<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
TELETECH HOLDINGS, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
-----------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
[LOGO]
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Notice is hereby given that the Annual Meeting of Stockholders of TeleTech
Holdings, Inc., a Delaware corporation (the "Company"), will be held at the
Holtze Executive Place located at 818 17th Street, Denver, Colorado 80202 on
Friday, May 8, 1998, at 10:00 a.m., local time, for the following purposes:
(1) to elect five directors to serve until the next Annual Meeting of
Stockholders or until their successors are duly elected and qualified;
(2) to ratify the engagement of Arthur Andersen LLP as the Company's
independent auditors for 1998; and
(3) to transact such other business as may properly come before the meeting.
Stockholders of record at the close of business on March 25, 1998, are
entitled to notice of and to vote at the meeting and any postponements or
adjournments thereof. A complete list of the stockholders entitled to vote at
the meeting will be available for examination by any stockholders for any
purpose germane to the meeting (i) at the Holtze Executive Place in Denver,
Colorado, on the day of the Annual Meeting of Stockholders; and (ii) for at
least 10 days prior to the meeting at the Company's principal executive offices.
The Company's board of directors extends a cordial invitation to all
stockholders to attend the meeting.
By Order of the Board of Directors,
/S/ KENNETH D. TUCHMAN
Kenneth D. Tuchman
CHAIRMAN, PRESIDENT AND
CHIEF EXECUTIVE OFFICER
Denver, Colorado
April 13, 1998
YOUR VOTE IS IMPORTANT.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND
SIGN THE ENCLOSED PROXY AND RETURN IT AS PROMPTLY AS POSSIBLE IN THE ENCLOSED
REPLY ENVELOPE. IF YOU ATTEND THE MEETING, YOU MAY REVOKE YOUR PROXY AND VOTE IN
PERSON.
<PAGE>
TELETECH HOLDINGS, INC.
1700 LINCOLN STREET, SUITE 1400
DENVER, COLORADO 80203
------------------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
ON MAY 8, 1998
------------------------
INTRODUCTION
The accompanying proxy is solicited by the board of directors of TeleTech
Holdings, Inc., a Delaware corporation ("TeleTech" or the "Company"), for use at
the Annual Meeting of Stockholders of the Company to be held on the date, at the
time and place and for the purposes set forth in the accompanying Notice of
Annual Meeting of Stockholders and at any postponements or adjournments thereof.
The Company's principal executive offices are located at 1700 Lincoln Street,
Suite 1400, Denver, Colorado 80203, and its telephone number is (303) 894-4000.
Stockholders of record at the close of business on March 25, 1998, are entitled
to notice of and to vote at the meeting. This proxy statement and the
accompanying proxy are first being mailed to stockholders on or about April 13,
1998.
THE MEETING
VOTING AT THE MEETING
On March 25, 1998, there were 56,741,874 shares of common stock of the
Company, $.01 par value per share (the "common stock"), issued and outstanding,
and zero shares of common stock held by the Company as treasury stock. Each
share of common stock issued and outstanding on March 25, 1998, entitles the
holder thereof to one vote on all matters submitted to a vote of stockholders at
the meeting.
The presence in person or by proxy of the holders of a majority of the
outstanding shares of common stock will constitute a quorum. The affirmative
vote of a plurality of the shares represented at the meeting, in person or by
proxy, will be necessary for the election of directors. The affirmative vote of
a majority of the shares represented at the meeting, in person or by proxy, will
be necessary for (i) ratification of the engagement of Arthur Andersen LLP as
the Company's independent auditors for 1998, and (ii) the taking of all other
actions that may properly come before the meeting. Kenneth D. Tuchman, the
beneficial owner of 64.0% of the issued and outstanding shares of common stock,
has indicated his intent to vote for all nominees proposed for election to the
Company's board of directors and for each other proposal described herein to be
submitted for a vote of the stockholders.
PROXIES AND PROXY SOLICITATION
All shares of common stock represented by properly executed proxies will be
voted at the meeting in accordance with the directions marked on the proxies,
unless such proxies previously have been revoked. If no directions are indicated
on such proxies, they will be voted FOR the election of each nominee named in
this proxy statement under "Proposal 1: Election of Directors" and FOR each
other proposal described herein submitted by the board of directors for a vote
of the stockholders. If any other matters not described herein are properly
presented at the meeting for action, which is not currently anticipated, the
persons named in the enclosed proxy will vote all proxies (which confer
discretionary authority upon such holders to vote on such matters) in accordance
with their best judgment. Each stockholder who executes and returns a proxy may
revoke the proxy at any time before it is voted at the meeting by timely
1
<PAGE>
submission, to the secretary of the Company, of written notice of revocation or
a duly executed proxy bearing a later date. In addition, if a stockholder is
present at the meeting, he or she may elect to revoke his or her proxy and vote
his or her shares personally.
Proxies marked "ABSTAIN" or marked "WITHHOLD AUTHORITY" with respect to the
election of one or more directors will be treated as shares that are present for
purposes of determining the presence of a quorum but as unvoted for purposes of
determining the approval of any matter submitted for a vote of the stockholders
or as unvoted for the election of one or more directors indicated thereon,
respectively. If a broker indicates on a proxy that he or she does not have
discretionary authority to vote on a particular matter as to certain shares,
those shares will be counted for quorum purposes but will not be considered as
present and entitled to vote with respect to that matter.
The costs of soliciting proxies will be paid by the Company. Certain
directors, officers and other employees of the Company, not specially employed
for this purpose, may solicit proxies, without additional remuneration therefor,
by personal interview, mail, telephone or other means of communication. The
Company will request brokers and other fiduciaries to forward proxy soliciting
material to the beneficial owners of shares of common stock that are held of
record by such brokers and fiduciaries and will reimburse such persons for their
reasonable out-of-pocket expenses.
