8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) May 5, 2011

STARTEK, INC.

(Exact name of registrant as specified in its charter)

Delaware	1-12793	84-1370538
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

44 Cook Street Suite 400, Denver, Colorado	80206
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (303) 262-4500

(Former name or former address, if changed since last report.)

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

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

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

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

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

Item 1.01. Entry into a Material Definitive Agreement.

On May 5, 2011, the Company entered into a Settlement and Standstill Agreement (the “Agreement”) with Privet Fund LP, Privet Fund Management LLC, Ryan Levenson, Ben Rosenzweig, A. Emmett Stephenson, Jr. and Toni E. Stephenson (collectively, the “Privet Group”) relating to, among other matters, the composition of the Board of Directors of the Company (the “Board”).

The Agreement provides for, among other things, the following:

Board and Committee Composition; 2011 Annual Meeting

Pursuant to the Agreement, the Board will obtain, no later than May 9, 2011, the resignation from the Board of two directors, effective as of the date of the reconvened 2011 annual meeting of stockholders (the “2011 Annual Meeting”), and notice from such directors that they will not stand for reelection at the 2011 Annual Meeting.  In satisfaction of this provision, Dr. Albert C. Yates and Ms. Kay Norton have determined that they will not stand for reelection to the Board at the reconvened 2011 Annual Meeting, and will be submitting their resignations from the Board effective as of the 2011 Annual Meeting.  In addition, at duly convened meetings to be held immediately following the final adjournment of the 2011 Annual Meeting, the Nominating and Governance Committee of the Board will nominate for appointment to the Board, and the Board will take all necessary action to appoint, Ben Rosenzweig and Robert Sheft (the “Privet Directors”) to serve as directors of the Company until no earlier than the Company’s 2012 annual meeting of stockholders (the “2012 Annual Meeting”) and until their successors are duly elected and qualified.  In the event either of the Privet Directors is unable to complete his term, the Board agrees to appoint a replacement director designated by the Privet Group and reasonably acceptable to the Company.

The Board has also agreed to appoint Mr. Rosenzweig to the Compensation Committee and to the Nominating and Corporate Governance Committee of the Board and to appoint Mr. Sheft to the Audit Committee of the Board.  In addition, pursuant to the Agreement, at least one Privet Director will be appointed to each other standing or special committee of the Board constituted by the Board between the date of the Agreement and the 2012 Annual Meeting.

Pursuant to the Agreement, each member of the Privet Group will cause the shares of common stock of the Company owned by them of record or beneficially as of the record date for the 2011 Annual Meeting to be present for quorum purposes and to be voted at the 2011 Annual Meeting or at any adjournments or postponements thereof, in accordance with the Board’s recommendation for each of the proposals described in the Company’s proxy statement dated March 30, 2011.  The Privet Group has also agreed to inform any stockholder of the Company previously contacted by any member of the Privet Group in connection with the 2011 Annual Meeting that each member of the Privet Group is voting in accordance with the Board’s recommendation as described in the preceding sentence.

Standstill

Pursuant to the Agreement, until the later of one year from the date of the Agreement and while a Privet Director serves on the Board, none of the Privet Fund LP, Privet Fund Management LLC, Ryan Levenson and Ben Rosenzweig, or any of their respective affiliates, shall, directly or indirectly, in any manner:

(a)engage in any solicitation of proxies or written consents or become a “participant” in a “solicitation” (as such terms are defined in Regulation 14A under the Securities Exchange

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Act of 1934, as amended (the “Exchange Act”) or the rules or regulations thereunder) of proxies or written consents (including, without limitation, any solicitation of written consents to call a special meeting of stockholders), in each case, with respect to securities of the Company;

(b)conduct, or knowingly encourage, participate or engage in any other type of referendum (binding or non-binding) with respect to the Company, including without limitation relating to the removal or the election of directors;

(c)knowingly seek to advise, encourage, support or influence any person with respect to the voting or disposition of any securities of the Company at any annual or special meeting of stockholders;

(d)initiate, propose or otherwise “solicit” stockholders of the Company for the approval of any stockholder proposal;

(e)form or join in a partnership, limited partnership, syndicate or other group, including without limitation a group (other than in each case, solely with such member’s affiliates, associates, or immediate family members) as defined under Section 13(d) of the Exchange Act or Rule 13d-5(b) promulgated pursuant to the Exchange Act with respect to any securities of the Company or otherwise support or participate in any effort by a third party with respect to the matters described under the heading “Standstill;”

