Avon 2015 Annual Report Download - page 113

The methods and assumptions used to estimate fair value are as follows:
Available-for-sale securities — The fair values of these investments were the quoted market prices for issues listed on securities exchanges.
Debt maturing within one year and long-term debt — The fair values of our debt and other financing were determined using Level 2 inputs
based on indicative market prices.
Foreign exchange forward contracts — The fair values of forward contracts were estimated based on quoted forward foreign exchange
prices at the reporting date.
NOTE 10. Share-Based Compensation Plans
The Avon Products, Inc. 2010 Stock Incentive Plan (the “2010 Plan”) and the Avon Products, Inc. 2013 Stock Incentive Plan, as amended and
restated (the “2013 Plan”), which are shareholder approved plans, provide for several types of share-based incentive compensation awards
including stock options, stock appreciation rights, restricted stock, restricted stock units and performance restricted stock units. Following
shareholder approval of the 2013 Plan in May 2013, there were no further awards made under the 2010 Plan. Under the 2010 Plan, the
maximum number of shares that may be awarded was 32,000,000 shares, where the maximum number of shares was reduced as follows:
(i) in the case of the grant of an award of an option or Stock Appreciation Right (“SAR”), by each share of stock subject to such an award
and (ii) in the case of the grant of an award payable in stock other than an option or SAR by 2.33 multiplied by each share of stock subject
to such award. Under the 2013 Plan, the maximum number of shares that may be awarded is 55,000,000 shares, where the maximum
number of shares are reduced as follows: (i) in the case of the grant of an award of an option or SAR, by each share subject to such an
award and (ii) in the case of the grant of an award payable in shares other than an option or SAR by 3.13 multiplied by each share subject to
such an award. Shares issued under share-based awards will be primarily funded with issuance of new shares.
We have issued stock options and stock appreciation rights under the 2010 Plan, and restricted stock units and performance restricted stock
units under both the 2010 Plan and the 2013 Plan. Stock option awards are granted with an exercise price equal to the closing market price
of our stock at the date of grant. Those option awards and stock appreciation rights generally vest in thirds over the three-year period
following each option grant date and have ten-year contractual terms. Restricted stock units granted to Associates generally vest and settle
after three years. Restricted stock units awarded to non-management directors vest in approximately one year and settle upon a director’s
departure from the Board of Directors. Performance restricted stock units generally vest after three years only upon the satisfaction of certain
performance conditions.
For the years ended December 31:
2015 2014 2013
Compensation cost for stock options, stock appreciation rights, performance
restricted stock units and restricted stock units $51.2 $38.9 $43.3
Total income tax benefit recognized for share-based arrangements 4.1 3.2 14.9
All of the compensation cost for stock options, stock appreciation rights, performance restricted stock units and restricted stock units,
including those that will be funded with treasury shares and those that have not resulted in a fair value measurement date, for 2015, 2014
and 2013 was recorded in selling, general and administrative expenses in the Consolidated Statements of Operations.
A V O N 2015 F-31
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