2
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of March 25, 1998, the ownership of
common stock by (i) each person who is known by the Company to own more than 5%
of the outstanding common stock, (ii) each director and nominee for director of
the Company, (iii) each executive officer of the Company named in the Summary
Compensation Table appearing elsewhere herein and (iv) all executive officers,
directors and nominees for director of the Company, as a group:
<TABLE>
<CAPTION>
NUMBER OF SHARES
BENEFICIALLY APPROXIMATE
NAME AND ADDRESS(1) OWNED PERCENT OF CLASS
- ---------------------------------------------------------- ----------------- -----------------
<S> <C> <C>
Kenneth D. Tuchman........................................ 36,322,400(2) 64.0%
Joseph D. Livingston...................................... 719,784(3) 1.3
Steven B. Coburn.......................................... 71,759(4) *
Rod Dammeyer.............................................. 80,309(5) *
Alan T. Silverman......................................... 369,630(6) *
Stuart M. Sloan........................................... 595,946(7) 1.1
Samuel Zell............................................... 2,114,269(8) 3.7
Morton H. Meyerson........................................ 100,000 *
John T. McLennan.......................................... -- *
All directors and executive
officers as a group (9 persons)......................... 40,374,097 69.9
The Capital Group Companies, Inc.
Capital Research and Management Company
333 South Hope Street
Los Angeles, California 90071........................... 4,850,000(9) 8.6
</TABLE>
- ------------------------
* Less than 1%.
(1) The address of each executive officer, director and nominee for director is
in care of the Company, 1700 Lincoln Street, Suite 1400, Denver, Colorado
80203.
(2) Includes (i) 106,895 shares of common stock held by the Tuchman Limited
Liability Limited Partnership, of which Mr. Tuchman is the managing general
partner; (ii) 100,000 shares owned by Kenra Family, LLP, a Colorado limited
liability partnership in which Mr. Tuchman and his spouse own direct or
indirect controlling partnership interests; and (iii) 300,000 shares owned
by the Tuchman Family Foundation, which was established for the benefit of
entities that have been granted exempt status under Section 501(c)(3) of the
Internal Revenue Code. Mr. Tuchman and his spouse are the sole directors and
officers of the Tuchman Family Foundation; however, Mr. Tuchman disclaims
beneficial ownership of all such shares. Does not include 10,000 shares of
common stock held by Mr. Tuchman's spouse, to which Mr. Tuchman disclaims
beneficial ownership.
(3) Consists of shares of common stock subject to options granted under the
TeleTech Holdings, Inc. Stock Plan (the "Option Plan") that are exercisable
as of March 25, 1998, or within 60 days thereafter (the "Measurement
Period").
(4) Includes 70,000 shares of common stock subject to options granted under the
Option Plan that are exercisable within the Measurement Period and 1,000
shares of common stock held by Mr. Coburn's spouse.
(5) Includes 31,250 shares of common stock subject to options granted under the
TeleTech Holdings, Inc. Directors' Stock Option Plan (the "Directors Option
Plan") that are exercisable within the Measurement Period.
3
<PAGE>
(6) Includes (i) 100,000 shares of common stock subject to options granted under
the Directors Option Plan that are exercisable within the Measurement
Period; (ii) 5,300 shares of common stock held by Mr. Silverman's spouse;
(iii) 6,000 shares held by two trusts (the "Trusts") established for the
benefit of Mr. Silverman's children; and (iv) 40,000 shares of common stock
contributed to the Joanna and Alan Silverman Family Foundation established
for the benefit of entities that have been granted exempt status under
Section 501(c)(3) of the Internal Revenue Code (the "Foundation"). Mr.
Silverman is trustee of the Trusts and the Foundation; however he disclaims
beneficial ownership of all such shares held.
(7) Includes 31,250 shares of common stock subject to options granted under the
Directors Option Plan that are exercisable within the Measurement Period.
(8) Includes 62,500 shares of common stock subject to options granted under the
Directors Option Plan that are exercisable within the Measurement Period;
1,751,769 shares of common stock held by Samstock, LLC ("Samstock"); and
300,000 shares of common stock held by the Samuel Zell Foundation, a
non-profit corporation. Mr. Zell is a director and the sole member of the
Samuel Zell Foundation, and is the sole director, trustee and beneficiary of
a trust that, indirectly, is the managing member of Samstock. As a result,
Mr. Zell may be deemed to be the beneficial owner of the shares of common
stock held by Samstock and the Samuel Zell Foundation; however, Mr. Zell
disclaims beneficial ownership of all such shares.
(9) The following information is derived from the Schedule 13G filed with the
Securities and Exchange Commission on February 10, 1998, jointly by The
Capital Group Companies, Inc. ("Capital Group") and Capital Research and
Management Company ("Capital Research"). Capital Group is the parent holding
company of a group of investment management companies that provide
investment advisory and management services for their clients, which include
registered investment companies and institutional accounts. The investment
management companies hold investment power and, in some cases, voting power
over securities within their portfolios. Capital Group does not have any
investment or voting power over the common stock listed on the Schedule 13G;
however, it may be deemed to beneficially own such shares pursuant to the
rules promulgated under the Securities Exchange Act of 1934 (the "Exchange
Act"). Capital Research, which is an investment adviser and a wholly owned
subsidiary of Capital Group, is the beneficial owner of 4,850,000 shares of
common stock as a result of acting as investment adviser to various
investment companies.
4
<PAGE>
PROPOSAL 1: ELECTION OF DIRECTORS
At the meeting, five persons are to be elected to the board of directors, to
hold office until the next Annual Meeting of Stockholders of the Company and
until their respective successors are duly elected and qualified. The board of
directors has nominated each of the persons named below, and it is the intention
of the persons named in the enclosed proxy to vote FOR the election of all such
nominees, each of whom has consented to serve as a director if elected. In the
event any of the nominees named below becomes unable or unwilling to serve as a
director, shares represented by valid proxies will be voted FOR the election of
such other person as the board may nominate, or the number of directors that
constitutes the full board may be reduced to eliminate the vacancy. Mr. Tuchman,
the beneficial owner of 64.0% of the issued and outstanding shares of common
stock, has indicated that he intends to vote FOR all nominees proposed for
election to the Company's board of directors.