(f)deposit any securities of the Company in a voting trust or subject any securities of the Company to any arrangement or agreement with respect to the voting of the securities of the Company;

(g)without the prior approval of the Board contained in a written resolution of the Board, (x) either directly or indirectly for itself or its affiliates, or in conjunction with any other person or entity in which it is or proposes to be either a principal, partner or financing source or is acting or proposes to act as broker or agent for compensation, effect or seek, offer or propose (whether publicly or otherwise) to effect, or cause or participate in, or (y) in any way knowingly support, assist or facilitate any other person to effect or seek, offer or propose to effect, or cause or participate in, (i) any tender offer or exchange offer, merger, acquisition or other business combination involving the Company or any of its subsidiaries or affiliates, (ii) any form of business combination or acquisition or other transaction relating to a material amount of assets or securities of the Company or any of its subsidiaries or affiliates or (iii) any form of restructuring, recapitalization or similar transaction with respect to the Company or any of its subsidiaries or affiliates;

(h)vote for any nominee or nominees for election to the Board, other than those nominated or supported by the Board; or

(i)except as specifically provided in the Agreement, seek, alone or in concert with others, to (x) place a representative or other affiliate or nominee on the Board, (y) seek the removal of any member of the Board or (z) change the size or composition of the Board.

The Agreement also provides that no action by a Privet Director taken in his capacity as a member of the Board shall be deemed to violate the foregoing standstill provisions.

Mr. and Mrs. Stephenson and the shares of the Company’s common stock beneficially owned by them are not subject to the Standstill. Furthermore, none of the provisions in the Agreement that impose limitations on actions that may be taken by the Privet Fund LP, Privet Fund Management LLC, Ryan Levenson and Ben Rosenzweig, or any of their respective affiliates, restrict the rights that the Stephensons have pursuant to the Investor Rights Agreement, the terms of which are more fully described in the 2011 Proxy Statement.

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Fees and Expenses

Except as noted below, neither the Company, on the one hand, nor the Privet Group, on the other hand, will be responsible for any fees or expenses of the other in connection with the Agreement or the 2011 Annual Meeting of Stockholders.  The Company shall compensate the Privet Directors, and reimburse reasonable travel expenses of the Privet Directors, on the same basis as other independent directors of the Company. The Company shall pay $50,000 to reimburse the Privet Group for reasonable fees and expenses incurred in connection with the nomination of the Privet Directors.

Mutual Release

As more fully described in the Agreement, the Privet Group agrees to forever fully release and discharge the Company and its officers, directors, agents, affiliates, employees, partners, representatives, attorneys, heirs, assigns, executors, administrators, predecessors and successors, past and present, of any and all claims arising in respect of or in connection with, the nomination and election of directors at the 2011 Annual Meeting, occurring any time or period of time on or prior to the date of the Agreement.

Also as more fully described in the Agreement, the Company agrees to forever fully release and discharge the Privet Group and its controlling persons, officers, directors, stockholders, agents, affiliates, employees, partners, representatives, attorneys, heirs, assigns, executors, administrators, predecessors and successors, past and present, as well as each of the Privet Directors, of any and all claims arising in respect of or in connection with, the nomination and election of directors at the 2011 Annual Meeting, occurring any time or period of time on or prior to the date of the Agreement.

The foregoing description of the Settlement Agreement is qualified in its entirety by reference to the full text of the Settlement Agreement, a copy of which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.

Item 5.02.  Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(b)           On May 5, 2011, Dr. Albert C. Yates and Ms. Kay Norton notified the Company that they will resign from the Board effective as of, and will not stand for re-election at, the Company’s 2011 Annual Meeting.  As previously disclosed, the 2011 Annual Meeting was convened on May 2, 2011, as scheduled, and was adjourned.  The Annual Meeting will be reconvened on May 11, 2011.

Item 7.01.  Regulation FD Disclosure

On May 5, 2011, the Company issued a press release regarding the Settlement Agreement. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

In accordance with general instruction B.2 to Form 8-K, the information in this Form 8-K under this Item 7.01 (Regulation FD Disclosure), including the press release furnished as an exhibit hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or Securities Exchange Act of 1934.

