Audit Committee periodically reviews the rules and regulations adopted, from time to time, by the Public Company Accounting Oversight Board (the “PCAOB”) and works with the Auditor to ensure that its opinion conforms with these requirements. During 2021, the Audit Committee also discussed with the Auditor those matters that are required to be discussed under the PCAOB rules and received required written disclosures from the Auditor regarding the Auditor’s communication with the Audit Committee concerning the Auditor’s independence..Audit Committee | Gregory A. Conley, | Chair | Robert N. Frerichs | | Robert N. Frerichs | | Ekta Singh-Bushell | | Steven J. Anenen | |
STOCK OWNERSHIP OF DIRECTORS, MANAGEMENT, AND CERTAIN BENEFICIAL OWNERS
The table below sets forth information, as of March 31, 2022,April 3, 2024, concerning the beneficial ownership of the following persons and entities: | ·● | Each person or entity known to us to beneficially own more than 5 percent5% of our outstanding common stock; |
| ·● | Each of ourthe directors and nominees foron our Board; |
| ·● | Each of our executive officers, including our Named Executive Officers; and |
| ·● | All of our current directors and executive officers as a group. |
We have determined beneficial ownership in accordance with the SEC rules. Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the persons and entities named in the table below have sole voting and/or investment power with respect to all shares of common stock that they beneficially own, subject to applicable community property laws. Applicable percentage ownership is based on 47,035,63447,448,910 shares of common stock outstanding as of March 31, 2022.April 3, 2024. In computing the number of shares of common stock beneficially owned by a person or entity and the percentage ownership of that person or entity in accordance with the SEC rules, we deemed outstanding shares of common stock: (1) subject to stock options held by that person that are currently exercisable or exercisable within 60 days of March 31, 2022;April 3, 2024; and (2) issuable upon the vesting of restricted stock units (“RSUs”)(RSUs) or performance-based restricted stock units (“PRSUs”)(PRSUs) within 60 days of March 31, 2022.April 3, 2024. In accordance with the SEC rules, we did not deem outstanding these two categories of shares of common stock for the purpose of computing the percentage ownership of any other person or entity. The information provided in the table is based solely on our records, and information filed with the SEC with respect to the owners of our shares of common stock, except where otherwise noted. Unless otherwise indicated, the address of each beneficial owner listed in the table is c/o TTEC Holdings, Inc., 9197 South Peoria Street, Englewood, Colorado 80112.6312 S. Fiddler’s Green Circle, Suite 100N, Greenwood Village, CO 80111. Stock Ownership of Directors, Management, and Certain Beneficial Owners
| | Shares Beneficially Owned | Name of the Beneficial Owner | | Common Stock | | Options Vested and Options and RSUs Vesting Within 60 Days of March 31, 2022 | | Total Beneficial Ownership as of March 31, 2022 | Percent of Class | 5% Stockholders | | | | | | | | | Kenneth D. Tuchman | | 27,853,207 | 1 | - | | 27,853,207 | 1 | 59.2% | BlackRock Inc. | | 2,834,994 | 2 | - | | 2,834,994 | 2 | 6.0% | The Vanguard Group | | 2,449,025 | 3 | - | | 2,449,025 | 3 | 5.2% | Executive Officers, Directors, and Nominees | | | | | | | | | Kenneth D. Tuchman | | 27,853,207 | 1 | - | | 27,853,207 | 1 | 59.2% | Steven J. Anenen | | 18,645 | | 1,194 | | 19,839 | | * | Tracy L. Bahl | | 14,751 | | 1,194 | | 15,945 | | * | Gregory A. Conley | | 13,841 | | 1,194 | | 15,035 | | * | Richard Sean Erickson | | 1,232 | | - | | 1,232 | | * | Robert N. Frerichs | | 14,966 | | 1,194 | | 16,160 | | * | Judi A. Hand | | 114,954 | | - | | 114,954 | | * | Marc L. Holtzman | | 25,385 | 4 | 1,194 | | 26,579 | 4 | * | Gina L. Loften | | - | | 2,205 | | 2,205 | | * | Margaret B. McLean | | 42,947 | | - | | 42,947 | | * | Regina M. Paolillo | | 223,028 | | - | | 223,028 | | * | Dustin J. Semach | | - | | - | | - | | * | Ekta Singh-Bushell | | 13,601 | | 1,194 | | 14,795 | | * | All directors, director nominees and executive officers as a group (13 persons) | | 28,336,557 | | 9,369 | | 28,345,926 | | 60.3% |
| 1 | Includes 27,843,207 shares subject to sole voting and investment power, and 10,000 shares with shared voting and investment power. The shares with sole voting and investment power consist of: (i) 6,526,401 shares held by Mr. Tuchman; (ii) 14,766,806 shares held by a limited liability partnership controlled by Mr. Tuchman; and (iii) 6,550,000 shares held by a revocable trust controlled by Mr. Tuchman. The shares with shared voting and investment power consist of 10,000 shares owned by Mr. Tuchman’s spouse. Mr. Tuchman is the beneficial owner of 59.2 percent of the shares of common stock entitled to vote at the meeting. |
| 2 | The common stock shown for BlackRock, Inc. located at 55 East 52nd Street New York, NY 10055, corresponds with their 13G filed as of December 31, 2021 and includes 2,801,354 shares with sole voting power and 2,834,994 shares in the aggregate. |
| 3 | The common stock shown for The Vanguard Group located at 100 Vanguard Boulevard, Malvern, PA 19355, corresponds with their 13G filed as of December 31, 2021 and includes 0 shares with sole voting power and 2,449,025 shares in the aggregate. |
| 4 | Includes 22,085 shares held by Mr. Holtzman directly and 3,300 shares held for Mr. Holtzman’s minor children. |
| | Shares Beneficially Owned | Name of the Beneficial Owner | | Common Stock | | Options Vested and Options and RSUs Vesting Within 60 Days of April 3, 2024 | | Total Beneficial Ownership as of April 3, 2024 | Percent of Class | 5% Stockholders | | | | | | | | | Kenneth D. Tuchman | | 27,853,207 | 1 | - | | 27,853,207 | 1 | 58.7% | BlackRock Inc. | | 3,333,995 | 2 | - | | 3,333,995 | 2 | 7.03% | The Vanguard Group | | 2,409,680 | 3 | - | | 2,409,680 | 3 | 5.08% | Executive Officers, Directors | | | | | | | | | Kenneth D. Tuchman | | 27,853,207 | 1 | - | | 27,853,207 | 1 | 58.7% | Steven J. Anenen | | 21,829 | | 5,982 | | 27,811 | | * | Tracy L. Bahl | | 17,935 | | 5,982 | | 23,917 | | * | Francois Bourret | | 5,051 | | 1,191 | | 6,242 | | * | Gregory A. Conley | | 17,025 | | 5,982 | | 23,007 | | * | Robert N. Frerichs | | 18,150 | | 5,982 | | 24,132 | | * | Marc L. Holtzman | | 38,004 4 | | 5,982 | | 43,986 4 | | * | Gina L. Loften | | 4,195 | | 5,982 | | 10,177 | | * | Margaret B. McLean | | 53,123 | | 1,634 | | 54,757 | | * | David J. Seybold | | - | | - | | - | | * | Ekta Singh-Bushell | | 16,785 | | 5,982 | | 22,767 | | * | Michelle “Shelly” R. Swanback | | 16,513 | | 12,190 | | 28,703 | | * | Kenneth “Kenny” R. Wagers | | - | | - | | - | | * | All directors, director nominees and executive officers as a group (13 persons) | | 28,061,817 | | 56,889 | | 28,118,706 | | 59.3% | | | | | | | | | | | | |
* Less than 1%. 1. Includes 27,843,207 shares subject to sole voting and investment power, and 10,000 shares with shared voting and investment power. The shares with sole voting and investment power consist of: (i) 6,526,401 shares held by Mr. Tuchman; (ii) 14,766,806 shares held by a limited liability partnership controlled by Mr. Tuchman; and (iii) 6,550,000 shares held by a revocable trust controlled by Mr. Tuchman. The shares with shared voting and investment power consist of 10,000 shares owned by Mr. Tuchman’s spouse. Mr. Tuchman is the beneficial owner of 58.7% of the shares of common stock entitled to vote at the meeting. 2.The common stock shown for BlackRock, Inc. located at 55 East 52nd Street New York, NY 10055, corresponds with their 13G filed as of December 31, 2023 and includes 3,291,993 shares with sole voting power, 3,333,995 shares with sole dispositive power and 3,333,995 shares in the aggregate. 3.The common stock shown for The Vanguard Group located at 100 Vanguard Boulevard, Malvern, PA 19355, corresponds with their 13G filed as of December 29, 2023 and includes 35,865 shares with shared voting power, 2,354,973 shares with sole dispositive power, 54,707 shares with shared dispositive power and 2,409,680 shares in the aggregate. 4. Includes 33,229 shares held by Mr. Holtzman directly and 4,775 shares held for Mr. Holtzman’s spouse and minor children. TTEC Insider Trading Policy – Hedging/Pledging Restrictions The Company’s insider trading policy prohibits its directors, officers, employees, and members of TTEC supply chain from engaging in hedging and pledging transactions with TTEC securities. Under the policy, TTEC Chairman of the Board and Chief Executive Officer, who is the Company’s controlling shareholder, is permitted to pledge his shareholdings, with prior review and approval of the TTEC Board of Directors, provided such pledge does not involve a material portion of his overall holdings. RELATED-PARTY TRANSACTIONS In accordance with our written Related-Party Transaction Policy, the Audit Committee of the Board is responsible for review and approval of transactions required to be disclosed as a “related-party” transaction under applicable law, including the SEC rules (generally, transactions involving amounts in excess of $120,000 in which a related person has a direct or indirect material interest). TTEC management monitors all related-party transactions, and reports about their status to the Audit Committee quarterly. TTEC executive officers and directors complete a questionnaire during the first quarter of each fiscal year, in which they provide information about the terms of all their related-party transactions (as defined in Item 404(a) of Regulation S-K) that occurred during the prior year and that are expected to occur during the current year. In reviewing related-party transactions, the Audit Committee of the Board considers whether these transactions are executed at “arms-length” by reviewing all relevant facts and circumstances, including among others, the commercial reasonableness of the terms, the actual and perceived benefit to the Company, opportunity costs of alternate transactions, the materiality and character of the related-party’s interest, the actual and apparent conflict of interests, the impact on a director’s independence (if the related-party is a director, an immediate family member of a director, or an entity controlled by a director), and the terms on which a similar transaction can be secured from unrelated third parties. During 2021,2023, TTEC has undertaken the following related-party transactionstransaction(s) with prior approval of the Audit Committee of the Board: | · | The Company entered into an agreement under which Avion, LLC (“Avion”) and Airmax LLC (“Airmax”)The Company entered into an agreement under which Avion, LLC (Avion) and Airmax LLC (Airmax) provide certain aviation flight services as requested by the Company. Such services include the use of an aircraft and flight crew. Kenneth D. Tuchman, Chairman and Chief Executive Officer of the Company, has an indirect 100% beneficial ownership interest in Avion and Airmax. During 2023, 2022, and 2021, the Company expensed $1,000,000, $500,000, and $600,000, respectively, to Avion and Airmax for services provided to the Company. There was $218,000 in payments due and outstanding to Avion and Airmax as of December 31, 2023. EXECUTIVES AND EXECUTIVE COMPENSATION TTEC Executive Officers ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp001img025.jpg) | Michelle “Shelly” R. Swanback, 55, serves as President of the Company has an indirect 100 percent beneficial ownership interestand chief executive officer of TTEC Engage. She joined the Company in AvionMay 2022 as the chief executive officer of TTEC Engage and Airmax. During 2021,was named President for TTEC Holdings, Inc. in November 2022. With a proven track record driving growth in the digital environment, Shelly is both a market maker and a strong cultural leader with over 30 years of experience in digital transformation, strategic consulting, technology, services, analytics and M&A. Prior to TTEC, between 2020 and 2019,2022, Ms. Swanback was President of Product and Platform at Western Union (NYSE:WU), where she led the company’s digital transformation and doubled the WU digital business to $1 billion. Between 2014 and 2020, Ms. Swanback led Accenture Digital, building it into a global transformation powerhouse with more than $20 billion in annual revenue. Shelly is currently a board member for Willis Towers Watson (NASDAQ:WTW). Ms. Swanback holds bachelor’s degrees in Finance and Computer Information Systems from Colorado State University. | ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp001img026.jpg) | Francois Bourret, 44, joined TTEC in 2016 as part of an acquisition and has been serving as Chief Accounting Officer since 2023. In April 2023, Mr. Bourret assumed the responsibilities of the interim Chief Financial Officer for the Company, expensed $600,000, $400,000,the role that he maintained until February 29, 2024. Mr. Bourret brings over 20 years of financial experience with public companies and $1.1 million, respectively, to Avion and Airmax for services providedprivate equity owned businesses to the Company. There was $50,000role. Since joining TTEC, Mr. Bourret served in payments due and outstanding to Avion and Airmax as of December 31, 2021. While in 2022 TTEC continues to be cautious with non-essential travel, we anticipate that the Avion and AirMax expenses will return to the 2019 levelsvarious significant roles in the TTEC finance and accounting organization, including chief financial officer for the TTEC Engage business segment between 2018 and 2022, as travel startsthe Company’s global controller since June 2002, and his appointment as the Chief Accounting Officer in 2023. Prior to return to pre-COVID-19 levels. Based on this, we anticipateTTEC, Mr. Bourret served as the 2022 expenditures will be lower than the 2019 spend but will exceed the 2021 spend. |
| · | Welltok, Inc., a consumer health SaaS company,chief financial officer and TTEC had a joint venture, Welltok TTEC Communications, which provided services to healthcare clients, and which was dissolved in 2021. Regina M. Paolillo, Global Chief Operating Officer of the Company, was a member of the board of directors of Welltok, Inc. Ms. Paolillo also previously heldAtelka, a small investmentCanadian customer care outsourcing company; and worked for Kilmer Capital Partners, a private equity fund; and for KPMG.Mr. Bourret holds a Master of Business Administration degree from Université Laval in Welltok. During the years ended December 31, 2021, 2020Québec, Canada; and 2019, the Company recorded revenue of $1.5 million, $3.0 million, and $5.3 million, respectively, in connection with the work performed through the joint venture. As of December 31, 2021, Ms. Paolillo is no longer a member of the board of directors of Welltok. Chartered Financial Analyst (CFA). |
| · | Ms. Paolillo is also a member of the board of directors of Unisys (NYSE:UIS), a global information technology company. During the year ended December 31, 2021, the Company recorded revenue of $0.4 million in connection with services performed for Unisys. |
| · | Ms. Paolillo is also a member of the board of directors of Alight Solutions (NYSE:ALIT), a human capital business solutions company. In 2022, the Company and Alight entered into a services agreement pursuant to which Alight will have an opportunity to earn approximately $1.0 million per year for a period of five years. As of the date of this proxy, no fees have been earned under this agreement. |
EXECUTIVES AND EXECUTIVE COMPENSATION
![Sean Erickson](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp6img001.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp001img027.jpg) | Richard Sean EricksonDavid J. Seybold, 60, serves as Global Head of TTEC Engage business segment. Mr. Erickson58, joined TTEC in 2020 to lead operationsDecember 2022 as the chief executive officer for the company’s EngageTTEC Digital. An experienced, global business segment around the globe. After running TTEC’s North American operations in the early 2000s,leader with a passion for technology, Mr. Erickson held executive leadership roles in customer experience, cloud technology, consulting, business process outsourcing, and telecommunication industries. Seybold’s career is characterized by driving growth through digital transformation at scale. Prior to joining TTEC, Mr. EricksonSeybold, was the managing director for strategic consulting at Eventus Solutions Group, a customer experience transformation company, where he led work-at-home solution offerings; president and chief executive officer, at OneTouch Brands,Americas for Atos SE, a video engagement solutions company;Euronext-listed technology transformation company. Between 2015 and chief venture officer at SITEL, a global contact center services provider. Mr. Erickson holds a degree in Business Administration from Wichita State University. | | | ![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp6img002.jpg) | Judi A. Hand, 60, serves as Chief Revenue Officer for TTEC. She joined the Company in 2007, when TTEC acquired Direct Alliance Corporation, where she served as president. Between 2011 and 2013 she served as TTEC’s Chief Sales Officer, the role that she resumed under a new revenue officer title in 2016. Between 2003 and 2007, Ms. Hand was a senior executive with AT&T (NYSE:T), culminating her career there as a senior vice president for enterprise sales. Prior to AT&T, Ms. Hand worked at Qwest, then a public global communications company and several of its subsidiaries in sales and marketing roles of increasing responsibility. Since June 2020, Ms. Hand has been serving as a member of the board of directors of Ooma, Inc. (NYSE:OOMA), a communications platform for businesses and consumers. Ms. Hand also serves as a board advisor to Four Winds Interactive, and between 2016 and 2017, she was a member of the board of directors of Manitoba Telecom Services, Inc., a Canada telecommunication company. Ms. Hand holds an MBA from Stanford University and a B.S. in Communications degree from University of Nebraska. | | | ![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp6img003.jpg) | Regina M. Paolillo, 63, serves as Global Chief Operating Officer for TTEC. Ms. Paolillo joined TTEC in 2011 as Chief Financial and Administrative Officer and transitioned to her current role in 2021. Between 2009 and 2011, Ms. Paolillo was an executive vice president for enterprise services and chief financial officer at Trizetto Group, Inc., a privately held professional services company serving the healthcare industry. Between 2007 and 2008, Ms. Paolillo served as a senior vice president, operations group for General Atlantic, a leading global growth equity firm. Between 2005 and 2007, Ms. Paolillo served as an executive vice president for revenue cycle and mortgage services at Creditek, a Genpact (NYSE:G) subsidiary. Prior to the Company’s acquisition by Genpact, between 2003 and 2005 and 2002 and 2003, Ms. Paolillo was Creditek’s chief executive officer and chief financial officer respectively. Ms. Paolillo also2021, he served as the president, North America and chief financial officer and executive vice president for corporate services at Gartner, Inc., (NYSE:IT) an information technology research and advisory company. Ms. Paolillo is a member of the board of directors of Alight (NYSE:ALIT) since 2021; and has been a member of the board of directors of Unisys Corporation (NYSE:UIS) since 2018. Between 2018 and 2021, Ms. Paolillo also was a member of the board of directors of Welltok, Inc., a private consumer health SaaS company. Ms. Paolillo holds a B.S. in Accounting degree from University of New Haven. | | | ![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp6img004.jpg) | Dustin J. Semach, 40, joined TTEC in 2020, as part of our planned CFO succession, assuming the role of TTEC CFO in Q3 2021. Prior to TTEC, Dustin was the chief financialoperating officer for Rackspace (NASDAQ:RXT)Avanade (a Microsoft – Accenture joint venture); and heldprior to that, Mr. Seybold spent more than 26 years in various senior financialexecutive roles in the technology services and business process outsourcing industries, including DXC Technology (NYSE:DXC), Computer Services Corporation (NYSE:CSC), andfor IBM (NYSE:IBM)(IBM:NYSE).Mr. SemachSeybold holds an MBA from Northeastern University and a bachelor’s degree in Computer ScienceQuantitative Business Analysis and a degree in Economics from Clemson University. Penn State University; a master’s of science degree in Operations Management and an MBA from the University of Maryland, Robert H. Smith School of Business. |
![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp6img005.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp001img028.jpg) | Margaret B. McLean , 58, joined TTEC in 201360, serves as the Company’s General Counsel and Chief Risk Officer. Officer of TTEC. She joined TTEC in June 2013.Prior to TTEC, Ms. McLean was a senior executive atthe chief legal and risk officer for CH2M (now part of Jacobs Engineering Group (NYSE:JEC)), a global engineering and program management company, serving as that company’s chief legal officer.company. Prior to CH2M, Ms. McLean was a corporate finance and M&A partner at a major law firm, working in its Denver, London, and Moscow offices. Ms. McLean started her career in IT at Hewlett Packard (NYSE:HPE) and led the application systems department for Science Applications Int’l (NYSE:SAIC). She holds a JD from the University of Michigan, an MBA from the University of Colorado, and a B.S.bachelor’s degree in Management Information Systems and Computer Science from the University of Arizona. | ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp001img029.jpg) | Kenneth “Kenny” R. Wagers, 52, joined TTEC in February 2024 and assumed responsibilities of the Company’s Chief Financial Officer as of March 1, 2024. Mr. Wagers brings to the role over 28 years of financial and operational experience with public and private companies. Prior to joining TTEC, Mr. Wagers served as chief financial officer of Flexport, a global logistics and freight forwarding business from 2021 to 2023; as chief financial officer of FleetPride, a retailer of parts for heavy-duty trucks and trailers, between 2019 and 2021; and as chief operating officer of XPO Logistics, a global provider of supply chain solutions, between 2018 and 2019. In 2020, Mr. Wagers joined the board of directors of Snap One Holdings Corporation (NASDAQ:SNPO), where he currently serves on the Audit and Risk Management committee, which he chaired between 2020 and 2022. Mr. Wagers holds a BA in Finance and an MBA from Georgia State University. |
Information regarding Kenneth D. Tuchman, Chairman and Chief Executive Officer, is provided in this section under the heading “20222024 Director Nominees.Nominees.”
COMPENSATION DISCUSSION AND ANALYSIS Compensation Discussion and Analysis
In this section, we discuss our compensation philosophy and describe the 20212023 compensation program for our Chief Executive Officer, former Chief Financial Officer, interim Chief Financial Officer and fourthree additional highest compensated members of our executive leadership team, whom we refer to as our Named Executive Officers (“NEOs”)(NEOs). We describe compensation earned by each of our Named Executive Officers and explain how our Compensation Committee of the Board determined this compensation, including its rationale for specific 20212023 compensation decisions. 2021 PERFORMANCE HIGHLIGHTS2023 Performance Highlights Our 20212023 performance is summarized below: | ● | ●Our revenue was a record $2.27$2.46 billion, an increase of 16.6 percent0.8% over the year ago period.
prior year. |
| ● | Our income from operations was $217.2$118.0 million, or 9.6 percent4.8% of revenue, a 6.1 percent increase30.0% decrease year over year. Income from operations on a non-GAAP basis1 was $286.2$200.4 million, or 12.6 percent8.1% of revenue, compared to12.4 percentto 10.2% in the prior year. |
| ● | Our net cash provided by operating activities was $251.3$144.8 million compared to $271.9$137.0 million in the prior year. |
| ● | | ● We booked $751 million in new business, a 14 percent increase over the prior year.
●Our diluted earnings per share were $2.97$0.18 compared to $2.52$2.18 in the prior year, and $4.62$2.181 compared to $3.83$3.59 in the prior year on a non-GAAP basis.
|
| ● | We paid a total of $42.2$49.2 million in cash dividends to our shareholders. |
| 11. | TTEC computespresents company performance metrics on a non-GAAP basis to more accurately convey the performance of the business, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, deconsolidation of subsidiaries,cybersecurity incident-related costs, equity-based compensation expense, depreciation and amortization expense, changes in acquisition earn-outs,contingent consideration, changes in tax valuation allowances, return to provision adjustments, and one-time non-recurring items. PleaseFor additional information, please review a copyGAAP to Non-GAAP Reconciliation of the 2021 Annual Report and 2021 full-year earnings press release for a reconciliationPerformance Metrics on page 59 of these non-GAAP adjustments.this Proxy Statement. |
![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp001img030.jpg)
Named Executive Officers | ● | Kenneth D. Tuchman, Chairman of the Board and Chief Executive Officer.Officer |
| ● | Regina M. Paolillo,Michelle “Shelly” R. Swanback, President, TTEC Holdings, Inc. and chief executive officer, TTEC Engage |
| ● | Francois Bourret, Chief AdministrativeAccounting Officer and Interim Chief Financial Officer for a portion of 2021, and Global Chief Operating Officer for the remainder of the year. |
| ● | Dustin J. Semach, Former Chief Financial Officer for a portion of 2021. |
| ● | David J. Seybold, chief executive officer, TTEC Digital |
| ● | ●Judi A. Hand, Chief Revenue Officer.
●Richard Sean Erickson, Global Head of Engage business segment.
●Margaret B. McLean, General Counsel and Chief Risk Officer. Officer
|
2023 Executive Compensation Summary Our executive compensation program is designed to reward financial results and effective strategic leadership, which we believe are key elements in building sustainable value for stockholders. Our compensation programs’program performance metrics align the interests of our stockholders and senior executives by correlating the timing and amount of actual pay to the Company’s short-short-term and long-term performance goals. Our compensation programs encourage ethical and responsible conduct in pursuit of these goalsand the alignment of our leaders with TTEC’s vision, mission, and values. We carefully benchmark our compensation decisions against a relevant group of peer companies, – all of which are our potential competitors, – for the caliber of executive talent required to manage a global and complex business like TTEC. Our executive compensation programs include three principal elements: Compensation Element | Purpose | | ● | Base Salary | ● | Provides competitive fixed dollar compensation. | | ● | Annual Performance-Based Cash Incentive Awards | ● | Provides “at risk” annual variable cash consideration that aligns executive compensation to the Company and individual achievementsachievement of short-term (annual) performance objectives, as established by the Board of Directors. | | ● | Equity Grants | ● | Provides an “at risk” long-term performance-based and short-term time-based equity compensation opportunity. Our annual equity incentive program includes two components: one that rewards the prior year’s performance but vests over time, and another that is forward looking and rewards growth of key performance indicators like revenueRevenue and operating income over a three-year period.Adjusted EBITDA three years into the future. From time-to-time we may grant equity awards that are not part of our annual program, such as upon the promotion of an executive (which we refer to as “promotional grants”) or to encourage retention (which we refer to as “retention grants”). By emphasizing a longer-term view inand long-term growth objectives with equity performance incentives, the Company aligns our Executive Officers’ interests with the interests of and value creation for our stockholders. By emphasizing long-term growth objectives for Executive Officers’ compensation purposes, we continue to align their interests with the interests of our stockholders. The transition from the annual performance-based to annual and multi-year performance-based equity incentive program has been fully implemented 2019 through 2021. |
For 2021,In 2023, we paid the following Total Direct Compensation to our Named Executive Officers:
Named Executive Officers | Actual Total Direct (TDC) Compensation 1 | Market TDC at 25th | Market TDC at 50th | Market TDC at 75th | Percentile | Kenneth D. Tuchman 2 | $ 1 | $5,588,000 | $6,999,000 | $9,087,000 | <25th | Richard Sean Erickson | $ 892,231 | $ 694,000 | $1,120,000 | $1,820,000 | >25th | Judi A. Hand | $2,069,994 | $ 970,000 | $1,516,000 | $2,317,000 | >50th | Margaret B. McLean | $1,215,656 | $ 773,000 | $1,006,000 | $1,582,000 | >50th | Regina M. Paolillo 3 | $2,437,518 | $1,690,000 | $2,693,000 | $4,540,000 | >25th | Dustin J. Semach 4 | $ 764,288 | $1,911,000 | $2,195,000 | $3,040,000 | <25th |
Named Executive Officers | Actual Total Direct (TDC) Compensation 1 | Market TDC at 25th | Market TDC at 50th | Market TDC at 75th | Percentile | Kenneth D. Tuchman 2 | $1 | $5,850,000 | $7,208,000 | $9,370,000 | <25th | Michelle “Shelly” R. Swanback 3 | $5,947,110 | $1,937,000 | $2,984,000 | $4,363,000 | >75th | Francois Bourret 4 | $917,947 | $382,932 | $505,880 | $811,451 | >75th | Dustin J. Semach 5 | $159,615 | $2,148,000 | $2,735,000 | $3,327,000 | - | David J. Seybold | $937,507 | $934,000 | $1,912,000 | $3,350,000 | <50th | Margaret B. McLean | $686,536 | $746,000 | $1,235,000 | $1,643,000 | <25th |
| 11. | Actual TDC represents base salary earned in 2021,2023, bonus earned for 2021 performance paid in 2021 and2023 for 2022 FMVperformance, retention bonuses paid in 2023, fair market value (FMV) of RSU equity grants awarded in 2021,2023, and fair market value (FMV) of performance-based shares grantedgrants, at target achievement, awarded under the 2021 long-term incentive plan and settlement in 2022 of performance-based awards earned for the 2021 achievement period (Tranche 3) under the 20192023 annual long-term incentive plan. |
| 22. | As previously disclosed, at Mr. Tuchman’s request, the Compensation Committee approved Mr. Tuchman’s base salary to be $1 per year. |
| 33. | Ms. Paolillo was promotedSwanback’s actual TDC includes a one-time $2 million RSU equity grant, vesting in equal installments over a five-year period and a $2 million performance-based equity grant, subject to Globala 3-year cliff vesting period, both issued in connection with her promotion to President, TTEC Holdings, Inc. |
| 4. | The market data presented for Mr. Bourret corresponds with his primary role as Chief Operating Officer in 2021. Market benchmark data shown inAccounting Officer. |
| 5. | Due to Mr. Semach’s limited tenure during 2023, we have not compared his 2023 actual TDC against the above table aligns to her new role.market benchmarks. |
4 | Mr. Semach was promoted to Chief Financial Officer in 2021. Market benchmark data shown in the above table aligns to his new role. |
The mix of base and variable “at risk”“at risk” compensation for 20212023 was as follows and excludes our CEO, and Mr. Semach who was newly promotedsince he does not participate in 2021:TTEC’s incentive programs:
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CONSIDERATION OF 2020 “SAY-ON-PAY” VOTE At our 20202023 Annual Meeting of Stockholders, 99.77percent99% of the votes cast in our stockholder advisory vote approved the compensation of our Named Executive Officers (our “Say-On-Pay” vote). In light of this strong stockholder support, the Compensation Committee of the Board made no significant changes to the overall design of our compensation programs during 2020 but continued its pay for performancepay-for-performance philosophy by putting a substantial portion of executives compensation at risk and aligning executive officers’ interests with value generation for TTEC stockholders. The Compensation Committee of the Board will continue to review best practices in executive compensation and adjust the structure of TTEC executive compensationscompensation to be consistent with market trends, our pay-for-performance philosophy, and to make sure that TTEC’s executive compensation aligns the interest of the executive leadership team with the interests of the Company’s stockholders. TheStockholders will again consider our executive compensation on an advisory basis as part of the 2026 Annual Stockholder Meeting, and the Compensation Committee of the Board will continue considering the outcome of the stockholders Say-On-Pay votesto take into account this input when making future compensation decisions for our Named Executive Officers.
CONSIDERATION OF 2017 “FREQUENCY ON SAY-ON-PAY” VOTE At our 20172023 Annual Meeting of Stockholders, we asked stockholders to consider how often they wish to vote, on an advisory basis, on the Say-On-Pay matters (the “Frequency of Say-On-Pay” vote). The stockholders decided to hold theStockholders indicated strong support of our existing practice, with 71% voting in favor of an advisory, non-binding vote on executive compensation every three years by a vote of 82.6 percent.years. In the six years prior totwo previous stockholder votes, occurring at the 2020 and 2017 FrequencyAnnual Meetings of Say-On-Pay vote,Stockholders, TTEC stockholders approved itsthe Company’s executive compensation by an average margin of greater than 95 percent.99% or higher. The stockholders will have their next opportunity to consider how often they wish to vote on “Say-On-Pay” matters involving executive compensation as part of the 20232029 Annual Meeting of Stockholders. EXECUTIVE LEADERSHIP TEAM COMPENSATION APPROACH AND STRUCTURE Our Approach to Executive Leadership Compensation We structure our executive compensation to attract and retain executive talent who can maximize our performance results. Our compensation program is designed to motivate our executive leadership team to remain focused on delivering superior performance that creates long-term investor value. Our executive compensation program also places significant weight on how our leaders align their conduct with TTEC’s vision, mission, and values as they achieve their personal goals and the Company’s performance goals. Our Compensation Practices Include: | Pay for Performance. We encourage a results-oriented culture through pay-for-performance compensation, and annually review executive compensation against the Company’s overall performance and its annual goals. | Competitive Compensation Targets. The Compensation Committee of the Board annually sets each executive’s target total direct compensation based on a review of market benchmarks. | Rigorous Performance Metrics. The Compensation Committee of the Board annually reviews and re-sets executive performance targets to assure that they appropriately reflect the goals of the business and are challenging, but achievable. | Stockholder Alignment. Through our compensation practices, we align the interests of our Named Executive Officers, other executive officers, and our stockholders to maximize long-term performance goals of the Company. | Affordability of Rewards. We ensure that our rewards are affordable by aligning them to the Company’s results of operation as they compare to our annual business plan. | Significant “at risk” Component. We structure our compensation programs with a significant portion of variable or “at risk” to ensurepay so that actual compensation realized by Named Executive Officers directly and demonstrably links to individual and Company-wide performance. | Share Ownership Guidelines. OurTTEC’s Chief Executive Officer and Global Chief Operating Officerthe chief executive officers of TTEC’s business segments are expected to hold TTEC equity in an amount of at least 4 times their base compensation,compensation; our Chief Financial Officer is expected to hold TTEC equity in the amount of at least 3 times theirhis base compensation; while other members of the executive leadership team including all Named Executive Officers, are expected to hold equity equal to 1.51 to 2.5 times their base compensation based on their position level. | Restrictive Covenants. Members of our executive leadership team are subject to market appropriate restrictive covenants, effective on separation from TTEC. These restrictive covenants include non-competition, client and employee non-solicitation, and customary non-disclosure obligations. | Individual Accountability. Our compensation program is designed to ensure thatincentivize our Named Executive Officers to remain focused on our company and their group financial goals to build the foundation for our long-term success. | Review of Compensation Peer Group. OurThe Compensation Committee of the Board reviews our executive compensation program against our peer group annually and adjusts, when necessary, to make sure that it remains relevant and appropriate. |
Executive Leadership Team Compensation Structure33
EXECUTIVE LEADERSHIP TEAM COMPENSATION STRUCTURE To achieve its overarching objectives, our executive compensation program consists of the following three principal elements: Compensation Element | Characteristics | Purpose | Philosophy | Base salary | Fixed annual compensation that provides a competitive level of base compensation. | Compensate senior executives for their level of experience and responsibility. | We believe base salary should be competitive. | Annual performance-based cash incentive awards | Variable annual cash compensation opportunity funded based on objective Company performance targets (operating income) and paid based on subjective measures of individual performance. | Motivate and reward senior executives for performance against short-term Company goals. | We believe in providing appropriate incentives to drive the Company’s short-term financial and operational objectives. | Equity awards | Variable equity compensation granted annually, usually, in the form of restricted stock units (RSUs), or stock options or performance-based award opportunities as deemed appropriate. Our annual equity incentive program includes two components: one that rewards the prior year’s performance but vests over time, and another that is forward looking and rewards growth of key performance indicators like revenueRevenue and operating incomeAdjusted EBITDA over a three-year period. By emphasizing a longer-term view in equity performance incentives, the Company aligns our Executive Officers’ interests with the interests of and value creation for our stockholders. | Motivate and retain senior executives during the multi-year vesting and target periods and focus them on longer termlonger-term performance objectives by aligning their interests with those of our stockholders through the vesting period. | We believe that annual equity grants that vest over multiple years encourage the executive management team to focus on the long-term stock value appreciation. We also believe that multi-year performance targets offer important alignment between stockholders’ and executives’ interests over longer-term.the long term. These incentives in the aggregate provide a market competitivemarket-competitive equity opportunity. | | | | | |
In addition to these primary components of compensation, our senior executives are also eligible to participate in our general health and welfarewellness programs, 401(k) plan, life insurance program, and other employee benefit programs. Although to be competitive, we pay as perquisites all or a portion of certain Named Executive Officers’ healthcare premiums, weWe believe that perquisites should be limited in scope and value, and, historically, they have not constituted a significant portion of executive compensation.
