10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2005

or

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 1-12793

StarTek, Inc.

(Exact name of registrant as specified in its charter)

Delaware	84-1370538
(State or other jurisdiction of	(I.R.S. employer
incorporation or organization)	Identification No.)
100 Garfield Street	80206
Denver, Colorado	(Zip code)
(Address of principal executive offices)

(303) 399-2400
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange on Which Registered
Common Stock, $.01 par value	New York Stock Exchange, Inc.

Securities registered pursuant to Section 12(g) of the Act:
None

          Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

          Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes þ No o

          Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2). Yes o No þ

          Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $0.01 Par Value – 14,631,091 shares as of November 1, 2005.

STARTEK, INC.

FORM 10-Q

INDEX

PART I FINANCIAL INFORMATION	3
Item 1. Financial Statements (unaudited)	3
Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2005, and 2004.	3
Condensed Consolidated Balance Sheets as of September 30, 2005, and December 31, 2004.	4
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2005, and 2004.	5
Notes to Condensed Consolidated Financial Statements	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3. Quantitative and Qualitative Disclosure About Market Risk	18
Item 4. Controls and Procedures	19
PART II. OTHER INFORMATION	19
Item 1. Legal Proceedings	19
Item 4. Submission of Matters to a Vote of Security Holders	21
Item 6. Exhibits	21
SIGNATURES	22
Confidential Severance Agreement
Master Services Agreement
Certification of Steven D. Butler Pursuant to Section 302
Certification of Rodd E. Granger Pursuant to Section 302
Certification of CEO and CFO Pursuant to Section 906

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Part I. FINANCIAL INFORMATION

          Item 1. Financial Statements (Unaudited)

STARTEK, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(Dollars in thousands, except per share data)

(Unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Revenue	$	53,877		$	54,448		$	158,206		$	163,861
Cost of services		41,353			42,232			121,645			118,961
Gross profit		12,524			12,216			36,561			44,900
Selling, general and administrative expenses		7,190			7,357			21,402			20,920
Operating profit		5,334			4,859			15,159			23,980
Net interest and other income		1,060			793			1,098			2,566
Income from continuing operations before income taxes		6,394			5,652			16,257			26,546
Income tax expense		2,743			1,981			6,584			9,942
Income from continuing operations		3,651			3,671			9,673			16,604
Discontinued operations:
Loss from operations of discontinued operations		(820	)		1,494			(1,942	)		2,208
Loss on disposal of discontinued operations		—			(2,316	)		—			(2,316	)
Income tax benefit		343			379			732			65
Loss on discontinued operations		(477	)		(443	)		(1,210	)		(43	)
Net income	$	3,174		$	3,228		$	8,463		$	16,561
Net income per share from continuing operations:
Basic	$	0.25		$	0.25		$	0.66		$	1.15
Diluted	$	0.25		$	0.25		$	0.66		$	1.12
Net income per share including discontinued operations:
Basic	$	0.22		$	0.22		$	0.58		$	1.15
Diluted	$	0.22		$	0.22		$	0.58		$	1.12
Dividends declared per common share	$	0.36		$	0.41		$	1.08		$	1.20

See notes to condensed consolidated financial statements.

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STARTEK, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Dollars in thousands)

	September 30,		December 31,
	2005		2004
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	13,985	$	14,609
Investments		35,841		24,785
Trade accounts receivable, less allowance for doubtful accounts of $218 and $357, respectively		38,274		49,254
Income tax receivable		4,030		12,344
Assets held for sale		5,473		6,638
Deferred tax asset		1,452		2,875
Prepaid expenses and other current assets		2,667		2,038
Total current assets		101,722		112,543
Property, plant and equipment, net		53,022		55,731
Long-term deferred tax assets		3,485		1,521
Other assets		209		224
Total assets	$	158,438	$	170,019
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	4,350	$	7,190
Accrued liabilities:
Accrued payroll		4,779		5,950
Accrued compensated absences		4,034		4,368
Accrued health insurance		750		188
Other accrued liabilities		564		333
Current portion of long-term debt		2,528		2,580
Short-term borrowings		—		1,250
Income tax payable		4,301		1,626
Other current liabilities		926		434
Total current liabilities		22,232		23,919
Long-term debt, less current portion		3,766		5,533
Long-term income tax payable		1,645		1,962
Other liabilities		1,180		1,722
Total liabilities		28,823		33,136
Stockholders’ equity:
Common stock		146		146
Additional paid-in capital		60,153		59,736
Accumulated other comprehensive income		2,344		1,815
Retained earnings		66,972		75,186
Total stockholders’ equity		129,615		136,883
Total liabilities and stockholders’ equity	$	158,438	$	170,019

See notes to condensed consolidated financial statements.

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STARTEK, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Dollars in thousands)

(Unaudited)

	Nine Months Ended
	September 30,
	2005			2004
Operating Activities
Net income	$	8,463		$	16,561
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation		9,744			9,452
Deferred income taxes		(943	)		1,344
Realized loss (gain) on investments		711			(1,659	)
Loss (gain) on sale of assets		(857	)		1,837
Changes in operating assets and liabilities:
Sales of trading securities, net		2,940			1,126
Trade accounts receivable, net		12,371			768
Inventories, net		153			(785	)
Prepaid expenses and other assets		263			(1,710	)
Accounts payable		(3,114	)		2,425
Income taxes receivable, net		10,794			(10,824	)
Accrued and other liabilities		(486	)		3,318
Net cash provided by operating activities		40,039			21,853
Investing Activities
Purchases of investments available for sale		(633,045	)		(131,011	)
Proceeds from disposition of investments available for sale		617,405			134,277
Purchases of property, plant and equipment		(7,315	)		(13,038	)
Proceeds from disposition of property, plant and equipment		1,292			—
Net cash used in investing activities		(21,663	)		(9,772	)
Financing Activities
Proceeds from stock option exercises		295			2,745
Principal payments on borrowings		(3,950	)		(1,369	)
Dividend payments		(16,676	)		(16,869	)
Proceeds from borrowings		880			10,000
Net cash used in financing activities		(19,451	)		(5,493	)
Effect of exchange rate changes on cash		451			(270	)
Net (decrease) increase in cash and cash equivalents		(624	)		6,318
Cash and cash equivalents at beginning of period		14,609			5,955
Cash and cash equivalents at end of period	$	13,985		$	12,273
Supplemental Disclosure of Cash Flow Information
Cash paid for interest	$	198		$	226
Income taxes paid	$	3,510		$	19,393
Property, plant and equipment financed under long-term debt		—		$	10,000
Change in unrealized gain on investments available for sale, net of tax	$	(575	)	$	(1,466	)

See notes to condensed consolidated financial statements.

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STARTEK, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)

1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In management’s opinion, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results during the three and nine months ended September 30, 2005, are not necessarily indicative of operating results that may be expected during any other interim period of 2005 or the year ended December 31, 2005.

The consolidated balance sheet as of December 31, 2004, was derived from audited financial statements at that date, but does not include all information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the StarTek, Inc. annual report on Form 10-K for the year ended December 31, 2004.

Certain reclassifications have been made to 2004 information to confirm to 2005 presentation.

Unless otherwise noted in this report, any description of “us” refers to StarTek, Inc. and our subsidiaries. Unless otherwise indicated, currency translations into U.S. dollars are calculated using prevailing foreign currency exchange rates as of September 30, 2005.

Stock Option Plans

We currently account for stock-based awards to employees and non-employee directors under the intrinsic value recognition and measurement principles of Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and related Interpretations (APB 25). Non-employee directors are treated as employees for purposes of determining stock-based compensation expense. Typically, the exercise price of all options granted to employees and non-employee directors under our stock option plans is equal to the market price of the underlying stock on the grant date, therefore no stock-based employee compensation cost is recognized in net income. However, during the second quarter of 2005, we made a modification to a previously existing option agreement which, under APB 25, required us to recognize an immaterial amount of compensation cost in net income in that period. The following table illustrates the effect on net income and earnings per share if we had applied the fair value recognition provisions of Financial Accounting Standards Board (“FASB”) Statement of Financial Accounting Standards (“SFAS”) No. 123, “Accounting for Stock-Based Compensation,” to all awards.

For purposes of this pro forma disclosure, the estimated fair value of the options is assumed to be amortized to expense over the options’ vesting periods.

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	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Net income, as reported	$	3,174		$	3,228		$	8,463		$	16,561
Stock-based employee (including non-employee directors) compensation expense that would have been included in the determination of net income if the fair value method had been applied to all awards, net of tax		(828	)		(521	)		(1,242	)		(1,658	)
Pro forma net income	$	2,346		$	2,707		$	7,221		$	14,903
Basic earnings per share
As reported	$	0.22		$	0.22		$	0.58		$	1.15
Pro forma	$	0.16		$	0.19		$	0.49		$	1.03
Diluted earnings per share
As reported	$	0.22		$	0.22		$	0.58		$	1.12
Pro forma	$	0.16		$	0.18		$	0.49		$	1.01

New Accounting Pronouncements

In December 2004, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 123 (revised 2004), “Share-Based Payment” (SFAS No. 123R), which is a revision of SFAS No. 123, “Accounting for Stock-Based Compensation.” SFAS No. 123R supersedes Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees, “ (APB 25) and amends SFAS No. 95, “Statement of Cash Flows.” Generally, the approach in SFAS No. 123R is similar to the approach described in SFAS No. 123. However, SFAS No. 123R requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values over the period during which the employees are required to provide services in exchange for the equity instruments. Pro forma disclosure is no longer an alternative. Under the provisions of this statement, we must determine the appropriate fair value model to be used for valuing share-based payments, the amortization method of compensation cost and the transition method to be used at the date of adoption. The transition alternatives include retrospective and prospective adoption methods. Under the retrospective method, prior periods may be restated based on the amounts previously recognized under SFAS No. 123 for the purposes of pro forma disclosures (see above) either for all periods presented or as of the beginning of the year of adoption. The prospective method requires that compensation expense be recognized beginning with the effective date for all share-based payments granted after the effective date, and for all awards granted to employees prior to the effective date of this statement that remain unvested on the effective date. The provisions of this statement are effective as of the beginning of the first annual reporting period that begins after June 15, 2005. We are currently evaluating the requirements of this revision and have not yet determined the impact of its adoption.

In March 2005, the FASB issued FASB Interpretation No. 47, “Accounting for Conditional Asset Retirement Obligations” (FIN 47). FIN 47 clarifies that a conditional asset retirement obligation, as used in SFAS 143, “Accounting for Asset Retirement Obligations,” refers to a legal obligation to perform an asset retirement activity in which the timing and/or method of the settlement are conditional on a future event that may or may not be within the control of the entity. Accordingly, an entity is required to recognize a liability for the fair value of a conditional asset retirement obligation if the fair value can be reasonably estimated. FIN 47 is effective January 1, 2006, and early adoption is allowed. We have not yet determined the impact, if any, FIN 47 will have on our Condensed Consolidated Financial Statements.

2. Net Income Per Share

Basic and diluted net income per common share is computed on the basis of our weighted average number of common shares outstanding, as determined by using the calculations outlined below:

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	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
				(in thousands, except per share amounts)
Net income available to common shareholders from continuing operations	$	3,651		$	3,671		$	9,673		$	16,604
Loss from discontinued operations		(477	)		(443	)		(1,210	)		(43	)
Net income	$	3,174		$	3,228		$	8,463		$	16,561
Weighted average shares of common stock		14,631			14,470			14,628			14,423
Dilutive effect of stock options		42			275			48			366
Common stock and common stock equivalents		14,673			14,745			14,676			14,789
Basic net income (loss) per share:
Continuing operations	$	0.25		$	0.25		$	0.66		$	1.15
Discontinued operations		(0.03	)		(0.03	)		(0.08	)		—
Net income per basic share	$	0.22		$	0.22		$	0.58		$	1.15
Diluted net income (loss) per share:
Continuing operations	$	0.25		$	0.25		$	0.66		$	1.12
Discontinued operations		(0.03	)		(0.03	)		(0.08	)		—
Net income per diluted share	$	0.22		$	0.22		$	0.58		$	1.12

Diluted earnings per share is computed on the basis of our weighted average number of common shares outstanding plus the effect of dilutive outstanding stock options using the treasury stock method. Anti-dilutive securities totaling approximately 727,280 and 180,710 in the three months ended September 30, 2005, and 2004, respectively, and 555,138 and 102,146 for the nine months ended September 30, 2005, and 2004, respectively, were not included in our calculation because the stock options’ exercise prices were greater than the average market price of the common shares during the periods presented.

3. Investments

As of September 30, 2005, investments available for sale consisted of:

			Gross		Gross			Estimated
	Basis		Unrealized Gains		Unrealized Losses			Fair Value
Corporate debt securities	$	33,966	$	20	$	(2	)	$	33,984
Equity securities		1,916		12		(60	)	$	1,868
Total	$	35,882	$	32	$	(62	)	$	35,852

As of December 31, 2004, investments available for sale consisted of:

			Gross		Gross			Estimated
	Basis		Unrealized Gains		Unrealized Losses			Fair Value
Corporate debt securities	$	16,791	$	626	$	(123	)	$	17,294
Equity securities		4,175		397		(10	)		4,562
Total	$	20,966	$	1,023	$	(133	)	$	21,856

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As of September 30, 2005, amortized costs and estimated fair values of investments available for sale by contractual maturity were:

			Estimated
	Basis		Fair Value
Corporate debt securities maturing within:
One year or less	$	33,966	$	33,984
Two to five years		—		—
More than five years		—		—
	$	33,966	$	33,984
Equity securities		1,916		1,868
Total	$	35,882	$	35,852

As of September 30, 2005, equity securities primarily consisted of publicly traded common stock of domestic companies and mutual funds. Corporate debt securities at September 30, 2005, consisted primarily of corporate bonds, commercial paper and variable preferred debt securities. We had no investments at September 30, 2005, or December 31, 2004, that had carried unrealized losses for longer than twelve months.

As of September 30, 2005, we were invested in trading securities, consisting of option contracts, which were an immaterial portion of our total portfolio. As of December 31, 2004, we were invested in trading securities, consisting of alternative investment partnerships and option contracts, which, in the aggregate, had an original cost and fair market value of $2,054 and $2,929, respectively. These trading securities are held to meet short-term investment objectives.

From time to time, we purchase or write option contracts to partially hedge against fluctuations in the value of our investment portfolio. All such options are publicly-traded with standard market terms. These options are trading securities and are recorded at fair value with changes in fair value recognized in current period earnings. We do not designate these options as hedging instruments pursuant to SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities. Options have been an immaterial part of our overall investment portfolio and we expect them to be an immaterial part of our overall risk management approach in the future.

A substantial decline and/or change in value of equity securities, equity prices in general, international equity mutual funds, investment limited partnerships, and/or call and put options, if held in our investment portfolio, could have a material adverse effect on our portfolio of securities. Also, trading securities could be materially and adversely affected by increasing interest and/or inflation rates or market expectations thereon, poor management, shrinking product demand, and other risks that may affect single companies, as well as groups of companies. Our risk of loss in the event of nonperformance by any party is not considered substantial.

4. Principal Clients

The following table represents the concentration of revenue from continuing operations for our principal clients:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Cingular Wireless, LLC (formerly AT&T Wireless Services, Inc.)		51.7	%		50.8	%		54.3	%		50.3	%
T-Mobile, a subsidiary of Deutsche Telekom		25.9	%		26.4	%		23.6	%		30.2	%
AT&T Corp.		10.9	%		11.0	%		11.4	%		11.8	%

Our agreement with Cingular Wireless, LLC has been extended to December 2006. The term of our T-Mobile contract was extended to September 2006 at which time, unless we are notified otherwise by T-Mobile, the term will renew until August 2007. There are no volume or revenue guarantees associated with either of these contracts.

The results of operations of our supply chain management services platform were classified as discontinued operations during the quarter. Consequently, total revenue from continuing operations used to calculate these percentages has been adjusted accordingly and may differ from amounts previously disclosed in our filings with the Securities and Exchange Commission as well as other

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financial disclosures. Please refer to Note 6, Discontinued Operations, for discussion of management’s intent to sell the supply chain management platform.

The loss of a principal client and/or changes in timing or termination of a principal client’s product launch, volume delivery or service offering would have a material adverse effect on our business, revenue, operating results, and financial condition. To limit our credit risk, management from time to time will perform credit evaluations of our clients. Although we are directly impacted by the economic conditions in which our clients operate, management does not believe substantial credit risk existed as of September 30, 2005.

5. Comprehensive Income

SFAS No. 130, “Reporting Comprehensive Income”, establishes standards for reporting and display of comprehensive income. Comprehensive income is defined essentially as all changes in stockholders’ equity, exclusive of transactions with owners. The following represents the components of other comprehensive income:

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2005		2004			2005			2004
Net income	$	3,174	$	3,228		$	8,463		$	16,561
Other comprehensive income (loss):
Foreign currency translation adjustments, net of tax		473		616			361			305
Change in fair value of derivative instruments		743		—			743			—
Unrealized gain (loss) on available for sale securities, net of tax		46		(889	)		(575	)		(1,466	)
Comprehensive income	$	4,436	$	2,955		$	8,992		$	15,400

We enter into foreign exchange contracts to hedge our anticipated operating commitments that are denominated in foreign currencies. The contracts cover periods commensurate with expected exposure, generally within six months, and are principally unsecured foreign exchange contracts. The market risk exposure is essentially limited to risk related to currency rate movements. During the three and nine months ended September 30, 2005, these hedging commitments resulted in unrealized gains of $743, which have been recorded in other comprehensive income. These hedging commitments also resulted in $318 of realized gains which were recognized in our consolidated statements of income during the three and nine months ended September 30, 2005.

6. Discontinued Operations

As of September 30, 2005, we had committed to selling our supply chain management services platform. We have entered into a signed letter of intent with a third party under which we intend to sell all of the inventory, prepaid assets, accounts receivable, accounts payable, and property, plant and equipment of the supply chain management services platform. The deal is currently in negotiation and is expected to be settled within the next year, with payment from a third party buyer currently anticipated to be structured as a combination of cash and a long-term note. We have classified the affected assets of $5,473 and $6,638 as held for sale in our condensed consolidated balance sheets as of September 30, 2005, and December 31, 2004, respectively, in addition to an immaterial amount of other current liabilities related to the sale. We have also presented the results of operations of the supply chain management services platform as discontinued operations in our condensed consolidated statements of income. Results of operations from the supply chain management services platform resulted in a loss, net of tax, of $477 and $1,210 during the three-and nine-month periods ending September 30, 2005, respectively. Results of operations from supply chain management services platform resulted in income, net of tax, of $1,289 and $2,522 during the three-and nine-month periods ending September 30, 2004, respectively.

On September 30, 2004, we sold StarTek Europe, Ltd. (“StarTek Europe”), our operating subsidiary in the United Kingdom (“U.K.”) which provided business process management services from two facilities in Hartlepool, England. The sale was completed pursuant to a Share Purchase Agreement among us, StarTek Europe and Taelus Limited, a U.K. company. Pursuant to the terms of the Share Purchase Agreement, we made a capital contribution to StarTek Europe immediately prior to completion of the transaction, in the form of a cash payment of $450, a contribution of intercompany debt of $2,824 owed to us by StarTek Europe and additional cash of $200 contributed to fund operations, which offset a negative investment in StarTek Europe of $1,608. Following these transactions, we conveyed all of the issued and outstanding capital stock of StarTek Europe to Taelus Limited, together with another cash payment of $450. During the three- and nine-month periods ending September 30, 2004, we reported losses, net of tax, of $1,732 and $2,565, respectively, in our consolidated statements of income.

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7. Debt

On June 29, 2005, we amended and renewed our Revolving Line of Credit agreement with Wells Fargo Bank, NA (the Bank). The amendment extends the last day under which the Bank will make advances under the Line of Credit to June 30, 2007. Covenants pertaining to this debt agreement also changed as a result of the amendment, such that:

• we must have had a tangible net worth of $90,000 at December 31, 2004,

• we must generate net profit after tax of one dollar on a rolling four quarter basis, measured quarterly, and are not permitted to incur net losses in any two consecutive quarterly periods. At the close of each subsequent quarter, we will be required to have a minimum tangible net worth equal to the minimum tangible net worth we were required to have at the end of the prior fiscal period plus 25% of net income (if positive).

• the outstanding principal balance of the Note bears interest at either a fluctuating rate per annum that is 1% below the Prime Rate or at a fixed rate per annum determined by the Bank to be 1.5% above LIBOR, and

• interest is payable on a monthly basis.

Our maximum borrowings under this agreement must not exceed $10,000. As of September 30, 2005, we had no borrowings outstanding under this line of credit and were in compliance with our debt covenants.

8. Litigation

We and six of our present and former directors and officers have been named as defendants in West Palm Beach Firefighters’ Pension Fund v. StarTek, Inc., et al. (U.S. District Court, District of Colorado) filed on July 8, 2005, and John Alden v. StarTek, Inc., et al. (U.S. District Court, District of Colorado) filed on July 20, 2005. Each action is a purported class action brought on behalf of all persons (except defendants) who purchased shares of our common stock in a secondary offering by certain of our stockholders in June 2004, and in the open market between February 26, 2003, and May 5, 2005 (the “Class Period”). The complaints allege that the defendants made false and misleading public statements about us and our business and prospects in the prospectus for the secondary offering, as well as in filings with the Securities and Exchange Commission and in press releases issued during the Class Period, and that the market price of our common stock was artificially inflated as a result. The complaints allege claims under Sections 11 and 15 of the Securities Act of 1933, and under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The plaintiffs in both cases seek compensatory damages on behalf of the alleged class and award of attorneys’ fees and costs of litigation. We believe we have valid defenses to the claims and intend to defend the litigation vigorously. On July 28, 2005, the court entered an order allowing the plaintiffs to file a single consolidated and amended complaint up to 60 days after the appointment of a lead plaintiff in the case, and allowing us up to 60 days following the filing of the amended complaint in which to file an answer. On September 6, 2005, a motion for appointment of a lead plaintiff was filed. As of November 4, no lead plaintiff had been appointed. Once a lead plaintiff is appointed, the plaintiffs will have 60 days to file a consolidated amended complaint.

It is not possible at this time to estimate the possibility of a loss or the range of potential losses arising from these claims. We may, however, incur material legal fees with respect to its defense of these claims. The claims have been submitted to the carriers of our executive and organization liability insurance policies. The policies have primary and excess coverage that we believe will be adequate to defend this case and are subject to a retention for securities claims. As of November 8, 2005, we had incurred an immaterial amount of legal fees in defense of these claims.

9. Income Taxes

During the quarter ended September 30, 2005, we booked a $0.6 million tax-basis valuation allowance relating to capital loss carry-forwards that management does not believe will be offset by sufficient future capital gains before they expire. This caused our year-to-date effective tax rate to increase from 37.5% during 2004 to 40.5% in 2005. This valuation allowance had an affect on net income of $0.6 million during both the third quarter and nine months ended September 30, 2005. The effect on basic and diluted earnings per share for the third quarter and nine months ended September 30, 2005, was $0.04.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Unless otherwise noted in this report, any description of “us” refers to StarTek, Inc. and our subsidiaries.

All statements contained in this Form 10-Q that are not statements of historical facts are forward-looking statements that involve substantial risks and uncertainties. Forward-looking statements are preceded by terms such as “may,” “will,” “should,” “anticipates,” “expects,” “believes,” “plans,” “future,” “estimate,” “continue,” “intends,” “budgeted,” “projections,” “outlook” and similar expressions. The following are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors include, but are not limited to, loss of our principal clients, concentration of our client base in a few select industries, consolidation of our clients’ businesses, highly competitive markets, risks related to our contracts, decreases in numbers of vendors used by clients or potential clients, lack of success of our clients’ products or services, considerable pricing pressure, risks relating to fluctuations in the value of our investment securities portfolio, risks associated with advanced technologies, inability to grow our business, inability to effectively manage growth, dependence on qualified employees and key management personnel, potential future declines in revenue, lack of a significant international presence, and risks relating to conducting business in Canada. These factors include risks and uncertainties beyond our ability to control, and in many cases we cannot predict the risks and uncertainties that could cause actual results to differ materially from those indicated by use of forward-looking statements. Similarly, it is impossible for management to foresee or identify all such factors. As such, investors should not consider the foregoing list to be an exhaustive statement of all risks, uncertainties, or potentially inaccurate assumptions. All forward-looking statements herein are made as of the date hereof, and we undertake no obligation to update any such forward-looking statements. All forward-looking statements herein are qualified in their entirety by information set forth in our annual report on Form 10-K for the year ended December 31, 2004, entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Risk Factors.”

Executive Overview

We are a leading provider of business process outsourced services, which consist primarily of business process management services. Our business process management services include provisioning management, wireless telephone number porting, receivables management, wireless telephone activations, and high-end technical support and customer care services. Currently, we provide business process management services from sixteen operational facilities, totaling over one million square feet in the United States of America and Canada. We have also contracted to lease a seventeenth business process management services facility in Petersburg, Virginia, which is expected to open in early 2006.

We have developed expertise in serving clients in technically-oriented industries which are characterized by rapid growth, complex and evolving product offerings and large customer bases. Our primary clients are in the telecommunications industry, but we also serve clients in the computer software and hardware, consumer products, cable TV, internet, and e-commerce industries. We have a strategic partnership philosophy through which we assess each of our clients’ needs and together with our clients, develop and implement customized outsourced services. We strive to continuously expand our service offerings in response to the growing needs of our clients and to capitalize on market opportunities. We intend to capitalize on a growing trend toward outsourcing by focusing on potential clients in additional industries that could benefit from our expertise in developing and delivering integrated, cost-effective, outsourced services.

Over the past several years, we have achieved organic growth in our operations as measured by the number of our business process outsourcing facilities, customers, employees, and volume. The principal elements of our current growth strategy are to:

• use our expertise in complex process management to address untapped opportunities,

• strengthen strategic partnerships and long-term relationships with existing clients,

• expand our client base in new vertical markets,

• maintain a disciplined approach to expansion, and

• explore international opportunities.

We believe that our current growth strategy will enable us to remain an effective competitor in the business process management services industry for the foreseeable future.

We also provide supply chain management services, which include packaging, fulfillment, marketing support and logistics services. It is management’s intent to sell the remaining assets and liabilities of the SCM platform and at

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September 30, 2005, we were in negotiations to do so. These assets and liabilities include all of the remaining assets of the supply chain management services platform, including a facility, inventory, accounts receivable and payable, and prepaids. This deal has not yet been finalized. As such, these assets and liabilities were reported as held for sale as of September 30, 2005, and December 31, 2004, in our consolidated balance sheets. Likewise, the results of operations from the supply chain platform, net of tax, were reported as discontinued operations for the three- and nine-month periods ended September 30, 2005, and 2004.

We provided business process management services from two facilities in Hartlepool, England through our operating subsidiary, StarTek Europe, Ltd., until September 30, 2004, when this subsidiary was sold to a third party. The results of operations from StarTek Europe, Ltd. have been reported as discontinued operations for the three-and nine-month periods ended September 30, 2004.

The results from continuing operations of our third quarter of 2005 reflected an improvement in gross margin while revenues remained relatively flat. This is as a result of volume and revenue mix shifts between our largest clients during the quarter. Income before income taxes from continuing operations for the third quarter of 2005 increased $0.7 million due to increased gross profit, a net reduction in operating expenses resulting primarily from cost realignment, and an increase in net interest and other income driven by a one-time gain on the sale of a facility located in Greeley, Colorado.

Cash and cash equivalents declined $0.6 million during the third quarter of 2005 compared to December 31, 2004. Working capital of $79.5 million reflected an decrease of $9.1 million from December 31, 2004, primarily as a result of decreases in accounts and income taxes receivable.

Results of Operations

The following table sets forth certain unaudited condensed consolidated income statement data as a percentage of revenue from continuing operations (dollars in thousands):

	Three Months Ended September 30,										Nine Months Ended September 30,
	2005					2004					2005					2004
Revenue	$	53,877		100.0	%	$	54,448		100.0	%	$	158,206		100.0	%	$	163,861		100.0	%
Cost of services		41,353		76.8	%		42,232		77.6	%		121,645		76.9	%		118,961		72.6	%
Gross profit		12,524		23.2	%		12,216		22.4	%		36,561		23.1	%		44,900		27.4	%
Selling, general and administrative expenses		7,190		13.3	%		7,357		13.5	%		21,402		13.5	%		20,920		12.8	%
Operating profit		5,334		9.9	%		4,859		8.9	%		15,159		9.6	%		23,980		14.6	%
Net interest and other income		1,060		2.0	%		793		1.5	%		1,098		0.7	%		2,566		1.6	%
Income before income taxes from continuing operations		6,394		11.9	%		5,652		10.4	%		16,257		10.3	%		26,546		16.2	%
Income tax expense		2,743		5.1	%		1,981		3.6	%		6,584		4.2	%		9,942		6.1	%
Net income from continuing operations		3,651		6.8	%		3,671		6.7	%		9,673		6.1	%		16,604		10.1	%
Loss on discontinued operations		(477	)	-0.9	%		(443	)	-0.8	%		(1,210	)	-0.8	%		(43	)	0.0	%
Net income	$	3,174		5.9	%	$	3,228		5.9	%	$	8,463		5.3	%	$	16,561		10.1	%

Revenue. Revenue from continuing operations declined 1.0% during the third quarter of 2005 when compared to the same period in the prior year. Increases in volume on some of our larger clients as well as revenue from new clients were offset by a continued shift by our second largest client’s volume away from higher-priced, higher-margin services, by the effect of our tiered pricing with our largest client, and by lower volume from some of our smaller clients.

Year-to-date, revenue declined $5.7 million, or 3.5%, compared to the same period the prior year. This decline was primarily attributable to a shift to lower-priced services by our second largest client as discussed above. Partially offsetting this decline was increased revenue from our largest client and from new clients.

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Cost of Services and Gross Profit. Cost of services declined 2.1% during the third quarter of 2005 when compared with the same period in the prior year. Gross margin increased from 22.4% during the third quarter of 2004 to 23.2% during the same period in 2005. The increase in gross margin was driven by improved capacity utilization resulting from increased volume on new business, partially offset by the $1.4 million foreign exchange impact of a stronger Canadian dollar and ramp costs associated with the launch of new clients.

For the first nine months of the year, cost of services increased 2.3% over the same period in the prior year. Gross margin decreased from 27.4% for the first nine months of 2004 to 23.1% for the same period in 2005. A volume shift away from higher-priced, higher-margin services on our second largest client and tiered pricing on our largest client were primarily responsible for this decline in gross margin. We were also affected by a stronger Canadian dollar in 2005 and underutilized capacity during the first half of 2005.

Selling, General and Administrative Expenses. During the third quarter of 2005, selling, general and administrative expenses decreased 2.3% compared with the same period in the prior year. As a percentage of revenue, selling, general and administrative expenses declined slightly year over year. This decrease was primarily attributable to decreased headcount, but was partially offset by $0.6 million in incremental expenses associated with our cost realignment.

As a percentage of revenue, selling, general and administrative expenses increased from 12.8% during the first nine months of 2004 to 13.5% during the same period in 2005. On a dollar basis, selling, general and administrative expenses increased $0.5 million year over year. Cost savings from decreased headcount in 2005 were more than offset by incremental expenses in 2005 related to our cost realignment and a full year of fixed costs associated with three new call centers opened throughout 2004.

Operating Profit. During the third quarter of 2005, operating profit increased approximately $0.5 million, or 9.8%. As a percentage of revenue, operating profit increased from 8.9% in third quarter of 2004 to 9.9% in third quarter of 2005. This increase was the result of an improvement in gross margin and a decrease in operating expenses, as discussed above.

Operating profit for the first nine months of 2005 decreased $8.8 million, or 36.8% from the same period in 2004. As a percentage of revenue, operating profit decreased to 9.6% from 14.6%. This decrease was primarily attributable to a decreased gross margin year-to-date, as discussed above.

Net Interest and Other Income. Net interest and other income increased $0.3 million, or 33.7%, during the three months ended September 30, 2005, primarily due to a $0.8 million gain on the sale of a facility located in Greeley, Colorado, offset by lower realized returns on our investment portfolio in 2005 than in 2004.

Year to date, net interest and other income was $1.5 million, or 57.2%, lower in 2005 than in 2004 primarily due to realized gains in our investment portfolio in 2004 versus realized losses in 2005. This is due in large part to the repositioning of our investment portfolio in line with our current investment portfolio policy.

