Document:

EXHIBIT 10.4

 

BUSINESS LOAN AGREEMENT

 

	
  Principal

  	
   

  	
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  Date

  	
   

  	
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  No

  	
   

  	
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  $15,000,000.00

  	
   

  	
  06-26-2009

  	
   

  	
  08-01-2010

  	
   

  	
   

  	
   

  	
  4A0 / 9215

  	
   

  	
   

  	
   

  	
  PMF01

  	
   

  	
   

  

 

References in the boxes above are for Lender’s use only and do not limit
the applicability of this document to any particular loan or item.

 

Any item above containing “***” has been omitted due to text length
limitations.

 

	
  Borrower:

  	
   

  	
  STARTEK,
  INC.

  STARTEK USA, INC.

  STARTEK CANADA SERVICES, LTD.

  44 COOK ST., SUITE 400

  DENVER, CO 80206

  	
   

  	
  Lender:

  	
   

  	
  UMB BANK
  COLORADO, n.a.

  DOWNTOWN DENVER BANKING CENTER

  1670 BROADWAY

  DENVER, CO 80202-4838

  (303) 839-1300

  

 

THIS
BUSINESS LOAN AGREEMENT dated June 26, 2009, is made and executed between
STARTEK, INC.; STARTEK USA, INC. and STARTEK CANADA SERVICES, LTD. (“Borrower”)
and UMB BANK COLORADO, n.a.  (“Lender”)
on the following terms and conditions. 
Borrower has received prior commercial loans from Lender or has applied
to Lender for a commercial loan or loans or other financial accommodations,
including those which may be described on any exhibit or schedule attached to
this Agreement.  Borrower understands and
agrees that:  (A)  in granting,
renewing, or extending any Loan, Lender is relying upon Borrower’s
representations, warranties, and agreements as set forth in this
Agreement;  (B)  the granting,
renewing, or extending of any Loan by Lender at all times shall be subject to
Lender’s sole judgment and discretion; and 
(C)  all such Loans shall be and remain subject to the terms and
conditions of this Agreement.

 

TERM.  This Agreement shall be effective as of June 26,
2009, and shall continue in full force and effect until such time as all of
Borrower’s Loans in favor of Lender have been paid in full, including
principal, interest, costs, expenses, attorneys’ fees, and other fees and
charges, or until such time as the parties may agree in writing to terminate
this Agreement.

 

LINE OF
CREDIT.  Lender agrees to make Advances
to Borrower and issue Letters of Credit at Borrower’s request from time to time
from the date of this Agreement to the Expiration Date, provided the aggregate
amount of such Advances outstanding plus Letter of Credit Outstandings at any
time does not exceed the Borrowing Base. 
Within the foregoing limits, Borrower may borrow, partially or wholly
prepay, and reborrow under this Agreement as follows:

 

Conditions Precedent to Each Advance/Letter of Credit.  Lender’s obligation to make any Advance to or
for the account of Borrower under this Agreement is subject to the following
conditions precedent, with all documents, instruments, opinions, reports, and
other items required under this Agreement to be in form and substance
satisfactory to Lender:

 

(1) 
Lender shall have received evidence that this Agreement and all Related
Documents have been duly authorized, executed, and delivered by Borrower to
Lender.

 

(2) 
Lender shall have received such documents as Lender may request.

 

(3) 
The security interests in the Collateral shall have been duly authorized,
created, and perfected with first lien priority and shall be in full force and
effect.

 

(4) Lender,
at its option and for its sole benefit, shall have conducted an audit of
Borrower’s Accounts, books, records, and operations, and Lender shall be
satisfied as to their condition.

 

(5) 
Borrower shall have paid to Lender all fees, costs, and expenses specified in
this Agreement and the Related Documents as are then due and payable.

 

(6) 
There shall not exist at the time of any Advance or the issuance of any Letter
of Credit a condition which would constitute an Event of Default under this
Agreement, and Borrower shall have delivered to Lender the compliance
certificate called for in the paragraph below titled “Compliance Certificate.”

 

(7) 
Any Letter of Credit must expire no later than the business day immediately
preceding the Maturity Date.

 

Making Loan Advances.  Advances under this credit facility, as well
as directions for payment from Borrower’s accounts, may be requested orally or
in writing by authorized persons.  Lender
may, but need not, require that all oral requests be confirmed in writing.  Each Advance shall be conclusively deemed to
have been made at the request of and for the benefit of Borrower (1)  when
credited to any deposit account of Borrower maintained with Lender or (2) 
when advanced in accordance with the instructions of an authorized person.  Lender, at its option, may set a cutoff time,
after which all requests for Advances will be treated as having been requested
on the next succeeding Business Day.

 

Issuance of Letters of Credit.  Letters of Credit may be
issued from time to time hereunder upon Borrower’s delivery to Lender of an
application therefor in form and substance acceptable to Lender in its sole
discretion no later than seven (7) days prior to the date on which
Borrower requests the issuance of a letter of Credit.

 

Mandatory Loan Repayments.  If at any time the aggregate principal amount
of the outstanding Advances and the Letter of Credit Outstandings shall exceed
the applicable Borrowing Base, Borrower, immediately upon written or oral
notice from Lender, shall pay to Lender an amount equal to the difference
between (i) the aggregate outstanding principal balance of the Advances
and the Letter of Credit Outstandings and (ii) the Borrowing Base.  On the Expiration Date, Borrower shall pay to
Lender in full the aggregate unpaid principal amount of all Advances and Letter
of Credit Outstandings then outstanding and all accrued unpaid interest, together
with all other applicable fees, costs and charges, if any, not yet paid.  Borrower further agrees to immediately pay
Lender in immediately available funds for any payment or disbursement made by
Lender under any Letter of Credit which has been issued for Borrower’s account.

 

Loan Account.  Lender shall maintain on its books a record
of account in which Lender shall make entries for each Advance and such other
debits and credits as shall be appropriate in connection with the credit
facility.  Lender shall provide Borrower
with periodic statements of Borrower’s account, which statements shall be
considered to be correct and conclusively binding on Borrower unless Borrower
notifies Lender to the contrary within thirty (30) days after Borrower’s
receipt of any such statement which Borrower deems to be incorrect.

 

COLLATERAL.  To secure payment of the Primary Credit
Facility and performance of all other Loans, obligations and duties owed by
Borrower to Lender, Borrower (and others, if required) shall grant to Lender
Security Interests in such property and assets as Lender may require.  Lender’s Security Interests in the Collateral
shall be continuing liens and shall include the proceeds and products of the
Collateral, including without limitation the proceeds of any insurance.  With respect to the Collateral, Borrower
agrees and represents and warrants to Lender:

 

Perfection of Security Interests.  Borrower agrees to execute all documents
perfecting Lender’s Security Interest and to take whatever actions are
requested by Lender to perfect and continue Lender’s Security Interests in the
Collateral.  Upon request of Lender,
Borrower will deliver to Lender any and all of the documents evidencing or
constituting the Collateral, and Borrower will note Lender’s interest upon any
and all chattel paper and instruments if not delivered to Lender for possession
by Lender.  Contemporaneous with the
execution of this Agreement, Borrower will execute one or more UCC financing
statements and any similar statements as may be required by applicable law, and
Lender will file such financing statements and all such similar statements in
the appropriate location or locations. 
Borrower hereby appoints Lender as its irrevocable attorney-in-fact for
the purpose of executing any documents necessary to perfect or to continue any
Security Interest.  Lender may at any
time, and without further authorization from Borrower, file a carbon,
photograph, facsimile, or other reproduction of any financing statement for use
as a financing statement.  Borrower will
reimburse Lender for all expenses for the perfection, termination, and the
continuation of the perfection of Lender’s security interest in the
Collateral.  Borrower promptly will
notify Lender before any change in Borrower’s name including any change to the
assumed business names of Borrower. 
Borrower also promptly will notify Lender before any change in Borrower’s
Social Security Number or Employer Identification Number.  Borrower further agrees to notify Lender in
writing prior to any change in address or location of Borrower’s principal
governance office or should Borrower merge or consolidate with any other
entity.

 

Collateral Records.  Borrower does now, and at all times hereafter
shall, keep correct and accurate records of the Collateral, all of which
records shall be

 

 

available
to Lender or Lender’s representative upon demand for inspection and copying at
any reasonable time.  With respect to the
Accounts, Borrower agrees to keep and maintain such records as Lender may
require, including without limitation information concerning Eligible Accounts
and Account balances and agings.  Records
related to Accounts (Receivables) are or will be located at above business
address.  The above is an accurate and
complete list of all locations at which Borrower keeps or maintains business
records concerning Borrower’s collateral.

 

Collateral Schedules.  Concurrently with the execution and delivery
of this Agreement, Borrower shall execute and deliver to Lender schedules of
Accounts and schedules of Eligible Accounts in form and substance satisfactory
to the Lender.  Thereafter supplemental
schedules shall be delivered according to the following schedule:  With respect to Eligible Accounts, schedules
shall be delivered within 30 days after each Month.

 

Representations and Warranties Concerning Accounts.  With respect to the Accounts, Borrower
represents and warrants to Lender:  (1) 
Each Account represented by Borrower to be an Eligible Account for purposes of
this Agreement conforms to the requirements of the definition of an Eligible
Account;  (2)  All Account
information listed on schedules delivered to Lender will be true and correct,
subject to immaterial variance; and  (3) 
Lender, its assigns, or agents shall have the right at any time following
reasonable advance notice and at Borrower’s expense to inspect, examine, and
audit Borrower’s records and to confirm with Account Debtors the accuracy of
such Accounts.

 

CONDITIONS
PRECEDENT TO EACH ADVANCE.  Lender’s obligation to make the initial
Advance and each subsequent Advance under this Agreement shall be subject to
the fulfillment to Lender’s satisfaction of all of the conditions set forth in
this Agreement and in the Related Documents.

 

Loan Documents.  Borrower shall provide to Lender the
following documents for the Loan:  (1) 
the Note;  (2)  Security Agreements
granting to Lender security interests in the Collateral;  (3)  financing statements and all other
documents perfecting Lender’s Security Interests;  (4)  evidence of insurance as required
below;  (5)  together with all such
Related Documents as Lender may require for the Loan; all in form and substance
satisfactory to Lender and Lender’s counsel.

 

Borrower’s Authorization.  Borrower shall have provided in form and
substance satisfactory to Lender properly certified resolutions, duly
authorizing the execution and delivery of this Agreement, the Note and the
Related Documents.  In addition, Borrower
shall have provided such other resolutions, authorizations, documents and
instruments as Lender or its counsel, may require.

 

Fees and Expenses Under This Agreement.  Borrower shall have paid to Lender all fees,
costs, and expenses specified in this Agreement and the Related Documents as
are then due and payable.

 

Representations and Warranties.  The representations and warranties set forth
in this Agreement, in the Related Documents, and in any document or certificate
delivered to Lender under this Agreement are true and correct in all material
respects.

 

No Event of Default.  There shall not exist at the time of any
Advance a condition which would constitute an Event of Default under this
Agreement or under any Related Document.

 

MULTIPLE
BORROWERS.  This
Agreement has been executed by multiple obligors who are referred to in this
Agreement individually, collectively and interchangeably as “Borrower.”  Unless specifically stated to the contrary,
the word “Borrower” as used in this Agreement, including without limitation all
representations, warranties and covenants, shall include all Borrowers.  Borrower understands and agrees that, with or
without notice to any one Borrower, Lender may 
(A)  make one or more additional secured or unsecured loans or
otherwise extend additional credit with respect to any other Borrower;  (B)  with respect to any other Borrower
alter, compromise, renew, extend, accelerate, or otherwise change one or more
times the time for payment or other terms of any indebtedness, including
increases and decreases of the rate of interest on the indebtedness;  (C)  exchange, enforce, waive,
subordinate, fail or decide not to perfect, and release any security, with or
without the substitution of new collateral; 
(D)  release, substitute, agree not to sue, or deal with any one or
more of Borrower’s or any other Borrower’s sureties, endorsers, or other
guarantors on any terms or in any manner Lender may choose;  (E)  determine how, when and what
application of payments and credits shall be made on any indebtedness;  (F)  apply such security and direct the
order or manner of sale of any Collateral, including without limitation, any
non-judicial sale permitted by the terms of the controlling security agreement
or deed of trust, as Lender in its discretion may determine;  (G)  sell, transfer, assign or grant
participations in all or any part of the Loan; 
(H)  exercise or refrain from exercising any rights against
Borrower or others, or otherwise act or refrain from acting;  (I)  settle or compromise any
indebtedness; and  (J)  subordinate
the payment of all or any part of any of Borrower’s indebtedness to Lender to
the payment of any liabilities which may be due Lender or others.

