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STOCK-BASED COMPENSATION | 12 Months Ended
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Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Our 2014 Long Term Stock Incentive Plan (the "2014 Plan") provides for the issuance of stock-based incentives in various forms to our employees and non-employee Directors. At December 31, 2018, outstanding stock-based incentives were in the form of long-term stock awards, stock options, restricted stock units, phantom stock awards and stock appreciation rights. Pre-tax compensation expense (income) for these stock-based incentives was as follows, in millions:
| 2018 |  | 2017 |  | 2016
Long-term stock awards | $ | 23 |  |  | $ | 24 |  |  | $ | 23 |
Stock options | 3 |  |  | 3 |  |  | 2 |
Restricted stock units | 4 |  |  | 2 |  |  | — |
Phantom stock awards and stock appreciation rights | (3 | ) |  | 9 |  |  | 4 |
Total | $ | 27 |  |  | $ | 38 |  |  | $ | 29 |
At December 31, 2018, 14.7 million shares of our common stock were available under the 2014 Plan for the granting of long-term stock awards, stock options and restricted stock units. L. STOCK-BASED COMPENSATION (Continued) Long-Term Stock Awards. Long-term stock awards are granted to our key employees and non-employee Directors and do not cause net share dilution, as we repurchase and retire at least an equal number of shares in the open market. We granted 715,380 shares of long-term stock awards during 2018. Our long-term stock award activity was as follows, shares in millions:
| 2018 |  | 2017 |  | 2016
Unvested stock award shares at January 1 | 3 |  |  | 4 |  |  | 5 |
Weighted average grant date fair value | $ | 24 |  |  | $ | 20 |  |  | $ | 17 |
Stock award shares granted | 1 |  |  | 1 |  |  | 1 |
Weighted average grant date fair value | $ | 41 |  |  | $ | 34 |  |  | $ | 26 |
Stock award shares vested | 2 |  |  | 2 |  |  | 2 |
Weighted average grant date fair value | $ | 21 |  |  | $ | 18 |  |  | $ | 16 |
Stock award shares forfeited | — |  |  | — |  |  | — |
Weighted average grant date fair value | $ | 31 |  |  | $ | 24 |  |  | $ | 20 |
Unvested stock award shares at December 31 | 2 |  |  | 3 |  |  | 4 |
Weighted average grant date fair value | $ | 30 |  |  | $ | 24 |  |  | $ | 20 |
At December 31, 2018, 2017 and 2016, there was $46 million, $46 million and $43 million, respectively, of total unrecognized compensation expense related to unvested stock awards; such awards had a weighted average remaining vesting period of three years at December 31, 2018, 2017 and 2016. The total market value (at the vesting date) of stock award shares which vested during 2018, 2017 and 2016 was $56 million, $45 million and $43 million, respectively. Stock Options. Stock options are granted to certain key employees. The exercise price equals the market price of our 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. We granted 400,220 shares of stock options during 2018 with a grant date weighted-average exercise price of approximately $42 per share. During 2018, 68,927 stock option shares were forfeited (including options that expired unexercised). L. STOCK-BASED COMPENSATION (Continued) Our stock option activity was as follows, shares in millions:
| 2018 |  | 2017 |  | 2016
Option shares outstanding, January 1 | 5 |  |  | 7 |  |  | 12 |
Weighted average exercise price | $ | 16 |  |  | $ | 15 |  |  | $ | 17 |
Option shares granted | — |  |  | — |  |  | — |
Weighted average exercise price | $ | 42 |  |  | $ | 34 |  |  | $ | 26 |
Option shares exercised | 1 |  |  | 2 |  |  | 5 |
Aggregate intrinsic value on date of exercise (A) | $ | 55 | million |  | $ | 47 | million |  | $ | 64 | million
Weighted average exercise price | $ | 11 |  |  | $ | 15 |  |  | $ | 21 |
Option shares forfeited | — |  |  | — |  |  | — |
Weighted average exercise price | $ | 31 |  |  | $ | — |  |  | $ | — |
Option shares outstanding, December 31 | 4 |  |  | 5 |  |  | 7 |
Weighted average exercise price | $ | 21 |  |  | $ | 16 |  |  | $ | 15 |
Weighted average remaining option term (in years) | 5 |  | 4 |  | 4
Option shares vested and expected to vest, December 31 | 4 |  |  | 5 |  |  | 7 |
Weighted average exercise price | $ | 21 |  |  | $ | 16 |  |  | $ | 15 |
Aggregate intrinsic value (A) | $ | 36 | million |  | $ | 147 | million |  | $ | 118 | million
Weighted average remaining option term (in years) | 5 |  | 4 |  | 4
Option shares exercisable (vested), December 31 | 3 |  |  | 4 |  |  | 6 |
Weighted average exercise price | $ | 16 |  |  | $ | 13 |  |  | $ | 13 |
Aggregate intrinsic value (A) | $ | 34 | million |  | $ | 123 | million |  | $ | 102 | million
Weighted average remaining option term (in years) | 4 |  | 3 |  | 3
(A) | Aggregate intrinsic value is calculated using our stock price at each respective date, less the exercise price (grant date price) multiplied by the number of shares.