Item 9.01.  Financial Statements and Exhibits

(d) Exhibits

10.1Settlement and Standstill Agreement by and among StarTek, Inc., A. Emmett Stephenson, Jr.,

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Privet Fund LP, Privet Fund Management LLP, Ryan Levenson, Ben Rosenzweig and Toni E. Stephenson dated as of May 5, 2011.

99.1Press Release dated May 5, 2011.

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SIGNATURES

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

StarTek, Inc.

(Registrant)

By:	/s/ David G. Durham	Date: May 5, 2011
David G. Durham
Executive Vice President, Chief Financial Officer and Treasurer

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EX-10.1

Exhibit 10.1

Execution Version

SETTLEMENT AND STANDSTILL AGREEMENT

This SETTLEMENT AND STANDSTILL AGREEMENT dated May 5, 2011 (this “Agreement”) is by and among the persons listed on Schedule A (collectively, the “Privet Group” and each individually a “member” of the Privet Group) and Startek, Inc. (the “Company”)

WHEREAS, the Company and the Privet Group have engaged in various discussions and communications concerning the Company’s business, financial performance and strategic plan;

WHEREAS, the Privet Group and other participants gave notice to the Company that they intend to nominate certain individuals for election as directors to the Board of Directors of the Company (the “Board”) at the Company’s 2011 annual meeting of stockholders (the “2011 Annual Meeting”);

WHEREAS, the Company informed the Privet Group that the director nomination notice failed to comply with the requirements for director nominations under the Bylaws of the Company;

WHEREAS, the Privet Group has indicated to the Company that the Privet Group is considering proposing stockholder action to facilitate the election of new directors to the Board;

WHEREAS, each of the Company and the Privet Group has determined that it is in each party’s best interests to come to an agreement with respect to certain matters including the composition of the Board. and

WHEREAS, the Board convened and immediately adjourned the 2011 Annual Meeting, to be reconvened on May 11, 2011, in order to provide time for the negotiation of the terms of this Agreement and to facilitate the implementation of such terms.

NOW, THEREFORE, in consideration of and reliance upon the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1.Board Composition; 2011 Annual Meeting.

(a)Voting at the 2011 Annual Meeting.  Upon receiving evidence reasonably satisfactory of the occurrence of the events contemplated by Sections 1(b) through 1(d) of this Agreement, each member of the Privet Group shall cause, in the case of all shares owned of record, and shall instruct the record owner, in the case of all shares of common stock of the Company, par value $0.01 per share (the “Common Stock”) beneficially owned but not owned of record, directly or indirectly, by it, or by any Affiliate of such member of the Privet Group, as of the record date for the 2011 Annual Meeting, to be present for quorum purposes and to be voted, at the reconvened 2011 Annual Meeting or at any adjournments or postponements thereof, in accordance with the Board’s recommendations for each of the proposals described in the Company’s proxy statement relating to the 2011 Annual Meeting dated March 30, 2011.  For purposes of this Agreement: the term “Affiliate” shall have the meaning set forth in Rule 12b-2 promulgated by the SEC under the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and the terms “person” or “persons” shall mean any individual, corporation (including not-for-profit), general or limited partnership, limited liability or unlimited liability company, joint venture, estate, trust, association, organization or other entity of any kind or nature.

(b)Director Resignations.  As soon as practicable after the date of this Agreement, but in no event later than May 9, 2011, the Board shall obtain the resignation from the Board of two directors,

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effective as of the date of the reconvened 2011 Annual Meeting, and notice from such directors that they will not stand for re-election at the reconvened 2011 Annual Meeting.

(c)Director Appointments.  The Company’s Nominating and Governance Committee, at a duly convened meeting to be held on May 11, 2011 immediately following the final adjournment of the reconvened 2011 Annual Meeting, shall nominate for appointment to the Board, and the Board at a duly convened meeting to be held on May 11, 2011, shall take all necessary action to appoint Ben Rosenzweig and Robert Sheft (each a “Privet Director”) to serve as directors of the Company until no earlier than the Company’s 2012 annual meeting of stockholders (the “2012 Annual Meeting”) and until their successors are duly elected and qualified, subject to the terms of this Agreement.  In the event of the death, disability or other event resulting in either of the Privet Directors being unable to complete their respective terms, the Board shall appoint a replacement Privet Director designated by the Privet Group and reasonably acceptable to the Company.

