10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC  20549

FORM 10-Q

(Mark One)
[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended June 30, 2017
	OR
[   ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ______________ to ______________

Commission file number 1-12626

EASTMAN CHEMICAL COMPANY

(Exact name of registrant as specified in its charter)

Delaware	62-1539359
(State or other jurisdiction of	(I.R.S. employer
incorporation or organization)	identification no.)
200 South Wilcox Drive
Kingsport, Tennessee	37662
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code: (423) 229-2000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YES [X]  NO  [  ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

YES [X]  NO  [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	[X]		Accelerated filer	[  ]
Non-accelerated filer	[   ]	(Do not check if a smaller reporting company)	Smaller reporting company	[  ]
			Emerging growth company	[  ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

YES [  ]  NO  [  ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES [  ]  NO  [X]

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Class	Number of Shares Outstanding at June 30, 2017
Common Stock, par value $0.01 per share	144,879,098

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1

TABLE OF CONTENTS

ITEM PAGE

Forward-Looking Statements 3

PART I.  FINANCIAL INFORMATION

1.	Financial Statements
	Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings	4
	Unaudited Consolidated Statements of Financial Position	5
	Unaudited Consolidated Statements of Cash Flows	6
	Notes to the Unaudited Consolidated Financial Statements	7
2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	27
3.	Quantitative and Qualitative Disclosures About Market Risk	47
4.	Controls and Procedures	47

PART II.  OTHER INFORMATION

1.	Legal Proceedings	48
1A.	Risk Factors	48
2.	Unregistered Sales of Equity Securities and Use of Proceeds	49
5.	Other Information	49
6.	Exhibits	49

SIGNATURES

Signatures 50

EXHIBIT INDEX

Exhibit Index 51

2

FORWARD-LOOKING STATEMENTS

Certain statements made or incorporated by reference in this Quarterly Report are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act, Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities and Exchange Act of 1934, as amended. Forward-looking statements are all statements, other than statements of historical fact, that may be made by Eastman Chemical Company ("Eastman" or the "Company") from time to time. In some cases, you can identify forward-looking statements by terminology such as "anticipates," "believes," "estimates," "expects," "intends," "may," "plans," "projects," "will," "would," and similar expressions or expressions of the negative of these terms. Forward-looking statements may relate to, among other things, such matters as planned and expected capacity increases and utilization; anticipated capital spending; expected depreciation and amortization; environmental matters; exposure to, and effects of hedging of, raw material and energy costs; foreign currencies and interest rates; disruption of raw material or energy supply; global and regional economic, political, and business conditions; competition; growth opportunities; supply and demand, volume, price, cost, margin and sales; pending and future legal proceedings; earnings, cash flow, dividends and other expected financial results, events, and conditions; expectations, strategies, and plans for individual assets and products, businesses, and operating segments, as well as for the whole of Eastman; cash requirements and uses of available cash; financing plans and activities; pension expenses and funding; credit ratings; anticipated and other future restructuring, acquisition, divestiture, and consolidation activities; cost reduction and control efforts and targets; the timing and costs of, and benefits from, the integration of, and expected business and financial performance of, acquired businesses; strategic initiatives and development, production, commercialization and acceptance of new products, services and technologies and related costs; asset, business, and product portfolio changes; and expected tax rates and net interest costs.

Forward-looking statements are based upon certain underlying assumptions as of the date such statements were made. Such assumptions are based upon internal estimates and other analyses of current market conditions and trends, management expectations, plans, and strategies, economic conditions, and other factors. Forward-looking statements and the assumptions underlying them are necessarily subject to risks and uncertainties inherent in projecting future conditions and results. Actual results could differ materially from expectations expressed in the forward-looking statements if one or more of the underlying assumptions and expectations proves to be inaccurate or is unrealized. The most significant known factors, risks, and uncertainties that could cause actual results to differ materially from those in the forward-looking statements are identified and discussed under "Management's Discussion and Analysis of Financial Condition and Results of Operations - Risk Factors" in Part I, Item 2 of this Quarterly Report. Other factors, risks or uncertainties of which we are not aware, or presently deem immaterial, could also cause actual results to differ materially from those in the forward-looking statements.

The Company cautions you not to place undue reliance on forward-looking statements, which speak only as of the date such statements are made. Except as may be required by law, the Company undertakes no obligation to update or alter these forward-looking statements, whether as a result of new information, future events, or otherwise.

3

UNAUDITED CONSOLIDATED STATEMENTS OF EARNINGS,

COMPREHENSIVE INCOME AND RETAINED EARNINGS

	Second Quarter					First Six Months
(Dollars in millions, except per share amounts)	2017		2016			2017			2016
Sales	$	2,419	$	2,297		$	4,722		$	4,533
Cost of sales	1,768		1,692			3,446			3,294
Gross profit	651		605			1,276			1,239
Selling, general and administrative expenses	176		174			350			357
Research and development expenses	55		55			109			109
Asset impairments and restructuring gains, net	—		—			—			(2		)
Operating earnings	420		376			817			775
Net interest expense	61		63			121			127
Early debt extinguishment costs	—		9			—			9
Other (income) charges, net	—		(20		)	(4		)	(8		)
Earnings before income taxes	359		324			700			647
Provision for income taxes	65		67			127			139
Net earnings	294		257			573			508
Less: Net earnings attributable to noncontrolling interest	2		2			3			2
Net earnings attributable to Eastman	$	292	$	255		$	570		$	506
Basic earnings per share attributable to Eastman	$	2.01	$	1.73		$	3.91		$	3.43
Diluted earnings per share attributable to Eastman	$	2.00	$	1.71		$	3.89		$	3.40

Comprehensive Income
Net earnings including noncontrolling interest	$	294		$	257		$	573		$	508
Other comprehensive income (loss), net of tax:
Change in cumulative translation adjustment	36			(70		)	43			36
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits included in net periodic costs	(6		)	(7		)	(13		)	(14		)
Derivatives and hedging:
Unrealized gain (loss) during period	(18		)	38			(39		)	20
Reclassification adjustment for losses included in net income, net	8			33			4			37
Total other comprehensive income (loss), net of tax	20			(6		)	(5		)	79
Comprehensive income including noncontrolling interest	314			251			568			587
Less: Comprehensive income attributable to noncontrolling interest	2			2			3			2
Comprehensive income attributable to Eastman	$	312		$	249		$	565		$	585
Retained Earnings
Retained earnings at beginning of period	$	5,925		$	5,330		$	5,721		$	5,146
Net earnings attributable to Eastman	292			255			570			506
Cash dividends declared	(75		)	(68		)	(149		)	(135		)
Retained earnings at end of period	$	6,142		$	5,517		$	6,142		$	5,517

The accompanying notes are an integral part of these consolidated financial statements.

4

UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

	June 30,			December 31,
(Dollars in millions, except per share amounts)	2017			2016
Assets
Current assets
Cash and cash equivalents	$	222		$	181
Trade receivables, net of allowance for doubtful accounts	1,018			812
Miscellaneous receivables	419			399
Inventories	1,540			1,404
Other current assets	63			70
Total current assets	3,262			2,866
Properties
Properties and equipment at cost	11,966			11,699
Less:  Accumulated depreciation	6,563			6,423
Net properties	5,403			5,276
Goodwill	4,507			4,461
Intangible assets, net of accumulated amortization	2,433			2,469
Other noncurrent assets	359			385
Total assets	$	15,964		$	15,457
Liabilities and Stockholders' Equity
Current liabilities
Payables and other current liabilities	$	1,384		$	1,512
Borrowings due within one year	212			283
Total current liabilities	1,596			1,795
Long-term borrowings	6,669			6,311
Deferred income tax liabilities	1,286			1,206
Post-employment obligations	1,004			1,018
Other long-term liabilities	519			519
Total liabilities	11,074			10,849
Stockholders' equity
Common stock ($0.01 par value – 350,000,000 shares authorized; shares issued – 218,274,450 and 217,707,600 for 2017 and 2016, respectively)	2			2
Additional paid-in capital	1,954			1,915
Retained earnings	6,142			5,721
Accumulated other comprehensive income (loss)	(286		)	(281		)
	7,812			7,357
Less: Treasury stock at cost (73,446,150 shares for 2017 and 71,269,474 shares for 2016)	3,000			2,825
Total Eastman stockholders' equity	4,812			4,532
Noncontrolling interest	78			76
Total equity	4,890			4,608
Total liabilities and stockholders' equity	$	15,964		$	15,457

The accompanying notes are an integral part of these consolidated financial statements.

5

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

	First Six Months
(Dollars in millions)	2017			2016
Operating activities
Net earnings	$	573		$	508
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	292			291
Early debt extinguishment costs	—			9
Gain on sale of equity investment	—			(17		)
Provision for deferred income taxes	36			47
Changes in operating assets and liabilities, net of effect of acquisitions and divestitures:
(Increase) decrease in trade receivables	(166		)	(151		)
(Increase) decrease in inventories	(108		)	41
Increase (decrease) in trade payables	(28		)	(76		)
Pension and other postretirement contributions (in excess of) less than expenses	(56		)	(51		)
Variable compensation (in excess of) less than expenses	(34		)	(67		)
Other items, net	(26		)	11
Net cash provided by operating activities	483			545
Investing activities
Additions to properties and equipment	(279		)	(234		)
Proceeds from sale of assets	1			41
Acquisitions, net of cash acquired	(4		)	(22		)
Other items, net	(1		)	3
Net cash used in investing activities	(283		)	(212		)
Financing activities
Net increase (decrease) in commercial paper and other borrowings	(95		)	(208		)
Proceeds from borrowings	500			807
Repayment of borrowings	(250		)	(807		)
Dividends paid to stockholders	(149		)	(136		)
Treasury stock purchases	(175		)	(45		)
Dividends paid to noncontrolling interest	(1		)	(4		)
Proceeds from stock option exercises and other items, net	12			8
Net cash used in financing activities	(158		)	(385		)
Effect of exchange rate changes on cash and cash equivalents	(1		)	(1		)
Net change in cash and cash equivalents	41			(53		)
Cash and cash equivalents at beginning of period	181			293
Cash and cash equivalents at end of period	$	222		$	240

The accompanying notes are an integral part of these consolidated financial statements.

6

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

ITEM		Page
Note 1.	Basis of Presentation	8
Note 2.	Inventories	8
Note 3.	Payables and Other Current Liabilities	8
Note 4.	Provision for Income Taxes	9
Note 5.	Borrowings	9
Note 6.	Derivative and Non-Derivative Financial Instruments	11
Note 7.	Retirement Plans	15
Note 8.	Commitments and Off Balance Sheet Arrangements	16
Note 9.	Environmental Matters and Asset Retirement Obligations	18
Note 10.	Legal Matters	19
Note 11.	Stockholders' Equity	19
Note 12.	Earnings and Dividends Per Share	21
Note 13.	Asset Impairments and Restructuring	22
Note 14.	Share-Based Compensation Awards	23
Note 15.	Supplemental Cash Flow Information	23
Note 16.	Segment Information	24
Note 17.	Recently Issued Accounting Standards	25

7

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared by Eastman Chemical Company ("Eastman" or the "Company") in accordance and consistent with the accounting policies stated in the Company's 2016 Annual Report on Form 10-K and should be read in conjunction with the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K. The December 31, 2016 financial position data included herein was derived from the audited consolidated financial statements included in the 2016 Annual Report on Form 10-K but does not include all disclosures required by accounting principles generally accepted in the United States ("GAAP").

In the opinion of management, the unaudited consolidated financial statements include all normal recurring adjustments necessary for fair presentation of the interim financial information in conformity with GAAP. These statements contain some amounts that are based upon management estimates and judgments. Future actual results could differ from such current estimates. The unaudited consolidated financial statements include assets, liabilities, sales revenue, and expenses of all majority-owned subsidiaries and joint ventures in which a controlling interest is maintained. Eastman accounts for other joint ventures and investments where it exercises significant influence on the equity basis. Intercompany transactions and balances are eliminated in consolidation. Certain prior period data has been reclassified in the consolidated financial statements and accompanying footnotes to conform to current period presentation.

2. INVENTORIES

	June 30,		December 31,
(Dollars in millions)	2017		2016
Finished goods	$	1,103	$	997
Work in process	220		198
Raw materials and supplies	478		473
Total inventories at FIFO or average cost	1,801		1,668
Less: LIFO reserve	261		264
Total inventories	$	1,540	$	1,404

Inventories valued on the last-in, first-out ("LIFO") method were approximately 60 percent of total inventories at both June 30, 2017 and December 31, 2016.

3. PAYABLES AND OTHER CURRENT LIABILITIES

	June 30,		December 31,
(Dollars in millions)	2017		2016
Trade creditors	$	675	$	704
Accrued payrolls, vacation, and variable-incentive compensation	125		196
Accrued taxes	90		106
Post-employment obligations	84		110
Derivative hedging liability	82		72
Other	328		324
Total payables and other current liabilities	$	1,384	$	1,512

The "Other" above consists primarily of accruals for dividends payable, interest payable, the current portion of environmental liabilities, and miscellaneous accruals.

8

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

4. PROVISION FOR INCOME TAXES

	Second Quarter								First Six Months
(Dollars in millions)	2017				2016				2017				2016
	$		%		$		%		$		%		$		%
Provision for income taxes and tax rate	$	65	18	%	$	67	21	%	$	127	18	%	$	139	22	%

The second quarter and first six months2017 effective tax rates include a $22 million tax benefit to reflect finalization of prior years' income tax returns. The first six months2017 effective tax rate also reflects a $22 million tax benefit due to planned amendments to prior years' income tax returns. The second quarter and first six months 2016 effective tax rates include a $16 million one-time benefit for the restoration of tax basis for which depreciation deductions were previously limited. The first six months 2016 effective tax rate also reflects a $9 million tax benefit primarily due to adjustments to the tax provision to reflect the finalization of 2014 foreign income tax returns.

5. BORROWINGS

	June 30,		December 31,
(Dollars in millions)	2017		2016
Borrowings consisted of:
5.5% notes due November 2019	$	250	$	249
2.7% notes due January 2020	796		796
4.5% notes due January 2021	184		184
3.6% notes due August 2022	739		741
1.50% notes due May 2023 (1)	852		786
7 1/4% debentures due January 2024	197		197
7 5/8% debentures due June 2024	43		43
3.8% notes due March 2025	690		689
1.875% notes due November 2026(1)	563		519
7.60% debentures due February 2027	195		195
4.8% notes due September 2042	493		493
4.65% notes due October 2044	871		870
Credit facilities borrowings	799		549
Commercial paper borrowings	200		280
Capital leases and other	9		3
Total borrowings	6,881		6,594
Borrowings due within one year	212		283
Long-term borrowings	$	6,669	$	6,311

⁽¹⁾  The carrying value of the euro-denominated 1.50% notes due May 2023 and 1.875% notes due November 2026 will fluctuate with changes in the euro exchange rate. The carrying value of these euro-denominated borrowings have been designated as non-derivative net investment hedges of a portion of the Company's net investments in euro functional-currency denominated subsidiaries to offset foreign currency fluctuations. During the six months endedJune 30, 2017 and 2016, pre-tax losses of $109 million and gains of $3 million, respectively, were recognized in "Other comprehensive income (loss)" ("OCI") for revaluation of these notes.

9

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Credit Facility and Commercial Paper Borrowings

In December 2014, Eastman borrowed $1 billion under a five-year term loan ("2019 Term Loan"). As of June 30, 2017 and December 31, 2016, the 2019 Term Loan agreement balance outstanding was $250 million with an interest rate of 2.48 percent and 2.02 percent, respectively. In December 2016, the Company borrowed $300 million under a second five-year term loan ("2021 Term Loan"). As of June 30, 2017 and December 31, 2016, the 2021 Term Loan agreement balance outstanding was $299 million with an interest rate of 2.48 percent and 1.95 percent, respectively. Borrowings under the 2019 Term Loan and 2021 Term Loan agreements are subject to interest at varying spreads above quoted market rates.

The Company has access to a $1.25 billion revolving credit agreement (the "Credit Facility") that expires October 2021. Borrowings under the Credit Facility are subject to interest at varying spreads above quoted market rates and a commitment fee is paid on the total unused commitment. The Credit Facility provides liquidity support for commercial paper borrowings and general corporate purposes. Commercial paper borrowings are classified as short-term. At June 30, 2017 and December 31, 2016, the Company had no outstanding borrowings under the Credit Facility. At June 30, 2017, the Company's commercial paper borrowings were $200 million with a weighted average interest rate of 1.44 percent. At December 31, 2016, the Company's commercial paper borrowings were $280 million with a weighted average interest rate of 1.12 percent.

The Company has access to a $250 million accounts receivable securitization agreement (the "A/R Facility") that expires April 2019. Eastman Chemical Financial Corporation ("ECFC"), a subsidiary of the Company, has an agreement to sell interests in trade receivables under the A/R Facility to a third party purchaser. Third party creditors of ECFC have first priority claims on the assets of ECFC before those assets would be available to satisfy the Company's general obligations. Borrowings under the A/R Facility are subject to interest rates based on a spread over the lender's borrowing costs, and ECFC pays a fee to maintain availability of the A/R Facility. At December 31, 2016, the Company had no borrowings under the A/R Facility. At June 30, 2017, the Company's borrowings under the A/R Facility were $250 million supported by trade receivables with an interest rate of 1.98%.

The Credit and A/R Facilities and other borrowing arrangements contain customary covenants and events of default, some of which require the Company to maintain certain financial ratios that determine the amounts available and terms of borrowings. The Company was in compliance with all covenants at both June 30, 2017 and December 31, 2016.

Fair Value of Borrowings

The Company has classified its long-term borrowings at June 30, 2017 and December 31, 2016, under the fair value hierarchy as defined in the accounting policies in Note 1, "Significant Accounting Policies", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K. The fair value for fixed-rate debt securities is based on current market prices and is classified as Level 1. The fair value for the Company's other borrowings under the Term Loans and the A/R Facility equals the carrying value and is classified as Level 2. The Company had no borrowings classified as Level 3 as of June 30, 2017 and December 31, 2016.

			Fair Value Measurements at June 30, 2017
(Dollars in millions)	Recorded Amount June 30, 2017		Total Fair Value		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)
Long-term borrowings	$	6,669	$	7,069	$	6,273	$	796

			Fair Value Measurements at December 31, 2016
(Dollars in millions)	Recorded Amount December 31, 2016		Total Fair Value		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)
Long-term borrowings	$	6,311	$	6,586	$	6,036	$	550

10

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

6. DERIVATIVE AND NON-DERIVATIVE FINANCIAL INSTRUMENTS

Overview of Hedging Programs

The Company is exposed to market risks, such as changes in foreign currency exchange rates, commodity prices, and interest rates. To mitigate these market risks and their effects on the cash flows of the underlying transactions and investments in foreign subsidiaries, the Company uses various derivative and non-derivative financial instruments, when appropriate, in accordance with the Company's hedging strategy and policies. Designation is performed on a specific exposure basis to support hedge accounting. The Company does not enter into derivative transactions for speculative purposes.  

For further information on hedging programs, see Note 10, "Derivative and Non-Derivative Financial Instruments", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K.

Cash Flow Hedges

Cash flow hedges are derivative instruments designated as and used to hedge the exposure to variability in expected future cash flows that are attributable to a particular risk. The derivative instruments that are designated and qualify as a cash flow hedge are reported on the balance sheet at fair value and the changes in fair value of these hedging instruments are offset in part or in whole by corresponding changes in the anticipated cash flows of the underlying exposures being hedged. The net of the change in the hedge instrument and item being hedged for qualifying cash flow hedges is reported as a component of "Accumulated other comprehensive income (loss)" ("AOCI") located in the Unaudited Consolidated Statements of Financial Position and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivatives representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings.

Fair Value Hedges

Fair value hedges are defined as derivative or non-derivative instruments designated as and used to hedge the exposure to changes in the fair value of an asset or a liability or an identified portion thereof that is attributable to a particular risk. The derivative instruments that are designated and qualify as fair value hedges are reported on the balance sheet at fair value and the changes in fair value of these hedging instruments are offset in part or in whole by corresponding changes in the anticipated cash flows of the underlying exposures being hedged. The net of the change in the hedge instrument and item being hedged for qualifying fair value hedges is reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivatives representing hedge ineffectiveness are recognized in current earnings.

In second quarter 2016, the Company entered into a fixed-to-floating interest rate swap on a portion of the 3.8% notes due March 2025 to manage the Company's mix of fixed and variable rate debt.

Net Investment Hedges

Net investment hedges are defined as derivative or non-derivative instruments designated as and used to hedge the foreign currency exposure of net investments in certain foreign operations. The net of the change in the hedge instrument and item being hedged for qualifying net investment hedges is reported as a component of "Change in cumulative translation adjustment" within AOCI located in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings. Gains and losses representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. The foreign currency-denominated borrowings designated as net investment hedges are included as part of "Long-term borrowings'" within the Unaudited Consolidated Statements of Financial Position.

11

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The Company designated the euro-denominated 1.50% notes due May 2023 in the principal amounts of €200 million ($213 million) in fourth quarter 2016 and €550 million ($614 million) in second quarter 2016 and the euro-denominated 1.875% notes due November 2026 in the principal amount of €500 million ($534 million) in fourth quarter 2016 as non-derivative net investment hedges of a portion of the Company's net investments in euro functional currency-denominated subsidiaries to offset foreign currency fluctuations.

Summary of Financial Position and Financial Performance of Hedging Instruments

The following table shows the notional amounts outstanding atJune 30, 2017 and December 31, 2016associated with the Company's hedging programs.

Notional Outstanding		June 30, 2017	December 31, 2016
Derivatives designated as cash flow hedges:
Foreign Exchange Forward and Option Contracts (in millions)
	EUR/USD (in EUR)	€360	€378
	EUR/USD (in approximate USD equivalent)	$411	$398
	JPY/USD (in JPY)	¥900	¥1,800
	JPY/USD (in approximate USD equivalent)	$8	$15
Commodity Forward and Collar Contracts
	Feedstock (in million barrels)	10	11
	Energy (in million million british thermal units)	20	23
Derivatives designated as fair value hedges:
Fixed-for-floating interest rate swaps (in millions)		$75	$75
Non-derivatives designated as net investment hedges:
Foreign Currency Net Investment Hedges (in millions)
	EUR/USD (in EUR)	€1,239	€1,238

Fair Value Measurements

All the Company's derivative assets and liabilities are currently classified as Level 2 with fair values based on estimates using standard pricing models. These standard pricing models use inputs which are derived from or corroborated by observable market data such as interest rate yield curves and currency spot and forward rates. The fair value of commodity contracts is derived using forward curves supplied by an industry recognized and unrelated third party. In addition, on an ongoing basis, the Company tests a subset of its valuations against valuations received from the transaction's counterparty to validate the accuracy of its standard pricing models. Counterparties to these derivative contracts are highly rated financial institutions which the Company believes carry minimal risk of nonperformance. The Company diversifies its positions among such counterparties to reduce its exposure to counterparty risk and credit losses and monitors the creditworthiness of its counterparties on an on-going basis. The Company had no credit losses during second quarter and first six months2017 and 2016.

For additional fair value measurement information, see Note 1, "Significant Accounting Policies", and Note 10, "Derivative and Non-Derivative Financial Instruments", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K.

12

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The following table shows the financial assets and liabilities valued on a gross basis as ofJune 30, 2017 and December 31, 2016. Additionally, the table below indicates where the derivatives are reported on the Unaudited Consolidated Statements of Financial Position. During the periods presented, there were no transfers between fair value hierarchy levels.

The Financial Position and Fair Value Measurements of Hedging Instruments on a Gross Basis
(Dollars in millions)
Derivative Type	Statements of Financial Position Classification	June 30, 2017 Level 2		December 31, 2016 Level 2
Derivatives designated as cash flow hedges:
Commodity contracts	Other current assets	$	1	$	5
Commodity contracts	Other noncurrent assets	—		2
Foreign exchange contracts	Other current assets	35		49
Foreign exchange contracts	Other noncurrent assets	16		47
Derivatives designated as fair value hedges:
Fixed-for-floating interest rate swap	Other current assets	1		1
Total Derivative Assets		$	53	$	104
Derivatives designated as cash flow hedges:
Commodity contracts	Payables and other current liabilities	$	75	$	62
Commodity contracts	Other long-term liabilities	58		69
Foreign exchange contracts	Payables and other current liabilities	1		—
Foreign exchange contracts	Other long-term liabilities	1		—
Derivatives designated as fair value hedges:
Fixed-for-floating interest rate swap	Long-term borrowings	3		4
Total Derivative Liabilities		$	138	$	135
Total Net Derivative Liabilities		$	85	$	31

In addition to the fair value associated with derivative instruments designated as cash flow hedges and fair value hedges noted in the table above, the Company had a carrying value of $1.4 billion and $1.3 billion associated with non-derivative instruments designated as foreign currency net investment hedges at June 30, 2017 and December 31, 2016, respectively. The designated foreign currency-denominated borrowings are included in the "Long-term borrowings" line item of the Unaudited Consolidated Statements of Financial Position.

All the Company's derivative contracts are subject to master netting arrangements, or similar agreements, which provide for the option to settle contracts on a net basis when they settle on the same day and in the same currency. In addition, these arrangements provide for a net settlement of all contracts with a given counterparty in the event that the arrangement is terminated due to the occurrence of default or a termination event. The Company has elected to present the derivative contracts on a gross basis in the Unaudited Consolidated Statements of Financial Position. If the Company presented the derivatives contracts on a net basis, there would be no material difference in asset and liability positions. The Company does not have any cash collateral due under such agreements.

13

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The tables below present the effect of hedging instruments on OCI and the financial performance for second quarter and first six months2017 and 2016:

(Dollars in millions)	Change in amount of after tax gain/(loss) recognized in OCI on derivatives (effective portion)						Pre-tax amount of gain/(loss) reclassified from Accumulated OCI into income (effective portion)						Additional pre-tax gain/(loss) recognized in earnings (effective portion)
	Second Quarter						Second Quarter						Second Quarter
Hedging Relationships	2017			2016			2017			2016			2017		2016		Income Statement Classification
Derivatives in cash flow hedging relationships:
Commodity contracts	$	9		$	79		$	(20	)	$	(65	)	$	—	$	—	Cost of sales
Foreign exchange contracts	(20		)	1			10			15			—		—		Sales
Forward starting interest rate and treasury lock swap contracts	1			(9		)	(1		)	(2		)	—		—		Net interest expense
Derivatives in fair value hedging relationships:
Fixed-for-floating interest rate swaps	—			—			—			—			1		3		Net interest expense
Non-derivatives in net investment hedging relationships:
Net investment hedges (pre-tax)	(91		)	3			—			—			—		—		N/A
Derivatives not designated as hedges: (1)
Foreign Exchange Contracts	—			—			—			—			10		23		Other (income) charges, net

⁽¹⁾  The gains or losses on derivatives that are not designated as hedges are marked to market and represent foreign exchange derivatives denominated in multiple currencies and are transacted and settled in the same quarter.

14

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions)	Change in amount of after tax gain/(loss) recognized in OCI on derivatives (effective portion)						Pre-tax amount of gain/(loss) reclassified from Accumulated OCI into income (effective portion)						Additional pre-tax gain/(loss) recognized in earnings (effective portion)
	First Six Months						First Six Months						First Six Months
Hedging Relationships	2017			2016			2017			2016			2017		2016		Income Statement Classification
Derivatives in cash flow hedging relationships:
Commodity contracts	$	(7	)	$	109		$	(27	)	$	(85	)	$	—	$	—	Cost of sales
Foreign exchange contracts	(30		)	(25		)	22			30			—		—		Sales
Forward starting interest rate and treasury lock swap contracts	2			(27		)	(2		)	(4		)	—		—		Net interest expense
Derivatives in fair value hedging relationships:
Fixed-for-floating interest rate swaps	—			—			—			—			2		7		Net interest expense
Non-derivatives in net investment hedging relationships:
Net investment hedges (pre-tax)	(109		)	3			—			—			—		—		N/A
Derivatives not designated as hedges: (1)
Foreign Exchange Contracts	—			—			—			—			4		14		Other (income) charges, net

⁽¹⁾  The gains or losses on derivatives that are not designated as hedges are marked to market and represent foreign exchange derivatives denominated in multiple currencies and are transacted and settled in the same quarter.

Pre-tax monetized positions and mark-to-market gains and losses from raw materials and energy, currency, and certain interest rate hedges that were included in AOCI included losses of $223 million at June 30, 2017 and losses of $57 million at December 31, 2016. Losses in AOCI increased June 30, 2017 compared to December 31, 2016 primarily as a result of an increase in foreign currency exchange rates, particularly the euro. If realized, approximately $43 million in pre-tax losses, as of June 30, 2017, will be reclassified into earnings during the next 12 months.

Any ineffectiveness from the hedging programs are immediately recognized in earnings. The Company had no material ineffectiveness from the hedging programs during second quarter and first six months2017 and 2016.

7. RETIREMENT PLANS

Defined Benefit Pension Plans and Other Postretirement Benefit Plans

Eastman maintains defined benefit pension plans that provide eligible employees with retirement benefits. In addition, Eastman provides life insurance for eligible retirees hired prior to January 1, 2007. Eastman provides a subsidy for pre-Medicare health care and dental benefits to eligible retirees hired prior to January 1, 2007 that will end on December 31, 2021. Company funding is also provided for eligible Medicare retirees hired prior to January 1, 2007 with a health reimbursement arrangement. Costs recognized for these benefits are estimated amounts, which may change as actual costs derived for the year are determined.

For additional information regarding retirement plans, see Note 11, "Retirement Plans", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K.

15

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Components of net periodic benefit (credit) cost were as follows:

	Second Quarter
	Pension Plans												Other Postretirement Benefit Plans
	2017						2016						2017			2016
(Dollars in millions)	U.S.			Non-U.S.			U.S.			Non-U.S.
Components of net periodic benefit (credit) cost:
Service cost	$	9		$	4		$	10		$	3		$	1		$	1
Interest cost	16			4			19			6			6			7
Expected return on assets	(35		)	(9		)	(34		)	(8		)	(1		)	(1		)
Amortization of:
Prior service credit, net	(1		)	—			(1		)	—			(10		)	(10		)
Net periodic benefit (credit) cost	$	(11	)	$	(1	)	$	(6	)	$	1		$	(4	)	$	(3	)
	First Six Months
	Pension Plans												Other Postretirement Benefit Plans
	2017						2016						2017			2016
(Dollars in millions)	U.S.			Non-U.S.			U.S.			Non-U.S.
Components of net periodic benefit (credit) cost:
Service cost	$	18		$	7		$	20		$	6		$	2		$	3
Interest cost	33			9			37			12			12			14
Expected return on assets	(70		)	(17		)	(68		)	(16		)	(3		)	(3		)
Amortization of:
Prior service credit, net	(2		)	—			(2		)	—			(20		)	(20		)
Net periodic benefit (credit) cost	$	(21	)	$	(1	)	$	(13	)	$	2		$	(9	)	$	(6	)

8. COMMITMENTS AND OFF BALANCE SHEET ARRANGEMENTS

Purchase Obligations and Lease Commitments

The Company had various purchase obligations at June 30, 2017, totaling approximately $2.9 billion over a period of approximately 30 years for materials, supplies, and energy incident to the ordinary conduct of business. The Company also had various lease commitments for property and equipment under cancelable, noncancelable, and month-to-month operating leases totaling $295 million over a period of approximately 40 years. Of the total lease commitments, approximately 45 percent relate to real property, including office space, storage facilities, and land; approximately 45 percent relate to railcars; and approximately 10 percent relate to machinery and equipment, including computer and communications equipment and production equipment.

Guarantees

The Company has operating leases with terms that require the Company to guarantee a portion of the residual value of the leased assets upon termination of the lease as well as other guarantees. Disclosures about each group of similar guarantees are provided below.

16

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Residual Value Guarantees

The Company has operating leases with terms that require the Company to guarantee a portion of the residual value of the leased assets upon termination of the lease. These residual value guarantees totaled $71 million at June 30, 2017 and consist primarily of leases for railcars that will expire beginning in third quarter 2018. Residual guarantee payments that become probable and estimable are recognized as rent expense over the remaining life of the applicable lease. Management's current expectation is that the likelihood of material residual guarantee payments is remote.

Other Guarantees

Guarantees and claims also arise during the ordinary course of business from relationships with customers, suppliers, joint venture partners, and other parties when the Company undertakes an obligation to guarantee the performance of others if specified triggering events occur. Non-performance under a contract could trigger an obligation of the Company. The Company's current other guarantees include guarantees relating to intellectual property, environmental matters, and other indemnifications and have arisen through the normal course of business. The ultimate effect on future financial results is not subject to reasonable estimation because considerable uncertainty exists as to the final outcome of these claims, if they were to occur. These other guarantees have terms up to 30 years with maximum potential future payments of approximately $35 million in the aggregate, with none of these guarantees being individually significant to the Company's operating results, financial position, or liquidity. Management's current expectation is that future payment or performance related to non-performance under other guarantees is remote.

Other Off Balance Sheet Arrangements

The Company has rights and obligations under non-recourse factoring facilities that have a combined limit of €150 million ($171 million) as of June 30, 2017 and are committed until December 2017. These arrangements include receivables in the United States, Belgium, and Finland, and are subject to various eligibility requirements. The Company sells the receivables at face value but receives funding (approximately 85 percent) net of a deposit amount until collections are received from customers for the receivables sold. The total amounts of cumulative receivables sold in second quarter and first six months 2017, were approximately $250 million and $500 million, respectively. The total amounts of cumulative receivables sold in second quarter and first six months 2016, were approximately $225 million and $460 million, respectively. As part of the program, the Company continues to service the sold receivables at market rates with no servicing assets or liabilities recognized. The amounts of sold receivables outstanding under the non-recourse factoring facilities were $122 million and $99 million at June 30, 2017 and December 31, 2016, respectively. The fair value of the receivables sold equals the carrying value at the time of the sale, and no gain or loss is recognized. The Company is exposed to a credit loss of up to 10 percent on sold receivables.

17

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

9. ENVIRONMENTAL MATTERS AND ASSET RETIREMENT OBLIGATIONS

Certain Eastman manufacturing sites generate hazardous and nonhazardous wastes, the treatment, storage, transportation, and disposal of which are regulated by various governmental agencies. In connection with the cleanup of various hazardous waste sites, the Company, along with many other entities, has been designated a potentially responsible party ("PRP") by the U.S. Environmental Protection Agency under the Comprehensive Environmental Response, Compensation and Liability Act, which potentially subjects PRPs to joint and several liability for such cleanup costs. In addition, the Company will incur costs for environmental remediation and closure and post-closure under the federal Resource Conservation and Recovery Act. Reserves for environmental contingencies have been established in accordance with Eastman's policies described in Note 1, "Significant Accounting Policies", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K. Although the resolution of uncertainties related to these environmental matters may have a material adverse effect on the Company's consolidated results of operations in the period recognized, because of the availability of legal defenses, the Company's preliminary assessment of actions that may be required, and if applicable the expected sharing of costs, management does not believe that the Company's liability for these environmental matters, individually or in the aggregate, will be material to the Company's consolidated financial position or cash flows. The Company's total reserve for environmental contingencies was $318 million and $321 million at June 30, 2017 and December 31, 2016, respectively. At both June 30, 2017 and December 31, 2016, this reserve included $8 million related to sites previously closed and impaired by Eastman and sites that have been divested by Eastman but for which the Company retains the environmental liability related to these sites.

The Company's total environmental reserve that management believes to be probable and estimable for environmental contingencies, including remediation costs and asset retirement obligations, is included as part of "Payables and other current liabilities" and "Other long-term liabilities" in the Unaudited Consolidated Statements of Financial Position as follows:

(Dollars in millions)	June 30, 2017		December 31, 2016
Environmental contingent liabilities, current	$	30	$	30
Environmental contingent liabilities, long-term	288		291
Total	$	318	$	321

Remediation

Estimated future environmental expenditures for undiscounted remediation costs ranged from the best estimate or minimum of $291 million to the maximum of $500 million and from the best estimate or minimum of $295 million to the maximum of $503 million at June 30, 2017 and December 31, 2016, respectively. The estimated future costs are considered to be reasonably possible and include the amounts recognized at both June 30, 2017 and December 31, 2016.

Reserves for environmental remediation include liabilities expected to be paid within approximately 30 years. The amounts charged to pre-tax earnings for environmental remediation and related charges are included within "Cost of sales" in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings. Changes in the reserves for environmental remediation liabilities during first six months 2017 are summarized below:

(Dollars in millions)	Environmental Remediation Liabilities
Balance at December 31, 2016	$	295
Changes in estimates recognized in earnings and other	5
Cash reductions	(9		)
Balance at June 30, 2017	$	291

18

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Closure/Post-Closure

An asset retirement obligation is an obligation for the retirement of a tangible long-lived asset that is incurred upon the acquisition, construction, development, or normal operation of that long-lived asset. The Company recognizes asset retirement obligations in the period in which they are incurred if a reasonable estimate of fair value can be made. The asset retirement obligations are discounted to expected present value and subsequently adjusted for changes in fair value. The associated estimated asset retirement costs are capitalized as part of the carrying value of the long-lived assets and depreciated over their useful life. Environmental asset retirement obligations consist primarily of closure and post-closure costs. For sites that have environmental asset retirement obligations, the best estimate recognized to date over the sites estimated useful lives for these environmental asset retirement obligation costs was $27 million and $26 million at June 30, 2017 and December 31, 2016, respectively. 

Other

The Company has contractual asset retirement obligations not associated with environmental liabilities. Eastman's non-environmental asset retirement obligations are primarily associated with the future closure of leased manufacturing assets at Pace, Florida and Oulu, Finland. These recognized non-environmental asset retirement obligations were $47 million and $46 million at June 30, 2017 and December 31, 2016, respectively.