At December 31, 2018, 2017 and 2016, there was $8 million, $7 million and $6 million, respectively, of unrecognized compensation expense (using the Black-Scholes option pricing model at the grant date) related to unvested stock options; such options had a weighted average remaining vesting period of three years at December 31, 2018, 2017 and 2016. 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:
| 2018 |  | 2017 |  | 2016
Weighted average grant date fair value | $ | 12.34 |  |  | $ | 9.68 |  |  | $ | 6.43 |
Risk-free interest rate | 2.72 | % |  | 2.16 | % |  | 1.41 | %
Dividend yield | 1.02 | % |  | 1.19 | % |  | 1.49 | %
Volatility factor | 29.00 | % |  | 30.00 | % |  | 29.00 | %
Expected option life | 6 years |  |  | 6 years |  |  | 6 years |
L. STOCK-BASED COMPENSATION (Concluded) The following table summarizes information for stock option shares outstanding and exercisable at December 31, 2018, shares in millions:
| Option Shares Outstanding |  | Option Shares Exercisable
| Range of Prices |  | Number of Shares |  | Weighted Average Remaining Option Term |  | Weighted Average Exercise Price |  | Number of Shares |  | Weighted Average Exercise Price
$ | 7 - 13 |  | 1 |  | 2 years |  | $11 |  | 1 |  | $11
$ | 17 - 26 |  | 2 |  | 5 years |  | $21 |  | 2 |  | $20
$ | 30 - 43 |  | 1 |  | 9 years |  | $38 |  | — |  | $34
$ | 7 - 43 |  | 4 |  | 5 years |  | $21 |  | 3 |  | $16
Restricted Stock Units. Under our Long Term Incentive Program ("LTIP Program"), we grant restricted stock units to certain senior executives. These restricted stock units will vest and share awards will be issued at no cost to the employees, subject to our achievement of specified return on invested capital performance goals over a three-year period that have been established by our Organization and Compensation Committee of the Board of Directors ("Compensation Committee") for the performance period and the recipient's continued employment through the share award date. Restricted stock units are granted at a target number; based on our performance, the number of restricted stock units that vest can be adjusted downward to zero and upward to a maximum of 200%. During 2018, we granted 113,260 restricted stock units with a grant date fair value of approximately $42 per share, and 11,600 restricted stock units were forfeited. During 2017, we granted 124,780 restricted stock units with a grant date fair value of approximately $34 per share. Phantom Stock Awards and Stock Appreciation Rights. Certain non-U.S. employees are granted phantom stock awards and historically have been granted SARs. We recognized income of $2 million in 2018 and expense of $6 million and $2 million in 2017 and 2016, respectively, related to phantom stock awards. In 2018, 2017 and 2016, we granted 98,140 shares, 104,580 shares and 140,710 shares, respectively, of phantom stock awards with an aggregate fair value of $4 million each year, and paid cash of $6 million in 2018 and $5 million in both 2017 and 2016 to settle phantom stock awards. We recognized income of $1 million in 2018 and expense of $3 million and $2 million in 2017 and 2016, respectively, related to SARs. During 2018, 2017 and 2016, we did not grant any SARs. We paid cash of $5 million in 2018 and $4 million in both 2017 and 2016 to settle SARs. Information related to phantom stock awards and SARs was as follows, in millions:
| Phantom Stock Awards |  | Stock Appreciation Rights
| At December 31, |  | At December 31,
| 2018 |  | 2017 |  | 2018 |  | 2017
Accrued compensation cost liability | $ | 4 |  |  | $ | 12 |  |  | $ | 2 |  |  | $ | 7 |
Unrecognized compensation cost | $ | 2 |  |  | $ | 4 |  |  | $ | — |  |  | $ | — |
Equivalent common shares | — |  |  | — |  |  | — |  |  | — |

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- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -URI http://asc.fasb.org/subtopic&trid=2208855 + Details
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