2005, one year and one day after the date of the 2004 annual meeting. Also, in such event, the Board has indicated that it would grant to Mr. Iain Macdonald, who was first elected to the Board at the 2004 annual meeting, an additional award of stock options to make up for the options that otherwise would have been granted to him under the 2004 Option Plan on the day of the 2004 annual meeting. Such options would have an exercise price of $5.66, the fair market value of the shares (as defined in the 2004 Option Plan) as of May 7, 2004, and would vest one-third on the date of grant, one-third on May 7, 2006 and one-third on May 7, 2007, as the award of stock options that would have been granted to him the 2004 Option Plan on the day of the 2004 annual meeting would have become exercisable in equal thirds on the first three anniversaries of the date of the 2004 annual meeting.
Certain Relationships and Related Transactions
      During the year ended December 31, 2004 the Company paid $591,822 to JHS Leasing of Tampa, Inc., an entity owned by Mr. John H. Sykes, former Chairman of the Board and Chief Executive Officer, for the use of its corporate aircraft.

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Director Independence, Committees of the Board of Directors and Meeting Attendance
      In April, 2005 the Board of Directors undertook a review of Director independence. During this review, the Board considered transactions and relationships between each Director whose term will continue after the Annual Meeting and all of the Directors who have been nominated to stand for election at the Annual Meeting, and members of his or her immediate family and the Company and its subsidiaries and affiliates, including those reported under “Certain Relationships and Related Transactions.” The purpose of this review was to determine whether any relationships or transactions were inconsistent with a determination that a Director is independent within the meaning of the rules of the Nasdaq Stock Market and, for audit committee members, also independent within the meaning of the rules of the Securities and Exchange Commission. The Board determined that other than Mr. Charles Sykes, all of the Directors of the Company whose term will continue after the Annual Meeting, and all of the Directors who have been nominated to stand for election at the Annual Meeting, qualify as independent.
      During 2004, the Board of Directors held 7 meetings. It is our policy to schedule a meeting of the Board on the date of the annual meeting of shareholders and we encourage all of our Directors to attend the annual shareholders’ meeting. Nine Directors attended last year’s annual meeting of shareholders.
      The Board of Directors has the standing committees listed below.
Audit Committee. The Audit Committee serves as an independent and objective party to monitor the Company’s financial reporting process and internal control system. The Committee is responsible for the appointment, compensation, and oversight of the work of the Company’s independent auditing firm, as well as for reviewing the independence, qualifications, and activities of the auditing firm. The Company’s independent auditing firm reports directly to the Committee. All proposed transactions between the Company and the Company’s officers and directors, or an entity in which a Company officer or director has a material interest, are reviewed by the Committee, and the approval of the Committee is required for such transactions. During the year ended December 31, 2004, the Committee held 10 meetings. From January 1, 2004, until the annual shareholders’ meeting in May 2004, the Committee was comprised of Messrs. Meurer, Helms, Whiting and Thomas F. Skelly. Mr. Skelly left the Board at the 2004 annual meeting, and Mr. Helms was replaced by Mr. Macdonald. During the remainder of 2004, and until the Annual Meeting, the Committee was, and will be, comprised of Messrs. Meurer (Chair), Macdonald and Whiting. The Board has determined that Messrs. Meurer, Macdonald and Whiting are independent within the meaning of the rules of the Nasdaq Stock Market and the Securities and Exchange Commission. The Board also has determined that Mr. Meurer is an “audit committee financial expert” within the meaning of the rules of the Securities and Exchange Commission. The Committee is governed by a written charter, which is reviewed on an annual basis. A copy of the current Audit Committee Charter is available on the Company’s website atwww.sykes.com/investors.asp under the heading “Corporate Governance”.
Compensation and Human Resource Development Committee. The Compensation and Human Resource Development Committee is responsible for establishing the compensation of the Company’s senior management, including salaries, bonuses, granting of stock options under the Company’s various stock option plans, termination arrangements, and other executive officer benefits. This Committee is also responsible for providing oversight and direction regarding the Company’s employee health and welfare benefit programs, training and development and succession planning. During 2004, the Committee held 10 meetings. From January 1, 2004, until the annual shareholders’ meeting in May 2004, the Committee was comprised of Mr. Bozek, Dr. McClintock-Greco, Gordon H. Loetz and Ernest J. Milani. Mr. Loetz left the Committee at the 2004 annual meeting. During the remainder of 2004, and until the Annual Meeting, the Committee was,

17

and will be, comprised of Mr. Milani (Chair), Mr. Bozek and Dr. McClintock-Greco. The Board has determined that Messrs. Milani and Bozek and Dr. McClintock-Greco are independent within the meaning of the rules of the Nasdaq Stock Market. Mr. Milani will leave the Board at the Annual Meeting. It is anticipated that, at the first meeting of the Board of Directors following the Annual Meeting, the Board will appoint a third Director to the committee who qualifies as an independent director within the meaning of the rules of the Nasdaq Stock Market.
Nominating and Corporate Governance Committee. The purpose of the Nominating and Corporate Governance Committee is to:
• identify individuals qualified to become members of the Board of Directors of the Company and its subsidiaries;
• recommend to the Board of Directors director nominees for election at the annual meeting of shareholders or for election by the Board of Directors to fill open seats between annual meetings;
• recommend to the Board of Directors committee appointments for directors;
• develop and recommend to the Board of Directors corporate governance guidelines applicable to the Company; and
• monitor the Company’s compliance with good corporate governance standards; and
      In connection with carrying out its responsibility to identify individuals qualified to become members of the Board of Directors, the Committee has developed and recommend to the Board of Directors guidelines and criteria as to the desired qualifications of candidates for nomination for election as a director of the Company. In accordance with our Corporate Governance Guidelines, such criteria include considerations of age, skill, integrity, experience, time availability, appropriate listing standards, and applicable federal and state law and regulation. These guidelines and criteria were approved by the Board have been published in the Company’s quarterly report on Form 10-Q for the second quarter of 2004.
      The Committee may use various sources for identifying and evaluating nominees for Directors including referrals from our current Directors, management and shareholders, as well as input from third party executive search firms retained at the Company’s expense. If the Committee retains one or more search firms, such firms may be asked to identify possible nominees, interview and screen such nominees and act as a liaison between the Committee and each nominee during the screening and evaluation process. The Committee will review the resume and qualifications of each candidate identified through any of the sources referenced above, and determine whether the candidate would add value to the Board. With respect to candidates that are determined by the Committee to be potential nominees, one or more members of the Committee will contact such candidates to determine the candidate’s general availability and interest in serving. Once it is determined that a candidate is a good prospect, the candidate will be invited to meet the full Committee which will conduct a personal interview with the candidate. During the interview, the Committee will evaluate whether the candidate meets the guidelines and criteria adopted by the Board, as well as exploring any special or unique qualifications, expertise and experience offered by the candidate and how such qualifications, expertise and/or experience may compliment that of existing Board members. If the candidate is approved by the Committee, as a result of the Committee’s determination that the candidate will be able to add value to the Board and the candidate expresses his or her interest in serving on the Board, the Committee will then review it’s conclusions with the Board and recommend that the candidate be selected by the Board to stand for election by the shareholders or fill a vacancy or newly created position on the Board.

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      James K. Murray, Jr. and James S. MacLeod, who are being submitted for election as Directors at the Annual Meeting, were both recommended by Mr. Charles Sykes to the members of the Committee.
      The Committee will consider qualified nominees recommended by shareholders who may submit recommendations to the Committee in care of our Corporate Secretary, 400 North Ashley Drive, Tampa, Florida 33602. Any shareholder nominating an individual for election as a director at an annual meeting must provide written notice to the Secretary of the Company, along with the information specified below, which notice must be received at the principal business office of the Company no later than the date designated for receipt of shareholders’ proposals as set forth in the Company’s proxy statement for its annual shareholders’ meeting. If there has been no such prior public disclosure, then to be timely, a shareholder’s nomination must be delivered to or mailed and received at the principal business office of the Company not less than 60 days nor more than 90 days prior to the annual meeting of shareholders; provided, however, that in the event that less than 70 days’ notice of the date of the meeting is given to the shareholders or prior public disclosure of the date of the meeting is made, notice by the shareholder to be timely must be so received not later than the close of business on the tenth day following the day on which such notice of the annual meeting was mailed or such public disclosure was made.
      To be considered by the Committee, shareholder nominations must be accompanied by: (1) the name, age, business and residence address of the nominee; (2) the principal occupation or employment of the nominee for at least the last five years and a description of the qualifications of the nominee; (3) the number of shares of our stock that are beneficially owned by the nominee; and (4) any other information relating to the nominee that is required to be disclosed in solicitations for proxies for election of Directors under Regulation 14A of the Exchange Act, together with a written statement from the nominee that he or she is willing to be nominated and desires to serve, if elected. Also, the shareholder making the nomination should include: (1) his or her name and record address, together with the name and address of any other shareholder known to be supporting the nominee; and (2) the number of shares of our stock that are beneficially owned by the shareholder making the nomination and by any other supporting shareholders. Nominees for Director who are recommended by our shareholders will be evaluated in the same manner as any other nominee for Director.
      We may require that the proposed nominee furnish us with other information as we may reasonably request to assist us in determining the eligibility of the proposed nominee to serve as a Director. At any meeting of shareholders, the Chairman of the Board may disregard the purported nomination of any person not made in compliance with these procedures.
      During the year ended December 31, 2004, the Nominating and Corporate Governance Committee held 5 meetings. During 2004, and until the Annual Meeting, the Committee was and will be comprised of Mr. Bodenheimer, Mr. Helms and Lt. Gen DeLong. The Board has determined that Mr. Bodenheimer, Mr. Helms and Lt. Gen DeLong are independent within the meaning of the rules of the Nasdaq Stock Market. The Committee is governed by a written charter, which is reviewed on an annual basis. A copy of the current Nominating and Corporate Governance Committee Charter is available on the Company’s website atwww.sykes.com/investors.asp under the heading “Corporate Governance”.

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Compensation Committee Interlocks and Insider Participation
None
COMMUNICATIONS WITH OUR BOARD
      Shareholders and other parties interested in communicating with our Board of Directors may do so by writing to the Board of Directors, Sykes Enterprises, Incorporated, 400 N. Ashley Drive, Tampa, Florida 33602. Under the process for such communications established by the Board of Directors, the Vice President and General Counsel of the Company reviews all such correspondence and regularly forwards to all members of the Board a summary of the correspondence. Directors may at any time review a log of all correspondence received by the Company that is addressed to the Board or any member of the Board and request copies of any such correspondence. Correspondence that, in the opinion of the Vice President and General Counsel, relates to concerns or complaints regarding accounting, internal accounting controls and auditing matters is summarized and the summary and a copy of the correspondence is forwarded to the Chair of the Audit Committee. Additionally, at the direction of the Audit Committee, the Company has established a worldwide toll free hotline administered by an independent third party through which employees may make anonymous submissions regarding questionable accounting or auditing matters. Reports of any anonymous submissions are sent to the Chairman of the Audit Committee and the Vice President and General Counsel of the Company.
CORPORATE GOVERNANCE
The Company maintains a corporate governance page on its website which includes key information about its corporate governance initiatives, including its Corporate Governance Guidelines, Code of Ethics, and charters for the committees of the Board of Directors. The corporate governance page can be found atwww.sykes.com/investors.asp,, by clicking on “Corporate Governance.”

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The Company’s policies and practices reflect corporate governance initiatives that are compliant with the listing requirements of the Nasdaq Stock Market and the corporate governance requirements of the Sarbanes-Oxley Act of 2002, including:
 • the Board of Directors has adopted clear corporate governance policies;
 
 • a majority of the board members are independent of the Company and its management;
 
 • all members of the key board committees — the Audit Committee, the Compensation and Human Resource Development Committee and the Nominating and Corporate Governance Committee — are independent;
 
 • the independent members of the Board of Directors meet regularly without the presence of management;
 
 • the Company has adopted a code of ethics that applies to all directors, officers and employees which is monitored by its Nominating and Corporate Governance Committee;
 
 • the charters of the Board committees clearly establish their respective roles and responsibilities; and
 
 • the Company’s Audit Committee has established procedures for the receipt, retention and treatment, on a confidential basis, of complaints received by the Company, including the Board and the Audit Committee, regarding accounting, internal accounting controls or auditing matters, and the confiden-

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tial,confidential, anonymous submissions by employees of concerns regarding questionable accounting or auditing matters. These procedures are described under “Communications With Our Board” above.below.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCECertain Relationships and Related Person Transactions
 During
Review and Approval of Related Person Transactions.
In order to ensure that material transactions and relationships involving a potential conflict of interest for any executive officer or director of the year ended December 31, 2004,Company are in the best interests of the Company, under the Code of Ethics adopted by the Board of Directors for all of our employees and directors, all such conflicts of interest are required to be reported to the Board of Directors, and the approval of the Board of Directors must be obtained in advance for the Company to enter into any such transaction or relationship. Pursuant to the Code, no officer or employee of the Company may, on behalf of the Company, authorize or approve any transaction or relationship, or enter into any agreement, in which such officer or any member of his or her immediate family, may have a personal interest without such Board approval. Further, no officer or employee of the Company may, on behalf of the Company, authorize or approve any transaction or relationship, or enter into any agreement, if they are aware that an executive officer or a director of the Company, or any member of any such person’s family, may have a personal interest in such transaction or relationship, without such Board approval.
The Company’s Audit Committee reviews all conflict of interest transactions involving executive officers and directors of the Company, filed withpursuant to its charter.
In the Securitiescourse of their review of a related party transaction, the Board and Exchange Commission (the “Commission”) on a timely basis all required reports relating to transactions involving equity securities of the Company beneficially owned by them. The Company has relied solely on the written representation of its executive officers and directors and copies of the reports they have filed with the Commission in providing this information.

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PRINCIPAL SHAREHOLDERSAudit Committee considers:
 The following table sets forth certain information regarding the beneficial ownership of Common Stock as of the Record Date with respect to, (i) each of the Company’s directors and nominees, (ii) each of the Company’s executive officers named in the Summary Compensation Table below, (iii) all directors and executive officers of the Company as a group, and (iv) each person known by the Company to own beneficially more than 5% of the Common Stock. Except as otherwise indicated, each of the shareholders listed below has sole voting and investment power over the shares beneficially owned.
         
  Beneficially Owned  
Name Shares Percent
     
John H. Sykes(1)  12,901,475   32.8%
ICM Asset Management, Inc.(2)
James M. Simmons
601 W. Main Avenue, Suite 600
Spokane, WA 99201		  2,497,125     
Dimensional Fund Advisors Inc.(3)
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401		  2,384,530   5.9%
Becker Capital Management, Inc.(4)
1211 SW Fifth Avenue, Suite 2185
Portland, OR 97204		  2,207,250   5.5%
W. Michael Kipphut(5)  238,200   * 
Charles E. Sykes(6)  153,500   * 
Gerry L. Rogers(7)  0   * 
James T. Holder(8)  12,084   * 
Furman P. Bodenheimer, Jr.(9)  122,240   * 
H. Parks Helms(10)  86,153   * 
Linda McClintock-Greco(11)  55,692   * 
William J. Meurer(12)  66,533   * 
Paul L. Whiting(13)  111,318   * 
Michael P. DeLong(14)  10,256   * 
Mark C. Bozek(15)  10,763   * 
James K. Murray, Jr.   8,000   * 
James S. MacLeod  0 �� * 
All directors and executive officers as a group (13) persons  13,776,214   34.25%
 *• Less than 1.0%the nature of the related person’s interest in the transaction;
• the material terms of the transaction, including, without limitation, the amount and type of transaction;
• the importance of the transaction to the Company;
• the importance of the transaction to the related person;


8

 (1)• Represents shares owned by Mr. Sykes through Jopar Investments Limited Partnership, a North Carolina limited partnership in which Mr. Sykes iswhether the sole limited partner andtransaction would impair the sole shareholderjudgment of the limited partnership’s sole general partner. Excludes 7,950 shares owned by Mr. Sykes’ wife, asdirector or executive officer to which Mr. Sykes disclaims beneficial ownership. Mr. Sykes’ business address is P.O. Box 2044, Tampa, Florida 33601-2044.act in the best interests of the Company; and
 
 (2)• All information is based uponany other matters the Schedule 13G filed by ICM Asset Management, Inc. and James M. Simmons, dated February 9, 2005. ICM and Mr. Simmons share voting power over 1,135,325 sharesBoard or Committee deems appropriate.
Any member of the Board or the Audit Committee who has a conflict of interest with respect to a transaction under review may not participate in the deliberations or vote respecting approval of the transaction, provided, however, that such director may be counted in determining the presence of a quorum.
Related Party Transactions.
During the year ended December 31, 2007, the Company paid $161,787 to JHS Leasing of Tampa, Inc., an entity owned by Mr. John H. Sykes, former Chairman of the Board and Chief Executive Officer and current principal shareholder, for the use of its corporate aircraft. The lease of the aircraft is pursuant to a written agreement which has been approved by the Audit Committee and the Board. On a quarterly basis, the Audit Committee reviews a report which provides the details of each use of this aircraft by management, including the business purpose, the passengers, and the destination of each flight as well as the cost to the Company, to determine that each such use is in accordance with Company policy.
Director Independence
In accordance with NASDAQ rules, the Board affirmatively determines the independence of each director and nominee for election as a director in accordance with guidelines it has adopted, which include all elements of independence set forth in the NASDAQ listing standards. In conducting its evaluation of Mr. Whiting, the Board considered the Company’s consulting engagement of Mr. Whiting’s adult son, for which the compensation during each of the past two years has not exceeded $60,000. In conducting its evaluation of Mr. Macdonald, the Board considered the business the Company conducted with Yakara, plc, a company that supplies interactive text response solutions that automate inbound and outbound customer contacts. Mr. Macdonald serves as Chairman of the Board of Yakara, plc. The Board determined that the business conducted with Yakara, plc was not material. The Board has determined that neither of these arrangements are of a level requiring disclosure and do not affect the independence of the subject Board members. Based upon these standards, at its meeting held on March 27, 2008, the Board determined that each of the following non-employee directors is independent and has no relationship with the Company, except as a director and shareholder of the Company:
           
 (1) Paul L. Whiting  (6) Iain A. Macdonald
 (2) F. P. Bodenheimer, Jr.   (7) James S. MacLeod
 (3) Mark C. Bozek  (8) Linda McClintock-Greco, MD
 (4) Lt. Gen. Michael DeLong (Ret.)  (9) William J. Meurer
 (5) H. Parks Helms  (10) James K. Murray, Jr.
In addition, based on such standards, the Board affirmatively determined that Charles E. Sykes is not independent because he is the President and Chief Executive Officer of the Company.
Nominations for Directors
The Nominating and Corporate Governance Committee is responsible for screening potential director candidates and recommending qualified candidates to the Board for nomination. In connection with carrying out its responsibility to identify individuals qualified to become members of the Board of Directors, the Committee has developed and recommend to the Board of Directors guidelines and criteria as to the desired qualifications of candidates for nomination for election as a director of the Company. In accordance with our Corporate Governance Guidelines, such criteria include considerations of age, skill, integrity, experience, time availability, stock exchange listing standards, and applicable federal and state laws and regulations.