(d)Committee Appointments.  At the meeting to be held on May 11, 2011, the Board shall take all necessary action to appoint Rosenzweig to the Compensation Committee and the Nominating and Corporate Governance Committee and Sheft to the Audit Committee of the Company, or other standing committees performing similar functions (which committees are the only standing committees of the Board as of the date hereof).  In addition, at least one Privet Director shall be appointed to each other standing or special committee of the Board constituted by the Board between the date hereof and the 2012 Annual Meeting, until no earlier than the 2012 Annual Meeting.

(e)Bylaws.  The Company agrees that between the date hereof and the date the Privet Directors are appointed to the Board, the Board shall not take any action to amend the Bylaws or other corporate governance documents of the Company.

(f)Investor Rights Agreement.  The parties agree that no provision of this Agreement shall have the effect of amending, terminating or otherwise modifying or limiting the terms of the Investor Rights Agreement dated as of February 13, 2004  (the “Investor Rights Agreement”) between the Company, A. Emmet Stephenson, Jr. (“AES”), and Toni E. Stephenson (“TES”).  Without limiting the generality of the foregoing and for the avoidance of doubt, no provision of this Agreement shall limit the ability of AES or TES to exercise their rights under the Investor Rights Agreement.

(g)Schedule 13D; Supplemental Proxy Materials.  Promptly following the execution and delivery of this Agreement (i) each member of the Privet Group shall file a Schedule 13D with the Securities and Exchange Commission describing the terms of this Agreement; provided however, the Company shall first be given the opportunity to review and comment on any draft Schedule 13D prior to such filing and (ii) the Company shall prepare, file with the Securities and Exchange Commission and disseminate to the Company’s stockholders, supplemental proxy soliciting materials describing the terms of this Agreement; provided however, the Privet Group shall first be given the opportunity to review and comment on any draft supplemental soliciting materials prior to such filing.

(h)Other Shareholders.  Promptly following the execution and delivery of this Agreement, each member of the Privet Group shall take reasonable steps to inform any shareholder of the Company previously contacted by any member of the Privet Group in connection with the 2011 Annual Meeting that each member of the Privet Group is voting accordance with the Board’s recommendations for each of the proposals described in the Company’s proxy statement relating to the 2011 Annual Meeting dated March 30, 2011; provided, however, in no event will any member of the Privet Group be required to take any action that would constitute a “solicitation” (as such term is defined in Regulation 14A under the Exchange Act or the rules or regulations thereunder) requiring any member of the Privet Group to file with the Securities and Exchange Commission proxy solicitation materials pursuant to Regulation 14A under the Exchange Act or the rules or regulations thereunder.

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2.Privet Standstill.

With respect to Privet Fund LP, Privet Fund Management LLC, Ryan Levenson and Ben Rosenzweig, and any of their respective Affiliates, until the later of (i) one (1) year from the date of this Agreement and (ii) while a Privet Director serves on the Board, no member of the Privet Group (excluding AES and TES) nor any Privet Affiliate shall, directly or indirectly, in any manner:

(a)engage in any solicitation of proxies or written consents or become a “participant” in a “solicitation” (as such terms are defined in Regulation 14A under the Exchange Act or the rules or regulations thereunder) of proxies or written consents (including, without limitation, any solicitation of written consents to call a special meeting of stockholders), in each case, with respect to securities of the Company;

(b)conduct, or knowingly encourage, participate or engage in any other type of referendum (binding or non-binding) with respect to the Company, including without limitation relating to the removal or the election of directors;

(c)knowingly seek to advise, encourage, support or influence any person with respect to the voting or disposition of any securities of the Company at any annual or special meeting of stockholders;

(d)initiate, propose or otherwise knowingly “solicit” stockholders of the Company for the approval of any stockholder proposal;

(e)form or join in a partnership, limited partnership, syndicate or other group, including without limitation a “group” (other than in each case, solely with the members of the Privet Group and their Affiliates, Associates, or immediate family members) as defined under Section 13(d) of the Exchange Act or Rule 13d-5(b) promulgated pursuant to the Exchange Act with respect to any securities of the Company or otherwise support or participate in any effort by a third party with respect to the matters set forth in this Section 2;

(f)deposit any securities of the Company in a voting trust or subject any securities of the Company to any arrangement or agreement with respect to the voting of the securities of the Company;