Income Before Income Taxes from Continuing Operations. Third quarter 2005 income before income taxes from continuing operations was $0.8 million, or 13.1%, higher than the same period in 2004. This increase was due primarily to favorable year-over-year changes in gross margin, other income, and operating expenses, as discussed above.

Income before income taxes from continuing operations declined $10.3 million, or 38.7%, during the first nine months of 2005 when compared to the same period in 2004. The primary cause of this year-over-year decrease was a decline in gross margin in 2005, as discussed above.

Income Tax Expense. Income tax expense increased $0.8 to $2.7 million during the third quarter of 2005. Accordingly, our effective income tax rate increased from 37.5% during the first nine months of 2004 to 40.5% during the same period of 2005. These increases were the result of a $0.6 million tax-basis valuation allowance booked during the third quarter relating to capital loss carry-forwards that management does not believe will be offset by sufficient future capital gains before they expire. We have additional capital loss carry-forwards relating to our investment portfolio and we will continue to evaluate the likelihood that we will be able to utilize such carry-forwards in future periods.

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Discontinued Operations. At September 30, 2005, we reported the results of operations related to our supply chain management services platform as discontinued operations due to management’s intent to sell these net assets. Results of operations from our supply chain management services platform resulted in a loss net of tax of $477 thousand and $1.2 million during the three-and nine-month periods ending September 30, 2005, respectively. Results of operations from supply chain management services platform resulted in a gain net of tax of $1.3 million and $2.5 million during the three-and nine-month periods ending September 30, 2004, respectively.

On September 30, 2004, we sold StarTek Europe, Ltd., our operating subsidiary in the United Kingdom, which provided business process management services from two facilities in Hartlepool, England. As a result, the three- and nine-month periods ended September 30, 2004, included losses from discontinued operations, net of tax, of $1.7 million and $2.6 million, respectively.

Please refer to Item 1, Note 6 to our Condensed Consolidated Financial Statements, Discontinued Operations, for further discussion of these transactions.

Net Income. Net income decreased $0.1 million to $3.2 million during the third quarter of 2005 when compared to the third quarter of 2004. Net income of $8.5 million during the first nine months of 2005 was $8.1 million lower than the same period in the prior year. The year-over-year declines in net income are the result of the reasons described above in revenue, gross profit, operating expenses, and income tax expense.

Liquidity and Capital Resources

As of September 30, 2005, we had working capital of $79.5 million, which represented a decline of $9.1 million from December 31, 2004. This decline was attributable in part to decreases in accounts and income taxes receivable. Changes in these specific accounts are more fully explained in “Net Cash provided by Operating Activities” below.

We have historically financed our operations, liquidity requirements, capital expenditures, and capacity expansion primarily through cash flows from operations, and to a lesser degree through various forms of debt and leasing arrangements. In addition to funding basic operations, our primary uses of cash relate to capital expenditures to upgrade our existing information technologies, the payment of dividends, and investments in our facilities. We believe that cash flows from operations and cash provided by short-term borrowings, when necessary, will adequately meet our ongoing operating requirements, scheduled principal and interest payments on debt, dividend payments and anticipated capital expenditures. However, our liquidity could be significantly impacted by a decrease in demand for our services, particularly from any of our principal clients, which could arise from a number of factors, including, but not limited to, competitive pressures, adverse trends in the business process outsourcing market, industry consolidation, adverse circumstances with respect to the industries we service, and any of the other factors we describe more fully in the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2004.

Net Cash Provided by Operating Activities. Net cash provided by operating activities increased $18.2 million for the nine months ended September 30, 2005, when compared to the same period in 2004. Driving this increase was an effect on cash flow year-over-year from income taxes receivable which was attributable to timing of estimated tax payments and an $8 million tax refund in 2005 resulting from a 2004 overpayment of our estimated tax liability. Also contributing to the increase in net cash provided by operating activities was a significant decrease in accounts receivable compared to the prior year. This was the result of higher collections coupled with an unusually high receivables balance at December 31, 2004, resulting from timing of payments from our customers. Partially offsetting these increases in net cash provided by operating activities were decreases in net income, as discussed earlier in this section, accounts payable and accrued liabilities, which was the result of timing of planned expenditures.

Net Cash Used in Investing Activities. Net cash used in investing activities increased $11.9 million during the nine months ended September 30, 2005, versus the same period in the prior year. The increase was predominately the result of a change in our approach to investing, wherein we began to invest in more short-term investment grade instruments, partially in response to market conditions. This change in approach resulted in an $18.9 million year-over-year change in net available for sale investment activity. This change was offset somewhat by lower net capital expenditures, as compared to prior year, during which time we invested more heavily in increasing our capacity, as well as the 2005 sale of a facility in Greeley, Colorado.

We plan to use our capital expenditures in the fourth quarter of 2005 to develop a new site in Petersburg, Virginia, as well as to upgrade and expand our information technology infrastructure. Our actual capital expenditures may vary depending on the infrastructure required in order to give quality service to our customers, including possible capacity expansion to service additional

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business from new or existing clients. We believe our existing facilities, including the facility we are currently developing in Petersburg, Virginia, are adequate for our current operations, but additional capacity expansion, including opening additional facilities, may be required to support our future growth. While we strive to make the best use of the space we have, management intends to maintain a certain amount of excess capacity to enable us to readily provide for the needs of new clients and the increasing needs of existing clients. Our anticipated investment in information technology infrastructure is geared toward remaining competitive in our current business, acquiring additional functionalities necessary for us to be able to compete for new business and refreshing our current technology.

Net Cash Provided by Financing Activities. Our net cash used in financing activities increased $14.0 million for the nine month period ended September 30, 2005, when compared with the same period in 2004, due in large part to $10.0 million in proceeds from borrowings under our secured equipment loan in 2004 (see “Outstanding Debt” below). Excluding these borrowings, the $4.0 million increase was primarily the result of principal payments on our secured equipment loan and reduced proceeds from stock option exercises.

Outstanding Debt. In February 2004, we entered into a secured equipment loan with Wells Fargo Equipment Finance, Inc. in the amount of $10.0 million. The loan bears interest at a rate of 3.65% per annum. Principal and interest are payable in 48 monthly installments of $224 thousand. The loan is secured by certain furniture, telephone and computer equipment. As of September 30, 2005, we had $6.2 million outstanding under this loan.

We also maintain a $10.0 million unsecured line of credit with Wells Fargo Bank, N.A. (the Bank) which we use to finance regular, short-term operating expenses. On June 29, 2005, we amended and renewed this agreement such that the last day under which the Bank will make advances under the line of credit will be June 30, 2007. Borrowings under this line of credit bear interest at either a fluctuating rate per annum that is 1% below the Prime Rate or at a fixed rate per annum determined by the Bank to be 1.5% above LIBOR. Interest expense associated with this facility totaled $14.0 thousand in the third quarter of 2005. Under this line of credit, we must generate net profit after tax of at least $1 on a rolling four-quarter basis, measured quarterly, and are not permitted to incur net losses in any two consecutive quarterly periods. We were required to hold a tangible net worth of $90.0 million at December 31, 2004, and at the close of each subsequent quarter, we are required to have a minimum tangible net worth equal to the minimum tangible net worth we were required to have at the end of the prior fiscal period plus 25% of net income (if positive). The minimum tangible net worth applicable as of September 30, 2005, was $92.1 million. No amounts were outstanding under this line of credit as of September 30, 2005, and we were in compliance with all of our debt covenants related to this facility.

Dividend Information. We paid a cash dividend of $0.36 per share, aggregating approximately $5.3 million, on August 24, 2005. We also declared a dividend of $0.36 per share, aggregating to approximately $5.3 million, on November 2, 2005, payable on November 23, 2005, to our stockholders of record as of November 14, 2005. At this time, we expect to continue to pay quarterly dividends on our common stock. The payment of any dividends, however, will be at the discretion of our board of directors and will depend on, among other things, availability of funds, future earnings, cash flow, capital requirements, contractual restrictions, our general financial condition and business conditions.

Contractual Obligations. Other than operating leases for certain equipment and real estate and commitments to purchase goods and services in the future, in each case as reflected in the table below, we have no significant off-balance sheet transactions, unconditional purchase obligations or similar instruments, and we are not a guarantor of any other entities’ debt or other financial obligations. The following table presents a summary of our contractual obligations and payments, by period, as of September 30, 2005:

	Less Than		One to Three		Four to		More than
	One Year		Years		Five Years		Five Years		Total
Long-term debt (1)	$	2,528	$	3,766	$	—	$	—	$	6,294
Operating leases (2)		3,656		6,411		4,226		3,001		17,294
Purchase obligations (3)		8,039		7,023		24		—		15,086
Total contractual obligations	$	14,223	$	17,200	$	4,250	$	3,001	$	38,674

(1) Long-term debt consists of our $10.0 million 3.65% fixed rate equipment loan, as discussed above, and debt associated with our Greeley North facility, which is forgiven at a rate of $26 thousand per year as long as we remain in the facility.

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(2)	We lease facilities and equipment under various non-cancelable operating leases.
(3)	Purchase obligations include commitments to purchase goods and services that in some cases may include provisions for cancellation.

Other Factors Impacting Liquidity. Effective November 4, 2004, our Board of Directors authorized purchases of up to $25 million of our common stock. The repurchase program will remain in effect until terminated by the Board of Directors and will allow us to repurchase shares of our common stock from time to time on the open market, in block trades and in privately-negotiated transactions. Repurchases will be implemented by the Chairman of the Board consistent with the guidelines adopted by the Board of Directors from time to time and will depend on market conditions and other factors. Any repurchased shares will be made in accordance with Securities and Exchange Commission rules. We did not repurchase any shares during the three- or nine-month periods ended September 30, 2005.

Our business currently has a high concentration on a few principal clients. The loss of a principal client and/or changes in timing or termination of a principal client’s product launch or service offering would have a material adverse effect on our business, liquidity, operating results, and financial condition. The following table represents revenue concentrations of our principal clients:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2005			2004			2005			2004
Cingular Wireless, LLC (formerly AT&T Wireless Services, Inc.)		51.7	%		50.8	%		54.3	%		50.3	%
T-Mobile, a subsidiary of Deutsche Telekom		25.9	%		26.4	%		23.6	%		30.2	%
AT&T Corp.		10.9	%		11.0	%		11.4	%		11.8	%

These client relationships are further discussed in Item 1, Footnote 4 to our Condensed Consolidated Financial Statements, Principal Clients. AT&T Corp. has entered into an agreement to be acquired by SBC Communications, Inc. in a transaction the parties expect to complete during the fourth quarter of 2005. SBC is not currently our client, and although we expect to continue providing services to AT&T at similar levels to what we have provided in recent periods and believe that this transactions may present opportunities for us to win additional business, there can be no assurance that if the transaction is completed, SBC will continue to use our services.

To limit our credit risk, management from time to time will perform credit evaluations of our clients. Although we are directly impacted by the economic conditions in which our clients operate, management does not believe substantial credit risk existed as of September 30, 2005.

Although management cannot accurately anticipate effects of domestic and foreign inflation on our operations, management does not believe inflation has had, or is likely in the foreseeable future to have, a material adverse effect on our results of operations or financial condition.

Variability of Operating Results

Our business has been seasonal and is at times conducted in support of product launches for new and existing clients. Historically, our revenue has been substantially lower in the quarters preceding the fourth quarter due to timing of our clients’ marketing programs and product launches, which are typically geared toward the holiday buying season. For 2005, we anticipate lower variations in quarterly revenue than has historically been the case. Moreover, our revenue and operating results for the three months ended September 30, 2005, are not necessarily indicative of revenue or operating results that may be experienced in future periods. However, we have experienced and expect to continue to experience some quarterly variations in revenue and operating results due to a variety of factors, many of which are outside our control, including: (i) changes in the volume of services provided to principal clients, (ii) timing and amount of costs incurred to expand capacity in order to provide for volume growth from existing and future clients, (iii) timing of existing and future client product launches or service offerings; (iv) expiration or termination of client projects or contracts; (v) seasonal nature of certain clients’ businesses; and (vi) cyclical nature of certain high technology clients’ businesses. As a result of these factors, our revenue and operating results for the three months ended September 30, 2005, are not necessarily indicative of revenue or operating results that may be experienced in future periods.

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Critical Accounting Estimates

In preparing our condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management must undertake decisions that impact the reported amounts and related disclosures. Such decisions include the selection of the appropriate accounting principles to be applied and assumptions upon which accounting estimates are based. Management applies its best judgment based on its understanding and analysis of the relevant circumstances to reach these decisions. By their nature, these judgments are subject to an inherent degree of uncertainty. Accordingly, actual results may vary significantly from the estimates we have applied.

Our critical accounting estimates are consistent with those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2004, with the exception of our estimates surrounding our health care insurance, as discussed below. Please refer to Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in our Annual Report on Form 10-K for the year ended December 31, 2004, for a complete description of our Critical Accounting Estimates.

As of January 1, 2005, we changed our employee health care insurance coverage from a fully-insured to a self-insured plan. As such, our liability balance of $188 thousand as of December 31, 2004, reflected accrued premiums due to our fully insured health care provider. As of September 30, 2005, our liability balance increased to $750 thousand reflecting an estimate of the liability amount that we consider to be appropriate given industry statistics, our employee base, expert opinion and management judgment. Our actual liability under these plans may differ significantly from this estimate. We have stoplosses at both an individual and corporate level which limit our total exposure on these plans.

Item 3: Quantitative and Qualitative Disclosure About Market Risk

In the normal course of business, we are exposed to certain market risks related to changes in interest rates and other general market risks, equity market prices, and foreign currency exchange rates. We have established an investment portfolio policy which provides for, among other things, investment objectives and portfolio allocation guidelines. This policy was amended in October 2004 to provide for a more modest-risk portfolio than was present in prior years in order to maintain sufficient liquidity for corporate needs. All of our investment decisions are supervised or managed by our Chairman of the Board.

This discussion contains forward-looking statements subject to risks and uncertainties. Actual results could vary materially as a result of a number of factors, including but not limited to, changes in interest and inflation rates or market expectations thereon, equity market prices, foreign currency exchange rates, and those factors set forth in our Annual Report on Form 10-K under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Risk Factors.”

Interest Rate Sensitivity and Other General Market Risks

Cash and Cash Equivalents. At September 30, 2005, we had $14.0 million in cash and cash equivalents invested in various money market funds and overnight investments at a combined weighted average interest rate of approximately 2.68%. Cash and cash equivalents are not restricted. We consider cash equivalents to be short-term, highly liquid investments readily convertible to known amounts of cash, and so near their maturity they present insignificant risk of changes in value because of changes in interest rates. We do not expect any substantial loss with respect to our cash and cash equivalents as a result of interest rate changes, and the estimated fair value of our cash and cash equivalents approximates original cost. We paid a cash dividend to stockholders of $0.36 per share, aggregating $5.3 million, in August 2005. We also declared a dividend of $0.36 per share, aggregating approximately $5.3 million, on November 2, 2005, payable on November 23, 2005, to our stockholders of record as of November 14, 2005.

Outstanding Debt. We currently have two debt facilities in use: a $10.0 million unsecured revolving line of credit and a $10.0 million secured equipment loan. Borrowings under the $10.0 million line of credit typically bear interest at the lender’s prime rate less 1%, which was 5.75% as of September 30, 2005. Borrowings under the $10.0 million secured equipment loan bear interest at a fixed rate of 3.65% per annum and thereby carries risk from changing interest rates, however management does not believe the affect on our financial statements could be material. As of September 30, 2005, we had $6.2 million outstanding under this loan.

From time to time, we may borrow under our $10.0 million line of credit for general corporate purposes, including working capital requirements, capital expenditures, and other purposes related to expansion of our capacity. At September 30, 2005, we had no amounts outstanding on this line of credit. Borrowings under this line of credit bear interest at the lender’s prime rate less 1%, which was 5.75% as of September 30, 2005, although for certain borrowings, we may elect to pay a fixed rate equal to LIBOR plus 1.5%. We believe a hypothetical 10.0% increase in interest rates would not have a material adverse effect on our financial position. Increases in interest rates would, however, increase interest expense associated with future variable-rate borrowings by us, if any. We have not historically hedged our interest rates with respect to this or any of our other loans and we do not expect to hedge these rates in the future.

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As of September 30, 2005, we were in compliance with the all financial covenants pertaining to our line of credit. This line of credit is renewed every two years at the option of Wells Fargo and was last renewed in June of 2005. See Item 1, Note 7 to our Condensed Consolidated Financial Statements, Debt for further explanation of our line of credit renewal.

Investments Available for Sale. At September 30, 2005, we had investments available for sale which, in the aggregate, had a basis and fair market value of $35.9 million and $35.9 million, respectively. At September 30, 2005, investments available for sale generally consisted of investment-grade and non-investment grade corporate bonds, convertible bonds, mutual funds, and common stock. Our investment portfolio is subject to interest and inflation rate risks and will fall in value if market interest and/or inflation rates or market expectations relating to these rates increase.

A substantial decline in values of equity securities and equity prices in general would have a material adverse effect on our financial condition. Also, prices of common stocks we hold could generally be expected to be adversely affected by increasing inflation or interest rates or market expectations thereon, poor management, shrinking product demand, and other risks that may affect single companies or groups of companies, as well as adverse general economic conditions. At times we have partially hedged against some equity price changes; however, our hedging activities do not provide material protection against price fluctuations in securities we hold in our investment portfolio.

Historically, options have been an immaterial part of our overall investment portfolio, and we expect options will remain an immaterial part of our overall risk management approach in the future.

The fair market value of and estimated cash flows from our investments in corporate bonds are substantially dependent upon the credit worthiness of certain corporations expected to repay their debts to us. If such corporations’ financial condition and liquidity adversely changes, our investments in these bonds would be materially and adversely affected.

The table below provides information as of September 30, 2005, about maturity dates and corresponding weighted average interest rates related to certain of our investments available for sale:

	Weighted
	Average
	Interest																	Fair
	Rates			1 Year		2 Years		3 Years		4 Years		5 Years		Thereafter		Total		Value
Corporate
debt securities		3.68	%	$	33,966		—		—		—		—		—	$	33,966	$	33,984
Total				$	33,966		—		—		—		—		—	$	33,966	$	33,984

Management believes we have the ability to hold the foregoing investments until maturity, and therefore, if held to maturity, we would not expect the future proceeds from these investments to be affected, to any significant degree, by the effect of a sudden change in market interest rates. Declines in interest rates over time will, however, reduce our interest income derived from future investments.

Trading Securities. As of September 30, 2005, we were invested in an immaterial amount of trading securities consisting of option contracts. Trading securities have historically been held to meet short-term investment objectives and consisted of alternative investment partnerships and options contracts. From time to time we purchase or write option contracts to partially hedge against fluctuations in the value of our investment portfolio. All such options are publicly-traded with standard market terms. Such options are classified as trading securities and are recorded at fair value with changes in fair value recognized in current period earnings. We do not designate such options as hedging instruments pursuant to SFAS No. 133.

We do not consider the risk of loss regarding our current investments in the event of nonperformance by any party to be substantial. Due to the potential limited liquidity of some of these instruments, the most recently traded price may be different from values that might be realized if we were to sell or close out the transactions. Management does not believe such differences are substantial to our results of operations, financial condition, or liquidity. The foregoing put options may involve elements of credit and market risks in excess of the amounts recognized in our financial statements. A substantial decline and/or change in value of equity securities, equity prices in general, international equity mutual funds, investments in limited partnerships, and/or call and put options could have a material adverse effect on our portfolio of trading securities. Also, trading securities could be materially and adversely affected by increasing interest and/or inflation rates or market expectations thereon, poor management, shrinking product demand, and other risks that may affect single companies or groups of companies, as well as adverse economic conditions generally.

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Foreign Currency Exchange Risks

Our Canadian subsidiary’s functional currency is the Canadian dollar, which is used to pay labor and other operating costs in Canada. If an arrangement provides for us to receive payments in a foreign currency, revenue realized from such an arrangement may be lower if the value of such foreign currency declines. Similarly, if an arrangement provides for us to make payments in a foreign currency, cost of services and operating expenses for such an arrangement may be higher if the value of such foreign currency increases. For example, a 10% change in the relative value of such foreign currency could cause a related 10% change in our previously expected revenue, cost of services, and operating expenses. If the international portion of our business continues to grow, more revenue and expenses will be denominated in foreign currencies, which increases our exposure to fluctuations in currency exchange rates.

A total of 42.7% and 39.3% of our expenses for the quarter and year to date period ended September 30, 2005, were paid in Canadian dollars. Our U.S. and Canadian operations generate revenues denominated in U.S. dollars. During the third quarter of 2005, we entered into Canadian dollar forward contracts with Wells Fargo Bank, pursuant to which we purchased $16.0 million Canadian dollars. During the quarter ended September 30, 2005, we recorded $318 thousand realized gain on the settled Canadian dollar forward contracts in our consolidated statements of operations and recorded unrealized gains of $743 thousand in other comprehensive income. As of September 30, 2005, we have contracted to purchase approximately $19.0 million Canadian dollars to be delivered periodically through March of 2005 at a purchase price which is no more than $24.9 million and no less than $23.1 million. We plan to continue to hedge our exposure to fluctuations in the Canadian dollar relative to the U.S. dollar, primarily through the use of forward purchased contracts.

Item 4. Controls and Procedures

Evaluation of disclosure controls and procedures.

As required by Rule 13a-15(b) under the Securities Exchange Act of 1934 (the “Exchange Act”), management, with the participation of our chief executive officer and chief financial officer, evaluated the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective as of September 30, 2005.

Changes in internal controls over financial reporting.

There was no change in our internal control over financial reporting that occurred during the quarter ended September 30, 2005, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We and six of our present and former directors and officers have been named as defendants in West Palm Beach Firefighters’ Pension Fund v. StarTek, Inc., et al. (U.S. District Court, District of Colorado) filed on July 8, 2005, and John Alden v. StarTek, Inc., et al. (U.S. District Court, District of Colorado) filed on July 20, 2005. Each action is a purported class action brought on behalf of all persons (except defendants) who purchased shares of our common stock in a secondary offering by certain of our stockholders in June 2004, and in the open market between February 26, 2003, and May 5, 2005 (the “Class Period”). The complaints allege that the defendants made false and misleading public statements about us and our business and prospects in the prospectus for the secondary offering, as well as in filings with the Securities and Exchange Commission and in press releases issued during the Class Period, and that the market price of our common stock was artificially inflated as a result. The complaints allege claims under Sections 11 and 15 of the Securities Act of 1933, and under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The plaintiffs in both cases seek compensatory damages on behalf of the alleged class and award of attorneys’ fees and costs of litigation. We believe we have valid defenses to the claims and intend to defend the litigation vigorously. On July 28, 2005, the court entered an order allowing the plaintiffs to file a single consolidated and amended complaint up to 60 days after the appointment of a lead plaintiff in the case, and allowing us up to 60 days following the filing of the amended complaint in which to file an answer. On September 6, 2005, a motion for appointment of a lead plaintiff was filed. As of November 4, no lead plaintiff had been appointed. Once a lead plaintiff is appointed, the plaintiffs will have 60 days to file a consolidated amended complaint.

20

It is not possible at this time to estimate the possibility of a loss or the range of potential losses arising from these claims. We may, however, incur material legal fees with respect to our defense of these claims. The claims have been submitted to the carriers of our executive and organization liability insurance policies. The policies have primary and excess coverage that we believe will be adequate to defend this case and are subject to a retention for securities claims. As of November 8, 2005, we had incurred an immaterial amount of legal fees in defense of these claims.

We have been involved from time to time in other litigation arising in the normal course of business, none of which is expected by management to have a material adverse effect on our business, financial condition or results of operations.

Item 4. Submission of Matters to a Vote of Security Holders

There were no matters submitted to a vote of security holders during the quarter ended September 30, 2005. However, certain matters were submitted to a vote during our second quarter. A summarization of the results of this vote is included in our Form 10-Q for the quarter ended June 30, 2005.

Item 6. Exhibits

Exhibit No.	Description
10.23	Offer letter for Rodd E. Granger effective as of August 1, 2005 (incorporated by reference to Form 8-K filed August 8, 2005).
10.24	Confidential Severance Agreement and General Release between StarTek, Inc. and Lawrence Zingale.
10.39*	Master Services Agreement and Statements of Work dated September 20, 2005, between StarTek USA, Inc. and T-Mobile USA, Inc.
10.62	Facility lease agreement between StarTek USA, Inc. and South Crater Square Associates, LLC (incorporated by reference to Form 8-K filed October 11, 2005).
31.1	Certification of Steven D. Butler pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Rodd E. Granger pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Written Statement of the Chief Executive Officer and Chief Financial Officer furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).

* Certain portions of this exhibit have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

21

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has fuly caused this Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.

/s/ STEVEN D. BUTLER	President and Chief Executive	Date: November 9, 2005
Steven D. Butler	Officer
/s/ RODD E. GRANGER	Executive Vice President and	Date: November 9, 2005
Rodd E. Granger	Chief Financial Officer

22

Exhibit Index

Exhibit No.	Description
10.23	Offer letter for Rodd E. Granger effective as of August 1, 2005 (incorporated by reference to Form 8-K filed August 8, 2005).
10.24	Confidential Severance Agreement and General Release between StarTek, Inc. and Lawrence Zingale.
10.39*	Master Services Agreement and Statements of Work dated September 20, 2005, between StarTek USA, Inc. and T-Mobile USA, Inc.
10.62	Facility lease agreement between StarTek USA, Inc. and South Crater Square Associates, LLC (incorporated by reference to Form 8-K filed October 11, 2005).
31.1	Certification of Steven D. Butler pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Rodd E. Granger pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Written Statement of the Chief Executive Officer and Chief Financial Officer furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).

* Certain portions of this exhibit have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

23

EX-10.24

Exhibit 10.24

CONFIDENTIAL SEVERANCE AGREEMENT AND GENERAL RELEASE

This Confidential Severance Agreement and General Release (“Agreement”) is entered into this 31st day of August, 2005, by and between StarTek USA, Inc. (“StarTek”) and Lawrence Zingale (“Employee”). As used in this Agreement, “StarTek” shall include StarTek USA, Inc. and all of its parent, subsidiary and affiliated entities.

RECITALS

A.	Employee has been employed by StarTek in the capacity of Executive Vice President, Chief Operating Officer.
B.	Employee wishes to separate as an employee of StarTek effective September 30, 2005 (the “Separation Date”), and both parties desire to memorialize their agreement with respect to the terms and conditions of Employee’s termination of employment. The Separation Date is Employee’s last physical working day with StarTek.
C.	StarTek is willing to provide severance pay and continuation of benefits as set forth herein in consideration of Employee entering into this Agreement and complying with Employee’s obligations hereunder.

AGREEMENT

In consideration of the foregoing recitals and the mutual promises contained herein, the parties agree as follows:

1.

Employee hereby separates as an employee effective as of Separation Date.

2.

In exchange for the release of claims and general waiver set forth in paragraphs 9 and 10 below, compliance by Employee with the non-disparagement and confidentiality provisions set forth in paragraphs 11 and 12 below, and compliance with Employee’s ongoing obligations set forth in the Executive Confidentiality and Non-Competition Agreement (the “Executive Agreement”) addressed in more detail in paragraphs 2(e) and 14, below, StarTek agrees to provide Employee with the following after Employee has executed this Agreement and the revocation period set forth in paragraph 10(i) below has expired:

a.	Nine (9) months of severance pay in the aggregate amount of Two hundred and sixty-two thousand, nine hundred and forty-five dollars and eight cents (“$262,945.08”) based on Employee’s current base salary, less any and all required deductions and withholdings. Specifically, severance pay equaling a period of three (3) months in the amount of Eighty-seven thousand, six hundred and forty-eight dollars and thirty-six cents (“87,648.36”) will be paid in a lump-sum payment on October 7, 2005, less any and all required deductions and withholdings. The remaining severance pay equaling a period of six (6) months in the amount of One hundred and seventy-five thousand, two hundred and ninety-six dollars and seventy-two cents (“175,296.72”) will be paid in a lump-sum payment on January 9, 2006, less any and all required deductions and withholdings.
b.	An incentive bonus of Sixty thousand dollars (“$60,000”) paid on January 9, 2006, less any and all required deductions and withholdings, if clearly agreed upon milestones are met by Employee as of September 30, 2005 (see attached list of agreed upon milestones). Employee will receive written confirmation on Separation Date, a copy of which will also be placed in Employee’s personnel file, regarding commitment by StarTek to pay said incentive bonus on January 9, 2006.
c.	The sum of Three thousand, eight hundred and twenty-three dollars and twenty cents (“$3,823.20”) representing nine (9) months of the company contribution to Employee’s medical insurance in the aggregate amount, the receipt and sufficiency of which Employee hereby acknowledges, to be paid on October 7, 2005, less any and all required deductions and withholdings.
d.	Accrued, but unused Paid Time Off in accordance with StarTek’s current policies as of the Separation Date to be paid on October 7, 2005, less any and all required deductions and withholdings. Employee acknowledges that payment of such amount shall discharge and liquidate all amounts payable to Employee for accrued Paid Time Off.

e. A release of Employee’s post-employment non-compete obligations set forth in paragraphs 4(B) and 4(C) of the Executive Agreement. The parties agree that all terms contained in paragraph 4(B) and 4(C), including any right Employee may have to receive severance or termination pay, are hereby waived and nullified, but that Employee remains subject to certain ongoing post-termination obligations set forth in the Executive Agreement including but not limited to those set forth in paragraph 4(D) of the Executive Agreement. In addition, and in further consideration for the payments he is receiving under this Agreement, Employee agrees that he will not be involved in the solicitation of services to any StarTek client as of September 30^th, 2005 for any other company until after October 1^st, 2006.

3.	If Employee was previously issued stock options, Employee has 90 days from the Separation Date to exercise any vested options. Vested options must be exercised during this period to avoid forfeiture. All unvested options as of the Separation Date shall terminate. Questions regarding stock options can be directed to Shelby Test-Peralta by calling 303-262-4524.
4.	Medical, dental, and vision coverage will end on September 30, 2005. After September 30, 2005, Employee may timely elect continued coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA). Information regarding COBRA will be sent to Employee directly from our third-party administrator.
5.	Employee shall return to StarTek any and all property of StarTek, including, without limitation, company badges, keys, pagers, codes, lists, tapes, discs, computer hardware, software and proprietary databases and/or codes, and all information comprising or relating to StarTek’s computer and telephone systems, network security, and customer information.
6.	Employee agrees not to have any direct or indirect contact with any customers, vendors, or individuals employed by StarTek to discuss any matters relating to the business of StarTek.
7.	Employee agrees he will not access, or attempt to access, StarTek’s computer network and/or databases. Further, Employee shall not modify or circumvent, or attempt to modify or circumvent, StarTek’s computer network or security and/or databases.
8.	StarTek agrees to provide a reference upon request to StarTek’s human resources department from any prospective employer with whom Employee has applied for employment. Any such reference to prospective employers shall only provide information describing Employee’s dates of employment with StarTek and positions held by Employee.
9.	For and in consideration of this Agreement, Employee, for himself and his respective heirs, successors and assigns, hereby releases and discharges StarTek, its successors, assigns, affiliates, parent corporation, agents, representatives, attorneys, principals, insurers, its past and present directors, officers, shareholders and employees, and any and all other persons, firms or corporations who are or might be liable through StarTek (collectively, the “StarTek Releasees”), from any and all claims, actions, causes of action, damages, demands, costs, loss of service, expenses, wages, or compensation of any kind (hereinafter “Claims”), whether such Claims are known or unknown, arising from the beginning of time to the date of this Agreement. The Claims released by this Agreement include, but are not limited to, any and all Claims arising out of or relating to the statements, actions or omissions of any StarTek Releasee; all Claims for any alleged unlawful discrimination, harassment, retaliation or reprisal, or other alleged unlawful practices arising under any federal, state, or local statute, ordinance or regulation or common law, including, without limitation, Claims under Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Age Discrimination in Employment Act, the Americans With Disabilities Act, 42 U.S.C. § 1981, the Employee Retirement Income Security Act, the Equal Pay Act, the Fair Credit Reporting Act, the Fair Labor Standards Act, the Occupational Safety and Health Act, the Colorado Wage Act, the Colorado Anti-Discrimination Act, the Family and Medical Leave Act, or any similar state laws or statutes; all Claims for alleged wrongful discharge, breach of contract (including but not limited to any claim for severance or termination pay under paragraph 4(B) of the Executive Agreement), breach of implied contract, failure to keep any promise, breach of a covenant of good faith and fair dealing, breach of fiduciary duty, estoppel, defamation, infliction of emotional distress, fraud, misrepresentation, negligence, harassment, retaliation or reprisal, constructive discharge, invasion of privacy, interference with contractual or business relationships, any other wrongful employment practices, and violation of any other principle of common law; all Claims for compensation of any kind, including, without limitation, salary, bonuses, commissions, wages, stock-based compensation or stock options, vacation pay, 401(k) contributions; all Claims for back pay, front pay, reinstatement, other equitable relief, compensatory damages, damages for alleged personal injury, liquidated damages and punitive damages; all Claims for attorneys’ fees, costs and interest; and all Claims relating to Employee’s employment with StarTek and/or Employee’s separation from StarTek. It is Employee’s intention to fully, finally, and forever settle and release any and all Claims that do exist, may exist, or heretofore have existed by Employee against StarTek.

