Filed by Bowne Pure Compliance

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KWIV2FCfzAGWNxffTgX76nxH4VAacSRidciFA+thDecRoJOWuBoc5sjRBUuLQujT gGFKXx/zsIoqnZwHkJKwmg== 0001362310-08-004420.txt : 20080811 0001362310-08-004420.hdr.sgml : 20080811 20080811135737 ACCESSION NUMBER: 0001362310-08-004420 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 21 CONFORMED PERIOD OF REPORT: 20080630 FILED AS OF DATE: 20080811 DATE AS OF CHANGE: 20080811 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STARTEK INC CENTRAL INDEX KEY: 0001031029 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 841370538 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-12793 FILM NUMBER: 081005396 BUSINESS ADDRESS: STREET 1: 100 GARFIELD STREET CITY: DENVER STATE: CO ZIP: 80206 BUSINESS PHONE: 303-399-2400 MAIL ADDRESS: STREET 1: 44 COOK STREET STREET 2: SUITE 400 CITY: DENVER STATE: CO ZIP: 80206 10-Q 1 c74453e10vq.htm FORM 10-Q Filed by Bowne Pure Compliance

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 June 30, 2008


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.)

44 Cook Street, 4^th Floor
Denver, Colorado		80206
(Address of principal executive offices)		(Zip code)

(303) 262-4500
(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 a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer o	Accelerated filer þ	Non-accelerated filer o	Smaller reporting company o
		(Do not check if a smaller reporting company)

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 — 14,778,591 shares as of July 15, 2008.

STARTEK, INC. AND SUBSIDIARIES

FORM 10-Q

INDEX


PART I. FINANCIAL INFORMATION	Page

Item 1. Financial Statements (unaudited):

Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2008 and 2007		4

Condensed Consolidated Balance Sheets as of June 30, 2008 and December 31, 2007		5

Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2008 and 2007		6

Notes to Condensed Consolidated Financial Statements		7

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		15

Item 3. Quantitative and Qualitative Disclosures About Market Risk		22

Item 4. Controls and Procedures		23

PART II. OTHER INFORMATION

Item 1. Legal Proceedings		23

Item 1a. Risk Factors		23

Item 4. Submission of Matters to a Vote of Security Holders		24

Item 6. Exhibits		24

SIGNATURES		25

Exhibit 10.9
Exhibit 10.12
Exhibit 10.13
Exhibit 10.14
Exhibit 10.15
Exhibit 10.16
Exhibit 10.17
Exhibit 10.18
Exhibit 10.19
Exhibit 10.20
Exhibit 10.21
Exhibit 10.22
Exhibit 10.23
Exhibit 10.24
Exhibit 10.25
Exhibit 10.26
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including the following:

	•		certain statements, including possible or assumed future results of operations, in “Management’s Discussion and Analysis of Financial Condition and Results of Operations;”

	•		any statements contained herein regarding the prospects for our business or any of our services;

	•		any statements preceded by, followed by or that include the words “may,” “will,” “should,” “seeks,” “believes,” “expects,” “anticipates,” “intends,” “continue,” “estimate,” “plans,” “future,” “targets,” “predicts,” “budgeted,” “projections,” “outlooks,” “attempts,” “is scheduled,” or similar expressions; and

	•		other statements contained herein regarding matters that are not historical facts.

Our business and results of operations are subject to risks and uncertainties, many of which are beyond our ability to control or predict. Because of these risks and uncertainties, actual results may differ materially from those expressed or implied by forward-looking statements, and investors are cautioned not to place undue reliance on such statements, which speak only as of the date thereof. Important factors that could cause actual results to differ materially from our expectations and may adversely affect our business and results of operations, include, but are not limited to those items set forth in Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Risk Factors” appearing in our Annual Report on Form 10-K for the year ended December 31, 2007.

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 June 30,						Six Months Ended June 30,
	2008			2007			2008			2007

Revenue	$	65,619		$	58,832		$	130,364		$	116,479
Cost of services		57,205			50,295			112,367			99,032

Gross profit		8,414			8,537			17,997			17,447
Selling, general and administrative expenses		10,227			9,040			20,317			18,432
Impairment losses and restructuring charges		5,500			3,018			5,608			3,018

Operating loss		(7,313	)		(3,521	)		(7,928	)		(4,003	)
Net interest and other income		90			143			400			331

Loss before income taxes		(7,223	)		(3,378	)		(7,528	)		(3,672	)
Income tax (benefit) expense		(2,704	)		65			(2,678	)		(40	)

Net loss	$	(4,519	)	$	(3,443	)	$	(4,850	)	$	(3,632	)


Net loss per share:
Basic	$	(0.31	)	$	(0.23	)	$	(0.33	)	$	(0.25	)

Diluted	$	(0.31	)	$	(0.23	)	$	(0.33	)	$	(0.25	)

See notes to condensed consolidated financial statements.

STARTEK, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets
(Dollars in thousands, except share and per share data)


	As of
	June 30, 2008			December 31, 2007
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	15,682		$	23,026
Investments		17,672			16,349
Trade accounts receivable, less allowance for doubtful accounts of $0 and $0, respectively		49,828			48,887
Income tax receivable		4,039			2,502
Prepaid expenses and other current assets		2,659			2,408

Total current assets		89,880			93,172
Property, plant and equipment, net		57,102			57,532
Long-term deferred income tax assets		4,396			3,686
Other assets		1,058			1,068

Total assets	$	152,436		$	155,458


LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable	$	6,706		$	5,908
Accrued liabilities:
Accrued payroll		8,093			7,902
Accrued compensated absences		5,511			5,072
Other accrued liabilities		2,912			1,494
Current portion of long-term debt		3,649			3,975
Other current liabilities		1,338			2,632

Total current liabilities		28,209			26,983

Long-term debt, less current portion		5,744			7,380
Long-term deferred rent liability		4,924			2,731
Other liabilities		140			150

Total liabilities		39,017			37,244


Commitments and contingencies

Stockholders’ equity:
Common stock, 32,000,000 non-convertible shares, $0.01 par value, authorized; 14,778,591 and 14,735,791 shares issued and outstanding at June 30, 2008 and December 31, 2007, respectively		148			147
Additional paid-in capital		63,389			62,776
Cumulative translation adjustment		2,102			2,553
Unrealized loss on investments available for sale		(96	)		(29	)
Unrealized (loss) gain on derivative instruments		(21	)		20
Retained earnings		47,897			52,747

Total stockholders’ equity		113,419			118,214

Total liabilities and stockholders’ equity	$	152,436		$	155,458

See notes to condensed consolidated financial statements.

STARTEK, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows
(Dollars in thousands)
(Unaudited)


	Six Months Ended
	June 30,
	2008			2007
Operating Activities
Net loss	$	(4,850	)	$	(3,632	)
Adjustments to reconcile net loss to net cash provided by operating activities
Depreciation		9,085			8,429
Non-cash compensation cost		614			533
Impairment losses		4,070			3,018
Deferred income taxes		(1,612	)		1,272
Loss on sale of assets		16			3
Changes in operating assets and liabilities:
Trade accounts receivable, net		(863	)		5,771
Prepaid expenses and other assets		12			(41	)
Accounts payable		758			(1,723	)
Income taxes receivable, net		(1,532	)		(2,408	)
Accrued and other liabilities		3,895			1,635

Net cash provided by operating activities		9,593			12,857


Investing Activities
Purchases of investments available for sale		(10,899	)		(17,497	)
Proceeds from disposition of investments available for sale		9,469			6,869
Purchases of property, plant and equipment		(12,733	)		(6,141	)

Net cash used in investing activities		(14,163	)		(16,769	)


Financing Activities
Principal payments on borrowings		(2,179	)		(2,716	)
Principal payments on line of credit		(43,093	)		(1,877	)
Proceeds from line of credit		43,093			1,877
Principal payments on capital lease obligations		(25	)		—

Net cash used in financing activities		(2,204	)		(2,716	)
Effect of exchange rate changes on cash		(570	)		324

Net decrease in cash and cash equivalents		(7,344	)		(6,304	)
Cash and cash equivalents at beginning of period		23,026			33,437

Cash and cash equivalents at end of period	$	15,682		$	27,133


Supplemental Disclosure of Cash Flow Information
Cash paid for interest	$	348		$	411
Income taxes paid	$	1,384		$	1,143
Unrealized (loss) gain on investments available for sale, net of tax	$	(67	)	$	9
Property, plant and equipment acquired or refinanced under long-term debt	$	385		$	—

See notes to condensed consolidated financial statements.

STARTEK, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(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. These financial statements reflect all adjustments (consisting only of normal recurring entries, except as noted) which, in the opinion of management, are necessary for fair presentation. Operating results during the three and six months ended June 30, 2008, are not necessarily indicative of operating results that may be expected during any other interim period of 2008 or the year ending December 31, 2008.

The consolidated balance sheet as of December 31, 2007, 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, 2007.

Certain reclassifications have been made to 2007 information to conform to 2008 presentation.

Unless otherwise noted in this report, any description of “us” refers to StarTek, Inc. and our subsidiaries. The assets and liabilities of our foreign operations that are recorded in foreign currencies are translated into U.S. dollars at exchange rates prevailing at the balance sheet date. Revenues and expenses are translated at the weighted-average exchange rate during the reporting period.

Fair Value of Financial Instruments

We measure or monitor many assets and liabilities on a fair value basis. Fair value is used on a recurring basis for assets and liabilities in which fair value is the primary basis of accounting. Examples of these include derivative instruments, cash and cash equivalents, and available for sale securities. Additionally, fair value is used on a non-recurring basis to evaluate assets or liabilities for impairment or for disclosure purposes. Examples of these non-recurring uses of fair value include long-lived assets. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

We adopted the provisions of Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS No. 157”) related to financial assets and liabilities as well as other assets and liabilities carried at fair value on a recurring basis as of January 1, 2008 and the effect of such adoption was not material to our results of operations or financial position. FASB Staff Position No. 157-2 “Effective Date of FASB Statement No. 157” (“FSP No. 157-2”), deferred the effective date of SFAS No. 157 for all nonfinancial assets and nonfinancial liabilities to fiscal years beginning after November 15, 2008. We will adopt the provisions of SFAS No. 157 related to other nonfinancial assets and liabilities prospectively for our fiscal year beginning January 1, 2009.

Effective January 1, 2008, we adopted Statement of Financial Accounting Standards No. 159, “The Fair Value Option for Financial Assets and Liabilities” (“SFAS No. 159”). SFAS No. 159 provides companies with an option to report selected financial assets and liabilities at fair value, and establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. The adoption of SFAS No. 159 had no impact on our Condensed Consolidated Financial Statements as of June 30, 2008.


Level 1		Valuation is based upon quoted prices for identical instruments traded in active markets.

Level 2		Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market.

Level 3		Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.

When determining the fair value measurements for assets and liabilities required or permitted to be recorded at and/or marked to fair value, we consider the principal or most advantageous market in which it would transact and consider assumptions that market participants would use when pricing the asset or liability. When possible, we look to active and observable markets to price identical assets or liabilities. When identical assets and liabilities are not traded in active markets, we look to market observable data for similar assets and liabilities. Nevertheless, if certain assets and liabilities are not actively traded in observable markets, we must use alternative valuation techniques to derive a fair value measurement.

Recently Issued Accounting Pronouncements

In December 2007, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards No. 141 (revised 2007), “Business Combinations” (“SFAS No. 141R”). SFAS No. 141R establishes principles and requirements for how an acquirer in a business combination (i) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree, (ii) recognizes and measures the goodwill acquired in a business combination or a gain from a bargain purchase, and (iii) determines what information to disclose to enable users of financial statements to evaluate the nature and financial effects of the business combination. SFAS No. 141R will be applied prospectively to business combinations that have an acquisition date on or after January 1, 2009. The provisions of SFAS No. 141R will not impact our Condensed Consolidated Financial Statements for prior periods.

In March 2008, the FASB issued Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities, an amendment of SFAS No. 133” (“SFAS No. 161”). This statement will require additional disclosures about how and why we use derivative financial instruments, how derivative instruments and related hedged items are accounted for under SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities”, as amended and interpreted (“SFAS No. 133”), and how derivative instruments and related hedged items affect our financial position, results of operations, and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008; however early adoption is encouraged, as are comparative disclosures for earlier periods. We are currently evaluating the impact of adopting SFAS No. 161.

In May 2008, the FASB issued Statement of Financial Accounting Standards No. 162, “The Hierarchy of Generally Accepted Accounting Principles” (“SFAS No. 162”). SFAS No. 162 identifies the sources of accounting principles and the framework for selecting principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles in the United States. This statement shall be effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board’s amendments to AU section 411, “The Meaning of Present Fairly in Conformity with Generally Accepted Accounting Principles.” We are currently evaluating the impact of adopting SFAS No. 162.

2. IMPAIRMENT LOSSES AND RESTRUCTURING CHARGES

Impairment Losses

In accordance with Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets” (“SFAS No. 144”), we evaluate long-lived assets, including property, plant and equipment, for impairment on at least an annual basis and whenever events or changes in circumstances indicate that the carrying amounts of specific assets or a group of assets may not be recoverable. In accordance with SFAS No. 144, we analyze the projected undiscounted cash flows related to the assets and if they are less than the carrying value of the assets, we measure the impairment based on the excess of the carrying value of the long-lived asset over the long-lived asset’s fair value. Fair value is determined based upon the present value of the future cash flows. Our projections contain assumptions pertaining to anticipated levels of utilization and revenue that may or may not be under contract but are based on our experience and/or projections received from our customers.

During the second quarter of 2008, we recognized impairment losses of approximately $4.1 million. Approximately $1.5 million related to long-lived assets at certain Canadian locations in which the future cash flows were less than the carrying value of the assets. During the second quarter of 2008, we also recognized approximately $1.2 million in impairment losses related to the write-off of capitalized software costs for information technology infrastructure initiatives which management has decided to discontinue.

In June 2008, we announced plans to close our Big Spring, Texas facility effective August 18, 2008. In connection with this planned closure, we impaired approximately $1.1 million of leasehold improvements, furniture and fixtures and equipment related to this facility.

Hawkesbury Closure

In August 2007, we closed our facility in Hawkesbury, Ontario, Canada. We have recorded restructuring charges related to lease costs, telephony disconnects and other expenses related to the facility closure. In accordance with Statement of Financial Accounting Standards No. 146, “Accounting for Costs Associated with Exit or Disposal Activities” (“SFAS No. 146”), we recognized the liability when it was incurred, instead of upon commitment to a plan. During the second quarter of 2008, we revised our estimates regarding the ability to sublease the facility and as a result incurred $1.4 million in additional restructuring charges. In addition, we incurred approximately $0.3 million in impairment losses related to telephony equipment at the facility during the three months ended June 30, 2008.

The following table summarizes our restructuring accrual and related activity during the six months ended June 30, 2008:


	Facility-Related Costs
Balance as of January 1, 2008	$	502
Expense		1,538
Payments		(494	)

Balance as of June 30, 2008	$	1,546

We expect to incur total restructuring charges related to the Hawkesbury closure of approximately $2.3 million, of which approximately $494 was paid during the six months ended June 30, 2008 and $782 has been paid since commencement of the plan. This restructuring accrual is included in Other Accrued Liabilities in the accompanying Condensed Consolidated Balance Sheets. A significant assumption used in determining the amount of estimated liability for closing sites is the estimated liability for future lease payments on vacant facilities. If the assumptions regarding early termination and the timing and amounts of sublease payments prove to be inaccurate, we may be required to record additional losses, or conversely, a future gain, in our Condensed Consolidated Statements of Operations.

3. NET LOSS PER SHARE

Basic and diluted net loss 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:


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2008			2007			2008			2007

Net loss	$	(4,519	)	$	(3,443	)	$	(4,850	)	$	(3,632	)

Weighted average shares of common stock		14,706			14,696			14,706			14,696
Dilutive effect of stock options		—			—			—			—

Common stock and common stock equivalents		14,706			14,696			14,706			14,696



Net loss per basic share	$	(0.31	)	$	(0.23	)	$	(0.33	)	$	(0.25	)



Net loss per diluted share	$	(0.31	)	$	(0.23	)	$	(0.33	)	$	(0.25	)

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 and non-vested restricted stock using the treasury stock method. Anti-dilutive securities totaling 1,867 shares in the three and six months ended June 30, 2008, and 1,624 shares in the three and six months ended June 30, 2007, were not included in our calculation because of our net loss during the three and six months ended June 30, 2008 and 2007.

4. PRINCIPAL CLIENTS

The following table represents revenue concentration of our principal clients.


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2008			2007			2008			2007
AT&T, Inc.		51.7	%		52.5	%		50.6	%		52.7	%
T-Mobile, a subsidiary of Deutsche Telekom		28.6	%		20.5	%		28.2	%		20.0	%

On May 7, 2008, we entered into a work order pursuant to the Master Services Agreement (the “Work Order”) with AT&T Mobility LLC, a wholly-owned subsidiary of AT&T, Inc. (“AT&T”). The Work Order commenced May 1, 2008, continues through April 28, 2010, and covers the customer care and accounts receivable management services that we provide to AT&T. The Work Order is included as Exhibit 10.14 to this Form 10-Q. The contract covering business care services that we provide to AT&T was replaced in December 2006 with a contract that expires in November 2008. We entered into a services agreement and statement of work with T-Mobile for the provision of certain call center services, each being effective October 1, 2007 and continuing for two years.

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 June 30, 2008.

5. FAIR VALUE OF FINANCIAL INSTRUMENTS

Our financial instruments consist of cash and cash equivalents, investments, trade accounts receivable, accounts payable, derivative instruments, a line of credit and long-term debt. Carrying values of cash and cash equivalents, trade accounts receivable, and accounts payable approximate fair value due to the short term nature of these accounts. Investments and derivative instruments are reported at fair value. Management believes differences between the fair value and the carrying value of lines of credit and long-term debt are not material because interest rates approximate market rates for material items. As discussed in Note 1, “Basis of Presentation”, effective January 1, 2008, we adopted SFAS No. 157 and SFAS No. 159. In our adoption of SFAS No. 159, we did not identify any assets or liabilities, previously recorded at other than fair value, which we determined to begin measuring at fair value.

The following table summarizes our financial instruments measured at fair value as of June 30, 2008 and December 31, 2007.


	As of
	June 30, 2008				December 31, 2007
	Assets		Liabilities		Assets		Liabilities
Cash and cash equivalents	$	15,682	$	—	$	23,026	$	—
Investments		17,672		—		16,349		—
Derivative instruments		—		37		27		—

Total	$	33,354	$	37	$	39,402	$	—

Cash and Cash Equivalents

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. Included in cash and cash equivalents was commercial paper with a fair value of $12,351 and $13,079 as of June 30, 2008 and December 31, 2007, respectively. Commercial paper included in cash and cash equivalents as of June 30, 2008 and December 31, 2007 is highly liquid and has maturities of less than three months.

Investments

As of June 30, 2008, investments available for sale consisted of:


			Gross		Gross
			Unrealized		Unrealized			Fair
	Basis		Gains		Losses			Value
Corporate debt securities	$	16,798	$	3	$	(132	)	$	16,669
Government agency bonds		1,003		—		—			1,003

	$	17,801	$	3	$	(132	)	$	17,672

As of December 31, 2007, investments available for sale consisted of corporate debt securities with a basis of $16,412, gross unrealized gains of $59, gross unrealized losses of $122, and a fair value of $16,349. As of June 30, 2008, the basis of the investments in our portfolio have remaining contractual maturities as follows: $14,254 within one year and $3,547 in one to two years. We had no investments at June 30, 2008 or December 31, 2007, that had carried unrealized losses for longer than twelve months. Because we have the ability and intent to hold these investments until a market price recovery or maturity, these investments are not considered other-than-temporarily impaired.

Our corporate debt securities, government agency bonds and commercial paper are valued using third party broker statements. The value of the majority of our corporate debt securities and government agency bonds is derived from quoted market information. The inputs to the valuation are generally classified as Level 1 given the active market for these securities, however, if an active market does not exist, the inputs are recorded at a lower level in the fair value hierarchy. The value of commercial paper is derived from pricing models using inputs based upon market information, including face value, contractual terms and interest rates.

Derivative Instruments and Hedging Activities

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 six months ended June 30, 2008, these hedging commitments resulted in an unrealized gain, net of tax, of $71 and an unrealized loss, net of tax, of $41, respectively. During the three and six months ended June 30, 2007, these hedging commitments resulted in unrealized gains, net of tax, of $206 and $443, respectively, which have been recorded in other comprehensive income. We realized a gain of $26 and a loss of $182 during the three and six months ended June 30, 2008, and a gain of $324 during the three and six months ended June 30, 2007. The realized gains and losses were recognized in cost of services in our Condensed Consolidated Statements of Operations.

Our derivative instruments are valued using third party broker or counterparty statements. The value is derived from pricing models using inputs based upon market information, including contractual terms, market prices and yield curves.

Fair Value Hierarchy

The following table sets forth our financial instruments by level within the fair value hierarchy. As required by SFAS No. 157, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.


	Assets and Liabilities at Fair Value as of June 30, 2008
	Level 1		Level 2		Level 3		Total
Financial assets:
Commercial paper	$	—	$	12,351	$	—	$	12,351
Corporate debt securities		16,669		—		—		16,669
Mortgage backed securities		1,003		—		—		1,003

Total financial assets	$	17,672	$	12,351	$	—	$	30,023


Financial liabilities:
Derivative instruments	$	—	$	37	$	—	$	37

Total financial liabilities	$	—	$	37	$	—	$	37

6. COMPREHENSIVE LOSS

Statement of Financial Accounting Standards 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 (loss):


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2008			2007			2008			2007
Net loss	$	(4,519	)	$	(3,443	)	$	(4,850	)	$	(3,632	)
Other comprehensive income (loss):
Foreign currency translation adjustments, net of tax		(78	)		783			(451	)		907
Change in fair value of derivative instruments, net of tax		71			206			(41	)		443
Unrealized gain (loss) on available for sale securities, net of tax		153			23			(67	)		9

Comprehensive loss	$	(4,373	)	$	(2,431	)	$	(5,409	)	$	(2,273	)

7. SHARE-BASED COMPENSATION

On May 5, 2008, our stockholders approved the StarTek, Inc. 2008 Equity Incentive Plan (the “Plan”). The Plan replaced the StarTek, Inc. Stock Option Plan and StarTek, Inc. Directors’ Stock Option Plan (together, the “Prior Plans”). A total of 900,000 shares were authorized for grant under the Plan. In addition, a total of 274,298 shares remaining available for future grants under the Prior Plans are available for grant under the Plan. The types of awards that may be granted under the Plan include restricted stock awards, restricted stock unit awards, stock option awards, stock appreciation rights and performance units. The Compensation Committee (the “Committee”) also has the discretion to grant other types of awards, as long as they are consistent with the terms and purposes of the Plan. The awards granted under this Plan shall not expire more than ten years from the grant date. The Committee may determine the vesting conditions of awards; however, subject to certain exceptions, an award that is not subject to the satisfaction of performance measures may not fully vest or become fully exercisable earlier than three years from the grant date, and the performance period for an award subject to performance measures may not be shorter than one year.

Stock options granted to employees under the Plan vest as to 25% of the shares on the first anniversary of the date of grant and 2.0833% of the shares each month thereafter for 36 months. Restricted stock awards granted under the Plan vest as to one third of the shares on the first anniversary of the date of grant and one third of the shares each anniversary thereafter for three years. Stock options or restricted stock awards granted to our board of directors under the Plan vest as to 25% of the shares after three months from the date of grant, 25% of the shares after six months from the date of grant, 25% of the shares after nine months from the date of grant, and 25% of the shares after twelve months from the date of grant.

On May 5, 2008, our stockholders approved the StarTek, Inc. Employee Stock Purchase Plan (the “ESPP”). Under the ESPP, participants may purchase our common stock as of the last day of a purchase period at a price, which shall be no less than the lesser of (a) 85% of the closing price of a share of common stock on the first day of the purchase period; or (b) 85% of the closing price of a share of common stock on the last day of the purchase period. The purchase period is defined as each quarterly period commencing January 1 and ending March 31, or commencing April 1 and ending June 30, or commencing July 1 and ending September 30, or commencing October 1 and ending December 31, unless otherwise determined by the Committee. Our first purchase period commenced July 1, 2008.

The compensation cost that has been charged against income for the Plan, the Prior Plans, and for restricted stock awards granted outside of those plans (together, the “Plans”), for the three months ended June 30, 2008 and 2007, was $241 and $344, respectively, and is included in selling, general and administrative expense. The compensation cost that has been charged for the six months ended June 30, 2008 and 2007, was $614 and $533, respectively. The total income tax benefit recognized in our Condensed Consolidated Statements of Operations related to share-based compensation arrangements was $91 and $135 for the three months ended June 30, 2008 and 2007, and $230 and $202 for the six months ended June 30, 2008 and 2007, respectively. As of June 30, 2008, there was $4,766 of total unrecognized compensation cost related to nonvested share-based compensation arrangements granted under the Plans. That cost is expected to be recognized over a weighted-average period of 3.17 years.

Stock Options

A summary of option activity under the Plans as of June 30, 2008, and changes during the six months then ended is presented below:


						Weighted Average		Aggregate
				Weighted Average		Remaining		Intrinsic Value
	Shares			Exercise Price		Contractual Term (yrs)		(000s)
Outstanding as of January 1, 2008		1,620,342		$	12.50
Granted		399,000			9.01
Exercised		—			—
Forfeited		(224,972	)		11.00

Outstanding as of June 30, 2008		1,794,370		$	11.91		8.47	$	159

Exercisable as of June 30, 2008		533,383		$	16.81		6.97	$	—

The weighted average grant date fair value of options granted during the three and six months ended June 30, 2008 was $3.47 for both periods. The weighted average grant date fair value of options granted during the three and six months ended June 30, 2007 was $3.96 and $4.19, respectively. No options were exercised during the six months ended June 30, 2008 or 2007.