10. LEGAL MATTERS

From time to time, the Company and its operations are parties to, or targets of, lawsuits, claims, investigations and proceedings, including product liability, personal injury, asbestos, patent and intellectual property, commercial, contract, environmental, antitrust, health and safety, and employment matters, which are being handled and defended in the ordinary course of business. While the Company is unable to predict the outcome of these matters, it does not believe, based upon currently available facts, that the ultimate resolution of any such pending matters will have a material adverse effect on its overall financial condition, results of operations, or cash flows.

11. STOCKHOLDERS' EQUITY

A reconciliation of the changes in stockholders' equity for first six months 2017 is provided below:

(Dollars in millions)	Common Stock at Par Value		Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock at Cost			Total Stockholders' Equity Attributed to Eastman			Noncontrolling Interest			Total Stockholders' Equity
Balance at December 31, 2016	$	2	$	1,915		$	5,721		$	(281	)	$	(2,825	)	$	4,532		$	76		$	4,608
Net Earnings	—		—			570			—			—			570			3			573
Cash Dividends Declared (1) ($1.02 per share)	—		—			(149		)	—			—			(149		)	—			(149		)
Other Comprehensive Income	—		—			—			(5		)	—			(5		)	—			(5		)
Share-Based Compensation Expense (2)	—		27			—			—			—			27			—			27
Stock Option Exercises	—		17			—			—			—			17			—			17
Other	—		(5		)	—			—			—			(5		)	(1		)	(6		)
Share Repurchases	—		—			—			—			(175		)	(175		)	—			(175		)
Balance at June 30, 2017	$	2	$	1,954		$	6,142		$	(286	)	$	(3,000	)	$	4,812		$	78		$	4,890

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

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

19

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Accumulated Other Comprehensive Income (Loss), Net of Tax

(Dollars in millions)	Cumulative Translation Adjustment			Benefit Plans Unrecognized Prior Service Credits			Unrealized Gains (Losses) on Derivative Instruments			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	43			(13		)	(35		)	—			(5		)
Balance at June 30, 2017	$	(338	)	$	150		$	(97	)	$	(1	)	$	(286	)

Amounts of other comprehensive income (loss) are presented net of applicable taxes. The Company recognizes 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 such cumulative translation adjustment is considered to be a component of indefinitely invested, unremitted earnings of these foreign subsidiaries.

Components of other comprehensive income recognized in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings are presented below, before tax and net of tax effects:

	Second Quarter
	2017						2016
(Dollars in millions)	Before Tax			Net of Tax			Before Tax			Net of Tax
Other comprehensive income (loss)
Change in cumulative translation adjustment	$	36		$	36		$	(70	)	$	(70	)
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits included in net periodic costs (1)	(11		)	(6		)	(11		)	(7		)
Derivatives and hedging: (2)
Unrealized gain (loss) during period	(28		)	(18		)	62			38
Reclassification adjustment for losses included in net income, net	13			8			53			33
Total other comprehensive income (loss)	$	10		$	20		$	34		$	(6	)

20

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

	First Six Months
	2017						2016
(Dollars in millions)	Before Tax			Net of Tax			Before Tax			Net of Tax
Other comprehensive income (loss)
Change in cumulative translation adjustment	$	43		$	43		$	36		$	36
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits included in net periodic costs (1)	(22		)	(13		)	(22		)	(14		)
Derivatives and hedging: (2)
Unrealized gain (loss) during period	(62		)	(39		)	32			20
Reclassification adjustment for losses included in net income, net	7			4			60			37
Total other comprehensive income (loss)	$	(34	)	$	(5	)	$	106		$	79

⁽¹⁾  Included in the calculation of net periodic benefit costs for pension and other postretirement benefit plans. See Note 7, "Retirement Plans".

⁽²⁾  For additional information regarding the impact of reclassifications into earnings, see Note 6, "Derivative and Non-Derivative Financial Instruments".

12. EARNINGS AND DIVIDENDS PER SHARE

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

	Second Quarter				First Six Months
(In millions, except per share amounts)	2017		2016		2017		2016
Numerator
Earnings attributable to Eastman:
Earnings, net of tax	$	292	$	255	$	570	$	506
Denominator
Weighted average shares used for basic EPS	145.3		147.8		145.7		147.8
Dilutive effect of stock options and other awards	1.1		1.1		1.1		1.1
Weighted average shares used for diluted EPS	146.4		148.9		146.8		148.9
(Calculated using whole dollars and shares)
EPS
Basic	$	2.01	$	1.73	$	3.91	$	3.43
Diluted	$	2.00	$	1.71	$	3.89	$	3.40

21

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

In second quarter and first six months2017 options to purchase 850,970 and 1,008,667 shares of common stock, respectively, were excluded from the shares treated as outstanding for computation of diluted earnings per share because the total market value of option exercises for these awards was less than the total cash proceeds that would be received for these exercises. Second quarter and first six months2017 reflect the impact of share repurchases of 1,232,977 and 2,176,676, respectively.

In second quarter and first six months2016, options to purchase 1,056,961 and 1,076,935 shares of common stock, respectively, were excluded from the shares treated as outstanding for computation of diluted earnings per share because the total market value of option exercises for these awards was less than the total cash proceeds that would be received for these exercises. Second quarter and first six months2016 reflect the impact of share repurchases of 344,790 and 632,071, respectively.

The Company declared cash dividends of $0.51 and $0.46 per share in second quarter2017 and 2016, respectively, and $1.02 and $0.92 per share in first six months2017 and 2016, respectively.

13. ASSET IMPAIRMENTS AND RESTRUCTURING

In second quarter and first six months 2017, there were no asset impairment and restructuring charges. In first six months 2016, there was a gain of $2 million in the Additives & Functional Products segment for the sale of previously impaired assets at the Crystex^® insoluble sulfur research and development site in France.

Changes in Reserves for Asset Impairments, Restructuring Charges, Net, and Severance Charges

The following table summarizes the changes in asset impairments and restructuring charges and gains, the non-cash reductions attributable to asset impairments, and the cash reductions in restructuring reserves for severance costs and site closure costs paid in first six months2017 and full year 2016:

(Dollars in millions)	Balance at January 1, 2017		Provision/ Adjustments		Non-cash Reductions/ Additions		Cash Reductions			Balance at June 30, 2017
Severance costs	$	42	$	—	$	—	$	(22	)	$	20
Site closure and restructuring costs	13		—		1		(2		)	12
Total	$	55	$	—	$	1	$	(24	)	$	32

(Dollars in millions)	Balance at January 1, 2016		Provision/ Adjustments		Non-cash Reductions/ Additions			Cash Reductions			Balance at December 31, 2016
Non-cash charges	$	—	$	12	$	(12	)	$	—		$	—
Severance costs	55		32		—			(45		)	42
Site closure and restructuring costs	11		1		4			(3		)	13
Total	$	66	$	45	$	(8	)	$	(48	)	$	55

Substantially all severance costs remaining are expected to be applied to the reserves within one year.

22

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

14. SHARE-BASED COMPENSATION AWARDS

The Company utilizes share-based awards under employee and non-employee director compensation programs. These share-based awards may include restricted and unrestricted stock, restricted stock units, stock options, and performance shares. In second quarter2017 and 2016, $13 million and $7 million, respectively, of compensation expense before tax were recognized in "Selling, general and administrative expenses" in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings for all share-based awards. The impact on second quarter2017 and 2016 net earnings of $8 million and $4 million, respectively, is net of deferred tax expense related to share-based award compensation for each period.

In first six months2017 and 2016, $27 million and $20 million, respectively, of compensation expense before tax were recognized in "Selling, general and administrative expenses" in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings for all share-based awards. The impact on first six months2017 and 2016 net earnings of $17 million and $12 million, respectively, is net of deferred tax expense related to share-based award compensation for each period.

For additional information regarding share-based compensation plans and awards, see Note 18, "Share-Based Compensation Plans and Awards", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K.

15. SUPPLEMENTAL CASH FLOW INFORMATION

Included in the line item "Other items, net" of the "Operating activities" section of the Unaudited Consolidated Statements of Cash Flows are the following changes to Unaudited Consolidated Statement of Financial Position:

(Dollars in millions)	First Six Months
	2017			2016
Other current assets	$	(3	)	$	(13	)
Other noncurrent assets	7			14
Payables and other current liabilities	(30		)	40
Long-term liabilities and equity	—			(30		)
Total	$	(26	)	$	11

The above changes resulted primarily from accrued taxes, deferred taxes, environmental liabilities, monetized positions from raw material and energy, currency, and certain interest rate hedges, prepaid insurance, miscellaneous deferrals, value-added taxes, and other miscellaneous accruals.

23

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

16. SEGMENT INFORMATION

The Company's products and operations are managed and reported in four operating segments: Additives & Functional Products ("AFP"), Advanced Materials ("AM"), Chemical Intermediates ("CI"), and Fibers. For additional financial and product information for each segment, see Part 1, Item 1, Business -- Business Segments and Part II, Item 8, Note 20, "Segment Information", in the Company's 2016 Annual Report on Form 10-K.

	Second Quarter				First Six Months
(Dollars in millions)	2017		2016		2017		2016
Sales
Additives & Functional Products	$	830	$	770	$	1,603	$	1,507
Advanced Materials	657		646		1,291		1,235
Chemical Intermediates	703		633		1,373		1,253
Fibers	215		234		428		514
Total Sales by Segment	2,405		2,283		4,695		4,509
Other	14		14		27		24
Total Sales	$	2,419	$	2,297	$	4,722	$	4,533

	Second Quarter						First Six Months
(Dollars in millions)	2017			2016			2017			2016
Operating Earnings (Loss)
Additives & Functional Products	$	159		$	168		$	311		$	321
Advanced Materials	137			132			258			240
Chemical Intermediates	83			15			165			82
Fibers	55			72			107			158
Total Operating Earnings by Segment	434			387			841			801
Other
Growth initiatives and businesses not allocated to segments	(32		)	(24		)	(60		)	(42		)
Pension and other postretirement benefits income, net not allocated to operating segments	18			13			36			25
Acquisition integration and transaction costs	—			—			—			(9		)
Total Operating Earnings	$	420		$	376		$	817		$	775

24

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

	June 30,		December 31,
(Dollars in millions)	2017		2016
Assets by Segment (1)
Additives & Functional Products	$	6,497	$	6,255
Advanced Materials	4,382		4,247
Chemical Intermediates	2,997		2,927
Fibers	950		920
Total Assets by Segment	14,826		14,349
Corporate Assets	1,138		1,108
Total Assets	$	15,964	$	15,457

⁽¹⁾  Segment assets include accounts receivable, inventory, fixed assets, goodwill, and intangible assets. Segment asset balances for shared fixed assets within the CI and Fibers segments as of December 31, 2016 have been reclassified to conform to current period allocation methodology.

17. RECENTLY ISSUED ACCOUNTING STANDARDS

In May 2014, the Financial Accounting Standards Board ("FASB") and International Accounting Standards Board jointly issued new principles-based accounting guidance for revenue recognition that provides a five-step process to the principles-based guidance. In August 2015, the FASB issued new guidance to delay the effective date of the new revenue standard by one year. The deferral results in the new revenue standard being effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early application is permitted under the original effective date of fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. In April 2016, the FASB issued clarifying guidance to the 2014 revenue standard in regard to the identification of performance obligations and licensing. In May 2016, the FASB issued narrow-scope improvements and practical expedients to the new revenue standard that include clarification of the collectability criterion, specification for the measurement of noncash considerations, clarifies a completed contract for transition purposes and clarification in regards to the retrospective application, as well as, policy elections, and other practical expedients. In December 2016, the FASB issued additional corrections and improvements that affect various narrow aspects of the guidance. The effective date for all amendments is the same as that of the revenue standard stated above. Management does not expect that changes in its accounting required by this new guidance will materially impact the Company's financial statements and related disclosures. Management plans to adopt the new guidance January 1, 2018, and anticipates adopting retrospectively to each prior reporting period presented with the election of applicable practical expedients.

In February 2016, the FASB issued guidance on lease accounting. The new guidance establishes two types of leases for lessees: finance and operating. Both finance and operating leases will have associated right-of-use assets and liabilities initially measured at the present value of the lease payments. This guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period and early adoption is permitted. The new guidance is to be applied under a modified retrospective approach wherein practical expedients have been allowed that will not require reassessment of current leases at the effective date. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

In June 2016, the FASB issued guidance relating to credit losses. The amendments require a financial asset (including trade receivables) to be presented at the net amount expected to be collected through the use of allowances for credit losses valuation account. The income statement will reflect the measurement of credit losses for newly recognized financial assets, as well as the expected increases or decreases of expected credit losses that have taken place during the period. This guidance is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period and early adoption is permitted, including adoption in an interim period, beginning after December 15, 2018. The new guidance application is mixed among the various elements that include modified retrospective and prospective transition methods. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

25

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

In October 2016, the FASB issued guidance as a part of its simplification initiative in regards to income tax of intra-entity asset transfers. The release requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. Consequently, the amendments eliminate the exception for an intra-entity transfer of an asset other than inventory that prohibited recognizing current and deferred income tax consequences for an intra-entity asset transfer until the asset or assets have been sold to an outside party. This guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods and early adoption is permitted as of the beginning of an annual reporting period for which financial statements (interim or annual) have not been issued or made available for issuance. The new guidance is to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

In January 2017, the FASB issued guidance clarifying the definition of a business that provides a two-step analysis in the determination of whether an acquisition or derecognition is a business or an asset. The update removes the evaluation of whether a market participant could replace any missing elements and provides a framework to assist entities in evaluating whether both an input and a substantive process are present. This guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods and early adoption is permitted for transactions that meet specified criteria. This guidance is to be applied on a prospective basis for transactions that occur after the effective date.

In January 2017, the FASB issued guidance as a part of its simplification initiative that bases the impairment of goodwill on any difference for which the carrying value is greater than the fair value of the reporting unit. This guidance is effective for annual reporting periods, or interim period testing performed, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment testing performed after January 1, 2017. This guidance is to be applied on a prospective basis for goodwill testing that occur after the effective date.

In February 2017, the FASB issued guidance that clarifies the scope of nonfinancial asset derecognition and the accounting for partial sales of nonfinancial assets. This guidance is effective at the same time as the amendments in the revenue recognition standard stated above, for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, and must be applied in conjunction with that standard. Adoption can be applied either on a retrospective or modified retrospective approach. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

In March 2017, the FASB issued guidance to improve the presentation of net periodic pension and postretirement benefit costs that will require the reporting of the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost (interest cost, expected return on plan assets, curtailment gains or losses, amortization of prior service costs or credits, and mark-to-market gains or losses) are to be presented in the income statement separately from the service cost component and outside the subtotal of income from operations. In addition, the amendment prescribes only the service cost component to be eligible for capitalization. This guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods and early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. The new guidance is to be applied retrospectively for income statement effect and prospectively for balance sheet effects. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

In May 2017, the FASB issued guidance to clarify when changes to the terms or conditions of a share-based payment award would require an entity to apply modification accounting. This guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period, for reporting periods for which financial statements have not yet been issued. The new guidance is to be applied prospectively to an award modified on or after the adoption date.

26

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM	Page
Critical Accounting Estimates	27
Non-GAAP Financial Measures	28
Overview	32
Results of Operations	33
Summary by Operating Segment	37
Sales by Customer Location	40
Liquidity, Capital Resources, and Other Financial Information	41
Recently Issued Accounting Standards	42
2017 Outlook	43
Risk Factors	43

This Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is based upon the consolidated financial statements of Eastman Chemical Company ("Eastman" or the "Company"), which have been prepared in accordance with accounting principles generally accepted ("GAAP") in the United States, and should be read in conjunction with the Company's audited consolidated financial statements, including related notes, and MD&A contained in the Company's 2016 Annual Report on Form 10-K, the Company's unaudited consolidated financial statements, including related notes, included elsewhere in this Quarterly Report on Form 10-Q. All references to earnings per share ("EPS") contained in this report are diluted EPS unless otherwise noted.

CRITICAL ACCOUNTING ESTIMATES

In preparing the consolidated financial statements in conformity with GAAP, the Company's management must make decisions which impact the reported amounts and the related disclosures. Such decisions include the selection of the appropriate accounting principles to be applied and assumptions on which to base estimates and judgments that affect the reported amounts of assets, liabilities, sales revenue and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, the Company evaluates its estimates, including those related to impairment of long-lived assets, environmental costs, pension and other postretirement benefits, litigation and contingent liabilities, and income taxes. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The Company's management believes the critical accounting estimates described in Part II, Item 7 of the Company's 2016 Annual Report on Form 10-K are the most important to the fair presentation of the Company's financial condition and results. These estimates require management's most significant judgments in the preparation of the Company's consolidated financial statements.

27

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

NON-GAAP FINANCIAL MEASURES

Non-GAAP financial measures, and the accompanying reconciliations of the non-GAAP financial measures to the most comparable GAAP measures, are presented in "Overview", "Results of Operations", "Summary by Operating Segment", and "2017 Outlook" in this MD&A.

Company Use of Non-GAAP Financial Measures

Non-Core Items and any Unusual or Non-Recurring Items

In addition to evaluating the Company's financial condition, results of operations, liquidity, and cash flows as reported in accordance with GAAP, Eastman management also evaluates Company and operating segment performance, and makes resource allocation and performance evaluation decisions, excluding the effect of transactions, costs, and losses or gains that do not directly arise from Eastman's normal, or "core", business and operations, or are otherwise of an unusual or non-recurring nature. These transactions, costs, and losses or gains relate to, among other things, cost reductions, growth and profitability improvement initiatives, and other events outside of core business operations (such as asset impairments and restructuring charges and gains, costs of and related to acquisitions, gains and losses from and costs related to dispositions of businesses, financing transaction costs, and mark-to-market losses or gains for pension and other postretirement benefit plans). Because non-core, unusual, or non-recurring transactions, costs, and losses or gains may materially affect the Company's, or any particular operating segment's, financial condition or results in a specific period in which they are recognized, Eastman believes it is appropriate to evaluate both the financial measures prepared and calculated in accordance with GAAP and the related non-GAAP financial measures excluding the effect on our results of these non-core, unusual, or non-recurring items. In addition to using such measures to evaluate results in a specific period, management evaluates such non-GAAP measures, and believes that investors may also evaluate such measures, because such measures may provide more complete and consistent comparisons of the Company's, and its segments', operational performance on a period-over-period historical basis and, as a result, provide a better indication of expected future trends.

Adjusted Tax Rate and Provision for Income Taxes

In first quarter 2017, the Company began disclosing non-GAAP earnings with an adjusted effective tax rate and a resulting adjusted provision for income taxes using the Company's current forecasted tax rate for the full year. The adjusted effective tax rate and resulting adjusted provision for income taxes are equal to the Company's projected full year effective tax rate and provision for income taxes on earnings excluding non-core items for completed periods. The adjusted effective tax rate and resulting adjusted provision for income taxes may fluctuate during the year for changes in events and circumstances that change the Company's forecasted annual effective tax rate and resulting provision for income taxes excluding non-core items. Management discloses this adjusted effective tax rate, and the related reconciliation to the GAAP effective tax rate, to provide investors more complete and consistent comparisons of the Company's operational performance on a period-over-period interim basis and on the same basis as management evaluates quarterly financial results to provide a better indication of expected full year results. The Company did not forecast a full year effective tax rate or provision for income taxes on this basis in prior periods and, accordingly, is not presenting an adjusted effective tax rate or provision for income taxes for periods prior to first quarter 2017.

Management discloses these non-GAAP measures, and the related reconciliations to the most comparable GAAP financial measures, because it believes investors use these metrics in evaluating longer term period-over-period performance, and to allow investors to better understand and evaluate the information used by management to assess the Company's, and its operating segments', performances, make resource allocation decisions and evaluate organizational and individual performances in determining certain performance-based compensation. Non-GAAP measures do not have definitions under GAAP, and may be defined differently by, and not be comparable to, similarly titled measures used by other companies. As a result, management cautions investors not to place undue reliance on any non-GAAP measure, but to consider such measures with the most directly comparable GAAP measure.

28

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Non-GAAP Measures in this Quarterly Report

The non-core items excluded by management in its evaluation of certain results in this Quarterly Report are described, and these non-core items and adjustments to provision for income taxes are quantified, below:

• Asset impairments and restructuring gains, net, of which asset impairments are non-cash transactions impacting profitability;

• Acquisition integration and transaction costs;

• Early debt extinguishment costs resulting from repayment of $500 million of the 2.4% notes due June 2017;

• Cost of disposition of claims against operations that were discontinued by Solutia, Inc., ("Solutia") prior to the Company's acquisition of Solutia in 2012; and

• Gain from the sale of the Company's 50 percent interest in the Primester joint venture.

Excluded Non-Core Items and Adjustments to Provision for Income Taxes

	Second Quarter								First Six Months
(Dollars in millions)	2017				2016				2017				2016
Non-core items impacting operating earnings:
Asset impairments and restructuring gains, net	$	—			$	—			$	—			$	(2	)
Acquisition integration and transaction costs	—				—				—				9
Total non-core items impacting operating earnings	—				—				—				7
Non-core items impacting earnings before income taxes:
Early debt extinguishment costs	—				9				—				9
Cost of disposition of claims against discontinued Solutia operations	—				—				—				5
Gain from sale of equity investment in Primester joint venture	—				(17		)		—				(17		)
Total non-core items impacting earnings before income taxes	—			—	(8		)	—	—			—	(3		)
Less: Items impacting provision for income taxes:
Tax effect for non-core items	—				(3		)		—				5
Adjustment to tax provision	3				—				12
Total items impacting provision for income taxes	3				(3		)		12				5
Total items impacting net earnings attributable to Eastman	$	(3	)		$	(5	)		$	(12	)		$	(1	)

29

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

This MD&A includes an analysis of the effect of the foregoing on the following GAAP financial measures:

• Selling, general and administrative ("SG&A") expenses,

• Operating earnings,

• Other (income) charges, net,

• Provision for income taxes,

• Net earnings attributable to Eastman, and

• Diluted earnings per share.

Other Non-GAAP Financial Measures

Alternative Non-GAAP Cash Flow Measures

In addition to the non-GAAP measures presented in this Quarterly Report and other periodic reports, from time to time management evaluates and discloses to investors and securities analysts the non-GAAP measure cash provided by operating activities excluding certain non-core, unusual, or non-recurring items ("cash provided by operating activities, as adjusted") when analyzing, among other things, business performance, liquidity and financial position, and performance-based compensation. Management uses this non-GAAP measure in conjunction with the GAAP measure cash provided by operating activities because it believes it is a more appropriate metric to evaluate the cash flows from Eastman's core operations that are available for organic and inorganic growth initiatives and because it allows for a more consistent period-over-period presentation of such amounts. In its evaluation, management generally excludes the impact of certain non-core activities and decisions of management because such activities and decisions are not considered core, ongoing components of operations and the decisions to undertake or not to undertake such activities may be made irrespective of the cash generated from operations. From time to time, management discloses this non-GAAP measure and the related reconciliation to investors and securities analysts to allow them to better understand and evaluate the information used by management in its decision-making processes and because management believes investors and securities analysts use similar measures to assess Company performance, liquidity, and financial position over multiple periods and to compare these with other companies.

Similarly, from time to time, Eastman may disclose to investors and securities analysts an alternative non-GAAP measure of "free cash flow", which management defines as cash provided by operating activities, as adjusted, described above, less the amount of capital expenditures. Management believes such items are generally funded from available cash and, as such, should be considered in determining free cash flow. Management believes this is an appropriate metric to assess the Company's ability to fund priorities for uses of cash. The priorities for cash after funding operations include payment of quarterly dividends, additional repayment of debt, inorganic growth opportunities, and from time to time repurchasing shares. Management believes this metric is useful to investors and securities analysts in order to provide them with information similar to that used by management in evaluating financial performance and potential future cash available for various initiatives and assessing organizational performance in determining certain performance-based compensation and because management believes investors and securities analysts often use a similar measure of free cash flow to compare the results, and value, of comparable companies. In addition, Eastman may disclose to investors and securities analysts an alternative non-GAAP measure of "free cash flow yield", which management defines as annual free cash flow divided by the Company's market capitalization. Management believes this metric is useful to investors and securities analysts in comparing cash flow generation with that of peer and other companies.

30

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Alternative Non-GAAP Earnings Measures

From time to time, Eastman may also disclose to investors and securities analysts the non-GAAP earnings measures "Adjusted EBITDA", "EBITDA Margin", and "Return on Invested Capital" (or "ROIC"). Management defines Adjusted EBITDA as EBITDA (net earnings or net earnings per share before interest, taxes, depreciation and amortization) adjusted to exclude the same non-core, unusual, and non-recurring items as are excluded from the Company's other non-GAAP earnings measures for the same periods. EBITDA Margin is Adjusted EBITDA divided by the GAAP measure sales revenue in the Company's income statement for the same periods. Management defines ROIC as net income plus interest expense after tax divided by average total borrowings plus average stockholders' equity for the periods presented, each derived from the GAAP measures in the Company's financial statements for the periods presented. Management believes that Adjusted EBITDA, EBITDA Margin, and ROIC are useful as supplemental measures in evaluating the performance of and returns from Eastman's operating businesses, and from time to time uses such measures in internal performance calculations. Further, management understands that investors and securities analysts often use similar measures of Adjusted EBITDA, EBITDA Margin, and ROIC to compare the results, returns, and value of the Company with those of other companies.

31

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

The Company's products and operations are managed and reported in four operating segments: Additives & Functional Products ("AFP"), Advanced Materials ("AM"), Chemical Intermediates ("CI"), and Fibers. Eastman is focused on consistent earnings growth through a market-driven approach that takes advantage of the Company's existing technology platforms, global market and manufacturing presence, and leading positions in key end markets such as transportation, building and construction, and consumables. Management believes that the Company's end-market diversity is a source of strength, and that many of the markets into which the Company's products are sold are benefiting from longer-term global trends such as energy efficiency, a rising middle class in emerging economies, and an increased focus on health and wellness. Management believes that these trends, combined with the diversity of the Company's end markets, facilitate more consistent demand for the Company's products over time.

The Company generated sales revenue of $2.4 billion and $2.3 billion in second quarter2017 and 2016, respectively, and sales revenue of $4.7 billion and $4.5 billion in first six months 2017 and 2016, respectively. Sales revenue increased $122 million and $189 million in second quarter and first six months2017 compared to second quarter and first six months2016, respectively, as increases in the CI, AFP, and AM segments were partially offset by a decline in the Fibers segment.

Operating earnings were $420 million in second quarter2017 compared with $376 million in second quarter2016. Operating earnings increased in second quarter2017 as increases in the CI and AM segments more than offset a decline in the Fibers and AFP segments.

Operating earnings were $817 million in first six months2017 compared with $775 million in first six months2016. Excluding the non-core items identified in "Non-GAAP Financial Measures", operating earnings in first six months2017 and 2016 were $817 million and $782 million, respectively. Adjusted operating earnings increased in first six months2017 as increases in the CI and AM segments more than offset a decline in the Fibers and AFP segments.

Net earnings attributable to Eastman and EPS and adjusted net earnings and EPS were as follows:

	Second Quarter
	2017					2016
(Dollars in millions, except diluted EPS)	$			EPS		$			EPS
Net earnings attributable to Eastman	$	292		$	2.00	$	255		$	1.71
Total non-core items, net of tax (1)	—					(5		)
Adjustment to tax provision (1)	(3		)			—
Adjusted net earnings	$	289		$	1.98	$	250		$	1.68
	First Six Months
	2017					2016
(Dollars in millions, except diluted EPS)	$			EPS		$			EPS
Net earnings attributable to Eastman	$	570		$	3.89	$	506		$	3.40
Total non-core items, net of tax (1)	—					(1		)
Adjustment to tax provision (1)	(12		)			—
Adjusted net earnings	$	558		$	3.80	$	505		$	3.39

⁽¹⁾  See "Results of Operations - Provision for Income Taxes" for adjusted provision for income taxes for second quarter and first six months 2017 and the tax effected amount of total non-core items for second quarter and first six months 2016.

The Company generated $483 million in cash from operating activities in first six months2017.

32

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

Sales

	Second Quarter									First Six Months
					Change									Change
(Dollars in millions)	2017		2016		$			%		2017		2016		$			%
Sales	$	2,419	$	2,297	$	122		5	%	$	4,722	$	4,533	$	189		4	%
Volume / product mix effect					70			3	%					146			3	%
Price effect					75			3	%					84			2	%
Exchange rate effect					(23		)	(1	)%					(41		)	(1	)%

Sales revenue increased $122 million and $189 million in second quarter and first six months2017 compared to second quarter and first six months2016, respectively, as increases in the CI, AFP, and AM segments were partially offset by a decline in the Fibers segment.

Gross Profit

	Second Quarter						First Six Months
(Dollars in millions)	2017		2016		Change		2017		2016		Change
Gross Profit	$	651	$	605	8	%	$	1,276	$	1,239	3	%

Gross profit increased in second quarter and first six months2017 compared with second quarter and first six months2016 as increases in the CI and AM segments more than offset a decline in the Fibers and AFP segments. Gross profit in 2017 includes the benefit of lower labor and manufacturing costs from corporate cost reduction actions taken in 2016.

Selling, General and Administrative Expenses

	Second Quarter						First Six Months
(Dollars in millions)	2017		2016		Change		2017		2016			Change
Selling, General and Administrative Expenses	$	176	$	174	1	%	$	350	$	357		(2	)%
Acquisition integration and transaction costs	—		—				—		(9		)
Selling, General and Administrative Expenses excluding non-core items	$	176	$	174	1	%	$	350	$	348		1	%

Included in first six months 2016 SG&A expenses were transaction costs for final resolution of the 2011 Sterling Chemicals, Inc. acquisition purchase price and integration costs for the Commonwealth Laminating & Coating, Inc. ("Commonwealth") business acquired in December 2014.

Research and Development Expenses

	Second Quarter						First Six Months
(Dollars in millions)	2017		2016		Change		2017		2016		Change
Research and Development Expenses	$	55	$	55	—	%	$	109	$	109	—	%

33

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Asset Impairments and Restructuring

	Second Quarter				First Six Months
(Dollars in millions)	2017		2016		2017		2016
Gain on sale of assets	$	—	$	—	$	—	$	(2	)
Total	$	—	$	—	$	—	$	(2	)

In first six months 2016 there was a gain of $2 million in the AFP segment for the sale of previously impaired assets at the Crystex^® insoluble sulfur research and development ("R&D") site in France.

For more information regarding asset impairments and restructuring charges and gains see Note 13, "Asset Impairments and Restructuring", to the Company's unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Operating Earnings

	Second Quarter						First Six Months
(Dollars in millions)	2017		2016		Change		2017		2016			Change
Operating earnings	$	420	$	376	12	%	$	817	$	775		5	%
Asset impairments and restructuring gains, net	—		—				—		(2		)
Acquisition integration and transaction costs	—		—				—		9
Operating earnings excluding non-core items	$	420	$	376	12	%	$	817	$	782		4	%

Net Interest Expense

	Second Quarter						First Six Months
(Dollars in millions)	2017		2016		Change		2017		2016		Change
Gross interest costs	$	70	$	73			$	138	$	146
Less: Capitalized interest	1		2				3		5
Interest expense	69		71		(3	)%	135		141		(4	)%
Less: Interest income	8		8				14		14
Net interest expense	$	61	$	63	(3	)%	$	121	$	127	(5	)%

Net interest expense decreased in second quarter and first six months2017 compared with second quarter and first six months2016 as a result of the refinancing in 2016 of certain outstanding public debt with proceeds of the sale of new debt securities and term loan borrowings.

Early Debt Extinguishment Costs

On May 26, 2016, the Company sold euro-denominated 1.50% notes due 2023 in the principal amount of €550 million ($614 million). Proceeds from the sale of the notes, net of transaction costs, were used for the early repayment of $500 million of the 2.4% notes due June 2017 and repayment of other borrowings. The early repayment resulted in a charge of $9 million for early debt extinguishment costs primarily attributable to the early redemption premium and related unamortized costs. For additional information regarding the early extinguishment costs, see Note 9, "Borrowings", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K.

34

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Other (Income) Charges, Net

	Second Quarter						First Six Months
(Dollars in millions)	2017			2016			2017			2016
Foreign exchange transaction (gains) losses, net	$	3		$	3		$	2		$	14
(Income) loss from equity investments and other investment (gains) losses, net	(4		)	(4		)	(7		)	(6		)
Gain from sale of equity investment in Primester joint venture	—			(17		)	—			(17		)
Other, net	1			(2		)	1			1
Other (income) charges, net	$	—		$	(20	)	$	(4	)	$	(8	)
Cost of disposition of claims against discontinued Solutia operations	—			—			—			(5		)
Gain from sale of equity investment in Primester joint venture	—			17			—			17
Other (income) charges, net excluding non-core item	$	—		$	(3	)	$	(4	)	$	4

Included in other (income) charges, net are losses or gains on foreign exchange transactions, equity investments, business venture investments, and non-operating assets. First six months2016 foreign exchange transaction (gains) losses, net, included the revaluation of foreign entity assets and liabilities losses partially offset by gains from certain derivative instruments, both items impacted primarily by the euro. See Note 6, "Derivative and Non-Derivative Financial Instruments", to the Company's unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Second quarter and first six months2016 other (income) charges, net included a gain of $17 million from the sale of the Company's interest in the Primester joint venture equity investment. For additional information, see Note 6, "Equity Investments", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K. First six months2016 other (income) charges, net also included cost of disposition of claims against operations that were discontinued by Solutia prior to the Company's acquisition of Solutia in 2012.

Provision for Income Taxes

	Second Quarter									First Six Months
	2017				2016					2017				2016
(Dollars in millions)	$		%		$			%		$		%		$		%
Provision for income taxes and effective tax rate	$	65	18	%	$	67		21	%	$	127	18	%	$	139	22	%
Tax provision for non-core items (1)	—				(3		)			—				5
Adjustment to tax provision (2) (3)	3				—					12				—
Adjusted provision for income taxes and effective tax rate	$	68	19	%	$	64		20	%	$	139	20	%	$	144	22	%

⁽¹⁾  Provision for income taxes for non-core items is calculated using the tax rate for the jurisdiction where the gains are taxable and the expenses are deductible.

⁽²⁾  Second quarter 2017 provision for income taxes was adjusted to reflect the current forecasted full year effective tax rate.

⁽³⁾  The adjusted provision for income taxes for first six months 2017 is calculated applying the forecasted full year effective tax rate as shown below.

35

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

	First Six Months
	2017
Effective tax rate	18	%
Discrete tax items (1)	3	%
Forecasted full year impact of expected tax events	(1	)%
Forecasted full year effective tax rate	20	%

⁽¹⁾  "Discrete tax items" are items that are excluded from a company's estimated annual effective tax rate and recognized entirely in the quarter in which the item occurs. First six months 2017 discrete items consist of planned amendments to and finalization of prior years' income tax returns.

Net Earnings and Diluted Earnings per Share

	Second Quarter				First Six Months
	2017				2017
(Dollars in millions, except diluted EPS)	$		EPS		$		EPS
Net earnings and diluted earnings per share attributable to Eastman	$	292	$	2.00	$	570	$	3.89
Less: Adjustment to tax provision	3				12
Adjusted net earnings and diluted earnings per share	$	289	$	1.98	$	558	$	3.80

	Second Quarter					First Six Months
	2016					2016
(Dollars in millions, except diluted EPS)	$			EPS		$			EPS
Net earnings and diluted earnings per share attributable to Eastman	$	255		$	1.71	$	506		$	3.40
Non-core items:
Asset impairments and restructuring gains, net	—					(2		)
Acquisition integration and transaction costs	—					9
Early debt extinguishment costs	9					9
Cost of disposition of claims against discontinued Solutia operations	—					5
Gain from sale of equity investment in Primester joint venture	(17		)			(17		)
Total non-core items	(8		)			4
Less: Tax effect for non-core items	(3		)			5
Adjusted net earnings and diluted earnings per share	$	250		$	1.68	$	505		$	3.39

36

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

SUMMARY BY OPERATING SEGMENT

The Company's products and operations are managed and reported in four operating segments: Additives & Functional Products ("AFP"), Advanced Materials ("AM"), Chemical Intermediates ("CI"), and Fibers. For additional financial and product information for each segment, see Part 1, Item 1, Business - Business Segments and Part II, Item 8, Note 20, "Segment Information", in the Company's 2016 Annual Report on Form 10-K.

Additives & Functional Products Segment

	Second Quarter									First Six Months
					Change										Change
(Dollars in millions)	2017		2016		$			%		2017		2016			$			%
Sales	$	830	$	770	$	60		8	%	$	1,603	$	1,507		$	96		6	%
Volume / product mix effect					55			7	%						113			7	%
Price effect					17			2	%						4			—	%
Exchange rate effect					(12		)	(1	)%						(21		)	(1	)%
Operating earnings	$	159	$	168	$	(9	)	(5	)%	$	311	$	321		$	(10	)	(3	)%
Asset impairments and restructuring gains, net	—		—		—					—		(2		)	2
Operating earnings excluding non-core item	$	159	$	168	$	(9	)	(5	)%	$	311	$	319		$	(8	)	(3	)%

Sales revenue in second quarter2017 increased compared to second quarter2016 due to higher sales volume, primarily of the care chemicals additives, specialty fluids, and tire additives products and higher selling prices, primarily for care chemicals additives and coatings and inks additives products. Sales revenue in first six months2017 increased compared to first six months2016 due to higher sales volume across the segment.

Operating earnings in first six months2016 included a $2 million gain for the sale of previously impaired assets at the Crystex^® insoluble sulfur R&D site in France. Operating earnings decreased in second quarter2017 and first six months2017 compared to second quarter2016 and first six months2016 as higher raw material and energy costs more than offset higher selling prices by $31 million and $56 million, respectively. The decrease was partially offset by higher sales volume of $17 million and $41 million, respectively.