OVERSIGHT OF OUR EXECUTIVE COMPENSATION PROGRAM Role of the Compensation Committee of the Board Our Compensation Committee of the Board determines all compensation for members of our executive leadership team, including our Named Executive Officers, on an annual basis. In doing so, the Compensation Committee:Committee of the Board: | ● | Evaluates the compensation received during the year by each executive and considers the Company’s performance, the individual performance of each executive and his/her skills, experience, and responsibilities to determine if any change in the executive’s compensation is appropriate. |
| | | | ● | Reviews with the Chief Executive Officer the performance of the other Named Executive Officers. |
| | | | ● | Reviews peer group data and the advice of the compensation consultant as a measure of the competitive market for executive talent in our industry. |
| | | | ● | Considers the executive’s contribution to the Company’s overall operating effectiveness, strategic success, and profitability, and considers the quality of the executive’s decision-making. |
| ● | Considers the executive’s role in developing and maintaining key client relationships. |
| | ● | Considers the Company’s financial results for the year and how the executive contributed to these results but does not adhere to strict formulas to determine the mix of base salary, equity grants and cash incentives. |
| | ● | Evaluates the level of responsibility, scope, and complexity of sucheach executive’s position relative to other Company executives. |
| | ● | Determines the composition and amount of compensation for each Named Executive Officer and uses its subjective judgment in determining the amount of each compensation element in order to retain and motivate current executives. |
| | ● | Assesses the executive’s leadership growth and management development over the past year. |
The Compensation Committee of the Board utilizes these subjective factors because it believes they are critical to increasing stockholder value. These factors are not quantified or weighted for importance, and the Compensation Committee’sCommittee of the Board’s use of these factors is tied directly to the individual role and the responsibilities of each executive officer. For example, greater weight may be given to the role of developing and maintaining key client relationships for the Chief Revenue Officer due to her responsibilities for overseeing sales operations, while greater weight will be given to contribution to our overall operating effectiveness, strategic success and profitability, and completion of strategic projects, among other factors, for the Global Chief Operating Officer, given her responsibilities relating to our financial performance and growth. Funding for performance-based cash incentives and our equity grants areis based on objective Company performance targets set at the beginning of each year. As a result, there is uncertainty with respect to the achievement of these funding targets at the time they are set. The Compensation Committee of the Board has the authority to modify the funding for these variable incentives, in its sole discretion, when material changes in the business warrant it. Our ability to achieve the funding target is heavily dependent not only on factors within our control, but also on current economic conditions, foreign exchange rate movements, weather events and other performance variables outside of our control. In measuring our performance against pre-determined performance targets, the Compensation Committee of the Board may make (and over the years has made) adjustments to these targets for items outside of the executive leadership team’s control. In addition to its discretion with respect to the performance-based cash incentives, and equity grants, during those years in which our actual performance resulted in a lower than anticipated level of funding, for the variable incentives, the Compensation Committee of the Board may from time to time determine that funding should be provided outside of the objective Company performance criteria to fund discretionary bonuses and equity awards to retain or to reward executive officers for their exceptional individual contribution (measured on a subjective basis). Although the Compensation Committee of the Board has this discretion, it utilizes it infrequently to maintain the integrity of the Company’s compensation structure and philosophy. How We Use Compensation Consultants From time to time, and as needed, the Compensation Committee of the Board retains services of compensation consultants, law firms, and other professional advisors to act as independent advisors to the Compensation Committee.Committee of the Board. In selecting its consultants, the Compensation Committee of the Board takes measures to assureensure that no member of our Board or any Named Executive Officer has any affiliations with such consultants. The Compensation Committee of the Board requires that all of its consultants provide it withan annual certification of their independence. In 2021,2023, the Compensation Committee of the Board utilized the services of Meridian Compensation Partners, LLC (Meridian)(Meridian), an executive compensation consulting firm, as the Compensation Committee of the Board’s independent advisor. The Compensation Committee of the Board did not use services of other advisors in 2021,2023, but they were available to the Committee as directed by the Committee chair. Meridian At least every other year, Meridian will provide the Compensation Committee of the Board with independent compensation advice on various aspects of executive compensation, including: | ● | A periodic review of our compensation practices, trends, and philosophy; |
| | | | ● | A competitive assessment of our executive compensation levels and pay-for-performance linkage; |
| | | | ● | An analysis of peer group companies that compete with us and that follow similar compensation models, along with benchmark compensation and benefits data for the peer group; |
| ● | A review of our equity award and cash incentive programs; |
| | ● | A review of our compensation practices compared to peer group companies and current trends related to executive employment agreements; and |
| | ● | Assistance in developing recommendations for compensation for our executive officers, including our Named Executive Officers. |
Meridian takes its direction solely from, and provides reports to, the Compensation Committee of the Board, or to members of our in-house human capitalPeople and Culture department at the direction and on behalf of the Compensation Committee.Committee of the Board. All costs of Meridian’s services are paid by the Company at the direction of the Compensation Committee of the Board chair. Although Meridian provides recommendations on the structure of our compensation programs, Meridian does not determine the amount or form of compensation for any of our Named Executive Officers. From time to time, Meridian may also provide advice to the Company, with knowledge and consent of the Compensation Committee.Committee of the Board. In those years when Meridian is not utilized by the Compensation Committee of ourthe Board, similar compensation analysis is performed by members of our in-house human capitalPeople and Culture department who have special expertise in executive compensation.
How We Use Peer Group, Survey, and Benchmark Data Each year, the Compensation Committee of the Board reviews the competitiveness of our compensation program against our peer group and market benchmarks. The Compensation Committee of the Board, with the assistance of Meridian,, identified identifies a new peer group of companies. TTEC’s current peer group includes: ● 8x8
● Amdocs Limited
● Avaya Holdings
● Black Knight, Inc.
● CSG Systems International
● EPAM Systems, Inc.
● ExlService Holdings, Inc.
● Five9
| ● Genpact, LTD
● ManTech International Corporation
● Open Text Corporation
● Sabre Corporation
● Sykes Enterprises, Inc.
● Tyler Technologies, Inc.
● Unisys Corporation
● Virtusa Corporation
|
During 2021,For use with 2023 pay decisions, the Compensation Committee of the Board, with the assistance of Meridian, reviewed the Company’s peer group previously established and determined to retain the currentgroup. The peer group without changes untilis designed to reflect relevant industries and companies within a reasonable range of TTEC’s Revenue and Operating Income, ideally positioning TTEC near the group’s median. In October 2022, the peer group iswas reviewed again in 2022. for 2023 pay decisions. As a result of the review, six companies were removed due to acquisition and limited data availability, and three companies were added to the peer group to include newly recognized business or segment peers.
This peer group was selected because the companies in the group are in the same or similar industries, competealso competes with us for executive talent followand follows similar compensation models and are of a similar size.models. The Compensation Committee of the Board reviewed the compensation practices of this peer group to effectively design compensation arrangements to attract new executives in our highly competitive, rapidly changing market and to confirm proper levels of compensation for our Named Executive Officers. ThisTTEC’s 2023 peer group, approved by the Compensation Committee of the Board in October 2022, includes:
| ● | CSG Systems International, Inc. |
| ● | ExlService Holdings, Inc. |
| ● | ManTech International Corp. |
| ● | TELUS International, Inc. |
Peer group data for executive officers performing the same or similar roles is one factor the Compensation Committee of the Board uses in establishing Named Executive Officer base salaries, and performance-based cash incentive and equity grants, and in otherwise determining the overall mix of equity grants, cash incentives, and base salaries for executive compensation. The Compensation Committee of the Board does not adhere to strict formulas or benchmarking in its review of this peer group data to determine the mix of our executive’s compensation elements. The peer group data is instructive, but it is neither binding nor a dispositive factor in how the Compensation Committee of the Board makes its compensation decisions for the Company.
CEO COMPENSATION
Mr. Tuchman, our Chief Executive Officer, beneficially owns 59.2 percent58.7% of the Company. His interest in the Company’s performance, therefore, is very closely and personally aligned with that of our other stockholders. At Mr. Tuchman’s request, the Compensation Committee of the Board approved Mr. Tuchman’s base salary to be $1 for 2021.2023. Mr. Tuchman’s salary has remained at this level since 2012. Under Mr. Tuchman’s employment agreement, he does not participate in our variable compensation plans. Accordingly, the Compensation Committee of the Board did not award any cash incentives or equity grants to Mr. Tuchman. 2023 BASE SALARY COMPENSATION FOR NAMED EXECUTIVE OFFICERS The Compensation Committee of the Board analyzed benchmarks for competitive base salaries using the peer group as the guide for the executive leadership team’sNamed Executive Officers’ base salaries. Based on these benchmarks, in 2021,effective January 1, 2023, the Compensation Committee approved a base salary increase for Mr. Erickson from $350,000 to $375,000. In 2021,of the Compensation CommitteeBoard approved a base salary increase for Mr. Semach from $400,000 to $500,000 and Ms. Swanback from $625,000 to $700,000 to reflect aupdated market data related to their change in responsibility associated with his new roleduties as Chief Financial Officer.
a result of their promotions. In February 2022,addition, the Compensation Committee of the Board approved salary increases for Mr. Bourret during 2023 to acknowledge his additional responsibilities as interim CFO. Ms. McLean received a base salary increase for Ms. Paolilloin July of 2023 to reflect a change in responsibility associated with her new role as Global Chief Operating Officer. align to market benchmarks. The Compensation Committee of the Board determined that the base salaries for other Named Executive Officers were appropriate, with the exception ofexcept for Mr. Tuchman’s base salary, which has been set at $1 based on Mr. Tuchman’s request. Base salaries for our Named Executive Officers during 2020, 20212022, 2023 and as of this filing for 20222024 have been as follows: Executive | Base Salary | Considerations for Base Salary Determination | | 2024 | 2023 | 2022 | | Kenneth D. Tuchman | $1 | $1 | $1 | At Mr. Tuchman’s request, his annual salary is $1. | Michelle “Shelly” R. Swanback | $700,000 | $700,000 | $625,000 | Based on the role, scope of responsibilities, and market benchmarks. | Francois Bourret 1 | $400,000 | $400,000 | $255,000 | Based on the role and scope of responsibilities as Interim CFO and Chief Accounting Officer. | Dustin J. Semach 2 | - | $500,000 | $400,000 | Based on the role, scope of responsibilities, and market benchmarks. | David J. Seybold | $625,000 | $625,000 | $625,000 | Based on the role, scope of responsibilities, and market benchmarks. | Margaret B. McLean | $420,000 | $420,000 | $390,000 | Based on the role, scope of responsibilities, and market benchmarks. |
Executive | Base Salary | Considerations for Base Salary Determination | | 2022 | 2021 | 2020 | | Kenneth D. Tuchman | $1 | $1 | $1 | At Mr. Tuchman’s request, his annual salary is $1. | Richard Sean Erickson | $375,000 | $375,000 | $350,000 | Based on the role, scope of responsibilities, and market benchmarks. | Judi A. Hand | $400,000 | $400,000 | $400,000 | Based on the role, scope of responsibilities, and market benchmarks for the senior executive in charge of sales. | Margaret B. McLean | $375,000 | $375,000 | $375,000 | Based on the role, scope of responsibilities, and market benchmarks. | Regina M. Paolillo | $475,000 | $425,000 | $425,000 | Based on complexity of the role and market benchmarks. | Dustin J. Semach | $400,000 | $400,000 | $375,000 | Based on complexity of the role and market benchmarks. |
| 1. | Mr. Bourret was appointed Interim Chief Financial Officer of the Company on March 17, 2023. |
| 2. | Mr. Semach resigned from his position as Chief Financial Officer of the Company and exited the Company effective April 14, 2023. |
PERFORMANCE-BASED CASH INCENTIVE AWARDS
Performance-Based Cash Incentives Funding Criteria The Compensation Committee of the Board resets the variable, annual cash incentive award funding targets at the beginning of each year. In 2021,For 2023, the Compensation Committee of the Board selected Pre-Bonus Adjusted Operating Income1 targets in setting our variable incentive funding because this target was consistent with the Company’s long-term growth objectives and aligned the interests of management with the interests of our stockholders. As part of its compensation philosophy, the Compensation Committee of the Board sets reasonable stretch targets that are difficult to achieve, but which it believes are achievable. Performance-Based Cash Award Funding and Adjusted Operating Income Results for 2020 Performance
With respect to cash incentives paid in 2021 related to 2020 performance, the Compensation Committee of our Board approved the funding of $29.4 million based on performance results against the 2020 Adjusted Operating Income targets as reflected in the table below. Based on the Company achievement of Adjusted Operating Income targets, Management recommended, and the Compensation Committee of the Board agreed to provide incremental funding to the 2020 bonus pool. The bonus pool for 2020 performance funded at 164 percent or $29.4 million.
With respect to cash incentives paid to the Named Executive Officers, the Compensation Committee approved awards of $2.8 million based on their performance against 2020 Adjusted Operating Income targets. The paid incentives of $2.8 million comprised of bonuses paid in the first quarter of 2021 for 2020 performance.
For purposes of determining the cash incentive funding for 2020 performance, the Compensation Committee made adjustments to 2020 results of operations due to foreign exchange fluctuations, which account for variance between FX rates used to set 2020 targets and the actual 2020 FX rates. The Compensation Committee determined that such adjustments were appropriate because these events were outside of direct control of the Company and the management team.
The 2020 Adjusted Operating Income results measured against the targets were as follows:
Performance-Based Cash
Incentive Funding Metrics | 2020 Target | 2020 Performance | 2020 Performance
– Adjusted for FX | Total Performance-Based Cash Award
Funding for 2020 Performance | Adjusted Operating Income | $174.9 million | $237.5 million | $238.8 million | $29.4 million |
Performance-Based Cash Award Funding and Adjusted Operating Income Results for 2021 Performance
With respect to cash incentives paid in 2021 and 2022 related to 2021 performance, the Compensation Committee of our Board approved the funding of $16.39 million based on performance results against the 2021 Adjusted Operating Income targets as reflected in the table below. The bonus pool funding of $16.39 million represented 83.8 percent of the target bonus opportunity based on each segment’s performance against their annual Adjusted Operating Income targets.
With respect to cash incentives paid to the Named Executive Officers, the Compensation Committee approved awards of $1.6 million based on their performance against 2021 Adjusted Operating Income targets. The paid incentives of $1.6 million comprised of bonuses paid in the third quarter of 2021 and the first quarter of 2022 for 2021 performance.
For purposes of determining the cash incentive funding for 2021 performance, the Compensation Committee made adjustments to 2021 results of operations due to foreign exchange fluctuations, which account for variance between FX rates used to set 2021 targets and the actual 2021 FX rates. The Compensation Committee determined that such adjustments were appropriate because these events were outside of direct control of the Company and the management team.
The 2021 Adjusted Operating Income results measured against the targets were as follows:
Performance-Based Cash
Incentive Funding Metrics | 2021 Target | 2021 Performance | 2021 Performance
– Adjusted for FX | Total Performance-Based Cash Award
Funding for 2021 Performance | Adjusted Operating Income | $242.7 million | $251.4 million | $244.9 million | $16.39 million |
1 | TTEC computes company performance metrics on a non-GAAP basis, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, deconsolidation of subsidiaries, changes in acquisition earn-outs, changes in tax valuation allowances, return to provision adjustments, and one-time non-recurring items. Please review a copy of the 2021 Annual Report and 2021 full-year earnings press release for a reconciliation of these non-GAAP adjustments. |
Individual Performance Targets and Awards for Performance-Based Cash Incentives If and when any cash incentives are available, based on the overall performance of the Company, how the funds are allocated to each Named Executive Officer is determined by the Compensation Committee of the Board, at its discretion, based on the recommendation of the Chief Executive Officer, and based on the Compensation Committee’sCommittee of the Board’s view of the executive’s contribution to the execution of the Company’s strategic priorities as set forth below: Strategic Priorities | Performance Objectives | ● Execute against our go to market strategy.
●
| Sign new business and grow revenue. | Maintain our market share in our key markets, with our key clients, in our offerings. ●
| Improve year-over-year operating income and free cash flow. | Deliver innovative solutions in emerging digital CX technology and services. ●
| Increase client satisfaction and retention. | Optimize how we do business (people, technology, and facilities). ●
| Increase employee satisfaction and retention. | Attract and retain the best CX talent. | ● Sign new business and grow revenue.
● Improved year-over-year operating income and free cash flow
● Increase client satisfaction and retention.
● Increase employee satisfaction and retention.
● Improve overhead efficiency.
|
Under the TTECTTEC’s pay-for-performance philosophy there is a clear correlation between the Company’s financial results of operations and the amount of the cash incentives payable to individual executives under the variable cash incentive plan, once the minimum target levels of financial performance necessary to fund the plan, as determined by the Compensation Committee of the Board, are achieved by the Company. The Compensation Committee of the Board has discretion, however, to adjustincrease cash incentives based on special circumstances and performance milestones that may not have translated into financial performance of a business segment or a function in a given year; yetyear if they nonetheless positioned the Company for material gains in the future; orfuture. The Compensation Committee of the Board also has discretion to reduce such incentives if an executive failed to meet specific goals. Our cash incentives provide for the adjustment or recovery of amounts paid to a Named Executive Officer if the results in a previous year are subsequently restated or adjusted in a manner that would have originally resulted in the payment of a smaller award.different amount.
We maintain an incentive recoupment (clawback) policy which was updated in 2023 to comply with NASDAQ listing standards implementing Exchange Act Rule 10D-1. Under this policy, if we are required to undergo an accounting restatement as the result of material noncompliance with financial reporting requirement under the securities laws, the Compensation Committee of the Board must, subject to limited exceptions, seek to recoup compensation received by a covered executive (including the Named Executive Officers) in excess of the amount the covered executive would have received based on the restated results. We may also pursue other remedies under applicable law, including disciplinary actions up to and including termination of employment, in addition to recouping any excess incentive compensation. 2023 Cash Award Funding and Pre-Bonus Adjusted Operating Income Results for 2022 Performance For purposes of determining the 2023 cash incentive funding for 2022 performance, the Compensation Committee of the Board adjusted 2022 results of operations due to foreign exchange fluctuations, which account for variance between foreign exchange (FX) rates used to set 2022 targets and the actual 2022 FX rates. The Compensation Committee of the Board determined that such adjustment was appropriate because these events were outside of direct control of the Company and the management team. The 2022 Pre-Bonus Adjusted Operating Income results measured against the targets were as follows: Performance-Based Cash Incentive Funding Metrics | 2022 Target | 2022 Performance | 2022 Performance – Adjusted for FX | Total Performance-Based Cash Award Funding for 2022 Performance | Pre-Bonus Adjusted Operating Income1 | $295.98 million | $197.8 million | $193.2 million | $7.77 million |
| 1. | TTEC presents company performance metrics on a non-GAAP basis to more accurately convey the performance of the business, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, cybersecurity incident-related costs, changes in acquisition contingent considerations, and one-time non-recurring items. |
Cash Incentives Paid in 2021 With Respect to 20202023 For 2022 Performance Due to COVID-19,While the Company made a decision for the 2020 performance year to eliminate the mid-year2022 cash incentive payouts and instead pay full-yearplan provided a minimal level of funding with respect to cash incentives once 2020 financials were finalized.
Thethat would have been paid in the first quarter of 2023 related to 2022 performance, the Compensation Committee awarded cash incentivesof the Board elected not to pay bonuses to the then NEOs based on performance results against the 2022 Pre-Bonus Adjusted Operating Income targets.
As Mr. Bourret was not a Named Executive OfficersOfficer in 2022, he was eligible for 2020 performance as follows:and did receive a cash incentive. Named Executive Officer | Target Cash Incentives % Base Salary | Cash Incentives Paid in 2020 for 2020 Performance | Cash Incentives Paid in 2021 for 2020 Performance | Total Incentive Paid for 2020 Performance | Basis for Cash Incentive Award | | Target | Actual | Actual | | | Kenneth D. Tuchman | 0% 1 | – | – | – | Under Mr. Tuchman’s employment agreement, he does not participate in this program. | Richard Sean Erickson | 60% | – | $155,000 | $155,000 | Based on Mr. Erickson’s contribution to the Company’s achievement of 2020 TTEC Engage performance targets. | Judi A. Hand | Up to 100% | – | $800,000 | $800,000 | Based on Ms. Hand’s contribution to TTEC’s achievement of 2020 performance targets, including year-over-year increase in bookings. | Margaret B. McLean | 76% | – | $487,350 | $487,350 | Based on Ms. McLean’s contribution to TTEC’s achievement of its 2020 performance targets and contributions to the execution of TTEC’s risk mitigation objectives. | Regina M. Paolillo | Up to 100% | – | $1,000,000 | $1,000,000 | Based on Ms. Paolillo’s contribution to TTEC achievement of 2020 performance targets, including significant contribution to strategy execution. | Dustin J. Semach | 60% 2 | – | – | – | N/A |
Named Executive Officer | Target Cash Incentives % Base Salary | Actual Cash Incentives Paid in 2023 for 2022 Performance | Cash Incentives as a % of Target | Basis for Cash Incentive Award | Kenneth D. Tuchman | 0% 1 | – | – | Under Mr. Tuchman’s employment agreement, he does not participate in this program. | Michelle “Shelly” R. Swanback | Up to 100% | -- | 0% | -- | Francois Bourret | Up to 40% | $54,000 | 58% | Based on Mr. Bourret’s achievement of 2022 performance goals. | Dustin J. Semach | Up to 100% | -- | 0% | -- | David J. Seybold | -- | -- | -- | Mr. Seybold was hired in November 2022 and was not eligible to participate in the incentive plan for 2022 performance. | Margaret B. McLean | Up to 75% | -- | 0% | -- |
| 11. | As noted elsewhere in these proxy materials, at Mr. Tuchman’s request, he does not participate in this program. | | 2 | Due to Mr. Semach’s hire date of December 7, 2020, he was not eligible to participate in the 2020 performance-based cash incentive plan. |
2024 Cash Award Funding and Pre-Bonus Adjusted Operating Income Results for 2023 Performance For purposes of determining the 2024 cash incentive funding for 2023 performance, the Compensation Committee of the Board adjusted 2023 results of operations due to foreign exchange fluctuations, which account for variance between FX rates used to set 2023 targets and the actual 2023 FX rates. The Compensation Committee of the Board determined that such adjustments were appropriate because these events were outside of direct control of the Company and the management team. Based on each segment’s performance against their annual Pre-Bonus Adjusted Operating Income targets, the Compensation Committee of the Board approved only the minimum funding level of $8 million. The 2023 Pre-Bonus Adjusted Operating Income results measured against the targets were as follows: Performance-Based Cash Incentive Funding Metrics | 2023 Target | 2023 Performance | 2023 Performance – Adjusted for FX | Total Performance-Based Cash Award Funding for 2023 Performance | Pre-Bonus Adjusted Operating Income1 | $249.6 million | $154.7 million | $165.1 million | $8 million | | | | | |
| 1. | TTEC presents company performance metrics on a non-GAAP basis to more accurately convey the performance of the business, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, cybersecurity incident-related costs, changes in acquisition contingent considerations, and one-time non-recurring items. |
Cash Incentives Paid in 2021 and 2022 With Respect to 20212024 For 2023 Performance In 2021 and 2022,2024, based on 2023 company financial performance, the Compensation Committee of the Board awarded $697,703 in cash incentives to the Named Executive Officers for 20212023 performance as follows: Named Executive Officer | Target Cash Incentives % Base Salary | Cash Incentives Paid in 2021 for 2021 Performance | Cash Incentives Paid in 2022 for 2021 Performance | Total Incentive Paid for 2021 Performance | Basis for Cash Incentive Award | | Target | Actual | Actual | | | Kenneth D. Tuchman | 0% 1 | – | – | – | Under Mr. Tuchman’s employment agreement, he does not participate in this program. | Richard Sean Erickson | 72% 2 | $104,515 | $156,773 | $261,288 | Based on Mr. Erickson’s contribution to the Company’s achievement of 2021 TTEC Engage performance targets. | Judi A. Hand | Up to 100% | $160,000 | $240,000 | $400,000 | Based on Ms. Hand’s contribution to TTEC’s achievement of 2021 performance targets. | Margaret B. McLean | 76% | $114,000 | $171,000 | $285,000 | Based on Ms. McLean’s contribution to TTEC’s achievement of 2021 performance targets. | Regina M. Paolillo | Up to 100% | $144,500 | $280,500 | $425,000 | Based on Ms. Paolillo’s contribution to TTEC achievement of 2021 performance targets, including significant contribution to strategy execution. | Dustin J. Semach | 71% 3 | $76,500 | $194,527 | $271,027 | Based on Mr. Semach’s contribution to TTEC achievement of 2021 performance targets |
Named Executive Officer | Target Cash Incentives % Base Salary | Actual Cash Incentives Paid in 2024 for 2023 Performance | Actual Cash Incentive as % of Base Salary | Basis for Cash Incentive Award | Kenneth D. Tuchman | 0% 1 | – | – | Under Mr. Tuchman’s employment agreement, he does not participate in this program. | Michelle “Shelly” R. Swanback | Up to 100% | $175,000 | 25% | Aligned with the minimum funding to recognize Ms. Swanback’s achievement of performance milestones. | Francois Bourret | Up to 40% | $32,453 | 25% | Aligned with the minimum funding to recognize Mr. Bourret’s achievement of performance milestones. | Dustin J. Semach 2 | – | – | – | – | David J. Seybold | Up to 100% | $156,250 | 25% | Aligned with the minimum funding to recognize Mr. Seybold’s achievement of performance milestones. | Margaret B. McLean | Up to 85% | $334,000 3 | 100% | To recognize specific one-time contributions to enterprise risk mitigation in 2023. |
| 11. | As noted elsewhere in these proxy materials, at Mr. Tuchman’s request, he does not participate in this program. |
| 22. | As Mr. Erickson’s incentive target representsSemach exited the proration from his previous incentive target and his updated incentive target thatCompany effective April 14, 2023, he was approved in 2021. The cash incentives paidnot eligible for 2021 performance were prorated based on the effective date of his compensation increase during the year, as approved by the Compensation Committee. | 3 | Mr. Semach’s incentive target represents the proration from his previous incentive target and his updated incentive target aligned with his promotion to Chief Financial Officer in 2021. His cash incentives paid for 2021 performance were prorated based on his time in each role during the year.an award. |
| 3. | Includes $90,000 aligned to minimum funding and $244,000 as a retention bonus in recognition of additional contributions. |
2023 Equity Grants Annual Grants In 2021, the Compensation Committee considered annual equity awards aligned to the Company’s 2020 performance, peer company benchmarks and each individual Named Executive Officer’s performance. Based on this review, and the2022 company performance, there was a minimum level of equity compensation pool based on the Company’s 2020 performance against financial targets, the Compensation Committee approvedfunding available in 2023 for annual restricted stock unit (RSU) grants toequity grants. The Compensation Committee of the Board determined that our then Named Executive Officers Mses. Hand, McLean,would not be eligible for an annual RSU grant in 2023 related to performance year 2022.
As Mr. Bourret was not a Named Executive Officer in 2022, he was eligible for and Paolillo, and Mr. Erickson.did receive an annual equity grant. Generally, the primary characteristics of TTEC annual RSUs granted to Executives are: | ● | Annual RSU grants vest in four-year increments with 25 percent25% of the award vesting on each of the award anniversary dates.anniversary. |
| ● | Executive officers must remainbe employed by the Company through the vesting date for each portion of the grant to vest. |
| ●The awards | Awards are structured to have a strong retention value and align executives’ interests to stockholders’ interests over a longer term. |
| ● | ●RSUs provide a long-term incentive to balance shorter-termshort-term incentives provided by cash awards and base salaries.
|
Named Executive Officer | 2021 FMV RSU Annual Grant | 2021 RSU Shares Granted | Considerations for 2021 Determination | Kenneth D. Tuchman 1 | – | – | Under Mr. Tuchman’s employment agreement, he does not participate in this program. | Richard Sean Erickson | $162,517 | 1,586 Shares | Mr. Erickson’s annual equity grant made in 2021 is based on his contribution and execution of established performance goals for performance year 2020. | Judi A. Hand | $603,343 | 5,888 Shares | Ms. Hand’s annual equity grant made in 2021 is based on her contribution and execution of established performance goals for performance year 2020. | Margaret B. McLean | $263,963 | 2,576 Shares | Ms. McLean’s annual equity grant made in 2021 is based on execution of established performance goals for performance year 2020. | Regina M. Paolillo | $754,179 | 7,360 Shares | Ms. Paolillo’s annual equity grant made in 2021 is based on her contribution and execution of established performance goals for performance year 2020. | Dustin J. Semach | – | – | N/A |
Named Executive Officer | 2023 FMV RSU Annual Grant | 2023 RSU Shares Granted | Considerations for 2023 Determination | Kenneth D. Tuchman 1 | – | – | Under Mr. Tuchman’s employment agreement, he does not participate in this program. | Michelle “Shelly” R. Swanback | -- | -- | | Francois Bourret | $34,985 | 953 | Based on Mr. Bourret’s 2022 performance contributions. | Dustin J. Semach | – | -- | Mr. Semach was ineligible as he left his position as Chief Financial Officer of the Company effective April 2023. | David J. Seybold | -- | -- | Mr. Seybold was hired in November 2022 and was not eligible for this annual RSU grant based on 2022 performance. | Margaret B. McLean | -- | -- | |
| 11. | As noted elsewhere in these Proxy materials, at Mr. Tuchman’s request, he does not participate in this program. |
Annual2023 Retention Grants
In 2023, in addition to our annual grant program, the Compensation Committee of the Board approved a special one-time retention grant to retain and motivate high-potential business-critical employees who were needed to support the business over the next 12 to 24 months. Both Mr. Bourret and Ms. McLean received a grant under this program with a grant date fair value of $34,985 and $59,984, respectively. 2023 Promotional Grants In connection with her promotion to President, TTEC Holdings, Inc., the Compensation Committee of the Board agreed to provide Ms. Swanback, in March 2023, a one-time $2 million RSU grantsequity grant, vesting in equal installments over a five-year period, and a $2 million performance-based equity grant, subject to a 3-year cliff vesting period. Ms. Swanback may earn between 0% to 200% of the performance-based equity award based on the achievement of the established financial targets for 2022 related2025. In connection with Mr. Bourret’s appointment to performance year 2021 for both Company and personal performance, have not yet been determined forinterim Chief Financial Officer, the Named Executive Officers.Compensation Committee of the Board agreed to provide him a one-time RSU grant of $400,000 vesting in four equal installments over a four-year period. Long-Term Incentive Plans (LTIP) In 2019, we restructured our equityOur executive compensation program for our Executive Officers. We introduced a long-term equity incentive opportunity based on the Company’s performance over a three-year period and bifurcated the previously available incentive opportunity that was based on annual performance metrics and vested over time. By emphasizing long-term growth objectives for Executive Officers’ compensation purposes, we continue to align their interests with the interests of our stockholders. The transition from the annual performance-based to multi-year performance-based equity incentive program was fully implemented 2019 thru 2021.
The Compensation Committee adoptedincludes a three-year long-term incentive program (the “LTIP”). Grants made under this LTIP program in 2019 and 2020 were designed to be transitional with shorter measurement periods; while the grants in 2021 are based on the entire three-year measurement period. Because of the transitional nature of 2019 and 2020 programs, eligible senior executives will have a catch-up opportunity if the Company’s performance in an individual measurement period is below an agreed threshold but meets or exceeds the threshold amount for the final measurement period.
The LTIP program provides select senior executives with an incentive opportunity in addition to TTEC’s regular annual RSU equity grant. In 2019, the Company implemented the LTIP and bifurcated the executive’s previous time-based equity grant opportunity to align to 50 percent time-based RSUs and 50 percent performance-based RSUs. The performance-based RSUs provide an opportunity for over performance of up to 200 percent.
Each performance-based equity award is aligned to company financial targets with a three-year measurement period. Under the award, each participant may earn between 0% to 200% of the award based on the achievement of the established financial targets.
2021 Long-Term Incentive Plan (LTIP) The 2019 LTIP was designed to provide equity awards to select senior executives for achievingIn March of 2021, the Compensation Committee of the Board approved performance metrics of Revenue and Adjusted Operating Income1 targets for threethe 2021 LTIP award. Each performance metric is weighted 50%. The 2021 LTIP has one measurement periods -- fiscal years 2019, 2020 and 2021, with one-thirdperiod – ending as of the total award opportunity aligned to eachend of fiscal year 2023 (three-year measurement period. period).
Each senior executive who is eligible to participate in the 20192021 LTIP was provided the opportunitymay earn between 0% to receive an equity award valued from 0 percent to 200 percent200% of the respective award target, dependingbased on the Revenue and Adjusted Operating Income performance of the Company during each of the three measurement periods. If earned, the equity awards are structured to be issued in March of the year following the measurement period year, with vesting atperiod. Under the time of2021 LTIP, the grant. The performance criteria, for the 2019 LTIP isat max target, are aligned with an average 10 percent10% annual growth rate in the Company’s Revenue and 10% annual growth rate in Adjusted Operating Income, compared to 2020 financial results, over the combined 2019-2021 period.three-year measurement period (2021-2023).
Adjusted Operating Income Targets | (amounts in millions) | 2019 | 2020 | 2021 | Award Opportunity | Adjusted Operating Income | CAGR | Adjusted Operating Income | CAGR | Adjusted Operating Income | CAGR | $117.50 | 10.70% | $122.50 | 7.45% | $127.50 | 6.32% | Threshold – 50% | $120.50 | 13.60% | $125.00 | 8.54% | $130.00 | 7.01% | Target – 100% | $123.00 | 15.90% | $128.00 | 9.84% | $133.00 | 7.82% | Above Target – 150% | $126.00 | 18.80% | $134.00 | 12.38% | $141.20 | 10.00% | Max Target – 200% |
Revenue Targets | Adjusted Operating Income1 Targets | Award Opportunity | (amounts in millions) | (amounts in millions) | 2023 | CAGR | 2023 | CAGR | $2,256.21 | 5.0% | $244.95 | 5.0% | Threshold – 50% | $2,354.29 | 6.5% | $255.60 | 6.5% | Target – 100% | $2,455.18 | 8.0% | $266.56 | 8.0% | Above Target – 150% | $2,594.12 | 10.0% | $281.64 | 10.0% | Max Target – 200% |
| 1. | TTEC presents company performance metrics on a non-GAAP basis to more accurately convey the performance of the business, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, cybersecurity incident-related costs, changes in acquisition contingent considerations, and one-time non-recurring items. |
Named Executive Officer | 2021 FMV Performance-Based Equity Grant | 2021 Target Performance- Based Equity Grant (in shares) 1 | Kenneth D. Tuchman 2 | - | - | Michelle “Shelly” R. Swanback 3 | - | - | Francois Bourret 4 | - | - | Dustin J. Semach 5 | - | - | David J. Seybold 6 | - | - | Margaret B. McLean | $174,996 | 2,069 |
| 1. | Shares were calculated based on the fair market value of the grant divided by the closing stock price of our common stock on the grant date. |
| 2. | As noted elsewhere in these proxy materials, at Mr. Tuchman’s request, he does not participate in this program. |
| 3. | Due to Ms. Swanback’s hire date in May 2022, she was not eligible to participate in the 2021 long-term incentive plan. |
| 4. | Mr. Bourret was not eligible to participate in this 2021 LTIP program. |
| 5. | Due to Mr. Semach’s termination in April 2023, his award was cancelled before the end of the measurement period. |
| 6. | Due to Mr. Seybold’s hire date in November 2022, he was not eligible to participate in the 2021 long-term incentive plan. |
With respect to the 20202023 measurement period of the 2021 LTIP, senior executives earned 200 percent75% of their targets.target award. In determining the Company’s 20202023 achievement under the LTIP, funding, the only adjustment the Compensation Committee of the Board considered was foradjustments related to foreign exchange fluctuations (the variance between foreign exchange rate estimates used to set 20202023 performance targets and the actual 20202023 foreign exchange rates). The Compensation Committee of the Board determined that such adjustments were appropriate because these events were outside of direct control of the Company and the management team and could not have been reasonably anticipated by them. Based on the Company’s 2020 Adjusted Operating Income2023 Revenue and the terms of 2019the 2021 LTIP, the Revenue component (weighted 50%) was earned at 150% of target, while no portion of the Adjusted Operating Income component of the award was earned. 2023 Long-Term Incentive Plan (LTIP) In March of 2023, the Compensation Committee of the Board approved $1.1 millionperformance metrics of funding under the plan for all participants including $717,000 in funding to our Named Executive Officers. The 2020Revenue and Adjusted Operating Income results measured against the targets setearnings before interest, taxes, depreciation and amortization1 (Adjusted EBITDA) for the 20202023 LTIP award. Each performance metric is weighted 50%. The 2023 LTIP has one measurement period were– ending as follows:of the end of fiscal year 2025 (three-year measurement period).