The assumptions used to determine the value of our stock options under the Black-Scholes method are summarized below:


	Three Months Ended June 30,		Six Months Ended June 30,
	2008	2007	2008	2007
Risk-free interest rate	2.85%-3.60%	4.56% - 4.58%	2.76%-3.60%	4.56% - 4.74%
Dividend yield	0%	0%	0%	0%
Expected volatility	44.38%-45.13%	43.97% - 50.47%	43.81%-45.13%	43.97% - 50.47%
Expected life in years	4.1	4.1	4.1	4.4

The risk-free interest rate for periods within the contractual life of the option is based on either the four year, five year or seven year U.S. Treasury strip yield in effect at the time of grant. Expected life and volatilities are based on historical experience, which we believe will be indicative of future experience.

The total fair value of shares vested during the three and six months ended June 30, 2008 was $465 and $1,092, respectively. The total fair value of shares vested during the three and six months ended June 30, 2007 was $176 and $285, respectively.

Restricted Shares

Restricted share activity during the six months ended June 30, 2008 was as follows:


	Restricted Shares			Grant Date Fair Value
Nonvested balance as of January 1, 2008		40,000		$	12.37
Granted		47,800			9.01
Vested		(10,000	)		13.14
Forfeited		(5,000	)		9.01

Nonvested balance as of June 30, 2008		72,800		$	10.29

8. INCOME TAXES

The year-to-date effective tax rate increased from 1.1% during the six months ended June 30, 2007 to 35.6% during the six months ended June 30, 2008. The primary difference between the periods was the valuation allowance recorded in 2007 on capital loss carryforwards which management did not believe would be recognized before their expiration. No such allowance was recorded during 2008. In addition, during 2008 there was a change in the Canadian statutory tax rate. Effective January 1, 2008, the general corporate income tax rate was reduced from 22.1% to 19.5% due in part to the elimination of the corporate surtax on large corporations of 1.12%. The impact was a reduction in our overall effective tax rate and a reduction of the value of certain deferred tax assets. The net impact of this change was $403 of additional income tax expense for the six months ended June 30, 2008.

Differences between U.S. statutory income tax rates and our effective tax rates for the six months ended June 30, 2008 and 2007 were:


	Six Months Ended June 30,
	2008			2007
U.S. statutory tax rate		35.0	%		35.0	%
Effect of state taxes (net of Federal benefit)		1.6	%		5.2	%
Work opportunity credits		7.4	%		9.9	%
Effect of change in Canadian tax rate		(5.4	%)		0.0	%
Capital loss valuation allowance		0.0	%		(48.8	%)
Other, net		(3.0	%)		(0.2	%)

Total		35.6	%		1.1	%

9. LITIGATION

StarTek and six of its 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. Those actions have been consolidated by the federal court. The consolidated 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 consolidated complaint alleges 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 SEC and in press releases issued during the Class Period, and that as a result, the market price of our common stock was artificially inflated. 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. On May 23, 2006, we and the individual defendants moved the court to dismiss the action in its entirety. On March 28, 2008, the motion was denied with respect to the claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, except the claim under Section 20(a) of the Securities Exchange Act of 1934 was dismissed against two of the individual defendants. On the same date, the motion was granted with respect to the claims under Sections 11 and 15 of the Securities Act of 1933 without prejudice to plaintiffs filing an amended complaint with respect to such claims. On May 19, 2008, the plaintiffs filed an amended complaint. On June 5, 2008, we and the individual defendants moved the court to dismiss the amended complaint in its entirety. We believe we have valid defenses to the claims and intend to defend the litigation vigorously.

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. We expect the carriers to provide for certain defense costs and, if needed, indemnification with a reservation of rights. 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. These policies provide that we are responsible for the first $1.025 million in defense costs. We have incurred defense costs related to these lawsuits in excess of our $1.025 million deductible.

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.

10. SUBSEQUENT EVENTS

On July 3, 2008, we entered into a lease agreement for the rental of a facility in Makati City, Philippines. The lease has a term of ten years. The facility is approximately 78,000 square feet and we expect to open the facility for operations during the fourth quarter of 2008. Total lease commitments for rental of this facility are approximately $9.7 million over the term of the lease.

On August 4, 2008, we opened a facility in Jonesboro, Arkansas. The facility is approximately 55,000 square feet and is leased through July 1, 2015.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with our Unaudited Consolidated Financial Statements and related Notes included elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2007, and with the information under the heading “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, 2007.

Unless otherwise noted in this report, any description of “us” or “we” refers to StarTek, Inc. and our subsidiaries. Financial information in this report is presented in U.S. dollars.

BUSINESS DESCRIPTION AND OVERVIEW

StarTek is a provider of business process outsourcing services to the communications industry. We partner with our clients to meet their business objectives and improve customer retention, increase revenues and reduce costs through an improved customer experience. Our solutions leverage industry knowledge, best business practices, skilled agents, proven operational excellence and flexible technology. The StarTek comprehensive service suite includes customer care, sales support, complex order processing, accounts receivable management, technical support and other industry-specific processes. We provide these services from 21 operational facilities in the U.S. and Canada.

Our business is providing high-end customer service offerings through the effective deployment of people and technology such that our clients can focus on their core business and preserve capital. Our service offering includes customer care, sales support, complex order processing, accounts receivable management and other industry-specific processes. We are well positioned to help our clients implement the convergence of product lines, including wire-line, wireless, cable and broadband. Under each service offering, we deliver a transparent extension of our clients’ brands. Our success is driven by our people, who we believe are industry trained experts in providing the communications industry with proven business practices and solutions to help our clients achieve their business goals. Our ability to deliver exceptional service to our clients is enhanced by our technology infrastructure. Through our technology, we are able to rapidly respond to ever-changing client demands in a tailored, yet cost-effective and efficient manner. We are capable of handling large call volumes at each of our contact centers through our reliable and scalable contact center solutions. We staff our IT personnel such that we can support our infrastructure and still have the capability to design programs to meet the specific needs of our clients.

We endeavor to achieve site optimization at all of our locations by routinely evaluating site performance. If local economic conditions, prevailing wage rates, or other factors, negatively impact the long-term financial viability of a location, management will from time to time make the decision to close a facility. As a result, we may incur impairment losses or restructuring charges in connection with the closure. Likewise, management is continually in pursuit of opportunities to open new locations in economically viable geographic markets in order to improve profitability and grow the business.

SIGNIFICANT DEVELOPMENTS DURING THE THREE MONTHS ENDED JUNE 30, 2008

In June 2008, we announced plans to close our Big Spring, Texas facility effective August 18, 2008.

SUBSEQUENT EVENTS

On August 4, 2008, we opened a facility in Jonesboro, Arkansas. The facility is approximately 55,000 square feet and is leased through July 1, 2015.

RESULTS OF OPERATIONS — THREE MONTHS ENDED JUNE 30, 2008 AND JUNE 30, 2007


	Three Months						Three Months						% change
	Ended June 30,			% of			Ended June 30,			% of			Q2 2007 to
	2008			Revenue			2007			Revenue			Q2 2008
Revenue	$	65,619			100.0	%	$	58,832			100.0	%		11.5	%
Cost of services		57,205			87.2	%		50,295			85.5	%		13.7	%

Gross profit		8,414			12.8	%		8,537			14.5	%		-1.4	%
Selling, general and administrative expenses		10,227			15.6	%		9,040			15.4	%		13.1	%
Impairment losses and restructuring charges		5,500			8.3	%		3,018			5.1	%		82.2	%

Operating loss		(7,313	)		-11.1	%		(3,521	)		-6.0	%		107.7	%
Net interest and other income		90			0.1	%		143			0.2	%		-37.1	%

Loss before income taxes		(7,223	)		-11.0	%		(3,378	)		-5.8	%		113.8	%
Income tax (benefit) expense		(2,704	)		-4.1	%		65			-0.1	%		-4260.0	%

Net loss	$	(4,519	)		-6.9	%	$	(3,443	)		-5.9	%		31.3	%

Revenue

Revenue increased 11.5% from $58.8 million in the second quarter of 2007 to $65.6 million in the second quarter of 2008. The increase was due primarily to revenue generated at our new sites in Victoria, Texas and Mansfield, Ohio which opened during 2008. Revenue generated by these two sites totaled approximately $5.9 million during the second quarter of 2008, partially offset by a $2.6 million revenue decrease related to the loss of a client in early 2008. The remaining revenue increase, approximately $3.5 million, was due to improved pricing and an increase in volume on other contracts.

Cost of Services and Gross Profit

Cost of services increased 13.7% from $50.3 million in the second quarter of 2007 to $57.2 million in the second quarter of 2008. The increase in cost of services was due in part to $5.7 million in cost of services related to the opening of our new facilities in Victoria, Texas and Mansfield, Ohio. We incurred additional fixed and variable costs related to the build-out of these facilities including hiring costs, rental costs and other expenses related to the opening of these sites. Our gross profit margin decreased in the second quarter of 2008 to 12.8%, compared to 14.5% in the second quarter of 2007. Gross profit margin decreased due to certain operational issues at existing U.S. site locations, the loss of a profitable client and the weakening of the U.S. dollar compared to the Canadian dollar. These declines to gross profit margin were partially offset by increases related to better pricing on certain contracts and the closure of our Hawkesbury, Ontario, Canada site in August 2007, which was a drain on margins during the second quarter of 2007.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased 13.1% from $9.0 million in the second quarter of 2007 to $10.2 million during the second quarter of 2008, and as a percentage of revenue increased from 15.4% in 2007 to 15.6% in 2008. Investments in human resources, technology and process improvements, in support of our long-term growth objectives established during 2007 accounted for the increase. We also incurred incremental costs associated with our new site expansion in Victoria, Mansfield and the Philippines and incurred approximately $0.5 million in severance expense related to the departure of our Chief Operating Officer.

Impairment Losses and Restructuring Charges

Impairment losses and restructuring charges increased from $3.0 million in the second quarter of 2007 to $5.5 million in the second quarter of 2008. During the second quarter of 2007, we incurred impairment charges of $1.3 million related to impairment of property, plant and equipment at our Hawkesbury, Ontario, Canada site which closed in August 2007 and $1.7 million related to the write-off of certain capitalized software costs. During the second quarter of 2008, we incurred approximately $4.1 million in impairment losses. A portion of these losses, $1.5 million, was due to the impairment of long-lived assets at certain Canadian locations for which expected future cash flows do not support the current carrying value. In addition, we recorded $1.2 million in impairment losses related to the write-off of the remainder of certain capitalized software costs for an enterprise resource planning system, which we intend to replace with a new system to support future growth. Finally, we recorded $1.1 million related to the impairment of property, plant and equipment at our Big Spring, Texas location which is expected to close in August 2008. The expected closure of our Big Spring, Texas facility was driven by market conditions, namely recruiting challenges in this location, which impacted the profitability of the site and management determined it was in our long-term interest to close the location. In addition, we incurred approximately $1.4 million in restructuring charges and $0.3 million in asset impairment losses related to the August 2007 Hawkesbury, Ontario, Canada site closure, due to a change in the expectation of our ability to sublease that facility.

Operating Loss

We incurred operating losses of approximately $7.3 million and $3.5 million for the three months ended June 30, 2008 and 2007, respectively. The increase in the loss was driven by the decrease in gross margin, the increase in selling, general and administrative expenses, and the increase in impairment losses and restructuring charges, as discussed previously.

Income Tax

The quarterly effective tax rate increased from 1.9% in the second quarter of 2007 to 37.4% in the second quarter of 2008. The primary difference between the periods was the valuation allowance recorded in 2007 on capital loss carryforwards which management did not believe would be recognized before their expiration. No such allowance was recorded during 2008. In addition, during 2008 there was a change in the Canadian statutory tax rate. Effective January 1, 2008, the general corporate income tax rate was reduced from 22.1% to 19.5% due in part to the elimination of the corporate surtax on large corporations of 1.12%.

Net Loss

We incurred net losses of approximately $4.5 million and $3.4 million for the three months ended June 30, 2008 and 2007, respectively. The increase in the net loss was driven primarily by decreased gross margin, the increase in selling, general and administrative expenses, and increased impairment losses and restructuring charges, partially offset by an income tax benefit, as discussed previously.

RESULTS OF OPERATIONS — SIX MONTHS ENDED JUNE 30, 2008 AND JUNE 30, 2007


													% change
	Six MonthsEnded						Six Months Ended						YTD June
	June 30,			% of			June 30,			% of			30, 2007 to
	2008			Revenue			2007			Revenue			2008
Revenue	$	130,364			100.0	%	$	116,479			100.0	%		11.9	%
Cost of services		112,367			86.2	%		99,032			85.0	%		13.5	%

Gross profit		17,997			13.8	%		17,447			15.0	%		3.2	%
Selling, general and administrative expenses		20,317			15.6	%		18,432			15.8	%		10.2	%
Impairment losses and restructuring charges		5,608			4.3	%		3,018			2.6	%		85.8	%

Operating loss		(7,928	)		-6.1	%		(4,003	)		-3.4	%		98.1	%
Net interest and other income		400			0.3	%		331			0.3	%		20.8	%

Loss before income taxes		(7,528	)		-5.8	%		(3,672	)		-3.1	%		105.0	%
Income tax benefit		(2,678	)		-2.1	%		(40	)		0.0	%		6595.0	%

Net loss	$	(4,850	)		-3.7	%	$	(3,632	)		-3.1	%		33.5	%

Revenue

Revenue increased 11.9% from $116.5 million during the six months ended June 30, 2007 to $130.4 million during the six months ended June 30, 2008. Revenue increased related to the opening of our Victoria, Texas and Mansfield, Ohio sites which contributed approximately $8.9 million in additional revenue during the six months ended June 30, 2008, as well as the re-opening of our Petersburg, Virginia facility which was closed for a portion of 2007 and contributed approximately $3.8 million in additional revenue. In addition, revenue increased year-over-year due to improved pricing on several contracts. These increases were offset by decreased revenue due to a lost client and the closure of our Hawkesbury, Ontario, Canada site in August 2007.

Cost of Services and Gross Profit

Cost of services increased 13.5% from $99.0 million during the six months ended June 30, 2007 to $112.4 million during the six months ended June 30, 2008. The increase in cost of services was due in part to $8.9 million in cost of services related to the opening of our new facilities in Victoria, Texas and Mansfield, Ohio. We incurred additional fixed and variable costs related to the build-out of these facilities including hiring costs, rental costs and other expenses related to the opening of the sites. These factors also resulted in a reduction of our gross profit margin which declined from 15.0% for the six months ended June 30, 2007 to 13.8% for the six months ended June 30, 2008. The weakening of the U.S. dollar compared to the Canadian dollar during 2008 and the loss of a profitable client also negatively impacted our gross profit margin. These decreases to gross profit were partially offset by the improved pricing on several contracts.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased 10.2% from $18.4 million during the six months ended June 30, 2007 to $20.3 million during the six months ended June 30, 2008, but as a percentage of revenue decreased slightly from 15.8% in 2007 to 15.6% in 2008. The dollar increase was due to our investments in human resources, technology and process improvements, in support of our long-term growth objectives established during 2007.

Impairment Losses and Restructuring Charges

Impairment losses and restructuring charges increased from $3.0 million during the six months ended June 30, 2007 to $5.6 million during the six months ended June 30, 2008. During the six months ended June 30, 2007, we incurred impairment charges of $1.3 million related to impairment of property, plant and equipment at our Hawkesbury, Ontario, Canada site which closed in August 2007 and $1.7 million related to the write-off of certain capitalized software costs. During the six months ended June 30, 2008, we incurred approximately $4.1 million in impairment losses. A portion of these losses, $1.5 million, related to the impairment of long-lived assets at certain Canadian locations for which the expected future cash flows do not support the current carrying value. In addition, we recorded $1.2 million in impairment losses related to the write-off of the remainder of certain capitalized software costs for an enterprise resource planning system, which we intend to replace with a new system to support future growth. Finally, we recorded $1.1 million related to the impairment of property, plant and equipment at our Big Spring, Texas location which is expected to close in August 2008. The expected closure of our Big Spring, Texas facility was driven by market conditions, namely recruiting challenges at this location, which impacted the profitability of the site and management determined it was in our long-term interest to close the location. In addition, during the six months ended June 30, 2008 we incurred approximately $1.5 million in restructuring charges and $0.3 million in asset impairment losses related to the August 2007 Hawkesbury, Ontario, Canada site closure due to a change in the expectation of our ability to sublease that facility.

Operating Loss

We incurred operating losses of approximately $7.9 million and $4.0 million for the six months ended June 30, 2008 and 2007, respectively. The increase in the loss was driven by the decrease in gross margin, the increase in selling, general and administrative expenses, and the impairment losses and restructuring charges, discussed previously.

Income Tax

Net Loss

We incurred net losses of approximately $4.9 million and $3.6 million for the six months ended June 30, 2008 and 2007, respectively. The increase in the net loss was driven primarily by decreased gross margin, the increase in selling, general and administrative expenses, and increased impairment losses and restructuring charges, partially offset by an income tax benefit, as discussed previously.

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2008, working capital totaled $61.7 million and our current ratio was 3.19:1, compared to working capital of $66.2 million and a current ratio of 3.45:1 at December 31, 2007. 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 typically relate to capital expenditures to upgrade our existing information technologies and service offerings, investments in our facilities and, historically, the payment of dividends. We believe that cash flows from operations and cash provided by short-term borrowings, when necessary, will adequately meet our ongoing operating requirements and scheduled principal and interest payments on existing debt. Any significant future expansion of our business may require us to secure additional cash resources. Our liquidity could be significantly impacted by large cash requirements to expand our business or 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 “Risk Factors” section in our Annual Report on Form 10-K for the year ended December 31, 2007.


	Six Months Ended June 30,
	2008			2007
Net cash provided by (used in):
Operating activities	$	9,593		$	12,857
Investing activities		(14,163	)		(16,769	)
Financing activities		(2,204	)		(2,716	)
Effect of foreign exchange rates on cash		(570	)		324

Net decrease in cash and cash equivalents	$	(7,344	)	$	(6,304	)

Our balance of cash and cash equivalents was $15.7 million at June 30, 2008, compared to a balance of $23.0 million at December 31, 2007.

Operating Activities. Net cash provided by operating activities was $9.6 million for the six months ended June 30, 2008, a decrease of approximately $3.3 million from $12.9 million for the six months ended June 30, 2007. The decrease was due primarily to $1.2 million in additional net losses, $6.6 million related to lower collections of accounts receivable due to the timing of payments, and a $2.9 million increase in deferred tax assets primarily due to larger impairment and restructuring charges, stock compensation expense and depreciation expense. Our accounts receivable balance can fluctuate significantly period to period because the majority of our billings occur monthly with large customers whereby, the timing of collection on those receivables can result in significant fluctuations in our accounts receivable balance. These decreases to cash provided by operating activities were offset by an increase in non-cash charges including greater depreciation expense of $0.7 million due to new site openings and greater impairment losses of approximately $1.1 million. The decrease in cash provided by operating activities was also offset by increased cash resulting from larger accounts payable and accrued liabilities balances, totaling $4.7 million, which was driven by payables and payroll accruals for the new sites, and accrued severance related to the departure of our Chief Operating Officer.

Investing Activities. Net cash used in investing activities decreased by approximately $2.6 million from $16.8 million during the six months ended June 30, 2007 to $14.2 million during the six months ended June 30, 2007. The decline in cash used in investing activities was due to a decrease in purchases of investments available for sale. Purchases of investments available for sale, net of proceeds, decreased from $10.6 million during the six months ended June 30, 2007 to $1.4 million during the six months ended June 30, 2008. This was offset by higher purchases of property, plant and equipment, which increased by approximately $6.6 million during the six months ended June 30, 2008, compared to the same period in 2007. The increase in purchases of property, plant and equipment is the result of investments made in new sites.

Financing Activities. Net cash used in financing activities decreased by approximately $0.5 million from $2.7 million during the six months ended June 30, 2007 to $2.2 million during the six months ended June 30, 2008. The decrease was due entirely to lower principal payments on our borrowings.

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 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, other than the Canadian Dollar Secured Equipment Loan and the Secured Promissory Note, as described below. The following table presents a summary (in thousands), by period, of the future contractual obligations and payments we have entered into as of June 30, 2008:


	Less Than		One to Three		Three to Five		More Than
	One Year		Years		Years		Five Years		Total
Operating leases ⁽¹⁾	$	5,629	$	10,636	$	6,263	$	1,873	$	24,401
Capital leases ⁽²⁾		68		152		140		—		360
Purchase obligations ⁽³⁾		731		31		—		—		762
Long-term debt⁽⁴⁾		3,581		5,452		—		—		9,033
Total contractual obligations	$	10,009	$	16,271	$	6,403	$	1,873	$	34,556


(1)		We lease facilities and equipment under various non-cancelable operating leases.

(2)		We lease equipment under certain capital lease agreements.

(3)		Purchase obligations include commitments to purchase goods and services that in some cases may include provisions for cancellation.

(4)		Our outstanding debt obligations as of June 30, 2008 are described below.

Line of Credit

We maintain a $10.0 million secured line of credit with Wells Fargo Bank, N.A. (the “Bank”) which we use to finance regular, short-term operating expenses. The line of credit expires June 30, 2009. Effective June 30, 2008, we entered into the Fifth Amendment to the Credit Agreement (the “amendment”). Under the amendment, 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, when our total tangible net worth is $110 million or greater. If our total tangible net worth is less than $110 million, borrowings under this line of credit bear interest at either a fluctuating rate per annum that is 0.75% below the Prime Rate or at a fixed rate per annum determined by the Bank to be 1.75% above LIBOR. The interest rate on this facility was 4.0% as of June 30, 2008. Under the amendment, at the end of each fiscal quarter, we must maintain a tangible net worth of $105 million plus 25% of net income (only if positive) for each fiscal quarter, beginning with the first quarter of 2008. Our previous covenant regarding minimum profit after taxes was deleted. We also must maintain unencumbered liquid assets having an aggregate fair market value of not less than $10 million measured at the end of each fiscal quarter. Due to our net loss during the second quarter of 2008, we were out of compliance with our prior covenant restricting a net loss in the period. We obtained a waiver of this covenant from the Bank and the covenants were amended as described above. In connection with the amendment, we also granted the Bank a security interest in all of our accounts receivable, other rights to payment and general intangibles, including those of our subsidiary, StarTek USA, Inc. There was no balance outstanding on this line of credit as of June 30, 2008.

Canadian Dollar Secured Equipment Loan

On November 17, 2006, StarTek Canada Services, Ltd., one of our subsidiaries, borrowed approximately $9.6 million Canadian dollars from Wells Fargo Equipment Finance Company, Inc. These borrowings are guaranteed by StarTek, Inc. and our subsidiary, StarTek USA, Inc., and are secured by fixed assets and tenant improvements at certain of our Canadian facilities. Under the guarantee agreement, if StarTek Canada Services, Ltd. fails to pay its obligations under the loan agreement when due, the loan guarantors agree to punctually pay any indebtedness, along with interest and certain expenses incurred on behalf of Wells Fargo Equipment Finance Company, Inc. to enforce the guarantee, to Wells Fargo Equipment Finance Company, Inc. The loan will be repaid in 48 monthly installments of $0.225 million until maturity on November 20, 2010, which reflects an implicit annual interest rate of 5.77%. We may elect to prepay amounts due under this loan, provided that we give Wells Fargo Equipment Finance Company, Inc. at least 30 days written notice and that we pay a prepayment premium, as stipulated in the loan agreement. As of June 30, 2008, approximately $5.9 million U.S. dollars were outstanding under this loan.

Secured Promissory Note

On November 17, 2006, our subsidiary, StarTek USA, Inc., borrowed approximately $4.9 million from Wells Fargo Equipment Finance, Inc. The loan will be repaid with interest in 48 monthly installments of $0.115 million until maturity on November 30, 2010. The borrowings bear interest at an annual rate of 6.38% and are secured by fixed assets and tenant improvements at certain of our U.S. facilities. The borrowings may be repaid early without penalty. The promissory note is guaranteed by StarTek, Inc. and our subsidiary, StarTek Canada Services, Ltd. Under the guarantee agreement, if StarTek USA, Inc. fails to pay its obligations under the loan agreement when due, the guarantors agree to full and prompt payment of each and every debt, liability and obligation of every type and description that StarTek USA, Inc. may now or in the future owe. As of June 30, 2008, approximately $3.1 million was outstanding under this note.

Other Factors Impacting Liquidity. Effective November 4, 2004, our board of directors authorized purchases of up to $25.0 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 Chief Financial Officer consistent with the guidelines adopted by the board of directors and will depend on market conditions and other factors. Any repurchased shares will be made in accordance with SEC rules. We have not yet repurchased any shares pursuant to this board authorization.

Our business currently has a high concentration of 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. These client relationships are further discussed in Note 4 “Principal Clients,” to our Condensed Consolidated Financial Statements, which are included at Item 1, “Financial Statements”, of this Form 10-Q. 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 June 30, 2008.

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 only to the extent that our clients’ marketing programs and product launches are geared toward the holiday buying season. 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) timing and amount of costs incurred to expand capacity in order to provide for volume growth from existing and future clients; (ii) changes in the volume of services provided to principal clients; (iii) expiration or termination of client projects or contracts; (iv) timing of existing and future client product launches or service offerings; (v) seasonal nature of certain clients’ businesses; and (vi) cyclical nature of certain clients’ businesses.