Advanced Materials Segment

	Second Quarter									First Six Months
					Change									Change
(Dollars in millions)	2017		2016		$			%		2017		2016		$			%
Sales	$	657	$	646	$	11		2	%	$	1,291	$	1,235	$	56		5	%
Volume / product mix effect					15			3	%					73			6	%
Price effect					2			—	%					(6		)	—	%
Exchange rate effect					(6		)	(1	)%					(11		)	(1	)%
Operating earnings	$	137	$	132	$	5		4	%	$	258	$	240	$	18		8	%

37

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Sales revenue in second quarter and first six months2017 increased compared to second quarter and first six months2016 primarily due to higher sales volume across the segment, including of premium products such as Eastman Tritan^® copolyester, Saflex^® acoustic interlayers, and automotive performance films.

Operating earnings in second quarter2017 increased compared to second quarter2016 primarily due to the combined impact of higher sales volume and lower unit costs due to higher capacity utilization of $15 million, and lower scheduled maintenance costs of $4 million. These items were partially offset by higher raw material and energy costs of $18 million.

Operating earnings in first six months2017 increased compared to first six months2016 primarily due to the combined impact of higher sales volume, lower unit costs due to higher capacity utilization, and improved product mix of premium products of $54 million. The increase was partially offset by higher raw material and energy costs and lower selling prices of $33 million.

Chemical Intermediates Segment

	Second Quarter									First Six Months
					Change									Change
(Dollars in millions)	2017		2016		$			%		2017		2016		$			%
Sales	$	703	$	633	$	70		11	%	$	1,373	$	1,253	$	120		10	%
Volume / product mix effect					(5		)	(1	)%					(9		)	(1	)%
Price effect					80			13	%					137			11	%
Exchange rate effect					(5		)	(1	)%					(8		)	—	%
Operating earnings	$	83	$	15	$	68		453	%	$	165	$	82	$	83		101	%

Sales revenue in second quarter and first six months2017 increased compared to second quarter and first six months2016 due to higher selling prices attributed to higher raw material prices and continued improvement in competitive conditions.

Operating earnings increased in second quarter and first six months2017 compared to second quarter and first six months2016 primarily due to the reduced negative impact of hedges of commodity prices on raw material costs, primarily for propane, of $35 million and $46 million, respectively, and lower scheduled maintenance costs of $18 million and $15 million, respectively.

Fibers Segment

	Second Quarter									First Six Months
					Change									Change
(Dollars in millions)	2017		2016		$			%		2017		2016		$			%
Sales	$	215	$	234	$	(19	)	(8	)%	$	428	$	514	$	(86	)	(17	)%
Volume / product mix effect					5			2	%					(34		)	(7	)%
Price effect					(24		)	(10	)%					(51		)	(10	)%
Exchange rate effect					—			—	%					(1		)	—	%
Operating earnings	$	55	$	72	$	(17	)	(24	)%	$	107	$	158	$	(51	)	(32	)%

38

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Sales revenue in second quarter2017 decreased compared to second quarter2016 primarily due to lower selling prices, particularly for acetate tow, attributed to lower industry capacity utilization rates.

Sales revenue in first six months2017 decreased compared to first six months2016 primarily due to lower selling prices and lower sales volume, particularly for acetate tow. Lower acetate tow selling prices were primarily due to lower industry capacity utilization rates. Lower acetate tow sales volume was attributed to reduced sales in China and customer buying patterns in first quarter 2017.

Operating earnings in second quarter2017 decreased compared to second quarter2016 primarily due to approximately $21 million of lower selling prices, partially offset by lower operating costs resulting from changes in segment business operations and assets.

Operating earnings in first six months2017 decreased compared to first six months2016 due to approximately $62 million of lower selling prices and first quarter 2017 lower sales volume, partially offset by lower operating costs resulting from changes in segment business operations and assets.

Other

	Second Quarter						First Six Months
(Dollars in millions)	2017			2016			2017			2016
Sales	$	14		$	14		$	27		$	24
Operating loss
Growth initiatives and businesses not allocated to segments	$	(32	)	$	(24	)	$	(60	)	$	(42	)
Pension and other postretirement benefits income, net not allocated to operating segments	18			13			36			25
Acquisition integration and transaction costs	—			—			—			(9		)
Operating loss before non-core items	(14		)	(11		)	(24		)	(26		)
Acquisition integration and transaction costs	—			—			—			9
Operating loss excluding non-core items	$	(14	)	$	(11	)	$	(24	)	$	(17	)

Sales revenue and costs related to growth initiatives, R&D costs, certain components of pension and other postretirement benefits, and other expenses and income not identifiable to an operating segment are not included in segment operating results for any of the periods presented and are shown in "Other". Sales revenue in second quarter and first six months2017 and second quarter and first six months2016 is primarily sales from the microfiber technology platform.

Included in first six months2016 operating losses were transaction costs for final resolution of the 2011 Sterling Chemicals, Inc. acquisition purchase price and integration costs for the Commonwealth business acquired in December 2014.

39

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

SALES BY CUSTOMER LOCATION

	Sales Revenue
	Second Quarter									First Six Months
					Change									Change
(Dollars in millions)	2017		2016		$			%		2017		2016		$			%
United States and Canada	$	1,088	$	1,030	$	58		6	%	$	2,154	$	2,036	$	118		6	%
Asia Pacific	581		530		51			10	%	1,093		1,025		68			7	%
Europe, Middle East, and Africa	624		603		21			3	%	1,224		1,215		9			1	%
Latin America	126		134		(8		)	(6	)%	251		257		(6		)	(2	)%
	$	2,419	$	2,297	$	122		5	%	$	4,722	$	4,533	$	189		4	%

Sales revenue in United States and Canada increased in second quarter and first six months2017 compared to second quarter and first six months2016, primarily due to higher CI segment selling prices.

Sales revenue in Asia Pacific increased in second quarter and first six months2017 compared to second quarter and first six months2016, primarily due to higher AFP and AM segments sales volume and higher CI segment selling prices partially offset by lower Fibers segment sales volume and lower Fibers and AFP segments selling prices.

Sales revenue in Europe, Middle East, and Africa increased in second quarter and first six months2017 compared to second quarter and first six months2016, primarily due to higher Fibers and AFP segments sales volume and higher AFP and CI segments selling prices, partially offset by an unfavorable shift in foreign currency exchange rates in all operating segments and lower Fibers segment selling prices.

Sales revenue in Latin America decreased in second quarter2017 compared to second quarter2016, primarily due to lower CI, Fibers, and AFP segments sales volume partially offset by higher CI segment selling prices.

Sales revenue in Latin America decreased in first six months2017 compared to first six months2016, primarily due to lower Fibers segment sales volume and lower Fibers and AM segments selling prices partially offset by higher AM segment sales volume.

40

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

LIQUIDITY, CAPITAL RESOURCES, AND OTHER FINANCIAL INFORMATION

Cash Flows

	First Six Months
(Dollars in millions)	2017			2016
Net cash provided by (used in)
Operating activities	$	483		$	545
Investing activities	(283		)	(212		)
Financing activities	(158		)	(385		)
Effect of exchange rate changes on cash and cash equivalents	(1		)	(1		)
Net change in cash and cash equivalents	41			(53		)
Cash and cash equivalents at beginning of period	181			293
Cash and cash equivalents at end of period	$	222		$	240

Cash provided by operating activities decreased $62 million in first six months 2017 compared with first six months 2016 primarily due to an increase in working capital primarily due to inventory, partially offset by higher earnings.

Cash used in investing activities increased $71 million in first six months2017 compared with first six months2016 primarily due to $45 million higher additions to properties and equipment as well as $40 million lower proceeds from the sale of assets.

Cash used in financing activities decreased $227 million in first six months2017 compared with first six months2016. The decrease was primarily due to an increase of $363 million in net proceeds from borrowings partially offset by increases in share repurchases and dividend payments of $143 million.

Liquidity and Capital Resources

The Company has access to a $1.25 billion revolving credit agreement (the "Credit Facility") that expires October 2021. Borrowings under the Credit Facility are subject to interest at varying spreads above quoted market rates and a commitment fee is paid on the total unused commitment. The Credit Facility provides liquidity support for commercial paper borrowings and general corporate purposes.

The Company also has access to a $250 million accounts receivable securitization agreement (the "A/R Facility") that expires April 2019. Eastman Chemical Financial Corporation ("ECFC"), a subsidiary of the Company, has an agreement to sell interests in trade receivables under the A/R Facility to a third party purchaser. Third party creditors of ECFC have first priority claims on the assets of ECFC before those assets would be available to satisfy the Company's general obligations. Borrowings under the A/R Facility are subject to interest rates based on a spread over the lender's borrowing costs, and ECFC pays a fee to maintain availability of the A/R Facility.

The Credit and A/R Facilities and other borrowing arrangements contain customary covenants and events of default, some of which require the Company to maintain certain financial ratios that determine the amounts available and terms of borrowings. The Company was in compliance with all covenants at both June 30, 2017 and December 31, 2016. The amount of available borrowings under the A/R and Credit Facilities was approximately $785 million as of June 30, 2017. The amount of available borrowings was limited by a financial ratio covenant under the Credit Facility and reduced by a seasonal increase in borrowings under the A/R and Credit Facilities. For additional information, see Section 5.03 of the Credit Facility at Exhibit 10.02 to the Company's 2016 Annual Report on Form 10-K.

Cash flows from operations, cash and cash equivalents, and other sources of liquidity are expected to be available and sufficient to meet foreseeable cash requirements. However, the Company's cash flows from operations can be affected by numerous factors including risks associated with global operations, raw material availability and cost, demand for and pricing of Eastman's products, capacity utilization, and other factors described under "Risk Factors" in this MD&A. Eastman management believes maintaining a financial profile consistent with an investment grade credit rating is important to its long-term strategic and financial flexibility.

41

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Debt and Other Commitments

At June 30, 2017, the Company's borrowings totaled $6.9 billion with various maturities. See Note 5, "Borrowings", to the Company's unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q. As of June 30, 2017, there have been no material changes to the Company's debt and other commitments at December 31, 2016. See "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's 2016 Annual Report on Form 10-K.

The resolution of uncertainties related to environmental matters included in other liabilities may have a material adverse effect on the Company's consolidated results of operations in the period recognized, however, because of expected sharing of costs, the availability of legal defenses, and the Company's preliminary assessment of actions that may be required, management does not believe that the Company's liability for these environmental matters, individually or in the aggregate, will be material to the Company's consolidated financial position or cash flows. See Note 1, "Significant Accounting Policies", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K for the Company's accounting policy for environmental costs and see Note 9, "Environmental Matters and Asset Retirement Obligations", to the Company's unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information regarding outstanding environmental matters and asset retirement obligations.

Off Balance Sheet Arrangements

For information about off balance sheet arrangements, see Note 8, "Commitments and Off Balance Sheet Arrangements", to the Company's unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q. Management's current expectation is that the likelihood of material residual guarantee payments or future payment or performance related to non-performance under other guarantees is remote.

Capital Expenditures

Capital expenditures were $279 million and $234 million in first six months2017 and 2016, respectively, primarily for AFP and AM segment expansions in Kuantan, Malaysia, an AM segment expansion of Eastman Tritan^® copolyester capacity in Kingsport, Tennessee, an AFP segment expansion of Specialty Ketones in Kingsport, Tennessee, and site modernization projects in Longview, Texas. The Company expects that 2017 capital spending will be approximately $575 million.

Stock Repurchases and Dividends

In February 2014, the Company's Board of Directors authorized repurchase of up to an additional $1 billion of the Company's outstanding common stock at such times, in such amounts, and on such terms, as determined to be in the best interests of the Company. As of June 30, 2017, a total of 8,718,866 shares have been repurchased under this authorization for a total amount of $673 million.

The Company's Board of Directors has declared a cash dividend of $0.51 during the third quarter 2017, payable on October 2, 2017 to stockholders of record on September 15, 2017.

Other

Eastman did not have any material relationships with unconsolidated entities or financial partnerships, including special purpose entities, for the purpose of facilitating off-balance sheet arrangements with contractually narrow or limited purposes. Thus, the Company is not materially exposed to any financing, liquidity, market, or credit risk related to any such relationships.

RECENTLY ISSUED ACCOUNTING STANDARDS

For information regarding the impact of recently issued accounting standards, see Note 17, "Recently Issued Accounting Standards", to the Company's unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

42

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

2017 OUTLOOK

Eastman is focused on consistent earnings growth through a market-driven approach that takes advantage of the Company's existing technology platforms, global market and manufacturing presence, leading positions in key end markets, vertically integrated manufacturing streams, and advantaged cost positions. This focus is supported by the Company's end-market and geographic diversity as it serves global markets with products that are used in original equipment manufacturing, after-market, and durable goods products in a variety of end markets, such as transportation, building and construction, and consumables.

Management expects continued slow global economic growth and challenges in the Fibers segment. Management expects that market prices for commodity products and raw material and energy costs will continue to be volatile, and will continue to evaluate and use pricing strategies to mitigate this volatility. The negative impact of our current commodity hedges is expected to continue to be less than in recent years. Management also expects the strength of the U.S. dollar to continue to have an overall negative impact on the Company's results, partially offset by hedging of foreign currencies, particularly the euro.

For 2017, management also expects:

• operating results to continue to benefit from organic growth and improved product mix from continued market adoption of specialty products;

• cost reduction actions to result in cost savings of approximately $100 million;

• cash generated by operating activities of approximately $1.6 billion;

• capital spending to be approximately $575 million; and

• priorities for uses of available cash in 2017 to include payment of the quarterly dividend, repayment of debt, funding targeted growth initiatives, and repurchasing shares. The Company expects to repay $350 million of debt in 2017.

Based on the foregoing expectations and assumptions, management expects adjusted 2017 earnings per share excluding non-core and any unusual or non-recurring items in the last two quarters of 2017 and assuming an actual tax rate for full-year 2017 equal to the adjusted tax rate detailed in "Results of Operations - Provision for Income Taxes" to be 10 to 12 percent higher than adjusted 2016 earnings per share of $6.76. The Company's 2017 financial results forecasts do not include non-core items (such as mark to market pension and other post-retirement benefit gains and losses) or any unusual or non-recurring items. Accordingly, management is unable to reconcile projected 2017 earnings excluding non-core and any unusual or non-recurring items to projected reported GAAP earnings without unreasonable efforts.

See "Risk Factors" below.

RISK FACTORS

In addition to the factors described elsewhere in this Quarterly Report, the following are the most significant known factors, risks, and uncertainties that could cause actual results to differ materially from those in the forward-looking statements made in this Quarterly Report and elsewhere from time to time. See "Forward-looking Statements".

Continued uncertain conditions in the global economy and the financial markets could negatively impact the Company.

Continued uncertain conditions in the global economy and global capital markets may adversely affect the Company's results of operations, financial condition, and cash flows. The Company's business and operating results were affected by the impact of the last global recession and its related impacts, such as, the credit market crisis, declining consumer and business confidence, fluctuating commodity prices, volatile exchange rates, and other challenges that affected the global economy. Continuing deterioration and weakness of the global economy and financial markets and uncertainty over timing and extent of recovery have adversely affected the Company's results of operations, financial condition, and cash flows. In addition, the Company's ability to access the credit and capital markets under attractive rates and terms could be constrained, which may negatively impact the Company's liquidity or ability to pursue certain growth initiatives.

43

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Volatility in costs for strategic raw material and energy commodities or disruption in the supply of these commodities could adversely affect our financial results.

The Company is reliant on certain strategic raw material and energy commodities for its operations and utilizes risk management tools, including hedging, as appropriate, to mitigate market fluctuations in raw material and energy costs. These risk mitigation measures cannot eliminate all exposure to market fluctuations and have, from time to time, reduced the positive impact of unexpected decreases of the market price of purchased raw materials. In addition, natural disasters, plant interruptions, changes in laws or regulations, war or other outbreak of hostilities or terrorism, and breakdown or degradation of transportation infrastructure used for delivery of strategic raw material and energy commodities, could adversely impact both the cost and availability of these commodities.

Loss or financial weakness of any of the Company's largest customers could adversely affect our financial results.

Although the Company has an extensive customer base, loss of, or material financial weakness of, certain of our largest customers could adversely affect the Company's financial condition and results of operations until such business is replaced. No assurances can be made that the Company would be able to regain or replace any lost customers.

The Company's business is subject to operating risks common to chemical manufacturing businesses, including cyber risks, any of which could disrupt manufacturing operations or related infrastructure and adversely affect results of operations.

As a global specialty chemicals manufacturing company, our business is subject to operating risks common to chemical manufacturing, storage, handling, and transportation including explosions, fires, inclement weather, natural disasters, mechanical failure, unscheduled downtime, transportation interruptions, remediation, chemical spills, discharges or releases of toxic or hazardous substances or gases. Significant limitation on the Company's ability to manufacture products due to disruption of manufacturing operations or related infrastructure could have a material adverse effect on the Company's sales revenue, costs, results of operations, credit ratings, and financial condition. Disruptions could occur due to internal factors such as computer or equipment malfunction (accidental or intentional), operator error, or process failures; or external factors such as computer or equipment malfunction at third-party service providers, natural disasters, pandemic illness, changes in laws or regulations, war or other outbreak of hostilities or terrorism, cyber attacks, or breakdown or degradation of transportation infrastructure used for delivery of supplies to the Company or for delivery of products to customers. The Company has in the past experienced cyber attacks and breaches of its computer information systems, and although none of these has had a material adverse effect on the Company's operations, no assurances can be provided that any future disruptions due to these, or other, circumstances will not have a material effect on operations. Such disruptions could result in an unplanned event that could be significant in scale and could negatively impact operations, neighbors, and the environment, and could have a negative impact on the Company's results of operations.

Growth initiatives may not achieve desired business or financial objectives and may require a significant use of resources in excess of those estimated or budgeted for such initiatives.

The Company continues to identify and pursue growth opportunities through both organic and inorganic initiatives. These growth opportunities include development and commercialization or licensing of innovative new products and technologies and related employee leadership, expertise, skill development and retention, expansion into new markets and geographic regions, alliances, ventures, and acquisitions that complement and extend the Company's portfolio of businesses and capabilities. There can be no assurance that such innovation, development and commercialization or licensing efforts, investments, or acquisitions and alliances (including integration of acquired businesses) will result in financially successful commercialization of products, or acceptance by existing or new customers, or successful entry into new markets or otherwise achieve their underlying strategic business objectives or that they will be beneficial to the Company's results of operations. There also can be no assurance that capital projects for growth efforts can be completed within the time or at the costs projected due, among other things, to demand for and availability of construction materials and labor and obtaining regulatory approvals and operating permits and reaching agreement on terms of key agreements and arrangements with potential suppliers and customers. Any such delays or cost overruns or the inability to obtain such approvals or to reach such agreements on acceptable terms could negatively affect the returns from any proposed or current investments and projects.

44

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

The Company's substantial global operations subject it to risks of doing business in foreign countries, which could adversely affect its business, financial condition and results of operations.

More than half of the Company's sales for 2016 were to customers outside of North America. The Company expects sales from international markets to continue to represent a significant portion of the its sales. Also, a significant portion of manufacturing capacity is located outside of the U.S. Accordingly, the Company's business is subject to risks related to the differing legal, political, cultural, social, and regulatory requirements and economic conditions of many jurisdictions. Fluctuations in exchange rates may affect product demand and may adversely affect the profitability in U.S. dollars of products and services provided in foreign countries. In addition, the U.S. or foreign countries may impose additional taxes or otherwise tax Eastman's foreign income, or adopt other restrictions on foreign trade or investment, including currency exchange controls or limitations on imports or exports. Certain legal and political risks are also inherent in the operation of a company with Eastman's global scope. For example, it may be more difficult for Eastman to enforce its agreements or collect receivables through foreign legal systems, and the laws of some countries may not protect the Company's intellectual property rights to the same extent as the laws of the U.S. Failure of foreign countries to have laws to protect Eastman's intellectual property rights or an inability to effectively enforce such rights in foreign countries could result in loss of valuable proprietary information. There is also risk that foreign governments may nationalize private enterprises in certain countries where Eastman operates. Social and cultural norms in certain countries may not support compliance with Eastman's corporate policies including those that require compliance with substantive laws and regulations. Also, changes in general economic and political conditions in countries where Eastman operates are a risk to the Company's financial performance. As Eastman continues to operate its business globally, its success will depend, in part, on its ability to anticipate and effectively manage these and other related risks. There can be no assurance that the consequences of these and other factors relating to its multinational operations will not have an adverse effect on Eastman's business, financial condition, or results of operations.

Legislative or regulatory actions could increase the Company's future compliance costs.

The Company and its facilities and businesses are subject to complex health, safety, and environmental laws and regulations, both in the U.S. and internationally, which require and will continue to require significant expenditures to remain in compliance with such laws and regulations. The Company's accruals for such costs and associated liabilities are subject to changes in estimates on which the accruals are based. For example, any amount accrued for environmental matters reflects the Company's assumptions about remediation requirements at the contaminated site, the nature of the remedy, the outcome of discussions with regulatory agencies and other potentially responsible parties at multi-party sites, and the number of and financial viability of other potentially responsible parties. Changes in the estimates on which the accruals are based, unanticipated government enforcement action, or changes in health, safety, environmental, chemical control regulations, and testing requirements could result in higher costs. Specifically, future changes in U.S. Federal legislation and regulation may increase the likelihood that the Company's manufacturing sites will in the future be impacted by regulation of greenhouse gas emissions and energy policy, which legislation and regulation, if enacted, may result in capital expenditures, increases in costs for raw materials and energy, limitations on raw material and energy source and supply choices, and other direct compliance costs.

Significant acquisitions expose the Company to risks and uncertainties, the occurrence of any of which could materially adversely affect the Company's business, financial condition, and results of operations.

While acquisitions have been and continue to be a part of the Company's growth strategy, acquisitions of large companies (such as the acquisition of Taminco and Solutia) subject the Company to a number of risks and uncertainties, the occurrence of any of which could have a material adverse effect on Eastman. These include, but are not limited to, the possibilities that the financial performance of the acquired business may be significantly worse than expected; that significant additional indebtedness may constrain the Company's ability to access the credit and capital markets at attractive interest rates and favorable terms, which may negatively impact the Company's liquidity or ability to pursue certain growth initiatives; that the Company may not be able to achieve the cost, revenue, tax, or other "synergies" expected from any acquisition, or that there may be delays in achieving any such synergies; that management's time and effort may be dedicated to the new business resulting in a loss of focus on the successful operation of the Company's existing businesses; and that the Company may be required to expend significant additional resources in order to integrate any acquired business into Eastman or that the integration efforts will not achieve the expected benefits.

45

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

In addition to the foregoing most significant known risk factors to the Company, there may be other factors, not currently known to the Company, which could, in the future, materially adversely affect the Company, its business, financial condition, or results of operations. The foregoing discussion of the most significant risk factors to the Company does not necessarily present them in order of importance. This disclosure, including that under "Outlook" and other forward-looking statements and related disclosures made by the Company in this Quarterly Report and elsewhere from time to time, represents management's best judgment as of the date the information is given. The Company does not undertake responsibility for updating any of such information, whether as a result of new information, future events, or otherwise, except as required by law. Investors are advised, however, to consult any further public Company disclosures (such as in filings with the Securities and Exchange Commission or in Company press releases) on related subjects.

46

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There are no material changes to the Company's market risks from those disclosed in Part II, Item 7A of the Company's 2016 Annual Report on Form 10-K.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company maintains a set of disclosure controls and procedures designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the Company's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. An evaluation was carried out under the supervision and with the participation of the Company's management, including the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), of the effectiveness of the Company's disclosure controls and procedures. Based on that evaluation, the CEO and CFO have concluded that as of June 30, 2017 the Company's disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed was accumulated and communicated to management as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There has been no change in the Company's internal control over financial reporting that occurred during the second quarter of 2017 that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

General

From time to time, Eastman and its operations are parties to, or targets of, lawsuits, claims, investigations and proceedings, including product liability, personal injury, asbestos, patent and intellectual property, commercial, contract, environmental, antitrust, health and safety, and employment matters, which are being handled and defended in the ordinary course of business. While the Company is unable to predict the outcome of these matters, it does not believe, based upon currently available facts, that the ultimate resolution of any such pending matters will have a material adverse effect on its overall financial condition, results of operations, or cash flows.

Solutia Legacy Torts Claims Litigation

Pursuant to an Amended and Restated Settlement Agreement effective February 28, 2008 between Solutia Inc. ("Solutia") and Monsanto Company ("Monsanto") in connection with Solutia's emergence from Chapter 11 bankruptcy proceedings (the "Monsanto Settlement Agreement"), Monsanto is responsible for the defense and indemnification of Solutia against any Legacy Tort Claims (as defined in the Monsanto Settlement Agreement) and Solutia has agreed to retain responsibility for certain tort claims, if any, that may arise from Solutia's conduct after its spinoff from Pharmacia Corporation (f/k/a Monsanto), which occurred on September 1, 1997. Solutia, which became a wholly-owned subsidiary of Eastman on July 2, 2012, has been named as a defendant in several such proceedings, and has submitted the matters to Monsanto as Legacy Tort Claims. To the extent these matters are not within the meaning of Legacy Tort Claims, Solutia could potentially be liable thereunder. In connection with the completion of its acquisition of Solutia, Eastman guaranteed the obligations of Solutia and Eastman was added as an indemnified party under the Monsanto Settlement Agreement.

ITEM 1A. RISK FACTORS

For identification and discussion of the most significant risks applicable to the Company and its business, see "Risk Factors" in Management's Discussion and Analysis of Financial Condition and Results of Operations in Part I, Item 2 of this Quarterly Report on Form 10-Q.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(c) Purchases of Equity Securities by the Issuer

In February 2014, the Board of Directors authorized repurchase of up to an additional $1 billion of the Company's outstanding common stock. As of June 30, 2017, a total of 8,718,866 shares have been repurchased under this authorization for a total amount of $673 million. During first six months2017, the Company repurchased 2,176,676 shares of common stock for a cost of $175 million. For additional information, see Note 11, "Stockholders' Equity", to the Company's unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Period	Total Number of Shares Purchased (1)	Average Price Paid Per Share (2)		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value (in millions) that May Yet Be Purchased Under the Plans or Programs
April 1 - 30, 2017	160,000	$	81.58	160,000	$	414
May 1 - 31, 2017	775,619	$	79.42	775,619	$	352
June 1 - 30, 2017	297,358	$	84.07	297,358	$	327
Total	1,232,977	$	80.82	1,232,977

⁽¹⁾  All shares were repurchased under a Company announced repurchase plan.

⁽²⁾  Average price paid per share reflects the weighted average purchase price paid for shares.

ITEM 5. OTHER INFORMATION

(a)    On August 3, 2017, the Board of Directors of the Company amended the Company's Bylaws. The Bylaw amendments, among other things:

• designate the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of litigation;

• add stockholder proponent and stockholder director nomination and nominee disclosure requirements;

• give the Board of Directors explicit authority to postpone or reschedule a stockholder meeting;

• clarify the power of the Chairman of a stockholder meeting over the conduct of such meeting; and

• update certain provisions to reflect current practices, processes, and organizational structure.  

The foregoing summary of the Bylaw amendments does not purport to be complete and is qualified in its entirety by reference to the amended Bylaws. The text of the amendments to the Bylaws is marked in Exhibit 99.01 to this Quarterly Report on Form 10-Q, and the Company's Bylaws as amended and restated are filed as Exhibit 3.02 to this Quarterly Report.

ITEM 6. EXHIBITS

Exhibits filed as part of this report are listed in the Exhibit Index.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			Eastman Chemical Company
Date:	August 4, 2017	By:	/s/ Curtis E. Espeland
			Curtis E. Espeland
			Executive Vice President and Chief Financial Officer

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	EXHIBIT INDEX
Exhibit Number	Description
3.01	Amended and Restated Certificate of Incorporation of Eastman Chemical Company (incorporated herein by reference to Exhibit 3.01 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2012)
3.02 *	Amended and Restated Bylaws of Eastman Chemical Company
4.01	Form of Eastman Chemical Company common stock certificate as amended February 1, 2001 (incorporated herein by reference to Exhibit 4.01 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2001)
4.02	Indenture, dated as of January 10, 1994, between Eastman Chemical Company and The Bank of New York, as Trustee (incorporated herein by reference to Exhibit 4(a) to the Company's Current Report on Form 8-K dated January 10, 1994)
4.03	Indenture, dated as of June 5, 2012, between Eastman Chemical Company and Wells Fargo Bank, as Trustee (incorporated herein by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K dated June 5, 2012)
4.04	Form of 7 1/4% Debentures due January 15, 2024 (incorporated herein by reference to Exhibit 4(d) to the Company's Current Report on Form 8-K dated January 10, 1994)
4.05	Officers' Certificate pursuant to Sections 201 and 301 of the Indenture related to 7 5/8% Debentures due 2024 (incorporated herein by reference to Exhibit 4(a) to the Company's Current Report on Form 8-K dated June 8, 1994)
4.06	Form of 7 5/8% Debentures due June 15, 2024 (incorporated herein by reference to Exhibit 4(b) to the Company's Current Report on Form 8-K dated June 8, 1994)
4.07	Form of 7.60% Debentures due February 1, 2027 (incorporated herein by reference to Exhibit 4.08 to the Company's Annual Report on Form 10-K for the year ended December 31, 1996)
4.08	Officer's Certificate pursuant to Sections 201 and 301 of the Indenture related to 7.60% Debentures due February 1, 2027 (incorporated herein by reference to Exhibit 4.09 to the Company's Annual Report on Form 10-K for the year ended December 31, 1996)
4.09	Form of 5.500% Notes due 2019 (incorporated herein by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K dated November 2, 2009)
4.10	Form of 4.5% Note due 2021 (incorporated herein by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K dated December 10, 2010)
4.11	Form of 3.6% Note due 2022 (incorporated herein by reference to Exhibit 4.3 to the Company's Current Report on Form 8-K dated June 5, 2012)
4.12	Form of 4.8% Note due 2042 (incorporated herein by reference to Exhibit 4.4 to the Company's Current Report on Form 8-K dated June 5, 2012)
4.13	Form of 4.65% Note due 2044 (incorporated herein by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K dated May 15, 2014)
4.14	Form of 2.70% Note due 2020 (incorporated herein by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K dated November 20, 2014)
4.15	Form of 3.80% Note due 2025 (incorporated herein by reference to Exhibit 4.18 to the Company's Annual Report on Form 10-K for the year ended December 31, 2014)

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	EXHIBIT INDEX
Exhibit Number	Description
4.16	Form of 1.50% Note due 2023 (incorporated herein by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K dated May 26, 2016 and Exhibit 1.1 to the Company's Current Report on Form 8-K dated November 21, 2016)
4.17	Form of 1.875% Note due 2026 (incorporated herein by reference to Exhibit 4.3 to the Company's Current Report on Form 8-K dated November 21, 2016)
12.01 *	Statement re: Computation of Ratios of Earnings to Fixed Charges
31.01 *	Rule 13a – 14(a) Certification by Mark J. Costa, Chief Executive Officer, for the quarter ended June 30, 2017
31.02 *	Rule 13a – 14(a) Certification by Curtis E. Espeland, Executive Vice President and Chief Financial Officer, for the quarter ended June 30, 2017
32.01 *	Section 1350 Certification by Mark J. Costa, Chief Executive Officer, for the quarter ended June 30, 2017
32.02 *	Section 1350 Certification by Curtis E. Espeland, Executive Vice President and Chief Financial Officer, for the quarter ended June 30, 2017
99.01 *	Amended and Restated Bylaws of Eastman Chemical Company Marked to Show Changes of August 3, 2017 Amendments
101.INS *	XBRL Instance Document
101.SCH *	XBRL Taxonomy Extension Schema Document
101.CAL *	XBRL Taxonomy Calculation Linkbase Document
101.DEF *	XBRL Definition Linkbase Document
101.LAB *	XBRL Taxonomy Label Linkbase Document
101.PRE *	XBRL Presentation Linkbase Document

* Denotes exhibit filed or furnished herewith.

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EX-3.02

Exhibit 3.02

EASTMAN CHEMICAL COMPANY BYLAWS

SECTION I

Capital Stock

Section 1.1.Certificates. Every holder of stock in the Corporation shall be entitled to have a certificate signed in the name of the Corporation by the Chairman of the Board, the Chief Executive Officer or a Vice President, and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary of the Corporation certifying the number of shares in the Corporation owned by such holder. Any or all of the signatures on the certificate may be an electronic signature. In case any officer, transfer agent, or registrar who has signed or whose electronic signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if such person were such officer, transfer agent, or registrar at the date of issue.

Section 1.2.Record Ownership. A record of the name and address of the holder of each certificate, the number of shares represented thereby and the date of issue thereof shall be made on the Corporation’s books. The Corporation shall be entitled to treat the holder of record of any share of stock as the holder in fact thereof, and accordingly shall not be bound to recognize any equitable or other claim to or interest in any share on the part of any other person, whether or not it shall have express or other notice thereof, except as required by the laws of the State of Delaware.

Section 1.3.Transfer of Record Ownership. Transfers of stock shall be made on the books of the Corporation only by direction of the person named in the certificate or such person’s attorney, lawfully constituted in writing, and only upon the surrender of the certificate therefor and a written assignment of the shares evidenced thereby, which certificate shall be canceled before the new certificate is issued.

Section 1.4.Lost Certificates. Any person claiming a stock certificate in lieu of one lost, stolen or destroyed shall give the Corporation an affidavit as to such person’s ownership of the certificate and of the facts which go to prove its loss, theft or destruction. Such person shall also, if required by policies adopted by the Board of Directors, give the Corporation a bond, in such form as may be approved by the Corporation, sufficient to indemnify the Corporation against any claim that may be made against it on account of the alleged loss of the certificate or the issuance of a new certificate.

Section 1.5.Transfer Agents; Registrars; Rules Respecting Certificates. The Board of Directors may appoint, or authorize any officer or officers to appoint, one or more transfer agents and one or more registrars. The Board of Directors may make such further rules and regulations as it may deem expedient concerning the issue, transfer and registration of stock certificates of the Corporation.

Section 1.6.Record Date. The Board of Directors may fix in advance a future date, not exceeding 60 days (nor, in the case of a stockholders’ meeting, less than ten days) preceding the date of any meeting of stockholders, payment of dividend or other distribution, allotment of rights, or change, conversion or exchange of capital stock or for the purpose of any other lawful action, as the record date for determination of the stockholders entitled to notice of and to vote at any such meeting and any adjournment or recess thereof, or to receive any such dividend or other distribution or allotment of rights, or to exercise the rights in respect of any such change, conversion or exchange of capital stock, or to participate in any such other lawful action, and in such case such stockholders and only such stockholders as shall be stockholders of record on the date so fixed shall be entitled to such notice of and to vote at such meeting and any adjournment or recess thereof, or to receive such dividend or other distribution or allotment of rights, or to exercise such rights, or to participate in any such other lawful action, as the case may be, notwithstanding any transfer of any stock on the books of the Corporation after any such record date fixed as aforesaid.

SECTION II

Meetings of Stockholders

Section 2.1.Annual. The annual meeting of stockholders for the election of directors and the transaction of such other proper business shall be held at the time and place, within or without the State of Delaware, as determined by the Board of Directors. The Board of Directors may, at any time prior to the holding of an annual meeting of stockholders, and for any reasonable reason, postpone, reschedule or cancel any annual meeting of stockholders previously scheduled by the Board of Directors.

Section 2.2.Special. (a) Special meetings of stockholders for any purpose or purposes may be called only by the Board of Directors (i) pursuant to a resolution adopted by a majority of the members of the Board of Directors then in office or (ii) upon the written request of the holders of at least twenty-five percent of the outstanding voting stock of the Corporation (a “Request”) in accordance with the requirements set forth in Section 2.2(b) hereof.

(b)Any Request shall set forth with particularity as to each Meeting Proponent (as defined below), (i) the names and business addresses of such Meeting Proponent; (ii) the name and address of each Meeting Proponent, as they appear on the Corporation’s books (if they so appear); (iii) (A) the class or series, if any, and number of shares of the Corporation that are, directly or indirectly, beneficially owned by each Meeting Proponent, (B) any option, warrant, forward contract, contract of sale, convertible security, stock appreciation right, swap or similar right, instrument or agreement with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of shares of the Corporation or with a value derived in whole or in part from the value of any class or series of shares of the Corporation, whether or not such right, instrument or agreement shall be subject to settlement in the underlying class or series of stock of the Corporation or otherwise (a “Derivative Instrument”), directly or indirectly, owned beneficially by such Meeting Proponent and any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the value of shares of the Corporation, (C) a description of any proxy, contract, arrangement, understanding or relationship pursuant to which such Meeting Proponent has a right to vote any shares of any security of the Corporation, (D) any Short Interest in any security of the Corporation (for purposes of these Bylaws a person shall be deemed to have a “Short Interest” in a security if such person, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, has the opportunity to profit or share in any profit derived from any decrease in the value of the subject security), (E) any rights to dividends on the shares of the Corporation owned beneficially by such Meeting Proponent that are separated or separable from the underlying shares of the Corporation, (F) any proportionate interest in shares of the Corporation or Derivative Instruments held, directly or indirectly, by a general or limited partnership in which such Meeting Proponent is a general partner or, directly or indirectly, beneficially owns an interest in a general partner and (G) any performance-related fees (other than an asset-based fee) that such Meeting Proponent is entitled to based on any increase or decrease in the value of shares of the Corporation or Derivative Instruments, if any, including, without limitation, any such interests held by members of such Meeting Proponent’s immediate family sharing the same household; (iv) the text of the proposal or business (including the text of any resolutions proposed for consideration and, if the business includes a proposal to amend these Bylaws or the Certificate of Incorporation, the language of the proposed amendment); (v) all arrangements or understandings between each Meeting Proponent and any other Persons, including their names, in connection with the proposed business of the special meeting; (vi) a representation that the Meeting Proponent is a holder of record of stock of the Corporation entitled to vote at such special meeting, will continue to be a holder of record of stock entitled to vote at such meeting through the date of the special meeting and intends to appear in person or by proxy at the special meeting to bring such proposal or business before the meeting; (vii) a description of any material interests in such proposal or business of the Meeting Proponent; and (viii) a representation as to whether such Meeting Proponent intends or is part of a group that intends to deliver a proxy statement and form of proxy to holders of at least the percentage of the voting power of the Corporation’s outstanding stock required to approve or adopt the proposal or business. The information required under this Section 2.2(b) shall be supplemented and updated by such Meeting Proponent as described under Section 2.7(f). Except as permitted in Section 2.2(c), the only business that may be conducted at the special meeting shall be the business proposed in the Request and any business proposed by the Board of Directors. The Request shall be delivered personally or sent by registered mail to the Secretary of the Corporation at its principal executive offices. If the Board of Directors determines that the Request complies with the Certificate of Incorporation and the provisions of these Bylaws and that the proposal to be considered or business to

be conducted is a proper subject for stockholder action under applicable law, the Board of Directors shall call and send notice of a special meeting for the purpose set forth in the Request in accordance with Section 2.3 of these Bylaws. The Board of Directors shall determine the date for such special meeting, which date shall be not later than 90 days following the Corporation’s receipt of the Request, and the record date(s) for stockholders entitled to notice of and to vote at such special meeting.

