Exhibit No

Exhibit 10.2

CONTINUING GUARANTY

Borrower:		PeopleSupport, Inc.
Guarantor:		PeopleSupport (Philippines), Inc. a Philippines corporation, STC Solutions, Inc., a Delaware corporation, ProArm Management, Inc., a Delaware corporation, PeopleSupport Rapidtext, Inc., a Delaware corporation, The Transcription Company, a California corporation, and PeopleSupport (Costa Rica), S.R.L., a Costa Rican entity
Date:		July 28, 2006

     This Continuing Guaranty (this “Guaranty”) is executed by the above-named guarantor (“Guarantor”), as of the above date, in favor of CITIBANK (WEST), FSB (“Bank”), with offices at 201 West Lexington, 4^th Floor, Glendale, California 91203, with respect to the Indebtedness (as hereinafter defined) of the above-named borrower (“Borrower”).

     1. Continuing Guaranty. Guarantor hereby unconditionally guarantees and promises to pay on demand to Bank, at the address indicated above, or at such other address as Bank may direct, in lawful money of the United States, and to perform for the benefit of Bank, as and for Guarantor’s own debt, all Indebtedness of Borrower now or hereafter owing to or held by Bank, until the Indebtedness has been indefeasibly paid in full in accordance with Section 12 hereof. As used herein, the term “Indebtedness” is used in its most comprehensive sense and shall mean and include without limitation: (a) any and all debts, duties, obligations, liabilities, representations, warranties and guaranties of Borrower heretofore, now, or hereafter made, incurred, or created in connection with that certain Business Loan Agreement between Borrower and Bank of even date herewith (the “Loan Agreement”) or in connection with a foreign exchange facility between Borrower and Bank (the “F/X Facility”), whether directly to Bank or acquired by Bank by assignment or otherwise, or held by Bank on behalf of others, however arising, whether voluntary or involuntary, due or not due, absolute or contingent, liquidated or unliquidated, certain or uncertain, determined or undetermined, monetary or nonmonetary, written or oral, and whether Borrower may be liable individually or jointly with others, and regardless of whether recovery thereon may be or hereafter become barred by any statute of limitations, discharged or uncollectible in any bankruptcy, insolvency or other proceeding, or otherwise unenforceable; and (b) any and all amendments, modifications, renewals and extensions of any or all of the foregoing, including without limitation amendments, modifications, renewals and extensions which are evidenced by any new or additional instruments, documents or agreements; and (c) any and all reasonable attorneys’ fees of outside counsel, court costs, and collection charges incurred in endeavoring to collect or enforce any of the foregoing against Borrower (to the extent owed by Borrower pursuant to the terms of the Loan Agreement or an F/X Facility), Guarantor (to the extent owed by Guarantor pursuant to the terms of this Guaranty) or any other person liable thereon (whether or not suit be brought) and any other expenses of, for or incidental to collection thereof. As used herein, the term “Borrower” shall include any successor to the business and assets of Borrower, and shall also

include Borrower in its capacity as a debtor or debtor in possession under the federal Bankruptcy Code, and any trustee, custodian or receiver for Borrower or any of its assets, should Borrower hereafter become the subject of any bankruptcy or insolvency proceeding, voluntary or involuntary; and all indebtedness, liabilities and obligations incurred by any such person in connection with the Loan Agreement or an F/X Facility shall be included in the Indebtedness guaranteed hereby. This Guaranty is given in consideration for credit and other financial accommodations which may, from time to time, be given by Bank to Borrower pursuant to the Loan Agreement and/or an F/X Facility, but Guarantor acknowledges and agrees that acceptance by Bank of this Guaranty shall not constitute a commitment of any kind by Bank to extend such credit or other financial accommodation to Borrower or to permit Borrower to incur Indebtedness to Bank.

     2. Performance Under This Guaranty. In the event that Borrower fails to make any payment of any Indebtedness on or before the due date thereof, or perform, keep, observe or fulfill any obligation, agreement or covenant included in the Indebtedness on or before the due date thereof, Guarantor immediately shall cause such Indebtedness to by paid, performed, kept, observed, or fulfilled, as the case may be.