Each of the nominees, other than John T. McLennan and Morton H. Meyerson,
currently is serving as a director of the Company. Stuart Sloan and Samuel Zell,
whose current terms as directors expire at the 1998 Annual Meeting of
Stockholders, are not standing for re-election. The Company wishes to
acknowledge and to extend its appreciation to Messrs. Sloan and Zell for their
many contributions to the Company.
INFORMATION CONCERNING THE NOMINEES FOR ELECTION AS DIRECTORS
Information concerning the five nominees proposed for election to the board
of directors is set forth below.
KENNETH D. TUCHMAN, 38, founded TeleTech and has served as the chairman of
the board of directors, president and chief executive officer of TeleTech since
its formation in December 1994. Mr. Tuchman also founded and served as the
president and chief executive officer of TeleTech Customer Care Management
(California), Inc. and TeleTech Customer Care (Colorado), Inc., the two
predecessors of TeleTech, since their formation in October 1982 and November
1992, respectively.
ROD DAMMEYER, 57, was elected as a director of TeleTech in September 1996.
Mr. Dammeyer is managing partner of Equity Group Investments, Inc., which owns,
among other things, investments in approximately 30 companies, several of which
are publicly held. Mr. Dammeyer is a director and vice-chairman of Anixter
International Inc., a provider of integrated network and cabling solutions,
where he has been employed since 1985 and previously served as president. Mr.
Dammeyer also is a director of Antec Corporation, an international
communications technology company; IMC Global Inc., a holding company whose
principal subsidiaries produce phosphate chemicals; Jacor Communications, Inc.,
an owner and operator of radio stations nationwide; Lukens, Inc., a steel
producer; CNA Surety Corp., Inc., an insurance holding company; Grupo Azucarero
Mexico, S.A. de C.V., a company that processes, refines and markets cane sugar
and non-crystallizing molasses; Metal Management, Inc., a consolidator in the
scrap metal recycling industry; Stericycle, Inc., a provider of regulated
medical waste management services; and Transmedia Network, Inc., a company that
owns and markets specialized members-only charge cards. Mr. Dammeyer also is a
trustee of Van Kampen American Capital, Inc. closed-end funds.
JOHN T. MCLENNAN, 52, is the founder and president of Jenmark Consulting,
Inc., a consulting firm specializing in the financing, management and
strategizing of technology firms primarily in communications. He served as
president and chief executive officer of Bell Canada, a Canadian local and long-
distance telephone provider, from January 1994 to October 1997. Prior thereto,
Mr. McLennan served as president of Bell Ontario, a regional subsidiary of Bell
Canada, and as chairman, president and chief executive officer of BCE Mobile
Communications, Inc., a Canadian wireless telecommunications company. Mr.
McLennan currently serves as a director of Hummingbird Communications Ltd.,
Careerbridge, Architel Systems Corporation and Mobile Data Solutions, Inc., all
software solutions development companies.
5
<PAGE>
MORTON H. MEYERSON, 60, served as chairman of Perot Systems Corporation, a
developer and provider of computer systems, from 1992 to 1997. From 1979 to
1986, he served as president and from May to December 1986, as vice chairman of
the board of Electronic Data Systems, a computer and information services
provider. Mr. Meyerson also is the founder, chairman and chief executive officer
of 2M Companies, Inc., a private investment firm, and has extensive experience
in the software industry, in running large technology companies and in investing
in, growing and capitalizing emerging technology companies. Mr. Meyerson is a
director of Crescent Real Estate Equities, Inc., a real estate investment trust,
Energy Services Company International, Inc., an offshore building company, and
Optimark Technologies, Inc., a transaction services company.
ALAN T. SILVERMAN, 54, who has served as a director of TeleTech since
January 1995, is an independent investor and, since 1992, has been a director of
Exhibition Video International, a company that is developing satellite and video
transmission technology. Mr. Silverman has served since 1970 as a director and
is president of Essaness Theatres Corporation, an investment holding company.
Mr. Silverman is a director of Keystone Biomedical, Inc., a company that
develops, tests and licenses pharmaceutical agents, and, since 1980, has been a
director of Video 44, a Hispanic television broadcasting company. Mr. Silverman
also serves as a director of various private corporations.
INFORMATION REGARDING THE BOARD OF DIRECTORS AND COMMITTEES THEREOF
Directors are elected at each Annual Meeting of Stockholders of the Company
to serve for one-year terms. During 1997, the board of directors held four
meetings and took all other actions pursuant to unanimous written consents in
lieu of meetings. Each of the current directors attended at least 75% of all
meetings of the board of directors called during the time he served as a
director and at least 75% of all meetings of each committee of the board of
directors on which he served.
The board of directors has standing Audit and Compensation Committees, which
assist the board in the discharge of its responsibilities. Members of each
committee are elected by the board at its first meeting following the Annual
Meeting of Stockholders and serve for one-year terms.
The Audit Committee reports to the board regarding the appointment of the
independent public accountants of TeleTech, the scope and fees of the
prospective annual audit and the results thereof, compliance with TeleTech's
accounting and financial policies and management's procedures and policies
relative to the adequacy of TeleTech's internal accounting controls. The current
members of the Audit Committee are Rod Dammeyer, Alan Silverman and John
McLennan (who was appointed to the committee in March 1998), each of whom is a
Non-Employee Director of the Company as defined in the Exchange Act. During
1997, the Audit Committee held four meetings and took all other actions pursuant
to unanimous written consents in lieu of meetings.