9

22

The Committee may use various sources for identifying and evaluating nominees for directors including referrals from our current directors, management and shareholders, as well as input from third party executive search firms retained at the Company’s expense. If the Committee retains one or more search firms, such firms may be asked to identify possible nominees, interview and screen such nominees and act as a liaison between the Committee and each nominee during the screening and evaluation process. The Committee will review the resume and qualifications of each candidate identified through any of the sources referenced above, and determine whether the candidate would add value to the Board. With respect to candidates that are determined by the Committee to be potential nominees, one or more members of the Committee will contact such candidates to determine the candidate’s general availability and interest in serving. Once it is determined that a candidate is a good prospect, the candidate will be invited to meet the full Committee which will conduct a personal interview with the candidate. During the interview, the Committee will evaluate whether the candidate meets the guidelines and criteria adopted by the Board, as well as exploring any special or unique qualifications, expertise and experience offered by the candidate and how such qualifications, expertiseand/or experience may complement that of existing Board members. If the candidate is approved by the Committee, as a result of the Committee’s determination that the candidate will be able to add value to the Board and the candidate expresses his or her interest in serving on the Board, the Committee will then review its conclusions with the Board and recommend that the candidate be selected by the Board to stand for election by the shareholders or fill a vacancy or newly created position on the Board.
The four Class I directors whose terms expire at the Annual Meeting have all been nominated by the Committee to stand for re-election.
The Committee will consider qualified nominees recommended by shareholders who may submit recommendations to the Committee in care of our Corporate Secretary, 400 North Ashley Drive, Tampa, Florida 33602. Any shareholder nominating an individual for election as a director at an annual meeting must provide written notice to the Secretary of the Company, along with the information specified below, which notice must be received at the principal business office of the Company no later than the date designated for receipt of shareholders’ proposals as set forth in the Company’s proxy statement for its annual shareholders’ meeting. If there has been no such prior public disclosure, then to be timely, a shareholder’s nomination must be delivered to or mailed and received at the principal business office of the Company not less than 60 days nor more than 90 days prior to the annual meeting of shareholders; provided, however, that in the event that less than 70 days notice of the date of the meeting is given to the shareholders or prior public disclosure of the date of the meeting is made, notice by the shareholder to be timely must be so received not later than the close of business on the tenth day following the day on which such notice of the annual meeting was mailed or such public disclosure was made.
To be considered by the Committee, shareholder nominations must be accompanied by: (1) the name, age, business and residence address of the nominee; (2) the principal occupation or employment of the nominee for at least the last five years and a description of the qualifications of the nominee; (3) the number of shares of our stock that are beneficially owned by the nominee; and (4) any other information relating to the nominee that is required to be disclosed in solicitations for proxies for election of directors under Regulation 14A of the Exchange Act, together with a written statement from the nominee that he or she is willing to be nominated and desires to serve, if elected. Also, the shareholder making the nomination should include: (1) his or her name and record address, together with the name and address of any other shareholder known to be supporting the nominee; and (2) the number of shares of our stock that are beneficially owned by the shareholder making the nomination and by any other supporting shareholders. Nominees for director who are recommended by our shareholders will be evaluated in the same manner as any other nominee for director.
We may require that the proposed nominee furnish us with other information as we may reasonably request to assist us in determining the eligibility of the proposed nominee to serve as a director. At any meeting of


10

shareholders, the Chairman of the Board may disregard the purported nomination of any person not made in compliance with these procedures.
Communications with our Board
Shareholders and other parties interested in communicating with our Board of Directors may do so by writing to the Board of Directors, Sykes Enterprises, Incorporated, 400 N. Ashley Drive, Tampa, Florida 33602. Under the process for such communications established by the Board of Directors, the Senior Vice President and General Counsel of the Company reviews all such correspondence and regularly forwards to all members of the Board a summary of the correspondence. Directors may at any time review a log of all correspondence received by the Company that is addressed to the Board or any member of the Board and request copies of any such correspondence. Correspondence that, in the opinion of the Senior Vice President and General Counsel, relates to concerns or complaints regarding accounting, internal accounting controls and auditing matters is summarized and the summary and a copy of the correspondence is forwarded to the Chairman of the Audit Committee. Additionally, at the direction of the Audit Committee, the Company has established a worldwide toll free hotline administered by an independent third party through which employees may make anonymous submissions regarding questionable accounting or auditing matters. Reports of any anonymous submissions are sent to the Chairman of the Audit Committee and the Senior Vice President and General Counsel of the Company.
MEETINGS AND COMMITTEES OF THE BOARD
The Board
Each director is expected to devote sufficient time, energy and attention to ensure diligent performance of his or her duties and to attend all Board, committee and shareholders’ meetings. The Board met seven times during 2007, of which four were regularly scheduled meetings and three were unscheduled meetings. All directors attended at least 75% of the meetings of the Board and of the committees on which they served during the fiscal year ended December 31, 2007. All of the directors attended the 2007 Annual Meeting of Shareholders on May 24, 2007.
Committees of the Board
The Board has three standing committees to facilitate and assist the Board in the execution of its responsibilities. The Board may also establish special committees as needed to assist the Board with review and consideration of non-routine matters. The standing committees are the Audit Committee, the Compensation and Human Resource Development Committee and the Nominating and Corporate Governance Committee. In accordance with NASDAQ Stock Market and Securities and Exchange Commission requirements, all the committees are comprised solely of non-employee, independent directors. Charters for each committee are available on the Company’s website atwww.sykes.com by first clicking on “Investors” and then on “Corporate Governance.” The charter of each committee is also available in print to any shareholder who requests it. The table below shows membership for the entire year 2007 for each of the standing Board committees.
 
Audit
Nominating and share dispositive power over 2,497,125 shares. ICM is a registered investment adviser whose clients have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the stock. James M. Simmons is the PresidentCorporate
Compensation and controlling shareholder of ICM Asset Management, Inc. No individual client’s holdings of the stock are more than five percent of the outstanding stock.Human Resource
CommitteeGovernance CommitteeDevelopment Committee
 
William J. Meurer, Chair(3) All information is based upon the Schedule 13G filed by Dimensional Fund Advisors Inc., dated February 9, 2005. Dimensional, an investment advisor registered under Section 203 of the Investment Advisors Act of 1940, furnishes investment advice to four investment companies registered under the Investment Company Act of 1940, and serves as investment manager to certain other commingled group trusts and separate accounts. These investment companies, trusts and accounts are the “Funds.” In its role as investment advisor or manager, Dimensional possesses investment and/or voting power over the stock that are owned by the Funds, and may be deemed to be the beneficial owner of the stock held by the Funds. However, all securities are owned by the Funds, no one of which, to the knowledge of Dimensional, owns more than 5% of the class. Dimensional disclaims beneficial ownership of the stock.H. Parks Helms, ChairMark C. Bozek, Chair
Iain A. MacdonaldDr. Linda McClintock-GrecoJames K. Murray, Jr.
Paul L. WhitingFurman P. Bodenheimer, Jr.James S. MacLeod
 (4) All information is based upon the Schedule 13G filed by Becker Capital Management, Inc., dated February 4, 2005. Becker Capital Management has sole voting power over 1,974,450 shares and sole dispositive power over 2,207,250 shares. All securities reported on the schedule are owned by advisory clients of Becker Capital Management, Inc. Becker Capital Management disclaims beneficial ownership of all such securities.Lt. Gen. Michael P. DeLong (Ret)
 (5) Includes 235,000 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.
(6) Includes 153,500 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.
(7) Includes 75,000 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.
(8) Includes 8,334 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.
(9) Includes 60,000 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.
(10) Includes 52,500 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.
(11) Includes 45,000 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.
(12) Includes 42,500 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.
(13) Includes 8,334 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date. Excludes 300 shares owned by Mr. Whiting’s wife, as to which Mr. Whiting disclaims beneficial ownership.
(14) Includes 8,334 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.
(15) Includes 8,334 shares of Sykes Common Stock issuable upon the exercise of stock options that are exercisable within 60 days of the Record Date.


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23

EXECUTIVE COMPENSATION
Audit Committee.  The following table sets forth certain informationAudit Committee serves as an independent and objective party to monitor the Company’s financial reporting process and internal control system. The Committee’s responsibilities, which are discussed in detail in its charter, include, among other things, the appointment, compensation, and oversight of the work of the Company’s independent auditing firm, as well as reviewing the independence, qualifications, and activities of the auditing firm. The Company’s independent auditing firm reports directly to the Committee. All proposed transactions between the Company and the Company’s officers and directors, or an entity in which a Company officer or director has a material interest, are reviewed by the Committee, and the approval of the Committee is required for such transactions. During the yearsyear ended December 31, 2004, 2003, and 2002 concerning compensation paid to or earned by2007, the Company’s “named executive officers,” as defined byCommittee held nine meetings. The Board has determined that Mr. Meurer is an “audit committee financial expert” within the meaning of the rules of the Securities and Exchange Commission,Commission. The Committee is governed by a written charter, which is reviewed on an annual basis. A copy of the current Audit Committee Charter is available on the Company’s website atwww.sykes.com by first clicking on “Investors” and then on “Corporate Governance.”
Nominating and Corporate Governance Committee.  The purpose of the Nominating and Corporate Governance Committee is to: (a) identify individuals qualified to become members of the Board of Directors of the Company and its subsidiaries; (b) recommend to the Board of Directors director nominees for election at the annual meeting of shareholders or for election by the Board of Directors to fill open seats between annual meetings; (c) recommend to the Board of Directors committee appointments for directors; (c) develop and recommend to the Board of Directors corporate governance guidelines applicable to the Company; and (d) monitor the Company’s compliance with good corporate governance standards. During the year ended December 31, 2004.2007, the Nominating and Corporate Governance Committee held four meetings. The Committee is governed by a written charter, which is reviewed on an annual basis. A copy of the current Nominating and Corporate Governance Committee Charter is available on the Company’s website at www.sykes.com by first clicking on “Investors” and then on “Corporate Governance.”
Compensation and Human Resource Development Committee.  The Compensation and Human Resource Development Committee’s responsibilities, which are discussed in detail in its charter, include, among other things, the establishment of the base salary, incentive compensation and any other compensation for the Company’s President and Chief Executive Officer, and to review and approve the President and Chief Executive Officer’s recommendations for the compensation of certain executive officers reporting to him. This Committee also monitors the Company’s management incentive cash and equity based bonus compensation arrangements and other executive officer benefits, and evaluates and recommends the compensation policy for the directors to the full Board for consideration. The Committee also determines compensation and benefits of the Company’s non-employee directors. The Company engaged Mercer Human Resource Consulting to conduct a review of its total compensation program for executive officers and to assist the Committee in establishing a competitive compensation program for its executive officers that motivates performance and that is aligned with the interests of its shareholders. This Committee is also responsible for providing oversight and direction regarding the Company’s employee health and welfare benefit programs as well as training and development. During 2007, the Committee held six meetings. The Committee is governed by a written charter, which is reviewed on an annual basis. A copy of the current Compensation and Human Resource Development Committee Charter is available on the Company’s website at www.sykes.com by first clicking on “Investors” and then on “Corporate Governance.”
Compensation Committee Interlocks and Insider Participation
None


12

EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
Overview of Compensation Program
The Compensation and Human Resource Development Committee (referred to in this Analysis as the “Committee”) of the Board has been charged with the responsibility for establishing, implementing and continually monitoring adherence with the Company’s compensation philosophy. The Committee’s goal is to ensure that the form and amount of compensation and benefits paid to its senior leadership team, specifically including the named executive officers, is fair, reasonable and sufficiently competitive to attract and maintain high quality executives who can lead the Company to achieve the goals that the Board believes will maximize shareholder value. Executive compensation matters are first considered by the Committee, which then makes recommendations to the Board, which then considers and approves or disapproves the Committee’s recommendations. As it relates to the compensation of the Company’s CEO, the Committee meets first with the CEO to obtain information regarding performance, objectives and expectations, discusses the matter with the Board and then makes a final compensation determination.
Compensation Philosophy and Objectives
The Committee believes that the most effective executive compensation program is one that is designed to enhance shareholder value by attracting and retaining the talent and experience best suited to manage, guide and build our business. This requires fair and competitive base salaries and benefits designed to attract qualified executives, as well as carefully designed bonus compensation strategies designed to link the interests of the executives to the long-term interests of our shareholders. In evaluating and determining the complete compensation packages for the Company’s executive officers generally, and the named executive officers specifically, the Committee reviews relevant market data provided by its consultant which includes an evaluation of the multiple components of the executive compensation and benefit packages paid to similarly situated executives of similarly situated peer companies. The Committee believes that the incentive bonus component of the executive compensation program has the potential to significantly influence the achievement of strategic goals of the Company, but to do that, must be carefully designed with those goals in mind. The Committee believes that this is best accomplished by rewarding the Company’s executives with a combination of cash and a meaningful component of stock-based compensation for the Company’s achievement of specific and pre-determined annual, long-term and strategic goals, and to withhold payment of that component of compensation if those goals are not achieved.
Setting Executive Compensation
Based on the foregoing objectives, the Committee has structured the Company’s annual and long-term incentive-based cash and non-cash executive compensation program to motivate executives to achieve the business goals set by the Company and reward the executives for achieving those goals. The Committee meets on at least an annual basis with the Chief Executive Officer and representatives of Human Resources which together recommends a compensation outline for the executive management team other than the Chief Executive Officer. In furtherance of these goals, the Committee engaged Mercer Human Resource Consulting, a division of Marsh & McLennan Companies (“Mercer”), to conduct a review of its total compensation program for all executive officers specifically including the President and Chief Executive Officer and the Chief Financial Officer as well as the other named executive officers. Mercer provided the Committee with relevant market data and alternatives to consider when making compensation decision for the President and Chief Executive Officer, and on the recommendations being made by management for executives other than the President and Chief Executive Officer.


13

In making its compensation decisions for 2007, the Committee compared each element of total compensation against a peer group of ten (10) other publicly traded companies which the Committee believes compete with the Company in the customer contact management segment and for executive talent as well (the “Compensation Peer Group”). The composition of the Compensation Peer Group will be reviewed annually to determine whether there are new companies which should be added, or existing companies which should be deleted. The other companies included in the Compensation Peer Group and used as the basis for comparison and analysis by the Committee for fiscal year 2007 were:


•   PeopleSupport, Inc. 
•   StarTek, Inc.
•   Keane, Inc. •   TechTeam Global, Inc.
•   Affiliated Computer Services, Inc. •   Alliance Data Systems
•   Convergys Corporation•   TeleTech Holdings, Inc.
•   ICT Group, Inc. •   APAC Customer Services, Inc.
As a result of the Committee’s belief that incentive compensation for its executives should be directly related to the Company’s performance, the Committee requested that Mercer perform a comparison of 7 specific performance metrics of the Company against the Compensation Peer Group. The performance metrics measured were(a) 1-year sales growth,(b) 1-year diluted earnings per share growth,(c) 1-year free cash flow growth, (d) EBITDA margin, (e) operating income margin, (f) net profit margin, and(g) 3-year annualized total shareholder return. Based upon fiscal year end 2006 figures, the Company exceeded the Compensation Peer Group performance at the 50th percentile in six (6) of the seven (7) measured metrics. At the 75th percentile, the Company exceeded the Compensation Peer Group performance in two (2) of the seven (7) measured metrics. Based upon the measures and weightings used by Mercer in its analysis, the Company ranked third in overall performance out of all companies in the Compensation Peer Group.
When comparing aggregate total cash compensation paid by the Company in 2006 to its top five (5) highest paid proxy-named executive officers to that paid by the Compensation Peer Group, the Company ranked third (3rd) out of the eleven. Current salaries of the Company’s named executive officers, and the entire executive management team, are at the 50th percentile of the Compensation Peer Group. When comparing aggregate total direct compensation paid by the Company in 2006 to its top five (5) highest paid proxy-named executive officers to that paid by the Compensation Peer Group, the Company ranked fourth (4th) out of the eleven.
The Committee believes that it should generally set compensation of its executives in the general range of 80% to 120% of the 50th percentile of compensation paid to similarly situated executives of the companies comprising the Compensation Peer Group. However, variations from this objective may occur as dictated by the experience level of the individual and other market factors. The Committee recognizes, however, that long – term, equity incentive compensation awards may lift the total direct compensation of its executives above the 50th percentile of the Compensation Peer Group, but if that occurs, it will be as a result of the Company’s achievement of long term goals specifically targeted at increasing shareholder value.
A significant percentage of total compensation to our senior executives is allocated to performance-based incentives as a result of the philosophy mentioned above. There is no pre-established policy or target for the allocation between either cash and non-cash or short-term and long-term performance-based incentive compensation. Rather, the Committee reviewed the recommendations provided by Mercer based upon the peer group and industry standards, together with of each of the senior executive’s existing compensation and performance as relayed by the Chief Executive Officer, and requested that Mercer re-evaluate its recommendations based upon


14

comments and suggestions from the Committee. The revised recommendations of Mercer ultimately formed the basis of the Committee’s senior executive compensation structure for 2007. Income from such incentive compensation is realized as a result of the performance of the Company or the individual, depending on the type of award, compared to established goals. During the three (3) years prior to 2006, the compensation granted by the Committee to our senior executives was almost exclusively in the form of cash. Beginning in 2006, the Committee determined that to be effective over the long term, the compensation policy of the Company must require that a significant portion of total direct compensation be in the form of long-term equity incentive grants and, therefore, a significant percentage of total direct compensation to our executive officers in fiscal year 2007 was in the form of non-cash, long-term equity incentive awards.
Elements of Compensation
The current compensation program for our executives includes several direct compensation components. Those components are base salary, annual cash incentive awards and equity-based incentive awards, which are currently granted in the form of performance — based restricted stock (or restricted stock units), time-vested restricted stock and stock appreciation rights. Our executives are also permitted to participate in our 401(k) plan which is available to all employees, as well as our non-qualified executive deferred compensation plan. The purpose of the deferred compensation plan is to provide our executives with the ability to take advantage of tax deferred savings which may not be fully available to them under our 401(k) plan.
Base Salary
Base salary is designed to provide each executive with a fixed amount of annual compensation that is competitive with the marketplace. Having a certain level of fixed compensation provides stability which allows our executives to remain focused on business issues. Base salaries for the named executive officers are determined for each executive based on his or her position and responsibility by using market data provided to the Committee by Mercer. Base salary ranges of our executives are designed so that salary opportunities for a given position will be between 80% and 120% of the midpoint of the base salaries of similarly positioned executives in the Compensation Peer Group. During its review of base salaries for executives, the Committee primarily considers (a) the market data provided by Mercer, (b) internal review of the executive’s compensation, both individually and relative to other officers, and (c) individual performance of the executive. Salary levels are typically considered annually as part of the Company’s performance review process as well as upon a promotion or other change in job responsibility. Merit based increases to salaries of our executive leadership team, other than the President and Chief Executive Officer, are based on the Committee’s assessment of the individual’s performance, with input from the President and Chief Executive Officer.
Performance-Based Annual Cash Incentive Compensation
The annual cash incentive component of the total direct compensation paid to our executive leadership team is designed to award achievement of pre-determined annual corporate, and sometimes individual, performance goals. The annual incentive awards are designed to reward current performance by basing payment on the achievement of quantifiable performance measures that reflect contributions to the success of our business. The annual incentive program is intended to encourage actions by the executives that contribute directly to our operating and financial results. In fiscal year 2007, the annual cash incentive component of total direct compensation paid to the President and Chief Executive Officer, and all other executive officers, (except for the Senior Vice President, General Counsel and Secretary and the Senior Vice President of Real Estate), was determined based solely upon the achievement of pre-determined corporate financial goals. The annual cash incentive component of total direct compensation paid to


15

the Senior Vice President, General Counsel and Secretary was determined based 50% upon the achievement of pre-determined corporate financial goals, and 50% upon the achievement of pre-determined individual performance goals. The annual cash incentive component of total direct compensation paid to the Senior Vice President, Real Estate was based solely upon the achievement of pre-determined individual performance goals.
At the beginning of the year, the Committee sets minimum, target and maximum levels for the portion of the cash incentive component of total direct compensation that is determined by reference to corporate financial performance. Threshold performance represents the minimum performance that still warrants incentive recognition for that particular goal, and is paid at 50% of the target award level. Maximum performance represents the highest level likely to be attained and is paid at 150% of the target award level. No annual performance based cash incentive compensation determined by reference to corporate financial performance is paid to any executive of the Company if our financial results do not exceed the threshold determined for that year. At the beginning of each year, the Committee also sets the award percentage tied to salary for the President and Chief Executive Officer and recommends an award percentage for each of the other members of the executive leadership team that they will receive if the performance goals are met. The Committee’s goal in setting target award levels is to create a compensation program such that the potential incentive awards, when combined with each officer’s base salary, will provide a fully competitive total cash compensation opportunity, with the portion of compensation “at risk” (i.e., the target award level) being reflective of the level of that officer’s accountability for contributing to bottom line financial results, and the degree of influence that officer has over results. In setting these percentages, the Committee considers these factors as well as data from the market assessment provided by Mercer. In 2007, the target award percentages were set at 75% of base salary for the President and Chief Executive Officer, 60% of base salary for the Chief Financial Officer, and between 30% and 50% of base salary for each of the other named executive officers and members of the executive leadership team.
For fiscal year 2007, the Committee established the target financial goal of the Company on which the annual performance based cash incentive compensation awards would be based as $40,670,000 of consolidated earnings before taxes. The amount each named executive officer received in 2007 under our annual performance based cash incentive compensation program has been reported in the Summary Compensation Table in the Non-Equity Incentive Compensation column. In years prior to 2006, these amounts were reported under the bonus column of the predecessor to the Summary Compensation Table.
Each of the named executive officers for the fiscal year ended December 31, 2007, received the following payments in March 2008 as payment of the annual cash performance bonus earned for fiscal year 2007 performance.
     