     3. Waivers. Guarantor hereby waives: (a) presentment for payment, notice of dishonor, demand, protest, and notice thereof as to any instrument, and all other notices and demands to which Guarantor might be entitled, including without limitation notice of all of the following: the acceptance hereof; the creation, existence, or acquisition of any Indebtedness; the amount of the Indebtedness from time to time outstanding; any foreclosure sale or other disposition of any property which secures any or all of the Indebtedness or which secures the obligations of any other guarantor of any or all of the Indebtedness; any adverse change in Borrower’s financial position; any other fact which might increase Guarantor’s risk; any default, partial payment or non-payment of all or any part of the Indebtedness; the occurrence of any other Event of Default (as hereinafter defined); any and all agreements and arrangements between Bank and Borrower and any changes, modifications, or extensions thereof, and any revocation, modification or release of any guaranty of any or all of the Indebtedness by any person (including without limitation any other person signing this Guaranty); (b) any right to require Bank to institute suit against, or to exhaust its rights and remedies against, Borrower or any other person, or to proceed against any property of any kind which secures all or any part of the Indebtedness, or to exercise any right of offset or other right with respect to any reserves, credits or deposit accounts held by or maintained with Bank or any indebtedness of Bank to Borrower, or to exercise any other right or power, or pursue any other remedy Bank may have; (c) any defense arising by reason of any disability or other defense of Borrower or any other guarantor or any endorser, co-maker or other person, or by reason of the cessation from any cause whatsoever of any liability of Borrower or any other guarantor or any endorser, co-maker or other person, with respect to all or any part of the Indebtedness, or by reason of any act or omission of Bank or others which directly or indirectly results in the discharge or release of Borrower or any other guarantor or any other person or any Indebtedness or any security therefor, whether by operation of law or otherwise; (d) any defense arising by reason of any failure of Bank to obtain, perfect, maintain or keep in force any security interest in, or lien or encumbrance upon, any property of Borrower or any other person; (e) any defense based upon
any failure of Bank to give Guarantor notice of any sale or other disposition of any property

securing any or all of the Indebtedness, or any defects in any such notice that may be given, or any failure of Bank to comply with any provision of applicable law in enforcing any security interest in or lien upon any property securing any or all of the Indebtedness including, but not limited to, any failure by Bank to dispose of any property securing any or all of the Indebtedness in a commercially reasonable manner; (f) any defense based upon or arising out of any bankruptcy, insolvency, reorganization, arrangement, readjustment of debt, liquidation or dissolution proceeding commenced by or against Borrower or any other guarantor or any endorser, co-maker or other person, including without limitation any discharge of, or bar against collecting, any of the Indebtedness (including without limitation any interest thereon), in or as a result of any such proceeding; and (g) the benefit of any and all statutes of limitation with respect to any action based upon, arising out of or related to this Guaranty. Until all of the Indebtedness has been paid, performed, and discharged in full, nothing shall discharge or satisfy the liability of Guarantor hereunder except the full performance and payment of all of the Indebtedness. If any claim is ever made upon Bank for repayment or recovery of any amount or amounts received by Bank in payment of or on account of any of the Indebtedness, because of any claim that any such payment constituted a preferential transfer or fraudulent conveyance, or for any other reason whatsoever, and Bank repays all or part of said amount by reason of any judgment, decree or order of any court or administrative body having jurisdiction over Bank or any of its property, or by reason of any settlement or compromise of any such claim effected by Bank with any such claimant (including without limitation the Borrower), then and in any such event, Guarantor agrees that any such judgment, decree, order, settlement and compromise shall be binding upon Guarantor, notwithstanding any revocation or release of this Guaranty or the cancellation of any note or other instrument evidencing any of the Indebtedness, or any release of any of the Indebtedness, and Guarantor shall be and remain liable to Bank under this Guaranty for the amount so repaid or recovered, to the same extent as if such amount had never originally been received by Bank, and the provisions of this sentence shall survive, and continue in effect, notwithstanding any revocation or release of this Guaranty. Guarantor hereby expressly and unconditionally waives all rights of subrogation, reimbursement and indemnity of every kind against Borrower, and all rights of recourse to any assets or property of Borrower, and all rights to any collateral or security held for the payment and performance of any Indebtedness, including (but not limited to) any of the foregoing rights which Guarantor may have under any present or future document or agreement with any Borrower or other person, and including (but not limited to) any of the foregoing rights which Guarantor may have under any equitable doctrine of subrogation, implied contract, or unjust enrichment, or any other equitable or legal doctrine. Neither Bank, nor any of its directors, officers, employees, agents, attorneys or any other person affiliated with or representing Bank shall be liable for any claims, demands, losses or damages, of any kind whatsoever, made, claimed, incurred or suffered by Guarantor or any other party through the ordinary negligence of Bank, or any of its directors, officers, employees, agents, attorneys or any other person affiliated with or representing Bank.

