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EMPLOYEE COMPENSATION PLANS | 12 Months Ended
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Dec. 31, 2019
EMPLOYEE COMPENSATION PLANS [Abstract] |
EMPLOYEE COMPENSATION PLANS | (19)EMPLOYEE COMPENSATION PLANS Employee Benefit Plan The Company currently has a 401(k) profit-sharing plan that allows participation by U.S. employees who have completed six months of service, as defined, and are 21 years of age or older. Participants may defer up to 75% of their gross pay, up to a maximum limit determined by U.S. federal law. Participants are also eligible for a matching contribution. The Company may from time to time, at its discretion, make a “matching contribution” based on the amount and rate of the elective deferrals. The Company determines how much, if any, it will contribute for each dollar of elective deferrals. Participants vest in matching contributions over a three-year period. Company matching contributions to the 401(k) plan(s) totaled $6.7 million, $5.2 million and $5.7 million for the years ended December 31, 2019, 2018 and 2017, respectively. Equity Compensation Plans In May 2010, the Company adopted the TeleTech Holdings, Inc. 2010 Equity Incentive Plan, renamed TTEC Holdings, Inc. 2010 Incentive Plan in 2018 (the “2010 Plan”). An aggregate of 4.0 million shares of common stock has been reserved for issuance under the 2010 Plan, which permits the award of incentive stock options, non-qualified stock options, stock appreciation rights, shares of restricted common stock and RSUs. The 2010 Plan also provides for annual equity-based compensation grants to members of the Company’s Board of Directors. Options granted to employees generally vest over four to five years and have a contractual life of ten years. Options issued to Directors vest over one year and have a contractual life of ten years. As of December 31, 2019, a total of 4.0 million shares were authorized and 1.1 million shares were available for issuance under the 2010 Plan. The 2010 Plan expires in 2020 and additional shares cannot be issued under the plan starting March 30, 2020. In February 2020, the Company adopted the TTEC Holdings, Inc., 2020 Equity Incentive Plan (the “2020 Plan”), which permits awards of incentive stock options, non-qualified stock options, stock appreciation rights, shares of restricted common stock, performance stock units and restricted stock units. The 2020 Plan will also provide for annual equity-based compensation grants to members of the Company’s Board of Directors. Options granted to employees under the 2020 Plan generally vest over three to five years and have a contractual life of ten years. Options issued to Directors vest over one year and have a contractual life of ten years. As part of the 2020 Annual Stockholder Meeting, the Company plans to seek shareholder approval for the 2020 Plan, including 4.0 million shares of common stock to be reserved for issuance under the Plan. For the years ended December 31, 2019, 2018, and 2017, the Company recorded total equity-based compensation expense under all equity-based arrangements (stock options and RSUs) of $12.8 million, $12.1 million and $11.9 million, respectively. For 2019, 2018 and 2017, of the total compensation expense, $4.7 million, $4.7 million and $4.1 million was recognized in Cost of services and $8.1 million, $7.4 million and $7.8 million, was recognized in Selling, general and administrative in the Consolidated Statements of Comprehensive Income (Loss), respectively. For the years ended December 31, 2019, 2018, and 2017, the Company recognized a tax benefit under all equity-based arrangements (stock options and RSUs) of $4.2 million, $3.7 million and $6.8 million, respectively. Restricted Stock Units 2017, 2018 and 2019 RSU Awards: The Company granted RSUs in 2017, 2018 and 2019 to new and existing employees that vest over four or five years. The Company also granted RSUs in 2017, 2018 and 2019 to members of the Board of Directors that vest over one year. During 2015, the Company granted performance-based RSUs to an executive the amount of which is determinable based on a reporting segment of the Company achieving incremental operating income for each year from 2015-2017. During 2015 and 2016, based on operating income performance for reporting segment of the Company, approximately $0.4 million and $0.1 million of RSUs were earned. These RSUs were granted in March 2016 and March 2017, respectively, and will vest 12 months from the grant date. During 2017, the Company cancelled the 2017 performance grant. Summary of RSUs: Settlement of the RSUs shall be made in shares of the Company’s common stock by delivery of one share of common stock for each RSU then being settled. The Company calculates the fair value for RSUs based on the closing price of the Company’s stock on the date of grant and records compensation expense over the vesting period using a straight-line method. The Company factors an estimated forfeiture rate in calculating compensation expense on RSUs and adjusts for actual forfeitures upon the vesting of each tranche of RSUs. The Company also factors in the present value of the estimated dividend payments that will have accrued as these RSUs are vesting. The weighted average grant-date fair value of RSUs, including performance-based RSUs, granted during the years ended December 31, 2019, 2018, and 2017 was $40.10, $35.15, and $29.56, respectively. The total intrinsic value and fair value of RSUs vested during the years ended December 31, 2019, 2018, and 2017 was $12.5 million, $12.5 million, and $10.6 million, respectively. Performance Based Restricted Stock Unit Grants During the quarter ended June 30, 2019, the Company awarded performance restricted stock units (“PRSUs”) that are subject to service and performance vesting conditions. If defined minimum targets are met, the annual value of the PRSUs issued will be between $0.4 million and $1.4 million and vest immediately. If the defined minimum targets are not met, then no shares will be issued. The award amounts are based on the Company’s annual adjusted operating income for the fiscal years 2019, 2020 and 2021. Each fiscal year’s adjusted operating income will determine the award amount. The Company recognized compensation expense related to PRSUs of $1.4 million for the year ended December 31, 2019. A summary of the status of the Company’s non-vested RSUs and performance-based RSUs and activity for the year ended December 31, 2019 is as follows:
|  |  |  | Weighted |
|  |  |  | Average |
|  |  |  | Grant Date |
|  | Shares |  | Fair Value |
Unvested as of December 31, 2018 |  | 1,141,438 |  | $ | 30.78 |
Granted |  | 150,070 |  | $ | 40.10 |
Vested |  | (425,456) |  | $ | 29.41 |
Cancellations/expirations |  | (97,580) |  | $ | 32.72 |
Unvested as of December 31, 2019 |  | 768,472 |  | $ | 33.11 |
All RSUs vested during the year ended December 31, 2019 were issued out of treasury stock. As of December 31, 2019, there was approximately $16.5 million of total unrecognized compensation expense and approximately $30.4 million in total intrinsic value related to non-vested RSU grants. The unrecognized compensation expense will be recognized over the remaining weighted-average vesting period of 1.3 years using the straight-line method. Stock Options There were no stock options granted during 2019, 2018 or 2017. The total intrinsic value of options exercised during the years ended December 31, 2019, 2018 and 2017 was zero, $156 thousand and $194 thousand, respectively. The total fair value of stock options vested during the years ended December 31, 2019, 2018 and 2017 was zero, respectively. Cash received from option exercises under the Plans for the years ended December 31, 2019, 2018 and 2017 was zero, $0.2 million and $2.1 million, respectively. The recognized tax benefit from option exercises for the years ended December 31, 2019, 2018 and 2017 was zero, $0.0 million and $0.0 million, respectively.

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