
	Three months ended June 30,				Six months ended June 30,
	2023		2022		2023		2022
Cost of revenues	$	3,341	$	3,131	$	6,907	$	5,772
General and administrative expenses	3,210		5,305		9,035		9,700
Selling and marketing expenses	4,960		4,904		9,976		9,092
Total	$	11,511	$	13,340	$	25,918	$	24,564

Income tax benefit related to share-based compensation(1)	$	2,789	$	3,216	$	12,619	$	6,022

(1) Includes $190 and $14 during the three months ended June 30, 2023 and 2022, respectively, and $12,710 and $3,624 during the six months ended June 30, 2023 and 2022, respectively, related to discrete benefits recognized in income tax expense in accordance with ASU No. 2016-09, Compensation - Stock Compensation.

As of June 30, 2023 and December 31, 2022, the Company had 678,615 and 1,324,755 shares, respectively, available for grant under the 2018 Omnibus Incentive Plan.


	Number of Stock Options		Weighted Average Exercise Price		Aggregate Intrinsic Value		Weighted Average Remaining Contractual Life (Years)
Outstanding as of December 31, 2022	3,093		$	27.62	$	362	1.0
Granted	331,336		150.75		—		10.0
Exercised	(3,093)		27.62		384		—
Forfeited	—		—		—		—
Outstanding as of June 30, 2023	331,336		$	150.75	$	103	10.0
Vested and exercisable as of June 30, 2023	—		$	—	$	—	—
Weighted average grant date fair value of Stock options granted during the period	$	60.13

Stock options granted under the 2018 Omnibus Incentive Plan during the three and six months ended June 30, 2023, have a contractual period of ten years and vest ratably over four years.

The fair value of each stock option granted to employees is estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions:


	Three and Six months ended June 30, 2023
Dividend yield	—
Expected life (years)	6.25
Risk free interest rate for expected life	3.8	%
Volatility for expected life	32.4	%

The Company does not anticipate paying any cash dividends in the foreseeable future and therefore uses an expected dividend yield of zero in the option valuation model.

As of June 30, 2023, unrecognized compensation cost of $19,801 is expected to be expensed over a weighted average period of 4.0 years. The total grant date fair value of stock options exercised during the three and six months ended June 30, 2023 and 2022, was $30 and $nil, respectively.

Under the Company’s 2018 Omnibus Incentive Plan (the “2018 Plan”), the Company established a share matching program (“SMP”) for executive officers and other specified employees. Under the SMP, the Company agreed to issue a number of restricted stock units equal to the number of newly acquired shares of the Company's common stock.


	Restricted Stock Units (SMP)
	Number	Weighted Average Fair Value
Outstanding as of December 31, 2022	47,623	$	124.76
Granted	—	—
Vested	—	—
Forfeited	(4,177)	124.76
Outstanding as of June 30, 2023	43,446	$	124.76


	Restricted Stock Units
	Number	Weighted Average Fair Value
Outstanding as of December 31, 2022*	923,126	$	98.71
Granted	238,431	171.38
Vested	(307,060)	90.47
Forfeited	(61,323)	104.53
Outstanding as of June 30, 2023*	793,174	$	123.29

* As of June 30, 2023 and December 31, 2022 restricted stock units vested for which the underlying common stock is yet to be issued are 130,528 and 174,490 respectively.

Under the 2018 Plan, the Company grants performance-based restricted stock units (“PRSUs”) to executive officers and other specified employees. During the six months ended June 30, 2023, the Company granted 40% of each award recipient’s equity grants in the form of PRSUs that cliff vest at the end of a three-year period based on an aggregated revenue target for a three-year period (“PU”). The remaining 60% of each award recipient’s equity grants are PRSUs that are based on market conditions, contingent on the Company’s meeting a total shareholder return relative to a group of peer companies specified under the 2018 Plan, and are measured over a three-year performance period (“MU”).


	Revenue Based PRSUs			Market Condition Based PRSUs
	Number	Weighted Average Fair Value		Number	Weighted Average Fair Value
Outstanding as of December 31, 2022	49,591	$	119.99	178,712	$	134.72
Granted	43,948	172.80		65,849	223.61
Vested	—	—		—	—
Forfeited	(5,399)	127.56		(17,252)	141.19
Outstanding as of June 30, 2023	88,140	$	145.86	227,309	$	159.98

On June 21, 2022, at the annual meeting of stockholders of the Company, the Company’s stockholders approved the ExlService Holdings, Inc. 2022 Employee Stock Purchase Plan (the “2022 ESPP”).

The 2022 ESPP allows eligible employees to purchase the Company’s shares of common stock through payroll deductions at a pre-specified discount to the lower of closing price of the Company’s common shares on the date of offering or the last business day of each purchase interval. The dollar amount of shares of common stock that can be purchased under the 2022 ESPP must not exceed 15% of the participating employee’s compensation during the offering period, subject to a cap of $25 per employee per calendar year. The Company has reserved 800,000 shares of common stock for issuance over the term of the 2022 ESPP.


	Number of Shares	Total Proceeds Received
Shares available for issuance as of December 31, 2022	800,000
Issuance of common stock related to the first offering period	(7,636)	$	1,060
Shares available for issuance as of June 30, 2023	792,364
Issuance of common stock related to the second offering period made subsequent to June 30, 2023	26,099	$	3,800

The ESPP is compensatory and results in compensation expense. The fair value of common stock to be issued under the ESPP was determined using the Black-Scholes option pricing model with the following assumptions:


	Six months ended June 30, 2023
Dividend yield	—
Expected life (years)	0.5
Risk free interest rate for expected life	4.7	%
Volatility for expected life	38.9	%
Discount for illiquidity	10.3	%

The weighted average fair value of employee stock purchase rights granted pursuant to the ESPP during the six months ended June 30, 2023 was $25.86.