The Compensation Committee reviews performance goals and determines or
approves the annual salary and bonus for each executive officer (consistent with
the terms of any applicable employment agreement); reviews, approves and
recommends terms and conditions for all employee benefit plans (and changes
thereto); and administers the Option Plan, Directors Option Plan and the
TeleTech Holdings, Inc. Employee Stock Purchase Plan (the "Employee Purchase
Plan"), and such other employee benefit plans as may be adopted by TeleTech from
time to time. The current members of the Compensation Committee are Alan
Silverman, Stuart Sloan and John McLennan (who was appointed to the committee in
March 1998), each of whom is a non-employee director of the Company as defined
in the Exchange Act. During 1997, the Compensation Committee held four meetings
and took all other actions pursuant to unanimous written consents in lieu of
meetings. (See "Report of the Compensation Committee on Executive
Compensation.")
6
<PAGE>
COMPENSATION OF DIRECTORS
Persons serving as directors of TeleTech do not receive a fee for their
services as such; however, all directors are reimbursed for travel expenses
incurred in attending board and committee meetings. In addition, each director
who is neither an employee of the Company nor the beneficial owner of 5% or more
of the outstanding common stock is entitled to participate in the Directors
Option Plan.
The Directors Option Plan currently provides that each eligible director
automatically will be granted options to acquire (i) 12,500 shares of common
stock upon such director's initial election to the board of directors, and (ii)
on the date of each Annual Meeting of Stockholders held each year thereafter at
which such director is re-elected, 12,500 shares of common stock for services to
be rendered as a director and 6,250 for services to be rendered as a member on
each committee of the board of directors to which such director is appointed.
The exercise price of each option granted under the Directors Option Plan shall
be equal to the fair market value of the common stock on the date of grant.
Options granted under the Directors Option Plan (a) vest immediately, (b) are
not exercisable until six months after the date of grant and (c) expire on the
earliest to occur of the 10th anniversary of the date of grant, one year
following the director's death or immediately upon the director's termination of
membership on the board of directors for cause (as defined in the Directors
Option Plan). As of March 25, 1998, options to acquire an aggregate of
250,000(1) shares of common stock, at a weighted average exercise price of
$10.87 per share, were outstanding under the Directors Option Plan.
The Company entered into an employment agreement in February 1998, with
Morton Meyerson, a director of the Company, pursuant to which Mr. Meyerson has
agreed to render certain advisory and consulting services to the Company. As
compensation for such services, the Company has granted to Mr. Meyerson an
option with an exercise price of $9.50 per share, the closing sales price of the
common stock as reported by the Nasdaq National Market on the date of the
employment agreement. The option vests over five years and is subject to
accelerated vesting if and to the extent that the closing sales price of the
common stock during any 15 consecutive trading days equals or exceeds certain
target levels. Under the terms of the option, the exercise price is required to
be paid by delivery of TeleTech shares to the Company. The agreement provides
that Mr. Meyerson will receive no more than 200,000 shares of common stock, net
of shares received by the Company for exercise consideration.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's directors,
executive officers and beneficial owners of more than 10% of the outstanding
common stock (collectively, "insiders") to file reports with the Commission
disclosing their ownership of common stock and changes in such ownership. The
rules of the Commission require that the insiders provide the Company with
copies of all Section 16(a) reports filed by the insiders with the Commission.
Based solely upon the Company's review of copies of Section 16(a) reports
received by it, and written representations that no such reports were required
to be filed with the Commission, the Company believes that its insiders have
complied with all Section 16(a) filing requirements applicable to them during
1997.
- ------------------------
(1) Consists of options to acquire 225,000 shares of common stock that are held
by the 1997 directors and options to acquire 25,000 shares of common stock
granted in total to Messrs. McLennan and Meyerson upon their appointment to
the board in March 1998.
7
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Pursuant to an Amended and Restated Investment Agreement dated August 6,
1996, certain stockholders of the Company (the "Investors") are entitled, by
majority vote, to require TeleTech, at its sole expense, to register under the
Securities Act of 1933, as amended (the "Securities Act") all or part of their
common stock. In addition, if TeleTech proposes to register any of its
securities under the Securities Act, the Investors may require TeleTech, at its
sole expense, to include in such registration all or part of the approximately
6.5 million aggregate shares of common stock that currently are owned by the
Investors. Alan Silverman and Stuart Sloan, the current members of the
Compensation Committee of the board of directors, are Investors and own 218,330
and 564,696 shares of common stock, respectively, that are covered by the
agreement.
EXECUTIVE OFFICERS
The following individuals currently serve as executive officers of the
Company:
MR. TUCHMAN founded TeleTech and has served as its chairman of the board of
directors, president and chief executive officer since TeleTech's formation in
December 1994. Mr. Tuchman also founded and served as the president and chief
executive officer of TeleTech Customer Care Management (California), Inc. and
TeleTech Customer Care (Colorado), Inc., the two predecessors of TeleTech, since
their formation in October 1982 and November 1992, respectively.
MR. LIVINGSTON has served the Company since February 1992 in various
capacities, including as executive vice president and chief operating officer,
previously as senior vice president and chief operating officer, and prior
thereto as vice president of Operations and Technology. From 1989 to 1992, Mr.
Livingston was the director of MIS Systems & Operations of Livestone
Corporation, a division of American Eastern Securities; and from 1985 to 1989,
he was employed by Coopers & Lybrand LLP, an international accounting firm, as
director of West Region MIS and Strategic Management Services for International
Business.
MR. COBURN has served as vice president and chief financial officer of the
Company since October 1995. From October 1989 to September 1995, Mr. Coburn was
employed by U S West, a diversified telecommunications company, and various of
its affiliates, during which time he served as finance director and chief
financial officer of Interactive Video Enterprises, as finance director of U S
West Marketing Resources Group and as finance director and controller of U S
West Marketing Services. In 1993, Mr. Coburn established and managed the
finance, accounting and treasury activities of U S West Polska, a start-up
operation in Warsaw, Poland.
8
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION. The following table sets
forth information with respect to all compensation earned by TeleTech's chief
executive officer and TeleTech's two other most highly paid executive officers
during 1997 (collectively, the "named executive officers").
