STOCKHOLDERS' EQUITY

A reconciliation of the changes in stockholders' equity for 2017, 2016, and 2015 is provided below:



(Dollars in millions)	Common Stock at Par Value		Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock at Cost			Total Eastman Stockholders' Equity			Noncontrolling Interest			Total Equity
Balance at December 31, 2014	$	2	$	1,817		$	4,545		$	(277	)	$	(2,577	)	$	3,510		$	80		$	3,590
Net Earnings	—		—			848			—			—			848			6			854
Cash Dividends ⁽¹⁾	—		—			(247		)	—			—			(247		)	—			(247		)
Other Comprehensive (Loss)	—		—			—			(113		)	—			(113		)	—			(113		)
Share-Based Compensation Expense ⁽²⁾	—		37			—			—			—			37			—			37
Stock Option Exercises	—		8			—			—			—			8			—			8
Other	—		1			—			—			—			1			—			1
Share Repurchase	—		—			—			—			(103		)	(103		)	—			(103		)
Distributions to noncontrolling interest	—		—			—			—			—			—			(6		)	(6		)
Balance at December 31, 2015	$	2	$	1,863		$	5,146		$	(390	)	$	(2,680	)	$	3,941		$	80		$	4,021
Net Earnings	—		—			854			—			—			854			5			859
Cash Dividends ⁽¹⁾	—		—			(279		)	—			—			(279		)	—			(279		)
Other Comprehensive Income	—		—			—			109			—			109			—			109
Share-Based Compensation Expense ⁽²⁾	—		35			—			—			—			35			—			35
Stock Option Exercises	—		21			—			—			—			21			—			21
Other	—		(4		)	—			—			—			(4		)	(1		)	(5		)
Share Repurchase	—		—			—			—			(145		)	(145		)	—			(145		)
Distributions to noncontrolling interest	—		—			—			—			—			—			(8		)	(8		)
Balance at December 31, 2016	$	2	$	1,915		$	5,721		$	(281	)	$	(2,825	)	$	4,532		$	76		$	4,608
Net Earnings	—		—			1,384			—			—			1,384			4			1,388
Cash Dividends ⁽¹⁾	—		—			(303		)	—			—			(303		)	—			(303		)
Other Comprehensive Income	—		—			—			72			—			72			—			72
Share-Based Compensation Expense ⁽²⁾	—		52			—			—			—			52			—			52
Stock Option Exercises	—		22			—			—			—			22			—			22
Other	—		(6		)	—			—			—			(6		)	1			(5		)
Share Repurchase	—		—			—			—			(350		)	(350		)	—			(350		)
Distributions to noncontrolling interest	—		—			—			—			—			—			(4		)	(4		)
Balance at December 31, 2017	$	2	$	1,983		$	6,802		$	(209	)	$	(3,175	)	$	5,403		$	77		$	5,480


⁽¹⁾	Cash dividends includes cash dividends paid and dividends declared, but unpaid.


⁽²⁾	Share-based compensation expense is the fair value of share-based awards.

Eastman is authorized to issue 400 million shares of all classes of stock, of which 50 million may be preferred stock, par value $0.01 per share, and 350 million may be common stock, par value $0.01 per share. The Company declared dividends per share of $2.09 in 2017, $1.89 in 2016, and $1.66 in 2015.

The Company established a benefit security trust in 1997 to provide a degree of financial security for unfunded obligations under certain unfunded plans and contributed to the trust a warrant to purchase up to 6 million shares of common stock of the Company for par value. The warrant, which remains outstanding, is exercisable by the trustee if the Company does not meet certain funding obligations, which obligations would be triggered by certain occurrences, including a change in control or potential change in control, as defined, or failure by the Company to meet its payment obligations under certain covered unfunded plans. Such warrant is excluded from the computation of diluted earnings per share because the conditions upon which the warrant becomes exercisable have not been met.

The additions to paid-in capital in 2017, 2016, and 2015 are primarily for compensation expense of equity awards and employee stock option exercises.