  2007 Annual Cash
Name
 Performance Bonus
 
Charles E. Sykes $468,750 
W. Michael Kipphut $276,375 
James C. Hobby $190,625 
Lawrence R. Zingale $190,625 
David L. Pearson $132,452 
Performance-Based, Long-Term, Equity Incentive Compensation
The long-term, performance-based equity incentive compensation component of total direct compensation for our executives is designed to encourage them to focus on long-term Company performance and provides an opportunity for executive officers and certain designated key employees to increase their stake in the Company


16

through grants of the Company’s common stock based on a three-year performance cycle. The Committee currently utilizes a combination of restricted stock (or restricted stock units for executives and key employees in foreign countries who would suffer unfavorable tax consequences due to local tax laws if they were to receive restricted stock) and stock appreciation rights (“SARs”). The Company has not issued stock options since 2003. By using a mix of restricted stock and SARs, the Company is able to compensate executives for sustained increases in the Company’s stock performance. The restricted stock component is only earned when certain Company financial performance goals are attained, and the full value is maximized when the value of the Company’s stock increases. The SARs awarded to executive officers represent the right to receive, on the specified dates, that number of shares of the Company’s common stock determined by dividing (i) the total number of shares of stock subject to the SAR being exercised by the Participant, multiplied by the amount by which the fair market value of a share of the Company’s common stock on the day the right is exercised exceeds the fair market value of a share of the Company’s common stock on the date of grant of the SAR (the “Spread”), by (ii) the fair market value of a share of the Company’s common stock on the exercise date. The Committee believes both of these components of performance-based long-term equity incentive compensation directly align the interests of the Company’s executives with the interests of its shareholders. The Committee’s goal in setting target long-term equity incentive award levels is to create a complete compensation program, such that the potential annual cash and long-term equity incentive awards, when combined with each officer’s base salary, will provide a fully competitive total compensation opportunity, with there being a significant portion of potential compensation “at risk.” In setting award percentages (which are tied to salary), the Committee considers the level of each officer’s accountability for contributing to bottom line financial results, and the degree of influence that officer has over results, as well as data from the market assessment provided by Mercer. The Committee first utilized this method for determining long-term incentive compensation on a three-year performance cycle for the performance cycle beginning January 1, 2005.
2005 through 2007 Performance Cycle.  In May, 2006, the Committee established the target level of Company financial performance for the performance-based long-term equity incentive component of total direct compensation that would be used to determine awards to certain of the named executive officers and other executive officers for the three-year performance cycle beginning on January 1, 2005 and ending on December 31, 2007. For this three-year performance cycle, the awards were only to be paid if the Company reached the established target level of financial performance, and in that event, the payment would be made at 100% of the established awards. There was no opportunity for the participating executives to earn more than that amount under the long-term equity incentive component of compensation for this three-year measurement cycle. For the three-year performance cycle beginning in fiscal year 2005, the Committee made awards of performance-based restricted stock (or restricted stock units, as the case may be) and cash only. The target award percentages were set at 60% of base salary for both the President and Chief Executive Officer and the Chief Financial Officer, and between 35% and 50% of base salary for each of the other named executive officers and members of the executive leadership team. Twenty five (25) percent of the full award value was to be paid in cash to alleviate some of the tax burden associated with the delivery of the stock. The financial targets were achieved and the stock was delivered to the award recipients on April 1, 2008.
2006 through 2008 Performance Cycle.  In May, 2006, the Committee also established minimum, target and maximum Company financial performance levels for the performance-based long-term equity incentive component of total direct compensation that will be used to determine awards to certain of the named executive officers, other executive officers and certain key employees for the three-year performance cycle beginning on January 1, 2006 and ending on December 31, 2008. Threshold performance represents the minimum performance that still warrants incentive recognition for that particular goal, and is paid at 80% of the target award level. Maximum performance represents the highest level likely to be attained and is paid at 150% of the target award level. None of the restricted


17

stock awards will vest and be delivered to any executive of the Company if our financial results do not exceed the threshold determined for that three-year measurement period. For the three-year performance cycle beginning in fiscal year 2006, the Committee made awards of performance-based restricted stock (or restricted stock units as the case may be) and time vesting SARs. The target award percentages for performance based restricted stock were set at 133% of base salary for the President and Chief Executive Officer, 80% of base salary for the Chief Financial Officer, and between 20% and 67% of base salary for each of the other named executive officers, members of the executive leadership team and other key employees. The target award percentages for SARs were set at 67% of base salary for the President and Chief Executive Officer, 40% of base salary for the Chief Financial Officer, and between 20% and 33% of base salary for each of the other named executive officers and members of the executive leadership team. The target goal for two thirds of the performance-based restricted share awards was established by the Committee to be that income from operations of the Company, as reported in its audited Consolidated Statement of Operations, has increased during fiscal years 2006, 2007 and 2008 (measured as of December 31, 2008) at least in an amount equal to 10% compounded annual growth over the amount reported for the 2005 fiscal year. The target goal for one third of the performance-based restricted share awards is that gross revenue from operations of the Company, as reported in its audited Consolidated Statements of Operations, has increased during fiscal years 2006, 2007 and 2008 (measured as of December 31, 2008) at least in an amount equal to 4% compounded annual growth over the amount reported for the 2005 fiscal year. The SAR awards vest in equal one third amounts based upon the executive being employed by the Company on each of March 29, 2007, March 29, 2008 and March 29, 2009.
2007 through 2009 Performance Cycle.  In December, 2006, the Committee established minimum, target and maximum Company financial performance levels for the performance-based long-term equity incentive component of total direct compensation that will be used to determine awards to certain of the named executive officers, other executive officers and certain key employees for the three-year performance cycle beginning on January 1, 2007 and ending on December 31, 2009. Threshold performance represents the minimum performance that still warrants incentive recognition for that particular goal, and is paid at 80% of the target award level. Maximum performance represents the highest level likely to be attained and is paid at 150% of the target award level. None of the restricted stock awards will vest and be delivered to any executive of the Company if our financial results do not exceed the threshold determined for that three-year measurement period. For the three-year performance cycle beginning in fiscal year 2007, the Committee made awards of performance-based restricted stock (or restricted stock units as the case may be) and time vesting SARs. The target award percentages for performance based restricted stock were set at 133% of base salary for the President and Chief Executive Officer, 80% of base salary for the Chief Financial Officer, and between 20% and 67% of base salary for each of the other named executive officers, members of the executive leadership team and other key employees. The target award percentages for SARs were set at 67% of base salary for the President and Chief Executive Officer, 40% of base salary for the Chief Financial Officer, and between 20% and 33% of base salary for each of the other named executive officers and members of the executive leadership team. The target goal for two thirds of the performance-based restricted share awards was established by the Committee to be that income from operations of the Company, as reported in its audited Consolidated Statement of Operations during fiscal years 2007, 2008 and 2009 (measured from January 1, 2007 through December 31, 2009) equals at least $110,210,000. The target goal for one third of the performance-based restricted share awards is that gross revenue from operations of the Company, as reported in its audited Consolidated Statements of Operations (measured from January 1, 2007 through December 31, 2009) equals at least $1,992,000,000. The SAR awards vest in equal one third amounts based upon the executive being employed by the Company on each of March 29, 2008, March 29, 2009 and March 29, 2010.
2008 through 2010 Performance Cycle.  In December, 2007, the Committee established minimum, target and maximum Company financial performance levels for the performance-based long-term equity incentive component of total direct compensation that will be used to determine awards to certain of the named executive officers, other


18

executive officers and certain key employees for the three-year performance cycle beginning on January 1, 2008 and ending on December 31, 2010. Threshold performance represents the minimum performance that still warrants incentive recognition for that particular goal, and is paid at 80% of the target award level. Maximum performance represents the highest level likely to be attained and is paid at 150% of the target award level. None of the restricted stock awards will vest and be delivered to any executive of the Company if our financial results do not exceed the threshold determined for that three-year measurement period. For the three-year performance cycle beginning in fiscal year 2008, the Committee made awards of performance-based restricted stock (or restricted stock units as the case may be) and time vesting SARs. The target award percentages for performance based restricted stock were set at 133% of base salary for the President and Chief Executive Officer, 80% of base salary for the Chief Financial Officer, and between 20% and 67% of base salary for each of the other named executive officers, members of the executive leadership team and other key employees. The target award percentages for SARs were set at 67% of base salary for the President and Chief Executive Officer, 40% of base salary for the Chief Financial Officer, and between 20% and 33% of base salary for each of the other named executive officers and members of the executive leadership team. The target goal for two thirds of the performance-based restricted share awards was established by the Committee to be that income from operations of the Company, as reported in its audited Consolidated Statement of Operations, during fiscal years 2008, 2009 and 2010 (measured from January 1, 2008 through December 31, 2010) equals at least $183,720,000. The target goal for one third of the performance-based restricted share awards is that gross revenue from operations of the Company, as reported in its audited Consolidated Statements of Operations during fiscal years 2008, 2009 and 2010 (measured from January 1, 2008 through December 31, 2010) equals at least $2,388,953,000. The SARs awards vest in equal one third amounts based upon the executive being employed by the Company on each of January 2, 2009, January 2, 2010 and January 2, 2011.
The amount each named executive officer received in 2007 as performance-based long-term equity incentive compensation for the three-year measurement period beginning in 2007 has been reported in the summary compensation table in the Stock Awards column.
Executive Deferred Compensation
Participation in the Executive Deferred Compensation Plan (the “DC Plan”) is limited to employees at the Director level and above within the Company’s organizational structure (currently, in ascending order, Directors, Senior Directors, Vice Presidents, Senior Vice Presidents, and the President). Participants in the DC Plan may elect to defer any amount of base compensation and bonus. The Company matches a portion of amounts deferred by participants at the level of Vice President and above on a quarterly basis as follows: 50% match on salary deferred, up to a total match of $12,000.00 per year for Senior Vice Presidents and above and $7,500.00 per year for Vice Presidents. No match is made on deferrals by other participants. The matching contributions made to the DC Plan by the Company are made in the form of Company common stock.
Compensation deferred by a participant while participating in the DC Plan is deferred until such participant’s retirement, termination, disability or death, or a change in control of the Company, as defined in the DC Plan, and in such event is paid out to the participant or his beneficiary. Under current tax law, a participant does not recognize income with respect to deferred compensation until it is paid to him or her. Upon payment, the participant will recognize ordinary income in an amount equal to the sum of the cash and the fair market value of the shares of stock received, and the Company will be entitled to a deduction equal to the income recognized by the participant.
Distributions of the participants’ deferred compensation and Company stock contributed as matching contributions is made as soon as administratively feasible six months after retirement or termination of employment, unless the participant dies or becomes disabled while still an employee, in which case both distributions are made as soon as administratively feasible.


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In the event the participant terminates employment (for reasons other than death, disability or retirement) without participating in the DC Plan for three years, the matching contributions and earnings attributable thereto are forfeited. In the event that a participant terminates employment after three years but less than five years of participation in the DC Plan, the participant forfeits 67% of the matching contribution and earnings. In the event a participant terminates employment after five years but less than seven years of participation in the DC Plan, the participant forfeits 33% of the matching contribution and earnings. In the event a participant terminates employment after seven years of participation in the DC Plan, the participant is entitled to retain all of the matching contribution and earnings.
In the event of a distribution of benefits as a result of a change in control, the Company will increase the benefits for the Senior Vice Presidents and the President by an amount sufficient to offset the income tax obligations created by the distribution of benefits.
Participants forfeit undistributed matching contributions if the participant is terminated for “cause” as defined in the DC Plan or the participant enters into a business or employment which the Company’s Chief Executive Officer determines to be in violation of any non-compete agreement between the participant and the Company.
Other Elements of Compensation
For our named executive officers, the amount of compensation shown under the Other Compensation column of the Summary Compensation Table represents less than 2% of their total compensation for the year. These amounts represented mainly Company matches to the DC Plan, excess group term life insurance premiums and additional compensation paid to executive employees related to health and welfare benefits. We also have change of control provisions in the employment agreements with our President and Chief Executive Officer, and our Chief Financial Officer, as well as in all of the equity incentive agreements with all of our executives and key employees. The change of control provisions in the two employment agreements are “double-trigger” arrangements, meaning that payments are only made if there is a change in control of the Company and the officer’s employment is terminated without cause, or the officer terminates employment for good reason, as such terms are defined in their respective employment agreements. All of our employment agreements with the named executive officers, and the other executive officers, contain severance agreements ranging from one to three years in the event of termination by the Company other than for cause. These agreements are discussed in greater detail on page 30 under “Potential Payments Upon Termination or Change of Control.” We believe that providing these agreements helps increase our ability to attract, retain and motivate highly qualified management personnel and encourage their continued dedication without distraction from concerns over job security relating, among other things, to a change in control of the Company.
Perquisites and Other Personal Benefits
The Company provides named executive officers with perquisites and other personal benefits that the Company and the Committee believe are reasonable and consistent with its overall compensation program to better enable the Company to attract and retain superior employees for key positions. The Committee periodically reviews the levels of perquisites and other personal benefits provided to named executive officers.
The named executive officers are permitted to fly in business class when traveling overseas on business and are permitted to attend sporting events utilizing Company paid tickets that are not otherwise utilized in connection with business development.


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Tax and Accounting Implications
Deductibility of Executive Compensation
As part of its role, the Committee reviews and considers the deductibility of executive compensation under Section 162(m) of the Internal Revenue Code, which provides that the Company may not deduct compensation of more than $1,000,000 per year that is paid to certain individuals. The Company believes that compensation paid under the management incentive plans is generally fully deductible for federal income tax purposes. However, in certain situations, the Committee may approve compensation that will not meet these requirements in order to ensure competitive levels of total compensation for its executive officers.
Nonqualified Deferred Compensation
On October 22, 2004, the American Jobs Creation Act of 2004 was signed into law, changing the tax rules applicable to nonqualified deferred compensation arrangements. While the final regulations have not become effective yet, the Company believes it is operating in good faith compliance with the statutory provisions which were effective January 1, 2005. A more detailed discussion of the Company’s nonqualified deferred compensation arrangements is provided on page 19 under the heading “Executive Deferred Compensation.”
Accounting for Equity Based Compensation
Beginning on January 1, 2006, the Company began accounting for stock-based payments, including those under its long-term incentive programs, in accordance with the requirements of FASB Statement 123(R).
Stock Ownership Guidelines
The Board has adopted stock ownership guidelines for the named executive officers and other members of the senior management team, which vary by position from 150% to 400% of base salary. These guidelines, which allow the executives five (5) years beginning January 1, 2008 to acquire this amount of stock, were adopted in 2006. The Committee will review share ownership of the Company’s executives on an annual basis to ensure that the executive officers are aware of where each stands in relation to the established guidelines. For purposes of the guidelines, stock ownership includes fully vested stock options, directly held common stock, time-vested restricted stock, performance shares and indirectly held shares that are considered beneficially owned under applicable SEC rules. We believe that these guidelines are appropriate to encourage our executive officers to hold a sufficient amount of our equity to create a mutuality of interest between our executive officers and our shareholders. These guidelines are aspirational in nature, but the Committee will review the status of officer stock ownership on an annual basis to monitor compliance.
COMPENSATION AND HUMAN RESOURCE DEVELOPMENT COMMITTEE REPORT
The Compensation and Human Resource Development Committee of the Board of Directors has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) ofRegulation S-K with management and, based on such review and discussions, the Compensation and Human Resource Development Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.
THE COMPENSATION AND HUMAN RESOURCE DEVELOPMENT COMMITTEE
Mark C. Bozek, Chairman
James K. Murray, Jr.
James S. MacLeod


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SUMMARY COMPENSATION TABLE
                              
      Long Term Compensation  
    Annual Compensation    
        Securities  
      Other Annual Restricted Underlying All Other
Name Date Salary($) Bonus(1)($) Compensation(2)($) Stock(3)($) Options (#) Compensation(4)($)
               
John H. Sykes(5)  2004   1,092,044   —   —   5,986   —   1,704,166 
 Chairman of the Board and  2003   816,121   —   —   5,986   —   30,173 
 Chief Executive Officer  2002   550,281   —   —   5,973   1,250,000   47,139 
 (Ret.)                            
Charles E. Sykes(6)  2004   337,828   52,713       —       10,566 
 President and  2003   246,546   50,000   —   459       6,029 
 Chief Executive Officer  2002   204,372   —   —   —   111,000   7,201 
W. Michael Kipphut  2004   360,769   224,000   —   6,610   —   12,036 
 Group Executive, Senior  2003   335,021   226,125   —   6,488   —   10,755 
 Vice President – Finance  2002   325,069   —   —   6,476   —   9,189 
James T. Holder  2004   205,000   58,400   —   1,642   —   10,263 
 Vice President, General  2003   193,202   57,750   —   1,616   —   6,839 
 Counsel, & Secretary  2002   187,115   —   —   1,617   —   5,129 
James C. Hobby  2004   220,000   20,295   —   —   —   10,068 
 Sr. Vice President –  2003   66,846   —   —   —   —   30,374 
 Global Operations  2002   —   —   —   —   —   — 
William N. Rocktoff  2004   175,007   48,600       4,687   —   10,556 
 Vice President –  2003   155,310   55,500       5,412   —   10,319 
 Corporate Controller  2002   145,572   —       3,754   37,000   7,732 
Gerry L. Rogers(7)  2004   167,243   51,648   97,768   7,131       11,764 
 Senior Vice President &  2003   217,493   122,625   —   11,186   —   12,312 
 Chief Information Officer  2002   213,167   —   —   10,942   95,700   10,679 
 (Ret.)                            
 
The table below summarizes the total compensation paid to, or earned by each of the named executive officers for the fiscal years ending December 31, 2006 and December 31, 2007. The Company has entered into employment agreements with each of the named executive officers which are summarized under the section entitled “Employment Agreements” below. When setting the total compensation for each of the named executive officers, the Committee considers all of the executive’s current compensation, including equity and non-equity based compensation.
Except for the signing bonus paid to Mr. Zingale in 2006, the named executive officers were not entitled to receive payments which would be characterized as “Bonus” payments for the fiscal years ended December 31, 2007 and December 31, 2006. Amounts listed under column (g), “Non-Equity Incentive Plan Compensation” were paid in accordance with parameters determined by the Committee at its December 21, 2006 and March 15, 2006 meetings, respectively, and were paid in March, 2008 and March, 2007, respectively.
                                     
(a) (b)  (c)  (d)  (e)  (f)  (g)  (h)  (i)  (j) 
                    Change in
       
                    Pension Value
       
                    and
       
                 Non-Equity
  Nonqualified
       
              Option
  Incentive Plan
  Deferred
  All Other
    
           Stock
  Awards
  Compensation
  Compensation
  Compensation
    
     Salary
  Bonus
  Awards ($)
  ($)
  ($)
  Earnings
  ($)
  Total
 
Name and Principal Position
 Year  ($)  ($)  (1)  (2)  (3)  ($)  (4)  ($) 
 
Charles E. Sykes  2007   500,000   0   750,324   219,600   505,150   0   24,995   2,000,069 
President and Chief Executive Officer  2006   518,990   0   321,413   86,705   590,103   0   14,144   1,531,355 
W. Michael Kipphut  2007   368,500   0   358,798   96,855   299,125   0   33,522   1,156,800 
Senior Vice President & Chief Financial Officer  2006   368,500   0   162,546   38,150   348,902   0   29,060   947,158 
James C. Hobby  2007   303,270   0   232,894   63,078   205,185   0   21,684   826,111 
Senior Vice President — Global Operations  2006   275,000   0   102,626   23,488   217,291   0   23,125   641,530 
Lawrence R. Zingale(5)  2007   305,000   0   185,244   66,457   190,625   0   20,542   767,868 
Senior Vice President — Global Sales and Client Management  2006   286,231   25,000   64,839   26,050   228,750   0   86,143   717,013 
David L. Pearson  2007   211,923   0   134,544   20,377   147,012   0   23,694   537,550 
Senior Vice President — Information Technology  2006   210,000   0   70,817   17,936   168,541   0   23,045   490,339 
(1)All bonuses are reflectedThe amounts in column (e) reflect the dollar amount recognized for financial statement reporting purposes for the fiscal years ended December 31, 2007 and December 31, 2006, in accordance with FAS 123(R), of awards pursuant to long term incentive bonus programs established by the Compensation and Human Resource Development Committee, and thus may include amounts from awards granted in and prior to the respective years. Assumptions used in the calculation of these amounts are included in footnotes 1 and 23 to the Company’s audited financial statements for the fiscal year paid. Such bonuses are based upon performanceended December 31, 2007 and footnotes 1 and 20 to the Company’s audited financial statements for the fiscal year ended December 31, 2006 included in the prior year but are payableCompany’s Annual Reports onForm 10-K filed with the followingSecurities and Exchange Commission on March 13, 2008 and are payable only if the employee is then employed by the Company.March 13, 2007, respectively.
 