(c)Special meetings may be held at any place, within or without the State of Delaware, as determined by the Board of Directors. The Board of Directors may, at any time prior to the holding of a special meeting of stockholders, and for any reasonable reason, postpone, reschedule or cancel any special meeting of stockholders previously scheduled by the Board of Directors. The only business which may be conducted at a special meeting, other than procedural matters and matters relating to the conduct of the special meeting, shall be the matter or matters described in the notice of the meeting given by the Board of Directors.

(d) For purposes of these Bylaws, the term “Meeting Proponent” shall mean (i) the stockholder providing the Request, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the Request is made, (iii) any affiliate or associate (each within the meaning of Rule 12b-2 under the Securities Exchange Act of 1934 (the “Exchange Act”) for purposes of these Bylaws) of each such stockholder or beneficial owner and (iv) any other person with whom such stockholder or beneficial owner (or any of their respective affiliates or associates) is forming a group (within the meaning of Section 13(d) under the Exchange Act).

Section 2.3.Notice. The Board of Directors shall give notice of each meeting of stockholders in writing, electronically to such stockholders as have consented to the receipt of such notice by electronic means, or by any such other means permitted by the Delaware General Corporation Law. Such notice shall state the date, time, place and, in the case of a special meeting, the purpose thereof, shall be given as provided by law by the Secretary or an Assistant Secretary not less than ten days nor more than 60 days before such meeting (unless a different time is specified by law) to every stockholder entitled by law to notice of such meeting.

Section 2.4.List of Stockholders. A complete list of the stockholders entitled to vote at any meeting of stockholders, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder, shall be prepared by the Secretary. Such list shall be available for examination of any stockholder, for any purpose germane to the meeting, either on a reasonably accessible electronic network or, during normal business hours, at the Corporation’s principal place of business, for at least ten days before the meeting and at the place of the meeting during the whole time of the meeting. In the event that such list is to be made available on an electronic network, the notice of meeting given under Section 2.3 hereof shall provide the information required to gain access to such list.

Section 2.5.Quorum; Adjournment and Recess. The holders of shares of stock entitled to cast a majority of the votes on the matters at issue at a meeting of stockholders, present in person or represented by proxy, shall constitute a quorum, except as otherwise required by the Delaware General Corporation Law. For the avoidance of doubt, abstentions and broker non-votes shall be treated as present for purposes of determining the presence or absence of a quorum. The chairman of the meeting may adjourn or recess the meeting at any time and for any reasonable reason, without notice other than announcement at the meeting, whether or not there is such a quorum. At any such adjourned or recessed meeting at which there is a quorum, any business may be transacted that might have been transacted at the meeting originally called.

Section 2.6.Organization and Procedure. (a) The Chairman of the Board or, if the Chairman of the Board is not available, the Lead Director, or, if the Lead Director is not available, such other officer of the Corporation designated by a majority of the directors that the Corporation would have if there were no vacancies on the Board of Directors (the “Whole Board”), will call meetings of the stockholders to order and will act as the chairman of the meeting thereof. Unless otherwise determined prior to the meeting by a majority of the Whole Board, the chairman of the meeting of the stockholders will have the right and the authority to determine and maintain the rules, regulations and procedures for the proper conduct of the meeting, including, without limitation, (i) restricting entry to the meeting after it has commenced, (ii) maintaining order and the safety of those in attendance, (iii) opening and closing the polls for voting, (iv) dismissing business or proposals not properly submitted, (v) limiting the time allowed for discussion of the business of the meeting, (vi) restricting the persons (other than stockholders of the Corporation or their duly

appointed proxies) that may attend the meeting, (vii) ascertaining whether any stockholder or proxy holder may be excluded from the meeting based upon any determination by the chairman of the meeting, in his or her sole discretion, that the stockholder or proxy holder is unduly disruptive or is likely to disrupt the meeting and (viii) restricting the use of cell phones, audio or video recording devices and similar devices at the meeting. The Secretary of the Corporation shall act as secretary of the meeting, but in the absence of the Secretary, the chairman of the meeting may appoint a secretary of the meeting.

(b)At an annual meeting of the stockholders, only such business will be conducted or considered as is properly brought before the meeting. To be properly brought before an annual meeting, business must be (i) specified in the notice of meeting (or any supplement thereto) given by the Board of Directors in accordance with these Bylaws, (ii) brought before the meeting by the chairman of the meeting or by or at the direction of a majority of the Whole Board, or (iii) otherwise properly requested to be brought before the meeting by a stockholder of the Corporation in accordance with these Bylaws and applicable law.

(c)At a special meeting of stockholders, only such business may be conducted or considered as is properly brought before the meeting. To be properly brought before a special meeting, business must be (i) specified in the notice of the meeting (or any supplement thereto) given by the Board of Directors in accordance with these Bylaws or (ii) brought before the meeting by the chairman of the meeting or by or at the direction of a majority of the Whole Board.

(d) The determination of whether any business sought to be brought before any annual or special meeting of the stockholders is properly brought before such meeting will be made by the chairman of the meeting. If the chairman of the meeting determines that any business is not properly brought before such meeting, he or she will so declare at the meeting and any such business will not be conducted or considered.

Section 2.7.Stockholder Nominations and Proposals. (a) No Stockholder Nomination (as defined below) or any proposal for a stockholder vote on any other business (a “Stockholder Proposal”) shall be submitted by a stockholder to the Corporation’s stockholders unless each Proponent (as defined below) has submitted to the Secretary a written notice setting forth with particularity as to each Proponent (i) the names and business addresses of each Proponent; (ii) the name and address of each Proponent as they appear on the Corporation’s books (if they so appear); (iii) (A) the class or series, if any, and number of shares of the Corporation that are, directly or indirectly, beneficially owned by each Proponent, (B) any Derivative Instruments that are, directly or indirectly, beneficially owned by each Proponent and any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the value of shares of the Corporation, (C) a description of any proxy, contract, arrangement, understanding or relationship pursuant to which such Proponent has a right to vote any shares of any security of the Corporation, (D) any Short Interest in any security of the Corporation, (E) any rights to dividends on the shares of the Corporation beneficially owned by such Proponent that are separated or separable from the underlying shares of the Corporation, (F) any proportionate interest in shares of the Corporation or Derivative Instruments held, directly or indirectly, by a general or limited partnership in which such Proponent is a general partner or, directly or indirectly, beneficially owns an interest in a general partner and (G) any performance-related fees (other than an asset-based fee) that such Proponent is entitled to based on any increase or decrease in the value of shares of the Corporation or Derivative Instruments, if any, including, without limitation, any such interests held by members of such Proponent’s immediate family sharing the same household; (iv) a description of the Stockholder Proposal or Stockholder Nomination, as applicable, containing all material information relating thereto including any information relating to such Proponent that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies or consents for, as applicable, the Stockholder Proposal or the Stockholder Nomination in a contested election pursuant to Section 14 of the Exchange Act and the regulations promulgated thereunder; (v) the text of the Stockholder Proposal (including the text of any resolutions proposed for consideration and, if the business includes a proposal to amend these Bylaws or the Certificate of Incorporation, the language of the proposed amendment); (vi) all arrangements or understandings between each Proponent and any other Persons (as such term is defined in Article V of the Certificate of Incorporation), including their names, in connection with the Stockholder Proposal or Stockholder Nomination; (vii) a representation that the Proponent is a holder of record of stock of the Corporation entitled to vote at a meeting of stockholders, will continue to be a holder of record of stock entitled to vote at such meeting through the date of the meeting and intends to appear in person or by proxy at the meeting to bring such Stockholder Proposal or Stockholder Nomination before the meeting; (viii) a description of any material interests in such Stockholder Proposal or Stockholder

Nomination of the Proponent on whose behalf the proposal or nomination is made; (ix) a representation as to whether such Proponent intends or is part of a group that intends to deliver a proxy statement or form of proxy to holders of at least the percentage of the voting power of the Corporation’s outstanding stock required to approve or adopt the Stockholder Proposal or Stockholder Nomination; and (x) such other information as the Board of Directors reasonably determines is necessary or appropriate to enable the Board of Directors and stockholders of the Corporation to consider the Stockholder Proposal or Stockholder Nomination. The information required under this Section 2.7(a) shall be supplemented and updated by each Proponent as described under Section 2.7(f). The chairman of the meeting at any stockholders’ meeting may determine that any Stockholder Proposal or Stockholder Nomination was not made in accordance with the procedures prescribed in these Bylaws or is otherwise not in accordance with applicable law, and if it is so determined, such officer shall so declare at the meeting and the Stockholder Proposal or Stockholder Nomination shall be disregarded.

(b)Only persons who are selected and recommended by the Board of Directors or the committee of the Board of Directors designated to make recommendations, or who are nominated by stockholders in accordance with the procedures set forth in this Section 2.7 (a “Stockholder Nomination”) and the procedures set forth in Section 2.8, shall be eligible for election, or qualified to serve, as directors. Nominations of individuals for election to the Board of Directors of the Corporation at any annual meeting or any special meeting of stockholders at which directors are to be elected may be made by any stockholder of the Corporation entitled to vote for the election of directors at that meeting by compliance with the procedures set forth in this Section 2.7 or the procedures set forth in Section 2.8. Nominations by stockholders under this Section 2.7 shall be made by written notice (a “Nomination Notice”), which shall set forth as to each individual nominated: (i) the name, date of birth, business address and residence address of such individual; (ii) the business experience during the past five years of such nominee, including his or her principal occupations and employment during such period, the name and principal business of any corporation or other organization in which such occupations and employment were carried on, and such other information as to the nature of his or her responsibilities and level of professional competence as may be sufficient to permit assessment of his or her prior business experience; (iii) whether the nominee is or has ever been at any time a director, officer or owner of 5% or more of any class of capital stock, partnership interests or other equity interest of any corporation, partnership or other entity; (iv) any directorships currently held, or held within the preceding five years, by such nominee in any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, or subject to the requirements of Section 15(d) of such Act or any company registered as an investment company under the Investment Company Act of 1940, as amended; (v) whether, in the last ten years, such nominee has been subject to any event specified in Item 401(f) of Regulation S-K of the Securities Exchange Act of 1934 or any successor provision which may be material to an evaluation of the ability or integrity of the nominee; (vi) whether the nominee is a party to any compensatory, payment or other financial agreement, arrangement or understanding with any person or entity other than the Corporation, or has received any such compensation or other payment from any person or entity other than the Corporation, in each case in connection with candidacy or service as a director of the Corporation (a “Third-Party Compensation Arrangement”); and (vii) all information relevant to a determination of the nominee’s status as to “independence,” including references to the criteria established by the New York Stock Exchange (or any other exchange or quotation system on which the Corporation’s equity securities are then listed or quoted) and the Corporation’s Corporate Governance Guidelines, in each case as in effect at the time of such Stockholder Nomination.

(c)Each Nomination Notice shall include (i) a written representation and agreement in the form required by the Corporation (which form the Proponent shall request from the Secretary and shall be provided by the Corporation within ten (10) days of such request) signed by the nominee that the nominee (A) has read and agrees, if elected to serve as a member of the Board of Directors, to adhere to the Corporation’s Corporate Governance Guidelines and any other Corporation policies and guidelines applicable to directors, (B) is not and will not become a party to any Third-Party Compensation Arrangement that has not been disclosed to the Corporation, (C) is not and will not become a party to (1) any agreement, arrangement or understanding (whether written or oral) with any person or entity as to how the nominee would vote or act on any issue or question as a director (a “Voting Commitment”), in each case that has not been disclosed to the Corporation, or (2) any Voting Commitment that could limit or interfere with such nominee’s ability to comply, if elected to serve as a member of the Board of Directors, with such nominee’s fiduciary duties under applicable law, (D) in such nominee’s individual capacity and on behalf of each Proponent on whose behalf the nomination is being made, would be in compliance, if elected to serve as a member of the Board of Directors, and will comply with all applicable law and all applicable rules of the U.S. exchanges upon which the capital stock of

the Corporation is listed, (E) in such nominee’s individual capacity and on behalf of each Proponent on whose behalf the nomination is being made, intends to serve a full term if elected to serve as a member of the Board of Directors and (F) will provide facts, statements and other information in all communications with the Corporation and its stockholders that are or will be true and correct in all material respects and do not and will not omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; and (ii) a written questionnaire with respect to the background and qualification of such nominee and the background of any other person or entity on whose behalf the nomination is being made in the form required by the Corporation (which form the Proponent shall request from the Secretary and shall be provided by the Corporation within ten (10) days of such request). If the chairman of the meeting at any stockholders’ meeting determines that a nomination was not made in accordance with the procedures prescribed by these Bylaws or is otherwise not in accordance with applicable law, he shall so declare to the meeting and the defective nomination shall be disregarded.

(d)In the case of an annual meeting of stockholders, Nomination Notices and Stockholder Proposals shall be delivered to the Secretary at the principal executive office of the Corporation no earlier than 150 days and not later than 120 days prior to the date on which the notice of the immediately preceding year’s annual meeting of stockholders was first sent to the stockholders of the Corporation, provided that in the event that the date of the annual meeting is more than 30 days before or 70 days after its anniversary date, the Nomination Notice and Stockholder Proposals must be so delivered not later than the later of (i) 120 days prior to such annual meeting or (ii) 10 days following the day on which a public announcement of the annual meeting date is first made. In the case of a special meeting of stockholders, Stockholder Proposals may be brought before the meeting only upon a proper request in accordance with Section 2.2(a)(ii).

(e)For purposes of these Bylaws, the term “Proponent” shall mean (i) the stockholder providing the Stockholder Proposal or Stockholder Nomination, as applicable, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the Stockholder Proposal or Stockholder Nomination is made, (iii) any affiliate or associate (each within the meaning of Rule 12b‑2 under the Exchange Act for purposes of these Bylaws) of such stockholder or beneficial owners and (iv) any other person with whom such stockholder or beneficial owner (or any of their respective affiliates or associates) is forming a group.

(f)A stockholder providing notice of a Stockholder Proposal or Stockholder Nomination, as applicable, shall supplement and update such notice, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 2.7 shall be true and correct (i) as of the record date for the meeting and (ii) as of the date that is ten business days prior to the meeting or any adjournment, recess, cancellation, rescheduling or postponement thereof, and such supplement and update shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five business days after the record date for the meeting (in the case of the supplement and update required to be made as of the record date) and not later than seven business days prior to the date for the meeting, if practicable (or, if not practicable, on the first practicable date prior to any adjournment, recess or postponement thereof (in the case of the supplement and update required to be made as of ten business days prior to the meeting or any adjournment, recess or postponement thereof)).

(g) Notwithstanding the foregoing provisions of this Section 2.7, a stockholder shall also comply with all applicable requirements of state law and of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in these Bylaws; provided, however, that any references in these Bylaws to the Exchange Act or the rules promulgated thereunder are not intended to and shall not limit the requirements applicable to Stockholder Nominations or Stockholder Proposals pursuant to this Section 2.7. Nothing in this Section 2.7 shall be deemed to affect any rights of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act.

Section 2.8.Inclusion of Director Nominations by Stockholders in the Corporation’s Proxy Materials.

(a)Subject to the terms and conditions set forth in these Bylaws (including the provisions of Section 2.7 concerning Stockholder Nominations) and applicable law, the Corporation shall include in its proxy statement and form of proxy (hereinafter, the “proxy materials”) for an annual meeting of stockholders for the election of directors, in addition to the persons selected and recommended for election by the Board of Directors or any committee thereof, the name,

together with the Required Information (defined below), of any person nominated for election (the “Proxy Access Stockholder Nominee”) to the Board of Directors by one or more Stockholders that satisfies the notice, ownership and other requirements of this Section 2.8 (such person or group who nominates a Proxy Access Stockholder Nominee, the “Eligible Stockholder”).

(b)To nominate a Proxy Access Stockholder Nominee, the Eligible Stockholder must provide a written notice that expressly elects to have its Proxy Access Stockholder Nominee included in the Corporation’s proxy materials pursuant to this Section 2.8 (the “Notice of Proxy Access Nomination”). To be timely, a Notice of Proxy Access Nomination must be delivered to the Secretary at the principal executive office of the Corporation during the period for delivery of Nomination Notices and Stockholder Proposals described in Section 2.7(c) of these Bylaws (the last day on which a Notice of Proxy Access Nomination may be delivered, the “Final Proxy Access Nomination Date”). In addition to other requirements set forth in this Section 2.8, the Notice of Proxy Access Nomination must include the name and address of the Eligible Stockholder (including each stockholder and beneficial owner whose stock ownership is counted for the purposes of qualifying as an Eligible Stockholder).

(c)For purposes of this Section 2.8, the “Required Information” that the Corporation will include in its proxy materials is (i) the information concerning the Proxy Access Stockholder Nominee and the Eligible Stockholder that the Corporation determines is required to be disclosed in the Corporation’s proxy materials by the regulations promulgated under the Securities Exchange Act of 1934; and (ii) if the Eligible Stockholder so elects, a Statement (defined below). Nothing in this Section 2.8 shall limit the Corporation’s ability to solicit against and include in its proxy materials its own statements relating to any Proxy Access Stockholder Nominee.

(d)The maximum number of Proxy Access Stockholder Nominees (including Proxy Access Stockholder Nominees that were submitted by an Eligible Stockholder for inclusion in the Corporation’s proxy materials pursuant to this Section 2.8 but either are subsequently withdrawn or that the Board of Directors decides to select and recommend as Board of Director nominees under Section 2.7 of these Bylaws) that may appear in the Corporation’s proxy materials with respect to an annual meeting of stockholders shall not exceed 20% of the number of directors in office as of the Final Proxy Access Nomination Date, or if such number is not a whole number, the closest whole number below 20% (the “Permitted Number”) but not less than one; provided, however, that the Permitted Number shall be reduced by the number of such director candidates for which the Corporation shall have received one or more valid notices that a stockholder (other than an Eligible Stockholder) intends to nominate director candidates at such applicable annual meeting of stockholders pursuant to Section 2.7 of these Bylaws; provided, further, that in the event that one or more vacancies for any reason occurs on the Board of Directors at any time after the Final Proxy Access Nomination Date and before the date of the applicable annual meeting of stockholders and the Board of Directors reduces the size of the Board of Directors in connection therewith, the Permitted Number shall be calculated based on the number of directors in office as so reduced. In the event that the number of Proxy Access Stockholder Nominees submitted by Eligible Stockholders pursuant to this Section 2.8 exceeds the Permitted Number, each Eligible Stockholder will select one Proxy Access Stockholder Nominee for inclusion in the Corporation’s proxy materials until the Permitted Number is reached, with preference provided based on the number (largest to smallest) of shares owned by each Eligible Stockholder pursuant to this Section 2.8. If the Permitted Number is not reached after each Eligible Stockholder has selected one Proxy Access Stockholder Nominee, this selection process will continue as many times as necessary, following the same order each time, until the Permitted Number is reached.

(e)An Eligible Stockholder is one or more stockholders who owns and has owned continuously, or are acting on behalf of one or more beneficial owners who own and have owned (as defined below) continuously, for at least three years as of the date the Notice of Proxy Access Nomination is received by the Corporation, shares representing at least 3% of the voting power entitled to vote generally in the election of directors (the “Required Shares”), and who continue to own the Required Shares at all times between the date the Notice of Proxy Access Nomination is received by the Corporation and the date of the applicable annual meeting of stockholders, provided that the aggregate number of stockholders, and, if and to the extent that a stockholder is acting on behalf of one or more beneficial owners, of such beneficial owners, whose stock ownership is counted for the purposes of satisfying the foregoing ownership requirement shall not exceed twenty (20). Two or more funds that are (i) under common management and investment control or (ii) under common management and funded primarily by a single employer (such funds together under each of (i) or (ii) comprising a “Qualifying Fund”) shall be treated as one stockholder for the purpose of determining the aggregate

number of stockholders in this Section 2.8(e), and treated as one person for the purpose of determining ownership in Section 2.8(f), provided that each fund comprising a Qualifying Fund otherwise meets the requirements set forth in this Section 2.8. No stockholder or beneficial holder may be a member of more than one group constituting an Eligible Stockholder under this Section 2.8.

(f)For purposes of calculating the Required Shares, “ownership” shall be deemed to consist of and include only the outstanding shares as to which a person possesses both (i) the full voting and investment rights pertaining to the shares and (ii) the full economic interest in (including the opportunity for profit and risk of loss on) such shares; provided that the ownership of shares calculated in accordance with clauses (i) and (ii) shall not include any shares (A) that a person has sold in any transaction that has not been settled or closed, (B) that a person has borrowed or purchased pursuant to an agreement to resell or (C) subject to any Derivative Instrument, in any such case which Derivative Instrument has, or is intended to have, the purpose or effect of (1) reducing in any manner, to any extent or at any time in the future, the person’s full right to vote or direct the voting of any such shares, or (2) hedging, offsetting or altering to any degree gain or loss arising from the full economic ownership of such person’s shares. “Ownership” shall include shares held in the name of a nominee or other intermediary so long as the person claiming ownership of such shares retains the right to instruct how the shares are voted with respect to the election of directors and possesses the full economic interest in the shares, provided that this provision shall not alter the obligations of any stockholder to provide the Notice of Proxy Access Nomination. Ownership of shares shall be deemed to continue during any period in which shares have been loaned if the person claiming ownership has the power to recall such loaned shares on three business days’ notice and the person recalls the loaned shares within three business days of being notified that its Proxy Access Stockholder Nominee will be included in the Corporation’s proxy materials for the applicable annual meeting, and the person holds the recalled shares through such annual meeting. Ownership of shares shall be deemed to continue during any period in which any voting power has been delegated by means of a proxy, power of attorney or other instrument or arrangement which is revocable at any time without condition. For purposes of this Section 2.8, the determination of the extent of “ownership” of shares shall be made in good faith by the Board of Directors, which determination shall be conclusive and binding on the Corporation and the stockholders. An Eligible Stockholder shall include in its Notice of Proxy Access Nomination the number of shares it is deemed to own for the purposes of this Section 2.8.

(g)No later than the Final Proxy Access Nomination Date, an Eligible Stockholder (including each stockholder, fund comprising a Qualifying Fund and beneficial owner whose stock ownership is counted for the purposes of qualifying as an Eligible Stockholder) must provide the following information in writing to the Secretary: (i) all of the information required pursuant to Section 2.7(b) as if the Notice of Proxy Access Nomination was a Nomination Notice; (ii) one or more written statements from the record holder of the shares (and from each intermediary through which the shares are or have been held during the requisite three-year holding period) verifying that, as of the date the Notice of Proxy Access Nomination is sent to the Corporation, the Eligible Stockholder owns, and has owned continuously for the preceding three years, the Required Shares, and the Eligible Stockholder’s agreement to provide (A) within five business days after the record date for the applicable annual meeting, written statements from the record holder and intermediaries verifying the Eligible Stockholder’s continuous ownership of the Required Shares through the record date, and (B) immediate notice if the Eligible Stockholder ceases to own any of the Required Shares prior to the date of the applicable annual meeting of stockholders; (iii) the written consent of each Proxy Access Stockholder Nominee to being named in the Corporation’s proxy materials as a nominee and to serving as a director if elected; and (iv) a copy of the Schedule 14N that has been filed with the Securities and Exchange Commission as required by Rule 14a-18 under the Securities Exchange Act of 1934. In addition, no later than the Final Proxy Access Nomination Date, an Eligible Stockholder (including each stockholder, fund comprising a Qualifying Fund and beneficial owner whose stock ownership is counted for purposes of qualifying as an Eligible Stockholder) must provide to the Secretary a signed and written (i) representation of the Eligible Stockholder that such Eligible Stockholder (A) acquired the Required Shares in the ordinary course of business and not with the intent to change or influence control of the Corporation, and does not presently have such intent, (B) intends to maintain qualifying ownership of the Required Shares through the date of the applicable annual meeting of stockholders, (C) has not nominated and will not nominate for election to the Board of Directors at the applicable annual meeting of stockholders any person other than its Proxy Access Stockholder Nominee, (D) has not engaged and will not engage in, and has not and will not be a “participant” in another person’s, “solicitation” within the meaning of Rule 14a-1(l) under the Securities Exchange Act of 1934 in support of the election of any individual as a director at the applicable annual meeting of stockholders other than its

Proxy Access Stockholder Nominee(s) or a nominee of the Board of Directors, (E) will not distribute to any stockholder any form of proxy for the applicable annual meeting of stockholders other than the form distributed by the Corporation, and (F) will provide facts, statements and other information in all communications with the Corporation and its stockholders that are or will be true and correct in all material respects and do not and will not omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading and otherwise will comply with all applicable laws, rules and regulations in connection with any actions taken pursuant to this Section 2.8; (ii) in the case of a nomination by a group of stockholders that together constitutes an Eligible Stockholder, designation by all such group members of one group member that is authorized to act on behalf of all members of the nominating stockholder group with respect to the nomination and matters related thereto, including withdrawal of the nomination; and (iii) undertaking that the Eligible Stockholder agrees to (A) assume all liability stemming from any legal or regulatory violation arising out of the Eligible Stockholder’s communications with the stockholders of the Corporation or out of the information that the Eligible Stockholder provided to the Corporation, (B) indemnify and hold harmless the Corporation and each of its directors, officers and employees individually against any liability, loss or damages in connection with any threatened or pending action, suit or proceeding, whether legal, administrative or investigative, against the Corporation or any of its directors, officers or employees arising out of any nomination, solicitation or other activity by the Eligible Stockholder in connection with its efforts to elect the Proxy Access Stockholder Nominee pursuant to this Section 2.8, and (C) file with the Securities and Exchange Commission any solicitation or other communication with the Corporation’s stockholders relating to the meeting at which the Proxy Access Stockholder Nominee will be nominated, regardless of whether any such filing is required under Regulation 14A of the Securities Exchange Act of 1934 or whether any exemption from filing is available for such solicitation or other communication under Regulation 14A of the Securities Exchange Act of 1934. In addition, no later than the Final Proxy Access Nomination Date, a Qualifying Fund whose stock ownership is counted for purposes of qualifying as an Eligible Stockholder must provide to the Secretary documentation reasonably satisfactory to the Board of Directors that demonstrates that the funds comprising the Qualifying Fund are either (i) under common management and investment control or (ii) under common management and funded primarily by a single employer.

(h)The Eligible Stockholder may provide to the Secretary, at the time the information required by this Section 2.8 is provided, a written statement for inclusion in the Corporation’s proxy materials for the applicable annual meeting of stockholders, not to exceed 500 words, in support of the Eligible Stockholder’s Proxy Access Stockholder Nominee (the “Statement”). Notwithstanding anything to the contrary contained in this Section 2.8, the Corporation may omit from its proxy materials any information or Statement (or portion thereof) that it, in good faith, believes would violate any applicable law or regulation.

(i)No later than the Final Proxy Access Nomination Date, each Proxy Access Stockholder Nominee must: (i) provide to the Secretary all of the consents, representations, and agreements required pursuant to Section 2.7(b) as if the Proxy Access Stockholder Nominee was a nominee; (ii) submit to the Secretary all completed and signed questionnaires required of the Corporation’s directors and nominees for election to the Board of Directors within five business days of receipt of each such questionnaire from the Corporation; and (iii) provide to the Secretary within five business days of the Corporation’s request such additional information as the Corporation determines may be necessary to permit the Board of Directors to determine (A) such Proxy Access Stockholder Nominee’s status as to “independence”, including references to the criteria established by the New York Stock Exchange (or any other exchange or quotation system on which the Corporation’s equity securities are listed), any applicable rules of the Securities and Exchange Commission and the Corporation’s Corporate Governance Guidelines, (B) if such Proxy Access Stockholder Nominee has any direct or indirect relationship with the Corporation other than those relationships that have been deemed categorically immaterial pursuant to the Corporation’s Corporate Governance Guidelines, and (C) if such Proxy Access Stockholder Nominee is not and has not been subject to any event specified in Item 401(f) of Regulation S-K of the Securities Exchange Act of 1934 or any successor provision. In the event that any information or communications provided by the Eligible Stockholder or the Proxy Access Stockholder Nominee to the Corporation or its stockholders ceases to be true and correct in any respect or omits a fact necessary to make the statements made, in light of the circumstances under which they were made, not misleading, each Eligible Stockholder or Proxy Access Stockholder Nominee, as the case may be, shall promptly notify the Secretary of any such inaccuracy or omission in such previously provided information and of the information that is required to make such information or communication true and correct.

(j)Any Proxy Access Stockholder Nominee who is included in the Corporation’s proxy materials for a particular annual meeting of stockholders but either (i) withdraws from or becomes ineligible or unavailable for election at that annual meeting, or (ii) does not receive at least 25% of the votes cast in favor of the Proxy Access Stockholder Nominee’s election, will be ineligible to be a Proxy Access Stockholder Nominee pursuant to this Section 2.8 for the next two annual meetings of stockholders. Any Proxy Access Stockholder Nominee who is included in the Corporation’s proxy statement for a particular annual meeting of stockholders, but subsequently is determined not to satisfy the eligibility requirements of this Section 2.8 or any other provision of the Corporation’s Bylaws, Certificate of Incorporation, Corporate Governance Guidelines or other applicable regulation at any time before the applicable annual meeting of stockholders, will not be eligible for election at the relevant annual meeting of stockholders and may not be substituted by the Eligible Stockholder that nominated such Proxy Access Stockholder Nominee. Any Eligible Stockholder (including each stockholder, fund comprising a Qualifying Fund or beneficial owner whose stock ownership is counted for the purposes of qualifying as an Eligible Stockholder) whose Proxy Access Stockholder Nominee is elected as a director at the annual meeting of stockholders will not be eligible to nominate or participate in the nomination of a Proxy Access Stockholder Nominee for the following two (2) annual meetings of stockholders other than the nomination of such previously elected Proxy Access Stockholder Nominee.

(k)The Corporation shall not be required to include, pursuant to this Section 2.8, a Proxy Access Stockholder Nominee in its proxy materials for any meeting of stockholders, or, if the proxy statement already has been filed, to allow the nomination of a Proxy Access Stockholder Nominee, notwithstanding that proxies in respect of such vote may have been received by the Corporation: (i) if the Proxy Access Stockholder Nominee or the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) who has nominated such Proxy Access Stockholder Nominee has engaged in or is currently engaged in, or has been or is a “participant” in another person’s, “solicitation” within the meaning of Rule 14a-1(l) under the Securities Exchange Act of 1934 in support of the election of any individual as a director at the applicable annual meeting of stockholders other than its Proxy Access Stockholder Nominee(s) or a nominee of the Board of Directors; (ii) if another person is engaging in a “solicitation” within the meaning of Rule 14a-1(l) under the Securities Exchange Act of 1934 in support of the election of any individual as a director at the applicable annual meeting of stockholders other than a nominee of the Board of Directors; (iii) who is not independent under the listing standards of each principal U.S. exchange upon which the common stock of the Corporation is listed, any applicable rules of the Securities and Exchange Commission, and any publicly disclosed standards used by the Board of Directors in determining and disclosing independence of the Corporation’s directors, in each case as determined by the Board of Directors; (iv) who does not meet the audit committee independence requirements under the rules of any stock exchange on which the Corporation’s securities are traded, is not a “non-employee director” for the purposes of Rule 16b-3 under the Securities Exchange Act of 1934 (or any successor rule), is not an “outside director” for the purposes of Section 162(m) of the Internal Revenue Code (or any successor provision); (v) whose election as a member of the Board of Directors would cause the Corporation to be in violation of these Bylaws, the Certificate of Incorporation, the rules and listing standards of the principal U.S. securities exchanges upon which the common stock of the Corporation is listed, or any applicable state or federal law, rule or regulation; (vi) who is or has been, within the past three years, an officer or director of a competitor, as defined in Section 8 of the Clayton Antitrust Act of 1914; (vii) whose then-current or within the preceding ten years’ business or personal interests place such Proxy Access Stockholder Nominee in a conflict of interest with the Corporation or any of its subsidiaries that would cause such Proxy Access Stockholder Nominee to violate any fiduciary duties of directors established pursuant to the Delaware General Corporation Law, including but not limited to, the duty of loyalty and duty of care, as determined by the Board of Directors; (viii) who is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses) or has been convicted in such a criminal proceeding within the past ten years; (ix) if such Proxy Access Stockholder Nominee or the applicable Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) shall have provided information to the Corporation in connection with such nomination that was untrue in any material respect or omitted to state a material fact necessary in order to make any statement made, in light of the circumstances under which it was made, not misleading, as determined by the Board of Directors or any committee thereof; (x) the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) and the Proxy Access Stockholder Nominee do not appear at the applicable annual meeting of stockholders to present the Proxy Access Stockholder Nominee for election; (xi) the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) or applicable Proxy Access Stockholder Nominee otherwise breaches or fails to comply with or the Board of Directors determines it has breached its representations or obligations pursuant to these Bylaws, including,

without limitation, this Section 2.8; (xii) the Eligible Stockholder ceases to be an Eligible Stockholder for any reason, including but not limited to not owning the Required Shares through the date of the applicable annual meeting; or (xiii) upon a determination of by the Board of Directors or any committee thereof that (A) the information provided pursuant to this Section 2.8 to the Corporation by such individual or by the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) who nominated such individual was untrue in any material respect or omitted to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading or (B) such individual, or the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) who nominated such individual, shall have breached or failed to comply with its agreements, representations undertakings or obligations pursuant to these Bylaws, including, without limitation, this Section 2.8. For the purpose of this paragraph, clauses (iii) through (xiii) will result in the exclusion from the proxy materials pursuant to this Section 2.8 of the specific Proxy Access Stockholder Nominee to whom the ineligibility applies, or, if the proxy statement already has been filed, the ineligibility of the Proxy Access Stockholder Nominee; however, clauses (i) and (ii) will result in the exclusion from the proxy materials pursuant to this Section 2.8 of all Proxy Access Stockholder Nominees from the applicable annual meeting of Stockholders, or, if the proxy statement already has been filed, the ineligibility of all Proxy Access Stockholder Nominees.

This Section 2.8 shall be the exclusive method for stockholders to include nominees for director election in the Corporation’s proxy materials (other than business properly brought under and in compliance with Rule 14a-8 of the Exchange Act or any successor provision).

Section 2.9.Voting. Unless otherwise provided in a resolution or resolutions providing for any class or series of Preferred Stock pursuant to Article IV of the Certificate of Incorporation or by the Delaware General Corporation Law, each stockholder shall be entitled to one vote, in person or by proxy, for each share held of record by such stockholder who is entitled to vote generally in the election of directors. Each stockholder voting by proxy shall grant such authority in writing, by electronic or telephonic transmission or communication, or by any such other means permitted by the Delaware General Corporation Law. All questions, including elections for the Board of Directors, shall be decided by a majority of the votes cast, except as otherwise required by the Delaware General Corporation Law or as provided for in the Certificate of Incorporation or these Bylaws. Abstentions shall not be considered to be votes cast. For purposes of this Bylaw, a majority of votes cast shall mean that the number of shares voted “for” a director’s election exceeds 50% of the number of votes cast with respect to that director’s election or, in the case where the number of nominees exceeds the number of directors to be elected, cast with respect to election of directors generally. Votes cast shall include votes to withhold authority in each case and exclude abstentions with respect to that director’s election, or, in the case where the number of nominees exceeds the number of directors to be elected, abstentions with respect to election of directors generally.

If a nominee for director who is an incumbent director is not elected and no successor has been elected at such meeting, the director shall promptly tender his or her resignation to the Board of Directors. The Nominating and Corporate Governance Committee of the Board of Directors shall make a recommendation to the Board of Directors as to whether to accept or reject the tendered resignation, or whether other action should be taken. The Board of Directors shall act on the tendered resignation, taking into account the Nominating and Corporate Governance Committee’s recommendation, and publicly disclose (by a press release, a filing with the Securities and Exchange Commission, or other broadly disseminated means of communication) its decision regarding the tendered resignation and the rationale for the decision within 90 days from the date of the certification of the election results. The Nominating and Corporate Governance Committee in making its recommendation, and the Board of Directors in making its decision, may each consider any factors or other information that it considers appropriate and relevant. The director who tenders his or her resignation will not participate in the recommendation of the Nominating and Corporate Governance Committee or the decision of the Board of Directors with respect to his or her resignation. If such incumbent director’s resignation is not accepted by the Board of Directors, such director shall continue to serve until the next annual meeting of stockholders at which such director’s term expires and until his or her successor is duly elected, or his or her earlier resignation and removal. If a director’s resignation is accepted by the Board of Directors pursuant to this Bylaw, or if a nominee for director is not elected and the nominee is not an incumbent director, then the Board of Directors, in its sole discretion, may fill any resulting vacancy or may decrease the size of the Board of Directors pursuant to the Delaware General Corporation Law and the Certificate of Incorporation and these Bylaws of the Corporation.