<TABLE>
<CAPTION>
OTHER ANNUAL ALL OTHER
NAME AND FISCAL SALARY BONUS COMPENSATION COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) ($) ($)(1)
- -------------------------------------------------- ------ -------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Kenneth D. Tuchman................................ 1997 $786,292 $ -- $31,509(2) $--
Chairman, President & 1996 786,292 -- 62,451(3) 10,830
Chief Executive Officer 1995 750,000 750,000 56,301(4) 10,830
Joseph D. Livingston.............................. 1997 336,501(5) 317,929(6) 15,461(7) 4,500
Executive Vice President & 1996 264,423 100,000 -- 4,500
Chief Operating Officer 1995 174,090(8) 168,743(9) -- 4,500
Steven B. Coburn.................................. 1997 160,000 80,000 -- --
Vice President and Chief 1996 129,691 75,000 -- --
Financial Officer 1995 28,000(10) -- -- --
</TABLE>
- ------------------------
(1) Represents the full dollar value of premiums paid by the Company with
respect to life insurance for the benefit of Mr. Tuchman, Mr. Livingston and
their respective beneficiaries.
(2) Includes $27,460 paid as a car allowance and $4,049 in aggregate club
memberships.
(3) Includes $27,500 of rental payments on a condominium; $19,400 paid as a car
allowance; and other perquisites paid by the Company to or on behalf of Mr.
Tuchman.
(4) Includes $20,000 in aggregate club membership dues and initiation fees;
$17,500 paid as a car allowance; $15,600 for lease of a townhouse; and other
perquisites paid by the Company to or on behalf of Mr. Tuchman.
(5) Includes $31,355 paid to Mr. Livingston for accrued but unused vacation
time.
(6) Includes a $150,000 annual performance bonus and $167,929 of commissions for
Mr. Livingston's assistance in obtaining a client contract.
(7) Represents a car allowance paid to Mr. Livingston.
(8) Includes approximately $11,340 paid to Mr. Livingston for accrued but unused
vacation time.
(9) Includes a $75,000 annual performance bonus and an approximately $93,700
one-time bonus for Mr. Livingston's assistance in obtaining a client
contract.
(10) Mr. Coburn joined TeleTech in October 1995 at an annual base salary of
$120,000.
9
<PAGE>
OPTION GRANTS. None of the named executive officers was granted options
during 1997.
OPTION HOLDINGS. The following table sets forth information with respect to
the aggregate number and value of (i) shares issued pursuant to options
exercised during 1997, and (ii) shares underlying unexercised options held as of
December 31, 1997, by each of the named executive officers.
AGGREGATE OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SHARES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AS OF DECEMBER 31, AS OF DECEMBER 31,
SHARES VALUE 1997(#) 1997($)(1)
ACQUIRED ON REALIZED -------------------------- ---------------------------
NAME EXERCISE (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------ ------------- ----------- ----------- ------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Kenneth D. Tuchman............ -- -- -- -- -- --
Joseph D. Livingston.......... -- -- 709,367 33,333 $ 6,893,000 $ 113,000
Steven B. Coburn.............. 30,000 $ 697,500 70,000 150,000 657,000 1,407,000
</TABLE>
- ------------------------
(1) The value of each option is based on the last reported sales price of the
common stock on December 31, 1997, as reported on the Nasdaq National
Market, less the exercise price payable for such shares.
EMPLOYMENT AGREEMENTS
AGREEMENT WITH KENNETH D. TUCHMAN. TeleTech has entered into an employment
agreement with Kenneth D. Tuchman as chairman of the board, president and chief
executive officer of TeleTech for a term commencing on January 1, 1998, and
ending on December 31, 2000 (the "Term"). Pursuant to the employment agreement,
Mr. Tuchman is entitled to receive an annual base salary of $786,292, as
adjusted on January 1 of each year during the Term by the annual percentage
increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers
for the Denver metropolitan area (the "CPI Percentage"). The agreement provides
that if Mr. Tuchman elects to forego a CPI Percentage-based adjustment for any
year, as he has in 1997 and 1998, he will be entitled to have his annual base
salary increased by an amount equal to the amount by which his annual base
salary would have been increased had he not elected to forego such adjustments.
Any such increase would be applied prospectively beginning on any subsequent
adjustment date that Mr. Tuchman selects. Mr. Tuchman also is eligible to
receive an annual performance bonus of up to $250,000, as adjusted annually by
the CPI Percentage, if TeleTech achieves certain predetermined performance goals
established each year by the Compensation Committee. The agreement requires the
Company to maintain, on behalf of Mr. Tuchman, a $24 million life insurance
policy (half of which is payable to his beneficiaries); disability insurance;
accident, death and dismemberment insurance; and errors and omissions insurance
with a policy limit of not less than $1 million. Mr. Tuchman also is entitled to
receive certain perquisites specified therein.
The agreement prohibits Mr. Tuchman, during his employment and for three
years thereafter, from disclosing any confidential information or trade secrets
of TeleTech. Mr. Tuchman also is prohibited, during his employment and for three
years after the Company terminates his employment for good cause (as defined
therein) or Mr. Tuchman voluntarily terminates his employment with the Company,
from engaging in any business, or becoming employed by or otherwise rendering
services to any company (other than TeleTech) that has as its primary business
inbound or outbound teleservices. The agreement provides that if TeleTech
terminates Mr. Tuchman's employment for good cause, TeleTech will pay Mr.
Tuchman his salary as accrued through the date of termination. If TeleTech
terminates Mr. Tuchman's employment without good cause, TeleTech will pay to him
the lesser of (i) the sum of his salary as accrued through the date of
termination, his performance bonus, prorated for any portion of the year
remaining and calculated as if TeleTech had achieved its performance goals, and
the present value of all payments that otherwise would have been made to him
during the remainder of the Term, calculated as if TeleTech had achieved its
10
<PAGE>
performance goals; or (ii) three times the aggregate salary and performance
bonus earned by him in the immediately preceding year.