Each senior executive eligible to participate in the 2023 LTIP may earn between 0% to 200% of the award target, based on achievement to the established Revenue and Adjusted EBITDA targets for fiscal year 2025. Under the 2023 LTIP, the performance criteria, at max target, are aligned with an average 8.6% annual growth rate in the Company’s Revenue and 10.3% annual growth rate in Adjusted EBITDA, compared to 2022 financial results, over the three-year measurement period (2023-2025). Revenue Targets | Adjusted EBITDA Targets1 | Award Opportunity | (amounts in millions) | (amounts in millions) | 2025 | CAGR | 2025 | CAGR | $2,880 | 5.6% | $393 | 6.4% | Threshold – 50% | $2,957 | 6.6% | $408 | 7.7% | Target – 100% | $3,046 | 7.6% | $423 | 9.0% | Above Target – 150% | $3,128 | 8.6% | $438 | 10.3% | Max Target – 200% |
| 2019 Performance-Based
LTIP Metric for 2020
Performance Year2020 Target | 2020 Performance | 2020 Performance –
Adjusted for FX | Total Performance-Based Cash Award
Funding for 2020 Performance | Adjusted Operating Income | $125.0 million | $210.3 million | $211.6 million | $1.1 million |
| 11. | TTEC computespresents company performance metrics on a non-GAAP basis to more accurately convey the performance of the business, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, deconsolidation of subsidiaries,cybersecurity incident-related costs, changes in acquisition earn-outs, changes in tax valuation allowances, return to provision adjustments,contingent considerations, and one-time non-recurring items. Please review a copy of the 2021 Annual Report and 2021 full-year earnings press release for a reconciliation of these non-GAAP adjustments. |
Named Executive Officer | 2021 FMV RSU Grant
Earned for 2020 Performance
Measurement Period Two
| 2021 RSU Grant
Earned for 2020 Performance
Measurement Period Two
| Considerations for Determination | Kenneth D. Tuchman 1 | - | - | Mr. Tuchman does not participate in this program. | Richard Sean Erickson 2 | - | - | N/A | Judi A. Hand | $266,681 | 3,153 Shares | The grant issued March 2021 is based on over achievement to pre-established Adjusted Operating Income targets for performance year 2020. | Margaret B. McLean | $116,636 | 1,379 Shares | The grant issued March 2021 is based on over achievement to pre-established Adjusted Operating Income targets for performance year 2020. | Regina M. Paolillo | $333,330 | 3,941 Shares | The grant issued March 2021 is based on over achievement to pre-established Adjusted Operating Income targets for performance year 2020. | Dustin J. Semach 3 | - | - | N/A |
| 1 | As noted elsewhere in these proxy materials, at Mr. Tuchman’s request, he does not participate in this program. |
| 2 | Due to Mr. Erickson’s hire date in September 2020, he was not eligible to participate in the 2019 long-term incentive plan. |
| 3 | Due to Mr. Semach’s hire date in December 2020, he was not eligible to participate in the 2019 long-term incentive plan. |
Named Executive Officer | 2023 FMV Performance-Based Equity Grant | 2023 Target Performance- Based Equity Grant (in shares) 1 | Kenneth D. Tuchman 2 | - | - | Michelle “Shelly” R. Swanback | $3,249,993 3 | 89,261 | Francois Bourret 4 | - | - | Dustin J. Semach 5 | - | - | David J. Seybold | $312,507 | 8,583 | Margaret B. McLean | $210,013 | 5,768 |
With respect to the 2021 measurement period, senior executives earned 200 percent of their targets. In determining the Company’s 2021 LTIP funding, the Compensation Committee considered adjustments related to foreign exchange fluctuations (the variance between foreign exchange rate estimates used to set 2021 performance targets and the actual 2021 foreign exchange rates) as well costs related to acquisitions. The Compensation Committee determined that such adjustments were appropriate because these events were outside of direct control of the Company and the management team and could not have been reasonably anticipated by them.
Based on the Company’s 2021 Adjusted Operating Income and the terms of 2019 LTIP, the Compensation Committee approved $975,000 in total funding for all participants including $717,000 in funding to our Named Executive Officers.
The 2021 Adjusted Operating Income results measured against the targets set for the 2021 measurement period were as follows:
| 2019 Performance-Based
LTIP Metric for 2021
Performance Year2021 Target | 2021 Performance | 2021 Performance
– Adjusted for FX
and Acquisition
Costs | Total Performance-Based Cash Award
Funding for 2021 Performance | Adjusted Operating Income | $130.0 million | $233.5 million | $228.1 million | $975,000 |
Named Executive Officer | 2022 FMV RSU Grant
Earned for 2021 Performance
Measurement Period Three
| 2022 RSU Grant
Earned for 2021 Performance
Measurement Period Three
| Considerations for Determination | Kenneth D. Tuchman 1 | - | - | Mr. Tuchman does not participate in this program. | Richard Sean Erickson 2 | - | - | N/A | Judi A. Hand | $266,671 | 3,526 Shares | The grant issued March 2022 is based on over achievement to pre-established Adjusted Operating Income targets for performance year 2021. | Margaret B. McLean | $116,697 | 1,543 Shares | The grant issued March 2022 is based on over achievement to pre-established Adjusted Operating Income targets for performance year 2021. | Regina M. Paolillo | $333,301 | 4,407 Shares | The grant issued March 2022 is based on over achievement to pre-established Adjusted Operating Income targets for performance year 2021. | Dustin J. Semach 3 | - | - | N/A |
| 1 | As noted elsewhere in these proxy materials, at Mr. Tuchman’s request, he does not participate in this program. |
| 2 | Due to Mr. Erickson’s hire date in September 2020, he was not eligible to participate in the 2019 long-term incentive plan. |
| 3 | Due to Mr. Semach’s hire date in December 2020, he was not eligible to participate in the 2019 long-term incentive plan. |
2020 Long-Term Incentive Plan (LTIP)
In February of 2020, the Compensation Committee approved performance targets for the 2020 LTIP award as follows: Revenue and Adjusted Operating Income1 with each performance target weighted 50 percent. The 2020 LTIP includes two measurement periods -- fiscal years 2021 and 2022, with one-half of the total award opportunity aligned to each measurement period.
Each senior executive eligible to participate in 2020 LTIP may earn between 0 percent to 200 percent of the award target, based on the Revenue and Adjusted Operating Income performance of the Company during each measurement period.
The performance criteria for the 2020 LTIP are aligned with an average 10 percent annual growth rate in the Company’s Revenue, compared to 2019, and with Adjusted Operating Income expanding at a premium over the Revenue growth rate, at a 13.5 percent annual growth rate in Adjusted Operating Income, over the combined 2020-2022 period.
Revenue Targets | Adjusted Operating Income Targets | Award Opportunity | (amounts in millions) | (amounts in millions) | 2021 | CAGR | 2022 | CAGR | 2021 | CAGR | 2022 | CAGR | $1,829.50 | 5.5% | $1,930.10 | 5.5% | $147.90 | 7.0% | $158.30 | 7.0% | Threshold – 50% | $1,864.30 | 6.5% | $1,985.50 | 6.5% | $152.10 | 8.5% | $165.00 | 8.5% | Target – 100% | $1,917.20 | 8.0% | $2,070.60 | 8.0% | $157.80 | 10.5% | $174.30 | 10.5% | Above Target – 150% | $1,988.90 | 10.0% | $2,187.80 | 10.0% | $166.40 | 13.5% | $188.90 | 13.5% | Max Target – 200% |
Named Executive Officer | 2020 FMV Performance- Based Equity Grant | 2020 Target Performance- Based Equity Grant (in shares) 1 | Kenneth D. Tuchman 2 | - | - | Richard Sean Erickson 3 | $ 97,470 | 1,800 | Judi A. Hand | $399,994 | 9,811 | Margaret B. McLean | $174,985 | 4,292 | Regina M. Paolillo | $500,003 | 12,264 | Dustin J. Semach 4 | - | - |
| 11. | Shares were calculated based on the fair market value of the grant divided by the closing stock price of our common stock on the grant date. |
| | 22. | As noted elsewhere in these proxy materials, at Mr. Tuchman’s request, he does not participate in this program. |
| 3. | 3Includes annual PRSU grant of $1,249,992 and one-time promotional PRSU grant of $2,001,000. | | 4. | Mr. Erickson received a prorated performance-based equity grant based on his hire date in 2020. |
| 4 | Due to Mr. Semach’s hire date in December 2020, heBourret was not eligible to participate in the 2020 long-term incentive plan.this 2023 LTIP program. | | 5. | Mr. Semach did not receive an award under this 2023 LTIP program. |
With respect to the 2021 measurement period, senior executives earned 200 percent of their targets. In determining the Company’s 2021 achievement under the LTIP,2022 Value Creation Program
As previously disclosed in 2023 Proxy Materials, in 2022, the Compensation Committee considered adjustments related to foreign exchange fluctuations (the variance between foreign exchange rate estimates used to set 2021 performance targets and the actual 2021 foreign exchange rates) as well costs related to acquisitions. The Compensation Committee determined that such adjustments were appropriate because these events were outside of direct control of the Company and the management team and could not have been reasonably anticipated by them. Based on the Company’s 2021 Adjusted Operating Income and the terms of 2020 LTIP, the Compensation CommitteeBoard approved the settlement of 37,674 sharesa one-time equity incentive program, known as a value creation program or VCP, that was designed to create an opportunity for all participantsa few senior executives, including 28,168 performance-based restricted stock units to the Named Executive Officers.
The 2021 Adjusted Operating Income results measured against the targets set for the 2021 measurement period were as follows:
2020 LTIP Metrics for 2021
Performance Year | 2021 Target | 2021 Performance | 2021 Performance
– Adjusted for FX
and Acquisition
Costs | Total Performance-Based Restricted Stock
Unit Settlement for 2021 Performance | Adjusted Operating Income | $152.1 million | $233.5 million | $228.1 million | 18,837 | Revenue | $1,864.3 million | $2,273.1 million | $2,285.8 million | 18,837 |
| 1 | TTEC computes company performance metrics on a non-GAAP basis, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, deconsolidation of subsidiaries, changes in acquisition earn-outs, changes in tax valuation allowances, return to provision adjustments, and one-time non-recurring items. Please review a copy of the 2021 Annual Report and 2021 full-year earnings press release for a reconciliation of these non-GAAP adjustments. |
2021 Long-Term Incentive Plan (LTIP)
In March of 2021, the Compensation Committee approved performance metrics of Revenue and Adjusted Operating Income1 for the 2021 LTIP award. Each performance metric is weighted 50 percent. The 2021 LTIP has one measurement period – end of fiscal year 2023 (three-year measurement period).
Each senior executive eligible to participate in the 2021 LTIP may earn between 0 percent to 200 percentsome of the award target, based on the Revenue and Adjusted Operating Income performance of the Company during the measurement period.
Under the 2021 LTIP, the performance criteria areNEOs, to receive equity grants aligned with an average 10 percent annual growth rate in the Company’s Revenue and 10 percent annual growth rate in Adjusted Operating Income, compared to 2020 financial results, over the three-year measurement period (2021-2023).
Revenue Targets | Adjusted Operating Income Targets | Award Opportunity | (amounts in millions) | (amounts in millions) | 2023 | CAGR | 2023 | CAGR | $2,256.21 | 5.0% | $244.95 | 5.0% | Threshold – 50% | $2,354.29 | 6.5% | $255.60 | 6.5% | Target – 100% | $2,455.18 | 8.0% | $266.56 | 8.0% | Above Target – 150% | $2,594.12 | 10.0% | $281.64 | 10.0% | Max Target – 200% |
| 1 | TTEC computes company performance metrics on a non-GAAP basis, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, deconsolidation of subsidiaries, changes in acquisition earn-outs, changes in tax valuation allowances, return to provision adjustments, and one-time non-recurring items. Please review a copy of the 2021 Annual Report and 2021 full-year earnings press release for a reconciliation of these non-GAAP adjustments. |
Named Executive Officer | 2021 FMV Performance- Based Equity Grant | 2021 Target Performance- Based Equity Grant (in shares) 1 | Kenneth D. Tuchman 2 | - | - | Richard Sean Erickson | $104,964 | 1,241 | Judi A. Hand | $399,979 | 4,729 | Margaret B. McLean | $174,996 | 2,069 | Regina M. Paolillo | $500,037 | 5,912 | Dustin J. Semach | $112,491 | 1,330 |
| 1 | Shares were calculated based on the fair market value of the grant divided by the closing stock price of our common stock on the grant date. |
| 2 | As noted elsewhere in these proxy materials, at Mr. Tuchman’s request, he does not participate in this program. |
2022 Long-Term Incentive Plan (LTIP)
In March of 2022, the Compensation Committee approved performance metrics of Revenuestretch revenue and adjusted earnings before interest, taxes, depreciation and amortization1 (Adjusted EBITDA) for the Company, and measured based on the Company’s performance during 2022 LTIP award. Each performance metric is weighted 50 percent. The 2022 LTIP has one measurement period – end of fiscal year 2024 (three-year measurement period).
Each senior executive eligiblethrough 2025 period. Executives were selected to participate in the 2022 LTIP may earn between 0 percentprogram based on their direct ability to 200 percentimpact the performance of the award target, based on the Revenue and Adjusted EBITDA of the Companybusiness during the measurement period.period.
Under the 2022 LTIP, the performance criteria are aligned with an average 9.8 percent annual growth rate in the Company’s Revenue and 12.1 percent annual growth rate in Adjusted EBITDA, compared to 2021 financial results, over the three-year measurement period (2022-2024).EMPLOYMENT AGREEMENTS
Revenue Targets | Adjusted EBITDA Targets | Award Opportunity | (amounts in millions) | (amounts in millions) | 2024 | CAGR | 2024 | CAGR | $2,767.4 | 6.8% | $442.30 | 8.6% | Threshold – 50% | $2,845.7 | 7.8% | $454.70 | 9.6% | Target – 100% | $2,925.5 | 8.8% | $470.60 | 10.9% | Above Target – 150% | $3,006.7 | 9.8% | $486.90 | 12.1% | Max Target – 200% |
1 | TTEC computes company performance metrics on a non-GAAP basis, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, deconsolidation of subsidiaries, changes in acquisition earn-outs, changes in tax valuation allowances, return to provision adjustments, and one-time non-recurring items. Please review a copy of the 2021 Annual Report and 2021 full-year earnings press release for a reconciliation of these non-GAAP adjustments. |
Named Executive Officer | 2022 FMV Performance- Based Equity Grant | 2022 Target Performance- Based Equity Grant (in shares) 1 | Kenneth D. Tuchman 2 | - | - | Richard Sean Erickson | $149,974 | 1,983 | Judi A. Hand | $400,007 | 5,289 | Margaret B. McLean | $175,008 | 2,314 | Regina M. Paolillo | $674,998 | 8,925 | Dustin J. Semach | $199,966 | 2,644 |
| 1 | Shares were calculated based on the fair market value of the grant divided by the closing stock price of our common stock on the grant date. |
| 2 | As noted elsewhere in these proxy materials, at Mr. Tuchman’s request, he does not participate in this program. |
Employment Agreements
As a matter of policy, the Company does not usually enter into employment agreements, except with members of the executive leadership team, in circumstances when it is required to do so by law, in connection with acquisitions, or in special circumstances when managementthe Company believes that such agreements are necessary to attract an executive or retain an executive in highly competitive market conditions. The Compensation Committee of the Board reviews, but is not required to approve, employment agreements with senior executive officers, except agreements with our Chief Executive Officer, andthe Chief Financial Officer, and the direct reports of the Chief Executive Officer. The primary terms of our employment arrangement with our Named Executive Officers are summarized below. Tuchman Agreement
TTEC entered into an employment agreement with Mr.
Tuchman in 2001.Agreement | ● | •TTEC entered into an employment agreement with Mr. Tuchman in 2001. | | ● | Base Salary and Incentives. Pursuant to the terms of the agreement, Mr. Tuchman is entitled to base salary, annual cash, and equity incentives. But beginning in 2012, Mr. Tuchman requested that the Compensation Committee limit his base compensation to $1 and awardedaward him no annual cash or equity incentives. |
| ● | • | Benefits. Mr. Tuchman and members of his family are entitled to participate in all TTEC employee benefits at the Company’s expense. |
| ● | • | Life Insurance.Insurance. The Company agreed to provide Mr. Tuchman with a $4 million term life insurance policy, premiums fully paid by the Company. The policy and its proceeds are owned by Mr. Tuchman and may continue post termination of employment, subject to Mr. Tuchman paying all the premiums. |
| ● | • | Severance.Severance. Subject to customary releases, Mr. Tuchman is entitled to severance in the amount of 24 months of base pay, if he is terminated without cause or terminates his employment for “good reason.” |
| ● | • | Change in Control Provisions.Provisions. The employment agreement includes change in control provisions that result in accelerated vesting of all unvested equity awarded to Mr. Tuchman, subject to certain conditions that have been superseded by change in control provisions of specific equity grant documents (see, “Executive“Executive Compensation Tables - Potential Payments upon Termination or Change in Control.”Control” section of the Proxy Statement). |
| ● | • | Non-Disparagement.Non-Disparagement. The agreement provides that on separation of affiliation, whatever the reason, TTEC will refrain from any comments regarding Mr. Tuchman and his affiliation with TTEC. A breach of this provision provides for a $200,000 liquidated damages payment. Mr. Tuchman is similarly precluded from making disparaging comments about the Company. |
PaolilloSwanback Agreement
TTEC entered into an amended and restated employment agreement with Ms. Paolillo in 2018, to replace her prior 2011 employment arrangement.
| ● | •TTEC entered into an employment agreement with Ms. Swanback in May 2022, when she joined the Company as chief executive officer for the TTEC Engage business segment, and thereafter amended that agreement effective January 2023, to reflect Ms. Swanback’s additional responsibilities as President TTEC Holdings, Inc. | | ● | Base Salary. Pursuant to the terms of the agreement,Salary. Ms. Paolillo is entitled to receiveSwanback’s annual base salary of $425,000is $700,000 amended from time to time at the Company’sCompensation Committee of the Board’s discretion. |
| ● | • | Annual Cash Incentives. Ms. PaolilloSwanback is eligible to participate in the Company’s annual variable cash incentive plan of up to 100% of her base salary. The opportunity is tied to the annual targets and goals of the business as set by the Company’s CEO and the Board of Directors. Ms. Swanback’s annual award, if any, will be based on a combination of metrics tied to the overall performance of the Company and her individual performance. | | ● | Equity Grants. Ms. Swanback is eligible to participate in the Company’s annual equity program with a $2.5 million grant opportunity. The actual amount of the equity opportunity to be awarded is not guaranteed. It is based on TTEC’s overall performance, the performance of the TTEC Engage business segment for which Ms. Swanback is directly responsible, and her individual performance against annual goals set by the Company’s Board of Directors. The Board of Directors has discretion to modify the structure of the equity opportunity, as long as the overall benefit is not materially impacted. Currently, the equity opportunity is structured as a time-based equity grant of up to $1.25 million, vesting over three to four years; and a performance- based equity grant with a $1.25 million target and a payout of between 0 and 200%, depending on the Company’s performance over a three-year measurement period. | | ● | One Time Welcome Equity Grant. At the start of her employment as the CEO of TTEC Engage, Ms. Swanback was granted time-based restricted stock units with a market value of $4.5 million based on TTEC stock’s fair market value at the time of the grant. This one-time grant vests in five installments, on the anniversaries of the grant. | | ● | Benefits. Ms. Swanback is entitled to participate in all customary wellness benefits offered to TTEC executives. No special perquisites are included in Ms. Swanback’s compensation arrangement. | | ● | Severance. Subject to customary releases, if Ms. Swanback is terminated without cause or for “good reason” by the Company, she is entitled to severance in the amount of 18 months of base salary and 12 months of benefits continuation. |
| ● | Change in Control Provision. The agreement provides that Ms. Swanback is terminated without cause or for “good reason” during the period starting three months prior to and 15 months following a change in control event, Ms. Swanback will receive a change in control benefit of 2x of base salary and 12 months of continuation of benefits; Ms. Swanback will also be entitled to the acceleration of vesting for all equity grants held at the time of such termination, including performance-based equity grants with variable value, with value for vesting purposes to be set at target. |
Seybold Agreement | ● | TTEC entered into an employment agreement with Mr. Seybold effective December 2022, when he joined the Company as chief executive officer for TTEC Digital business segment, and thereafter amended that agreement effective January 2023, to reflect Mr. Seybold’s broader responsibilities in the business. | | ● | Base Salary. Mr. Seybold’s annual base salary is $625,000 amended from time to time at the Compensation Committee of the Board’s discretion. | | ● | Annual Cash Incentives. Mr. Seybold is eligible to participate in the Company’s annual variable cash incentive plan of up to 100% of his base salary. The opportunity is tied to the annual targets and goals of the business, as set by the Company’s CEO and the Board of Directors. Mr. Seybold’s annual award, if any, will be based on a combination of metrics tied to the overall performance of the Company, the TTEC Digital business segment’s performance and his individual performance. | | ● | Equity Grants. Mr. Seybold is eligible to participate in the Company’s annual equity program with $1.0 million grant opportunity. The actual amount of the equity opportunity to be awarded is not guaranteed. It is based on TTEC’s overall performance, the performance of the TTEC Digital business segment for which Mr. Seybold is directly responsible, and his individual performance against annual goals set by the Company’s Board of Directors. The Board of Directors has discretion to modify the structure of the equity opportunity, as long as the overall benefit is not materially impacted. Currently, the equity opportunity is structured as a time-based equity grant of up to $312,500, vesting over three to four years; and a performance-based equity grant with a $687,500 target, of which $412,500 target including a payout between 0 and 200% will depend on TTEC Digital’s business segment performance over a three year measurement period, and a $272,000 target including a payout of between 0 and 200% will depend on the Company’s performance over a three-year measurement period; payout possible between 0 and 200% of target. | | ● | One Time Welcome Equity Grant. At the start of his employment, Mr. Seybold was granted time-based restricted stock units with a market value of $3.0 million based on TTEC stock’s fair market value at the time of the grant. This one-time grant vests in five installments, on the anniversaries of the grant. | | ● | Benefits. Mr. Seybold is entitled to participate in all customary wellness benefits offered to TTEC executives. No special perquisites are included in Mr. Seybold’s compensation arrangement. | | ● | Severance. Subject to customary releases, if Mr. Seybold is terminated without cause or for “good reason” by the Company, he is entitled to severance in the amount of 18 months of base salary and 18 months of benefits continuation. | | ● | Change in Control Provision. The agreement provides that if Mr. Seybold is terminated without cause or for “good reason” during the period starting three months prior to and 15 months following a change in control event, Mr. Seybold will receive a change in control benefit of 2x of base salary and 24 months of continuation of benefits; Mr. Seybold will also be entitled to the acceleration of vesting for all equity grants held at the time of such termination, including performance-based equity grants with variable value, with value for vesting purposes to be set at target. |
Bourret Agreement | ● | TTEC entered into an employment agreement with Mr. Bourret in September 2023, in connection with his appointment as acting TTEC Chief Financial Officer. Upon the appointment of Mr. Wagers as TTEC’s Chief Financial Officer, Mr. Bourret’s employment with the Company will continue, subject to this employment agreement, as TTEC Chief Accounting Officer. | | ● | Base Salary. Mr. Bourret is entitled to receive a base salary of $400,000 amended from time to time at the Compensation Committee of the Board’s discretion. | | ● | Annual Cash Incentives. Mr. Bourret is eligible to participate in the Company’s annual variable cash incentive plan up to 100 percent40% of Base Salary.base salary. The opportunity is not guaranteed and is tied to the annual targets and goals of the business as set by the CEO and the Company’s Board of Directors. Ms. Paolillo’s annual award, if any, will be based onThe Company also agreed to provide Mr. Bourret with a combinationone-time cash bonus in the aggregate amount of metrics tied to the overall results of the business and her individual performance.$300,000 payable in three installments. |
| ● | • | Equity Grants. Eligible Mr. Bourret is eligible to participate in the Company’s annual equity program with $160,000 grant with an opportunity of up to $1 million (“Equity Grant Opportunity”).opportunity. The actual amount of the annual equity grantopportunity to be awarded is discretionary and not guaranteed and is based on TTEC’s performance overall,a combination of metrics reflecting targets and goals of the performance of TTEC’s enterprise services organization for which Ms. Paolillo is responsible,business set and her individual performance against targets setapproved by the CEO and Company’s Board of Directors annually. The Board of Directors has discretion to modify the structure of this equity grant opportunity provided that the overall benefit is not materially impacted. In 2019, the Compensation Committee of the Board restructured this equity grant opportunity into two separate opportunities, each with a target award equal to 50 percent of the Equity Grant Opportunity. The original equity opportunity, now of up to $500,000, remained unchanged, while the new long-term equity incentive opportunity of 0 percent to 200 percent of the remaining $500,000 is based on a three-year performance target. |
The Compensation Committee of the Board may grant additional cash or equity to Ms. Paolillo to incentivize his performance on a standalone basis or as part of TTEC executive leadership team, from time to time.
| ● | • | Benefits. Ms. PaolilloBenefits. Mr. Bourret is entitled to participate in all customary wellness benefits provided, however, that the Company will pay premiums for her $4 million life insurance policy for the duration of employment with the Company.offered to TTEC executives. No special perquisites were included in Mr. Bourret’s compensation arrangement. |
| ● | • | Severance.Severance. Subject to customary releases, Ms. PaolilloMr. Bourret is entitled to severance in the amount of 1812 months of Base Salarybase salary and 12 months benefits continuation, if shehe is terminated without cause or through “constructive termination” by the Company or by Mr. Bourret for “good reason”. With Mr. Bourret’s decision to resign, these provisions will no longer be relevant. | | ● | Change in Control Provision. The agreement provides that if Mr. Bourret is terminated without cause or for good reason. |
| • | Change“good reason” during the period starting three months prior to and 12 months following a change in Control Provision. The agreement provides forcontrol event, Mr. Bourret will receive a change in control benefit equal to 2.5x of her Base Salary,1x of base salary and 12 months of continuation of benefits, providedbenefits; Mr. Bourret will also be entitled to the executive is terminated without cause during three months prior to and 24 months following such change in control event and acceleration of vesting for all equity grants held at the time of such termination. |
| • | 2022 Compensation Change. In 2022, the Compensation Committee of the Board modified Ms. Paolillo’s compensationtermination, including performance-based equity grants with variable value, with value for vesting purposes to reflect the change in her rolebe set at target. With Mr. Bourret’s decision to resign or in the company. Effective 2022, her base compensation is $475,000; her annual cash incentive bonus eligibility is up to 100 percent of her base compensation;event the Company appoints a new Chief Financial Officer, these provisions will no longer be relevant. |
McLean Agreement | ● | TTEC entered into an amended and her annual equity grant eligibility is up to $1,350,000; with 50 percent of her equity grant opportunity aligned to time-based RSUs and 50 percent of the equity opportunity aligned to performance-based RSUs. Ms. Paolillo’srestated employment agreement with the Company will be updatedMs. McLean in due course2018, to reflect these changes.replace her prior employment arrangement from 2016. |
Hand Agreement
TTEC entered into an amended and restated employment agreement with Ms. Hand in 2018, to replace her prior employment arrangement from 2016.
| ● | • | Base Salary. Ms. Hand is entitled to receive a base salary of $400,000 amended from time to time at the Company’s discretion. |
| • | Annual Cash Incentives. Ms. Hand is eligible to participate in the Company’s annual variable incentive plan with an opportunity up to $400,000. The opportunity is tied to the annual targets and goals of the business as set by the CEO and the Company’s Board of Directors. Ms. Hand’s annual award, if any, will be based on a combination of metrics tied to the overall results of the business, sales performance, and her individual performance. |
| • | Equity Grants. Ms. Hand is eligible to participate in the Company’s annual equity grant with an opportunity of up to $800,000. The actual amount of the annual equity grant to be awarded is discretionary and not guaranteed, and is based on TTEC’s performance overall, the performance of the business function for which Ms. Hand is responsible, and Ms. Hand’s individual performance against targets set by the Company’s Board of Directors annually. The Board of Directors has discretion to modify the structure of this equity grant opportunity provided that the overall benefit is not materially impacted. In 2019, the Compensation Committee of the Board restructured this equity grant opportunity into two separate opportunities, each with a target award equal to 50 percent of the Equity Grant Opportunity. The original equity opportunity, now of up to $400,000 remained unchanged, while the new long-term equity incentive opportunity of 0 percent to 200 percent of the remaining $400,000 is based on a three-year performance target. |
The Compensation Committee of the Board may grant additional cash or equity to Ms. Hand to incentivize her performance on a standalone basis or as part of TTEC executive leadership team, from time to time.
| • | Benefits. Ms. Hand is entitled to participate in all customary benefits. In addition, Ms. Hand is also eligible to participate in the Company’s annual executive physical program and the Company will pay premiums on her $4 million life insurance policy. |
| • | Severance. Subject to customary releases, Ms. Hand is entitled to severance in the amount of 18 months of Base Salary and 12 months benefit continuation, if she is terminated without cause or terminates her employment for good reason. |
| • | Change in Control Provision. The agreement provides for change in control benefit equal to 2.5x of her Base Salary, 12 months of continuation of benefits, provided the executive is terminated without cause during three months prior to and 24 months following such change in control event and acceleration of vesting for all equity grants held at the time of such termination. |
McLean Agreement
TTEC entered into an amended and restated employment agreement with Ms. McLean in 2018, to replace her prior employment arrangement from 2016.
| • | Base Salary. Ms. McLean is entitled to receive a base salary of $375,000$420,000 amended from time to time at the Company’s discretion. |
| ● | • | Annual Cash Incentives. Ms. McLean is eligible to participate in the Company’s annual variable incentive plan with an opportunity up to $285,000.of 85% of base salary. The opportunity is tied to the annual targets and goals of the business as set by the CEO and the Company’s Board of Directors. Ms. McLean’s annual award, if any, will be based on a combination of metrics tied to the overall results of the business and her individual performance. |
| ● | • | Equity Grants. Ms. McLean is eligible to participate in the Company’s annual equity grant with an opportunity of up to $350,000.100% of base salary. The actual amount of the annual equity grant to be awarded is discretionary and not guaranteed and is based on TTEC’s performance overall and Ms. McLean’s individual performance against targets set by the Company’s Board of Directors annually. The Board of Directors has discretion to modify the structure of this equity grant opportunity provided that the overall benefit is not materially impacted. In 2019,Currently, the equity opportunity is structured as follows: up to 50% of base salary is a time-based equity grant, vesting over three to four years; and a performance-based equity grant with a target at 50% of base salary and a payout of between 0 and 200%, depending on the Company’s performance over a three-year measurement period. The Compensation Committee of the Board restructured thismay grant additional cash or equity grant opportunity into two separate opportunities, each with a target award equal to 50 percent of the original equity opportunity. The original equity opportunity, now of upMs. McLean to $175,000, remained unchanged, while the new long-term equity incentive opportunity of 0 percent to 200 percent of the remaining $175,000 is basedincentivize her performance on a three-year performance target.standalone basis or as part of TTEC executive leadership team, from time to time. |
The Compensation Committee of the Board may grant additional cash or equity to Ms. McLean to incentivize her performance on a standalone basis or as part of TTEC executive leadership team, from time to time.
| ● | • | Benefits. Ms. McLean is entitled to participate in all customary benefits. |
| ● | • | Severance. Subject to customary releases, Ms. McLean is entitled to severance in the amount of 18 months of Base Salarybase salary and 12 months benefit continuation, if she is terminated without cause or terminates her employment for good reason.“good reason”. |
| ● | • | Change in Control Provision.Provision. The agreement provides for change in control benefit equal to 2.5x of her Base Salary,base salary, 12 months of continuation of benefits, provided the executiveMs. McLean is terminated without cause during three months prior to and 24 months following such change in control event and acceleration of vesting for all equity grants held at the time of such termination. |
SemachWagers Agreement
TTEC entered into an employment agreement with Mr. Semach in 2021 in connection with his appointment as TTEC Chief Financial Officer.
| ● | •TTEC entered into an employment agreement with Mr. Wagers in February 2024, in connection with his appointment as TTEC Chief Financial Officer effective March 1, 2024. | | ● | Base Salary. Mr. Semach is entitled to receive aWagers’ annual base salary of $400,000is $625,000 amended from time to time at the Company’sCompensation Committee of the Board’s discretion. |
| ● | • | Annual Cash Incentives. Mr. SemachWagers is eligible to participate in the Company’s annual variable cash incentive plan with an opportunity up to $400,000.100% of base salary. The opportunity is tied to the annual targets and goals of the business, as well as Mr. Wagers’ personal performance goals, as set by the TTEC CEO and the Company’s Board of Directors. The Compensation Committee of the Board may adjust Mr. Semach’s annual award, if any, will beWagers’ variable cash incentive upward based on a combinationthe Company’s performance against annual metrics set by the Company’s Board of metrics tied to the overall results of the business and his individual performance.Directors. |
| ● | • | Equity Grants. Mr. SemachWagers is eligible to participate in the Company’s annual equity program with $1.8 million grant with an opportunity of up to $400,000.opportunity. The actual amount of the annual equity grantopportunity to be awarded is discretionary and not guaranteed and is based on TTEC’s performance overall and Mr. Semach’sWagers’ individual performance against targets set by the Company’s Board of Directors annually. The Board of Directors has discretion to modify the structure of this equity grantopportunity. Currently, the equity opportunity provided that the overall benefit is not materially impacted. The Compensation Committee of the Board structured this equity grant opportunity as two separate opportunities, each with a target award equal to 50 percent of the overall equity opportunity: the time-based equity opportunitygrant of up to $200,000,$900,000 vesting over three to four years; and another long-terma performance-based equity incentive opportunitygrant with a $900,000 target and a payout of between 0 percent to 200 percentand 200%, depending on the Company’s performance over a three-year measurement period. |
| ● | One Time Welcome Equity Grant. At the start of his employment as the CFO of the remaining $200,000,Company, Mr. Wagers was granted time-based restricted stock units with a market value of $4.0 million based on a three-year performance target.TTEC stock’s fair market value at the time of the grant. This one-time grant shall vest in five installments, on the anniversaries of the grant. |
The Compensation Committee of the Board may grant additional cash or equity to Mr. Semach to incentivize his performance on a standalone basis or as part of TTEC executive leadership team, from time to time.
| ● | • | Benefits. Mr. SemachWagers is entitled to participate in all customary benefits.wellness benefits offered to TTEC executives. No special perquisites are included in Mr. Wagers’ compensation arrangement. |
| ● | • | Severance. Subject to customary releases, if Mr. SemachWagers is terminated without cause of terminates his employment for “good reason”, he will be entitled to severance in the amount of 1518 months of Base Salarybase salary and 12 months benefit continuation,continuation. | | ● | Change in Control Provision. The agreement provides that if heMr. Wagers is terminated without cause or terminates his employment for good reason. |
| • | Change“good reason” during the period starting three months prior to and 15 months following a change in Control Provision. The agreement provides forcontrol event, Mr. Wagers will receive a change in control benefit equal to 1.5x of his Base Salary,2x of base salary and 12 months of continuation of benefits, providedbenefits; Mr. Wagers will also be entitled to the executive is terminated without cause during three months prior to and 12 months following such change in control event and acceleration of vesting for all equity grants held at the time of such termination.termination, including performance-based equity grants, with value for vesting purposes to be set at target. |
Provisions in our Named Executive Officers’ employment agreements relating to severance, termination and change in control are discussed in greater detail in the section below entitled “Executive Compensation Tables - Potential Payments upon Termination or Change in Control.Control.”
COMPENSATION RISK ASSESSMENT As discussed above under the heading “Board Risk Oversight,” we conduct an annual assessment of our compensation policies and practices for all employees. We review and discuss the results of this assessment with the Compensation Committee.Committee of the Board. Based upon this assessment, review, and discussion, we believe that our compensation policies and practices do not create unreasonable risk to the business.
TAX CONSIDERATIONS Section 409A of the Internal Revenue Code (the “Code”) imposes additional income taxes on executive officers for certain types of deferred compensation that do not comply with Section 409A of the Code. In 2008, we revised several of our compensation plans and agreements with technical changes designed to cause any nonqualifiednon-qualified deferred compensation payable under such plans and agreements to comply with, or be exempt from, Section 409A. We did so because we provide certain executives, including our Named Executive Officers, with the opportunity to contribute up to 75 percent75% of their salaries or cash incentives to a deferred compensation plan. We do not provide deferred compensation to the Named Executive Officers in excess of their individual contributions.
