Stock Compensation

3 Months Ended

Mar. 31, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Compensation

Stock Compensation

The Compensation Committee of our Board of Directors approved the grant of stock options, stock appreciation rights (SARs) and restricted stock units (RSUs) shown in the table below during the first quarter of 2013.

		Weighted-average Per Share
	Granted (In millions)	Exercise Price		Grant Date Fair Value
Stock options	0.9	$	16.19	$	7.45
SARs	0.2	$	16.19	$	7.45
RSUs	0.5			$	16.24

Stock options and SARs related to 0.2 million shares were exercised and an insignificant number of shares were forfeited in 2013. We received $1 of cash from the exercise of stock options and we paid $2 of cash to settle SARs and performance share units during 2013. We also issued 0.1 million in RSUs and 0.4 million in performance shares based on vesting.

We estimated fair values for options and SARs granted during 2013 using the following key assumptions as part of the Black-Scholes option pricing model. The expected term was estimated using the simplified method because the limited period of time our common stock has been publicly traded provides insufficient historical exercise data. The risk-free rate was based on U.S. Treasury security yields at the time of grant. The dividend yield was calculated by dividing the expected annual dividend by the average stock price of our common stock over the prior year. The expected volatility was estimated using a combination of the historical volatility of similar entities and the implied volatility of our exchange-traded options.

	Options		SARs
Expected term (in years)	6.00		6.00
Risk-free interest rate	1.07	%	1.07	%
Dividend yield	1.41	%	1.41	%
Expected volatility	55.80	%	55.80	%

We recognized stock compensation expense of $5 and $7 during the first quarter of 2013 and 2012. At March 31, 2013, the total unrecognized compensation cost related to the nonvested equity awards granted and expected to vest was $28. This cost is expected to be recognized over a weighted-average period of 2.3 years.