Because we service relatively few, large clients, the availability of cash is highly dependent on the timing of cash receipts from accounts receivable. As a result, from time to time, we borrow cash from our line of credit to cover short-term cash needs. These borrowings are typically outstanding for a short period of time before they are repaid. However, our debt balance can fluctuate significantly during any given quarter as part of our ordinary course of business. Accordingly, our debt balance at the end of any given quarter is not necessarily indicative of the debt balance at any other time during that period.

CRITICAL ACCOUNTING POLICIES AND 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 policies and estimates are consistent with those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2007. 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, 2007, for a complete description of our Critical Accounting Policies and Estimates.

Recently Adopted Accounting Pronouncements

Effective January 1, 2008, we adopted Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS No. 157”). SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. We adopted those provisions related to financial assets and liabilities as well as other assets and liabilities carried at fair value on a recurring basis. FASB Staff Position No. 157-2 “Effective Date of FASB Statement No. 157” (“FSP No. 157-2”), deferred the effective date of SFAS No. 157 for all nonfinancial assets and nonfinancial liabilities to fiscal years beginning after November 15, 2008. We will adopt the provisions of SFAS No. 157 related to other nonfinancial assets and liabilities prospectively for our fiscal year beginning January 1, 2009. The adoption of SFAS No. 157 had no impact on our Condensed Consolidated Financial Statements as of June 30, 2008, however, we have provided additional disclosures in accordance with this statement included in Note 5, “Fair Value of Financial Instruments” to our Condensed Consolidated Financial Statements.

SFAS No. 157 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). When determining the fair value measurements for assets and liabilities required or permitted to be recorded at and/or marked to fair value, we consider the principal or most advantageous market in which it would transact and consider assumptions that market participants would use when pricing the asset or liability. When possible, we look to active and observable markets to price identical assets or liabilities. When identical assets and liabilities are not traded in active markets, we look to market observable data for similar assets and liabilities. Nevertheless, if certain assets and liabilities are not actively traded in observable markets, we must use alternative valuation techniques to derive a fair value measurement.

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES 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, and foreign currency exchange rates. This information should be read in conjunction with information set forth in Part II, Item 7A in our Annual Report on Form 10-K for the year ended December 31, 2007, in addition to the interim unaudited consolidated financial statements, accompanying notes and management’s discussion and analysis of financial condition and results of operations presented in Items 1 and 2 of this Quarterly Report on Form 10-Q.

Interest Rate Risk

We are exposed to interest rate risk with respect to our cash and cash equivalents, investments and debt obligations. 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. At June 30, 2008, investments available for sale consisted of corporate debt securities and government agency bonds. 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. 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.

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. Approximately 34.5% of our operating expenses, excluding impairment losses and restructuring charges, in the second quarter of 2008 were incurred by our Canadian operations. A portion of our Canadian operations generate revenues denominated in U.S. dollars. To hedge our exposure to fluctuations in the Canadian dollar relative to the U.S. dollar we enter into forward purchase contracts. During the second quarter of 2008, we entered into forward contracts for $15.3 million Canadian dollars to hedge our foreign currency risk with respect to these labor costs. As of June 30, 2008, we had $.04 million in derivative liabilities and related tax benefit of $0.01 million which is expected to settle within the next twelve months. As of June 30, 2008, we had contracted to purchase $20.3 million Canadian dollars to be delivered periodically through December 2008 at a purchase price which is no more than $20.3 million and no less than $18.8 million.

During the three and six months ended June 30, 2008, there were no other material changes in our market risk exposure. For a complete discussion of our market risk associated with foreign currency and interest rate risk as of December 31, 2007, see Item 7A. “Quantitative and Qualitative Disclosures about Market Risk” in our Annual Report on Form 10-K for the year ended December 31, 2007.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures. As of June 30, 2008, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of 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 such evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of June 30, 2008, our disclosure controls and procedures were effective and were designed to ensure that all information required to be disclosed by us in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and accumulated and communicated to our management, including our principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure.

Changes in internal controls over financial reporting. There was no change in our internal control over financial reporting that occurred during the quarter ended June 30, 2008, 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

ITEM 1A. RISK FACTORS

There have been no material changes in our risk factors from those disclosed in our 2007 Annual Report on Form 10-K, except for the modifications reflected in the risk factors listed below.

Our operations outside of the USA subject us to the risk of currency exchange fluctuations.

Because we conduct a material portion of our business in Canada and are expanding our operations to other locations outside of the USA, we are exposed to market risk from changes in the value of the Canadian dollar and the currencies of other foreign countries in which we operate. Material fluctuations in exchange rates impact our results through translation and consolidation of the financial results of our foreign operations, and therefore may negatively impact our results of operations and financial condition. Our results of operations have been negatively impacted by the increase in the value of the Canadian dollar in relation to the value of the U.S. dollar during 2007, 2006 and 2005, because we have contracts wherein the revenue we earn is denominated in U.S. dollars, yet the costs we incur to fulfill our obligations under those contracts are denominated in Canadian dollars. During 2007, 2006 and 2005, we engaged in limited hedging activities relating to our exposure to such fluctuations in the value of the Canadian dollar versus the U.S. dollar. We intend to continue hedging activities in 2008. However, currency hedges do not, and will not, eliminate our exposure to fluctuations in the Canadian dollar. Further increases in the value of the Canadian dollar, or currencies in other foreign countries in which we may operate, in relation to the value of the U.S. dollar, will further increase such costs and may adversely affect our results of operations.

We face risks inherent in conducting business outside of North America.

Our operations in Canada accounted for 39.1%, 43.7% and 41.6% of our revenue in 2007, 2006 and 2005 respectively. We are opening a new facility in the Philippines. There are risks inherent in conducting business internationally, including competition from local businesses or established multinational companies, who may have firmly established operations in particular foreign markets. This may give these firms an advantage regarding labor and material costs. Other risks inherent in conducting business internationally include potentially longer working capital cycles, unexpected changes in foreign government programs, policies, regulatory requirements, and labor laws, and difficulties in staffing and effectively managing foreign operations. Our current or potential new clients may be reluctant to have us provide services to them from a location outside of North America. One or more of these factors may have an impact on our international operations. Our lack of significant international operating experience may result in any of these factors impacting us to a greater degree than they impact our competitors. To the extent one or more of these factors impact our international operations, it could adversely affect our business, results of operations, growth prospects, and financial condition as a whole.

Various risk factors described in our 2007 Annual Report on Form 10-K may be exacerbated with regard to international operations, especially in countries where we do not have well-established operations, such as risks related to the need to retain key management personnel, the inability to hire and retain qualified employees, increases in operating costs, facility capacity utilization, management of growth and costs related to growth, geopolitical military conditions, interruptions to our business, and the cost or significant interruptions in telephone and data services.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The annual meeting of stockholders of StarTek, Inc. was held on May 5, 2008. Stockholders were invited to vote, by proxy or in person, for or against four items. The results of the vote were as follows:


					Abstain/
	For		Against		Withhold		Broker Non-Vote

Election of Directors
Ed Zschau		13,461,136		—		716,129
P. Kay Norton		13,466,190		—		711,075
Albert C. Yates		13,452,040		—		725,225
A. Laurence Jones		13,945,775		—		231,490
Harvey A. Wagner		13,953,179		—		224,086

Ratify Appointment of Ernst & Young LLP
as independent registered public accounting firm of the company for the year ending December 31, 2008		14,149,617		22,938		4,710

Approve the StarTek, Inc. Employee Stock Purchase Plan
		12,122,593		72,847		53,400		1,928,425

Approve the StarTek, Inc. 2008 Equity Incentive Plan
		11,341,927		851,617		55,296		1,928,425

ITEM 6. EXHIBITS

An Index of Exhibits follows the signature pages of this Form 10-Q.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.

STARTEK, INC.
(REGISTRANT)


By:	/s/ A. LAURENCE JONES	Date: August 11, 2008

	A. Laurence Jones
	President and Chief Executive Officer
	(Principal Executive Officer)

By:	/s/ DAVID G. DURHAM	Date: August 11, 2008

	David G. Durham
	Executive Vice President, Chief Financial
	Officer and Treasurer
	(Principal Financial and Accounting Officer)

EXHIBIT INDEX

Incorporated Herein by Reference

Exhibit

Description

Form

Exhibit

Filing Date

3.1

Restated Certificate of Incorporation of the Company.

S-1

3.1

1/29/1997

3.2

Restated Bylaws of the Company.

8-K

3.2

8/2/2007

3.3

Certificate of Amendment to the Certificate of Incorporation of StarTek, Inc. filed with the Delaware Secretary of State on May 21, 1999.

10-K

3.3

3/8/2000

3.4

Certificate of Amendment to the Certificate of Incorporation of StarTek, Inc. filed with the Delaware Secretary of State on May 23, 2000.

10-Q

3.4

8/14/2000

4.1

Specimen Common Stock certificate.

10-Q

4.2

11/6/2007

10.1

†

StarTek, Inc. Employee Stock Purchase Plan.

Def14a

3/20/2008

10.2

†

StarTek, Inc. 2008 Equity Incentive Plan.

Def14a

3/20/2008

10.3

†

Form of Non-Statutory Stock Option Agreement (Employee) pursuant to StarTek, Inc. 2008 Equity Incentive Plan.

8-K

10.2

5/5/2008

10.4

†

Form of Non-Statutory Stock Option Agreement (Director) pursuant to StarTek, Inc. 2008 Equity Incentive Plan.

8-K

10.3

5/5/2008

10.5

†

Form of Incentive Stock Option Agreement (Employee) pursuant to StarTek, Inc. 2008 Equity Incentive Plan.

8-K

10.4

5/5/2008

10.6

†

Form of Restricted Stock Award Agreement (Employee) pursuant to StarTek, Inc. 2008 Equity Incentive Plan.

8-K

10.5

5/5/2008

10.7

†

Form of Restricted Stock Award Agreement (Director) pursuant to StarTek, Inc. 2008 Equity Incentive Plan.

8-K

10.6

5/5/2008

10.8

†

Amendment No. 1 to Form of Executive Employment Contract.

10-K

10.11

2/29/2008

10.9

*†

Amendment to employment agreement of A. Laurence Jones signed May 23, 2008.

10.10

Amendment effective April 1, 2008 to the Master Service Agreement effective March 21, 2002 between StarTek, Inc. and AT&T Mobility LLC for certain call center services.

10-Q

10.5

5/6/2008

10.11

Amendment effective April 1, 2008 to Amendment No. 001 dated April 1, 2004 to the Master Service Agreement incorporating a Statement of Work between StarTek, Inc. and AT&T Mobility, LLC for certain call center services.

10-Q

10.6

5/6/2008

10.12

Amendment effective May 1, 2008 to the Master Service Agreement effective March 21, 2002 between StarTek, Inc. and AT&T Mobility LLC for certain call center services.

10.13

Amendment effective May 1, 2008 to Amendment No. 001 dated April 1, 2004 to the Master Service Agreement incorporating a Statement of Work between StarTek, Inc. and AT&T Mobility, LLC for certain call center services.

10.14

Work Order 20080122.003.C effective May 1, 2008 between StarTek USA, Inc. and AT&T Mobility LLC

10.15

Amendment Cing7866.A.001 effective April 16, 2008 between StarTek USA, Inc. and AT&T Mobility LLC

Incorporated Herein by Reference

Exhibit

Description

Form

Exhibit

Filing Date

10.16

Amendment 20070105.006.S.002.A.001 effective June 27, 2008 by and between StarTek, Inc. and AT&T Services, Inc.

10.17

Amendment 20070105.006.S.007.A.001 effective July 14, 2008 between StarTek, Inc. and AT&T Crop.

10.18

General Agreement Order 20070105.006.S.008 effective June 19, 2008 by and between StarTek, Inc. and AT&T Services, Inc.

10.19

General Agreement Order 20070105.006.S.009 effective June 5, 2008 by and between StarTek, Inc. and AT&T Services, Inc.

10.20

General Agreement Order 20070105.006.S.010 effective June 5, 2008 by and between StarTek, Inc. and AT&T Services, Inc.

10.21

General Agreement Order 20070105.006.S.011 effective June 5, 2008 by and between StarTek, Inc. and AT&T Services, Inc.

10.22

General Agreement Order 20070105.006.S.012 effective July 10, 2008 by and between StarTek, Inc. and AT&T Services, Inc.

10.23

Fourth Amendment to Credit Agreement entered into as of April 30, 2008.

10.24

Fifth Amendment to Credit Agreement, $10,000,000 Revolving Line of Credit Note, and Addendum to Promissory Note, each entered into as of June 30, 2008.

10.25

Continuing Security Agreement between StarTek USA, Inc. and Wells Fargo Bank, National Association, entered into as of June 30, 2008.

10.26

Continuing Security Agreement between StarTek, Inc. and Wells Fargo Bank, National Association, entered into as of June 30, 2008.

31.1

Certification of A. Laurence Jones pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

Certification of David G. Durham 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.


*		Filed with this Form 10-Q.

†		Management contract or compensatory plan or arrangement.

&		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.

EX-10.9 2 c74453exv10w9.htm EXHIBIT 10.9 Filed by Bowne Pure Compliance

Exhibit 10.9

May 23, 2008

Mr. A. Laurence Jones
840 Sixth Street
Boulder, CO 80302

Dear Larry:

StarTek, Inc. (“Company”) proposes to amend, as set forth below, the employment agreement entered into effective January 5, 2007 between you (“Executive”) and the Company, as previously amended, that states the terms and conditions of your employment with Company (“Agreement”). If you agree to the amendments proposed below, please initial the bottom of each page, sign at the end of this letter in the spaces indicated, and return a fully signed copy. Such amendments would be effective on the date that you do so.

1. Revise Section 4(b) to read as follows:

(b) Annual Incentive Bonus. Executive shall be eligible to participate in Company’s annual Incentive Bonus Plan with a bonus potential of 100% of Base Salary at 100% target attainment (the “Bonus Potential”) pursuant to the terms, conditions and limitations set forth therein and subject to achievement of performance criteria and satisfaction of terms established by the Compensation Committee after consultation with Executive. Any annual incentive bonus shall be paid to Executive at the same time as incentive awards for such fiscal year are paid to other executives of the Company, subject to any delay required by Section 409A of the Internal Revenue Code to avoid adverse tax consequences.

2. Revise Section 5(b) to read as follows:

(b) For purposes of this Agreement, “Restrictive Period” shall mean: (A) 24 consecutive months from and after the date of termination of Executive’s employment if Executive’s employment is terminated for a reason other than a reason set forth in Section 10(a) below, and (B) 24 consecutive months from and after the date of termination of Executive’s employment if Executive’s employment is terminated for a reason set forth in Section 10(a) below.

3. Revise Section 4(c) to read as follows:

(c) Stock Options. To the extent that Company has or may grant Executive options to purchase shares of Company common stock (“Options”), the vesting schedule, including without limitation, any acceleration upon change-in-control, and all other terms, conditions and limitations of such Options will be those set forth in the stock option plan pursuant to which such Options were granted, Option grant notices, and Option agreements approved by the Board of Directors and entered into by Executive.

4. Revise Section 10(a) to read as follows:

(a) If Executive’s employment with the Company is terminated by the Company without Cause or Executive resigns for Good Reason, the Company shall, in addition to paying Executive his then current base salary earned through the Termination Date and subject to the conditions set forth in Section 10(g), pay to Executive:

	(i)		the equivalent of twenty-four (24) months of Executive’s annual Base Salary as in effect immediately prior to the Termination Date, payable on the same basis and at the same time as previously paid, commencing on the first regularly scheduled pay date following the effective date of the release mentioned in Section 10(g);

	(ii)		a lump sum amount equal to two times Executive’s Bonus Potential;

	(iii)		annual bonus for the year during which termination occurs, pro-rated for time and performance as judged by the Chairman of the Compensation Committee of the Company’s Board of Directors; and

	(iv)		(A) if Executive elects to continue for himself and his eligible dependents health insurance coverage following the Termination Date, pay the employer’s share of such coverage, at the same level of coverage that was in effect as of the Termination Date, for a period of 24 consecutive months after the Termination Date or until Executive has become eligible for health coverage through another employer, which ever occurs first; or (B) if as of the Termination Date, Executive has, pursuant to the last sentence of Section 4(e) above, waived coverage for himself and his dependents under the Company’s group health plan, pay to Executive the employer’s share of the premiums for the coverage that he waived for 24 consecutive months after the Termination Date or until Executive has become eligible for health coverage through another employer, which ever occurs first.

Executive hereby agrees to promptly notify Company if Executive becomes eligible to be covered by group health insurance.

Except as set forth above, the Agreement continues in full force and effect according to its terms.

If you have any questions, please do not hesitate to call me at your earliest convenience.

Page 2 of 3


StarTek, Inc.

By:		/s/ Albert Yates

		Albert Yates, Chairman
		Compensation Committee
		Board of Directors

I have read this proposal and I understand and I accept its terms.


A. Laurence Jones

A. Laurence Jones

Date: 5/23/08

Page 3 of 3

EX-10.12 3 c74453exv10w12.htm EXHIBIT 10.12 Filed by Bowne Pure Compliance

Exhibit 10.12

Cing2284.A.005

This Amendment (cing2284.A.005), effective as of May 1, 2008 (“Effective Date”), between StarTek USA, Inc. (“StarTek”), a Delaware corporation, and AT&T Mobility LLC, (“AT&T Mobility”) a Delaware limited liability company, on behalf of itself and its Affiliates, amends that certain Provider Master Service Agreement dated January 1, 2002.

RECITALS

WHEREAS, AT&T Wireless Services, Inc. and StarTek entered into a Provider Master Service Agreement on January 1, 2002 (the “MSA”);

WHEREAS AT&T Wireless Services, Inc. assigned its rights and delegated its duties under the MSA and all statements of work thereunder to AT&T Mobility;

WHEREAS AT&T Mobility and StarTek desire to amend the term of the MSA;

NOW THEREFORE, FOR AND IN CONSIDERATION of the mutual covenants contained herein, the parties agree to amend the MSA as follows:

	1.		Section 8. “Term and Extension of Relationship” of the MSA is hereby deleted in its entirety and it is replaced by the following:

			“8. Term and Extension of Relationship

			This MSA is effective as of March 21, 2002 (‘Effective Date’) and ends on May 30, 2008.”

	3.		Except as amended by this Amendment, the MSA and all responsibilities are not otherwise modified, revoked or superseded and remain in full force and effect.

IN WITNESS WHEREOF, the parties execute this Amendment as of the date stated above.


AT&T Mobility LLC by its authorized		StarTek USA, Inc.
Representative AT&T Services, Inc.

By:	/s/ George Atchison	By:	/s/ Patrick Hayes

Printed Name: George Atchison		Printed Name: Patrick Hayes
Title: Senior Contract Manager		Title: EVP & COO
Date: 4/30/2008		Date: 4/30/08

Proprietary Information

The information contained in this Agreement is not for use or disclosure outside AT&T Mobility, StarTek, their affiliated companies and their third party representatives, except under written Agreement by the contracting Parties.

EX-10.13 4 c74453exv10w13.htm EXHIBIT 10.13 Filed by Bowne Pure Compliance

Exhibit 10.13

Cing2587.A.005
Page 1 of 1

This Amendment cing2587.A.005, effective as of May 1, 2008 (“Effective Date”), between StarTek USA, Inc. (“StarTek”), a Delaware corporation, and AT&T Mobility LLC, (“AT&T Mobility”) a Delaware limited liability company, on behalf of itself and its Affiliates, amends the statement of work described below.

RECITALS

WHEREAS, AT&T Wireless and StarTek entered into a Provider Master Service Agreement on January 1, 2002 (the “MSA”);

WHEREAS AT&T Wireless and StarTek executed Amendment No. 001 dated April 1, 2004 to the MSA incorporating a Statement of Work (“SOW”) to provide services to AT&T Wireless;

WHEREAS AT&T Wireless Services, Inc. assigned its rights and delegated its duties under the MSA and all statements of work thereunder to AT&T Mobility;

WHEREAS AT&T Mobility and StarTek desire to amend the term of the of the SOW;

NOW THEREFORE, FOR AND IN CONSIDERATION of the mutual covenants contained herein, the parties agree to amend the SOW as follows:

1. Section IV. “Term” of the SOW is hereby deleted in its entirety and it is replaced by the following:

“IV. ‘Term’ This SOW shall begin on April 1, 2004 (“Effective Date”) and end on May 30, 2008.”

Except as amended by this Amendment, the SOW is not otherwise modified, revoked or superseded and remain in full force and effect.

3. This amendment maintains services pending approval of a new work order.

IN WITNESS WHEREOF, the parties execute this Amendment as of the effective date.


StarTek USA, Inc.		AT&T Mobility LLC by its authorized
		Representative AT&T Services, Inc.

By:	/s/ Patrick M. Hayes	By:	/s/ Richard Steadman
Printed Name: Patrick Hayes		Printed Name: Richard Steadman
Title:	EVP & COO	Title:	AVP — Global Strategic Sourcing
Date:	4/30/08	Date:	30 April 2008

Proprietary Information

EX-10.14 5 c74453exv10w14.htm EXHIBIT 10.14 Filed by Bowne Pure Compliance

Exhibit 10.14

* Material has been omitted pursuant to a request for confidential treatment and such material has been filed separately with the Securities and Exchange Commission. An asterisk within brackets denotes omissions.

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This Work Order 20080122.003.C (“WO”) is issued pursuant to the Master Services Agreement No. GAMSA-STAR081106-00 dated October 1, 2006 (“Agreement”) between AT&T Mobility LLC f/k/a Cingular Wireless LLC (“AT&T Mobility”) and StarTek USA Inc. (“Supplier”) and the Agreement is incorporated by reference herein. Capitalized terms used in this Work Order not otherwise defined herein shall have the definitions specified in the Agreement. If the Work Order conflicts with the terms and conditions of the Agreement, the terms and conditions of the Agreement shall control unless set forth in the “Special Considerations” section of this Work Order in which case the WO shall govern and control.

AT&T Mobility hereby authorizes Supplier to perform the following Services:

SCOPE OF WORK

	1.1		Supplier consumer customer services representatives (“CSRs”) shall take and handle inbound customer care inquiries by program (“Program”) as set forth in Exhibit C in accordance with the AT&T Mobility hours of operation set forth in Section 1.2 subject to applicable laws at the rates set forth in Exhibit B. Any other customer care activities, changes that result in the nature or type, market or mix of calls to change, including any changes to the mix of Program project(s) supported by Site as set forth in Exhibit C attached hereto, shall be subject to Exhibit 5 of the Agreement.

	1.2		Services shall be performed Monday through Sunday, not including Holidays as set forth in Exhibit B, at the hours of operations (“Hours of Operation”) set forth in Exhibit D by site (“Site”):

			Hours of Operation may be amended from time to time as set forth in Exhibit 5 of the Agreement. AT&T Mobility reserves the right to modify (decrease or increase) Services Hours of Operation upon twenty (20) calendar days written notice to Supplier. AT&T Mobility agrees to utilize the Change in Scope procedures to effect this change.

PRIMARY CONTACT INFORMATION

2.1

The individuals listed in the table below will serve as primary contact for the Program. Any changes will be done in accordance with Exhibit 5 of the Agreement.


AT&T Mobility Contacts	Supplier Contact(s)
[*]		[*]

TERM

3.1

The Term of this Work Order shall commence on May 1, 2008 (“Effective Date”), and shall continue until midnight on April 28, 2010 (the “Initial Term). The Work Order may be terminated as allowed in the Agreement or in this Work Order.

SERVICE SPECIFICATIONS AND REQUIREMENTS

4.1

The deliverables to be delivered by Supplier to AT&T Mobility pursuant to this Work Order are listed in Exhibit A “Deliverables Matrix” (the “Deliverables”).

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AT&T MOBILITY SYSTEMS USE AND DOWNTIME

	5.1		Should AT&T Mobility systems become unavailable to Supplier, Supplier will follow the notification instructions contained in AT&T Mobility’s Downtime Policy as provided by AT&T Mobility. Supplier will utilize downtime forms to capture call information on the AT&T Mobility-provided downtime forms and will input into AT&T Mobility systems as soon as reasonably possible after restoration of the impacted systems. AT&T Mobility shall pay the applicable [*] rate for this function. Supplier shall be excused from Performance Standards for the duration of the system outage.

	5.2		If the telecommunications systems are in failure due to AT&T Mobility, AT&T Mobility may require Supplier’s CSRs to go into pure AUX state, whereby they are not receiving calls. AT&T Mobility shall still be charged the actual outage time incurred for the amount of time affected. Supplier shall be excused from Performance Standards for the duration of the outage.

	5.3		The AT&T Mobility system will be completely down during certain after-hour times and other scheduled times throughout the year for maintenance. When practical, AT&T Mobility will advise Supplier of the scheduled maintenance at least twenty-four (24) hours prior to the times and dates that the systems will not be available due to maintenance.

	5.4		Notwithstanding the foregoing, in the event of a Supplier system/telecommunications outage, Supplier will utilize CSRs’ [*] time for offline work and training for the duration of the outage. AT&T Mobility shall not be charged for unutilized hours for the duration of a Supplier system outage.

	5.5		Supplier shall advise the AT&T Mobility Contact and/or Vendor Manager when any AT&T Mobility-provided system is down for more than 5 minutes. Supplier shall provide an escalation plan with mitigating action in the event of systems disruption to be approved by AT&T Mobility by Services launch.