(2)Does not includeThe amounts shown in column (f) represent stock appreciation rights granted as part of long-term, equity-based incentive awards.


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(3)The amounts in column (g) reflect the valuecash awards to the named individuals pursuant to annual performance based incentive programs established by the Committee and discussed in more detail on page 15 under the heading “Performance Based Annual Cash Incentive Compensation.”
(4)The amount shown in column (i) reflects for each named executive offer:
 • matching contributions allocated by the Company to each of perquisites provided to the named executive officers whichpursuant to the Executive Deferred Compensation Plan described in more detail on page 19 under the aggregate did not exceed the lesser of $50,000 or 10% of such officer’s salary and bonus. The amounts shown for Mr. Rogers represent post-retirement consulting fees paid during fiscal year 2004.heading “Executive Deferred Compensation;”
 
(3) Represents the value of vested restricted stock paid • reimbursement for premiums attributable to the named executive officers based upon the closing prices of the Company’s common stock on the grant dates of the awards. The restricted stock is paid as a matching contribution under the Company’s Executive Deferred Compensation Plan (the “Plan”). Based on the closing price of the Company’s stock ($6.95) on December 31, 2004, the aggregate numberincreased coverage for vision, dental and value of all vested restricted stock held by the named executive officers as of that date were as follows: Mr. John Sykes (5,050 — $35,098), Mr. Charles Sykes (440 — $3,055), Mr. Kipphut (1,225 — $8,516), Mr. Holder (275 — $1,910), Mr. Rocktoff (1,061 — $7,372) and Mr. Rogers (1,983 — $13,780). If we determine to pay dividends, the dividends will accrue on the restricted stock. The restricted stock vests 25% if the named executive officer has 3 years participation in the Plan, 50% with 6 years participation in the Plan and 100% with 10 years participation in the Plan.group medical insurance benefits.

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 • the cost of premiums for term life and disability insurance benefits;
(4) 
The compensation shown as “All Other Compensation” for 2004 consists of the following: (i) • the Company’s matching contribution to the Sykes Enterprises, Incorporated Employees’ Savings Plan and TrustTrust.
The amount in column (i) for Mr. Kipphut also includes a country club membership paid by the Company, and the amount in column (i) for Mr. Zingale includes relocation expenses paid in 2006.
(5)The amount in column (d) for Mr. Zingale represents a signing bonus paid at the inception of his employment in January, 2006.


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GRANTS OF PLAN-BASED AWARDS
The following table provides information about equity and non-equity awards granted to the named executives in 2007, including (i) the grant date, (ii) the estimated future payouts under the non-equity incentive plan awards, (iii) the estimated future payouts under equity incentive plan awards, which consist of shares of restricted stock, (iv) all other stock awards which consist of shares of the Company’s stock contributed as matching contributions under the Executive Deferred Compensation Plan, (v) all other option awards, which consist of Stock Appreciation Rights and the base price of those Stock Appreciation Rights, and (vi) the fair value of the equity awards on the date of grant.
                                             
                       (i)
  (j)
       
                       All Other
  All Other
     (l)
 
                       Stock
  Option
  (k)
  Grant
 
     Estimated Future Payouts
  Estimated Future Payouts
  Awards:
  Awards:
  Exercise
  Date Fair
 
     Under Non-Equity Incentive
  Under Equity Incentive Plan
  Number of
  Number of
  or Base
  Value of
 
  (b)
  Plan Awards(1)  Awards(2)  Shares of
  Securities
  Price
  Stock and
 
  2007
  (c)
  (d)
  (e)
  (f)
  (g)
  (h)
  Stock or
  Underlying
  of Option
  Option
 
(a)
 Grant
  Threshold
  Target
  Maximum
  Threshold
  Target
  Maximum
  Units
  Options
  Awards
  Awards
 
Name
 Date  ($)  ($)  ($)  (#)  (#)  (#)  (#)(3)  (#)(4)  ($/sh)  ($) 
 
Charles E. Sykes  1/02   —   —   —   30,234   37,793   56,689   —   —   17.64   666,669 
   1/02   —   —   —   —   —   —   —   43,178   17.64   333,333 
   1/23   187,500   375,000   562,500   —   —   —   —   —   —   — 
   3/31   —   —   —   —   —   —   657   —   18.24   11,984 
W. Michael Kipphut  1/02   —   —   —   13,370   16,712   25,068   —   —   17.64   294,800 
   1/02   —   —   —   —   —   —   —   19,093   17.64   147,400 
   1/08   110,550   221,100   331,650   —   —   —   —   —   —   — 
   3/31   —   —   —   —   —   —   320   —   18.24   5,837 
   6/30   —   —   —   —   —   —   110   —   18.99   2,089 
   9/30   —   —   —   —   —   —   108   —   16.61   1,794 
   12/31   —   —   —   —   —   —   116   —   18.00   2,088 
Lawrence R. Zingale  1/02   —   —   —   9,222   11,527   17,290   —   —   17.64   203,336 
   1/02   —   —   —   —   —   —   —   13,169   17.64   101,667 
   1/07   76,250   152,500   228,750   —   —   —   —   —   —   — 
   3/31   —   —   —   —   —   —   110   —   18.24   2,006 
   6/30   —   —   —   —   —   —   106   —   18.99   2,013 
   9/30   —   —   —   —   —   —   104   —   16.61   1,727 
   12/31   —   —   —   —   —   —   112   —   18.00   2,016 
James C. Hobby  1/02   —   —   —   9,222   11,527   17,290   —   —   17.64   203,336 
   1/02   —   —   —   —   —   —   —   13,169   17.64   101,667 
   1/08   76,250   152,500   228,750   —   —   —   —   —   —   — 
   3/31   —   —   —   —   —   —   616   —   18.24   11,236 
   6/30   —   —   —   —   —   —   39   —   18.99   741 
David L. Pearson  1/02   —   —   —   3,810   4,762   7,143   —   —   17.64   84,002 
   1/02   —   —   —   —   —   —   —   5,440   17.64   42,000 
   1/12   52,500   105,000   157,500   —   —   —   —   —   —   — 
   3/31   —   —   —   —   —   —   649   —   18.24   11,838 
(1)These amounts are based on the individual’s current salary and position.
(2)Where amounts are shown in columns (f) and (h), then the amounts shown in column (f) reflect the Long-Term Incentive Stock Grant minimum which is 80% of the target amount shown in column (g), and the amount shown in column (h) is 150% of $3,375 for Mr. John Sykes, $1,377 for Mr. Kipphut, $1,297 for Mr. Rocktoffsuch target amount. The target amount shown is an absolute target. These amounts are based on the individual’s current salary and $4,100 for Mr. Rogers; (ii) excess group term life insuranceposition. The grant date fair value of the long-term incentive plan awards are based upon the target amounts shown in column (g).


24

(3)The amounts shown in column (i) reflect the amountnumber of $29,809 for Mr. John Sykes, $650 for Mr. Charles Sykes, $1,079 for Mr. Kipphut, $650 for Mr. Holder, $1,079 for Mr. Hobby, $360 for Mr. Rocktoff and $733 for Mr. Rogers; (iii) additional compensation paidshares of stock granted to employees related to health and welfare benefits in the amount of $12,482 for Mr. John Sykes, $9,832 for Mr. Charles Sykes, $8,831 for Mr. Kipphut, $9,613 for Mr. Holder, $7,498 for Mr. Hobby, $8,899 for Mr. Rocktoff, and $9,832 for Mr. Rogers; (iv) payment to Mr. John Sykeseach named executive officer as matching contributions pursuant to his Founder’s Retirement Agreement in the amount of $1,658,500, and (v) distribution to Mr. Rogers from the Company’s Executive Deferred Compensation PlanPlan.
(4)The amounts shown in column (j) reflect the number of Stock Appreciation Rights granted to each named executive officer as a resultpart of his retirementthe Long-Term Incentive awards as described in more detail on page 16 under the heading “Performance-Based, Long-Term, Equity Incentive Compensation.” The actual number of shares underlying the Stock Appreciation Rights cannot be determined until such time as the Stock Appreciation Rights vest and are exercised and the spread between the fair value on the date of exercise and the base price is known. The fair value of the Stock Appreciation Rights included in column (l) is the amount of $94,248.determined pursuant to SFAS 123(R).


25

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
The following table provides information on the current holdings of stock option and stock awards by the named executives. The table includes both exercisable and unexercisable options together with the exercise price and the expiration date; unvested Stock Appreciation Rights; the number of shares and market value of unvested matching contributions to the Executive Deferred Compensation Plan; and the number of shares of long term incentive (“LTI”) restricted stock together with the market value of those shares.
                                     
  Option Awards  Stock Awards 
(a) (b)  (c)  (d)  (e)  (f)  (g)  (h)  (i)  (j) 
                          Equity
 
                       Equity
  Incentive
 
        Equity
              Incentive
  Plan
 
        Incentive
              Plan
  Awards:
 
        Plan
              Awards:
  Market or
 
        Awards:
           Market
  Number of
  Payout Value
 
        Number of
        Number
  Value of
  Unearned
  of Unearned
 
  Number of
  Number of
  Securities
        of Shares
  Shares or
  Shares, Units
  Shares, Units
 
  Securities
  Securities
  Underlying
        or Units
  Units of
  or Other
  or Other
 
  Underlying
  Underlying
  Unexercised
  Option
     of Stock
  Stock That
  Rights That
  Rights That
 
  Unexercised
  Unexercised
  Unearned
  Exercise
  Option
  That Have
  Have Not
  Have Not
  Have Not
 
  Options (#)
  Options (#)
  Options
  Price
  Expiration
  Not Vested
  Vested
  Vested
  Vested
 
Name
 Exercisable  Unexercisable  (#)  ($)  Date  (#)  ($)  (#)  ($) 
 
Charles E. Sykes                                    
2005-2007 LTI RS(1)
  —   —   —   —   —   —   —   20,000   360,000 
2006-2008 LTI RS(2)
  —   —   —   —   —   —   —   68,510   1,233,180 
2006-2008 LTI SARs(3)
  15,705   31,412   —   14.56   03/29/16   —   —   —   — 
2007-2009 LTI RS(4)
  —   —   —   —   —   —   —   56,689   1,020,402 
2007-2009 SARs(5)
      43,178       17.64   01/02/17   —   —   —   — 
EDC Match(6)  —   —   —   —   —   —   —   —   — 
W. Michael Kipphut                                    
2005-2007 LTI RS(1)
  —   —   —   —   —   —   —   12,500   225,000 
2006-2008 LTI RS(2)
  —   —   —   —   —   —   —   30,371   546,678 
2006-2008 LTI SARs(3)
  6,910   13,821   —   14.56   03/29/16   —   —   —   — 
2007-2009 LTI RS(4)
  —   —   —   —   —   —   —   25,068   451,224 
2007-2009 SARs(5)
  —   19,093   —   17.64   01/02/17   —   —   —   — 
Options  18,474   —   —   16.24   03/06/10   —   —   —   — 
Options  31,526   —   —   16.24   03/06/10   —   —   —   — 
Options  60,000   —   —   16.24   03/06/10   —   —   —   — 
EDC Match(6)  —   —   —   —   —   —   —   —   — 
Lawrence R. Zingale                                    
2006-2008 LTI RS(2)
  —   —   —   —   —   —   —   21,053   378,954 
2006-2008 LTI SARs(3)
  4,721   9,435   —   14.56   03/29/16   —   —   —   — 
2007-2009 LTI RS(4)
  —   —   —   —   —   —   —   17,290   311,220 
2007-2009 LTI SARs(5)
  —   13,169   —   17.64   01/02/17   —   —   —   — 
EDC Match(6)  —   —   —   —   —   431   7,765   —   — 
James C. Hobby                                    
2005-2007 LTI RS(1)
  —   —   —   —   —   —   —   8,000   144,000 
2006-2008 LTI RS(2)
  —   —   —   —   —   —   —   18,982   341,676 
2006-2008 LTI SARs(3)
  4,254   8,510   —   14.56   03/29/16   —   —   —   — 
2007-2009 LTI RS(4)
  —   —   —   —   —   —   —   17,290   311,220 
2007-2009 LTI SARs(5)
  —   13,169   —   17.64   01/02/17   —   —   —   — 
EDC Match(6)  —   —   —   —   —   1,853   33,351   —   — 
David L. Pearson    ��                               
2005-2007 LTI RS(1)
  —   —   —   —   —   —   —   8,000   144,000 
2006-2008 LTI RS(2)
  —   —   —   —   —   —   —   8,654   155,772 
2006-2008 LTI SARs(3)
  1,969   3,938   —   14.56   03/29/16   —   —   —   — 
2007-2009 LTI RS(4)
  —   —   —   —   —   —   —   7,143   128,574 
2007-2009 SARs(5)
  —   5,440   —   17.64   01/02/17   —   —   —   — 
Options  7,000   —   —   13.18   07/03/10   —   —   —   — 
Options  10,000   —   —   4.05   10/17/10   —   —   —   — 
Options  10,000   —   —   9.00   02/01/12   —   —   —   — 
Options  3,300   —   —   9.00   02/01/12   —   —   —   — 
EDC Match(6)  —   —   —   —   —   1,702   30,639   —   — 


26

(1)The figures in this row represent restricted shares that were issued to the named executive officer in connection with the long-term incentive award for the2005-2007 performance measurement period.
(2)The figures in this row represent restricted shares that were issued to the named executive officer in connection with the long-term incentive award for the2006-2008 performance measurement period.
(3)The figures in this row represent Stock Appreciation Rights that were issued to the named executive officer in connection with the long-term incentive award for the2006-2008 performance measurement period.
(4)The figures in this row represent restricted shares that were issued to the named executive officer in connection with the long-term incentive award for the2007-2009 performance measurement period.
 
(5)Mr. John Sykes retired as Chairman ofThe figures in this row represent Stock Appreciation Rights that were issued to the Board and Chief Executive Officer effective August 1, 2004. The Company and Mr. Sykes signed the Founder’s Retirement and Consulting Agreement on December 10, 2004 terminating Mr. Sykes’ employmentnamed executive officer in connection with the Company effective December 31, 2004.long-term incentive award for the2007-2009 performance measurement period.
 
(6)Mr. Charles Sykes wasThe figures in this row represent restricted shares granted to the named President and Chief Executive Officer in August, 2004.
(7) Mr. Rogers retired on July 30, 2004 andexecutive officer as matching contributions by the Company thereafter engaged his services as a consultant through December 31, 2004.under the Executive Deferred Compensation Plan.
OPTION GRANTS IN LAST FISCAL YEAREXERCISES AND STOCK VESTED
 There were no awards of stock options during 2004 to any of the executive officers named in the Summary Compensation Table.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
The following table sets forthprovides information for the named executive officers on (1) stock option exercises during 2007, including the number of shares acquired upon exercise and the value realized; and (2) the number of shares acquired upon vesting of matching contributions under the Executive Deferred Compensation Plan, and the value realized upon the vesting of such shares.
                 
  Options Awards  Stock Awards(1) 
(a) (b)  (c)  (d)  (e) 
  Number of Shares
  Value Realized
  Number of Shares
  Value Realized
 
  Acquired on Exercise
  on Exercise
  Acquired on Vesting
  on Vesting
 
Name
 (#)  ($)  (#)  ($) 
 
Charles E. Sykes                
Options  —   —   —   — 
EDC Matching Contr.  —   —   1,230   22,254 
W. Michael Kipphut                
Options  —   —   —   — 
EDC Matching Contr.  —   —   2,955   53,222 
Lawrence R. Zingale                
Options  —   —   —   — 
EDC Matching Contr.  —   —   —   — 
James C. Hobby                
Options  —   —   —   — 
EDC Matching Contr.  —   —   913   16,426 
David L. Pearson                
Options  —   —   —   — 
EDC Matching Contr.  —   —   435   7,931 
(1)Reflects the Company’s matching contributions in the form of shares of its common stock held for the account of the named executive officer in the Executive Deferred Compensation Plan which vested during fiscal year ending December 31, 2007.


27

PENSION BENEFITS
The Company does not maintain any pension plans for the benefit of its executive officers.
NONQUALIFIED DEFERRED COMPENSATION
Pursuant to the Company’s Executive Deferred Compensation Plan ( the “Plan”), certain executives, including the named executive officers, may defer all or any portion of their base salary, and all or any portion of their performance based non-equity incentive compensation. Deferral elections are made on or before December 31 of each year for amounts to be deferred from income earned with respect to the aggregate stock option exercisesfollowing year. The table below shows the investment options available under the Deferred Compensation Plan and their annual rate of return for the calendar year ended December 31, 2007, as reported by the administrator of the Plan.
           
  Rate
   Rate
Name of Fund
 
of Return
 Name of Fund 
of Return
 
Wachovia Diversified Stable Value  4.81% Davis Opportunity A  (1.42)%
Evergreen Core Bond A  4.78% Dreyfus Premier New Leaders A  (4.77)%
AllianceBernstein Balanced Shares A  2.96% Columbia Small Cap Value I A  (2.63)%
Van Kampen Comstock R  (2.09)% Putnam Capital Opportunities A  (8.68)%
Evergreen Equity Index A  4.94% AIM Small Cap Growth A  11.38%
American Funds Growth Fund of America R3  10.59% Evergreen International Equity A  14.67%
Goldman Sachs Mid Cap Value A  2.91% American Century Inf-Adj Bond Inv.  10.95%
Distributions of the participants’ deferred compensation and any vested Company stock matching contributions are made as soon as administratively feasible six months after retirement or termination of employment, unless the participant dies or becomes disabled while still an employee, in which case both distributions are made as soon as administratively feasible.
In the event the participant terminates employment (for reasons other than death, disability or retirement) without participating in the plan for three years, the matching contributions and earnings attributable thereto are forfeited. In the event that a participant terminates employment after three years but less than five years of participation in the Plan, the participant forfeits 67% of the matching contribution and earnings. In the event a participant terminates employment after five years but less than seven years of participation in the Plan, the participant forfeits 33% of the matching contribution and earnings.
In the event of a distribution of benefits as a result of a change in control, the Company will increase the benefits for the Senior Vice Presidents and the President by an amount sufficient to offset the income tax obligations created by the distribution of benefits.
Participants forfeit undistributed matching contributions if the participant is terminated for “cause” as defined in the Plan or the participant enters into a business or employment which the Company’s chief executive officer determines to be in violation of any non-compete agreement between the participant and the Company.


28

The following table shows information regarding contributions by the named executive officers, named in the Summary Compensation TableCompany’s matching contributions, aggregate earnings on contributions during 2004fiscal year 2007, and the year-end value of unexercised options held by suchaggregate balance at year end. There were no distributions from the plan to named executive officers.officers during fiscal year 2007.
                         
        Value of Unexercised
      Number of Unexercised In-The-Money Options
  Shares   Options at Fiscal Year End At Fiscal Year End(1)
  Acquired on Value    
  Exercise(#) Realized Exercisable Unexercisable Exercisable Unexercisable
             
John H. Sykes  —   —   1,250,000(2)  —  $—  $ — 
Charles E. Sykes  —   —   153,500   —  $101,500  $— 
W. Michael Kipphut  —   —   235,000   —  $145,500  $— 
James T. Holder  —   —   8,334   7,500  $26,293  $4,365 
William N. Rocktoff  —   —   —   —  $29,000   — 
James Hobby  —   —   —   —   —   — 
Gerry L. Rogers  —   —   —   —   —   — 
 
                     
(a) (b)  (c)  (d)  (e)  (f) 
  Executive
  Company
  Aggregate
     Aggregate
 
  Contributions
  Contribution
  Earnings
  Aggregate
  Balance at
 
  in Last
  in Last
  in Last
  Withdrawals/
  Last Fiscal
 
  Fiscal Year(1)
  Fiscal Year(2)
  Fiscal Year
  Distributions
  Year End(3)
 
Name
 ($)  ($)  ($)  ($)  ($) 
 
Charles E. Sykes $24,000  $12,000  $572  $0  $96,136 
W. Michael Kipphut $23,700  $11,850  $20,359  $0  $302,072 
Lawrence R. Zingale $15,576  $7,788  $296  $0  $19,740 
James C. Hobby $92,919  $12,000  $5,338  $0  $197,053 
David L. Pearson $23,689  $11,845  $6,161  $0  $214,473 
(1)Based upon the closing price of $6.95 per share of common stock on December 31, 2004, as reportedThe amounts shown are included in the NASDAQ Stock Market.amounts of “salary” in column (c) of the Summary Compensation Table.
 
