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                                                                   Exhibit 10.40
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                              SECURITY AGREEMENT

     THIS SECURITY AGREEMENT (this "Agreement") is entered into as of July 25,
                                    ---------
2001, by and between Gene Warren ("Debtor"), and ACT Teleconferencing, Inc., a
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Colorado corporation ("Secured Party").
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                                   Recitals

     A.  Secured Party has accepted a promissory note in the amount of $227,752
(the "Note") as full consideration for a loan to Debtor, pursuant to a
      ----
resolution by the Board of Directors of even date herewith.

     B.  In order to induce Secured Party to accept the Note, Debtor has
executed and delivered a this Security Agreement.

                                   Agreement

     NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Debtor and Secured
Party hereby agree as follows:

         1.  Grant of Security Interest.  Subject to the terms and provisions
             --------------------------
contained herein, Debtor hereby grants to Secured Party a security interest in
all tangible personal property and receivables in which Debtor holds an
ownership interest (the "Collateral").

         2.  Covenants and Agreements of Debtor.  Debtor hereby covenants and
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agrees:

             (a) to promptly pay all taxes and assessments of every nature which
     may be levied or assessed against the Collateral.

             (b) to maintain and preserve ownership of the Collateral.

             (c) to not transfer or attempt to transfer any interest in such
     Collateral.

             (d) from time to time to execute such additional documents and take
     such other action as Secured Party may deem necessary to effectuate,
     maintain and preserve its security interest in the Collateral and the
     perfection of the same and shall indemnify Secured Party from and against
     all reasonable costs and expenses incurred in connection therewith,
     including reasonable attorneys' fees. Without limitation on the generality
     of the foregoing, to the extent any of the Collateral or proceeds therefrom
     constitutes cash or other property for which a security interest under the
     Colorado Uniform Commercial Code may be perfected only by possession, upon
     written request
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from Secured Party, Debtor shall forthwith deliver the same to Secured Party
     upon Debtor's receipt thereof.

          3.  Events of Default.  The following shall constitute "Events of
              -----------------                                   ---------
Default" hereunder, and each such Event of Default shall also constitute an
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Event of Default under the Note, entitling Secured Party to exercise all or any
of the remedies available to Secured Party under the terms of the Note and this
Agreement:

              (a) Any default by Debtor under the Note, including the failure by
     Debtor to pay any sum when due and payable under the Note; or

              (b) The failure of Debtor to perform or observe, or other breach
     of, any other covenant, obligation, agreement, condition, prohibition,
     representation, warranty or any other term or provision hereunder.

          4.  Cure by Secured Party.  Debtor agrees that Secured Party shall
              ---------------------
have the right, but not the obligation, to take any action reasonably necessary
to maintain, protect and preserve the Collateral.  The amount due under the Note
shall be increased by any amounts so paid by Secured Party.  Payment or action
by the Secured Party under this Section 4 shall not be deemed to cure any
default by Debtor under the Note or this Agreement.

          5.  Secured Party's Right Upon an Event of Default.
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              (a) Upon the occurrence of an Event of Default hereunder, Secured
     Party shall have all of the remedies of a secured party under the Uniform
     Commercial Code as enacted by the State of Colorado and then in effect.
     Without limiting the foregoing, Secured Party shall be entitled to recover
     all of its costs and expenses incurred in enforcing its rights hereunder
     and under the Note, including reasonable attorneys' fees and costs.

              (b) For any Collateral which constitutes proceeds resulting from
     liquidated proceeds or sums of any nature, Secured Party may, without being
     obligated to sell or attempt to sell any Collateral, giving rise to the
     proceeds or sums, collect such proceeds or sums from the Debtor and apply
     the same in reduction of the indebtedness secured hereby in such order and
     manner as Secured Party shall determine in its discretion.  Debtor hereby
     authorizes any such account debtor or obligor to perform for Secured Party
     upon receiving notice from Secured Party that it is entitled to such
     performance, regardless of any dispute between Debtor and Secured Party
     concerning the existence of the requisite Event of Default or any other
     matter, and the Debtor hereby releases any such debtor or obligor from any
     liability for so performing.  In connection therewith, such indebtedness
     shall be reduced only to the extent that such liquidated sums are actually
     received and actually applied by Secure Party as aforesaid.

              (c) The rights and remedies of Secured Party hereunder are
     cumulative and are not in lieu of, but are in addition to, any other rights
     or remedies which Secured Party may have under the Note, at law or in
     equity.

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          6.  Further Assurances.  Debtor hereby agrees to execute such other
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documents and perform such other acts as may be deemed necessary or appropriate
by Secured Party to perfect, protect or enforce the rights hereunder.

          7.  Binding Effect.  The provisions of this Agreement shall be binding
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upon and shall inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors and permitted assigns.

          8.  Amendment.  This Agreement may not be amended, modified, or
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changed, nor shall any waiver of any provision hereof be effective, except only
by an instrument in writing and signed by the party against whom enforcement of
any waiver, amendment, change, modification, or discharge is sought.

          9.  Notices.  All notices permitted under this Agreement shall be in
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writing signed by the party giving same and shall be deemed effective upon
personal delivery or telefacsimile transmission or three days after mailing by
certified or registered mail, postage prepaid, as follows:


     If to Debtor:

          Gene Warren
          1658 Cole Boulevard, Suite 130
          Golden, Colorado 80401
          Telephone: (303) 235-6777
          Facsimile: (303) 233-0895



     If to Secured Party:

          ACT Teleconferencing, Inc.
          Attn: Gavin J. Thomson
          1658 Cole Boulevard, Suite 130
          Golden, Colorado 80401
          Telephone: (303) 235-9000
          Facsimile: (303) 233-0895



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

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

                                DEBTOR:



                                _______________________________________________
                                             Gene Warren



                                SECURED PARTY:

                                ACT TELECONFERENCING, a Colorado corporation



                                By: ___________________________________________
                                    Gavin J. Thomson, Chief Financial Officer

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