	5.6		Supplier will continue to provide the Services under this Work Order if AT&T Mobility relocates its operations to an interim or substitute facility or otherwise implements any of its internal disaster recovery plans.

	5.7		Failure to comply materially with this Section constitutes a material breach of the Agreement.

PERFORMANCE STANDARDS:

6.1

AT&T Mobility and Supplier have developed the standards set forth in this Work Order, (hereinafter “Performance Standards”) to ensure the delivery of high quality, efficient customer service. Effective upon signature of this Work Order by both parties (“Execution Date”), Performance Standard measurements for Sites existing on the Execution Date shall begin the month following the Execution Date, or for the Performance Standards related to First Call Resolution and Overall Customer Satisfaction, the next full or prorated per complete months remaining, as the case may be, calendar quarter. Performance Standards for Sites opening after the Execution Date shall be applicable to Services performed from a particular Site/Program [*] days after Site opening, or as outlined in the Performance Measurements attached hereto as Exhibit E. Furthermore, anytime a particular Site/Program increases by more than twenty five percent (25%) over a two (2) month period (measured by the 45-Day Lock FTE), Performance Standards shall not apply with respect to such Site/Program until [*] after the incremental Site/Program staff has been in Production handling customer calls. Before the application of any of the Performance Standards, the parties agree to meet and discuss in good faith changes to the Performance Standards set forth and the relevant AT&T Mobility invoice credits and Supplier earned debits or bonuses with respect to such Performance Standards based on performance prior to such Performance Standards taking effect. Performance Standards hereunder shall be measured by Program at each Site and shall exclude calls handled by the IVR and those calls subject to waivers as set forth herein this Work Order. Any invoice credits owed or debits earned by Supplier shall only apply to the Services invoiced for the particular Site/Program subject to Section 1.1 herein for which it was measured and shall be assessed to Customer Service Experience (“CSE”) Program [*] in Production only. Any invoice debits earned by Supplier will be used to offset AT&T Mobility invoice credits only, except for Section 6.3.3 Occupancy which may earn a true debit. Notwithstanding the foregoing, Supplier may earn a Bonus subject to Sections 6.3.1 and 6.3.2. AT&T Mobility invoice credits, Supplier earned debits to AT&T Mobility invoice credits, and bonuses will be calculated as set forth in Section 6.3 and shall be applied on a quarterly basis.

PRIVATE/PROPRIETARY/LOCK

The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their affiliated companies and their third party representatives, except under written Agreement by the contracting Parties.

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6.2

Call Volume Forecasting / Staffing. Each month on a by Site/Program basis, AT&T Mobility shall provide Supplier three (3) written forecasts to be used by Supplier as a guide for recruitment, planning and staffing activities. The three (3) written forecasts are as follows:

1. 90 Day Outlook Forecast with the required number of Full Time Equivalents (“FTEs”) by Site/Program for recruitment purposes

2. 45 Day Locked Forecast with the estimated daily number of calls by Site/Program for planning purposes as well as forecasted modification training for the applicable month (“45 Day Lock”)

3. 15 Day Forecast with daily call arrival patterns by Site/Program

Supplier shall provide FTE staffing pursuant to the mutually agreed upon 45 Day Lock based upon the 90 Day Outlook Forecast, which will include an assumption of the current training and nesting requirements set forth in Exhibit D. Notwithstanding the foregoing, in the event that AT&T Mobility requests training to extend beyond the current requirements set forth in Exhibit D, the parties shall address the change subject to Exhibit 5 of the Agreement.

The mutually agreed upon 45 Day Lock represents a commitment by AT&T Mobility and Supplier with respect to staffing levels. Once the 45 Day Lock is agreed to, AT&T Mobility agrees to compensate Supplier for the [*] incurred for the applicable month, and it is Supplier’ responsibility to staff to the 45 Day Lock as mutually agreed upon. In cases where Supplier has duplicate Programs across Sites, AT&T Mobility and Supplier shall mutually agree upon volume changes at a Site level as long as the 45 Day Lock remains unchanged. In the event that actual volumes are less than the 45 Day Lock, Supplier will use reasonable best efforts to ensure productive utilization of CSRs by offering voluntary go home (“VGH”), internal training, etc.

Each 15 Day Forecast will be prepared on a Site/Program basis in thirty (30) minute intervals and will include estimated call volumes, estimated average handle times, estimated shrinkage percentages and, when available, any other information which would be relevant for Supplier in providing the Services.

Both AT&T Mobility and Supplier will need to agree upon the volume forecasts and related staffing when the 45 Day Lock represents +/- 15% change from the previous 90 Day Outlook Forecast, as it may require additional new hire training. The parties shall mutually agree upon adjusted staffing for the modified forecast volumes pursuant to Exhibit 5 of the Agreement. Notwithstanding the foregoing, in the event a Site requires a reduction of more than forty-nine (49) CSRs , Supplier shall have seventy (75) days from receipt of written notice, or the minimum number of days required to maintain compliance with the laws applicable in the affected Site’s location, to comply with the AT&T Mobility provided forecast.

	a)		The Performance Standards outlined in this Work Order may be changed by AT&T Mobility upon thirty (30) days written notice to Supplier per the procedure outlined in Exhibit 5, Management Procedures for Change in Scope of the Agreement.

	b)		Notwithstanding the foregoing Performance Metrics and/or AT&T Mobility invoice credits under this WO or the Agreement shall be waived to the extent they are attributable to a failure caused by AT&T Mobility or if actual call volume for the Program exceeds or is less than the 45 Day Lock for such Site/Program by more than ten percent (10%) or as otherwise set forth in this Work Order or the Agreement.

	c)		Material failure to meet the same Performance Standards at the same Site/Program for two (2) consecutive months shall be considered a material default.

	d)		Supplier shall provide at least [] of the staffing pursuant to the 45 Day Lock and in any case shall use reasonable efforts to achieve one hundred percent (100%) of the staffing pursuant to the 45 Day Lock, and AT&T Mobility shall provide at least [] of the [] pursuant to the 45 Day Lock. If Supplier fails to staff at least [] of the 45 Day Lock and the shortage materially impacts AT&T Mobility’s ability to provide services to its customers, Supplier’s failure will be considered a material default. At the request of AT&T Mobility, Supplier will provide a corrective action plan for such breach.

	e)		Supplier shall be excused from Performance Metrics and/or AT&T Mobility invoice credits under this SOW in the event the parties determine that the components and/or assumptions used to determine the 45 Day Lock are inaccurate resulting in Supplier failing to meet Performance Metrics. The parties will mutually agree upon which component and/or assumption is inaccurate, will correct and re-run current and future forecasts utilizing the corrected components and/or assumptions. Variable assumptions and/or components include, but shall not be limited to: call volume, AHT assumption, occupancy, and modification/upgrade training hours.

PRIVATE/PROPRIETARY/LOCK

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6.3

Performance Metrics: The following Performance Metrics shall be measured on a Site basis and shall apply to the Customer Service Experience (“CSE”) program only, and shall be subject to material default and the applicable AT&T Mobility invoice credit, Supplier earned debit to AT&T Mobility’s invoice credit, or Bonus set forth herein. Notwithstanding the foregoing, AT&T Mobility may request that additional Programs be subject to the Performance Metrics and subject to Exhibit 5 of the Agreement.

	6.3.1		First Call Resolution Rate (“FCR”): FCR will be measured quarterly by Site by the Telegence and CARE Programs which shall be considered one (1) Program for the purposes of FCR stack ranking and shall be ranked against Like Sites’ national average, contingent upon a sample size of at least four hundred (400) per Site. Sample sizes of less than four hundred (400) shall be excluded from the quarterly measurement. AT&T Mobility or AT&T Mobility vendor sites with samples sites of less than four hundred (400) shall not be included in the stack ranking. FCR shall be waived in the event Supplier’ results are within the top [] of stacked ranking measured by region, regardless if Supplier results fall within the [] quartile when measured against the national average for overall Like Sites.

			Example:


Assumptions:
Overall Like Sites national average results:			[*]
Results for top [*] of Like Sites measured by region:			[*]
Supplier results:			[*]

Supplier results within the top [*] of the results measured by region. FCR Performance Standard and associated AT&T Mobility invoice credit is waived. AT&T Mobility invoice credits and Supplier earned offset debits will be applied at the end of the quarter, by Site/Program pursuant to Exhibit E. New sites will be measured [*] after the first call received in Production. Converted sites (sites subject to Conversion training as described in Exhibit B herein) will be measured [*]months after the first call received in Production. The AT&T Mobility invoice credits and Supplier earned offset debits will be applied in the following fashion based on FCR scores:


[*] of Like sites		[*] AT&T Mobility invoice credit
[*] of Like Sites		[*] AT&T Mobility invoice credit
[*] of Like Sites		[*] Supplier earned offset debit
[*] of Like Sites		[*] Supplier earned offset debit

Not to exceed [*] AT&T Mobility invoice credit

A [*] percent ([*]%) bonus may apply on a per Site basis if the FCR stretch target is achieved in any quarter (“Bonus”). The stretch target for First Call Resolution is [*] or better. The Bonus shall be calculated as follows: 1) The quarterly invoice credit(s) /debit(s) shall be calculated (“Offset Result”), then (2) the Bonus shall be applied to the Offset Result.

PRIVATE/PROPRIETARY/LOCK

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	6.3.2		Overall Customer Satisfaction (“OCS”): will be measured quarterly by Site by the Telegence and CARE Programs which shall be considered one (1) Program for the purposes of OCS stack ranking and ranked against Like Sites’ national average, contingent upon a sample size of at least four hundred (400) per Site. Sample sizes of less than four hundred (400) shall be excluded from the quarterly measurement. OCS shall be waived in the event Supplier’ results are within the top [] of stacked ranking measured by region, regardless if Supplier results fall within the [] quartile when measured against the national average for overall Like Sites.

			Example:


Assumptions:
Overall Like Sites national average results:			[*]
Results for top [*] of Like Sites measured by region:			[*]
Supplier results:			[*]

Supplier results within the top [*] of the results measured by region. OCS Performance Standard and associated AT&T Mobility invoice credit is waived. AT&T Mobility invoice credits and Supplier earned offset debits will be applied at the end of the quarter, by Site/Program pursuant to Exhibit E. New sites will be measured [*]after the first call received in Production. Converted sites (Sites subject to Conversion training as described in Exhibit B herein) will be measured [*]after the first call received in Production. The AT&T Mobility invoice credits and Supplier earned offset debits will be applied in the following fashion based on Overall Customer Satisfaction scores:


[*] of Like Sites		[*] AT&T Mobility invoice credit
[*] of Like Sites		[*] AT&T Mobility invoice credit
[*] of Like Sites		[*] Supplier earned offset debit
[*] of Like Sites		[*] Supplier earned offset debit

Not to exceed [*] AT&T Mobility invoice credit.

A [*] bonus may apply on a per Site basis if the FCR and OCS stretch targets are achieved in any quarter (“Bonus”). The stretch target for Overall Customer Satisfaction is [*] or better. The Bonus shall be calculated as follows: 1) The quarterly invoice credit(s) /debit(s) shall be calculated (“Offset Result”), then (2) the Bonus shall be applied to the Offset Result.

6.3.3

Occupancy Rate Target of [*] The Occupancy Rate will be measured monthly, and shall be calculated by subtracting total idle (waiting to serve) time from total logged in time and dividing the difference by total logged in time. The Occupancy Performance Standard and associated AT&T Mobility invoice credit will be waived in the event that the actual call volume is less than[*] of the 45 Day Lock. Any individual days where the actual call volumes are less than the 45 Day Forecast by [*] or more and the Occupancy target is missed will be excluded from the monthly calculation of Occupancy. The AT&T Mobility invoice credits and Supplier earned debits will be applied in the following fashion based on Occupancy Rate scores:


below [*]		[*] AT&T Mobility invoice credit
[] to []		[*] Supplier earned debit
above [*]		[*] Supplier earned debit

Notwithstanding the foregoing, Supplier may only earn a debit for Occupancy if it is staffed to at least [*] of the full time equivalents (“FTEs”) mutually agreed upon in the 45 Day Lock. An FTE is defined by forty (40) worked hours.

6.3.4

Productivity: The measurement for productivity will be measured monthly and shall be calculated as follows: [*]. The Productivity Performance Standard and associated AT&T Mobility invoice credit will be waived if voluntary go home time associated with low volumes drives lower productivity. Converted sites (sites subject to Conversion training as described in Exhibit B herein) will be measured [*] after the first call received in Production, The AT&T Mobility invoice credits will be applied in the following fashion based on Productivity scores:


below [*]		[*] AT&T Mobility invoice credit

PRIVATE/PROPRIETARY/LOCK

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6.3.5

Call Transfer Rate for CSE Sites/Program only: AT&T Mobility and Supplier shall mutually agree upon a target for the CSE Call Transfer Rate within ninety (90) days of the Execution Date. Until such time, Supplier will use commercially reasonable efforts to meet an operation target of [*] (“Operational Target”). The Operational Target for the Call Transfer Rate shall not in any way be used to determine a material breach on the part of Supplier. Change management procedures set forth in Exhibit 5 of the Agreement will be invoked for process changes directly impacting Call Transfer Rates.


TBD		(Rounded to the nearest whole percentage)

	6.3.6		Average Handle Time (“AHT”): The AHT target by Site/Program shall be provided by AT&T Mobility as part of the 45 Day Lock and shall be measured monthly as it applies to material breach. The AHT Performance Standard will be waived if the actual Call Volume is greater than ten percent (>10%) over the target provided in the 45 Day Lock or if the average of other Like Sites is [] or greater. The AHT target provided in the 45 Day Lock will be subject to material breach, however, will not be subject to credits or debits. Converted sites (sites subject to Conversion training as described in Exhibit B herein) will be measured [] after the first call received in Production,

			With respect to credits and debits, AT&T Mobility may receive the invoice credit set forth herein in the event the monthly AHT measurement is [*] or greater. Change management procedures set forth in Exhibit 5 of the Agreement will be invoked if AHT targets need to change.

			The AT&T Mobility invoice credits will be applied in the following fashion:


above [*] seconds		[*] AT&T Mobility invoice credit

6.3.7

Short Call Rate: Shall mean calls that are less than [*] in length. The goal is not to exceed [*] and shall be measured monthly. Converted sites (Sites subject to Conversion training as described in Exhibit B herein) will be measured [*] after the first call received in Production. Change in procedures shall be subject to Exhibit 5 of the Agreement.

7.		Cap:

		The resulting Supplier earned debits and AT&T Mobility invoice credits for the applicable Performance Standard measurement set forth herein Section 6 will only be applied to the applicable Site’s Program [] billed. The total AT&T Mobility invoice credit for all Performance Standards in aggregate in any month cannot exceed a maximum of [] per Site invoice. The total invoice debits to AT&T Mobility’s invoice credit for all Performance Standards in aggregate in any month cannot exceed a maximum of a [] per Site invoice. Notwithstanding the foregoing, Supplier may earn an additional [] Bonus per quarter upon attainment of FCR and OCS stretch targets.

8.		Performance Metrics Waivers

	8.1		In addition to any other waivers set forth herein this Work Order, Supplier shall be excused for failures to meet any Performance Metric and shall not be in breach of this Work Order if such failure is caused by: a) AT&T Mobility; and/or b) third parties (hired or contracted) to provide system applications and/or system application services to or for AT&T Mobility (including carriers) (a and b collectively referred to as “AT&T Mobility/Service Provider”) including without limitation acts or omissions of AT&T Mobility/Service Provider.

	8.2		Notwithstanding anything to the contrary herein, in addition to waivers set forth herein this Work Order, AT&T Mobility may choose to waive Performance Standards and applicable penalties at its sole discretion. AT&T Mobility must invoke this option in writing within thirty (30) days of a missed Performance Metric.

PRICE

9.1

Services shall be compensated by AT&T Mobility to Supplier pursuant to the rates and charges detailed in Exhibit B which is attached hereto and fully incorporated herein by this reference. Such rates and charges do not include all applicable taxes.

PRIVATE/PROPRIETARY/LOCK

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10.		DISPUTE RESOLUTION

		Either party may give the other party written notice of any dispute not resolved in the normal course of business. The parties will attempt in good faith to promptly resolve any issue, dispute, or controversy arising out of or relating to this Agreement promptly by negotiation between the managers set forth below. Within ten (10) days after delivery of such notice, representatives of both parties will meet at a mutually acceptable time and place, and thereafter as often as they reasonably deem necessary, to exchange relevant information and to attempt to resolve the dispute within the time frames here:


	AT&T Mobility Wireless	Supplier

Within 10 days	[*]	Regional VP

Within 20 days	[*]	Regional VP

Within 30 days	[*]	Senior Vice President or Executive Vice President of Operations

If any dispute is not resolved in accordance with this process after sixty (60) days, the parties will escalate to the respective executive levels. Both parties agree to continue performance during the negotiation period set forth in this section of the Work Order.

The individuals listed in the table above will serve as primary contact for dispute resolution. Any changes will be made in accordance with Exhibit 5 of the Agreement.

11.

SPECIAL CONSIDERATIONS:

11.1

The terms set forth below shall be in addition to the terms set forth in the respective sections of the Agreement:

11.1.1

Supplier Responsibilities

	a.		Except as otherwise set forth in this Work Order or the Agreement, Supplier will be responsible for supplying all Supplier personnel, facilities, technology subject to Section 50 of Agreement, services and materials necessary to perform the Services in accordance with the terms and conditions set forth in this Work Order.

	b.		Supplier will provide the necessary, as of the Effective Date of this Work Order, voice and data infrastructure and PCs (or thin client applications in lieu of PCs) at Supplier’ Site(s) from the point of demarcation within Supplier’ data center(s) for voice and data communications. The point of demarcation is the point where AT&T Mobility-owned circuits/equipment end and Supplier-owned circuits/equipment begin. AT&T Mobility will provide any intelligent call management (ICM) routing and screen-pop equipment as required; or, alternatively Supplier will provide ICM and screen-pop equipment subject to Exhibit 5 of the Agreement. Supplier’ PCs will reside on the Supplier network and access AT&T Mobility’s systems via web, Citrix, or other thin client connectivity.

	c.		Supplier shall pay for the Supplier standard, as of the Effective Date of this Work Order, voice and data network facilities. AT&T Mobility shall be responsible for other voice and data charges, including delivering voice and data to Supplier’ data center hub(s), bandwidth exceeding Supplier’ standards in existence as of the Work Order Effective Date, and any dedicated security equipment required by AT&T Mobility. In the event AT&T Mobility utilizes VoATM to deliver calls to a Supplier hub, AT&T Mobility will provide the Nortel Passport or equivalent device required in the Supplier hub to accept the VoATM traffic. Supplier agrees to relinquish ownership at no cost to AT&T Mobility of any and all toll-free numbers associated with the Program to AT&T Mobility or another party specified by AT&T Mobility within forty-eight (48) hours of AT&T Mobility’s request; provided that AT&T Mobility is current on all invoices.

PRIVATE/PROPRIETARY/LOCK

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11.1.2

Training

	a.		Training costs shall be billed as listed under Exhibit B.

	b.		Initial new hire training: Supplier agrees to provide initial Program training to Supplier’ CSRs in accordance with AT&T Mobility provided Training Materials, and all retraining, ongoing soft-skills training, and customer service training at the rates set forth in Exhibit B, in order to perform the Services described in this Work Order. If mutually agreed between the parties subject to Exhibit 5 of the Agreement, AT&T Mobility may provide AT&T Mobility trainers for initial train-the-trainer training programs.

	c.		AT&T Mobility may request to extend the duration of initial Program training subject to Exhibit 5 of the Agreement.

	11.1.3.		Quality Assessment

			Supplier will provide enough Quality Assessment (“QA”) agents at the QA rate set forth in Exhibit B, to CSRs to meet the average number of observations monthly. Each CSR is monitored an average of [] scored evaluations per month by QA and Production staff/personnel collectively and other informal evaluations as agreed upon by the parties based upon individual CSR performance. Supervisors will use commercially reasonable efforts to provide feedback within [] if below goal and [] if within or above goal. Agents needing improvement will receive additional evaluations via various methods (side by side, additional monitoring, remote monitoring, double jacking, etc). QA agents will shadow CSRs while on the call without the CSR being aware they are being monitored. Calibration sessions between Supplier QA agents, Supplier supervisors and AT&T Mobility representatives will be held weekly to ensure scoring and feedback to CSRs is consistent. If Supplier fails to monitor an average of [] scored evaluations per month by QA and Production staff/personnel collectively as set forth above, Supplier will be advised of such deficiencies and Supplier will have [] days to bring performance back to objective’s standards. AT&T Mobility and Supplier may mutually agree to modify the standards upon written agreement signed by both parties, in the event AHT increases by [] from the previous month’s 45-Day Commitment, AT&T Mobility and Supplier shall re-evaluate the QA staffing required to meet the obligations set forth herein

	11.1.4		AT&T Mobility shall be responsible for and must approve scripts, order forms, and report formats to be used by Supplier for Services provided pursuant to this Work Order. If Supplier desires any changes whatsoever to the aforementioned scripts, forms or formats, then Supplier must obtain AT&T Mobility’s prior written approval of such changes.

	11.1.5		Cancellation and Termination

	a.		Upon expiration, a AT&T Mobility Termination Without Cause or Supplier Cancellation For Cause (if requested by Supplier), of a Work Order, AT&T Mobility and Supplier agree to honor the Full Call Volume Commitments during the notice period with a 3 month ramp down period to follow, where AT&T Mobility will provide to Supplier 75% / 50% / 25% of the Call Volume Commitment, respectively during the 3 month ramp down. Call Volume Commitment is defined as the average monthly volume over the preceding six (6) months prior to termination notification (but in no case less than any applicable minimum). Any difference between actual billings and the Call Volume Commitment shall be billed to and payable by AT&T Mobility.

	b.		In addition to all other rights or remedies provided for in this Agreement or by law, either party may immediately cancel this Agreement if: (1) the other party becomes insolvent or makes a general assignment for the benefit of creditors; (2) the other party admits in writing the inability to pay debts as they mature; (3) Any court appoints a trustee or receiver with respect to the other party or any substantial part of the other party’s assets; or (4) An action is taken by or against other party under any bankruptcy or insolvency laws or laws relating to the relief of debtors, including the Federal Bankruptcy Act.

PRIVATE/PROPRIETARY/LOCK

20080122.003.C
GAMSA-STAR081106-00
Page 9 of 9

	11.2		“Occupancy” is calculated by subtracting total idle (waiting to serve) time from total logged in time and dividing the difference by total logged in time.

	11.3		“Payroll Hour” is defined as an hour for which a CSR is compensated by Supplier

	11.4		“Privacy Laws” means Laws relating to data privacy, trans-border data flow or data protection.

	11.5		[*]

	11.6		“Overall Customer Satisfaction (OCS)” means OCS as measured by the WAVE surveys for Postpaid CSE customers.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized representatives:


StarTek USA Inc.		AT&T Mobility LLC by its authorized
		Representative AT&T Services, Inc.

By:	/s/ A.L. Jones	By:	/s/ Tim Harden
Printed Name: A.L. Jones		Printed Name: Tim Harden
Title:	President & CEO	Title:	President – Supply Chain & Fleet Operations
Date:	7 May 2008	Date:	5-6-08

PRIVATE/PROPRIETARY/LOCK

EX-10.15 6 c74453exv10w15.htm EXHIBIT 10.15 Filed by Bowne Pure Compliance

Exhibit 10.15

Amendment No: CING7866.A.001 TO SOW No: GASOW-STAR100606-00
MSA No: GAMSA-STAR081106-00


*		Material has been omitted pursuant to a request for confidential treatment and such material has been filed separately with the Securities and Exchange Commission. An asterisk within brackets denotes omissions.

AMENDMENT NO.
CING7866.A.001
TO GASOW-STAR100606-00

This Amendment, effective on the date when signed by the last Party (“Effective Date”), and amending Statement of Work GASOW-STAR100606-00 to that certain Master Services Agreement GAMSA-STAR081106-00 is by and between StarTek USA Inc. (“StarTek”) and AT&T Mobility LLC (“AT&T” f/k/a Cingular Wireless LLC a Delaware Limited Liability Company), each of which may be referred to in the singular as “Party” or in the plural as “Parties.”

WITNESSETH

WHEREAS, StarTek and AT&T entered into Statement of Work GASOW-STAR100606-00 to that certain Master Services Agreement GAMSA-STAR081106-00; and

WHEREAS, StarTek and AT&T desire to amend the Statement of Work as hereinafter set forth.

Now, THEREFORE, in consideration of the premises and the covenants hereinafter contained, the Parties hereto agree as follows:

The terms and conditions of Statement of Work GASOW-STAR100606-00 in all other respects remain unmodified and in full force and effect.

1. Section 1 (“SCOPE OF WORK”), of the Statement of Work is amended to include the following new subsection:

1.2.

III.

Tier 2 Voice Data Troubleshooting

Handle customer questions, complaints, and billing inquiries with the highest degree of courtesy and professionalism to resolve customer issues with one call resolution.

Offer alternative solutions where appropriate with the objective of retaining customer’s business.

Handle business transactions in connection with activation of new customer accounts on a computer terminal.

Communicate with customers using web-based tools and demonstrates the associated proficiency in typing and grammar.

Make financial decisions to protect/collect revenues and adjusts customer accounts.

Amendment No: CING7866.A.001 TO SOW No: GASOW-STAR100606-00
MSA No: GAMSA-STAR081106-00

Respond to internal calls from all levels of the Business Customer Services organization.

