XML 38 R21.htm IDEA: XBRL DOCUMENT
v3.24.0.1

STOCK-BASED COMPENSATION | 12 Months Ended
--- | ---
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract] |
STOCK-BASED COMPENSATION | L. 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, 2023, outstanding stock-based incentives were in the form of restricted stock units, performance restricted stock units, stock options, long-term stock awards, phantom stock awards and stock appreciation rights ("SARs"). Pre-tax compensation expense included in income before income taxes for these stock-based incentives was as follows, in millions:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
Restricted stock units | $ | 15 |  |  | $ | 32 |  |  | $ | 28 |
Performance restricted stock units | 3 |  |  | 3 |  |  | 10 |
Stock options | 5 |  |  | 7 |  |  | 7 |
Long-term stock awards | 3 |  |  | 6 |  |  | 10 |
Phantom stock awards and stock appreciation rights | 5 |  |  | 1 |  |  | 6 |
Total | $ | 31 |  |  | $ | 49 |  |  | $ | 61 |
At December 31, 2023, 11.3 million shares of our common stock were available under the 2014 Plan for the granting of restricted stock units, performance restricted stock units, stock options and long-term stock awards. Restricted Stock Units. Restricted stock units are granted to our key employees and non-employee Directors. These grants did not cause net share dilution due to our practice of repurchasing and retiring an equal number of shares in the open market. Our restricted stock unit activity was as follows, units in thousands:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
| Number of Shares |  | Weighted Average Grant Date Fair Value |  | Number of Shares |  | Weighted Average Grant Date Fair Value |  | Number of Shares |  | Weighted Average Grant Date Fair Value
Unvested restricted stock units at January 1 | 1,154 |  |  | $ | 57 |  |  | 934 |  |  | $ | 54 |  |  | 435 |  |  | $ | 47 |
Granted | 205 |  |  | 56 |  |  | 621 |  |  | 59 |  |  | 670 |  |  | 57 |
Vested | (532) |  |  | 55 |  |  | (351) |  |  | 53 |  |  | (142) |  |  | 47 |
Forfeited | (32) |  |  | 58 |  |  | (50) |  |  | 54 |  |  | (29) |  |  | 54 |
Unvested restricted stock units at December 31 | 796 |  |  | $ | 57 |  |  | 1,154 |  |  | $ | 57 |  |  | 934 |  |  | $ | 54 |
L. STOCK-BASED COMPENSATION (Continued) At December 31, 2023, 2022, and 2021 there was $11 million, $17 million, and $15 million, respectively, of unrecognized compensation expense related to unvested restricted stock units; such units had a weighted average remaining vesting period of two years at December 31, 2023, 2022, and 2021. The total market value (at the vesting date) of restricted stock units which vested was $28 million, $20 million and $8 million during 2023, 2022 and 2021 respectively. Performance Restricted Stock Units. Under our Long Term Incentive Program, we grant performance restricted stock units to certain senior executives. These performance restricted stock units will vest and share awards will be issued at no cost to the employees, subject to our achievement over a three-year period of specified return on invested capital performance goals, an earning per share metric, and, beginning with the 2023 grant, a relative total shareholder return metric that have been established by our Compensation Committee for the performance period. To receive the award, the recipient must be employed through the share award date. Performance restricted stock units are granted at a target number; based on our performance, the number of performance restricted stock units that vest can be adjusted downward to zero and upward to a maximum of 200 percent of the target number. During 2023, we granted approximately 99,000 performance restricted stock units with a grant date fair value of approximately $52 per share, approximately 253,000 performance restricted stock units were issued and no performance restricted stock units were forfeited. At December 31, 2023, there were approximately 59,000 shares vested but unissued. During 2022, we granted approximately 92,000 performance restricted stock units with a grant date fair value of approximately $55 per share, approximately 168,000 performance restricted stock units were issued and no performance restricted stock units were forfeited. At December 31, 2022, there were approximately 255,000 shares vested but unissued. During 2021, we granted approximately 85,000 performance restricted stock units with a grant date fair value of approximately $53 per share, approximately 105,000 performance restricted stock units were issued and no performance restricted stock units were forfeited. At December 31, 2021, there were approximately 186,000 shares vested but unissued. 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 and the stock options expire no later than 10 years after the grant date. Our stock option activity was as follows, shares in thousands:
| Year Ended December 31,
| 2023 | 2022 | 2021
| Number of Shares |  | Weighted Average Exercise Price |  | Number of Shares |  | Weighted Average Exercise Price |  | Number of Shares |  | Weighted Average Exercise Price
Outstanding stock options at January 1 | 2,988 |  |  | $ | 39 |  |  | 2,692 |  |  | $ | 37 |  |  | 2,488 |  |  | $ | 33 |
Granted | 228 |  |  | 57 |  |  | 338 |  |  | 59 |  |  | 332 |  |  | 56 |
Exercised | (940) |  |  | 29 |  |  | (32) |  |  | 34 |  |  | (128) |  |  | 25 |
Forfeited | (22) |  |  | 36 |  |  | (10) |  |  | 37 |  |  | — |  |  | 11 |
Outstanding stock options at December 31 | 2,254 |  |  | $ | 45 |  |  | 2,988 |  |  | $ | 39 |  |  | 2,692 |  |  | $ | 37 |