Section 2.10.Inspectors. The Board of Directors by resolution shall, in advance of any meeting of stockholders, appoint one or more inspectors, which inspector or inspectors may include individuals who serve the Corporation in other capacities, including, without limitation, as officers, employees, agents or representatives of the Corporation, to act at the meeting and make a written report thereof. One or more persons may be designated by the Board of Directors as alternate inspectors to replace any inspector who fails to act. If no inspector or alternate is able to act at a meeting of stockholders, the chairman of the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before discharging his or her duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of his or her ability. The inspectors shall have the duties prescribed by the Delaware General Corporation Law.

SECTION III

Board of Directors

Section 3.1.Number and Qualifications. The business and affairs of the Corporation shall be managed by or under the direction of its Board of Directors. The number of directors constituting the Board of Directors shall be as authorized from time to time exclusively by a vote of a majority of the members of the Board of Directors then in office. A person who is not serving as a director shall not be eligible for nomination, appointment, or election if such person has or will have reached age 75 on the date of his or her appointment or election, and any director reaching the age of 75 during any term of office shall continue to be qualified to serve as a director only until the next annual meeting of stockholders following his or her 75th birthday.

Section 3.2.Resignation. A director may resign at any time by giving notice, in writing, by electronic transmission or by any other means permitted by the Delaware General Corporation Law, to the Chairman of the Board or to the Secretary. Unless otherwise stated in such notice of resignation, the acceptance thereof shall not be necessary to make it effective; and such resignation shall take effect at the time specified therein or, in the absence of such specification, it shall take effect upon the receipt thereof.

Section 3.3.Regular Meetings. Regular meetings of the Board of Directors may be held without further notice at such time as shall from time to time be determined by the Board of Directors. Unless otherwise determined by the Board of Directors, the locations of the regular meetings of the Board of Directors shall be in Kingsport, Tennessee. A meeting of the Board of Directors for the election of officers and the transaction of such other business as may come before it may be held without notice immediately following the annual meeting of stockholders.

Section 3.4.Special Meetings. Special meetings of the full Board of Directors may be called by the Chairman of the Board or the Lead Director. Special meetings of the non-employee, independent directors may be called by the Lead Director. Special meetings of the Board of Directors or of the non-employee, independent directors also may be called at the request in writing of one-third of the members of the Board of Directors then in office.

Section 3.5.Notice of Special Meetings. Notice of the date, time and place of each special meeting shall be mailed by regular mail to each director at his designated address at least six days before the meeting; or sent by overnight courier to each director at his designated address at least two days before the meeting (with delivery scheduled to occur no later than the day before the meeting); or given orally by telephone or other means, or by telegraph or telecopy, or by any other means comparable to any of the foregoing (including email), to each director, as applicable, at least twenty-four (24) hours before the meeting(or fewer than twenty-four (24) hours if the Chairman of the Board or the Lead Director determines that it is necessary or advisable for the Board of Directors to hold a special meeting sooner); provided, however, that if less than five days’ notice is provided and one third of the members of the Board of Directors then in office, or one-third of the number of non-employee, independent directors (in the case of a meeting of such directors) object in writing prior to or at the commencement of the meeting, such meeting shall be postponed until five days after such notice was given pursuant to this sentence (or such shorter period to which a majority of those who objected in writing agree), provided that notice of such postponed meeting shall be given in accordance with this Section 3.5. The notice of the special meeting shall state the general purpose of the meeting, with no other routine business conducted at the special meeting without such matter being stated in the notice.

Section 3.6.Place of Meetings. The Board of Directors may hold their meetings and have an office or offices inside or outside of the State of Delaware.

Section 3.7.Telephonic Meeting and Participation. Any or all of the directors may participate in a meeting of the Board of Directors or any committee thereof by conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation shall constitute presence in person at the meeting.

Section 3.8.Action by Directors Without a Meeting. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the full Board of Directors, the non-employee, independent directors, or of any committee thereof, may be taken without a meeting if all members of the Board, the non-employee, independent directors, or of such committee, as the case may be, consent thereto in writing, by electronic transmission, or by any other means permitted by the Delaware General Corporation Law, and the writing or writings or, if the consent action is taken by electronic transmission, paper reproductions of such electronic transmissions, are filed with the minutes of proceedings of the Board or committee.

Section 3.9.Quorum and Adjournment. A majority of the directors then holding office, or a majority of non-employee, independent directors then in office, for purposes of a meeting of such directors, shall constitute a quorum. The vote of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors, or of the non-employee, independent directors, as the case may be. Whether or not a quorum is present to conduct a meeting, any meeting of the Board of Directors, or of the non-employee, independent directors, as the case may be (including an adjourned meeting) may be adjourned by a majority of the directors present, to reconvene at a specific time and place. It shall not be necessary to give to the directors present at the adjourned meeting notice of the reconvened meeting or of the business to be transacted, other than by announcement at the meeting that was adjourned; provided, however, notice of such reconvened meeting, stating the date, time, and place of the reconvened meeting, shall be given to the directors not present at the adjourned meeting in accordance with the requirements of Section 3.5 hereof.

Section 3.10.Organization. The Chairman of the Board, or, in the absence of the Chairman of the Board, the Lead Director, or in the absence of the Lead Director, a member of the Board selected by the members present, shall preside at meetings of the Board. The Secretary of the Corporation shall act as secretary, but in the absence of the Secretary, the presiding officer may appoint a secretary.

Section 3.11.Compensation of Directors. Directors shall receive such compensation for their services as the Board of Directors may determine. Any director may serve the Corporation in any other capacity and receive compensation therefor.

Section 3.12.Presumption of Assent. A director of the Corporation who is present at a meeting of the Board of Directors when a vote on any matter is taken is deemed to have assented to the action taken unless he votes against or abstains from the action taken, or unless at the beginning of the meeting or promptly upon arrival the director objects to the holding of the meeting or transacting specified business at the meeting. Any such dissenting votes, abstentions or objections shall be entered in the minutes of the meeting.

SECTION IV

Chairman, Lead Director, and Committees of the Board of Directors

Section 4.1.Chairman. The Board of Directors shall, by resolution passed by a majority of the members of the Board of Directors, designate a member of the Board of Directors to serve as Chairman. The Chairman of the Board may also be the Chief Executive Officer, or other officer of the Corporation, and shall have such powers and perform such duties as may be provided for herein, and as may be incident to the office and as may be assigned by the Board of Directors.

Section 4.2.Lead Director. If the Chairman is the Chief Executive Officer or other officer or employee of the Corporation or is not an independent director (as determined by the Board of Directors), the non-employee, independent directors, by resolution passed by a majority of the non-employee, independent members of the Board of

Directors, shall designate a non-employee, independent member of the Board of Directors to serve as Lead Director. The Lead Director shall have such powers and perform such duties as may be provided for herein and as may be incident to the office and as may be assigned by the non-employee, independent members of Board of Directors.

Section 4.3.Committees. The Board of Directors shall, by resolutions passed by a majority of the members of the Board of Directors, designate members of the Board of Directors to constitute committees which shall in each case consist of such number of directors, and shall have and may execute such powers as may be determined and specified in the respective resolutions appointing them. Any such committee may fix its rules of procedure, determine its manner of acting and the time and place, whether within or without the State of Delaware, of its meetings and specify what notice thereof, if any, shall be given, unless the Board of Directors shall otherwise by resolution provide. Unless otherwise provided by the Board of Directors or such committee, the quorum, voting and other procedures shall be the same as those applicable to actions taken by the Board of Directors. A majority of the members of the Board of Directors then in office shall have the power to change the membership of any such committee at any time, to fill vacancies therein and to discharge any such committee or to remove any member thereof, either with or without cause, at any time.

SECTION V

Officers

Section 5.1.Designation. The officers of the Corporation shall be a Chief Executive Officer, a Chief Financial Officer, a Treasurer, a Chief Accounting Officer (or, if there is no Chief Accounting Officer, a Controller), and a Secretary, and such other officers as the Board of Directors may elect or appoint, or provide for the appointment of, as may from time to time appear necessary or advisable in the conduct of the business and affairs of the Corporation. Any number of offices may be held by the same persons.

Section 5.2.Election Term. At its first meeting after each annual meeting of stockholders, the Board of Directors shall elect the officers or provide for the appointment thereof. Subject to Section 5.3 and Section 5.4 hereof, the term of each officer elected by the Board of Directors shall be until the first meeting of the Board of Directors following the next annual meeting of stockholders and until such officer’s successor is chosen and qualified.

Section 5.3.Resignation. Any officer may resign at any time by giving written notice to the Secretary. Unless otherwise stated in such notice of resignation, the acceptance thereof shall not be necessary to make it effective; and such resignation shall take effect at the time specified therein or, in the absence of such specification, it shall take effect upon the receipt thereof.

Section 5.4.Removal. Any officer may be removed at any time with or without cause by affirmative vote of a majority of the members of the Board of Directors then in office. Any officer appointed by another officer may be removed with or without cause by such officer or the Chief Executive Officer.

Section 5.5.Vacancies. A vacancy in any office may be filled for the unexpired portion of the term by the Board of Directors or, in the case of offices held by officers who may be appointed by other officers, by any officer authorized to appoint such officer.

Section 5.6.Chief Executive Officer. The Chief Executive Officer shall be responsible for carrying out the policies adopted by the Board of Directors.

Section 5.7.Chief Financial Officer. The Chief Financial Officer shall act in an executive financial capacity, and assist the Chief Executive Officer in the general supervision of the Corporation’s financial policies and affairs, and shall perform all acts incident to the position of Chief Financial Officer, subject to the control of the Board of Directors.

Section 5.8.Treasurer. The Treasurer shall have charge of all funds of the Corporation and shall perform all acts incident to the position of Treasurer, subject to the control of the Board of Directors.

Section 5.9.Chief Accounting Officer and Controller. The Chief Accounting Officer (or the Controller, if there is no Chief Accounting Officer) shall serve as principal accounting officer of the Corporation, having the custody and operation of the accounting books and records of the Corporation (with the Controller, if there is a separate Controller), and shall perform all acts incident to the position of Controller, subject to the control of the Board of Directors.

Section 5.10.Secretary. The Secretary shall keep the minutes, and give notices, of all meetings of stockholders and directors and of such committees as directed by the Board of Directors. The Secretary shall have charge of such books and papers as the Board of Directors may require. The Secretary (or any Assistant Secretary) is authorized to certify copies of extracts from minutes and of documents in the Secretary’s charge and anyone may rely on such certified copies to the same effect as if such copies were originals and may rely upon any statement of fact concerning the Corporation certified by the Secretary (or any Assistant Secretary). The Secretary shall perform all acts incident to the office of Secretary, subject to the control of the Board of Directors.

Section 5.11.Compensation of Officers. The officers of the Corporation shall receive such compensation for their services as the Board of Directors or the appropriate committee thereof may determine. The Board of Directors may delegate its authority to determine compensation (other than that of the Chief Executive Officer) to designated officers of the Corporation.

Section 5.12.Execution of Instruments. Checks, notes, drafts, other commercial instruments, assignments, guarantees of signatures and contracts (except as otherwise provided herein or by law) shall be executed by the Chief Executive Officer or other officers or employees or agents, in any such case as the Board of Directors may direct or authorize.

Section 5.13.Mechanical Endorsements. The Chief Executive Officer, the Secretary, or other authorized officers may authorize any endorsement on behalf of the Corporation to be made by such mechanical means or stamps as any of such officers may deem appropriate.

SECTION VI

Indemnification

Section 6.1.Indemnification Provisions in Certificate of Incorporation. The provisions of this Section VI are intended to supplement Article VII of the Certificate of Incorporation pursuant to Sections 7.2 and 7.3 thereof. To the extent that this Section VI contains any provisions inconsistent with said Article VII, the provisions of the Certificate of Incorporation shall govern. Terms defined in such Article VII shall have the same meaning in this Section VI.

Section 6.2.Indemnification of Employees. The Corporation shall indemnify and advance expenses to its employees to the same extent as to its directors and officers, as set forth in the Certificate of Incorporation and in this Section VI of the Bylaws of the Corporation.

Section 6.3.Undertakings for Advances of Expenses. If and to the extent the Delaware General Corporation Law requires, an advancement by the Corporation of expenses incurred by an indemnitee pursuant to clause (iii) of the last sentence of Section 7.1 of the Certificate of Incorporation (hereinafter an “advancement of expenses”) shall be made only upon delivery to the Corporation of an undertaking (hereinafter an “undertaking”), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (hereinafter a “final adjudication”) that such indemnitee is not entitled to be indemnified for such expenses under Article VII of the Certificate of Incorporation or otherwise.

Section 6.4.Claims for Indemnification. If a claim for indemnification under Section 7.1 of the Certificate of Incorporation is not paid in full by the Corporation within 60 days after it has been received in writing by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be 20 days, the indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the indemnitee shall be entitled to be paid also the

expense of prosecuting or defending such suit. In any suit brought by the indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the indemnitee to enforce a right to an advancement of expenses) it shall be a defense that, and in any suit by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking the Corporation shall be entitled to recover such expenses only upon a final adjudication that, the indemnitee has not met the applicable standard of conduct set forth in Section 145 of the Delaware General Corporation Law (or any successor provision or provisions). Neither the failure of the Corporation (including the Board of Directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such suit that indemnification of the indemnitee is proper in the circumstances because the indemnitee has met the applicable standard of conduct set forth in Section 145 of the Delaware General Corporation Law (or any successor provision or provisions), nor an actual determination by the Corporation (including the Board of Directors, independent legal counsel, or its stockholders) that the indemnitee has not met such applicable standard of conduct, shall create a presumption that the indemnitee has not met the applicable standard of conduct or, in the case of such a suit brought by the indemnitee, be a defense to such suit. In any suit brought by the indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the indemnitee is not entitled to be indemnified, or to have or retain such advancement of expenses, under Article VII of the Certificate of Incorporation or this Section VI or otherwise, shall be on the Corporation.

Section 6.5.Insurance. The Corporation may maintain insurance, at its expense, to protect itself and any director, trustee, officer, employee or agent of the Corporation or another enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the Delaware General Corporation Law.

Section 6.6.Severability. In the event that any of the provisions of this Section VI (including any provision within a single section, paragraph or sentence) is held by a court of competent jurisdiction to be invalid, void or otherwise unenforceable, the remaining provisions are severable and shall remain enforceable to the full extent permitted by law.

SECTION VII

Miscellaneous

Section 7.1.Seal. The Corporation shall have a suitable seal, containing the name of the Corporation. The Secretary shall be in charge of the seal and may authorize one or more duplicate seals to be kept and used by any other officer or person.

Section 7.2.Waiver of Notice. Whenever any notice is required to be given, a waiver thereof in writing, signed by the person or persons entitled to the notice, whether before or after the time stated therein shall be deemed equivalent thereto. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened.

Section 7.3.Voting of Stock Owned by the Corporation. Powers of attorney, proxies, waivers of notice of meeting, consents and other instruments relating to securities owned by the Corporation may be executed in the name of and on behalf of the Corporation by the Chairman of the Board, the Chief Executive Officer, any Vice President or such officers or employees or agents as the Board of Directors or any of such designated officers may direct. Any such officer may, in the name of and on behalf of the Corporation, take all such action as any such officer may deem advisable to vote in person or by proxy at any meeting of security holders of any corporation in which the Corporation may own securities and at any such meeting shall possess and may exercise any and all rights and powers incident to the ownership of such securities and which, as the owner thereof, the Corporation might have exercised and possessed if present. The Board of Directors may from time to time confer like powers upon any other person or persons.

Section 7.4.General Severability. Whenever possible, each provision or portion of any provision of these Bylaws will be interpreted in such manner as to be effective and valid under applicable law, but if any provision or portion of any provision of these Bylaws (including any provision within a single section, paragraph or sentence) is

held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such provision or portion of any provision shall be severable and the invalidity, illegality or unenforceability will not affect any other provision or portion of any provision in such jurisdiction, and these Bylaws will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had never been contained herein.

SECTION VIII

Amendment of Bylaws

Section 8.1.Power to Amend. Except as otherwise provided by law or by the certificate of incorporation or these Bylaws, these Bylaws or any of them may be amended in any respect or repealed at any time, either (i) at any meeting of stockholders, subject to these Bylaws, provided that any amendment or supplement proposed to be acted upon at any such meeting has been described in reasonable detail in the notice of such meeting, or (ii) at any meeting of the Board of Directors, provided in all events that no amendment to any by-law that conflicts or varies with, or frustrates the purposes or effect of, any provision of the certificate of incorporation or other provisions of these Bylaws may be adopted (including, without limitation, any bylaw the purpose or effect of which is to require approvals of matters by supermajority vote of the Board of Directors or a committee) without amendment of such provision of the certificate of incorporation or other provision of the Bylaws in accordance with applicable law and, to the extent otherwise applicable, these Bylaws.

Section 8.2.Approval of Amendments. Notwithstanding the foregoing and anything contained in these Bylaws to the contrary, these Bylaws may not be amended, supplemented, or repealed by the stockholders, and no provision inconsistent in intent, operation, or effect therewith may be adopted by the stockholders, without the affirmative vote of the holders of a majority of the votes cast with respect to adoption, supplementing, or repeal of these Bylaws.

SECTION IX

Adjudication of Disputes

Section 9.1.Exclusive Forum. To the fullest extent permitted by law, and unless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for: (1) any derivative action or proceeding brought in the name or right of the Corporation or on its behalf, (2) any action asserting a claim for breach of a fiduciary duty owed by any director, officer, employee, stockholder or other agent of the Corporation to the Corporation or the Corporation’s stockholders, (3) any action arising or asserting a claim arising pursuant to any provision of the Delaware General Corporation Law or any provision of the Certificate of Incorporation or these Bylaws or as to which the Delaware General Corporation Law confers jurisdiction on the Court of Chancery of the State of Delaware or (4) any action asserting a claim governed by the internal affairs doctrine, including, without limitation, any action to interpret, apply, enforce or determine the validity of the Certificate of Incorporation or these Bylaws. Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of the Corporation shall be deemed to have notice of and consented to the provisions of this Section IX.

Amended August 3, 2017

EX-12.01

Exhibit 12.01

EASTMAN CHEMICAL COMPANY AND SUBSIDIARIES

Computation of Ratios of Earnings to Fixed Charges

	Three months ended June 30,				Six months ended June 30,
(Dollars in millions)	2017		2016		2017		2016
Earnings before income taxes excluding noncontrolling interest	$	357	$	322	$	697	$	645
Add:
Interest expense	69		71		135		141
Appropriate portion of rental expense(1)	8		6		15		13
Amortization of capitalized interest	1		2		2		3
Earnings as adjusted	$	435	$	401	$	849	$	802
Fixed charges:
Interest expense	$	69	$	71	$	135	$	141
Appropriate portion of rental expense(1)	8		6		15		13
Capitalized interest	2		2		4		4
Total fixed charges	$	79	$	79	$	154	$	158
Ratio of earnings to fixed charges	5.5x		5.1x		5.5x		5.1x

⁽¹⁾  For all periods presented, the interest component of rental expense is estimated to equal one-third of such expense. The appropriate portion of rental expense disclosed above for the three months ended June 30, 2016 and six months ended June 30, 2016 has been revised to correct the amounts previously disclosed of $7 million and $15 million, respectively, included in Exhibit 12.01 to the Company's 2016 Quarterly Report on Form 10-Q.

EX-31.01

Exhibit 31.01

EASTMAN CHEMICAL COMPANY AND SUBSIDIARIES

Rule 13a - 14(a)/15d - 14(a) Certifications

I, Mark J. Costa, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Eastman Chemical Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. 

Date:  August 4, 2017

/s/ Mark J. Costa

Mark J. Costa

Chief Executive Officer

EX-31.02

Exhibit 31.02

EASTMAN CHEMICAL COMPANY AND SUBSIDIARIES

Rule 13a - 14(a)/15d - 14(a) Certifications

I, Curtis E. Espeland, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Eastman Chemical Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. 

Date:  August 4, 2017

/s/ Curtis E. Espeland

Curtis E. Espeland

Executive Vice President and Chief Financial Officer

EX-32.01

Exhibit 32.01

EASTMAN CHEMICAL COMPANY AND SUBSIDIARIES

Section 1350 Certifications

In connection with the Quarterly Report of Eastman Chemical Company (the "Company") on Form 10-Q for the period ending June 30, 2017, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), each of the undersigned officers of the Company certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to such officer's knowledge:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.

A signed original of this written statement required by Section 906 has been provided to Eastman Chemical Company and will be retained by Eastman Chemical Company and furnished to the Securities and Exchange Commission or its staff upon request.

Date:  August 4, 2017

/s/ Mark J. Costa

Mark J. Costa

Chief Executive Officer

The foregoing certification is being furnished solely pursuant to 18 U.S.C. §1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-32.02

Exhibit 32.02

EASTMAN CHEMICAL COMPANY AND SUBSIDIARIES

Section 1350 Certifications

In connection with the Quarterly Report of Eastman Chemical Company (the "Company") on Form 10-Q for the period ending June 30, 2017, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), each of the undersigned officers of the Company certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to such officer's knowledge:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.

A signed original of this written statement required by Section 906 has been provided to Eastman Chemical Company and will be retained by Eastman Chemical Company and furnished to the Securities and Exchange Commission or its staff upon request.

Date:  August 4, 2017

/s/ Curtis E. Espeland

Curtis E. Espeland

Executive Vice President and Chief Financial Officer

The foregoing certification is being furnished solely pursuant to 18 U.S.C. §1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-99.01

Exhibit 99.01

MARKED TO SHOW CHANGES OF AUGUST 3, 2017 AMENDMENTS

EASTMAN CHEMICAL COMPANY BYLAWS

SECTION I

Capital Stock

Section 1.1.Certificates. Every holder of stock in the Corporation shall be entitled to have a certificate signed in the name of the Corporation by the Chairman of the Boardof Directors, the Chief Executive Officer, or the Vice Chairmanor a Vice President, and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary of the Corporation certifying the number of shares in the Corporation owned by such holder. Any or all of the signatures on the certificate may be a facsimilean electronic signature. In case any officer, transfer agent, or registrar who has signed or whose facsimileelectronicsignature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if such person were such officer, transfer agent, or registrar at the date of issue.

Section 1.2.Record Ownership. A record of the name and address of the holder of each certificate, the number of shares represented thereby and the date of issue thereof shall be made on the Corporation’s books. The Corporation shall be entitled to treat the holder of record of any share of stock as the holder in fact thereof, and accordingly shall not be bound to recognize any equitable or other claim to or interest in any share on the part of any other person, whether or not it shall have express or other notice thereof, except as required by the laws of the State of Delaware.

Section 1.3.Transfer of Record Ownership. Transfers of stock shall be made on the books of the Corporation only by direction of the person named in the certificate or such person’s attorney, lawfully constituted in writing, and only upon the surrender of the certificate therefor and a written assignment of the shares evidenced thereby, which certificate shall be canceled before the new certificate is issued.

Section 1.4.Lost Certificates. Any person claiming a stock certificate in lieu of one lost, stolen or destroyed shall give the Corporation an affidavit as to such person’s ownership of the certificate and of the facts which go to prove its loss, theft or destruction. Such person shall also, if required by policies adopted by the Board of Directors, give the Corporation a bond, in such form as may be approved by the Corporation, sufficient to indemnify the Corporation against any claim that may be made against it on account of the alleged loss of the certificate or the issuance of a new certificate.

Section 1.5.Transfer Agents; Registrars; Rules Respecting Certificates. The Board of Directors may appoint, or authorize any officer or officers to appoint, one or more transfer agents and one or more registrars. The Board of Directors may make such further rules and regulations as it may deem expedient concerning the issue, transfer and registration of stock certificates of the Corporation.

Section 1.6.Record Date. The Board of Directors may fix in advance a future date, not exceeding 60 days (nor, in the case of a stockholders’ meeting, less than ten days) preceding the date of any meeting of stockholders, payment of dividend or other distribution, allotment of rights, or change, conversion or exchange of capital stock or for the purpose of any other lawful action, as the record date for determination of the stockholders entitled to notice of and to vote at any such meeting and any adjournment or recessthereof, or to receive any such dividend or other distribution or allotment of rights, or to exercise the rights in respect of any such change, conversion or exchange of capital stock, or to participate in any such other lawful action, and in such case such stockholders and only such stockholders as shall be stockholders of record on the date so fixed shall be entitled to such notice of and to vote at such meeting and any adjournment or recessthereof, or to receive such dividend or other distribution or allotment of rights, or to exercise such rights, or to participate in any such other lawful action, as the case may be, notwithstanding any transfer of any stock on the books of the Corporation after any such record date fixed as aforesaid.

SECTION II

Meetings of Stockholders

Section 2.1.Annual. The annual meeting of stockholders for the election of directors and the transaction of such other proper business shall be held on the first Thursday in May, unless otherwise specified by resolution adopted by the Board of Directors, andat the time and place, within or without the State of Delaware, as determined by the Board of Directors. The Board of Directors may, at any time prior to the holding of an annual meeting of stockholders, and for any reasonable reason, postpone, reschedule or cancel any annual meeting of stockholders previously scheduled by the Board of Directors.

Section 2.2.Special. (a) Special meetings of stockholders for any purpose or purposes may be called only by the Board of Directors,(i) pursuant to a resolution adopted by a majority of the members of the Board of Directors then in office,or (ii) upon the written request of the holders of at least twenty-five percent of the outstanding voting stock of the Corporation (a “Request”) in accordance with the requirements set forth in Section 2.2(b) hereof.

(b)Any Request shall set forth with particularityas to each Meeting Proponent (as defined below),(i) the names and business addresses of the stockholder or stockholders requesting the meeting (each a “Meeting Proponent”) and all Persons (as such term is defined in Article V of the Certificate of Incorporation) acting in concert with anysuchMeeting Proponent; (ii) the name and address of each Meeting Proponentand the Persons identified in clause (i), as they appear on the Corporation’s books (if they so appear); (iii) (A)the class or series, if any, and number of shares of the Corporation that are, directly or indirectly, beneficially owned by each Meeting Proponentand the Persons identified in clause (i), (B) any option, warrant, forward contract, contract of sale, convertible security, stock appreciation right, swap or similar right, instrument or agreement with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of shares of the Corporation or with a value derived in whole or in part from the value of any class or series of shares of the Corporation, whether or not such right, instrument or agreement shall be subject to settlement in the underlying class or series of stock of the Corporation or otherwise (a “Derivative Instrument”), directly or indirectly, owned beneficially by such Meeting Proponent and any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the value of shares of the Corporation, (C) a description of any proxy, contract, arrangement, understanding or relationship pursuant to which such Meeting Proponent has a right to vote any shares of any security of the Corporation, (D) any Short Interest in any security of the Corporation (for purposes of these Bylaws a person shall be deemed to have a “Short Interest” in a security if such person, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, has the opportunity to profit or share in any profit derived from any decrease in the value of the subject security), (E) any rights to dividends on the shares of the Corporation owned beneficially by such Meeting Proponent that are separated or separable from the underlying shares of the Corporation, (F) any proportionate interest in shares of the Corporation or Derivative Instruments held, directly or indirectly, by a general or limited partnership in which such Meeting Proponent is a general partner or, directly or indirectly, beneficially owns an interest in a general partner and (G) any performance-related fees (other than an asset-based fee) that such Meeting Proponent is entitled to based on any increase or decrease in the value of shares of the Corporation or Derivative Instruments, if any, including, without limitation, any such interests held by members of such Meeting Proponent’s immediate family sharing the same household;(iv) the text of the proposal or business (including the text of any resolutions proposed for consideration and, if the business includes a proposal to amend these Bylaws or the Certificate of Incorporation, the language of the proposed amendment); and(v) all arrangements or understandings between each Meeting Proponent and any other Persons, including their names, in connection with the proposed business of the special meetingand any material interest of each Meeting Proponent in such business;(vi) a representation that the Meeting Proponent is a holder of record of stock of the Corporation entitled to vote at such special meeting, will continue to be a holder of record of stock entitled to vote at such meeting through the date of the special meeting and intends to appear in person or by proxy at the special meeting to bring such proposal or business before the meeting; (vii) a description of any material interests in such proposal or business of the Meeting Proponent; and (viii) a representation as to whether such Meeting Proponent intends or is part of a group that intends to deliver a proxy statement and form of proxy to holders of at least the percentage of the voting power of the Corporation’s outstanding stock required to approve or adopt the proposal or business. The information required under this Section 2.2(b) shall be supplemented and updated by such Meeting Proponent as described under Section 2.7(f). Except as permitted in Section 2.2(c), the only business that may be

conducted at the special meeting shall be the business proposed in the Requestand any business proposed by the Board of Directors. The Request shall be delivered personally or sent by registered mail to the Secretary of the Corporation at its principal executive offices. If the Board of Directors determines that the Request complies with the Certificate of Incorporation and the provisions of these Bylaws and that the proposal to be considered or business to be conducted is a proper subject for stockholder action under applicable law, the Board of Directors shall call and send notice of a special meeting for the purpose set forth in the Request in accordance with Section 2.3 of these Bylaws. The Board of Directors shall determine the date for such special meeting, which date shall be not later than 90 days following the Corporation’s receipt of the Request, and the record date(s) for stockholders entitled to notice of and to vote at such special meeting.

(c)Special meetings may be held at any place, within or without the State of Delaware, as determined by the Board of Directors. The Board of Directors may, at any time prior to the holding of a special meeting of stockholders, and for any reasonable reason, postpone, reschedule or cancel any special meeting of stockholders previously scheduledby the Board of Directors. The only business which may be conducted at a special meeting, other than procedural matters and matters relating to the conduct of the special meeting, shall be the matter or matters described in the notice of the meetinggiven by the Board of Directors.

(d) For purposes of these Bylaws, the term “Meeting Proponent” shall mean (i) the stockholder providing the Request, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the Request is made, (iii) any affiliate or associate (each within the meaning of Rule 12b-2 under the Securities Exchange Act of 1934 (the “Exchange Act”) for purposes of these Bylaws) of each such stockholder or beneficial owner and (iv) any other person with whom such stockholder or beneficial owner (or any of their respective affiliates or associates) is forming a group (within the meaning of Section 13(d) under the Exchange Act).

Section 2.3.Notice. NoticeThe Board of Directors shall give noticeof each meeting of stockholders, shall be madein writing, orelectronically to such stockholders as have consented to the receipt of such notice by electronic means, or by any such other means permitted by the Delaware General Corporation Law. Such notice shall state the date, time, place and, in the case of a special meeting, the purpose thereof, shall be given as provided by law by the Secretary or an Assistant Secretary not less than ten days nor more than 60 days before such meeting (unless a different time is specified by law) to every stockholder entitled by law to notice of such meeting.

Section 2.4.List of Stockholders. A complete list of the stockholders entitled to vote at any meeting of stockholders, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder, shall be prepared by the Secretary. Such list shall be available for examination of any stockholder, for any purpose germane to the meeting, either on a reasonably accessible electronic network or, during normal business hours, at the Corporation’s principal place of business, for at least ten days before the meeting and at the place of the meeting during the whole time of the meeting. In the event that such list is to be made available on an electronic network, the notice of meeting given under Section 2.3 hereof shall provide the information required to gain access to such list.

Section 2.5.Quorum; Adjournment and Recess. The holders of shares of stock entitled to cast a majority of the votes on the matters at issue at a meeting of stockholders, present in person or represented by proxy, shall constitute a quorum, except as otherwise required by the Delaware General Corporation Law. In the event of a lack of a quorum, theFor the avoidance of doubt, abstentions and broker non-votes shall be treated as present for purposes of determining the presence or absence of a quorum. The chairman of the meeting or a majority in interest of the stockholders present in person or represented by proxymay adjourn or recessthe meeting fromat anytime to timeand for any reasonable reason,without notice other than announcement at the meeting, untilwhether or not there is sucha quorumshall be obtained. At any such adjourned or recessedmeeting at which there is a quorum, any business may be transacted that might have been transacted at the meeting originally called.

Section 2.6.Organization and Procedure. (a) The Chairman of the Boardor, the Chief Executive Officerif the Chairman of the Board is not available,orthe Lead Director, or, if the Lead Director is not available,such other officer of the Corporation designated by a majority of the directors that the Corporation would have if there were no vacancies on the Board of Directors (the “Whole Board”), will call meetings of the stockholders to order and will act as presiding officerthe chairman of the meetingthereof. Unless otherwise determined prior to the meeting by a majority

of the Whole Board, the presiding officerchairmanof the meeting of the stockholders will have the right and the authority to determine and maintain the rules, regulations and procedures for the proper conduct of the meeting, including, without limitation, (i)restricting entry to the meeting after it has commenced, (ii)maintaining order and the safety of those in attendance, (iii)opening and closing the polls for voting, (iv)dismissing business or proposals not properly submitted, (v)limiting the time allowed for discussion of the business of the meeting, (vi)restricting the persons (other than stockholders of the Corporation or their duly appointed proxies) that may attend the meeting, and(vii)ascertaining whether any stockholder or proxy holder may be excluded from the meeting based upon any determination by the presiding officerchairman of the meeting, in his or her sole discretion, that the stockholder or proxy holder is unduly disruptive or is likely to disrupt the meetingand (viii) restricting the use of cell phones, audio or video recording devices and similar devices at the meeting. The Secretary of the Corporation shall act as secretaryof the meeting, but in the absence of the Secretary, the presiding officerchairman of the meetingmay appoint a secretaryof the meeting.

(b)At an annual meeting of the stockholders, only such business will be conducted or considered as is properly brought before the meeting. To be properly brought before an annual meeting, business must be (i) specified in the notice of meeting (or any supplement thereto) given by the Board of Directorsin accordance with these bylawsBylaws, (ii) brought before the meeting by the presiding officerchairman of the meetingor by or at the direction of a majority of the Whole Board, or (iii) otherwise properly requested to be brought before the meeting by a stockholder of the Corporation in accordance with these bylawsBylaws and applicable law.

(c)At a special meeting of stockholders, only such business may be conducted or considered as is properly brought before the meeting. To be properly brought before a special meeting, business must be (i) specified in the notice of the meeting (or any supplement thereto) given by the Board of Directorsin accordance with these bylawsBylawsor (ii) brought before the meeting by the presiding officerchairman of the meetingor by or at the direction of a majority of the Whole Board.

(d)The determination of whether any business sought to be brought before any annual or special meeting of the stockholders is properly brought before such meeting will be made by the presiding officerchairmanof the meeting. If the presiding officerchairman of the meetingdetermines that any business is not properly brought before such meeting, he or she will so declare at the meeting and any such business will not be conducted or considered.

Section 2.7.Stockholder Nominations and Proposals. (a) No Stockholder Nomination (as defined below) or anyproposal for a stockholder vote on any other business (a “Stockholder Proposal”)shall be submitted by a stockholder (a “Stockholder Proposal”)to the Corporation’s stockholders unless the stockholder submitting such proposal (the “Proponent”) shall have filedeach Proponent (as defined below) has submitted to the Secretarya written notice setting forth with particularity as to each Proponent(i) the names and business addresses of the Proponent and all Persons (as such term is defined in Article V of the Certificate of Incorporation) acting in concert with theeachProponent; (ii) the name and address of theeachProponent and the Persons identified in clause (i),as they appear on the Corporation’s books (if they so appear); (iii) (A)the class or series, if any,and number of shares of the Corporation that are, directly or indirectly,beneficially owned by the Proponent and the Persons identified in clause (i); (iv) a description of the Stockholder Proposaleach Proponent, (B) any Derivative Instruments that are, directly or indirectly, beneficially owned by each Proponent and any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the value of shares of the Corporation, (C) a description of any proxy, contract, arrangement, understanding or relationship pursuant to which such Proponent has a right to vote any shares of any security of the Corporation, (D) any Short Interest in any security of the Corporation, (E) any rights to dividends on the shares of the Corporation beneficially owned by such Proponent that are separated or separable from the underlying shares of the Corporation, (F) any proportionate interest in shares of the Corporation or Derivative Instruments held, directly or indirectly, by a general or limited partnership in which such Proponent is a general partner or, directly or indirectly, beneficially owns an interest in a general partner and (G) any performance-related fees (other than an asset-based fee) that such Proponent is entitled to based on any increase or decrease in the value of shares of the Corporation or Derivative Instruments, if any, including, without limitation, any such interests held by members of such Proponent’s immediate family sharing the same household; (iv) a description of the Stockholder Proposal or Stockholder Nomination, as applicable, containing all material information relating thereto; and (vincluding any information relating to such Proponent that would be required to be disclosed in a proxy statement or other filing required to be

made in connection with solicitations of proxies or consents for, as applicable, the Stockholder Proposal or the Stockholder Nomination in a contested election pursuant to Section 14 of the Exchange Act and the regulations promulgated thereunder; (v) the text of the Stockholder Proposal (including the text of any resolutions proposed for consideration and, if the business includes a proposal to amend these Bylaws or the Certificate of Incorporation, the language of the proposed amendment); (vi) all arrangements or understandings between each Proponent and any other Persons (as such term is defined in Artilce V of the Certificate of Incorporation), including their names, in connection with the Stockholder Proposal or Stockholder Nomination; (vii) a representation that the Proponent is a holder of record of stock of the Corporation entitled to vote at a meeting of stockholders, will continue to be a holder of record of stock entitled to vote at such meeting through the date of the meeting and intends to appear in person or by proxy at the meeting to bring such Stockholder Proposal or Stockholder Nomination before the meeting; (viii) a description of any material interests in such Stockholder Proposal or Stockholder Nomination of the Proponent on whose behalf the proposal or nomination is made; (ix) a representation as to whether such Proponent intends or is part of a group that intends to deliver a proxy statement or form of proxy to holders of at least the percentage of the voting power of the Corporation’s outstanding stock required to approve or adopt the Stockholder Proposal or Stockholder Nomination; and (x) such other information as the Board of Directors reasonably determines is necessary or appropriate to enable the Board of Directors and stockholders of the Corporation to consider the Stockholder Proposal. The presiding officeror Stockholder Nomination. The information required under this Section 2.7(a) shall be supplemented and updated by each Proponent as described under Section 2.7(f). The chairman of the meetingat any stockholders’ meeting may determine that any Stockholder Proposal or Stockholder Nominationwas not made in accordance with the procedures prescribed in these Bylaws or is otherwise not in accordance with applicablelaw, and if it is so determined, such officer shall so declare at the meeting and the Stockholder Proposal or Stockholder Nominationshall be disregarded.