ACCOUNTING CONSIDERATIONS The Compensation Committee of the Board also considers the accounting and cash flow implications of our executive compensation program. In our financial statements, we record salaries and cash incentives as expenses in the amount paid, or to be paid, to the Named Executive Officers. Accounting rules also require us to record equity awards as an expense in our financial statements even though equity awards are not paid as cash to employees. The accounting expense of equity awards to employees is calculated in accordance with the guidance in FASB ASC Topic 718. The Compensation Committee of the Board believes, however, that the advantages of equity compensation programs, as discussed above, outweigh the non-cash compensation expense associated with them.
EXECUTIVE COMPENSATION TABLES
Summary Compensation Table Paid in 2021for 2023 The following table sets forth the compensation for the services in all capacities to us and our subsidiary companies paid for the years ended December 31, 2021, 2020,2023, 2022, and 20192021 to our Named Executive Officers: Name and Principal Position | | Year | | Salary ($) | Bonus ($) 1 | Stock Awards ($) 2 | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) 3 | Change in Pension Value and Nonqualified Deferred Compensation Earnings
($) 4 | All Other Compensation ($) 5 | Total ($) | Kenneth D. Tuchman (Chief Executive Officer) | | 2021 | | 1 | | – | | – | | – | | – | | 567,932 | | 64,202 | | 632,135 | | 2020 | | 1 | | – | | – | | – | | – | | 571,247 | | 57,047 | | 628,295 | | 2019 | | 1 | | – | | – | | – | | – | | 534,289 | | 90,779 | | 625,069 | Richard Sean Erickson (Global Head of Engage) | | 2021 | | 363,462 | | – | | 267,481 | | – | | 259,515 | | – | | 9,097 | | 899,555 | | 2020 | | 99,615 | | 50,000 | | 697,452 | | – | | – | | – | | 119 | | 847,186 | | 2019 | | – | | – | | – | | – | | – | | – | | – | | – | Judi A. Hand (Chief Revenue Officer) | | 2021 | | 400,000 | | – | | 1,270,003 | | – | | 960,000 | | – | | 31,069 | | 2,661,072 | | 2020 | | 400,000 | | – | | 1,376,517 | | – | | 379,530 | | – | | 22,922 | | 2,178,969 | | 2019 | | 400,000 | | – | | – | | – | | 245,230 | | – | | 26,323 | | 671,553 | Margaret B. McLean (General Counsel and Chief Risk Officer) | | 2021 | | 375,000 | | – | | 555,595 | | – | | 601,350 | | – | | 8,274 | | 1,540,219 | | 2020 | | 375,000 | | – | | 716,646 | | – | | 292,500 | | – | | 4,524 | | 1,388,670 | | 2019 | | 375,000 | | – | | – | | – | | 172,500 | | – | | 8,274 | | 555,774 | Regina M. Paolillo (Global Chief Operating Officer) | | 2021 | | 425,000 | | – | | 1,587,546 | | – | | 1,144,500 | | 1,376,152 | | 20,222 | | 4,553,420 | | 2020 | | 425,000 | | – | | 1,707,973 | | – | | 400,383 | | 1,303,383 | | 10,382 | | 3,847,121 | | 2019 | | 425,000 | | – | | – | | – | | 258,806 | | 1,190,754 | | 17,086 | | 1,891,646 | Dustin J. Semach (Chief Financial Officer) | | 2021 | | 380,770 | | – | | 112,491 | | – | | 76,500 | | – | | 4,185 | | 573,946 | | 2020 | | – | | – | | – | | – | | – | | – | | – | | – | | 2019 | | – | | – | | – | | – | | – | | – | | – | | – |
Name and Principal Position | Year | Salary ($) | Bonus ($) 1 | Performance- Based RSU (PRSU) Awards Under VCP ($) | Annual Performance- Based RSU (PRSU) Awards ($) 2 | Restricted Stock Unit Awards ($) 3 | Stock Awards Total ($) | Non-Equity Incentive Plan Compensation ($)4 | Change in Pension Value and Non-qualified Deferred Compensation Earnings ($) 5 | All Other Compensation ($) 6 | Total ($) 7 | Kenneth D. Tuchman (Chief Executive Officer) | 2023 | 1 | – | – | – | – | – | – | – | 100,150 | 100,151 | 2022 | 1 | – | – | – | – | – | – | – | 69,682 | 69,683 | 2021 | 1 | – | – | – | – | – | – | 567,932 8 | 64,202 | 632,135 | Michelle “Shelly” R. Swanback (President, TTEC Holdings) | 2023 | 697,115 | – | – | 3,249,993 | 2,000,001 | 5,249,994 | – | – | 10,314 | 5,957,424 | 2022 | 396,635 | – | 5,537,250 | 499,977 | 4,500,012 | 10,537,239 | – | – | 962 | 10,957,424 | Francois Bourret (Interim Chief Financial Officer) | | | | | | | | | | | | 2023 | 318,961 | 300,000 1 | – | – | 469,985 | 469,985 | 54,000 | – | 10,080 | 1,153,027 | | | | | | | | | | | | Dustin J. Semach (Former Chief Financial Officer) | 2023 | 159,615 | – | – | – | – | – | – | – | 2,677 | 162,293 | 2022 | 400,000 | – | 1,163,132 | 199,966 | 199,972 | 1,563.070 | 194,527 | – | 9,330 | 2,166,97 | 2021 | 380,770 | – | – | – | 112,491 | 112,491 | 76,500 | – | 4,185 | 573,946 | David J. Seybold (Chief Executive Officer, TTEC Digital) | 2023 | 625,000 | – | – | 312,507 | – | 312,507 | – | – | 8,497 | 946,004 | 2022 | 36,058 | – | 2,288,500 | – | 2,999,995 | 5,288,495 | – | – | – | 5,324,552 | Margaret B. McLean (General Counsel and Chief Risk Officer) | 2023 | 416,539 | – | – | 210,013 | 59,984 | 269,997 | – | – | 9,519 | 696,055 | 2022 | 381,923 | – | 797,689 | 291,705 | 229,971 | 1,319,365 | 171,000 | – | 17,460 | 1,889,748 | 2021 | 375,000 | – | – | 291,632 | 263,963 | 555,595 | 601,350 | – | 8,274 | 1,540,219 |
| 1. | 1 | Amounts are discretionary cash bonus payments and sign-on bonus payments outsideIn 2023, the Compensation Committee of the discretionary performance-based cash incentive awards that are not subjectBoard agreed to pre-establishedprovide Mr. Bourret with a one-time retention bonus in connection with his position as Interim CFO, payable in three installments as follows: 25% in October of 2023, 25% in March of 2024 and communicated performance measures.50% in December of 2024. |
| 2. | 2 | Amounts were calculated pursuant to the guidance in FASB ASC Topic 718. For performance-based equity granted but not yet earned under the 2023 long-term incentive plan, we calculated the fair value based on the closing price of our common stock on date of grant multiplied by the number of target shares granted. At maximum achievement of 200%, using the fair value at grant, the award values would be as follows: Ms. Swanback $6,499,986, Mr. Seybold $625,014, and Ms. McLean $420,026. | | 3. | Amounts were calculated pursuant to the guidance in FASB ASC Topic 718. We calculate the fair value for RSUs based on the closing price of our common stock on the date of grant multiplied by the number of shares granted.granted. For performance-based equity granted but not yet earned under the 2021 long-term incentive plan, we calculated theinformation regarding assumptions used to compute grant date fair value basedwith respect to the restricted stock unit awards, see Note 19 to our financial statements in our Annual Report on Form 10-K for the closing price of our common stock on date of grant multiplied byyear ended December 31, 2023. | | 4. | For 2023, the number of target shares granted. |
| 3 | The amountsamount summarized includeincludes payments made in 20212023 for the discretionary 20212022 performance-based cash incentive awards paid in 2021.awards. |
| | | Due to COVID-19, the Company made the decision for performance year 2020 to eliminate mid-year cash incentive payments, typically paid in the third quarter of 2020, and instead pay full-year cash incentives in 2021 once 2020 financials were finalized (specifically described in the section entitled “2020 Performance-Based Cash Incentive Award” under the “Cash Incentives Paid in 2020 and 2021 With Respect to 2020 Performance”). The payments paid in calendar year 2021 were made the first quarter of 2021 based on 2020’s full-year performance (specifically described in the section entitled “2020 Performance-Based Cash Incentive Award” under “Cash Incentives Paid in 2020 and 2021 With Respect to 2020 Performance” and the third quarter of 2021 based on 2021’s mid-year performance (specifically described in the section entitled “2021 Performance-Based Cash Incentive Award” under the “Cash Incentives Paid in 2021 and 2022 With Respect to 2021 Performance”). |
| 45. | Amounts for 2023 are summarized below in the section entitled “Nonqualified“Non-qualified Deferred Compensation Table.” Pursuant to Instruction 3 to Item 402(c)(viii) of Regulation S-K, negative amounts are disclosed in the NonqualifiedNon-qualified Deferred Compensation table and are excluded from the Summary Compensation Table. Under the deferred compensation plan, the Company does not match employee contributions; the amounts summarized solely represent market gains on invested funds. The amount shown | | 6. | Amounts for Mr. Tuchman and Ms. Paolillo have been reduced to reflect the actual market gains associated with our Nonqualified Deferred Compensation Plan; the amounts previously reported in 2020 were overstated and included 10 days of market activity that occurred in 2021. |
| 5 | Amounts2023 are summarized below under the heading “All Other Compensation Table.Compensation.” | | 7. | The Summary Compensation table should be read in conjunction with additional tables and narrative descriptions that follow. The Grants of Plan-Based Awards table, and the accompanying description of the material terms of the RSU awards granted in 2023, provides information regarding the long-term equity incentives awarded to Named Executive Officers in 2023. The Outstanding Equity Awards at Year-End and Option Exercises and Stock Vested tables provide further information on the Named Executive Officers’ potential realizable value and actual value realized with respect to their equity awards. | | 8. | In 2021, the Company voluntarily disclosed earnings under the Non-Qualified Deferred Compensation plan. Under the deferred compensation plan, the Company does not match employee contributions; the amount summarized solely represented market gains on invested funds and were not above-market gains. |
The Summary Compensation Table should be read in conjunction with additional tables and narrative descriptions that follow. The Grants of Plan-Based Awards table, and the accompanying description of the material terms of the RSU awards granted in 2021, provides information regarding the long-term equity incentives awarded to Named Executive Officers in 2021. The Outstanding Equity Awards at Year-End and Option Exercises and Stock Vested tables provide further information on the Named Executive Officers’ potential realizable value and actual value realized with respect to their equity awards.
Non-qualified Deferred Compensation Table Name | | Executive Contributions in Last Fiscal Year ($) 1 | | Registrant Contributions in Last Fiscal Year ($) 2 | | Aggregate Earnings or Losses in Last Fiscal Year ($) 3 | | Aggregate Withdrawals/ Distributions in Last Fiscal Year ($) | | Aggregate Balance at Last Fiscal Year End ($) 4 | Kenneth D. Tuchman | | – | | – | | 567,932 | | – | | 4,100,230 | Richard Sean Erickson | | – | | – | | – | | – | | – | Judi A. Hand | | – | | – | | – | | – | | – | Margaret B. McLean | | – | | – | | – | | – | | – | Regina M. Paolillo | | 754,996 | | 212 | | 1,376,152 | | – | | 8,693,123 | Dustin J. Semach | | – | | – | | – | | – | | – |
Name | Executive Contributions in Last Fiscal Year ($) | Registrant Contributions in Last Fiscal Year ($) | Aggregate Earnings or Losses in Last Fiscal Year ($) | Aggregate Withdrawals/ Distributions in Last Fiscal Year ($) | Aggregate Balance at Last Fiscal Year End ($) 1 | | | | | | | Kenneth D. Tuchman | – | – | 672,575 | – | 4,031,758 2 | Michelle “Shelly” R. Swanback | – | – | – | – | – | Francois Bourret | – | – | – | – | – | Dustin J. Semach | – | – | – | – | – | David J. Seybold | – | – | 15,865 | – | 173,515 | Margaret B. McLean | – | – | – | – | – |
| 11. | Amounts set forth in this column are included in “Salary,” “Bonus” and/or “Non-Equity Incentive Plan” compensation columns of the Summary Compensation Table above for the Named Executive Officers. |
2 | Amount reflected is a contribution made on behalf of the Company due to a refund associated with the employer match that was forfeited in the 401(k) Plan. |
3 | Amounts set forth in this column are included in the “Change in Pension Value and Non-Qualified Deferred Compensation Earnings” column and are included in the Summary Compensation Table above for the Named Executive Officers. |
4 | Amounts set forth in this column were reported as compensation to the Named Executive Officers in the Summary Compensation Table for 2021 and previous years.years. | | 2. | The 12/31/22 balance reported in TTEC’s 2023 proxy was overstated by the amount of aggregate losses during 2022, namely ($741,047). The 2022 year-end balance was $3,359,183. |
All Other Compensation Table The following table describes the perquisites and other compensation received by the Named Executive Officers during 2021:2023: Perquisite | Mr. Tuchman | Mr. Erickson | Ms. Hand | Ms. McLean | Ms. Paolillo | Mr. Semach | Use of Aircraft | – | – | – | – | – | – | Automobile | $33,952 | – | – | – | – | – | Executive Health/Dental/Vision Premiums | $29,062 | – | $21,071 | – | $7,992 | – | Group Term/Executive Life Premiums | $1,188 | $1,188 | $3,998 | $774 | $1,188 | $159 | Company Contribution to Deferred Compensation Plan1 | – | – | – | – | $212 | – | 401(k) Plan Matching Contributions | – | $7,909 | $6,000 | $7,500 | $10,830 | $4,026 | Total | $64,202 | $9,097 | $31,069 | $8,274 | $20,222 | $4,185 |
1 | Amount reflected is a contribution made on behalf of the Company to our deferred compensation plan due to a refund associated with the employer match that was forfeited in the 401(k) Plan. |
Perquisite | Mr. Tuchman | Ms. Swanback | Mr. Bourret | Mr. Semach | Mr. Seybold | Ms. McLean | Use of Aircraft | $37,595 1 | – | – | – | – | – | Automobile | $33,952 | – | – | – | – | – | Executive Health/Dental/Vision Premiums | $27,415 | – | – | – | – | – | Group Term/Executive Life Premiums | $1,188 | $414 | $180 | $62 | $774 | $1,188 | Company Contribution to Deferred Compensation Plan | – | – | – | – | – | – | 401(k) Plan Matching Contributions | – | $9,900 | $9,900 | $2,615 | $7,723 | $8,331 | Total | $100,150 | $10,314 | $10,080 | $2,677 | $8,497 | $9,519 |
| 1. | This represents $24,568 usage value plus a gross up of $13,027 for applicable taxes. |
Grants of Plan-Based Awards Each of the Non-Equity Incentive Plan Awards reported in this “Grants of Plan-Based Awards” table refers to discretionary performance-based cash incentive award payments. The material terms of these incentive awards are described in the section entitled “Compensation Discussion and Analysis.” The following table sets forth information about the discretionary performance-based cash incentive awards or discretionary cash bonuses for the Named Executive Officers in 2023, the equity award opportunity under the 2023 long-term compensation plan and the RSU stock awards to each Named Executive Officer during 2023: Name | Grant Date | Stock Award Description | Estimated Future Payouts Under Non-Equity Incentive Plan Awards 1 | Estimated Future Payouts Under Equity Incentive Plan Awards 2 | All Other Stock Awards: Number of Shares of Stock | Grant Date Fair Value of Stock and Option Awards ($) 4 | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (# Shares) | Target (# Shares) | Maximum (# Shares) | Or Units (#) 3 | | Kenneth D. Tuchman | – | | – | – | – | – | – | – | – | – | Michelle ”Shelly” R. Swanback | – | Cash Incentive | – | 700,000 | -- | – | – | – | – | – | 03/16/2023 | Annual PRSU | -- | -- | -- | 17,166 | 34,331 | 68,662 | -- | 1,249,992 | 03/16/2023 | Promotional PRSU | -- | -- | -- | 27,465 | 54,930 | 109,860 | – | 2,000,001 | 03/16/2023 | Promotional RSU | – | -- | – | – | – | – | 54,930 | 2,000,001 | Francois Bourret | – | Cash Incentive | – | 129,814 | – | – | – | – | – | – | 04/03/2023 | Promotional RSU | – | – | – | – | – | – | 10,870 | 400,016 | 04/14/2023 | Annual RSU | – | – | – | – | – | – | 953 | 34,985 | 04/14/2023 | Retention RSU | – | – | – | – | – | – | 953 | 34,985 | Dustin J. Semach | – | | -- | – | -- | -- | -- | -- | -- | -- | David J. Seybold | -- | Cash Incentive | -- | 625,000 | -- | -- | -- | -- | -- | -- | 03/16/2023 | Annual PRSU | – | – | – | 4,292 | 8,583 | 17,166 | -- | 312,507 | Margaret B. McLean | -- | Cash Incentive | -- | 333,674 | -- | -- | -- | -- | -- | -- | 03/16/2023 | Annual PRSU | -- | -- | -- | 2,884 | 5,768 | 11,536 | -- | 201,013 | 04/14/2023 | Retention RSU | -- | -- | -- | -- | -- | -- | 1,634 | 59,984 |
| 1. | Amounts summarized in this column reflect the target bonus opportunity under our 2023 performance-based cash award plan. Mr. Tuchman elected not to participate in prior year performance-based cash incentive awards, and he again elected not to receive such awards in 2023. However, on December 31, 2023, Mr. Tuchman was still eligible to receive payments for such awards. | | 2. | Under the 2023 long-term incentive plan approved by the Compensation Committee of the Board in 2023, senior executives have an opportunity to earn between 0% to 200% of the target shares covered by the award based on the level of achievement against pre-established performance targets. The amounts shown represent the threshold, target and maximum number of shares that may be earned under the 2023 long-term incentive plan for each senior executive. | | 3. | Amounts set forth in this column represent the number of shares underlying time-in-service-based RSU awards. | | 4. | Amounts set forth in this column represent the grant date fair value as determined pursuant to the guidance in FASB ASC Topic 718. We calculate the fair value for RSUs based on the closing price of our common stock on the date of grant multiplied by the number of shares granted. The grant date value shown for awards subject to performance conditions is based on “target” level achievement and the closing price of our common stock on date of grant. |
Outstanding Equity Awards at Year-End The following table presents information regarding the outstanding equity awards held by each of the Named Executive Officers as of December 31, 2023, including the vesting dates for the portions of these awards that had not vested as of that date. All equity awards listed below were issued from our Equity Incentive Plans. Name | Grant Date | Number of Shares of Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) 1 | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested At Threshold Performance ($) 2 | | | | | | | Kenneth D. Tuchman | - | - | - | - | - | Michelle “Shelly” R. Swanback | 05/02/2022 | 48,760 3 | 1,056,629 | 6,772 14 | 73,375 | 05/02/2022 | - | - | 75,000 13 | 812,625 | 03/16/2023 | - | - | 54,930 15 | 595,167 | 03/16/2023 | 54,930 4 | 1,190,333 | 34,311 15 | 371,976 | Francois Bourret | 07/01/2020 | 674 5 | 14,606 | - | - | 07/01/2021 | 671 6 | 14,541 | - | - | 03/15/2022 | - | - | 2,940 13 | 31,855 | 07/01/2022 | 1,266 7 | 27,434 | - | - | 04/03/2023 | 10,870 8 | 235,553 | - | - | 04/14/2023 | 953 9 | 20,652 | - | - | 04/14/2023 | 953 10 | 20,652 | - | - | Dustin J. Semach | - | - | - | - | - | David J. Seybold | 12/07/2022 | 65,545 11 | 1,420,360 | 50,000 13 | 541,750 | 03/16/2023 | - | - | 8,583 15 | 92,997 | Margaret B. McLean | 03/04/2020 | 612 12 | 13,262 | - | - | 07/01/2020 | 1,752 5 | 37,966 | - | - | 03/03/2021 | - | - | 1,557 16 | 16,870 | 07/01/2021 | 1,288 6 | 27,911 | - | - | 03/04/2022 | - | - | 2,314 14 | 25,072 | 03/15/2022 | - | - | 10,150 13 | 109,975 | 07/01/2022 | 2,530 7 | 54,825 | - | - | 03/16/2023 | - | - | 5,768 15 | 62,496 | 04/14/2023 | 1,634 10 | 35,409 | - | - |
| 1. | The dollar amounts are determined by multiplying (i) the number of share units by (ii) $21.67 which was the closing price of our common stock on December 31,2023, the last trading day of 2023. | | 2. | The dollar amounts are determined by multiplying (i) the number of share units reported by 50% (threshold) by (ii) $21.67 which was the closing price of our common stock on December 31,2023, the last trading day of 2023. | | 3. | The unvested portion of this time-in-service-based RSU award vests in four equal installments beginning on May 2, 2024 and on each anniversary thereafter, subject to continued employment. | | 4. | The unvested portion of this time-in-service-based RSU award vests in five equal installments beginning on March 16, 2024 and on each anniversary thereafter, subject to continued employment . | | 5. | The unvested portion of this time-in-service-based RSU award vests on July 1, 2024, subject to continued employment. | | 6. | The unvested portion of this time-in-service-based RSU award vests in two equal installments beginning on July 1, 2024 and again on the next anniversary, subject to continued employment. | | 7. | The unvested portion of this time-in-service-based RSU award vests in three equal installments beginning July 1, 2024 and on each anniversary, thereafter, subject to continued employment. | | 8. | The unvested portion of this time-in-service-based RSU award vests in four equal installments beginning on March 17, 2024 and on each anniversary thereafter, subject to continued employment. | | 9. | The unvested portion of this time-in-service-based RSU award vests in four equal installments beginning on April 14, 2024 and on each anniversary thereafter, subject to continued employment. | | 10. | The unvested portion of this time-in-service-based RSU award vests on April 14, 2024, subject to continued employment. | | 11. | The unvested portion of this time-in-service-based RSU award vests in four equal installments beginning with 40% vesting on November 28, 2024 and three equal installments vesting on each anniversary thereafter, subject to continued employment. | | 12. | The unvested portion of this time-in-service-based RSU award vests on March 4, 2024, subject to continued employment. | | 13. | The unvested portion of this Value Creation Plan award includes one measurement period at the end of fiscal year 2025. Vesting is subject to (i) achievement of Revenue and Adjusted Operating Income targets and (ii) continued employment of the award holder. Should award holder be employed during 2024 and exit before the end of the measurement period, the award may vest on a pro-rated basis subject to achievement of targets. Based on current targets and outlook, there is a limited probability that the award will vest. | | 14. | In connection with the 2022 long-term incentive plan, the unvested portion of this performance based RSU granted on May 2, 2022 includes one measurement period at the end of fiscal year 2024. Vesting is subject to (i) achievement of Revenue and Adjusted EBITDA and (ii) the continued employment of the award holder. | | 15. | In connection with the 2023 long-term incentive plan, the unvested portion of this performance based RSU granted on March 16, 2023 includes one measurement period at the end of fiscal year 2026. Vesting is subject to (i) achievement of Revenue and Adjusted EBITDA and (ii) the continued employment of the award holder. | | 16. | In connection with the 2021 long-term incentive plan, the unvested portion of this performance based RSU granted on March 3, 2021 includes one measurement period at the end of fiscal year 2023. Vesting was subject to the achievement of Revenue and Adjusted Operating Income; based on achievement of targets, 75% of the award vested on March 3,2024. The shares reported represent the adjustment to 75% of the original target shares and the market value as of December 31, 2023. |
Stock Vested The following table presents information regarding the vesting of RSUs and performance-based RSUs held by Named Executive Officers during 2023. Stock Awards | Name | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) 1 | Kenneth D. Tuchman | – | – | Michelle “Shelly” R. Swanback | 12,191 | 396,695 | Francois Bourret | 1,431 | 48,425 | Dustin J. Semach | – | – | David J. Seybold | – | – | Margaret B. McLean | 8,142 | 310,827 |
| 1. | The dollar amounts reflected above for value realized on stock awards’ vesting are determined by multiplying (i) the number of shares of common stock issued due to RSU vesting by (ii) the per-share price of our common stock as of market close on the date of vesting. |
Potential Payments Upon Termination or Change in Control Our RSU agreements for Named Executive Officers only provide accelerated vesting if Named Executives’ employment with the Company is terminated without cause during three months prior to a change in control event or within 12 or 24 months after such change in control event, depending on the executive. Named Executive Officers are also entitled to certain severance and continuation of benefits if they are terminated without cause during the above-stated change in control termination window. The amount of severance varies among Named Executive Officers and is disclosed as part of Employment Agreement disclosures in this Proxy statement. Termination and Change in Control Table The following table lists the Named Executive Officers and the estimated amounts they would have become entitled to on December 31, 2023: (a) upon termination without cause or resignation for good cause; (b) upon termination for cause or voluntary resignation; (c) upon death; (d) upon disability; and (e) upon a change in control occurring on such date: Name | | Termination Without Cause or Resignation for Good Reason ($) | Termination for Cause or Voluntary Resignation ($) | Death ($) | Disability ($) 1 | Termination in Connection with Change in Control ($) | Kenneth D. Tuchman | Cash | 2 | – | – | 100 | 2 | Equity Acceleration 2 | – | – | – | – | – | Continued Benefits 3 | 145,194 | – | – | – | – | Accidental Death & Dismemberment Insurance (AD&D) | – | – | 200,000 | 200,000 | – | Life Insurance 5 | – | – | 200,000 5 | – | – | Total | 145,196 | – | 400,000 | 200,100 | 2 | | | | | | | | Michelle “Shelly” R. Swanback | Cash | 1,229,200 6 | – | – | 58,333 | 1,579,200 6 | Equity Acceleration 2 | – | – | – | – | 5,546,935 | Continued Benefits 4 | – | – | – | – | – | AD&D | 38 4 | – | 200,000 | 200,000 | 38 4 | Life Insurance 5 | 427 | – | 200,000 5 | – | 427 | Total | 1,229,665 | – | 400,000 | 258,333 | 7,126,600 | | | | | | | | Francois Bourret | Cash | 625,000 7 | – | – | 12,000 | 625,000 7 | Equity Acceleration 2 | -- | – | – | – | 381,219 | Continued Benefits 4 | -- | – | – | – | – | AD&D | 38 | – | 200,000 | 200,000 | 38 | Life Insurance 5 | 427 | – | 200,000 5 | – | 427 | Total | 625,466 | – | 400,000 | 212,000 | 1,006,684 | | | | | | | | David J. Seybold | Cash | 1,097,500 6 | -- | -- | 52,083 | 1,410,000 6 | Equity Acceleration 2 | -- | -- | -- | – | 2,418,979 | Continued Benefits 4 | 35,810 | -- | -- | – | 47,747 | AD&D | 58 4 | -- | 200,000 | 200,000 | 77 4 | Life Insurance 5 | 641 | -- | 200,000 5 | – | 854 | Total | 1,134,009 | -- | 400,000 | 252,083 | 3,877,657 | | | | | | | | Margaret B. McLean | Cash | 630,000 | -- | – | 35,000 | 1,050,000 | Equity Acceleration 2 | -- | – | – | | 554,308 | Continued Benefits 4 | 17,479 | – | – | | 17,149 | AD&D | 38 | – | 200,000 | 200,000 | 38 | Life Insurance 5 | 427 | – | 200,000 5 | – | 427 | Total | 647,944 | -- | 400,000 | 235,000 | 1,621,922 |
| 1. | Represents one month of short-term disability. Under the employment agreements of Ms. Swanback, Mr. Seybold and Ms. McLean they are eligible to receive their full salary for the first 90 days of disability. The amount reflected represents one-month salary continuation. | | 2. | Upon a termination in connection with a change in control, the dollar amounts set forth in this row represent the value of unvested RSUs that would vest upon a termination in connection with a change in control, the value of 2022 long-term incentive plan awards at target, the value of 2023 long-term incentive plan awards at target, and the value of the 2022 VCP awards at 75% of target. The values are calculated using a per share price of $21.67, which is the closing price of our common stock on December 31, 2023 (the last trading day of 2023). | | 3. | Pursuant to his employment agreement, Mr. Tuchman is entitled to receive the value of “continued benefits,” including personal use of the Company aircraft, an automobile allowance, executive health, dental and vision insurance premiums, life insurance premiums, deferred death benefits and 401(k) plan matching contributions, equal to two times the value at time of separation. For purposes of the auto allowance and aircraft, each such benefit will be determined as reported in the summary compensation table of the Company’s proxy statement for the prior year. | | 4. | Under the employment agreements of our NEOS, except for Mr. Seybold, they are eligible to receive 12 months of benefit continuation at the same level of welfare and health benefits in place prior to termination of employment. The dollar amounts set forth represent the cost of benefit coverage in place on December 31, 2023. Mr. Seybold’s agreement provides 18 months of benefits continuation for a termination without cause and 24 months of benefits continuation for a change in control based on the cost of benefit coverage in place on December 31, 2023. | | 5. | Includes $200,000 of basic life insurance provided by the Company. | | 6. | Under the employment agreements for Ms. Swanback and Mr. Seybold, in addition to severance, they are eligible for a pro-rated bonus based on the actual achievement to financial targets under the annual bonus plan. The cash payment reported includes severance, plus bonus they would have been entitled to on December 31, 2023, based on the funding level of the 2023 annual bonus plan. | | 7. | Includes severance under Mr. Bourret’s employment agreement and the remainder of his retention bonus due to be paid in 2024. |
Note: Mr. Semach has been excluded from this table as he exited the Company in April 2023. Mr. Semach did not receive any payments or benefits as a result of his exit. 2023 CEO Pay Ratio | ● | Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, we are required to disclose the median of the annual total compensation of our employees, the annual total compensation of our principal executive officer, Chairman and CEO Kenneth Tuchman, and the ratio of these two amounts. | | ● | To determine the CEO pay ratio, we first identified our median employee. We selected October 1, 2023, as the date upon which we would identify the “median employee,” because it enabled us to make such identification in a reasonable timeframe. In determining the employee population to be used to calculate the compensation of the median employee, we included employees in all countries. TTEC is a global company, with complex operations worldwide with more than half of its employees located outside of United States, the country in which our headquarters office is located. As of October 1, 2023, TTEC’s workforce consisted of approximately 62,660 full-time, part-time, and temporary/seasonal employees. | | ● | We utilized 2023 actual cash compensation (base wages + allowances/premiums + variable incentives) for our consistently applied compensation measure because we believe that this measure reasonably reflects the annual compensation of our employees. We do not grant equity to a large percentage of our employee population, so using actual cash compensation is representative. We included all our full-time, part-time, and temporary / seasonal employees globally, but excluded our CEO. We annualized the compensation for all full-time and part-time employees who did not work for us for the entire fiscal year. Earnings of our employees outside the U.S. were converted to U.S. dollars using the currency exchange rates used for organizational planning purposes which rely on forecasted rates. The forecasted rates are based on historical rate trends, external market data and other factors. We did not make any cost-of- living adjustments. | | ● | After identifying our median employee, based on our consistently applied compensation measure, we calculated annual total compensation for this employee using the same methodology we use for our Named Executive Officers as set forth in the 2023 Summary Compensation Table included in this Proxy Statement. Based on this calculation, our median employee’s annual total compensation for 2023 was $13,789. Our CEO’s annual total compensation for 2023 was $100,151. As a result, the ratio of our CEO’s annual total compensation to that of our median employee’s annual total compensation for 2023 is 7 to 1. While our pay ratio is 7 to 1, it is important to note that the annual base salary for our CEO is $1.00. The remaining portion of Mr. Tuchman’s 2023 compensation relates to the amounts summarized under the “All Other Compensation” column in the 2023 Summary Compensation Table. |
Pay Versus Performance In 2022, the Securities and Exchange Commission (the “SEC”) adopted Pay versus Performance (PvP) rules as required by the Dodd–Frank Wall Street Reform and Consumer Protection Act. These rules require that companies disclose how NEOs’ “Compensation Actually Paid” relates to the disclosures in the Summary Compensation Table and to the financial performance of the company. The following Pay Versus Performance (PvP) Table summarizes the key points demonstrated in the accompanying tables. Pay Versus Performance (PvP) Table The table below shows compensation actually paid (as defined by the SEC in Item 402(v) of Regulation S-K) for our executives and our financial performance for the years shown in the table. For purposes of this discussion, our CEO is also referred to as our principal executive officer or “PEO” and our other Named Executive Officers are referred to as our “Non-PEO NEOs”: | | | | | Value of an Initial $100 Investment Based on 12/31/19 | | Company Selected Measure | Fiscal Year | Summary Compensation Table Total for PEO1,2 | Compensation Actually Paid to PEO1,3 | Average Summary Compensation Table Total For Non-PEO NEOs1,4 | Average Compensation Actually Paid to Non-PEO NEOs1,5 | Total Shareholder Return6 | Peer Group Total Shareholder Return7 | Net Income (millions)8 | Pre-Bonus Adjusted Operating Income (millions)9 | 2023 | $100,151 | $100,151 | $1,782,960 | $138,937 | $61 | $158 | $18.3 | $154.7 | 2022 | $69,683 | $69,683 | $6,423,892 | $1,502,297 | $119 | $125 | $117.3 | $197.8 | 2021 | $632,135 | $632,135 | $2,045,642 | $2,745,100 | $241 | $194 | $158.2 | $251.4 | 2020 | $628,295 | $628,295 | $1,917,864 | $2,325,816 | $192 | $129 | $129.3 | $237.5 |
| 1. | The NEOs included in these columns reflect the following individuals: |
Year | PEO | Non-PEO NEOs | 2023 | Kenneth D. Tuchman | Michelle "Shelly" R. Swanback, Francois Bourret, Dustin J. Semach, David J. Seybold, Margaret B. McLean | 2022 | Kenneth D. Tuchman | Dustin J. Semach, Michelle "Shelly" R. Swanback, Regina M. Paolillo, David J. Seybold | 2021 | Kenneth D. Tuchman | Regina M. Paolillo, Richard S. Erickson, Judi A. Hand, Margaret B. McLean, Dustin J. Semach | 2020 | Kenneth D. Tuchman | Regina M. Paolillo, Martin F. DeGhetto, Richard S. Erickson, Judi A. Hand, Margaret B. McLean |
| 2. | Amounts reflect Summary Compensation Table Total Pay for our NEOs for each corresponding year. | | 3. | Compensation Actually Paid (CAP) has been calculated based on the requirements and methodology set forth in the applicable SEC rules (Item 402(v) of Regulation S-K). Since Mr. Tuchman does not currently receive equity grants, there is no equity adjustments recorded and the dollar amounts reflect the actual amount of compensation earned during the applicable year. | | 4. | The amounts reported under "Average Summary Compensation Table Total" for non-PEO NEOs represent the average of the amounts reported for the Company's Named Executive Officers (NEOs) as a group (excluding any individual serving as PEO for such year) in the 'Total' column of the Summary Compensation Table in each applicable year. | | 5. | The amounts in column "Average Compensation Actually Paid" for non-PEO NEOs represent the average amount of compensation paid to the NEOs as a group (excluding the PEO), as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the NEOs as a group during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the adjustments in the table below were made to the NEOs' total compensation for each year to determine the compensation actually paid. See "Reconciliation of Summary Compensation Table Total to Compensation Actually Paid for Non-PEO NEOs" table below for additional information. | | 6. | Total Shareholder Return (TSR) represents the cumulative return on a fixed investment of $100 in the Company’s common stock, for the period beginning on the last trading day of fiscal year 2019 through the end of the applicable fiscal year, assuming reinvestment of dividends. | | 7. | Peer Group Total Shareholder Return represents the cumulative return on a fixed investment of $100 in the same Customized Peer Group utilized in our annual 10-K Stock Performance Graph (Accenture Plc, Cognizant Technology Solutions Corp, Concentrix Corp, Globant S.A., Teleperformance, Telus International) for the period beginning on the last trading day of fiscal year 2019 through the end of the applicable fiscal year, assuming reinvestment of dividends. | | 8. | The dollar amounts reported represent the net income reflected in the Company’s audited financial statements for the applicable year. | | 9. | We use Pre-Bonus Adjusted Operating Income as a performance measure in our annual cash-based incentive plan. Refer to "Reconciliation of Non-GAAP Income from Operations" table on Page 57 for reconciliations from GAAP figures to Pre-Bonus adjusted operating figures. TTEC presents company performance metrics on a non-GAAP basis to more accurately convey the performance of the business, which adjusts for non-operating items including, but not limited to, asset impairment, restructuring charges, cybersecurity incident-related costs, changes in acquisition contingent considerations, and one-time non-recurring items. |
Reconciliation of Summary Compensation Table Total to Compensation Actually Paid for Non-PEO NEOs Fiscal Year | Summary Compensation Table Total | (Minus): Grant Date Fair Value of Equity Awards Granted in the Fiscal Year | Plus: Fair Value at Fiscal Year End of Outstanding and Unvested Equity Awards Granted in the Fiscal Year | Plus/(Minus): Change in Fair Value of Outstanding and Unvested Equity Awards Granted in Prior Fiscal Years | Plus: Fair Value at Vesting of Equity Awards Granted and Vested in the Fiscal Year | Plus/(Minus): Change in Fair Value as of the Vesting Date of Equity Awards Granted in Prior Fiscal Years that Vested in the Fiscal Year | (Minus): Fair Value as of the Prior Fiscal Year End of Equity Awards Granted in Prior Fiscal Years that Failed to Meet Vesting Conditions in the Fiscal Year | Plus: Value of Dividends or Other Earnings Paid on Equity Awards Not Otherwise Reflected in Total Compensation | Compensation Actually Paid | 2023 | $1,782,960 | ($1,260,497) | $300,520 | ($546,207) | $0 | ($38,247) | ($99,593) | $0 | $138,937 | 2022 | $6,423,892 | ($5,971,533) | $1,427,926 | $38,389 | $48,620 | ($126,588) | ($338,408) | $0 | $1,502,297 | 2021 | $2,045,642 | ($758,623) | $315,295 | $753,592 | $153,446 | $235,747 | $0 | $0 | $2,745,100 | 2020 | $1,917,864 | ($966,385) | $797,796 | $297,612 | $375,662 | $38,641 | ($135,374) | $0 | $2,325,816 |
For purposes of the above adjustments, the fair value of equity awards on the applicable date were determined in accordance with FASB’s ASC Topic 718, using valuation methodologies that are generally consistent with those used to determine the grant-date fair value for accounting purposes. The assumptions used in calculating the fair value of the equity awards did not differ in any material respect from the assumptions used to calculate the grant date fair value of the awards as reported in the Summary Compensation Table, except for the fair value calculations of performance-based equity awards, which reflect the currently known probable outcome of the performance vesting conditions as of each measurement date. Most Important Performance Measures Following is an unranked list of the financial performance measures we consider most important in linking company performance and compensation actually paid to our Named Executive Officers for the most recently completed fiscal year. Further information on our performance measures is described in our Compensation Discussion & Analysis (CD&A) above. | ● | Pre-Bonus Adjusted Operating Income | | ● | Revenue | | ● | Adjusted EBITDA |
Relationship between Compensation Actually Paid and Performance As described in "Compensation Discussion and Analysis" above, the Company uses several performance measures to align executive compensation with Company performance. Not all such measures are presented in the Pay versus Performance table above. As described in greater detail in “Compensation Discussion and Analysis,” TTEC’s executive compensation program reflects a pay-for performance philosophy. In accordance with Item 402(v) of Regulation S-K, we are providing the following graphical descriptions showing certain information presented in the table above. The following chart illustrates the relationship between CAP for our PEO and the average CAP for our Non-PEO NEOs against the Company’s TSR, as well as the relationship between our TSR and the TSR of our peer group: ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14aimg021.jpg)