Provide detailed troubleshooting and education to representatives in the areas of systems, equipment, and network issues.

Support call types including but not limited to GSM, GPRS – including MMS, SMS, WAP protocols, TDMA, AT&T billing systems, PTT, Answer Tones, and UMTS network technologies.

Submit /clarify cases to higher tier network teams when necessary.

Open, maintain, escalate and close clarify cases as necessary.

Communicate with external customers when troubleshooting and resolving customer issues.

Track and report technical problems and trends.

Notification of issues and outages to customer facing groups through Dashboard, END, CSP, and Primus.

Accept transfers from the rest of AT&T Care related to complex Wireless Data service issues.

Aid customers in the troubleshooting and configuration of AT&T software such as PC cards, RIM Blackberry, Personal Digital Assistants and laptop computers.

Assess and complete troubleshooting on the AT&T wireless data network (GPRS / EDGE).

Provide best-in-class customer service and advanced product support to AT&T Mobility Laptop Connect customers.

Laptop Connect subscriber call types supported on this ANS incoming call queue include but are not limited to tethering via Communication Manager, Dell, SONY and other manufacturer embedded modem laptops, Apple compatible modem and air card equipment, Sierra Wireless Watcher, Dial Up Networks, all PC card products and related error messages.

Accept transfers from internal AT&T Mobility departments related to complex wireless data service issues.

Product support includes but is not limited to AT&T Mobility provided equipment, standard hardware operating systems, AT&T Mobility provided applications, the AT&T Mobility data network (GPRS/EDGE/UMTS), application gateways and customer application servers.

Troubleshoot and escalate undocumented wireless data issues for research and resolution.

Proprietary and Confidential
This Agreement and information contained therein is not for use or disclosure outside of AT&T, its Affiliates,
and third party representatives, and StarTek except under written agreement by the contracting Parties.

Amendment No: CING7866.A.001 TO SOW No: GASOW-STAR100606-00
MSA No: GAMSA-STAR081106-00

Exhibit B (“PRICE”), of the Statement of Work is amended to include the following new pricing for the Tier 2 Voice Data Troubleshooting scope of work described above.

Tier 2 Technical Support

$ [*]

IN WITNESS WHEREOF, the Parties have caused this Amendment to Statement of Work GASOW-STAR100606-00 to be executed, which may be in duplicate counterparts, each of which will be deemed to be an original instrument, as of the date the last Party signs.


StarTek USA Inc.		AT&T Mobility LLC

By:	/s/ Patrick M. Hayes	By:	/s/ Karen Tays

Printed Name: Patrick M. Hayes		Printed Name: Karen Tays
Title: CEO		Title: Senior Contract Manager
Date: 16 April 08		Date: 4/3/08

EX-10.16 7 c74453exv10w16.htm EXHIBIT 10.16 Filed by Bowne Pure Compliance

Exhibit 10.16

Amendment

20070105.006.S.002.A.001

Between

StarTek, Inc.

And

AT&T Services, Inc.

Order No. 20071015.006.S.002
Amendment No. 20070105.006.S.002.A.001

AMENDMENT NO. 1

AGREEMENT NO. 20070105.006.S.002

This Amendment, effective on the date when signed by the last Party, and amending Agreement No. 20070105.006.S.002 is by and between StarTek, Inc., a Delaware corporation (“Supplier”), and AT&T Services, Inc., a Delaware corporation (“AT&T”), each of which may be referred to in the singular as “Party” or in the plural as “Parties.”

WITNESSETH

WHEREAS, Supplier and AT&T entered into Agreement No. 20070105.006.S.002, (the “Agreement”) on April 1, 2007 (the “Effective Date”); and

WHEREAS, the Agreement expired by its terms on March 31, 2008 (“Expiration Date”);

WHEREAS, after such Expiration Date, the Parties continued to perform under the Agreement as if it had not expired, and with the intention of extending its term;

WHEREAS, Supplier and AT&T now desire to revive the Agreement and to extend its term and to formalize the validity and continuation of the Agreement since its Effective Date; and

WHEREAS, Supplier and AT&T also desire to amend the Agreement as hereinafter set forth.

Now, THEREFORE, in consideration of the premises and the covenants hereinafter contained, the Parties hereto agree as follows:

1.)

The Parties agree to revive the Agreement and to extend its term as set forth below and agree that it shall be deemed to have been in effect continuously since its Effective Date of April 1, 2007. The Parties further agree to ratify all past actions taken between the above-referenced Expiration Date and the date when this Amendment is effective.

2.)

Section III — (A) Term is hereby amended to delete the parenthetical (A); change the end date to March 31, 2009; and to add the following sentence:

“AT&T shall have the right to extend the duration period specified in this Order for up to twelve (12) months by giving Supplier 45 days prior written notice, at prices no greater than those set forth in this Order.”

Proprietary and Confidential
This Agreement and information contained therein is not for use or disclosure outside of AT&T, its Affiliates,
and third party representatives, and Supplier except under written agreement by the contracting Parties.

Order No. 20071015.006.S.002
Amendment No. 20070105.006.S.002.A.001

3.)

Section IV is hereby amended to change the contact information for AT&T’s program Invoice Manager to:

[*]

4.)

Section V is hereby amended to replace AT&T’s Program Representative with the following:

[*]

5.)

Section VIII is hereby amended to change the maximum expenditure in the first sentence to [*].

6.)

Section IX PRICING SCHEDULE is here amended to replace the Pricing table with the following:

Description

1 - 40 FTEs

41 - 75 FTEs

76 - 125 FTEs

125+ FTEs

Pricing effective as of 4/1/08

[*] Rate

Service Managers

[*]

*Training [*]

[*]

Holidays

[*]

7.)

Section X is hereby added and made part of this Order.


		“X.		Name of Affiliate Ordering Services:
				AT&T Operations, Inc”

8.)

Attachment A — Statement of Work, Section A. Program Description is herby amended to change “Customer Services Managers (“CSM”)” to “Service Managers”. All references to CSM in this Order shall now mean Service Managers.

9.)

Attachment A — Statement of Work, Section D Staffing is hereby amended deleted and replaced with the following:

“Supplier shall provide [*] Service Manager dedicated resources to perform the work pursuant to the “Role Description” and “Knowledge and Skill Requirements” set forth in Section A as they pertain to the AT&T’s TIER III Service Management Function. AT&T reserves the right at anytime, in its sole discretion, to increase or decrease the number of Service Managers by providing written notice to Supplier, for any reason whatsoever, including without limitation the following conditions: performance issues and/or changes in volume growth.”

Proprietary and Confidential
This Agreement and information contained therein is not for use or disclosure outside of AT&T, its Affiliates,
and third party representatives, and Supplier except under written agreement by the contracting Parties.

Order No. 20071015.006.S.002
Amendment No. 20070105.006.S.002.A.001

The terms and conditions of Agreement No. 20070105.006.S.002 in all other respects remain unmodified and in full force and effect.

IN WITNESS WHEREOF, the Parties have caused this Amendment to Agreement No. 20070105.006.S.002 to be executed, which may be in duplicate counterparts, each of which will be deemed to be an original instrument, as of the date the last Party signs.


StarTek, Inc.		AT&T Services, Inc.

By: /s/ A.L. Jones		By: /s/ Keith Connolly

Printed Name: A.L. Jones		Printed Name: Keith Connolly
Title: CEO		Title: Vice President, Global Strategic Sourcing
Date: 6/27/08		Date: May 30, 2008

		On behalf of AT&T Operations, Inc.

Proprietary and Confidential
This Agreement and information contained therein is not for use or disclosure outside of AT&T, its Affiliates,
and third party representatives, and Supplier except under written agreement by the contracting Parties.

EX-10.17 8 c74453exv10w17.htm EXHIBIT 10.17 Filed by Bowne Pure Compliance

Exhibit 10.17


*		Material has been omitted pursuant to a request for confidential treatment and such material has been filed separately with the Securities and Exchange Commission. An asterisk within brackets denotes omissions.

Amendment

20070105.006.S.007.A.001

Between

Startek, Inc.

And

AT&T Services, Inc.

20070105.006.S.007.A.001

AMENDMENT NO. 1

AGREEMENT NO. 20070105.006.S.007

This Amendment, effective on the date when signed by the last Party (“Effective Date”), and amending Agreement No. 20070105.006.S.007 is by and between Startek, Inc., a Delaware corporation (“Supplier”), and AT&T Services, Inc., a Delaware corporation (“AT&T”), each of which may be referred to in the singular as “Party” or in the plural as “Parties.”

WITNESSETH

WHEREAS, Supplier and AT&T entered into Agreement No. 20070105.006.S.007, on July 1, 2007 (the “Agreement”); and

WHEREAS, Supplier and AT&T desire to amend the Agreement as hereinafter set forth.

Now, THEREFORE, in consideration of the premises and the covenants hereinafter contained, the Parties hereto agree as follows:

1.)

Section 2. Duration of Order is hereby amended to change the end date to June 30, 2009 and to add the following paragraph.

2.)

Section 6. Invoices/Billing Information is hereby amended to have all supporting documentation sent to:

[*]

3.)

Section 7. Project Manager/Point of Contact is hereby amended to change to:

[*]

Proprietary and Confidential
This Agreement and information contained therein is not for use or disclosure outside of AT&T, its Affiliates,
and third party representatives, and Supplier except under written agreement by the contracting Parties.

20070105.006.S.007.A.001

4.)

Section 10. Supplier Representative is hereby amended to change the address to:

StarTek, Inc.
44 Cook Street
Denver, CO 80206

5.)

Section 11. Maximum Expenditure is hereby amended to change the value to [*].

The terms and conditions of Agreement No. 20070105.006.S.007 in all other respects remain unmodified and in full force and effect.

IN WITNESS WHEREOF, the Parties have caused this Amendment to Agreement No. 20070105.006.S.007 to be executed, which may be in duplicate counterparts, each of which will be deemed to be an original instrument, as of the date the last Party signs.


Startek, Inc.		AT&T Services

By: /s/ A. Laurence Jones		By: /s/ Richard Steadman

Printed Name: A. Laurence Jones		Printed Name: Richard Steadman
Title: CEO & President		Title: Director, Global Strategic Sourcing
Date: 14 July 2008		Date: 10 July 2008

		On behalf of AT&T Corp.

Proprietary and Confidential
This Agreement and information contained therein is not for use or disclosure outside of AT&T, its Affiliates,
and third party representatives, and Supplier except under written agreement by the contracting Parties.

EX-10.18 9 c74453exv10w18.htm EXHIBIT 10.18 Filed by Bowne Pure Compliance

Exhibit 10.18


*		Material has been omitted pursuant to a request for confidential treatment and such material has been filed separately with the Securities and Exchange Commission. An asterisk within brackets denotes omissions.

Nodal Order Provisioning

20070105.006.S.008

Between

Startek, Inc.

And

AT&T Services, Inc.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier,
their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.008
Page 1 of 7

General Agreement Order No. 20070105.006.S.008

This Order, effective on the date when signed by the last Party (“Effective Date”) is by and between Startek, Inc., a Delaware corporation (“Supplier”) and AT&T Services, Inc., a Delaware corporation (“AT&T”), each of which may be referred to in the singular as “Party” or in the plural as “Parties,” and shall be governed pursuant to the terms and conditions of Agreement Number 20070105.006.C. Any terms and conditions in this Order that modify or change the terms and conditions of Agreement Number 20070105.006.C shall apply to this Order only.

1.		Description of Material and/or Services:

		Supplier shall provide Voice Ordering services and Voice Ordering Support Services to AT&T as determined by AT&T (“Program”), pursuant to Attachment A entitled “STATEMENT OF WORK”, dated April 1, 2008 (“Work”) attached hereto and hereby made a part of this Order.

2.		Duration of Order:

		This Order will continue in effect for a term expiring on March 31, 2010, unless it is Cancelled or Terminated before that date. The Parties may extend the term of this Order beyond that date by mutual written agreement. The terms and conditions of this Order cover all Services started prior to the execution of this Order, from April 1, 2008 up until execution of this Order.

3.		Location:

		Supplier shall perform the Work at the following locations: Greeley CO and Grand Junction, CO

4.		Pricing:

		The following Pricing schedule shows the amounts to be paid to Supplier for the various Work to be performed under this Order.

		Full Time Equivalent (“FTE”) Order Specialists (“OS”) Monthly, the AT&T and Supplier will mutually determine and agree in writing to the FTE headcount quantity of Order Specialists based on [] pursuant to “Section C — Volume and Forecasting Process of Attachment A” to be invoiced according to the rates below. Invoices shall be submitted monthly based on [] and shall exclude any non-production activity, including but not limited to the following: lunchtime, break time, holidays, vacations and sick-time.

			Billable [*] Rates:

			The following rates shall apply to billable Order Specialist FTEs: Rates are based on [*]

Agreement No. 20070105.006.C
Order No. 20070105.006.S.008
Page 2 of 7

Description

1 - 100 FTEs

101 - 150 FTEs

150 + FTEs

Order Specialist FTE [*] Rate*

[*]

[*] Training — pursuant to Section D Training

[*]


*		Any FTEs supporting similar type programs, whether added specifically to this Order or issued under a separate Order will be added to this Orders existing FTE headcount and the cumulative volume of FTEs will be used to determine applicable volume tiered pricing for this Order. For Example: AT&T enters into a separate Order with Startek to provide 40 FTEs to support another similar type Voice program. The existing 136 FTEs under this Order will then be compensated at the next volume tiered price of $[*] since the total combined FTE head count, i.e.176, is at the next volume tier rate threshold.

		Supplier agrees that the rates provided above are all inclusive of the costs for the Program, which include, but are not limited to the following items, and no other charges shall be billed to AT&T.

1.		Training [*]

2.		Dedicated Area Managers

3.		Dedicated AT&T GBS Reports Analyst

4.		Dedicated AT&T GBS Process Managers

5.		Dedicated AT&T GBS Escalation Managers

6.		Travel and Living

7.		Pagers

8.		Programming (e.g. scripting, legacy programming and all programming production support and maintenance functions)

9.		Program / Account management functions and personnel

10.		Development and issuance of reports

11.		Recruiting of Order Specialist

12.		Processing Downtime Forms

13.		System Access and Requirements

14.		Systems — Managing and maintaining equipment and access

15.		Postage

[*]

17.		Copies

Agreement No. 20070105.006.C
Order No. 20070105.006.S.008
Page 3 of 7

Holiday [*]

AT&T agrees to compensate Supplier [*] for work performed by Order Specialist headcount during the Holidays shown in Section I Holidays that were previously approved by AT&T in writing.

		Where the parties are to mutually agree on the headcount quantity, [*] or the course of conduct or activity under this Order, or any other provisions of this Order where the parties may need to mutually agree, in the event the parties cannot mutually agree within ten (10) business days, Supplier agrees to carry out the expressed requests of AT&T provided such requests are not unreasonable. In addition, the parties agree to also promptly escalate to the next level of management for resolution.

5.		Invoices/Billing Information:

		If Supplier is enabled to transact business with AT&T using the internet-based Ariba Supplier Network (“ASN”), Supplier agrees to submit invoices in electronic form to AT&T’s Accounts Payable organization through the ASN. If Supplier is not so enabled, it agrees to submit invoices to AT&T Accounts Payable, PO Box 66960, St. Louis, MO 63166-6960. Invoices against this Order shall reflect billing number [TBD] exactly as shown for Voice Ordering Services; and Invoices for Corporate ITS shall be submitted directly to AT&T’s Corporate ITS Program Representative shown herein. Supplier shall ensure that AT&T’s Program Representatives actually receives such invoices no later than the tenth (10^th) of each month for the prior month’s service in the format requested by AT&T. In addition, Supplier shall provide AT&T, by no later than the 25th of each month, with an estimate of current month’s billing including the amount being accrued and details as to how the amount is being calculated. Such estimate for Voice Ordering Services shall be provided via email to AT&T’s delegate [] Invoices and estimates for Corporate ITS shall be provided via email to [].

		Invoice charges (including any training expenses) shall be in accordance with the rates shown in Section 4 Pricing of this Order.

		[*] Supplier shall provide a document with each invoice which details the following:

•

Headcount [*] by name, hire date, and months on Program as defined in the Statement of Work.

Training — Supplier shall provide the following back-up documentation, as requested by AT&T, supporting all training expenses previously approved by AT&T in writing and billed to AT&T. This documentation shall specify the following information for each training class included in the billed training expense:

	•		Name or other designation of the training class

	•		Program Request Form (PRF) to which the training is billed. If training is cross-promotional (directed by AT&T in writing, and for the benefit of multiple AT&T programs), Supplier will provide a copy of the PRF from AT&T directing the allocation of the resulting expense across the affected programs, as well as a list of the programs across which the expense is to be allocated. The cross-promotional training expense will be allocated, as directed by AT&T, by Supplier across the affected programs (PRF’s)

Agreement No. 20070105.006.C
Order No. 20070105.006.S.008
Page 4 of 7

•

Name of the contact at AT&T who directed Supplier to conduct the training

•

Length, in hours per agent, of the training material covered in the class

•

Start-date of the training class

•

End-date of the training class

•

Number of agents beginning the class

•

Number of agents completing the class

•

Other supporting information as requested by AT&T

		The aforementioned information shall be presented in a consistent format satisfactory to AT&T for each invoice on which travel is billed. Supplier will attach this information, along with other required back-up data, to the back of a copy of the corresponding invoice.

6.		Maximum Expenditure:

		The maximum expenditure under this Order shall not exceed the following amounts over the life of this Order:

	•		[*] for the Voice Ordering services and Voice Ordering Support Services; and

	•		[*] for the Corporate ITS Voice Ordering services and Voice Ordering Support Services.

		Subject to this maximum, the total amount payable by AT&T for the Work shall be determined by applying the stated rate of applicable compensation set forth in this Order. AT&T shall not be required to pay for Work in excess of this maximum unless Supplier has first secured an amendment to this Order authorizing the increased expenditure.

7.		Program Managers/Points of Contact:

		AT&T’s Program Representative for Voice Ordering Services is:

[*]

AT&T’s Program Representative for Corporate ITS Voice Ordering Services is:

[*]

AT&T Contract Manager:

[*]

Supplier Point of Contact:

[*]

Agreement No. 20070105.006.C
Order No. 20070105.006.S.008
Page 5 of 7

10.

Orderly Transition:

For the purposes of this Order, “Section 3.27 Orderly Transition” of Agreement No. 20070105.006.C is hereby deleted in its entirety and replaced with the following:

		ORDERLY TRANSITION

		In the event of expiration, Cancellation or Termination of this Order, wherein all or some portion of the Work will be either discontinued, performed by AT&T itself, or performed elsewhere for AT&T, Supplier agrees to provide to the extent requested by AT&T in writing, for a period not to exceed eighteen (18) months, its full cooperation in the orderly transition of the Work to AT&T or elsewhere, or its discontinuance. Such orderly transition may include but not necessarily be limited to: (1) transitioning customer accounts including reducing headcount to such number as AT&T may request from time to time, during such any such transition period, (2) packing and preparing for shipment any materials or other inventory to be transferred, (3) provision of reports, training manuals, files, and similar media necessary for continuation of the Work transferred, and (4) continuation of Work at reducing levels if necessary during the transition period and at reduced levels if Work is transferred in part. AT&T will only pay compensation for OS activities which have been specifically authorized and directed by AT&T in writing pursuant to this clause, and such payment, if any, will be at the rates set forth in Section 4 Pricing. AT&T will provide thirty (30) days advance written notice to Supplier of customer accounts to be transitioned or terminated. In no event shall Supplier discontinue performing services for customer accounts or reduce, increase or vary, the associated headcount without AT&T’s expressed written consent.

11.		Dispute Resolution — Mediation

The Parties will attempt in good faith to promptly resolve any controversy or claim arising out of or relating to this Order through negotiations between authorized representatives of the Parties, before resorting to other remedies available to them.

If a controversy or claim should arise which is not settled as specified in Subsection a., representatives of each Party who are authorized to resolve the controversy or claim will meet at a location designated by AT&T, at least once, and will attempt to, and are empowered to resolve the matter. Either representative may request this meeting within fourteen (14) days of such request (the “first meeting”).

Unless the Parties otherwise agree, if the matter has not been resolved within twenty-one (21) days of the first meeting, the representatives shall refer the matter to more senior representatives, who shall have full authority to settle the dispute. Such senior representatives will meet for negotiations within fourteen (14) days of the end of the twenty-one (21) day period referred to above, at a site designated by AT&T. Three (3) business days prior to this scheduled meeting, the Parties shall exchange memoranda stating the issue(s) in dispute and their positions, summarizing the negotiations which have taken place, and attaching relevant documents.

If more than one (1) meeting is held between the senior representatives, the meeting shall be held in rotation at the offices of Supplier and AT&T.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.008
Page 6 of 7

If the matter has not been resolved within thirty (30) days of the first meeting of the senior representatives (which period may be extended by mutual agreement), the Parties will attempt in good faith to resolve the controversy or claim in accordance with the American Arbitration Association’s then current Commercial Mediation Rules.

12.

Name of Affiliate Ordering Services:

AT&T Operations, Inc.

IN WITNESS WHEREOF, the Parties have caused this Order to be executed, which may be in duplicate counterparts, each of which will be deemed to be an original instrument, as of the date the last Party signs.


STARTEK, INC.		AT&T Services, Inc.

By:	/s/ Patrick M. Hayes	By:	/s/ Keith Connolly

Printed Name: Patrick M. Hayes		Printed Name: Keith Connolly
Title: COO		Title: Vice President, Global Strategic Sourcing
Date: 19 June 08		Date: 6/11/08

		On behalf of AT&T Operations, Inc.

EX-10.19 10 c74453exv10w19.htm EXHIBIT 10.19 Filed by Bowne Pure Compliance

Exhibit 10.19

Material has been omitted pursuant to a request for confidential treatment and such material has been filed separately with the Securities and Exchange Commission. An asterisk within brackets denotes omissions.

Low Speed Data (Frame Relay & Private Line) Ordering

20070105.006.S.009

Between

Startek, Inc.

And

AT&T Services, Inc.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

Order No. 20070105.006.C
Order No. 20070105.006.S.009
Page 1 of 7

General Agreement Order No. 20070105.006.S.009

Description of Material and/or Services:

Supplier shall provide Data Ordering services and Data Ordering Support Services to AT&T as determined by AT&T (“Program”), pursuant to Attachment A entitled “STATEMENT OF WORK”, dated April 1, 2008 (“Work”) attached hereto and hereby made a part of this Order.

Duration of Order:

This Order will continue in effect for a term expiring on March 31, 2010, unless it is Cancelled or Terminated before that date. The Parties may extend the term of this Order beyond that date by mutual written agreement. The terms and conditions of this Order cover all Services started prior to the execution of this Order, from April 1, 2008 up until execution of this Order.

Location:

Supplier shall perform the Work at the following locations: Greeley CO and Grand Junction, CO.

Pricing:

The following Pricing schedule shows the amounts to be paid to Supplier for the various Work to be performed under this Order.

Full Time Equivalent (“FTE”) Order Specialists (“OS”) Monthly, the AT&T and Supplier will mutually determine and agree in writing to the FTE headcount quantity of Order Specialists based on [*] pursuant to “Section C — Volume and Forecasting Process of Attachment A” to be invoiced according to the rates below. Invoices shall be submitted monthly based on [*] and shall exclude any non-production activity, including but not limited to the following: lunchtime, break time, holidays, vacations and sick-time.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

Order No. 20070105.006.C
Order No. 20070105.006.S.009
Page 2 of 7

Billable [*] Rates:

The following rates shall apply to billable Order Specialist FTEs:

The following rates are based on [*]

Description

1 - 75 FTEs

76 - 125 FTEs

125 + FTEs

Order Specialist FTE [*] Rate*

[*]

[*] Training — pursuant to Section D Training

[*]

LSSD Billing Validation Team*

[*]


*		Any FTEs supporting similar type programs, whether added specifically to this Order or issued under a separate Order will be added to this Orders existing FTE headcount and the cumulative volume of FTEs will be used to determine applicable volume tiered pricing for this Order. For Example: AT&T enters into a separate Order with Startek to provide 40 FTEs to support another similar type Data program. The existing 107 FTEs under this Order will then be compensated at the next volume tiered price of $[*] since the total combined FTE head count, i.e.147, is at the next volume tier rate threshold.

*		Supplier agrees that the rates provided above are all inclusive of the costs for the Program, which include, but are not limited to the following items, and no other charges shall be billed to AT&T.

1.		Training [*]

2.		Dedicated Area Managers

3.		Dedicated AT&T GBS Reports Analyst

4.		Dedicated AT&T GBS Process Managers

5.		Dedicated AT&T GBS Escalation Managers

6.		Travel and Living

7.		Pagers

8.		Programming (e.g. scripting, legacy programming and all programming production support and maintenance functions)

9.		Program / Account management functions and personnel

10.		Development and issuance of reports

11.		Recruiting of Order Specialist

12.		Processing Downtime Forms

13.		System Access and Requirements

14.		Systems — Managing and maintaining equipment and access

15.		Postage

[*]

17.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

Order No. 20070105.006.C
Order No. 20070105.006.S.009
Page 3 of 7

Holiday [*]:

AT&T agrees to compensate Supplier [*] for work performed by Order Specialist headcount during the Holidays shown in Section I Holidays that were previously approved by AT&T in writing.

Where the parties are to mutually agree on the headcount quantity, [*] or the course of conduct or activity under this Order, or any other provisions of this Order where the parties may need to mutually agree, in the event the parties cannot mutually agree within ten (10) business days, Supplier agrees to carry out the expressed requests of AT&T provided such requests are not unreasonable. In addition, the parties agree to also promptly escalate to the next level of management for resolution.

