XML 20 R15.htm IDEA: XBRL DOCUMENT  v2.3.0.11
Stock-Based Compensation
 6 Months Ended
Jun. 30, 2011
Stock-Based Compensation [Abstract]  
Stock-Based Compensation
Disclosure Of Compensation Related Costs Share Based Payments
H.   The Company’s 2005 Long Term Stock Incentive Plan (the “2005 Plan”) provides for the issuance of stock-based incentives in various forms to employees and non-employee Directors of the Company. At June 30, 2011, outstanding stock-based incentives were in the form of long-term stock awards, stock options, phantom stock awards and stock appreciation rights. Pre-tax compensation expense and the related income tax benefit, for these stock-based incentives, were as follows, in millions:
                                 
    Three Months Ended     Six Months Ended  
    June 30,         June 30,  
    2011     2010     2011     2010  
Long-term stock awards
  $ 9     $ 9     $ 19     $ 19  
Stock options
    6       6       11       11  
Phantom stock awards and stock appreciation rights
    (1 )     (4 )     2       (1 )
 
                       
Total
  $ 14     $ 11     $ 32     $ 29  
 
                       
 
                               
Income tax benefit
  $ 5     $ 4     $ 12     $ 11  
 
                       
    Long-Term Stock Awards
    Long-term stock awards are granted to key employees and non-employee Directors of the Company and do not cause net share dilution inasmuch as the Company continues the practice of repurchasing and retiring an equal number of shares on the open market.
 
    The Company’s long-term stock award activity was as follows, shares in millions:
                 
    Six Months Ended
    June 30,
    2011   2010
Unvested stock award shares at January 1
    10       9  
Weighted average grant date fair value
  $ 19     $ 21  
 
               
Stock award shares granted
    2       3  
Weighted average grant date fair value
  $ 13     $ 14  
 
               
Stock award shares vested
    1       1  
Weighted average grant date fair value
  $ 19     $ 23  
 
               
Stock award shares forfeited
    —       —  
Weighted average grant date fair value
  $ 18     $ 20  
 
               
Unvested stock award shares at June 30
    11       11  
Weighted average grant date fair value
  $ 17     $ 19  
    At June 30, 2011 and 2010, there was $134 million and $145 million, respectively, of total unrecognized compensation expense related to unvested stock awards; such awards had a weighted average remaining vesting period of five years and six years, respectively.
 
    The total market value (at the vesting date) of stock award shares which vested during the six months ended June 30, 2011 and 2010 was $23 million and $17 million, respectively.
 
    Stock Options
 
    Stock options are granted to key employees of the Company. The exercise price equals the market price of the Company’s common stock at the grant date. These options generally become exercisable (vest ratably) over five years beginning on the first anniversary from the date of grant and expire no later than 10 years after the grant date.
 
    The Company granted 2,372,500 of stock option shares in the six months ended June 30, 2011 with a grant date exercise price approximating $13 per share. In the first six months of 2011, 2,591,700 stock option shares were forfeited (including options that expired unexercised).
     The Company’s stock option activity was as follows, shares in millions:
                 
    Six Months Ended  
    June 30,  
    2011     2010  
Option shares outstanding, January 1
    37       36  
Weighted average exercise price
  $ 21     $ 23  
 
               
Option shares granted, including restoration options
    2       5  
Weighted average exercise price
  $ 13     $ 14  
 
               
Option shares exercised
    —       —  
Aggregate intrinsic value on date of exercise (A)
  $ 1  million   $ 1  million
Weighted average exercise price
  $ 8     $ 8  
 
               
Option shares forfeited
    2       3  
Weighted average exercise price
  $ 22     $ 23  
 
               
Option shares outstanding, June 30
    37       38  
Weighted average exercise price
  $ 21     $ 21  
Weighted average remaining option term (in years)
    6       6  
 
               
Option shares vested and expected to vest, June 30
    37       37  
Weighted average exercise price
  $ 21     $ 21  
Aggregate intrinsic value (A)
  $ 20  million   $ 14  million
Weighted average remaining option term (in years)
    6       6  
 
               
Option shares exercisable (vested), June 30
    24       22  
Weighted average exercise price
  $ 24     $ 25  
Aggregate intrinsic value (A)
  $ 8  million   $ 3  million
Weighted average remaining option term (in years)
    5       5  
 
(A)   Aggregate intrinsic value is calculated using the Company’s stock price at each respective date, less the exercise price (grant date price) multiplied by the number of shares.
  At June 30, 2011 and 2010, there was $45 million and $56 million, respectively, of unrecognized compensation expense (using the Black-Scholes option pricing model) related to unvested stock options; such options had a weighted average vesting period of three years in both 2011 and 2010.
    The weighted average grant date fair value of option shares granted and the assumptions used to estimate those values using a Black-Scholes option pricing model, were as follows:
                 
    Six Months Ended  
    June 30,  
    2011     2010  
Weighted average grant date fair value
  $ 5.10     $ 5.30  
Risk-free interest rate
    2.72 %     2.77 %
Dividend yield
    2.34 %     2.17 %
Volatility factor
    49.00 %     46.01 %
Expected option life
  6 years   6 years