 

REPRESENTATIONS
AND WARRANTIES.  Borrower
represents and warrants to Lender, as of the date of this Agreement, as of the
date of each disbursement of loan proceeds, as of the date of any renewal,
extension or modification of any Loan, and at all times any Indebtedness
exists:

 

Organization.  STARTEK, INC. is a corporation for profit
which is, and at all times shall be, duly organized, validly existing, and in
good standing under and by virtue of the laws of the State of Delaware.  STARTEK, INC. is duly authorized to transact
business in all other states in which STARTEK, INC. is doing business, having
obtained all necessary filings, governmental licenses and approvals for each
state in which STARTEK, INC. is doing business except where the failure to do
so would not have a material adverse effect on its business or financial
condition.  Specifically, STARTEK, INC..
is, and at all times shall be, duly qualified as a foreign corporation in all
states in which the failure to so qualify would have a material adverse effect
on its business or financial condition. 
STARTEK, INC. has the full power and authority to own its properties and
to transact the business in which it is presently engaged or presently proposes
to engage.  STARTEK, INC. maintains an
office at 44 COOK ST., SUITE 400, DENVER, CO 
80206.  Unless STARTEK, INC. has
designated otherwise in writing, the principal office is the office at which
STARTEK, INC. keeps its books and records including its records concerning the
Collateral.  STARTEK, INC. will notify
Lender prior to any change in the location of STARTEK, INC.’s state of
organization or any change in STARTEK, INC.’s name.  STARTEK, INC. shall do all things necessary
to preserve and to keep in full force and effect its existence, rights and
privileges, and shall comply in all material respects with all regulations,
rules, ordinances, statutes, orders and decrees of any governmental or
quasi-governmental authority or court applicable to STARTEK, INC. and STARTEK,
INC.’s business activities.

 

STARTEK
USA, INC. is a corporation for profit which is, and at all times shall be, duly
organized, validly existing, and in good standing under and by virtue of the
laws of the State of Colorado.  STARTEK
USA, INC. is duly authorized to transact business in all other states in which
STARTEK USA, INC. is doing business, having obtained all necessary filings,
governmental licenses and approvals for each state in which STARTEK USA, INC.
is doing business except where the failure to do so would not have a material
adverse effect on its business or financial condition.  Specifically, STARTEK USA, INC. is, and at
all times shall be, duly qualified as a foreign corporation in all states in
which the failure to so qualify would have a material adverse effect on its
business or financial condition.  STARTEK
USA, INC. has the full power and authority to own its properties and to
transact the business in which it is presently engaged or presently proposes to
engage.  STARTEK USA, INC. maintains an
office at 44 COOK ST., 4TH FLOOR, DENVER, CO 
80206.  Unless STARTEK USA, INC.
has designated otherwise in writing, the principal office is the office at which
STARTEK USA, INC. keeps its books and records including its records concerning
the Collateral.  STARTEK USA, INC. will
notify Lender prior to any change in the location of STARTEK USA, INC.’s state
of organization or any change in STARTEK USA, INC.’s name.  STARTEK USA, INC. shall do all things
necessary to preserve and to keep in full force and effect its existence,
rights and privileges, and shall comply in all material respects  with all regulations, rules, ordinances,
statutes, orders and decrees of any governmental or quasi-governmental authority
or court applicable to STARTEK USA, INC. and STARTEK USA, INC.’s business
activities.

 

STARTEK
CANADA SERVICES, LTD. is a limited company for profit which is, and at all
times shall be, duly organized, validly existing, and in good standing under
and by virtue of the laws of the Province of Nova Scotia.  STARTEK CANADA SERVICES, LTD. is duly
authorized to transact business in all other provinces or jurisdictions in
which STARTEK CANADA SERVICES, LTD. is doing business, having obtained all
necessary filings, governmental licenses and approvals for each province or
jurisdiction in which STARTEK CANADA SERVICES, LTD. is doing business except
where the failure to do so would not have a material adverse effect on its
business or financial condition.  Specifically,
STARTEK CANADA SERVICES, LTD. is, and at all times shall be, duly qualified as
a foreign corporation in all provinces and jurisdictions in which the failure
to so qualify would have a material adverse effect on its business or financial
condition.  STARTEK CANADA SERVICES, LTD.
has the full power and authority to own its properties and to transact the
business in which it is presently engaged or presently proposes to engage.  STARTEK CANADA SERVICES, LTD. maintains an
office at 44 COOK ST., SUITE 400, DENVER, CO 
80206.  Unless STARTEK CANADA
SERVICES, LTD. has designated otherwise in writing, the principal office is the
office at which STARTEK CANADA SERVICES, LTD. keeps its books and records
including its records concerning the Collateral.  STARTEK CANADA SERVICES, LTD. will notify Lender
prior to any change in the location of STARTEK CANADA SERVICES, LTD.’s province
of organization or any change in STARTEK CANADA SERVICES, LTD.’s name.  STARTEK CANADA SERVICES, LTD. shall do all
things necessary to preserve and to keep in full force and effect its
existence, rights and privileges, and shall comply in all material respects
with all regulations, rules, ordinances, statutes, orders and decrees of any
governmental or quasi-governmental authority or court applicable to STARTEK
CANADA SERVICES, LTD. and STARTEK CANADA SERVICES, LTD.’s business activities.

 

Assumed Business Names.  Borrower has filed or recorded all documents
or filings required by law relating to all assumed business names used by
Borrower.  Excluding the name of
Borrower, the following is a complete list of all assumed business names under
which Borrower does business:  None.

 

Authorization.  Borrower’s execution, delivery, and
performance of this Agreement and all the Related Documents have been duly
authorized by all necessary action by Borrower and do not conflict with, result
in a violation of, or constitute a default under  (1)  any provision of  (a)  Borrower’s articles of 

 

 

incorporation
or organization, or bylaws, or  (b) 
any agreement or other instrument binding upon Borrower or  (2)  any law, governmental regulation,
court decree, or order applicable to Borrower or to Borrower’s properties
except with respect to any violations or defaults which would not result in a
material adverse effect on Borrower’s properties, business or financial
condition.

 

Financial Information.  Each of Borrower’s financial statements
supplied to Lender present fairly in all material respects Borrower’s financial
condition as of the date of the statement, and there has been no material adverse
change in Borrower’s financial condition subsequent to the date of the most
recent financial statement supplied to Lender. 
Borrower has no material contingent obligations except as disclosed in
such financial statements.

 

Legal Effect.  This Agreement constitutes, and any
instrument or agreement Borrower is required to give under this Agreement when
delivered will constitute legal, valid, and binding obligations of Borrower
enforceable against Borrower in accordance with their respective terms.

 

Properties.  Except as contemplated by this Agreement or
as previously disclosed in Borrower’s financial statements or in writing to
Lender and as accepted by Lender, and except for property tax liens for taxes
not presently due and payable, Borrower owns and has good title to all of
Borrower’s owned properties free and clear of all Security Interests, and has
not executed any security documents or financing statements relating to such
properties.  All of Borrower’s properties
are titled in Borrower’s legal name, and Borrower has not used or filed a
financing statement under any other name for at least the last five (5) years.

 

Hazardous Substances.  Except as disclosed to and acknowledged by
Lender in writing, Borrower represents and warrants that to its knowledge:  (1) During the period of Borrower’s
ownership of the Collateral, there has been no use, generation, manufacture,
storage, treatment, disposal, release or threatened release of any Hazardous
Substance by any person on, under, about or from any of the Collateral.  (2)  Borrower has no knowledge of, or
reason to believe that there has been  (a) 
any breach or violation of any Environmental Laws;  (b)  any use, generation, manufacture,
storage, treatment, disposal, release or threatened release of any Hazardous
Substance on, under, about or from the Collateral by any prior owners or
occupants of any of the Collateral; or  (c) 
any actual or threatened litigation or claims of any kind by any person
relating to such matters.  (3) 
Neither Borrower nor any tenant, contractor, agent or other authorized user of
any of the Collateral shall use, generate, manufacture, store, treat, dispose
of or release any Hazardous Substance on, under, about or from any of the
Collateral; and any such activity shall be conducted in material compliance
with all applicable federal, state, and local laws, regulations, and
ordinances, including without limitation all Environmental Laws.  Borrower authorizes Lender and its agents to
enter upon the Collateral to make such inspections and tests as Lender may deem
appropriate to determine compliance of the Collateral with this section of the
Agreement.  Any inspections or tests made
by Lender shall be at Borrower’s expense and for Lender’s purposes only and
shall not be construed to create any responsibility or liability on the part of
Lender to Borrower or to any other person. 
The representations and warranties contained herein are based on
Borrower’s due diligence in investigating the Collateral for hazardous waste
and Hazardous Substances.  Borrower
hereby  (1)  releases and waives any
future claims against Lender for indemnity or contribution in the event
Borrower becomes liable for cleanup or other costs under any such laws,
and  (2)  agrees to indemnify,
defend, and hold harmless Lender against any and all claims, losses,
liabilities, damages, penalties, and expenses which Lender may directly or
indirectly sustain or suffer resulting from a breach of this section of the
Agreement or as a consequence of any use, generation, manufacture, storage,
disposal, release or threatened release of a hazardous waste or substance on
the Collateral.  The provisions of this
section of the Agreement, including the obligation to indemnify and defend,
shall survive the payment of the Indebtedness and the termination, expiration
or satisfaction of this Agreement and shall not be affected by Lender’s
acquisition of any interest in any of the Collateral, whether by foreclosure or
otherwise.

 

Litigation and Claims.  No material litigation, claim, investigation,
administrative proceeding or similar action (including those for unpaid taxes)
against Borrower is pending or to its knowledge threatened, and no other event
has occurred which may materially adversely affect Borrower’s financial
condition or properties, other than litigation, claims, or other events, if
any, that have been disclosed to and acknowledged by Lender in writing.

 

Taxes.  To the
best of Borrower’s knowledge, all of Borrower’s tax returns and reports that
are or were required to be filed, have been filed, and all taxes, assessments
and other governmental charges have been paid in full, except those presently
being or to be contested by Borrower in good faith in the ordinary course of
business and for which adequate reserves have been provided.

 

Lien Priority.  Unless otherwise previously disclosed to
Lender in writing, Borrower has not entered into or granted any Security
Agreements, or permitted the filing or attachment of any Security Interests on
or affecting any of the Collateral directly or indirectly securing repayment of
Borrower’s Loan and Note, that would be prior or that may in any way be
superior to Lender’s Security Interests and rights in and to such Collateral.

 

Binding Effect.  This Agreement, the Note, all Security
Agreements (if any), and all Related Documents are binding upon the signers
thereof, as well as upon their successors, representatives and assigns, and are
legally enforceable in accordance with their respective terms.

 

AFFIRMATIVE
COVENANTS.  Borrower
covenants and agrees with Lender that, so long as this Agreement remains in
effect, Borrower will:

 

Notices of Claims and Litigation.  Promptly inform Lender in writing of  (1)  all material adverse changes in
Borrower’s financial condition, and  (2) 
all existing and all threatened litigation, claims, investigations,
administrative proceedings or similar actions affecting Borrower or any
Guarantor which could materially affect the financial condition of Borrower or
the financial condition of any Guarantor.

 

Financial Records.  Maintain its books and records in accordance
with GAAP, applied on a consistent basis, and permit Lender to examine and
audit Borrower’s books and records at all reasonable times.

 

Financial Statements.  Furnish Lender with the following:

 

Annual Statements.  As soon as available, but in no event later
than ninety (90) days after the end of each fiscal year, Borrower’s balance
sheet and income statement for the year ended, audited by a certified public
accountant satisfactory to Lender.

 

Interim Statements.  As soon as available, but in no event later
than forty-five (45) days after the end of each month, Borrower’s balance sheet
and profit and loss statement for the period ended, prepared by Borrower.

 

All
financial reports required to be provided under this Agreement shall be
prepared in accordance with GAAP, applied on a consistent basis, and certified
by Borrower as being true and correct.

 

Additional Information.  Furnish such additional information and
statements, as Lender may reasonably request from time to time.

 

Additional Requirements.  RATIO OF TOTAL LIABILITIES TO TANGIBLE NET
WORTH.  At all times while any Loans
are outstanding or made available under the Note hereunder and until all Loans
of the Borrower hereunder are paid in full, this ratio will never exceed 1.0 to
1.0.  This is calculated as follows:  [Total Liabilities] divided by [Tangible Net
Worth].

 

TANGIBLE
NET WORTH.  At all times
while any Loans are outstanding or made available under the Note hereunder and
until all Loans to the Borrower hereunder are paid in full, the Borrower will
maintain a Tangible Net Worth, of not less than $105,000,000.00. Tangible Net
Worth is defined as Book Net Worth minus any and all intangibles, including
goodwill.

 

LIQUIDITY
REQUIREMENT. Maintain unencumbered liquid assets of
$10,000,000.00, measured on the last day of each fiscal quarter.  Liquid assets are defined as cash,
certificate of deposits, and marketable securities.