(2)These options expired unexercised on March 31, 2005.The amounts shown are included in the amounts of “Other Compensation” in column (i) of the Summary Compensation Table.
(3)The amounts shown include 100% of the aggregate executive and Company contributions which have all been reported in the Summary Compensation Table.
EQUITY COMPENSATION PLAN INFORMATION
The following table summarizes the equity compensation plans under which the equity securities of Sykes may be issued as of December 31, 2007:
             
  (a)  (b)  (c) 
        Number of Securities
 
  Number of
     Remaining Available for
 
  Securities to be
  Weighted Average
  Future Issuance Under
 
  Issued Upon
  Exercise Price of
  Equity Compensation
 
  Exercise of
  Outstanding
  Plans (Excluding
 
  Options, Warrants
  Options, Warrants
  Securities Reflected in
 
  and Rights  and Rights  Column (a)) 
 
Equity compensation plans approved by shareholders(1)  510,391  $13.49(2)  6,584,489 
Equity compensation plans not approved by shareholders  53,496(3)  —   N/A(3)
Totals  563,887   —   6,584,489 
(1)Includes shares of common stock of Sykes authorized for awards under the 2001 Equity Incentive Plan as well as the 2000 Stock Option Plan, the 1996 Employee Stock Option Plan, and the 1997 Management Stock Incentive Plan, all of which are predecessor plans to the 2001 Equity Incentive Plan. Also includes shares of common stock of Sykes reserved for issuance under the 1999 Employees’ Stock Purchase Plan, the Amended and Restated 1996 Non-Employee Director Stock Option Plan, the 1996 Non-Employee Director Fee Plan, and the 2004 Non-Employee Director Fee Plan.
(2)Represents the weighted average exercise price of stock options only.


29

25

(3)Represents shares of common stock of Sykes issued as matching grants under the Executive Deferred Compensation Plan for executives described on page 28 above. There is no specific number of shares reserved for issuance under the Executive Deferred Compensation Plan.
Shares awarded under all of the above plans may be from Sykes’ authorized and unissued shares, treasury shares or shares acquired in the open market. For a summary of the terms of Sykes’ equity compensation plans, see Note 19 of our consolidated financial statements in the Annual Report onForm 10-K incorporated herein by reference.
EMPLOYMENT AGREEMENTSPOTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL
 
The tables below reflect the amount of compensation to each of the named executive officers of the Company in the event of a termination of such executive’s employment. The amount of compensation payable to each named executive officer upon voluntary termination, involuntary not-for-cause termination, termination following a change of control and in the event of a disability or death of the executive is shown below. The amounts shown assume that such termination was effective as of December 31, 2007, and thus includes amounts earned through such time and are estimates of the amounts which would be paid out to the executives upon their termination. The actual amounts to be paid out can only be determined at the time of such executive’s separation from the Company.
Payments Made Upon Termination
Regardless of the manner in which a named executive officer’s employment terminates, he is entitled to receive amounts earned during his term of employment. Depending upon the date of a termination, such amounts may include:
• non-equity incentive compensation earned during the fiscal year;
• shares which have vested and for which the restrictions have lapsed under Long-Term Incentive compensation awards;
• shares to be issued as a result of the vesting of SARs under Long-Term Incentive compensation awards;
• amounts contributed to the Executive Deferred Compensation Plan; and
• unused vacation pay.
Payments Made Upon Termination by the Company Without Cause, or by the Executive with Good Reason
In the event Mr. Sykes’ employment is terminated by the Company prior to the expiration of any renewal period for any reason other than death, disability, or cause (as defined in his employment agreement), or if his employment agreement is terminated by Mr. Sykes prior to the expiration of the renewal period for good reason (as defined below under “Employment Agreements”), the Company is required to pay Mr. Sykes an amount equal to his weekly base salary through the end of the renewal period of the agreement or for 104 weeks, whichever is greater.
In the event Mr. Kipphut’s employment is terminated by the Company prior to the expiration of the any renewal period for any reason other than death, disability, or cause (as defined in his employment agreement), or if his employment agreement is terminated by Mr. Kipphut prior to the expiration of the renewal period for good reason (as defined below under “Employment Agreements”), the Company is required to pay Mr. Kipphut an amount equal to his weekly base salary through the end of the renewal period of the agreement or for 52 weeks, whichever is


30

greater, plus an amount equal to the maximum annual performance bonus he could earn (60% of his annual base salary), which would also be paid over the same period as the other payments.
In the event of the termination by the Company of the employment of any named executive officer other than Mr. Sykes or Mr. Kipphut for any reason other than death, disability or cause, they will be entitled to receive an amount equal to their annual base salary payable over a one year period.
Payments Made Upon Death or Disability
In the event of the death or disability of a named executive officer, in addition to the benefits listed under the heading “Payments Made Upon Termination” above, the named executive officer will receive benefits under the Company’s disability plan or payments under the Company’s life insurance plan, as appropriate. The Company pays for life insurance and accidental death and dismemberment coverage for its executive team in amounts equal to twice the executive’s base salary, up to a maximum of $500,000. The Company also pays for short term disability for its executives with a benefit of 70% of base salary, up to a maximum of $2,500 per week, and long term disability utilizing multiple plans. The base long term disability plan provides for a benefit to the executives of 70% of base salary, up to a maximum of $15,000 per month. The base long term disability plan is supplemented with two personal plans designed to provide the executives with long term disability insurance approximating 75% of covered compensation.
Payments Made Upon a Change of Control
The Company has entered into employment agreements with Mr. Sykes and Mr. Kipphut which contain change of control payment provisions. Pursuant to these provisions, if Mr. Sykes’ or Mr. Kipphut’s employment is terminated following a change of control (other than termination by the Company for cause or by reason of death or disability), or if Mr. Sykes or Mr. Kipphut terminate their employment in certain circumstances defined in their respective agreements which constitutes “good reason,” in addition to the benefits listed under the heading “Payments Made Upon Termination”:
• Mr. Sykes will receive:
• his then current base salary for a period of three years;
• an amount determined by multiplying the annual target bonus designated or otherwise indicated for Mr. Sykes in the year such change of control occurs by a factor of three, and paying such amount over a 156-week period; and
• all stock options, stock grants or other similar equity incentivesand/or compensation programs will immediately accelerate and become fully vested and exercisable at the option of Mr. Sykes.
• Mr. Kipphut will receive:
• his then current base salary for a period of two years;
• an amount determined by multiplying the annual target bonus designated or otherwise indicated for Mr. Kipphut in the year such change of control occurs by a factor of two, and paying such amount over a 104-week period; and
• all stock options, stock grants or other similar equity incentivesand/or compensation programs will immediately accelerate and become fully vested and exercisable at the option of Mr. Kipphut.


31

The named executive officers, other than Mr. Sykes and Mr. Kipphut, do not have change of control provisions in their respective employment agreements, but under various equity incentive agreements, all stock options, stock grants or other similar equity incentivesand/or compensation programs will immediately accelerate and become fully vested and exercisable at the option of the executive in the event of a change in control.
Charles E. Sykes
The following table shows the potential payments upon termination or a change of control of the Company for Charles E. Sykes, the Company’s President and Chief Executive Officer, as if such termination had occurred on December 31, 2007:
                     
  Company Initiated  Executive Initiated 
  Before
  After
          
  Change in
  Change in
          
  Control
  Control
          
  Termination
  Termination
     Voluntary
    
  w/o Cause
  w/o Cause
     Termination
    
  or for Good
  or for Good
  Voluntary
  for “Good
  Change in
 
  Reason
  Reason
  Termination
  Reason”
  Control
 
Type of Benefit
 ($)  ($)  ($)  ($)  ($) 
 
Severance Pay  1,000,000   1,500,000   0   1,000,000   1,500,000 
Bonus Payment  0   1,125,000   0   1,125,000   1,125,000 
Stock Grants Vesting Acceleration  0   2,613,582   0   0   2,613,582 
Stock Option Vesting Acceleration  0   123,598   0   0   123,598 
Deferred Compensation Vesting Acceleration  0   0   0   0   0 
Payment for Taxes Resulting from Deferred Compensation Distribution  0   34,572   0   0   34,572 
Total  1,000,000   5,396,752   0   2,125,000   5,396,752 


32

W. Michael Kipphut
The following table shows the potential payments upon termination or a change of control of the Company for W. Michael Kipphut, the Company’s Senior Vice President and Chief Financial Officer, as if such termination had occurred on December 31, 2007:
                     
  Company Initiated  Executive Initiated 
  Before
  After
          
  Change in
  Change in
          
  Control
  Control
          
  Termination
  Termination
     Voluntary
    
  w/o Cause
  w/o Cause
     Termination
    
  or for Good
  or for Good
  Voluntary
  for “Good
  Change in
 
  Reason
  Reason
  Termination
  Reason”
  Control
 
Type of Benefit
 ($)  ($)  ($)  ($)  ($) 
 
Severance Pay  368,500   737,000   0   368,500   737,000 
Bonus Payment  221,100   442,200   0   221,100   442,200 
Stock Grants Vesting Acceleration  0   1,222,902   0   0   1,222,902 
Stock Option Vesting Acceleration  0   54,418   0   0   54,418 
Deferred Compensation Vesting Acceleration  0   0   0   0   0 
Payment for Taxes Resulting from Deferred Compensation Distribution  0   108,631   0   0   108,631 
Total  589,600   2,565,151   0   589,600   2,565,151 
Lawrence R. Zingale
The following table shows the potential payments upon termination or a change of control of the Company for Lawrence R. Zingale, the Company’s Senior Vice President — Global Sales and Client Management, as if such termination had occurred on December 31, 2007:
                     
  Company Initiated  Executive Initiated 
  Before
  After
          
  Change in
  Change in
          
  Control
  Control
          
  Termination
  Termination
     Voluntary
    
  w/o Cause
  w/o Cause
     Termination
    
  or for Good
  or for Good
  Voluntary
  for “Good
  Change in
 
  Reason
  Reason
  Termination
  Reason”
  Control
 
Type of Benefit
 ($)  ($)  ($)  ($)  ($) 
 
Severance Pay  305,000   305,000   0   0   0 
Bonus Payment  0   0   0   0   0 
Stock Grants Vesting Acceleration  0   690,174   0   0   690,174 
Stock Option Vesting Acceleration  0   37,204   0   0   37,204 
Deferred Compensation Vesting Acceleration  0   7,758   0   0   7,758 
Payment for Taxes Resulting from Deferred Compensation Distribution  0   7,099   0   0   7,099 
Total  305,000   1,047,235   0   0   742,235 


33

James C. Hobby
The following table shows the potential payments upon termination or a change of control of the Company for James C. Hobby, the Company’s Senior Vice President — Global Operations, as if such termination had occurred on December 31, 2007:
                     
  Company Initiated  Executive Initiated 
  Before
  After
          
  Change in
  Change in
          
  Control
  Control
          
  Termination
  Termination
     Voluntary
    
  w/o Cause
  w/o Cause
     Termination
    
  or for Good
  or for Good
  Voluntary
  for “Good
  Change in
 
  Reason
  Reason
  Termination
  Reason”
  Control
 
Type of Benefit
 ($)  ($)  ($)  ($)  ($) 
 
Severance Pay  305,000   305,000   0   0   0 
Bonus Payment  0   0   0   0   0 
Stock Grants Vesting Acceleration  0   796,896   0   0   796,896 
Stock Option Vesting Acceleration  0   34,012   0   0   34,012 
Deferred Compensation Vesting Acceleration  0   33,351   0   0   33,351 
Payment for Taxes Resulting from Deferred Compensation Distribution  0   70,864   0   0   70,864 
Total  305,000   1,240,123   0   0   935,123 
David L. Pearson
The following table shows the potential payments upon termination or a change of control of the Company for David L. Pearson, the Company’s Senior Vice President and Chief Information Officer, as if such termination had occurred on December 31, 2007:
                     
  Company Initiated  Executive Initiated 
  Before
  After
          
  Change in
  Change in
          
  Control
  Control
          
  Termination
  Termination
     Voluntary
    
  w/o Cause
  w/o Cause
     Termination
    
  or for Good
  or for Good
  Voluntary
  for “Good
  Change in
 
  Reason
  Reason
  Termination
  Reason”
  Control
 
Type of Benefit
 ($)  ($)  ($)  ($)  ($) 
 
Severance Pay  220,000   220,000   0   0   0 
Bonus Payment  0   0   0   0   0 
Stock Grants Vesting Acceleration  0   428,346   0   0   428,346 
Stock Option Vesting Acceleration  0   15,505   0   0   15,505 
Deferred Compensation Vesting Acceleration  0   30,639   0   0   30,639 
Payment for Taxes Resulting from Deferred Compensation Distribution  0   77,129   0   0   77,129 
Total  220,000   771,619   0   0   551,619 


34

EMPLOYMENT AGREEMENTS
Charles E. Sykes.  The Company and Mr. Sykes are parties to an employment agreement, dated August 1, 2004, theas amended on July 28, 2005 to correct a scrivener’s error, and as amended on January 3, 2006 to change his compensation. The material terms and conditions of whichthe agreement as amended are summarized below. The employment agreement replaced his employment agreement dated January 1, 2004, as amended. Under the agreement, Mr. Sykes serves as President and Chief Executive Officer of the Company. The term of the agreement expiresexpired on July 31, 2007, but was automatically renewed, and will continue to be automatically be renewed, for successive one-year terms unless one of the parties provides written notice of its intent not to renew the agreement at least 180 days prior to the expiration of the initial term or any renewal term. Under the agreement, as amended, Mr. Sykes’ annual base salary will be $375,000, subject to increase at the Company’s discretion.is $500,000. Mr. Sykes also is entitled to a performance bonus of up to 60%75% of his base salary based upon the achievement of specifiedsuch goals as may be determined by the Compensation Committee, and to participate in such other bonus programs and benefit plans as are generally made available to other executive officers of the Company.
 
If the agreement is terminated by the Company prior to the expiration of the initial term or anya renewal period for any reason other than death, disability, or cause (as defined in the agreement), or if the agreement is terminated by Mr. Sykes prior to the expiration of the initial term or any renewal period for good reason (as defined below), the Company is required to pay Mr. Sykes an amount equal to his weekly base salary through the end of the initial term or renewal period of the agreement or for 104 weeks, whichever is greater, and during such period Mr. Sykes is prohibited from soliciting the Company’s employees and competing with the Company in any area in which the Company’s clients were conducting business during the initial term or any renewal term of the agreement. If the agreement is terminated by Mr. Sykes following a change in control of the Company (as defined in the agreement) prior to the expiration of the initial term or any renewal period, the Company is required to pay Mr. Sykes an amount equal to his weekly base salary for 156 weeks from the date of termination, rather than 104 weeks, and to pay him an amount determined by multiplying the annual target bonus designated or otherwise indicated for him in the year such change of control occurs by a factor of three, and paying such amount over the 156-week period. Also, in the event the agreement is terminated by Mr. Sykes following a change in control, all stock options, stock grants or other similar equity incentivesand/or compensation programs will immediately accelerate and become fully vested and exercisable at the option of Mr. Sykes upon the event of termination.
 “Good
“Good reason” for Mr. Sykes’ termination of the agreement is defined in the agreement as: (i) a change of control of the Company (as defined in the agreement), (ii) a good faith determination by Mr. Sykes that the Company has breached the employment agreement, (iii) a material adverse change in working conditions or status, (iv) the deletion of, or change in, any of the titles of CEO or President, (v) a significant relocation of Mr. Sykes’ principal office, (vi) a significant increase in travel requirements, or (vii) an impairment of Mr. Sykes’ health to an extent that made the continued performance of his duties under the agreement hazardous to his physical or mental health or his life.
 
The agreement provides that if Mr. Sykes’ employment is terminated by the Company due to his death, disability or for cause, or voluntarily by Mr. Sykes other than for good reason, then the Company will have no obligation to pay him any salary, bonus or other benefits other than those payable through the date of termination, and Mr. Sykes may not solicit any of the Company’s employees or compete directly or indirectly with the Company during the term of the agreement and for a period of one year after its termination, regardless of the reason for its termination. The agreement contains customary confidentiality provisions.
 
W. Michael Kipphut.  The Company and Mr. Kipphut are parties to an employment agreement, dated March 6, 2005, the material terms and conditions of which are summarized below. The employment

26

agreement replaced his employment agreement dated March 6, 2004. The employment agreement provides that Mr. Kipphut will serve as an executive of the Company. Mr. Kipphut serves as Group Executive, Senior Vice President — Finance.Finance and Chief Financial Officer. The initial term of the agreement expiresexpired on March 5,


35

2007, but was automatically renewed, and will continue to be automatically be renewed, for successive one-year terms unless one of the parties provides the other with written notice of its intent not to renew the agreement at least 30 days prior to the expiration of the initial term or anya renewal term. Under the agreement, Mr. Kipphut’s annual base salary is $368,500, subject to increase at the Company’s discretion. Mr. Kipphut also is entitled to a performance bonus up to 60% of his base salary based upon the achievement of specified goals as determined by the Compensation Committee, and to participate in such other bonus programs and benefit plans as are generally made available to other executive officers of the Company.
 
If the agreement is terminated by the Company prior to the expiration of the initial term or anya renewal period for any reason other than death, disability, or cause (as defined in the agreement), or if the agreement is terminated by Mr. Kipphut prior to the expiration of the initial term or any renewal period for good reason (as defined below), the Company is required to pay Mr. Kipphut an amount equal to his weekly base salary through the end of the initial term or renewal period of the agreement or for 52 weeks, whichever is greater, plus an amount equal to the maximum annual performance bonus he could earn (60% of his annual base salary), which would also be paid over the same period as the other payments. If the agreement is terminated by Mr. Kipphut following a change in control of the Company (as defined in the agreement) prior to the expiration of the initial term or any renewal period, the Company is required to pay Mr. Kipphut an amount equal to his weekly base salary for 104 weeks from the date of termination, rather than 52 weeks, plus an amount equal to twice the maximum annual performance bonus he could earn, which would also be paid over the 104-week period. Also, in the event the agreement is terminated by Mr. Kipphut following a change in control, all stock options, stock grants or other similar equity incentivesand/or compensation programs will immediately accelerate and become fully vested and exercisable at the option of Mr. Kipphut upon the event of termination.
 “Good
“Good reason” for Mr. Kipphut’s termination of the agreement is defined in the agreement as: (i) a change of control of the Company (as defined in the agreement), (ii) a good faith determination by Mr. Kipphut that the Company has breached the employment agreement, (iii) a material adverse change in working conditions or status, (iv) the deletion of, or change in, any of the titles of Senior Vice President and Chief Financial Officer, (v) a significant relocation of Mr. Kipphut’s principal office, (vi) a change in reporting such that Mr. Kipphut is required to report to someone other than the CEO, or (vii) a significant increase in travel requirements.
 
The agreement provides that if Mr. Kipphut’s employment is terminated by the Company due to his death, disability or for cause, or voluntarily by Mr. Kipphut other than for good reason, then the Company will have no obligation to pay him any salary, bonus or other benefits other than those payable through the date of termination.
 
The agreement provides that Mr. Kipphut may not solicit any of the Company’s employees or compete directly or indirectly with the Company during the term of the agreement and for one year after its expiration in any area in which the Company’s clients were conducting business during the initial term or any renewal term of the agreement. If the agreement is terminated by the Company or Mr. Kipphut prior to the end of its term, regardless of the reason for its termination the non-solicitation and non-competition provisions will remain in effect through the end of the initial term or renewal period or for 52 weeks after termination, whichever is greater. The agreement contains customary confidentiality provisions.