(b)Only persons who are selected and recommended by the Board of Directors or the committee of the Board of Directors designated to make recommendations, or who are nominated by stockholders in accordance with the procedures set forth in this Section 2.7 (a “Stockholder Nomination”) and the procedures set forth in Section 2.8, shall be eligible for election, or qualified to serve, as directors. Nominations of individuals for election to the Board of Directors of the Corporation at any annual meeting or any special meeting of stockholders at which directors are to be elected may be made by any stockholder of the Corporation entitled to vote for the election of directors at that meeting by compliance with the procedures set forth in this Section 2.7 or the procedures set forth in Section 2.8. Nominations by stockholders under this Section 2.7 shall be made by written notice (a “Nomination Notice”), which shall set forth (i)as to each individual nominated,; (Ai) the name, date of birth, business address and residence address of such individual; (Bii) the business experience during the past five years of such nominee, including his or her principal occupations and employment during such period, the name and principal business of any corporation or other organization in which such occupations and employment were carried on, and such other information as to the nature of his or her responsibilities and level of professional competence as may be sufficient to permit assessment of his or her prior business experience; (Ciii) whether the nominee is or has ever been at any time a director, officer or owner of 5% or more of any class of capital stock, partnership interests or other equity interest of any corporation, partnership or other entity; (Div) any directorships currently held, or held within the preceding five years, by such nominee in any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, or subject to the requirements of Section 15(d) of such Act or any company registered as an investment company under the Investment Company Act of 1940, as amended; (Ev) whether, in the last ten years, such nominee has been subject to any event specified in Item 401(f) of Regulation S-K of the Securities Exchange Act of 1934 or any successor provision which may be material to an evaluation of the ability or integrity of the nominee; (Fvi) whether the nominee is a party to any compensatory, payment or other financial agreement, arrangement or understanding with any person or entity other than the Corporation, or has received any such compensation or other payment from any person or entity other than the Corporation, in each case in connection with candidacy or service as a director of the Corporation (a “Third-Party Compensation Arrangement”); and (Gvii) all information relevant to a determination of the nominee’s status as to “independence,” including references to the criteria established by the New York Stock Exchange (or any other exchange or quotation system on which the Corporation’s equity securities are then listed or quoted) and the Corporation’s Corporate Governance Guidelines, in each case as in effect at the time of such Stockholder Nomination; and.

(iic)as to the Person submitting the Nomination Notice and any Person acting in concert with such Person, (x) the name and business address of such Person, (y) the name and address of such Person as they appear on the

Corporation’s books (if they so appear), and (z) the class and number of shares of the Corporation that are beneficially owned by such Person. TheEachNomination Notice shall include (1) a written consent to being named in a proxy statement as a nominee, and to serve as a director if elected, signed by the nominee, (2) a written representation (in a form deemed satisfactory by the Secretary) that the nomineei) a written representation and agreement in the form required by the Corporation (which form the Proponent shall request from the Secretary and shall be provided by the Corporation within ten (10) days of such request) signed by the nominee that the nominee (A)has read and agrees, if elected to serve as a member of the Board of Directors, to adhere to the Corporation’s Corporate Governance Guidelines and any other Corporation policies and guidelines applicable to directors, (3B) a written representation and agreement (in the form provided by the Secretary upon written request) signed by the nominee that the nomineeis not and will not become a party to any Third-Party Compensation Arrangement orthat has not been disclosed to the Corporation, (C) is not and will not become a party to (1)any agreement, arrangement or understanding (whether written or oral)with any person or entity as to how the nominee would vote or act on any issue or question as a director (a “Voting Commitment”), in each case that has not been disclosed to the Corporation. If the presiding officer, or (2) any Voting Commitment that could limit or interfere with such nominee’s ability to comply, if elected to serve as a member of the Board of Directors, with such nominee’s fiduciary duties under applicable law, (D) in such nominee’s individual capacity and on behalf of each Proponent on whose behalf the nomination is being made, would be in compliance, if elected to serve as a member of the Board of Directors, and will comply with all applicable law and all applicable rules of the U.S. exchanges upon which the capital stock of the Corporation is listed, (E) in such nominee’s individual capacity and on behalf of each Proponent on whose behalf the nomination is being made, intends to serve a full term if elected to serve as a member of the Board of Directors and (F) will provide facts, statements and other information in all communications with the Corporation and its stockholders that are or will be true and correct in all material respects and do not and will not omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; and (ii) a written questionnaire with respect to the background and qualification of such nominee and the background of any other person or entity on whose behalf the nomination is being made in the form required by the Corporation (which form the Proponent shall request from the Secretary and shall be provided by the Corporation within ten (10) days of such request). If the chairman of the meetingat any stockholders’ meeting determines that a nomination was not made in accordance with the procedures prescribed by these Bylawsor is otherwise not in accordance with applicable law, he shall so declare to the meeting and the defective nomination shall be disregarded.

(cd)In the case of an annual meeting of stockholders, Nomination Notices and Stockholder Proposals shall be delivered to the Secretary at the principal executive office of the Corporation no earlier than 150 days and not later than 120 days prior to the date on which the notice of the immediately preceding year’s annual meeting of stockholders was first sent to the stockholders of the Corporation, provided that in the event that the date of suchtheannual meeting is more than 30 days before or 70 days after its anniversary date, the Nomination Notice and Stockholder Proposals must be so delivered not later than the later of (i) 120 days prior to such annual meeting or (ii) 10 days following the day on which a public announcement of the annual meeting date is first made. In the case of a special meeting of stockholders, Nomination Notices and Stockholder Proposals shall be delivered to the Secretary at the principal executive office of the Corporation no later than the close of business on the 15th day following the day on which notice of the date of a special meeting of stockholders was given.Stockholder Proposals may be brought before the meeting only upon a proper request in accordance with Section 2.2(a)(ii).

(e)For purposes of these Bylaws, the term “Proponent” shall mean (i) the stockholder providing the Stockholder Proposal or Stockholder Nomination, as applicable, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the Stockholder Proposal or Stockholder Nomination is made, (iii) any affiliate or associate (each within the meaning of Rule 12b-2 under the Exchange Act for purposes of these Bylaws) of such stockholder or beneficial owners and (iv) any other person with whom such stockholder or beneficial owner (or any of their respective affiliates or associates) is forming a group.

(f)A stockholder providing notice of a Stockholder Proposal or Stockholder Nomination, as applicable, shall supplement and update such notice, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 2.7 shall be true and correct (i) as of the record date for the meeting and (ii) as of the date that is ten business days prior to the meeting or any adjournment, recess, cancellation, rescheduling or postponement thereof, and such supplement and update shall be delivered to, or mailed and received by, the Secretary at the principal

executive offices of the Corporation not later than five business days after the record date for the meeting (in the case of the supplement and update required to be made as of the record date) and not later than seven business days prior to the date for the meeting, if practicable (or, if not practicable, on the first practicable date prior to any adjournment, recess or postponement thereof (in the case of the supplement and update required to be made as of ten business days prior to the meeting or any adjournment, recess or postponement thereof)).

(g) Notwithstanding the foregoing provisions of this Section 2.7, a stockholder shall also comply with all applicable requirements of state law and of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in these Bylaws; provided, however, that any references in these Bylaws to the Exchange Act or the rules promulgated thereunder are not intended to and shall not limit the requirements applicable to Stockholder Nominations or Stockholder Proposals pursuant to this Section 2.7. Nothing in this Section 2.7 shall be deemed to affect any rights of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act.

Section 2.8.Inclusion of Director Nominations by Stockholders in the Corporation’s Proxy Materials.

(a)Subject to the terms and conditions set forth in these Bylaws (including the provisions of Section 2.7 concerning Stockholder Nominations)and applicable law, the Corporation shall include in its proxy statement and form of proxy (hereinafter, the “proxy materials”) for an annual meeting of stockholders for the election of directors, in addition to the persons selected and recommended for election by the Board of Directors or any committee thereof, the name, together with the Required Information (defined below), of any person nominated for election (the “Proxy Access Stockholder Nominee”) to the Board of Directors by one or more Stockholders that satisfies the notice, ownership and other requirements of this Section 2.8 (such person or group who nominates a Proxy Access Stockholder Nominee, the “Eligible Stockholder”).

(b)To nominate a Proxy Access Stockholder Nominee, the Eligible Stockholder must provide a written notice that expressly elects to have its Proxy Access Stockholder Nominee included in the Corporation’s proxy materials pursuant to this Section 2.8 (the “Notice of Proxy Access Nomination”). To be timely, a Notice of Proxy Access Nomination must be delivered to the Secretary at the principal executive office of the Corporation during the period for delivery of Nomination Notices and Stockholder Proposals described in Section 2.7(c) of these Bylaws (the last day on which a Notice of Proxy Access Nomination may be delivered, the “Final Proxy Access Nomination Date”). In addition to other requirements set forth in this Section 2.8, the Notice of Proxy Access Nomination must include the name and address of the Eligible Stockholder (including each stockholder and beneficial owner whose stock ownership is counted for the purposes of qualifying as an Eligible Stockholder).

(c)For purposes of this Section 2.8, the “Required Information” that the Corporation will include in its proxy materials is (i) the information concerning the Proxy Access Stockholder Nominee and the Eligible Stockholder that the Corporation determines is required to be disclosed in the Corporation’s proxy materials by the regulations promulgated under the Securities Exchange Act of 1934; and (ii) if the Eligible Stockholder so elects, a Statement (defined below). Nothing in this Section 2.8 shall limit the Corporation’s ability to solicit against and include in its proxy materials its own statements relating to any Proxy Access Stockholder Nominee.

(d)The maximum number of Proxy Access Stockholder Nominees (including Proxy Access Stockholder Nominees that were submitted by an Eligible Stockholder for inclusion in the Corporation’s proxy materials pursuant to this Section 2.8 but either are subsequently withdrawn or that the Board of Directors decides to select and recommend as Board of Director nominees under Section 2.7 of these Bylaws) that may appear in the Corporation’s proxy materials with respect to an annual meeting of stockholders shall not exceed 20% of the number of directors in office as of the Final Proxy Access Nomination Date, or if such number is not a whole number, the closest whole number below 20% (the “Permitted Number”) but not less than one; provided, however, that the Permitted Number shall be reduced by the number of such director candidates for which the Corporation shall have received one or more valid notices that a stockholder (other than an Eligible Stockholder) intends to nominate director candidates at such applicable annual meeting of stockholders pursuant to Section 2.7 of these Bylaws; provided, further, that in the event that one or more vacancies for any reason occurs on the Board of Directors at any time after the Final Proxy Access Nomination Date and before the date of the applicable annual meeting of stockholders and the Board of Directors reduces the size of

the Board of Directors in connection therewith, the Permitted Number shall be calculated based on the number of directors in office as so reduced. In the event that the number of Proxy Access Stockholder Nominees submitted by Eligible Stockholders pursuant to this Section 2.8 exceeds the Permitted Number, each Eligible Stockholder will select one Proxy Access Stockholder Nominee for inclusion in the Corporation’s proxy materials until the Permitted Number is reached, with preference provided based on the number (largest to smallest) of shares owned by each Eligible Stockholder pursuant to this Section 2.8. If the Permitted Number is not reached after each Eligible Stockholder has selected one Proxy Access Stockholder Nominee, this selection process will continue as many times as necessary, following the same order each time, until the Permitted Number is reached.

(e)An Eligible Stockholder is one or more stockholders who owns and has ownedcontinuously, or are acting on behalf of one or more beneficial owners who own and have owned (as defined below)continuously, for at least three years as of the date the Notice of Proxy Access Nomination is received by the Corporation, shares representing at least 3% of the voting power entitled to vote generally in the election of directors (the “Required Shares”), and who continue to own the Required Shares at all times between the date the Notice of Proxy Access Nomination is received by the Corporation and the date of the applicable annual meeting of stockholders, provided that the aggregate number of stockholders, and, if and to the extent that a stockholder is acting on behalf of one or more beneficial owners, of such beneficial owners, whose stock ownership is counted for the purposes of satisfying the foregoing ownership requirement shall not exceed twenty (20). Two or more funds that are (i) under common management and investment control or (ii) under common management and funded primarily by a single employer (such funds together under each of (i) or (ii) comprising a “Qualifying Fund”) shall be treated as one stockholder for the purpose of determining the aggregate number of stockholders in this Section 2.8(e), and treated as one person for the purpose of determining ownership in Section 2.8(f), provided that each fund comprising a Qualifying Fund otherwise meets the requirements set forth in this Section 2.8. No stockholder or beneficial holder may be a member of more than one group constituting an Eligible Stockholder under this Section 2.8.

(f)For purposes of calculating the Required Shares, “ownership” shall be deemed to consist of and include only the outstanding shares as to which a person possesses both (i) the full voting and investment rights pertaining to the shares and (ii) the full economic interest in (including the opportunity for profit and risk of loss on) such shares; provided that the ownership of shares calculated in accordance with clauses (i) and (ii) shall not include any shares (A) that a person has sold in any transaction that has not been settled or closed, (B) that a person has borrowed or purchased pursuant to an agreement to resell or (C) subject to any option, warrant, forward contract, swap, contract of sale, other derivative or similar agreement entered into by a person, whether any such instrument or agreement is to be settled with shares or with cash based on the notional amount or value of shares, in any such case which instrument or agreementDerivative Instrument, in any such case which Derivative Instrumenthas, or is intended to have, the purpose or effect of (1) reducing in any manner, to any extent or at any time in the future, the person’s full right to vote or direct the voting of any such shares, or (2) hedging, offsetting or altering to any degree gain or loss arising from the full economic ownership of such person’s shares. “Ownership” shall include shares held in the name of a nominee or other intermediary so long as the person claiming ownership of such shares retains the right to instruct how the shares are voted with respect to the election of directors and possesses the full economic interest in the shares, provided that this provision shall not alter the obligations of any stockholder to provide the Notice of Proxy Access Nomination. Ownership of shares shall be deemed to continue during any period in which shares have been loaned if the person claiming ownership has the power to recall such loaned shares on three business days’ notice and the person recalls the loaned shares within three business days of being notified that its Proxy Access Stockholder Nominee will be included in the Corporation’s proxy materials for the applicable annual meeting, and the person holds the recalled shares through such annual meeting. Ownership of shares shall be deemed to continue during any period in which any voting power has been delegated by means of a proxy, power of attorney or other instrument or arrangement which is revocable at any time without condition. For purposes of this Section 2.8, the determination of the extent of “ownership” of shares shall be made in good faith by the Board of Directors, which determination shall be conclusive and binding on the Corporation and the stockholders. An Eligible Stockholder shall include in its Notice of Proxy Access Nomination the number of shares it is deemed to own for the purposes of this Section 2.8.

(g)No later than the Final Proxy Access Nomination Date, an Eligible Stockholder (including each stockholder, fund comprising a Qualifying Fund and beneficial owner whose stock ownership is counted for the purposes of qualifying as an Eligible Stockholder) must provide the following information in writing to the Secretary: (i) all of the

information required pursuant to Section 2.7(b) as if the Notice of Proxy Access Nomination was a Nomination Notice; (ii) one or more written statements from the record holder of the shares (and from each intermediary through which the shares are or have been held during the requisite three-year holding period) verifying that, as of the date the Notice of Proxy Access Nomination is sent to the Corporation, the Eligible Stockholder owns, and has owned continuously for the preceding three years, the Required Shares, and the Eligible Stockholder’s agreement to provide (A) within five business days after the record date for the applicable annual meeting, written statements from the record holder and intermediaries verifying the Eligible Stockholder’s continuous ownership of the Required Shares through the record date, and (B) immediate notice if the Eligible Stockholder ceases to own any of the Required Shares prior to the date of the applicable annual meeting of stockholders; (iii) the written consent of each Proxy Access Stockholder Nominee to being named in the Corporation’s proxy materials as a nominee and to serving as a director if elected; and (iv) a copy of the Schedule 14N that has been filed with the Securities and Exchange Commission as required by Rule 14a-18 under the Securities Exchange Act of 1934. In addition, no later than the Final Proxy Access Nomination Date, an Eligible Stockholder (including each stockholder, fund comprising a Qualifying Fund and beneficial owner whose stock ownership is counted for purposes of qualifying as an Eligible Stockholder) must provide to the Secretary a signed and written (i) representation of the Eligible Stockholder that such Eligible Stockholder (A) acquired the Required Shares in the ordinary course of business and not with the intent to change or influence control of the Corporation, and does not presently have such intent, (B) intends to maintain qualifying ownership of the Required Shares through the date of the applicable annual meeting of stockholders, (C) has not nominated and will not nominate for election to the Board of Directors at the applicable annual meeting of stockholders any person other than its Proxy Access Stockholder Nominee, (D) has not engaged and will not engage in, and has not and will not be a “participant” in another person’s, “solicitation” within the meaning of Rule 14a-1(l) under the Securities Exchange Act of 1934 in support of the election of any individual as a director at the applicable annual meeting of stockholders other than its Proxy Access Stockholder Nominee(s) or a nominee of the Board of Directors, (E) will not distribute to any stockholder any form of proxy for the applicable annual meeting of stockholders other than the form distributed by the Corporation, and (F) will provide facts, statements and other information in all communications with the Corporation and its stockholders that are or will be true and correct in all material respects and do not and will not omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading and otherwise will comply with all applicable laws, rules and regulations in connection with any actions taken pursuant to this Section 2.8; (ii) in the case of a nomination by a group of stockholders that together constitutes an Eligible Stockholder, designation by all such group members of one group member that is authorized to act on behalf of all members of the nominating stockholder group with respect to the nomination and matters related thereto, including withdrawal of the nomination; and (iii) undertaking that the Eligible Stockholder agrees to (A) assume all liability stemming from any legal or regulatory violation arising out of the Eligible Stockholder’s communications with the stockholders of the Corporation or out of the information that the Eligible Stockholder provided to the Corporation, (B) indemnify and hold harmless the Corporation and each of its directors, officers and employees individually against any liability, loss or damages in connection with any threatened or pending action, suit or proceeding, whether legal, administrative or investigative, against the Corporation or any of its directors, officers or employees arising out of any nomination, solicitation or other activity by the Eligible Stockholder in connection with its efforts to elect the Proxy Access Stockholder Nominee pursuant to this Section 2.8, and (C) file with the Securities and Exchange Commission any solicitation or other communication with the Corporation’s stockholders relating to the meeting at which the Proxy Access Stockholder Nominee will be nominated, regardless of whether any such filing is required under Regulation 14A of the Securities Exchange Act of 1934 or whether any exemption from filing is available for such solicitation or other communication under Regulation 14A of the Securities Exchange Act of 1934. In addition, no later than the Final Proxy Access Nomination Date, a Qualifying Fund whose stock ownership is counted for purposes of qualifying as an Eligible Stockholder must provide to the Secretary documentation reasonably satisfactory to the Board of Directors that demonstrates that the funds comprising the Qualifying Fund are either (i) under common management and investment control or (ii) under common management and funded primarily by a single employer.

(h)The Eligible Stockholder may provide to the Secretary, at the time the information required by this Section 2.8 is provided, a written statement for inclusion in the Corporation’s proxy materials for the applicable annual meeting of stockholders, not to exceed 500 words, in support of the Eligible Stockholder’s Proxy Access Stockholder Nominee (the “Statement”). Notwithstanding anything to the contrary contained in this Section 2.8, the Corporation may omit

from its proxy materials any information or Statement (or portion thereof) that it, in good faith, believes would violate any applicable law or regulation.

(i)No later than the Final Proxy Access Nomination Date, each Proxy Access Stockholder Nominee must: (i) provide to the Secretary all of the consents, representations, and agreements required pursuant to Section 2.7(b) as if the Proxy Access Stockholder Nominee was a nominee; (ii) submit to the Secretary all completed and signed questionnaires required of the Corporation’s directors and nominees for election to the Board of Directors within five business days of receipt of each such questionnaire from the Corporation; and (iii) provide to the Secretary within five business days of the Corporation’s request such additional information as the Corporation determines may be necessary to permit the Board of Directors to determine (A) such Proxy Access Stockholder Nominee’s status as to “independence”, including references to the criteria established by the New York Stock Exchange (or any other exchange or quotation system on which the Corporation’s equity securities are listed), any applicable rules of the Securities and Exchange Commission and the Corporation’s Corporate Governance Guidelines, (B) if such Proxy Access Stockholder Nominee has any direct or indirect relationship with the Corporation other than those relationships that have been deemed categorically immaterial pursuant to the Corporation’s Corporate Governance Guidelines, and (C) if such Proxy Access Stockholder Nominee is not and has not been subject to any event specified in Item 401(f) of Regulation S-K of the Securities Exchange Act of 1934 or any successor provision. In the event that any information or communications provided by the Eligible Stockholder or the Proxy Access Stockholder Nominee to the Corporation or its stockholders ceases to be true and correct in any respect or omits a fact necessary to make the statements made, in light of the circumstances under which they were made, not misleading, each Eligible Stockholder or Proxy Access Stockholder Nominee, as the case may be, shall promptly notify the Secretary of any such inaccuracy or omission in such previously provided information and of the information that is required to make such information or communication true and correct.

(j)Any Proxy Access Stockholder Nominee who is included in the Corporation’s proxy materials for a particular annual meeting of stockholders but either (i) withdraws from or becomes ineligible or unavailable for election at that annual meeting, or (ii) does not receive at least 25% of the votes cast in favor of the Proxy Access Stockholder Nominee’s election, will be ineligible to be a Proxy Access Stockholder Nominee pursuant to this Section 2.8 for the next two annual meetings of stockholders. Any Proxy Access Stockholder Nominee who is included in the Corporation’s proxy statement for a particular annual meeting of stockholders, but subsequently is determined not to satisfy the eligibility requirements of this Section 2.8 or any other provision of the Corporation’s Bylaws, Certificate of Incorporation, Corporate Governance Guidelines or other applicable regulation at any time before the applicable annual meeting of stockholders, will not be eligible for election at the relevant annual meeting of stockholders and may not be substituted by the Eligible Stockholder that nominated such Proxy Access Stockholder Nominee. Any Eligible Stockholder (including each stockholder, fund comprising a Qualifying Fund or beneficial owner whose stock ownership is counted for the purposes of qualifying as an Eligible Stockholder) whose Proxy Access Stockholder Nominee is elected as a director at the annual meeting of stockholders will not be eligible to nominate or participate in the nomination of a Proxy Access Stockholder Nominee for the following two (2) annual meetings of stockholders other than the nomination of such previously elected Proxy Access Stockholder Nominee.

(k)The Corporation shall not be required to include, pursuant to this Section 2.8, a Proxy Access Stockholder Nominee in its proxy materials for any meeting of stockholders, or, if the proxy statement already has been filed, to allow the nomination of a Proxy Access Stockholder Nominee, notwithstanding that proxies in respect of such vote may have been received by the Corporation: (i) if the Proxy Access Stockholder Nominee or the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) who has nominated such Proxy Access Stockholder Nominee has engaged in or is currently engaged in, or has been or is a “participant” in another person’s, “solicitation” within the meaning of Rule 14a-1(l) under the Securities Exchange Act of 1934 in support of the election of any individual as a director at the applicable annual meeting of stockholders other than its Proxy Access Stockholder Nominee(s) or a nominee of the Board of Directors; (ii) if another person is engaging in a “solicitation” within the meaning of Rule 14a-1(l) under the Securities Exchange Act of 1934 in support of the election of any individual as a director at the applicable annual meeting of stockholders other than a nominee of the Board of Directors; (iii) who is not independent under the listing standards of each principal U.S. exchange upon which the common stock of the Corporation is listed, any applicable rules of the Securities and Exchange Commission, and any publicly disclosed standards used by the Board of Directors in determining and disclosing independence of the

Corporation’s directors, in each case as determined by the Board of Directors; (iv) who does not meet the audit committee independence requirements under the rules of any stock exchange on which the Corporation’s securities are traded, is not a “non-employee director” for the purposes of Rule 16b-3 under the Securities Exchange Act of 1934 (or any successor rule), is not an “outside director” for the purposes of Section 162(m) of the Internal Revenue Code (or any successor provision); (v) whose election as a member of the Board of Directors would cause the Corporation to be in violation of these Bylaws, the Certificate of Incorporation, the rules and listing standards of the principal U.S. securities exchanges upon which the common stock of the Corporation is listed, or any applicable state or federal law, rule or regulation; (vi) who is or has been, within the past three years, an officer or director of a competitor, as defined in Section 8 of the Clayton Antitrust Act of 1914; (vii) whose then-current or within the preceding ten years’ business or personal interests place such Proxy Access Stockholder Nominee in a conflict of interest with the Corporation or any of its subsidiaries that would cause such Proxy Access Stockholder Nominee to violate any fiduciary duties of directors established pursuant to the Delaware General Corporation Law, including but not limited to, the duty of loyalty and duty of care, as determined by the Board of Directors; (viii) who is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses) or has been convicted in such a criminal proceeding within the past ten years; (ix) if such Proxy Access Stockholder Nominee or the applicable Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) shall have provided information to the Corporation in connection with such nomination that was untrue in any material respect or omitted to state a material fact necessary in order to make any statement made, in light of the circumstances under which it was made, not misleading, as determined by the Board of Directors or any committee thereof; (x) the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) and the Proxy Access Stockholder Nominee do not appear at the applicable annual meeting of stockholders to present the Proxy Access Stockholder Nominee for election; (xi) the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) or applicable Proxy Access Stockholder Nominee otherwise breaches or fails to comply with or the Board of Directors determines it has breached its representations or obligations pursuant to these Bylaws, including, without limitation, this Section 2.8; (xii) the Eligible Stockholder ceases to be an Eligible Stockholder for any reason, including but not limited to not owning the Required Shares through the date of the applicable annual meeting; or (xiii) upon a determination of by the Board of Directors or any committee thereof that (A) the information provided pursuant to this Section 2.8 to the Corporation by such individual or by the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) who nominated such individual was untrue in any material respect or omitted to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading or (B) such individual, or the Eligible Stockholder (or any member of any group of stockholders that together is such Eligible Stockholder) who nominated such individual, shall have breached or failed to comply with its agreements, representations undertakings or obligations pursuant to these Bylaws, including, without limitation, this Section 2.8. For the purpose of this paragraph, clauses (iii) through (xiii) will result in the exclusion from the proxy materials pursuant to this Section 2.8 of the specific Proxy Access Stockholder Nominee to whom the ineligibility applies, or, if the proxy statement already has been filed, the ineligibility of the Proxy Access Stockholder Nominee; however, clauses (i) and (ii) will result in the exclusion from the proxy materials pursuant to this Section 2.8 of all Proxy Access Stockholder Nominees from the applicable annual meeting of Stockholders, or, if the proxy statement already has been filed, the ineligibility of all Proxy Access Stockholder Nominees.

This Section 2.8 shall be the exclusive method for stockholders to include nominees for director election in the Corporation’s proxy materials (other than business properly brought under and in compliance with Rule 14a-8 of the Exchange Act or any successor provision).

Section 2.9.Voting. Unless otherwise provided in a resolution or resolutions providing for any class or series of Preferred Stock pursuant to Article IV of the Certificate of Incorporation or by the Delaware General Corporation Law, each stockholder shall be entitled to one vote, in person or by proxy, for each share held of record by such stockholder who is entitled to vote generally in the election of directors. Each stockholder voting by proxy shall grant such authority in writing, by electronic or telephonic transmission or communication, or by any such other means permitted by the Delaware General Corporation Law. All questions, including elections for the Board of Directors, shall be decided by a majority of the votes cast, except as otherwise required by the Delaware General Corporation Law or as provided for in the Certificate of Incorporation or these Bylaws. Abstentions shall not be considered to be votes cast. For purposes of this Bylaw, a majority of votes cast shall mean that the number of shares voted “for” a director’s election exceeds 50% of the number of votes cast with respect to that director’s election or, in

the case where the number of nominees exceeds the number of directors to be elected, cast with respect to election of directors generally. Votes cast shall include votes to withhold authority in each case and exclude abstentions with respect to that director’s election, or, in the case where the number of nominees exceeds the number of directors to be elected, abstentions with respect to election of directors generally.

If a nominee for director who is an incumbent director is not elected and no successor has been elected at such meeting, the director shall promptly tender his or her resignation to the Board of Directors. The Nominating and Corporate Governance Committee of the Board of Directors shall make a recommendation to the Board of Directors as to whether to accept or reject the tendered resignation, or whether other action should be taken. The Board of Directors shall act on the tendered resignation, taking into account the Nominating and Corporate Governance Committee’s recommendation, and publicly disclose (by a press release, a filing with the Securities and Exchange Commission, or other broadly disseminated means of communication) its decision regarding the tendered resignation and the rationale for the decision within 90 days from the date of the certification of the election results. The Nominating and Corporate Governance Committee in making its recommendation, and the Board of Directors in making its decision, may each consider any factors or other information that it considers appropriate and relevant. The director who tenders his or her resignation will not participate in the recommendation of the Nominating and Corporate Governance Committee or the decision of the Board of Directors with respect to his or her resignation. If such incumbent director’s resignation is not accepted by the Board of Directors, such director shall continue to serve until the next annual meeting of stockholders at which such director’s term expires and until his or her successor is duly elected, or his or her earlier resignation and removal. If a director’s resignation is accepted by the Board of Directors pursuant to this Bylaw, or if a nominee for director is not elected and the nominee is not an incumbent director, then the Board of Directors, in its sole discretion, may fill any resulting vacancy or may decrease the size of the Board of Directors pursuant to the Delaware General Corporation Law and the Certificate of Incorporation and these Bylaws of the CompanyCorporation.

Section 2.10.Inspectors. The Board of Directors by resolution shall, in advance of any meeting of stockholders, appoint one or more inspectors, which inspector or inspectors may include individuals who serve the Corporation in other capacities, including, without limitation, as officers, employees, agents or representatives of the Corporation, to act at the meeting and make a written report thereof. One or more persons may be designated by the Board of Directors as alternate inspectors to replace any inspector who fails to act. If no inspector or alternate is able to act at a meeting of stockholders, the chairman of the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before discharging his or her duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of his or her ability. The inspectors shall have the duties prescribed by the Delaware General Corporation Law.

SECTION III

Board of Directors

Section 3.1.Number and Qualifications. The business and affairs of the Corporation shall be managed by or under the direction of its Board of Directors. The number of directors constituting the Board of Directors shall be as authorized from time to time exclusively by a vote of a majority of the members of the Board of Directors then in office. A person who is not serving as a director shall not be eligible for nomination, appointment, or election if such person has or will have reached age 75 on the date of his or her appointment or election, and any director reaching the age of 75 during any term of office shall continue to be qualified to serve as a director only until the next annual meeting of stockholders following his or her 75th birthday.

Section 3.2.Resignation. A director may resign at any time by giving notice, in writing, by electronic transmission or by any other means permitted by the Delaware General Corporation Law, to the Chairman of the Board or to the Secretary. Unless otherwise stated in such notice of resignation, the acceptance thereof shall not be necessary to make it effective; and such resignation shall take effect at the time specified therein or, in the absence of such specification, it shall take effect upon the receipt thereof.

Section 3.3.Regular Meetings. Regular meetings of the Board of Directors may be held without further notice at such time as shall from time to time be determined by the Board of Directors. Unless otherwise determined by the Board of Directors, the locations of the regular meetings of the Board of Directors shall be in Kingsport,

Tennessee. A meeting of the Board of Directors for the election of officers and the transaction of such other business as may come before it may be held without notice immediately following the annual meeting of stockholders.

Section 3.4.Special Meetings. Special meetings of the full Board of Directors may be called by the Chairman of the Board,orthe Lead Director, or the Vice Chairman. Special meetings of the non-employee, independent directors may be called by the Lead Director. Special meetings of the Board of Directors or of the non-employee, independent directors also may be called at the request in writing of one-third of the members of the Board of Directors then in office.

Section 3.5.Notice of Special Meetings. Notice of the date, time and place of each special meeting shall be mailed by regular mail to each director at his designated address at least six days before the meeting; or sent by overnight courier to each director at his designated address at least two days before the meeting (with delivery scheduled to occur no later than the day before the meeting); or given orally by telephone or other means, or by telegraph or telecopy, or by any other means comparable to any of the foregoing(including email), to each director, as applicable, at his designated address atleast 24twenty-four (24)hours before the meeting(or fewer than twenty-four (24) hours if the Chairman of the Board or the Lead Director determines that it is necessary or advisable for the Board of Directors to hold a special meeting sooner); provided, however, that if less than five days’ notice is provided and one third of the members of the Board of Directors then in office, or one-third of the number of non-employee, independent directors (in the case of a meeting of such directors) object in writing prior to or at the commencement of the meeting, such meeting shall be postponed until five days after such notice was given pursuant to this sentence (or such shorter period to which a majority of those who objected in writing agree), provided that notice of such postponed meeting shall be given in accordance with this Section 3.5. The notice of the special meeting shall state the general purpose of the meeting, with no other routine business conducted at the special meeting without such matter being stated in the notice.

Section 3.6.Place of Meetings. The Board of Directors may hold their meetings and have an office or offices inside or outside of the State of Delaware.

Section 3.7.Telephonic Meeting and Participation. Any or all of the directors may participate in a meeting of the Board of Directors or any committee thereof by conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation shall constitute presence in person at the meeting.

Section 3.8.Action by Directors Without a Meeting. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the full Board of Directors, the non-employee, independent directors, or of any committee thereof, may be taken without a meeting if all members of the Board, the non-employee, independent directors, or of such committee, as the case may be, consent thereto in writing, by electronic transmission, or by any other means permitted by the Delaware General Corporation Law, and the writing or writings or, if the consent action is taken by electronic transmission, paper reproductions of such electronic transmissions, are filed with the minutes of proceedings of the Board or committee.

Section 3.9.Quorum and Adjournment. A majority of the directors then holding office, or a majority of non-employee, independent directors then in office, for purposes of a meeting of such directors, shall constitute a quorum. The vote of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors, or of the non-employee, independent directors, as the case may be. Whether or not a quorum is present to conduct a meeting, any meeting of the Board of Directors, or of the non-employee, independent directors, as the case may be (including an adjourned meeting) may be adjourned by a majority of the directors present, to reconvene at a specific time and place. It shall not be necessary to give to the directors present at the adjourned meeting notice of the reconvened meeting or of the business to be transacted, other than by announcement at the meeting that was adjourned; provided, however, notice of such reconvened meeting, stating the date, time, and place of the reconvened meeting, shall be given to the directors not present at the adjourned meeting in accordance with the requirements of Section 3.5 hereof.

Section 3.10.Organization. The Chairman of the Board, or, in the absence of the Chairman of the Board, the Lead Directoror the Vice Chairman, or in the absence of the Lead Directoror Vice Chairman, a member of the

Board selected by the members present, shall preside at meetings of the Board. The Secretary of the Corporation shall act as secretary, but in the absence of the Secretary, the presiding officer may appoint a secretary.

Section 3.11.Compensation of Directors. Directors shall receive such compensation for their services as the Board of Directors may determine. Any director may serve the Corporation in any other capacity and receive compensation therefor.

Section 3.12.Presumption of Assent. A director of the Corporation who is present at a meeting of the Board of Directors when a vote on any matter is taken is deemed to have assented to the action taken unless he votes against or abstains from the action taken, or unless at the beginning of the meeting or promptly upon arrival the director objects to the holding of the meeting or transacting specified business at the meeting. Any such dissenting votes, abstentions or objections shall be entered in the minutes of the meeting.

SECTION IV

Chairman, Lead Director, and Committees of the Board of Directors

Section 4.1.Chairman. The Board of Directors shall, by resolution passed by a majority of the members of the Board of Directors, designate a member of the Board of Directors to serve as Chairman. The Chairman of the Board may also be the Chief Executive Officer, or other officer of the Corporation, and shall have such powers and perform such duties as may be provided for herein, and as may be incident to the office and as may be assigned by the Board of Directors.

Section 4.2.Lead Director. If the Chairman is the Chief Executive Officer or other officer or employee of the Corporation or is not an independent director(as determined by the Board of Directors)director, the non-employee, independent directors, by resolution passed by a majority of the non-employee, independent members of the Board of Directors, shall designate a non-employee, independent member of the Board of Directors to serve as Lead Director. The Lead Director shall have such powers and perform such duties as may be provided for herein and as may be incident to the office and as may be assigned by the non-employee, independent members of Board of Directors.

Section 4.3.Committees. The Board of Directors shall, by resolutions passed by a majority of the members of the Board of Directors, designate members of the Board of Directors to constitute committees which shall in each case consist of such number of directors, and shall have and may execute such powers as may be determined and specified in the respective resolutions appointing them. Any such committee may fix its rules of procedure, determine its manner of acting and the time and place, whether within or without the State of Delaware, of its meetings and specify what notice thereof, if any, shall be given, unless the Board of Directors shall otherwise by resolution provide. Unless otherwise provided by the Board of Directors or such committee, the quorum, voting and other procedures shall be the same as those applicable to actions taken by the Board of Directors. A majority of the members of the Board of Directors then in office shall have the power to change the membership of any such committee at any time, to fill vacancies therein and to discharge any such committee or to remove any member thereof, either with or without cause, at any time.