 

CASH
FLOW COVERAGE RATIO.  At all times
while any Loans are outstanding or made available under the Note hereunder and
until all Loans of the Borrower hereunder are paid in full, the Borrower will
maintain a Cash Flow Coverage ratio measured on the last day each fiscal
quarter for the twelve month period then ending, of not less than 1.50 to
1.00.  This ratio is calculated as
follows:  [Net Income, minus dividends,
plus depreciation, plus interest expense, plus impairment and restructuring
expense (never to exceed $15,434,000) minus one time gain on the sale of
assets] divided by [interest expense plus current portion of long term debt].

 

Insurance.  Maintain fire and other risk insurance,
public liability insurance, and such other insurance as Lender may reasonably
require with respect to Borrower’s properties and operations, in form, amounts,
coverages and with insurance companies reasonably acceptable to Lender.  Borrower, upon request of Lender, will
deliver to Lender from time to time the policies or certificates of insurance
in form satisfactory to Lender, including stipulations that coverages will not
be cancelled or diminished without at least thirty (30) days prior written
notice to Lender.  Each insurance policy
also shall include an endorsement providing that coverage in favor of Lender
will not be impaired in any way by any act, omission or default of Borrower or
any other person.  In connection with all
policies covering assets in which Lender holds or is offered a security
interest for the Loans, Borrower will provide Lender with such lender’s loss
payable or other endorsements as Lender may require.

 

Insurance Reports.  Furnish to Lender, upon request of Lender,
reports on each existing insurance policy showing such information as Lender
may reasonably request, including without limitation the following:  (1)  the name of the insurer;  (2)  the risks insured;  (3)  the amount of the policy;  (4)  the properties insured;  (5)  the then current property values on
the basis of which insurance has been obtained, and the manner of determining
those values; and  (6)  the expiration
date of the policy.

 

Other Agreements.  Comply in all material respects with all
terms and conditions of all other material agreements, whether now or hereafter
existing,

 

 

between
Borrower and any other party and notify Lender immediately in writing of any
material default in connection with any other such material agreements.

 

Loan Fees, Charges and Expenses.  In addition to all other agreed upon fees,
charges, and expenses, pay the following:  UNUSED
FEE.   Borrower shall pay to Lender a
fee equal to 25 basis points per annum multiplied by the average daily amount
by which the Revolving Credit Maximum Amount exceeds the sum of the outstanding
principal balance of the Revolving Credit Loans.  The Commitment Fee shall be payable quarterly
in arrears on September 30, 2009 and on the last day of each quarter
thereafter.

 

Loan Proceeds.  Use all Loan proceeds solely for Borrower’s
business operations and, provided that Borrower is in compliance with the
financial covenants in this Agreement, for the purchase of call centers, unless
specifically consented to the contrary by Lender in writing.

 

Taxes, Charges and Liens.  Pay and discharge when due all of its
indebtedness and obligations, including without limitation all assessments,
taxes, governmental charges, levies and liens, of every kind and nature,
imposed upon Borrower or its properties, income, or profits, prior to the date
on which penalties would attach, and all lawful claims that, if unpaid, might
become a lien or charge upon any of Borrower’s properties, income, or
profits.  Provided however, Borrower will
not be required to pay and discharge any such assessment, tax, charge, levy,
lien or claim so long as  (1)  the
legality of the same shall be contested in good faith by appropriate
proceedings, and  (2)  Borrower
shall have established on Borrower’s books adequate reserves with respect to
such contested assessment, tax, charge, levy, lien, or claim in accordance with
GAAP.

 

Performance.  Perform and comply, in a timely manner, with
all terms, conditions, and provisions set forth in this Agreement, in the
Related Documents, and in all other instruments and agreements between Borrower
and Lender.  Borrower shall notify Lender
immediately in writing of any material default in connection with any
agreement.

 

Operations.  Maintain executive and management personnel
with substantially the same qualifications and experience as the present
executive and management personnel; conduct its business affairs in a
reasonable and prudent manner.

 

Environmental Studies.  Promptly conduct and complete, at Borrower’s
expense, all such investigations, studies, samplings and testings as may be
reasonably requested by Lender or any governmental authority relative to any
substance, or any waste or by-product of any substance defined as toxic or a
hazardous substance under applicable federal, state, or local law, rule,
regulation, order or directive, at or affecting any property or any facility owned,
leased or used by Borrower.

 

Compliance with Governmental Requirements.  Comply in all material respects with all
laws, ordinances, and regulations, now or hereafter in effect, of all
governmental authorities applicable from time to time to the conduct of
Borrower’s properties, businesses and operations, and to the use or occupancy
of the Collateral, including without limitation, the Americans With
Disabilities Act.  Borrower may contest
in good faith any such law, ordinance, or regulation and withhold compliance
during any proceeding, including appropriate appeals, so long as Borrower has
notified Lender in writing prior to doing so and so long as, in Lender’s sole
opinion, Lender’s interests in the Collateral are not jeopardized.  In such event, Lender may require Borrower to
post adequate security or a surety bond, reasonably satisfactory to Lender, to
protect Lender’s interest.

 

Inspection.  Permit employees or agents of Lender at any
reasonable time to inspect any and all Collateral for the Loan or Loans and
Borrower’s other properties and to examine or audit Borrower’s books, accounts,
and records and to make copies and memoranda of Borrower’s books, accounts, and
records.  If Borrower now or at any time
hereafter maintains any records (including without limitation computer
generated records and computer software programs for the generation of such
records) in the possession of a third party, Borrower, upon request of Lender,
shall notify such party to permit Lender free access to such records at all reasonable
times and to provide Lender with copies of any records it may request, all at
Borrower’s expense.

 

Compliance Certificates.  Unless waived in writing by Lender, provide
Lender within forty-five (45) days after the end of each fiscal quarter, with a
certificate executed by Borrower’s chief financial officer, or other officer or
person acceptable to Lender, certifying that the representations and warranties
set forth in this Agreement are true and correct in all material respects as of
the date of the certificate and further certifying that, as of the date of the
certificate, no Event of Default exists under this Agreement.

 

Environmental Compliance and Reports.  Borrower shall comply in all material
respects with any and all Environmental Laws; not cause or permit to exist, as
a result of an intentional or unintentional action or omission on Borrower’s
part or on the part of any third party, on property owned and/or occupied by
Borrower, any environmental activity where damage may result to the environment,
unless such environmental activity is pursuant to and in compliance with the
conditions of a permit issued by the appropriate federal, state or local
governmental authorities; shall furnish to Lender promptly and in any event
within thirty (30) days after receipt thereof a copy of any notice, summons,
lien, citation, directive, letter or other communication from any governmental
agency or instrumentality concerning any intentional or unintentional action or
omission on Borrower’s part in connection with any environmental activity
whether or not there is damage to the environment and/or other natural
resources.

 

Additional Assurances.  Make, execute and deliver to Lender such
promissory notes, mortgages, deeds of trust, security agreements, assignments,
financing statements, instruments, documents and other agreements as Lender or
its attorneys may reasonably request to evidence and secure the Loans and to
perfect all Security Interests.

 

LENDER’S
EXPENDITURES.  If any action
or proceeding is commenced that would materially affect Lender’s interest in
the Collateral or if Borrower fails to comply with any provision of this
Agreement or any Related Documents, including but not limited to Borrower’s
failure to discharge or pay when due any amounts Borrower is required to
discharge or pay under this Agreement or any Related Documents, Lender on
Borrower’s behalf may (but shall not be obligated to) take any action that
Lender deems appropriate, including but not limited to discharging or paying
all taxes, liens, security interests, encumbrances and other claims, at any
time levied or placed on any Collateral and paying all costs for insuring,
maintaining and preserving any Collateral. 
All such expenditures incurred or paid by Lender for such purposes will
then bear interest at the rate charged under the Note from the date incurred or
paid by Lender to the date of repayment by Borrower.  All such expenses will become a part of the
Indebtedness and, at Lender’s option, will 
(A)  be payable on demand;  (B) 
be added to the balance of the Note and be apportioned among and be payable
with any installment payments to become due during either  (1)  the term of any applicable
insurance policy; or  (2)  the
remaining term of the Note; or  (C) 
be treated as a balloon payment which will be due and payable at the Note’s
maturity.

 

CESSATION OF
ADVANCES.  If Lender has
made any commitment to make any Loan to Borrower, whether under this Agreement
or under any other agreement, Lender shall have no obligation to make Loan Advances
or to disburse Loan proceeds if:  (A) 
an Event of Default has occurred under the terms of this Agreement or any of
the Related Documents or any other agreement that Borrower or any Guarantor has
with Lender;  (B)  Borrower or any
Guarantor dies, becomes incompetent or becomes insolvent, files a petition in
bankruptcy or similar proceedings, or is adjudged a bankrupt;  (C)  there occurs a material adverse
change in Borrower’s financial condition, in the financial condition of any
Guarantor, or in the value of any Collateral securing any Loan; or  (D)  any Guarantor seeks, claims or
otherwise attempts to limit, modify or revoke such Guarantor’s guaranty of the
Loan or any other loan with Lender.

 

RIGHT OF
SETOFF.  To the extent permitted by
applicable law, Lender reserves a right of setoff in all Borrower’s accounts
with Lender (whether checking, savings, or some other account).  This includes all accounts Borrower holds
jointly with someone else and all accounts Borrower may open in the future.  However, this does not include any IRA or
Keogh accounts, or any trust accounts for which setoff would be prohibited by
law.  Borrower authorizes Lender, to the
extent permitted by applicable law, to charge or setoff all sums owing on the
Indebtedness against any and all such accounts, and, at Lender’s option, to
administratively freeze all such accounts to allow Lender to protect Lender’s
charge and setoff rights provided in this paragraph.

 

DEFAULT.  Each of the following shall constitute an
Event of Default under this Agreement:

 

Payment Default.  Borrower fails to make any payment when due
under the Loan following the expiration of applicable cure periods, if any.

 

Other Defaults.  Borrower fails to comply with or to perform
any other term, obligation, covenant or condition contained in this Agreement
or in any of the Related Documents or to comply with or to perform any term,
obligation, covenant or condition contained in any other agreement between
Lender and Borrower following the expiration of thirty (30) days after written
notice of such default is provided by Lender to Borrower.

 

False Statements.  Any warranty, representation or statement
made or furnished to Lender by Borrower or on Borrower’s behalf under this
Agreement or the Related Documents is false or misleading in any material
respect, either now or at the time made or furnished or becomes false or
misleading at any time thereafter.

 

Insolvency.  The dissolution or termination of Borrower’s
existence as a going business, the insolvency of Borrower, the appointment of a
receiver for any part of Borrower’s property, any assignment for the benefit of
creditors, any type of creditor workout, or the commencement of any proceeding
under any bankruptcy or insolvency laws by or against Borrower.

 

Defective Collateralization.  This Agreement or any of the Related
Documents ceases to be in full force and effect (including failure of any
collateral

 

 

document
to create a valid and perfected security interest or lien) at any time and for
any reason if such defect has not been cured following the expiration of thirty
(30) days after notice by Lender to Borrower.

 

Creditor or Forfeiture Proceedings.  Commencement of foreclosure or forfeiture
proceedings, whether by judicial proceeding, self-help, repossession or any
other method, by any creditor of Borrower or by any governmental agency against
any collateral securing the Loan.  This
includes a garnishment of any of Borrower’s accounts, including deposit
accounts, with Lender.  However, this
Event of Default shall not apply if there is a good faith dispute by Borrower
as to the validity or reasonableness of the claim which is the basis of the
creditor or forfeiture proceeding and if Borrower gives Lender written notice
of the creditor or forfeiture proceeding and deposits with Lender monies or a
surety bond for the creditor or forfeiture proceeding, in an amount determined
by Lender, in its sole discretion, as being an adequate reserve or bond for the
dispute.

 

Change in Ownership.  Any person becomes the beneficial owner of
more than fifty percent (50%) of the common stock of Borrower.

 

Adverse Change.  A material adverse change occurs in Borrower’s
financial condition, or Lender reasonably believes the prospect of payment or
performance of the Loan is materially impaired.

 

EFFECT OF AN
EVENT OF DEFAULT.  If any Event
of Default shall occur, except where otherwise provided in this Agreement or
the Related Documents, all commitments and obligations of Lender under this
Agreement or the Related Documents or any other agreement immediately will
terminate (including any obligation to make further Loan Advances or
disbursements), and, at Lender’s option, all Indebtedness immediately will
become due and payable, all without notice of any kind to Borrower, except that
in the case of an Event of Default of the type described in the “Insolvency”
subsection above, such acceleration shall be automatic and not optional.  In addition, Lender shall have all the rights
and remedies provided in the Related Documents or available at law, in equity,
or otherwise.  Except as may be
prohibited by applicable law, all of Lender’s rights and remedies shall be
cumulative and may be exercised singularly or concurrently.  Election by Lender to pursue any remedy shall
not exclude pursuit of any other remedy, and an election to make expenditures
or to take action to perform an obligation of Borrower or of any Grantor shall
not affect Lender’s right to declare a default and to exercise its rights and
remedies.