Invoices/Billing Information:

If Supplier is enabled to transact business with AT&T using the internet-based Ariba Supplier Network (“ASN”), Supplier agrees to submit invoices in electronic form to AT&T’s Accounts Payable organization through the ASN. If Supplier is not so enabled, it agrees to submit invoices to AT&T Accounts Payable, PO Box 66960, St. Louis, MO 63166-6960. Invoices against this Order shall reflect billing number [TBD] exactly as shown, and shall be submitted to AT&T’s Program Representative shown herein. Supplier shall ensure that AT&T’s Technical Representative actually receives such invoices no later than the tenth (10^th) of each month for the prior month’s service in the format requested by AT&T. In addition, Supplier shall provide AT&T, by no later than the 25th of each month, with an estimate of current month’s billing including the amount being accrued and details as to how the amount is being calculated. Such estimate shall be provided via email to AT&T’s delegate [*]

Invoice charges (including any training expenses) shall be in accordance with the rates shown in Section 4 Pricing of this Order.

[*] Supplier shall provide a document with each invoice which details the following:

•

Headcount [*] by name, hire date, and months on Program as defined in the Statement of Work.

•

Name or other designation of the training class

•

Program Request Form (PRF) to which the training is billed. If training is cross-promotional (directed by AT&T in writing, and for the benefit of multiple AT&T programs), Supplier will provide a copy of the PRF from AT&T directing the allocation of the resulting expense across the affected programs, as well as a list of the programs across which the expense is to be allocated. The cross-promotional training expense will be allocated, as directed by AT&T, by Supplier across the affected programs (PRF’s)

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

Order No. 20070105.006.C
Order No. 20070105.006.S.009
Page 4 of 7

•

Name of the contact at AT&T who directed Supplier to conduct the training

•

Length, in hours per agent, of the training material covered in the class

•

Start-date of the training class

•

End-date of the training class

•

Number of agents beginning the class

•

Number of agents completing the class

•

Other supporting information as requested by AT&T

The aforementioned information shall be presented in a consistent format satisfactory to AT&T for each invoice. Supplier will attach this information, along with other required back-up data, to the back of a copy of the corresponding invoice.

Maximum Expenditure:

The maximum expenditures for this Order shall not exceed [*] over the life of the Order. Subject to this maximum, the total amount payable by AT&T for the Work shall be determined by applying the stated rate of applicable compensation set forth in this Order. AT&T shall not be required to pay for Work in excess of this maximum unless Supplier has first secured an amendment to this Order authorizing the increased expenditure.

Program Manager/Point of Contact:

AT&T’s Program Representative is:

[*]

AT&T Contract Manager:

[*]

9. Supplier Point of Contact:

[*]

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

Order No. 20070105.006.C
Order No. 20070105.006.S.009
Page 5 of 7

10.

Orderly Transition:

For the purposes of this Order, “Section 3.27 Orderly Transition” of Order No. 20070105.006.C is hereby deleted in its entirety and replaced with the following:

ORDERLY TRANSITION

In the event of expiration, Cancellation or Termination of this Order, wherein all or some portion of the Work will be either discontinued, performed by AT&T itself, or performed elsewhere for AT&T, Supplier agrees to provide to the extent requested by AT&T in writing, for a period not to exceed eighteen (18) months, its full cooperation in the orderly transition of the Work to AT&T or elsewhere, or its discontinuance. Such orderly transition may include but not necessarily be limited to: (1) transitioning customer accounts and providing current Customer Account Profiles including reducing OS FTEs to such number as AT&T may request from time to time, during any such transition period, (2) packing and preparing for shipment any materials or other inventory to be transferred, (3) provision of reports, training manuals, files, and similar media necessary for continuation of the Work transferred, and (4) continuation of Work at reducing levels if necessary during the transition period and at reduced levels if Work is transferred in part. AT&T will only pay compensation for FTE activities which have been specifically authorized and directed by AT&T in writing pursuant to this clause, and such payment, if any, will be at the rates set forth in the PRICING SCHEDULE. AT&T will provide thirty (30) days advance written notice to Supplier of customer accounts to be transitioned or terminated. In no event shall Supplier discontinue performing services for customer accounts or reduce, increase or vary, the associated FTEs without AT&T’s expressed written consent.

11.

Dispute Resolution — Mediation

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

Order No. 20070105.006.C
Order No. 20070105.006.S.009
Page 6 of 7

If more than one (1) meeting is held between the senior representatives, the meeting shall be held in rotation at the offices of Supplier and AT&T.

12. TITLE TO MATERIAL FURNISHED BY AT&T

Supplier acknowledges and agrees that AT&T has and shall have at all times all right, title and interest in material furnished directly or indirectly to Supplier by AT&T under this Agreement (referred to in this clause as “AT&T Material”). Supplier shall, within ten (10) days of receipt of the AT&T Material, notify AT&T in writing of any claims for quantity variation or quality problems in the AT&T Material furnished to Supplier. Supplier assumes responsibility for any loss or damage to such AT&T Material and shall be liable for the full actual value of the AT&T Material. Supplier shall store the AT&T Material safely, indoors in protected areas approved by AT&T at Supplier’s facility located at Greeley, CO or Grand Junction, CO. If Supplier removes all or any part of the AT&T Material from one building to another, Supplier shall continue to be responsible for loss and damage and Supplier shall give AT&T at least ten (10) days advance notice, in writing, of the removal except when the removal is required to protect the AT&T Material from damage or loss.

AT&T may inspect, inventory and authenticate the account of the AT&T Material during Supplier’s normal business hours. Supplier shall provide AT&T access to the premises wherein all such AT&T Material is located. The AT&T Material shall be kept segregated in an area marked “PROPERTY OF AT&T”. For purposes of this clause, the term “AT&T” shall be deemed to mean AT&T Services, Inc. or the AT&T affiliated or associated company which owns the AT&T Material, as applicable.

Supplier shall bear the risk of loss for all AT&T Material shipped by Supplier.

Supplier shall not allow any security interest, lien, tax lien or other encumbrance (collectively referred to as “encumbrance”) to be placed on any AT&T Material. Supplier shall give AT&T immediate written notice should any third party attempt to place or place an encumbrance on such AT&T Material. Supplier shall indemnify and hold AT&T harmless from any such encumbrance. Supplier shall, at AT&T’s request, promptly execute a “protective notice” UCC-1 form and all other documents reasonably necessary to enable AT&T to protect its interest in such AT&T Material. The parties agree that this Agreement shall constitute the security agreement required by the UCC of the appropriate state.

The obligations assumed by Supplier with respect to the AT&T Material are for the protection of AT&T’s property. If Supplier defaults in carrying out Supplier’s obligations under this Agreement, then, at no cost to AT&T and upon twenty-four (24) hours notice to Supplier, AT&T may Cancel this Agreement in whole or in part or withdraw all or any part of the AT&T Material, or both. Supplier shall, at AT&T’s option, return to AT&T or hold for AT&T’s disposition any or all of such AT&T Material in Supplier’s possession at (a) the completion of the order, (b) expiration, Cancellation or Termination of this Agreement, or (c) the withdrawal of AT&T Material, as provided above.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

Order No. 20070105.006.C
Order No. 20070105.006.S.009
Page 7 of 7

13.

Name of Affiliate Ordering Services:

AT&T Operations, Inc.


STARTEK, INC.		AT&T Services, Inc.

By: /s/ Patrick M. Hayes		By: /s/ Keith Connolly

Printed Name: Patrick M. Hayes		Printed Name: Keith Connolly
Title: COO		Title: Vice President, Global Strategic Sourcing
Date: 5 June 2008		Date: 5/23/08

		On behalf of AT&T Operations, Inc.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

EX-10.20 11 c74453exv10w20.htm EXHIBIT 10.20 Filed by Bowne Pure Compliance

Exhibit 10.20

High Speed Service Delivery (“HSSD”) Order Provisioning

20070105.006.S.010

Between

Startek, Inc.

And

AT&T Services, Inc.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.010
High Speed Ordering
Page 1 of 6

General Agreement Order No. 20070105.006.S.010

Description of Material and/or Services:

Supplier shall provide High Speed Service Delivery (“HSSD”) Ordering Services to AT&T as determined by AT&T (“Program”), pursuant to Attachment A entitled “STATEMENT OF WORK”, dated April 1, 2008 (“Work”) attached hereto and hereby made a part of this Order.

Duration of Order:

Location:

Supplier shall perform the Work at the following locations: Grand Junction, CO

Pricing:

The following Pricing schedule shows the amounts to be paid to Supplier for the various Work to be performed under this Order.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.010
High Speed Ordering
Page 2 of 6

Billable [*] Rates:

The following rates shall apply to billable Order Specialist FTEs:

Rates are based on [*]


Description	1 - 75 FTEs		75 + FTEs

Order Specialist FTE [] Rate	$	[*]	$	[*]

[*] Training — pursuant to Section D Training	$	[*]	$	[*]


*		Any FTEs supporting similar type programs, whether added specifically to this Order or issued under a separate order will be added to this Orders existing FTE headcount and the cumulative volume of FTEs will be used to determine applicable volume tiered pricing for this Order. For Example: AT&T enters into a separate order with Startek to provide 50 FTEs to support another similar type program. The existing 28 FTEs under this Order will then be compensated at the next volume tiered price of $[*] since the total combined FTE head count, i.e.78, is at the next volume tier rate threshold.

Supplier agrees that the rates provided above are all inclusive of the costs for the Program, which include, but are not limited to the following items, and no other charges shall be billed to AT&T.

1.		Training [*]

2.		Dedicated Area Managers

3.		Dedicated AT&T Global Business Services (“GBS”) Reports Analyst

4.		Dedicated AT&T GBS Process Managers

5.		Dedicated AT&T GBS Escalation Managers

6.		Travel and Living

7.		Pagers

8.		Programming (e.g. scripting, legacy programming and all programming production support and maintenance functions)

9.		Program / Account management functions and personnel

10.		Development and issuance of reports

11.		Recruiting of Order Specialist

12.		Processing Downtime Forms

13.		System Access and Requirements

14.		Systems — Managing and maintaining equipment and access

15.		Postage

[*]

17.		Copies

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.010
High Speed Ordering
Page 3 of 6

Holiday [*]:

AT&T agrees to compensate Supplier [*] for work performed by Order Specialist headcount during the Holidays shown in Section I Holidays that were previously approved by AT&T in writing.

Invoices/Billing Information:

If Supplier is enabled to transact business with AT&T using the internet-based Ariba Supplier Network (“ASN”), Supplier agrees to submit invoices in electronic form to AT&T’s Accounts Payable organization through the ASN. If Supplier is not so enabled, it agrees to submit invoices to AT&T Accounts Payable, PO Box 66960, St. Louis, MO 63166-6960. Invoices against this Order shall reflect billing number [TBD] exactly as shown and shall be submitted to AT&T’s Program Representative shown herein. Supplier shall ensure that AT&T’s Program Representative actually receives such invoices no later than the tenth (10^th) of each month for the prior month’s service in the format requested by AT&T. In addition, Supplier shall provide AT&T, by no later than the 25th of each month, with an estimate of current month’s billing including the amount being accrued and details as to how the amount is being calculated. Such estimate shall be provided via email to AT&T’s delegate [*]

Invoice charges (including any training expenses) shall be in accordance with the rates shown in Section 4 Pricing of this Order.

[*] Supplier shall provide a document with each invoice which details the following:

•

Headcount [*] by name, hire date, and months on Program.

•

Name or other designation of the training class

•

Name of the contact at AT&T who directed Supplier to conduct the training

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.010
High Speed Ordering
Page 4 of 6

•

Length, in hours per agent, of the training material covered in the class

•

Start-date of the training class

•

End-date of the training class

•

Number of agents beginning the class

•

Number of agents completing the class

•

Other supporting information as requested by AT&T

Maximum Expenditure:

The maximum expenditure shall not exceed [*] over the life of this Order. Subject to this maximum, the total amount payable by AT&T for the Work shall be determined by applying the stated rate of applicable compensation set forth in this Order. AT&T shall not be required to pay for Work in excess of this maximum unless Supplier has first secured an amendment to this Order authorizing the increased expenditure.

Program Manager/Point of Contact:

AT&T’s Program Representatives is:

[*]

AT&T Contract Manager:

[*]

Supplier Point of Contact:

[*]

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.010
High Speed Ordering
Page 5 of 6

10.

Orderly Transition:

For the purposes of this Order, “Section 3.27 Orderly Transition” of Agreement No. 20070105.006.C is hereby deleted in its entirety and replaced with the following:

ORDERLY TRANSITION

In the event of expiration, Cancellation or Termination of this Order, wherein all or some portion of the Work will be either discontinued, performed by AT&T itself, or performed elsewhere for AT&T, Supplier agrees to provide to the extent requested by AT&T in writing, for a period not to exceed eighteen (18) months, its full cooperation in the orderly transition of the Work to AT&T or elsewhere, or its discontinuance. Such orderly transition may include but not necessarily be limited to: (1) transitioning customer accounts including reducing headcount to such number as AT&T may request from time to time, during such any such transition period, (2) packing and preparing for shipment any materials or other inventory to be transferred, (3) provision of reports, training manuals, files, and similar media necessary for continuation of the Work transferred, and (4) continuation of Work at reducing levels if necessary during the transition period and at reduced levels if Work is transferred in part. AT&T will only pay compensation for OS activities which have been specifically authorized and directed by AT&T in writing pursuant to this clause, and such payment, if any, will be at the rates set forth in Section 4 Pricing. AT&T will provide thirty (30) days advance written notice to Supplier of customer accounts to be transitioned or terminated. In no event shall Supplier discontinue performing services for customer accounts or reduce, increase or vary, the associated headcount without AT&T’s expressed written consent.

11.

Dispute Resolution — Mediation

If more than one (1) meeting is held between the senior representatives, the meeting shall be held in rotation at the offices of Supplier and AT&T.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.010
High Speed Ordering
Page 6 of 6

12.

Name of Affiliate Ordering Services:

AT&T Operations, Inc.


STARTEK, INC.		AT&T Services, Inc.

By: /s/ Patrick M. Hayes		By: /s/ Keith Connolly

Printed Name: Patrick M. Hayes		Printed Name: Keith Connolly
Title: COO		Title: Vice President, Global Strategic Sourcing
Date: 5 June 08		Date: 5/23/08

		On behalf of AT&T Operations, Inc.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

EX-10.21 12 c74453exv10w21.htm EXHIBIT 10.21 Filed by Bowne Pure Compliance

Exhibit 10.21


*		Material has been omitted pursuant to a request for confidential treatment and such material has been filed separately with the Securities and Exchange Commission. An asterisk within brackets denotes omissions.

Local Order Provisioning

20070105.006.S.011

Between

Startek, Inc.

And

AT&T Services, Inc.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.S.C
Order No. 20070105.007.S.011
Page 1 of 6

General Agreement Order No. 20070105.006.S.011

1.		Description of Material and/or Services:

		Supplier shall provide Local Ordering services and Local Ordering Support Services to AT&T as determined by AT&T (“Program”), pursuant to Attachment A entitled “STATEMENT OF WORK”, dated April 1, 2008 (“Work”) attached hereto and hereby made a part of this Order.

2.		Duration of Order:

		This Order will continue in effect for a term expiring on March 31, 2010, unless it is Cancelled or Terminated before that date. The Parties may extend the term of this Order beyond that date by mutual written agreement. The terms and conditions of this Order cover all Services started prior to the execution of this Order, from April 1, 2008 up until execution of this Order.

3.		Location:

		Supplier shall perform the Work at the following locations: Greeley CO and Grand Junction, CO

4.		Pricing:

		The following Pricing schedule shows the amounts to be paid to Supplier for the various Work to be performed under this Order.

		Full Time Equivalent (“FTE”) Order Specialists (“OS”) Monthly, the AT&T and Supplier will mutually determine and agree in writing to the FTE headcount quantity of Order Specialists based on [], pursuant to “Section C — Volume and Forecasting Process of Attachment A” to be invoiced according to the rates below. Invoices shall be submitted monthly based on [] and shall exclude any non-production activity, including but not limited to the following: lunchtime, break time, holidays, vacations and sick-time.

Billable [*] Rates:

The following rates shall apply to billable Order Specialist FTEs:
Rates are based on [*]

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and
their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.S.C
Order No. 20070105.007.S.011
Page 2 of 6


Description	1 – 75 FTEs		75 + FTEs

Order Specialist FTE [] Rate	$	[*]	$	[*]

[*] Training – pursuant to Section D Training	$	[*]	$	[*]


*		Any FTEs supporting similar type programs, whether added specifically to this Order or issued under a separate order will be added to this Orders existing FTE headcount and the cumulative volume of FTEs will be used to determine applicable volume tiered pricing for this Order. For Example: AT&T enters into a separate order with Startek to provide 40 FTEs to support another similar type program. The existing 38 FTEs under this Order will then be compensated at the next volume tiered price of $[*] since the total combined FTE head count, i.e.78, is at the next volume tier rate threshold.

		Supplier agrees that the rates provided above are all inclusive of the costs for the Program, which include, but are not limited to the following items, and no other charges shall be billed to AT&T.

1.		Training [*]

2.		Dedicated Area Managers

3.		Dedicated AT&T Global Business Services (“GBS”) Reports Analyst

4.		Dedicated AT&T GBS Process Managers

5.		Dedicated AT&T GBS Escalation Managers

6.		Travel and Living

7.		Pagers

8.		Programming (e.g. scripting, legacy programming and all programming production support and maintenance functions)

9.		Program / Account management functions and personnel

10.		Development and issuance of reports

11.		Recruiting of Order Specialist

12.		Processing Downtime Forms

13.		System Access and Requirements

14.		Systems — Managing and maintaining equipment and access

15.		Postage

[*]

17.		Copies

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.S.C
Order No. 20070105.007.S.011
Page 3 of 6

Holiday [*]:

AT&T agrees to compensate Supplier [*] for work performed by Order Specialist headcount during the Holidays shown in Section I Holidays that were previously approved by AT&T in writing.

		Where the parties are to mutually agree on the headcount quantity, [*] or the course of conduct or activity under this Order, or any other provisions of this Order where the parties may need to mutually agree, in the event the parties cannot mutually agree within ten (10) business days, Supplier agrees to carry out the expressed requests of AT&T provided such requests are not unreasonable. In addition, the parties agree to also promptly escalate to the next level of management for resolution.

5.		Invoices/Billing Information:

		If Supplier is enabled to transact business with AT&T using the internet-based Ariba Supplier Network (“ASN”), Supplier agrees to submit invoices in electronic form to AT&T’s Accounts Payable organization through the ASN. If Supplier is not so enabled, it agrees to submit invoices to AT&T Accounts Payable, PO Box 66960, St. Louis, MO 63166-6960. Invoices against this Order shall reflect billing number [TBD] exactly as shown for Voice Ordering Services; and Invoices for Corporate ITS shall be submitted directly to AT&T’s Corporate ITS Program Representative shown herein. Supplier shall ensure that AT&T’s Program Representatives actually receives such invoices no later than the tenth (10^th) of each month for the prior month’s service in the format requested by AT&T. In addition, Supplier shall provide AT&T, by no later than the 25th of each month, with an estimate of current month’s billing including the amount being accrued and details as to how the amount is being calculated. Such estimate shall be provided via email to AT&T’s delegate [*].

		Invoice charges (including [*]) shall be in accordance with the rates shown in Section 4 Pricing of this Order.

	[*]		Supplier shall provide a document with each invoice which details the following:

	•		Headcount [*] by name, hire date, and months on Program as defined in the Statement of Work.

	•		Name or other designation of the training class

	•		Program Request Form (PRF) to which the training is billed. If training is cross-promotional (directed by AT&T in writing, and for the benefit of multiple AT&T programs), Supplier will provide a copy of the PRF from AT&T directing the allocation of the resulting expense across the affected programs, as well as a list of the programs across which the expense is to be allocated. The cross-promotional training expense will be allocated, as directed by AT&T, by Supplier across the affected programs (PRF’s)

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.S.C
Order No. 20070105.007.S.011
Page 4 of 6

	•		Name of the contact at AT&T who directed Supplier to conduct the training

	•		Length, in hours per agent, of the training material covered in the class

	•		Start-date of the training class

	•		End-date of the training class

	•		Number of agents beginning the class

	•		Number of agents completing the class

	•		Other supporting information as requested by AT&T

6.		Maximum Expenditure:

		The maximum expenditure under this Order shall not exceed [*] over the life of this Order. Subject to this maximum, the total amount payable by AT&T for the Work shall be determined by applying the stated rate of applicable compensation set forth in this Order. AT&T shall not be required to pay for Work in excess of this maximum unless Supplier has first secured an amendment to this Order authorizing the increased expenditure.

7.		Program Manager/Point of Contact:

		AT&T’s Program Representative is:

[*]

AT&T Contract Manager:

[*]

Supplier Point of Contact:

[*]

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.S.C
Order No. 20070105.007.S.011
Page 5 of 6

10.

Orderly Transition:

For the purposes of this Order, “Section 3.27 Orderly Transition” of Agreement No. 20070105.006.C is hereby deleted in its entirety and replaced with the following:

ORDERLY TRANSITION

In the event of expiration, Cancellation or Termination of this Order, in whole or in part, wherein all or some portion of the Work will be performed by AT&T itself or elsewhere, Supplier agrees to provide its full cooperation in the orderly transition of the Work to AT&T or elsewhere, including, but not necessarily limited to packing and preparing for shipment any materials or other inventory to be transferred, provision of reports, files and similar media necessary for continuation of the Work transferred, continuation of Work at reducing levels if necessary during a transition period and at reduced levels if Work is transferred in part. Prices for additional Work such as packing and preparation for shipment, and revision of prices resulting from revised volumes, if necessary, shall be proposed by Supplier and shall be mutually agreed upon by the parties Supplier shall also, at its sole cost and expense, cooperate with AT&T in returning any and all orders, associated documentation and other related information and material to AT&T or elsewhere, in an orderly fashion to minimize negative customer impacts and ensure an orderly migration and transfer of work.

11.

Dispute Resolution — Mediation

	a.		The Parties will attempt in good faith to promptly resolve any controversy or claim arising out of or relating to this Order through negotiations between authorized representatives of the Parties, before resorting to other remedies available to them.

	b.		If a controversy or claim should arise which is not settled as specified in Subsection a., representatives of each Party who are authorized to resolve the controversy or claim will meet at a location designated by AT&T, at least once, and will attempt to, and are empowered to resolve the matter. Either representative may request this meeting within fourteen (14) days of such request (the “first meeting”).

	c.		Unless the Parties otherwise agree, if the matter has not been resolved within twenty-one (21) days of the first meeting, the representatives shall refer the matter to more senior representatives, who shall have full authority to settle the dispute. Such senior representatives will meet for negotiations within fourteen (14) days of the end of the twenty-one (21) day period referred to above, at a site designated by AT&T. Three (3) business days prior to this scheduled meeting, the Parties shall exchange memoranda stating the issue(s) in dispute and their positions, summarizing the negotiations which have taken place, and attaching relevant documents.

	d.		If more than one (1) meeting is held between the senior representatives, the meeting shall be held in rotation at the offices of Supplier and AT&T.

	e.		If the matter has not been resolved within thirty (30) days of the first meeting of the senior representatives (which period may be extended by mutual agreement), the Parties will attempt in good faith to resolve the controversy or claim in accordance with the American Arbitration Association’s then current Commercial Mediation Rules.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.S.C
Order No. 20070105.007.S.011
Page 6 of 6

12.

Name of Affiliate Ordering Services:

AT&T Operations, Inc.


STARTEK, INC.		AT&T Services, Inc.

By:	/s/ Patrick M. Hayes	By:	/s/ Keith Connolly
Printed Name: Patrick M. Hayes		Printed Name: Keith Connolly
Title: COO		Title: Vice President, Global Strategic Sourcing
Date: 5 June 08		Date: 5/23/08

		On behalf of AT&T Operations, Inc.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

EX-10.22 13 c74453exv10w22.htm EXHIBIT 10.22 Filed by Bowne Pure Compliance

Exhibit 10.22


*		Material has been omitted pursuant to a request for confidential treatment and such material has been filed separately with the Securities and Exchange Commission. An asterisk within brackets denotes omissions.

CPE Order Processing

20070105.006.S.012

Between

Startek, Inc.

And

AT&T Services, Inc.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates
and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.12
CPE Order Processing
Page 1 of 5

General Agreement Order No. 20070105.006.S.012

1.		Description of Material and/or Services:

		Supplier shall provide support of AT&T’s Customer Premise Equipment (“CPE”) Order Processing and Support (“Program”), pursuant to Attachment A entitled “STATEMENT OF WORK”, dated April 1, 2008 (“Work”) attached hereto and hereby made a part of this Order.

2.		Duration of Order:

		This Order will continue in effect for a term expiring on March 31, 2009, unless it is Cancelled or Terminated before that date. The terms and conditions of this Order cover all Services started prior to the execution of this Order, from April 1, 2008 up until execution of this Order.

		AT&T shall have the right to extend the duration period specified in this Order for up to twelve (12) months by giving Supplier 45 days prior written notice, at prices no greater than those set forth in this Order.

3.		Location:

		Supplier shall perform the Work at the following locations: Greeley, CO

4.		Pricing:

		The following Pricing schedule shows the amounts to be paid to Supplier for Work to be performed under this Order for Full Time Equivalent (“FTE”) Agents.

		Invoices shall be submitted monthly based on [*] and shall exclude any non-production activity, including but not limited to the following: lunchtime, break time, holidays, vacations and sick-time.