27

 Gerry L. Rogers. The Company and Mr. Rogers were parties to an employment agreement, dated March 5, 2004, the material terms and conditions of which are summarized below. The Company and Mr. Rogers terminated the agreement on July 30, 2004, in connection with Mr. Rogers’ voluntary retirement, and entered into a consulting agreement signed on July 27, 2004, which agreement was amended effective February 1, 2005. The material terms and conditions of the consulting agreement are summarized below.
Consulting Agreement. The consulting agreement has an effective date of August 2, 2004, and a term of one year. Either party may terminate the agreement at any time on 60 days prior notice, and the Company may terminate the agreement immediately following a breach by Mr. Rogers. The agreement provides that Mr. Rogers will provide services to the Company as an independent contractor on a project-by-project basis, as assigned by the President. He is to be paid a retained fee of $20,000 per month for which he is to perform 180 hours of work per month, as mutually agreed between the parties. Any hours of work above 180 hours per month will be billed by at the rate of $110.00 per hour worked. During the term of the Agreement and through March 5, 2006, Mr. Rogers is prohibited from soliciting the Company’s employees and competing with the Company anywhere in the world. The agreement contains customary confidentiality provisions.
Employment Agreement. The employment agreement had an initial term of two years, and provided that Mr. Rogers would serve as an executive of the Company. Mr. Rogers served as Group Executive, Senior Vice President and Chief Information Officer. The agreement provided that it would automatically renew for successive one-year terms unless one of the parties provided written notice of its intent not to renew at least 180 days prior to the expiration of the initial term or any renewal term. Under the agreement, Mr. Rogers’ annual base salary was set at not less than $233,991, and he was entitled to a performance bonus of up to 75% of his base salary in accordance with the Company’s standard policy for the payment of performance bonuses, and to standard executive fringe benefits.
      The agreement provided that if it was terminated by the Company prior to the expiration of the initial term or any renewal period for any reason other than death, disability, or cause (as defined in the agreement), the Company would be required to pay Mr. Rogers an amount equal to his weekly base salary through the end of the initial term or renewal period of the agreement or for 52 weeks after the termination of the agreement, whichever is greater, and Mr. Rogers would be prohibited from competing with the Company during such period in any area in which the Company’s clients were conducting business during the initial term or any renewal term of the agreement. After the end of the initial term or renewal period of the agreement, the Company could discontinue making such payments if it released Mr. Rogers from the restrictions in the noncompetition provision. The agreement provided that if Mr. Rogers’ employment was terminated by the Company due to his death, disability or cause, or voluntarily by Mr. Rogers, then the Company would have no obligation to pay him any salary, bonus or other benefits other than those payable through the date of termination, and Mr. Rogers may not compete with the Company for a period through the end of the initial term or renewal period of the agreement or for 52 weeks following the termination of his employment, whichever is greater. The agreement also provides that, after termination of his employment for any reason, whether by the Company or Mr. Rogers, Mr. Rogers may not solicit the Company’s employees for the longer of (i) the remaining term of the agreement or (ii) a period of one year after termination of his employment. The agreement contained customary confidentiality provisions.
James T. Holder. The Company and Mr. Holder are parties to an employment agreement, dated April 1, 2003, the material terms and conditions of which are summarized below. The employment agreement provides that Mr. Holder will serve as an executive of the Company. Mr. Holder serves as Vice President, General Counsel and Corporate Secretary. The agreement has an initial term expiring September 30, 2005, and automatically renews for successive one-year terms unless one of the parties provides written notice of its

28

intent not to renew at least 180 days prior to the expiration of the initial term or any renewal term. Under the agreement, Mr. Holder’s annual base salary was to be not less than $190,000 through September 30, 2003, and not less than $205,000 from October 1, 2003 through the end of the term of the agreement, and he is entitled to participate in a performance based bonus program ranging from 0% to 25% of his base salary, and to standard executive fringe benefits.
      If the agreement is terminated by the Company prior to the expiration of the initial term or any renewal period for any reason other than death, disability, or cause (as defined in the agreement), the Company is required to pay Mr. Holder an amount equal to his weekly base salary through the end of the initial term or renewal period of the agreement or for 52 weeks after the termination of the agreement, whichever is greater, and Mr. Holder may not compete with the Company during such period in any area in which the Company’s clients were conducting business during the initial term or any renewal term of the agreement. After the end of the initial term or renewal period of the agreement, the Company may discontinue making such payments if it releases Mr. Holder from the restrictions in the noncompetition provision. The agreement also provides that if Mr. Holder’s employment is terminated by the Company due to his death, disability or cause, or voluntarily by Mr. Holder, then the Company will have no obligation to pay him any salary, bonus or other benefits other than those payable through the date of termination, and Mr. Holder may not compete with the Company for a period through the end of the initial term or renewal period of the agreement or for 52 weeks following the termination of his employment, whichever is greater. The agreement provides that, after termination of his employment for any reason, whether by the Company or Mr. Holder, Mr. Holder may not solicit the Company’s employees for the longer of (i) the remaining term of the agreement or (ii) a period of one year after termination of his employment. The agreement contains customary confidentiality provisions.
James Hobby, Jr.C. Hobby.  The Company and Mr. Hobby are parties to an employment agreement, dated January 3, 2005,2, 2007, the material terms and conditions of which are summarized below. The employment agreement provides that Mr. Hobby will serve as an executive of the Company. Mr. Hobby serves as Senior Vice President, Global Operations. The agreement has an initial term expiring January 2, 2007, but will automatically be renewed for successive one-year periods unlesscontinue until terminated by one of the parties provides written notice of its intent not to renew the agreement at least 180 days prior to the expiration of the initial term or any renewal term.parties. Under the agreement, Mr. Hobby’s annual base salary willis to be not be less than $275,000,$305,000, and he is entitled to participate in a performanceperformance-based bonus of upprogram ranging from 0% to 50% of his base salary in accordance with the Company’s standard policy for the payment of performance bonuses, and to standard executive fringe benefits.


36

If the agreement is terminated by the Company prior to the expiration of the initial term or any renewal period for any reason other than death, disability, or cause (as defined in the agreement), the Company is required to pay Mr. Hobby an amount equal to his weekly base salary through the end of the initial term or renewal period of the agreement or for 52 weeks after the termination of the agreement, whichever is greater, and Mr. Hobby may not compete with the Company during such period in any area in which the Company’s clients were conducting business during the initial term or any renewal term of the agreement. After the end of the initial term or renewal period of the agreement, the Company may discontinue making such payments if it releases Mr. Hobby from the restrictions in the noncompetition provision. The agreement provides that ifIf Mr. Hobby’s employment is terminated by the Company due to his death, disability or cause, or voluntarily by Mr. Hobby, then the Company will have no obligation to pay him any salary, bonus or other benefits other than those payable through the date of termination. In any event, Mr. Hobby may not compete with the Company in any area in which the Company’s clients were conducting business during the term of the agreement, or solicit the Company’s employees, for a period of one year after termination of his employment. The agreement also contains customary confidentiality provisions.
Lawrence R. Zingale.  The Company and Mr. Zingale are parties to an employment agreement, dated April 10, 2008, the material terms and conditions of which are summarized below. The employment agreement provides that Mr. Zingale will serve as an executive of the Company. Mr. Zingale serves as Senior Vice President, Global Sales and Client Management. The agreement continues until terminated by one of the parties. Under the agreement, Mr. Zingale’s annual base salary is to be not less than $322,000 through the end of the term of the agreement, and he is entitled to participate in a performance based bonus program ranging from 0% to 50% of his base salary, and to standard executive fringe benefits.
If the agreement is terminated by the Company for any reason other than death, disability, or cause (as defined in the agreement), the Company is required to pay Mr. Zingale an amount equal to his weekly base salary for 52 weeks after the termination of the agreement. If Mr. Zingale’s employment is terminated by the Company due to his death, disability or cause, or voluntarily by Mr. Zingale, then the Company will have no obligation to pay him any salary, bonus or other benefits other than those payable through the date of termination. In any event, Mr. Zingale may not compete with the Company in any area in which the Company’s clients were conducting business during the term of the agreement, or solicit the Company’s employees, for a period of one year after termination of his employment. The agreement also contains customary confidentiality provisions.
David L. Pearson.  The Company and Mr. Pearson are parties to an employment agreement, dated September 20, 2005, as amended on October 1, 2007 and January 3, 2008 to change his compensation, the material terms and conditions of which are summarized below The employment agreement provides that Mr. Pearson will serve as an executive of the Company. Mr. Pearson serves as Senior Vice President, Information Technology. The agreement had an initial term which expired on September 19, 2006, but was automatically renewed, and will continue to automatically renew, for successive one-year terms unless one of the parties provides written notice of its intent not to renew at least 180 days prior to the expiration of a renewal term. Under the agreement, Mr. Pearson’s annual base salary is to be not less than $231,000 through the end of the term of the agreement, and he is entitled to participate in a performance based bonus program ranging from 0% to 50% of his base salary, and to standard executive fringe benefits.
If the agreement is terminated by the Company prior to the expiration of the renewal period for any reason other than death, disability, or cause (as defined in the agreement), the Company is required to pay Mr. Pearson an amount equal to his weekly base salary for 52 weeks after the termination of the agreement, and Mr. Pearson may not compete with the Company during such period in any area in which the Company’s clients were conducting business during the initial term or any renewal term of the agreement. The agreement also provides that if Mr. Pearson’s employment is terminated by the Company due to his death, disability or cause, or voluntarily by Mr. Pearson, then the Company will have no obligation to pay him any salary, bonus or other benefits other than those payable through the date of termination, and Mr. HobbyPearson may not compete with the Company for a period through the end of the initial term or renewal period of the agreement or for 52 weeks following the termination of his employment, whichever is greater. The agreement provides that, after termination of his employment for any reason, whether by the Company or Mr. Hobby,Pearson, Mr. HobbyPearson may not solicit the

29

Company’s employees for the


37

longer of (i) the full statedremaining term or renewal period of the agreement or (ii) a period of 52 weeksone year after termination of his employment. The agreement contains customary confidentiality provisions.
William N. Rocktoff.
DIRECTOR COMPENSATION
Directors who are executive officers of the Company receive no compensation for service as members of either the Board of Directors or any committees of the Board.
2004 Non-Employee Director Fee Plan
In May 2005, the shareholders of the Company approved the 2004 Non-Employee Director Fee Plan (the “2004 Fee Plan”). The Company and Mr. Rocktoff are parties to2004 Fee Plan provides that all new non-employee directors joining the Board will receive an employment agreement, dated April 1, 2003,initial grant of common stock units (“CSUs”) on the material terms and conditionsdate the new director is appointed or elected, the number of which are summarized below. The employment agreement provides that Mr. Rocktoff will serve as an executive of the Company. Mr. Rocktoff serves as Vice President and Corporate Controller. The agreement has an initial term expiring September 30, 2005, but will automatically be renewed for successive one-year periods unless one of the parties provides written notice of its intent notdetermined by dividing a dollar amount to renew the agreement at least 180 days priorbe determined from time to the expiration of the initial term or any renewal term. Under the agreement, Mr. Rocktoff’s annual base salary will not be less than $150,000, and he is entitled to a performance bonus of up to 30% of his base salary in accordance with the Company’s standard policy for the payment of performance bonuses, and to standard executive fringe benefits. Mr. Rocktoff’s annual base salary was increased to $182,000 effective as of April 20, 2004.
      If the agreement is terminatedtime by the Company prior to the expiration of the initial term or any renewal period for any reason other than death, disability, or cause (as defined in the agreement), the Company is required to pay Mr. RocktoffBoard (initially set at $30,000) by an amount equal to his weekly base salary through110% of the closing price of the Company’s common stock on the date the new director is appointed or elected. The initial grant of CSUs will vest in three equal installments, one-third on the date of each of the following three annual shareholders’ meetings. A CSU is a bookkeeping entry on the Company’s books that records the equivalent of one share of common stock. On the date each CSU vests, the director will become entitled to receive a share of the Company’s common stock and the CSU will be canceled.
Additionally, the 2004 Fee Plan provides that each non-employee director will receive, on the day after the annual meeting, an annual retainer for service as a non-employee director, the amount of which shall be determined from time to time by the Board. Under the 2004 Fee Plan, the annual retainer will be paid 75% in CSUs and 25% in cash. The number of CSUs to be granted under the 2004 Fee Plan will be determined by dividing the amount of the annual retainer by an amount equal to 105% of the closing price for the Company’s common stock on the award date (the day after the annual meeting). The annual grant of CSUs will vest in two equal installments, one-half on the date of each of the following two annual shareholders’ meetings. All CSUs will automatically vest upon the termination of a director’s service as a director, whether by reason of death, retirement, resignation, removal or failure to be reelected at the end of his or her term. Until a CSU vests, the director has none of the rights of a shareholder with respect to the CSU or the common stock underlying the CSU. CSUs are not transferable.
The Compensation and Human Resource Development Committee reviews Board compensation on an annual basis and makes recommendations to the full Board which is responsible for the final determination as to Board compensation. For 2006 and 2007, the Compensation Committee and the Board have established the annual retainer fee for non-employee directors at $50,000. Any non-employee Chairman of the Board receives additional annual cash compensation in the amount of $100,000. The Chairperson of the Audit Committee receives additional annual cash compensation in the amount of $10,000, and the Chairpersons of the Compensation and Human Resource Development Committee and the Nominating and Corporate Governance Committee each receive additional annual cash compensation in the amount of $5,000. The Chairperson of any Special Committee appointed by the Chairman of the Board will receive an additional cash payment of $2,000 at the formation of the Special Committee.
In addition to the initial termgrant of CSUs and the annual retainer, each non-employee director receives a cash payment of $1,250 for each dayhe/she attends committeeand/or board meetings, and a cash payment of $500 for each Board or renewal periodCommittee teleconference that lasts longer than one hour.
In March, 2008, the Compensation and Human Resource Committee recommended to the Board, and the Board adopted, amendments to the 2004 Fee Plan which provided that the initial grant of CSUs to directors joining the Board, as well as annual retainer grants of cash and CSUs, will vest and be earned in equal quarterly installments


38

over the term of the agreement orgrant (three years for 52 weeks afterthe initial grant, and two years for annual grants) instead of being earned at the time of grant. Accordingly, beginning with grants in 2008, unvested and unearned CSUs will not automatically vest upon the termination of the agreement, whichever is greater, and Mr. Rocktoff may not compete with the Company during such period in any area in which the Company’s clients were conducting business during the initial terma director’s service as a director, whether by reason of death, retirement, resignation, removal or any renewal term of the agreement. Afterfailure to be reelected at the end of his or her term.
The following table contains information regarding compensation paid to the initial term or renewal periodnon-employee directors during fiscal year ending December 31, 2007, including cash and restricted stock units.
                             
(a) (b)  (c)  (d)  (e)  (f)  (g)  (h) 
              Change in
       
              Pension
       
              Value and
       
              Nonqualified
       
  Fees Earned
        Non-Equity
  Deferred
       
  or Paid in
  Stock
  Option
  Incentive Plan
  Compensation
  All Other
    
  Cash
  Awards
  Awards
  Compensation
  Earnings
  Compensation
  Total
 
Name
 ($)(1)  ($)(2)  ($)  ($)  ($)  ($)  ($) 
 
Furman P. Bodenheimer, Jr.   24,750   92,293   —   —   —   —   117,043 
Mark C. Bozek  32,500   68,256   —   —   —   —   100,756 
Lt. Gen. Michael DeLong (Ret)  24,750   68,256   —   —   —   —   93,006 
H. Parks Helms  32,750   80,274   —   —   —   —   113,024 
Iain Macdonald  26,500   72,677   —   —   —   —   99,177 
James S. MacLeod  25,000   80,443   —   —   —   —   105,443 
Linda McClintock-Greco, M.D.   23,750   68,256   —   —   —   —   92,006 
William J. Meurer  40,250   68,256   —   —   —   —   108,506 
James K. Murray, Jr.   25,250   80,443   —   —   —   —   105,693 
Paul L. Whiting  127,250   68,256   —   —   —   —   195,506 
(1)Amounts shown include the cash portion ($12,500) of the annual retainer paid to each non-employee director in 2007, as well as all meeting fees paid. The fees earned by Mr. Whiting include $100,000 for service as Chairman of the Board. The fees earned by Mr. Meurer, Mr. Bozek and Mr. Helms include $10,000, $5,000 and $5,000 respectively, for service as a Committee Chair.
(2)As required by relevant SEC rules, the amounts shown are the compensation costs recognized by the Company for financial reporting purposes in 2007 for restricted stock unit awards as determined pursuant toShare-Based Payment,SFAS No. 123(R). These compensation costs reflect restricted stock unit awards granted in 2005, 2006 and 2007. See Notes 1 and 23 of the Notes to our Consolidated Financial Statements included in our Annual Report onForm 10-K for the year ended December 31, 2007 for a discussion of the relevant assumptions used in calculating this amount. Each of our non-employee directors received 1,851 restricted stock units as the stock portion of their annual retainer in 2007, with an individual grant date fair value of $35,521. As of December 31, 2007, our non-employee directors held the following number of options and restricted stock units: Furman P. Bodenheimer, Jr. 47,953, Mark C. Bozek 12,953, Lt. Gen. Michael DeLong (Ret) 11,286, H. Parks Helms 20,453, Iain Macdonald 2,953, James S. MacLeod 2,953, Dr. Linda McClintock-Greco 20,453, William J. Meurer 30,453, James K. Murray, Jr. 2,953 and Paul L. Whiting 27,953.


39

SECURITY OWNERSHIP
Security Ownership of Directors and Executive Officers
The following table sets forth the beneficial ownership of the agreement,Company’s common stock as of April 11, 2008, for each director, each executive officer named in the Summary Compensation Table herein, and by all directors and executive officers of the Company may discontinue making such payments if it releases Mr. Rocktoffas a group.
                         
           Stock Settled
       
           Stock
       
           Appreciation
       
        Options
  Rights
       
        Currently
  Vested and
  Total Stock
  Percent of
 
        Exercisable or
  Vesting
  and Stock
  Total
 
  Common
  Common
  Exercisable
  Within 60
  Based
  Outstanding
 
Name
 Stock  Stock Units(1)  Within 60 Days  Days(2)  Holdings  Stock 
 
Furman P. Bodenheimer, Jr.   75,336   2,027   45,000   0   122,363   * 
Mark C. Bozek  6,200   2,027   10,000   0   18,227   * 
Lt. Gen. Michael DeLong (Ret)  10,200   2,027   8,333   0   20,560   * 
H. Parks Helms(3)  18,224   2,027   17,500   0   37,751   * 
Iain Macdonald  11,777   2,027   0   0   13,804   * 
James S. MacLeod  9,846   3,070   0   0   12,916   * 
Linda McClintock-Greco, M.D.   18,421   2,027   17,500   0   37,948   * 
William J. Meurer  44,291   2,027   27,500   0   73,818   * 
James K. Murray, Jr.(4)  15,346   3,070   0   0   18,416   * 
Charles E. Sykes(5)  199,210   0   0   4,898   204,108   * 
Paul L. Whiting(6)  113,096   2,027   25,000   0   140,123   * 
W. Michael Kipphut(7)  94,684   0   110,000   2,155   206,839   * 
Lawrence R. Zingale(8)  55,411   0   0   1,472   56,883   * 
James C. Hobby(9)  53,340   0   0   1,327   54,667   * 
David L. Pearson(10)  31,553   0   20,300   614   52,467   * 
All directors and executive officers as a group — 18 persons  805,013   22,356   309,633   9,862   1,146,864   2.77%
* Less than 1.0%
(1)Represents stock settled Common Stock Units granted pursuant to the 2004 Non-Employee Director Fee Plan that will vest within 60 days of the date of this proxy statement.
(2)Shares of common stock which may be acquired within sixty days upon the exercise of stock appreciation rights (“SARs”), assuming that the fair market value of a share of the Company’s stock (as defined in the 2001 Equity Incentive Plan) is $17.25 on the date of exercise. The SARs represent the right to receive that number of shares of common stock determined by dividing (i) the total number of shares of stock subject to the SARs being exercised, multiplied by the amount by which the fair market value (as defined in the Plan) of a share of


40

stock on the day the right is exercised exceeds the fair market value of a share of stock on the date of grant of the SAR, by (ii) the fair market value of a share of stock on the exercise date.
(3)Excludes 600 shares held by Mr. Helms’ spouse over which Mr. Helms disclaims beneficial ownership.
(4)Excludes 1,000 shares held by a family member in which Mr. Murray disclaims beneficial ownership.
(5)Includes 181,159 shares of restricted stock issued as part of the various equity-based, long-term incentive awards and 18,333 shares owned by a trust of which Mr. Sykes is a beneficiary.
(6)Includes 113,096 shares owned jointly by Mr. Whiting and other family members. Excludes 300 shares of common stock held by Mr. Whiting’s wife in which Mr. Whiting disclaims beneficial ownership.
(7)Includes 92,684 shares of restricted stock issued as part of the various equity-based, long-term incentive awards.
(8)Includes 55,411 shares of restricted stock issued as part of the various equity-based, long-term incentive awards.
(9)Includes 53,340 shares of restricted stock issued as part of the various equity-based, long-term incentive awards.
(10)Includes 31,553 shares of restricted stock issued as part of the various equity-based, long-term incentive awards.
Security Ownership of Certain Beneficial Owners
As of April 11, 2008, the Company’s records and other information available from outside sources indicated that the restrictionsfollowing shareholders were beneficial owners of more than five percent of the outstanding shares of the Company’s common stock. The information below is as reported in their filings with the noncompetition provision.Securities and Exchange Commission. The agreement provides that if Mr. Rocktoff’s employmentCompany is terminated bynot aware of any other beneficial owner or more than 5% of the Company dueCompany’s common stock.
         