AGREEMENT WITH JOSEPH D. LIVINGSTON. TeleTech is party to an employment
agreement with Joseph D. Livingston, who serves as executive vice president and
chief operating officer of TeleTech, which agreement was effective January 1,
1995, and amended in May 1996. Pursuant to the agreement, Mr. Livingston is
entitled to receive an annual base salary and is eligible to receive an annual
performance bonus based upon TeleTech's achievement of certain predetermined
performance goals. In recognition of Mr. Livingston's efforts in developing and
maintaining key client relationships, Mr. Livingston's annual base salary for
1998 has been increased to $380,000 and he was granted a $150,000 performance
bonus for 1997. The Company and Mr. Livingston intend to amend the employment
agreement to reflect Mr. Livingston's modified compensation. Mr. Livingston's
employment with TeleTech is terminable at any time by either party, with or
without cause. Upon termination of employment, Mr. Livingston will be entitled
to unpaid compensation for services rendered together with employee benefits
accrued through the date of termination. The agreement prohibits Mr. Livingston
from disclosing any confidential information or trade secrets of TeleTech and,
for three years after termination of his employment with TeleTech, from engaging
in any business or becoming employed or otherwise rendering services to any
company engaging in inbound or outbound teleservices, development or maintenance
of voice or data communication, certain software applications, customer
communications services, or technological innovation or support for any of the
foregoing.
AGREEMENT WITH STEVEN B. COBURN. The Company is party to a three-year
employment agreement with Steven B. Coburn, who serves as vice president and
chief financial officer of the Company. Pursuant to the October 2, 1995,
agreement, Mr. Coburn is entitled to receive an annual base salary and also is
eligible to receive an annual performance bonus of not more than 25% of his
salary upon the Company's achievement of certain predetermined performance
goals. In recognition of Mr. Coburn's expanded responsibilities and his efforts
in developing relationships with several significant new clients, Mr. Coburn's
annual base salary for 1998 has been increased to $200,000 and he was granted a
performance bonus for 1997 of $80,000. The Company and Mr. Coburn intend to
amend Mr. Coburn's employment agreement to reflect his modified compensation.
The agreement prohibits Mr. Coburn from disclosing any confidential information
or trade secrets of the Company. Mr. Coburn also is prohibited, during his
employment and for three years after the Company terminates his employment for
good cause (as defined therein) or Mr. Coburn voluntarily terminates his
employment with the Company, from engaging in any business, or becoming employed
by or otherwise rendering services to any company (other than TeleTech), that
has as its primary business inbound or outbound teleservices or technological
innovation or support with respect thereto.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Certain information with respect to Messrs. Silverman and Sloan is set forth
under the caption "Proposal 1: Election of Directors--Compensation Committee
Interlocks and Insider Participation."
During 1997, TeleTech purchased insurance coverage from a wholly owned
subsidiary of EGI Risk Services, Inc. (formerly known as The Riverside Agency,
Inc.) and retained EGI Risk Services to review and obtain insurance policies
from other third parties. EGI Risk Services is a wholly owned subsidiary of
Equity Group Investments, Inc., which is an affiliate of Samuel Zell, a TeleTech
director. TeleTech paid EGI Risk Services an aggregate of $1,166,000 in 1997, of
which approximately $900,000 represents payments for insurance premiums and loss
claims and approximately $270,000 represents payment for administrative and
brokerage services rendered by EGI Risk Services. The Company expects to make
equivalent payments to EGI Risk Services during 1998.
TeleTech received an aggregate of $841,000 in reservation call handling
service fees from Midway Airlines Corporation ("Midway") during 1997. TeleTech's
agreement with Midway expired in December
11
<PAGE>
1997. Prior to Midway's initial public offering in December 1997, Zell/Chilmark
Fund, L.P. ("Zell/ Chilmark") was a significant stockholder of Midway. Samuel
Zell and Rod Dammeyer, each of whom is a director of TeleTech, is an affiliate
and the managing director, respectively, of Zell/Chilmark.
During 1997, TeleTech paid approximately $1.9 million to Pro-Net Solutions,
Inc. for computer hardware, software and other related equipment and supplies
purchased by TeleTech. Pro-Net Solutions, Inc. is owned by a trust established
for the benefit of Matthew Zell, who is Samuel Zell's son. The Company may
purchase an equivalent amount of computer-related equipment from Pro-Net
Solutions during 1998.
The Company has entered into an employment agreement with Morton Meyerson, a
director of the Company, pursuant to which Mr. Meyerson has agreed to render
certain advisory and consulting services to the Company. (See "Proposal 1:
Election of Directors--Compensation of Directors.")
TeleTech believes that all transactions disclosed above have been, and
TeleTech's board of directors intends that any future transactions with its
officers, directors, affiliates or principal stockholders will be, on terms that
are no less favorable to TeleTech than those that are obtainable in arm's length
transactions with unaffiliated third parties.
12
<PAGE>
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE COMPANY'S
PREVIOUS FILINGS UNDER THE SECURITIES ACT OR THE EXCHANGE ACT THAT MIGHT
INCORPORATE FUTURE FILINGS, INCLUDING THIS PROXY STATEMENT, IN WHOLE OR IN PART,
THE REPORT PRESENTED BELOW AND THE PERFORMANCE GRAPH FOLLOWING THE REPORT SHALL
NOT BE INCORPORATED BY REFERENCE INTO ANY SUCH FILINGS.
REPORT OF THE COMPENSATION
COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee of the board of directors of the Company (the
"Compensation Committee") is responsible for approving and overseeing the
Company's compensation policy, approving salaries and annual bonuses for
executive management of the Company, including the named executive officers, and
administering the Stock Option Plan, the Directors Option Plan and the Employee
Purchase Plan. The Compensation Committee fulfills its responsibilities with
significant input from the Company's chief executive officer and other members
of senior management. As required by the Stock Option Plan, during 1997 the
Compensation Committee was composed of two "Non-Employee Directors," as defined
in the Exchange Act.