The 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. The aggregate intrinsic value for options exercised during 2023, 2022 and 2021 was $26 million, $1 million and $5 million, respectively. The weighted-average remaining term for options outstanding at December 31, 2023, 2022 and 2021 was six years, five years and six years, respectively. L. STOCK-BASED COMPENSATION (Continued) The following table summarizes information for stock options vested and expected to vest and exercisable (vested) stock options, shares in thousands:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
| Vested and Expected to Vest Stock Options |  | Exercisable (Vested) Stock Options |  | Vested and Expected to Vest Stock Options |  | Exercisable (Vested) Stock Options |  | Vested and Expected to Vest Stock Options |  | Exercisable (Vested) Stock Options
Number of shares | 2,248 |  | 1,621 |  | 2,966 |  | 2,051 |  | 2,617 |  | 1,606
Weighted average exercise price | $ | 45 |  | $ | 42 |  | $ | 39 |  | $ | 34 |  | $ | 36 |  | $ | 31
Aggregate intrinsic value | $ | 48 | million |  | $ | 41 | million |  | $ | 30 | million |  | $ | 28 | million |  | $ | 89 | million |  | $ | 63 | million
Weighted-average remaining term | 6 years |  | 5 years |  | 5 years |  | 4 years |  | 6 years |  | 5 years
At December 31, 2023, 2022 and 2021, there was $1 million, $1 million and $4 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 two years, one year and two years at December 31, 2023, 2022 and 2021, respectively. 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:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
Weighted average grant date fair value | $ | 16.91 |  |  | $ | 14.66 |  |  | $ | 13.61 |
Risk-free interest rate | 3.95 | % |  | 1.90 | % |  | 0.75 | %
Dividend yield | 2.02 | % |  | 1.89 | % |  | 1.67 | %
Volatility factor | 31.00 | % |  | 29.00 | % |  | 30.00 | %
Expected option life | 6 years |  | 6 years |  | 6 years
The following table summarizes information for stock option shares outstanding and exercisable, shares in thousands:
At December 31, 2023,
| 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
$ | 22 - 26 |  | 256 |  | 2 |  | $25 |  | 256 |  | $25
$ | 27 - 36 |  | 538 |  | 4 |  | $35 |  | 469 |  | $35
$ | 37 - 60 |  | 1,459 |  | 7 |  | $53 |  | 896 |  | $50
$ | 22 - 60 |  | 2,254 |  | 6 |  | $45 |  | 1,621 |  | $42
L. STOCK-BASED COMPENSATION (Concluded) Long-Term Stock Awards. Prior to the amendment of our 2014 Plan in December 2019, we granted long-term stock awards to our key employees and non-employee Directors. Our long-term stock award activity was as follows, shares in thousands:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
| Number of Shares |  | Weighted Average Grant Date Fair Value |  | Number of Shares |  | Weighted Average Grant Date Fair Value |  | Number of Shares |  | Weighted Average Grant Date Fair Value
Unvested stock award shares at January 1 | 273 |  |  | $ | 38 |  |  | 608 |  |  | $ | 37 |  |  | 1,125 |  |  | $ | 36 |
Vested | (191) |  |  | 40 |  |  | (324) |  |  | 37 |  |  | (491) |  |  | 34 |
Forfeited | (3) |  |  | 36 |  |  | (11) |  |  | 38 |  |  | (26) |  |  | 36 |
Unvested stock award shares at December 31 | 79 |  |  | $ | 36 |  |  | 273 |  |  | $ | 38 |  |  | 608 |  |  | $ | 37 |
At December 31, 2023, the total unrecognized compensation expense related to unvested stock awards was insignificant and the unvested stock awards will vest in 2024. At December 31, 2022 and 2021, there was $3 million and $10 million, respectively, of total unrecognized compensation expense related to unvested stock awards; such awards had a weighted average remaining vesting period at December 31, 2022 and 2021 of one year and two years, respectively. The total market value (at the vesting date) of stock award shares which vested was $10 million, $21 million and $28 million during 2023, 2022 and 2021, respectively. Phantom Stock Awards and Stock Appreciation Rights. Certain non-U.S. employees are granted phantom stock awards and SARs. We recognized expense of $5 million, $1 million and $6 million in 2023, 2022 and 2021, respectively, related to phantom stock awards. In 2023, 2022 and 2021, we granted approximately 57,000, 74,000, and 82,000 shares, respectively, of phantom stock awards with an aggregate fair value of $3 million, $4 million and $5 million in 2023, 2022 and 2021, respectively, and paid cash of $4 million in 2023, $4 million in 2022 and $3 million in 2021 to settle phantom stock awards. Information related to phantom stock awards was as follows, dollars in millions and shares in thousands:
| At December 31, |  |
| 2023 |  | 2022 |  |  |  |
Accrued compensation cost liability | $ | 6 |  |  | $ | 5 |  |  |  |  |
Unrecognized compensation cost | $ | 2 |  |  | $ | 2 |  |  |  |  |
Equivalent common shares | 126 |  |  | 149 |  |  |  |  |
We granted 22,000 shares of SARs in 2023, and the associated expense recognized in 2023 was insignificant. No SARs were granted in 2022 or 2021, and no expense was recognized in either year.

X
- Definition The entire disclosure for share-based payment arrangement. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a)(1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//718/tableOfContent Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h)(2) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h)(2)(i) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (l) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480429/718-10-50-2 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration