11.Stock Based Compensation Plans and Other Benefit Plans

The Company has options outstanding under four equity compensation plans. Under the Amended and Restated Omnibus Equity Plan, the Company may grant options and other stock-based awards to employees and directors. Under the 1983 Stock Option Plan and the Stock Award Plan, the Company granted options to key management employees. Under the Stock Option Plan for Directors, the Company granted options to non‑employee directors. Following adoption of the original Omnibus Equity Plan by stockholders in 2008, no further grants were permitted under the other equity compensation plans. Options outstanding under the plans are issued at market value on the date of grant, vest on the third anniversary of the date of grant and must be exercised within ten years of the date of grant. If, upon termination of a participant’s employment (other than a termination for cause), a participant is at least 55 years old, has at least five years of service, and the sum of the participant’s age and years of service is at least 65, the participant may exercise any stock options granted in 2007 or later within a period of three years from the date of termination or, if earlier, the date such stock options otherwise would have expired, subject to specified conditions. Issuances of Common Stock to satisfy employee option exercises currently are made from treasury stock.

Stock option transactions for the three years ended December 31, 2016 were as follows:

						Weighted
				Weighted		Average
				Average		Remaining		Aggregate
				Exercise		Contractual		Intrinsic
	Options			Price		Term		Value
Outstanding as of December 31, 2013		17.5		$	19.74
Granted		2.3			34.81
Exercised		(2.6	)		12.57
Cancelled		(0.2	)		28.16
Outstanding as of December 31, 2014		17.0		$	22.75
Granted		2.2			41.91
Exercised		(1.8	)		15.56
Cancelled		(0.2	)		30.95
Outstanding as of December 31, 2015		17.2		$	25.89
Granted		2.1			46.75
Exercised		(3.0	)		16.96
Cancelled		(0.3	)		39.60
Outstanding as of December 31, 2016		16.0		$	30.06		5.8	$	233.5
Exercisable as of December 31, 2016		9.7		$	22.91		4.3	$	207.0

The following table summarizes information relating to options outstanding and exercisable as of December 31, 2016:

	Options Outstanding						Options Exercisable
			Weighted		Weighted				Weighted
	Outstanding		Average		Average		Exercisable		Average
Range of	as of		Remaining		Exercise		as of		Exercise
Exercise Prices	12/31/2016		Contractual Life		Price		12/31/2016		Price
$10.01 - $15.00		2.2		1.8	$	13.58		2.2	$	13.58
$15.01 - $20.00		1.2		3.4	$	16.68		1.2	$	16.68
$20.01 - $25.00		1.4		4.3	$	20.32		1.4	$	20.32
$25.01 - $30.00		2.3		5.2	$	26.91		2.3	$	26.91
$30.01 - $35.00		4.8		6.4	$	32.65		2.6	$	30.98
$40.01 - $45.00		2.8		8.4	$	41.88		0.0	$	0.00
$45.01 - $50.00		1.3		9.4	$	49.36		0.0	$	0.00
		16.0		5.8	$	30.06		9.7	$	22.91

The table above represents the Company’s estimate of options fully vested and expected to vest. Expected forfeitures are not material and, therefore, are not reflected in the table above.

The following table provides information regarding the intrinsic value of stock options exercised and stock compensation expense related to stock option awards:

	2016		2015		2014
Intrinsic Value of Stock Options Exercised	$	91.5	$	49.0	$	58.0
Stock Compensation Expense Related to Stock Option Awards	$	14.4	$	14.8	$	15.2
Issued Stock Options		2.1		2.2		2.3
Weighted Average Fair Value of Stock Options issued (per share)	$	7.57	$	6.85	$	6.41
Fair Value of Stock Options Issued	$	16.1	$	15.3	$	15.0

The following table provides a summary of the assumptions used in the valuation of issued stock options:

	2016			2015			2014
Risk-free interest rate		1.7	%		2.0	%		2.0	%
Expected life in years		6.8			6.3			6.2
Expected volatility		17.0	%		17.2	%		20.4	%
Dividend yield		1.5	%		1.6	%		1.8	%

The fair value of stock options is based upon the Black Scholes option pricing model. The Company determined the stock options’ lives based on historical exercise behavior and their expected volatility and dividend yield based on the historical changes in stock price and dividend payments. The risk free interest rate is based on the yield of an applicable term Treasury instrument.