 

ADDITIONAL
TERMS.  ORAL AGREEMENTS OR COMMITMENTS TO
LOAN MONEY, EXTEND CREDIT OR TO FOREBEAR FROM ENFORCING REPAYMENT OF A DEBT
INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE. TO PROTECT
YOU (BORROWER(S) AND US (LENDER) FROM MISUNDERSTANDING OR DISAPPOINTMENT,
ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING,
WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US,
EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.

 

INSURANCE. Maintain fire
and other risk insurance, public liability insurance, and such other insurance
as Lender may require with respect to Borrower’s properties and operations, in
form amounts, coverage and with insurance companies acceptable to Lender.

 

ADDITIONAL
TERMS.  Lender agrees to make Advances to
Borrower from time to time from the date of this Agreement to the Expiration
Date, provided that the aggregate amount of such Advances outstanding at any
time does not exceed the Borrowing Base and provided further that each and
every advance made under this Agreement shall be at Lender’s sole discretion,
Lender having made no commitment to make any such Advances..

 

MISCELLANEOUS
PROVISIONS.  The following
miscellaneous provisions are a part of this Agreement:

 

Amendments.  This Agreement, together with any Related
Documents, constitutes the entire understanding and agreement of the parties as
to the matters set forth in this Agreement. 
No alteration of or amendment to this Agreement shall be effective
unless given in writing and signed by the party or parties sought to be charged
or bound by the alteration or amendment.

 

Attorneys’ Fees; Expenses.  Borrower agrees to pay upon demand all of
Lender’s reasonable costs and expenses, including Lender’s attorneys’ fees and
Lender’s legal expenses, incurred in connection with the enforcement of this
Agreement.  Lender may hire or pay
someone else to help enforce this Agreement, and Borrower shall pay the
reasonable costs and expenses of such enforcement.  Costs and expenses include Lender’s attorneys’
fees and legal expenses whether or not there is a lawsuit, including attorneys’
fees and legal expenses for bankruptcy proceedings (including efforts to modify
or vacate any automatic stay or injunction), appeals, and any anticipated
post-judgment collection services.  Borrower
also shall pay all court costs and such additional fees as may be directed by
the court.

 

Caption Headings.  Caption headings in this Agreement are for
convenience purposes only and are not to be used to interpret or define the
provisions of this Agreement.

 

Consent to Loan Participation.  Borrower agrees and consents to Lender’s sale
or transfer, whether now or later, of one or more participation interests in
the Loan to one or more purchasers that are affiliates of Lender.  Lender may provide, without any limitation
whatsoever, to any one or more of such purchasers, or potential purchasers, any
information or knowledge Lender may have about Borrower or about any other
matter relating to the Loan, and Borrower hereby waives any rights to privacy
Borrower may have with respect to such matters. 
Borrower additionally waives any and all notices of sale of
participation interests to Lender’s affiliates, as well as all notices of any
repurchase of such participation interests. 
Borrower also agrees that the purchasers of any such participation
interests will be considered as the absolute owners of such interests in the
Loan and will have all the rights granted under the participation agreement or
agreements governing the sale of such participation interests.  Borrower further waives all rights of offset
or counterclaim that it may have now or later against Lender or against any
such purchaser of such a participation interest and unconditionally agrees that
either Lender or such purchaser may enforce Borrower’s obligation under the
Loan irrespective of the failure or insolvency of any holder of any interest in
the Loan.  Borrower further agrees that
the purchaser of any such participation interests may enforce its interests
irrespective of any personal claims or defenses that Borrower may have against
Lender.

 

Governing Law.  This
Agreement will be governed by federal law applicable to Lender and, to the
extent not preempted by federal law, the laws of the State of Colorado without
regard to its conflicts of law provisions. 
This Agreement has been accepted by Lender in the State of Colorado.

 

Choice of Venue.  If there is a lawsuit, Borrower agrees upon
Lender’s request to submit to the jurisdiction of the courts of DENVER County,
State of Colorado.

 

Joint and Several Liability.  All obligations of Borrower under this
Agreement shall be joint and several, and all references to Borrower shall mean
each and every Borrower.  This means that
each Borrower signing below is responsible for all obligations in this Agreement.  Where any one or more of the parties is a
corporation, partnership, limited liability company or similar entity, it is
not necessary for Lender to inquire into the powers of any of the officers,
directors, partners, members, or other agents acting or purporting to act on
the entity’s behalf, and any obligations made or created in reliance upon the
professed exercise of such powers shall be guaranteed under this Agreement.

 

No Waiver by Lender.  Lender shall not be deemed to have waived any
rights under this Agreement unless such waiver is given in writing and signed
by Lender.  No delay or omission on the
part of Lender in exercising any right shall operate as a waiver of such right
or any other right.  A waiver by Lender
of a provision of this Agreement shall not prejudice or constitute a waiver of
Lender’s right otherwise to demand strict compliance with that provision or any
other provision of this Agreement.  No
prior waiver by Lender, nor any course of dealing between Lender and Borrower,
or between Lender and any Grantor, shall constitute a waiver of any of Lender’s
rights or of any of Borrower’s or any Grantor’s obligations as to any future
transactions.  Whenever the consent of
Lender is required under this Agreement, the granting of such consent by Lender
in any instance shall not constitute continuing consent to subsequent instances
where such consent is required and in all cases such consent may be granted or
withheld in the sole discretion of Lender.

 

Notices.  Any notice required to be given under this
Agreement shall be given in writing, and shall be effective when actually
delivered, when actually received by telefacsimile (unless otherwise required
by law), when deposited with a nationally recognized overnight courier, or, if
mailed, when deposited in the United States mail, as first class, certified or
registered mail postage prepaid, directed to the addresses shown near the
beginning of this Agreement.  Any party
may change its address for notices under this Agreement by giving formal written
notice to the other parties, specifying that the purpose of the notice is to
change the party’s address.  For notice
purposes, Borrower agrees to keep Lender informed at all times of Borrower’s
current address.  Unless otherwise
provided or required by law, if there is more than one Borrower, any notice
given by Lender to any Borrower is deemed to be notice given to all Borrowers.

 

Severability.  If a court of competent jurisdiction finds
any provision of this Agreement to be illegal, invalid, or unenforceable as to
any person or circumstance, that finding shall not make the offending provision
illegal, invalid, or unenforceable as to any other person or circumstance.  If feasible, the offending provision shall be
considered modified so that it becomes legal, valid and enforceable.  If the offending provision cannot be so
modified, it shall be considered deleted from this Agreement.  Unless otherwise required by law, the illegality,
invalidity, or unenforceability of any provision of this Agreement shall not
affect the legality, validity or enforceability of any other provision of this
Agreement.

 

 

Subsidiaries and Affiliates of Borrower.  To the extent the context of any provisions
of this Agreement makes it appropriate, including without limitation any
representation, warranty or covenant, the word “Borrower” as used in this
Agreement shall include all of Borrower’s subsidiaries and affiliates.  Notwithstanding the foregoing however, under
no circumstances shall this Agreement be construed to require Lender to make
any Loan or other financial accommodation to any of Borrower’s subsidiaries or
affiliates.

 

Successors and Assigns.  All covenants and agreements by or on behalf
of Borrower contained in this Agreement or any Related Documents shall bind
Borrower’s successors and assigns and shall inure to the benefit of Lender and
its successors and assigns.  Borrower
shall not, however, have the right to assign Borrower’s rights under this
Agreement or any interest therein, without the prior written consent of Lender.

 

Survival of Representations and Warranties.  Borrower understands and agrees that in
extending Loan Advances, Lender is relying on all representations, warranties,
and covenants made by Borrower in this Agreement or in any certificate or other
instrument delivered by Borrower to Lender under this Agreement or the Related
Documents.  Borrower further agrees that
regardless of any investigation made by Lender, all such representations,
warranties and covenants will survive the extension of Loan Advances and
delivery to Lender of the Related Documents, shall be continuing in nature,
shall be deemed made and redated by Borrower at the time each Loan Advance is
made,  and shall remain in full force and
effect until such time as Borrower’s Indebtedness shall be paid in full, or
until this Agreement shall be terminated in the manner provided above,
whichever is the last to occur.

 

Time is of the Essence.  Time is of the essence in the performance of
this Agreement.

 

Waive Jury.  All
parties to this Agreement hereby waive the right to any jury trial in any
action, proceeding, or counterclaim brought by any party against any other
party.

 

DEFINITIONS.  The following capitalized words and terms
shall have the following meanings when used in this Agreement.  Unless specifically stated to the contrary,
all references to dollar amounts shall mean amounts in lawful money of the
United States of America.  Words and
terms used in the singular shall include the plural, and the plural shall
include the singular, as the context may require.  Words and terms not otherwise defined in this
Agreement shall have the meanings attributed to such terms in the Uniform
Commercial Code.  Accounting words and
terms not otherwise defined in this Agreement shall have the meanings assigned
to them in accordance with generally accepted accounting principles as in
effect on the date of this Agreement:

 

Account.  The word “Account” means a trade account,
account receivable, other receivable, or other right to payment for goods sold
or services rendered owing to Borrower (or to a third party grantor acceptable
to Lender).

 

Account Debtor.  The words “Account Debtor” mean the person or
entity obligated upon an Account.

 

Advance.  The word “Advance” means a disbursement of
Loan funds made, or to be made, to Borrower or on Borrower’s behalf under the
terms and conditions of this Agreement.

 

Agreement.  The word “Agreement” means this Business Loan
Agreement, as this Business Loan Agreement may be amended or modified from time
to time, together with all exhibits and schedules attached to this Business
Loan Agreement from time to time.

 

Borrower.  The word “Borrower” means STARTEK, INC.;
STARTEK USA, INC. and STARTEK CANADA SERVICES, LTD. and includes all co-signers
and co-makers signing the Note and all their successors and assigns.

 

Borrowing Base.  The words “Borrowing Base” mean determined by
Lender from time to time, the lesser of (1) $15,000,000.00 or (2) 80.00%
of the aggregate amount of Eligible Accounts minus any outstanding LETTERS OF
CREDIT (not to exceed in corresponding Loan amount based on Eligible Accounts
$15,000,000.00).

 

Business Day.  The words “Business Day” mean a day on which
commercial banks are open in the State of Colorado.

 

Collateral.  The word “Collateral” means all property and
assets granted as collateral security for a Loan, whether real or personal
property, whether granted directly or indirectly, whether granted now or in the
future, and whether granted in the form of a security interest, mortgage,
collateral mortgage, deed of trust, assignment, pledge, crop pledge, chattel
mortgage, collateral chattel mortgage, chattel trust, factor’s lien, equipment
trust, conditional sale, trust receipt, lien, charge, lien or title retention
contract, lease or consignment intended as a security device, or any other
security or lien interest whatsoever, whether created by law, contract, or
otherwise.  The word Collateral also
includes without limitation all collateral described in the Collateral section
of this Agreement.

 

Eligible Accounts.  The words “Eligible Accounts” mean at any
time, all of Borrower’s Accounts which contain selling terms and conditions
acceptable to Lender.  The net amount of
any Eligible Account against which Borrower may borrow shall exclude all
returns, discounts, credits, and offsets of any nature.  Unless otherwise agreed to by Lender in
writing, Eligible Accounts do not include:

 

(1) 
Accounts with respect to which the Account Debtor is employee or agent of
Borrower.

 

(2) 
Accounts with respect to which the Account Debtor is a subsidiary of, or
affiliated with  Borrower or its
shareholders, officers, or directors.

 

(3) 
Accounts with respect to which goods are placed on consignment, guaranteed
sale, or other terms by reason of which the payment by the Account Debtor may
be conditional.

 

(4) 
Accounts with respect to which the Account Debtor is not a resident of the
United States, except to the extent such Accounts are supported by insurance,
bonds or other assurances satisfactory to Lender.

 

(5) 
Accounts with respect to which Borrower is or may become liable to the Account
Debtor for goods sold or services rendered by the Account Debtor to Borrower.

 

(6) 
Accounts which are subject to dispute, counterclaim, or setoff but only to the
extent thereof.

 

(7) 
Accounts with respect to which the goods have not been shipped or delivered, or
the services have not been rendered, to the Account Debtor.

 

(8) 
Accounts with respect to which Lender, in its reasonable  discretion, deems the creditworthiness or
financial condition of the Account Debtor to be unsatisfactory.

 

(9) 
Accounts of any Account Debtor who has filed or has had filed against it a
petition in bankruptcy or an application for relief under any provision of any
state or federal bankruptcy, insolvency, or debtor-in-relief acts; or who has
had appointed a trustee, custodian, or receiver for the assets of such Account
Debtor; or who has made an assignment for the benefit of creditors or has
become insolvent or fails generally to pay its debts (including its payrolls)
as such debts become due.