  Amount and Nature of Beneficial Ownership Common Stock
Name
 Shares Percent
 
John H. Sykes(1)  7,289,924   17.73 
Wells Fargo & Company(2)  3,583,560   8.72 
420 Montgomery Street
San Francisco, CA 94163		        
BlackRock, Inc.(3)  2,887,348   7.02 
40 East 52nd Street
New York, New York, 10022		        
(1)Represents shares owned by Mr. John Sykes through Jopar Investments Limited Partnership, a North Carolina limited partnership in which Mr. Sykes is the sole limited partner and the sole shareholder of the limited partnership’s sole general partner. Excludes 7,950 shares owned by Mr. Sykes’ wife, as to which Mr. Sykes disclaims beneficial ownership. Mr. Sykes’ business address is P.O. Box 2044, Tampa, Florida33601-2044.
(2)All information is based upon the Schedule 13G filed with the Security and Exchange Commission by Wells Fargo & Company (“Wells Fargo”) on February 4, 2008. Wells Fargo is a parent holding company registered under Section 240 of the Investment Advisors Act of 1940. Wells Fargo filed the Schedule 13G on its own behalf and on behalf of three subsidiaries which are classified as investment advisors, and one subsidiary that is


41

classified as a bank. Aggregate beneficial ownership reported by Wells Fargo & Company is on a consolidated basis and includes any beneficial ownership separately reported therein by a subsidiary.
(3)All information is based upon the Schedule 13G filed with the Security and Exchange Commission by BlackRock, Inc. (“BlackRock”) on February 8, 2008. BlackRock is a parent holding company and a registered investment advisor under Section 240 of the Investment Advisors Act of 1940. BlackRock filed the Schedule 13G on its own behalf, and on behalf of five investment management subsidiaries, all of which are classified as investment advisors. Aggregate beneficial ownership reported by BlackRock is on a consolidated basis and includes any beneficial ownership separately reported therein by a subsidiary.
PROPOSAL 2
RATIFICATION OF THE APPOINTMENT OF INDEPENDENT AUDITORS
The Audit Committee engaged Deloitte & Touche LLP as the Company’s independent auditors to his death, disability or cause, or voluntarily by Mr. Rocktoff, thenaudit the Company will have no obligation to pay him any salary, bonus or other benefits other than those payable through the date2008 consolidated financial statements of termination, and Mr. Rocktoff may not compete with the Company for a period through the endyear ended December 31, 2008 and the effectiveness of the initial term or renewal periodCompany’s internal control over financial reporting as of December 31, 2008 and express an opinion thereon, and issue an attestation report on management’s assessment of the agreement or for 52 weeks followingeffectiveness of the terminationCompany’s internal control over financial reporting as of his employment, whichever is greater. The agreement provides that, after termination of his employment for any reason, whether byDecember 31, 2008. Although the Company or Mr. Rocktoff, Mr. Rocktoff mayis not solicitrequired to seek shareholder ratification of this appointment, the Board believes it to be sound corporate governance to do so. If the appointment is not ratified, the Audit Committee will reconsider the appointment, but will not be required to engage a different auditing firm.
Representatives of Deloitte & Touche are expected to be present at the Annual Meeting. Those representatives will have the opportunity to make a statement if they so desire and are expected to be available to respond to appropriate questions.
The Board of Directors recommends a vote “FOR” this proposal and urges each shareholder to vote “FOR” ratification of the appointment of Deloitte & Touche LLP as the Company’s employees forindependent auditors. Executed and unmarked proxies in the longeraccompanying form will be voted at the Annual Meeting in favor of (i) the full stated term or renewal periodratification.
AUDIT COMMITTEE DISCLOSURE
The Audit Committee is comprised solely of the agreement or (ii) a period of 52 weeks after termination of his employment. The agreement contains customary confidentiality provisions.independent directors and, among other things, is responsible for:
 John H. Sykes. On August 2, 2004, John H. Sykes publicly announced his resignation and retirement as Chairman and Chief Executive Officer of the Company. Mr. Sykes founded the Company in September 1977 and served the Company in an executive officer position for 27 years. Mr. Sykes was employed at such time by the Company pursuant to the Amended and Restated Executive Employment Agreement, dated as of October 1, 2001, described below. The employment agreement had an initial term of five years, expiring on October 1, 2006.
      As a result of Mr. Sykes’ resignation prior to the end of the initial term of the employment agreement, the Company and Mr. Sykes terminated the employment agreement and entered into a Retirement and Consulting Agreement, dated December 10, 2004, the material terms and conditions of which are summarized below:
 • Mr. Sykes’ resignationServing as an employee ofindependent and objective party to monitor the Company was to be effective as of December 31, 2004.Company’s financial reporting process and internal control system.
 
 • The Company agreed to allappointment, compensation, and benefits due under his employment agreement through December 31, 2004.

30

• Theoversight of the work of the registered public accounting firm employed by the Company agreed that on(including resolution of disagreements between management and the auditor regarding financial reporting) for the purpose of preparing or promptly after December 31, 2004, it would pay to Mr. Sykes a lump sum of $1,352,695.51 in base severance pay, which amount is equalissuing an audit report or related work, and each such registered public accounting firm reports directly to the annual base salary payable under his employment agreement for the period from the December 31, 2004, through the termination date of the employment agreement, September 30, 2006.Audit Committee.
 
 • Because Mr. Sykes relinquished any rights he may have had under the employment agreement to an officeReviewing and secretary for the rest of his life, and the right to continue to be covered as an employee underappraising the Company’s group health insurance policy, as well as other possible benefits associated with continued employment, the Company agreed to pay on or promptly after December 31, 2004, a lump sum of $300,000 to Mr. Sykes.internal auditing function.
 
 • The Company agreed to pay on or promptly after December 31, 2004, $68,750 for his unused vacation benefits earned through December 31, 2004.
• Mr. Sykes may exercise his existing stock options in accordance with the terms and conditionsProviding an open avenue of his stock option agreements andcommunication among the Company’s existing stock option plan.
• Mr. Sykesregistered public accounting firm, financial and his qualified dependents, as determined by the Company, may participatesenior management, those involved in the Company’s health insurance plan at their own expense.
• The Company will provide Mr. Sykes with a secretaryinternal auditing function, and an office at the Company’s headquarters in Tampa, Florida, to facilitate a reasonable management transition.Board of Directors.


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 During the period from December 31, 2004, through October 1, 2006, the Company will pay Hyde Park Equity, LLC, a limited liability company owned by Mr. Sykes, fees
Policy on Audit Committee Pre-Approval of $150,000, in seven equal quarterly installmentsAudit and Permissible Non-Audit Services of $21,428, for consultingIndependent Auditors
The Audit Committee’s policy is to pre-approve all audit and permissible non-audit services to be provided by Mr. Sykes through Hyde Park Equity. In the eventindependent auditors which exceed $50,000. These services may include audit services, audit-related services, tax services and other services. The Chairman of Mr. Sykes’ death priorthe Audit Committee has been given the authority to October 1, 2006,grant pre-approvals, and each such pre-approval is then submitted to the Company shall pay onlyfull Committee at the next meeting for consideration and approval. Pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is generally subject to a pro rata amountspecific budget. The independent auditors and management are required to periodically report to the Audit Committee regarding the extent of services provided by the independent auditors in accordance with this pre-approval, and the fees for the quarter in which Mr. Sykes dies, and nothing further shall be owedservices performed to date.
Service Fees Paid to the Independent Registered Public Accounting Firm
The fees charged by Deloitte & Touche LLP for consulting services. For such amount, Hyde Park Equity will cause Mr. Sykes to provide up to 37.5 days of consultingprofessional services per year at the request of the Board of Directors or its Chairman. Such services will include advice dealing with significant business issues and an orderly management transition. Additional days of service will be billed at $2,000 per day. The Company will also reimburse Hyde Park Equity for out of pocket business expenses incurredrendered in connection with providing services toall audit and non-audit related matters for the Company.
      Under the retirement and consulting agreement, Mr. Sykes agreed not to compete with the Company for a period fromyears ended December 31, 2004, through October 1, 2006 within the geographic areas where the Company markets its services2007 and products, including but not limited to the continental United States, with certain limited exceptions including a temporary personnel staffing business.
Employment Agreement. The Company and Mr. Sykes were parties to an amended and restated employment agreement, dated October 1, 2001, the material terms and conditions of which are summarized below. The employment agreement provided for an initial term of five years and automatic renewals for successive one-year terms, unless terminated by either party with 180 day’s prior notice. Under the agreement, Mr. Sykes’ initial base salary was set at $550,000 until December 31, 2002, with the base salary increasing2006 were as determined by the Board of Directors. The employment agreement provided that the annual base salary would be increased at least 30% on October 1, 2003, increased by at least another 15% on the fourth anniversary of the agreement (October 1, 2005), and increased by at least another 15% on each bi-annual (i.e. two year) anniversary thereafter. Mr. Sykes was also entitled to performance bonuses as determined by the Compensation Committee and to participate in such bonus programs and other benefit plans as are generally made available to other executive officers of the Company. Additionally, at the end of each fiscal year, the Board of

31

Directors, in their discretion, could award Mr. Sykes a bonus based upon his performance during such fiscal year.follows:
 Due to the enactment of the Sarbanes-Oxley Act of 2002 in June 2002 and changes in the law related to split dollar life insurance premiums and benefits, the Compensation and Human Resource Development Committee determined in 2002 that it was in the best interest of the Company and Mr. John Sykes for the Company to cease making premium payments on the split dollar insurance policies on Mr. John Sykes’ life, and instead to increase Mr. Sykes’ compensation by an amount equal to those premium payments, grossed up for tax effect. Accordingly, effective January 1, 2003, Mr. Sykes’ base compensation was increased from $550,000 to $792,478, and he was responsible for making all future premium payments on those split dollar life insurance policies. The Company is entitled to recover out of the death benefits payable under the policies an amount equal to the premiums previously paid by the Company.
         
  2007  2006 
 
Audit Fees(1) $2,984,332  $3,032,776 
Audit-Related Fees(2) $-0-  $34,678 
Tax Fees $-0-  $-0- 
All Other Fees(3) $101,000  $-0- 
 The employment agreement provided that if the agreement was terminated by the Company for any reason other than for cause (as defined therein), death or disability, the Company would continue to pay the full amount of Mr. Sykes’ annual base salary throughout the initial term or any successor term. Mr. Sykes was also to continue to receive the full amount of his annual base salary throughout the initial term or any successor term in the event there is: (i) a change of control, (ii) a good faith determination by Mr. Sykes that the Company had breached the employment agreement, (iii) a material adverse change in working conditions or status, (iv) the deletion of, or change in, any of the titles of Chairman of the Board, CEO or President, (v) a significant relocation of Mr. Sykes’ principal office, (vi) a significant increase in travel requirements, or (vii) an impairment of Mr. Sykes’ health to an extent that made the continued performance of his duties under the agreement hazardous to his physical or mental health or his life. During the term of his employment with the Company, Mr. Sykes was prohibited from competing with the Company in any area in which the Company’s business was then conducted. The agreement contained customary confidentiality provisions.
 The employment agreement also provided that upon its termination for any reason, including cause, benefits would continue during the lifetime of Mr. Sykes and the lifetime of his spouse if he was married at the time of his death. Benefits include all employee benefit plans and programs in which Mr. Sykes was entitled to participate immediately before termination. Further, if the Company determined that resources were then reasonably available, the Company would also provide Mr. Sykes with an office and a secretary at the Company’s headquarters.
      Upon Mr. John Sykes’ retirement, the Company’s Board of Directors recognized his contribution to the Company as its founder and Chairman of the Board for over twenty six years, by naming Mr. John Sykes as honorary “Chairman Emeritus.” In this capacity, Mr. Sykes may be invited to Board meetings, but will not have a vote on matters before the Board.

32

EQUITY COMPENSATION PLAN INFORMATION
      The following table summarizes the equity compensation plans under which the equity securities of Sykes may be issued as of December 31, 2004:
             
  (a) (b) (c)
       
      Number of Securities
  Number of   Remaining Available for
  Securities to be Weighted Future Issuance Under
  Issued Upon Average Exercise Equity Compensation
  Exercise of Price of Outstanding Plans (Excluding
  Options, Warrants Options, Warrants Securities Reflected
  and Rights and Rights in Column (a))
       
Equity compensation plans approved by shareholders(1)
  2,777,013  $10.12(2)  5,231,300 
Equity compensation plans not approved by shareholders  55,884(3)      N/A(3)
          
Totals  2,832,897       5,231,300 
          
(1)Includes sharesFees for audit services in 2007 and 2006 consisted of common stock of Sykes authorized for awards under the 2001 Equity Incentive Plan as well as the 2000 Stock Option Plan, the 1996 Employee Stock Option Plan, and the 1997 Management Stock Incentive Plan, all of which are predecessor plans to the 2001 Equity Incentive Plan. Also includes shares of common stock of Sykes reserved for issuance under the 1999 Employees’ Stock Purchase Plan, the Amended and Restated 1996 Non-Employee Director Stock Option Plan, the 1996 Non-Employee Director Fee Plan, and the 2004 Non-Employee Director Stock Option Plan. Implementation(a) audits of the 2004 Non-Employee Director Stock Option Plan was suspended byCompany’s annual consolidated financial statements and internal controls over financial reporting, (b) reviews of the Board of Directors when it approved the 2004 Non-Employee Director Fee Plan in May 2004. The 2004 Non-Employee Director Stock Option Plan will be terminated if the 2004 Non-Employee Director Fee Plan is approved by the shareholders at the Annual Meeting. See “Directors’ Compensation” above.Company’s quarterly condensed consolidated financial statements, and (c) annual stand alone statutory audits.
 
(2)Represents the weighted average exercise priceFees for audit related services in 2006 consisted of stock options only.(a) audit of employee benefit plans and (b) agreed upon procedures engagements.
 
(3)Represents shares of common stock of Sykes issued as matching grants under the Deferred Compensation Plan for executives described below. There is no specific number of shares reserved for issuance under the Deferred Compensation PlanAll Other Fees in 2007 principally included assistance with responding to SEC comment letters.
 Shares awarded under all
Report of the above compensation plans mayAudit Committee
In connection with the financial statements for the fiscal year ended December 31, 2007, the Audit Committee has:
(1) reviewed and discussed the audited financial statements with management,
(2) discussed with Deloitte & Touche LLP, the Company’s independent registered public accounting firm (the “Auditors”), the matters required to be discussed by the statement on Auditing Standards No. 61, as amended, and
(3) received the written disclosure and letter from Sykes’ authorizedthe Auditors required by Independence Standards Board Standard No. 1 and un-issued shares or treasury shares. For a summaryhas discussed with the Auditors the Auditors’ independence.
Based upon these reviews and discussions, the Audit Committee recommended to the Board at the March 26, 2008 meeting of the terms of Sykes’ stock option plans, see Note 19 of our consolidatedBoard that the Company’s audited financial statements be included in the Annual Report onForm 10-K and incorporated herein by reference.
Executive Deferred Compensation Plan
      The Company adopted the Deferred Compensation Plan effective December 17, 1998, as an unfunded deferred compensation arrangement for a select group of management or highly compensated personnel. Compensation deferred by a participant while he is a participant in the Plan is deferred until such participant’s retirement, termination, disability or death, or a change in control of the Company, as defined in the Plan, and in such event is paid out to the participant or his beneficiary.
      Participants in the Plan may elect to defer any amount of base compensation and bonus. The Company matches a portion of amounts deferred by a participant on a quarterly basis as follows: 50% match on salary deferred, up to a total match of $12,000.00 per year for senior vice presidents and $7,500.00 per year for vice

33

presidents and other participants. The total amount of the matching contribution made to the Plan is made in the form of Sykes common stock.
      With respect to the distribution of the participant’s matching contribution, a participant may elect a distribution of the Sykes common stock in the participant’s deferred compensation account, or a distribution of the cash value of the common stock in the participant’s account. The distribution of any matching contribution made by the Company and earnings attributable thereto will be paid as soon as administratively feasible twelve months after retirement or termination of employment. Alternatively, a participant may, at the time of initial participation in the Plan, elect to receive benefits under the Plan in the event of retirement or disability in 120 monthly installments of an amount equal to the fair market value of the assets in the participant’s deferred compensation account as of the effective date of his retirement or termination of employment due to disability.
      In the event the participant terminates employment (for reasons other than death, disability or retirement) without participating in the plan for three years, the matching contributions and earnings attributable thereto are forfeited. In the event that a participant terminates employment after three years, but less than six years of participation in the Plan, the participant forfeits 75% of the matching contribution and earnings. In the event a participant terminates employment after six years but less than ten years of participation in the Plan, the participant forfeits 50% of the matching contribution and earnings.
      In the event of a distribution of benefits as a result of a change in control, the Company will increase the benefit by an amount sufficient to offset the income tax obligations created by the distribution of benefits.
      Participants forfeit undistributed matching contributions if the participant is terminated for “cause” as defined in the Plan or the participant enters into a business or employment which the CEO determines to be in violation of any non-compete agreement between the participant and the Company.
COMPENSATION AND HUMAN RESOURCE DEVELOPMENT COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
Introduction
      Under rules of the Commission, the Company is required to provide certain information concerning compensation provided to the Company’s Chief Executive Officer and its other executive officers. The disclosure requirements for the executive officers include the use of tables and a report of the Committee responsible for compensation decisions for the named executive officers explaining the rationale and considerations that led to those compensation decisions. Therefore, the Compensation and Human Resource Development Committee of the Board of Directors has prepared the following report for inclusion in this Proxy Statement.
Compensation and Human Resource Development Committee Role
      The Compensation and Human Resource Development Committee of the Board of Directors has the responsibility to review annually and recommend to the full Board, the compensation for the Chief Executive Officer as well as the other executive officers. The forms of compensation considered by the Committee include base salary, annual and performance based cash bonuses and fringe benefits. The Company’s Stock Option Committee, a subcommittee of the Compensation and Human Resource Development Committee, is responsible for reviewing the equity incentive component of the Company’s compensation program for its

34

employees generally, and specifically its executive officers, including the named executive officers. The Stock Option Committee is responsible for making stock option grants under the Company’s 2001 Equity Incentive Plan to executive officers of the Company. The Committee and the Stock Option Committee are comprised of members of the Board who are not employees of the Company. Although these committees consider different components of the executive employees’ compensation, they are currently comprised of the same non-employee Board members.
Compensation Philosophy
      The Committee’s philosophy on executive compensation is based upon several fundamental concepts. First, the Committee believes that the level of individual compensation should be competitive with selected survey groups. Second, compensation generally, and bonus compensation specifically, should be designed to provide significant incentives for superior personal and corporate performance. Third, the executive’s compensation package should be designed to align the interests of the executive with that of the Company’s shareholders. The Committee believes that executive compensation, if determined in accordance with this philosophy, will enable the Company to attract and retain the services of highly qualified and motivated executives. These goals are achieved by designing executive compensation packages that include a base salary, discretionary and performance based cash bonuses and periodic grants of stock options. The Company’s policies with respect to these elements, including the basis for the compensation awarded the Company’s chief executive officer, are discussed below.
      The Committee oversees the operation of the Company’s executive compensation policies. The Company occasionally retains independent compensation consultants, and regularly utilizes published surveys with industry, geographical and position specific data to compare the Company’s compensation programs with various other companies with similar characteristics. While the elements of compensation described below are considered separately, the Committee takes into account the full compensation package offered by the Company to the individual, including health care and other insurance benefits and contributions made by the Company under the Company’s 401(k) Plan, Employee Stock Purchase Plan and Deferred Compensation Plan.
Base Salaries. The Company has established competitive annual base salaries for all executive officers, including the named executive officers. The annual base salaries for each of the Company’s executive officers, including the Company’s chief executive officer, reflect the subjective judgment of the Committee based on their consideration of the executive officer’s position with the Company, the executive officer’s tenure, the Company’s needs, a comparative analysis of published compensation data as described above, and the executive officer’s individual performance, achievements, and contributions to the growth of the Company.
      Mr. John H. Sykes’ annual base salary for 2004, as the Company’s Chief Executive Officer, was $957,478. This amount reflects the original base salary of $550,000, increased by 30% on October 1, 2003, all as set forth in Mr. Sykes’ employment agreement, and adjusted by $242,478 effective January 1, 2003 to provide for the payment of premiums on split dollar life insurance policies as described above in the section entitled “Employment Agreements.”
      Mr. Charles Sykes’ annual base salary for 2004 as the Company’s Chief Executive Officer, was $375,000. Mr. Charles Sykes’ annual salary as of January 1, 2004 was $300,000. His annual salary was raised to $350,000 on May 7, 2004 upon appointment as the President and Chief Operating Officer, and then was raised again to its current level of $375,000 on August 1, 2004 upon his appointment as Chief Executive Officer.