COMPENSATION POLICY. The Company's compensation policy for executive
management is designed to recruit, motivate and retain highly qualified
individuals by (i) rewarding individual achievement, (ii) enabling individuals
to share in the risks and rewards of the Company's overall performance and (iii)
paying compensation that is competitive with industry compensation levels. In
establishing its compensation policy, the Company implemented certain
recommendations made by an independent compensation consulting firm retained by
the Company. The key components of the Company's current compensation policy,
which is designed to balance short-term and long-term considerations, are
competitive salaries, annual cash performance bonuses and long-term equity
incentives. With respect to 1997 compensation, the Compensation Committee did
not use a specific formula to evaluate performance, determine the specific
amount of compensation payable to any individual or allocate each individual's
total compensation among salary, bonus and stock options; however, the
Compensation Committee believes that the compensation paid by the Company to its
executive management is commensurate with the services they rendered to the
Company.
ANNUAL SALARIES. Kenneth D. Tuchman, the chairman of the board and
president and chief executive officer of the Company, has authority to hire all
members of executive management of the Company, subject to the Compensation
Committee's approval of the compensation to be paid to such executives. Subject
to the approval of the Compensation Committee, Mr. Tuchman also determines the
compensation payable to persons offered executive-level employment with the
Company and annual salary increases for members of the Company's executive
management. The Compensation Committee determines annual adjustments to Mr.
Tuchman's salary and bonus compensation, which is subject to the terms of Mr.
Tuchman's employment agreement. In determining and approving the amount of
annual salary and salary increases for executive management, Mr. Tuchman and the
Compensation Committee consider factors such as the executive's contribution to
the Company's overall operating effectiveness, strategic success and
profitability; the executive's role in developing and maintaining key client
relationships; the level of responsibility, scope and complexity of such
executive's position relative to other executive management; and the executive's
leadership growth and management development over the past year.
The salaries of the named executive officers, which are listed in the
Summary Compensation Table located elsewhere in this proxy statement, are
governed by written employment agreements with the Company; however, the
salaries of Messrs. Livingston and Coburn for 1998 were increased above the
levels set forth in their respective agreements. Both Messrs. Livingston and
Coburn have been instrumental in the Company's obtaining contracts and
developing relationships with several significant new clients. The Company
believes that developing and maintaining relationships with its clients is and
will continue to be a critical driver of the Company's future growth. The salary
increases approved by Mr. Tuchman and the Compensation Committee were in
recognition of Mr. Livingston's and Mr. Coburn's respective efforts in
13
<PAGE>
developing and maintaining key client relationships. The Company intends to
amend Mr. Livingston's and Mr. Coburn's employment agreements to reflect their
modified compensation. (See "Employment Agreements--Agreement with Joseph D.
Livingston" and "Employment Agreements--Agreement with Steven B. Coburn.")
PERFORMANCE BONUSES. Cash performance bonuses are determined and approved
annually by the Compensation Committee based on a subjective evaluation of each
executive's actual performance relative to predetermined performance goals,
which are based upon factors over which each executive has significant control.
The performance goals for executives who are responsible for a particular
strategic business unit or functional department, for example, generally are
based upon target gross revenues or net income for such strategic business unit
or functional department. For other executives, performance goals may take into
account the extent to which predetermined strategic goals and business plans are
met and whether special projects and tasks undertaken by the executive during
the preceding year have been successfully completed. In addition, the
Compensation Committee generally considers the Company's overall financial
performance, including the achievement of target gross revenues and net income
goals. Each of Mr. Livingston and Mr. Coburn was granted a bonus for 1997 that
is above the bonus level set forth in their respective agreements. The bonuses
were granted in recognition of their efforts in obtaining contracts and
developing relationships with several significant new clients.
LONG-TERM INCENTIVES. Stock-based compensation also is an important element
of the Company's compensation policy. Stock options and, to a lesser extent,
restricted shares of common stock generally are offered to induce an executive
to accept employment with the Company. The Compensation Committee believes that
stock options and restricted stock, which vest over time and are subject to
forfeiture, align the interests of executive management with the interests of
the Company's stockholders. The Compensation Committee also believes that
substantial equity ownership by individuals in leadership positions within the
Company ensure that such individuals will remain focused on building stockholder
value. Mr. Tuchman generally recommends, for approval by the Compensation
Committee, the size, vesting schedule and other key elements of a particular
stock option grant based upon his subjective assessment of the same factors that
are considered in determining and approving annual salaries and salary
increases.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER. The compensation paid to
Kenneth D. Tuchman, the Company's chairman of the board of directors, president
and chief executive officer, is governed in substantial part by his employment
agreement. (See "Executive Officers--Employment Agreements.") Pursuant to his
employment agreement, Mr. Tuchman is entitled to receive an annual base salary
of $786,292 and also is eligible to receive an annual performance bonus of up to
$250,000 if TeleTech achieves certain predetermined performance goals
established each year by the Compensation Committee, in each case as adjusted
annually based on a specified consumer price index. Each year, the Compensation
Committee is required to (i) review Mr. Tuchman's performance during the
immediately preceding fiscal year and determine the amount of bonus
compensation, if any, to which he is entitled, (ii) review and approve
adjustments to Mr. Tuchman's annual salary and bonus and (iii) determine the
performance objectives upon which Mr. Tuchman's bonus compensation for the next
fiscal year will be based. Mr. Tuchman's bonus compensation for fiscal 1997 was
dependent upon the Company's achievement of specified revenue and profitability
targets and certain client business and internal management development goals.
Although the Company achieved record revenue growth in 1997, the Company's
profitability and business development initiatives were adversely affected by
(i) substantial reductions in call volumes of two significant client programs,
which reductions were effected in the third and fourth quarter of 1997, and (ii)
the Company's continued efforts to build its infrastructure and expand its
executive management team. As a result, the Company achieved some but not all of
the performance objectives upon which Mr. Tuchman's 1997 bonus compensation was
based. Mr. Tuchman elected to forego any bonus compensation to which he may have
been entitled for 1997. In addition, Mr. Tuchman elected to forego a salary
increase for 1998 and to remain at his 1997 base salary of $786,292.
