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EARNINGS PER SHARE | 9 Months Ended
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Oct. 02, 2021
Earnings Per Share [Abstract] |
EARNINGS PER SHARE | EARNINGS PER SHARE The following table reconciles net earnings attributable to common shareowners and the weighted-average shares outstanding used to calculate basic and diluted earnings per share for the three and nine months ended October 2, 2021 and September 26, 2020:
| Third Quarter |  | Year-to-Date
| 2021 |  | 2020 |  | 2021 |  | 2020
Numerator (in millions): |  |  |  |  |  |  |
Net Earnings Attributable to Common Shareowners | $ | 414.6 |  |  | $ | 385.5 |  |  | $ | 1,347.8 |  |  | $ | 752.4 |
Denominator (in thousands): |  |  |  |  |  |  |
Basic weighted-average shares outstanding | 159,444 |  |  | 156,370 |  |  | 158,494 |  |  | 153,345 |
Dilutive effect of stock contracts and awards | 5,892 |  |  | 1,601 |  |  | 6,406 |  |  | 1,414 |
Diluted weighted-average shares outstanding | 165,336 |  |  | 157,971 |  |  | 164,900 |  |  | 154,759 |
Earnings per share of common stock: |  |  |  |  |  |  |
Basic | $ | 2.60 |  |  | $ | 2.47 |  |  | $ | 8.50 |  |  | $ | 4.91 |
Diluted | $ | 2.51 |  |  | $ | 2.44 |  |  | $ | 8.17 |  |  | $ | 4.86 |
The following weighted-average stock options were not included in the computation of weighted-average diluted shares outstanding because the effect would be anti-dilutive (in thousands):
| Third Quarter |  | Year-to-Date
| 2021 |  | 2020 |  | 2021 |  | 2020
Number of stock options | 1,042 |  |  | 2,059 |  |  | 948 |  |  | 2,947 |
In November 2019, the Company issued 7,500,000 Equity Units with a total notional value of $750.0 million. Each unit initially consists of 750,000 shares of convertible preferred stock ("Series D Preferred Stock") and forward stock purchase contracts. On and after November 15, 2022, the Series D Preferred Stock may be converted into common stock at the option of the holder. At the election of the Company, upon conversion, the Company may deliver cash, common stock, or a combination thereof. The conversion rate was initially 5.2263 shares of common stock per one share of Series D Preferred Stock, which was equivalent to an initial conversion price of approximately $191.34 per share of common stock. As of October 2, 2021, due to customary anti-dilution provisions, the conversion rate was 5.2301, equivalent to a conversion price of approximately $191.20 per share of common stock. The Series D Preferred Stock is excluded from the denominator of the diluted earnings per share calculation on the basis that the convertible preferred stock will be settled in cash except to the extent that the conversion value of the convertible preferred stock exceeds its liquidation preference. Therefore, before any redemption or conversion, the common shares that would be required to settle the applicable conversion value in excess of the liquidation preference, if the Company elects to settle such excess in common shares, are included in the denominator of diluted earnings per share in periods in which they are dilutive. The shares related to the Series D Preferred Stock were anti-dilutive during certain months in 2021 and during the first nine months of 2020. Beginning in the third quarter of 2021, the Company is including the shares underlying the forward stock purchase contracts in the denominator of its diluted earnings per share calculation utilizing the if-converted method, which represents a correction of an error of previously applying the treasury stock method. The change is not material to the third quarter of 2021 or previously reported financial statements. In May 2017, the Company issued 7,500,000 Equity Units with a total notional value of $750.0 million. Each unit initially consisted of 750,000 shares of convertible preferred stock ("Series C Preferred Stock") and forward stock purchase contracts. In May 2020, the Company successfully remarketed the Series C Preferred Stock, as described more fully in Note J, Equity Arrangements. The remarketing generated cash proceeds of $750.0 million which were applied to settle the holders' stock purchase contract obligations, resulting in the Company issuing 5,463,750 common shares. Holders of the remarketed Series C Preferred Stock were entitled to receive cumulative dividends, if declared by the Board of Directors, at an initial fixed rate equal to 5.0% per annum of the $1,000 per share liquidation preference (equivalent to $50.00 per annum per share). In addition, holders had the option to convert the Series C Preferred Stock into common stock. In connection with the remarketing described above, the conversion rate was reset to 6.7352 shares of the Company's common stock per one share of Series C Preferred Stock, which was equivalent to a conversion price of approximately $148.47 per share of common stock. On April 28, 2021, the Company informed holders that it would redeem all outstanding shares of the Series C Preferred Stock on June 3, 2021 (the “Redemption Date”) at $1,002.50 per share in cash (the “Redemption Price”), which was equal to 100% of the liquidation preference of a share of Series C Preferred Stock, plus accumulated and unpaid dividends to, but excluding, the Redemption Date. If a holder elected to convert its shares of Series C Preferred Stock prior to the Redemption Date, the Company elected a combination settlement with a specified ca sh amount of $1,000 per share. In June 2021, the Company redeemed the Series C Preferred Stock and settled all conversions, paying $750 million in cash and issuing 1,469,055 common shares. The conversion rate used was 6.7548 (equivalent to a conversion price set at $148.04 per common share). Prior to the Redemption Date, the Series C Preferred Stock was excluded from the denominator of the diluted earnings per share calculation on the basis that the convertible preferred stock would be settled in cash except to the extent that the conversion value of the convertible preferred stock exceeded its liquidation preference. Therefore, the common shares that would be required to settle the applicable conversion value in excess of the liquidation preference were included in the denominator of diluted earnings per share in periods in which they were dilutive. The shares related to the Series C Preferred Stock were anti-dilutive during certain months in 2020. Refer to Note J, Equity Arrangements, for further discussion of the above transactions.

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