SECTION V

Officers

Section 5.1.Designation. The officers of the Corporation shall be a Chief Executive Officer, a Chief Financial Officer, a Treasurer, a Chief Accounting Officer (or, if there is no Chief Accounting Officer, a Controller), and a Secretary, and such other officers as the Board of Directors may elect or appoint, or provide for the appointment of, as may from time to time appear necessary or advisable in the conduct of the business and affairs of the Corporation. Any number of offices may be held by the same persons.

Section 5.2.Election Term. At its first meeting after each annual meeting of stockholders, the Board of Directors shall elect the officers or provide for the appointment thereof. Subject to Section 5.3 and Section 5.4 hereof, the term of each officer elected by the Board of Directors shall be until the first meeting of the Board of Directors following the next annual meeting of stockholders and until such officer’s successor is chosen and qualified.

Section 5.3.Resignation. Any officer may resign at any time by giving written notice to the Secretary. Unless otherwise stated in such notice of resignation, the acceptance thereof shall not be necessary to make it effective; and such resignation shall take effect at the time specified therein or, in the absence of such specification, it shall take effect upon the receipt thereof.

Section 5.4.Removal. Any officer may be removed at any time with or without cause by affirmative vote of a majority of the members of the Board of Directors then in office. Any officer appointed by another officer may be removed with or without cause by such officer or the Chief Executive Officer.

Section 5.5.Vacancies. A vacancy in any office may be filled for the unexpired portion of the term by the Board of Directors or, in the case of offices held by officers who may be appointed by other officers, by any officer authorized to appoint such officer.

Section 5.6.Chief Executive Officer. The Chief Executive Officer shall be responsible for carrying out the policies adopted by the Board of Directors.

Section 5.7.Chief Financial Officer. The Chief Financial Officer shall act in an executive financial capacity, and assist the Chief Executive Officer in the general supervision of the Corporation’s financial policies and affairs, and shall perform all acts incident to the position of Chief Financial Officer, subject to the control of the Board of Directors.

Section 5.8.Treasurer. The Treasurer shall have charge of all funds of the Corporation and shall perform all acts incident to the position of Treasurer, subject to the control of the Board of Directors.

Section 5.9.Chief Accounting Officer and Controller. The Chief Accounting Officer (or the Controller, if there is no Chief Accounting Officer) shall serve as principal accounting officer of the Corporation, having the custody and operation of the accounting books and records of the Corporation (with the Controller, if there is a separate Controller), and shall perform all acts incident to the position of Controller, subject to the control of the Board of Directors.

Section 5.10.Secretary. The Secretary shall keep the minutes, and give notices, of all meetings of stockholders and directors and of such committees as directed by the Board of Directors. The Secretary shall have charge of such books and papers as the Board of Directors may require. The Secretary (or any Assistant Secretary) is authorized to certify copies of extracts from minutes and of documents in the Secretary’s charge and anyone may rely on such certified copies to the same effect as if such copies were originals and may rely upon any statement of fact concerning the Corporation certified by the Secretary (or any Assistant Secretary). The Secretary shall perform all acts incident to the office of Secretary, subject to the control of the Board of Directors.

Section 5.11.Compensation of Officers. The officers of the Corporation shall receive such compensation for their services as the Board of Directors or the appropriate committee thereof may determine. The Board of Directors may delegate its authority to determine compensation (other than that of the Chief Executive Officer) to designated officers of the Corporation.

Section 5.12.Execution of Instruments. Checks, notes, drafts, other commercial instruments, assignments, guarantees of signatures and contracts (except as otherwise provided herein or by law) shall be executed by the Chief Executive Officer or other officers or employees or agents, in any such case as the Board of Directors may direct or authorize.

Section 5.13.Mechanical Endorsements. The Chief Executive Officer, the Secretary, or other authorized officers may authorize any endorsement on behalf of the Corporation to be made by such mechanical means or stamps as any of such officers may deem appropriate.

SECTION VI

Indemnification

Section 6.1.Indemnification Provisions in Certificate of Incorporation. The provisions of this Section VI are intended to supplement Article VII of the Certificate of Incorporation pursuant to Sections 7.2 and 7.3 thereof. To the extent that this Section VI contains any provisions inconsistent with said Article VII, the provisions of the Certificate of Incorporation shall govern. Terms defined in such Article VII shall have the same meaning in this Section VI.

Section 6.2.Indemnification of Employees. The Corporation shall indemnify and advance expenses to its employees to the same extent as to its directors and officers, as set forth in the Certificate of Incorporation and in this Section VI of the Bylaws of the Corporation.

Section 6.3.Undertakings for Advances of Expenses. If and to the extent the Delaware General Corporation Law requires, an advancement by the Corporation of expenses incurred by an indemnitee pursuant to clause (iii) of the last sentence of Section 7.1 of the Certificate of Incorporation (hereinafter an “advancement of expenses”) shall be made only upon delivery to the Corporation of an undertaking (hereinafter an “undertaking”), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (hereinafter a “final adjudication”) that such indemnitee is not entitled to be indemnified for such expenses under Article VII of the Certificate of Incorporation or otherwise.

Section 6.4.Claims for Indemnification. If a claim for indemnification under Section 7.1 of the Certificate of Incorporation is not paid in full by the Corporation within 60 days after it has been received in writing by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be 20 days, the indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the indemnitee shall be entitled to be paid also the expense of prosecuting or defending such suit. In any suit brought by the indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the indemnitee to enforce a right to an advancement of expenses) it shall be a defense that, and in any suit by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking the Corporation shall be entitled to recover such expenses only upon a final adjudication that, the indemnitee has not met the applicable standard of conduct set forth in Section 145 of the Delaware General Corporation Law (or any successor provision or provisions). Neither the failure of the Corporation (including the Board of Directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such suit that indemnification of the indemnitee is proper in the circumstances because the indemnitee has met the applicable standard of conduct set forth in Section 145 of the Delaware General Corporation Law (or any successor provision or provisions), nor an actual determination by the Corporation (including the Board of Directors, independent legal counsel, or its stockholders) that the indemnitee has not met such applicable standard of conduct, shall create a presumption that the indemnitee has not met the applicable standard of conduct or, in the case of such a suit brought by the indemnitee, be a defense to such suit. In any suit brought by the indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the indemnitee is not entitled to be indemnified, or to have or retain such advancement of expenses, under Article VII of the Certificate of Incorporation or this Section VI or otherwise, shall be on the Corporation.

Section 6.5.Insurance. The Corporation may maintain insurance, at its expense, to protect itself and any director, trustee, officer, employee or agent of the Corporation or another enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the Delaware General Corporation Law.

Section 6.6.Severability. In the event that any of the provisions of this Section VI (including any provision within a single section, paragraph or sentence) is held by a court of competent jurisdiction to be invalid, void or otherwise unenforceable, the remaining provisions are severable and shall remain enforceable to the full extent permitted by law.

SECTION VII

Miscellaneous

Section 7.1.Seal. The Corporation shall have a suitable seal, containing the name of the Corporation. The Secretary shall be in charge of the seal and may authorize one or more duplicate seals to be kept and used by any other officer or person.

Section 7.2.Waiver of Notice. Whenever any notice is required to be given, a waiver thereof in writing, signed by the person or persons entitled to the notice, whether before or after the time stated therein shall be deemed equivalent thereto. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened.

Section 7.3.Voting of Stock Owned by the Corporation. Powers of attorney, proxies, waivers of notice of meeting, consents and other instruments relating to securities owned by the Corporation may be executed in the name of and on behalf of the Corporation by the Chairman of the Board, the Chief Executive Officer, the Vice Chairman, any Vice President or such officers or employees or agents as the Board of Directors or any of such designated officers may direct. Any such officer may, in the name of and on behalf of the Corporation, take all such action as any such officer may deem advisable to vote in person or by proxy at any meeting of security holders of any corporation in which the Corporation may own securities and at any such meeting shall possess and may exercise any and all rights and powers incident to the ownership of such securities and which, as the owner thereof, the Corporation might have exercised and possessed if present. The Board of Directors may from time to time confer like powers upon any other person or persons.

Section 7.4.General Severability. Whenever possible, each provision or portion of any provision of these Bylaws will be interpreted in such manner as to be effective and valid under applicable law, but if any provision or portion of any provision of these Bylaws (including any provision within a single section, paragraph or sentence) is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such provision or portion of any provision shall be severable and the invalidity, illegality or unenforceability will not affect any other provision or portion of any provision in such jurisdiction, and these Bylaws will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had never been contained herein.

SECTION VIII

Amendment of Bylaws

Section 8.1.Power to Amend. Except as otherwise provided by law or by the certificate of incorporation or these bylawsBylaws, these bylawsBylawsor any of them may be amended in any respect or repealed at any time, either (i) at any meeting of stockholders, subject to these bylawsBylaws, provided that any amendment or supplement proposed to be acted upon at any such meeting has been described in reasonable detail in the notice of such meeting, or (ii) at any meeting of the Board of Directors, provided in all events that no amendment to any by-law that conflicts or varies with, or frustrates the purposes or effect of, any provision of the certificate of incorporation or other provisions of these bylawsBylawsmay be adopted (including, without limitation, any bylaw the purpose or effect of which is to require approvals of matters by supermajority vote of the Board of Directors or a committee) without amendment of such provision of the certificate of incorporation or other provision of the bylawsBylawsin accordance with applicable law and, to the extent otherwise applicable, these bylawsBylaws.

Section 8.2.Approval of Amendments. Notwithstanding the foregoing and anything contained in these bylawsBylawsto the contrary, these bylawsBylawsmay not be amended, supplemented, or repealed by the stockholders, and no provision inconsistent in intent, operation, or effect therewith may be adopted by the stockholders, without the affirmative vote of the holders of a majority of the votes cast with respect to adoption, supplementing, or repeal of these bylawsBylaws.

SECTION IX

Adjudication of Disputes

Section 9.1.Exclusive Forum. To the fullest extent permitted by law, and unless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for: (1) any derivative action or proceeding brought in the name or right of the Corporation or on its behalf, (2) any action asserting a claim for breach of a fiduciary duty owed by any director, officer, employee, stockholder or other agent of the Corporation to the Corporation or the Corporation’s stockholders, (3) any action arising or asserting a claim arising pursuant to any provision of the Delaware General Corporation Law or any provision of the Certificate of Incorporation or these Bylaws or as to which the Delaware General Corporation Law confers jurisdiction on the Court of Chancery of the State of Delaware or (4) any action asserting a claim governed by the internal affairs doctrine, including, without limitation, any action to interpret, apply, enforce or determine the validity of the Certificate of Incorporation or these Bylaws. Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of the Corporation shall be deemed to have notice of and consented to the provisions of this Section IX.

Amended February 18, 2016August 3,2017

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Document and Entity Information - USD ($)	6 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	EASTMAN CHEMICAL CO
Entity Central Index Key	0000915389
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float		$ 9,903,245,691
Entity Common Stock, Shares Outstanding	144,879,098
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q2
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2017

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UNAUDITED CONSOLIDATED STATEMENTS OF EARNINGS, COMPREHENSIVE INCOME AND RETAINED EARNINGS - USD ($) $ in Millions		3 Months Ended				6 Months Ended
		Jun. 30, 2017		Jun. 30, 2016		Jun. 30, 2017		Jun. 30, 2016
Income Statement [Abstract]
Sales		$ 2,419		$ 2,297		$ 4,722		$ 4,533
Cost of sales		1,768		1,692		3,446		3,294
Gross profit		651		605		1,276		1,239
Selling, general and administrative expenses		176		174		350		357
Research and development expenses		55		55		109		109
Asset impairments and restructuring gains, net		0		0		0		(2)
Operating earnings		420		376		817		775
Net interest expense		61		63		121		127
Early debt extinguishment costs		0		9		0		9
Other (income) charges, net		0		(20)		(4)		(8)
Earnings before income taxes		359		324		700		647
Provision for income taxes		65		67		127		139
Net earnings		294		257		573		508
Less: Net earnings attributable to noncontrolling interest		2		2		3		2
Net earnings attributable to Eastman		$ 292		$ 255		$ 570		$ 506
Basic earnings per share attributable to Eastman
Basic earnings per share attributable to Eastman		$ 2.01		$ 1.73		$ 3.91		$ 3.43
Diluted earnings per share attributable to Eastman
Diluted earnings per share attributable to Eastman		$ 2.00		$ 1.71		$ 3.89		$ 3.40
Comprehensive Income
Net earnings including noncontrolling interest		$ 294		$ 257		$ 573		$ 508
Other comprehensive income (loss), net of tax:
Change in cumulative translation adjustment		36		(70)		43		36
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits included in net periodic costs	[1]	(6)		(7)		(13)		(14)
Derivatives and hedging:
Unrealized gain (loss) during period	[2]	(18)		38		(39)		20
Reclassification adjustment for losses included in net income, net	[2]	8		33		4		37
Total other comprehensive income (loss), net of tax		20	[2]	(6)	[2]	(5)		79
Comprehensive income including noncontrolling interest		314		251		568		587
Less: Net earnings attributable to noncontrolling interest		2		2		3		2
Comprehensive income attributable to Eastman		312		249		565		585
Retained Earnings
Retained earnings at beginning of period		5,925		5,330		5,721		5,146
Net earnings attributable to Eastman		292		255		570		506
Cash dividends declared		(75)		(68)		(149)	[3]	(135)
Retained earnings at end of period		$ 6,142		$ 5,517		$ 6,142		$ 5,517

[1] Included in the calculation of net periodic benefit costs for pension and other postretirement benefit plans. See Note 7, "Retirement Plans".

[2] For additional information regarding the impact of reclassifications into earnings, see Note 6, "Derivative and Non-Derivative Financial Instruments".

[3] Cash dividends declared includes cash dividends paid and dividends declared, but unpaid.

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UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION - USD ($) $ in Millions		Jun. 30, 2017	Dec. 31, 2016
Current assets
Cash and cash equivalents		$ 222	$ 181
Trade receivables, net of allowance for doubtful accounts		1,018	812
Miscellaneous receivables		419	399
Inventories		1,540	1,404
Other current assets		63	70
Total current assets		3,262	2,866
Properties
Properties and equipment at cost		11,966	11,699
Less: Accumulated depreciation		6,563	6,423
Net properties		5,403	5,276
Goodwill		4,507	4,461
Intangible assets, net of accumulated amortization		2,433	2,469
Other noncurrent assets		359	385
Total assets	[1]	15,964	15,457
Current liabilities
Payables and other current liabilities		1,384	1,512
Borrowings due within one year		212	283
Total current liabilities		1,596	1,795
Long-term borrowings		6,669	6,311
Deferred income tax liabilities		1,286	1,206
Post-employment obligations		1,004	1,018
Other long-term liabilities		519	519
Total liabilities		11,074	10,849
Stockholders' equity
Common stock ($0.01 par value – 350,000,000 shares authorized; shares issued – 218,274,450 and 217,707,600 for 2017 and 2016, respectively)		2	2
Additional paid-in capital		1,954	1,915
Retained earnings		6,142	5,721
Accumulated other comprehensive income (loss)		(286)	(281)
Stockholder's Equity before Treasury Stock		7,812	7,357
Less: Treasury stock at cost (73,446,150 shares for 2017 and 71,269,474 shares for 2016)		3,000	2,825
Total Eastman stockholders' equity		4,812	4,532
Noncontrolling interest		78	76
Total equity		4,890	4,608
Total liabilities and stockholders' equity		$ 15,964	$ 15,457

[1] Segment assets include accounts receivable, inventory, fixed assets, goodwill, and intangible assets. Segment asset balances for shared fixed assets within the CI and Fibers segments as of December 31, 2016 have been reclassified to conform to current period allocation methodology.

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UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Parenthetical) - $ / shares	Jun. 30, 2017	Dec. 31, 2016
Stockholders' equity
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	350,000,000	350,000,000
Common stock, shares issued (in shares)	218,274,450	217,707,600
Treasury stock at cost (in shares)	73,446,150	71,269,474

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UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Operating activities
Net earnings	$ 573	$ 508
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	292	291
Early debt extinguishment costs	0	9
Gain on sale of equity investment	0	(17)
Provision for deferred income taxes	36	47
Changes in operating assets and liabilities, net of effect of acquisitions and divestitures:
(Increase) decrease in trade receivables	(166)	(151)
(Increase) decrease in inventories	(108)	41
Increase (decrease) in trade payables	(28)	(76)
Pension and other postretirement contributions (in excess of) less than expenses	(56)	(51)
Variable compensation (in excess of) less than expenses	(34)	(67)
Other items, net	(26)	11
Net cash provided by operating activities	483	545
Investing activities
Additions to properties and equipment	(279)	(234)
Proceeds from sale of assets	1	41
Acquisitions, net of cash acquired	(4)	(22)
Other items, net	(1)	3
Net cash used in investing activities	(283)	(212)
Financing activities
Net increase (decrease) in commercial paper and other borrowings	(95)	(208)
Proceeds from borrowings	500	807
Repayment of borrowings	(250)	(807)
Dividends paid to stockholders	(149)	(136)
Treasury stock purchases	(175)	(45)
Dividends paid to noncontrolling interest	(1)	(4)
Proceeds from stock option exercises and other items, net	12	8
Net cash used in financing activities	(158)	(385)
Effect of exchange rate changes on cash and cash equivalents	(1)	(1)
Net change in cash and cash equivalents	41	(53)
Cash and cash equivalents at beginning of period	181	293
Cash and cash equivalents at end of period	$ 222	$ 240

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BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2017

Accounting Policies [Abstract]

BASIS OF PRESENTATION

BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared by Eastman Chemical Company ("Eastman" or the "Company") in accordance and consistent with the accounting policies stated in the Company's 2016 Annual Report on Form 10-K and should be read in conjunction with the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K. The December 31, 2016 financial position data included herein was derived from the audited consolidated financial statements included in the 2016 Annual Report on Form 10-K but does not include all disclosures required by accounting principles generally accepted in the United States ("GAAP").

In the opinion of management, the unaudited consolidated financial statements include all normal recurring adjustments necessary for fair presentation of the interim financial information in conformity with GAAP. These statements contain some amounts that are based upon management estimates and judgments. Future actual results could differ from such current estimates. The unaudited consolidated financial statements include assets, liabilities, sales revenue, and expenses of all majority-owned subsidiaries and joint ventures in which a controlling interest is maintained. Eastman accounts for other joint ventures and investments where it exercises significant influence on the equity basis. Intercompany transactions and balances are eliminated in consolidation. Certain prior period data has been reclassified in the consolidated financial statements and accompanying footnotes to conform to current period presentation.

Basis of Accounting, Policy [Policy Text Block]

The accompanying unaudited consolidated financial statements have been prepared by Eastman Chemical Company ("Eastman" or the "Company") in accordance and consistent with the accounting policies stated in the Company's 2016 Annual Report on Form 10-K and should be read in conjunction with the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K. The December 31, 2016 financial position data included herein was derived from the audited consolidated financial statements included in the 2016 Annual Report on Form 10-K but does not include all disclosures required by accounting principles generally accepted in the United States ("GAAP").

In the opinion of management, the unaudited consolidated financial statements include all normal recurring adjustments necessary for fair presentation of the interim financial information in conformity with GAAP. These statements contain some amounts that are based upon management estimates and judgments. Future actual results could differ from such current estimates. The unaudited consolidated financial statements include assets, liabilities, sales revenue, and expenses of all majority-owned subsidiaries and joint ventures in which a controlling interest is maintained. Eastman accounts for other joint ventures and investments where it exercises significant influence on the equity basis. Intercompany transactions and balances are eliminated in consolidation. Certain prior period data has been reclassified in the consolidated financial statements and accompanying footnotes to conform to current period presentation.

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INVENTORIES

6 Months Ended

Jun. 30, 2017

Inventory Disclosure [Abstract]

INVENTORIES

INVENTORIES

	June 30,		December 31,
(Dollars in millions)	2017		2016
Finished goods	$	1,103	$	997
Work in process	220		198
Raw materials and supplies	478		473
Total inventories at FIFO or average cost	1,801		1,668
Less: LIFO reserve	261		264
Total inventories	$	1,540	$	1,404

Inventories valued on the last-in, first-out ("LIFO") method were approximately 60 percent of total inventories at both June 30, 2017 and December 31, 2016.

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PAYABLES AND OTHER CURRENT LIABILITIES

6 Months Ended

Jun. 30, 2017

Payables and Accruals [Abstract]

PAYABLES AND OTHER CURRENT LIABILITIES

PAYABLES AND OTHER CURRENT LIABILITIES

	June 30,		December 31,
(Dollars in millions)	2017		2016
Trade creditors	$	675	$	704
Accrued payrolls, vacation, and variable-incentive compensation	125		196
Accrued taxes	90		106
Post-employment obligations	84		110
Derivative hedging liability	82		72
Other	328		324
Total payables and other current liabilities	$	1,384	$	1,512

The "Other" above consists primarily of accruals for dividends payable, interest payable, the current portion of environmental liabilities, and miscellaneous accruals.

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PROVISION FOR INCOME TAXES

6 Months Ended

Jun. 30, 2017

Income Tax Disclosure [Abstract]

PROVISION FOR INCOME TAXES

PROVISION FOR INCOME TAXES

	Second Quarter								First Six Months
(Dollars in millions)	2017				2016				2017				2016
	$		%		$		%		$		%		$		%
Provision for income taxes and tax rate	$	65	18	%	$	67	21	%	$	127	18	%	$	139	22	%

The second quarter and first six months2017 effective tax rates include a $22 million tax benefit to reflect finalization of prior years' income tax returns. The first six months2017 effective tax rate also reflects a $22 million tax benefit due to planned amendments to prior years' income tax returns. The second quarter and first six months 2016 effective tax rates include a $16 million one-time benefit for the restoration of tax basis for which depreciation deductions were previously limited. The first six months 2016 effective tax rate also reflects a $9 million tax benefit primarily due to adjustments to the tax provision to reflect the finalization of 2014 foreign income tax returns.

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BORROWINGS

6 Months Ended

Jun. 30, 2017

Debt Disclosure [Abstract]

BORROWINGS

BORROWINGS

	June 30,		December 31,
(Dollars in millions)	2017		2016
Borrowings consisted of:
5.5% notes due November 2019	$	250	$	249
2.7% notes due January 2020	796		796
4.5% notes due January 2021	184		184
3.6% notes due August 2022	739		741
1.50% notes due May 2023 (1)	852		786
7 1/4% debentures due January 2024	197		197
7 5/8% debentures due June 2024	43		43
3.8% notes due March 2025	690		689
1.875% notes due November 2026(1)	563		519
7.60% debentures due February 2027	195		195
4.8% notes due September 2042	493		493
4.65% notes due October 2044	871		870
Credit facilities borrowings	799		549
Commercial paper borrowings	200		280
Capital leases and other	9		3
Total borrowings	6,881		6,594
Borrowings due within one year	212		283
Long-term borrowings	$	6,669	$	6,311

⁽¹⁾  The carrying value of the euro-denominated 1.50% notes due May 2023 and 1.875% notes due November 2026 will fluctuate with changes in the euro exchange rate. The carrying value of these euro-denominated borrowings have been designated as non-derivative net investment hedges of a portion of the Company's net investments in euro functional-currency denominated subsidiaries to offset foreign currency fluctuations. During the six months endedJune 30, 2017 and 2016, pre-tax losses of $109 million and gains of $3 million, respectively, were recognized in "Other comprehensive income (loss)" ("OCI") for revaluation of these notes.

Credit Facility and Commercial Paper Borrowings

In December 2014, Eastman borrowed $1 billion under a five-year term loan ("2019 Term Loan"). As of June 30, 2017 and December 31, 2016, the 2019 Term Loan agreement balance outstanding was $250 million with an interest rate of 2.48 percent and 2.02 percent, respectively. In December 2016, the Company borrowed $300 million under a second five-year term loan ("2021 Term Loan"). As of June 30, 2017 and December 31, 2016, the 2021 Term Loan agreement balance outstanding was $299 million with an interest rate of 2.48 percent and 1.95 percent, respectively. Borrowings under the 2019 Term Loan and 2021 Term Loan agreements are subject to interest at varying spreads above quoted market rates.

The Company has access to a $1.25 billion revolving credit agreement (the "Credit Facility") that expires October 2021. Borrowings under the Credit Facility are subject to interest at varying spreads above quoted market rates and a commitment fee is paid on the total unused commitment. The Credit Facility provides liquidity support for commercial paper borrowings and general corporate purposes. Commercial paper borrowings are classified as short-term. At June 30, 2017 and December 31, 2016, the Company had no outstanding borrowings under the Credit Facility. At June 30, 2017, the Company's commercial paper borrowings were $200 million with a weighted average interest rate of 1.44 percent. At December 31, 2016, the Company's commercial paper borrowings were $280 million with a weighted average interest rate of 1.12 percent.

The Company has access to a $250 million accounts receivable securitization agreement (the "A/R Facility") that expires April 2019. Eastman Chemical Financial Corporation ("ECFC"), a subsidiary of the Company, has an agreement to sell interests in trade receivables under the A/R Facility to a third party purchaser. Third party creditors of ECFC have first priority claims on the assets of ECFC before those assets would be available to satisfy the Company's general obligations. Borrowings under the A/R Facility are subject to interest rates based on a spread over the lender's borrowing costs, and ECFC pays a fee to maintain availability of the A/R Facility. At December 31, 2016, the Company had no borrowings under the A/R Facility. At June 30, 2017, the Company's borrowings under the A/R Facility were $250 million supported by trade receivables with an interest rate of 1.98%.

The Credit and A/R Facilities and other borrowing arrangements contain customary covenants and events of default, some of which require the Company to maintain certain financial ratios that determine the amounts available and terms of borrowings. The Company was in compliance with all covenants at both June 30, 2017 and December 31, 2016.

Fair Value of Borrowings

The Company has classified its long-term borrowings at June 30, 2017 and December 31, 2016, under the fair value hierarchy as defined in the accounting policies in Note 1, "Significant Accounting Policies", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K. The fair value for fixed-rate debt securities is based on current market prices and is classified as Level 1. The fair value for the Company's other borrowings under the Term Loans and the A/R Facility equals the carrying value and is classified as Level 2. The Company had no borrowings classified as Level 3 as of June 30, 2017 and December 31, 2016.

			Fair Value Measurements at June 30, 2017
(Dollars in millions)	Recorded Amount June 30, 2017		Total Fair Value		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)
Long-term borrowings	$	6,669	$	7,069	$	6,273	$	796

			Fair Value Measurements at December 31, 2016
(Dollars in millions)	Recorded Amount December 31, 2016		Total Fair Value		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)
Long-term borrowings	$	6,311	$	6,586	$	6,036	$	550

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DERIVATIVE AND NON-DERIVATIVE FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVES

DERIVATIVE AND NON-DERIVATIVE FINANCIAL INSTRUMENTS

Overview of Hedging Programs

The Company is exposed to market risks, such as changes in foreign currency exchange rates, commodity prices, and interest rates. To mitigate these market risks and their effects on the cash flows of the underlying transactions and investments in foreign subsidiaries, the Company uses various derivative and non-derivative financial instruments, when appropriate, in accordance with the Company's hedging strategy and policies. Designation is performed on a specific exposure basis to support hedge accounting. The Company does not enter into derivative transactions for speculative purposes.  

For further information on hedging programs, see Note 10, "Derivative and Non-Derivative Financial Instruments", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K.

Cash Flow Hedges

Cash flow hedges are derivative instruments designated as and used to hedge the exposure to variability in expected future cash flows that are attributable to a particular risk. The derivative instruments that are designated and qualify as a cash flow hedge are reported on the balance sheet at fair value and the changes in fair value of these hedging instruments are offset in part or in whole by corresponding changes in the anticipated cash flows of the underlying exposures being hedged. The net of the change in the hedge instrument and item being hedged for qualifying cash flow hedges is reported as a component of "Accumulated other comprehensive income (loss)" ("AOCI") located in the Unaudited Consolidated Statements of Financial Position and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivatives representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings.

Fair Value Hedges

Fair value hedges are defined as derivative or non-derivative instruments designated as and used to hedge the exposure to changes in the fair value of an asset or a liability or an identified portion thereof that is attributable to a particular risk. The derivative instruments that are designated and qualify as fair value hedges are reported on the balance sheet at fair value and the changes in fair value of these hedging instruments are offset in part or in whole by corresponding changes in the anticipated cash flows of the underlying exposures being hedged. The net of the change in the hedge instrument and item being hedged for qualifying fair value hedges is reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivatives representing hedge ineffectiveness are recognized in current earnings.

In second quarter 2016, the Company entered into a fixed-to-floating interest rate swap on a portion of the 3.8% notes due March 2025 to manage the Company's mix of fixed and variable rate debt.

Net Investment Hedges

Net investment hedges are defined as derivative or non-derivative instruments designated as and used to hedge the foreign currency exposure of net investments in certain foreign operations. The net of the change in the hedge instrument and item being hedged for qualifying net investment hedges is reported as a component of "Change in cumulative translation adjustment" within AOCI located in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings. Gains and losses representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. The foreign currency-denominated borrowings designated as net investment hedges are included as part of "Long-term borrowings'" within the Unaudited Consolidated Statements of Financial Position.

The Company designated the euro-denominated 1.50% notes due May 2023 in the principal amounts of €200 million ($213 million) in fourth quarter 2016 and €550 million ($614 million) in second quarter 2016 and the euro-denominated 1.875% notes due November 2026 in the principal amount of €500 million ($534 million) in fourth quarter 2016 as non-derivative net investment hedges of a portion of the Company's net investments in euro functional currency-denominated subsidiaries to offset foreign currency fluctuations.

Summary of Financial Position and Financial Performance of Hedging Instruments

The following table shows the notional amounts outstanding atJune 30, 2017 and December 31, 2016associated with the Company's hedging programs.

Notional Outstanding		June 30, 2017	December 31, 2016
Derivatives designated as cash flow hedges:
Foreign Exchange Forward and Option Contracts (in millions)
	EUR/USD (in EUR)	€360	€378
	EUR/USD (in approximate USD equivalent)	$411	$398
	JPY/USD (in JPY)	¥900	¥1,800
	JPY/USD (in approximate USD equivalent)	$8	$15
Commodity Forward and Collar Contracts
	Feedstock (in million barrels)	10	11
	Energy (in million million british thermal units)	20	23
Derivatives designated as fair value hedges:
Fixed-for-floating interest rate swaps (in millions)		$75	$75
Non-derivatives designated as net investment hedges:
Foreign Currency Net Investment Hedges (in millions)
	EUR/USD (in EUR)	€1,239	€1,238

Fair Value Measurements

All the Company's derivative assets and liabilities are currently classified as Level 2 with fair values based on estimates using standard pricing models. These standard pricing models use inputs which are derived from or corroborated by observable market data such as interest rate yield curves and currency spot and forward rates. The fair value of commodity contracts is derived using forward curves supplied by an industry recognized and unrelated third party. In addition, on an ongoing basis, the Company tests a subset of its valuations against valuations received from the transaction's counterparty to validate the accuracy of its standard pricing models. Counterparties to these derivative contracts are highly rated financial institutions which the Company believes carry minimal risk of nonperformance. The Company diversifies its positions among such counterparties to reduce its exposure to counterparty risk and credit losses and monitors the creditworthiness of its counterparties on an on-going basis. The Company had no credit losses during second quarter and first six months2017 and 2016.

For additional fair value measurement information, see Note 1, "Significant Accounting Policies", and Note 10, "Derivative and Non-Derivative Financial Instruments", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K.

The following table shows the financial assets and liabilities valued on a gross basis as ofJune 30, 2017 and December 31, 2016. Additionally, the table below indicates where the derivatives are reported on the Unaudited Consolidated Statements of Financial Position. During the periods presented, there were no transfers between fair value hierarchy levels.

The Financial Position and Fair Value Measurements of Hedging Instruments on a Gross Basis
(Dollars in millions)
Derivative Type	Statements of Financial Position Classification	June 30, 2017 Level 2		December 31, 2016 Level 2
Derivatives designated as cash flow hedges:
Commodity contracts	Other current assets	$	1	$	5
Commodity contracts	Other noncurrent assets	—		2
Foreign exchange contracts	Other current assets	35		49
Foreign exchange contracts	Other noncurrent assets	16		47
Derivatives designated as fair value hedges:
Fixed-for-floating interest rate swap	Other current assets	1		1
Total Derivative Assets		$	53	$	104
Derivatives designated as cash flow hedges:
Commodity contracts	Payables and other current liabilities	$	75	$	62
Commodity contracts	Other long-term liabilities	58		69
Foreign exchange contracts	Payables and other current liabilities	1		—
Foreign exchange contracts	Other long-term liabilities	1		—
Derivatives designated as fair value hedges:
Fixed-for-floating interest rate swap	Long-term borrowings	3		4
Total Derivative Liabilities		$	138	$	135
Total Net Derivative Liabilities		$	85	$	31

In addition to the fair value associated with derivative instruments designated as cash flow hedges and fair value hedges noted in the table above, the Company had a carrying value of $1.4 billion and $1.3 billion associated with non-derivative instruments designated as foreign currency net investment hedges at June 30, 2017 and December 31, 2016, respectively. The designated foreign currency-denominated borrowings are included in the "Long-term borrowings" line item of the Unaudited Consolidated Statements of Financial Position.

All the Company's derivative contracts are subject to master netting arrangements, or similar agreements, which provide for the option to settle contracts on a net basis when they settle on the same day and in the same currency. In addition, these arrangements provide for a net settlement of all contracts with a given counterparty in the event that the arrangement is terminated due to the occurrence of default or a termination event. The Company has elected to present the derivative contracts on a gross basis in the Unaudited Consolidated Statements of Financial Position. If the Company presented the derivatives contracts on a net basis, there would be no material difference in asset and liability positions. The Company does not have any cash collateral due under such agreements.

The tables below present the effect of hedging instruments on OCI and the financial performance for second quarter and first six months2017 and 2016:

(Dollars in millions)	Change in amount of after tax gain/(loss) recognized in OCI on derivatives (effective portion)						Pre-tax amount of gain/(loss) reclassified from Accumulated OCI into income (effective portion)						Additional pre-tax gain/(loss) recognized in earnings (effective portion)
	Second Quarter						Second Quarter						Second Quarter
Hedging Relationships	2017			2016			2017			2016			2017		2016		Income Statement Classification
Derivatives in cash flow hedging relationships:
Commodity contracts	$	9		$	79		$	(20	)	$	(65	)	$	—	$	—	Cost of sales
Foreign exchange contracts	(20		)	1			10			15			—		—		Sales
Forward starting interest rate and treasury lock swap contracts	1			(9		)	(1		)	(2		)	—		—		Net interest expense
Derivatives in fair value hedging relationships:
Fixed-for-floating interest rate swaps	—			—			—			—			1		3		Net interest expense
Non-derivatives in net investment hedging relationships:
Net investment hedges (pre-tax)	(91		)	3			—			—			—		—		N/A
Derivatives not designated as hedges: (1)
Foreign Exchange Contracts	—			—			—			—			10		23		Other (income) charges, net

⁽¹⁾  The gains or losses on derivatives that are not designated as hedges are marked to market and represent foreign exchange derivatives denominated in multiple currencies and are transacted and settled in the same quarter.

(Dollars in millions)	Change in amount of after tax gain/(loss) recognized in OCI on derivatives (effective portion)						Pre-tax amount of gain/(loss) reclassified from Accumulated OCI into income (effective portion)						Additional pre-tax gain/(loss) recognized in earnings (effective portion)
	First Six Months						First Six Months						First Six Months
Hedging Relationships	2017			2016			2017			2016			2017		2016		Income Statement Classification
Derivatives in cash flow hedging relationships:
Commodity contracts	$	(7	)	$	109		$	(27	)	$	(85	)	$	—	$	—	Cost of sales
Foreign exchange contracts	(30		)	(25		)	22			30			—		—		Sales
Forward starting interest rate and treasury lock swap contracts	2			(27		)	(2		)	(4		)	—		—		Net interest expense
Derivatives in fair value hedging relationships:
Fixed-for-floating interest rate swaps	—			—			—			—			2		7		Net interest expense
Non-derivatives in net investment hedging relationships:
Net investment hedges (pre-tax)	(109		)	3			—			—			—		—		N/A
Derivatives not designated as hedges: (1)
Foreign Exchange Contracts	—			—			—			—			4		14		Other (income) charges, net

⁽¹⁾  The gains or losses on derivatives that are not designated as hedges are marked to market and represent foreign exchange derivatives denominated in multiple currencies and are transacted and settled in the same quarter.

Pre-tax monetized positions and mark-to-market gains and losses from raw materials and energy, currency, and certain interest rate hedges that were included in AOCI included losses of $223 million at June 30, 2017 and losses of $57 million at December 31, 2016. Losses in AOCI increased June 30, 2017 compared to December 31, 2016 primarily as a result of an increase in foreign currency exchange rates, particularly the euro. If realized, approximately $43 million in pre-tax losses, as of June 30, 2017, will be reclassified into earnings during the next 12 months.

Any ineffectiveness from the hedging programs are immediately recognized in earnings. The Company had no material ineffectiveness from the hedging programs during second quarter and first six months2017 and 2016.

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RETIREMENT PLANS

6 Months Ended

Jun. 30, 2017

Compensation and Retirement Disclosure [Abstract]

RETIREMENT PLANS

RETIREMENT PLANS

Defined Benefit Pension Plans and Other Postretirement Benefit Plans

Eastman maintains defined benefit pension plans that provide eligible employees with retirement benefits. In addition, Eastman provides life insurance for eligible retirees hired prior to January 1, 2007. Eastman provides a subsidy for pre-Medicare health care and dental benefits to eligible retirees hired prior to January 1, 2007 that will end on December 31, 2021. Company funding is also provided for eligible Medicare retirees hired prior to January 1, 2007 with a health reimbursement arrangement. Costs recognized for these benefits are estimated amounts, which may change as actual costs derived for the year are determined.