Relationship between CAP vs. Net Income The following chart illustrates the relationship between CAP for our PEO and the average CAP for our Non-PEO NEOs against the Company’s Net Income: ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14aimg022.jpg)
Relationship between CAP vs. Pre-Bonus Adjusted Operating Income The following chart illustrates the relationship between CAP for our PEO and the average CAP for our Non-PEO NEOs against the Company’s Pre-Bonus Adjusted Operating Income: ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14aimg023.jpg)
| | 12 Months ended December 31, | Reconciliation of Non-GAAP Income from Operations: | | 2023 | | 2022 | 2021 | 2020 | | | | | | | | Income from Operations | | $118,021 | | $168,543 | $217,192 | $204,692 | Restructuring charges, net | | 8,041 | | 5,673 | 3,807 | 3,264 | Impairment losses | | 11,733 | | 13,749 | 11,254 | 5,809 | Cybersecurity incident related impact, net of insurance recovery | | (3,210) | | (3,610) | 13,659 | - | Software accelerated amortization | | - | | 8,509 | - | - | Write-off of acquisition related receivable | | - | | 900 | - | - | Property costs not related to operations | | 1,501 | | - | - | - | Liability related to notifications triggered by labor scheme1 | | 6,000 | | - | - | - | Grant income for pandemic relief | | 40 | | - | (8,142) | - | Change in acquisition related obligation | | 483 | | - | - | - | Bonus expense related to current year | | 12,064 | | 7,406 | 17,908 | 26,147 | Acquisition related income excluded for bonus achievement calculation | | - | | (3,334) | - | (2,428) | Reversal of acquisition-related deferred revenue excluded for bonus achievement | | - | | - | (4,305) | - | Pre-Bonus Adjusted Operating Income | | $154,673 | | $197,836 | $251,373 | $237,484 |
Equity Compensation Plan Information The following table sets forth, as of December 31, 2023, the number of shares of our common stock to be issued upon exercise of outstanding options, RSUs, warrants and rights, the weighted-average exercise price of outstanding options, warrants and rights, and the number of securities available for future issuance under equity-based compensation plans: Plan Category | | Number of Securities to be Issued Upon Exercise of Outstanding Options, RSUs, Warrants and Rights | | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights ($) | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in the Second Column) | Equity compensation plans approved by security holders | | 1,604,2731 | | – | | 1,834,918 | Equity compensation plans not approved by security holders | | – | | – | | – | Total | | 1,604,2731 | | | | 1,834,918 |
| 1. | Reflects 3,647 RSUs outstanding under the 2010 equity incentive plan and 1,600,626 RSUs/PRSUs outstanding under the 2020 equity incentive plan. 1,834,918 shares are available for issuance under the 2020 equity incentive plan. |
Compensation Committee Interlocks and Insider Participation No member of the Compensation Committee of the Board (i) was an officer or employee of the Company, (ii) was formerly an officer of the Company, or (iii) had any relationship requiring disclosure under the SEC’s rules governing disclosure of related person transactions. During the fiscal year ended December 31, 2023, we had no “interlocking” relationships in which (i) an executive officer of the Company served as a member of a compensation committee of another entity, one of whose executive officers served on our Compensation Committee of the Board, (ii) an executive officer of the Company served as a director of another entity, one of whose executive officers served on our Compensation Committee of the Board, or (iii) an executive officer of the Company served as a member of a compensation committee of another entity, one of whose executive officers served as a director of the Company. COMPENSATION COMMITTEE REPORT The Committee evaluates and establishes compensation for TTEC executive officers and oversees the equity-based compensation plans, performance-based cash incentive plans, and other management incentives and perquisite programs. The Committee also considered the impact of the COVID-19 pandemic on the performance of the Company and executive compensation. The Committee reviewed and discussed with the Company’s management the “Compensation Discussion and Analysis.” The following table sets forth information about the discretionary performance-based cash incentive awards or discretionary cash bonuses for the Named Executive Officers in 2021, the equity award opportunity under the 2021 long-term compensation plan and the RSU stock awards to each Named Executive Officer during 2021: | | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards 1 | | Estimated Future Payouts Under Equity Incentive Plan Awards 2 | | All Other Stock Awards: Number of Shares of Stock Or Units (#) 3 | | All Other Option Awards: Number of Securities Underlying Options (#) | | Exercise or Base Price of Option Awards ($/Sh) | | Grant Date Fair Value of Stock and Option Awards ($) 4 | Name | | Grant Date | | Threshold ($) | Target ($) | Maximum ($) | | Threshold ($) | | Target ($) | | Maximum ($) | Kenneth D. Tuchman | | – | | – | – | – | | – | | – | | – | | – | | – | | – | | – | Richard Sean Erickson | | – | | – | 261,288 | – | | – | | – | | – | | – | | – | | – | | – | | | 03/03/2021 | | – | – | – | | 621 | | 1,241 | | 2,482 | | – | | – | | – | | 104,964 | | | 07/01/2021 | | – | – | – | | – | | – | | – | | 1,586 | | – | | – | | 162,517 | Judi A. Hand | | – | | – | 400,000 | – | | – | | – | | – | | – | | – | | – | | – | | | – | | 66,667 | 133,334 | 266,668 | | – | | – | | – | | – | | – | | – | | – | | | 03/03/2021 | | – | – | – | | – | | – | | – | | 3,153 | | – | | – | | 266,681 | | | 03/03/2021 | | – | – | – | | 2,365 | | 4,729 | | 9,458 | | – | | – | | – | | 399,979 | | | 07/01/2021 | | – | – | – | | – | | – | | – | | 5,888 | | – | | – | | 603,343 | Margaret B. McLean | | – | | – | 285,000 | – | | – | | – | | – | | – | | – | | – | | – | | | – | | 29,167 | 58,334 | 116,668 | | – | | – | | – | | – | | – | | – | | – | | | 03/03/2021 | | – | – | – | | – | | – | | – | | 1,379 | | – | | – | | 116,636 | | | 03/03/2021 | | – | – | – | | 1,035 | | 2,069 | | 4,138 | | – | | – | | – | | 174,996 | | | 07/01/2021 | | – | – | – | | – | | – | | – | | 2,576 | | – | | – | | 263,963 | Regina M. Paolillo | | – | | – | 425,000 | – | | – | | – | | – | | – | | – | | – | | – | | | – | | 83,333 | 166,666 | 333,332 | | – | | – | | – | | – | | – | | – | | – | | | 03/03/2021 | | – | – | – | | – | | – | | – | | 3,941 | | – | | – | | 333,330 | | | 03/03/2021 | | – | – | – | | 2,956 | | 5,912 | | 11,824 | | – | | – | | – | | 500,037 | | | 07/01/2021 | | – | – | – | | – | | – | | – | | 7,360 | | – | | – | | 754,179 | Dustin J. Semach | | – | | – | 271,027 | – | | – | | – | | – | | – | | – | | – | | – | | | 03/03/2021 | | – | – | – | | 665 | | 1,330 | | 2,660 | | – | | – | | – | | 112,491 |
| 1 | Amounts summarized in this column reflect the target bonus opportunity under our 2021 performance-based cash award plan and the remaining threshold, target, and maximum award opportunity under our 2019 long-term incentive plan. Under the long-term incentive plan approved by the Compensation Committee in 2019, senior executives have an opportunity to earn an award between 0% to 200% that is settled in equity based on the level of achievement to pre-established performance targets. |
| | Mr. Tuchman has elected not to participate in prior year discretionary performance-based cash incentive awards, and he again elected not to receive such awards in 2021. However, on December 31, 2021, Mr. Tuchman was still eligible to receive payments for such awards. |
| 2 | Under the 2021 long-term incentive plan approved by the Compensation Committee in 2021, senior executives have an opportunity to earn between 0% to 200% of shares granted based on the level of achievement to pre-established performance targets. The amounts shown represent the threshold, target and maximum number of shares that may be earned under the 2021 long-term incentive plan for each senior executive. |
| 3 | Amounts set forth in this column represent the number of shares underlying time-in-service-based RSU awards. |
| 4 | Amounts set forth in this column represent the grant date fair value as determined pursuant to the guidance in FASB ASC Topic 718. We calculate the fair value for RSUs based on the closing price of our common stock on the date of grant multiplied by the number of shares granted. The grant date value shown for awards subject to performance conditions is based on “target” level achievement and the closing price of our common stock on date of grant. |
Outstanding Equity Awards at Year-End
The following table presents information regarding the outstanding equity awards held by each of the Named Executive Officers as of December 31, 2021, including the vesting dates for the portions of these awards that had not vested as of that date. All equity awards listed below were issued from our Equity Incentive Plans.
Name | | Grant Date | | Number of Securities Underlying Unexercised Options Exercisable (#) | | Number of Securities Underlying Unexercised Options Unexercisable (#) | | Option Exercise Price ($) | | Option Expiration Date | | Number of Shares or Units of Stock that Have Not Vested (#) | | Market Value of Shares or Units of Stock That Have Not Vested ($) 1 | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested (#) | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that Have Not Vested (#) 1 | Kenneth D. Tuchman | | – | | – | | – | | – | | – | | – | | – | | – | | – | Richard Sean Erickson | | 09/08/2020 | | – | | – | | – | | – | | 11,080 | 2 | 1,003,294 | | – | | – | | | 09/08/2020 | | – | | – | | – | | – | | – | | – | | 1,800 8 | | 162,990 | | | 03/03/2021 | | – | | – | | – | | – | | – | | – | | 1,241 9 | | 112,373 | | | 07/01/2021 | | – | | – | | – | | – | | 1,586 | 3 | 143,612 | | – | | – | Judi A. Hand | | 06/15/2018 | | – | | – | | – | | – | | 4,264 | 4 | 386,105 | | – | | – | | | 03/06/2020 | | – | | – | | – | | – | | – | | – | | 9,811 8 | | 888,386 | | | 07/01/2020 | | – | | – | | – | | – | | 11,479 | 5 | 1,039,423 | | – | | – | | | 03/03/2021 | | – | | – | | – | | – | | – | | – | | 4,729 9 | | 428,211 | | | 07/01/2021 | | – | | – | | – | | – | | 5,888 | 3 | 533,158 | | – | | – | Margaret B. McLean | | 06/15/2018 | | – | | – | | – | | – | | 1,897 | 4 | 171,773 | | – | | – | | | 03/04/2020 | | – | | – | | – | | – | | 1,835 | 6 | 166,159 | | – | | – | | | 03/06/2020 | | – | | – | | – | | – | | – | | – | | 4,292 8 | | 388,641 | | | 07/01/2020 | | – | | – | | – | | – | | 5,256 | 5 | 475,931 | | – | | – | | | 03/03/2021 | | – | | – | | – | | – | | – | | – | | 2,069 9 | | 187,348 | | | 07/01/2021 | | – | | – | | – | | – | | 2,576 | 3 | 233,257 | | – | | – | Regina M. Paolillo | | 06/15/2018 | | – | | – | | – | | – | | 4,363 | 4 | 395,070 | | – | | – | | | 03/06/2020 | | – | | – | | – | | – | | – | | – | | 12,264 8 | | 1,110,505 | | | 07/01/2020 | | – | | – | | – | | – | | 14,144 | 5 | 1,280,739 | | – | | – | | | 03/03/2021 | | – | | – | | – | | – | | – | | – | | 5,912 9 | | 535,332 | | | 07/01/2021 | | – | | – | | – | | – | | 7,360 | 3 | 666,448 | | – | | – | Dustin J. Semach | | 12/07/2020 | | – | | – | | – | | – | | 13,918 | 7 | 1,260,275 | | – | | – | | | 03/03/2021 | | – | | – | | – | | – | | – | | – | | 1,330 9 | | 120,432 | | | | | | | | | | | | | | | | | | | | | | |
1 | The dollar amounts are determined by multiplying (i) the number of shares or units reported by (ii) $90.55 (the closing price of our common stock on December 31, 2021, the last trading day of 2021). |
2 | The unvested portion of this time-in-service-based RSU award vests in four installments beginning with 40 percent vesting on September 8, 2022 and three equal installments vesting on each anniversary thereafter, subject to continued employment. |
3 | The unvested portion of this time-in-service-based RSU award vests in four equal installments beginning on July 1, 2022 and on each anniversary thereafter, subject to continued employment. |
4 | The unvested portion of this time-in-service-based RSU award is scheduled to vest on June 15, 2022, subject to continued employment. |
5 | The unvested portion of this time-in-service-based RSU award vests in three equal installments beginning on July 1, 2022 and on each anniversary thereafter, subject to continued employment. |
6 | The unvested portion of this time-in-service-based RSU award vests in three equal installments beginning on March 4, 2022, and on each anniversary thereafter, subject to continued employment. |
7 | The unvested portion of this time-in-service-based RSU award vests in four installments beginning with 40 percent vesting on December 7, 2022 and three equal installments vesting on each anniversary thereafter, subject to continued employment. |
8 | In connection with the 2020 long-term incentive plan, the unvested portion of this performance-based RSU granted on March 6, 2020 and September 8, 2020 (issued to Mr. Erickson upon his hire) includes two measurement periods (fiscal years 2021 and 2022). Vesting is subject to (i) achievement of Revenue and Adjusted Operating Income with each performance target weighted 50% and (ii) the continued employment of the award holder. |
9 | In connection with the 2021 long-term incentive plan, the unvested portion of this performance-based RSU granted on March 3, 2021 includes one measurement period (fiscal years 2023). Vesting is subject to (i) achievement of Revenue and Adjusted Operating Income and (ii) the continued employment of the award holder. |
Option Exercises and Stock Vested
The following table presents information regarding the vesting of RSUs and performance-based RSUs held by Named Executive Officers during 2021.
| | Option Awards | Stock Awards | | Name | | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | | Value Realized on Vesting ($) 1 | | Kenneth D. Tuchman | | – | – | – | | – | | Richard Sean Erickson | | – | – | – | | – | | Judi A. Hand | | – | – | 19,833 | | 1,924,387 | | Margaret B. McLean | | – | – | 12,082 | | 1,164,450 | | Regina M. Paolillo | | – | – | 21,609 | | 2,092,115 | | Dustin J. Semach | | – | – | – | | – | | | | | | | | | | |
1 | The dollar amounts reflected above for value realized on stock awards’ vesting are determined by multiplying (i) the number of shares of common stock issued as a result of RSU vesting by (ii) the per-share price of our common stock as of market close on the date of vesting. |
Potential Payments Upon Termination or Change in Control
The RSU agreements that the Named Executive Officers entered into prior and during 2018 have provisions for accelerated vesting, if there is a change in control of TTEC. For agreements entered into after 2018, accelerated vesting occurs only if Named Executives’ employment with the Company is terminated without cause during three months prior to a change in control event and from 12 to 24 months after such change in control event, depending on the executive.
Named Executive Officers are also entitled to certain severance and continuation of benefits, if they are terminated without cause during the above stated change in control termination window. The amount of severance varies among Named Executive Officers and is disclosed as part of Employment Agreement disclosures in this Proxy statement.
Change in Control Defined
A “change in control” is defined as the occurrence of any one of the following events:
| · | Business Combination. Any consolidation, merger, or other similar transaction (a) involving TTEC, if TTEC is not the continuing or surviving corporation, or (b) which contemplates that all or substantially all of the business and/or assets of TTEC will be controlled by another corporation; |
| · | Sale of Substantially All Assets. Any sale, lease, exchange or transfer (in one transaction or several related transactions) of all or substantially all of the assets of TTEC (a “disposition”); provided, however, that the foregoing shall not apply to any disposition to a corporation with respect to which, following such disposition, more than 51 percent of the combined voting power of the then outstanding voting securities of such corporation is beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners of at least 51 percent of the then outstanding common stock and/or other voting securities of TTEC immediately prior to such disposition, in substantially the same proportion as their ownership immediately prior to such disposition; |
| · | Liquidation. Approval by the stockholders of TTEC of any plan or proposal for the liquidation or dissolution of TTEC, unless such plan or proposal is abandoned within 60 days following such approval; |
| · | Acquisition of 51% Interest. Acquisition by any “person” (as such term is used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended), or two or more persons acting in concert, of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended) of 51 percent or more of the outstanding shares of voting stock of TTEC; provided, however, that for purposes of the foregoing, “person” excludes Kenneth D. Tuchman and his affiliates; provided further, that the foregoing shall exclude any such acquisition (a) by any person made directly from TTEC, (b) made by TTEC or any subsidiary, or (c) made by an employee benefit plan (or related trust) sponsored or maintained by TTEC or any subsidiary; or |
| · | Control of the Board. If, during any period of 15 consecutive calendar months commencing at any time on or after the RSU or option grant date, those individuals (the “continuing directors”) who either (a) were directors of TTEC on the first day of each such 15-month period, or (b) subsequently became directors of TTEC and whose actual election or initial nomination for election subsequent to that date was approved by a majority of the continuing directors then on TTEC’s Board of Directors, cease to constitute a majority of the Board of Directors of TTEC. |
The following table lists the Named Executive Officers and the estimated amounts they would have become entitled to on December 31, 2021: (a) upon termination without cause or resignation for good cause; (b) upon termination for cause or voluntary resignation; (c) upon death; (d) upon disability; and (e) upon a change in control occurring on such date:
Change in Control Table
Name | | | | Termination Without Cause or Resignation for Good Cause ($) | | Termination for Cause or Voluntary Resignation ($) | | Death ($) | | Disability ($) 1 | | Termination in Connection with Change in Control ($) | Kenneth D. Tuchman | | Cash | | 2 | | – | | – | | 3,000 | | 2 | | | Equity Acceleration 2 | | – | | – | | – | | – | | – | | | Continued Benefits 3 | | 128,554 | | – | | – | | – | | 128,554 | | | Accidental Death & Dismemberment Insurance (“AD&D”) | | – | | – | | 200,000 | | 200,000 | | – | | | Life Insurance | | – | | – | | 200,000 5 | | – | | – | | | Total | | 128,556 | | – | | 400,000 | | 203,000 | | 128,556 | | | | | | | | | | | | | | Richard Sean Erickson | | Cash | | 187,500 | | – | | – | | 3,000 | | 187,500 | | Equity Acceleration 2 | | – | | – | | – | | – | | 1,422,269 | | | Continued Benefits | | – | | – | | – | | – | | – | | | AD&D | | – | | – | | 200,000 | | 200,000 | | – | | | Life Insurance | | – | | – | | 200,000 5 | | – | | – | | | Total | | 187,500 | | – | | 400,000 | | 203,000 | | 1,609,769 | | | | | | | | | | | | | | Judi A. Hand | | Cash | | 600,000 | | – | | – | | 33,333 | | 1,000,000 | | | Equity Acceleration 2 | | – | | – | | – | | – | | 3,408,617 | | | Continued Benefits 4 | | 22,654 | | – | | – | | – | | 22,654 | | | AD&D | | 38 4 | | – | | 200,000 | | 200,000 | | 38 4 | | | Life Insurance | | 3,127 4 | | – | | 4,200,000 6 | | – | | 3,127 4 | | | Total | | 625,819 | | – | | 4,400,000 | | 233,333 | | 4,434,436 | | | | | | | | | | | | | | Margaret B. McLean | | Cash | | 562,500 | | – | | – | | 31,250 | | 937,500 | | | Equity Acceleration 2 | | – | | – | | – | | – | | 1,681,442 | | | Continued Benefits 4 | | 13,108 | | – | | – | | – | | 13,108 | | | AD&D | | 38 4 | | – | | 200,000 | | 200,000 | | 38 4 | | | Life Insurance | | 317 4 | | – | | 200,000 5 | | – | | 317 4 | | | Total | | 575,963 | | – | | 400,000 | | 231,250 | | 2,632,405 | | | | | | | | | | | | | | Regina M. Paolillo | | Cash | | 637,500 | | – | | – | | 35,417 | | 1,062,500 | | | Equity Acceleration 2 | | – | | – | | – | | – | | 4,154,760 | | | Continued Benefits 4 | | 9,676 | | – | | – | | – | | 9,676 | | | AD&D | | 38 4 | | – | | 200,000 | | 200,000 | | 38 4 | | | Life Insurance | | 317 4 | | – | | 200,000 5 | | – | | 317 4 | | | Total | | 647,531 | | – | | 400,000 | | 235,417 | | 5,227,291 | | | | | | | | | | | | | | Dustin J. Semach | | Cash | | 500,000 | | – | | – | | 33,333 | | 600,000 | | | Equity Acceleration 2 | | – | | – | | – | | – | | 1,380,706 | | | Continued Benefits 4 | | 16,646 | | – | | – | | – | | 16,646 | | | AD&D | | 38 4 | | – | | 200,000 | | 200,000 | | 38 4 | | | Life Insurance | | 317 4 | | – | | 200,000 5 | | – | | 317 4 | | | Total | | 517,001 | | – | | 400,000 | | 233,333 | | 1,997,707 |
| 1 | Represents one month of short-term disability. Under the employment agreements of Hand, McLean, Paolillo and Semach, they are eligible to receive their full salary for the first 90 days of disability. The amount reflected represents one-month salary for disability. |
| 2 | Upon a termination in connection with a change in control, the dollar amounts set forth in this row represent the number of unvested RSUs that would vest upon a termination in connection with a change in control multiplied by $90.55, the closing price of our common stock on December 31, 2021 (the last trading date of 2021), the target (100%) fair-market value remaining under the total 2019 long-term incentive plan that includes one measurement period (2021), the target (100%) fair-market value for the total 2020 long-term incentive plan that includes two measurement periods (2021 and 2022) and the target (100%) fair-market value for the total 2021 long-term incentive plan that includes one measurement period (2023). |
| 3 | Pursuant to his employment agreement, Mr. Tuchman is entitled to receive the value of “continued benefits,” including personal use of the Company aircraft, an automobile allowance, executive health, dental and vision insurance premiums, life insurance premiums, deferred death benefits and 401(k) plan matching contributions, equal to two times the value at time of separation. For purposes of the auto allowance and aircraft, each such benefit will be determined as reported in the summary compensation table of the Company’s proxy statement for the prior year. |
| 4 | Under the employment agreements of Hand, McLean, Paolillo and Semach, they are eligible to receive 12 months of benefit continuation at the same level of welfare and health benefits in place prior to termination of employment. The dollar amounts set forth represent the cost of benefit coverage in place at December 31, 2021. |
| 5 | Includes $200,000 of basic life insurance provided by the Company. |
| 6 | Includes $200,000 of basic life insurance and a $4 million executive life insurance policy provided by the Company. |
2021 CEO Pay Ratio
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, we are required to disclose the median of the annual total compensation of our employees, the annual total compensation of our principal executive officer, Chairman and CEO Kenneth Tuchman, and the ratio of these two amounts.
For 2021, we used the same median employee that was identified in 2020 since there has been no significant change in our employee population or employee compensation arrangements that we reasonably believe would result in a significant change in the pay ratio disclosure.
For 2020, to determine the CEO pay ratio, we first identified our median employee. We selected October 1, 2020, as the date upon which we would identify the “median employee,” because it enabled us to make such identification in a reasonable timeframe. In determining the employee population to be used to calculate the compensation of the median employee, we included employees in all countries. TTEC is a global company, with complex operations worldwide with more than half of its employees located outside of United States, the country in which our headquarters office is located. As of October 1, 2020, TTEC’s workforce consisted of approximately 54,551 full-time, part-time, and temporary/seasonal employees.
We utilized 2020 actual cash compensation (base wages + allowances/premiums + variable incentives) for our consistently applied compensation measure because we believe that this measure reasonably reflects the annual compensation of our employees. We do not grant equity to a large percentage of our employee population, so using actual cash compensation is representative. We included all of our full-time, part-time, and temporary/seasonal employees globally, but excluded our CEO. We annualized the compensation for all full-time and part-time employees who did not work for us for the entire fiscal year. Earnings of our employees outside the U.S. were converted to U.S. dollars using the currency exchange rates used for organizational planning purposes which rely on forecasted rates. The forecasted rates are based on historical rate trends, external market data and other factors. We did not make any cost-of-living adjustments.
In 2021, we calculated annual total compensation for this employee using the same methodology we use for our Named Executive Officers as set forth in the 2021 Summary Compensation Table included in this Proxy Statement. Based on this calculation, our median employee’s annual total compensation for 2021 was $8,464. Our CEO’s annual total compensation for 2021 was $632,135. As a result, the ratio of our CEO’s annual total compensation for 2021 to that of our median employee’s annual total compensation for 2021 is 75 to 1. While our pay ratio was 75 to 1, it is important to note that the annual base salary for our CEO is $1.00. The majority of Mr. Tuchman’s 2021 compensation is related to market gains in the nonqualified deferred compensation plan.
Equity Compensation Plan Information
The following table sets forth, as of December 31, 2021, the number of shares of our common stock to be issued upon exercise of outstanding options, RSUs, warrants and rights, the weighted-average exercise price of outstanding options, warrants and rights, and the number of securities available for future issuance under equity-based compensation plans:
Plan Category | | Number of Securities to be Issued Upon Exercise of Outstanding Options, RSUs, Warrants and Rights | | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights ($) | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in the Second Column) | Equity compensation plans approved by security holders | | 885,612 1 | | – | | 3,168,003 | Equity compensation plans not approved by security holders | | – | | – | | – | Total | | 885,612 1 | | | | 3,168,003 |
1 | Reflects 694,179 RSUs/PRSUs outstanding under the 2020 equity incentive plan and 191,433 RSUs/PRSUs outstanding under the 2010 equity incentive plan. 3,168,003 shares are available for issuance under the 2020 equity incentive plan. |
COMPENSATION COMMITTEE REPORT
We evaluate and establish compensation for TTEC executive officers and oversee the equity-based compensation plans, performance-based cash incentive plans, and other management incentives and perquisite programs. We also considered the impact of the COVID-19 pandemic on the performance of the Company and executive compensation.
The Committee reviewed and discussed with the Company’s management the entitled “Compensation Discussion and Analysis” (“CD&A”)(CD&A) materials presented in this Proxy Statement. Based on this review and discussion, the Committee recommended to the Board that the CD&A be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021,2023, as incorporated by reference from this Proxy Statement.
Compensation Committee | Tracy L. Bahl, | Chair | | Gregory A. Conley | | | Robert N. Frerichs | | Gina L. Loften |
GAAP TO NON-GAAP RECONCILIATION OF PERFORMANCE METRICS The following tables reconcile our operating income and Earnings Per Share (EPS) from the GAAP results to the Non-GAAP comparisons for years ended December 31, 2023 and 2022. | | 12 Months ended December 31, | Reconciliation of Non-GAAP Income from Operations: | | 2023 | | 2022 | | | | | | Income from Operations | | $118,021 | | $168,543 | Restructuring charges, net | | 8,041 | | 5,673 | Impairment losses | | 11,733 | | 13,749 | Cybersecurity incident related impact, net of insurance recovery | | (3,210) | | (3,610) | Software accelerated amortization | | - | | 8,509 | Write-off of acquisition related receivable | | - | | 900 | Property costs not related to operations | | 1,501 | | - | Liability related to notifications triggered by labor scheme1 | | 6,000 | | - | Grant income for pandemic relief | | 40 | | - | Change in acquisition related obligation | | 483 | | - | Equity-based compensation expenses | | 22,071 | | 17,571 | Amortization of purchased intangibles | | 35,759 | | 37,169 | | | | | | Non-GAAP Income from Operations | | $200,439 | | $248,504 | Non-GAAP Income from Operations Margin | | 8.1% | | 10.2% | | | | | | | | 12 Months ended December 31, | Reconciliation of Non-GAAP EPS: | | 2023 | | 2022 | | | | | | Net Income | | $18,264 | | $117,333 | Add: Asset impairment and restructuring charges | | 19,774 | | 19,422 | Add: Equity-based compensation expenses | | 22,071 | | 17,571 | Add: Amortization of purchased intangibles | | 35,759 | | 37,169 | Add: Cybersecurity incident related impact, net of insurance recovery | | (3,210) | | (3,610) | Add: Software accelerated amortization | | - | | 8,509 | Add: Write-off of acquisition related receivable | | - | | 900 | Add: Property costs not related to operations | | 1,501 | | - | Add: Liability related to notifications triggered by labor scheme | | 6,000 | | - | Add: Grant income for pandemic relief | | 40 | | - | Add: Change in acquisition related obligation | | 483 | | - | Add: Changes in acquisition contingent consideration | | 7,480 | | 1,798 | Add: Changes in escrow balance related to acquisition | | 625 | | - | Add: Loss on dissolution of subsidiary | | 301 | | - | Add: Foreign exchange loss / (gain), net | | 1,950 | | (6,514) | Less: Changes in valuation allowance, return to provision adjustments and other, and tax effects of items separately disclosed above | | (7,859) | | (22,872) | | | | | | Non-GAAP Net Income | | $103,179 | | $169,706 | Diluted shares outstanding | | 47,419 | | 47,335 | Non-GAAP EPS | | $2.18 | | $3.59 |
| 1. | For further information, please see discussion in the Risk Factors section of the 2023 Form 10-K filed on February 29, 2024. |
PROPOSALS TO BE VOTED ON AT THE ANNUAL MEETING PROPOSAL 1: Election of DirectorsNO. 1: ELECTION OF DIRECTORS We are seeking your support to elect eight Board member candidates who we have nominated for the 2022-20232024-2025 Board cycle. We believe that these candidates have qualifications and experience appropriate for a public technology and business process outsourcing company with a global operational footprint. The Board believes that the nominees have the experience and perspective to guide the Company as we continue our transformation from a customer care business process outsourcing company to a global integrated customer engagement technology and digital solutions service provider. The candidates also have the experience necessary to support TTEC as we compete in global markets, innovate, and adjust to rapidly changing technologies and client demands. Each member of our Board is elected for a term of one year. Our Board, on the recommendation of the Nominating and Governance Committee of the Board, is recommending to stockholders that the following candidates be elected to the Board at the 20222024 Annual Meeting. The candidates are current TTEC directors and each of the eight director-nominees has confirmed his or her willingness to serve. Director | | | Age | | Director Since | | Independent | | Qualifications | Kenneth D. Tuchman | | | 62 | | 1994 | | | | • Business Transformation Experience • Capital Markets or M&A Experience • ESG Experience • Global Experience • Industry Experience • Operator or CEO Experience • Public Company CEO or Board Experience • Risk Management Experience • Service Industry Experience • Technology Sector Experience • TTEC Founder | Steven J. Anenen | | | 69 | | 2016 | | ü | | • Business Transformation Experience • Capital Markets or M&A Experience • Global Experience • Industry Experience • Operator or CEO Experience • Public Company CEO or Board Experience • Risk Management Experience • Service Industry Experience | Tracy L. Bahl | | | 60 | | 2013 | | ü | | • Business Transformation Experience • Capital Markets or M&A Experience • Industry Experience • Operator or CEO Experience • Public Company Audit Experience • Public Company CEO or Board Experience • Risk Management Experience • Service Industry Experience | Gregory A. Conley | | | 67 | | 2012 | | ü | | • Business Transformation Experience • Capital Markets or M&A Experience • Global Experience • Industry Experience • Operator or CEO Experience • Public Company Audit Experience • Public Company CEO or Board Experience • Risk Management Experience • Service Industry Experience • Technology Sector Experience | Robert N. Frerichs | | | 70 | | 2012 | | ü | | • Business Transformation Experience • Capital Markets or M&A Experience • Global Experience • Industry Experience • Operator or CEO Experience • Public Company Audit Experience • Public Company CEO or Board Experience • Public Sector • Risk Management Experience • Service Industry Experience • Technology Sector Experience |
Marc L. Holtzman | | | 62 | | 2014 | | ü | | • Business Transformation Experience • Capital Markets or M&A Experience • ESG Experience • Global Experience • Industry Experience • Operator or CEO Experience • Public Company CEO or Board Experience • Public Company Audit Experience • Risk Management Experience • Service Industry Experience | Gina L. Loften | | | 56 | | 2021 | | ü | | • Business Transformation Experience • Diversity • Capital Markets or M&A Experience • ESG Experience • Global Experience • Industry Experience • Public Sector • Public Company CEO or Board Experience • Risk Management Experience • Service Industry Experience • Technology Sector Experience | Ekta Singh-Bushell | | | 50 | | 2017 | | ü | | • Business Transformation Experience • Diversity • ESG Experience • Global Experience • Public Company Audit Experience • Public Company CEO or Board Experience • Public Sector • Risk Management Experience • Service Industry Experience • Technology Sector Experience |
Director | Age | Director Since | Independent | Qualifications | Kenneth D. Tuchman | 64 | 1994 | | ● Business Transformation Experience ● Capital Markets or M&A Experience ● Global Experience ● Industry Experience ● Operator or CEO Experience ● Public Company CEO and Board Experience ● Risk Management Experience ● Service Industry Experience ● Technology Sector Experience ● TTEC Founder | Steven J. Anenen | 71 | 2016 | ✓ | ● Business Transformation Experience ● Capital Markets or M&A Experience ● Global Experience ● Industry Experience ● Operator or CEO Experience ● Public Company CEO and Board Experience ● Risk Management Experience ● Service Industry Experience | Tracy L. Bahl | 62 | 2013 | ✓ | ● Business Transformation Experience ● Capital Markets or M&A Experience ● Industry Experience ● Operator or CEO Experience ● Public Company Audit Experience ● Public Company Board Experience ● Risk Management Experience ● Service Industry Experience | Gregory A. Conley | 69 | 2012 | ✓ | ● Business Transformation Experience ● Capital Markets or M&A Experience ● Global Experience ● Industry Experience ● Operator or CEO Experience ● Public Company Audit Experience ● Public Company Board Experience ● Risk Management Experience ● Service Industry Experience ● Technology Sector Experience | Robert N. Frerichs | 72 | 2012 | ✓ | ● Business Transformation Experience ● Capital Markets or M&A Experience ● Global Experience ● Industry Experience ● Operator or CEO Experience ● Public Company Audit Experience ● Public Company Board Experience ● Public Sector Experience ● Risk Management Experience ● Service Industry Experience ● Technology Sector Experience |
Marc L. Holtzman | 64 | 2014 | ✓ | ● Business Transformation Experience ● Capital Markets or M&A Experience ● ESG Experience ● Global Experience ● Industry Experience ● Operator or CEO Experience ● Public Company Board Experience ● Public Company Audit Experience ● Public Sector Experience ● Risk Management Experience ● Service Industry Experience | Gina L. Loften | 58 | 2021 | ✓ | ● Business Transformation Experience ● Capital Markets or M&A Experience ● ESG Experience ● Global Experience ● Industry Experience ● Public Sector Experience ● Public Board Experience ● Risk Management Experience ● Service Industry Experience ● Technology Sector Experience | Ekta Singh-Bushell | 52 | 2017 | ✓ | ● Business Transformation Experience ● ESG Experience ● Global Experience ● Public Company Audit Experience ● Public Company Board Experience ● Public Sector Experience ● Risk Management Experience ● Service Industry Experience ● Technology Sector Experience |
Limits on Director Service on Other Public Company Boards TTEC has a highly effective and engaged Board, and we believe that our directors' service on other companies’ boards enables them to contribute valuable knowledge and perspective to TTEC’s Board activities. Nonetheless, the Board is sensitive to the external obligations of its directors and the potential for overboard to compromise their ability to effectively serve the Company. Our Corporate Governance Guidelines limit each director's service on other boards of public companies to 1-4, depending on their circumstances. Directors whose main job is to sit on boards are limited to four (4) public company board memberships, other than the TTEC Board, and to two (2) audit committee memberships; while those who are employed by a number that permits them, givenpublic company may only be on the TTEC Board in addition to the board of their individual circumstances, to responsibly perform all director duties and, in all events, this service may not exceed four other boards.employer. Further, the ability of each director to devote sufficient time and attention to director duties is expressly considered as part of the annual Board evaluation process, which aims to evaluate the effectiveness and engagement of TTEC’s directors. While the Board considers its directors' outside directorships during this evaluation process, the Board recognizes that this is one of many outside obligations which could potentially impair a director's capacity to dedicate sufficient time and focus to their service on the TTEC Board. As such, the Board evaluates many factors when assessing the effectiveness and active involvement of each director. Such other factors include: | ● | The director's attendance at Board and committee meetings. |
| ● | The director's participation and level of engagement during these meetings. |
| ● | The role played by the director on the Board, as well as on the other boards, including committee membership and chairmanship. |
| ● | The experience and expertise of the director, including both relevant industry experience and service on other public company boards, which enable the director to serve on multiple boards effectively. |
Director Term, Availability, and Ability to Serve We schedule our Board and committee meetings up to athree full yearyears in advance to ensure directors’ availability and maximum participation. Directors serveare elected for a one-year terms;term only and, accordingly, there is an opportunity to evaluate annually each director's ability to serve. If any of the nominees become unable or unwilling to serve before the Annual Stockholder Meeting, shares represented by valid proxies will be voted FOR the election of such other person as our Board may nominate, or the number of directors that constitutes the full Board may be reduced to eliminate the vacancy. Those elected to the TTEC Board at the 20222024 Annual Meeting of Stockholders are expected to hold office until the next Annual Meeting when their successors are duly elected and qualified.