     4. Consents. Guarantor hereby consents and agrees that, without notice to or by Guarantor and without affecting or impairing in any way the obligations or liability of Guarantor hereunder, Bank may, from time to time before or after revocation of this Guaranty, do any one or more of the following in Bank’s sole and absolute discretion: (a) accelerate, accept partial payments of, compromise or settle, renew, extend the time for the payment, discharge, or performance of, refuse to enforce, and release all or any parties to, any or all of the Indebtedness;

(b) grant any other indulgence to Borrower or any other person in respect of any or all of the Indebtedness or any other matter; (c) accept, release, waive, surrender, enforce, exchange, modify, impair, or extend the time for the performance, discharge, or payment of, any and all property of any kind securing any or all of the Indebtedness or any guaranty of any or all of the Indebtedness, or on which Bank at any time may have a lien, or refuse to enforce its rights or make any compromise or settlement or agreement therefor in respect of any or all of such property; (d) substitute or add, or take any action or omit to take any action which results in the release of, any one or more endorsers or guarantors of all or any part of the Indebtedness, including, without limitation one or more parties to this Guaranty, regardless of any destruction or impairment of any right of contribution or other right of Guarantor; (e) amend, alter or change in any respect whatsoever any term or provision relating to any or all of the Indebtedness, including the rate of interest thereon; (f) apply any sums received from Borrower, any other guarantor, endorser, or co-signer, or from the disposition of any collateral or security, to any indebtedness whatsoever owing from such person or secured by such collateral or security, in such manner and order as Bank determines in its sole discretion, and regardless of whether such indebtedness is part of the Indebtedness, is secured, or is due and payable; (g) apply any sums received from Guarantor or from the disposition of any collateral or security securing the obligations of Guarantor, to any of the Indebtedness in such manner and order as Bank determines in its sole discretion, regardless of whether or not such Indebtedness is secured or is due and payable. Guarantor consents and agrees that Bank shall be under no obligation to marshal any assets in favor of Guarantor, or against or in payment of any or all of the Indebtedness. Guarantor further consents and agrees that Bank shall have no duties or responsibilities whatsoever with respect to any property securing any or all of the Indebtedness. Without limiting the generality of the foregoing, Bank shall have no obligation to monitor, verify, audit, examine, or obtain or maintain any insurance with respect to, any property securing any or all of the Indebtedness.

     5. Account Stated. Bank’s books and records showing the account between it and the Borrower shall be admissible in evidence in any action or proceeding as prima facie proof of the items therein set forth. Bank’s statements rendered to Borrower shall be binding upon Guarantor (whether or not Guarantor receives copies thereof), and shall constitute an account stated between Bank and Borrower, unless Bank receives a written statement of Borrower’s exceptions within 30 days after the statement was mailed to Borrower. Guarantor assumes full responsibility for obtaining copies of such monthly statements from Borrower, if Guarantor desires such copies.

     6. Exercise of Rights and Remedies; Foreclosure of Trust Deeds. Guarantor consents and agrees that, without notice to or by Guarantor and without affecting or impairing in any way the obligations or liability of Guarantor hereunder, Bank may, from time to time, exercise any right or remedy it may have with respect to any or all of the Indebtedness or any property securing any or all of the Indebtedness or any guaranty thereof, including without limitation, judicial foreclosure, nonjudicial foreclosure, exercise of a power of sale, and taking a deed, assignment or transfer in lieu of foreclosure as to any such property, and Guarantor expressly waives any defense based upon the exercise of any such right or remedy, notwithstanding the effect thereof upon any of Guarantor’s rights, including without limitation, any destruction of Guarantor’s right of subrogation against Borrower and any destruction of

Guarantor’s right of contribution or other right against any other guarantor of any or all of the Indebtedness or against any other person, whether by operation of Sections 580a, 580d or 726 of the California Code of Civil Procedure, or any comparable provisions of the laws of any other jurisdiction, or any other statutes or rules of law now or hereafter in effect, or otherwise. Pursuant to Section 2856 of the California Civil Code, Guarantor waives all rights and defenses that Guarantor may have because the Indebtedness is secured by real property. This means, among other things: (a) Bank may collect from Guarantor without first foreclosing on any real or personal property collateral pledged by Borrower or any other guarantor; and (b) if Bank forecloses on any real property collateral pledged by Borrower or any other guarantor: (i) the amount of the Indebtedness may be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale price; and (ii) Bank may collect from Guarantor even if Bank, by foreclosing on such real property collateral, has destroyed any right Guarantor may have to collect from Borrower or such other guarantor. This is an unconditional and irrevocable waiver of any rights and defenses Guarantor may have because the Indebtedness is secured by real property. These rights and defenses include, but are not limited to, any rights or defenses based upon Section 580a, 580b, 580d, or 726 of the California Code of Civil Procedure.

