Assurant 2015 Annual Report Download - page 135

ASSURANT, INC. – 2015 Form 10-K F-49
17 Stock Based Compensation
For awards granted during the year ended December 31,
2015 2014 2013
Expected volatility 19�06% 24�66% 26�76%
Expected term (years) 2�81 2�80 2�80
Risk free interest rate 0�99% 0�66% 0�39%
Long-Term Incentive Plan
Prior to the approval of the ALTEIP, share based awards were
granted under the 2004 Assurant Long-Term Incentive Plan
(“ALTIP”), which authorized the granting of up to 10,000,000
new shares of the Company’s common stock to employees and
ofcers under the ALTIP, Business Value Rights Program and
CEO Equity Grants Program. Under the ALTIP, the Company
was authorized to grant restricted stock and SARs� Since
May 2008, no new grants have been made under this plan
and the impact of these grants on the consolidated nancial
statements is immaterial�
Employee Stock Purchase Plan
Under the Employee Stock Purchase Plan (“ESPP”), the
Company is authorized to issue up to 5,000,000 new shares
to employees who are participants in the ESPP� The ESPP
allows eligible employees to contribute, through payroll
deductions, portions of their after-tax compensation in
each offering period toward the purchase of shares of the
Company’s common stock� There are two offering periods
during the year (January 1 through June 30 and July 1 through
December 31) and shares are purchased at the end of each
offering period at 90% of the lower of the closing price of
the common stock on the rst or last day of the offering
period� Participants’ contributions are limited to a maximum
contribution of $7.5 per offering period, or $15 per year.
The ESPP is offered to individuals who are scheduled to work
at least 20 hours per week and at least ve months per year,
have been continuously employed for at least six months by
the start of the offering period, are not temporary employees
(employed less than 12 months), and have not been on a leave
of absence for more than 90 days immediately preceding
the offering period� Participants must be employed on the
last trading day of the offering period in order to purchase
Company shares under the ESPP� The maximum number of
shares that can be purchased each offering period is 5,000
shares per employee�
In January 2016, the Company issued 59,102 shares at a
discounted price of $61.70 for the offering period of July 1,
2015 through December 31, 2015. In January 2015, the Company
issued 65,302 shares at a discounted price of $59.65 for the
offering period of July 1, 2014 through December 31, 2014.
In July 2015, the Company issued 65,320 shares to employees at
a discounted price of $60.30 for the offering period of January 1,
2015 through June 30, 2015. In July 2014, the Company issued
65,867 shares to employees at a discounted price of $58.79 for
the offering period of January 1, 2014 through June 30, 2014.
The compensation expense recorded related to the ESPP was
$1,277, $1,201 and $1,098 for the years ended December 31,
2015, 2014 and 2013, respectively. The related income tax
benet for disqualied disposition was $186, $147 and $208 for
the years ended December 31, 2015, 2014 and 2013, respectively.
The fair value of each award under the ESPP was estimated at
the beginning of each offering period using the Black-Scholes
option-pricing model and assumptions in the table below�
Expected volatilities are based on implied volatilities from
traded options on the Company’s stock and the historical
volatility of the Company’s stock� The risk-free rate for
periods within the contractual life of the option is based on
the U�S� Treasury yield curve in effect at the time of grant�
The dividend yield is based on the current annualized dividend
and share price as of the grant date�
For awards issued during the year ended December 31,
2015
2014 2013
Expected volatility 16�79-17�67% 19�02-20�65 % 18�30-25�40 %
Risk free interest rates 0�06-0�11 % 0�09% 0�08-0�15 %
Dividend yield 1�58-1�62 % 1�52-1�92 % 2�34-2�38 %
Expected term (years) 0�5 0�5 0�5
Non-Stock Based Incentive Plans
Deferred Compensation
The deferred compensation programs consist of the AIP, the
ASIC and the ADC Plans. The AIP and ASIC Plans provided
key employees the ability to exchange a portion of their
compensation for options to purchase certain third-party
mutual funds� The AIP and ASIC Plans were frozen in
December 2004 and no additional contributions can be made
to either Plan. Effective March 1, 2005 and amended and
restated on January 1, 2008, the ADC Plan was established in
order to comply with the American Jobs Creation Act of 2004
(“Jobs Act”) and IRC Section 409A. The ADC Plan provides
key employees the ability to defer a portion of their eligible
compensation to be notionally invested in a variety of mutual
funds. Deferrals and withdrawals under the ADC Plan are
intended to be fully compliant with the Jobs Act denition
of eligible compensation and distribution requirements.