10. Employee acknowledges that:

     a. By executing this Agreement, Employee waives all rights or claims, if any, that Employee may have against StarTek under the Age Discrimination in Employment Act of 1967, 29 U.S.C. § 626, et seq. (“ADEA”);

     b. This Agreement has been written in a manner calculated to be understood by Employee, and is in fact understood by Employee;

     c. The aforementioned waiver reflects specifically, but is not limited to, all rights or claims, if any, that Employee may have against StarTek arising under the ADEA;

     d. Employee is not waiving rights and claims that Employee may have under the ADEA against StarTek that may arise after the date on which this Agreement is executed;

     e. Employee is waiving rights and claims that Employee may have under the ADEA, if any, only in exchange for consideration in addition to anything of value to which Employee is already entitled;

     f. Employee is advised and has had the opportunity to consult with an attorney of Employee’s choice prior to executing this Agreement;

     g. Employee has been given a period of 21 days from the date on which Employee receives this Agreement, not counting the day upon which Employee receives the Agreement, within which to consider whether to sign this Agreement;

     h. If Employee wishes to execute this Agreement prior to the expiration of the 21-day period set forth in subsection (g) of this paragraph 10, Employee may do so;

     i. Employee has been given a period of 7 days following the execution of this Agreement to revoke Employee’s waiver of all claims, if any, under the ADEA, and Employee’s release of any claims under the ADEA shall not become effective or enforceable until the revocation period has expired without Employee revoking Employee’s waiver of all claims under the ADEA; and

     j. To revoke Employee’s waiver of all claims under the ADEA, Employee understands that Employee must deliver a written, signed statement that Employee revokes Employee’s waiver of all claims under the ADEA to the Company by hand or by mail within the 7 day revocation period. The revocation must be postmarked within the period stated above and properly addressed to:

Shelby Test-Peralta
Vice President
Human Resources
StarTek, Inc.
100 Garfield Street
Denver, CO 80206

11.

Employee agrees not to disparage StarTek, its employees, officers, directors, products or services in any way.

12.

Employee acknowledges that he occupied a position of trust and confidence at StarTek and had access to confidential information regarding StarTek. For purposes of this Agreement, “Confidential Information” shall mean all information concerning StarTek or its directors, officers, employees, agents or other representatives, regardless of the form of communication, together with all notes, analyses, studies, interpretations or other documents prepared by Employee to the extent containing or otherwise reflecting, in whole or in part, any such information; provided, however, the term “Confidential Information” shall not mean information that is or becomes generally available to the public, other than as a result of a disclosure by Employee or any of his representatives in breach or violation of this Agreement. Employee agrees to keep all Confidential Information and the terms of this Agreement STRICTLY CONFIDENTIAL and that he will cause the same of all of his representatives. Employee further agrees that he will not communicate (orally or in writing), or in any way voluntarily disclose or allow or direct others to disclose such Confidential Information or the terms of this Agreement to any person, judicial or administrative agency or body, business entity or association, or anyone else for any reason whatsoever, unless required to do so to enforce the terms of this Agreement, or pursuant to lawful subpoena or to an order of a court of competent jurisdiction, except that Employee may disclose the terms of this Agreement to Employee’s spouse, attorney and tax or financial advisor. If disclosure is made to any of the persons listed above, Employee agrees to inform such persons of the confidentiality requirements of this Agreement and will not make any disclosure to such persons without first obtaining the agreement of those persons to keep the information confidential.

13.	The parties agree that, except for the non-compete and associated termination pay provisions contained in paragraphs 4(B) and 4(C) of the Executive Agreement, the entire Executive Agreement remains in place and is not replaced, superseded or invalidated by this Agreement. Specifically, Employee acknowledges and agrees that he remains subject to the post-termination duties and obligations set forth in paragraphs 1 (Confidentiality), 2 (Proprietary Property), 3 (Ownership of Ideas and Documents), and 4(D) (non-solicitation of employees) contained in the Executive Agreement. In addition, and in further consideration for the payments he is receiving under this Agreement, Employee agrees that he will not be involved in the solicitation of services to any StarTek client as of September 30th, 2005 for any other company until after October 1st, 2006.
14.	It is expressly agreed that the provisions of paragraphs 11, 12 and 13 above are essential provisions of, and partial consideration for StarTek entering into this Agreement. Employee agrees that if he violates the terms of paragraphs 11, 12 and 13, StarTek shall be entitled to recover liquidated damages in the amount of the aggregate severance payment referenced in paragraph 2(a) above as well as the full incentive bonus referenced in paragraph 2(b) above and the aggregate amount of company contribution to medical insurance referenced in paragraph 2(c) above, and StarTek shall be awarded its attorneys’ fees and costs relating to enforcement of paragraphs 11, 12 and 13.
15.	Employee will, at any future time, be available upon reasonable notice from StarTek, with or without subpoena, to be interviewed, review documents or things, give depositions, testify, or engage in other reasonable activities, with respect to matters concerning which Employee has or may have knowledge as a result of or in connection with his employment by StarTek. In performing his obligations under this paragraph to testify or otherwise provide information, Employee will honestly, truthfully, forthrightly, and completely provide the information requested. Employee will comply with this paragraph upon notice from StarTek that StarTek or its attorneys believe that Employee’s compliance would be helpful in the resolution of an investigation or the prosecution or defense of claims StarTek will pay all reasonable and necessary expenses that Employee incurs in performing such activities and, to the extent Employee faces any individual liability for acts or omissions that occurred while serving as an officer of StarTek, will provide the same insurance coverage, indemnification and other protections, as if Employee was still an officer of StarTek.
16.	Employee agrees to indemnify and hold StarTek and each StarTek Releasee harmless from and against any and all claims, damages, losses and liabilities (including reasonable attorneys’ fees and expenses) arising out of or resulting from any breach of this Agreement by Employee. Employee agrees that irreparable injury may result to StarTek if Employee breaches any provision hereof and that money damages would not be a sufficient remedy therefore. Employee therefore agrees that if he engages, or causes or permits any other person to engage, in any act in breach of any provision hereof, then StarTek shall be entitled, in addition to all other remedies, damages and relief available under applicable law or this Agreement, to seek an injunction prohibiting Employee (or such other person) from engaging in any such act or specifically enforcing this Agreement.
17.	The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto, their successors and assigns.
18.	The validity, meaning, and effect of this Agreement shall be determined in accordance with the laws of the State of Colorado.
19.	No waiver, modification, amendment, discharge, or change of this Agreement shall be valid unless the same is in writing and signed by the party against which the enforcement of such modification, waiver, amendment, discharge, or change is sought.
20.	This Agreement and the Executive Agreement referenced in paragraphs 2(e) and 13 above, contain the entire agreement between the parties relating to the matters addressed herein, and all other prior or contemporaneous agreements, understandings, representations or statements, oral or written, are superseded hereby.
21.	Any provision of the Agreement which is unenforceable or invalid or the inclusion of which would affect the validity, legality or enforcement of this Agreement, shall be of no effect, but all the remaining provisions of the Agreement shall remain in full force and effect.
22.	In the event of any controversy, claim or suit affecting or relating to the subject matter or performance of this Agreement, the prevailing party shall be entitled to recover from the non-prevailing party all of its reasonable expenses, including reasonable attorneys’ fees and costs.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

Signature of President & Chief Executive Officer StarTek USA, Inc.	/s/ Steve Butler Steve Butler	8/31/05 Date
Employee Signature	/s/ Lawrence Zingale	8/31/05
	Lawrence Zingale	Date

EX-10.39

                                                                   EXHIBIT 10.39

Portions of this Exhibit marked with an "**" have been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request
for confidential treatment.

                 T-MOBILE USA SERVICE PARTNER SERVICES AGREEMENT

THIS SERVICES AGREEMENT (this "Agreement") is made effective as of August 1,
2005 (the "Effective Date"), between T-Mobile USA, Inc., a Delaware Corporation
with a principal place of business at 12920 SE 38th Street, Bellevue, Washington
98006 ("T-Mobile USA") and StarTek USA, Inc., a Colorado corporation with a
principal place of business at 100 Garfield Street, Denver, Colorado 80206
("Service Partner").

For good and valuable consideration, including the mutual covenants contained in
this Agreement, T-Mobile USA and StarTek USA, Inc. (together, the "Parties" and
individually, a "Party") agree as follows:

1.    SCOPE OF WORK.

      1.1.  Statement of Work. StarTek USA, Inc. agrees to perform the Services
            described in Exhibit A - 1 entitled "STATEMENT OF WORK - - [**]",
            Exhibit A - 2 entitled "STATEMENT OF WORK - [**]", Exhibit A - 3
            entitled "STATEMENT OF WORK - [**]", Exhibit A - 4 "STATEMENT OF
            WORK - [**]", Exhibit A - 5 "STATEMENT OF WORK - [**]", Exhibit A -
            6 "STATEMENT OF WORK - [**], The Parties acknowledge and agree that
            the Parties' ability to perform certain obligations pursuant to this
            Agreement is conditioned upon the full, proper and timely
            performance by the other Party of its obligations pursuant to this
            Agreement. Each Party shall cooperate fully with the other Party in
            carrying out the obligations pursuant to this Agreement in a timely
            and efficient manner and in accordance with the terms hereof.

      1.2.  Performance of Services. StarTek USA, Inc. shall comply in all
            material respects with all applicable registration and licensing
            requirements so as to enable StarTek USA, Inc. to perform the
            Services required under this Agreement. StarTek USA, Inc. shall have
            all necessary rights and licenses to use all software and hardware
            provided by it so as to enable StarTek USA, Inc. to perform the
            Services hereunder. The performance of the Services by StarTek USA,
            Inc. and use by each Party of all software and hardware provided by
            each party for the performance of Services in connection therewith
            will not infringe any trade name, trademark, services, copyright,
            patent, trade secret or other intellectual property or proprietary
            right of any third party.

2.    INVOICES AND PAYMENT.

      2.1.  Form of Invoices. All invoices for payment shall be submitted
            monthly to T-Mobile USA, within [**] business days after the [**]
            for payment. Such invoices shall meet the itemization guidelines
            outlined in T-Mobile USA Service Partner Invoice Guidelines .

      2.2.  Supporting Documentation. All invoices shall be accompanied by the
            supporting documentation and information set forth in the T-Mobile
            USA Service Partner Invoice Guidelines. T-Mobile USA may from time
            to time request additional information from StarTek USA, Inc. that
            may be derived from such supporting documentation and information.
            All [BILLED HANDLE MINUTES] for the Services must be supported and
            verifiable by [**]. All billed hours for the Services must

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            be supported and verifiable by agent level detail, labor summary
            reports or other mutually agreed supporting documentation.

      2.3.  Pricing. T-Mobile USA shall be obligated to pay StarTek USA, Inc.
            for Services pursuant to this Agreement at the prices provided in
            all Exhibits hereto. T-Mobile USA further agrees to pay [**], in
            connection with the provision, sale, or use of the Services provided
            hereunder.

      2.4.  Payment of Invoices. Except to the extent reasonably and in good
            faith disputed by T-Mobile USA, T-Mobile USA shall pay to StarTek
            USA, Inc. or their assignee all invoices [**]. Any undisputed amount
            (s) payable by T-Mobile USA to StarTek USA, Inc. hereunder that is
            not paid by T-Mobile USA [**] shall bear interest [**], not to
            exceed the maximum amount allowed by law, from the date such amount
            was due until the date payment is received by StarTek USA, Inc..

      2.5.  SERVICE PARTNER Invoicing Disputes and Request for Further
            Substantiation. T-Mobile USA will notify StarTek USA, Inc. of any
            invoicing disputes or requests for further substantiation within
            [**] of the receipt of the invoice. Such notice shall set forth in
            reasonable detail the amount disputed and the basis and facts upon
            which T-Mobile USA disputes or needs further information. Within
            [**], StarTek USA, Inc. shall respond to the individual designated
            for response in T-Mobile USA's written notice ("T-Mobile USA
            Representative") in writing with a detailed explanation stating the
            factual basis for demanding payment on any amount in dispute; and in
            the event StarTek USA, Inc. and the T-Mobile USA Representative are
            unable to resolve the dispute within [**] from the date of StarTek
            USA, Inc.'s response, the parties shall refer the matter to a Vice
            President of StarTek USA, Inc. and the Director for Service Partner
            Management of T-Mobile USA to be resolved. If the executives are
            unable to resolve the dispute within [**] from the date of referral,
            either party may pursue such other remedies as may be available to
            them. If T-Mobile USA does not provide notice of dispute as provided
            above, T-Mobile USA shall pay the invoice without prejudice to any
            rights it may have to later dispute the invoice. The undisputed
            portions of all invoices shall be paid in accordance with Section
            2.4 hereof. Amounts that have been disputed are payable within [**]
            of resolution of dispute and late charges as provided in 2.4 shall
            apply from the date of resolution of the applicable invoice if not
            paid within the [**].

      2.6.  Right of Audit. T-Mobile USA reserves the right to conduct 3 (three)
            separate types of audits, an operational audit, a financial audit
            and a [**].

            2.6.1. The Operational Audit will take place during SERVICE PARTNER
                  normal business hours, up to [**] per site with written
                  notification no less than [**] in advance. SERVICE PARTNER
                  shall keep complete and accurate records documenting the
                  performance of the specific KPIs (Key Performance Indicators)
                  as outlined in the SOW, Exhibit A. SERVICE PARTNER shall make
                  their records available to T-Mobile USA or any

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                  authorized representative of T-Mobile USA [**]. The cost of
                  any audit shall be borne by T-Mobile USA.

            2.6.2. The Financial Audit. SERVICE PARTNER shall keep complete and
                  accurate records and documentation to substantiate the amounts
                  claimed in any invoice, which records shall be made available
                  to T-Mobile USA for audit as set forth below. During SERVICE
                  PARTNER normal business hours and upon [**] prior written
                  notice, SERVICE PARTNER shall make its records available for
                  audit by T-Mobile USA or any authorized representative of
                  T-Mobile USA [**], and until [**] after completion of the
                  Services or [**] whichever occurs first.

            2.6.3. [**]. SERVICE PARTNER shall keep complete and accurate [**]
                  records and documentation related to the performance on all
                  T-Mobile lines of business. During SERVICE PARTNER normal
                  business hours and upon [**] written notice, SERVICE PARTNER
                  shall make its [**] records and [**] for all T-Mobile USA
                  lines of business available for audit by T-Mobile USA or a
                  third party named by T-Mobile USA. These [**] records and [**]
                  for T-Mobile USA lines of business shall be available until
                  [**] after completion of the Services or [**] whichever occurs
                  first.

      2.7.  Cost of Audit and Repayment. The cost of any audit shall be borne by
            T-Mobile USA, however, if the audit discovers an error in T-Mobile
            USA's favor that is [**] SERVICE PARTNER shall bear the cost of the
            audit. Any over-billing discovered as a product of such audit shall
            be repaid in full to T-Mobile USA within [**] unless otherwise
            negotiated and agreed by the parties.

3.    TERM AND TERMINATION.

      3.1.  Unless terminated sooner as provided herein, this Agreement shall
            commence as of the Effective Date and continue for a period of one
            (1) years.

            3.1.1. This agreement shall automatically renew for one-year, until
                  August 1, 2007, unless either party provides written notice of
                  non-renewal to the other party at least ninety (90) days prior
                  to the expiration to the current term, August 1, 2006.

      3.2.  Termination for Convenience and by Agreement. T-Mobile USA may
            terminate this Agreement upon giving at least ninety (90) days prior
            written notice to StarTek USA, Inc., or (ii) by agreement of the
            Parties.

      3.3.  Termination for Breach or Force Majeure. Either Party may terminate
            this Agreement immediately upon notice to the other Party (i) if the
            other Party materially breaches this Agreement and fails to cure
            such breach within [**] days of receipt of written notice of such
            breach from the non-breaching Party; (ii) if the other Party becomes
            insolvent, invokes as a debtor any laws relating to the relief of
            debtors from creditor's rights, or has such laws invoked against it,
            is the subject of liquidation or termination of business, is
            adjudicated bankrupt, or is involved in an assignment for the
            benefit of its creditors; or (iii) upon the

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            occurrence and after continuance of an event of force majeure for a
            period of [**], or in other circumstances, as provided in Exhibits A
            - 1 through A - 6.

      3.4.  Effect of Termination. The expiration or termination of this
            Agreement shall not relieve or discharge either Party from any
            obligation hereunder, which survives termination. Except in the
            event of termination of this Agreement by StarTek USA, Inc. as a
            result of the failure of T-Mobile USA to pay undisputed invoices for
            Services performed by StarTek USA, Inc. , in the event of any
            termination, StarTek USA, Inc. agrees to cooperate with T-Mobile USA
            to effectuate an orderly transition of the business and will
            continue to provide Services hereunder at the prices provided in
            Exhibits A - 1 through A - 6 pursuant to a schedule mutually
            agreeable to the parties (which may include a schedule for ramping
            down services) for a reasonable period of time not to exceed [**]
            from the date of termination. In the event any transition service is
            not provided for in Exhibits A - 1 through A - 6, T-Mobile USA shall
            pay a mutually agreed upon cost to StarTek USA, Inc. for those
            transition services.

      3.5.  Termination of Prior Agreement. Effective upon execution of this
            Agreement, the Amended and Restated Services Agreement, dated April
            1, 2002, between the parties including the Exhibits with Statements
            of Work for Standard [**], Advanced [**], Offline, and Prepay
            services shall be considered terminated by mutual agreement of the
            parties.

4.    REPRESENTATIONS AND WARRANTIES.

      4.1.  SERVICE PARTNER. StarTek USA, Inc. hereby represents and warrants to
            T-Mobile USA as follows:

            4.1.1. StarTek USA, Inc. is financially solvent, able to pay its
                  debts and possesses sufficient working capital to provide and
                  complete the Services in accordance with this Agreement.

            4.1.2. StarTek USA, Inc. has the experience and skills necessary to
                  perform and provide the Services required under this
                  Agreement. All Services provided by StarTek USA, Inc. shall be
                  performed (i) in a professional manner, commensurate with that
                  which is customary in the industry, (ii) in compliance with
                  all applicable federal, state and local laws, rules,
                  regulations and ordinances and (iii) in compliance with
                  T-Mobile USA's applicable written policies which have been or
                  will be provided to StarTek USA, Inc. not less than thirty
                  (30) days prior to the effectiveness of such written policies.

            4.1.3. All information supplied by or on behalf of StarTek USA, Inc.
                  shall be accurate and complete in all material respects.

            4.1.4. StarTek USA, Inc. is in compliance with all applicable
                  federal, state and local laws, rules, regulations and
                  ordinances relating to the Services to be performed by StarTek
                  USA, Inc. for the benefit of T-Mobile USA hereunder. StarTek
                  USA, Inc. entering into and performing its obligations
                  pursuant to this Agreement will not violate any agreement
                  between StarTek USA, Inc. and any third party.

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5.    LIABILITY PROVISIONS.

      5.1.  Indemnification; Limitations on Liability.

            5.1.1. StarTek USA, Inc. Obligations. StarTek USA, Inc. shall
                  indemnify and hold T-Mobile USA harmless from and against any
                  and all claims, liabilities, losses, damages (including
                  reasonable attorneys' fees, costs and other litigation
                  expenses), and causes of action relating to (i) a material
                  breach of this Agreement by StarTek USA, Inc. or (ii) bodily
                  injury, death, or personal property damage proximately caused
                  by the negligence or willful misconduct of StarTek USA, Inc.
                  provided, however, SERVICE PARTNER shall not be responsible
                  for claims, liabilities, losses, damages, and causes of action
                  to the extent caused by the acts or omissions of T-Mobile USA.

            5.1.2. T-Mobile USA's Obligations. T-Mobile USA shall indemnify,
                  defend and hold StarTek USA, Inc. harmless from and against
                  any and all claims, liabilities, losses, damages (including
                  reasonable attorneys' fees, costs and other litigation
                  expenses), and causes of action relating to (i) a material
                  breach of this Agreement by T-Mobile USA or (ii) bodily
                  injury, death, or personal property damage proximately caused
                  by the negligence or willful misconduct of T-Mobile USA
                  provided, however, T-Mobile USA shall not be responsible for
                  claims, liabilities, losses, damages, and causes of action to
                  the extent caused by the acts or omissions of StarTek USA,
                  Inc..

            5.1.3. Procedure. Each Party's indemnification obligations hereunder
                  shall be subject to (a) receiving written notice of the
                  existence of any action, (b) permitting the indemnifying
                  party, at its option, to control the defense of such action,
                  (c) permitting the indemnified party to participate in the
                  defense of any action, (at the expense of the indemnifying
                  party) and (d) receiving reasonable cooperation of the
                  indemnified party in the defense thereof.

            5.1.4. Limitations. The indemnification rights of an indemnified
                  party hereunder shall be the exclusive monetary remedy of the
                  indemnified party with respect to the claims to which such
                  indemnification relates.

      5.2.  Limitation on Liability. StarTek USA, Inc. SHALL NOT BE LIABLE TO
            T-MOBILE USA AND T-MOBILE USA SHALL NOT BE LIABLE TO STARTEK USA,
            INC. (REGARDLESS OF THE FORM OF ACTION OR THE CLAIM (E.G. CONTRACT,
            WARRANTY, TORT, MALPRACTICE, AND/OR OTHERWISE)) FOR INDIRECT,
            INCIDENTAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES OR FOR ANY LOSS OF
            REVENUE, LOST PROFITS, LOST BUSINESS OPPORTUNITIES, OR FOR ANY
            FAILURE TO REALIZE SAVINGS OR OTHER BENEFITS, EVEN IF ADVISED OF THE
            POSSIBILITY OF ANY OF THE FOREGOING; AND THE ENTIRE LIABILITY OF ONE
            PARTY TO THE OTHER PARTY UNDER OR IN RELATION TO THIS AGREEMENT FOR
            ANY LOSS OR DAMAGE, AND REGARDLESS OF THE FORM OF ACTION WILL BE
            LIMITED TO PROVEN, ACTUAL, OUT-OF-POCKET EXPENSES WHICH ARE
            REASONABLY INCURRED. THE AGGREGATE LIABILITY OF STARTEK USA, INC.
            AND T-MOBILE USA RELATING TO OR ARISING FROM THIS

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            AGREEMENT AND FOR ANY AND ALL CAUSES OF ACTION SHALL NOT EXCEED
            [**]. THIS SECTION SHALL NOT APPLY TO ANY TORT LIABILITY BASED ON
            NEGLIGENCE OR WILLFUL MISCONDUCT RESULTING IN PHYSICAL DAMAGE TO
            TANGIBLE PROPERTY OR PERSONAL INJURY OR DEATH OR FOR A BREACH OF THE
            CONFIDENTIALITY REQUIREMENTS HEREUNDER OR LIABILITY UNDER SECTION
            6.4. THIS AGREEMENT, AND THIS SECTION IN PARTICULAR, DEFINES A
            MUTUALLY AGREED UPON ALLOCATION OF RISK, AND THE FEES AND OTHER
            CONSIDERATION HAVE BEEN SET TO REFLECT SUCH ALLOCATION.

6.    INTELLECTUAL PROPERTY/CONFIDENTIALITY.

      6.1.  Ownership of Materials. Each Party retains any and all rights to its
            own previously existing information, software and/or developments
            and to its own information, software and/or developments that are
            created separately from and independent of its activities under the
            Agreement. Except as specifically set forth in this Agreement,
            neither Party obtains rights to information provided by the other
            solely by its access to or use of the information in performing its
            obligations or exercising its rights hereunder.

      6.2.  Data. As between T-Mobile USA and StarTek USA, Inc., T-Mobile USA
            will own exclusively all data received or collected by StarTek USA,
            Inc. as a direct result of the Services provided hereunder. StarTek
            USA, Inc. shall return all such data upon written request of
            T-Mobile USA.

      6.3.  No License. Except as otherwise provided in Exhibits A - 1 through A
            - 6, neither Party is granted any license in intellectual property
            that is owned or developed by the other Party.

      6.4.  Confidentiality. The Parties acknowledge that each may be given
            access to certain confidential or secret information and material
            relating to or owned by the other, including but not limited to
            financial information, customer lists, information pertaining to
            T-Mobile USA or StarTek USA, Inc. customers, files and other
            information regarding that Party's business, organization,
            operations, and plans in the course of the performance under the
            Agreement. Such information and material shall be the sole and
            exclusive property of the provider of such information, and each
            Party agrees that during the term of the Agreement and for five (5)
            years thereafter (and with respect to trade secrets, indefinitely),
            the receiving Party will not disclose such confidential or secret
            information or material, or the terms of the Agreement, to any
            governmental agency, person, entity, firm, or corporation, or use
            confidential or secret information or material except in furtherance
            of the Agreement, without the express prior written consent of the
            other Party. This section shall not apply to any information (a)
            previously known to the receiving Party free of any obligation to
            keep it confidential, (b) that has been or which becomes publicly
            known through no wrongful act of the receiving Party, (c) which is
            rightfully received from a third party who is under no obligation of
            confidence to either Party, (d) which is independently developed by
            the receiving Party without resort to information which has been
            disclosed

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            pursuant to the Agreement or (e) is required to be disclosed in
            order to comply with applicable laws (including state and federal
            securities laws applicable to StarTek USA, Inc. as a public company)
            or administrative process or any governmental or court order;
            provided, however, that in a circumstance where disclosure is
            compelled by governmental or court order the Party that is subject
            to such compelled disclosure shall give the other Party prompt prior
            notice of such compelled disclosure so that the other Party may seek
            to protect such information. The receiving Party shall return the
            confidential information to the disclosing Party upon request by the
            disclosing Party. This Section shall survive termination of the
            Agreement.

7.    GENERAL PROVISIONS.

      7.1.  Entire Agreement. This Agreement, including all exhibits, which are
            incorporated herein by this reference, contains the entire
            understanding of the Parties with respect to the subject matter
            hereof, and supersedes all prior agreements and understandings
            between the Parties.

      7.2.  Assignment. StarTek USA, Inc. acknowledges that the Services to be
            rendered by StarTek USA, Inc. are unique and personal. Accordingly,
            StarTek USA, Inc. may not assign any of StarTek USA, Inc.'s rights,
            including the right to receive payments, or delegate any of StarTek
            USA, Inc.'s duties or obligations under this Agreement without the
            prior written consent of T-Mobile USA. T-Mobile USA may assign its
            rights hereunder upon its sole discretion, subject to StarTek USA,
            Inc.'s verification of assignee's ability to fulfill the financial
            obligations under this Agreement. This Agreement shall inure to the
            benefit of and shall be binding upon the permitted successors and
            assigns of the Parties.

      7.3.  Publicity. Except as required by law, including state and federal
            securities laws applicable to StarTek USA, Inc. as a public company,
            SERVICE PARTNER will limit disclosure to their Board and investors
            of the existence of this Agreement and will not make any disclosure
            to any third party concerning its business relationship with
            T-Mobile USA, including any press releases, without the prior
            written approval of T-Mobile USA.

      7.4.  Governing Law. This Agreement shall be governed by and construed
            according to the laws of the State of Washington, without regard to
            the conflict of laws or choice of law provisions thereof.

      7.5.  Construction. This Agreement, together with all Exhibits hereto,
            represents the wording selected by the Parties to define their
            agreement and no rule of strict construction shall apply against
            either Party. This Agreement is written in, and shall be governed
            by, the English language. This Agreement may be translated into one
            or more languages, provided, however, in the event of any conflict
            in interpretation between this Agreement and any foreign language
            translation, the interpretation of this English version of the
            Agreement shall prevail. This Agreement (a) represents the entire
            agreement between the Parties relating to the subject matter of this
            Agreement, (b) supersedes and terminates all prior purchase orders,
            agreements, understandings, representations, and warranties
            applicable to the subject matter of this Agreement, and (c) may only
            be amended

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            or modified by a writing signed by both Parties by their duly
            authorized representatives (which in the case of T-Mobile USA shall
            be a Vice President or higher). Any waiver pursuant to this
            Agreement must be in writing and any waiver of one event shall not
            be construed as a waiver of subsequent events. Headings used in this
            Agreement are for reference only and shall not be deemed a part of
            this Agreement.

      7.6.  Relationship. The Parties acknowledge and agree that their
            relationship shall be solely and exclusively that of independent
            contractors, and that in no event shall either Party be, claim to
            be, or be deemed to be an employee, agent, or partner of the other
            Party by reason of or with respect to this Agreement or any Services
            provided pursuant to this Agreement. Without limiting the generality
            of the foregoing, each Party agrees (a) to conduct itself strictly
            as an independent contractor pursuant to this Agreement, and (b) to
            comply with all applicable laws, rules and regulations, including
            without limitation all laws, rules and regulations governing payment
            of federal and state income taxes, self-employment taxes, estimated
            taxes, sales, use and service taxes, and all other federal, state,
            local and foreign taxes of any nature imposed with respect to any
            obligations pursuant to this Agreement or payments therefore.
            T-Mobile USA shall have the right to request StarTek USA, Inc. to
            remove any personnel from the T-Mobile USA account who has engaged
            in poor performance, fraud or breach of this Agreement.

      7.7.  Non-Solicitation. Without the prior written consent of the other
            Party, during the term of this Agreement and continuing through the
            first anniversary of the termination of this Agreement, neither
            Party shall, and shall ensure that its affiliates do not, directly
            or indirectly, solicit or attempt to solicit for employment any
            persons employed by the other Party who are directly involved in
            carrying out the obligations of the Parties pursuant to this
            Agreement.

      7.8.  Notice. Any notice or communication required or permitted to be
            given hereunder (other than forecasts required to be delivered
            pursuant Exhibits A- 1 through A- 6) shall be in writing and may be
            delivered by hand, deposited with an overnight courier, sent by
            email, confirmed facsimile (followed by delivery of a copy by US
            Mail), or mailed by registered or certified mail, return receipt
            requested, postage prepaid, in each case to the address of the
            receiving Party as set forth in this section. Such notice shall be
            deemed to have been given as of the date it is delivered, mailed,
            emailed, faxed or sent, whichever is earlier.

                  To: T-Mobile USA

                  Dave Miller
                  Sr. Vice President and General Counsel
                  To T-Mobile USA
                  12920 SE 38th Street
                  Bellevue, WA 98006

                  To: StarTek USA, Inc.

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                  Steve Butler
                  CEO
                  StarTek USA, Inc.
                  100 Garfield Street
                  Denver, Colorado 80206

      7.9.  Severability. If any term or provision of this Agreement or the
            application thereof to any person or circumstance, at any time or to
            any extent, is held invalid, illegal, or unenforceable by a court of
            competent jurisdiction by reason of any rule of law or public
            policy, all other conditions and provisions of this Agreement shall
            remain in full force and effect so long as the economic or legal
            substance of the transaction contemplated hereby is not affected in
            any manner materially adverse to either Party. Upon such
            determination that any term or other provision is invalid, illegal,
            or incapable of being enforced, the Parties hereto shall negotiate
            in good faith to modify this Agreement so as to effect the original
            intent of the Parties as closely as possible in an acceptable manner
            to the end that the transaction contemplated hereby is fulfilled to
            the maximum extent possible.