     7. Right to Attachment Remedy. Guarantor agrees that, notwithstanding the existence of any property securing any or all of the Indebtedness, Bank shall have all of the rights of an unsecured creditor of Guarantor, including without limitation the right to obtain a temporary protective order and writ of attachment against Guarantor with respect to any sums due under this Guaranty. Guarantor further agrees that in the event any property secures the obligations of Guarantor under this Guaranty, to the extent that Bank, in its sole and absolute discretion, determines prior to the disposition of such property that the amount to be realized by Bank therefrom may be less than the indebtedness of the Guarantor under this Guaranty, Bank shall have all the rights of an unsecured creditor against Guarantor, including without limitation the right of Bank, prior to the disposition of said property, to obtain a temporary protective order and writ of attachment against Guarantor. Guarantor waives the benefit of Section 483.010(b) of the California Code of Civil Procedure and of any and all other statutes and rules of law now or hereafter in effect requiring Bank to first resort to or exhaust all such collateral before seeking or obtaining any attachment remedy against Guarantor. Bank shall have no liability to Guarantor as a result thereof, whether or not the actual deficiency realized by Bank is less than the anticipated deficiency on the basis of which Bank obtains a temporary protective order or writ of attachment.

     8. Indemnity. Guarantor hereby agrees to indemnify Bank and hold Bank harmless from and against any and all claims, debts, liabilities, demands, obligations, actions, causes of action, penalties, costs and expenses (including without limitation reasonable attorneys’ fees of outside counsel), of every nature, character and description, which relate to the transactions contemplated by the Loan Agreement or an F/X Facility, and Bank may sustain or incur based upon or arising out of any of the Indebtedness, any actual or alleged failure to collect and pay over any withholding or other tax relating to Borrower or its employees, any relationship or agreement between Bank and Borrower, any actual or alleged failure of Bank to comply with any writ of attachment or other legal process relating to Borrower or any of its property, or any other matter, cause or thing whatsoever occurred, done, omitted or suffered to be done by Bank relating in any way to Borrower or the Indebtedness (except any such amounts sustained or

incurred as the result of the gross negligence or willful misconduct of Bank or any of its directors, officers, employees, agents, attorneys, or any other person affiliated with or representing Bank). Notwithstanding any provision in this Guaranty to the contrary, the indemnity agreement set forth in this Section shall survive any termination or revocation of this Guaranty and shall for all purposes continue in full force and effect.

     9. Subordination. Any and all rights of Guarantor under any and all debts, liabilities and obligations owing from Borrower to Guarantor, including any security for and guaranties of any such obligations, whether now existing or hereafter arising, are hereby subordinated in right of payment to the prior payment in full of all of the Indebtedness. No payment in respect of any such subordinated obligations shall at any time be made to or accepted by Guarantor if at the time of such payment any Indebtedness is outstanding. If any Event of Default has occurred, Borrower and any assignee, trustee in bankruptcy, receiver, or any other person having custody or control over any or all of Borrower’s property are hereby authorized and directed to pay to Lender the entire unpaid balance of the Indebtedness before making any payments whatsoever to Guarantor, whether as a creditor, shareholder, or otherwise; and insofar as may be necessary for that purpose, Guarantor hereby assigns and transfers to Lender all rights to any and all debts, liabilities and obligations owing from Borrower to Guarantor, including any security for and guaranties of any such obligations, whether now existing or hereafter arising, including without limitation any payments, dividends or distributions out of the business or assets of Borrower. Any amounts received by Guarantor in violation of the foregoing provisions shall be received and held as trustee for the benefit of Lender and shall forthwith be paid over to Lender to be applied to the Indebtedness in such order and sequence as Lender shall in its sole discretion determine, without limiting or affecting any other right or remedy which Lender may have hereunder or otherwise and without otherwise affecting the liability of Guarantor hereunder. Guarantor hereby expressly waives any right to set-off or assert any counterclaim against Borrower.

     10. Continuing Guaranty. This Guaranty includes Indebtedness arising under successive transactions continuing, compromising, extending, increasing, modifying, releasing, or renewing the Indebtedness, changing the interest rate, payment terms, or other terms and conditions thereof, or creating new or additional Indebtedness after prior Indebtedness has been satisfied in whole or in part. Guarantor hereby waives and agrees not to assert any right Guarantor has under Section 2815 of the California Civil Code, or otherwise, to revoke this Guaranty as to future Indebtedness.