 

(10) 
Accounts which have not been paid in full within ninety (90) days from the invoice date.

 

Environmental Laws.  The words “Environmental Laws” mean any and
all state, federal and local statutes, regulations and ordinances relating to
the protection of human health or the environment, including without limitation
the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended, 42 U.S.C. Section 9601, et seq. (“CERCLA”), the
Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499 (“SARA”),
the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et
seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901,
et seq., or other applicable state or federal laws, rules, or regulations
adopted pursuant thereto.

 

Event of Default.  The words “Event of Default” mean any of the
events of default set forth in this Agreement in the Default section of this
Agreement.

 

Expiration Date.  The words “Expiration Date” mean the date of
termination of Lender’s commitment to lend under this Agreement.

 

GAAP.  The
word “GAAP” means generally accepted accounting principles.

 

Grantor.  The word “Grantor” means each and all of the
persons or entities granting a Security Interest in any Collateral for the
Loan, including without limitation all Borrowers granting such a Security
Interest.

 

Guarantor.  The word “Guarantor” means any guarantor,
surety, or accommodation party of any or all of the Loan.

 

Guaranty.  The word “Guaranty” means the guaranty from
Guarantor to Lender, including without limitation a guaranty of all or part of
the Note.

 

Hazardous Substances.  The words “Hazardous Substances” mean
materials that, because of their quantity, concentration or physical, chemical
or infectious characteristics, may cause or pose a present or potential hazard
to human health or the environment when improperly used, treated, stored,
disposed of, generated, manufactured, transported or otherwise handled.  The words “Hazardous Substances” are used in
their very broadest sense and include without limitation any and all hazardous
or toxic substances, materials or waste as defined by or listed under the
Environmental Laws.

 

 

The
term “Hazardous Substances” also includes, without limitation, petroleum and
petroleum by-products or any fraction thereof and asbestos.

 

Indebtedness.  The word “Indebtedness” means the
indebtedness evidenced by the Note or Related Documents, including all
principal and interest together with all other indebtedness and costs and
expenses for which Grantor is responsible under this Agreement or under any of
the Related Documents and (a) the payment of Grantor’s obligations
(whether joint, several or otherwise) to Lender as evidenced by any other note(s) or
other evidence of indebtedness executed by such Grantor and all amendments,
modifications, renewals, extensions and substitutions thereof and all
subsequent notes of greater or lesser amounts payable or assigned to Lender; (b) the
performance of each Debtor’s obligations under this security agreement (“Agreement”);
and (c) the payment of any and all other indebtedness, direct or indirect,
mature or unmatured or contingent, joint or several now or hereafter owed to
Secured Party by each Debtor, including (without limitation) indebtedness
unrelated or dissimilar to any indebtedness in 
existence or contemplated by any Debtor at the time this Agreement was
executed or at the time such indebtedness is incurred.

 

Lender.  The
word “Lender” means UMB BANK COLORADO, n.a., its successors and assigns.

 

Letter of Credit.  The words “Letter of Credit” mean one or more
irrevocable standby letters of credit issued by Lender for the account of
Borrower in such form as may be approved by Lender in support of obligations of
Borrower that are permitted to exist under the terms of this Agreement.

 

Letter of Credit Outstandings.  The words “Letter of Credit Outstandings”
mean, at any time, the sum of, without duplication, (i) the aggregate
Stated Amount of all Letters of Credit plus (ii) the
aggregate amount of all Unpaid Drawings in respect of all Letters of Credit.

 

Loan.  The
word “Loan” means any and all loans and financial accommodations from Lender to
Borrower whether now or hereafter existing, and however evidenced, including
without limitation those loans and financial accommodations described herein or
described on any exhibit or schedule attached to this Agreement from time to
time.

 

Note.  The
word “Note” means the Note executed by STARTEK, INC.; STARTEK USA, INC. and
STARTEK CANADA SERVICES, LTD. in the principal amount of $15,000,000.00 dated June 26,
2009, together with all renewals of, extensions of, modifications of,
refinancings of, consolidations of, and substitutions for the note or credit
agreement.

 

Primary Credit Facility.  The words “Primary Credit Facility” mean the
credit facility described in the Line of Credit section of this Agreement.

 

Related Documents.  The words “Related Documents” mean all
promissory notes, credit agreements, loan agreements, environmental agreements,
guaranties, security agreements, mortgages, deeds of trust, security deeds,
collateral mortgages, and all other instruments, agreements and documents,
whether now or hereafter existing, executed in connection with the Loan.

 

Security Agreement.  The words “Security Agreement” mean and
include without limitation any agreements, promises, covenants, arrangements,
understandings or other agreements, whether created by law, contract, or
otherwise, evidencing, governing, representing, or creating a Security
Interest.

 

Security Interest.  The words “Security Interest” mean, without
limitation, any and all types of collateral security, present and future,
whether in the form of a lien, charge, encumbrance, mortgage, deed of trust,
security deed, assignment, pledge, crop pledge, chattel mortgage, collateral
chattel mortgage, chattel trust, factor’s lien, equipment trust, conditional
sale, trust receipt, lien or title retention contract, lease or consignment
intended as a security device, or any other security or lien interest
whatsoever whether created by law, contract, or otherwise.

 

Stated
Amount.  The words “Stated Amount” of
each Letter of Credit mean, at any time, the maximum amount available to be
drawn thereunder (regardless of whether any condition for drawing could be
met).

 

Unpaid
Drawings.  The words “Unpaid
Drawings” mean any payment or disbursement made by Lender under any Letter of
Credit which has been issued for Borrower’s account which has not been
reimbursed.

 

BORROWER
ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT
(ASSET BASED) AND BORROWER AGREES TO ITS TERMS. 
THIS BUSINESS LOAN AGREEMENT (ASSET BASED) IS DATED JUNE 26, 2009.

 

BORROWER:

 

 

STARTEK,
INC.

 

	
  By: 

  	
  /s/ A.
  LAURENCE JONES

  	
   

  	
  By:

  	
  /s/ DAVID
  G. DURHAM

  
	
  A. Laurence
  Jones, Chief Exec. Officer/Pres. of 

  	
   

  	
  David G.
  Durham, Exec. VP/CFO/Treasurer of

  
	
  STARTEK,
  INC.

  	
   

  	
  STARTEK,
  INC.

  

 

 

STARTEK USA,
INC.

 

	
  By: 

  	
  /s/ A.
  LAURENCE JONES

  	
   

  	
  By: 

  	
  /s/ DAVID
  G. DURHAM

  
	
  A.
  Laurence Jones, Chief Exe. Officer/Pres. of

  	
   

  	
  David G.
  Durham, Exec VP/CFO/Treasurer of

  
	
  STARTEK
  USA, INC.

  	
   

  	
  STARTEK
  USA, INC.

  

 

 

STARTEK
CANADA SERVICES, LTD.

 

	
  By: 

  	
  /s/ A.
  LAURENCE JONES

  	
   

  	
  By:

  	
  /s/ DAVID
  G. DURHAM

  
	
  A.
  Laurence Jones, Chief Exec. Officer/Pres. of 

  	
   

  	
  David G.
  Durham, Exec. VP/CFO/Treasurer of

  
	
  STARTEK CANADA
  SERVICES, LTD.

  	
   

  	
  STARTEK
  CANADA SERVICES, LTD.

  

 

LENDER:

 

 

UMB BANK
COLORADO, N.A.

 

	
  By:

  	
  /s/ Jon M. Robinson, President

  	
   

  	
   

  	
   

  
	
  Authorized
  Signer

  	
   

  	
   

  

 

LASER PRO Lending, Ver. 5.44.00.002 
Copr. Harland Financial Solutions, Inc. 1997, 2009.  All Rights Reserved.  — CO 
S:\APPS\hfs\CFI\LPL\C40.FC 
TR-62141  PR-63 (M)EXHIBIT
10.5

 

COMMERCIAL SECURITY AGREEMENT

 

	
  Principal

  	
   

  	
  Loan
  Date

  	
   

  	
  Maturity

  	
   

  	
  Loan
  No

  	
   

  	
  Call
  / Coll

  	
   

  	
  Account

  	
   

  	
  Officer

  	
   

  	
  Initials

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  $15,000,000.00

  	
   

  	
  06-26-2009

  	
   

  	
  08-01-2010

  	
   

  	
   

  	
   

  	
  4A0 / 9215

  	
   

  	
   

  	
   

  	
  PMF01

  	
   

  	
   

  

 

References in the boxes above are for Lender’s use only and do not limit
the applicability of this document to any particular loan or item.

 

Any item above containing “***” has been omitted due to text length
limitations.

 

	
  Borrower:

  	
   

  	
  STARTEK,
  INC.

  STARTEK USA, INC.

  STARTEK CANADA SERVICES, LTD.

  44 COOK ST., SUITE 400

  DENVER, CO 80206

  	
   

  	
  Lender:

  	
   

  	
  UMB BANK
  COLORADO, n.a.

  DOWNTOWN DENVER BANKING CENTER

  1670 BROADWAY

  DENVER, CO 80202-4838

  (303) 839-1300

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Grantor:

  	
   

  	
  STARTEK,
  INC.

  44 COOK ST., SUITE 400

  DENVER, CO 
  80206

  	
   

  	
   

  	
   

  	
   

  

 

THIS
COMMERCIAL SECURITY AGREEMENT dated June 26, 2009, is made and executed
among STARTEK, INC. (“Grantor”); STARTEK, INC.; STARTEK USA, INC. and STARTEK
CANADA SERVICES, LTD. (“Borrower”); and UMB BANK COLORADO, n.a. (“Lender”).

 

GRANT OF
SECURITY INTEREST.  For valuable
consideration, Grantor grants to Lender a security interest in the Collateral
to secure the Indebtedness and agrees that Lender shall have the rights stated
in this Agreement with respect to the Collateral, in addition to all other
rights which Lender may have by law.

 

COLLATERAL
DESCRIPTION.  The word “Collateral”
as used in this Agreement means the following described property, whether now
owned or hereafter acquired, whether now existing or hereafter arising, and
wherever located, in which Grantor is giving to Lender a security interest for
the payment of the Indebtedness and performance of all other obligations under
the Note and this Agreement:

 

All Accounts and General Intangibles

 

In addition, the word “Collateral”
also includes all the following, whether now owned or hereafter acquired,
whether now existing or hereafter arising, and wherever located:

 

(A) 
All accessions, attachments, accessories, replacements of and additions to any
of the collateral described herein, whether added now or later.

 

(B) 
All products and produce of any of the property described in this Collateral
section.

 

(C) 
All accounts, general intangibles, instruments, rents, monies, payments, and
all other rights, arising out of a sale, lease, consignment or other
disposition of any of the property described in this Collateral section.

 

(D) 
All proceeds (including insurance proceeds) from the sale, destruction, loss,
or other disposition of any of the property described in this Collateral
section, and sums due from a third party who has damaged or destroyed the
Collateral or from that party’s insurer, whether due to judgment, settlement or
other process.

 

(E) 
All records and data relating to any of the property described in this
Collateral section, whether in the form of a writing, photograph, microfilm,
microfiche, or electronic media, together with all of Grantor’s right, title,
and interest in and to all computer software required to utilize, create,
maintain, and process any such records or data on electronic media.

 

CROSS-COLLATERALIZATION.  In addition to the Note, this Agreement
secures all obligations, debts and liabilities, plus interest thereon, of
either Grantor or Borrower to Lender, or any one or more of them, as well as
all claims by Lender against Borrower and Grantor or any one or more of them,
whether now existing or hereafter arising, whether related or unrelated to the
purpose of the Note, whether voluntary or otherwise, whether due or not due,
direct or indirect, determined or undetermined, absolute or contingent, liquidated
or unliquidated, whether Borrower or Grantor may be liable individually or
jointly with others, whether obligated as guarantor, surety, accommodation
party or otherwise, and whether recovery upon such amounts may be or hereafter
may become barred by any statute of limitations, and whether the obligation to
repay such amounts may be or hereafter may become otherwise unenforceable.

 

BORROWER’S
WAIVERS AND RESPONSIBILITIES.  Except as otherwise required under this
Agreement or by applicable law,  (A) 
Borrower agrees that Lender need not tell Borrower about any action or inaction
Lender takes in connection with this Agreement; 
(B)  Borrower assumes the responsibility for being and keeping
informed about the Collateral; and  (C) 
Borrower waives any defenses that may arise because of any action or inaction
of Lender, including without limitation any failure of Lender to realize upon
the Collateral or any delay by Lender in realizing upon the Collateral; and
Borrower agrees to remain liable under the Note no matter what action Lender
takes or fails to take under this Agreement.