(g)without the prior approval of the Board contained in a written resolution of the Board, (x) either directly or indirectly for itself or its Affiliates, or in conjunction with any other person or entity in which it is or proposes to be either a principal, partner or financing source or is acting or proposes to act as broker or agent for compensation, effect or seek, offer or propose (whether publicly or otherwise) to effect, or cause or participate in, or (y) in any way knowingly support, assist or facilitate any other person to effect or seek, offer or propose to effect, or cause or participate in, any (i) tender offer or exchange offer, merger, acquisition or other business combination involving the Company or any of its subsidiaries or affiliates; (ii) any form of business combination or acquisition or other transaction relating to a material amount of assets or securities of the Company or any of its subsidiaries or affiliates or (iii) any form of restructuring, recapitalization or similar transaction with respect to the Company or any of its subsidiaries or affiliates;

(h)vote for any nominee or nominees for election to the Board, other than those nominated or supported by the Board;

(i)except as specifically provided in this Agreement, seek, alone or in concert with others, to (x) place a representative or other affiliate or nominee on the Board, (y) seek the removal of any member of the Board or (z) change the size or composition of the Board; or

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For the avoidance of doubt, any actions of a Privet Director taken in his capacity as a member of the Board of Directors shall not be deemed to violate the foregoing clauses (a) through (i).

3.Mutual Release and Non-Disparagement.

(a)Privet Release.  Effective as of the appointment of the Privet Directors pursuant to the Section 1(c) of this Agreement (the “Release Date’) , the Privet Group hereby agrees, for the benefit of the Company and each officer, director, agent, Affiliate, employee, partner, representative, attorney, heir, assign, executor, administrator, predecessor and successor, past and present, of the Company (the Company and each such person being a “Company Released Person”)  that, effective from and after the Release Date, they hereby acknowledge full and complete satisfaction of, and covenant not to sue, and forever fully release and discharge each Company Released Person of, and hold each Company Released Person harmless from, any and all rights, claims, warranties, demands, debts, obligations, liabilities, costs, attorneys’ fees, expenses, suits, losses and causes of action of any nature whatsoever, in law or in equity, whether known or unknown, suspected or unsuspected (“Claims”) arising in respect of or in connection with, the nomination and election of directors at the 2011 Annual Meeting, occurring any time or period of time on or prior to the date of the execution of this Agreement; provided, however, that nothing set forth herein shall in any way constitute a release by AES or TES of any alleged Claims pursuant to the terms of the Investor Rights Agreement based upon the adoption by the Company of the Amended and Restated Bylaws on March 31, 2011.

(b)Company Release.  The Company hereby agrees, for the benefit of the Privet Group, and each controlling person, officer, director, stockholder, agent, Affiliate, employee, partner, representative, attorney, heir, assign, executor, administrator, predecessor and successor, past and present, thereof, as well as each of the Privet Directors (the Privet Group and each such person being an “Privet Released Person”) that effective from and after the Release Date, it hereby acknowledges full and complete satisfaction of, and covenants not to sue, and forever fully releases and discharges each Privet Released Person of, and holds each Privet Released Person harmless from, any and all Claims arising in respect of or in connection with, the nomination and election of directors at the 2011 Annual Meeting, occurring any time or period of time on or prior to the date of the execution of this Agreement.

(c)Privet Non-Disparagement.  No member of the Privet Group will intentionally make, or cause to be made, any statement or announcement that relates to and constitutes an ad hominem attack on, or relates to and otherwise disparages, the Company, its officers or its directors or any person who has served as an officer or director of the Company on or following the date of this Agreement: (i) in any document or report filed with or furnished to the SEC or any other governmental agency, (ii) in any press release or other publicly available format, or (iii) to any journalist or member of the media (including without limitation, in a television, radio, newspaper or magazine interview).

(d)Company Non-Disparagement.  The Company will not intentionally make, and will instruct those individuals serving as officers and directors of the Company as of the date hereof not to intentionally make,  or cause to be made, any statement or announcement that relates to and constitutes an ad hominem attack on, or relates to and otherwise disparages, any member of the Privet Group: (i) in any document or report filed with or furnished to the SEC or any other governmental agency, (ii) in any press release or other publicly available format, or (iii) to any journalist or member of the media (including without limitation, in a television, radio, newspaper or magazine interview).

4.Other Agreements.