     11. Independent and Primary Liability. This Guaranty is a primary and original obligation of Guarantor, is not merely the creation of a surety relationship, and is an absolute, unconditional, and continuing guaranty of payment and performance which shall remain in full force and effect without respect to future changes in conditions, including any change of law or any invalidity or irregularity with respect to any of the agreements between Borrower and Bank. Guarantor agrees that Guarantor is severally and not jointly and severally liable, with any other guarantor of the Indebtedness, to Bank, to the extent set forth in Section 2 hereof, that the obligations of Guarantor hereunder are independent of the obligations of Borrower or any other guarantor, and that a separate action may be brought against Guarantor whether such action is brought against Borrower or any other guarantor or whether Borrower or any such other

guarantor is joined in such action. Guarantor agrees that Guarantor’s liability hereunder shall be immediate and shall not be contingent upon the exercise or enforcement by Bank of whatever remedies it may have against Borrower or any other guarantor, or the enforcement of any lien or realization upon any security Bank may at any time possess. Guarantor agrees that any release which may be given by Bank to Borrower or any other guarantor shall not release Guarantor. The liability of Guarantor hereunder shall not be affected, revoked, impaired, or reduced by any one or more of the following: (a) any direction as to the application of payment by Borrower or by any other party; or (b) any other continuing or restrictive guaranty or undertaking or any limitation on the liability of any other guarantor (whether under this Guaranty or under any other agreement); or (c) any payment on or reduction of any such other guaranty or undertaking; or (d) any revocation, amendment, modification or release of any such other guaranty or undertaking; or (e) any dissolution or termination of, or increase, decrease, or change in membership of Guarantor, in the event that Guarantor is a partnership. Guarantor hereby expressly represents that he was not induced to give this Guaranty by the fact that there are or may be other guarantors either under this Guaranty or otherwise, and Guarantor agrees that any release of any one or more of such other guarantors shall not release Guarantor from his obligations hereunder either in full or to any lesser extent.

     12. Indefeasible Payment. The Indebtedness shall not be considered indefeasibly paid for purposes of this Guaranty unless and until all payments to Bank are no longer subject to any right on the part of any person, including Borrower, Borrower as a debtor in possession, or any trustee (whether appointed under the Bankruptcy Code or otherwise) of any of Borrower’s assets, to invalidate or set aside such payments or to seek to recoup the amount of such payments or any portion thereof, or to declare same to be fraudulent or preferential. In the event that, for any reason, any portion of such payments to Bank is set aside or restored, whether voluntarily or involuntarily, after the making thereof, then the obligation intended to be satisfied thereby shall be revived and continued in full force and effect as if said payment or payments had not been made, and Guarantor shall be liable for the full amount Bank is required to repay plus any and all costs and expenses (including reasonable attorneys’ fees or outside counsel and expenses and reasonable attorneys’ fees of outside counsel and expenses incurred pursuant to proceedings arising under the Bankruptcy Code) paid by Bank in connection therewith.

     13. Financial Condition of Borrower. Guarantor is fully aware of the financial condition of Borrower and is executing and delivering this Guaranty at Borrower’s request and based solely upon his own independent investigation of all matters pertinent hereto, and Guarantor is not relying in any manner upon any representation or statement of Bank with respect thereto. Guarantor represents and warrants that he is in a position to obtain, and Guarantor hereby assumes full responsibility for obtaining, any additional information concerning Borrower’s financial condition and any other matter pertinent hereto as Guarantor may desire, and Guarantor is not relying upon or expecting Bank to furnish to him any information now or hereafter in Bank’s possession concerning the same or any other matter. By executing this Guaranty, Guarantor knowingly accepts the full range of risks encompassed within a contract of continuing guaranty, which risks Guarantor acknowledges include without limitation the possibility that Borrower will incur additional Indebtedness for which Guarantor will be liable hereunder after Borrower’s financial condition or ability to pay such Indebtedness has deteriorated and/or after bankruptcy or insolvency proceedings have been commenced by or

against Borrower. Guarantor shall have no right to require Bank to obtain or disclose any information with respect to the Indebtedness, the financial condition or character of Borrower, the existence of any collateral or security for any or all of the Indebtedness, the filing by or against Borrower of any bankruptcy or insolvency proceeding, the existence of any other guaranties of all or any part of the Indebtedness, any action or non-action on the part of Bank, Borrower, or any other person, or any other matter, fact, or occurrence.