 

GRANTOR’S
REPRESENTATIONS AND WARRANTIES.  Grantor warrants that:  (A)  this Agreement is executed at
Borrower’s request and not at the request of Lender;  (B)  Grantor has the full right, power
and authority to enter into this Agreement and to pledge the Collateral to
Lender;  (C)  Grantor has
established adequate means of obtaining from Borrower on a continuing basis
information about Borrower’s financial condition; and  (D)  Lender has made no representation
to Grantor about Borrower or Borrower’s creditworthiness.

 

GRANTOR’S
WAIVERS.  Grantor
waives all requirements of presentment, protest, demand, and notice of dishonor
or non-payment to Borrower or Grantor, or any other party to the Indebtedness
or the Collateral.  Lender may do any of
the following with respect to any obligation of any Borrower, without first
obtaining the consent of Grantor:  (A) 
grant any extension of time for any payment, 
(B)  grant any renewal,  (C) 
permit any modification of payment terms or other terms, or  (D)  exchange or release any Collateral
or other security.  No such act or
failure to act shall affect Lender’s rights against Grantor or the Collateral.

 

RIGHT OF
SETOFF.  To the extent permitted by applicable
law, Lender reserves a right of setoff in all Grantor’s accounts with Lender
(whether checking, savings, or some other account).  This includes all accounts Grantor holds
jointly with someone else and all accounts Grantor may open in the future.  However, this does not include any IRA or
Keogh accounts, or any trust accounts for which setoff would be prohibited by
law.  Grantor authorizes Lender, to the
extent permitted by applicable law, to charge or setoff all sums owing on the
Indebtedness against any and all such accounts, and, at Lender’s option, to
administratively freeze all such accounts to allow Lender to protect Lender’s
charge and setoff rights provided in this paragraph.

 

GRANTOR’S
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE COLLATERAL.  With respect to the Collateral, Grantor
represents and promises to Lender that:

 

Perfection of Security Interest.  Grantor agrees to take whatever actions are
requested by Lender to perfect and continue Lender’s security interest in the
Collateral.  Upon request of Lender,
Grantor will deliver to Lender any and all of the documents evidencing or
constituting the Collateral, and Grantor will note Lender’s interest upon any
and all chattel paper and instruments if not delivered to Lender for possession
by Lender.  This is a continuing Security Agreement and will continue in effect even
though all or any part of the Indebtedness is paid in full and even though for
a period of time Borrower may not be indebted to Lender.

 

Notices to Lender.  Grantor will promptly notify Lender in
writing at Lender’s address shown above (or such other addresses as Lender may
designate from time to time) prior to any 
(1)  change in Grantor’s name; 
(2)  change in Grantor’s assumed business name(s);  (3)  change in the management of the
Corporation Grantor;  (4)  change in
the authorized signer(s);  (5) 
change in Grantor’s principal office address; 
(6)  change in Grantor’s state of organization;  (7)  conversion of Grantor to a new or
different type of business entity; or  (8) 
change in any other aspect of Grantor that directly or indirectly relates to
any agreements between Grantor and Lender. 
No change in Grantor’s name or state of organization will take effect until
after Lender has received notice.

 

 

No Violation.  The execution and delivery of this Agreement
will not violate any law or agreement governing Grantor or to which Grantor is
a party, and its certificate or articles of incorporation and bylaws do not
prohibit any term or condition of this Agreement.

 

Enforceability of Collateral.  To the extent the Collateral consists of
accounts, chattel paper, or general intangibles, as defined by the Uniform
Commercial Code, the Collateral is enforceable in accordance with its terms, is
genuine, and fully complies with all applicable laws and regulations concerning
form, content and manner of preparation and execution, and all persons
appearing to be obligated on the Collateral have authority and capacity to
contract and are in fact obligated as they appear to be on the Collateral.  At the time any account becomes subject to a
security interest in favor of Lender, the account shall be a good and valid
account representing an undisputed, bona fide indebtedness incurred by the
account debtor, for merchandise held subject to delivery instructions or
previously shipped or delivered pursuant to a contract of sale, or for services
previously performed by Grantor with or for the account debtor.   After the occurrence of an Event of Default
under this Agreement, Grantor shall not, without Lender’s prior written
consent, compromise, settle, adjust, or extend payment under or with regard to
any such Accounts.  There shall be no
setoffs or counterclaims against any of the Collateral, and no agreement shall
have been made under which any deductions or discounts may be claimed
concerning the Collateral except those disclosed to Lender in writing.

 

Location of the Collateral.  Except in the ordinary course of Grantor’s
business, Grantor agrees to keep the Collateral (or to the extent the Collateral
consists of intangible property such as accounts or general intangibles, the
records concerning the Collateral) at Grantor’s address shown above or at such
other locations as are acceptable to Lender. 
Upon Lender’s request, Grantor will deliver to Lender in form
satisfactory to Lender a schedule of real properties and Collateral locations
relating to Grantor’s operations, including without limitation the
following:  (1)  all real property
Grantor owns or is purchasing;  (2)   all real property Grantor is renting or
leasing;  (3)  all storage
facilities Grantor owns, rents, leases, or uses; and  (4)  all other properties where
Collateral is or may be located.

 

Removal of the Collateral.  Except in the ordinary course of Grantor’s
business,  Grantor shall not remove the
Collateral from its existing location without Lender’s prior written
consent.  Grantor shall, whenever
requested, advise Lender of the exact location of the Collateral.

 

Transactions Involving Collateral.  Except for inventory sold or accounts
collected in the ordinary course of Grantor’s business, or as otherwise
provided for in this Agreement, Grantor shall not sell, offer to sell, or
otherwise transfer or dispose of the Collateral.  Grantor shall not pledge, mortgage, encumber
or otherwise permit the Collateral to be subject to any lien, security
interest, encumbrance, or charge, other than the security interest provided for
in this Agreement, without the prior written consent of Lender.  This includes security interests even if
junior in right to the security interests granted under this Agreement.  Unless waived by Lender, all proceeds from
any disposition of the Collateral (for whatever reason) shall be held in trust
for Lender and shall not be commingled with any other funds; provided however,
this requirement shall not constitute consent by Lender to any sale or other
disposition.  Upon receipt, Grantor shall
immediately deliver any such proceeds to Lender.

 

Title. 
Grantor represents and warrants to Lender that Grantor holds good and
marketable title to the Collateral, free and clear of all liens and
encumbrances except for the lien of this Agreement.  No financing statement covering any of the
Collateral is on file in any public office other than those which reflect the
security interest created by this Agreement or to which Lender has specifically
consented.  Grantor shall defend Lender’s
rights in the Collateral against the claims and demands of all other persons.

 

Repairs and Maintenance.  Grantor agrees to keep and maintain, and to
cause others to keep and maintain, the Collateral in good order, repair and
condition at all times while this Agreement remains in effect.  Grantor further agrees to pay when due all
claims for work done on, or services rendered or material furnished in
connection with the Collateral so that no lien or encumbrance may ever attach
to or be filed against the Collateral.

 

Inspection of Collateral.  Lender and Lender’s designated
representatives and agents shall have the right at all reasonable times to examine
and inspect the Collateral wherever located.

 

Taxes, Assessments and Liens.  Grantor will pay when due (prior to
delinquency) all taxes, assessments and liens upon the Collateral, its use or
operation, upon this Agreement, upon any promissory note or notes evidencing
the Indebtedness, or upon any of the other Related Documents.  Grantor may withhold any such payment or may
elect to contest any lien if Grantor is in good faith conducting an appropriate
proceeding to contest the obligation to pay and so long as Lender’s interest in
the Collateral is not jeopardized in Lender’s sole opinion.  If the Collateral is subjected to a lien
which is not discharged within fifteen (15) days, Grantor shall deposit with
Lender cash, a sufficient corporate surety bond or other security satisfactory
to Lender in an amount adequate to provide for the discharge of the lien plus
any interest, costs, attorneys’ fees or other charges that could accrue as a
result of foreclosure or sale of the Collateral.  In any contest Grantor shall defend itself
and Lender and shall satisfy any final adverse judgment before enforcement
against the Collateral.  Grantor shall
name Lender as an additional obligee under any surety bond furnished in the contest
proceedings.  Grantor further agrees to
furnish Lender with evidence that such taxes, assessments, and governmental and
other charges have been paid in full and in a timely manner.  Grantor may withhold any such payment or may
elect to contest any lien if Grantor is in good faith conducting an appropriate
proceeding to contest the obligation to pay and so long as Lender’s interest in
the Collateral is not jeopardized.

 

Compliance with Governmental Requirements.  Grantor shall comply promptly in all material
respects with all laws, ordinances, rules and regulations of all
governmental authorities, now or hereafter in effect, applicable to the
ownership, production, disposition, or use of the Collateral, including all
laws or regulations relating to the undue erosion of highly-erodible land or relating
to the conversion of wetlands for the production of an agricultural product or
commodity.  Grantor may contest in good
faith any such law, ordinance or regulation and withhold compliance during any
proceeding, including appropriate appeals, so long as Lender’s interest in the
Collateral, in Lender’s opinion, is not jeopardized.

 

Hazardous Substances.  Grantor represents and warrants that the
Collateral never has been, and never will be so long as this Agreement remains
a lien on the Collateral, used in violation of any Environmental Laws or for
the generation, manufacture, storage, transportation, treatment, disposal,
release or threatened release of any Hazardous Substance.  The representations and warranties contained
herein are based on Grantor’s due diligence in investigating the Collateral for
Hazardous Substances.  Grantor
hereby  (1)  releases and waives any
future claims against Lender for indemnity or contribution in the event Grantor
becomes liable for cleanup or other costs under any Environmental Laws,
and  (2)  agrees to indemnify,
defend, and hold harmless Lender against any and all claims and losses
resulting from a breach of this provision of this Agreement.  This obligation to indemnify and defend shall
survive the payment of the Indebtedness and the satisfaction of this Agreement.

 

Maintenance of Casualty Insurance.  Grantor shall procure and maintain all risks
insurance, including without limitation fire, theft and liability coverage
together with such other insurance as Lender may reasonably require with
respect to the Collateral, in form, amounts, coverages and basis reasonably
acceptable to Lender and issued by a company or companies reasonably acceptable
to Lender.  Grantor, upon request of Lender,
will deliver to Lender from time to time the policies or certificates of
insurance in form satisfactory to Lender, including stipulations that coverages
will not be cancelled or diminished without at least thirty (30) days’ prior
written notice to Lender and not including any disclaimer of the insurer’s
liability for failure to give such a notice. 
Each insurance policy also shall include an endorsement providing that
coverage in favor of Lender will not be impaired in any way by any act,
omission or default of Grantor or any other person.  In connection with all policies covering
assets in which Lender holds or is offered a security interest, Grantor will
provide Lender with such loss payable or other endorsements as Lender may
require.  If Grantor at any time fails to
obtain or maintain any insurance as required under this Agreement, Lender may
(but shall not be obligated to) obtain such insurance as Lender deems
appropriate, including if Lender so chooses “single interest insurance,” which
will cover only Lender’s interest in the Collateral.

 

Application of Insurance Proceeds.  Grantor shall promptly notify Lender of any
loss or damage to the Collateral, whether or not such casualty or loss is
covered by insurance.  Lender may make
proof of loss if Grantor fails to do so within fifteen (15) days of the
casualty.  All proceeds of any insurance
on the Collateral, including accrued proceeds thereon, shall be held by Lender
as part of the Collateral.  If Lender
consents to repair or replacement of the damaged or destroyed Collateral,
Lender shall, upon satisfactory proof of expenditure,  pay or reimburse Grantor from the proceeds
for the reasonable cost of repair or restoration.  If Lender does not consent to repair or
replacement of the Collateral, Lender shall retain a sufficient amount of the
proceeds to pay all of the Indebtedness, and shall pay the balance to
Grantor.  Any proceeds which have not
been disbursed within six (6) months after their receipt and which Grantor
has not committed to the repair or restoration of the Collateral shall be used
to prepay the Indebtedness.

 

Insurance Reports.  Grantor, upon request of Lender, shall
furnish to Lender reports on each existing policy of insurance showing such
information as Lender may reasonably request including the following:  (1)  the name of the insurer;  (2)  the risks insured;  (3)  the amount of the policy;  (4)  the property insured;  (5)  the then current value on the basis
of which insurance has been obtained and the manner of determining that value;
and  (6)  the expiration date of the
policy.  In addition, Grantor shall upon
request by Lender (however not more often than annually) have an independent
appraiser satisfactory to Lender determine, as applicable, the cash value or
replacement cost of the Collateral.

 

Financing Statements.  Grantor authorizes Lender to file a UCC
financing statement, or alternatively, a copy of this Agreement to perfect
Lender’s security interest.  At Lender’s
request, Grantor additionally agrees to sign all other documents that are
necessary to perfect, protect, and continue Lender’s security interest in the
Property.  This includes making sure
Lender is shown as the first and only security interest holder on the title
covering the Property.  Grantor will pay
all filing fees, title transfer fees, and other fees and costs involved unless
prohibited by law or unless Lender is required by law to pay such fees and
costs.  Grantor irrevocably appoints
Lender to execute documents necessary to transfer title if there is a default.  Lender may file a copy of this Agreement as a
financing statement.  If Grantor changes
Grantor’s name or address, or the name or address of any person granting a 

 

 

security
interest under this Agreement changes, Grantor will promptly notify the Lender
of such change.