Description	*[] Rate**
Agent FTE [*] Rate	$	[*]
Area Manager	$	[*]
* [*] Training – pursuant to Section D Training	$	[*]


*		Does not include [*], which shall be at Supplier’s sole cost and expense. Supplier agrees that the rates provided above are all inclusive of the costs for the Program, which include, but are not limited to the following items, and no other charges shall be billed to AT&T.

1.		Training [*]

2.		Dedicated Reports Analyst

4.		Dedicated Process Managers

5.		Dedicated Escalation Managers

6.		Dedicated Supervisors

7.		Travel and Living

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates
and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.12
CPE Order Processing
Page 2 of 5

8.		Pagers

9.		Programming (e.g. scripting, legacy programming and all programming production support and maintenance functions)

10.		Program / Account management functions and personnel

11.		Development and issuance of reports

12.		Recruiting of Order Specialist

13.		Processing Downtime Forms

14.		System Access and Requirements

15.		Systems – Managing and maintaining equipment and access

16.		Postage

[*]

18.		Copies

Holiday [*]:

AT&T agrees to compensate Supplier [*] for work performed by Order Specialist headcount during the Holidays shown in Section I Holidays that were previously approved by AT&T in writing.

Where the parties are to mutually agree on the headcount quantity, [*] the course of conduct or activity under this Order, or any other provisions of this Order where the parties may need to mutually agree, in the event the parties cannot mutually agree within ten (10) business days, Supplier agrees to carry out the expressed requests of AT&T provided such requests are not unreasonable. In addition, the parties agree to also promptly escalate to the next level of management for resolution.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates
and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.12
CPE Order Processing
Page 3 of 5

5.		Invoices/Billing Information:

		If Supplier is enabled to transact business with AT&T using the internet-based Ariba Supplier Network (“ASN”), Supplier agrees to submit invoices in electronic form to AT&T’s Accounts Payable organization through the ASN. If Supplier is not so enabled, it agrees to submit invoices to AT&T Accounts Payable, PO Box 66960, St. Louis, MO 63166-6960. Invoices against this Order shall reflect billing number PO149990 exactly as shown and shall be submitted to AT&T’s Program Representative shown herein. Supplier shall ensure that AT&T’s Program Representative actually receives such invoices no later than the tenth (10^th) of each month for the prior month’s service in the format requested by AT&T. In addition, Supplier shall provide AT&T, by no later than the 25th of each month, with an estimate of current month’s billing including the amount being accrued and details as to how the amount is being calculated. Such estimate shall be provided via email to AT&T’s delegate [*]

		Invoice charges (including any training expenses) shall be in accordance with the rates shown in Section 4 Pricing of this Order.

	[*]		Supplier shall provide a document with each invoice which details the following:

	•		Headcount [*] by name, hire date, and months on Program.

	•		Name or other designation of the training class

	•		Program Request Form (PRF) to which the training is billed. If training is cross-promotional (directed by AT&T in writing, and for the benefit of multiple AT&T programs), Supplier will provide a copy of the PRF from AT&T directing the allocation of the resulting expense across the affected programs, as well as a list of the programs across which the expense is to be allocated. The cross-promotional training expense will be allocated, as directed by AT&T, by Supplier across the affected programs (PRF’s)

	•		Name of the contact at AT&T who directed Supplier to conduct the training

	•		Length, in hours per agent, of the training material covered in the class

	•		Start-date of the training class

	•		End-date of the training class

	•		Number of agents beginning the class

	•		Number of agents completing the class

	•		Other supporting information as requested by AT&T

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates
and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.12
CPE Order Processing
Page 4 of 5

6.		Maximum Expenditure:

		The maximum expenditure shall not exceed [*] over the life of this Order. Subject to this maximum, the total amount payable by AT&T for the Work shall be determined by applying the stated rate of applicable compensation set forth in this Order. AT&T shall not be required to pay for Work in excess of this maximum unless Supplier has first secured an amendment to this Order authorizing the increased expenditure.

7.		Program Manager/Point of Contact:

		AT&T’s Program Representatives is:

[*]

AT&T Contract Manager:

[*]

Supplier Point of Contact:

[*]

10.

Dispute Resolution — Mediation

	a.		The Parties will attempt in good faith to promptly resolve any controversy or claim arising out of or relating to this Order through negotiations between authorized representatives of the Parties, before resorting to other remedies available to them.

	b.		If a controversy or claim should arise which is not settled as specified in Subsection a., representatives of each Party who are authorized to resolve the controversy or claim will meet at a location designated by AT&T, at least once, and will attempt to, and are empowered to resolve the matter. Either representative may request this meeting within fourteen (14) days of such request (the “first meeting”).

	c.		Unless the Parties otherwise agree, if the matter has not been resolved within twenty-one (21) days of the first meeting, the representatives shall refer the matter to more senior representatives, who shall have full authority to settle the dispute. Such senior representatives will meet for negotiations within fourteen (14) days of the end of the twenty-one (21) day period referred to above, at a site designated by AT&T. Three (3) business days prior to this scheduled meeting, the Parties shall exchange memoranda stating the issue(s) in dispute and their positions, summarizing the negotiations which have taken place, and attaching relevant documents.

	d.		If more than one (1) meeting is held between the senior representatives, the meeting shall be held in rotation at the offices of Supplier and AT&T.

	e.		If the matter has not been resolved within thirty (30) days of the first meeting of the senior representatives (which period may be extended by mutual agreement), the Parties will attempt in good faith to resolve the controversy or claim in accordance with the American Arbitration Association’s then current Commercial Mediation Rules.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates
and their third party representatives, except under written agreement by the contracting Parties.

Agreement No. 20070105.006.C
Order No. 20070105.006.S.12
CPE Order Processing
Page 5 of 5

11.

Name of Affiliate Ordering Services:

AT&T Solutions Inc.


STARTEK, INC.		AT&T Services, Inc.

By:	/s/ A. Laurence Jones	By:	/s/ Richard Steadman

Printed Name: A. Laurence Jones		Printed Name: Richard Steadman
Title: CEO		Title: Director, Global Strategic Sourcing
Date: 10 July 2008		Date: 7 July 2008

		On behalf of AT&T Solutions Inc.

Proprietary Information
The information contained in this Agreement is not for use or disclosure outside AT&T, Supplier, their Affiliates and their third party representatives, except under written agreement by the contracting Parties.

EX-10.23 14 c74453exv10w23.htm EXHIBIT 10.23 Filed by Bowne Pure Compliance

Exhibit 10.23

FOURTH AMENDMENT TO CREDIT AGREEMENT

THIS AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is entered into as of June 30, 2003, by and between STARTEK, INC., a Delaware corporation and STARTEK USA, INC., a Colorado corporation (“Borrower”), and WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”).

RECITALS

WHEREAS, Borrower is currently indebted to Bank pursuant to the terms and conditions of that certain Credit Agreement between Borrower and Bank dated as of June 30, 2003, as amended from time to time (“Credit Agreement”).

WHEREAS, Bank and Borrower have agreed to certain changes in the terms and conditions set forth in the Credit Agreement and have agreed to amend the Credit Agreement to reflect said changes.

NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree that the Credit Agreement shall be amended as follows:

1. Section 4.9 (a) and (b) is hereby deleted in its entirety, and the following substituted therefor:

“(a) Tangible Net Worth measured at the end of each fiscal quarter end, with “Tangible Net Worth” defined as the aggregate of total stockholders’ equity plus subordinated debt less any intangible assets, not at any time less than $95,000,000.00 through December 31, 2006 and shall increase (but never decrease) at each subsequent fiscal quarter end by an amount equal to 25% of net income (but only if positive) for each fiscal quarter then ended. Base was reset to $95,000,000 with June 2007 Amendment; therefore, first compliance with reset base is at June 30, 2007.

(b) Net income after taxes not less than $1.00 on a quarterly basis, determined as of each fiscal quarter end.”

2. Bank is aware that Borrower is in breach of Section 4.9(b) of the Credit Agreement for the period ending March 31, 2008, which requires that Borrower not have a net loss for such period. Bank has decided to waive its default rights with respect to this breach for the period ending March 31, 2008. This waiver applies only to this specific instance. It is not a waiver of any subsequent breach of the same provision of the Agreement, nor is it a waiver of any breach of any other provision of the Agreement. Bank reserves all of the rights, powers and remedies available to Bank under the Credit Agreement and any related documents, including the right to cease making advances and the right to accelerate any indebtedness, if any subsequent breach of the same provision or any other provision of the Agreement should occur.

3. In consideration of the changes set forth herein and as a condition to the effectiveness hereof, immediately upon signing this Amendment Borrower shall pay to Bank a non-refundable fee of $5,000.00.

- 1 -

4. Except as specifically provided herein, all terms and conditions of the Credit Agreement remain in full force and effect, without waiver or modification. All terms defined in the Credit Agreement shall have the same meaning when used in this Amendment. This Amendment and the Credit Agreement shall be read together, as one document.

5. Borrower hereby remakes all representations and warranties contained in the Credit Agreement and reaffirms all covenants set forth therein. Borrower further certifies that as of the date of this Amendment there exists no Event of Default as defined in the Credit Agreement, nor any condition, act or event which with the giving of notice or the passage of time or both would constitute any such Event of Default.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the day and year first written above.


STARTEK, INC.		WELLS FARGO BANK NATIONAL ASSOCIATION

By:	/s/ David Durham	By:	/s/ Wendee Crowley
TITLE: EVP/CFO			Wendee Crowley, Vice President

By:	/s/ Sylvia A. Church
TITLE: VP Controller

STARTEK, INC.

By:	/s/ David Durham
TITLE: EVP/CFO

By:	/s/ Sylvia A. Church
TITLE: VP Controller

- 2 -

EX-10.24 15 c74453exv10w24.htm EXHIBIT 10.24 Filed by Bowne Pure Compliance

Exhibit 10.24

FIFTH AMENDMENT TO CREDIT AGREEMENT

THIS AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is entered into as of June 30, 2008, by and between STARTEK, INC., a Delaware corporation and STARTEK USA, INC., a Colorado corporation (“Borrower”), and WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”).

RECITALS

WHEREAS, Bank and Borrower have agreed to certain changes in the terms and conditions set forth in the Credit Agreement and have agreed to amend the Credit Agreement to reflect said changes.

NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree that the Credit Agreement shall be amended as follows:

1. Section 1.1 (a) is hereby deleted in its entirety, and the following substituted therefor:

"(a) Line of Credit. Subject to the terms and conditions of this Agreement, Bank hereby agrees to make advances to Borrower from time to time up to and including June 30, 2009, not to exceed at any time the aggregate principal amount of Ten Million Dollars ($10,000,000.00) (“Line of Credit”), the proceeds of which shall be used to finance Borrower’s working capital requirements, general corporate purposes, acquisitions and stock repurchases. Borrower’s obligation to repay advances under the Line of Credit shall be evidenced by a promissory note dated as of June 30, 2008 (“Line of Credit Note”), all terms of which are incorporated herein by this reference.”

2. The following is hereby added to the Credit Agreement as Section 1.2 (c):

“(c) Unused Commitment Fee. Borrower shall pay to Bank, for each fiscal quarter that Borrower’s Tangible Net Worth is less than $110,000,000, an unused commitment fee in an amount equal to one eighth of one percent (.125%) per annum (computed on the basis of a 360-day year, actual days elapsed) of the average daily unused amount of the Line of Credit, which fee shall be calculated on a quarterly basis by Bank and shall be due and payable by Borrower in arrears within ten (10) days after each billing is sent by Bank.”

3. The following is hereby added to the Credit Agreement as Section 1.4:

“SECTION 1.4. COLLATERAL.

As security for all indebtedness and other obligations of Borrower to Bank subject hereto, Borrower hereby grants to Bank security interests of first priority in all Borrower’s accounts receivable, other rights to payment, and general intangibles.

All of the foregoing shall be evidenced by and subject to the terms of such security agreements, financing statements, deeds or mortgages, and other documents as Bank shall reasonably require, all in form and substance satisfactory to Bank. Borrower shall pay to Bank immediately upon demand the full amount of all charges, costs and expenses (to include fees paid to third parties and all allocated costs of Bank personnel), expended or incurred by Bank in connection with any of the foregoing security, including without limitation, filing and recording fees and costs of appraisals, audits and title insurance.”

4. Section 4.9 (a) is hereby deleted in its entirety, and the following substituted therefor:

“(a) Tangible Net Worth measured at the end of each fiscal quarter, with “Tangible Net Worth” defined as the aggregate of total stockholders’ equity plus subordinated debt less any intangible assets, not at any time less than $105,000,000.00 through December 31, 2007 and shall increase (but never decrease) at each subsequent fiscal quarter end by an amount equal to 25% of net income (but only if positive) for each fiscal quarter then ended.”

5. Bank is aware that Borrower is in breach of Section 4.9(b) of the Credit Agreement for the period ending June 30, 2008, which requires that Borrower not have a net loss for such period. Bank has decided to waive its default rights with respect to this breach for the period ending June 30, 2008. This waiver applies only to this specific instance. It is not a waiver of any subsequent breach of the same provision of the Agreement, nor is it a waiver of any breach of any other provision of the Agreement. Bank reserves all of the rights, powers and remedies available to Bank under the Credit Agreement and any related documents, including the right to cease making advances and the right to accelerate any indebtedness, if any subsequent breach of the same provision or any other provision of the Agreement should occur.

6. Section 4.9 (b) is hereby deleted in its entirety, without substitution.

7. Section 4.9 (c) is hereby renumbered as Section 4.9 (b).

8. Section 5.2 is hereby deleted in its entirety, and the following substituted therefor:

“SECTION 5.2. OTHER INDEBTEDNESS. Create, incur, assume or permit to exist any indebtedness or liabilities resulting from borrowings, loans or advances, whether secured or unsecured, matured or unmatured, liquidated or unliquidated, joint or several, that exceeds $5,000,000.00 in the aggregate during the term of the loan, except (a) the liabilities of Borrower to Bank, and (b) any other liabilities of Borrower existing as of, and disclosed to Bank prior to, the date hereof.”

9. Section 5.5 is hereby deleted in its entirety, and the following substituted therefor:

“SECTION 5.5. LOANS, ADVANCES, INVESTMENTS. Make any loans or advances to or investments in any person or entity in excess of $5,000,000.00 during the term of the loan, except any of the foregoing existing as of, and disclosed to Bank prior to, the date hereof. This excludes current trading or investment for sale portfolio.”

10. Section 5.7 is hereby deleted in its entirety, and the following substituted therefor:

“SECTION 5.7 PLEDGE OF ASSETS. Mortgage, pledge, grant or permit to exist a security interest in, or lien upon, all or any portion of Borrower’s assets now owned or hereafter acquired that exceeds $5,000,000.00 in the aggregate during the term of the loan, except any of the foregoing in favor of Bank or which is existing as of, and disclosed to Bank in writing prior to, the date hereof. Borrower shall allow no person or entity a security interest in, or lien upon, its accounts receivable or inventory without prior written consent of Bank.”

11. In consideration of the changes set forth herein and as a condition to the effectiveness hereof, immediately upon signing this Amendment, Borrower shall pay to Bank a non-refundable amendment fee of $5,000.00.

12. Except as specifically provided herein, all terms and conditions of the Credit Agreement remain in full force and effect, without waiver or modification. All terms defined in the Credit Agreement shall have the same meaning when used in this Amendment. This Amendment and the Credit Agreement shall be read together, as one document.

13. Borrower hereby remakes all representations and warranties contained in the Credit Agreement and reaffirms all covenants set forth therein. Borrower further certifies that as of the date of this Amendment there exists no Event of Default as defined in the Credit Agreement, nor any condition, act or event which with the giving of notice or the passage of time or both would constitute any such Event of Default.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the day and year first written above.


	STARTEK, INC.
	By:	/s/ David G. Durham
		David G. Durham, Chief Financial Officer/Treasurer

	By:	/s/ Sylvia A. Church
		Sylvia A. Church, Vice President/Controller

	STARTEK USA, INC.
	By:	/s/ David G. Durham
		David G. Durham, Chief Financial Officer/Treasurer

	By:	/s/ Sylvia A. Church
		Sylvia A. Church, Vice President/Controller


	WELLS FARGO BANK, NATIONAL ASSOCIATION
	By:	/s/ Wendee Crowley
		Wendee Crowley, Vice President



WELLS FARGO		*REVOLVING LINE OF CREDIT NOTE*

$10,000,000.00		Denver, Colorado
		June, 30, 2008

FOR VALUE RECEIVED, the undersigned STARTEK, INC. and STARTEK USA, INC. (“Borrower”) promises to pay to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”) at its office at Colorado RCBO, 1700 Lincoln Street, 8th Floor, Denver, CO 80203, or at such other place as the holder hereof may designate, in lawful money of the United States of America and in immediately available funds, the principal sum of $10,000,000.00, or so much thereof as may be advanced and be outstanding, with interest thereon, to be computed on each advance from the date of its disbursement as set forth herein.

1. DEFINITIONS:

As used herein, the following terms shall have the meanings set forth after each, and any other term defined in this Note shall have the meaning set forth at the place defined:

1.1 “Business Day” means any day except a Saturday, Sunday or any other day on which commercial banks in Colorado are authorized or required by law to close.

1.2 “Fixed Rate Term” means a period commencing on a Business Day and continuing for 1, 2 or 3 months, as designated by Borrower, during which all or a portion of the outstanding principal balance of this Note bears interest determined in relation to LIBOR; provided however, that no Fixed Rate Term may be selected for a principal amount less than $100,000.00; and provided further, that no Fixed Rate Term shall extend beyond the scheduled maturity date hereof. If any Fixed Rate Term would end on a day which is not a Business Day, then such Fixed Rate Term shall be extended to the next succeeding Business Day.

1.3 “LIBOR” means the rate per annum (rounded upward, if necessary, to the nearest whole 1/8 of 1%) determined by dividing Base LIBOR by a percentage equal to 100% less any LIBOR Reserve Percentage.

(a) “Base LIBOR” means the rate per annum for United States dollar deposits quoted by Bank as the Inter-Bank Market Offered Rate, with the understanding that such rate is quoted by Bank for the purpose of calculating effective rates of interest for loans making reference thereto, on the first day of a Fixed Rate Term for delivery of funds on said date for a period of time approximately equal to the number of days in such Fixed Rate Term and in an amount approximately equal to the principal amount to which such Fixed Rate Term applies. Borrower understands and agrees that Bank may base its quotation of the Inter-Bank Market Offered Rate upon such offers or other market indicators of the Inter-Bank Market as Bank in its discretion deems appropriate including, but not limited to, the rate offered for U.S. dollar deposits on the London Inter-Bank Market.

(b) “LIBOR Reserve Percentage” means the reserve percentage prescribed by the Board of Governors of the Federal Reserve System (or any successor) for “Eurocurrency Liabilities” (as defined in Regulation D of the Federal Reserve Board, as amended), adjusted by Bank for expected changes in such reserve percentage during the applicable Fixed Rate Term.

1.4 “Prime Rate” means at any time the rate of interest most recently announced within Bank at its principal office as its Prime Rate, with the understanding that the Prime Rate is one of Bank’s base rates and serves as the basis upon which effective rates of interest are calculated for those loans making reference thereto, and is evidenced by the recording thereof after its announcement in such internal publication or publications as Bank may designate.

2. INTEREST:

2.1 Interest. The outstanding principal balance of this Note shall bear interest (computed on the basis of a 360-day year, actual days elapsed) either (a) at a fluctuating rate per annum 1.00000% below the Prime Rate in effect from time to time, or (b) at a fixed rate per annum determined by Bank to be 1.50000% above LIBOR in effect on the first day of the applicable Fixed Rate Term. When interest is determined in relation to the Prime Rate, each change in the rate of interest hereunder shall become effective on the date each Prime Rate change is announced within Bank. With respect to each LIBOR selection option selected hereunder, Bank is hereby authorized to note the date, principal amount, interest rate and Fixed Rate Term applicable thereto and any payments made thereon on Bank’s books and records (either manually or by electronic entry) and/or on any schedule attached to this Note, which notations shall be prima facie evidence of the accuracy of the information noted.

2.2 Selection of Interest Rate Options. At any time any portion of this Note bears interest determined in relation to LIBOR, it may be continued by Borrower at the end of the Fixed Rate Term applicable thereto so that all or a portion thereof bears interest determined in relation to the Prime Rate or to LIBOR for a new Fixed Rate Term designated by Borrower. At any time any portion of this Note bears interest determined in relation to the Prime Rate, Borrower may convert all or a portion thereof so that it bears interest determined in relation to LIBOR for a Fixed Rate Term designated by Borrower. At such time as Borrower requests an advance hereunder or wishes to select a LIBOR option for all or a portion of the outstanding principal balance hereof, and at the end of each Fixed Rate Term, Borrower shall give Bank notice specifying: (a) the interest rate option selected by Borrower; (b) the principal amount subject thereto; and (c) for each LIBOR selection, the length of the applicable Fixed Rate Term. Any such notice may be given by telephone (or such other electronic method as Bank may permit) so long as, with respect to each LIBOR selection, (i) if requested by Bank, Borrower provides to Bank written confirmation thereof not later than 3 Business Days after such notice is given, and (ii) such notice is given to Bank prior to 10:00 a.m. on the first day of the Fixed Rate Term, or at a later time during any Business Day if Bank, at it’s sole option but without obligation to do so, accepts Borrower’s notice and quotes a fixed rate to Borrower. If Borrower does not immediately accept a fixed rate when quoted by Bank, the quoted rate shall expire and any subsequent LIBOR request from Borrower shall be subject to a redetermination by Bank of the applicable fixed rate. If no specific designation of interest is made at the time any advance is requested hereunder or at the end of any Fixed Rate Term, Borrower shall be deemed to have made a Prime Rate interest selection for such advance or the principal amount to which such Fixed Rate Term applied.

2.3 Taxes and Regulatory Costs. Borrower shall pay to Bank immediately upon demand, in addition to any other amounts due or to become due hereunder, any and all (a) withholdings, interest equalization taxes, stamp taxes or other taxes (except income and franchise taxes) imposed by any domestic or foreign governmental authority and related in any manner to LIBOR, and (b) future, supplemental, emergency or other changes in the LIBOR Reserve Percentage, assessment rates imposed by the Federal Deposit Insurance Corporation, or similar requirements or costs imposed by any domestic or foreign governmental authority or resulting from compliance by Bank with any request or directive (whether or not having the force of law) from any central bank or other governmental authority and related in any manner to LIBOR to the extent they are not included in the calculation of LIBOR. In determining which of the foregoing are attributable to any LIBOR option available to Borrower hereunder, any reasonable allocation made by Bank among its operations shall be conclusive and binding upon Borrower.

2.4 Payment of Interest. Interest accrued on this Note shall be payable on the last day of each month, commencing July 31, 2008.

2.5 Default Interest. From and after the maturity date of this Note, or such earlier date as all principal owing hereunder becomes due and payable by acceleration or otherwise, the outstanding principal balance of this Note shall bear interest until paid in full at an increased rate per annum (computed on the basis of a 360-day year, actual days elapsed) equal to 4% above the rate of interest from time to time applicable to this Note.

3. BORROWING AND REPAYMENT:

3.1 Borrowing and Repayment. Borrower may from time to time during the term of this Note borrow, partially or wholly repay its outstanding borrowings, and reborrow, subject to all of the limitations, terms and conditions of this Note and of the Credit Agreement between Borrower and Bank defined below; provided however, that the total outstanding borrowings under this Note shall not at any time exceed the principal amount stated above. The unpaid principal balance of this obligation at any time shall be the total amounts advanced hereunder by the holder hereof less the amount of principal payments made hereon by or for Borrower, which balance may be endorsed hereon from time to time by the holder. The outstanding principal balance of this Note shall be due and payable in full on June 30, 2009.

3.2 Advances. Advances hereunder, to the total amount of the principal sum available hereunder, may be made by the holder at the oral or written request of (a) A. Laurence Jones, Sylvia A. Church, or David G. Durham, any one acting alone, who are authorized to request advances and direct the disposition of any advances until written notice of the revocation of such authority is received by the holder at the office designated above, or (b) any person, with respect to advances deposited to the credit of any deposit account of Borrower, which advances, when so deposited, shall be conclusively presumed to have been made to or for the benefit of Borrower regardless of the fact that persons other than those authorized to request advances may have authority to draw against such account. The holder shall have no obligation to determine whether any person requesting an advance is or has been authorized by Borrower.

3.3 Application of Payments. Each payment made on this Note shall be credited first, to any interest then due and second, to the outstanding principal balance hereof. All payments credited to principal shall be applied first, to the outstanding principal balance of this Note which bears interest determined in relation to the Prime Rate, if any, and second, to the outstanding principal balance of this Note which bears interest determined in relation to LIBOR, with such payments applied to the oldest Fixed Rate Term first.

4. PREPAYMENT:

4.1 Prime Rate. Borrower may prepay principal on any portion of this Note which bears interest determined in relation to the Prime Rate at any time, in any amount and without penalty.

4.2 LIBOR. Borrower may prepay principal on any portion of this Note which bears interest determined in relation to LIBOR at any time and in the minimum amount of $100,000.00; provided however, that if the outstanding principal balance of such portion of this Note is less than said amount, the minimum prepayment amount shall be the entire outstanding principal balance thereof. In consideration of Bank providing this prepayment option to Borrower, or if any such portion of this Note shall become due and payable at any time prior to the last day of the Fixed Rate Term applicable thereto by acceleration or otherwise, Borrower shall pay to Bank immediately upon demand a fee which is the sum of the discounted monthly differences for each month from the month of prepayment through the month in which such Fixed Rate Term matures, calculated as follows for each such month:

(a) Determine the amount of interest which would have accrued each month on the amount prepaid at the interest rate applicable to such amount had it remained outstanding until the last day of the Fixed Rate Term applicable thereto.