(a)Vote Tabulation.  Immediately following the execution of this Agreement, the Company shall provide to AES a report from Broadridge dated no earlier than April 29, 2011 summarizing the tabulated votes cast for the 2011 Annual Meeting (“Vote Tabulation”).  AES hereby agrees that it will

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keep the Vote Tabulation strictly confidential and not disclose the Vote Tabulation in any manner whatsoever without the prior written consent of the Company.

(b)Public Announcements.  Following the execution of this Agreement, (i) the Company shall issue the press release announcing the terms of this Agreement, in the form attached hereto as Exhibit B (the “Press Release”), and shall file a Current Report on Form 8-K with the SEC disclosing the terms of this Agreement and attaching as exhibits this Agreement and the Press Release and (ii) the Privet Group shall file the Schedule 13D contemplated by Section 1(g) hereof.

(c)Specific Performance.  Each of the members of the Privet Group, on the one hand, and the Company, on the other hand, acknowledges and agrees that irreparable injury to the other party hereto may occur in the event any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached and that such injury would not be adequately compensable in damages.  It is accordingly agreed that the members of the Privet Group or any of them, on the one hand, and the Company, on the other hand (the “Moving Party”), shall each be entitled to specific enforcement of, and injunctive relief to prevent any violation of, the terms hereof, and the other party hereto will not take action, directly or indirectly, in opposition to the Moving Party seeking such relief on the grounds that any other remedy or relief is available at law or in equity.

(d)Severability.  If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the parties agree to use their best efforts to agree upon and substitute a valid and enforceable term, provision, covenant or restriction for any of such that is held invalid, void or enforceable by a court of competent jurisdiction.

(e)Notices. Any notices, consents, determinations, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one (1) business day after deposit with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall be:

If the Company:

Startek, Inc.

44 Cook Street, Suite 400

Denver, CO 80206

Attention:

Facsimile:

with a copy to:

Hogan Lovells US LLP

1200 Seventeenth Street, Suite 1500

Denver, Colorado 80202

Attention: Paul Hilton

Facsimile: (303) 899-7333

If to the Privet Group:

Privet Fund Management LLC

50 Old Ivy Road

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Suite 230

Atlanta, GA 30342

Attention:  Ryan Levenson

Facsimile:  404-467-6101

With a copy to:

Bryan Cave LLP

1201 W. Peachtree Street, N.W.

14th Floor

Atlanta, Georgia 30309

Attention:  Rick Miller & Eliot Robinson

Facsimile:  404-420-0787

If to AES or TES:

A. Emmet Stephenson, Jr.

400 Nevada Way

Boulder City, Nevada 89005

Emmet@great.net

With copies to:

Toni E. Stephenson

400 Nevada Way

Boulder City, Nevada 89005

tonis@great.net

Bryan Cave LLP

1201 W. Peachtree Street, N.W.

14th Floor

Atlanta, Georgia 30309

Attention:  Rick Miller & Eliot Robinson

Facsimile:  404-420-0787

(f)Applicable Law. This Agreement is governed by and construed in accordance with the internal laws of the State of Delaware applicable to contracts made and to be performed therein, without regard to the conflict of laws principles. Each party submits to exclusive jurisdiction and venue of federal or state courts in Delaware and agrees not to institute litigation in any other forums in respect of the interpretation or enforcement of this Agreement (except for proceedings to obtain enforcement of an order of a Delaware federal or state court).

(g)Counterparts.  This Agreement and any amendments hereto may be executed and delivered in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement.

(h)Entire Agreement; Amendment and Waiver; Successors and Assigns.  This Agreement contains the entire understanding of the parties hereto with respect to its subject matter.  There are no restrictions, agreements, promises, representations, warranties, covenants or undertakings between the parties other than those expressly set forth herein.  This Agreement may be amended only by a written

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instrument duly executed by the parties hereto or their respective successors or assigns.  No failure on the part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such party preclude any other or further exercise thereof or the exercise of any other right, power or remedy.  All remedies hereunder are cumulative and are not exclusive of any other remedies provided by law.  The terms and conditions of this Agreement shall be binding upon, inure to the benefit of, and be enforceable by the parties hereto and their respective successors, heirs, executors, legal representatives, and permitted assigns. No party shall assign this Agreement or any rights or obligations hereunder without the prior written consent the other party.

