Stock Transactions And Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2018

Assumptions Used In The Black-Scholes Model To Value Options Granted

The following summarizes the assumptions used in the Black-Scholes model to value options granted during the years ended December 31:



	2018		2017		2016
Risk-free interest rate	2.6 – 3.1%		1.8 – 2.2%		1.2 – 1.8%
Weighted average volatility	21.4	%	17.9	%	24.3	%
Dividend yield	0.6	%	0.7	%	0.6	%
Expected years until exercise	5.0 – 8.0		5.0 – 8.0		5.5 – 8.0

Components Of Share-Based Compensation Program

The following summarizes the components of the Company’s continuing operations stock-based compensation expense for the years ended December 31 ($ in millions):



	2018			2017			2016
RSUs/PSUs:
Pretax compensation expense	$	94.7		$	90.2		$	85.9
Income tax benefit	(19.8		)	(27.7		)	(25.3		)
RSU/PSU expense, net of income taxes	74.9			62.5			60.6
Stock options:
Pretax compensation expense	56.7			49.2			43.9
Income tax benefit	(12.0		)	(15.6		)	(13.6		)
Stock option expense, net of income taxes	44.7			33.6			30.3
Total stock-based compensation:
Pretax compensation expense	151.4			139.4			129.8
Income tax benefit	(31.8		)	(43.3		)	(38.9		)
Total stock-based compensation expense, net of income taxes	$	119.6		$	96.1		$	90.9

Option Activity Under The Company's Stock Plans

The following summarizes option activity under the Company’s stock plans (in millions, except weighted exercise price and number of years):



	Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value
Outstanding as of January 1, 2016	24.9		$	43.75
Granted	5.7		67.52
Exercised	(5.3	)	33.45
Cancelled/forfeited	(1.2	)	73.21
Adjustment due to Fortive Separation ^(a)	(5.2	)	50.44
Outstanding as of December 31, 2016	18.9		50.07
Granted	4.4		86.14
Exercised	(3.3	)	35.26
Cancelled/forfeited	(1.2	)	70.40
Outstanding as of December 31, 2017	18.8		59.84
Granted	4.1		99.51
Exercised	(3.4	)	41.88
Cancelled/forfeited	(0.9	)	80.14
Outstanding as of December 31, 2018	18.6		70.86		7	$	600.8
Vested and expected to vest as of December 31, 2018 ^(b)	18.0		$	70.24	7	$	592.8
Vested as of December 31, 2018	7.7		$	53.19	5	$	383.3


^(a)	The “Adjustment due to Fortive Separation” reflects the cancellation of options which were outstanding as of July 2, 2016 and held by Fortive employees, which have been converted to Fortive equity awards as part of the Fortive Separation.


^(b)	The “expected to vest” options are the net unvested options that remain after applying the forfeiture rate assumption to total unvested options.

Summary Of Options Outstanding

Options outstanding as of December 31, 2018 are summarized below (in millions, except price per share and number of years):



	Outstanding				Exercisable
Exercise Price	Shares	Average Exercise Price		Average Remaining Life (in years)	Shares	Average Exercise Price
$19.89 to $39.60	2.1	$	34.15	2	2.0	$	34.13
$39.61 to $56.70	2.5	48.73		4	2.3	48.15
$56.71 to $70.75	6.1	64.58		6	2.6	63.64
$70.76 to $86.08	3.9	85.13		8	0.7	84.37
$86.09 to $101.65	4.0	99.23		9	0.1	95.44

RSU And Restricted Stock Activity

The following summarizes information on unvested RSU and PSU activity (in millions, except weighted average grant-date fair value):



	Number of RSUs/PSUs		Weighted Average Grant-Date Fair Value
Unvested as of January 1, 2016	6.1		$	53.93
Granted	1.9		66.15
Vested	(1.8	)	50.64
Adjustment due to Fortive Separation ^(a)	(1.2	)	58.24
Forfeited	(0.5	)	28.79
Unvested as of December 31, 2016	4.5		62.16
Granted	1.4		86.04
Vested	(1.5	)	58.48
Forfeited	(0.5	)	68.83
Unvested as of December 31, 2017	3.9		71.27
Granted	1.5		99.15
Vested	(1.2	)	68.37
Forfeited	(0.3	)	78.41
Unvested as of December 31, 2018	3.9		82.21


^(a)	The “Adjustment due to Fortive Separation” reflects the cancellation of RSUs and PSUs which were outstanding as of July 2, 2016 and held by Fortive employees which have been converted to Fortive equity awards as part of the Fortive Separation.