     14. Reports and Financial Statements of Guarantor. Guarantor shall, at its sole cost and expense, shall provide Bank (a) signed annual financial statements (on Bank’s form), as soon as available, no later than ninety (90) days after the end of each calendar year, commencing with the calendar year ending December 31, 2006, and (b) after the occurrence of an Event of Default (as defined in the Loan Agreement), such other financial statements and reports concerning Guarantor’s business, financial condition or affairs as Bank may request. Guarantor further agrees immediately to give written notice to Bank of any material adverse change in Guarantor’s financial condition. All reports and information furnished to Bank hereunder shall be complete, accurate and correct in all respects. Whenever requested, Guarantor shall further deliver to Bank a certificate signed by Guarantor (and, if Guarantor is a partnership, by all general partners of Guarantor, in their individual capacities, and, if Guarantor is a corporation, by the president and secretary of Guarantor, in their individual capacities) warranting and representing that all reports, financial statements and other documents and information delivered or caused to be delivered to Bank under this Guaranty, are complete, correct and thoroughly and accurately present the financial condition of Guarantor, and that there exists on the date of delivery of said certificate to Bank no condition or event which constitutes an Event of Default under this Guaranty.

     15. Representations and Warranties. Guarantor hereby represents and warrants to Bank that (i) each Guarantor is the entity type set forth in the description of Guarantor at the top of this Guaranty organized and existing under the laws of the state of country set forth in the description of Guarantor at the top of this Guaranty and has the power and authority to own its own properties and assets, and to transact the business in which it is engaged, and is properly licensed, qualified to do business and in good standing in every jurisdiction where the conduct of its business requires it to be so qualified; (ii) the execution, delivery and performance of this Guaranty are within Guarantor’s powers, are not in conflict with the terms of any charter, bylaw, articles of incorporation or other organization papers of Guarantor, and do not result in a breach of or constitute a default under any contract, obligation, indenture or other instrument to which Guarantor is a party or by which Guarantor is bound or affected; (iii) there is no law, rule or regulation, nor is there any judgment, decree or order of any court or governmental authority binding on Guarantor which would be contravened by the execution, delivery, performance or enforcement of this Guaranty and the other agreements, instruments and documents executed by Guarantor in connection herewith (collectively, with this Guaranty, the “Guarantor Loan Documents”); (iv) Guarantor has taken all trust action necessary to authorize the execution and delivery of the Guarantor Loan Documents, and the consummation of the transactions contemplated hereby and thereby. Upon their execution and delivery in accordance with their respective terms, the Guarantor Loan Documents will constitute legal, valid and binding agreements and obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, except as enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance, and similar laws and equitable principles affecting the enforcement of creditors’

rights generally; (v) no approval, consent, exemption or other action by, or notice to or filing with, any governmental authority is necessary in connection with the execution, delivery, performance or enforcement of the Guarantor Loan Documents; and (vi) it is in Guarantor’s direct interest to assist Borrower in procuring credit, because Borrower is an affiliate of Guarantor, furnishes goods or services to Guarantor, purchases or acquires goods or services from Guarantor, and/or otherwise has a direct or indirect corporate or business relationship with Guarantor.

     16. Costs. Whether or not suit be instituted, Guarantor agrees to reimburse Bank on demand for all reasonable attorneys’ fees of outside counsel and all other costs and expenses incurred by Bank in enforcing this Guaranty, or arising out of or relating in any way to this Guaranty, or in enforcing any of the Indebtedness against Borrower (to the extent such fees or costs are owed by Borrower pursuant to the terms of the Loan agreement or an F/X Facility), Guarantor (to the extent such fees or costs are owed by Guarantor pursuant to the terms of this Guaranty), or any other person, or in connection with any property of any kind securing all or any part of the Indebtedness. Without limiting the generality of the foregoing, and in addition thereto, Guarantor shall reimburse Bank on demand for all reasonable attorneys’ fees of outside counsel and costs Bank incurs in any way relating to Guarantor, Borrower or the Indebtedness, in order to: obtain legal advice; enforce or seek to enforce any of its rights; commence, intervene in, respond to, or defend any action or proceeding; file, prosecute or defend any claim or cause of action in any action or proceeding (including without limitation any probate claim, bankruptcy claim, third-party claim, secured creditor claim, reclamation complaint, and complaint for relief from any stay under the Bankruptcy Code or otherwise); protect, obtain possession of, sell, lease, dispose of or otherwise enforce any security interest in or lien on any property of any kind securing any or all of the Indebtedness; or represent Bank in any litigation with respect to Borrower’s or Guarantor’s affairs. In the event either Bank or Guarantor files any lawsuit against the other predicated on any of the above or on a breach of this Guaranty, the prevailing party in such action shall be entitled to recover its reasonable attorneys’ fees of outside counsel and costs of suit from the non-prevailing party.