(i)No Third Party Beneficiaries. This Agreement is solely for the benefit of the parties hereto and is not enforceable by any other persons.

(j)Fees and Expenses. Except as expressly set forth below, neither the Company, on the one hand, nor the Privet Group, on the other hand, will be responsible for any fees or expenses of the other in connection with this Agreement or the 2011 Annual Meeting of Stockholders.   The Company shall compensate the Privet Directors, and reimburse reasonable travel expenses of the Privet Directors, on the same basis as other independent directors of the Company. The Company shall pay $50,000 to reimburse the Privet Group for the reasonable fees and expenses incurred in connection with the nomination of the Privet Directors.

(k)Interpretation and Construction. Each of the parties hereto acknowledges that it has been represented by counsel of its choice throughout all negotiations that have preceded the execution of this Agreement, and that it has executed the same with the advice of said independent counsel. Each party and its counsel cooperated and participated in the drafting and preparation of this Agreement and the documents referred to herein, and any and all drafts relating thereto exchanged among the parties shall be deemed the work product of all of the parties and may not be construed against any party by reason of its drafting or preparation. Accordingly, any rule of law or any legal decision that would require interpretation of any ambiguities in this Agreement against any party that drafted or prepared it is of no application and is hereby expressly waived by each of the parties hereto, and any controversy over interpretations of this Agreement shall be decided without regards to events of drafting or preparation. The section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

[Signature Pages to Follow]

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IN WITNESS WHEREOF, each of the parties hereto has executed this Settlement and Standstill Agreement, or caused the same to be executed by its duly authorized representative as of the date first above written.

THE COMPANY:

Startek, Inc.

/s/ Ed Zschau

Name: Ed Zschau

Title: Chairman of the Board

THE PRIVET GROUP:

Privet Fund LP

/s/ Ryan Levenson

Name: Ryan Levenson

Title: Manager

Privet Fund Management LLC

/s/ Ryan Levenson

Name: Ryan Levenson

Title: Manager

Ryan Levenson

/s/ Ryan Levenson

Ben Rosenzweig

/s/ Ryan Levenson

A. Emmet Stephenson, Jr.

/s/ A. Emmet Stephenson, Jr.

Toni E. Stephenson

/s/ Toni E. Stephenson

8

Schedule A

Privet Fund LP

Privet Fund Management LLC

Ryan Levenson

Ben Rosenzweig

A. Emmet Stephenson, Jr.

Toni E. Stephenson

9

EX-99.1

Exhibit 99.1

INVESTOR RELATIONS CONTACT:

Julie Pierce

Director of SEC Reporting, StarTek, Inc.

303-262-4587

julie.pierce@startek.com

StarTek to Appoint Robert Sheft and Benjamin Rosenzweig to

Board of Directors

DENVER, CO — May 5, 2011 — StarTek, Inc. (NYSE:SRT) today announced that, following the conclusion of the reconvened 2011 Annual Meeting of Stockholders on May 11, 2011, the Company will appoint Robert Sheft and Benjamin Rosenzweig to the Board of Directors.  Messrs. Sheft and Rosenzweig, who will serve as directors until no earlier than the Company’s 2012 Annual Meeting of Stockholders, will replace Dr. Albert C. Yates and Ms. Kay Norton, who have advised the Board that they will not stand for reelection to the Board at the reconvened 2011 Annual Meeting.  Mr. Rosenzweig will serve on the Compensation Committee and the Nominating and Corporate Governance Committee and Mr. Sheft will serve on the Audit Committee.

The appointment of Messrs. Sheft and Rosenzweig to StarTek’s Board is in connection with a settlement and standstill agreement the Company entered into on May 5, 2011 with Privet Fund LP, Privet Fund Management LLC, Ryan Levenson, Benjamin Rosenzweig, A. Emmet Stephenson, Jr. and Toni E. Stephenson (the “Privet Group”).  The agreement is more fully described in the Company’s additional proxy materials to be filed tomorrow with the Securities and Exchange Commission (“SEC”) and in a Schedule 13D to be filed by the Privet Group with the SEC on or before May 9, 2011.  Pursuant to the agreement, each member of the Privet Group will cause its shares to be voted at the reconvened 2011 Annual Meeting in accordance with the Board’s recommendation for each of the proposals described in the Company’s proxy statement dated March 30, 2011.  In addition, as more fully described in the agreement, the members of the Privet Group, other than A. Emmet Stephenson, Jr. and Toni E. Stephenson, agree until the later of May 5, 2012 or until Messrs. Rosenzweig and Sheft are no longer serving as directors, not to engage in, among other things, any proxy solicitation with respect to the securities of the Company or any tender offer, business combination or restructuring with respect to the Company, and not to seek to place a representative on the Board, seek the removal of any member of the Board or change the size or composition of the Board.  Privet Group has reported beneficial ownership of approximately 25.77% of StarTek’s outstanding shares.