      7.10. DOJ Agreement. T-Mobile USA has entered into an agreement with the
            Federal Bureau of Investigation and the Department of Justice that
            requires parties contracting with T-Mobile USA to comply with
            applicable terms. StarTek USA, Inc. agrees as follows:

            7.10.1. StarTek USA, Inc. shall not throughout the term of this
                  Agreement or at any time thereafter store subscriber audio or
                  data communications occurring in the U.S., or any other
                  subscriber information, including, without limitation, call
                  transactional data, call associated data, call identifying
                  data, subscriber information and subscriber billing records
                  (collectively, "Subscriber Information") outside of the United
                  States without T-Mobile USA 's prior written consent, which
                  may be withheld for no reason, or any reason, in T-Mobile
                  USA's sole discretion; provided, however, that T-Mobile USA
                  understands that StarTek USA, Inc. will be providing the
                  Services in [**], and as a result, T-Mobile USA hereby
                  consents to the storage by StarTek USA, Inc. of all Subscriber
                  Information necessary to perform the Services under this
                  Agreement in [**] for the term of this Agreement.

            7.10.2. StarTek USA, Inc. will provide T-Mobile USA within at least
                  thirty (30) days prior written notice of its desire to store
                  Subscriber Information in another location different from [**]
                  including description of the communications and/or
                  information, identification of the custodian, identification
                  of the proposed location where the communications and/or
                  information would be stored; and identification of the factors
                  it considered in seeking to store the communications and/or
                  information outside [**].

            7.10.3. StarTek USA, Inc. will store billing records relating to
                  T-Mobile USA subscribers for a minimum period of two years;

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            7.10.4. StarTek USA, Inc. will store Subscriber Information in its
                  possession, custody and control if requested by a domestic
                  governmental entity pursuant to 18 U.S.C. Section 2703(f);

            7.10.5. StarTek USA, Inc. will store Subscriber Information in a
                  manner such that the communications and/or information do not
                  become subject to mandatory destruction under any foreign
                  laws;

            7.10.6. StarTek USA, Inc. will make available in the United States
                  all Subscriber Information that is stored by StarTek USA, Inc.
                  or a third party (as permitted under this Agreement);

            7.10.7. StarTek USA, Inc. will not disclose Subscriber Information
                  to any foreign government or entity without first (i)
                  satisfying all applicable U.S. federal, state and local legal
                  requirements, including receiving appropriate authorization by
                  a domestic U.S. court, or receiving prior written
                  authorization from the U.S. Department of Justice, and (ii)
                  notifying T-Mobile USA of the request for such information
                  within five (5) days of its receipt;

            7.10.8. StarTek USA, Inc. will protect the confidentiality and
                  security of all lawful U.S. process and the confidentiality
                  and security of Classified Information and Sensitive
                  Information in accordance with federal and state laws and
                  regulations.

      7.11. System Security. StarTek USA, Inc. warrants that it has taken such
            precautions as are necessary to ensure that its computer and
            electronic systems are secure from breach or intrusion by
            unauthorized third parties. In the event that a StarTek USA, Inc.
            system is breached and an unauthorized third party has access to or
            has viewed the information of T-Mobile USA or T-Mobile USA customers
            then StarTek USA, Inc. shall notify T-Mobile USA promptly of such
            breach and shall take such actions as may be necessary to prevent
            such breaches from occurring in the future.

Executed as of the Effective Date:

StarTek USA, Inc.                          T-Mobile  USA, Inc.

By: ________________________________       By: ________________________________

____________________________________       ____________________________________
Name and Title                             Name and Title

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                                   EXHIBIT A-1

                            STATEMENT OF WORK - [**]

This Statement of Work, Exhibit A-1 is incorporated into that certain T-Mobile
USA Service Partner Services Agreement ("Agreement") dated August 1, 2005 by and
between T-Mobile USA, Inc. ("T-Mobile") and StarTek USA, Inc. ("StarTek"). The
Statement of Work shall be effective as of August 1, 2005 and the defined terms
used in this Statement of Work shall have the meanings provided in the Agreement
unless expressly defined herein.

1.    GENERAL. StarTek will handle inbound [**] calls for T-Mobile. StarTek will
      maintain a dedicated program (i.e., StarTek's dedicated representatives
      shall handle only T-Mobile calls, StarTek's team supervisors shall support
      only T-Mobile dedicated representatives and StarTek's team managers will
      support only T-Mobile dedicated team supervisors.) to perform the
      Services.

2.    HOURS OF OPERATION. Except as otherwise set forth herein, the hours of
      operation will be [**]. Any change to the hours of operation on a T-Mobile
      line of business at any site by StarTek requires written request and
      approval by a T-Mobile Vice President of the change. Any change to the
      hours of operation on a T-Mobile line of business at any site by T-Mobile
      requires written notification to StarTek. Any closure of a site or 100%
      reallocation of headcount to another site in which a T-Mobile line of
      business resides requires written notice to T-Mobile of [**] in advance of
      the closure or reallocation. Any reallocation of headcount (not due to
      forecast change) to another site of [**] of the total [**] headcount
      requires written notice to T-Mobile of [**] in advance of the
      reallocation. StarTek will provide a comprehensive written plan as to how
      StarTek will maintain services for the line of business to mitigate impact
      and prevent tangible and intangible cost to T-Mobile.

3.    CALL VOLUME AND FORECASTING.

      3.1.  For the purposes of meeting the forecast, StarTek will utilize full
            time equivalents ("FTEs") in accordance with this Statement of Work.
            An FTE is defined as [**] Customer Facing Employee [**]. An FTE is
            not equivalent to headcount.

      3.2.  FTEs will be classified into the following categories:

            3.2.1. Production FTE, which includes FTEs who are agents productive
                  to the line of business.

            3.2.2. Training FTE, which includes FTEs who are currently in
                  training and not productive to the line of business.

            3.2.3. GMA FTE, which includes FTEs who are productive to the line
                  of business at least part of their day, but are still in
                  training.

            3.2.4. LOA FTE, which includes all FTEs who cannot be classified
                  into Production, Training, or GMA.

      3.3.  T-Mobile will regularly prepare and deliver to StarTek the following
            forecasts for the services to support the proper planning of the
            infrastructure required to support the programs:

            3.3.1. T-Mobile shall deliver a [**] rolling informational forecast
                  to StarTek on or before the 15th day of each month [**], which
                  shall contain forecasted[**] call volumes.

            3.3.2. T-Mobile shall deliver a final forecast to StarTek no less
                  than 45 days before the 1st day of each [**] for which the
                  forecast is made, which shall contain a [**] call volume and
                  Average Handle Time ("AHT") forecast by [**] interval (the
                  "Final Forecast"). The Final Forecast will contain an updated
                  [**] call volume and AHT forecasts, which will vary no more
                  than [**] in call volume each day from the [**] forecast. If
                  the Final Forecast is not delivered in a timely fashion with
                  respect to a particular month, the appropriate [**] rolling
                  informational forecast shall be the Final Forecast for such
                  [**].

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            3.3.3. For informational purposes only, T-Mobile shall deliver a
                  [**] forecast.

      3.4.  StarTek will use [**] call volume forecasts provided by T-Mobile as
            the Final Forecast in accordance with this Agreement. This process
            is known as Interval Forecasting. StarTek will schedule the
            appropriate number of FTEs in [**] intervals to meet the service
            levels called for in the T-Mobile Final Forecast. This process is
            known as Interval Scheduling. StarTek will provide Interval
            Scheduling plans to T-Mobile [**] in advance after receiving a Final
            Forecast from T-Mobile. These Interval Scheduling plans will
            illustrate how StarTek plans to meet the Key Performance Indicator
            ("KPI") Service Level. The documented plans will include the number
            of required FTEs to meet the KPI Service Level, the number of
            scheduled agents, and the [**] Service Level Objectives.

      3.5.  StarTek will provide to T-Mobile all assumptions used to translate
            forecasts into scheduled FTEs.

      3.6.  T-Mobile and StarTek will cooperatively manage [**] schedule
            adjustments to manage actual call volumes.

      3.7.  T-Mobile and StarTek will mutually agree upon and participate in the
            preparation of other call volume forecasts, as reasonably required
            for the successful performance of the Programs. These may include,
            without limitation, [**]. As part of the support structure, StarTek
            will provide a National Resource Planning Analyst who will, among
            other things, assist T-Mobile in the development of call volume
            forecasts.

      3.8.  StarTek will recruit, train, and staff to a minimum of [**] of the
            forecasted FTEs and be able to handle [**] of the forecasted call
            volume. If the Final Forecast for a particular [**] is [** ] or more
            of the Final Forecast for the proceeding [**], StarTek may add
            additional staff to service such increase with the prior consent of
            T-Mobile, which consent shall not be unreasonably withheld.

      3.9.  If the Production FTE count falls [**] below the forecasted FTE,
            StarTek will recruit and hire agents to back-fill the attrition as
            long as T-Mobile is delivering a minimum of [**] of forecasted
            volume. The recruited agents must start training within [**] days of
            exceeding threshold. [**].

      3.10.If the FTE requirement drops [**] T-Mobile will work with StarTek in
            good faith to back-fill with additional business [**] as StarTek
            ramps down to the required FTEs. [**] the number of FTEs that will
            be included in the ramp down.

      3.11.The forecasts referred to above shall in no way represent a
            commitment from T-Mobile to provide volumes to StarTek, except for
            purposes of amounts payable by T-Mobile to StarTek as provided in
            this Section 3.12.

      3.12.Amounts payable to StarTek hereunder and the KPI calculation shall be
            based upon the following:

            3.12.1. When the [**] exceeds [**] of Final Forecast then StarTek
                  shall be paid for the actual handled minutes.

            3.12.2. When the [**] is less than [**] of the Final Forecasted call
                  volume, and StarTek is staffed at no less than [**] of Final
                  Forecasted required FTE, then StarTek shall be paid according
                  to the following formula: [**].

4.    AVERAGE HANDLE TIME. AHT is defined as the sum of average talk time; hold
      time while on a call, and after call work. StarTek agrees that the AHT
      objectives shall be [**] for English [**]. The AHT objective shall be less
      than or equal to a [**] for Spanish [**]. The AHT objectives may be
      changed upon mutual agreement of StarTek and T-Mobile based on rolling
      [**] trending results.

5.    RAMP. Ramp is defined as any required FTE increase necessary to
      accommodate call volume growth of greater than [**] of the call volume
      during the peak [**] of the prior [**].

6.    RAMP PLANS. For the purposes of this document a Ramp Plan is defined as a
      T-Mobile approved plan to add substantial FTEs to a current line of
      business or a

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      change to the current line of business with substantial additions to
      current StarTek FTEs that support T-Mobile services. StarTek must submit
      written Ramp Plans to T-Mobile for written approval by a T-Mobile
      operations manager or above.

      6.1.  In the event of a new ramp plan or a change to the [**] line of
            business supported by StarTek, the AHT monthly objectives will be
            adjusted depending upon the percentage of net growth training FTE
            graduates to the maximum headcount during the growth period. The
            attached worksheet is an example of the adjustments and will be
            subject to the AHT objectives agreed to as set forth in Section 4

7.    TRAINING.

      7.1.  Agents will be trained on the standard T-Mobile New Hire Training
            Curriculum. Training for the program shall be conducted in
            accordance with the T-Mobile New Hire Training Curriculum. Upon [**]
            written notice to StarTek, T-Mobile may change the T-Mobile New Hire
            Training Curriculum and the hours required for delivery. Prior to
            completion of training, T-Mobile will deliver all applicable
            application IDs. Sharing of application IDs is prohibited under
            T-Mobile policy. StarTek will establish procedures to prevent
            sharing of application IDs. Any agent who violates this policy will
            be promptly removed from the T-Mobile account.

      7.2.  Any new hire training conducted for net growth must be approved in
            writing by a T-Mobile training manager or above. Written approval
            must be attached to the invoice in order to substantiate billable
            new hire training. T-Mobile will be kept informed of all attrition
            training.

      7.3.  The ratio of trainers to trainees is not to exceed a classroom level
            of [**]. The two trainers can include a fully certified trainer with
            the support of a supervisor who has been through a certified
            training course.

      7.4.  All costs and expenses for training and training materials for new
            agents and any initial and program extension training, or changes or
            modifications to the program or continuation training that exceeds
            [**] shall be borne by [**]. Online options must be used in lieu of
            printed materials wherever reasonably available. All written
            materials must be reused where reasonable. [**] will not reimburse
            [**] for training or training materials utilized for
            attrition-related training. [**] shall not compensate [**] for any
            agent who does not complete the training and graduate from [**].
            Documented training trackers must accompany all invoices for
            approval of billed charges. Documentation must contain as much
            information as allowed by law. Information required includes by is
            not limited to: Agent name, agent training start date, attendance
            record, and assessment and quality scores. All Continuing Education
            classes are to be tracked via an auxiliary (AUX) or automatic call
            distributor (ACD) code and submitted monthly with reporting
            displaying agent's name, the exact amount of time spent in each
            training course, the name of each training course, and the total
            time in the month spent in Continuing Education training. It is
            StarTek's responsibility to deliver all appropriate training within
            the scheduled time frame, subject to service level considerations.

      7.5.  StarTek will schedule StreamLine read time not to exceed the amount
            of six (6) minutes per day, and no more than thirty (30) minutes per
            agent per week. Streamline read time must be measured via ACD or AUX
            code, or skillset, and reported monthly. Streamline read time will
            be billed at the hourly continuing education training rate and is
            subject to the [**] StarTek is responsible for as referenced in
            Section 7.4.

      7.6.  StarTek must not graduate any new hire agent from training/GMA to
            production if the agent has missed more than 8 hours in the training
            classroom or 16 hours in GMA. The agent must return to the classroom
            or GMA as applicable to make up missed time before graduating to
            production. T-Mobile must receive written documentation of the
            missed time and proof that the time has been made up before being
            considered ready for production. New agents

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            must also pass training assessments at 85% or better and score 2.6
            or higher in quality during GMA to graduate from training to
            production.

      7.7.  [**] requests for removal of personnel including, but not limited
            to, new trainers and any associated materials, [**].

      7.8.  If StarTek is not meeting the quality standards set forth in Section
            0 below and it is determined by T-Mobile that additional "skill set"
            training is required for StarTek representatives, [**] will bear the
            cost of the additional training.

      7.9.  T-Mobile curriculum is to be facilitated by Certified Facilitators.
            If StarTek does not have a certification course they will be
            required to use the T-Mobile certification course. Facilitators are
            required to be certified by either T-Mobile Learning and Development
            specialist or their own Certified Training Manager. Uncertified
            Supervisors/Operations Managers/Coaches or Team Leads cannot conduct
            New Hire Training.

      7.10.StarTek will abide by the documented training guidelines. Any changes
            to the documented training guidelines by T-Mobile must be provided
            to StarTek no less than [**] prior to implementation. Any changes
            materially impacting StarTek cost must be agreed to by both parties.

8.    ESCALATION PROCEDURES. StarTek shall utilize T-Mobile-provided escalation
      processes, to handle calls beyond the agent's scope of training or for
      management support of a customer issue. This process will ensure that each
      call that cannot be handled by the agent is then handled by the lead
      representative up through the manager before being transferred to T-Mobile
      for resolution. If a customer requires management support, the agent shall
      transfer the call to a manager. T-Mobile shall update all on-line job
      aides that define the escalation procedures for the program when any
      changes are made.

9.    [**]

      9.1.  [**]

      CUSTOMER CARE SYSTEMS. StarTek shall be responsible for costs associated
with workstations and local area networks (LAN) infrastructure equipped to run
the most recent version of the [**] deployed at the time of the implementation
of this Agreement. StarTek is hereby granted a license for the term of this
Agreement to use the [**] for the sole purposes of performing its obligations
under this Agreement. StarTek shall also provide the building, and
telecommunications switch for the Interactive Voice Response (IVR) system,
remote monitoring application and associated toll free number, Universal Power
Supply (UPS), desktop computers, office supplies, and dedicated workspaces in
each call center. [**] shall be responsible for costs associated with wide area
network (WAN) infrastructure, including, but not limited to, the WAN data
connectivity infrastructure, application/database servers, routers, and related
peripherals. [**] shall also be responsible for software required to support the
[**]. T-Mobile will be responsible for the [**], Knowledge Database, and Call
Tracking systems required to support the Services performed under this
Agreement.

      SYSTEMS USE AND DOWNTIME. Information given to callers or collected by
agents will be directly taken from and/or input into T-Mobile's systems. In the
event that T-Mobile's systems go down, StarTek shall capture call information in
Remedy, or on the downtime forms provided by T-Mobile. StarTek will be
instructed on procedures in each scenario as applicable by T-Mobile. If paper
forms are utilized, StarTek agrees that it shall then input information from
these downtime forms once the system is restored. Turnaround commitment to enter
downtime forms into T-Mobile's systems will be [**] from the time when
T-Mobile's systems are restored. If call volume does not allow for [**]
turnaround due to call volume meeting at least [**] of the forecasted volume,
another [**] input period shall be granted. Downtime forms will be destroyed
(shredded or burned) or sent to T-Mobile, as directed by T-Mobile, every [**].
StarTek will assign a special ACD tracking code to designate when specified
representatives are entering downtime form information into T-Mobile systems.
StarTek shall provide a downtime productivity reports to T-Mobile displaying
time in code, number of downtime forms processed and occupancy rate. T-Mobile
agrees to pay StarTek [**] (contingent upon meeting [**] per agent to be agreed
upon by both parties) for entering downtime

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information as stated in the Pricing Schedule set forth in Section 24 of this
Statement of Work.

10    OVERTIME.

      If the call volume exceeds the Final Forecast by more than [**], StarTek
      will so notify T-Mobile and will recruit trained agents to work overtime
      to support the call handling. Any overtime in excess of [**] of Final
      Forecasted volume must be authorized by T-Mobile operations manager or
      above. For T-Mobile authorized overtime T-Mobile will pay the overtime
      rate set forth in Section 0 for all volume handled in excess of [**] of
      the Final Forecast. The billable overtime minutes will be calculated as
      set forth in Section 0.

      The recruiting process for overtime shall be deployed as soon as the
      circumstance affecting the call volume variance is identified. If StarTek
      identifies the item at least [**] before the occurrence, StarTek shall use
      its commercially reasonable efforts to minimize the financial impact by
      changing schedules to support the staffing required. StarTek shall also
      recruit agents to work overtime on a [**] basis when the [**] call volume
      dictates additional staffing needs to maintain service goals.

      Except as provided above in Section 12.2, StarTek shall obtain written
      authorization from T-Mobile for any overtime that may be required or
      incurred for the performance of the Programs.

      T-Mobile authorized overtime as defined in section 0 will be calculated
      for purposed of invoice payment by multiplying the handled call volume in
      excess of [**] of Final Forecast by the [**], and dividing through by 60
      to get minutes.

SIGNIFICANT CHANGES. When significant changes occur to the processes utilized to
provide services, T-Mobile has the right to request information related to
compliance and execution of such changes.

      KPIS.The KPIs for Services performed hereunder shall be effective for
         purposes of bonus/penalty adjustments to the invoice, as set forth
         in Exhibit B. Service Level. Inbound [**] customer service calls: [**].

      Call Volume. [**].

      Call Quality. According to the results from the call quality observation
      process, as described below, with a minimum score of [**].

            For the purposes of ensuring Call Quality, StarTek and T-Mobile
            shall measure the agents' call quality using the following types of
            observations:

                  1.    T-Mobile observation;

                  2.    StarTek operations observation (4 per agent/month);

                  3.    StarTek quality observation (4 per agent/month)

            KPI performance is based upon T-Mobile scores only, whereas the
            function of the StarTek operations and quality observations is to
            provide immediate and monthly feedback to agents and StarTek
            management.

            For the purposes of billing, the scores for all of these
            observations will be [**]. The StarTek operations and StarTek
            quality observations must each be [**] If either the StarTek
            operations or the StarTek quality observation [**] not [**].
            T-Mobile may provide written approval of exception to this section 0
            given the number of outsourced issue tickets on T-Mobile
            observations.

            Calibration. StarTek operations managers shall attend the monthly
            T-Mobile calibration sessions for the line of business.

            The call quality observation form to be used in this process shall
            be provided by T-Mobile. Results shall be used to provide both
            immediate and monthly feedback to agents and StarTek management.
            StarTek will make best effort to provide each agent

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            with feedback/coaching within 24 hours of being monitored by
            T-Mobile, StarTek quality team or StarTek operations. StarTek shall
            keep written documentation of each agent session, signed by the
            agent, and available for review by T-Mobile upon request. The call
            quality scoring criteria used by StarTek will match that used by
            T-Mobile. StarTek must achieve a minimum voice quality score [**].
            Call monitoring feedback sessions will be held between the agent and
            the agent's direct supervisor. Any monitored calls using profanity
            or customer abuse as determined by T-Mobile will result in
            immediate, unchallenged agent termination from the T-Mobile program.

      Data Accuracy: StarTek must maintain a [**]. Data accuracy will be
      calculated by dividing the total number of erroneous [**] by the total
      number of [**] audited.

REPORTS. StarTek shall provide T-Mobile with standard call count reports and
performance reports on a [**] basis [**] by [**] for the previous [**] by [**]
for the previous [**], and [**] by [**] for the previous [**]. The reports shall
be in the format and contain the information mutually agreed upon between
StarTek and T-Mobile. StarTek shall provide report cards reflecting measurements
of the KPIs and all of the above metrics within [**] of each [**]. All reporting
fed by data from the switch is considered standard and is not subject to
non-standard report development costs. Hourly lines of business must have agent
detail payroll reports to substantiate that billable hours do not exceed actual
hours worked. T-Mobile and StarTek shall mutually agree upon any other reports
and the cost associated with the development of those reports. T-Mobile agrees
to follow the change management process defined by StarTek and agreed to by
T-Mobile when requesting changes to reports or additional information. If
T-Mobile requires material format changes to T-Mobile standard reports, T-Mobile
will be required to compensate StarTek for the development costs, based upon the
rate outlined in the Pricing Schedule set forth in Section 0 of this Statement
of Work and will be [**] prior to invoicing.

MONITORING. T-Mobile shall have the right, to the extent permitted by law and at
no additional expense, to monitor at any time (either on-site or remotely)
customer contact calls and/or specific agents to ensure compliance with
performance, operational and quality control standards. [**] must provide [**]
with a remote monitoring solution. There are two quality monitoring options
required: a [**] and a [**]. [**] would manage the [**] calls within [**] of
being [**]. [**] requires a minimum of [**] calls per agent per month [**]. [**]
must have the ability to monitor random calls as they come into the queue, or by
locating specific agents [**].

A.    HOLIDAYS. StarTek shall observe the following holiday schedule [**].
      T-Mobile shall compensate StarTek for holiday rates as identified in the
      Pricing Schedule set forth hereunder when applicable to the location where
      work is performed. Holiday rates apply to the actual holiday only.

            [**]                                    US HOLIDAYS
            [**]                              New Year's Day (Jan 1)
            [**]                         Memorial Day (last Monday in May)
            [**]                              Fourth of July (July 4)
            [**]                       Labor Day (first Monday in September)
            [**]                    Thanksgiving Day (4th Thursday in November)
            [**]                              Christmas (December 25)

SYSTEM DOWNTIME; FORCE MAJEURE.

         In the event StarTek determines that system maintenance is necessary,
         StarTek will notify T-Mobile of the need for such maintenance [**]
         prior to the maintenance, and will obtain the prior written approval of
         T-Mobile to schedule the time and duration of such maintenance. All
         routine maintenance shall be scheduled during off-peak system hours. In
         no event shall interruption of Services for disclosed and approved
         system maintenance constitute a failure of performance by StarTek if
         performed

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         in accordance with this Section 17. StarTek shall promptly report to
         T-Mobile any StarTek system failures, including information on the
         duration and impact.

         Except for T-Mobile's obligation to make payments for services actually
         performed, each Party's failure to perform shall be excused where such
         failure is a result of causes beyond its reasonable control. Such
         causes shall include without limitation acts of God, strikes, lockouts,
         riots, acts of war, epidemics, governmental regulations imposed after
         the fact, fire, communication line failures of third parties,
         vandalism, power failures by third parties, cables cut by third
         parties, earthquakes, floods or other similar catastrophes, terrorist
         activities, failure of the T-Mobile system or the Internet not related
         to StarTek's actions or inactions, any law, order, regulation,
         direction, action or request of any governmental entity or court or
         civil or military authority having jurisdiction over either of the
         parties, national emergencies, insurrections, riots, wars, strikes,
         lock outs, or work stoppages. In the event of failures to perform for
         [**] or more as a result of a force majeure, either Party may terminate
         the Agreement by giving written notice to the other Party. Any such
         notice of termination shall be effective upon receipt.

         Notwithstanding the foregoing or anything in the Agreement to the
         contrary, StarTek shall take commercially reasonable steps to ensure
         that the Services shall continue without interruption due to StarTek
         systems failure during the term of the Agreement by implementing [**]
         reasonably necessary to provide the Services with an up-time of [**]
         (not including scheduled maintenance), which shall include [**] and the
         like. The components and execution of this plan must be reviewed,
         updated, and tested semi annually and results reported to T-Mobile.

         Where downtime is a result of [**].

         Where downtime is a result of [**].

ALLOCATION OF RESOURCES. T-Mobile acknowledges that upon the occurrence of a
force majeure event or in instances of unusually high demand, demands on
StarTek's facilities may exceed such facilities available capacity. In any such
instance, StarTek shall, upon written notice to T-Mobile, be entitled to
equitably prioritize Services and otherwise curtail utilization of its
facilities in a manner so that any degradation to the Services provided to
T-Mobile is (unless agreed otherwise by T-Mobile in writing) no greater than the
level of degradation experienced by StarTek's other customers. Upon the request
of T-Mobile, StarTek shall provide T-Mobile with reasonable evidence of its
compliance with the foregoing.

RECRUITING REQUIREMENTS. StarTek recruiting efforts shall meet the following
requirements in the selection process of all personnel hired to perform the
T-Mobile services as describe in this SOW,. T-Mobile reserves the right to audit
the selection process.

         A mutually approved customer service assessment

         A behavioral interview

         Background checks, which shall include criminal records, are required
         and shall be completed before employment. Costs incurred for background
         checks associated with such criminal records shall be StarTek's
         responsibility.

STAFFING REQUIREMENTS. StarTek agrees to maintain the following staffing ratios:
[**]. StarTek agrees that all managers shall be full-time StarTek employees.
Subject to Section 21.1, StarTek will ensure that each person assigned to a
function has the necessary functional and T-Mobile-related training to
successfully perform the function. StarTek must provide specific agent
information up to what the law allows. Information required includes agent name,
agent ID, start date on T-Mobile line of business, assessment scores,
termination date from T-Mobile line of business, quality average.

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All support functions such as StarTek quality, instructional analysts, and
trainers must be housed within the site where the work for this line of business
is being performed unless otherwise agreed to in writing by T-Mobile.

         In addition, before a function is performed by an individual assigned
         to that function, StarTek shall verify that the necessary skills have
         been attained through the use of certification of skills program. If
         T-Mobile reasonably requests StarTek to remove any personnel performing
         Services pursuant to this Agreement, StarTek shall promptly comply with
         such request, within [**]. In support of this process, StarTek will do
         the following:

               Team leaders/supervisors shall go on-line to support customer
               calls each week for at least [**] calls per day (approximately
               [**]) to maintain their skills. The remainder of their time shall
               be used to support agent development, and to otherwise assist
               StarTek employees to perform the Services.

               Quality Assurance specialists shall go on-line to support
               customer calls each [**] for at least [**] (approximately [**])
               to maintain their skills.

               Managers, lead representatives, team leaders/supervisors and
               trainers must be full-time employees of StarTek and must have
               completed T-Mobile National Standard Curriculum Training.

               Supervisors will monitor a minimum of two (2) calls per agent per
               week.

FRAUD. StarTek shall implement and enforce T-Mobile policies and procedures as
well as StarTek's own procedures to detect and prevent handset or credit card
theft or other fraudulent activity by an employee or agent of StarTek. StarTek
shall cooperate with any T-Mobile investigation into handset or credit care
theft or other fraudulent activity by an employee or agent of StarTek. If an
employee or agent of StarTek is suspected of committing handset or credit card
theft or other fraudulent activity against T-Mobile, StarTek will promptly
notify T-Mobile of the suspected fraudulent activity and will provide T-Mobile
with information necessary to conduct an investigation, including but not
limited to the employee name, address, contact information, social security
number, emergency contact address and phone numbers, and any other information
that will assist in investigation of the suspected fraudulent activity. This
information will be provided to T-Mobile within 48 hours of the request from
T-Mobile.

StarTek will assume all responsibility for handset theft, credit card theft or
other fraudulent activity by an employee or agent of StarTek or their failure to
follow T-Mobile policies and procedures. [**] to the following address:

      T-Mobile USA, Inc.
      Attn:  Kevin Golas, Sr. Manager of Investigations
      794 Roble Road
      Allentown, PA  18109

[**] shall be made to T-Mobile within [**] of the date the outsourced vendor
receives an [**].

T-Mobile reserves the right to prosecute any employee or agent of StarTek that
committed fraud against T-Mobile or a customer of T-Mobile.

BILLABLE MINUTES: For purposes of this Agreement, "Billable Minutes " is defined
as:

         [**] multiplied by the [**] when [**] is delivered to StarTek.

         In the event where less than [**] is delivered to StarTek, amounts
         payable to StarTek shall be based upon [**]

         During system downtime as a result of [**], amounts payable to StarTek
      shall be based upon the [**.] Where actual AHT is unavailable [**] the
      lesser of 100% [**] will be substituted

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         StarTek shall be paid an [**] as listed in Section 0 for the actual
         minutes of processing downtime forms as detailed in the required ACD
         productivity reports displaying time in code and number of forms
         processed. .

         During system downtime as a result of a StarTek failure outside the
         definitions provided for in Section6, and StarTek is unable to accept
         the call volume T-Mobile is otherwise prepared to provide it, for the
         purposes of determining KPI penalties, StarTek will use the forecasted
         volume to determine service levels for those downtime intervals.

         Overtime will be calculated by interval using the following formula:
         interval handled call volume in excess of [**] multiplied by the lesser
         of [**] of the KPI AHT and interval AHT, and divided through by 60 to
         obtain minutes. These are the billable overtime minutes where T-Mobile
         has solicited and provided written approval of overtime.

SERVICE LEVELS /BREACH OF SERVICE LEVELS. StarTek shall meet or exceed the Key
Performance Indicator Service Levels as provided in Performance Pricing Matrix
in Exhibit B. Performance outside of the neutral zone of the specified Key
Performance Indicators will result in increases/deductions to the overall price
per minute as provided in Exhibit B.

         In the event that StarTek negatively performs any of the Key
         Performance Indicators, in performance subject to deductions in
         payment/pricing (not neutral or bonus-able performance) as specified in
         Performance Price Matrix in Exhibit B, for a consecutive period of
         [**], StarTek shall be in breach of this Agreement. StarTek shall
         prepare a plan to cure the breach and shall have [**] from the date of
         the first date of failure in which to cure the breach. In the event
         that StarTek fails to cure the breach within the [**] period from the
         date of the first date of failure, T-Mobile may terminate the Agreement
         for StarTek's breach.

PRICING SCHEDULE. T-Mobile shall pay StarTek for Services as provided in the
following schedule.

         [Interim Pricing. Interim prices apply until such time StarTek meets a
         mutually agreed upon percent of call handled to forecast for [**] from
         effective date of this agreement; however no later [**]

               Standard Rate: [**]
               Holiday Rate: [**]
               Overtime Rate: [**]
               Spanish Standard Rate:[**]
               Spanish Holiday Rate: [**]
               Overtime Rate: [**]

         [Premium Pricing. Premium Pricing shall apply after StarTek performs as
         stated in Section 25.1 for [**]; however no later than [**].

               Standard Rate: [**]
               Holiday Rate: [**]
               Overtime Rate: [**]
               Spanish Standard Rate: [**]
               Spanish Holiday Rate: [**]
               Spanish Overtime Rate: [**]
         [**].
               [**]
               [**]
               [**]
               [**]
               [**]
               [**]
               [**]
               [**]

                                      [**]
                                    Exhibit B
                      ALL FIGURES ON EXHIBIT B ARE REDACTED
                                      [**]

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                                   EXHIBIT A-2

                            STATEMENT OF WORK - [**]

This Statement of Work, Exhibit A-2 is incorporated into that certain T-Mobile
USA Service Partner Services Agreement ("Agreement") dated August 1, 2005 by and
between T-Mobile USA, Inc. ("T-Mobile") and StarTek USA, Inc. ("StarTek"). The
Statement of Work shall be effective as of August 1, 2005 and the defined terms
used in this Statement of Work shall have the meanings provided in the Agreement
unless expressly defined herein

1.    GENERAL. StarTek will handle [**] work for T-Mobile. StarTek will maintain
      a dedicated program (i.e., StarTek's dedicated representatives shall
      handle only T-Mobile work, StarTek's team supervisors shall support only
      T-Mobile dedicated representatives and StarTek USA, Inc.'s team managers
      will support only T-Mobile dedicated team supervisors.) to perform the
      Services.