(b) Subtract from the amount determined in (a) above the amount of interest which would have accrued for the same month on the amount prepaid for the remaining term of such Fixed Rate Term at LIBOR in effect on the date of prepayment for new loans made for such term and in a principal amount equal to the amount prepaid.

(c) If the result obtained in (b) for any month is greater than zero, discount that difference by LIBOR used in (b) above.

Borrower acknowledges that prepayment of such amount may result in Bank incurring additional costs, expenses and/or liabilities, and that it is difficult to ascertain the full extent of such costs, expenses and/or liabilities. Borrower, therefore, agrees to pay the above-described prepayment fee and agrees that said amount represents a reasonable estimate of the prepayment costs, expenses and/or liabilities of Bank. If Borrower fails to pay any prepayment fee when due, the amount of such prepayment fee shall thereafter bear interest until paid at a rate per annum 2.000% above the Prime Rate in effect from time to time (computed on the basis of a 360-day year, actual days elapsed).

5. EVENTS OF DEFAULT:

This Note is made pursuant to and is subject to the terms and conditions of that certain Credit Agreement between Borrower and Bank dated as of June 30, 2003, as amended from time to time (the “Credit Agreement”). Any default in the payment or performance of any obligation under this Note, or any defined event of default under the Credit Agreement, shall constitute an “Event of Default” under this Note.

6. MISCELLANEOUS:

6.1 Remedies. Upon the occurrence of any Event of Default, the holder of this Note, at the holder’s option, may declare all sums of principal and interest outstanding hereunder to be immediately due and payable without presentment, demand, notice of nonperformance, notice of protest, protest or notice of dishonor, all of which are expressly waived by Borrower, and the obligation, if any, of the holder to extend any further credit hereunder shall immediately cease and terminate. Borrower shall pay to the holder immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys’ fees (to include outside counsel fees and all allocated costs of the holder’s in-house counsel), expended or incurred by the holder in connection with the enforcement of the holder’s rights and/or the collection of any amounts which become due to the holder under this Note, and the prosecution or defense of any action in any way related to this Note, including without limitation, any action for declaratory relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Bank or any other person) relating to Borrower or any other person or entity.

6.2 Obligations Joint and Several. Should more than one person or entity sign this Note as a Borrower, the obligations of each such Borrower shall be joint and several.

6.3 Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of Colorado.

IN WITNESS WHEREOF, the undersigned has executed this Note as of the date first written above.


STARTEK, INC.
By:	/s/ David G. Durham
	David G. Durham, Chief Financial Officer/Treasurer

By:	/s/ Sylvia A. Church
	Sylvia A. Church, Vice President/Controller

STARTEK USA, INC.
By:	/s/ David G. Durham
	David G. Durham, Chief Financial Officer/Treasurer

By:	/s/ Sylvia A. Church
	Sylvia A. Church, Vice President/Controller

ADDENDUM TO PROMISSORY NOTE
(PRIME/LIBOR PRICING ADJUSTMENTS)

THIS ADDENDUM is attached to and made a part of that certain promissory note executed by STARTEK, INC. and STARTEK USA, INC. (“Borrower”) and payable to WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”), or order, dated as of June 30, 2008, in the principal amount of Ten Million Dollars ($10,000,000.00) (the “Note”).

The following provisions are hereby incorporated into the Note to reflect the interest rate adjustments agreed to by Bank and Borrower:

INTEREST RATE ADJUSTMENTS:

(a) Initial Interest Rates. The initial interest rates applicable to this Note shall be the rates set forth in the “Interest” paragraph herein.

(b) Interest Rate Adjustments. In addition to any interest rate adjustments resulting from changes in the Prime Rate, Bank shall adjust the Prime Rate and LIBOR margins used to determine the rates of interest applicable to this Note on a quarterly basis, commencing with Borrower’s fiscal quarter ending June 30, 2008, if required to reflect a change in Borrower’s ratio of Total Tangible Net Worth (as defined in the Credit Agreement referenced herein), in accordance with the following grid:


	Applicable			Applicable			Unused
	Prime Rate			LIBOR			Commitment
Total Tangible Net Worth	Margin			Margin			Fee

$110,000,000.00 or greater		-1.00	%		1.50	%	None

less than $110,000,000.00		-.75	%		1.75	%		.125	%

Each such adjustment shall be effective on the first Business Day of Borrower’s fiscal quarter following the quarter during which Bank receives and reviews Borrower’s most current fiscal quarter-end financial statements in accordance with any requirements established by Bank for the preparation and delivery thereof.

IN WITNESS WHEREOF, this Addendum has been executed as of the same date as the Note.


STARTEK, INC.
By:	/s/ David G. Durham
	David G. Durham, Chief Financial Officer/Treasurer

By:	/s/ Sylvia A. Church
	Sylvia A. Church, Vice President/Controller

STARTEK USA, INC.
By:	/s/ David G. Durham
		David G. Durham, Chief Financial Officer/Treasurer

By:	/s/ Sylvia A. Church
	Sylvia A. Church, Vice President/Controller

EX-10.25 16 c74453exv10w25.htm EXHIBIT 10.25 Filed by Bowne Pure Compliance

Exhibit 10.25

CONTINUING SECURITY AGREEMENT:
RIGHTS TO PAYMENT

1. GRANT OF SECURITY INTEREST. For valuable consideration, the undersigned STARTEK USA, INC., or any of them (“Debtor”), hereby grants and transfers to WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”) a security interest in all accounts, deposit accounts, chattel paper (whether electronic or tangible), instruments, promissory notes, documents, general intangibles, payment intangibles, software, letter of credit rights, health-care insurance receivables and other rights to payment (collectively called “Collateral”), now existing or at any time hereafter, and prior to the termination hereof, arising (whether they arise from the sale, lease or other disposition of inventory or from performance of contracts for service, manufacture, construction, repair or otherwise or from any other source whatsoever), including all securities, guaranties, warranties, indemnity agreements, insurance policies, supporting obligations and other agreements pertaining to the same or the property described therein, and in all goods returned by or repossessed from Debtor’s customers, together with whatever is receivable or received when any of the Collateral or proceeds thereof are sold, collected, exchanged or otherwise disposed of, whether such disposition is voluntary or involuntary, including without limitation, all rights to payment, including returned premiums, with respect to any insurance relating to any of the foregoing, and all rights to payment with respect to any claim or cause of action affecting or relating to any of the foregoing (hereinafter called “Proceeds”).

2. OBLIGATIONS SECURED. The obligations secured hereby are the payment and performance of: (a) all present and future Indebtedness of Debtor to Bank; (b) all obligations of Debtor and rights of Bank under this Agreement; and (c) all present and future obligations of Debtor to Bank of other kinds. The word “Indebtedness” is used herein in its most comprehensive sense and includes any and all advances, debts, obligations and liabilities of Debtor, or any of them, heretofore, now or hereafter made, incurred or created, whether voluntary or involuntary and however arising, whether due or not due, absolute or contingent, liquidated or unliquidated, determined or undetermined, including under any swap, derivative, foreign exchange, hedge, deposit, treasury management or other similar transaction or arrangement, and whether Debtor may be liable individually or jointly with others, or whether recovery upon such Indebtedness may be or hereafter becomes unenforceable.

3. TERMINATION. This Agreement will terminate upon the performance of all obligations of Debtor to Bank, including without limitation, the payment of all Indebtedness of Debtor to Bank, and the termination of all commitments of Bank to extend credit to Debtor, existing at the time Bank receives written notice from Debtor of the termination of this Agreement.

4. OBLIGATIONS OF BANK. Bank has no obligation to make any loans hereunder. Any money received by Bank in respect of the Collateral may be deposited, at Bank’s option, into a non-interest bearing account over which Debtor shall have no control, and the same shall, for all purposes, be deemed Collateral hereunder.

5. REPRESENTATIONS AND WARRANTIES. Debtor represents and warrants to Bank that: (a) Debtor’s legal name is exactly as set forth on the first page of this Agreement, and all of Debtor’s organizational documents or agreements delivered to Bank are complete and accurate in every respect; (b) Debtor is the owner and has possession or control of the Collateral and Proceeds; (c) Debtor has the exclusive right to grant a security interest in the Collateral and Proceeds; (d) all Collateral and Proceeds are genuine, free from liens, adverse claims, setoffs, default, prepayment, defenses and conditions precedent of any kind or character, except the lien created hereby or as otherwise agreed to by Bank, or as heretofore disclosed by Debtor to Bank, in writing; (e) all statements contained herein and, where applicable, in the Collateral are true and complete in all material respects; (f) no financing statement covering any of the Collateral or Proceeds, and naming any secured party other than Bank, is on file in any public office; (g) all persons appearing to be obligated on Collateral and Proceeds have authority and capacity to contract and are bound as they appear to be; (h) all property subject to chattel paper has been properly registered and filed in compliance with law and to perfect the interest of Debtor in such property; and (i) all Collateral and Proceeds comply with all applicable laws concerning form, content and manner of preparation and execution, including where applicable Federal Reserve Regulation Z and any State consumer credit laws.

6. COVENANTS OF DEBTOR

(a) Debtor agrees in general: (i) to pay Indebtedness secured hereby when due; (ii) to indemnify Bank against all losses, claims, demands, liabilities and expenses of every kind caused by property subject hereto; (iii) to permit Bank to exercise its powers; (iv) to execute and deliver such documents as Bank deems necessary to create, perfect and continue the security interests contemplated hereby; (v) not to change its name, and as applicable, its chief executive office, its principal residence or the jurisdiction in which it is organized and/or registered without giving Bank prior written notice thereof; (vi) not to change the places where Debtor keeps any Collateral or Debtor’s records concerning the Collateral and Proceeds without giving Bank prior written notice of the address to which Debtor is moving same; and (vii) to cooperate with Bank in perfecting all security interests granted herein and in obtaining such agreements from third parties as Bank deems necessary, proper or convenient in connection with the preservation, perfection or enforcement of any of its rights hereunder.

(b) Debtor agrees with regard to the Collateral and Proceeds, unless Bank agrees otherwise in writing: (i) that Bank is authorized to file financing statements in the name of Debtor to perfect Bank’s security interest in Collateral and Proceeds; (ii) where applicable, to insure the Collateral with Bank named as loss payee, in form, substance and amounts, under agreements, against risks and liabilities, and with insurance companies satisfactory to Bank; (iii) not to permit any lien on the Collateral or Proceeds, except in favor of Bank; (iv) not to sell, hypothecate or otherwise dispose of, nor permit the transfer by operation of law of, any of the Collateral or Proceeds or any interest therein; (v) to keep, in accordance with generally accepted accounting principles, complete and accurate records regarding all Collateral and Proceeds, and to permit Bank to inspect the same and make copies thereof at any reasonable time; (vi) if requested by Bank, to receive and use reasonable diligence to collect Proceeds, in trust and as the property of Bank, and to immediately endorse as appropriate and deliver such Proceeds to Bank daily in the exact form in which they are received together with a collection report in form satisfactory to Bank; (vii) not to commingle Collateral or Proceeds, or collections thereunder, with other property; (viii) to give only normal allowances and credits and to advise Bank thereof immediately in writing if they affect any Collateral or Proceeds in any material respect; (ix) on demand, to deliver to Bank returned property resulting from, or payment equal to, such allowances or credits on any Collateral or Proceeds or to execute such documents and to do such other things as Bank may reasonably request for the purpose of perfecting, preserving and enforcing its security interest in such returned property; (x) from time to time, when requested by Bank, to prepare and deliver a schedule of all Collateral and Proceeds subject to this Agreement and to assign in writing and deliver to Bank all accounts, contracts, leases and other chattel paper, instruments, documents and other evidences thereof; (xi) not to allow any financing statement covering any of Debtor’s inventory or proceeds thereof to be on file in any public office without Bank’s prior written consent; (xii) in the event Bank elects to receive payments of Collateral or Proceeds hereunder, to pay all expenses incurred by Bank in connection therewith, including expenses of accounting, correspondence, collection efforts, reporting to account or contract debtors, filing, recording, record keeping and expenses incidental thereto; and (xiii) to provide any service and do any other acts which may be necessary to keep all Collateral and Proceeds free and clear of all defenses, rights of offset and counterclaims.

7. POWERS OF BANK. Debtor appoints Bank its true attorney in fact to perform any of the following powers, which are coupled with an interest, are irrevocable until termination of this Agreement and may be exercised from time to time by Bank’s officers and employees, or any of them, whether or not Debtor is in default: (a) to perform any obligation of Debtor hereunder in Debtor’s name or otherwise; (b) to give notice to account debtors or others of Bank’s rights in the Collateral and Proceeds, to enforce or forebear from enforcing the same and make extension or modification agreements with respect thereto; (c) to release persons liable on Collateral or Proceeds and to give receipts and acquittances and compromise disputes in connection therewith; (d) to release or substitute security; (e) to resort to security in any order; (f) to prepare, execute, file, record or deliver notes, assignments, schedules, designation statements, financing statements, continuation statements, termination statements, statements of assignment, applications for registration or like papers to perfect, preserve or release Bank’s interest in the Collateral and Proceeds; (g) to receive, open and read mail addressed to Debtor; (h) to take cash, instruments for the payment of money and other property to which Bank is entitled; (i) to verify facts concerning the Collateral and Proceeds by inquiry of obligors thereon, or otherwise, in its own name or a fictitious name; (j) to endorse, collect, deliver and receive payment under instruments for the payment of money constituting or relating to Proceeds; (k) to prepare, adjust, execute, deliver and receive payment under insurance claims, and to collect and receive payment of and endorse any instrument in payment of loss or returned premiums or any other insurance refund or return, and to apply such amounts received by Bank, at Bank’s sole option, toward repayment of the Indebtedness; (l) to exercise all rights, powers and remedies which Debtor would have, but for this Agreement, with respect to all Collateral and Proceeds subject hereto; (m) to make withdrawals from and to close deposit accounts or other accounts with any financial institution, wherever located, into which Proceeds may have been deposited, and to apply funds so withdrawn to payment of the Indebtedness; (n) to preserve or release the interest evidenced by chattel paper to which Bank is entitled hereunder and to endorse and deliver any evidence of title incidental thereto; and (o) to do all acts and things and execute all documents in the name of Debtor or otherwise, deemed by Bank as necessary, proper and convenient in connection with the preservation, perfection or enforcement of its rights hereunder.

8. PAYMENT OF PREMIUMS, TAXES, CHARGES, LIENS AND ASSESSMENTS. Debtor agrees to pay, prior to delinquency, all insurance premiums, taxes, charges, liens and assessments against the Collateral and Proceeds, and upon the failure of Debtor to do so, Bank at its option may pay any of them and shall be the sole judge of the legality or validity thereof and the amount necessary to discharge the same. Any such payments made by Bank shall be obligations of Debtor to Bank, due and payable immediately upon demand, together with interest at a rate determined in accordance with the provisions of this Agreement, and shall be secured by the Collateral and Proceeds, subject to all terms and conditions of this Agreement.

9. EVENTS OF DEFAULT. The occurrence of any of the following shall constitute an “Event of Default” under this Agreement: (a) any default in the payment or performance of any obligation, or any defined event of default, under (i) any contract or instrument evidencing any Indebtedness, or (ii) any other agreement between Debtor and Bank, including without limitation any loan agreement, relating to or executed in connection with any Indebtedness; (b) any representation or warranty made by Debtor herein shall prove to be incorrect, false or misleading in any material respect when made; (c) Debtor shall fail to observe or perform any obligation or agreement contained herein; (d) any impairment of the rights of Bank in any Collateral or Proceeds, or any attachment or like levy on any property of Debtor; and (e) Bank, in good faith, believes any or all of the Collateral and/or Proceeds to be in danger of misuse, dissipation, commingling, loss, theft, damage or destruction, or otherwise in jeopardy or unsatisfactory in character or value.

10. REMEDIES. Upon the occurrence of any Event of Default, Bank shall have the right to declare immediately due and payable all or any Indebtedness secured hereby and to terminate any commitments to make loans or otherwise extend credit to Debtor. Bank shall have all other rights, powers, privileges and remedies granted to a secured party upon default under the Colorado Uniform Commercial Code or otherwise provided by law, including without limitation, the right (a) to contact all persons obligated to Debtor on any Collateral or Proceeds and to instruct such persons to deliver all Collateral and/or Proceeds directly to Bank, and (b) to sell, lease, license or otherwise dispose of any or all Collateral. All rights, powers, privileges and remedies of Bank shall be cumulative. No delay, failure or discontinuance of Bank in exercising any right, power, privilege or remedy hereunder shall affect or operate as a waiver of such right, power, privilege or remedy; nor shall any single or partial exercise of any such right, power, privilege or remedy preclude, waive or otherwise affect any other or further exercise thereof or the exercise of any other right, power, privilege or remedy. Any waiver, permit, consent or approval of any kind by Bank of any default hereunder, or any such waiver of any provisions or conditions hereof, must be in writing and shall be effective only to the extent set forth in writing. It is agreed that public or private sales or other dispositions, for cash or on credit, to a wholesaler or retailer or investor, or user of property of the types subject to this Agreement, or public auctions, are all commercially reasonable since differences in the prices generally realized in the different kinds of dispositions are ordinarily offset by the differences in the costs and credit risks of such dispositions. While an Event of Default exists: (a) Debtor will deliver to Bank from time to time, as requested by Bank, current lists of all Collateral and Proceeds; (b) Debtor will not dispose of any Collateral or Proceeds except on terms approved by Bank; and (c) at Bank’s request, Debtor will assemble and deliver all Collateral and Proceeds, and books and records pertaining thereto, to Bank at a reasonably convenient place designated by Bank.

11. DISPOSITION OF COLLATERAL AND PROCEEDS; TRANSFER OF INDEBTEDNESS. In disposing of Collateral hereunder, Bank may disclaim all warranties of title, possession, quiet enjoyment and the like. Any proceeds of any disposition of any of the Collateral or Proceeds, or any part thereof, may be applied by Bank to the payment of expenses incurred by Bank in connection with the foregoing, including reasonable attorneys’ fees, and the balance of such proceeds may be applied by Bank toward the payment of the Indebtedness in such order of application as Bank may from time to time elect. Upon the transfer of all or any part of the Indebtedness, Bank may transfer all or any part of the Collateral or Proceeds and shall be fully discharged thereafter from all liability and responsibility with respect to any of the foregoing so transferred, and the transferee shall be vested with all rights and powers of Bank hereunder with respect to any of the foregoing so transferred; but with respect to any Collateral or Proceeds not so transferred, Bank shall retain all rights, powers, privileges and remedies herein given.

12. STATUTE OF LIMITATIONS. Until all Indebtedness shall have been paid in full and all commitments by Bank to extend credit to Debtor have been terminated, the power of sale or other disposition and all other rights, powers, privileges and remedies granted to Bank hereunder shall continue to exist and may be exercised by Bank at any time and from time to time irrespective of the fact that the Indebtedness or any part thereof may have become barred by any statute of limitations, or that the personal liability of Debtor may have ceased, unless such liability shall have ceased due to the payment in full of all Indebtedness secured hereunder.

13. MISCELLANEOUS. When there is more than one Debtor named herein: (a) the word “Debtor” shall mean all or any one or more of them as the context requires; (b) the obligations of each Debtor hereunder are joint and several; and (c) until all Indebtedness shall have been paid in full, no Debtor shall have any right of subrogation or contribution, and each Debtor hereby waives any benefit of or right to participate in any of the Collateral or Proceeds or any other security now or hereafter held by Bank. Debtor hereby waives any right to require Bank to (i) proceed against Debtor or any other person, (ii) marshal assets or proceed against or exhaust any security from Debtor or any other person, (iii) perform any obligation of Debtor with respect to any Collateral or Proceeds, and (d) make any presentment or demand, or give any notice of nonpayment or nonperformance, protest, notice of protest or notice of dishonor hereunder or in connection with any Collateral or Proceeds. Debtor further waives any right to direct the application of payments or security for any Indebtedness of Debtor or indebtedness of customers of Debtor.

14. NOTICES. All notices, requests and demands required under this Agreement must be in writing, addressed to Bank at the address specified in any other loan documents entered into between Debtor and Bank and to Debtor at the address of its chief executive office (or principal residence, if applicable) specified below or to such other address as any party may designate by written notice to each other party, and shall be deemed to have been given or made as follows: (a) if personally delivered, upon delivery; (b) if sent by mail, upon the earlier of the date of receipt or three (3) days after deposit in the U.S. mail, first class and postage prepaid; and (c) if sent by telecopy, upon receipt.

15. COSTS, EXPENSES AND ATTORNEYS’ FEES. Debtor shall pay to Bank immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys’ fees (to include outside counsel fees and all allocated costs of Bank’s in-house counsel), expended or incurred by Bank in connection with (a) the perfection and preservation of the Collateral or Bank’s interest therein, and (b) the realization, enforcement and exercise of any right, power, privilege or remedy conferred by this Agreement, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Bank or any other person) relating to Debtor or in any way affecting any of the Collateral or Bank’s ability to exercise any of its rights or remedies with respect thereto. All of the foregoing shall be paid by Debtor with interest from the date of demand until paid in full at a rate per annum equal to the greater of ten percent (10%) or Bank’s Prime Rate in effect from time to time.

16. SUCCESSORS; ASSIGNS; AMENDMENT. This Agreement shall be binding upon and inure to the benefit of the heirs, executors, administrators, legal representatives, successors and assigns of the parties, and may be amended or modified only in writing signed by Bank and Debtor.

17. SEVERABILITY OF PROVISIONS. If any provision of this Agreement shall be held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or any remaining provisions of this Agreement.

18. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado.

Debtor warrants that Debtor is an organization registered under the laws of Colorado.

Debtor warrants that its chief executive office (or principal residence, if applicable) is located at the following address: 44 Cook St., Ste 400, Denver, CO 80206.

IN WITNESS WHEREOF, this Agreement has been duly executed as of June 30, 2008.


STARTEK USA, INC.
By:	/s/ David G. Durham
	David G. Durham, Chief Financial Officer/Treasurer

By:	/s/ Sylvia A. Church
	Sylvia A. Church, Vice President/Controller

EX-10.26 17 c74453exv10w26.htm EXHIBIT 10.26 Filed by Bowne Pure Compliance

Exhibit 10.26

CONTINUING SECURITY AGREEMENT:
RIGHTS TO PAYMENT

1. GRANT OF SECURITY INTEREST. For valuable consideration, the undersigned STARTEK, INC., or any of them (“Debtor”), hereby grants and transfers to WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”) a security interest in all accounts, deposit accounts, chattel paper (whether electronic or tangible), instruments, promissory notes, documents, general intangibles, payment intangibles, software, letter of credit rights, health-care insurance receivables and other rights to payment (collectively called “Collateral”), now existing or at any time hereafter, and prior to the termination hereof, arising (whether they arise from the sale, lease or other disposition of inventory or from performance of contracts for service, manufacture, construction, repair or otherwise or from any other source whatsoever), including all securities, guaranties, warranties, indemnity agreements, insurance policies, supporting obligations and other agreements pertaining to the same or the property described therein, and in all goods returned by or repossessed from Debtor’s customers, together with whatever is receivable or received when any of the Collateral or proceeds thereof are sold, collected, exchanged or otherwise disposed of, whether such disposition is voluntary or involuntary, including without limitation, all rights to payment, including returned premiums, with respect to any insurance relating to any of the foregoing, and all rights to payment with respect to any claim or cause of action affecting or relating to any of the foregoing (hereinafter called “Proceeds”).

6. COVENANTS OF DEBTOR

18. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado.

Debtor warrants that Debtor is an organization registered under the laws of Delaware.

Debtor warrants that its chief executive office (or principal residence, if applicable) is located at the following address: 44 Cook St., Ste 400, Denver, CO 80206.

IN WITNESS WHEREOF, this Agreement has been duly executed as of June 30, 2008.


STARTEK, INC.
By:	/s/ David G. Durham
	David G. Durham, Chief Financial Officer/Treasurer

By:	/s/ Sylvia A. Church
	Sylvia A. Church, Vice President/Controller

EX-31.1 18 c74453exv31w1.htm EXHIBIT 31.1 Filed by Bowne Pure Compliance

EXHIBIT 31.1

CERTIFICATIONS

I, A. Laurence Jones, 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

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: August 11, 2008	/s/ A. LAURENCE JONES
	A. Laurence Jones
	President and Chief Executive Officer

EX-31.2 19 c74453exv31w2.htm EXHIBIT 31.2 Filed by Bowne Pure Compliance

EXHIBIT 31.2

CERTIFICATIONS

I, David G. Durham, 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

	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: August 11, 2008	/s/ DAVID G. DURHAM
	David G. Durham
	Executive Vice President, Chief Financial Officer and Treasurer

EX-32.1 20 c74453exv32w1.htm EXHIBIT 32.1 Filed by Bowne Pure Compliance

EXHIBIT 32.1

CERTIFICATIONS

In connection with the Quarterly Report of StarTek, Inc. on Form 10-Q for the quarter ended June 30, 2008, 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 complies 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: August 11, 2008	/s/ A. LAURENCE JONES
	A. Laurence Jones
	President and Chief Executive Officer

Date: August 11, 2008	/s/ DAVID G. DURHAM
	David G. Durham
	Executive Vice President, Chief Financial Officer and Treasurer

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.

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