14
<PAGE>
LIMITATIONS ON THE DEDUCTIBILITY OF COMPENSATION. Provisions of the
Internal Revenue Code of 1986, as amended (the "Code"), disallow the
deductibility of certain compensation in excess of $1 million paid to a public
company's chief executive officer and certain other highly paid executive
officers. The deductibility limitation does not apply to performance-based
compensation, as defined in the Code, provided certain stockholder approval and
other requirements are met. The Compensation Committee anticipates that the
Company's compensation policy for executive officers will continue to consist
primarily of performance-based compensation and also will be designed to satisfy
the requirements of Section 162(m). However, due to the ambiguities and
uncertainties regarding the application and interpretation of Section 162(m),
there can be no assurance that any performance bonus paid to Mr. Tuchman will
satisfy the requirements for deductibility.
March 26, 1998
SUBMITTED BY THE 1997 COMPENSATION
COMMITTEE OF THE BOARD OF DIRECTORS
Alan T. Silverman
Stuart M. Sloan
15
<PAGE>
PERFORMANCE GRAPH
The graph below compares the cumulative total stockholder return on the
common stock since consummation of the Company's initial public offering in
August 1996 with the cumulative total return of the Nasdaq Total Return Index
(US); the Nasdaq Total Return for Nasdaq Non-Financial Stocks over the same
period (assuming the investment on August 1, 1996, of $100 in each of common
stock, the Nasdaq Total Return Index (US) and the Nasdaq Total Return for Nasdaq
Non-Financial Stocks); and a group of peer companies. The group of peer
companies is composed of APAC Teleservices, Precision Response Corporation,
Sitel Corporation, Sykes Enterprises Inc. and Telespectrum Worldwide Inc. The
Company does not believe that the stock price performance shown on the graph
below is necessarily indicative of future price performance.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DOLLARS TELETECH HOLDINGS, INC. PEER GROUP NASDAQ STOCK MARKET (U.S.) NASDAQ NON-FINANCIAL
<S> <C> <C> <C> <C>
8/01/96 100 100 100 100
12/96 179 109 119 118
12/97 78 50 146 139
</TABLE>
16
<PAGE>
PROPOSAL 2: RATIFICATION OF ENGAGEMENT OF AUDITORS
The Company has engaged Arthur Andersen LLP to audit the Company's financial
statements for fiscal 1998. Arthur Andersen LLP audited the Company's financial
statements for fiscal 1997 and the decision to retain Arthur Andersen LLP has
been approved by the Audit Committee. The board of directors recommends that the
stockholders vote FOR ratification of the engagement of Arthur Andersen LLP.
A representative of Arthur Andersen LLP is expected to attend the Annual
Meeting of Stockholders and will have the opportunity to make a statement, if he
or she so desires, and will be available to respond to appropriate questions of
stockholders.
GENERAL INFORMATION
1999 ANNUAL MEETING OF STOCKHOLDERS
Any proposals of stockholders that are intended for inclusion in the
Company's proxy statement and form of proxy for its 1999 Annual Meeting of
Stockholders must be received by the secretary of the Company no later than
December 14, 1998. Stockholder proposals must be in writing and delivered to the
Company's principal executive offices at 1700 Lincoln Street, Suite 1400,
Denver, Colorado, 80203.
ANNUAL REPORTS
The Company's 1997 Annual Report to Stockholders is being mailed to the
stockholders together with this proxy statement; however, the report is not part
of the proxy solicitation materials. A copy of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997 (excluding exhibits), as filed
with the Commission, may be obtained without charge upon request made to
TeleTech Holdings, Inc., 1700 Lincoln Street, Suite 1400, Denver, Colorado,
80203, Attention: Director of Investor Relations.
17
<PAGE>
PROXY PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
TELETECH HOLDINGS, INC.
The undersigned, having received Notice of Annual Meeting and Proxy
Statement, hereby appoints KENNETH D. TUCHMAN and STEVEN B. COBURN, and each
of them, proxies with full power of substitution, for and in the name of the
undersigned, to vote all shares of Common Stock of TELETECH HOLDINGS, INC.
owned of record by the undersigned at the 1998 Annual Meeting of Stockholders
to be held at Holtze Executive Place, located at 818 17th Street, Denver,
Colorado 80202, on May 8, 1998, at 10:00 a.m., local time, 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 or
his sole 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 or his sole discretion are further
authorized to vote on other matters which may properly come before the 1998
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 YOUR SHARES UNLESS YOU SIGN AND RETURN THIS CARD.
(PLEASE SIGN ON OTHER SIDE)
<PAGE>
PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!
ANNUAL MEETING OF STOCKHOLDERS
TELETECH HOLDINGS, INC.
MAY 8, 1998
PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED
- -------------------------------------------------------------------------------
A / / PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE USING DARK
INK ONLY.
<TABLE>
<CAPTION>
FOR ALL NOMINEES
(except as indicated WITHHOLD AUTHORITY THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL
below) to vote for all nominees NOMINEES AND FOR PROPOSAL 2.
<S> <C> <C> <C>
1. Election of Directors: / / / / NOMINEES: KENNETH D. TUCHMAN
ROD DAMMEYER
(Instruction: To withhold authority to vote for an individual JOHN T. MCLENNAN
nominee, strike a line through the nominee's name at right) MORTON H. MEYERSON
ALAN T. SILVERMAN
</TABLE>
- -------------------------------------------------
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
<S> <C> <C> <C>
2. Ratification of the appointment of Arthur
Andersen LLP as the Company's independent / / / / / /
auditors.
Do you plan to attend the Annual Meeting ? / / / /
yes no
</TABLE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR" ALL OF THE
BOARD OF DIRECTORS' NOMINEES AND "FOR" PROPOSAL 2.
SIGNATURE(S) DATE
--------------------------------------------------- -------
NOTE: Please sign exactly as name appears hereon. Joint owners should each
sign. When signing as attorney, executor, administrator, trustee or guardian,
please give full title as such.
- -------------------------------------------------------------------------------