Nominations of Directors While our Board and its Nominating and Governance Committee have not set specific minimum qualifications for director qualifications, they believe that it is important that TTEC directors, as a group, have the following attributes: | ● | Exceptional business savvy and leadership experience; |
| ● | Exceptional business judgment proven in prior roles; |
| ● | Public company board or operational experience; |
| ● | Diversity of perspectives; |
| ● | Global/international experience; |
| ● | Industry and technical experience relevant to TTEC’s business and aligned with its growth strategy; |
| ● | Risk management experience; |
| ● | Technology, digital, artificial intelligence, and machine learning experience; |
| ● | Knowledge of our client verticals; |
| ● | Objective, independent, and pragmatic approach to business decisions; |
| ● | Willingness to devote time and attention to TTEC’s affairs and its stockholders’ interests; and |
| ● | Appreciation of the role of the corporation in society and commitment to sustainable business strategy and social responsibility. |
As part of the nomination process, the Nominating and Governance Committee of the Board carefully considers strategic objectives of the Company and evaluates them against the Board composition and skill set of each director. The Nominating and Governance Committee of the Board considers potential candidates for membership on the Board of Directors throughout the year based on the recommendations brought forward by members of the Board, members of management, professional executive search firms, and stockholders. When evaluating candidates for recommendation to stand for election to the Board, the Nominating and Governance Committee of the Board considers each potential nominee’s skills, experience in areas of current significance to the Company, diversity, independence, the Board’s skills and dynamic as a group, and the candidate’s ability to devote adequate time to the Board’s duties. Candidates selected by the Nominating and Governance Committee of the Board are recommended to our Board for consideration and the Board recommends the candidates as a nominated slate to stockholders. The Nominating and Governance Committee of the Board will consider stockholder recommendations for Board candidates if the names and qualifications of such candidates are submitted in writing to our Corporate Secretary in accordance with our Amended and Restated Bylaws, applicable rules and regulations of the SEC and NASDAQ Stock Market and the notice provisions for stockholder proposals discussed in the section entitled “Stockholder Submission of Nominations and Proposals”.Bylaws. The Nominating and Governance Committee of the Board considers properly submitted stockholders’ nominees in the same manner as it evaluates other candidates.
2024 Director Nominees ![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp13img001.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp011img001.jpg) | Kenneth D. Tuchman Age: 6264 Director since 1994 TTEC Board Committees: ·
●Executive (Chair) Directorships: ·
●Tuchman Family Foundation ·Wapiti Oil & Gas II, LLC
·Aurea Medical, LLC
·●Denver Center for the Performing Arts
Mr. Tuchman has more than 3540 years of experience in the business process outsourcing industry, driving innovation growth and profitability in all economic cycles. As the founder and the controlling stockholder of TTEC, Mr. Tuchman is an essential member of our Board of Directors. Mr. Tuchman founded TTEC’s predecessor company in 1982 and has served as the Chairman of the Board since 1994. Mr. Tuchman served as TTEC Chief Executive Officer from 1994 until 1999 and resumed the position in 2001. | ![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp13img002.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp011img002.jpg) | Steven J. Anenen Age: 6971 Director since 2016 TTEC Board Committees: ·
●Audit ●Nominating and Governance ·●Executive
Past Directorships: ·
●CDK Global (NASDAQ:CDK) ·●DealerSocket
Mr. Anenen’s extensive experience as a senior executive at a global public technology company, and his chief executive and his automotive industry and technology experience bring relevant and necessary skills experience, and perspective to our Board. In 2014, Mr. Anenen led the spin-off of the Automatic Data Processing (NASDAQ:ADP) Dealer Services Group to create CDK Global (NASDAQ:CDK); and served as its CEO between 2014 and his retirement in 2016. Prior to the CDK spin-off, Mr. Anenen spent almost 40 years with ADP, serving as the president of ADP Dealer Services, a leading provider of technology solutions to the automotive industry, between 2004 and 2014. During his tenure with ADP, Mr. Anenen oversaw the global expansion of the business into more than 100 countries, grew the dealer services business to over $2 billion in revenue, and led the transition to digital through the transformational acquisitions. |
![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp13img003.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp011img003.jpg) | Tracy L. Bahl Age: 6062 Director since 2013 TTEC Board Committees: ·
●Compensation (Chair) ·Nominating and Governance●Executive
Directorships: ·andros*
·●andros*
●Glooko, Inc. Past Directorships: ·MedExpress
·●MedExpress
●Gustavus Adolphus College ●Emdeon Mr. Bahl’s extensive experience in the healthcare industry and his public company and private equity experience bring relevant and necessary skills, experience, and perspective to our Board. Since 2020, Mr. Bahl serves as an operating partner for the healthcare group at Welsh, Carson, Anderson & Stowe, a private equity firm specializing in healthcare and technology investments (WCAS); and as a managing partner for Valtruis, and member of the board of directors for Wayspring Health, Oncology Care Partners, and CricketInterWell Health, WCAS'Valtruis’ portfolio companies. He also currently serves on the board of Glooko, a leading diabetes connected care company. Previously, Mr. Bahl served as the president and CEO of OneOncology, a General Atlantic portfolio company that provides administrative, operational, and scientific support to oncology practices throughout the U.S. Between 2013 and 2018, Mr. Bahl served as executive vice president, health plans for CVS Health. From 2007 to 2013, he served as a special advisor to General Atlantic, supporting various of its portfolio companies in leadership roles. Prior to 2007, Mr. Bahl held various senior executive positions as part of UnitedHealth Group and at CIGNA Healthcare. | ![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp13img004.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp011img004.jpg) | Gregory A. Conley Age: 6769 Director since 2012 TTEC Board Committees: ·
●Audit (Chair) ·●Compensation
●Security & Technology Directorships: ·
●CSG International (NASDAQ:CSGS) ·●Travelport Worldwide Ltd.
Past Directorships: ·HaulHound.com
·●HaulHound.com
●Odyssey Group, SA ·●Verio, Inc.
·●Tanning Technology Corporation (NASDAQ:TANN)
Mr. Conley’s extensive public company experience as board member and chief executive officer and as a director of several technology companies, his leadership in technology innovation, and his legal experience bring relevant and necessary skills, experience, and perspective to our Board. Between 2012 and 2014, Mr. Conley served as the CEO of Aha! Software, LLC, a predictive analytics and cloud computing company. Between 2009 and 2011, Mr. Conley served as the CEO of Odyssey Group, SA, a European-based technology services and software company, and oversaw the sale of the company to Temenos Group AG. Between 2004 and 2005, Mr. Conley was the president and CEO of Verio, Inc., a leading global provider of hosting and network services and a subsidiary of Nippon Telephone & Telegraph. From 2001 to 2003, Mr. Conley was the president and CEO of Tanning Technology Corporation, a NASDAQ listed information technology solutions provider, sold to Platinum Equity in 2003. Prior to 2001, Mr. Conley was a senior executive responsible for e-markets, travel, and transportation at International Business Machines (NYSE:IBM) and an attorney at Covington & Burling LLP. |
![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp13img005.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp011img005.jpg) | Robert N. Frerichs Age: 7072 Director since 2012 TTEC Committees: ·
●Nominating and Governance (Chair) ·●Audit
·●Compensation
Directorships: ·
●Wedgewood Enterprises Corporation Past Directorships: ·
●Accenture (NYSE:ACN) ·●Merkle, Inc.
·●Avanade (a JV between Accenture and Microsoft)
·●Cyandia, Inc.
Mr. Frerichs’ extensive global business experience, his public company and consulting industry experience, and his financial credentials bring relevant and necessary skills, experience, and perspective to our Board. Mr. Frerichs spent 36 years with Accenture (NYSE:ACN) in various leadership roles including group chief executive for North America, chief risk officer, and chief operating officer of the communication and high-tech operating group, and chairman of the capital committee; culminating his career as the International Chairman of Accenture, Inc. Between 2012 and 2013, Mr. Frerichs was the chairman of the Aricent Group, a global innovation and technology services company. Mr. Frerichs is a Certified Public Accountant. |
![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp13img006.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp011img006.jpg) | Marc L. Holtzman Age: 6264 Director since 2014 TTEC Committees: ●Nominating and Governance Directorships: ·
●Rwanda Capital Market Authority ●Victoria Falls International Financial Center Past Directorships: ●Bank of Kigali ●CBZ Holdings Ltd. ●Astana Financial Services Authority ·CBZ Holdings Ltd.●KazKommertsBank
·Bank of Kigali●FTI Consulting (NYSE:FCN)
·●Duddell Street Acquisition Corp. (NASDAQ:DSAC)
Past Directorships:
·KazKommertsBank
·FTI Consulting (NYSE:FCN)
Mr. Holtzman’s extensive international experience along with his financial, investment banking, and public company board experience bring relevant and necessary skills, experience, and perspective to our Board. Mr. Holtzman served as the chairman of Meridian Capital HK, a Hong Kong private equity firm from 2012 until 2014, and as the executive vice chairman of Barclays Capital from 2008 and 2012. Between 2003 and 2005, Mr. Holtzman was president of the University of Denver. He also served in the cabinet of Colorado Governor Bill Owens as Secretary of Technology between 1999 and 2003 2003. |
![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp13img007.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp011img007.jpg) | Gina L. Loften Age: 5658 Director since 2021 TTEC Committees: ●Compensation ●Security and Technology Directorships: ·
●Teachers Insurance & Annuity Association of America (TIAA) ·●Thoughtworks Holding, Inc. (NASDAQ:TWKS)
·●Modernizing Medicine, Inc.
·●Foursquare Labs Inc.
●InterWell Health Past Directorships: ·
●Rise Against Hunger ·●George Mason University research foundation.
Ms. Loften’s extensive experience in technology, cyber security,cybersecurity, public sector, business transformation credentials, and diversity bring relevant and necessary skills, experience, and perspective to our Board. Ms. Loften most recently served as chief technology officer for Microsoft USA (NASDAQ:MSFT), the position from which she retired in 2021. Prior to Microsoft, since 2004, Ms. Loften served in roles of growing responsibility with IBM (NYSE:IBM), including global consulting leader in cloud application innovation for IBM Global Business Services, chief innovation officer for IBM Research, and global public sector leader for IBM Watson Group. In considering Ms. Loften’s nomination to the Board for 2022, the Board’s Nominating and Governance Committee evaluated all of her board commitments and determined that they, in the aggregate, do not interfere with her commitments to TTEC. Moreover, the Committee determined that the knowledge and experience that Ms. Loften attains from these additional commitments provide an important dimension to TTEC Board, especially in the technology, human capital, and healthcare disciplines which are directly relevant to TTEC’s business.
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![](https://capedge.com/proxy/DEF 14A/0001104659-22-044677/tm223367d1_def14asp13img008.jpg) ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp011img008.jpg) | Ekta Singh-Bushell Age: 5052 Director since 2017 TTEC Board Committees: · Audit
· Nominating and Governance
Directorships:●Security and Technology (Chair)
· Chargepoint●Audit
●Nominating & Governance Directorships: ●ChargePoint Holdings, Inc. (NYSE:CHPT) ·●Huron Consulting Group (NASDAQ:HURN)
· Net 1 UEPS●Lesaka Technologies, Inc. (NASDAQ:LASK fka UEPS)
· Datatec Limited (JSE:DTC)
·●Women’s Health Access Matters (a non-profit Board)
Past Directorships: ·
●Designer Brands, Inc. (NYSE:DBI – retiring effective May 2022)DBI) ●Datatec Limited (JSE:DTC) Ms. Singh-Bushell’s experience in finance, audit, technology, and cyber security,cybersecurity, as well as her international experience and ESG credentials bring relevant and necessary skills, experience, and perspective to our Board. She also advises startups and private companies in the B2B, data, SaaS, and technology services domains. From 2016 to 2017, Ms. Singh-Bushell served as deputy to the first vice president, chief operating officer executive office, at the Federal Reserve Bank of New York. Prior to 2016, Ms. Singh-Bushell spent more thanclose to 20 years at Ernst & Young, serving in various leadership roles including global IT Effectiveness leader, US innovation & digital strategy leader; and chief Informationinformation security officer. Ms. Singh-Bushell is a Certified Public Accountant and holds advanced international certifications in governance, information systems security, audit, and controls; and is an FSA (fundamentals of sustainability account) credential holder. In considering Ms. Singh-Bushell’s nomination to the Board for 2022, the Board’s Nominating and Governance Committee evaluated all of Ms. Singh-Bushell’s board commitments and determined that they, in the aggregate, do not interfere with her commitments to TTEC. Moreover, the Committee determined that the knowledge and experience that Ms. Singh-Bushell attains from these additional commitments provide an important dimension to TTEC Board, especially in the healthcare, financial services, and retail areas which are all directly relevant to TTEC’s business.
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Board Diversity Matrix | Board Size: | Total Number of Directors | 8 | Gender: | | Female | Male | Non-Binary | Did not Disclose Gender | Directors | 2 | 6 | - | - | Number of Directors who identify in Any of the Categories Below: | African American or Black | 1 | - | - | - | Alaskan Native or Native American | - | - | - | - | Asian (other than South Asian) | - | - | - | - | South Asian | 1 | - | - | - | Hispanic or Latinx | - | - | - | - | Native Hawaiian or Pacific Islander | - | - | - | - | White | - | 6 | - | - | Two or More Races or Ethnicities | - | - | - | - | LGBTQ+ (none have self-identified) | - | Persons with Disabilities (none have self-identified) | |
Board Diversity Matrix Board Diversity Matrix | | Board Size: | | Total Number of Directors | 8 | | Gender: | | | Female | Male | Non-Binary | Did not Disclose Gender | | Directors | 2 | 6 | - | - | | Number of Directors who identify in Any of the Categories Below: | | African American or Black | 1 | - | - | - | | Alaskan Native or Native American | - | - | - | - | | Asian (other than South Asian) | - | - | - | - | | South Asian | 1 | - | - | - | | Hispanic or Latinx | - | - | - | - | | Native Hawaiian or Pacific Islander | - | - | - | - | | White | - | 6 | - | - | | Two or More Races or Ethnicities | - | - | - | - | | LGBTQ+ (none have self-identified) | - | | Persons with Disabilities (none have self-identified) | | | | | | Total Number of Directors: 8 | | | | | | |
Required Vote The eight director nominees receiving the highest number of affirmative votes of the outstanding shares of common stock present or represented by proxy and voting at the Annual Meeting will be elected as directors to serve until the next annual meeting of stockholders and until their successors are duly elected and qualified. Recommendation of the Board Our Board recommends that you vote “FOR” all of the nominees for election to our Board.
PROPOSAL 2: Ratification of the Appointment of Independent Registered Public Accounting Firm
PROPOSAL NO. 2: RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM PricewaterhouseCoopers LLP (PwC) served as TTEC’s independent registered public accounting firm in 2021.2023. The Audit Committee of the Board determined that the current audit team, supported by PwC’s partners experienced with TTEC business in key countries where TTEC has material operations, and other PwC subject matter experts, have the appropriate level of professional expertise to oversee the completion of the TTEC annual independent audit. Although the Audit Committee of the Board has the sole authority to appoint the independent auditor, the Audit Committee of the Board continues its long-standing practice of recommending that the Board ask the stockholders to ratify the appointment of the independent auditor. In accordance with its charter, the Audit Committee of ourthe Board has selected PricewaterhouseCoopers LLP to serve as our independent registered public accounting firm for 20222024 and recommends to the stockholders that they ratify this appointment. If the appointment is not ratified by our stockholders, the Audit Committee of the Board may consider whether it should appoint another independent registered public accounting firm. Representatives of PricewaterhouseCoopers LLP are expected to attend the Annual Meeting, where they will have the opportunity to make a statement if desired and be available to respond to stockholders’ questions. Fees Paid to Accountants
PricewaterhouseCoopers LLP has served as our independent registered public accounting firm since May of 2007. The following table shows the fees for the audit and other services provided by PricewaterhouseCoopers LLP for the years ended December 31, 20212023 and 20202022 (amounts in thousands). | | 2021 | 2020 | Audit fees | | $ 4,145 | $ 3,883 | Audit-related fees | | $ - | $ - | Tax fees | | $ - | $ 159 | All other fees | | $ 135 | $ 117 | Total | | $ 4,280 | $ 4,159 |
| | 2023 | 2022 | Audit fees | | $4,856 | $4,546 | Audit-related fees | | $ - | $ - | Tax fees | | $ - | $ - | All other fees | | $ 1 | $ 69 | Total | | $ 4,857 | $ 4,615 |
Audit Fees This category includes the audit of our annual financial statements; review of financial statements included in our quarterly reports on Form 10-Q; the audit of management’s assessment of the effectiveness of our internal controlscontrol over financial reporting, as well as the audit of the effectiveness of our internal control over financial reporting included in our 20212023 Annual Report on Form 10-K and as required by Section 404 of the Sarbanes-Oxley Act of 2002; and services that are normally provided by the independent registered public accounting firm in connection with statutory and regulatory filings or engagements for current and prior years. This category also includes advice on accounting matters that arose during, or as a result of, the audit or the review of interim financial statements, statutory audits required by non-U.S. jurisdictions, and the preparation of an annual “management letter” on internal control matters. Audit-Related Fees This category consists of assurance and related services provided by the independent registered public accounting firm that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under “Audit Fees.” Audit-related fees included accounting consultations and other attestation procedures. Tax Fees This category consists of professional services rendered by the independent registered public accounting firm, primarily in connection with our tax planning and compliance activities, including the preparation of tax returns in certain overseas jurisdictions and technical tax advice related to the preparation of tax returns. All Other Fees This category consists of professional services related to human capital and expatriate services and other nonrecurring miscellaneous services. The Audit Committee of the Board has considered whether the independent registered public accounting firm’s provision of non-audit services is compatible with their independence and determined that it is compatible. All of the services provided by PricewaterhouseCoopers LLP were approved by the Audit Committee of the Board pursuant to its policy on pre-approval of audit and permissible non-audit services.
Policy on Audit Committee of the Board Pre-Approval of Audit and Non-Audit Services All audit and non-audit services provided by PricewaterhouseCoopers LLP to us must be permissible under Section 10A of the Securities Exchange Act of 1934, as amended, and must be pre-approved in advance by the Audit Committee.Committee of the Board. The Audit Committee of the Board has delegated to the Chair of the Audit Committee of the Board the authority to pre-approve non-audit service projects with a total cost of up to $200,000 per fiscal year. However, if pre-approval is obtained from the Audit Committee of the Board Chair, the service may be performed but must be ratified by the Audit Committee of the Board at the next scheduled meeting. In accordance with this policy, the Audit Committee of the Board pre-approved all services performed and to be performed by PricewaterhouseCoopers LLP. Required Vote Ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 20222024 requires the affirmative vote of a majority of the outstanding shares of common stock present in person or represented by proxy at the meeting and entitled to vote on the proposal. Unless marked to the contrary, proxies received will be voted “FOR” ratification of the appointment of PricewaterhouseCoopers LLP. Recommendation of the Board and the Audit Committee
Our Board and the Audit Committee of the Board recommend that you vote “FOR” Proposal No. 2. PROPOSAL NO. 3: APPROVAL OF AN AMENDMENT TO THE TTEC 2020 EQUITY INCENTIVE PLAN We are asking you to approve an amendment to the TTEC Holdings, Inc. 2020 Equity Incentive Plan (the “2020 Plan” or the “Plan”) to increase the number of shares available for issuance under the 2020 Plan by 4,500,000 shares and to allow certain shares that are withheld for taxes to be added back to the number of shares available for issuance under the 2020 Plan. The amendment to the 2020 Plan was approved by the Board on February 21, 2024, subject to stockholder approval at the 2024 Annual Meeting. The remaining provisions of the 2020 Plan are not affected by the amendment. A copy of the Amendment to the TTEC 2020 Equity Incentive Plan is provided as Appendix A to this Proxy Statement. Reasons for Adopting an Amendment to the 2020 Plan The 2020 Plan is the only compensation plan under which we grant equity-based awards to our employees, contractors, and outside directors. The 2020 Plan was originally adopted and approved by our stockholders in 2020. Although the Company sought the adoption of the Plan with an expectation that it would remain in effect as a main vehicle for equity incentivization for at least five to 10 years, it asked the stockholders to reserve only a limited number of shares that it did not expect to be sufficient for the entire life of the Plan. At this time, the Company expects that the remaining shares reserved for issuance of awards under the 2020 Plan will soon be exhausted. The Compensation Committee of the Board and the Board believe that the Company must continue to offer a competitive equity incentive program to successfully attract, retain, and motivate the best employees, directors, and consultants, without whose services we cannot execute on our business goals or deliver value to our stockholders. The proposed amendment to the 2020 Plan increases the share reserve by 4,500,000 shares and allows certain shares withheld for taxes to be added back to the share reserve, thereby enabling us to continue to offer a competitive equity incentive program for the foreseeable future. In the event the stockholders fail to approve the amendment to the 2020 Plan, our ability to grant incentive equity compensation will be severely constrained, thereby making it more difficult for us to attract, motivate, and retain the highly qualified talent that is essential to the operation of our business. Shares Available for Issuance As noted above, the 2020 Plan is the only compensation plan under which we grant equity-based awards to our employees, contractors and outside directors1. If the amendment to the 2020 Plan is approved by the Company’s stockholders, we will have the following shares available for issuance pursuant to equity-based awards (all share counts determined as of March 31, 2024): | | Shares available for issuance under the 2020 Equity Incentive Plan prior to Amendment | 1,503,401 | Shares increase proposed by the Amendment to the 2020 Equity Incentive Plan | 4,500,000 | Total shares available for new awards upon approval of the Amendment to the 2020 Plan | 6,003,401 | | | |
| 1. | TTEC employees, contractors, and outside directors still hold certain equity that was granted to them pursuant to the TTEC Holdings, Inc. 2010 Equity Incentive Plan but no new equity is granted under that Plan. |
Outstanding Awards under Existing Plans As of March 31, 2024, there were 1,904,674 total outstanding shares of the Company’s common stock. As of March 31, 2024, there were no options outstanding under the Company’s equity compensation plans, and there were 1,471,975 RSUs and 432,699 PRSUs (calculated at target) outstanding under the Company’s equity compensation plans. Other than the foregoing, no other awards were outstanding as of March 31, 2024 under the Company’s equity compensation plans. Description of the 2020 Plan The following summary of material terms of the 2020 Plan, as amended, does not purport to be complete and is subject to and qualified in its entirety by the actual terms of the 2020 Plan. A conformed copy of the 2020 Plan incorporating the amendment is provided as Appendix B to this Proxy Statement.
Purpose of the 2020 Plan The purpose of the 2020 Plan is to promote the success of the Company and the interests of its stockholders by providing an additional means for the Company to attract, motivate, retain, and reward directors, officers, employees, and other eligible persons (including certain consultants and advisors). The Board or one or more committees of the Board consisting of directors appointed by the Board will administer the 2020 Plan. The Board intends to delegate general administrative authority for the 2020 Plan to the Compensation Committee of the Board, which is comprised of directors who qualify as independent under the rules promulgated by the SEC and NASDAQ. Except where prohibited by applicable law, a Committee of the Board may delegate some or all of its authority with respect to the 2020 Plan to another committee of directors or to one or more officers of the Company. For purposes of Rule 16b-3 of the Exchange Act, the rules of the NASDAQ and for grants to non-employee directors, the 2020 Plan must be administered by a committee consisting solely of two or more independent directors. The appropriate acting body, be it the Board, a committee within its delegated authority, or an officer within his or her delegated authority, is referred to in this proposal as the Administrator. The Administrator has broad authority under the 2020 Plan with respect to award grants including, without limitation, the authority: | ● | To select participants and determine the type(s) of award(s) that they are to receive; |
| ● | To determine the number of shares that are to be subject to awards and the terms and conditions of awards, including the price (if any) to be paid for the shares or the award; |
| ● | To cancel, modify, or waive the Company’s rights with respect to, or modify, discontinue, suspend, or terminate any or all outstanding awards, subject to any required consents, and subject to the repricing prohibition described below; |
| ● | To accelerate or extend the vesting or exercisability or extend the term of any or all outstanding awards subject to any required consents; |
| ● | Subject to the other provisions of the 2020 Plan, to make certain adjustments to outstanding awards and authorize the conversion, succession, or substitution of awards; and |
| ● | To allow the purchase price of awards or shares of the Company’s common stock to be paid in the form of cash, check, or electronic funds transfer, by the delivery of already-owned shares of the Company’s common stock or by a reduction of the number of shares deliverable pursuant to the awards, by services rendered by the recipient of the awards, by notice of third party payment or by cashless exercise, on such terms as the Administrator may authorize, or any other form permitted by law. |
Eligibility Persons eligible to receive awards under the 2020 Plan include officers and employees of the Company or any of its subsidiaries, non-employee directors of the Company, and certain individual consultants who render bona fide services to the Company or any of its subsidiaries (other than services in connection with the offering or sale of securities or as a market maker or promoter of securities of the Company). As of March 31, 2024, there were approximately 943 employees, including officers of the Company and its subsidiaries, and seven non-employee directors of the Company who would potentially be eligible to receive awards under the 2020 Plan. Authorized Shares If the amendment to the 2020 Plan is approved by stockholders, the number of shares of Company common stock authorized for issuance pursuant to awards under the 2020 Plan is equal to 6,003,401 shares of Company common stock. The 2020 Plan generally provides that shares issued in connection with awards that are granted by or become obligations of the Company through the assumption of awards (or in substitution for awards) in connection with an acquisition of another company will not count against the shares available for issuance under the 2020 Plan, except as may be required by the Administrator or applicable law or stock exchange rules. Shares that are subject to or underlie awards that expire or for any reason are canceled or terminated, are forfeited, fail to vest, or for any other reason are not paid or delivered under the 2020 Plan are available for reissuance under the 2020 Plan. The 2020 Plan prohibits share recycling with respect to options and stock appreciation rights. Accordingly, shares tendered or withheld to satisfy the exercise price of options or tax withholding obligations with respect to options or SARs, and shares covering the portion of exercised stock-settled SARs (regardless of the number of shares actually delivered), count against the share limit. Shares that are withheld to cover taxes on other types of awards are added back to the share reserve and are available for reissuance under the 2020 Plan. Awards Under the 2020 Plan Because awards under the 2020 Plan are granted in the discretion of the Board or a committee of the Board and depend on a number of factors, the type, number, recipients, and other terms of future awards cannot be determined at this time. No Repricing In no event will any adjustment be made to a stock option or stock appreciation right award under the 2020 Plan (by amendment, cancellation and regrant, exchange for other awards or cash or other means) that would constitute a repricing of the per share exercise or base price of the award, unless such adjustment is approved by the stockholders of the Company. Adjustment made in accordance with the 2020 Plan to reflect a stock split or similar event are not deemed to be a repricing. Minimum Vesting Schedule The 2020 Plan requires a minimum one-year cliff vesting schedule for equity award types under the 2020 Plan. This minimum vesting schedule will apply to at least 95% of the shares authorized for grant under the 2020 Plan. Dividends and Dividend Equivalents Accrued dividends or dividend equivalent amounts shall not be paid unless and until the awards to which they relate become vested. Types of Awards The 2020 Plan authorizes stock options, SARs, restricted stock, RSUs, PSUs and other forms of awards that may be granted or denominated in or otherwise determined by reference to the Company’s common stock, as well as cash awards. The 2020 Plan provides flexibility to offer competitive incentives and to tailor benefits to specific needs and circumstances. Awards may, in certain cases, be paid or settled in cash. Stock Options A stock option is a right to purchase shares of the Company’s common stock at a future date at a specified price per share (the “exercise price”). The per share exercise price of an option generally may not be less than the fair market value of a share of the Company’s common stock on the date of grant. On March 28, 2024, the last sale price of the Company’s common stock as reported on NASDAQ was $10.37 per share. The maximum term of an option is 10 years from the date of grant. An option may be either an incentive stock option or a nonqualified stock option. Incentive stock options are taxed differently than nonqualified stock options and are subject to more restrictive terms under the Internal Revenue Code of 1986, as amended (the “Code”) and the 2020 Plan. Incentive stock options may be granted only to employees of the Company or a subsidiary. Stock Appreciation Rights A stock appreciation right is the right to receive payment of an amount equal to the excess of the fair market value of shares of the Company’s common stock on the date of exercise of the stock appreciation right over the base price of the stock appreciation right. The base price is established by the Administrator at the time of grant of the stock appreciation right and may not be less than the fair market value of a share of the Company’s common stock on the date of grant. Stock appreciation rights may be granted in connection with other awards or independently. The maximum term of a stock appreciation right is 10 years from the date of grant. Restricted Stock Shares of restricted stock are shares of the Company’s common stock that are subject to forfeiture and to certain restrictions on sale, pledge, or other transfer by the recipient during a particular period of employment or service or until certain performance vesting conditions are satisfied. Subject to the restrictions provided in the applicable award agreement and the 2020 Plan, a participant receiving restricted stock may have all of the rights of a stockholder as to such shares, including the right to vote and the right to receive dividends; provided, however, that dividends on unvested shares shall be accrued and shall be paid only if the restricted stock to which they relate become vested. Restricted Stock Units A restricted stock unit represents the right to receive one share of the Company’s common stock on a specific future vesting or payment date. Subject to the restrictions provided in the applicable award agreement and the 2020 Plan, a participant receiving RSUs has no rights as a stockholder with respect to the RSUs until the shares of common stock are issued to the participant. RSUs may be granted with dividend equivalent rights that are payable only if the underlying RSUs vest. RSUs may be settled in cash if so provided in the applicable award agreement.
