XML 17 R53.htm IDEA: XBRL DOCUMENT v2.4.0.8
COMMITMENTS AND CONTINGENCIES (DETAILS) (NARRATIVE)
6 Months Ended 6 Months Ended 6 Months Ended
Jun. 30, 2013
USD ($)
Jun. 30, 2012
USD ($)
Dec. 31, 2012
USD ($)
Jun. 30, 2013
Sao Paolo Brazil [Member]
Mar. 31, 2012
Sao Paolo Brazil [Member]
USD ($)
Mar. 31, 2012
Sao Paolo Brazil [Member]
BRL
Jun. 30, 2013
Google [Member]
COMMITMENTS AND CONTINGENCIES [Abstract]              
Initiation date of current line of credit agreement Jun. 03, 2013            
Line of Credit Facility, Rationale for Classification as Long-Term Debt 5 Year Term            
Initial Borrowing Capacity $ 700,000,000            
Maximum Borrowing Capacity 1,000,000,000            
Description of line of credit agreement The Credit Agreement provides for a secured revolving credit facility that matures on June 3, 2018 with an initial maximum aggregate commitment of $700.0 million. At the Company’s discretion, direct borrowing options under the Credit Agreement include (i) Eurodollar loans with one, two, three, and six month terms, and/or (ii) overnight base rate loans. The Credit Agreement also provides for a sub-limit for loans or letters of credit in both U.S. dollars and certain foreign currencies, with direct foreign subsidiary borrowing capabilities up to 50% of the total commitment amount. The Company may increase the maximum aggregate commitment under the Credit Agreement to $1.0 billion if certain conditions are satisfied, including that the Company is not in default under the Credit Agreement at the time of the increase and that the Company obtains the commitment of the lenders participating in the increase. Base rate loans bear interest at a rate equal to the greatest of (i) Wells Fargo’s prime rate, (ii) one half of 1% in excess of the federal funds effective rate, and (iii) 1.25% in excess of the one month London Interbank Offered Rate (“LIBOR”), in each case adding a margin based upon the Company’s leverage ratio. Eurodollar loans bear interest based upon LIBOR, plus a margin based upon the Company’s leverage ratio. Alternate loans bear interest at rates applicable to their respective currencies. Letter of credit fees are one eighth of 1% of the stated amount of the letter of credit on the date of issuance, renewal or amendment, plus an annual fee equal to the borrowing margin for Eurodollar loans. Commitment fees are payable to the Lenders in an amount equal to the unused portion of the credit facility and are based upon the Company’s leverage ratio. Indebtedness under the Credit Agreement is guaranteed by certain of the Company’s present and future domestic subsidiaries. Indebtedness under the Credit Agreement and the related guarantees are secured by security interests (subject to permitted liens) in the U.S. accounts receivable and cash of the Company and certain of its domestic subsidiaries and may be secured by tangible assets of the Company and such domestic subsidiaries if borrowings by foreign subsidiaries exceed $100.0 million and the leverage ratio is greater than 3.00 to 1.00. The Company also pledged 65% of the voting stock and 100% of the non-voting stock of certain of the Company’s material foreign subsidiaries and may pledge 65% of the voting stock and 100% of the non-voting stock of the Company’s other foreign subsidiaries. The Credit Agreement, which includes customary financial covenants, may be used for general corporate purposes, including working capital, purchases of treasury stock and acquisition financing.            
Borrowings outstanding on credit facility 110,000,000   108,000,000        
Average daily utilization under credit facility 230,900,000 137,400,000          
Letters of credit issued under credit facility 3,800,000            
Remaining borrowing capacity under credit facility 586,200,000            
Letters of credit issued outside credit facility 500,000            
Loss Contingencies [Line Items]              
Loss Contingency, Actions Taken by Plaintiff       In 2009, the municipality of Sao Paolo, Brazil assessed our Brazilian subsidiary, TeleTech Brasil Servicos Ltda. (“TTEC Brasil”), a services tax on certain equipment rental income earned in 2004 and 2005. In first quarter of 2011, TTEC Brasil filed a tax annulment action to challenge the assessment. In second quarter of 2012, the court issued a ruling on the matter in favor of Sao Paolo municipality, which ruling TTEC Brasil is currently appealing, with the resolution of the matter not currently expected until 2015     In the fourth quarter of 2012, a complaint was filed in the State of California against a TeleTech subsidiary and Google Inc. (“Google”), as co-defendants. The action alleges that the defendants violated California Penal Code Section 632 by recording telephone calls made on behalf of Google to residents in California without disclosure. The plaintiff seeks class action certification in the matter.
Loss Contingency, Management's Assessment and Process Based on an opinion received from legal counsel in Brazil, TeleTech believes that (i) the ruling issued by the Sao Paolo municipal court was incorrect and in contravention of a Brazil Supreme Court ruling concerning the invalidity of services taxes on rental income, (ii) TTEC Brasil has valid defenses against the assessed services taxes and (iii) that payment of these services taxes is not probable. Based on the foregoing, TeleTech has not recorded an expense as of June 30, 2013 for the Sao Paolo services tax assessment. No new development occurred in this matter during the current quarter.           Pursuant to its contractual commitments, the Company has agreed to indemnify Google for costs and expenses related to the complaint. The ultimate outcome of this litigation, and an estimate of the possible loss, if any, cannot reasonably be determined at this time. Management believes that the loss, if any, is adequately insured as part of the Company’s insurance program and the outcome of this litigation should not have a material adverse effect on its financial position or results of operations.
Loss Contingency, Judicial Deposit Made         $ 3,600,000 6,900,000