     17. Notices. Any notice which a party shall be required or shall desire to give to the other hereunder (except for notice of revocation, which shall be governed by Section 10 of this Guaranty) shall be given by personal delivery or by telecopier or by depositing the same in the United States mail, first class postage pre-paid, addressed to Bank at its address set forth in the heading of this Guaranty and to Guarantor at his address set forth under his signature hereon, and such notices shall be deemed duly given on the date of personal delivery or one day after the date telecopied or 3 business days after the date of mailing as aforesaid. Bank and Guarantor may change their address for purposes of receiving notices hereunder by giving written notice thereof to the other party in accordance herewith. Guarantor shall give Bank immediate written notice of any change in his address.

     18. Claims. Guarantor agrees that any claim or cause of action by Guarantor against Bank, or any of Bank’s directors, officers, employees, agents, accountants or attorneys, based upon, arising from, or relating to this Guaranty, or any other present or future agreement between Bank and Guarantor or between Bank and Borrower, or any other transaction contemplated hereby or thereby or relating hereto or thereto, or any other matter, cause or thing whatsoever,

whether or not relating hereto or thereto, occurred, done, omitted or suffered to be done by Bank, or by Bank’s directors, officers, employees, agents, accountants or attorneys, whether sounding in contract or in tort or otherwise, shall be barred unless asserted by Guarantor by the commencement of an action or proceeding in a court of competent jurisdiction within Los Angeles County, California, by the filing of a complaint within one year after the first act, occurrence or omission upon which such claim or cause of action, or any part thereof, is based and service of a summons and complaint on an officer of Bank or any other person authorized to accept service of process on behalf of Bank, within 30 days thereafter. Guarantor agrees that such one year period is a reasonable and sufficient time for Guarantor to investigate and act upon any such claim or cause of action. The one year period provided herein shall not be waived, tolled, or extended except by a specific written agreement of Bank. This provision shall survive any termination of this Guaranty or any other agreement.

     19. Construction; Severability. If more than one person has executed this Guaranty, the term “Guarantor” as used herein shall be deemed to refer to all and any one or more such persons and their obligations hereunder shall be joint and several. Without limiting the generality of the foregoing, if more than one person has executed this Guaranty, this Guaranty shall in all respects be interpreted as though each person signing this Guaranty had signed a separate Guaranty, and references herein to “other guarantors” or words of similar effect shall include without limitation other persons signing this Guaranty. As used in this Guaranty, the term “property” is used in its most comprehensive sense and shall mean all property of every kind and nature whatsoever, including without limitation real property, personal property, mixed property, tangible property and intangible property. Words used herein in the masculine gender shall include the neuter and feminine gender, words used herein in the neuter gender shall include the masculine and feminine, words used herein in the singular shall include the plural and words used in the plural shall include the singular, wherever the context so reasonably requires. If any provision of this Guaranty or the application thereof to any party or circumstance is held invalid, void, inoperative or unenforceable, the remainder of this Guaranty and the application of such provision to other parties or circumstances shall not be affected thereby, the provisions of this Guaranty being severable in any such instance.

     20. General Provisions. Bank shall have the right to seek recourse against Guarantor to the full extent provided for herein and in any other instrument or agreement evidencing obligations of Guarantor to Bank, and against Borrower to the full extent of the Indebtedness. No election in one form of action or proceeding, or against any party, or on any obligation, shall constitute a waiver of Bank’s right to proceed in any other form of action or proceeding or against any other party. The failure of Bank to enforce any of the provisions of this Guaranty at any time or for any period of time shall not be construed to be a waiver of any such provision or the right thereafter to enforce the same. All remedies hereunder shall be cumulative and shall be in addition to all rights, powers and remedies given to Bank by law or under any other instrument or agreement. Time is of the essence in the performance by Guarantor of each and every obligation under this Guaranty. If Borrower is a corporation, partnership or other entity, Guarantor hereby agrees that Coast shall have no obligation to inquire into the power or authority of Borrower or any of its officers, directors, partners, or agents acting or purporting to act on its behalf, and any Indebtedness made or created in reliance upon the professed exercise of any such power or authority shall be included in the Indebtedness guaranteed hereby. This

Guaranty is the entire and only agreement between Guarantor and Bank with respect to the guaranty of the Indebtedness of Borrower by Guarantor, and all representations, warranties, agreements, or undertakings heretofore or contemporaneously made, which are not set forth herein, are superseded hereby. No course of dealings between the parties, no usage of the trade, and no parol or extrinsic evidence of any nature shall be used or be relevant to supplement or explain or modify any term or provision of this Guaranty. There are no conditions to the full effectiveness of this Guaranty. The terms and provisions hereof may not be waived, altered, modified, or amended except in a writing executed by Guarantor and a duly authorized officer of Bank. All rights, benefits and privileges hereunder shall inure to the benefit of and be enforceable by Bank and its successors and assigns and shall be binding upon Guarantor and his heirs, executors, administrators, personal representatives, successors and assigns. Section headings are used herein for convenience only. Guarantor acknowledges that the same may not describe completely the subject matter of the applicable Section, and the same shall not be used in any manner to construe, limit, define or interpret any term or provision hereof.

     21. Governing Law; Venue and Jurisdiction. This instrument and all acts and transactions pursuant or relating hereto and all rights and obligations of the parties hereto shall be governed, construed, and interpreted in accordance with the internal laws of the State of California without regard for principles of conflicts of laws. In order to induce Bank to accept this Guaranty, and as a material part of the consideration therefor, Guarantor (i) agrees that all actions or proceedings relating directly or indirectly hereto shall, at the option of Bank, be litigated in courts located within Los Angeles County, California; (ii) consents to the jurisdiction of any such court and consents to the service of process in any such action or proceeding by personal delivery or any other method permitted by law; and (iii) waives any and all rights Guarantor may have to transfer or change the venue of any such action or proceeding.

     22. Mutual Waiver of Right to Jury Trial. TO THE EXTENT ALLOWABLE BY APPLICABLE LAW, BANK AND GUARANTOR HEREBY WAIVE THE RIGHT TO TRIAL BY JURY IN ANY ACTION, CLAIM, LAWSUIT OR PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING TO: (i) THIS GUARANTEE OR ANY SUPPLEMENT OR AMENDMENT THERETO; OR (ii) ANY OTHER PRESENT OR FUTURE INSTRUMENT OR AGREEMENT BETWEEN BANK AND GUARANTOR; OR (iii) ANY BREACH, CONDUCT, ACTS OR OMISSIONS OF BANK OR GUARANTOR OR ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, ATTORNEYS OR ANY OTHER PERSON AFFILIATED WITH OR REPRESENTING BANK OR GUARANTOR; IN EACH OF THE FOREGOING CASES, WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE.

     23. Receipt of Copy. Guarantor acknowledges receipt of a copy of this Guaranty.

		Guarantor Signature:
		PeopleSupport (Philippines), Inc..
		a Philippines corporation
		By:		/s/ Lance Rosenzweig
		Name: Lance Rosenzweig
		Title: Chairman
		Address:				1100 Glendon Ave. #1250
						Los Angeles, CA 90024
		STC Solutions, Inc.,
		a Delaware corporation
		By:		/s/ Lance Rosenzweig
		Name: Lance Rosenzweig
		Title: President
		Address:				1100 Glendon Ave. #1250
						Los Angeles, CA 90024
		ProArm Management, Inc.,
		a Delaware corporation
		By:		/s/ Lance Rosenzweig
		Name: Lance Rosenzweig
		Title: President
		Address:				1100 Glendon Ave. #1250
						Los Angeles, CA 90024
		PeopleSupport Rapidtext, Inc.,
		a Delaware corporation
		By:		/s/ Lance Rosenzweig
		Name: Lance Rosenzweig
		Title: President
		Address:				1100 Glendon Ave. #1250
						Los Angeles, CA 90024

S-1
Continuing Guaranty

		The Transcription Company, a California corporation
		By:		/s/ Lance Rosenzweig
		Name: Lance Rosenzweig
		Title: President
		Address:				1100 Glendon Ave. #1250
						Los Angeles, CA 90024
		PeopleSupport (Costa Rica), S.R.L., a Costa Rican entity
		By:		/s/ Lance Rosenzweig
		Name: Lance Rosenzweig
		Title: Manager
		Address:				1100 Glendon Ave. #1250
						Los Angeles, CA 90024

S-2
Continuing Guaranty