Performance Stock Units A performance stock unit (PSU) is a performance-based award that entitles the recipient to receive shares of the Company’s common stock based on attainment of one or more performance goals. Each PSU shall designate a target number of shares payable under the award, with the actual number of shares earned (if any) based on a formula set forth in the award agreement related to the attainment of one or more performance goals. Subject to the restrictions provided in the applicable award agreement and the 2020 Plan, a participant receiving PSUs has no rights as a stockholder until the shares of common stock are issued to the participant. PSUs may be granted with dividend equivalent rights that are payable only if the underlying PSUs are earned. PSUs may be settled in cash if so provided in the applicable award agreement. Cash Awards The Administrator, in its sole discretion, may grant cash awards, including, without limitation, discretionary awards, awards based on objective or subjective performance criteria, and awards subject to other vesting criteria. Other Awards The other types of awards that may be granted under the 2020 Plan include, without limitation, stock bonuses, and similar rights to purchase or acquire shares of the Company’s common stock, and similar securities with a value derived from the value of, or related to, the Company’s common stock or returns thereon. Change In Control Unless otherwise provided in an applicable award agreement, upon a change in control (as defined in the 2020 Plan), the Administrator shall have discretion to take whatever actions it deems necessary or appropriate, including but not limited to the following actions: (1) provide for full or partial accelerated vesting of any award or portion thereof, either immediately prior to the change in control or on such terms and conditions following the change in control (such as a termination without cause) as the Administrator determines in its sole and absolute discretion (including vesting of performance-based awards at 100% of target); (2) provide for the assumption of such awards (or portions thereof) or the substitution of such awards (or portions thereof) with similar awards of the surviving or acquiring Company; (3) provide for the cash-out and cancellation of any award (or portion thereof); and (4) take any other actions as the Administrator deems necessary or advisable in connection with such change in control transaction. If the surviving or acquiring company does not assume the outstanding awards (or portions thereof) or substitute similar stock awards for those outstanding under the 2020 Plan as of the change in control, then the vesting and exercisability (if applicable) of all awards (or portions thereof) will be accelerated in full immediately prior to such change in control, and such outstanding awards (or portions thereof) will terminate and/or be payable upon the occurrence of the change in control. The Administrator may take different actions with respect to different participants under the 2020 Plan, different awards under the 2020 Plan, and different portions of awards granted under the 2020 Plan. Transferability of Awards Awards under the 2020 Plan generally are not transferable by the recipient other than by will or the laws of descent and distribution, or pursuant to domestic relations orders. Awards with exercise features are generally exercisable during the recipient’s lifetime only by the recipient. Any amounts payable or shares issuable pursuant to an award generally will be paid only to the recipient or the recipient’s beneficiary or representative. The Administrator has discretion, however, to establish written conditions and procedures for the transfer of awards to other persons or entities, as long as such transfers comply with applicable federal and state securities laws and provided that any such transfers are not for consideration. Adjustments As is customary in plans of this nature, the share limits and the number and kind of shares available under the 2020 Plan and any outstanding awards, as well as the exercise or purchase prices of awards, are subject to adjustment in the event of certain reorganizations, mergers, combinations, recapitalizations, stock splits, stock dividends, or other similar events that change the number or kind of shares outstanding, and extraordinary dividends or distributions of property to the stockholders. No Limit on Other Authority The 2020 Plan does not limit the authority of the Board or any committee of the Board to grant awards or authorize any other compensation, with or without reference to the Company’s common stock, under any other plan or authority. Restrictive Covenants and Recoupment (Clawback) Policy By accepting awards and as a condition to the exercise of awards and the enjoyment of any benefits of the 2020 Plan, participants agree to be bound by any incentive recoupment (clawback) policy adopted by the Company from time to time. Participants may also be subject to restrictive covenants if so required by the Administrator in any award agreement. Termination of, or Changes to, the 2020 Plan The Administrator may amend or terminate the 2020 Plan at any time and in any manner. Stockholder approval for an amendment will be required only to the extent then required by applicable law or any applicable stock exchange rules, or as required to preserve the intended tax consequences of the 2020 Plan. For example, stockholder approval is required for any proposed amendment to increase the maximum number of shares that may be delivered with respect to awards granted under the 2020 Plan. Adjustments as a result of stock splits or similar events will not, however, be considered amendments requiring stockholder approval. Unless terminated earlier by the Board, the authority to grant new awards under the 2020 Plan will terminate on February 27, 2030 (10 years after the date on which the 2020 Plan was originally approved by the Board). Outstanding awards will generally continue following the expiration or termination of the 2020 Plan. Generally speaking, outstanding awards may be amended by the Administrator (except for a repricing), but the consent of the award holder is required if the amendment (or any plan amendment) materially and adversely affects the award holder. Certain Federal Tax Consequences The following summary of the federal income tax consequences of awards under the 2020 Plan is based upon federal income tax laws in effect on the date of this proxy statement. This summary does not purport to be complete, and does not discuss state, local or non-U.S. tax consequences. The tax consequences of individual awards may vary depending upon the particular circumstances applicable to any individual participant. Nonqualified Stock Options The grant of a nonqualified stock option under the 2020 Plan will not result in any federal income tax consequences to the participant or to the Company. Upon exercise of a nonqualified stock option, the participant will recognize ordinary compensation income equal to the excess of the fair market value of the shares of common stock at the time of exercise over the option exercise price. If the participant is an employee, this income is subject to withholding for federal income and employment tax purposes. The Company is entitled to an income tax deduction in the amount of the income recognized by the participant, subject to possible limitations imposed by the Code, including Section 162(m) thereof. Any gain or loss on the participant’s subsequent disposition of the shares will be treated as long-term or short-term capital gain or loss, depending on the sales proceeds received and whether the shares are held for more than one year following exercise. The Company does not receive a tax deduction for any subsequent capital gain. Incentive Stock Options The grant of an incentive stock option (or “ISO”) under the 2020 Plan will not result in any federal income tax consequences to the participant or to the Company. A participant recognizes no federal taxable income upon exercising an ISO (subject to the alternative minimum tax rules discussed below), and the Company receives no deduction at the time of exercise. In the event of a disposition of stock acquired upon exercise of an ISO, the tax consequences depend upon how long the participant has held the shares. If the participant does not dispose of the shares within two years after the ISO was granted, nor within one year after the ISO was exercised, the participant will recognize a long-term capital gain (or loss) equal to the difference between the sale price of the shares and the exercise price. The Company is not entitled to any deduction under these circumstances. If the participant fails to satisfy either of the foregoing holding periods (referred to as a “disqualifying disposition”), he or she will recognize ordinary compensation income in the year of the disposition. The amount of ordinary compensation income generally is the lesser of (i) the difference between the amount realized on the disposition and the exercise price or (ii) the difference between the fair market value of the stock at the time of exercise and the exercise price. Such amount is not subject to withholding for federal income and employment tax purposes, even if the participant is an employee of the Company. Any gain in excess of the amount taxed as ordinary income will generally be treated as a short-term capital gain. The Company, in the year of the disqualifying disposition, is entitled to a deduction equal to the amount of ordinary compensation income recognized by the participant, subject to possible limitations imposed by the Code, including Section 162(m) thereof. The “spread” under an ISO (i.e., the difference between the fair market value of the shares at exercise and the exercise price) is classified as an item of adjustment in the year of exercise for purposes of the alternative minimum tax. If a participant’s alternative minimum tax liability exceeds such participant’s regular income tax liability, the participant will owe the alternative minimum tax liability.
Restricted Stock Restricted stock is generally taxable to the participant as ordinary compensation income on the date that the restrictions lapse (i.e. the date that the stock vests), in an amount equal to the excess of the fair market value of the shares on such date over the amount paid for such stock (if any). If the participant is an employee, this income is subject to withholding for federal income and employment tax purposes. The Company is entitled to an income tax deduction in the amount of the ordinary income recognized by the participant, subject to possible limitations imposed by the Code, including Section 162(m) thereof. Any gain or loss on the participant’s subsequent disposition of the shares will be treated as long-term or short-term capital gain or loss depending on the sales price and how long the stock has been held since the restrictions lapsed. The Company does not receive a tax deduction for any subsequent gain. Participants receiving restricted stock awards may make an election under Section 83(b) of the Code (a “Section 83(b) Election”) to recognize as ordinary compensation income in the year that such restricted stock is granted in an amount equal to the excess of the fair market value on the date of the issuance of the stock over the amount paid for such stock. If the participant is an employee, this income is subject to withholding for federal income and employment tax purposes. If such an election is made, the recipient recognizes no further amounts of compensation income upon the lapse of any restrictions and any gain or loss on subsequent disposition will be long-term or short-term capital gain or loss to the recipient. However, if the stock is later forfeited, the participant will not be able to recover the tax previously paid pursuant to the Section 83(b) Election. The Section 83(b) Election must be made within 30 days from the time the restricted stock is issued. The Company is entitled to a deduction equal to the amount of income taken into account as a result of the Section 83(b) Election, subject to possible limitations imposed by the Code, including Section 162(m) thereof. To the extent dividends are paid while the restrictions on the stock are in effect, any such dividends will be taxable to the participant as ordinary income (and will be treated as additional wages for federal income and employment tax withholding purposes, if the recipient is an employee) and will be deductible by the Company (subject to possible limitations imposed by the Code, including Section 162(m) thereof), unless the participant has made a Section 83(b) Election, in which case the dividends will generally be taxed at dividend rates and will not be deductible by the Company. Other Awards Other awards (such as RSUs and PSUs) are generally treated as ordinary compensation income as and when common stock or cash are paid to the participant upon vesting or settlement of such awards. If the participant is an employee, this income is subject to withholding for income and employment tax purposes. The Company is generally entitled to an income tax deduction equal to the amount of ordinary income recognized by the recipient, subject to possible limitations imposed by the Code, including Section 162(m) thereof. Section 162(m) of the Internal Revenue Code Under Code Section 162(m), no deduction is generally allowed in any taxable year of the Company for compensation in excess of $1 million paid to any of the Company’s “covered employees.” A “covered employee” is any individual who has served at any time after December 31, 2016 as the Company’s chief executive officer, chief financial officer, or other executive officer whose compensation has been reported in a Company proxy statement, regardless of whether any such individual is still employed by the Company. Certain compensation issued prior to November 2, 2017 may be excluded from the determination of the $1 million deduction limit based on specialized transition rules set forth in Code Section 162(m) and related guidance. Section 409A of the Internal Revenue Code Section 409A of the Code provides certain requirements for the deferral and payment of deferred compensation arrangements. In the event that any award under the 2020 Plan is deemed to be a deferred compensation arrangement, and if such arrangement does not comply with Section 409A of the Code, the recipient of such award will recognize ordinary income once such award is vested, as opposed to at the time or times set forth above. In addition, the amount taxable will be subject to an additional 20% federal income tax along with other potential taxes and penalties. It is intended, although not guaranteed, that all awards issued under the 2020 Plan will either be exempt from or compliant with the requirements of Section 409A of the Code. Interested Parties Because approval of the amendment to the 2020 Plan will increase the number of shares available for issuance to the directors and executive officers of the Company, each of those persons has an interest in and may benefit from the approval of the amendment to the 2020 Plan. Required Vote Approval of the amendment to the 2020 Plan will require the affirmative vote of a majority of the shares present or represented at the Annual Meeting. Abstentions will be counted as votes against this matter, and broker non-votes will have no effect on the vote on this matter. Recommendation of the Board Our Board recommends that you vote “FOR” Proposal No. 3. ADDITIONAL INFORMATION Stockholder Submission of Nominations and Proposals In order for a proposal of a stockholder to be included in the Proxy Statement and form(s) of proxy relating to our 20232025 Annual Meeting of Stockholders, the proposal must be in writing and received by our Corporate Secretary at 9197 South Peoria Street, Englewood, Colorado 80112,6312 S. Fiddler’s Green Circle, Suite 100N, Greenwood Village, CO 80111, no later than December 12, 2022.11, 2024. Timely receipt of a stockholder’s proposal will satisfy only one of the various conditions established by the SEC for inclusion in our proxy materials. Stockholders who wish to have their proposals included in our proxy materials must meet the eligibility requirements as provided in the SEC’s Shareholder Proposal Rule (Rule 14a-8), and their proposals must comply with the requirements of the Rule and with our Bylaws to be included in our proxy materials. If a stockholder wishes to present a proposal at the 20232025 Annual Meeting of Stockholders and this proposal is not intended to be included in the related proxy statement and form of proxy, or this stockholder intends to submit a director nomination at the 20232025 Annual Meeting of Stockholders, our Bylaws require that the stockholder notify us in writing on or before February 25, 2023,21, 2025, but no earlier than January 26, 2023.22, 2025. The notice must include the information required by our Bylaws, which may be obtained on our website at ttec.comunder the “Investors” and “Corporate Governance” tabs. If the stockholder does not meet the applicable deadline or comply with the requirements found in the SEC’s Rule 14a-4, we may exercise discretionary voting authority under proxies we solicit to vote, in accordance with our best judgment, on any such proposal. In addition to satisfying the foregoing requirements and those under our Bylaws, to comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than March 23, 2025. Other Business We know of no other matter to be acted upon at the 20222024 Annual Meeting of Stockholders. If any other matters are properly brought before the Annual Meeting, however, the persons named in the accompanying proxy card as proxies for the holders of our common stock will vote thereon in accordance with their best judgment. Annual Report Our 20212023 Annual Report is being delivered to the stockholders together with this Proxy Statement. The Annual Report is not part of the proxy materials, however. Additional copies of our 20212023 Annual Report may be obtained without charge upon request made to TTEC Holdings, Inc., 9197 South Peoria Street, Englewood, Colorado 80112,6312 S. Fiddler’s Green Circle, Suite 100N, Greenwood Village, CO 80111, Attention: Investor Relations. By Order of the Board of Directors
KENNETH D. TUCHMAN Chairman and Chief Executive Officer Englewood, Colorado April 11, 202210, 2024
Appendix A – Amendment to the TTEC 2020 Equity Incentive Plan To be approved by the Company’s Stockholders on May 22, 2024.
TTEC HOLDINGS, INC. 2020 EQUITY INCENTIVE PLAN
Amendment No. 1
THIS AMENDMENT No. 1 to the TTEC Holdings, Inc. 2020 Equity Incentive Plan (the “Plan”) is adopted as of February 21, 2024.
WHEREAS, the Board of Directors (the “Board”) of TTEC Holdings, Inc. (the “Company”) has the general authority to amend the Plan pursuant to Section 10.5 of the Plan;
WHEREAS, the Board desires to amend the Plan (i) to increase the number of shares of Company common stock available for issuance under the Plan from 4,000,000 to 8,500,000 shares, and (ii) to provide that shares withheld to cover taxes due with respect to full value awards shall be added back to the number of shares available for issuance under the Plan, in each case subject to and effective upon approval of this Amendment No. 1 by the Company’s stockholders.
NOW THEREFORE, the Board hereby amends the Plan as follows:
| 1. | Increase in Share Reserve. Subject to and effective upon approval of this Amendment No. 1 by the Company’s stockholders, Section 4.1 of the Plan is hereby deleted in its entirety and replaced with the following: |
“4.1 Shares of Common Stock Subject to the Plan; Share Limit. Subject to the adjustment as provided in Sections 8.1 and 10.9, the maximum number of shares of Common Stock available for issuance under the Plan will be equal to 8,500,000 shares of Common Stock, all of which may be granted, in the sole discretion of the Administrator, as Incentive Stock Options. Common Stock issued under the Plan shall be either authorized but unissued shares of Common Stock or, to the extent permitted, shares of Common Stock that have been reacquired by the Company or any Subsidiary.”
| 2. | Recycling of Shares. Subject to and effective upon approval of this Amendment No. 1 by the Company’s stockholders, Section 4.2 of the Plan is hereby amended by adding the following at the end thereof: |
“Notwithstanding the foregoing, shares that are withheld from an Option or SAR as payment of the exercise price or the withholding taxes relating to the exercise of such Option or SAR, shares that are separately surrendered by the Participant as payment of the exercise price or the withholding taxes relating to the exercise of such Option or SAR, and the total number of shares subject to the exercised portion of a stock-settled SAR (regardless of the actual lesser of number shares delivered to the Participant), shall be deemed to have been issued hereunder and shall reduce the number of shares remaining available for issuance under the Plan. Shares that are withheld as payment of withholding taxes on any type of Award other than an Option or SAR shall be added back to the number of shares available for issuance under the Plan. “
| 3. | Effect on Plan. The Plan shall remain unchanged and in full force and effect except as otherwise set forth in this Amendment No. 1. |
This Amendment No. 1 to the Plan was adopted by action of the Board on date first indicated above.
Appendix B – Conformed Copy of TTEC 2020 Equity Incentive Plan To be approved by the Company’s Stockholders on May 22, 2024. TTEC HOLDINGS, INC. 2020 EQUITY INCENTIVE PLAN Adopted by the Board on February 27, 2020 Approved by the Company’s stockholders on May 13, 2020 Conformed copy incorporating the Amendment adopted by the Board on February 21, 2024 ESTABLISHMENT AND PURPOSE OF PLAN TTEC Holdings, Inc. (NASDAQ:TTEC), a Delaware corporation (the “Company”), hereby establishes the TTEC Holdings, Inc. 2020 Equity Incentive Plan (the “Plan”) as set forth in this document. The purpose of the Plan is to promote the success of the Company and to increase stockholder value by providing an additional means to attract, motivate, retain and reward selected employees, non-employee directors, and other eligible persons through the grant of equity and cash Awards that align the interests of Plan participants with the interests of the Company’s stockholders. DEFINITIONS Defined Terms. As used in the Plan, the following capitalized terms shall have the meanings set forth below: “Administrator” shall mean the Board or one or more Committees appointed by the Board or another Committee (within that Committee’s delegated authority) to administer all or certain aspects of this Plan, as set forth in Section 3 hereof. “Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations of the Exchange Act. “Award” shall mean any award granted under the Plan, including any Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, Performance Stock Unit, cash Award, or Other Stock-Based Award. “Award Agreement” shall mean a written or electronic Award agreement between the Company and a Participant evidencing the grant of an Award under the Plan and containing the terms and conditions of such Award, as determined by the Administrator. “Board” shall mean the board of directors of the Company. “Cause” shall have the meaning ascribed to such term in any written agreement between the Participant and the Company or an Affiliate defining such term and, in the absence of such agreement, such term means, with respect to a Participant, the occurrence of any of the following events, in each case as determined by the Administrator, a Participant’s: (i) commission of a felony or the commission of any crime involving moral turpitude, theft, embezzlement, fraud, misappropriation of funds, breach of fiduciary duty, abuse of trust or the violation of any other law or ethical rule relating to the Company; (ii) material or repeated dishonesty or misrepresentation involving the Company or any Affiliate; (iii) material or repeated misconduct in the performance or non-performance of the Participant’s responsibilities as an employee, officer, director, or consultant; (iv) violation of a material condition of employment; (v) unauthorized use of trade secrets or confidential information (or the Company’s reasonable belief that a Participant has or has attempted to do so); or (vi) aiding a competitor of the Company or any Affiliate. Any determination by the Administrator whether an event constituting Cause has occurred will be final, binding and conclusive. For purposes of this definition, the term “Company” shall be interpreted to include any Subsidiary, Affiliate or parent of the Company, as appropriate. “Change in Control” shall mean and shall be deemed to have occurred upon the occurrence of any one of the largest, global CX (customer experience) technologyfollowing: any consolidation, merger or other similar transaction (i) involving the Company and services innovators for end-to-end, digital CX solutions. The Company delivers leading CX technology and operational CX orchestration at scale through its proprietary cloud-based CXaaS (Customer Experience as a Service) platform. Serving iconic and disruptive brands, TTEC's outcome-based solutions spanAffiliates (“TTEC”), if TTEC is not the entire enterprise, touch every virtual interaction channel, and improve each stepcontinuing or surviving corporation, or (ii) which contemplates that all or substantially all of the customer journey. Leveraging next gen digitalbusiness and/or assets of TTEC will be controlled by another corporation, in each case unless, following such consolidation, merger or other similar transaction, more than fifty one percent (51%) of the combined voting power of the then outstanding voting securities of such corporation is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and cognitive technology,entities who were the Company’s Digital business designs, builds, and operates omnichannel contact center technology, conversational messaging, CRM, automation (AI / ML and RPA), and analytics solutions. The Company’s Engage business delivers digital customer engagement, customer acquisition & growth, content moderation, fraud prevention, and data annotation solutions.beneficial owners of at least fifty one percent (51%) of the then Founded in 1982, the Company’s singular obsession with CX excellence has earned it leading client NPS scores across the globe. The Company's nearly 65,000 employees operate on six continents and bring technology and humanity together to deliver happy customers and differentiated business results.
To learn more about how TTEC is bringing humanity to the customer experience, visit ttec.com.
Corporate Headquarters
9197 South Peoria Street
Englewood, CO 80112-5833
+1.303.397.8100 or 1.800.835.3832
ttec.com
outstanding Common Stock and/or other voting securities of TTEC immediately prior to such consolidation, merger or other similar transaction, in substantially the same proportion as their ownership immediately prior to such consolidation, merger or other similar transaction; any sale, lease, exchange or transfer (in one transaction or series of related transactions) of all or substantially all of the assets of TTEC (a “Disposition”); provided, however, that the foregoing shall not apply to any Disposition to a corporation with respect to which, following such Disposition, more than fifty one percent (51%) of the combined voting power of the then outstanding voting securities of such corporation is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners of at least fifty one percent (51%) of the then outstanding Common Stock and/or other voting securities of TTEC immediately prior to such Disposition, in substantially the same proportion as their ownership immediately prior to such Disposition; approval by the stockholders of TTEC of any plan or proposal for the liquidation or dissolution of TTEC, unless such plan or proposal is abandoned within sixty (60) days following such approval; the acquisition by any “person” (as such term is used in Sections 13(d) and 14(d)(2) of the Exchange), or two (2) or more persons acting in concert, of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of fifty one percent (51%) or more of the outstanding shares of voting stock of TTEC; provided, however, that for purposes of the foregoing, “person” excludes Kenneth D. Tuchman and his affiliates; provided, further that the foregoing shall exclude any such acquisition (A) by any person made directly from TTEC, (B) made by TTEC or any Affiliate, or (C) made by an employee benefit plan (or related trust) sponsored or maintained by TTEC or any Affiliate; or if, during any period of fifteen (15) consecutive calendar months commencing at any time on or after the date of grant of any Award, those individuals (the “Continuing Directors”) who either (A) were directors of TTEC on the first day of each such fifteen (15)-month period, or (B) subsequently became directors of TTEC and whose actual election or initial nomination for election subsequent to that date was approved by a majority of the Continuing Directors then on the board of directors of TTEC, cease to constitute a majority of the board of directors of TTEC. If the occurrence of a Change in Control is a payment event for an Award that is “non-qualified deferred compensation” subject to Section 409A, then a Change in Control will be deemed to have occurred only if the transaction is also a “change in ownership or effective control of” the Company or a “change in the ownership of a substantial portion of the assets of” the Company as determined under Treasury Regulation Section 1.409A-3(i)(5). “Code” shall mean the Internal Revenue Code of 1986, as amended. “Committee” shall mean the Compensation Committee of the Board, or such other Committee of the Board to which administration of the Plan, or a part of the Plan, has been duly delegated as permitted by applicable law and in accordance with the Plan. “Common Stock” shall mean the common stock of the Company, par value $0.01 per share, and such other securities or property as may become the subject of Awards under this Plan pursuant to an adjustment made under Section 8.1. “Company” shall mean TTEC Holdings, Inc., a Delaware corporation. “Disability” shall have the meaning ascribed to such term in any written agreement between the Participant and the Company or an Affiliate defining such term and, in the absence of such agreement, such term means that, in each case as determined by the Administrator: (i) the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) the Participant is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company; provided that, in either case, the Participant’s condition also qualifies as a “disability” for purposes of Section 409A with respect to an Award subject to Section 409A. “Effective Date” shall mean the date on which this Plan is approved by the stockholders of the Company. “Eligible Person” shall mean any person who is either: (a) an officer, whether or not a director, or employee of the Company or one of its Subsidiaries; (b) a non-employee director of the Company or one of its Subsidiaries; or (c) an individual consultant who renders bona fide services (other than services in connection with the offering or sale of securities of the Company or one of its Subsidiaries in a capital-raising transaction or as a market maker or promoter of securities of the Company or one of its Subsidiaries) to the Company or one of its Subsidiaries and who is selected to participate in this Plan by the Administrator; provided, however, that a person who is otherwise an Eligible Person under clause (c) above may participate in this Plan only if such participation would not adversely affect either the Company’s eligibility to use Form S-8 to register under the Securities Act, the offering and sale of shares issuable under this Plan by the Company, or the Company’s compliance with any other applicable laws. “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. “Fair Market Value” shall mean, unless otherwise determined by the Committee, the fair market value of a share of Common Stock as of a particular date, determined as follows: (i) the closing sale price reported for such share of Common Stock for such date on the national securities exchange or national market system on which such stock is principally traded, or if no sale of shares of Common Stock is reported for such trading day, on the last preceding day on which a sale was reported, or (ii) if the shares of Common Stock are not then listed on a national securities exchange or national market system, or the value of such shares is not otherwise determinable, such value as determined by the Committee in good faith in its sole discretion consistent with the requirements under Section 409A of the Code. “Incentive Stock Option” or “ISO” shall mean an Option that is intended to comply with the requirements of Section 422 of the Code. “Non-Qualified Stock Option” shall mean an Option that is not intended to comply with the requirements of Section 422 of the Code. “Option” shall mean a right to purchase a specified number of shares of Common Stock during a specified period at a pre-established exercise price as determined by the Administrator, granted pursuant to Section 6.1.1. “Other-Stock Based Award” shall mean a stock-based Award issued pursuant to Section 6.1.7. “Participant” shall mean any Eligible Person that has been issued an Award under the Plan. “Performance Stock Unit” or “PSU” shall mean an Award evidencing the right to receive shares of Common Stock or equivalent value (as determined by the Administrator) based on the attainment of certain performance goals, issued pursuant to Section 6.1.5. “Plan” shall have the meaning set forth in Section 1 hereof. “Restricted Stock” shall mean shares of Common Stock that are subject to forfeiture and restrictions on transferability, issued pursuant to Section 6.1.3. “Restricted Stock Unit” or “RSU” shall mean an Award evidencing the right to receive one share of Common Stock or equivalent value (as determined by the 4 Administrator) that is restricted or subject to forfeiture provisions, issued pursuant to Section 6.1.4. “Section 409A” shall mean section 409A of the Code and related Treasury regulations and guidance promulgated thereunder. “Securities Act” shall mean the Securities Act of 1933, as amended. “Share Limit” shall have the number of shares available for issuance under the Plan as set forth in Section 4.1. “Stock Appreciation Right” or “SAR” shall mean a right to receive the appreciation value on the shares of Common Stock subject to the Award, issued pursuant to Section 6.1.2. “Subsidiary” shall mean any corporation (other than the Company) or other entity controlled by the Company directly or indirectly though one or more intermediaries. Construction. Except where otherwise indicated by the context, any masculine term used herein also shall include the feminine, the plural shall include the singular, and the singular shall include the plural. PLAN ADMINISTRATION Plan Administrator. This Plan shall be administered by, and all Awards under this Plan shall be authorized by, the Administrator. Any Committee appointed by the Board to act as the Administrator shall be comprised solely of one or more directors or such other number of directors as may be required under applicable law and the rules of any applicable stock exchange. A Committee may delegate some or all of its authority to another Committee so constituted. The Board or a Committee comprised solely of directors may also delegate, to the extent permitted by applicable law and the rules of any applicable stock exchange, to one or more officers of the Company, its powers under this Plan (a) to determine the Eligible Persons who will receive grants of Awards under this Plan, and (b) to determine the number of shares subject to, and the other terms and conditions of, such Awards. The Board may delegate different levels of authority to different Committees with administrative and grant authority under this Plan. Unless otherwise provided in the bylaws of the Company or the applicable charter of any Administrator: (a) a majority of the members of the acting Administrator shall constitute a quorum, and (b) the affirmative vote of a majority of the members present assuming the presence of a quorum or the unanimous written consent of the members of the Administrator shall constitute due authorization of an action by the acting Administrator. Grants of Awards, and transactions in or involving Awards, intended to be exempt under Rule 16b-3 under the Exchange Act, must be duly and timely authorized by the Board or a Committee consisting solely of two or more non-employee directors, as this requirement is applied under Rule 16b-3 promulgated under the Exchange Act. Awards granted to non-employee directors shall not be subject to the discretion of any officer or employee of the Company and shall be administered exclusively by the Board or a Committee consisting solely of independent directors. Powers of the Administrator. Subject to the express provisions of this Plan, the Administrator is authorized and empowered to do all things deemed necessary or desirable in connection with the authorization of Awards and the administration of this Plan (in the case of a delegation to a Committee or one or more officers, within the authority delegated to that Committee or person(s)), including, without limitation, the authority to: determine eligibility and, from among those persons determined to be eligible, the particular Eligible Persons who will receive Awards under this Plan; grant Awards to Eligible Persons, determine the type of Awards to be granted, the price at which securities will be offered or awarded and the number of securities to be offered or awarded to any of such persons, determine the other specific terms and conditions of such Awards consistent with the express limits of this Plan, establish the installments, if any, in which such Awards shall become exercisable or shall vest (which may include, without limitation, performance and/or time-based schedules), or determine that no delayed exercisability or vesting is required, establish any applicable performance targets, and establish the events of termination or reversion of such Awards; approve the forms of Award Agreements, which need not be identical either as to type of Award or among Participants; construe and interpret this Plan and any Award Agreements defining the rights and obligations of the Company, its Subsidiaries, and Participants under this Plan, further define the terms used in this Plan, and prescribe, amend and rescind rules and regulations relating to the administration of this Plan or the Awards granted under this Plan; cancel, modify, or waive the Company’s rights with respect to, or modify, discontinue, suspend, or terminate any or all outstanding Awards, subject to any required consent under Section 10.5.5; accelerate or extend the vesting or exercisability or extend the term of any or all outstanding Awards (in the case of Options or Stock Appreciation Rights, within the maximum ten (10)-year term of such Awards) in such circumstances as the Administrator may deem appropriate, including, without limitation, in connection with a termination of employment or services or other events of a personal nature, subject to any required consent under Section 10.5.5; adjust the number of shares of Common Stock subject to any Award, adjust the price of any or all outstanding Awards or otherwise change previously imposed terms and conditions, in such circumstances as the Administrator may deem appropriate, in each case subject to compliance with applicable stock exchange requirements, Sections 4 and 10.5.5, and provided that in no case, except due to an adjustment contemplated by Section 8, shall the terms of any outstanding Awards be amended, by amendment, cancellation and regrant, or other means, to reduce the per share exercise or base price of any outstanding Option or Stock Appreciation Right or other Award granted under this Plan, or be exchanged for cash, other Award or Option or Stock Appreciation Right with an exercise price that is less than the per share exercise price of the original Option or Stock Appreciation Right, without stockholder approval, and further provided that any adjustment or change in terms made pursuant to this Section 3.2(g) shall be made in a manner that, in the good faith determination of the Administrator will not likely result in the imposition of additional taxes or interest under Section 409A; determine the date of grant of an Award, which may be a designated date after but not before the date of the Administrator’s action, unless otherwise designated by the Administrator, the date of grant of an Award shall be the date upon which the Administrator took the action granting an Award; determine whether, and the extent to which, adjustments are required pursuant to Section 8 hereof and authorize the termination, conversion, substitution, acceleration or succession of Awards upon the occurrence of an event of the type described in Section 8; acquire or settle rights under Awards in cash, stock of equivalent value, or other consideration, subject to the provision of the Plan; and determine the Fair Market Value of the Common Stock or Awards under this Plan from time to time and/or the manner in which such value will be determined. Binding Determinations. Any action taken by, or inaction of, the Company, any Subsidiary, or the Administrator relating or pursuant to this Plan and within its authority hereunder or under applicable law shall be within the absolute discretion of that entity or body and shall be conclusive and binding upon all persons. Neither the Board, the Administrator, nor any Committee, nor any member thereof or person acting at the direction thereof, shall be liable for any act, omission, interpretation, construction or determination made in good faith in connection with this Plan or any Award made under this Plan, and all such persons shall be entitled to indemnification and reimbursement by the Company in respect of any claim, loss, damage or expense, including, without limitation, legal fees, arising or resulting therefrom to the fullest extent permitted by law. The foregoing right of indemnification shall be in addition to any right of indemnification set forth in the Company’s certificate of incorporation and bylaws, as the same may be amended from time to time, or under any directors and officers liability insurance coverage or written indemnification agreement with the Company that may be in effect from time to time. Reliance on Experts. In making any determination or in taking or not taking any action under this Plan, the Administrator may obtain and may rely upon the advice of experts, including professional advisors to the Company. The Administrator shall not be liable for any such action or determination taken or made or omitted in good faith based upon such advice. Delegation of Non-Discretionary Functions. In addition to the ability to delegate certain grant authority to officers of the Company as set forth in Section 3.1, the Administrator may also delegate ministerial, non-discretionary functions to individuals who are officers or employees of the Company or any of its Subsidiaries or to third parties. SHARES OF COMMON STOCK SUBJECT TO THE PLAN; SHARE LIMIT Shares of Common Stock Subject to the Plan; Share Limit. Subject to the adjustment as provided in Sections 8.1 and 10.9, the maximum number of shares of Common Stock available for issuance under the Plan will be equal to 8,500,000 shares of Common Stock, all of which may be granted, in the sole discretion of the Administrator, as Incentive Stock Options. Common Stock issued under the Plan shall be either authorized but unissued shares of Common Stock or, to the extent permitted, shares of Common Stock that have been reacquired by the Company or any Subsidiary. Counting of Shares. The Administrator may adopt reasonable counting procedures to ensure appropriate counting and to avoid double counting (as, for example, in the case of tandem or substitute Awards) as it may deem necessary or desirable in its sole discretion. Shares shall be counted against those reserved to the extent shares have been delivered pursuant to an Award and are no longer subject to a substantial risk of forfeiture. Accordingly, to the extent that an Award under the Plan, in whole or in part, is canceled, expired, forfeited, settled in cash, or otherwise terminated without delivery of shares of Common Stock to the Participant, the shares of Common Stock retained by or returned to the Company will not be deemed to have been delivered under the Plan, as applicable, and will be deemed to remain or become available under this Plan. Notwithstanding the foregoing, shares that are withheld from an Option or SAR as payment of the exercise price or the withholding taxes relating to the exercise of such Option or SAR, shares that are separately surrendered by the Participant as payment of the exercise price or the withholding taxes relating to the exercise of such Option or SAR, and the total number of shares subject to the exercised portion of a stock-settled SAR (regardless of the actual lesser of number shares delivered to the Participant), shall be deemed to have been issued hereunder and shall reduce the number of shares remaining available for issuance under the Plan. Shares that are withheld as payment of withholding taxes on any type of Award other than an Option or SAR shall be added back to the number of shares available for issuance under the Plan. Reservation of Shares; No Fractional Shares. The Company shall at all times reserve a number of shares of Common Stock sufficient to cover the Company’s obligations and contingent obligations to deliver shares with respect to Awards then outstanding under this Plan, exclusive of any dividend equivalent obligations to the extent the Company has the right to settle such rights in cash. No fractional shares shall be delivered under this Plan. The Administrator may pay cash in lieu of any fractional shares in settlements of Awards under this Plan. PARTICIPATION The Administrator may grant Awards under this Plan only to those persons that the Administrator determines to be Eligible Persons. The Administrator shall, in its sole and absolute discretion, select from among the Eligible Persons those individuals who shall receive Awards and become Participants under the Plan. There is no right of any Eligible Person to receive an Award under the Plan, and the Administrator has absolute discretion to treat Eligible Persons differently from one another under the Plan. Receipt of an Award by a Participant shall not create the right to receive future Awards under the Plan, but a Participant who has been granted an Award may, if otherwise eligible, be granted additional Awards if the Administrator shall so determine. AWARDS Type and Form of Awards. The Administrator shall determine the type or types of Award(s) to be made to each selected Eligible Person. Awards may be granted singly, in combination or in tandem. Awards may also be made in combination or in tandem with, in replacement of, as alternatives to, or as the payment form for grants or rights under any other employee or compensation plan of the Company or its Subsidiaries. The types of Awards that may be granted under this Plan are: 6.1.1 Stock Options. General Option Provisions. Options may only be granted to Eligible Persons for whom the Company would be deemed to be an “eligible issuer of service recipient stock,” as defined in Treasury Regulation 1.409A-1(b)(5)(iii)(E). An Option may be intended to be an Incentive Stock Option or a Non-Qualified Stock Option. The Award Agreement for an Option will indicate if the Option is intended to be an ISO or a Non-Qualified Stock Option. The maximum term of each Option, whether an ISO or a Non-Qualified Stock Option, shall be ten (10) years. The per share exercise price for each Option shall be not less than one hundred percent (100%) of the Fair Market Value of a share of Common Stock on the date of grant of the Option. Each Option shall become exercisable at such times and under such conditions and shall be subject to such other terms as may be determined by the Administrator in its discretion. When an Option is exercised, the exercise price for the shares underlying such Option shall be paid in full in cash or such other method permitted by the Administrator consistent with Section 6.4. Additional Rules Applicable to ISOs. Notwithstanding the general Option rules set forth in Section 6.1.1(a), the following rules shall apply to Options intended to qualify as ISOs. ISOs may only be granted to employees of the Company or its Subsidiaries (for this purpose, the term “subsidiary” is used as defined in Section 424(f) of the Code, which generally requires an unbroken chain of ownership of at least fifty percent (50%) of the total combined voting power of all classes of stock of each subsidiary in the chain beginning with the Company and ending with the subsidiary in question). To the extent that the aggregate Fair Market Value of shares of Common Stock determined at the time of grant of the applicable Option with respect to which ISOs first become exercisable by a Participant in any calendar year exceeds $100,000, taking into account both