As of December 31, 2016, there was a fair value of $8.9 related to unamortized stock option compensation expense, which is expected to be recognized over the next three years. The Company’s Consolidated Statements of Cash Flow reflect an add back to Net Cash Provided by Operating Activities of $16.0, $16.1 and $17.0 in 2016, 2015 and 2014, respectively, for non-cash compensation expense, primarily stock option expense. Cash flow from Financing Activities includes $30.0, $15.8 and $18.5 in 2016, 2015 and 2014, respectively, of excess tax benefits on stock options exercised. The total tax benefit for 2016, 2015 and 2014 was $30.0, $15.8 and $18.8, respectively.

Other Benefit Plans

International Pension Plan Terminations

In 2016 the Company authorized the termination of international defined benefit pension plans under which approximately 336 participants, including 53 active employees, have accrued benefits. The Company anticipates completing the termination of this plan by the end of the second quarter of 2017, once regulatory approvals are obtained. In addition to plan assets, the Company will need to make a one-time payment of $20.0 to $26.0 ($14.0 to $19.0 after tax) to purchase annuities for participants. The Company estimates that it will incur a one-time expense of $49.0 to $55.0 ($40.0 to $45.0 after tax) in 2017 when the plan settlement is completed. This expense primarily includes the effect of the additional cash payment required at settlement and pension settlement accounting rules which require accelerated recognition of actuarial losses that were to be amortized over the expected benefit lives of participants. The estimated expense is subject to change based on valuations at the actual date of settlement. Upon the termination of these plans in 2017, the Company will have no further obligations with respect to material defined benefit pension plans.

On December 31, 2014, the Company terminated an international defined benefit pension plan under which approximately 270 participants, including approximately 90 active employees, had accrued benefits. The Company completed the termination of this plan in the second quarter of 2015, after regulatory approvals were obtained. The Company made a cash contribution of $0.5 to provide for final accrued benefits and recorded a one-time expense in SG&A of $8.9 ($6.7 after tax) in the Consumer International segment when the plan settlement was completed. This expense is primarily attributable to pension settlement accounting rules which require accelerated recognition of actuarial losses that were to be amortized over the expected benefit lives of participants.

Deferred Compensation Plans

The Company maintains a deferred compensation plan under which certain members of management are eligible to defer a maximum of 85% of their regular compensation (i.e. salary) and incentive bonus. The amounts deferred under this plan are credited with earnings or losses based upon changes in values of notional investments elected by the plan participant. The investment options available include notional investments in various stock, bond and money market funds as well as Common Stock. Each plan participant is fully vested in the amounts the participant defers. The plan also functions as an “excess” plan whereby profit sharing contributions that cannot otherwise be contributed to the qualified savings and profit sharing plan due to limitations under Department of Treasury regulations are credited to this plan. These contributions vest under the same vesting schedule applicable to the qualified plan.

The liability to plan participants for contributions designated for notional investment in Common Stock is based on the quoted fair value of the Common Stock plus any dividends credited. The Company uses cash-settled hedging instruments to minimize the cost related to the volatility of Common Stock. At December 31, 2016 and 2015, the amount of the Company’s liability under the deferred compensation plan is included in Deferred and Other Long-term Liabilities and was $98.3 and $95.8, respectively and the funded balances recorded in Other Assets amounted to $73.9 and $70.6, respectively. The amounts charged to earnings, including the effect of the hedges, totaled $2.3, $2.1, and $1.8 in 2016, 2015 and 2014, respectively.

Non-employee members of the Company’s Board are eligible to defer up to 100% of their directors’ compensation into a similar plan; however, the only option for investment is Common Stock. Members of the Board are fully vested in their account balance. As of December 31, 2016, there were approximately 307 thousand shares of Common Stock from shares held as Treasury Stock in a rabbi trust to protect the interest of the directors’ deferred compensation plan participants in the event of a change of control.