In February 2014, the Company's Board of Directors authorized repurchase of up to $1 billion of the Company's outstanding common stock at such times, in such amounts, and on such terms, as determined by management to be in the best interests of the Company. As of December 31, 2017, a total of 10,726,827 shares have been repurchased under this authorization for a total of $848 million. During 2017, the Company repurchased 4,184,637 shares of common stock for a cost of approximately $350 million. During 2016, the Company repurchased 2,131,501 shares of common stock for a cost of approximately $145 million. During 2015, the Company repurchased 1,477,660 shares of common stock for a cost of approximately $103 million.

In February 2018, the Company's Board of Directors authorized the repurchase of up to an additional $2 billion of Eastman's outstanding common stock at such times, in such amounts, and on such terms, as determined by management to be in the best interests of the Company.

The Company's charitable foundation held 50,798 shares of the Company's common stock at December 31, 2017, 2016, and 2015 which are included in treasury stock.

The following table sets forth the computation of basic and diluted earnings per share ("EPS"):



	For years ended December 31,
(In millions, except per share amounts)	2017		2016		2015
Numerator
Net earnings attributable to Eastman	$	1,384	$	854	$	848

Denominator
Weighted average shares used for basic EPS	144.8		147.3		148.6
Dilutive effect of stock options and other award plans	1.3		1.1		1.2
Weighted average shares used for diluted EPS	146.1		148.4		149.8

EPS⁽¹⁾
Basic	$	9.56	$	5.80	$	5.71
Diluted	$	9.47	$	5.75	$	5.66


⁽¹⁾	Earnings per share are calculated using whole dollars and shares.

Stock options excluded from the 2017, 2016, and 2015 calculations of diluted earnings per share were 204,978, 1,072,468, and 768,134, respectively, because the market value of option exercises for these awards were less than the cash proceeds that would be received from these exercises.

Shares of common stock issued, including shares held in treasury, are presented below:



	For years ended December 31,
	2017	2016	2015

Balance at beginning of year	217,707,600	216,899,964	216,256,971
Issued for employee compensation and benefit plans	662,392	807,636	642,993
Balance at end of year	218,369,992	217,707,600	216,899,964

Accumulated Other Comprehensive Income (Loss)



(Dollars in millions)	Cumulative Translation Adjustment			Benefit Plans Unrecognized Prior Service Credits			Unrealized Gains (Losses) on Cash Flow Hedges			Unrealized Losses on Investments			Accumulated Other Comprehensive Income (Loss)
Balance at December 31, 2015	$	(284	)	$	129		$	(234	)	$	(1	)	$	(390	)
Period change	(97		)	34			172			—			109
Balance at December 31, 2016	(381		)	163			(62		)	(1		)	(281		)
Period change	85			(27		)	14			—			72
Balance at December 31, 2017	$	(296	)	$	136		$	(48	)	$	(1	)	$	(209	)

Amounts of other comprehensive income (loss) are presented net of applicable taxes. Eastman records deferred income taxes on the cumulative translation adjustment related to branch operations and income from other entities included in the Company's consolidated U.S. tax return. No deferred income taxes are provided on the cumulative translation adjustment of other subsidiaries outside the United States, as the cumulative translation adjustment is considered to be a component of indefinitely invested, unremitted earnings of these foreign subsidiaries.

Components of total other comprehensive income (loss) recorded in the Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings are presented below, before tax and net of tax effects:



	For years ended December 31,
	2017						2016						2015
(Dollars in millions)	Before Tax			Net of Tax			Before Tax			Net of Tax			Before Tax			Net of Tax
Change in cumulative translation adjustment	$	85		$	85		$	(97	)	$	(97	)	$	(216	)	$	(216	)
Defined benefit pension and other postretirement benefit plans:
Prior service credit arising during the period	—			—			103			64			140			87
Amortization of unrecognized prior service credits included in net periodic costs	(43		)	(27		)	(48		)	(30		)	(30		)	(19		)
Change in defined benefit pension and other postretirement benefit plans	(43		)	(27		)	55			34			110			68
Derivatives and hedging:
Unrealized gain (loss) during period	11			7			150			93			(78		)	(48		)
Reclassification adjustment for losses included in net income, net	11			7			127			79			134			83
Change in derivatives and hedging	22			14			277			172			56			35
Total other comprehensive income (loss)	$	64		$	72		$	235		$	109		$	(50	)	$	(113	)

For additional information regarding the impact of reclassifications into earnings, refer to Note 9, "Derivative and Non-Derivative Financial Instruments" and Note 10, "Retirement Plans".