Common Stock subject to ISOs under this Plan and stock subject to ISOs under all other plans of the Company or its Subsidiaries or any parent or predecessor corporation, to the extent required by and within the meaning of Section 422 of the Code and the regulations promulgated thereunder, such Options shall be treated as Non-Qualified Stock Options. In reducing the number of Options treated as ISOs to meet the $100,000 limit, the most recently granted Options shall be reduced first. To the extent a reduction of simultaneously granted Options is necessary to meet the $100,000 limit, the Administrator may, in the manner and to the extent permitted by law, designate which shares of Common Stock are to be treated as shares acquired pursuant to the exercise of an ISO. An Award Agreement relating to ISOs may contain such other terms and conditions as from time to time are required in order for the Option to be considered an “incentive stock option,” as that term is defined in Section 422 of the Code. No ISO may be granted to any person who, at the time the Option is granted, owns, or is deemed to own under Section 424(d) of the Code, shares of outstanding Common Stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company, unless the exercise price of such option is at least one hundred and ten percent (110%) of the Fair Market Value of the stock subject to the Option and the term of such Option does not exceed five (5) years from the date such Option is granted. Stock Appreciation Rights. A SAR is an Award that entitles the Participant to receive, upon exercise of the SAR, a payment in cash and/or Common Stock, or a combination of the two, equal to, or having a Fair Market Value equal to, the product of (x) number of SARs being exercised multiplied by (y) the excess of (i) the Fair Market Value of a share of Common Stock on the date the SAR is exercised, over (ii) the “base price” applicable to the SAR. SARs may only be granted to Eligible Persons for whom the Company would be deemed to be an “eligible issuer of service recipient stock,” as defined in Treasury Regulation 1.409A-1(b)(5)(iii)(E). The base price of the SAR shall be determined by the Administrator but shall be not less than the Fair Market Value of the Company’s Common Stock on the date of grant. The maximum term of a SAR shall be ten (10) years. SARs shall become exercisable at such times and under such conditions and shall be subject to such other terms as may be determined by the Administrator in its discretion consistent with the terms and conditions of the Plan. Restricted Stock. General Restricted Stock Provisions. Restricted Stock is Common Stock subject to such restrictions on transferability, risk of forfeiture and other restrictions, if any, as the Administrator may impose, which restrictions may lapse separately or in combination at such times, under such circumstances, including based on achievement of performance goals and/or future service requirements, in such installments or otherwise, as the Administrator may determine at the date of grant or thereafter. Except to the extent restricted under the terms of this Plan and the applicable Award Agreement relating to the Restricted Stock, a Participant granted Restricted Stock shall have all of the rights of a stockholder of the Company, including the right to vote the Restricted Stock and the right to receive dividends thereon, subject to the provisions of Section 6.1.3(c) and Section 6.8. Certificates for Shares. Shares of Restricted Stock granted under this Plan may be evidenced in such manner as the Administrator shall determine. If certificates representing Restricted Stock are registered in the name of the Participant, the Administrator may require that such certificates bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Restricted Stock, that the Company retain physical possession of the certificates, and that the Participant deliver a stock power to the Company, endorsed in blank, relating to the Restricted Stock. The Administrator may require that shares of Restricted Stock are held in escrow until all restrictions lapse. Dividends and Splits. As a condition to the grant of an Award of Restricted Stock, any cash dividends paid on shares of Restricted Stock and any stock distributed in connection with a stock split or stock dividend, and any other property distributed as a dividend, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock with respect to which such dividend or distribution was made. In addition, and subject to applicable law, the Administrator may require or permit a Participant to elect that any cash dividends paid on Restricted Stock be automatically reinvested in additional shares of Restricted Stock or applied to the purchase of additional Awards under this Plan, subject to the same vesting schedule as the Restricted Stock to which the dividend relates. Restricted Stock Units. Grant of Restricted Stock Units. An RSU represents the right to receive from the Company on the relevant scheduled vesting or payment date for such RSU, one share of Common Stock or, if specified in the applicable Award Agreement, the Fair Market Value of one share of Common Stock paid in cash. The vesting or payment of an Award of RSUs may be subject to the attainment of specified performance goals or targets, forfeitability provisions and such other terms and conditions as the Administrator may determine, subject to the provisions of this Plan. Dividend Equivalent Accounts. If, and only if, required by the applicable Award Agreement, prior to the expiration of the applicable vesting period of an RSU, the Administrator shall provide dividend equivalent rights with respect to RSUs, in which case the Company shall establish an account for the Participant and reflect in that account any securities, cash or other property comprising any dividend or property distribution with respect to the shares of Common Stock underlying each RSU. Each amount or other property credited to any such account shall be subject to the same vesting conditions as the RSU to which it relates. In addition, subject to applicable law, the Administrator may require or permit a Participant to elect that any such dividend equivalent amounts credited to the Participant’s account be automatically deemed reinvested in additional RSUs or applied to the purchase of additional Awards under the Plan, subject to the same vesting schedule as the RSUs to which the dividend equivalent amounts relate. The Participant shall be paid the amounts or other property credited to such dividend equivalent account at the same time as payment of the RSU. Rights as a Stockholder. Subject to the restrictions imposed under the terms and conditions of this Plan and the applicable Award Agreement, each Participant receiving RSUs shall have no rights as a stockholder of the Company with respect to such RSUs until such time as shares of Common Stock are issued to the Participant. In the event an RSU is settled in cash, the Participant receiving RSUs shall never receive stockholder rights with respect to such Award. No shares of Common Stock shall be issued at the time an RSU is granted, and the Company will not be required to set aside funds for the payment of any such Award. Performance Stock Units. Grant of Performance Stock Units. A PSU is a performance-based Award that entitles the Participant to receive shares of Common Stock or, if specified in the Award Agreement, the Fair Market Value of such shares of Common Stock paid in cash, based on the attainment of one or more performance goals. Each Award of PSUs shall designate a target number of PSUs covered by the Award, with the actual number of shares of Common Stock earned, if any, to be based on a formula set forth in the Award Agreement related to the attainment of one or more performance goals set forth in the Award Agreement. Dividend Equivalent Accounts. If, and only if, required by the applicable Award Agreement, the Administrator shall pay dividend equivalent rights with respect to PSUs, in which case a Participant shall be entitled to a cash payment with respect to each PSU earned and payable in an amount based on the ordinary cash dividends that would have been payable to the Participant had the Participant been the owner of a number of actual shares of Common Stock equal to the number of PSUs earned, from the date of grant of the PSU Award through the date the PSU is paid. If so determined by the Administrator and set forth in the applicable Award Agreement, such cash amount may be credited with earnings or losses as if deemed reinvested in Common Stock or as if used to purchase additional Awards under the Plan. The amount payable shall be made in a single lump sum on the date on which payment is made in respect of the related PSUs. Rights as a Stockholder. Subject to the restrictions imposed under the terms and conditions of this Plan and the applicable Award Agreement, each Participant receiving PSUs shall have no rights as a stockholder of the Company with respect to such PSUs until such time as shares of Common Stock are issued to the Participant. In the event a PSU is settled in cash, the Participant receiving PSUs shall never receive stockholder rights with respect to such Award. No shares of Common Stock shall be issued at the time a PSU is granted, and the Company will not be required to set aside funds for the payment of any such Award. 6.1.6 Cash Awards. The Administrator may, from time to time, subject to the provisions of the Plan and such other terms and conditions as it may determine, grant cash bonuses, including without limitation, discretionary Awards, Awards based on objective or subjective performance criteria, Awards subject to other vesting criteria or Awards granted consistent with Section 6.1.7 below. Cash Awards may be awarded in such amount and at such times during the term of the Plan as the Administrator shall determine. 6.1.7 Other Awards. The other types of Awards that may be granted under this Plan include: (a) stock bonuses or similar rights to purchase or acquire shares, whether at a fixed or variable price or ratio related to the Common Stock (subject to compliance with applicable laws), upon the passage of time, the occurrence of one or more events, or the satisfaction of performance criteria or other conditions, or any combination thereof; or (b) any similar securities or rights with a value derived from the value of, or related to, the Common Stock and/or returns thereon. Award Agreements. Each Award, other than cash Awards described in Section 6.1.6, shall be evidenced by a written or electronic Award Agreement in the form approved by the Administrator and, if required by the Administrator, executed or accepted by the recipient of the Award. The Administrator may authorize any officer of the Company, other than the particular Award recipient, to execute any or all Award Agreements on behalf of the Company (electronically or otherwise). The Award Agreement shall set forth the material terms and conditions of the Award as established by the Administrator consistent with the express limitations of this Plan. Deferrals and Settlements. Except as otherwise set forth herein, payment of Awards may be in the form of cash, Common Stock, other Awards or combinations thereof as the Administrator shall determine, and with such restrictions as it may impose. The Administrator may also require or permit Participants to elect to defer the issuance of shares of Common Stock or the settlement of Awards in cash under such rules and procedures as it may establish under this Plan. The Administrator may also provide that deferred settlements include the payment or crediting of interest or other earnings on the deferral amounts, or the payment or crediting of dividend equivalents where the deferred amounts are denominated in shares. All mandatory or elective deferrals of the issuance of shares of Common Stock or the settlement of Awards in cash shall be structured in a manner that is intended to comply with, or be exempt from, the requirements of Section 409A of the Code. Consideration for Common Stock or Awards. The purchase price for any Award granted under this Plan or the Common Stock to be delivered pursuant to an Award, as applicable, may be paid by means of any lawful consideration as determined by the Administrator and subject to compliance with applicable laws, including, without limitation, one or a combination of the following methods: services rendered by the recipient of such Award; cash, check payable to the order of the Company, or electronic funds transfer; notice and third-party payment in such manner as may be authorized by the Administrator; the delivery of previously owned shares of Common Stock that are fully vested and unencumbered; by a reduction in the number of shares otherwise deliverable pursuant to the Award; or subject to such procedures as the Administrator may adopt, pursuant to a “cashless exercise” with an approved broker or dealer who provides financing for the purposes of, or who otherwise facilitates, the purchase or exercise of Awards. In the event that the Administrator allows a Participant to exercise an Award by delivering shares of Common Stock previously owned by such Participant and unless otherwise expressly provided by the Administrator, any shares delivered which were initially acquired by the Participant from the Company upon exercise of an Option or otherwise must have been owned by the Participant at least six (6) months as of the date of delivery, or such other period as may be required by the Administrator in order to avoid adverse accounting treatment. Shares of Common Stock used to satisfy the exercise price of an Option shall be valued at their Fair Market Value on the date of exercise. The Company will not be obligated to deliver any shares with respect to any Award unless and until it receives full payment of the exercise or purchase price therefor and any related withholding amounts under Section 9.1, and any other conditions to exercise or purchase, as established from time to time by the Administrator, have been satisfied. Unless otherwise expressly provided in the applicable Award Agreement, the Administrator may at any time eliminate or limit a Participant’s ability to pay the purchase or exercise price of any Award by any method other than cash payment to the Company. Minimum Vesting Schedule. Except as provided below, all Awards granted under the Plan shall have a minimum one (1) year cliff vesting schedule meaning that no portion of any Award may be scheduled to vest prior to one (1) year after the date of grant of such Award. Notwithstanding the foregoing, up to five percent (5%) of the total number of shares of Common Stock authorized by the Board and the stockholders for issuance under the Plan may be granted pursuant to Awards not subject to the minimum vesting schedule described above. The Administrator may adopt reasonable counting procedures to determine whether the five percent (5%) limit in the preceding sentence has been attained. The Administrator may also apply reasonable rules and rounding conventions to determine whether an Award complies with the above-referenced minimum vesting schedule. Transfer Restrictions. Limitations on Exercise and Transfer. Unless otherwise expressly provided in or pursuant to this Section 6.6, by applicable law or by an Award Agreement, as the same may be amended, (a) all Awards are non-transferable by the Participant and shall not be subject in any manner to sale, transfer, anticipation, alienation, assignment, pledge, encumbrance or charge; (b) Awards shall be exercised only by the Participant; and (c) amounts payable or shares issuable pursuant to any Award shall be delivered only to, or for the account of, the Participant. Exceptions. The Administrator may permit Awards to be exercised by and paid to, or otherwise transferred to, other persons or entities pursuant to such conditions and procedures, including limitations on subsequent transfers, as the Administrator may, in its sole discretion, establish in writing; provided that any such transfers of ISOs shall be limited to the extent permitted under the federal tax laws governing ISOs. Any permitted transfer shall be subject to compliance with applicable federal and state securities laws. Further Exceptions to Limits on Transfer. The exercise and transfer restrictions in Section 6.6.1 shall not apply to: transfers to the Company, the designation of a beneficiary to receive benefits in the event of the Participant’s death or, if the Participant has died, transfers to or exercise by the Participant’s beneficiary, or, in the absence of a validly designated beneficiary, transfers by will or the laws of descent and distribution, subject to any applicable limitations on ISOs, transfers to a current or former family member pursuant to a domestic relations order if approved or ratified by the Administrator, subject to any applicable limitations on ISOs, if the Participant has suffered a Disability, permitted transfers or exercises on behalf of the Participant by his or her legal representative, or the authorization by the Administrator of “cashless exercise” procedures with approved brokers or dealers who provide financing for the purpose of, or who otherwise facilitate, the exercise of Awards consistent with applicable laws and the express authorization of the Administrator. International Awards. One or more Awards may be granted to Eligible Persons who provide services to the Company or one of its Subsidiaries outside of the United States. Any Awards granted to such persons may, if deemed necessary or advisable by the Administrator, be granted pursuant to the terms and conditions of any applicable sub-plans, if any, appended to this Plan and approved by the Administrator. Dividend and Dividend Equivalents. Notwithstanding anything to the contrary herein, in no event may accrued dividends or dividend equivalents with respect to any Award issued under the Plan be paid prior to the vesting of the Award to which they relate. EFFECT OF TERMINATION OF SERVICE ON AWARDS Termination of Employment. Administrator Determination. The Administrator shall establish the effect of a termination of employment or service on the rights and benefits under each Award under this Plan and in so doing may make distinctions based upon, inter alia, the cause of termination and type of Award. If the Participant is not an employee of the Company or one of its Subsidiaries and provides other services to the Company or one of its Subsidiaries, the Administrator shall be the sole judge for purposes of this Plan, unless a contract or the Award Agreement otherwise provides, of whether the Participant continues to render services to the Company or one of its Subsidiaries and the date, if any, upon which such services shall be deemed to have terminated. General. For any Award issued under the Plan, unless the Award Agreement provides otherwise, the portion of such Award that is unvested at the time that a Participant’s employment or service is terminated for any or no reason shall be forfeited and reacquired by the Company; provided however, that the Administrator may provide, by rule or regulation or in any Award Agreement, or may determine in any individual case, that such forfeiture requirement shall be waived in whole or in part. Stock Options and SARs. For Awards of Options or SARs, unless the Award Agreement provides otherwise, the exercise period of such Options or SARs shall expire: three (3) months after the last day that the Participant is employed by, or provides services to, the Company or its Subsidiaries; provided however, that in the event of the Participant’s death during this period, those persons entitled to exercise the Option or SAR pursuant to the laws of descent and distribution shall have one (1) year following the date of the Participant’s death within which to exercise such Option or SAR; twelve (12) months after the last day that the Participant is employed by, or provides services to, the Company or a Subsidiary in the case of a Participant whose termination of employment or service is due to death or Disability; and immediately upon a Participant’s termination for Cause. The Administrator will, in its absolute discretion, determine the effect of all matters and questions relating to a termination of a Participant’s employment or service, including, but not limited to, the question of whether a leave of absence constitutes a termination of employment or service and whether a Participant’s termination is for Cause. Events Not Deemed Terminations of Service. Unless the express policy of the Company or any of its Subsidiaries or the Administrator otherwise provides, the employment relationship shall not be considered terminated in the case of (a) sick leave, (b) military leave, or (c) any other paid leave of absence authorized by the Company or one of its Subsidiaries, or the Administrator; provided that unless reemployment upon the expiration of such leave is guaranteed by contract or law, such leave is for a period of not more than three (3) months. In the case of any employee of the Company or one of its Subsidiaries on an approved leave of absence, continued vesting of the Award while on leave from the employ of the Company or one of its Subsidiaries may be suspended until the employee returns to service, unless the Administrator otherwise provides or applicable law otherwise requires. In no event shall an Award be exercised after the expiration of the term set forth in the Award Agreement. Change in Time Commitment. In the event a Participant’s regular level of time commitment in the performance of his or her services for the Company or any Subsidiaries is reduced (for example, and without limitation, if the Participant is an employee of the Company and the Participant has a change in status from full-time to part-time or takes an extended leave of absence) after the date of grant of any Award, the Administrator, in its sole discretion, may (a) make a corresponding reduction in the number of shares or cash amount subject to any portion of such Award that is scheduled to vest or become payable after the date of such change in time commitment, and (b) in lieu of or in combination with such a reduction, extend the vesting schedule applicable to such Award in accordance with Section 409A, as applicable. In the event of any such reduction, the Participant will have no right with respect to any portion of the Award that is so amended. Effect of Change of Subsidiary Status. For purposes of this Plan and any Award, if an entity ceases to be a Subsidiary of the Company, a termination of employment or service shall be deemed to have occurred with respect to each Eligible Person in respect of such Subsidiary who does not continue as an Eligible Person in respect of the Company or another Subsidiary that continues as such after giving effect to the transaction or other event giving rise to the change in status. ADJUSTMENTS; ACCELERATION Adjustments. Upon or in contemplation of (a) any reclassification, recapitalization, stock split (including a stock split in the form of a stock dividend) or reverse stock split, (b) any merger, arrangement, combination, consolidation, or other reorganization, (c) any spin-off, split-up, or similar extraordinary dividend distribution in respect of the Common Stock, whether in the form of securities or property, or (d) any exchange of Common Stock or other securities of the Company, or any similar unusual or extraordinary corporate event or transaction affecting the Common Stock, the Administrator shall in such manner, to such extent and at such time as it deems appropriate and equitable in the circumstances, but subject to compliance with applicable laws and stock exchange requirements, proportionately adjust any or all of (1) the number and type of shares of Common Stock or other securities that thereafter may be made the subject of Awards, including the Share Limit and the limit on the number of ISOs issuable under the Plan, (2) the number, amount and type of shares of Common Stock or other securities or property subject to any or all outstanding Awards, (3) the grant, purchase or exercise price, including the base price of any SAR or similar right, of any or all outstanding Awards, and (4) the securities, cash or other property deliverable upon exercise or payment of any outstanding Awards. Any adjustment made pursuant to this Section 8.1 shall be made in a manner that, in the good faith determination of the Administrator, will not likely result in the imposition of additional taxes or interest under Section 409A of the Code. With respect to any Award of an ISO, the Administrator may make an adjustment that causes the Option to cease to qualify as an ISO without the consent of the affected Participant. Any determinations made by the Administrator pursuant to this Section 8.1 shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of Common Stock of any class, or securities convertible into shares of Common Stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock subject to an Award. Change in Control. Unless otherwise provided in an applicable Award Agreement, in the event of a Change in Control, the Administrator shall have full discretion to take whatever actions it deems necessary or appropriate with respect to outstanding Awards, including, but not limited to: (a) to provide for full or partial accelerated vesting of any Award or portion thereof, either immediately prior to such Change in Control or on such terms and conditions following the Change in Control (such as a termination without Cause) as the Administrator determines in its sole and absolute discretion, (b) to provide for the assumption of such Awards or portions thereof or the substitution of such Awards or portions thereof with similar awards of the surviving or acquiring company or parent thereof, in a manner designed to comply with Section 409A of the Code, (c) to provide for the settlement in cash or property and cancellation of any Award or portions thereof immediately prior to such Change in Control, which settlement may, in a manner designed to comply with Code Section 409A, be subject to any escrow, earn-out or other contingent or deferred payment arrangement that is contemplated by such Change in Control, and (d) take any other actions as the Administrator deems necessary or advisable in connection with such Change in Control transaction; provided, however, that in the event the surviving or acquiring company does not assume the outstanding Awards or portions thereof or substitute similar stock awards for those outstanding under the Plan as of the Change in Control, then (a) the vesting and exercisability, if applicable, of all Awards or portions thereof shall be accelerated in full immediately prior to such Change in Control, with all performance goals or other vesting criteria applicable to any performance-based Awards deemed achieved based on performance measured through the date of the Change in Control, and (b) such outstanding Awards or portions thereof shall terminate and/or be payable upon the occurrence of the Change in Control. The Administrator may take different actions with respect to different Participants under the Plan, different Awards under the Plan, and different portions of Awards granted under the Plan. TAX PROVISIONS Tax Withholding. Upon any exercise, vesting, or payment of any Award, the Company or one of its Subsidiaries shall have the right at its option to: require the Participant, or the Participant’s personal representative or beneficiary, as the case may be, to pay or provide for payment of at least the minimum amount of any taxes which the Company or its Subsidiaries may be required to withhold with respect to such Award event or payment; or deduct from any amount otherwise payable in cash to the Participant, or the Participant’s personal representative or beneficiary, as the case may be, the minimum amount of any taxes which the Company or its Subsidiaries may be required to withhold with respect to such cash payment. In any case where a tax is required to be withheld in connection with the delivery of shares of Common Stock under this Plan, the Administrator may in its sole discretion, subject to Section 10.1, grant (either at the time of the Award or thereafter) to the Participant the right to elect, pursuant to such rules and subject to such conditions as the Administrator may establish, to have the Company reduce the number of shares to be delivered by or otherwise reacquire the appropriate number of shares, valued in a consistent manner at their Fair Market Value or at the sales price in accordance with authorized procedures for cashless exercises, necessary to satisfy the applicable withholding obligation on exercise, vesting or payment, not in excess of the maximum statutory rates in the Participant’s applicable jurisdictions. Requirement of Notification of Code Section 83(b) Election. If any Participant shall make an election under Section 83(b) of the Code (to include in gross income in the year of transfer the amounts specified in Section 83(b) of the Code) or under a similar provisions of the laws of a jurisdiction outside the United States, such Participant shall notify the Company of such election within ten (10) days after filing notice of the election with the Internal Revenue Service or other government authority, in addition to any filing and notification required pursuant to regulations issued under Code Section 83(b) or other applicable provision. Requirement of Notification of Disqualifying Disposition. If any Participant shall make any disposition of shares of Common Stock delivered to the Participant pursuant to the exercise of an ISO under the circumstances described in Code Section 421(b) relating to certain disqualifying dispositions, such Participant shall notify the Company of such disposition within ten (10) days thereof. OTHER PROVISIONS Compliance with Laws. This Plan, the granting and vesting of Awards under this Plan, the offer, issuance and delivery of shares of Common Stock, the payment of money under this Plan or under Awards are subject to compliance with all applicable federal and state laws, rules and regulations and to such approvals by any applicable stock exchange listing, regulatory or governmental authority as may, in the opinion of the counsel for the Company, be necessary or advisable in connection therewith. The person acquiring any securities under this Plan will, if requested by the Company or any of its Subsidiaries, provide such assurances and representations to the Company or any of its Subsidiaries as the Administrator may deem necessary or desirable to assure compliance with all applicable legal and accounting requirements. Future Awards/Other Rights. No person shall have any claim or rights to be granted an Award or additional Awards, as the case may be, under this Plan, subject to any express contractual rights set forth in a document other than this Plan to the contrary. No Employment/Service Contract. Nothing contained in this Plan or in any other documents under this Plan or in any Award Agreement shall confer upon any Eligible Person or other Participant any right to continue in the employ or other service of the Company or any of its Subsidiaries, constitute any contract or agreement of employment or other service or affect an employee’s status as an employee at-will, nor shall interfere in any way with the right of the Company or its Subsidiaries to change a person’s compensation or other benefits, or to terminate his or her employment or other service, with or without Cause. Nothing in this Section 10.3, however, is intended to adversely affect any express independent right of such person under a separate employment or service contract other than an Award Agreement. Plan Not Funded. Awards payable under this Plan shall be payable in shares of Common Stock or from the general assets of the Company, and no special or separate reserve, fund or deposit shall be made to assure payment of such Awards. No Participant, beneficiary or other person shall have any right, title or interest in any fund or in any specific asset (including shares of Common Stock, except as expressly otherwise provided) of the Company or any of its Subsidiaries by reason of any Award hereunder. Neither the provisions of this Plan or of any related documents, nor the creation or adoption of this Plan, nor any action taken pursuant to the provisions of this Plan shall create, or be construed to create, a trust of any kind or a fiduciary relationship between the Company or any of its Subsidiaries and any Participant, beneficiary or other person. To the extent that a Participant, beneficiary or other person acquires a right to receive payment pursuant to any Award hereunder, such right shall be no greater than the right of any unsecured general creditor of the Company. Effective Date, Termination and Suspension, Amendments Effective Date and Termination. This Plan was approved by the Board and shall become effective upon approval by the stockholders of the Company. Unless earlier terminated by the Board, this Plan shall terminate at the close of business ten (10) years after the date on which it was approved by the Board. After the termination of this Plan either upon such stated expiration date or its earlier termination by the Board, no additional Awards may be granted under this Plan, but previously granted Awards and the authority of the Administrator with respect thereto, including the authority to amend such Awards, shall remain outstanding in accordance with their applicable terms and conditions and the terms and conditions of this Plan. Amendment; Termination. The Board may, at any time, terminate or, from time to time, amend, modify or suspend this Plan, in whole or in part. No Awards may be granted during any period that the Board suspends this Plan. Stockholder Approval. To the extent then required by applicable law or any applicable stock exchange rule or required to preserve the intended tax consequences of this Plan, or deemed necessary or advisable by the Board, this Plan and any amendment to this Plan shall be subject to approval by the stockholders of the Company. Amendments to Awards. Without limiting any other express authority of the Administrator under, but subject to, the express limits of this Plan, the Administrator may by agreement or resolution waive conditions of or limitations on Awards to Participants that the Administrator in the prior exercise of its discretion has imposed, without the consent of a Participant, and, subject to the requirements of Sections 3.2 and 10.5.5, may make other changes to the terms and conditions of Awards. Any amendment or other action that would constitute a repricing of an Award is subject to the limitations and stockholder approval requirements set forth in Section 3.2(g). Limitations on Amendments to Plan and Awards. No amendment, suspension or termination of this Plan or change of or affecting any outstanding Award shall, without written consent of the Participant, affect in any manner materially adverse to the Participant any rights or benefits of the Participant or obligations of the Company under any Award granted under this Plan. Changes, settlements and other actions contemplated by Section 8 shall not be deemed to constitute changes or amendments for purposes of this Section 10.5.5. Privileges of Stock Ownership. Except as otherwise expressly authorized by the Administrator or this Plan, a Participant shall not be entitled to any privilege of stock ownership as to any shares of Common Stock not actually delivered to and held of record by the Participant. Except as expressly provided herein, no adjustment will be made for dividends or other rights as a stockholder of the Company for which a record date is prior to such date of delivery. Governing Law; Severability; Construction. Choice of Law. This Plan, the Awards, all documents evidencing Awards and all other related documents shall be governed by, and construed in accordance with the laws of the State of Delaware. Severability. If a court of competent jurisdiction holds any provision of this Plan invalid and unenforceable, the remaining provisions of this Plan shall continue in effect and the Plan shall be construed and enforced without regard to the illegal or invalid provision. Plan Construction Rule 16b-3. It is the intent of the Company that the Awards and transactions permitted by the Awards be interpreted in a manner that, in the case of Participants who are or may be subject to Section 16 of the Exchange Act, qualify, to the maximum extent compatible with the express terms of the Award, for exemption from matching liability under Rule 16b-3 promulgated under the Exchange Act. Notwithstanding the foregoing, the Company shall have no liability to any Participant for Section 16 consequences of Awards or events under Awards if an Award or event does not so qualify. Compliance with Section 409A of the Code. The Board intends that, except as may be otherwise determined by the Administrator, any Awards under the Plan will be either exempt from, or satisfy the requirements of, Section 409A to avoid the imposition of any taxes, including additional income or penalty taxes, thereunder. If the Administrator determines that an Award, Award Agreement, acceleration, adjustment to the terms of an Award, payment, distribution, deferral election, transaction or any other action or arrangement contemplated by the provisions of the Plan would, if undertaken, cause a Participant’s Award to violate Section 409A, unless the Administrator expressly determines otherwise, such Award, Award Agreement, payment, acceleration, adjustment, distribution, deferral election, transaction or other action or arrangement shall not be undertaken and the related provisions of the Plan and/or Award Agreement will be deemed modified or, if necessary, rescinded in order to comply with the requirements of Section 409A to the extent determined by the Administrator without the consent of or notice to the Participant. Notwithstanding the foregoing, neither the Company nor the Administrator shall have any obligation to take any action to prevent the assessment of any excise tax or penalty on any Participant under Section 409A. No Guarantee of Favorable Tax Treatment. Although the Company intends that Awards under the Plan will be exempt from, or will comply with, the requirements of Section 409A of the Code, the Company does not warrant that any Award under the Plan will qualify for favorable tax treatment under Section 409A of the Code or any other provision of federal, state, local or foreign law. The Company shall not be liable to any Participant for any tax, interest or penalties the Participant might owe as a result of the grant, holding, vesting, exercise or payment of any Award under the Plan. Stock-Based Awards in Substitution for Stock Options or Awards Granted by Other Corporation. Awards may be granted to Eligible Persons in substitution for or in connection with an assumption of employee stock options, stock appreciation right, restricted stock or other stock-based awards granted by other entities to persons who are or who will become Eligible Persons in respect of the Company or one of its Subsidiaries, in connection with a distribution, arrangement, business combination, merger or other reorganization by or with the granting entity or an affiliated entity, or the acquisition by the Company or one of its Subsidiaries, directly or indirectly, of all or a substantial part of the stock or assets of the employing entity. The Awards so granted need not comply with other specific terms of this Plan, provided the Awards reflect only adjustments giving effect to the assumption or substitution consistent with the conversion applicable to the Common Stock in the transaction and any change in the issuer of the security. Any shares that are delivered and any Awards that are granted by, or become obligations of, the Company, as a result of the assumption by the Company of, or in substitution for, outstanding Awards previously granted by an acquired company or previously granted by a predecessor employer (or direct or indirect parent thereof) in the case of persons that become employed by the Company or one of its Subsidiaries in connection with a business or asset acquisition or similar transaction, shall not be counted against the Share Limit or other limits on the number of shares available for issuance under this Plan, except as may otherwise be provided by the Administrator at the time of such assumption or substitution or as may be required to comply with the requirements of any applicable stock exchange. Non-Exclusivity of Plan. Nothing in this Plan shall limit or be deemed to limit the authority of the Board or the Administrator to grant Awards or authorize any other compensation, with or without reference to the Common Stock, under any other plan or authority. No Corporate Action Restriction. The existence of this Plan, the Award Agreements and the Awards granted hereunder shall not limit, affect or restrict in any way the right or power of the Board or the stockholders of the Company to make or authorize: (a) any adjustment, recapitalization, reorganization or other change in the capital structure or business of the Company or any Subsidiary, (b) any merger, arrangement, business combination, amalgamation, consolidation or change in the ownership of the Company or any Subsidiary, (c) any issue of bonds, debentures, capital, preferred or prior preference stock ahead of or affecting the capital stock (or the rights thereof) of the Company or any Subsidiary, (d) any dissolution or liquidation of the Company or any Subsidiary, (e) any sale or transfer of all or any part of the assets or business of the Company or any Subsidiary, or (f) any other corporate act or proceeding by the Company or any Subsidiary. No Participant, beneficiary or any other person shall have any claim under any Award or Award Agreement against any member of the Board or the Administrator, or the Company or any employees, officers or agents of the Company or any Subsidiary, as a result of any such action. Other Company Benefit and Compensation Programs. Payments and other benefits received by a Participant under an Award made pursuant to this Plan shall not be deemed a part of a Participant’s compensation for purposes of the determination of benefits under any other employee welfare or benefit plans or arrangements, if any, provided by the Company or any Subsidiary, except where the Administrator expressly otherwise provides or authorizes in writing, or except as otherwise specifically set forth in the terms and conditions of such other employee welfare or benefit plan or arrangement. Awards under this Plan may be made in addition to, in combination with, as alternatives to or in payment of grants, Awards or commitments under any other plans or arrangements of the Company or its Subsidiaries. Restrictive Covenants; Cause Forfeiture; Recoupment Policy. 10.12.1 Restrictive Covenants. The Company may retain the right in an Award Agreement to cause a forfeiture of the gain realized by a Participant on account of actions taken by the Participant in violation or breach of or in conflict with any non-competition agreement, any agreement prohibiting solicitation of employees of the Company or any Affiliate thereof or any confidentiality obligation or post-employment cooperation agreement with respect to the Company or any Affiliate, to the extent specified in such Award Agreement applicable to the Participant. 10.12.2 Annulment upon Termination for Cause. The Administrator may annul an Award if the Participant is an employee of the Company or an Affiliate thereof and is terminated for Cause. 10.12.3 Awards Subject to Recoupment. Notwithstanding any other provision of this Plan to the contrary, any Award granted or amount payable or paid under this Plan shall be subject to the terms of any compensation recoupment policy then applicable, if any, of the Company, to the extent the policy applies to such Award or amount. By accepting an Award or the payment of any amount under the Plan, each Participant agrees and consents to the Company’s application, implementation and enforcement of (a) any such policy and (b) any provision of applicable law relating to cancellation, rescission, payback or recoupment of compensation, and expressly agrees that the Company may take such actions as are permitted under the policy or applicable law without further consent or action being required by such Participant. To the extent that the terms of this Plan and the policy or applicable law conflict, then the terms of the policy or applicable law shall prevail. Captions. Captions and headings are given to the sections and subsections of this Plan solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of this Plan or any provision thereof. As adopted by the Board of Directors of TTEC Holdings, Inc. on February 27, 2020, and as amended by the Board of Directors of TTEC Holdings, Inc. on February 21, 2024. ![](https://capedge.com/proxy/DEF 14A/0001104659-24-045835/tm242641d1_def14asp013img001.jpg)
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| Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS DETACH AND RETURN THIS PORTION ONLY THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. D73696-P68061V41072-P08083 For Withhold For Against Abstain For Against !! ! 9197 SOUTH PEORIA STREET ENGLEWOOD,! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! 6312 S. FIDDLER'S GREEN CIRCLE SUITE 100N GREENWOOD VILLAGE, CO 8011280111 VOTE BY INTERNET Before The Meeting - Go to www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m., Eastern Time, on May 21, 2024. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. During The Meeting - Go to www.virtualshareholdermeeting.com/TTEC2024 You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m., Eastern Time, on May 21, 2024. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. SCAN TO VIEW MATERIALS & VOTEw TTEC HOLDINGS, INC. 1a. Kenneth D. Tuchman 1c. Tracy L. Bahl 1d. Gregory A. Conley 1e. Robert N. Frerichs 1f. Marc L. Holtzman 1g. Gina L. Loften 1h. Ekta Singh-Bushell 1b. Steven J. Anenen NOTE: This proxy, when properly executed, will be voted in the manner directed herein. If no direction is made, the proxy will be voted FOR all of the Board of Directors' nominees and FOR Proposal 2.all Proposals. NOTE: Such other business as may properly come before the meeting or any adjournment thereof. 1. Election of Director Nominees The Board of Directors recommends you vote FOR the following: Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary,fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.officer. 2. The ratificationRatification of the appointment of PricewaterhouseCoopersPricewaterhouse Coopers LLP as TTEC's independent registered public accounting firmIndependent Registered Public Accounting Firm for 2022.2024. 3. Such other business as may properly come beforeApproval of an Amendment to the meeting or any adjournment thereof. !! ! !! ! !! ! !! ! !! ! !! ! !! ! For Against Abstain !!TTEC 2020 Equity Incentive Plan. ! ! ! VOTE BY INTERNET Before The Meeting - Go to www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m., Eastern Time, on May 24, 2022. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. During The Meeting - Go to www.virtualshareholdermeeting.com/TTEC2022 You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m., Eastern Time, on May 24, 2022. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. SCAN TO VIEW MATERIALS & VOTE Z |
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| D73697-P68061V41073-P08083 Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice and Proxy Statement and TTEC Annual Report on Form 10-K and related information including TTEC CEO's Letter to Stockholders are available at www.proxyvote.com. Please date, sign and mail your proxy card in the enclosed envelope as soon as possible. This Proxy is Solicited on Behalf of The Board of Directors of TTEC HOLDINGS, INC. The undersigned, having received the Notice of Annual Meeting and Proxy Statement, hereby appoints KENNETH D. TUCHMAN and MARGARET B. McLEAN, and each of them, as proxies with full power of substitution, for and in the name of the undersigned, to vote all shares of Common Stock of TTEC HOLDINGS, INC. owned of record by the undersigned at the 20222024 Annual Meeting of Stockholders to be held virtually at www.virtualshareholdermeeting.com/TTEC2022TTEC2024 on May 25, 202222, 2024 at 10:00 a.m., MDT, and any adjournments or postponements thereof, in accordance with the directions marked on the reverse side hereof. The proxies, or each of them, in their discretion, are authorized to vote for the election of a person nominated to the Board of Directors if any nominee named herein becomes unable to serve or if for any reason whatsoever, another nominee is required, and the proxies, or each of them, in their discretion, are further authorized to vote on other matters which may properly come before the 20222024 Annual Meeting and any adjournments or postponements thereof. You are encouraged to specify your choices by marking the appropriate boxes (SEE REVERSE SIDE), but you need not mark any boxes if you wish to vote in accordance with the Board of Directors' recommendations. The proxies cannot vote these shares unless you sign and return this card. Continued and to be signed on reverse side
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