2.    HOURS OF OPERATION. Except as otherwise set forth herein, the hours of
      operation will be [**]. Any change to the hours of operation on a T-Mobile
      line of business at any site by StarTek requires written request and
      approval by a T-Mobile Vice President of the change. Any change to the
      hours of operation on a T-Mobile line of business at any site by T-Mobile
      requires written notification to StarTek. Any closure of a site or 100%
      reallocation of headcount to another site in which a T-Mobile line of
      business resides requires written notice to T-Mobile [**] in advance of
      the closure or reallocation. Any reallocation of headcount (not due to
      forecast change) to another site [**] of the total line of business
      headcount requires written notice to T-Mobile [**] in advance. StarTek
      will provide a comprehensive written plan as to how StarTek will maintain
      services to the line of business to mitigate impact and prevent tangible
      and intangible cost to T-Mobile.

3.    CALL VOLUME AND FORECASTING.

      For the purposes of meeting the forecast, StarTek will utilize full time
      equivalents ("FTEs") in accordance with this Statement of Work. An FTE is
      defined as [**] Customer Facing Employee [**]. An FTE is not equivalent to
      headcount.

      FTEs will be classified into the following categories:

      3..1. Production FTE, which includes FTEs who are agents productive to the
            line of business

      3..2. Training FTE, which includes FTEs who are currently in training and
            not productive to the line of business

      3..3. Get More Academy ("GMA") FTE, which includes FTEs who are productive
            to the line of business at least part of their day, but are still in
            training

      3..4. Leave of Absence ("LOA") FTE, which includes all FTEs who cannot be
            classified into Production, Training, or GMA.

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            T-Mobile will regularly prepare and deliver to StarTek the following
            forecasts for the services to support the proper planning of the
            infrastructure required to support the programs:

            3..1. T-Mobile shall deliver a [**] rolling informational forecast
                  to StarTek on or before the 15th day of each month (the
                  "[**]"), which shall contain forecasted [**] call volumes.

            3..2. T-Mobile shall deliver a final forecast to the StarTek no less
                  than 45 days before the 1st day of each [**] for which the
                  forecast is made, which shall contain a [**] call volume and
                  Average Handle Time ("AHT") forecast by [**] interval (the
                  "Final Forecast"). The Final Forecast will contain an updated
                  [**] call volume and AHT forecasts, which will vary no more
                  than [**] in call volume each day from the [**]. If the Final
                  Forecast is not delivered in a timely fashion with respect to
                  a particular month, the appropriate [**] rolling informational
                  forecast shall be the Final Forecast for such [**].

            3..3. For informational purposes only, T-Mobile shall deliver a [**]
                  forecast.

            StarTek will provide to T-Mobile all assumptions used to translate
            forecasts into scheduled FTE.

            T-Mobile and StarTek will mutually agree upon and participate in the
            preparation of other work volume forecasts, as reasonably required
            for the successful performance of the Programs for this line of
            business. These may include, without limitation, [**]. As part of
            the support structure, StarTek will provide a National Resource
            Planning Analyst who will, among other things, assist T-Mobile in
            the development of work volume forecasts.

            StarTek will recruit, train, and staff to a minimum of [**] of the
            forecasted FTE and be able to handle [**] of the forecasted work
            volume. If the Final Forecast for a particular [**] is [**] or more
            of the Final Forecast for the proceeding [**], StarTek may add
            additional staff to service such increase with the prior consent of
            T-Mobile, which consent shall not be unreasonably withheld.

            If the Production FTE count falls [**] below the forecasted FTE,
            StarTek will recruit and hire agents to back-fill the attrition. The
            recruited agents must start training within fourteen (14) days of
            exceeding threshold. The associated training costs are the
            responsibility of the StarTek and are not billable to T-Mobile.

            If the FTE requirement drops [**], T-Mobile will work with StarTek
            in good faith to back-fill with additional business [**] as StarTek
            ramps down to the required FTEs. T-Mobile and StarTek will mutually
            agree in writing on the number of FTEs that will be included in the
            ramp down.

4.    PRODUCTIVITY SPECIFIC TO WORKLOAD TYPE. T-Mobile and StarTek will agree on
      productivity measurements specific to the line of business.

5.    RAMP. Ramp is defined as any required FTE increase necessary to
      accommodate work volume growth of greater than [**] of the call/work
      volume during the peak [**] of the prior [**].

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6.    RAMP PLANS. For the purposes of this document a Ramp Plan is defined as a
      T-Mobile approved plan to add substantial FTEs to a current line of
      business or a change to the current line of business with substantial
      additions to current StarTek FTEs that support T-Mobile services. StarTek
      must submit written Ramp Plans to T-Mobile for written approval by a
      T-Mobile operations manager or above.

7.    TRAINING.

      Agents will be trained on the T-Mobile standard New-Hire Training
      Curriculum. Training for the program shall be in accordance with the
      T-Mobile New Hire Training Curriculum. Upon [**] written notice to
      StarTek, T-Mobile may change the T-Mobile New Hire Training Curriculum and
      the hours required for delivery. Prior to completion of training, T-Mobile
      will deliver all applicable application Ids to StarTek. Sharing of
      application IDs is prohibited under T-Mobile policy. StarTek will
      establish procedures to prevent sharing of application IDs. Any agent who
      violates this policy will be promptly removed from the T-Mobile account.

      Any new hire training conducted for net growth must be approved in writing
      by a T-Mobile training manager or above. Written approval must be attached
      to the invoice in order to substantiate billable new hire training.
      T-Mobile will be kept informed of all attrition training.

      All agent-level training-period performance, including attendance,
      quality, and assessment scores, regardless of whether net growth or
      attrition-related, will be reported [**] to [**] invoice.

      The ratio of trainers to trainees is not to exceed a classroom level of
      [**]. The [**] trainers can include a full-certified trainer with the
      support of a supervisor who has been through a certified training course.

      All costs and expenses for training and training materials for new agents
      and any initial and program extension training, or changes or
      modifications to the program or continuation training that exceeds [**]
      shall be borne by [**]. Online options must be used by StarTek in lieu of
      printed materials wherever reasonably available. All written materials
      must be reused by StarTek where reasonable. [**] will not reimburse for
      training or training materials utilized for attrition-related training.
      [**] shall not compensate [**] for any agent who does not complete the
      training and graduate from [**]. Documented training trackers must
      accompany all invoices for approval of billed charges. Documentation must
      contain as much information as allowed by law. Information required but
      not limited to: Agent name, agent training start date, attendance record,
      and assessment and quality scores. All Continuing Education classes are to
      be tracked via auxiliary (AUX) or automatic call distributor (ACD) code
      and submitted monthly with reporting displaying agent's name, the exact
      amount of time spent in each training course, the name of each training
      course, and the total time in the month spent in Continuing Education
      training. It is StarTek's responsibility to deliver all appropriate
      training within the scheduled time frame, subject to service level
      considerations.

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      StarTek will schedule Streamline read time not to exceed the amount of six
      (6) minutes per day, no more than thirty (30) minutes per agent per week.
      Streamline read time must be measured via ACD or AUX code, or via skill
      set, and reported monthly. Streamline read time will be billed at the
      hourly continuing education training rate and is subject to the [**]
      StarTek is responsible for as referenced in section 0.

      StarTek must not graduate any new hire agent from training/GMA to
      production if the agent has missed more than 8 hours in the training
      classroom, or 16 hours in GMA. The agent must return to the classroom or
      GMA as applicable to make up missed time before graduating to production.
      T-Mobile must receive written documentation of the missed time and proof
      that the time has been made up before being considered ready for
      production. New agents must also pass training assessments at [**] or
      higher in quality reviews during GMA to graduate from training to
      production.

      [**] [**] requests for removal of personnel, including, but not limited
      to, new trainers and any associated materials, [**].

      If StarTek is not meeting the quality standards set forth in Section 14
      below and it is determined by T-Mobile that additional "skill set"
      training is required for the StarTek representatives, [**] will bear the
      cost of the additional training.

      T-Mobile curriculum is to be facilitated by Certified Facilitators.
      Certification is to be provided by the StarTek. If the StarTek does not
      have a certification course they will be required to use the T-Mobile
      approved certification course. Facilitators are required to be certified
      by either T-Mobile Learning and Development specialist or a StarTek
      Certified Training Manager. Non-certified Supervisors/Operations
      Managers/Coaches or Team Leads cannot conduct New Hire Training.

      StarTek will abide by the documented training guidelines.

8.    ESCALATION PROCEDURES. StarTek shall utilize T-Mobile-provided escalation
      processes, to handle calls beyond the agent's scope of training or for
      management support of a customer issue. This process will ensure that each
      call that cannot be handled by the agent is then handled by the lead
      representative up through to the manager before being transferred to
      T-Mobile for resolution. If a customer requires management support, the
      agent shall transfer the call to a manager. T-Mobile shall update all
      on-line job aides that define the escalation procedures for the program
      when any changes are made.

9.    [**]

      9..1. [**]

10.   CUSTOMER CARE SYSTEMS. StarTek shall be responsible for costs associated
      with workstations and local area network (LAN) infrastructure equipped to
      run the most recent version of the [**] deployed at the time of the
      implementation of this Agreement. StarTek is hereby granted a license for
      the term of this Agreement to use the [**] for the sole purposes of
      performing its obligations under this Agreement. StarTek shall also
      provide the building and telecommunications

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      switch for the Interactive Voice Response (IVR) system, remote monitoring
      application and associated toll free number, Universal Power Supply (UPS),
      desktop computers, office supplies, and dedicated workspaces in each call
      center. [**] shall be responsible for costs associated with wide area
      network (WAN) infrastructure (including, but not limited to, the WAN data
      connectivity infrastructure, application/database servers, routers, and
      related peripherals. [**] shall also be responsible for software required
      to support the [**]. T-Mobile will be responsible for the [**], Knowledge
      Database, and Call Tracking systems required to support the Services
      performed under this Agreement.

11.   SYSTEMS USE AND DOWNTIME. Information given to callers or collected by
      agents will be directly taken from and/or input into T-Mobile's systems.
      In the event that T-Mobile's systems go down, StarTek shall capture call
      information in Remedy, or on the downtime forms provided by T-Mobile.
      StarTek will be instructed on procedures in each scenario as applicable by
      T-Mobile. If paper forms are utilized, StarTek agrees that it shall then
      input information from these downtime forms once the system is restored.
      Turnaround commitment to enter downtime forms into T-Mobile's systems will
      be [**] from the time when T-Mobile's systems are restored. If call volume
      does not allow for [**] turnaround due to call volume meeting at least
      [**] of the forecasted volume, another [**] input period shall be granted.
      Downtime forms will be destroyed (shredded or burned) or sent to T-Mobile,
      as directed by T-Mobile, every [**]. StarTek will assign a special ACD
      tracking code to designate when specified representatives are entering
      downtime form information into System. StarTek shall provide a downtime
      productivity report to T-Mobile displaying time in code, number of
      downtime forms processed and occupancy rate. T-Mobile agrees to pay
      StarTek the [**] (contingent upon meeting [**] per rep to be agreed upon
      by both parties) for entering downtime information as stated in the
      Pricing Schedule set forth in Section 24 of this Statement of Work.

12.   OVERTIME.

      If the daily work volume will exceed the Final Forecast by more than [**],
      StarTek will so notify T-Mobile and will recruit trained agents to work
      overtime to support the work handling. If the Final Forecast is within
      [**], StarTek must recruit agents to work overtime to cover the shortage
      and StarTek shall be responsible for any overtime expenses. Any additional
      staffing required for call volume over [**] of Final Forecast must be
      approved by T-Mobile in advance. T-Mobile will pay the overtime rate for
      all approved overtime.

      The recruiting process for overtime shall be deployed as soon as the
      circumstance affecting the call volume variance is identified. If StarTek
      identifies the item at least [**] before the occurrence, StarTek shall use
      its commercially reasonable efforts to minimize the financial impact by
      changing schedules to support the staffing required. StarTek shall also
      recruit agents to work overtime on a [**] basis when the [**] call volume
      dictates additional staffing needs to maintain service goals.

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      Except as provided above in Section 12.2, StarTek shall obtain written
      authorization from T-Mobile for any overtime that may be required or
      incurred for the performance of the Programs.

      A reasonable estimate for the amount of overtime necessary to meet the
      Service Level will be provided to T-Mobile for written approval. Overtime
      need should be driven by call/work [**] of the forecast. Overtime
      resulting from staffing [**].

13.   SIGNIFICANT CHANGES. When significant changes occur to the processes
      utilized to provide services, T-Mobile has the right to request
      information related to compliance and execution of such changes.

14.   KPIS. The KPIs for services performed here under shall be as follows:

      Data Accuracy Goal: [**]

      B2B and B2C Turnaround Time:

      14..1. [**]

      14..2. [**]

15.   REPORTS StarTek shall provide T-Mobile with [**] statistics that outline
      the number of FTP (define) Activation Orders activated and Inbound
      transfers handled on a [**] basis for the previous [**] by [**]. StarTek
      shall provide each of T-Mobile's [**] Vendors with an [**] outlining, at a
      minimum, [**] If a T-Mobile [**] Vendor requires significant material
      format changes to T-Mobile standard reports, T-Mobile will be required to
      compensate StarTek for the development costs, based upon the rate outlined
      in the Pricing Schedule set forth in Section 25 of this Statement of Work
      and will be [**] prior to invoicing. StarTek shall provide T-Mobile with a
      method of tracking work requests received via any inbound channel for the
      purpose of record keeping and escalation investigation. All records will
      be kept in an accessible database for the period of [**] year before
      archiving electronically.

16.   MONITORING. T-Mobile shall have the right, to the extent permitted by law
      and at no additional expense, to monitor at any time (either on-site or
      remotely) customer contact calls and/or specific agents to ensure
      compliance with performance, operational and quality control standards.
      [**] must provide [**] with a remote monitoring solution. There are two
      quality monitoring options required: a [**] and a [**]. [**] will manage
      the [**] calls within [**] of being [**]. [**] requires a minimum of [**]
      calls per agent per month [**]. [**] must have the ability to monitor
      random calls as they come into the queue, or by locating specific agents
      [**].

A.    HOLIDAYS. StarTek shall observe the following holiday schedule [**].
      T-Mobile shall compensate StarTek for holiday rates as identified in the
      Pricing Schedule set forth hereunder when applicable to the location where
      work is performed. Holiday rates apply to the actual holiday only.

                    [**]                            US HOLIDAYS
                    [**]                      New Year's Day (Jan 1)

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                    [**]                 Memorial Day (last Monday in May)
                    [**]                      Fourth of July (July 4)
                    [**]               Labor Day (first Monday in September)
                    [**]            Thanksgiving Day (4th Thursday in November)
                    [**]                      Christmas (December 25)

17.   SYSTEM DOWNTIME; FORCE MAJEURE.

      In the event StarTek determines that system maintenance is necessary,
      StarTek will notify T-Mobile of the need for such maintenance five [**]
      prior to the maintenance, and will obtain the prior written approval of
      T-Mobile to schedule the time and duration of such maintenance. All
      routine maintenance shall be scheduled during off-peak system hours. In no
      event shall interruption of Services for prior disclosed and approved
      system maintenance constitute a failure of performance by StarTek if
      performed in accordance with this Section 17. StarTek shall promptly
      report to T-Mobile any StarTek system failures, including information on
      the duration and impact.

      Except for T-Mobile's obligation to make payments for services actually
      performed, each Party's failure to perform shall be excused where such
      failure is a result of causes beyond its reasonable control. Such causes
      shall include without limitation acts of God, strikes, lockouts, riots,
      acts of war, epidemics, governmental regulations imposed after the fact,
      fire, communication line failures of third parties, vandalism, power
      failures by third parties, cables cut by third parties, earthquakes,
      floods or other similar catastrophes, terrorist activities, failure of the
      T-Mobile system or the Internet not related to StarTek's actions or
      inactions, any law, order, regulation, direction, action or request of any
      governmental entity or court or civil or military authority having
      jurisdiction over either of the parties, national emergencies,
      insurrections, riots, wars, strikes, lock outs, or work stoppages. In the
      event of failures to perform for [**] or more as a result of a force
      majeure, either Party may terminate the Agreement by giving written notice
      to the other Party. Any such notice of termination shall be effective upon
      receipt.

      Notwithstanding the foregoing or anything in the Agreement to the
      contrary, StarTek shall take commercially reasonable steps to ensure that
      the Services shall continue without interruption due to a StarTek systems
      failure during the term of the Agreement by implementing [**] reasonably
      necessary to provide the Services with an up-time of [**] (not including
      scheduled maintenance), which shall include [**] and the like. The
      components and execution of this plan must be reviewed, updated, and
      tested semi-annually and results reported to T-Mobile.

18.   ALLOCATION OF RESOURCES. T-Mobile acknowledges that upon the occurrence of
      a force majeure event or in instances of unusually high demand, demands on
      StarTek's facilities may exceed such facilities available capacity. In any
      such instance, StarTek shall, upon written notice to T-Mobile, be entitled
      to equitably prioritize Services and otherwise curtail utilization of its
      facilities in a manner so that any degradation to the Services provided to
      T-Mobile is (unless agreed

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      otherwise by T-Mobile in writing) no greater than the level of degradation
      experienced by StarTek's other customers. Upon the request of T-Mobile,
      StarTek shall provide T-Mobile with reasonable evidence of its compliance
      with the foregoing.

19.   RECRUITING REQUIREMENTS. StarTek recruiting efforts shall meet the
      following requirements in the selection process of all personnel hired to
      perform the T-Mobile services as described in this Statement of Work.
      T-Mobile reserves the right to audit the selection process.

      A mutually approved customer service assessment

      A behavioral interview

      Background checks, which shall include criminal records, are required and
      shall be completed before employment. Costs incurred for background checks
      associated with such criminal records [**]

20.   STAFFING REQUIREMENTS. StarTek agrees to maintain the following staffing
      ratios: [**] StarTek agrees that all managers shall be full-time StarTek
      employees. Subject to Section 21.1, StarTek will ensure that each person
      assigned to a function has the necessary functional and T-Mobile-related
      training to successfully perform the function. StarTek must provide
      specific agent information up to what the law allows. Information required
      includes agent name, T-Mobile agent IDs, start date on T-Mobile line of
      business, assessment scores, termination date from T-Mobile line of
      business, quality average.

21.   All support functions such as StarTek quality, instructional analysts, and
      trainers must be housed within the site where the work is being performed
      unless otherwise agreed to in writing by T-Mobile.

      In addition, before a function is performed by an individual assigned to
      that function, StarTek shall verify that the necessary skills have been
      attained through the use of certification of skills program. If T-Mobile
      reasonably requests StarTek to remove any personnel performing Services
      pursuant to this Agreement, StarTek shall promptly comply with such
      request, within [**]. In support of this process, StarTek will do the
      following:

      21..1.Team leaders/supervisors shall perform productive work for at least
            [**] to maintain their skills. The remainder of their time shall be
            used to support agent development, and to otherwise assist StarTek
            employees to perform the Services.

      21..2. Quality Assurance specialists shall perform productive work for at
            least [**] to maintain their skills.

      21..3. Managers, lead representatives, team leaders/supervisors and
            trainers must be full-time employees of StarTek and must have
            completed T-Mobile National Standard Curriculum Training.

      21..4. Supervisors will audit a mutually agreeable amount of agent work
            per week for accuracy.

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22.   FRAUD. StarTek shall implement and enforce T-Mobile policies and
      procedures as well as StarTek's own procedures to detect and prevent
      handset or credit card theft or other fraudulent activity by an employee
      or agent of StarTek StarTek shall cooperate with any T-Mobile
      investigation into handset or credit care theft or other fraudulent
      activity by an employee or agent of StarTek. If an employee or agent of
      StarTek is suspected of committing handset or credit card theft or other
      fraudulent activity against T-Mobile, StarTek will promptly notify
      T-Mobile of the suspected fraudulent activity and will provide T-Mobile
      with information necessary to conduct an investigation, including but not
      limited to the employee name, address, contact information, social
      security number, emergency contact address and phone numbers, and any
      other information that will assist in investigation of the suspected
      fraudulent activity. This information will be provided to T-Mobile within
      48 hours of the request from T-Mobile.

  StarTek will assume all responsibility for handset theft, credit card theft or
  other fraudulent activity by an employee or agent of StarTek or their failure
  to follow T-Mobile policies and procedures. [**] to the following address:

         T-Mobile USA, Inc.
         Attn:  Kevin Golas, Sr. Manager of Investigations
         794 Roble Road
         Allentown, PA  18109

  [**] shall be made to T-Mobile within [**] of the date StarTek receives an
  [**].

  T-Mobile reserves the right to prosecute any employee or agent of StarTek who
  committed fraud against T-Mobile or a customer of T-Mobile.

23.   BILLABLE HOURS: For purposes of this Agreement, "Billable Hours" is
      defined as:

      Hours [**]to [**], which [**]

      [**] hours shall not exceed the [**] unless increased workload is [**] and
      is [**] in writing.

24.   SERVICE LEVELS /BREACH OF SERVICE LEVELS. StarTek shall meet or exceed the
      Key Performance Indicator Service Levels as provided in Section 14.

      In the event that StarTek negatively performs any of the Key Performance
      Indicators for a consecutive period of [**], StarTek shall be in breach of
      this Agreement. StarTek shall prepare a plan to cure the breach and shall
      have [**] from the date of the first date of failure in which to cure the
      breach. In the event that StarTek fails to cure the breach within the [**]
      period from the date of the first date of failure, T-Mobile may terminate
      the Agreement for StarTek's breach.

25.   PRICING SCHEDULE. T-Mobile shall pay StarTek for Services as provided in
      the following schedule:

      PRODUCTION PRICING.

      25..1. Standard Rate: [**]

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      25..2. Holiday Rate: [**]

      25..3. Overtime Rate: [**]

      AGENT TRAINING.

      25..1. [**]

      25..2. [**]

      25..3. [**]

      25..4. [**]

      25..5. [**]

      25..6. [**]

      25..7. [**]

      25..8. [**]

      25..9. [**]

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                                   EXHIBIT A-3

                            STATEMENT OF WORK - [**]

This Statement of Work, Exhibit A-5 is incorporated into that certain T-Mobile
USA Service Partner Services Agreement ("Agreement") dated August 1, 2005 by and
between T-Mobile USA, Inc. ("T-Mobile") and StarTek USA, Inc. ("StarTek"). The
Statement of Work shall be effective as of August 1, 2005 and the defined terms
used in this Statement of Work shall have the meanings provided in the Agreement
unless expressly defined herein

1.    GENERAL. StarTek will handle inbound [**] calls for T-Mobile. StarTek will
      maintain a dedicated program (i.e., StarTek's dedicated representatives
      shall handle only T-Mobile calls, StarTek's team supervisors shall support
      only T-Mobile dedicated representatives and StarTek's team managers will
      support only T-Mobile dedicated team supervisors.) to perform the
      Services.

2.    HOURS OF OPERATION. Except as otherwise set forth herein, the hours of
      operation [**]. Any change to the hours of operation on a T-Mobile line of
      business at any site by StarTek requires written request and approval by a
      T-Mobile Vice President of the change. Any change to the hours of
      operation on a T-Mobile line of business at any site by T-Mobile requires
      written notification to StarTek. Any closure of a site or 100%
      reallocation of headcount to another site in which a T-Mobile line of
      business resides requires written notice to T-Mobile of [**] in advance of
      the closure or reallocation. Any reallocation of headcount (not due to
      forecast change) to another site [**] of the total [**] headcount requires
      written advanced notice to T-Mobile [**] StarTek will provide a
      comprehensive written plan as to how StarTek will maintain services of
      line of business to mitigate impact and prevent tangible and intangible
      cost to T-Mobile

3.    CALL VOLUME AND FORECASTING.

      3.1.  For the purposes of meeting the forecast, StarTek will utilize full
            time equivalents ("FTEs") in accordance with this Statement of Work.
            An FTE is defined as [**] Customer Facing Employee [**]. An FTE is
            not equivalent to a headcount.

      3.2.  FTEs will be classified into the following categories:

            3.2.1. Production FTE, which includes FTEs who are agents productive
                  to the line of business

            3.2.2. Training FTE, which includes FTEs who are currently in
                  training and not productive to the line of business

            3.2.3. Get More Academy ("GMA") FTE, which includes FTEs who are
                  productive to the line of business at least part of their day,
                  but are still in training

            3.2.4. Leave of Absence ("LOA") FTE, which includes all FTEs who
                  cannot be classified into Production, Training, or GMA.

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      3.3.  T-Mobile will regularly prepare and deliver to StarTek the following
            forecasts for the services to support the proper planning of the
            infrastructure required to support the programs:

            3.3.1. T-Mobile shall deliver a [**] rolling informational forecast
                  to StarTek on or before the 15th day of each month (the
                  "[**]"), which shall contain forecasted [**] call volumes.

            3.3.2. T-Mobile shall deliver a final forecast to StarTek no less
                  than 45 days before the 1st day of each [**] for which the
                  forecast is made, which shall contain a daily call volume and
                  Average Handle Time ("AHT") forecast by [**] interval (the
                  "Final Forecast"). The Final Forecast will contain an updated
                  [**] call volume and AHT forecasts, which will vary no more
                  than [**] in call volume each day from the [**]. If the Final
                  Forecast is not delivered in a timely fashion with respect to
                  a particular month, the appropriate [**] rolling informational
                  forecast shall be the Final Forecast for such [**].

            3.3.3. For informational purposes only, T-Mobile shall deliver a
                  [**] forecast.

      3.4.  StarTek will use [**] call volume forecasts provided by T-Mobile as
            the Final Forecast in accordance with this Agreement. This process
            is known as Interval Forecasting. StarTek will schedule the
            appropriate number of FTEs in [**] intervals to meet service levels
            outlined in the T-Mobile Final Forecast. This process is known as
            Interval Scheduling. StarTek will provide Interval Scheduling plans
            to T-Mobile as a [**] look ahead after receiving a Final Forecast
            from T-Mobile. These Interval Scheduling plans will illustrate how
            StarTek plans to meet the Key Performance Indicator (KPI) Service
            Level. The documented plans will include the number of required FTEs
            to meet the KPI Service Level, the number of scheduled agents, and
            the [**] Service Level Objectives.

      3.5.  StarTek will provide to T-Mobile USA all assumptions used to
            translate forecasts into scheduled FTEs.

      3.6.  T-Mobile and StarTek will cooperatively manage [**] schedule
            adjustments to manage actual call volumes.

      3.7.  T-Mobile and StarTek will mutually agree upon and participate in the
            preparation of other call volume forecasts, as reasonably required
            for the successful performance of the Programs. These may include,
            without limitation, [**]. As part of the support structure, StarTek
            will provide a National Resource Planning Analyst who will, among
            other things, assist T-Mobile in the development of call volume
            forecasts.

      3.8.  StarTek will recruit, train, and staff to a minimum of [**] of the
            forecasted FTE and be able to handle [**] of the forecasted call
            volume. If the Final Forecast for a particular [**] is [**] or more
            of the Final Forecast for the proceeding [**], StarTek may add
            additional staff to service such increase with the prior consent of
            T-Mobile, which consent shall not be unreasonably withheld.

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      3.9.  If the Production FTE count falls [**] below the forecasted FTE,
            StarTek will recruit and hire agents to back-fill the attrition as
            long as T-Mobile is delivering a minimum of [**] of forecasted
            volume. The recruited agents must start training within [**] days of
            exceeding threshold. [**]

      3.10. If the FTE requirement drops [**], T-Mobile will work with StarTek
            in good faith to back-fill with additional business [**] as StarTek,
            Inc. ramps down to the required FTEs. T-Mobile and StarTek will
            mutually agree in writing on the number of FTEs that will be
            included in the ramp down.

      3.11. The forecasts referred to above shall in no way represent a
            commitment from T-Mobile to provide volumes to StarTek, except for
            purposes of amounts payable by T-Mobile to StarTek as provided in
            this Section 3.12.

      3.12. Amounts payable to StarTek hereunder and the KPI calculation shall
            be based upon the following:

            3.12.1. When the [**] exceeds [**] of Final Forecast then StarTek
                  shall be paid for the [**]

            3.12.2. When the [**] is less than [**] of the Final Forecasted call
                  volume, and StarTek is staffed at no less than [**] of the
                  required Final Forecasted FTE, then StarTek shall be paid
                  according to the following formula: [**].

4.    AVERAGE HANDLE TIME. Average Handle Time ("AHT") is defined as the sum of
      average talk time; hold time while on a call, and after call work. StarTek
      agrees that the AHT objectives shall be [**] for English Activations. The
      AHT objective shall be less than or equal to a [**]. The AHT objectives
      may be changed upon mutual agreement of StarTek and T-Mobile USA based on
      rolling [**] trending results.

5.    RAMP. Ramp is defined as any required FTE increase necessary to
      accommodate call volume growth of greater than [**] of the volume in the
      peak [**] of the prior [**].

6.    RAMP PLANS. For the purposes of this document a Ramp Plan is defined as a
      T-Mobile approved plan to add substantial FTEs to a current line of
      business or a change to the current line of business with substantial
      additions to current StarTek FTEs that support T-Mobile services. StarTek
      must submit written Ramp Plans to T-Mobile for written approval by a
      T-Mobile operations manager or above.

      6.1.  In the event of a new ramp plan or a change to the [**] line of
            business supported by StarTek, the AHT monthly objectives will be
            adjusted depending upon the percentage of net growth in training FTE
            graduates to the maximum headcount during the growth period. The
            embedded MS Excel worksheet is an example of the adjustments and
            will be subject to the AHT objectives agreed to as set forth in
            Section 4 A printed example is shown in Exhibit C.

7.    TRAINING.

      7.1.  Agents will be trained on the standard T-Mobile standard New Hire
            Training Curriculum. Training for the program shall be conducted in
            accordance with the T-Mobile New Hire Training Curriculum. Upon [**]
            written notice to StarTek,

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            T-Mobile may change the T-Mobile New Hire Training Curriculum and
            the hours required for delivery. Prior to completion of training,
            T-Mobile will deliver all applicable application IDs. Sharing of
            application IDs is prohibited under T-Mobile policy. StarTek will
            establish procedures to prevent sharing of application IDs. Any
            agent who violates this policy will be promptly removed from the
            T-Mobile account.

      7.2.  Any new hire training conducted for net growth must be approved in
            writing by a T-Mobile training manager or above. Written approval
            must be attached to the invoice in order to substantiate billable
            new hire training. T-Mobile will be kept informed of all attrition
            during the training period.

      7.3.  The ratio of trainers to trainees is not to exceed a classroom level
            of [**] The two trainers can include a fully certified trainer with
            the support of a supervisor who has been through a certified
            training program.

      7.4.  All costs and expenses for training and training materials for new
            agents and any initial and program extension training, or changes or
            modifications to the program or continuation training that exceeds
            [**] shall be borne by [**]. Online options must be used by StarTek
            in lieu of printed materials wherever reasonably available. All
            written materials must be reused by StarTek where reasonable. [**]
            will not reimburse for training or training materials utilized for
            attrition-related training. [**] shall not compensate [**] for any
            agent who does not complete the training and graduate from [**].
            Documented training trackers must accompany all invoices for
            approval of billed charges. Documentation must contain as much
            information as allowed by law. Information required but not limited
            to: Agent name, agent training start date, attendance record, and
            assessment and quality scores. All Continuing Education classes are
            to be tracked via auxiliary (AUX) or automatic call distributor
            (ACD) code and submitted monthly with reporting displaying agent's
            name, the exact amount of time spent in each training course, the
            name of each training course, and the total time in the month spent
            in Continuing Education training. It is StarTek's responsibility to
            deliver all appropriate training within the scheduled time frame,
            subject to service level considerations.

