CONTINUING
SECURITY AGREEMENT:
RIGHTS TO PAYMENT
1. GRANT OF SECURITY
INTEREST. For valuable consideration, the undersigned STARTEK USA,
INC., or any of them (“Debtor”), hereby grants and
transfers to WELLS FARGO BANK, NATIONAL ASSOCIATION
(“Bank”) a security interest in all accounts, deposit
accounts, chattel paper (whether electronic or tangible),
instruments, promissory notes, documents, general intangibles,
payment intangibles, software, letter of credit rights, health-care
insurance receivables and other rights to payment (collectively
called “Collateral”), now existing or at any time
hereafter, and prior to the termination hereof, arising (whether
they arise from the sale, lease or other disposition of inventory
or from performance of contracts for service, manufacture,
construction, repair or otherwise or from any other source
whatsoever), including all securities, guaranties, warranties,
indemnity agreements, insurance policies, supporting obligations
and other agreements pertaining to the same or the property
described therein, and in all goods returned by or repossessed from
Debtor’s customers, together with whatever is receivable or
received when any of the Collateral or proceeds thereof are sold,
collected, exchanged or otherwise disposed of, whether such
disposition is voluntary or involuntary, including without
limitation, all rights to payment, including returned premiums,
with respect to any insurance relating to any of the foregoing, and
all rights to payment with respect to any claim or cause of action
affecting or relating to any of the foregoing (hereinafter called
“Proceeds”).
2. OBLIGATIONS
SECURED. The obligations secured hereby are the payment and
performance of: (a) all present and future Indebtedness of
Debtor to Bank; (b) all obligations of Debtor and rights of
Bank under this Agreement; and (c) all present and future
obligations of Debtor to Bank of other kinds. The word
“Indebtedness” is used herein in its most comprehensive
sense and includes any and all advances, debts, obligations and
liabilities of Debtor, or any of them, heretofore, now or hereafter
made, incurred or created, whether voluntary or involuntary and
however arising, whether due or not due, absolute or contingent,
liquidated or unliquidated, determined or undetermined, including
under any swap, derivative, foreign exchange, hedge, deposit,
treasury management or other similar transaction or arrangement,
and whether Debtor may be liable individually or jointly with
others, or whether recovery upon such Indebtedness may be or
hereafter becomes unenforceable.
3. TERMINATION. This
Agreement will terminate upon the performance of all obligations of
Debtor to Bank, including without limitation, the payment of all
Indebtedness of Debtor to Bank, and the termination of all
commitments of Bank to extend credit to Debtor, existing at the
time Bank receives written notice from Debtor of the termination of
this Agreement.
4. OBLIGATIONS OF
BANK. Bank has no obligation to make any loans hereunder. Any money
received by Bank in respect of the Collateral may be deposited, at
Bank’s option, into a non-interest bearing account over which
Debtor shall have no control, and the same shall, for all purposes,
be deemed Collateral hereunder.
5. REPRESENTATIONS
AND WARRANTIES. Debtor represents and warrants to Bank that:
(a) Debtor’s legal name is exactly as set forth on the
first page of this Agreement, and all of Debtor’s
organizational documents or agreements delivered to Bank are
complete and accurate in every respect; (b) Debtor is the
owner and has possession or control of the Collateral and Proceeds;
(c) Debtor has the exclusive right to grant a security interest in
the Collateral and Proceeds; (d) all Collateral and Proceeds
are genuine, free from liens, adverse claims, setoffs, default,
prepayment, defenses and conditions precedent of any kind or
character, except the lien created hereby or as otherwise agreed to
by Bank, or as heretofore disclosed by Debtor to Bank, in writing;
(e) all statements contained herein and, where applicable, in
the Collateral are true and complete in all material respects;
(f) no financing statement covering any of the Collateral or
Proceeds, and naming any secured party other than Bank, is on file
in any public office; (g) all persons appearing to be
obligated on Collateral and Proceeds have authority and capacity to
contract and are bound as they appear to be; (h) all property
subject to chattel paper has been properly registered and filed in
compliance with law and to perfect the interest of Debtor in such
property; and (i) all Collateral and Proceeds comply with all
applicable laws concerning form, content and manner of preparation
and execution, including where applicable Federal Reserve
Regulation Z and any State consumer credit laws.
(a) Debtor agrees in
general: (i) to pay Indebtedness secured hereby when due;
(ii) to indemnify Bank against all losses, claims, demands,
liabilities and expenses of every kind caused by property subject
hereto; (iii) to permit Bank to exercise its powers;
(iv) to execute and deliver such documents as Bank deems
necessary to create, perfect and continue the security interests
contemplated hereby; (v) not to change its name, and as
applicable, its chief executive office, its principal residence or
the jurisdiction in which it is organized and/or registered without
giving Bank prior written notice thereof; (vi) not to change
the places where Debtor keeps any Collateral or Debtor’s
records concerning the Collateral and Proceeds without giving Bank
prior written notice of the address to which Debtor is moving same;
and (vii) to cooperate with Bank in perfecting all security
interests granted herein and in obtaining such agreements from
third parties as Bank deems necessary, proper or convenient in
connection with the preservation, perfection or enforcement of any
of its rights hereunder.
(b) Debtor agrees
with regard to the Collateral and Proceeds, unless Bank agrees
otherwise in writing: (i) that Bank is authorized to file
financing statements in the name of Debtor to perfect Bank’s
security interest in Collateral and Proceeds; (ii) where
applicable, to insure the Collateral with Bank named as loss payee,
in form, substance and amounts, under agreements, against risks and
liabilities, and with insurance companies satisfactory to Bank;
(iii) not to permit any lien on the Collateral or Proceeds,
except in favor of Bank; (iv) not to sell, hypothecate or
otherwise dispose of, nor permit the transfer by operation of law
of, any of the Collateral or Proceeds or any interest therein;
(v) to keep, in accordance with generally accepted accounting
principles, complete and accurate records regarding all Collateral
and Proceeds, and to permit Bank to inspect the same and make
copies thereof at any reasonable time; (vi) if requested by
Bank, to receive and use reasonable diligence to collect Proceeds,
in trust and as the property of Bank, and to immediately endorse as
appropriate and deliver such Proceeds to Bank daily in the exact
form in which they are received together with a collection report
in form satisfactory to Bank; (vii) not to commingle
Collateral or Proceeds, or collections thereunder, with other
property; (viii) to give only normal allowances and credits
and to advise Bank thereof immediately in writing if they affect
any Collateral or Proceeds in any material respect; (ix) on
demand, to deliver to Bank returned property resulting from, or
payment equal to, such allowances or credits on any Collateral or
Proceeds or to execute such documents and to do such other things
as Bank may reasonably request for the purpose of perfecting,
preserving and enforcing its security interest in such returned
property; (x) from time to time, when requested by Bank, to
prepare and deliver a schedule of all Collateral and Proceeds
subject to this Agreement and to assign in writing and deliver to
Bank all accounts, contracts, leases and other chattel paper,
instruments, documents and other evidences thereof; (xi) not to
allow any financing statement covering any of Debtor’s
inventory or proceeds thereof to be on file in any public office
without Bank’s prior written consent; (xii) in the event
Bank elects to receive payments of Collateral or Proceeds
hereunder, to pay all expenses incurred by Bank in connection
therewith, including expenses of accounting, correspondence,
collection efforts, reporting t
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