35

Annual Bonus. The Company’s executive officers are eligible for an annual cash bonus under the Company’s Bonus Program. The Bonus Program provides for the discretionary payment of annual incentive awards to key employees, including executive officers of the Company, pursuant to individually developed formulas related to the Company’s operating goals and personal performance goals. Payments under the Bonus Program are discretionary and are subject to certain limitations. Mr. John H. Sykes did not receive any cash bonuses during the year ended December 31, 2004. Mr. Charles Sykes received a cash bonus of $52,713 during the year ended December 31, 2004.
Stock Options. Under the Company’s 2001 Equity Incentive Plan (the “2001 Plan”), stock options may be granted to all employees. The 2001 Plan is administered by the Compensation and Human Resource Development Committee in accordance2007 filed with Rule 16b-3 of the Securities and Exchange Act of 1934, as amended.Commission. The Compensation and Human Resource Development Committee recommended that no stock options under the 2001 Plan be made available for issuance during the year ended December 31, 2004. Accordingly, no stock options were awarded to executive officers in 2004.Board has approved this inclusion.


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Section 162(m) Limitations
AUDIT COMMITTEE
 Under Section 162(m) of the Internal Revenue Code, a tax deduction by corporate taxpayers, such as the Company, is limited with respect to the compensation of certain executive officers, unless such compensation is based upon performance objectives meeting certain regulatory criteria or is otherwise excluded from the limitation. Based upon the Committee’s commitment to link compensation with performance as described in this report, the Committee currently intends to qualify compensation paid to the Company’s executive officers for deductibility by the Company under Section 162(m).
COMPENSATION AND HUMAN RESOURCE DEVELOPMENT COMMITTEEWilliam J. Meurer, Chairman
Ernest J. MilaniIain A. Macdonald
Mark C. Bozek
Dr. Linda F. McClintock-Greco
April 4, 2005Paul L. Whiting
 
March 26, 2008
The information contained in this report shall not be deemed to be “soliciting material” or “filed” or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934.

36

STOCK PRICE PERFORMANCE GRAPHSECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
 The following graph presents a comparison
During the year ended December 31, 2007, the executive officers and directors of the cumulative total shareholder returnCompany filed with the Securities and Exchange Commission (the “Commission”) on a timely basis, all required reports relating to transactions involving equity securities of the Company beneficially owned by them. The Company has relied solely on the common stockwritten representation of its executive officers and directors and copies of the reports they have filed with the cumulative total return on the Nasdaq Stock Market (U.S.) Index, the Nasdaq Computer and Data Processing Services Index, the Nasdaq Telecommunications Index, the Russell 2000 Index and the Sykes Peer Group (as defined below**). The Company intends to remove the Nasdaq Stock Market (U.S.) Index from it’s comparison next year due to the fact that it contains small, medium and large capitalization (“cap”) stocks which compromises its use as a comparison to the Company’s stock, which is a small cap stock. The Company is addingCommission in providing this year the Russell 2000 Index, of which the Company is a member. The Russell 2000 Index measures the performance of the 2,000 smallest cap companies in the Russell 3000 Index. The Company is also adding a Peer Group comprised of publicly traded companies that derive a substantial portion of their revenues from the call center, customer care business, have similar business models to the Company, and are those most commonly compared to the Company by industry analysts following the Company. This graph assumes that $100 was invested on December 31, 1999 in the Company’s common stock, the Nasdaq Stock Market (U.S.) Index, the Nasdaq Computer and Data Processing Services Index, the Nasdaq Telecommunications Index, the Russell 2000 Index and Sykes Peer Group.information.
COMPARISON OF 60 MONTH CUMULATIVE TOTAL RETURN*
AMONG SYKES ENTERPRISES, INCORPORATED,
THE NASDAQ STOCK MARKET (U.S.) INDEX,
THE NASDAQ COMPUTER & DATA PROCESSING SERVICES INDEX,
THE NASDAQ TELECOMMUNICATIONS INDEX,
THE RUSSELL 2000 INDEX,
AND THE SYKES PEER GROUP
LOGO
                         
 
  1999 2000 2001 2002 2003 2004
 
Sykes  100   10.11   21.29   7.48   19.58   15.84 
Nasdaq Stock Market (U.S.) Index  100   60.71   47.93   32.82   49.23   53.46 
Nasdaq Computer & Data Processing Services Index  100   55.69   42.16   26.77   40.20   41.51 
Nasdaq Telecommunications Index  100   45.64   23.30   10.71   18.08   19.52 
Russell 2000® Index  100   95.68   96.66   75.80   110.19   128.92 
Sykes Peer Group  100   78.53   75.74   51.13   68.76   64.11 

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* $100 invested on December 31, 1999 in stock or index including reinvestment of dividends. Fiscal year ending December 31.
**SYKES PEER GROUP
APAC CustomerTeleTechConvergys
 NameService, Inc.Sitel Corp.Holdings, Inc.West Corp.Startek, Inc.ICT Group, Inc.Corp.
Ticker Symbol
APACSWWTTECWSTCSRTICTGCVG
      There can be no assurance that the Company’s stock performance will continue into the future with the same or similar trends depicted in the graph above. The Company does not make or endorse any predictions as to the future stock performance.
The information contained in the Stock Performance Graph section shall not be deemed to be “soliciting material” or “filed” or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934.
DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS
 
The deadline for submission of shareholder proposals pursuant toRule 14a-8 under the Securities Exchange Act of 1934, as amended, (“Rule 14a-8”), for inclusion in the Company’s proxy statement for its 20062009 Annual Meeting of Shareholders is December 21, 2005.2008. Pursuant to the Company’s Bylaws, only shareholder proposals submitted on or prior to such date may be brought before the meeting.
OTHER MATTERS
 
Management knows of no matter to be brought before the Annual Meeting which is not referred to in the Notice of Annual Meeting. If any other matters properly come before the Annual Meeting, it is intended that the shares represented by Proxy will be voted with respect thereto in accordance with the judgment of the persons voting them.
By Order of the Board of Directors,
-s- JAMES T. HOLDER
James T. Holder
Secretary
By Order of the Board of Directors,
-s- JAMES T. HOLDER
James T. Holder
Secretary


44

38

APPENDIX A
SYKES ENTERPRISES, INCORPORATED
2004 NONEMPLOYEE DIRECTOR FEE PLAN
ARTICLE I. DEFINITIONS
      1.1     Definitions. Whenever the following terms are used in this Plan they shall have the meanings specified below unless the context clearly indicates to the contrary:
(PROXY CARD)
. NNNNNNNNNNNN
NNNNNNNNNNNNNNN C123456789
      (a) “Board”:000004 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext
MR A SAMPLE DESIGNATION (IF ANY) 000000000.000000 ext 000000000.000000 ext
ADD 1Electronic Voting Instructions ADD 2 ADD 3You can vote by Internet or telephone!ADD 4Available 24 hours a day, 7 days a week! ADD 5 Instead of mailing your proxy, you may choose one of the two voting ADD 6 methods outlined below to vote your proxy. NNNNNNNNN VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.Proxies submitted by the Internet or telephone must be received by 1:00 a.m., Eastern Time, on May 21, 2008. Vote by Internet · Log on to the Internet and go towww.investorvote.com/SYKE
· Follow the steps outlined on the secured website.
Vote by telephone
· Call toll free 1-800-652-VOTE (8683) within the United States, Canada & Puerto Rico any time on a touch tone telephone. There isNO CHARGEto you for the call.
Using ablack inkpen, mark your votes with anXas shown in X• Follow the instructions provided by the recorded message. this example. Please do not write outside the designated areas.
Annual Meeting Proxy Card 123456 C0123456789 12345
3IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.3
A Proposals — The Board of Directors ofrecommends a vote FOR all the Company.
      (b) “Common Stock”: The Company’s Common Stock, par value $.01 per share.
      (c) “Common Stock Unit”: A bookkeeping entry that records the equivalent of one Share.
      (d) “Company”: Sykes Enterprises, Incorporated or any successor or successors thereto.
      (e) “Nonemployee Director”: An individual duly elected or chosen as a Director of the Company who is not also an employee of the Company or its subsidiaries.
      (f) “Plan”: The Plan set forth in this instrument as it may, from time to time, be amended.
      (g) “Share”: A fully paid, non-assessable share of Common Stock.nominees listed and FOR Proposal 2.
ARTICLE II. PURPOSE
      The purpose of this Plan is to secure for the Company and its shareholders the benefits of the incentive inherent in increased ownership of Common Stock of the Company by members of the Board of Directors of the Company who are not employees of the Company or any of its Subsidiaries, by providing for the payment of a portion of each Nonemployee Director’s compensation in Common Stock. It is expected that such ownership will further align the interests of such Nonemployee Directors with the shareholders of the Company, thereby promoting the long-term profits and growth of the Company, and will encourage such Nonemployee Directors to remain directors of the Company and provide them with the benefits of deferring the receipt of some of such compensation. It is also expected that the Plan will encourage qualified persons to become directors of the Company.
ARTICLE III. INITIAL GRANT OF COMMON STOCK UNITS
      In consideration of joining the Board, upon the initial election of a Nonemployee Director to the Board, such Nonemployee Director shall receive an award of Common Stock Units. The number of Common Stock Units shall be determined by dividing a dollar amount to be determined from time to time by the Board (initially set at $30,000) by an amount equal to 110% of the average closing prices of the Company’s common stock for the five trading days prior to the date the Nonemployee Director is elected, rounded to the nearest whole number of Common Stock Units. The initial grant of Common Stock Units will vest in three equal installments, one-third on the date of each of the following three annual shareholders’ meetings.

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ARTICLE IV. ANNUAL RETAINER FEE
      In consideration of their services as members of the Board, each Nonemployee Director shall be entitled to receive an annual retainer fee in such amount as shall be determined from time to time by the Board (initially set at $50,000). The annual retainer fee shall be payable in advance on the day after the annual shareholders’ meeting in such year and shall be paid 25% in cash and 75% in Common Stock Units. The number of Common Stock Units shall be determined by dividing 75% of the amount of the annual retainer fee by an amount equal to 105% of the average of the closing prices for the Company’s common stock on the five trading days preceding the award date (the day after the annual meeting), rounded to the nearest whole number of Common Stock Units. The annual grant of Common Stock Units will vest in two equal installments, one-half on the date of each of the following two annual shareholders’ meetings. The provision in this Article IV for the payment of an annual retainer fee to Nonemployee Directors shall not limit the ability of the Board to provide for additional compensation payable to Nonemployee Directors for services on behalf of the Board over and above those typically expected of Directors, including serving as Chair of a Board committee.
ARTICLE V. ACCELERATION OF VESTING OF COMMON STOCK UNITS
      Notwithstanding any provision hereof to the contrary, all Common Stock Units shall automatically vest upon the termination of a Director’s service as a Director, whether by reason of death, retirement, resignation, removal or failure to be reelected at the end of his or her term.
ARTICLE VI. ISSUANCE OF SHARES OF COMMON STOCK
FOR COMMON STOCK UNITS
      Upon the vesting of Common Stock Units, the Nonemployee Director shall be entitled to receive for each vested Common Stock Unit one Share, and the vested Common Stock Units shall be canceled. The Company shall cause a certificate representing such Shares to be issued to the Nonemployee Director promptly following the vesting of the Common Stock Units.
ARTICLE VII. ADMINISTRATION, AMENDMENT AND TERMINATION
      7.1     Administration. The Plan shall be administered by the Board. The Board shall have such powers as may be necessary to discharge its duties hereunder. The Board may, from time to time, employ agents and delegate to them such administrative duties as it sees fit, and may from time to time consult with legal counsel who may be counsel to the Company. All decisions and determinations by the Board shall be final and binding on all parties.
      7.2     Amendment and Termination. The Board may alter or amend this Plan from time to time or may terminate it in its entirety; provided, however, that no such action shall, without the consent of a Nonemployee Director, affect the rights in any Common Stock Units issued to such Nonemployee Director; and further provided, that, any amendment which must be approved by the shareholders of the Company in order to comply with applicable law or the rules of any national securities exchange or securities listing service upon which the Shares are traded or quoted shall not be effective unless and until such approval is obtained. Presentation of the Plan or any amendment thereof for shareholder approval shall not be construed to limit the Company’s authority to offer similar or dissimilar benefits in plans that do not require shareholder approval.

A-2

      7.3     Adjustments. In the event of any change in the outstanding Common Stock by reason of (a) any stock dividend, stock split, combination of shares, recapitalization or any other change in the capital structure of the Company, (b) any merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing, the number or kind of Shares that may be issued under the Plan and the number of Common Stock Units credited to a Nonemployee Director automatically shall be adjusted so that the proportionate interest of the Nonemployee Directors shall be maintained as before the occurrence of such event. Such adjustment shall be conclusive and binding for all purposes with respect to the Plan.
      7.4     Successors. The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation, reorganization or otherwise) to all or substantially all of the business and/or assets of the Company expressly to assume and to agree to perform this Plan in the same manner and to the same extent the Company would be required to perform if no such succession had taken place. This Plan shall be binding upon and inure to the benefit of the Company and any successor of or to the Company, including without limitation any persons acquiring directly or indirectly all or substantially all of the business and/or assets of the Company whether by sale, merger, consolidation, reorganization or otherwise (and such successor shall thereafter be deemed the “Company” for the purpose of this Plan), and the heirs, beneficiaries, executors and administrators of each Nonemployee Director.
ARTICLE VIII. SHARES SUBJECT TO PLAN
      Subject to adjustment as provided in this Plan, the total number of Shares of Common Stock which may be issued under this Plan shall be Four Hundred Fifty Thousand (450,000). Shares may be shares of original issuance or treasury shares or a combination of the foregoing.
ARTICLE IX. EFFECTIVE DATE; APPROVAL BY SHAREHOLDERS
      The Plan shall be effective as of May 6, 2004, and shall be submitted for approval by the shareholders of the Company at the 2005 annual shareholders’ meeting. If such approval is not obtained at such meeting, this Plan shall be nullified and all Common Stock Units issued prior to such annual meeting shall be canceled automatically.
ARTICLE X. GENERAL PROVISIONS
      10.1     No Continuing Right to Serve as a Director. Neither the adoption or of this Plan, nor any document describing or referring to this Plan, or any part thereof, shall confer upon any Nonemployee Director any right to continue as a director of the Company or any subsidiary of the Company.
      10.2     Rights as a Shareholder. Until the vesting of a Common Stock Unit, a Nonemployee Director shall have none of the rights of a shareholder with respect to his or her Common Stock Units. Upon the vesting of a Common Stock Unit, the Nonemployee Director shall have the right to receive a Share for such Common Stock Unit, shall be deemed to be the owner of such Share which shall be deemed to be issued and outstanding, and shall have all of the rights of a shareholder with respect to such Share.
      10.3     Governing Law. The provisions of this Plan shall be governed by construed in accordance with the laws of the State of Florida.

A-3

      10.4     Withholding Taxes. To the extent that the Company is required to withhold Federal, state or local taxes in connection with any component of a Nonemployee Director’s compensation in cash or Shares, and the amounts available to Company for such withholding are insufficient, it shall be a condition the receipt of any Shares that the Nonemployee Director make arrangements satisfactory to the Company for the payment of the balance of such taxes required to be withheld, which arrangement may include relinquishment of the Shares. The Company and a Nonemployee Director may also make similar arrangements with respect to payment of any other taxes derived from or related to the payment of Shares with respect to which withholding is not required.
      10.5     Miscellaneous. Headings are given to the sections of this Plan as a convenience to facilitate reference. Such headings, numbering and paragraphing shall not in any case be deemed in any way material or relevant to the construction of this Plan or any provisions thereof. The use of the singular shall also include within its meaning the plural, and vice versa.

A-4

SYKES ENTERPRISES, INCORPORATED
Annual Meeting of Shareholders, May 24, 2005
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
     The undersigned shareholder of Sykes Enterprises, Incorporated (the “Company”) hereby appoints Charles E. Sykes, W. Michael Kipphut and James T. Holder as Proxies, each with the power to appoint a substitute, and hereby authorizes them to vote all such shares of the Company as to which the undersigned is entitled to vote at the Annual Meeting of Shareholders of the Company and at all adjournments thereof, to be held at the Tampa Marriott Waterside, 700 South Florida Avenue, Tampa, Florida, on Tuesday, May 24, 2005, at 9:00 a.m., Eastern Daylight Savings Time, in accordance with the following instructions:
THE SHARES REPRESENTED HEREBY WILL BE VOTED AS SPECIFIED. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES LISTED IN ITEM 1.
1.TO ELECT FIVE DIRECTORS. To elect four Directors:
(to serve for a term of three years)


(to serve for a term of one year) +For Withhold            For Withhold            For Withhold
1.01 — H. Parks Helms
3. 02 — Linda McClintock-Greco, M.D.

5. Charles E. Sykes		2. 03 — James S. MacLeod
4.
04 — James K. (Jack) Murray, Jr.
For Against Abstain
oFORall nominees listed to2. To ratify the left (exceptappointment of Deloitte & Touche LLP as specified below)oWITHHOLD AUTHORITYto vote for all nominees listed to the left.
(Instructions: To withhold authority to vote for any indicated
nominee, write the number(s) of the nominee(s) in the box
provided to the right.)

2.To approve the 2004 Non-Employee Director Fee Plan.      oFORoAGAINSToABSTAIN
3.To approve the acceleration of the vesting of stock options held by certain Non-Employee Directors.

oFORoAGAINSToABSTAIN
4.In their discretion, the proxies are authorized to vote upon such other independent auditors of the Company. business as may properly come before this meeting or any adjournments or postponements thereof.
B Non-Voting Items
Check appropriateChange of Address— Please print new address below.Meeting Attendance
Mark box to indicate any changesthe right if you plan to name or address below:

Address Change? o      Name Change? oattend the Annual Meeting.
C Authorized Signatures — This section must be completed for your vote to be counted. — Date
NO. OF SHARES 
and Sign Below
------------------------------------------------------
Signature(s) in Box
Please sign Proxy exactly as your name appears in this Proxy. When shares are held by joint tenants, both should sign.on your stock certificate(s). JOINT OWNERS SHOULD EACH SIGN PERSONALLY. When signing as attorney, executor, administrator, trustee, guardian, partner or partner,corporate officer, please give your full title as such. If
Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box.
C 1234567890 J N T MR A SAMPLE (THIS AREA IS SET UP TO ACCOMMODATE
140 CHARACTERS) MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND
NNNNNNN1 U P X 0 1 7 8 8 6 1 MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND +
<STOCK#> 00W69A

(PROXY CARD)
3IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.3
Proxy — SYKES ENTERPRISES, INCORPORATED Annual Meeting of Shareholders, May 21, 2008
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned shareholder of Sykes Enterprises, Incorporated (the “Company”) hereby appoints each of Charles E. Sykes, W. Michael Kipphut and James T. Holder, and each of them with authority to act without the others, as attorneys and proxies for the undersigned, with full power of substitution, to vote all shares of the common stock of the Company which the undersigned is entitled to vote at the Annual Meeting of Shareholders of the Company and at all adjournments thereof, to be held at the Tampa Marriott Waterside, 700 South Florida Avenue, Tampa, Florida, on Wednesday, May 21, 2008, at 9:00 a.m., Eastern Daylight Savings Time, with all the powers the undersigned would possess if personally present, such proxies being directed to vote as specified below and in their discretion on any other business that may properly come before the Meeting.
The undersigned reserves the right to revoke this Proxy at any time prior to the Proxy being voted at the Meeting. The Proxy may be revoked by delivering a corporation, please signsigned revocation to the Company at any time prior to the Meeting, by submitting a later-dated Proxy, or by attending the Meeting in person and casting a ballot. The undersigned hereby revokes any proxy previously given to vote such shares at the corporate name by President or other authorized officer. If a partnership, please sign in partnership name by authorized partner.Meeting.
THE SHARES REPRESENTED HEREBY WILL BE VOTED AS SPECIFIED ON THE REVERSE SIDE. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES LISTED IN ITEM 1, AND FOR PROPOSAL 2.
PLEASE SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY IN THE ENCLOSED ENVELOPE EVEN IF YOU PLAN TO ATTEND THE MEETING.