 

GRANTOR’S
RIGHT TO POSSESSION AND TO COLLECT ACCOUNTS.  Until default and except as otherwise
provided below with respect to accounts, Grantor may have possession of the
tangible personal property and beneficial use of all the Collateral and may use
it in any lawful manner not inconsistent with this Agreement or the Related
Documents, provided that Grantor’s right to possession and beneficial use shall
not apply to any Collateral where possession of the Collateral by Lender is
required by law to perfect Lender’s security interest in such Collateral.  Until otherwise notified by Lender, Grantor
may collect any of the Collateral consisting of accounts.  At any time and even though no Event of
Default exists, Lender may exercise its rights to collect the accounts and to
notify account debtors to make payments directly to Lender for application to
the Indebtedness.  If Lender at any time
has possession of any Collateral, whether before or after an Event of Default,
Lender shall be deemed to have exercised reasonable care in the custody and
preservation of the Collateral if Lender takes such action for that purpose as
Grantor shall request or as Lender, in Lender’s sole discretion, shall deem
appropriate under the circumstances, but failure to honor any request by
Grantor shall not of itself be deemed to be a failure to exercise reasonable
care.  Lender shall not be required to
take any steps necessary to preserve any rights in the Collateral against prior
parties, nor to protect, preserve or maintain any security interest given to
secure the Indebtedness.

 

LENDER’S
EXPENDITURES.  If any action
or proceeding is commenced that would materially affect Lender’s interest in
the Collateral or if Grantor fails to comply with any provision of this
Agreement or any Related Documents, including but not limited to Grantor’s
failure to discharge or pay when due any amounts Grantor is required to
discharge or pay under this Agreement or any Related Documents, Lender on
Grantor’s behalf may (but shall not be obligated to) take any action that Lender
deems appropriate, including but not limited to discharging or paying all
taxes, liens, security interests, encumbrances and other claims, at any time
levied or placed on the Collateral and paying all costs for insuring,
maintaining and preserving the Collateral. 
All such expenditures incurred or paid by Lender for such purposes will
then bear interest at the rate charged under the Note from the date incurred or
paid by Lender to the date of repayment by Grantor.  All such expenses will become a part of the
Indebtedness and, at Lender’s option, will 
(A)  be payable on demand;  (B) 
be added to the balance of the Note and be apportioned among and be payable
with any installment payments to become due during either  (1)  the term of any applicable insurance
policy; or  (2)  the remaining term
of the Note; or  (C)  be treated as
a balloon payment which will be due and payable at the Note’s maturity.  The Agreement also will secure payment of
these amounts.  Such right shall be in
addition to all other rights and remedies to which Lender may be entitled upon
Default.

 

DEFAULT.  Each of the following shall constitute an
Event of Default under this Agreement:

 

Payment Default.  Borrower fails to make any payment when due
under the Indebtedness following the expiration of applicable cure periods, if
any.

 

Other Defaults.  Borrower or Grantor fails to comply with or
to perform any other term, obligation, covenant or condition contained in this
Agreement or in any of the Related Documents or to comply with or to perform
any term, obligation, covenant or condition contained in any other agreement
between Lender and Borrower or Grantor following the expiration of thirty (30)
days after written notice of such default is provided by Lender to Borrower.

 

False Statements.  Any warranty, representation or statement
made or furnished to Lender by Borrower or Grantor or on Borrower’s or Grantor’s
behalf under this Agreement or the Related Documents is false or misleading in
any material respect, either now or at the time made or furnished or becomes
false or misleading at any time thereafter.

 

Defective Collateralization.  This Agreement or any of the Related
Documents ceases to be in full force and effect (including failure of any
collateral document to create a valid and perfected security interest or lien)
at any time and for any reason if such defect has not been cured following the
expiration of thirty (30) days after notice by Lender to Borrower.

 

Insolvency.  The dissolution or termination of Borrower’s
or Grantor’s existence as a going business, the insolvency of Borrower or
Grantor, the appointment of a receiver for any part of Borrower’s or Grantor’s
property, any assignment for the benefit of creditors, any type of creditor
workout, or the commencement of any proceeding under any bankruptcy or
insolvency laws by or against Borrower or Grantor.

 

Creditor or Forfeiture Proceedings.  Commencement of foreclosure or forfeiture
proceedings, whether by judicial proceeding, self-help, repossession or any
other method, by any creditor of Borrower or Grantor or by any governmental
agency against any collateral securing the Indebtedness.  This includes a garnishment of any of
Borrower’s or Grantor’s accounts, including deposit accounts, with Lender.  However, this Event of Default shall not
apply if there is a good faith dispute by Borrower or Grantor as to the
validity or reasonableness of the claim which is the basis of the creditor or
forfeiture proceeding and if Borrower or Grantor gives Lender written notice of
the creditor or forfeiture proceeding and deposits with Lender monies or a
surety bond for the creditor or forfeiture proceeding, in an amount determined
by Lender, in its sole discretion, as being an adequate reserve or bond for the
dispute.

 

Adverse Change.  A material adverse change occurs in Borrower’s
or Grantor’s financial condition, or Lender believes the prospect of payment or
performance of the Indebtedness is impaired.

 

RIGHTS AND
REMEDIES ON DEFAULT.  If an Event
of Default occurs under this Agreement, at any time thereafter, Lender shall
have all the rights of a secured party under the Colorado Uniform Commercial
Code.  In addition and without
limitation, Lender may exercise any one or more of the following rights and remedies:

 

Accelerate Indebtedness.  Lender may declare the entire Indebtedness,
including any prepayment penalty which Borrower would be required to pay,
immediately due and payable, without notice of any kind to Borrower or Grantor.

 

Assemble Collateral.  Lender may require Grantor to deliver to
Lender all or any portion of the Collateral and any and all certificates of
title and other documents relating to the Collateral.  Lender may require Grantor to assemble the
Collateral and make it available to Lender at a place to be designated by
Lender.  Lender also shall have full
power to enter upon the property of Grantor to take possession of and remove
the Collateral.  If the Collateral
contains other goods not covered by this Agreement at the time of repossession,
Grantor agrees Lender may take such other goods, provided that Lender makes
reasonable efforts to return them to Grantor after repossession.

 

Sell the Collateral.  Lender shall have full power to sell, lease,
transfer, or otherwise deal with the Collateral or proceeds thereof in Lender’s
own name or that of Grantor.  Lender may
sell the Collateral at public auction or private sale.  Unless the Collateral threatens to decline
speedily in value or is of a type customarily sold on a recognized market,
Lender will give Grantor, and other persons as required by law, reasonable
notice of the time and place of any public sale, or the time after which any
private sale or any other disposition of the Collateral is to be made.  However, no notice need be provided to any
person who, after Event of Default occurs, enters into and authenticates an
agreement waiving that person’s right to notification of sale.  The requirements of reasonable notice shall
be met if such notice is given at least ten (10) days before the time of
the sale or disposition.  All expenses
relating to the disposition of the Collateral, including without limitation the
expenses of retaking, holding, insuring, preparing for sale and selling the
Collateral, shall become a part of the Indebtedness secured by this Agreement
and shall be payable on demand, with interest at the Note rate from date of
expenditure until repaid.

 

Appoint Receiver.  Lender shall have the right to have a
receiver appointed to take possession of all or any part of the Collateral,
with the power to protect and preserve the Collateral, to operate the
Collateral preceding foreclosure or sale, and to collect the Rents from the
Collateral and apply the proceeds, over and above the cost of the receivership,
against the Indebtedness.  The receiver
may serve without bond if permitted by law. 
Lender’s right to the appointment of a receiver shall exist whether or
not the apparent value of the Collateral exceeds the Indebtedness by a
substantial amount.  Employment by Lender
shall not disqualify a person from serving as a receiver.  Receiver may be appointed by a court of
competent jurisdiction upon ex parte application and without notice, notice
being expressly waived.

 

Collect Revenues, Apply Accounts.  Lender, either itself or through a receiver,
may collect the payments, rents, income, and revenues from the Collateral.  Lender may at any time in Lender’s discretion
transfer any Collateral into Lender’s own name or that of Lender’s nominee and
receive the payments, rents, income, and revenues therefrom and hold the same
as security for the Indebtedness or apply it to payment of the Indebtedness in
such order of preference as Lender may determine.  Insofar as the Collateral consists of
accounts, general intangibles, insurance policies, instruments, chattel paper,
choses in action, or similar property, Lender may demand, collect, receipt for,
settle, compromise, adjust, sue for, foreclose, or realize on the Collateral as
Lender may determine, whether or not Indebtedness or Collateral is then due.  For these purposes, Lender may, on behalf of
and in the name of Grantor, receive, open and dispose of mail addressed to
Grantor; change any address to which mail and payments are to be sent; and
endorse notes, checks, drafts, money orders, documents of title, instruments
and items pertaining to payment, shipment, or storage of any Collateral.  To facilitate collection, Lender may notify
account debtors and obligors on any Collateral to make payments directly to
Lender.

 

Obtain Deficiency.  If Lender chooses to sell any or all of the
Collateral, Lender may obtain a judgment against Borrower for any deficiency
remaining on the Indebtedness due to Lender after application of all amounts
received from the exercise of the rights provided in this Agreement.  Borrower shall be liable for a deficiency
even if the transaction described in this subsection is a sale of accounts or
chattel paper.

 

Other Rights and Remedies.  Lender shall have all the rights and remedies
of a secured creditor under the provisions of the Uniform Commercial Code, as
may be amended from time to time.  In
addition, Lender shall have and may exercise any or all other rights and
remedies it may have available at law, in equity, or otherwise.

 

 

Election of Remedies.  Except as may be prohibited by applicable
law, all of Lender’s rights and remedies, whether evidenced by this Agreement,
the Related Documents, or by any other writing, shall be cumulative and may be
exercised singularly or concurrently. 
Election by Lender to pursue any remedy shall not exclude pursuit of any
other remedy, and an election to make expenditures or to take action to perform
an obligation of Grantor under this Agreement, after Grantor’s failure to
perform, shall not affect Lender’s right to declare a default and exercise its
remedies.

 

ADDITIONAL
TRUST OBLIGATIONS. If the Owner of the named Collateral, listed in the
attached Security Instrument is a Trust, then, to the extent the foregoing
described Trust Agreement does not specifically authorize this Pledge and
Security Agreement, the provisions of the foregoing described Trust Agreement
are hereby amended to the extent necessary to authorize the same and the
performance of all the provisions hereof. In the event the foregoing described
Trust Agreement is revoked prior to the payment in full of all obligations of
Borrower to Lender and secured by the Collateral, this Pledge and Security
Agreement shall nonetheless remain in full force and effect until all such
obligations of the Borrower are paid in full.

 

ADDITIONAL
TERMS. Grantor’s failure to promptly provide additional collateral of a type
and in a manner satisfactory to Lender upon Lender’s request therefore due to
Lender’s reasonable determination that the value of the Collateral is
insufficient to adequately secure the Indebtedness.

 

In the event the Debtor does
not maintain insurance coverage on the Collateral deemed adequate by Secured
Party, Secured Party may, in its discretion, purchase insurance or additional
insurance, but shall not be obligated to do so. The premium for such additional
insurance shall be added to and become part of the Obligations secured by this
Agreement. Any refund of insurance premiums shall be applied to the cost of
other insurance, or upon the last maturing installment (or the principal) of
the debt secured by this Agreement.

 

Debtor waives the right to
direct the application of any and all payments at any time or times received by
Secured Party on account of the Obligations secured hereby or as proceeds of
the Collateral and agrees that Secured Party shall have the exclusive right to
apply and reapply any and all such payments in such manner as Secured Party in
its sole discretion my deem advisable, notwithstanding any entry by Secured Party
upon any of its books and records.

 

In the event Lender, in its
sole discretion, issues letters of credit for the account of the Borrower
pursuant hereto (“Letters of Credit”), each such Letter of Credit shall be
issued subject to such terms and conditions as Lender shall determine at the
time of issuance of each such Letter of Credit, including but not limited to
letter of credit fees and the terms hereof. The face amount of all such Letters
of Credit shall be deemed to be outstanding loans hereunder for purposes of
computing the amount available to Borrower to borrow under any applicable
credit facility with Lender. At no time shall the face amount of all
outstanding Letters of Credit plus the principal amount of all outstanding
loans from Lender to Borrower under any such credit facility exceed the Loan
Value.