      7.5.  StarTek will schedule StreamLine read time not to exceed the amount
            of six (6) minutes per day, no more than thirty (30) minutes per
            agent. Streamline read time must be measured via ACD or AUX code, or
            skill set, and reported monthly. Streamline read time will be billed
            at the hourly continuing education training rate and is subject to
            the [**] StarTek is responsible for as referenced in Section 7.4.

      7.6.  StarTek must not graduate any new hire agent from training/GMA to
            production if the agent has missed more than 8 hours in the training
            classroom16 hours in GMA. The agent must return to the classroom or
            GMA as applicable to make up missed time before graduating to
            production. T-Mobile must receive written documentation of the
            missed time and proof that the time has been made up before being
            considered ready for production. New agents must also pass

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            training assessments at 85% or better and score 2.6 or higher in
            quality during GMA to graduate from training to production.

      7.7.  [**] requests for removal of personnel including, but not limited
            to, new trainers and any associated materials, [**].

      7.8.  If StarTek is not meeting the quality standards set forth in Section
            14.3 below and it is determined by T-Mobile that additional "skill
            set" training is required for StarTek representatives, [**] will
            bear the cost of the additional training.

      7.9.  T-Mobile curriculum is to be facilitated by Certified Facilitators.
            T-Mobile Certification to be provided by StarTek. If StarTek does
            not have a certification course they will be required to use the
            T-Mobile certification course. Facilitators are required to be
            certified by either T-Mobile Learning and Development specialist or
            their own Certified Training Manager. Uncertified
            Supervisors/Operations Managers/Coaches or Team Leads cannot conduct
            new Hire training.

      7.10. StarTek will abide by the documented training guidelines. Any
            changes to the documented training guidelines by T-Mobile must be
            provided to StarTek no less than [**] prior to implementation. Any
            changes materially impacting StarTek's cost must be agreed to by
            both parties.

8.    ESCALATION PROCEDURES. StarTek shall utilize T-Mobile-provided escalation
      processes, to handle calls beyond the agent's scope of training or for
      management support of a customer issue. This process will ensure that each
      call that cannot be handled by the agent is then handled by the lead
      representative up through the manager before being transferred to T-Mobile
      for resolution. If a customer requires management support, the agent shall
      transfer the call to a manager. T-Mobile shall update all on-line job
      aides that define the escalation procedures for the program when any
      changes are made.

9.    [**]

      9.1.  [**]

10.   CUSTOMER CARE SYSTEMS. StarTek shall be responsible for costs associated
      with workstations and local area network (LAN) infrastructure equipped to
      run the most recent version of the [**] deployed at the time of the
      implementation of this Agreement. StarTek is hereby granted a license for
      the term of this Agreement to use the [**] for the sole purposes of
      performing its obligations under this Agreement. StarTek shall also
      provide the building and telecommunications switch for the Interactive
      Voice Response (IVR) system, remote monitoring application and associated
      toll free number, Universal Power Supply (UPS), desktop computers, office
      supplies, and dedicated workspaces in each call center. [**] shall be
      responsible for costs associated with wide area network (WAN)
      infrastructure (including, but not limited to, the WAN data connectivity
      infrastructure, application/database servers, routers, and related
      peripherals. [**] shall also be responsible for software required to
      support the [**]. T-Mobile will be responsible for the [**], Knowledge
      Database, and Call Tracking systems required to support the Services
      performed under this Agreement.

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11.   SYSTEMS USE AND DOWNTIME. Information given to callers or collected by
      agents will be directly taken from and/or input into T-Mobile's systems.
      In the event that T-Mobile's systems go down, StarTek shall capture call
      information in Remedy, or on the downtime forms provided by T-Mobile.
      StarTek will be instructed on procedure in each scenario as applicable by
      T-Mobile. If paper forms are utilized, StarTek agrees that it shall then
      input information from these downtime forms once the system is restored.
      Turnaround commitment to enter downtime forms into T-Mobile's systems will
      be [**] from the time when T-Mobile's systems are restored. If call volume
      does not allow for [**] hour turnaround due to call volume meeting at
      least [**] of the forecasted volume, another [**] input period shall be
      granted. Downtime forms will be destroyed (shredded or burned) or sent to
      T-Mobile, as directed by T-Mobile, every [**]. StarTek will assign a
      special ACD tracking code to designate when specified representatives are
      entering downtime form information into T-Mobile systems. StarTek shall
      provide a downtime productivity report to T-Mobile displaying time in
      code, number of downtime forms processed and occupancy rate. T-Mobile
      agrees to pay StarTek the [**] (contingent upon meeting [**] per rep to be
      agreed upon by both parties) for entering downtime information as stated
      in the Pricing Schedule set forth in Section 24 of this Statement of Work.

12.   OVERTIME.

      12.1. If the call volume exceeds the Final Forecast by more than [**],
            StarTek will so notify T-Mobile and will recruit trained agents to
            work overtime to support the call handling. Any overtime in excess
            of [**] of forecasted volume must be authorized by T-Mobile
            operations manager or above. For T-Mobile authorized overtime
            T-Mobile will pay the overtime rate set forth in Section 25 for all
            volume handled in excess of [**] of the Final Forecast. The billable
            overtime minutes will be calculated as set forth in Section 12.4.

      12.2. The recruiting process for overtime shall be deployed as soon as the
            circumstance affecting the call volume variance is identified. If
            StarTek identifies the item at least [**] before the occurrence,
            StarTek shall use its commercially reasonable efforts to minimize
            the financial impact by changing schedules to support the staffing
            required. StarTek shall also recruit agents to work overtime on a
            [**] basis when the [**] call volume dictates additional staffing
            needs to maintain service goals.

      12.3. Except as provided above in Section 12.2, StarTek shall obtain
            written authorization from T-Mobile for any overtime that may be
            required or incurred for the performance of the Programs.

      12.4. T-Mobile authorized overtime as defined in section 12.1 will be
            calculated for purposed of invoice payment by multiplying the
            handled call volume in excess of [**] of Final Forecast by the [**],
            and dividing through by 60 to get minutes.

13.   SIGNIFICANT CHANGES. When significant changes occur to the processes
      utilized to provide services, T-Mobile has the right to request
      information related to compliance and execution of such changes.

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14.   KPI'S. The KPI's for Services performed hereunder shall be effective for
      purposes of bonus/penalty adjustments to the invoice, as set forth in
      Exhibit B.

      14.1. Service Level. Inbound [**] customer service calls: [**]

      14.2. Call Volume. [**]

      14.3. Call Quality. According to the results from the call quality
            observation process, as described below, with a minimum score of
            [**].

            14.3.1. For the purposes of ensuring Call Quality, StarTek and
                  T-Mobile shall measure the agents' call quality using the
                  following types of observations:

                14.3.1.1. T-Mobile observation

                14.3.1.2. StarTek operations observation (4 per agent/month);

                14.3.1.3. StarTek quality observation (4 per agent/month)

            14.3.2. KPI performance is based upon T-Mobile scores only, whereas
                  the function of the StarTek operations and quality
                  observations is to provide immediate and monthly feedback to
                  agents and StarTek management.

            14.3.3. For the purposes of billing, the scores for all of these
                  observations will be [**] The StarTek operations and StarTek
                  quality observations must each be [**] If either the StarTek
                  operations or the StarTek quality observation is not [**]
                  T-Mobile may provide written approval of exception to this
                  section 14.3.3 given the number of outsourced issue tickets on
                  T-Mobile observations.

            14.3.4. Calibration. StarTek operations managers shall attend the
                  monthly T-Mobile calibration sessions for the line of
                  business.

            14.3.5. The call quality observation form to be used in this process
                  shall be provided by T-Mobile. Results shall be used to
                  provide both immediate and monthly feedback to agents and
                  StarTek management. StarTek will make best effort to provide
                  each agent with feedback/coaching within 24 hours of being
                  monitored by T-Mobile, StarTek quality team or StarTek
                  operations. StarTek shall keep written documentation of each
                  agent session, signed by the agent, and available for review
                  by T-Mobile upon request. The call quality scoring criteria
                  used by StarTek will match that used by T-Mobile. StarTek must
                  achieve a minimum voice quality score of 3.0. Call monitoring
                  feedback sessions will be held between the agent and the
                  agent's direct supervisor. Any monitored calls using profanity
                  or customer abuse as determined by T-Mobile will result in
                  immediate, unchallenged agent termination from the T-Mobile
                  program.

      14.4.

15.   REPORTS. StarTek shall provide T-Mobile with standard call count reports
      and performance reports on a [**] basis ([**]) by [**] for the previous
      [**] by [**] for the previous [**], and [**] by [**] for the previous
      [**]. The reports shall be in the format and contain the information
      mutually agreed upon between StarTek and T-Mobile. StarTek shall provide
      report cards reflecting measurements of the KPIs and

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      all of the above metrics within [**] of each [**]. All reporting fed by
      data from the switch is considered standard and is not subject to
      non-standard report development costs. Hourly lines of business must have
      agent detail payroll reports to substantiate that billable hours do not
      exceed actual hours worked. T-Mobile and StarTek shall mutually agree upon
      any other reports and the cost associated with the development of those
      reports. T-Mobile agrees to follow the change management process defined
      by StarTek and agreed to by T-Mobile when requesting changes to reports or
      additional information. If T-Mobile requires material format changes to
      T-Mobile standard reports, T-Mobile will be required to compensate StarTek
      for the development costs, based upon the rate outlined in the Pricing
      Schedule set forth in Section 25 of this Statement of Work and will be
      [**] prior to invoicing.

16.   MONITORING. T-Mobile shall have the right, to the extent permitted by law
      and at no additional expense, to monitor at any time (either on-site or
      remotely) customer contact calls and/or specific agents to ensure
      compliance with performance, operational and quality control standards.
      [**] must provide [**] with a remote monitoring solution. There are two
      quality monitoring options required: a [**] and a [**]. [**] would manage
      the [**] calls within [**] of being [**]. [**] requires a minimum of [**]
      per agent per month [**]. [**] must have the ability to monitor random
      calls as they come into the queue, or by locating specific agents [**].

      A.    HOLIDAYS. StarTek shall observe the following holiday schedule [**].
            T-Mobile shall compensate StarTek for holiday rates as identified in
            the Pricing Schedule set forth hereunder when applicable to the
            location where work is performed. Holiday rates apply to the actual
            holiday only.

                    [**]                             US HOLIDAYS
                    [**]                       New Year's Day (Jan 1)
                    [**]                  Memorial Day (last Monday in May)
                    [**]                       Fourth of July (July 4)
                    [**]                Labor Day (first Monday in September)
                    [**]             Thanksgiving Day (4th Thursday in November)
                    [**]                       Christmas (December 25)

17.   SYSTEM DOWNTIME; FORCE MAJEURE.

      17.1.In the event StarTek determines that system maintenance is necessary,
            StarTek will notify T-Mobile of the need for such maintenance [**]
            prior to the maintenance, and will obtain the prior written approval
            of T-Mobile to schedule the time and duration of such maintenance.
            All routine maintenance shall be scheduled during off-peak system
            hours. In no event shall disclosed and approved interruption of
            Services for system maintenance constitute a failure of performance
            by StarTek if performed in accordance with this Section 17. StarTek
            shall promptly report to T-Mobile any StarTek system failures,
            including the duration and impact.

      17.2. Except for T-Mobile's obligation to make payments for services
            actually performed, each Party's failure to perform shall be excused
            where such failure is

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            a result of causes beyond its reasonable control. Such causes shall
            include without limitation acts of God, strikes, lockouts, riots,
            acts of war, epidemics, governmental regulations imposed after the
            fact, fire, communication line failures of third parties, vandalism,
            power failures by third parties, cables cut by third parties,
            earthquakes, floods or other similar catastrophes, terrorist
            activities, failure of the T-Mobile system or the Internet not
            related to StarTek's actions or inactions, any law, order,
            regulation, direction, action or request of any governmental entity
            or court or civil or military authority having jurisdiction over
            either of the parties, national emergencies, insurrections, riots,
            wars, strikes, lock outs, or work stoppages. In the event of
            failures to perform for [**] or more as a result of a force majeure,
            either Party may terminate the Agreement by giving written notice to
            the other Party. Any such notice of termination shall be effective
            upon receipt.

      17.3.Notwithstanding the foregoing or anything in the Agreement to the
            contrary, StarTek shall take commercially reasonable steps to ensure
            that the Services shall continue without interruption due to StarTek
            systems failure during the term of the Agreement by implementing
            [**] reasonably necessary to provide the Services with an up-time of
            [**] (not including scheduled maintenance), which shall include [**]
            and the like. The components and execution of this plan must be
            reviewed, updated, and tested semi annually and results reported to
            T-Mobile.

      17.4. Where downtime is a result of [**]

      17.5. Where downtime is a result of [**]

18.   ALLOCATION OF RESOURCES. T-Mobile acknowledges that upon the occurrence of
      a force majeure event or in instances of unusually high demand, demands on
      StarTek's facilities may exceed such facilities available capacity. In any
      such instance, StarTek shall, upon written notice to T-Mobile, be entitled
      to equitably prioritize Services and otherwise curtail utilization of its
      facilities in a manner so that any degradation to the Services provided to
      T-Mobile is (unless agreed otherwise by T-Mobile in writing) no greater
      than the level of degradation experienced by StarTek's other customers.
      Upon the request of T-Mobile, StarTek shall provide T-Mobile with
      reasonable evidence of its compliance with the foregoing.

19.   RECRUITING REQUIREMENTS. StarTek recruiting efforts shall meet the
      following requirements in the selection process of all personnel hired to
      perform the T-Mobile USA services as describe in this SOW. T-Mobile
      reserves the right to audit the selection process.

      19.1. A mutually approved customer service assessment

      19.2. A behavioral interview

      19.3.Background checks, which shall include criminal records, are required
            and shall be completed before employment. Costs incurred for
            background checks associated with such criminal records [**].

20.   STAFFING REQUIREMENTS. StarTek agrees to maintain the following staffing
      ratios: [**] StarTek agrees that all managers shall be full-time StarTek
      employees. Subject

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      to Section 21.1, StarTek will ensure that each person assigned to a
      function has the necessary functional and T-Mobile-related training to
      successfully perform the function. StarTek must provide specific agent
      information up to what the law allows. Information required includes agent
      name, agent ID, start date on T-Mobile line of business, assessment
      scores, termination date from T-Mobile line of business, quality average.

21.   All support functions such as StarTek quality, instructional analysts, and
      trainers must be housed within the site where the work for this line of
      service is being performed unless otherwise agreed to in writing by
      T-Mobile.

      21.1.In addition, before a function is performed by an individual assigned
            to that function, StarTek shall verify that the necessary skills
            have been attained through the use of certification of skills
            program. If T-Mobile reasonably requests StarTek to remove any
            personnel performing Services pursuant to this Agreement, StarTek
            shall promptly comply with such request, within [**]. In support of
            this process, StarTek will do the following:

      21.1.1. Team leaders/supervisors shall go on-line to support customer
            calls each week for at least [**] per day (approximately [**]) to
            maintain their skills. The remainder of their time shall be used to
            support agent development, and to otherwise assist StarTek employees
            to perform the Services.

      21.1.2. Quality Assurance specialists shall go on-line to support customer
            calls each month for at least 10 calls per [**] (approximately [**])
            to maintain their skills.

      21.1.3. Managers, lead representatives, team leaders/supervisors and
            trainers must be full-time employees of StarTek and must have
            completed T-Mobile National Standard Curriculum Training.

      21.1.4. Supervisors will monitor a minimum of two (2) calls per agent per
            week.

22.   FRAUD. StarTek shall implement and enforce T-Mobile policies and
      procedures as well as StarTek's own procedures to detect and prevent
      handset or credit card theft or other fraudulent activity by an employee
      or agent of StarTek. StarTek shall cooperate with any T-Mobile
      investigation into handset or credit card theft or other fraudulent
      activity by an employee or agent of StarTek. If an employee or agent of
      StarTek is suspected of committing handset or credit card theft or other
      fraudulent activity against T-Mobile, StarTek will promptly notify
      T-Mobile of the suspected fraudulent activity and will provide T-Mobile
      with information necessary to conduct an investigation, including but not
      limited to the employee name, address, contact information, social
      security number, emergency contact address and phone numbers, and any
      other information that will assist in investigation of the suspected
      fraudulent activity. This information will be provided to T-Mobile within
      48 hours of the request from T-Mobile.

      StarTek will assume all responsibility for handset theft, credit card
      theft or other fraudulent activity by an employee or agent of StarTek or
      their failure to follow T-Mobile policies and procedures. [**] to the
      following address:

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              T-Mobile USA, Inc.
              Attn:  Kevin Golas, Sr. Manager of Investigations
              794 Roble Road
              Allentown, PA  18109

      [**] shall be made to T-Mobile within [**] of the date the outsourced
      vendor receives an [**].

      T-Mobile reserves the right to prosecute any employee or agent of StarTek
      that committed fraud against T-Mobile or a customer of T-Mobile.

23.   BILLABLE MINUTES: For purposes of this Agreement, "Billable Minutes " is
      defined as:

      23.1. [**] multiplied by the [**] when [**] forecast is delivered to
            StarTek.

      23.2. In the event where less than [**] is delivered to StarTek, amounts
            payable to StarTek shall be based upon the [**].

      23.3. During system downtime as a result of [**], amounts payable [**].
            Where actual AHT is unavailable [**], the lesser of [**] will be
            substituted.

      23.4. StarTek shall be paid [**] rate as listed in Section 25 for the
            actual minutes of processing downtime forms as detailed in the
            required ACD productivity reports displaying time in code and number
            of forms processed. .

      23.5. During system downtime as a result of a StarTek failure outside the
            definitions provided for in Section17.2, and StarTek is unable to
            accept the call volume T-Mobile is otherwise prepared to provide it,
            for the purposes of determining KPI penalties, StarTek will use the
            forecasted volume to determine service levels for those downtime
            intervals.

      23.6. Overtime will be calculated by interval using the following formula:
            interval handled call volume in excess of [**] multiplied by the
            lesser of [**] of the KPI AHT and interval AHT, and divided through
            by 60 to obtain the number of minutes. These are the billable OT
            minutes where T-Mobile USA has solicited and provided written
            approval of overtime.

24.   SERVICE LEVELS /BREACH OF SERVICE LEVELS. StarTek shall meet or exceed the
      Key Performance Indicator Service Levels as provided in Performance
      Pricing Matrix in Exhibit B. Performance outside of the neutral zone of
      the specified Key Performance Indicators will result in
      increases/deductions to the overall price per minute as provided in
      Exhibit B.

      24.1. In the event that StarTek negatively performs any of the Key
            Performance Indicators, in performance subject to deductions in
            payment/pricing (not neutral or bonus-able performance) as specified
            in Performance Price Matrix in Exhibit B, for a consecutive period
            of [**], StarTek shall be in breach of this Agreement. StarTek shall
            prepare a plan to cure the breach and shall have [**] from the date
            of the first date of failure in which to cure the breach. In the
            event that StarTek fails to cure the breach within the [**] period
            from the date of the first date of failure, T-Mobile may terminate
            the Agreement for StarTek's breach.

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25.   PRICING SCHEDULE. T-Mobile shall pay StarTek for Services as provided in
      the following schedule.

      25.1. INTERIM PRICING. Interim prices apply until such time StarTek meets
            service level for [**] from effective date of this agreement;
            however no later than [**].

          25.1.1. Standard Rate: [**]

          25.1.2. Holiday Rate: [**]

          25.1.3. Overtime Rate: [**]

          25.1.4. Standard Spanish Rate: [**]

          25.1.5. Holiday Spanish Rate: [**]

          25.1.6. Overtime Spanish Rate: [**]

      25.2. PREMIUM PRICING. Premium Pricing shall apply after StarTek performs
            as stated in Section 25.1 for [**]; however no later than [**].

          25.2.1. Standard Rate: [**]

          25.2.2. Holiday Rate: [**]

          25.2.3. Overtime Rate: [**]

          25.2.4. Standard Spanish Rate: [**]

          25.2.5. Holiday Spanish Rate: [**]

          25.2.6. Overtime Spanish Rate: [**]

      25.3. [**].

          25.3.1. [**]

          25.3.2. [**]

          25.3.3. [**]

          25.3.4. [**]

          25.3.5. [**]

          25.3.6. [**]

          25.3.7. [**]

          25.3.8. [**]

          25.3.9. [**]

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                                    EXHIBIT B

                * -- ALL FIGURES ON EXHIBIT B HAVE BEEN REDACTED
                                      [**]

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                                    EXHIBIT C

* -- ALL FIGURES ON EXHIBIT C HAVE BEEN REDACTED
[**]

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                                   EXHIBIT A-4

                            STATEMENT OF WORK - [**]

This Statement of Work, Exhibit A-6 is incorporated into that certain T-Mobile
USA Service Partner Services Agreement ("Agreement") dated August 1, 2005 by and
between T-Mobile USA, Inc. ("T-Mobile") and StarTek USA, Inc. ("StarTek"). The
Statement of Work shall be effective as of August 1, 2005 and the defined terms
used in this Statement of Work shall have the meanings provided in the Agreement
unless expressly defined herein.

1.    GENERAL. StarTek will handle [**] work for T-Mobile. StarTek will maintain
      a dedicated program (i.e., StarTek's dedicated representatives shall
      handle only T-Mobile work, StarTek's team supervisors shall support only
      T-Mobile dedicated representatives and StarTek's team managers will
      support only T-Mobile dedicated team supervisors.) to perform the
      Services.

2.    HOURS OF OPERATION. Except as otherwise set forth herein, the hours of
      operation will be:

            2.1.  [**]

            2.2.  [**]

            2.3.  Any change to the hours of operation on a T-Mobile line of
                  business at any site by StarTek requires written request and
                  approval by a Vice President of T-Mobile of the change. Any
                  change to the hours of operation on a T-Mobile line of
                  business at any site by T-Mobile requires written notification
                  to StarTek USA, Inc. Any closure of a site or 100%
                  reallocation of headcount to another site in which a T-Mobile
                  line of business resides requires written notice to T-Mobile
                  [**] in advance of the closure or reallocation. Any
                  reallocation of headcount (not due to forecast change) to
                  another site of more than 10% of the total line of business
                  headcount requires written to T-Mobile [**] in advance.
                  StarTek will provide a comprehensive written plan as to how
                  StarTek will maintain services for the line of business to
                  mitigate impact and prevent tangible and intangible cost to
                  T-Mobile.

3.    CALL VOLUME AND FORECASTING.

            3.1.  For the purposes of meeting the forecast, StarTek will utilize
                  full time equivalents ("FTEs") in accordance with this
                  Statement of Work. An FTE is defined as [**] Customer Facing
                  Employee [**]. An FTE is not equivalent to headcount.

            3.2.  FTEs will be classified into the following categories:

            3.2.1. Production FTE, which includes FTEs who are agents productive
                  to the line of business

            3.2.2. Training FTE, which includes FTEs who are currently in
                  training and not productive to the line of business

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            3.2.3. Get More Academy ("GMA") FTE, which includes FTEs who are
                  productive to the line of business at least part of their day,
                  but are still in training

            3.2.4. Leave of Absence ("LOA") FTE, which includes all FTEs who
                  cannot be classified into Production, Training, or GMA.

             3.3. T-Mobile will regularly prepare and deliver to StarTek the
                  following forecasts for the services to support the proper
                  planning of the infrastructure required to support the
                  programs:

            3.3.1. T-Mobile shall deliver a [**] rolling informational forecast
                  to StarTek on or before the 15th day of each month (the
                  "[**]"), which shall contain forecasted [**] call volumes.

            3.3.2. T-Mobile shall deliver a final forecast to the StarTek no
                  less than 45 days before the 1st day of each [**] for which
                  the forecast is made, which shall contain a [**] call volume
                  and Average Handle Time ("AHT") forecast by [**] interval (the
                  "Final Forecast"). The Final Forecast will contain an updated
                  [**] call volume and AHT forecasts, which will vary no more
                  than [**] in call volume each day from the [**]. If the Final
                  Forecast is not delivered in a timely fashion with respect to
                  a particular month, the appropriate [**] rolling informational
                  forecast shall be the Final Forecast for such [**].

            3.3.3. For informational purposes only, T-Mobile shall deliver a
                  [**] forecast.

             3.4. StarTek will provide to T-Mobile all assumptions used to
                  translate forecasts into scheduled FTE.

             3.5. T-Mobile and StarTek will mutually agree upon and participate
                  in the preparation of other work volume forecasts, as
                  reasonably required for the successful performance of the
                  Programs in this line of business. These may include, without
                  limitation, [**]. As part of the support structure, StarTek
                  will provide a National Resource Planning Analyst who will,
                  among other things, assist T-Mobile in the development of work
                  volume forecasts.

             3.6. StarTek will recruit, train, and staff to a minimum of [**] of
                  the forecasted FTE and be able to handle [**] of the
                  forecasted work volume. If the Final Forecast for a particular
                  [**] is [**] or more of the Final Forecast for the proceeding
                  [**], StarTek USA, Inc. may add additional staff to service
                  such increase with the prior consent of T-Mobile, which
                  consent shall not be unreasonably withheld.

             3.7. If the Production FTE count falls [**] below the forecasted
                  required FTE, StarTek will recruit and hire agents to
                  back-fill the attrition. The recruited agents must start
                  training within fourteen (14) days of exceeding threshold. The
                  associated training costs are the responsibility of the
                  StarTek and are not billable to T-Mobile.

             3.8. If the FTE requirement drops [**] T-Mobile will work with
                  StarTek in good faith to back-fill with additional business
                  [**] as StarTek ramps down to the

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                  required FTEs. T-Mobile and StarTek will mutually agree in
                  writing on the number of FTEs that will be included in the
                  ramp down.

4.    PRODUCTIVITY SPECIFIC TO WORKLOAD TYPE. T-Mobile and StarTek will agree on
      productivity measurements specific to the line of business.

5.    RAMP. Ramp is defined as any required FTE increase necessary to
      accommodate work volume growth of greater than [**] of the volume in the
      peak [**] of the prior [**].

6.    RAMP PLANS. For the purposes of this document a Ramp Plan is defined as a
      T-Mobile approved plan to add substantial FTEs to a current line of
      business or a change to the current line of business with substantial
      additions to current StarTek FTEs that support T-Mobile services. StarTek
      must submit written Ramp Plans to T-Mobile for written approval by a
      T-Mobile operations manager or above.

7.    TRAINING.

            7.1.  Agents will be trained on the T-Mobile standard New-Hire
                  Training Curriculum. Training for the program shall be in
                  accordance with the T-Mobile New Hire Training Curriculum.
                  Upon [**] written notice to StarTek, T-Mobile may change the
                  T-Mobile New Hire Training Curriculum and the hours required
                  for delivery. Prior to completion of training, T-Mobile will
                  deliver to StarTek all applicable application IDs. Sharing of
                  application IDs is prohibited under T-Mobile policy. StarTek
                  will establish procedures to prevent sharing of application
                  IDs. Any agent who violates this policy will be promptly
                  removed from the T-Mobile account.

            7.2.  Any new hire training conducted for net growth must be
                  approved in writing by a T-Mobile training manager or above.
                  Written approval must be attached to the invoice in order to
                  substantiate billable new hire training. T-Mobile will be kept
                  informed of all attrition training.

            7.3.  All agent-level training-period performance, including
                  attendance, quality, and assessment scores, regardless of
                  whether net growth or attrition-related, will be reported [**]
                  to [**] invoice.

            7.4.  The ratio of trainers to trainees is not to exceed a classroom
                  level of [**]. The [**] trainers can include a fully-certified
                  trainer with the support of a supervisor who has been through
                  a certified training course.

            7.5.  All costs and expenses for training and training materials for
                  new agents and any initial and program extension training, or
                  changes or modifications to the program or continuation
                  training that exceeds [**] shall be borne by [**]. Online
                  options must be used by StarTek in lieu of printed materials
                  wherever reasonably available. All written materials must be
                  reused by StarTek where reasonable. [**] will not reimburse
                  for training or training materials utilized for
                  attrition-related training. [**] shall not compensate [**] for
                  any agent who does not complete the training via graduation
                  from [**]. Documented training trackers must accompany all
                  invoices for approval of billed charges. Documentation must
                  contain as much

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                  information as allowed by law. Information required but not
                  limited to: Agent name, agent training start date, attendance
                  record, and assessment and quality scores. All Continuing
                  Education classes are to be tracked via auxiliary (AUX) or
                  automatic call distributor (ACD) code and submitted monthly
                  with reporting displaying agent's name, the exact amount of
                  time spent in each training course, the name of each training
                  course, and the total time in the month spent in Continuing
                  Education training. It is StarTeks responsibility to deliver
                  all appropriate training within the scheduled time frame,
                  subject to service level considerations.

            7.6.  STARTEK will schedule Streamline read time not to exceed the
                  amount of six (6) minutes per day, no more than thirty (30)
                  minutes per agent. Streamline read time must be measured via
                  ACD or AUX code, or via skill set, and reported monthly.
                  Streamline read time will be billed at the hourly continuing
                  education training rate and is subject to the [**] StarTek is
                  responsible for as referenced in section 7.5.

            7.7.  StarTek must not graduate any new hire agent from training/GMA
                  to production if the agent has missed more than 8 hours in the
                  training classroom, or 16 hours in GMA. The agent must return
                  to the classroom or GMA as applicable to make up missed time
                  before graduating to production. T-Mobile must receive written
                  documentation of the missed time and proof that the time has
                  been made up before being considered ready for production. New
                  agents must also pass training assessments at 85% or better
                  and score 2.6 or higher in quality reviews during GMA to
                  graduate from training to production.

            7.8.  [**] requests for removal of personnel, including, but not
                  limited to, new trainers and any associated materials, [**].

            7.9.  If StarTek is not meeting the quality standards set forth in
                  Section 14 below and it is determined by T-Mobile that
                  additional "skill set" training is required for the StarTek
                  representatives, [**] will bear the cost of the additional
                  training.

            7.10. T-Mobile curriculum is to be facilitated by Certified
                  Facilitators. Certification to be provided by StarTek. If the
                  StarTek does not have a certification course they will be
                  required to use the T-Mobile approved certification courses.
                  Facilitators are required to be certified by either T-Mobile
                  Learning and Development specialist or their own Certified
                  Training Manager. Non-certified Supervisors/Operations
                  Managers/Coaches or Team Leads cannot conduct New Hire
                  Training.

            7.11. StarTek will abide by the documented training guidelines.

8.    ESCALATION PROCEDURES. StarTek shall utilize T-Mobile-provided escalation
      processes, to handle calls beyond the agent's scope of training or for
      management support of a customer issue. This process will ensure that each
      call that cannot be handled by the agent is then handled by the lead
      representative up through the manager before being transferred to T-Mobile
      for resolution. If a customer requires

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      management support, the agent shall transfer the call to a manager.
      T-Mobile shall update all on-line job aides that define the escalation
      procedures for the program when any changes are made.

9.    [**]

            9.1.  [**]

10.   CUSTOMER CARE SYSTEMS. StarTek shall be responsible for costs associated
      with workstations and local area network (LAN) infrastructure equipped to
      run the most recent version of the [**] deployed at the time of the
      implementation of this Agreement. StarTek is hereby granted a license for
      the term of this Agreement to use the [**] for the sole purposes of
      performing its obligations under this Agreement. StarTek shall also
      provide the building, telecommunications switch for the Interactive Voice
      Response (IVR) system, remote monitoring application and associated toll
      free number, Universal Power Supply (UPS), desktop computers, office
      supplies, and dedicated workspaces in each call center. [**] shall be
      responsible for costs associated with wide area network (WAN)
      infrastructure (including, but not limited to, the WAN data connectivity
      infrastructure, application/database servers, routers, and related
      peripherals. [**] shall also be responsible for software required to
      support the [**]. T-Mobile will be responsible for the [**], Knowledge
      Database, and Call Tracking systems required to support the Services
      performed under this Agreement.

11.   SYSTEMS USE AND DOWNTIME. Information given to callers or collected by
      agents will be directly taken from and/or input into T-Mobile's systems.
      In the event that T-Mobile's systems go down, StarTek shall capture call
      information in Remedy, or on the downtime forms provided by T-Mobile and
      will be instructed on procedure in each scenario as applicable by
      T-Mobile. If paper forms are utilized, StarTek agrees that it shall then
      input information from these downtime forms once the system is restored.
      Turnaround commitment to enter downtime forms into T-Mobile's systems will
      be [**] from the time when T-Mobile's systems are restored. If call volume
      does not allow for [**] turnaround due to call volume meeting at least
      [**] of the forecasted volume, another [**] input period shall be granted.
      Downtime forms will be destroyed (burned or shredded) or sent to T-Mobile,
      as directed by T-Mobile, every [**]. StarTek will assign a special ACD
      tracking code to designate when specified representatives are entering
      downtime form information into System. StarTek shall provide a downtime
      productivity report to T-Mobile displaying time in code, number of
      downtime forms processed and occupancy rate. T-Mobile agrees to pay
      StarTek the [**] (contingent upon meeting [**] per rep to be agreed upon
      by both parties) for entering downtime information as stated in the
      Pricing Schedule set forth in Section 24 of this Statement of Work.

12.   OVERTIME.

            12.1. If the daily work volume will exceed the Final Forecast by
                  more than [**], StarTek will so notify T-Mobile and will
                  recruit trained agents to work overtime to support the work
                  handling. If the Final Forecast is within [**], StarTek must
                  recruit agents to work overtime to cover the shortage and
                  StarTek shall be responsible for any overtime expenses. Any
                  additional staffing required for call volume over [**] of
                  Final Forecast must be

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                  approved by T-Mobile in advance. T-Mobile will pay the
                  overtime rate for all approved overtime.

            12.2. The recruiting process for overtime shall be deployed as soon
                  as the circumstance affecting the call volume variance is
                  identified. If StarTek identifies the item at least [**]
                  before the occurrence, StarTek shall use its commercially
                  reasonable efforts to minimize the financial impact by
                  changing schedules to support the staffing required. StarTek
                  shall also recruit agents to work overtime on a [**] basis
                  when the [**] call volume dictates additional staffing needs
                  to maintain service goals.

            12.3. Except as provided in Section 12.2 above, StarTek shall obtain
                  written authorization from T-Mobile for any overtime that may
                  be required or incurred for the performance of the Programs.

            12.4. A reasonable estimate for the amount of overtime necessary to
                  meet the Service Level will be provided to T-Mobile for
                  written approval. Overtime need should be driven by [**] of
                  the forecast. Overtime resulting from staffing [**].

13.   SIGNIFICANT CHANGES. When significant changes occur to the processes
      utilized to provide services, T-Mobile has the right to request
      information related to compliance and execution of such changes.

14.   KPIS. [**]. All KPIs will be mutually agreed upon.

15.   REPORTS. T-Mobile and StarTek will mutually agree upon required reports
      and timelines by the completion of the consolidation of [**].

16.   MONITORING. T-Mobile shall have the right, to the extent permitted by law
      and at no additional expense, to monitor at any time (either on-site or
      remotely) customer contact calls and/or specific agents to ensure
      compliance with performance, operational and quality control standards.
      [**] must provide [**] with a remote monitoring solution. There are two
      quality monitoring options required: a [**] and a [**]. The [**]. would
      manage the [**] calls within [**] of being [**]. T-Mobile requires a
      minimum of [**] calls per agent per month [**]. [**] number must have the
      ability to monitor random calls as they come into the queue, or by
      locating specific agents [**].

      A.    HOLIDAYS. StarTek shall observe the following holiday schedule [**]
            T-Mobile shall compensate StarTek for holiday rates as identified in
            the Pricing Schedule set forth hereunder when applicable to the
            location where work is performed. Holiday rates apply to the actual
            holiday only.

                        [**]                        US HOLIDAYS
                        [**]                  New Year's Day (Jan 1)
                        [**]             Memorial Day (last Monday in May)
                        [**]                  Fourth of July (July 4)
                        [**]           Labor Day (first Monday in September)
                        [**]        Thanksgiving Day (4th Thursday in November)
                        [**]                  Christmas (December 25)

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17.   SYSTEM DOWNTIME; FORCE MAJEURE.

            17.1.In the event StarTek determines that system maintenance is
                  necessary, StarTek will notify T-Mobile of the need for such
                  maintenance [**] prior to the maintenance, and will obtain the
                  prior written approval of T-Mobile to schedule the time and
                  duration of such maintenance. All routine maintenance shall be
                  scheduled during off-peak system hours. In no event shall
                  interruption of Services for prior disclosed and approved
                  system maintenance constitute a failure of performance by
                  StarTek if performed in accordance with this Section 17.
                  StarTek shall promptly report to T-Mobile any StarTek system
                  failures, duration and impact.

            17.2. Except for T-Mobile's obligation to make payments for services
                  actually performed, each Party's failure to perform shall be
                  excused where such failure is a result of causes beyond its
                  reasonable control. Such causes shall include without
                  limitation acts of God, strikes, lockouts, riots, acts of war,
                  epidemics, governmental regulations imposed after the fact,
                  fire, communication line failures of third parties, vandalism,
                  power failures by third parties, cables cut by third parties,
                  earthquakes, floods or other similar catastrophes, terrorist
                  activities, failure of the T-Mobile system or the Internet not
                  related to StarTek's actions or inactions, any law, order,
                  regulation, direction, action or request of any governmental
                  entity or court or civil or military authority having
                  jurisdiction over either of the parties, national emergencies,
                  insurrections, riots, wars, strikes, lock outs, or work
                  stoppages. In the event of failures to perform for [**] or
                  more as a result of a force majeure, either Party may
                  terminate the Agreement by giving written notice to the other
                  Party. Any such notice of termination shall be effective upon
                  receipt.

            17.3.Notwithstanding the foregoing or anything in the Agreement to
                  the contrary, StarTek shall take commercially reasonable steps
                  to ensure that the Services shall continue without
                  interruption due to a StarTek systems failure during the term
                  of the Agreement by implementing [**] reasonably necessary to
                  provide the Services with an up-time of [**] (not including
                  scheduled maintenance), which shall include [**] and the like.
                  The components and execution of this plan must be reviewed,
                  updated, and tested semi-annually and results reported to
                  T-Mobile.

18.   ALLOCATION OF RESOURCES. T-Mobile acknowledges that upon the occurrence of
      a force majeure event or in instances of unusually high demand, demands on
      StarTek's facilities may exceed such facilities available capacity. In any
      such instance, StarTek shall, upon written notice to T-Mobile, be entitled
      to equitably prioritize Services and otherwise curtail utilization of its
      facilities in a manner so that any degradation to the Services provided to
      T-Mobile is (unless agreed otherwise by T-Mobile in writing) no greater
      than the level of degradation experienced by StarTek's other customers.
      Upon the request of T-Mobile, StarTek shall provide T-Mobile with
      reasonable evidence of its compliance with the foregoing.

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19.   RECRUITING REQUIREMENTS. StarTek recruiting efforts shall meet the
      following requirements in the selection process of all personnel hired to
      perform the T-Mobile services as described in this Agreement. T-Mobile
      reserves the right to audit the selection process.

            19.1. A mutually approved customer service assessment

            19.2. A behavioral interview

            [**]Background checks, which shall include criminal records, are
            required and shall be completed before employment. Costs incurred
            for background checks associated with such criminal records [**].

20.   STAFFING REQUIREMENTS. StarTek agrees to maintain the following staffing
      ratios: [**] StarTek agrees that all managers shall be full-time StarTek
      employees. Subject to Section 21.1 StarTek will ensure that each person
      assigned to a function has the necessary functional and T-Mobile-related
      training to successfully perform the function. StarTek must provide
      specific agent information up to what the law allows. Information required
      includes agent name, T-Mobile agent IDs, start date on T-Mobile line of
      business, assessment scores, termination date from T-Mobile line of
      business, quality average.

21.   All support functions such as StarTek quality, instructional analysts, and
      trainers must be housed within the site where the work is being performed
      unless otherwise agreed to in writing by T-Mobile.

            21.1.In addition, before a function is performed by an individual
                  assigned to that function, StarTek shall verify that the
                  necessary skills have been attained through the use of
                  certification of skills program. If T-Mobile reasonably
                  requests StarTek to remove any personnel performing Services
                  pursuant to this Agreement, StarTek shall promptly comply with
                  such request, within [**]. In support of this process, StarTek
                  will do the following:

            21.1.1. Team leaders/supervisors shall perform productive work for
                  at least [**] to maintain their skills. The remainder of their
                  time shall be used to support agent development, and to
                  otherwise assist StarTek employees to perform the Services.

            21.1.2. Quality Assurance specialists shall perform productive work
                  for at least [**] to maintain their skills.

            21.1.3. Managers, lead representatives, team leaders/supervisors and
                  trainers must be full-time employees of StarTek and must have
                  completed T-Mobile National Standard Curriculum Training.

            21.1.4. Supervisors will audit a mutually agreeable amount of agent
                  work per week for accuracy.

22.   FRAUD. StarTek shall implement and enforce T-Mobile policy and procedures
      as well as StarTek's own procedures to detect and prevent handset or
      credit card theft or other fraudulent activity by an employee or agent of
      StarTek. StarTek shall cooperate with any T-Mobile investigation into
      handset or credit card theft or other fraudulent

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      activity by an employee or agent of StarTek. If an employee or agent of
      StarTek is suspected of committing handset or credit card theft or other
      fraudulent activity against T-Mobile, StarTek will promptly notify
      T-Mobile of the suspected fraudulent activity and will provide T-Mobile
      with information necessary to conduct an investigation, including but not
      limited to the employee name, address, contact information, social
      security number, emergency contact address and phone numbers, and any
      other information that will assist in investigation of the suspected
      fraudulent activity. This information will be provided to T-Mobile within
      48 hours of the request from T-Mobile.

      StarTek will assume all responsibility for handset theft, credit card
      theft or other fraudulent activity by an employee or agent of StarTek or
      their failure to follow T-Mobile policies and procedures. [**] to the
      following address:

               T-Mobile USA, Inc.
               Attn:  Kevin Golas, Sr. Manager of Investigations
               794 Roble Road
               Allentown, PA  18109

      [**] shall be made to T-Mobile within [45 days] of the date the outsourced
      vendor receives an [**].

      T-Mobile reserves the right to prosecute any employee or agent of StarTek
      who committed fraud against T-Mobile or a customer of T-Mobile.

23.   BILLABLE HOURS: For purposes of this Agreement, "Billable Hours" is
      defined as:

            23.1. Hours [**] to Activations Offline, which [**]

            23.2.[**] shall not exceed the [**] unless increased workload is
                  [**] and is [**] in writing.

24.   SERVICE LEVELS /BREACH OF SERVICE LEVELS. StarTek shall meet or exceed the
      Key Performance Indicator Service Levels as will be provided in accordance
      with Section 14.

25.   PRICING SCHEDULE. T-Mobile shall pay StarTek for Services as provided in
      the following schedule

            25.1. Interim Pricing. Interim prices apply until such time as [**].

            25.1.1. Tier [**]

            25.1.2. Tier [**]

            25.1.3. Tier [**]

            25.1.4. Overtime and Holiday Tier [**]

            25.1.5. Overtime and Holiday Tier [**]

            25.1.6. Overtime and Holiday Tier [**]

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               25.2. New Pricing. New prices apply after [**]

            25.2.1. Tier II RATE: $.51/ HANDLE MINUTE

            25.2.2. Tier [**]

            25.2.3. Tier [**]

            25.2.4. Overtime and Holiday Tier [**]

            25.2.5. Overtime and Holiday Tier [**]

            25.2.6. Overtime and Holiday Tier [**]

               25.3. Agent Training.

            25.3.1. [**]

            25.3.2. [**]

            25.3.3. [**]

            25.3.4. [**]

            25.3.5. [**]

            25.3.6. [**]

            25.3.7. [**]

            25.3.8. [**]

            25.3.9. [**]

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                                   EXHIBIT A-5

                            STATEMENT OF WORK - [**]

This Statement of Work, Exhibit A-5 is incorporated into that certain T-Mobile
USA Service Partner Services Agreement ("Agreement") dated August 1, 2005 by and
between T-Mobile USA, Inc. ("T-Mobile") and StarTek USA, Inc. ("StarTek"). The
Statement of Work shall be effective as of August 1, 2005 and the defined terms
used in this Statement of Work shall have the meanings provided in the Agreement
unless expressly defined herein.

1.    GENERAL. StarTek will handle inbound [**] calls for T-Mobile. StarTek will
      maintain a dedicated program (i.e., StarTek's dedicated representatives
      shall handle only T-Mobile calls, StarTek's team supervisors shall support
      only T-Mobile dedicated representatives and StarTek's team managers will
      support only T-Mobile dedicated team supervisors.) to perform the
      Services.

2.    HOURS OF OPERATION. Except as otherwise set forth herein, the hours of
      operation will be [**] Any change to the hours of operation on a T-Mobile
      line of business at any site by StarTek requires written request and
      approval by a T-Mobile Vice President of the change. Any change to the
      hours of operation on a T-Mobile line of business at any site by T-Mobile
      requires written notification to StarTek. Any closure of a site or 100%
      reallocation of headcount to another site in which a T-Mobile line of
      business resides requires written notice to T-Mobile [**] notice in
      advance of the closure or reallocation. Any reallocation of headcount (not
      due to forecast change) to another site of [**] of the total [**]
      headcount requires written advanced notice to T-Mobile [**] StarTek will
      provide a comprehensive written plan as to how StarTek will maintain
      services of line of business to mitigate impact and prevent tangible and
      intangible cost to T-Mobile

3.    CALL VOLUME AND FORECASTING.

      3.1.  For the purposes of meeting the forecast, StarTek will utilize full
            time equivalents ("FTEs") in accordance with this Statement of Work.
            An FTE is defined as [**] Customer Facing Employee [**]. An FTE is
            not equivalent to a headcount.

      3.2.  FTEs will be classified into the following categories:

            3.2.1. Production FTE, which includes FTEs who are agents productive
                  to the line of business

            3.2.2. Training FTE, which includes FTEs who are currently in
                  training and not productive to the line of business

            3.2.3. Get More Academy ("GMA") FTE, which includes FTEs who are
                  productive to the line of business at least part of their day,
                  but are still in training

            3.2.4. Leave of Absence ("LOA") FTE, which includes all FTEs who
                  cannot be classified into Production, Training, or GMA.

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      3.3.  T-Mobile will regularly prepare and deliver to StarTek the following
            forecasts for the services to support the proper planning of the
            infrastructure required to support the programs:

            3.3.1. T-Mobile shall deliver a [**] rolling informational forecast
                  to StarTek on or before the 15th day of each month (the
                  "[**]"), which shall contain forecasted [**] call volumes.

            3.3.2. T-Mobile shall deliver a final forecast to StarTek no less
                  than 45 days before the 1st day of each [**] for which the
                  forecast is made, which shall contain a [**] call volume and
                  Average Handle Time ("AHT") forecast by [**] interval (the
                  "Final Forecast"). The Final Forecast will contain an updated
                  [**] call volume and AHT forecasts, which will vary no more
                  than [**] in call volume each day from the [**]. If the Final
                  Forecast is not delivered in a timely fashion with respect to
                  a particular month, the appropriate [**] rolling informational
                  forecast shall be the Final Forecast for such [**].

            3.3.3. For informational purposes only, T-Mobile shall deliver a
                  [**] forecast.

      3.4.  StarTek will use [**] call volume forecasts provided by T-Mobile as
            the Final Forecast in accordance with this Agreement. This process
            is known as Interval Forecasting. StarTek will schedule the
            appropriate number of FTEs in [**] intervals to meet service levels
            outlined in the T-Mobile Final Forecast. This process is known as
            Interval Scheduling. StarTek will provide Interval Scheduling plans
            to T-Mobile as a [**] look ahead after receiving a Final Forecast
            from T-Mobile. These Interval Scheduling plans will illustrate how
            StarTek plans to meet the Key Performance Indicator (KPI) Service
            Level. The documented plans will include the number of required FTEs
            to meet the KPI Service Level, the number of scheduled agents, and
            the [**] Service Level Objectives.

      3.5.  StarTek will provide to T-Mobile USA all assumptions used to
            translate forecasts into scheduled FTEs.

      3.6.  T-Mobile and StarTek will cooperatively manage [**] schedule
            adjustments to manage actual call volumes.

      3.7.  T-Mobile and StarTek will mutually agree upon and participate in the
            preparation of other call volume forecasts, as reasonably required
            for the successful performance of the Programs. These may include,
            without limitation, [**]. As part of the support structure, StarTek
            will provide a National Resource Planning Analyst who will, among
            other things, assist T-Mobile in the development of call volume
            forecasts.

      3.8.  StarTek will recruit, train, and staff to a minimum of [**] of the
            forecasted FTE and be able to handle [**] of the forecasted call
            volume. If the Final Forecast for a particular [**] is [**] or more
            of the Final Forecast for the proceeding [**], StarTek may add
            additional staff to service such increase with the prior consent of
            T-Mobile, which consent shall not be unreasonably withheld.

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      3.9.  If the Production FTE count falls [**] the forecasted FTE, StarTek
            will recruit and hire agents to back-fill the attrition as long as
            T-Mobile is delivering a minimum of [**] of forecasted volume. The
            recruited agents must start training within [**] of exceeding
            threshold. [**].

      3.10. If the FTE requirement drops [**], T-Mobile will work with StarTek
            in good faith to back-fill with additional business [**] as StarTek
            ramps down to the required FTEs. T-Mobile and StarTek will mutually
            agree in writing on the number of FTEs that will be included in the
            ramp down.

      3.11. The forecasts referred to above shall in no way represent a
            commitment from T-Mobile to provide volumes to StarTek, except for
            purposes of amounts payable by T-Mobile to StarTek as provided in
            this Section 3.12.

      3.12. Amounts payable to StarTek hereunder and the KPI calculation shall
            be based upon the following:

            3.12.1. When the [**] exceeds [**] of Final Forecast, then StarTek
                  shall be paid for the [**].

            3.12.2. When the [**] is less than [**] of the Final Forecasted call
                  volume, and StarTek is staffed at no less than [**] of the
                  required Final Forecasted FTE, then StarTek shall be paid
                  according to the following formula: [**].

4.    AVERAGE HANDLE TIME. Average Handle Time ("AHT") is defined as the sum of
      average talk time; hold time while on a call, and after call work. Both
      parties will mutually agree upon an AHT goal within sixty (60) days of the
      conclusion of the initial ramp period

5.    RAMP. Ramp is defined as any required FTE increase necessary to
      accommodate call volume growth of greater than [**] of the volume in the
      peak week of the prior [**].

6.    RAMP PLANS. For the purposes of this document a Ramp Plan is defined as a
      T-Mobile approved plan to add substantial FTEs to a current line of
      business or a change to the current line of business with substantial
      additions to current StarTek FTEs that support T-Mobile services. StarTek
      must submit written Ramp Plans to T-Mobile for written approval by a
      T-Mobile operations manager or above.

      6.1.  In the event of a new ramp plan or a change to the [**]line of
            business supported by StarTek, the AHT monthly objectives will be
            adjusted depending upon the percentage of net growth in training FTE
            graduates to the maximum headcount during the growth period. The
            embedded MS Excel worksheet is an example of the adjustments and
            will be subject to the AHT objectives agreed to as set forth in
            Section 4 A printed example is shown in Exhibit C.

7.    TRAINING.

      7.1.  Agents will be trained on the standard T-Mobile New Hire Training
            Curriculum. Training for the program shall be conducted in
            accordance with the T-Mobile New Hire Training Curriculum. Upon [**]
            written notice to StarTek, T-Mobile may change the T-Mobile New Hire
            Training Curriculum and the hours required for delivery. Prior to
            completion of training, T-Mobile will deliver all applicable
            application IDs. Sharing of application IDs is prohibited under
            T-Mobile policy.

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            StarTek will establish procedures to prevent sharing of application
            IDs. Any agent who violates this policy will be promptly removed
            from the T-Mobile account.

      7.2.  Any new hire training conducted for net growth must be approved in
            writing by a T-Mobile training manager or above. Written approval
            must be attached to the invoice in order to substantiate billable
            new hire training. T-Mobile will be kept informed of all attrition
            during the training period.

      7.3.  The ratio of trainers to trainees is not to exceed a classroom level
            of [**] The two trainers can include a fully certified trainer with
            the support of a supervisor who has been through a certified
            training program.

      7.4.  All costs and expenses for training and training materials for new
            agents and any initial and program extension training, or changes or
            modifications to the program or continuation training that exceeds
            [**] shall be borne by [**]. Online options must be used [**] in
            lieu of printed materials wherever reasonably available. All written
            materials must be reused by StarTek where reasonable. [**] will not
            reimburse for training or training materials utilized for
            attrition-related training. [**] shall not compensate [**] for any
            agent who does not complete the training and graduate from [**].
            Documented training trackers must accompany all invoices for
            approval of billed charges. Documentation must contain as much
            information as allowed by law. Information required by not limited
            to: Agent name, agent training start date, attendance record, and
            assessment and quality scores. All Continuing Education classes are
            to be tracked via auxiliary (AUX) or automatic call distributor
            (ACD) code and submitted monthly with reporting displaying agent's
            name, the exact amount of time spent in each training course, the
            name of each training course, and the total time in the month spent
            in Continuing Education training. It is StarTek's responsibility to
            deliver all appropriate training within the scheduled time frame,
            subject to service level considerations.

      7.5.  StarTek will schedule StreamLine read time not to exceed the amount
            of six (6) minutes per day, no more than thirty (30) minutes per
            agent per week. Streamline read time must be measured via ACD or AUX
            code, or skill set, and reported monthly. Streamline read time will
            be billed at the hourly continuing education training rate and is
            subject to the[**]StarTek is responsible for as referenced in
            Section 7.4.

      7.6.  StarTek must not graduate any new hire agent from training/GMA to
            production if the agent has missed more than 8 hours in the training
            classroom16 hours in GMA. The agent must return to the classroom or
            GMA as applicable to make up missed time before graduating to
            production. T-Mobile must receive written documentation of the
            missed time and proof that the time has been made up before being
            considered ready for production. New agents must also pass training
            assessments at 85% or better and score 2.6 or higher in quality
            during GMA to graduate from training to production.

      7.7.  [**] requests for removal of personnel including, but not limited
            to, new trainers and any associated materials, [**].

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      7.8.  If StarTek is not meeting the quality standards set forth in Section
            14.3 below and it is determined by T-Mobile that additional "skill
            set" training is required for StarTek representatives, [**] will
            bear the cost of the additional training.

      7.9.  T-Mobile curriculum is to be facilitated by Certified Facilitators.
            T-Mobile Certification to be provided by StarTek. If StarTek does
            not have a certification course they will be required to use the
            T-Mobile certification course. Facilitators are required to be
            certified by either T-Mobile Learning and Development specialist or
            their own Certified Training Manager. Uncertified
            Supervisors/Operations Managers/Coaches or Team Leads cannot conduct
            new Hire training.

      7.10. StarTek will abide by the documented training guidelines. Any
            changes to the documented training guidelines by T-Mobile must be
            provided to StarTek no less than [**] prior to implementation. Any
            changes materially impacting StarTek's cost must be agreed to by
            both parties.

8.    ESCALATION PROCEDURES. StarTek shall utilize T-Mobile-provided escalation
      processes, to handle calls beyond the agent's scope of training or for
      management support of a customer issue. This process will ensure that each
      call that cannot be handled by the agent is then handled by the lead
      representative up through the manager before being transferred to T-Mobile
      for resolution. If a customer requires management support, the agent shall
      transfer the call to a manager. T-Mobile shall update all on-line job
      aides that define the escalation procedures for the program when any
      changes are made.

9.    [**].

      9.1.  [**].

10.   CUSTOMER CARE SYSTEMS. StarTek shall be responsible for costs associated
      with workstations and local area network (LAN) infrastructure equipped to
      run the most recent version of the [**] deployed at the time of the
      implementation of this Agreement. StarTek is hereby granted a license for
      the term of this Agreement to use the [**] for the sole purposes of
      performing its obligations under this Agreement. StarTek shall also
      provide the building and telecommunications switch for the Interactive
      Voice Response (IVR) system, remote monitoring application and associated
      toll free number, Universal Power Supply (UPS), desktop computers, office
      supplies, and dedicated workspaces in each call center. [**] shall be
      responsible for costs associated with wide area network (WAN)
      infrastructure (including, but not limited to, the WAN data connectivity
      infrastructure, application/database servers, routers, and related
      peripherals. [**] shall also be responsible for software required to
      support the [**]. T-Mobile will be responsible for the [**], Knowledge
      Database, and Call Tracking systems required to support the Services
      performed under this Agreement.

11.   SYSTEMS USE AND DOWNTIME. Information given to callers or collected by
      agents will be directly taken from and/or input into T-Mobile's systems.
      In the event that T-Mobile's systems go down, StarTek shall capture call
      information in Remedy, or on the downtime forms provided by T-Mobile.
      StarTek will be instructed on procedures

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      in each scenario as applicable by T-Mobile. If paper forms are utilized,
      StarTek agrees that it shall then input information from these downtime
      forms once the system is restored. Turnaround commitment to enter downtime
      forms into T-Mobile's systems will be [**] from the time when T-Mobile's
      systems are restored. If call volume does not allow for [**] turnaround
      due to call volume meeting at least [**] of the forecasted volume, another
      [**] input period shall be granted. Downtime forms will be destroyed
      (shredded or burned) or sent to T-Mobile, as directed by T-Mobile, every
      [**]. StarTek will assign a special ACD tracking code to designate when
      specified representatives are entering downtime form information into
      T-Mobile systems. StarTek shall provide a downtime productivity report to
      T-Mobile displaying time in code, number of downtime forms processed and
      occupancy rate. T-Mobile agrees to pay StarTek [**] (contingent upon
      meeting [**] per agent to be agreed upon by both parties) for entering
      downtime information as stated in the Pricing Schedule set forth in
      Section 24 of this Statement of Work.

12.   OVERTIME.

      12.1. If the call volume exceeds the Final Forecast by more than [**],
            StarTek will so notify T-Mobile and will recruit trained agents to
            work overtime to support the call handling. Any overtime in excess
            of [**] of Final Forecasted volume must be authorized by T-Mobile
            operations manager or above. For T-Mobile authorized overtime
            T-Mobile will pay the overtime rate set forth in Section 25 for all
            volume handled in excess of [**] of the Final Forecast. The billable
            overtime minutes will be calculated as set forth in Section 12.4.

      12.2. The recruiting process for overtime shall be deployed as soon as the
            circumstance affecting the call volume variance is identified. If
            StarTek identifies the item at least [**] before the occurrence,
            StarTek shall use its commercially reasonable efforts to minimize
            the financial impact by changing schedules to support the staffing
            required. StarTek shall also recruit agents to work overtime on a
            [**] basis when the [**] call volume dictates additional staffing
            needs to maintain service goals.

      12.3. Except as provided above in Section 12.2, StarTek shall obtain
            written authorization from T-Mobile for any overtime that may be
            required or incurred for the performance of the Programs.

      12.4. T-Mobile authorized overtime as defined in section 12.1 will be
            calculated for purposed of invoice payment by multiplying the
            handled call volume in excess of [**] of Final Forecast by the [**],
            and dividing through by 60 to get minutes.

13.   SIGNIFICANT CHANGES. When significant changes occur to the processes
      utilized to provide services, T-Mobile has the right to request
      information related to compliance and execution of such changes.

14.   KPI'S. The KPI's for Services performed hereunder shall be effective for
      purposes of bonus/penalty adjustments to the invoice as set forth in
      Exhibit B, as of sixty (60) days following the completion of the initial
      ramp period.

      14.1. Service Level. Inbound [**] customer service calls: [**]

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      14.2. Call Volume. [**.]

      14.3. Call Quality. According to the results from the call quality
            observation process, as described below, with a minimum score of
            [**].

            14.3.1. For the purposes of ensuring Call Quality, StarTek and
                  T-Mobile shall measure the agents' call quality using the
                  following types of observations:

                  14.3.1.1. T-Mobile observation

                  14.3.1.2. StarTek operations observation (4 per agent/month);

                  14.3.1.3. StarTek quality observation (4 per agent/month)

            14.3.2. KPI performance is based upon T-Mobile scores only, whereas
                  the function of the StarTek operations and quality
                  observations is to provide immediate and monthly feedback to
                  agents and StarTek management.

            14.3.3. For the purposes of billing, the scores for all of these
                  observations will be [**] The StarTek operations and StarTek
                  quality observations must each be [**]. If either the StarTek
                  operations or the StarTek quality observation is not [**]
                  T-Mobile may provide written approval of exception to this
                  section 14.3.3 given the number of outsourced issue tickets on
                  T-Mobile observations.

            14.3.4. Calibration. StarTek operations managers shall attend the
                  monthly T-Mobile calibration sessions for the line of
                  business.

            14.3.5. The call quality observation form to be used in this process
                  shall be provided by T-Mobile. Results shall be used to
                  provide both immediate and monthly feedback to agents and
                  StarTek management. StarTek will make best effort to provide
                  each agent with feedback/coaching within 24 hours of being
                  monitored by T-Mobile, StarTek quality team or StarTek
                  operations. StarTek shall keep written documentation of each
                  agent session, signed by the agent, and available for review
                  by T-Mobile upon request. The call quality scoring criteria
                  used by StarTek will match that used by T-Mobile. StarTek must
                  achieve a minimum voice quality score [**] Call monitoring
                  feedback sessions will be held between the agent and the
                  agent's direct supervisor. Any monitored calls using profanity
                  or customer abuse as determined by T-Mobile will result in
                  immediate, unchallenged agent termination from the T-Mobile
                  program.

      14.4.

      14.5.

      14.6. Credit and Adjustments. StarTek shall [**] accuracy audits

15.   REPORTS. StarTek shall provide T-Mobile with standard call count reports
      and performance reports on a [**] basis [**] by [**] for the previous [**]
      by [**] for the previous [**], and [**] by [**] for the previous [**]. The
      reports shall be in the format and contain the information mutually agreed
      upon between StarTek and T-Mobile. StarTek shall provide report cards
      reflecting measurements of the KPIs and all of the above metrics within
      [**] of each [**]. All reporting fed by data from the

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      switch is considered standard and is not subject to non-standard report
      development costs. Hourly lines of business must have agent detail payroll
      reports to substantiate that billable hours do not exceed actual hours
      worked. T-Mobile and StarTek shall mutually agree upon any other reports
      and the cost associated with the development of those reports. T-Mobile
      agrees to follow the change management process defined by StarTek and
      agreed to by T-Mobile when requesting changes to reports or additional
      information. If T-Mobile requires material format changes to T-Mobile
      standard reports, T-Mobile will be required to compensate StarTek for the
      development costs, based upon the rate outlined in the Pricing Schedule
      set forth in Section 25 of this Statement of Work and will be [**] prior
      to invoicing.

16.   MONITORING. T-Mobile shall have the right, to the extent permitted by law
      and at no additional expense, to monitor at any time (either on-site or
      remotely) customer contact calls and/or specific agents to ensure
      compliance with performance, operational and quality control standards.
      [**] must provide [**] with a remote monitoring solution. There are two
      quality monitoring options required: a [**] and a [**]. [**] would manage
      the [**] calls within [**] of being [**]. [**] requires a minimum of [**]
      calls per agent per month [**]. [**] must have the ability to monitor
      random calls as they come into the queue, or by locating specific agents
      [**].

      A.    HOLIDAYS. StarTek shall observe the following holiday schedule [**].
            T-Mobile shall compensate StarTek for holiday rates as identified in
            the Pricing Schedule set forth hereunder when applicable to the
            location where work is performed. Holiday rates apply to the actual
            holiday only.

                        [**]                        US HOLIDAYS
                        [**]                  New Year's Day (Jan 1)
                        [**]             Memorial Day (last Monday in May)
                        [**]                  Fourth of July (July 4)
                        [**]           Labor Day (first Monday in September)
                        [**]        Thanksgiving Day (4th Thursday in November)
                        [**]                  Christmas (December 25)

17.   SYSTEM DOWNTIME; FORCE MAJEURE.

      17.1.In the event StarTek determines that system maintenance is necessary,
            StarTek will notify T-Mobile of the need for such maintenance [**]
            prior to the maintenance, and will obtain the prior written approval
            of T-Mobile to schedule the time and duration of such maintenance.
            All routine maintenance shall be scheduled during off-peak system
            hours. In no event shall disclosed and approved interruption of
            Services for system maintenance constitute a failure of performance
            by StarTek if performed in accordance with this Section 17. StarTek
            shall promptly report to T-Mobile any StarTek system failures,
            including the duration and impact.

      17.2. Except for T-Mobile's obligation to make payments for services
            actually performed, each Party's failure to perform shall be excused
            where such failure is a result of causes beyond its reasonable
            control. Such causes shall include

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            without limitation acts of God, strikes, lockouts, riots, acts of
            war, epidemics, governmental regulations imposed after the fact,
            fire, communication line failures of third parties, vandalism, power
            failures by third parties, cables cut by third parties, earthquakes,
            floods or other similar catastrophes, terrorist activities, failure
            of the T-Mobile system or the Internet not related to StarTek's
            actions or inactions, any law, order, regulation, direction, action
            or request of any governmental entity or court or civil or military
            authority having jurisdiction over either of the parties, national
            emergencies, insurrections, riots, wars, strikes, lock outs, or work
            stoppages. In the event of failures to perform for [**] or more as a
            result of a force majeure, either Party may terminate the Agreement
            by giving written notice to the other Party. Any such notice of
            termination shall be effective upon receipt.

      17.3.Notwithstanding the foregoing or anything in the Agreement to the
            contrary, StarTek shall take commercially reasonable steps to ensure
            that the Services shall continue without interruption due to StarTek
            systems failure during the term of the Agreement by implementing
            [**] reasonably necessary to provide the Services with an up-time of
            [**] (not including scheduled maintenance), which shall include [**]
            and the like. The components and execution of this plan must be
            reviewed, updated, and tested semi annually and results reported to
            T-Mobile.

      17.4. Where downtime is a result of [**]

      17.5. Where downtime is a result of [**]

18.   ALLOCATION OF RESOURCES. T-Mobile acknowledges that upon the occurrence of
      a force majeure event or in instances of unusually high demand, demands on
      StarTek's facilities may exceed such facilities available capacity. In any
      such instance, StarTek shall, upon written notice to T-Mobile, be entitled
      to equitably prioritize Services and otherwise curtail utilization of its
      facilities in a manner so that any degradation to the Services provided to
      T-Mobile is (unless agreed otherwise by T-Mobile in writing) no greater
      than the level of degradation experienced by StarTek's other customers.
      Upon the request of T-Mobile, StarTek shall provide T-Mobile with
      reasonable evidence of its compliance with the foregoing.

19.   RECRUITING REQUIREMENTS. StarTek recruiting efforts shall meet the
      following requirements in the selection process of all personnel hired to
      perform the T-Mobile USA services as describe in this SOW. T-Mobile
      reserves the right to audit the selection process.

      19.1. A mutually approved customer service assessment

      19.2. A behavioral interview

      19.3.Background checks, which shall include criminal records, are required
            and shall be completed before employment. Costs incurred for
            background checks associated with such criminal records [**].

20.   STAFFING REQUIREMENTS. StarTek agrees to maintain the following staffing
      ratios: [**] StarTek agrees that all managers shall be full-time StarTek
      employees. Subject to Section 21.1, StarTek will ensure that each person
      assigned to a function has the

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      necessary functional and T-Mobile-related training to successfully perform
      the function. StarTek must provide specific agent information up to what
      the law allows. Information required includes agent name, agent ID, start
      date on T-Mobile line of business, assessment scores, termination date
      from T-Mobile line of business, quality average.

21.   All support functions such as StarTek quality, instructional analysts, and
      trainers must be housed within the site where the work for this line of
      service is being performed unless otherwise agreed to in writing by
      T-Mobile.

      21.1.In addition, before a function is performed by an individual assigned
            to that function, StarTek shall verify that the necessary skills
            have been attained through the use of certification of skills
            program. If T-Mobile reasonably requests StarTek to remove any
            personnel performing Services pursuant to this Agreement, StarTek
            shall promptly comply with such request, within [**]. In support of
            this process, StarTek will do the following:

            21.1.1. Team leaders/supervisors shall go on-line to support
                  customer calls each week for at least [**] (approximately
                  [**]) to maintain their skills. The remainder of their time
                  shall be used to support agent development, and to otherwise
                  assist StarTek employees to perform the Services.

            21.1.2. Quality Assurance specialists shall go on-line to support
                  customer calls each [**] for at least [**] (approximately
                  [**]) to maintain their skills.

            21.1.3. Managers, lead representatives, team leaders/supervisors and
                  trainers must be full-time employees of StarTek and must have
                  completed T-Mobile National Standard Curriculum Training.

            21.1.4. Supervisors will monitor a minimum of two (2) calls per
                  agent per week.

22.   FRAUD. StarTek shall implement and enforce T-Mobile policies and
      procedures as well as StarTek's own procedures to detect and prevent
      handset or credit card theft or other fraudulent activity by an employee
      or agent of StarTek. StarTek shall cooperate with any T-Mobile
      investigation into handset or credit card theft or other fraudulent
      activity by an employee or agent of StarTek. If an employee or agent of
      StarTek is suspected of committing handset or credit card theft or other
      fraudulent activity against T-Mobile, StarTek will promptly notify
      T-Mobile of the suspected fraudulent activity and will provide T-Mobile
      with information necessary to conduct an investigation, including but not
      limited to the employee name, address, contact information, social
      security number, emergency contact address and phone numbers, and any
      other information that will assist in investigation of the suspected
      fraudulent activity. This information will be provided to T-Mobile within
      48 hours of the request from T-Mobile.

      StarTek will assume all responsibility for handset theft, credit card
      theft or other fraudulent activity by an employee or agent of StarTek or
      their failure to follow T-Mobile policies and procedures. [**] the
      following address:

            T-Mobile USA, Inc.
            Attn:  Kevin Golas, Sr. Manager of Investigations

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            794 Roble Road
            Allentown, PA  18109

      [**] shall be made to T-Mobile within [**] of the date the outsourced
      vendor receives an [**].

      T-Mobile reserves the right to prosecute any employee or agent of StarTek
      that committed fraud against T-Mobile or a customer of T-Mobile.

23.   BILLABLE MINUTES: For purposes of this Agreement, "Billable Minutes " is
      defined as:

      23.1. [**] multiplied by the [**] when [**] is delivered to StarTek.

      23.2.In the event where less than [**] is delivered to StarTek, amounts
            payable to StarTek shall be based upon [**].

      23.3.During system downtime as a result of a [**], amounts payable [**].
            Where actual AHT is unavailable [**], the lesser of [**] will be
            substituted.

      23.4.StarTek shall be paid [**] rate as listed in Section 25 for the
            actual minutes of processing downtime forms as detailed in the
            required ACD productivity reports displaying time in code and number
            of forms processed. .

      23.5.During system downtime as a result of a StarTek failure outside the
            definitions provided for in Section 17.2, and StarTek is unable to
            accept the call volume T-Mobile is otherwise prepared to provide it,
            for the purposes of determining KPI penalties, StarTek will use the
            forecasted volume to determine service levels for those downtime
            intervals.

      23.6.Overtime will be calculated by interval using the following formula:
            interval handled call volume in excess of [**] multiplied by the
            lesser of [**] of the KPI AHT and interval AHT, and divided through
            by 60 to obtain the number of minutes. These are the billable OT
            minutes where T-Mobile USA has solicited and provided written
            approval of overtime.

24.   SERVICE LEVELS /BREACH OF SERVICE LEVELS. StarTek shall meet or exceed the
      Key Performance Indicator Service Levels as provided in Performance
      Pricing Matrix in Exhibit B. Performance outside of the neutral zone of
      the specified Key Performance Indicators will result in
      increases/deductions to the overall price per minute as provided in
      Exhibit B.

      24.1.In the event that StarTek negatively performs any of the Key
            Performance Indicators, in performance subject to deductions in
            payment/pricing (not neutral or bonus-able performance) as specified
            in Performance Price Matrix in Exhibit B, for a consecutive period
            of [**], StarTek shall be in breach of this Agreement. StarTek shall
            prepare a plan to cure the breach and shall have [**] from the date
            of the first date of failure in which to cure the breach. In the
            event that StarTek fails to cure the breach within the [**] from the
            date of the first date of failure, T-Mobile may terminate the
            Agreement for StarTek's breach.

25.   PRICING SCHEDULE. T-Mobile shall pay StarTek for Services as provided in
      the following schedule. Interim prices apply until[ **] following the
      initial ramp period.

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      Penalty and Bonus Matrix (KPIs) shall apply [**] following the initial
      ramp period and the premium pricing goes into effect.

      25.1.INTERIM PRICING. Interim Pricing shall apply until [**] following the
            conclusion of the initial ramp period

            25.1.1. Standard Rate: [**]

            25.1.2. Holiday Rate: [**]

            25.1.3. Overtime Rate: [**]

      25.2.PREMIUM PRICING. Premium Pricing shall apply as of [**] following the
            conclusion of the initial ramp period.

            25.2.1. Standard Rate: [**]

            25.2.2. Holiday Rate: [**]

            25.2.3. Overtime Rate: [**]

      25.3. [**.]

            25.3.1. [**]

            25.3.2. [**]

            25.3.3. [**]

            25.3.4. [**]

            25.3.5. [**]

            25.3.6. [**]

            25.3.7. [**]

            25.3.8. [**]

            25.3.9. [**]

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                                 EXHIBIT B [**]

                * -- ALL FIGURES ON EXHIBIT B HAVE BEEN REDACTED
                                      [**]

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                                    EXHIBIT C

                * -- ALL FIGURES ON EXHIBIT B HAVE BEEN REDACTED
                                      [**]

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                                   EXHIBIT A-6

                            STATEMENT OF WORK - [**]

This Statement of Work, Exhibit A-6 is incorporated into that certain T-Mobile
USA Service Partner Services Agreement ("Agreement") dated August 1, 2005 by and
between T-Mobile USA, Inc. ("T-Mobile") and StarTek USA, Inc. ("StarTek"). The
Statement of Work shall be effective as of August 1, 2005 and the defined terms
used in this Statement of Work shall have the meanings provided in the Agreement
unless expressly defined herein.

1.    GENERAL. StarTek will handle [**] work for T-Mobile. StarTek will maintain
      a dedicated program (i.e., StarTek's dedicated representatives shall
      handle only T-Mobile work, StarTek's team supervisors shall support only
      T-Mobile dedicated representatives and StarTek's team managers will
      support only T-Mobile dedicated team supervisors) to perform the Services.

2.    HOURS OF OPERATION. Except as otherwise set forth herein, the hours of
      operation will be [**]. Any change to the hours of operation on a T-Mobile
      line of business at any site by StarTek requires written request and
      approval by a Vice President of T-Mobile of the change. Any change to the
      hours of operation on a T-Mobile line of business at any site by T-Mobile
      requires written notification to StarTek. Any closure of a site or 100%
      reallocation of headcount to another site in which a T-Mobile line of
      business resides requires written notice to T-Mobile [**] in advance of
      the closure or reallocation. Any reallocation of headcount (not due to
      forecast change) to another site [**] of the total line of business
      headcount requires written to T-Mobile [**] in advance. StarTek will
      provide a comprehensive written plan as to how StarTek will maintain
      services for the line of business to mitigate impact and prevent tangible
      and intangible cost to T-Mobile.

3.    CALL VOLUME AND FORECASTING.

      3.1.  For the purposes of meeting the forecast, StarTek will utilize full
            time equivalents ("FTEs") in accordance with this Statement of Work.
            An FTE is defined as [**] Customer Facing Employee [**]. An FTE is
            not equivalent to headcount.

      3.2.  FTEs will be classified into the following categories:

            3.2.1. Production FTE, which includes FTEs who are agents productive
                  to the line of business

            3.2.2. Training FTE, which includes FTEs who are currently in
                  training and not productive to the line of business

            3.2.3. Get More Academy ("GMA") FTE, which includes FTEs who are
                  productive to the line of business at least part of their day,
                  but are still in training

            3.2.4. Leave of Absence ("LOA") FTE, which includes all FTEs who
                  cannot be classified into Production, Training, or GMA.

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      3.3.  T-Mobile will regularly prepare and deliver to StarTek the following
            forecasts for the services to support the proper planning of the
            infrastructure required to support the programs:

            3.3.1. T-Mobile shall deliver a [**] rolling informational forecast
                  to StarTek on or before the 15th day of each month (the [**]),
                  which shall contain forecasted [**] call volumes.

            3.3.2. T-Mobile shall deliver a final forecast to the StarTek no
                  less than 45 days before the 1st day of each [**] for which
                  the forecast is made, which shall contain a [**] call volume
                  and Average Handle Time ("AHT") forecast by [**] interval (the
                  "Final Forecast"). The Final Forecast will contain an updated
                  [**] volume and AHT forecasts, which will vary no more than
                  [**] in call volume each day from the [**]. If the Final
                  Forecast is not delivered in a timely fashion with respect to
                  a particular month, the appropriate [**] rolling informational
                  forecast shall be the Final Forecast for such [**].

            3.3.3. For informational purposes only, T-Mobile shall deliver a
                  [**] forecast.

      3.4.  StarTek will provide to T-Mobile all assumptions used to translate
            forecasts into scheduled FTE.

      3.5.  T-Mobile and StarTek will mutually agree upon and participate in the
            preparation of other work volume forecasts, as reasonably required
            for the successful performance of the Programs in this line of
            business. These may include, without limitation, [**]. As part of
            the support structure, StarTek will provide a National Resource
            Planning Analyst who will, among other things, assist T-Mobile in
            the development of work volume forecasts.

      3.6.  StarTek will recruit, train, and staff to a minimum of [**] of the
            forecasted FTE and be able to handle [**] of the forecasted work
            volume. If the Final Forecast for a particular [**] is [**] or more
            of the Final Forecast for the proceeding [**], StarTek may add
            additional staff to service such increase with the prior consent of
            T-Mobile, which consent shall not be unreasonably withheld.

      3.7.  If the Production FTE count falls [**] below the forecasted FTE,
            StarTek will recruit and hire agents to back-fill the attrition. The
            recruited agents must start training within fourteen (14) days of
            exceeding threshold. The associated training costs are the
            responsibility of the StarTek and are not billable to T-Mobile.

      3.8.  If the FTE requirement drops [**] T-Mobile will work with StarTek in
            good faith to back-fill with additional business [**] as StarTek
            ramps down to the required FTEs. T-Mobile and StarTek will mutually
            agree in writing on the number of FTEs that will be included in the
            ramp down.

4.    PRODUCTIVITY SPECIFIC TO WORKLOAD TYPE. T-Mobile and StarTek will agree on
      productivity measurements specific to the line of business.

5.    RAMP. Ramp is defined as any required FTE increase necessary to accomodate
      work volume growth of greater than [**] of the volume in the peak [**] of
      the prior [**].

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6.    RAMP PLANS. For the purposes of this document a Ramp Plan is defined as a
      T-Mobile approved plan to add substantial FTEs to a current line of
      business or a change to the current line of business with substantial
      additions to current StarTek FTEs that support T-Mobile services. StarTek
      must submit written Ramp Plans to T-Mobile for written approval by a
      T-Mobile operations manager or above.

7.    TRAINING.

      7.1.  Agents will be trained on the T-Mobile standard New-Hire Training
            Curriculum. Training for the program shall be in accordance with the
            T-Mobile New Hire Training Curriculum. Upon [**] written notice to
            StarTek, T-Mobile may change the T-Mobile New Hire Training
            Curriculum and the hours required for delivery. Prior to completion
            of training, T-Mobile will deliver to StarTek all applicable
            application IDs. Sharing of application IDs is prohibited under
            T-Mobile policy. StarTek will establish procedures to prevent
            sharing of application IDs. Any agent who violates this policy will
            be promptly removed from the T-Mobile account.

      7.2.  Any new hire training conducted for net growth must be approved in
            writing by a T-Mobile training manager or above. Written approval
            must be attached to the invoice in order to substantiate billable
            new hire training. T-Mobile will be kept informed of all attrition
            training.

      7.3.  All agent-level training-period performance, including attendance,
            quality, and assessment scores, regardless of whether net growth or
            attrition-related, will be reported [**] invoice.

      7.4.  The ratio of trainers to trainees is not to exceed a classroom level
            of [**] The [**] trainers can include a fully-certified trainer with
            the support of a supervisor who has been through a certified
            training course.

      7.5.  All costs and expenses for training and training materials for new
            agents and any initial and program extension training, or changes or
            modifications to the program or continuation training that exceeds
            [**] shall be borne by [**] Online options must be used by StarTek
            in lieu of printed materials wherever reasonably available. All
            written materials must be reused by StarTek where reasonable. [**]
            will not reimburse for training or training materials utilized for
            attrition-related training. [**] shall not compensate [**] for any
            agent who does not complete the training and graduate from [**].
            Documented training trackers must accompany all invoices for
            approval of billed charges. Documentation must contain as much
            information as allowed by law. Information required but not limited
            to: Agent name, agent training start date, attendance record, and
            assessment and quality scores. All Continuing Education classes are
            to be tracked via auxiliary (AUX) or automatic call distributor
            (ACD) code and submitted monthly with reporting displaying agent's
            name, the exact amount of time spent in each training course, the
            name of each training course, and the total time in the month spent
            in Continuing Education training. It is StarTek's responsibility to
            deliver all appropriate training within the scheduled time frame,
            subject to service level considerations.

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      7.6.  StarTek will schedule Streamline read time not to exceed the amount
            of six (6) minutes per day, no more than thirty (30) minutes per
            agent per week. Streamline read time must be measured via ACD or AUX
            code, or via skill set, and reported monthly. Streamline read time
            will be billed at the hourly continuing education training rate and
            is subject to the [**] StarTek is responsible for as referenced in
            section 7.5.

      7.7.  StarTek must not graduate any new hire agent from training/GMA to
            production if the agent has missed more than 8 hours in the training
            classroom, or 16 hours in GMA. The agent must return to the
            classroom or GMA as applicable to make up missed time before
            graduating to production. T-Mobile must receive written
            documentation of the missed time and proof that the time has been
            made up before being considered ready for production. New agents
            must also pass training assessments at [**] or higher in quality
            scores during GMA to graduate from training to production.

      7.8.  [**] requests for removal of personnel, including, but not limited
            to, new trainers and any associated materials, [**].

      7.9.  If StarTek is not meeting the quality standards set forth in Section
            14 below and it is determined by T-Mobile that additional "skill
            set" training is required for the StarTek representatives, [**] will
            bear the cost of the additional training.

      7.10.T-Mobile curriculum is to be facilitated by Certified Facilitators.
            Certification to be provided by StarTek. If the StarTek does not
            have a certification course they will be required to use the
            T-Mobile approved certification course. Facilitators are required to
            be certified by either T-Mobile Learning and Development specialist
            or their own Certified Training Manager. Non-certified
            Supervisors/Operations Managers/Coaches or Team Leads cannot conduct
            New Hire Training.

      7.11. StarTek will abide by the documented training guidelines.

8.    ESCALATION PROCEDURES. StarTek shall utilize T-Mobile-provided escalation
      processes, to handle calls beyond the agent's scope of training or for
      management support of a customer issue. This process will ensure that each
      call that cannot be handled by the agent is then handled by the lead
      representative up through the manager before being transferred to T-Mobile
      for resolution. If a customer requires management support, the agent shall
      transfer the call to a manager. T-Mobile shall update all on-line job
      aides that define the escalation procedures for the program when any
      changes are made.

9.    [**]

      9.1.  [**]

10.   CUSTOMER CARE SYSTEMS. StarTek shall be responsible for costs associated
      with workstations and local area network (LAN) infrastructure equipped to
      run the most recent version of the [**] deployed at the time of the
      implementation of this Agreement. StarTek is hereby granted a license for
      the term of this Agreement to use the [**] for the sole purposes of
      performing its obligations under this Agreement. StarTek shall also
      provide the building, telecommunications switch for the Interactive

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      Voice Response (IVR) system, remote monitoring application and associated
      toll free number, Universal Power Supply (UPS), desktop computers, office
      supplies, and dedicated workspaces in each call center. [**] shall be
      responsible for costs associated with wide area network (WAN)
      infrastructure (including, but not limited to, the WAN data connectivity
      infrastructure, application/database servers, routers, and related
      peripherals. [**] shall also be responsible for software required to
      support the [**]. T-Mobile will be responsible for the [**], Knowledge
      Database, and Call Tracking systems required to support the Services
      performed under this Agreement.

11.   SYSTEMS USE AND DOWNTIME. Information given to callers or collected by
      agents will be directly taken from and/or input into T-Mobile's systems.
      In the event that T-Mobile's systems go down, StarTek shall capture call
      information in Remedy, or on the downtime forms provided by T-Mobile and
      will be instructed on procedure in each scenario as applicable by
      T-Mobile. If paper forms are utilized, StarTek agrees that it shall then
      input information from these downtime forms once the system is restored.
      Turnaround commitment to enter downtime forms into T-Mobile's systems will
      be [**] from the time when T-Mobile's systems are restored. If call volume
      does not allow for [**] turnaround due to call volume meeting at least
      [**] the forecasted volume, another [**] input period shall be granted.
      Downtime forms will be destroyed (shredded or burned) or sent to T-Mobile,
      as directed by T-Mobile, every [**]. StarTek will assign a special ACD
      tracking code to designate when specified representatives are entering
      downtime form information into System. StarTek shall provide a downtime
      productivity report to T-Mobile displaying time in code, number of
      downtime forms processed and occupancy rate. T-Mobile agrees to pay
      StarTek the [**] (contingent upon meeting [**] per agent to be agreed upon
      by both parties) for entering downtime information as stated in the
      Pricing Schedule set forth in Section 24 of this Statement of Work.

12.   OVERTIME.

      12.1.If the daily work volume will exceed the Final Forecast by more than
            [**], StarTek will so notify T-Mobile and will recruit trained
            agents to work overtime to support the work handling. If the Final
            Forecast is within [**], StarTek must recruit agents to work
            overtime to cover the shortage and StarTek shall be responsible for
            any overtime expenses. Any additional staffing required for call
            volume over [**] Final Forecast must be approved by T-Mobile in
            advance. T-Mobile will pay the overtime rate for all approved
            overtime.

      12.2.The recruiting process for overtime shall be deployed as soon as the
            circumstance affecting the call volume variance is identified. If
            StarTek identifies the item at least [**] before the occurrence,
            StarTek shall use its commercially reasonable efforts to minimize
            the financial impact by changing schedules to support the staffing
            required. StarTek shall also recruit agents to work overtime on a
            [**] basis when the [**] call volume dictates additional staffing
            needs to maintain service goals.

      12.3.Except as provided above in Section 12.2, StarTek shall obtain
            written authorization from T-Mobile for any overtime that may be
            required or incurred for the performance of the Programs.

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      12.4.A reasonable estimate for the amount of overtime necessary to meet
            the Service Level will be provided to T-Mobile for written approval.
            Overtime need should be driven by [**] of the forecast. Overtime
            resulting from staffing [**].

13.   SIGNIFICANT CHANGES. When significant changes occur to the processes
      utilized to provide services, T-Mobile has the right to request
      information related to compliance and execution of such changes.

14.   KPIS. [**] T-Mobile will provide [**] specific KPIs to StarTek USA, Inc.
      All KPIs will be mutually agreed upon. 15. REPORTS. T-Mobile and StarTek
      will mutually agree upon required reports and timelines by December 1,
      2005. The tool for Offline will provide a "canned" set of reports.

16.   MONITORING. T-Mobile shall have the right, to the extent permitted by law
      and at no additional expense, to monitor at any time (either on-site or
      remotely) customer contact calls and/or specific agents to ensure
      compliance with performance, operational and quality control standards.
      [**] must provide [**] with a remote monitoring solution. There are two
      quality monitoring options required: a [**] and a [**]. The [**] would
      manage the [**], [**] calls within [**] of being [**]. [**] requires a
      minimum of [**] calls per agent per month [**]. [**] must have the ability
      to monitor random calls as they come into the queue, or by locating
      specific agents [**].

      A.    HOLIDAYS. StarTek shall observe the following holiday schedule [**].
            T-Mobile shall compensate StarTek for holiday rates as identified in
            the Pricing Schedule set forth hereunder when applicable to the
            location where work is performed. Holiday rates apply to the actual
            holiday only.

                        [**]                        US HOLIDAYS
                        [**]                  New Year's Day (Jan 1)
                        [**]             Memorial Day (last Monday in May)
                        [**]                  Fourth of July (July 4)
                        [**]           Labor Day (first Monday in September)
                        [**]        Thanksgiving Day (4th Thursday in November)
                        [**]                  Christmas (December 25)

17.   SYSTEM DOWNTIME; FORCE MAJEURE.

      17.1.In the event StarTek determines that system maintenance is necessary,
            StarTek will notify T-Mobile of the need for such maintenance [**]
            to the maintenance, and will obtain the prior written approval of
            T-Mobile to schedule the time and duration of such maintenance. All
            routine maintenance shall be scheduled during off-peak system hours.
            In no event shall interruption of Services for prior disclosed and
            approved system maintenance constitute a failure of performance by
            StarTek if performed in accordance with this Section 17. StarTek
            shall promptly report to T-Mobile any StarTek system failures,
            duration and impact.

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      17.2. Except for T-Mobile's obligation to make payments for services
            actually performed, each Party's failure to perform shall be excused
            where such failure is a result of causes beyond its reasonable
            control. Such causes shall include without limitation acts of God,
            strikes, lockouts, riots, acts of war, epidemics, governmental
            regulations imposed after the fact, fire, communication line
            failures of third parties, vandalism, power failures by third
            parties, cables cut by third parties, earthquakes, floods or other
            similar catastrophes, terrorist activities, failure of the T-Mobile
            system or the Internet not related to StarTek actions or inactions,
            any law, order, regulation, direction, action or request of any
            governmental entity or court or civil or military authority having
            jurisdiction over either of the parties, national emergencies,
            insurrections, riots, wars, strikes, lock outs, or work stoppages.
            In the event of failures to perform for [**] or more as a result of
            a force majeure, either Party may terminate the Agreement by giving
            written notice to the other Party. Any such notice of termination
            shall be effective upon receipt.

      17.3.Notwithstanding the foregoing or anything in the Agreement to the
            contrary, StarTek shall take commercially reasonable steps to ensure
            that the Services shall continue without interruption due to a
            StarTek systems failure during the term of the Agreement by
            implementing [**] reasonably necessary to provide the Services with
            an up-time of [**] (not including scheduled maintenance), which
            shall include [**] and the like. The components and execution of
            this plan must be reviewed, updated, and tested semi-annually and
            results reported to T-Mobile.

18.   ALLOCATION OF RESOURCES. T-Mobile acknowledges that upon the occurrence of
      a force majeure event or in instances of unusually high demand, demands on
      StarTek facilities may exceed such facilities available capacity. In any
      such instance, StarTek shall, upon written notice to T-Mobile, be entitled
      to equitably prioritize Services and otherwise curtail utilization of its
      facilities in a manner so that any degradation to the Services provided to
      T-Mobile is (unless agreed otherwise by T-Mobile in writing) no greater
      than the level of degradation experienced by StarTek's other customers.
      Upon the request of T-Mobile, StarTek shall provide T-Mobile with
      reasonable evidence of its compliance with the foregoing.

19.   RECRUITING REQUIREMENTS. StarTek recruiting efforts shall meet the
      following requirements in the selection process of all personnel hired to
      perform the T-Mobile services as described in this Agreement. T-Mobile
      reserves the right to audit the selection process.

      19.1. A mutually approved customer service assessment

      19.2. A behavioral interview

      19.3.Background checks, which shall include criminal records, are required
            and shall be completed before employment. Costs incurred for
            background checks associated with such criminal records [**].

20.   STAFFING REQUIREMENTS. StarTek agrees to maintain the following staffing
      ratios: [**] StarTek agrees that all managers shall be full-time StarTek
      employees. Subject

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      to Section 21.1, StarTek will ensure that each person assigned to a
      function has the necessary functional and T-Mobile-related training to
      successfully perform the function. StarTek must provide specific agent
      information up to what the law allows. Information required includes agent
      name, T-Mobile agent IDs, start date on T-Mobile line of business,
      assessment scores, termination date from T-Mobile line of business,
      quality average.

21.   All support functions such as StarTek quality, instructional analysts, and
      trainers must be housed within the site where the work is being performed
      unless otherwise agreed to in writing by T-Mobile.

      21.1.In addition, before a function is performed by an individual assigned
            to that function, StarTek shall verify that the necessary skills
            have been attained through the use of certification of skills
            program. If T-Mobile reasonably requests StarTek to remove any
            personnel performing Services pursuant to this Agreement, StarTek
            shall promptly comply with such request, within [**]. In support of
            this process, StarTek will do the following:

            21.1.1. Team leaders/supervisors shall perform productive work for
                  at least [**] to maintain their skills. The remainder of their
                  time shall be used to support agent development, and to
                  otherwise assist StarTek employees to perform the Services.

            21.1.2. Quality Assurance specialists shall perform productive work
                  for at least [**] to maintain their skills.

            21.1.3. Managers, lead representatives, team leaders/supervisors and
                  trainers must be full-time employees of StarTek and must have
                  completed T-Mobile National Standard Curriculum Training.

            21.1.4. Supervisors will audit a mutually agreeable amount of agent
                  work per week for accuracy.

22.   FRAUD. StarTek shall implement and enforce T-Mobile policies and
      procedures as well as StarTek's own procedures to detect and prevent
      handset or credit card theft or other fraudulent activity by an employee
      or agent of StarTek USA, Inc. StarTek shall cooperate with any T-Mobile
      investigation into handset or credit card theft or other fraudulent
      activity by an employee or agent of StarTek. If an employee or agent of
      StarTek is suspected of committing handset or credit card theft or other
      fraudulent activity against T-Mobile, StarTek will promptly notify
      T-Mobile of the suspected fraudulent activity and will provide T-Mobile
      with information necessary to conduct an investigation, including but not
      limited to the employee name, address, contact information, social
      security number, emergency contact address and phone numbers, and any
      other information that will assist in investigation of the suspected
      fraudulent activity. This information will be provided to T-Mobile within
      48 hours of the request from T-Mobile.

      StarTek. will assume all responsibility for handset theft, credit card
      theft or other fraudulent activity by an employee or agent of StarTek or
      their failure to follow T-Mobile policies and procedures. [**] to the
      following address:

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                 T-Mobile USA, Inc.
                 Attn:  Kevin Golas, Sr. Manager of Investigations
                 794 Roble Road
                 Allentown, PA  18109

      [**] shall be made to T-Mobile within [**] of the date the outsourced
      vendor receives an [**].

      T-Mobile reserves the right to prosecute any employee or agent of StarTek
      who committed fraud against T-Mobile or a customer of T-Mobile.

23.   BILLABLE HOURS: For purposes of this Agreement, "Billable Hours" is
      defined as:

      23.1. Hours [**] to Activations Offline, which [**].

      23.2.[**] hours shall not exceed the [**] unless increased workload is
            [**] and is [**] in writing.

24.   SERVICE LEVELS /BREACH OF SERVICE LEVELS. StarTek shall meet or exceed the
      Key Performance Indicator Service Levels as will be provided as referenced
      in Section 14.

25.   PRICING SCHEDULE. T-Mobile shall pay StarTek for Services as provided in
      the following schedule

      25.1. PRODUCTION PRICING.

            25.1.1. Standard Rate: [**]

            25.1.2. Holiday Rate: [**]

            25.1.3. Overtime Rate: [**]

      25.2. AGENT TRAINING.

            25.2.1. [**]

            25.2.2. [**]

            25.2.3. [**]

            25.2.4. [**]

            25.2.5. [**]

            25.2.6. [**]

            25.2.7. [**]

            25.2.8. [**]

            25.2.9. [**]

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EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, Steven D. Butler, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of StarTek, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2005	/s/ STEVEN D. BUTLER
	Steven D. Butler
	President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS

I, Rodd E. Granger, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of StarTek, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2005	/s/ RODD E. GRANGER
	Rodd E. Granger
	Executive Vice President and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATIONS

In connection with the Quarterly Report of StarTek, Inc. on Form 10-Q for the quarter ended September 30, 2005, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned individual, certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

1)	The Report fully ocmplies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2)	The information contained the Report fairly presents, in all material respects, the financial condition and result of operations of the Registrant.

Date: November 9, 2005	/s/ Steven D. Butler
	Steven D. Butler
	President and Chief Executive Officer
Date: November 9, 2005	/s/ Rodd E. Granger
	Rodd E. Granger
	Executive Vice President and Chief Financial Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the Corporation and will be retained by the Corporation and furnished to the Securities and Exchange Commission or its staff upon request.