“We are pleased to welcome Robert and Ben to the Board, and we are confident that StarTek will benefit from their involvement in the leadership of the Company as we work together to enhance value for our shareholders,” said Dr. Ed Zschau, Chairman of the Board of StarTek.

“On behalf of all of us at StarTek, I  want to thank Al Yates  and Kay Norton for their seven years of dedicated service to the Company,” continued Dr. Zschau.  “They have each made significant contributions to StarTek over the years, they have each chaired Board committees with distinction, and they each played a pivotal role in the transition being announced today.  We will miss their wisdom and their commitment to the Company in the years ahead.”

“We are pleased to join the StarTek Board and anticipate working closely with our fellow directors as well as management to help return StarTek to profitability,” Messrs. Sheft and Rosenzweig said in a joint statement.  “StarTek is an outstanding company with excellent potential. We look forward to leveraging our business experience to help grow the company and enhance value for StarTek’s stockholders.”

Mr. Sheft, 50, is the Founder, President and Chief Executive Officer of Simply Floored LLC, an innovative home improvement company offering shop-at-home services for flooring and insulation.  Mr. Sheft is currently a managing director at Roark Capital Group, a private equity firm based in Atlanta.  Prior to starting Simply Floored in 2004, Mr. Sheft was the Founder, President and Chief Executive Officer of RMA Home Services, Inc. (RMA),  from 1997 until its acquisition by The Home Depot in December 2003.  Mr. Sheft built RMA into one of the largest providers of installed siding and window services in the country, with revenues of more than $200 million, customers in more than 1,000 Home Depot stores nationwide, and 1,200 associates operating out of 22 branch offices and a support center in Atlanta. Prior to founding RMA, Mr. Sheft served for five years as a Managing Director of merchant banking at First Southwest.  He began his career as an attorney in the mergers and acquisitions practice of Skadden, Arps, Slate, Meagher & Flom LLP.  From 2006 until 2008, Mr. Sheft served on the board of Marathon Acquisition Corp., a special purpose acquisition company. He is a trustee of Pace Academy in Atlanta where he also chairs the Governance Committee. Mr. Sheft graduated Magna Cum Laude with a Bachelor of Science in Finance from the University of Pennsylvania’s Wharton School and as a James Kent Scholar from the Columbia University School of Law.

Mr. Rosenzweig, 26, is currently an analyst at Privet Fund Management LLC.  Prior to joining Privet in September 2008, Mr. Rosenzweig served as an investment banking analyst in the corporate finance group of Alvarez and Marsal, where he completed multiple distressed mergers and acquisitions, restructurings, capital  formation transactions and  similar financial advisory engagements across several industries.  He has considerable financial expertise, including extensive involvement with capital market transactions and turnaround situations.  Mr. Rosenzweig graduated magna cum laude from Emory University with a Bachelor of Business Administration degree in Finance and a Bachelor of Arts in Economics.

About StarTek

StarTek, Inc. (NYSE: SRT) is a leading customer experience expert in the business process outsourcing industry.  Our clients rely on us to ensure a great customer experience resulting in improved customer satisfaction and retention and an increase in revenue and cost efficiencies for our clients.  StarTek has the platforms and the expertise to compete with the largest companies but we remain small enough to focus on partnering with our clients to develop creative solutions that fit their unique needs.  StarTek’s comprehensive suite of solutions includes sales, order management and provisioning, customer care, technical support, receivables management, and retention programs. Our company also offers clients a variety of multi-channel customer interaction capabilities including voice, chat, email, IVR and back-office support. Headquartered in Denver, Colorado, StarTek has delivery centers onshore in North America, near shore in Costa Rica, offshore in the Philippines and virtually through its StarTek@Home workforce. For more information, visit www.StarTek.com or call +1 303.262.4500.