 

Bankcard Obligations: All
currently existing and future bankcard obligations owing by the Borrower to the
Lender or to any affiliate of the Lender created pursuant to the use of
bankcards now existing or hereafter issued by the Lender to the Borrower, shall
be secured by and pursuant to the terms of this Security Agreement. All terms
of the Security Agreement not expressly modified hereby shall remain in full
force and effect.

 

MISCELLANEOUS
PROVISIONS.  The following
miscellaneous provisions are a part of this Agreement:

 

Amendments.  This Agreement, together with any Related
Documents, constitutes the entire understanding and agreement of the parties as
to the matters set forth in this Agreement.  No alteration of or amendment to this
Agreement shall be effective unless given in writing and signed by the party or
parties sought to be charged or bound by the alteration or amendment.

 

Attorneys’ Fees; Expenses.  Grantor agrees to pay upon demand all of
Lender’s reasonable costs and expenses, including Lender’s attorneys’ fees and
Lender’s legal expenses, incurred in connection with the enforcement of this
Agreement.  Lender may hire or pay
someone else to help enforce this Agreement, and Grantor shall pay the
reasonable costs and expenses of such enforcement.  Costs and expenses include Lender’s attorneys’
fees and legal expenses whether or not there is a lawsuit, including attorneys’
fees and legal expenses for bankruptcy proceedings (including efforts to modify
or vacate any automatic stay or injunction), appeals, and any anticipated
post-judgment collection services. 
Grantor also shall pay all court costs and such additional fees as may
be directed by the court.

 

Caption Headings.  Caption headings in this Agreement are for
convenience purposes only and are not to be used to interpret or define the
provisions of this Agreement.

 

Governing Law.  This
Agreement will be governed by federal law applicable to Lender and, to the
extent not preempted by federal law, the laws of the State of Colorado without
regard to its conflicts of law provisions. 
This Agreement has been accepted by Lender in the State of Colorado.

 

Choice of Venue.  If there is a lawsuit, Grantor agrees upon
Lender’s request to submit to the jurisdiction of the courts of DENVER County,
State of Colorado.

 

Joint and Several Liability.  All obligations of Borrower and Grantor under
this Agreement shall be joint and several, and all references to Grantor shall
mean each and every Grantor, and all references to Borrower shall mean each and
every Borrower.  This means that each
Borrower and Grantor signing below is responsible for all obligations in this
Agreement.  Where any one or more of the
parties is a corporation, partnership, limited liability company or similar
entity, it is not necessary for Lender to inquire into the powers of any of the
officers, directors, partners, members, or other agents acting or purporting to
act on the entity’s behalf, and any obligations made or created in reliance
upon the professed exercise of such powers shall be guaranteed under this
Agreement.

 

No Waiver by Lender.  Lender shall not be deemed to have waived any
rights under this Agreement unless such waiver is given in writing and signed
by Lender.  No delay or omission on the
part of Lender in exercising any right shall operate as a waiver of such right
or any other right.  A waiver by Lender
of a provision of this Agreement shall not prejudice or constitute a waiver of
Lender’s right otherwise to demand strict compliance with that provision or any
other provision of this Agreement.  No
prior waiver by Lender, nor any course of dealing between Lender and Grantor,
shall constitute a waiver of any of Lender’s rights or of any of Grantor’s
obligations as to any future transactions. 
Whenever the consent of Lender is required under this Agreement, the
granting of such consent by Lender in any instance shall not constitute
continuing consent to subsequent instances where such consent is required and
in all cases such consent may be granted or withheld in the sole discretion of
Lender.

 

Notices.  Any notice required to be given under this
Agreement shall be given in writing, and shall be effective when actually
delivered, when actually received by telefacsimile (unless otherwise required
by law), when deposited with a nationally recognized overnight courier, or, if
mailed, when deposited in the United States mail, as first class, certified or
registered mail postage prepaid, directed to the addresses shown near the beginning
of this Agreement.  Any party may change
its address for notices under this Agreement by giving formal written notice to
the other parties, specifying that the purpose of the notice is to change the
party’s address.  For notice purposes,
Grantor agrees to keep Lender informed at all times of Grantor’s current
address.  Unless otherwise provided or
required by law, if there is more than one Grantor, any notice given by Lender
to any Grantor is deemed to be notice given to all Grantors.

 

Power of Attorney.  Grantor hereby appoints Lender as Grantor’s
irrevocable attorney-in-fact for the purpose of executing any documents
necessary to perfect, amend, or to continue the security interest granted in
this Agreement or to demand termination of filings of other secured
parties.  Lender may at any time, and
without further authorization from Grantor, file a carbon, photographic or
other reproduction of any financing statement or of this Agreement for use as a
financing statement.  Grantor will
reimburse Lender for all expenses for the perfection and the continuation of
the perfection of Lender’s security interest in the Collateral.

 

Severability.  If a court of competent jurisdiction finds
any provision of this Agreement to be illegal, invalid, or unenforceable as to
any circumstance, that finding shall not make the offending provision illegal,
invalid, or unenforceable as to any other circumstance.  If feasible, the offending provision shall be
considered modified so that it becomes legal, valid and enforceable.  If the offending provision cannot be so
modified, it shall be considered deleted from this Agreement.  Unless otherwise required by law, the
illegality, invalidity, or unenforceability of any provision of this Agreement
shall not affect the legality, validity or enforceability of any other
provision of this Agreement.

 

Successors and Assigns.  Subject to any limitations stated in this
Agreement on transfer of Grantor’s interest, this Agreement shall be binding
upon and inure to the benefit of the parties, their successors and
assigns.  If ownership of the Collateral
becomes vested in a person other than Grantor, Lender, without notice to
Grantor, may deal with Grantor’s successors with reference to this Agreement
and the Indebtedness by way of forbearance or extension without releasing
Grantor from the obligations of this Agreement or liability under the
Indebtedness.

 

Survival of Representations and Warranties.  All representations, warranties, and
agreements made by Grantor in this Agreement shall survive the execution and
delivery of this Agreement, shall be continuing in nature, and shall remain in
full force and effect until such time as Borrower’s Indebtedness shall be paid
in full.

 

Time is of the Essence.  Time is of the essence in the performance of
this Agreement.

 

Waive Jury.  All
parties to this Agreement hereby waive the right to any jury trial in any
action, proceeding, or counterclaim brought by any party against any other
party.

 

 

DEFINITIONS.  The following capitalized words and terms shall
have the following meanings when used in this Agreement.  Unless specifically stated to the contrary,
all references to dollar amounts shall mean amounts in lawful money of the
United States of America.  Words and
terms used in the singular shall include the plural, and the plural shall
include the singular, as the context may require.  Words and terms not otherwise defined in this
Agreement shall have the meanings attributed to such terms in the Uniform
Commercial Code:

 

Agreement.  The word “Agreement” means this Commercial
Security Agreement, as this Commercial Security Agreement may be amended or
modified from time to time, together with all exhibits and schedules attached
to this Commercial Security Agreement from time to time.

 

Borrower.  The word “Borrower” means STARTEK, INC.;
STARTEK USA, INC. and STARTEK CANADA SERVICES, LTD. and includes all co-signers
and co-makers signing the Note and all their successors and assigns.

 

Collateral.  The word “Collateral” means all of Grantor’s
right, title and interest in and to all the Collateral as described in the
Collateral Description section of this Agreement.

 

Default.  The word “Default” means the Default set
forth in this Agreement in the section titled “Default”.

 

Environmental Laws.  The words “Environmental Laws” mean any and
all state, federal and local statutes, regulations and ordinances relating to
the protection of human health or the environment, including without limitation
the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended, 42 U.S.C. Section 9601, et seq. (“CERCLA”), the
Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499 (“SARA”),
the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et
seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901,
et seq., or other applicable state or federal laws, rules, or regulations
adopted pursuant thereto.

 

Event of Default.  The words “Event of Default” mean any of the
events of default set forth in this Agreement in the Default section of this
Agreement.

 

Grantor.  The word “Grantor” means STARTEK, INC.

 

Guaranty.  The word “Guaranty” means the guaranty from
guarantor, endorser, surety, or accommodation party to Lender, including
without limitation a guaranty of all or part of the Note.

 

Hazardous Substances.  The words “Hazardous Substances” mean
materials that, because of their quantity, concentration or physical, chemical
or infectious characteristics, may cause or pose a present or potential hazard
to human health or the environment when improperly used, treated, stored,
disposed of, generated, manufactured, transported or otherwise handled.  The words “Hazardous Substances” are used in
their very broadest sense and include without limitation any and all hazardous
or toxic substances, materials or waste as defined by or listed under the
Environmental Laws.  The term “Hazardous
Substances” also includes, without limitation, petroleum and petroleum
by-products or any fraction thereof and asbestos.

 

Indebtedness.  The word “Indebtedness” means the
indebtedness evidenced by the Note or Related Documents, including all
principal and interest together with all other indebtedness and costs and
expenses for which Grantor is responsible under this Agreement or under any of the
Related Documents and (a) the payment of Grantor’s obligations (whether
joint, several or otherwise) to Lender as evidenced by any other note(s) or
other evidence of indebtedness executed by such Grantor and all amendments,
modifications, renewals, extensions and substitutions thereof and all
subsequent notes of greater or lesser amounts payable or assigned to Lender; (b) the
performance of each Debtor’s obligations under this security agreement (“Agreement”);
and (c) the payment of any and all other indebtedness, direct or indirect,
mature or unmatured or contingent, joint or several now or hereafter owed to
Secured Party by each Debtor, including (without limitation) indebtedness
unrelated or dissimilar to any indebtedness in 
existence or contemplated by any Debtor at the time this Agreement was
executed or at the time such indebtedness is incurred..

 

Lender.  The
word “Lender” means UMB BANK COLORADO, n.a., its successors and assigns.

 

Note.  The
word “Note” means the Note executed by STARTEK, INC.; and STARTEK USA, INC. in
the principal amount of $15,000,000.00 dated June 26, 2009, together with
all renewals of, extensions of, modifications of, refinancings of,
consolidations of, and substitutions for the note or credit agreement.

 

Property.  The word “Property” means all of Grantor’s
right, title and interest in and to all the Property as described in the “Collateral
Description” section of this Agreement.

 

Related Documents.  The words “Related Documents” mean all
promissory notes, credit agreements, loan agreements, environmental agreements,
guaranties, security agreements, mortgages, deeds of trust, security deeds,
collateral mortgages, and all other instruments, agreements and documents,
whether now or hereafter existing, executed in connection with the
Indebtedness.

 

BORROWER AND
GRANTOR HAVE READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS COMMERCIAL SECURITY
AGREEMENT AND AGREE TO ITS TERMS. THIS AGREEMENT IS DATED JUNE 26, 2009.

 

GRANTOR:

 

 

STARTEK,
INC.

 

	
  By:

  	
  /s/ A.
  LAURENCE JONES

  	
   

  	
  By:

  	
  /s/ DAVID
  G. DURHAM

  
	
  A.
  Laurence Jones, Chief Exec. Officer/Pres. of

  	
  David G.
  Durham, Exec. VP/CFO/Treasurer of

  
	
  STARTEK,
  INC.

  	
  STARTEK,
  INC.

  

 

BORROWER:

 

 

STARTEK,
INC.

 

	
  By:

  	
  /s/ A.
  LAURENCE JONES

  	
   

  	
  By:

  	
  /s/ DAVID
  G. DURHAM

  
	
  A.
  Laurence Jones, Chief Exec. Officer/Pres. of

  	
   

  	
  David G.
  Durham, Exec. VP/CFO/Treasurer of 

  
	
  STARTEK,
  INC.

  	
   

  	
  STARTEK,
  INC.

  

 

 

STARTEK USA,
INC.

 

	
  By:

  	
  /s/ A.
  LAURENCE JONES

  	
   

  	
  By:

  	
  /s/ DAVID
  G. DURHAM

  
	
  A.
  Laurence Jones, Chief Exe. Officer/Pres. of 

  	
   

  	
  David G.
  Durham, Exec VP/CFO/Treasurer of 

  
	
  STARTEK USA,
  INC.

  	
   

  	
  STARTEK USA,
  INC.

  

 

 

STARTEK
CANADA SERVICES, LTD.

 

	
  By:

  	
  /s/ A.
  LAURENCE JONES

  	
   

  	
  By: 

  	
  /s/ DAVID
  G. DURHAM

  
	
  A.
  Laurence Jones, Chief Exec. Officer/Pres. of

  	
   

  	
  David G.
  Durham, Exec. VP/CFO/Treasurer of

  
	
  STARTEK
  CANADA SERVICES, LTD.

  	
   

  	
  STARTEK
  CANADA SERVICES, LTD.

  

 

LASER PRO Lending, Ver. 5.44.00.002 
Copr. Harland Financial Solutions, Inc. 1997, 2009.  All Rights Reserved.  — CO 
S:\APPS\hfs\CFI\LPL\E40.FC 
TR-62141  PR-63 (M)

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