Annual report pursuant to Section 13 and 15(d)

STOCK COMPENSATION PLANS (Tables)

v3.19.3.a.u2
STOCK COMPENSATION PLANS (Tables)
 12 Months Ended
Dec. 31, 2019
STOCK COMPENSATION PLANS [Abstract]  
Weighted-average fair value of options granted and the weighted-average assumptions used in the Black Scholes Merton option pricing model for such grants The weighted-average fair value of stock options granted during the years ended December 31, 2019, 2018 and 2017 and the weighted-average assumptions used in the Black-Scholes-Merton option-pricing model for such grants were as follows:
Year Ended December 31,
2019

 
2018

 
2017

Fair value of stock options on grant date
$
4.94

 
$
4.97

 
$
3.98

Dividend yield1
3.5
%
 
3.5
%
 
3.6
%
Expected volatility2
15.5
%
 
15.5
%
 
15.5
%
Risk-free interest rate3
2.6
%
 
2.8
%
 
2.2
%
Expected term of stock options4
6 years

 
6 years

 
6 years

1 
The dividend yield is the calculated yield on the Company's stock on the grant date.
2 
The expected volatility is based on implied volatilities from traded options on the Company's stock, historical volatility of the Company's stock and other factors.
3 
The risk-free interest rate for the period matching the expected term of the stock options is based on the U.S. Treasury yield curve in effect on the grant date.
4 
The expected term of the stock options represents the period of time that options granted are expected to be outstanding and is derived by analyzing historical exercise behavior.
Stock option activity for all plans
Stock option activity for all plans for the year ended December 31, 2019 was as follows:
 
Shares
(In millions)

 
Weighted-Average
Exercise Price

 
Weighted-Average
Remaining
Contractual Life
 
Aggregate
Intrinsic Value
(In millions)

Outstanding on January 1, 2019
133

 
$
36.74

 
 
 
 

Granted
8

 
45.46

 
 
 
 

Exercised
(34
)
 
33.29

 
 
 
 

Forfeited/expired
(2
)
 
42.88

 
 
 
 

Outstanding on December 31, 2019
105

 
$
38.43

 
4.41 years
 
$
1,785

Expected to vest
104

 
$
38.37

 
4.37 years
 
$
1,773

Exercisable on December 31, 2019
89

 
$
37.33

 
3.69 years
 
$
1,599

Summary of information about performance share units based on the Target Award amounts in the performance share unit agreements
The following table summarizes information about performance share units and growth share units based on the target award amounts:
 
Performance Share Units and Growth Share Units
(In thousands)

 
Weighted-Average
Grant Date
Fair Value

Outstanding on January 1, 2019
7,698

 
$
38.45

Granted
2,348

 
40.29

Conversions into restricted stock units1
(2,756
)
 
39.70

Paid in cash equivalent
(1
)
 
40.62

Canceled/forfeited
(458
)
 
38.53

Outstanding on December 31, 20192
6,831

 
$
38.57

1 
Represents the target amount of performance share units converted into restricted stock units for the 2016-2018 performance period. The vesting of restricted stock units is subject to the terms of the performance share unit agreements.
2 
The outstanding performance share units and growth share units as of December 31, 2019 at the threshold award and maximum award levels were 2.6 million and 14.2 million, respectively.
Schedule of Nonvested Restricted Stock Units Activity [Table Text Block]
The following table summarizes information about nonvested performance-based restricted stock units based on the performance share units' certified award level:
Restricted
Stock Units
(In thousands)

Weighted-
Average
Grant Date
Fair Value

Nonvested on January 1, 2019
2,591

$
36.24

Conversions from performance share units
3,355

39.70

Vested and released
(2,575
)
36.12

Canceled/forfeited
(176
)
39.37

Nonvested on December 31, 2019
3,195

$
39.70


Nonvested Restricted Stock Shares Activity [Table Text Block]
The following table summarizes information about nonvested time-based restricted stock and restricted stock units:
 
Restricted Stock and Restricted Stock Units
(In thousands)

Weighted-Average
Grant Date
Fair Value

Nonvested on January 1, 2019
3,422

$
40.31

Granted
1,615

42.31

Vested and released
(528
)
42.35

Forfeited/expired
(455
)
41.41

Nonvested on December 31, 2019
4,054

$
40.73