For additional information regarding retirement plans, see Note 11, "Retirement Plans", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K.

Components of net periodic benefit (credit) cost were as follows:

	Second Quarter
	Pension Plans												Other Postretirement Benefit Plans
	2017						2016						2017			2016
(Dollars in millions)	U.S.			Non-U.S.			U.S.			Non-U.S.
Components of net periodic benefit (credit) cost:
Service cost	$	9		$	4		$	10		$	3		$	1		$	1
Interest cost	16			4			19			6			6			7
Expected return on assets	(35		)	(9		)	(34		)	(8		)	(1		)	(1		)
Amortization of:
Prior service credit, net	(1		)	—			(1		)	—			(10		)	(10		)
Net periodic benefit (credit) cost	$	(11	)	$	(1	)	$	(6	)	$	1		$	(4	)	$	(3	)
	First Six Months
	Pension Plans												Other Postretirement Benefit Plans
	2017						2016						2017			2016
(Dollars in millions)	U.S.			Non-U.S.			U.S.			Non-U.S.
Components of net periodic benefit (credit) cost:
Service cost	$	18		$	7		$	20		$	6		$	2		$	3
Interest cost	33			9			37			12			12			14
Expected return on assets	(70		)	(17		)	(68		)	(16		)	(3		)	(3		)
Amortization of:
Prior service credit, net	(2		)	—			(2		)	—			(20		)	(20		)
Net periodic benefit (credit) cost	$	(21	)	$	(1	)	$	(13	)	$	2		$	(9	)	$	(6	)

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COMMITMENTS

6 Months Ended

Jun. 30, 2017

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS

COMMITMENTS AND OFF BALANCE SHEET ARRANGEMENTS

Purchase Obligations and Lease Commitments

The Company had various purchase obligations at June 30, 2017, totaling approximately $2.9 billion over a period of approximately 30 years for materials, supplies, and energy incident to the ordinary conduct of business. The Company also had various lease commitments for property and equipment under cancelable, noncancelable, and month-to-month operating leases totaling $295 million over a period of approximately 40 years. Of the total lease commitments, approximately 45 percent relate to real property, including office space, storage facilities, and land; approximately 45 percent relate to railcars; and approximately 10 percent relate to machinery and equipment, including computer and communications equipment and production equipment.

Guarantees

The Company has operating leases with terms that require the Company to guarantee a portion of the residual value of the leased assets upon termination of the lease as well as other guarantees. Disclosures about each group of similar guarantees are provided below.

Residual Value Guarantees

The Company has operating leases with terms that require the Company to guarantee a portion of the residual value of the leased assets upon termination of the lease. These residual value guarantees totaled $71 million at June 30, 2017 and consist primarily of leases for railcars that will expire beginning in third quarter 2018. Residual guarantee payments that become probable and estimable are recognized as rent expense over the remaining life of the applicable lease. Management's current expectation is that the likelihood of material residual guarantee payments is remote.

Other Guarantees

Guarantees and claims also arise during the ordinary course of business from relationships with customers, suppliers, joint venture partners, and other parties when the Company undertakes an obligation to guarantee the performance of others if specified triggering events occur. Non-performance under a contract could trigger an obligation of the Company. The Company's current other guarantees include guarantees relating to intellectual property, environmental matters, and other indemnifications and have arisen through the normal course of business. The ultimate effect on future financial results is not subject to reasonable estimation because considerable uncertainty exists as to the final outcome of these claims, if they were to occur. These other guarantees have terms up to 30 years with maximum potential future payments of approximately $35 million in the aggregate, with none of these guarantees being individually significant to the Company's operating results, financial position, or liquidity. Management's current expectation is that future payment or performance related to non-performance under other guarantees is remote.

Other Off Balance Sheet Arrangements

The Company has rights and obligations under non-recourse factoring facilities that have a combined limit of €150 million ($171 million) as of June 30, 2017 and are committed until December 2017. These arrangements include receivables in the United States, Belgium, and Finland, and are subject to various eligibility requirements. The Company sells the receivables at face value but receives funding (approximately 85 percent) net of a deposit amount until collections are received from customers for the receivables sold. The total amounts of cumulative receivables sold in second quarter and first six months 2017, were approximately $250 million and $500 million, respectively. The total amounts of cumulative receivables sold in second quarter and first six months 2016, were approximately $225 million and $460 million, respectively. As part of the program, the Company continues to service the sold receivables at market rates with no servicing assets or liabilities recognized. The amounts of sold receivables outstanding under the non-recourse factoring facilities were $122 million and $99 million at June 30, 2017 and December 31, 2016, respectively. The fair value of the receivables sold equals the carrying value at the time of the sale, and no gain or loss is recognized. The Company is exposed to a credit loss of up to 10 percent on sold receivables.

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ENVIRONMENTAL MATTERS AND ASSET RETIREMENT OBLIGATIONS

6 Months Ended

Jun. 30, 2017

Accrual for Environmental Loss Contingencies Disclosure [Abstract]

Environmental Matters

ENVIRONMENTAL MATTERS AND ASSET RETIREMENT OBLIGATIONS

Certain Eastman manufacturing sites generate hazardous and nonhazardous wastes, the treatment, storage, transportation, and disposal of which are regulated by various governmental agencies. In connection with the cleanup of various hazardous waste sites, the Company, along with many other entities, has been designated a potentially responsible party ("PRP") by the U.S. Environmental Protection Agency under the Comprehensive Environmental Response, Compensation and Liability Act, which potentially subjects PRPs to joint and several liability for such cleanup costs. In addition, the Company will incur costs for environmental remediation and closure and post-closure under the federal Resource Conservation and Recovery Act. Reserves for environmental contingencies have been established in accordance with Eastman's policies described in Note 1, "Significant Accounting Policies", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K. Although the resolution of uncertainties related to these environmental matters may have a material adverse effect on the Company's consolidated results of operations in the period recognized, because of the availability of legal defenses, the Company's preliminary assessment of actions that may be required, and if applicable the expected sharing of costs, management does not believe that the Company's liability for these environmental matters, individually or in the aggregate, will be material to the Company's consolidated financial position or cash flows. The Company's total reserve for environmental contingencies was $318 million and $321 million at June 30, 2017 and December 31, 2016, respectively. At both June 30, 2017 and December 31, 2016, this reserve included $8 million related to sites previously closed and impaired by Eastman and sites that have been divested by Eastman but for which the Company retains the environmental liability related to these sites.

The Company's total environmental reserve that management believes to be probable and estimable for environmental contingencies, including remediation costs and asset retirement obligations, is included as part of "Payables and other current liabilities" and "Other long-term liabilities" in the Unaudited Consolidated Statements of Financial Position as follows:

(Dollars in millions)	June 30, 2017		December 31, 2016
Environmental contingent liabilities, current	$	30	$	30
Environmental contingent liabilities, long-term	288		291
Total	$	318	$	321

Remediation

Estimated future environmental expenditures for undiscounted remediation costs ranged from the best estimate or minimum of $291 million to the maximum of $500 million and from the best estimate or minimum of $295 million to the maximum of $503 million at June 30, 2017 and December 31, 2016, respectively. The estimated future costs are considered to be reasonably possible and include the amounts recognized at both June 30, 2017 and December 31, 2016.

Reserves for environmental remediation include liabilities expected to be paid within approximately 30 years. The amounts charged to pre-tax earnings for environmental remediation and related charges are included within "Cost of sales" in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings. Changes in the reserves for environmental remediation liabilities during first six months 2017 are summarized below:

(Dollars in millions)	Environmental Remediation Liabilities
Balance at December 31, 2016	$	295
Changes in estimates recognized in earnings and other	5
Cash reductions	(9		)
Balance at June 30, 2017	$	291

Closure/Post-Closure

An asset retirement obligation is an obligation for the retirement of a tangible long-lived asset that is incurred upon the acquisition, construction, development, or normal operation of that long-lived asset. The Company recognizes asset retirement obligations in the period in which they are incurred if a reasonable estimate of fair value can be made. The asset retirement obligations are discounted to expected present value and subsequently adjusted for changes in fair value. The associated estimated asset retirement costs are capitalized as part of the carrying value of the long-lived assets and depreciated over their useful life. Environmental asset retirement obligations consist primarily of closure and post-closure costs. For sites that have environmental asset retirement obligations, the best estimate recognized to date over the sites estimated useful lives for these environmental asset retirement obligation costs was $27 million and $26 million at June 30, 2017 and December 31, 2016, respectively. 

Other

The Company has contractual asset retirement obligations not associated with environmental liabilities. Eastman's non-environmental asset retirement obligations are primarily associated with the future closure of leased manufacturing assets at Pace, Florida and Oulu, Finland. These recognized non-environmental asset retirement obligations were $47 million and $46 million at June 30, 2017 and December 31, 2016, respectively.

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LEGAL MATTERS

6 Months Ended

Jun. 30, 2017

Loss Contingency, Information about Litigation Matters [Abstract]

LEGAL MATTERS

LEGAL MATTERS

From time to time, the Company and its operations are parties to, or targets of, lawsuits, claims, investigations and proceedings, including product liability, personal injury, asbestos, patent and intellectual property, commercial, contract, environmental, antitrust, health and safety, and employment matters, which are being handled and defended in the ordinary course of business. While the Company is unable to predict the outcome of these matters, it does not believe, based upon currently available facts, that the ultimate resolution of any such pending matters will have a material adverse effect on its overall financial condition, results of operations, or cash flows.

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STOCKHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2017

Stockholders' Equity Note [Abstract]

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

A reconciliation of the changes in stockholders' equity for first six months 2017 is provided below:

(Dollars in millions)	Common Stock at Par Value		Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock at Cost			Total Stockholders' Equity Attributed to Eastman			Noncontrolling Interest			Total Stockholders' Equity
Balance at December 31, 2016	$	2	$	1,915		$	5,721		$	(281	)	$	(2,825	)	$	4,532		$	76		$	4,608
Net Earnings	—		—			570			—			—			570			3			573
Cash Dividends Declared (1) ($1.02 per share)	—		—			(149		)	—			—			(149		)	—			(149		)
Other Comprehensive Income	—		—			—			(5		)	—			(5		)	—			(5		)
Share-Based Compensation Expense (2)	—		27			—			—			—			27			—			27
Stock Option Exercises	—		17			—			—			—			17			—			17
Other	—		(5		)	—			—			—			(5		)	(1		)	(6		)
Share Repurchases	—		—			—			—			(175		)	(175		)	—			(175		)
Balance at June 30, 2017	$	2	$	1,954		$	6,142		$	(286	)	$	(3,000	)	$	4,812		$	78		$	4,890

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

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

Accumulated Other Comprehensive Income (Loss), Net of Tax

(Dollars in millions)	Cumulative Translation Adjustment			Benefit Plans Unrecognized Prior Service Credits			Unrealized Gains (Losses) on Derivative Instruments			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	43			(13		)	(35		)	—			(5		)
Balance at June 30, 2017	$	(338	)	$	150		$	(97	)	$	(1	)	$	(286	)

Amounts of other comprehensive income (loss) are presented net of applicable taxes. The Company recognizes 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 such cumulative translation adjustment is considered to be a component of indefinitely invested, unremitted earnings of these foreign subsidiaries.

Components of other comprehensive income recognized in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings are presented below, before tax and net of tax effects:

	Second Quarter
	2017						2016
(Dollars in millions)	Before Tax			Net of Tax			Before Tax			Net of Tax
Other comprehensive income (loss)
Change in cumulative translation adjustment	$	36		$	36		$	(70	)	$	(70	)
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits included in net periodic costs (1)	(11		)	(6		)	(11		)	(7		)
Derivatives and hedging: (2)
Unrealized gain (loss) during period	(28		)	(18		)	62			38
Reclassification adjustment for losses included in net income, net	13			8			53			33
Total other comprehensive income (loss)	$	10		$	20		$	34		$	(6	)

	First Six Months
	2017						2016
(Dollars in millions)	Before Tax			Net of Tax			Before Tax			Net of Tax
Other comprehensive income (loss)
Change in cumulative translation adjustment	$	43		$	43		$	36		$	36
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits included in net periodic costs (1)	(22		)	(13		)	(22		)	(14		)
Derivatives and hedging: (2)
Unrealized gain (loss) during period	(62		)	(39		)	32			20
Reclassification adjustment for losses included in net income, net	7			4			60			37
Total other comprehensive income (loss)	$	(34	)	$	(5	)	$	106		$	79

⁽¹⁾  Included in the calculation of net periodic benefit costs for pension and other postretirement benefit plans. See Note 7, "Retirement Plans".

⁽²⁾  For additional information regarding the impact of reclassifications into earnings, see Note 6, "Derivative and Non-Derivative Financial Instruments".

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EARNINGS AND DIVIDENDS PER SHARE

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

EARNINGS AND DIVIDENDS PER SHARE

EARNINGS AND DIVIDENDS PER SHARE

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

	Second Quarter				First Six Months
(In millions, except per share amounts)	2017		2016		2017		2016
Numerator
Earnings attributable to Eastman:
Earnings, net of tax	$	292	$	255	$	570	$	506
Denominator
Weighted average shares used for basic EPS	145.3		147.8		145.7		147.8
Dilutive effect of stock options and other awards	1.1		1.1		1.1		1.1
Weighted average shares used for diluted EPS	146.4		148.9		146.8		148.9
(Calculated using whole dollars and shares)
EPS
Basic	$	2.01	$	1.73	$	3.91	$	3.43
Diluted	$	2.00	$	1.71	$	3.89	$	3.40

In second quarter and first six months2017 options to purchase 850,970 and 1,008,667 shares of common stock, respectively, were excluded from the shares treated as outstanding for computation of diluted earnings per share because the total market value of option exercises for these awards was less than the total cash proceeds that would be received for these exercises. Second quarter and first six months2017 reflect the impact of share repurchases of 1,232,977 and 2,176,676, respectively.

In second quarter and first six months2016, options to purchase 1,056,961 and 1,076,935 shares of common stock, respectively, were excluded from the shares treated as outstanding for computation of diluted earnings per share because the total market value of option exercises for these awards was less than the total cash proceeds that would be received for these exercises. Second quarter and first six months2016 reflect the impact of share repurchases of 344,790 and 632,071, respectively.

The Company declared cash dividends of $0.51 and $0.46 per share in second quarter2017 and 2016, respectively, and $1.02 and $0.92 per share in first six months2017 and 2016, respectively.

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ASSETS IMPAIRMENTS AND RESTRUCTURING

6 Months Ended

Jun. 30, 2017

Restructuring Costs and Asset Impairment Charges [Abstract]

ASSET IMPAIRMENTS AND RESTRUCTURING

ASSET IMPAIRMENTS AND RESTRUCTURING

In second quarter and first six months 2017, there were no asset impairment and restructuring charges. In first six months 2016, there was a gain of $2 million in the Additives & Functional Products segment for the sale of previously impaired assets at the Crystex^® insoluble sulfur research and development site in France.

Changes in Reserves for Asset Impairments, Restructuring Charges, Net, and Severance Charges

The following table summarizes the changes in asset impairments and restructuring charges and gains, the non-cash reductions attributable to asset impairments, and the cash reductions in restructuring reserves for severance costs and site closure costs paid in first six months2017 and full year 2016:

(Dollars in millions)	Balance at January 1, 2017		Provision/ Adjustments		Non-cash Reductions/ Additions		Cash Reductions			Balance at June 30, 2017
Severance costs	$	42	$	—	$	—	$	(22	)	$	20
Site closure and restructuring costs	13		—		1		(2		)	12
Total	$	55	$	—	$	1	$	(24	)	$	32

(Dollars in millions)	Balance at January 1, 2016		Provision/ Adjustments		Non-cash Reductions/ Additions			Cash Reductions			Balance at December 31, 2016
Non-cash charges	$	—	$	12	$	(12	)	$	—		$	—
Severance costs	55		32		—			(45		)	42
Site closure and restructuring costs	11		1		4			(3		)	13
Total	$	66	$	45	$	(8	)	$	(48	)	$	55

Substantially all severance costs remaining are expected to be applied to the reserves within one year.

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SHARE-BASED COMPENSATION AWARDS

6 Months Ended

Jun. 30, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

SHARE-BASED COMPENSATION AWARDS

SHARE-BASED COMPENSATION AWARDS

The Company utilizes share-based awards under employee and non-employee director compensation programs. These share-based awards may include restricted and unrestricted stock, restricted stock units, stock options, and performance shares. In second quarter2017 and 2016, $13 million and $7 million, respectively, of compensation expense before tax were recognized in "Selling, general and administrative expenses" in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings for all share-based awards. The impact on second quarter2017 and 2016 net earnings of $8 million and $4 million, respectively, is net of deferred tax expense related to share-based award compensation for each period.

In first six months2017 and 2016, $27 million and $20 million, respectively, of compensation expense before tax were recognized in "Selling, general and administrative expenses" in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings for all share-based awards. The impact on first six months2017 and 2016 net earnings of $17 million and $12 million, respectively, is net of deferred tax expense related to share-based award compensation for each period.

For additional information regarding share-based compensation plans and awards, see Note 18, "Share-Based Compensation Plans and Awards", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K.

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SUPPLEMENTAL CASH FLOW INFORMATION

6 Months Ended

Jun. 30, 2017

Supplemental Cash Flow Information [Abstract]

SUPPLEMENTAL CASH FLOW INFORMATION

SUPPLEMENTAL CASH FLOW INFORMATION

Included in the line item "Other items, net" of the "Operating activities" section of the Unaudited Consolidated Statements of Cash Flows are the following changes to Unaudited Consolidated Statement of Financial Position:

(Dollars in millions)	First Six Months
	2017			2016
Other current assets	$	(3	)	$	(13	)
Other noncurrent assets	7			14
Payables and other current liabilities	(30		)	40
Long-term liabilities and equity	—			(30		)
Total	$	(26	)	$	11

The above changes resulted primarily from accrued taxes, deferred taxes, environmental liabilities, monetized positions from raw material and energy, currency, and certain interest rate hedges, prepaid insurance, miscellaneous deferrals, value-added taxes, and other miscellaneous accruals.

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SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2017

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

The Company's products and operations are managed and reported in four operating segments: Additives & Functional Products ("AFP"), Advanced Materials ("AM"), Chemical Intermediates ("CI"), and Fibers. For additional financial and product information for each segment, see Part 1, Item 1, Business -- Business Segments and Part II, Item 8, Note 20, "Segment Information", in the Company's 2016 Annual Report on Form 10-K.

	Second Quarter				First Six Months
(Dollars in millions)	2017		2016		2017		2016
Sales
Additives & Functional Products	$	830	$	770	$	1,603	$	1,507
Advanced Materials	657		646		1,291		1,235
Chemical Intermediates	703		633		1,373		1,253
Fibers	215		234		428		514
Total Sales by Segment	2,405		2,283		4,695		4,509
Other	14		14		27		24
Total Sales	$	2,419	$	2,297	$	4,722	$	4,533

	Second Quarter						First Six Months
(Dollars in millions)	2017			2016			2017			2016
Operating Earnings (Loss)
Additives & Functional Products	$	159		$	168		$	311		$	321
Advanced Materials	137			132			258			240
Chemical Intermediates	83			15			165			82
Fibers	55			72			107			158
Total Operating Earnings by Segment	434			387			841			801
Other
Growth initiatives and businesses not allocated to segments	(32		)	(24		)	(60		)	(42		)
Pension and other postretirement benefits income, net not allocated to operating segments	18			13			36			25
Acquisition integration and transaction costs	—			—			—			(9		)
Total Operating Earnings	$	420		$	376		$	817		$	775

	June 30,		December 31,
(Dollars in millions)	2017		2016
Assets by Segment (1)
Additives & Functional Products	$	6,497	$	6,255
Advanced Materials	4,382		4,247
Chemical Intermediates	2,997		2,927
Fibers	950		920
Total Assets by Segment	14,826		14,349
Corporate Assets	1,138		1,108
Total Assets	$	15,964	$	15,457

⁽¹⁾  Segment assets include accounts receivable, inventory, fixed assets, goodwill, and intangible assets. Segment asset balances for shared fixed assets within the CI and Fibers segments as of December 31, 2016 have been reclassified to conform to current period allocation methodology.

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RECENTLY ISSUED ACCOUNTING STANDARDS

6 Months Ended

Jun. 30, 2017

Recently Issued Accounting Standards [Abstract]

Recently Issued Accounting Standards [Text Block]

RECENTLY ISSUED ACCOUNTING STANDARDS

In May 2014, the Financial Accounting Standards Board ("FASB") and International Accounting Standards Board jointly issued new principles-based accounting guidance for revenue recognition that provides a five-step process to the principles-based guidance. In August 2015, the FASB issued new guidance to delay the effective date of the new revenue standard by one year. The deferral results in the new revenue standard being effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early application is permitted under the original effective date of fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. In April 2016, the FASB issued clarifying guidance to the 2014 revenue standard in regard to the identification of performance obligations and licensing. In May 2016, the FASB issued narrow-scope improvements and practical expedients to the new revenue standard that include clarification of the collectability criterion, specification for the measurement of noncash considerations, clarifies a completed contract for transition purposes and clarification in regards to the retrospective application, as well as, policy elections, and other practical expedients. In December 2016, the FASB issued additional corrections and improvements that affect various narrow aspects of the guidance. The effective date for all amendments is the same as that of the revenue standard stated above. Management does not expect that changes in its accounting required by this new guidance will materially impact the Company's financial statements and related disclosures. Management plans to adopt the new guidance January 1, 2018, and anticipates adopting retrospectively to each prior reporting period presented with the election of applicable practical expedients.

In February 2016, the FASB issued guidance on lease accounting. The new guidance establishes two types of leases for lessees: finance and operating. Both finance and operating leases will have associated right-of-use assets and liabilities initially measured at the present value of the lease payments. This guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period and early adoption is permitted. The new guidance is to be applied under a modified retrospective approach wherein practical expedients have been allowed that will not require reassessment of current leases at the effective date. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

In June 2016, the FASB issued guidance relating to credit losses. The amendments require a financial asset (including trade receivables) to be presented at the net amount expected to be collected through the use of allowances for credit losses valuation account. The income statement will reflect the measurement of credit losses for newly recognized financial assets, as well as the expected increases or decreases of expected credit losses that have taken place during the period. This guidance is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period and early adoption is permitted, including adoption in an interim period, beginning after December 15, 2018. The new guidance application is mixed among the various elements that include modified retrospective and prospective transition methods. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

In October 2016, the FASB issued guidance as a part of its simplification initiative in regards to income tax of intra-entity asset transfers. The release requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. Consequently, the amendments eliminate the exception for an intra-entity transfer of an asset other than inventory that prohibited recognizing current and deferred income tax consequences for an intra-entity asset transfer until the asset or assets have been sold to an outside party. This guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods and early adoption is permitted as of the beginning of an annual reporting period for which financial statements (interim or annual) have not been issued or made available for issuance. The new guidance is to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

In January 2017, the FASB issued guidance clarifying the definition of a business that provides a two-step analysis in the determination of whether an acquisition or derecognition is a business or an asset. The update removes the evaluation of whether a market participant could replace any missing elements and provides a framework to assist entities in evaluating whether both an input and a substantive process are present. This guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods and early adoption is permitted for transactions that meet specified criteria. This guidance is to be applied on a prospective basis for transactions that occur after the effective date.

In January 2017, the FASB issued guidance as a part of its simplification initiative that bases the impairment of goodwill on any difference for which the carrying value is greater than the fair value of the reporting unit. This guidance is effective for annual reporting periods, or interim period testing performed, beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment testing performed after January 1, 2017. This guidance is to be applied on a prospective basis for goodwill testing that occur after the effective date.

In February 2017, the FASB issued guidance that clarifies the scope of nonfinancial asset derecognition and the accounting for partial sales of nonfinancial assets. This guidance is effective at the same time as the amendments in the revenue recognition standard stated above, for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, and must be applied in conjunction with that standard. Adoption can be applied either on a retrospective or modified retrospective approach. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

In March 2017, the FASB issued guidance to improve the presentation of net periodic pension and postretirement benefit costs that will require the reporting of the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost (interest cost, expected return on plan assets, curtailment gains or losses, amortization of prior service costs or credits, and mark-to-market gains or losses) are to be presented in the income statement separately from the service cost component and outside the subtotal of income from operations. In addition, the amendment prescribes only the service cost component to be eligible for capitalization. This guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods and early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. The new guidance is to be applied retrospectively for income statement effect and prospectively for balance sheet effects. Management is currently evaluating the impact on the Company's financial statements and related disclosures.

In May 2017, the FASB issued guidance to clarify when changes to the terms or conditions of a share-based payment award would require an entity to apply modification accounting. This guidance is effective for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period, for reporting periods for which financial statements have not yet been issued. The new guidance is to be applied prospectively to an award modified on or after the adoption date.

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INVENTORIES (Tables)

6 Months Ended

Jun. 30, 2017

Inventory Disclosure [Abstract]

Schedule of inventories

	June 30,		December 31,
(Dollars in millions)	2017		2016
Finished goods	$	1,103	$	997
Work in process	220		198
Raw materials and supplies	478		473
Total inventories at FIFO or average cost	1,801		1,668
Less: LIFO reserve	261		264
Total inventories	$	1,540	$	1,404

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PAYABLES AND OTHER CURRENT LIABILITIES (Tables)

6 Months Ended

Jun. 30, 2017

Payables and Accruals [Abstract]

Schedule of payables and other current liabilities

	June 30,		December 31,
(Dollars in millions)	2017		2016
Trade creditors	$	675	$	704
Accrued payrolls, vacation, and variable-incentive compensation	125		196
Accrued taxes	90		106
Post-employment obligations	84		110
Derivative hedging liability	82		72
Other	328		324
Total payables and other current liabilities	$	1,384	$	1,512

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PROVISION FOR INCOME TAXES (Tables)

6 Months Ended

Jun. 30, 2017

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

	Second Quarter								First Six Months
(Dollars in millions)	2017				2016				2017				2016
	$		%		$		%		$		%		$		%
Provision for income taxes and tax rate	$	65	18	%	$	67	21	%	$	127	18	%	$	139	22	%

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BORROWINGS (Tables)

6 Months Ended

Jun. 30, 2017

Debt Disclosure [Abstract]

Long-term Borrowings

	June 30,		December 31,
(Dollars in millions)	2017		2016
Borrowings consisted of:
5.5% notes due November 2019	$	250	$	249
2.7% notes due January 2020	796		796
4.5% notes due January 2021	184		184
3.6% notes due August 2022	739		741
1.50% notes due May 2023 (1)	852		786
7 1/4% debentures due January 2024	197		197
7 5/8% debentures due June 2024	43		43
3.8% notes due March 2025	690		689
1.875% notes due November 2026(1)	563		519
7.60% debentures due February 2027	195		195
4.8% notes due September 2042	493		493
4.65% notes due October 2044	871		870
Credit facilities borrowings	799		549
Commercial paper borrowings	200		280
Capital leases and other	9		3
Total borrowings	6,881		6,594
Borrowings due within one year	212		283
Long-term borrowings	$	6,669	$	6,311

⁽¹⁾  The carrying value of the euro-denominated 1.50% notes due May 2023 and 1.875% notes due November 2026 will fluctuate with changes in the euro exchange rate. The carrying value of these euro-denominated borrowings have been designated as non-derivative net investment hedges of a portion of the Company's net investments in euro functional-currency denominated subsidiaries to offset foreign currency fluctuations. During the six months endedJune 30, 2017 and 2016, pre-tax losses of $109 million and gains of $3 million, respectively, were recognized in "Other comprehensive income (loss)" ("OCI") for revaluation of these notes.

Fair Value of Borrowings

			Fair Value Measurements at June 30, 2017
(Dollars in millions)	Recorded Amount June 30, 2017		Total Fair Value		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)
Long-term borrowings	$	6,669	$	7,069	$	6,273	$	796

			Fair Value Measurements at December 31, 2016
(Dollars in millions)	Recorded Amount December 31, 2016		Total Fair Value		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)
Long-term borrowings	$	6,311	$	6,586	$	6,036	$	550

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DERIVATIVE AND NON-DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2017

Derivative Instruments, Gain (Loss) [Line Items]

Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block]

The following table shows the notional amounts outstanding atJune 30, 2017 and December 31, 2016associated with the Company's hedging programs.

Notional Outstanding		June 30, 2017	December 31, 2016
Derivatives designated as cash flow hedges:
Foreign Exchange Forward and Option Contracts (in millions)
	EUR/USD (in EUR)	€360	€378
	EUR/USD (in approximate USD equivalent)	$411	$398
	JPY/USD (in JPY)	¥900	¥1,800
	JPY/USD (in approximate USD equivalent)	$8	$15
Commodity Forward and Collar Contracts
	Feedstock (in million barrels)	10	11
	Energy (in million million british thermal units)	20	23
Derivatives designated as fair value hedges:
Fixed-for-floating interest rate swaps (in millions)		$75	$75
Non-derivatives designated as net investment hedges:
Foreign Currency Net Investment Hedges (in millions)
	EUR/USD (in EUR)	€1,239	€1,238

Derivative Instrument Gain Loss in Statement of Financial Performance

The tables below present the effect of hedging instruments on OCI and the financial performance for second quarter and first six months2017 and 2016:

(Dollars in millions)	Change in amount of after tax gain/(loss) recognized in OCI on derivatives (effective portion)						Pre-tax amount of gain/(loss) reclassified from Accumulated OCI into income (effective portion)						Additional pre-tax gain/(loss) recognized in earnings (effective portion)
	Second Quarter						Second Quarter						Second Quarter
Hedging Relationships	2017			2016			2017			2016			2017		2016		Income Statement Classification
Derivatives in cash flow hedging relationships:
Commodity contracts	$	9		$	79		$	(20	)	$	(65	)	$	—	$	—	Cost of sales
Foreign exchange contracts	(20		)	1			10			15			—		—		Sales
Forward starting interest rate and treasury lock swap contracts	1			(9		)	(1		)	(2		)	—		—		Net interest expense
Derivatives in fair value hedging relationships:
Fixed-for-floating interest rate swaps	—			—			—			—			1		3		Net interest expense
Non-derivatives in net investment hedging relationships:
Net investment hedges (pre-tax)	(91		)	3			—			—			—		—		N/A
Derivatives not designated as hedges: (1)
Foreign Exchange Contracts	—			—			—			—			10		23		Other (income) charges, net

⁽¹⁾  The gains or losses on derivatives that are not designated as hedges are marked to market and represent foreign exchange derivatives denominated in multiple currencies and are transacted and settled in the same quarter.

(Dollars in millions)	Change in amount of after tax gain/(loss) recognized in OCI on derivatives (effective portion)						Pre-tax amount of gain/(loss) reclassified from Accumulated OCI into income (effective portion)						Additional pre-tax gain/(loss) recognized in earnings (effective portion)
	First Six Months						First Six Months						First Six Months
Hedging Relationships	2017			2016			2017			2016			2017		2016		Income Statement Classification
Derivatives in cash flow hedging relationships:
Commodity contracts	$	(7	)	$	109		$	(27	)	$	(85	)	$	—	$	—	Cost of sales
Foreign exchange contracts	(30		)	(25		)	22			30			—		—		Sales
Forward starting interest rate and treasury lock swap contracts	2			(27		)	(2		)	(4		)	—		—		Net interest expense
Derivatives in fair value hedging relationships:
Fixed-for-floating interest rate swaps	—			—			—			—			2		7		Net interest expense
Non-derivatives in net investment hedging relationships:
Net investment hedges (pre-tax)	(109		)	3			—			—			—		—		N/A
Derivatives not designated as hedges: (1)
Foreign Exchange Contracts	—			—			—			—			4		14		Other (income) charges, net

⁽¹⁾  The gains or losses on derivatives that are not designated as hedges are marked to market and represent foreign exchange derivatives denominated in multiple currencies and are transacted and settled in the same quarter.

Financial assets and liabilities valued on a recurring basis

The following table shows the financial assets and liabilities valued on a gross basis as ofJune 30, 2017 and December 31, 2016. Additionally, the table below indicates where the derivatives are reported on the Unaudited Consolidated Statements of Financial Position. During the periods presented, there were no transfers between fair value hierarchy levels.

The Financial Position and Fair Value Measurements of Hedging Instruments on a Gross Basis
(Dollars in millions)
Derivative Type	Statements of Financial Position Classification	June 30, 2017 Level 2		December 31, 2016 Level 2
Derivatives designated as cash flow hedges:
Commodity contracts	Other current assets	$	1	$	5
Commodity contracts	Other noncurrent assets	—		2
Foreign exchange contracts	Other current assets	35		49
Foreign exchange contracts	Other noncurrent assets	16		47
Derivatives designated as fair value hedges:
Fixed-for-floating interest rate swap	Other current assets	1		1
Total Derivative Assets		$	53	$	104
Derivatives designated as cash flow hedges:
Commodity contracts	Payables and other current liabilities	$	75	$	62
Commodity contracts	Other long-term liabilities	58		69
Foreign exchange contracts	Payables and other current liabilities	1		—
Foreign exchange contracts	Other long-term liabilities	1		—
Derivatives designated as fair value hedges:
Fixed-for-floating interest rate swap	Long-term borrowings	3		4
Total Derivative Liabilities		$	138	$	135
Total Net Derivative Liabilities		$	85	$	31

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RETIREMENT PLANS (Tables)

6 Months Ended

Jun. 30, 2017

Compensation and Retirement Disclosure [Abstract]

Components of net periodic benefit cost

Components of net periodic benefit (credit) cost were as follows:

	Second Quarter
	Pension Plans												Other Postretirement Benefit Plans
	2017						2016						2017			2016
(Dollars in millions)	U.S.			Non-U.S.			U.S.			Non-U.S.
Components of net periodic benefit (credit) cost:
Service cost	$	9		$	4		$	10		$	3		$	1		$	1
Interest cost	16			4			19			6			6			7
Expected return on assets	(35		)	(9		)	(34		)	(8		)	(1		)	(1		)
Amortization of:
Prior service credit, net	(1		)	—			(1		)	—			(10		)	(10		)
Net periodic benefit (credit) cost	$	(11	)	$	(1	)	$	(6	)	$	1		$	(4	)	$	(3	)
	First Six Months
	Pension Plans												Other Postretirement Benefit Plans
	2017						2016						2017			2016
(Dollars in millions)	U.S.			Non-U.S.			U.S.			Non-U.S.
Components of net periodic benefit (credit) cost:
Service cost	$	18		$	7		$	20		$	6		$	2		$	3
Interest cost	33			9			37			12			12			14
Expected return on assets	(70		)	(17		)	(68		)	(16		)	(3		)	(3		)
Amortization of:
Prior service credit, net	(2		)	—			(2		)	—			(20		)	(20		)
Net periodic benefit (credit) cost	$	(21	)	$	(1	)	$	(13	)	$	2		$	(9	)	$	(6	)

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ENVIRONMENTAL MATTERS AND ASSET RETIREMENT OBLIGATIONS (Tables)

6 Months Ended

Jun. 30, 2017

Accrual for Environmental Loss Contingencies Disclosure [Abstract]

Schedule of environmental liabilities, current and non-current

(Dollars in millions)	June 30, 2017		December 31, 2016
Environmental contingent liabilities, current	$	30	$	30
Environmental contingent liabilities, long-term	288		291
Total	$	318	$	321

Schedule of changes to environmental remediation liabilities

(Dollars in millions)	Environmental Remediation Liabilities
Balance at December 31, 2016	$	295
Changes in estimates recognized in earnings and other	5
Cash reductions	(9		)
Balance at June 30, 2017	$	291

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STOCKHOLDERS' EQUITY (Tables)

6 Months Ended

Jun. 30, 2017

Stockholders' Equity Note [Abstract]

Reconciliation of the changes in stockholders' equity

A reconciliation of the changes in stockholders' equity for first six months 2017 is provided below:

(Dollars in millions)	Common Stock at Par Value		Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock at Cost			Total Stockholders' Equity Attributed to Eastman			Noncontrolling Interest			Total Stockholders' Equity
Balance at December 31, 2016	$	2	$	1,915		$	5,721		$	(281	)	$	(2,825	)	$	4,532		$	76		$	4,608
Net Earnings	—		—			570			—			—			570			3			573
Cash Dividends Declared (1) ($1.02 per share)	—		—			(149		)	—			—			(149		)	—			(149		)
Other Comprehensive Income	—		—			—			(5		)	—			(5		)	—			(5		)
Share-Based Compensation Expense (2)	—		27			—			—			—			27			—			27
Stock Option Exercises	—		17			—			—			—			17			—			17
Other	—		(5		)	—			—			—			(5		)	(1		)	(6		)
Share Repurchases	—		—			—			—			(175		)	(175		)	—			(175		)
Balance at June 30, 2017	$	2	$	1,954		$	6,142		$	(286	)	$	(3,000	)	$	4,812		$	78		$	4,890

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

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

Accumulated Other Comprehensive Income (Loss)

(Dollars in millions)	Cumulative Translation Adjustment			Benefit Plans Unrecognized Prior Service Credits			Unrealized Gains (Losses) on Derivative Instruments			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	43			(13		)	(35		)	—			(5		)
Balance at June 30, 2017	$	(338	)	$	150		$	(97	)	$	(1	)	$	(286	)

Schedule of components of comprehensive income (loss) before tax and net of tax effects

Components of other comprehensive income recognized in the Unaudited Consolidated Statements of Earnings, Comprehensive Income and Retained Earnings are presented below, before tax and net of tax effects:

	Second Quarter
	2017						2016
(Dollars in millions)	Before Tax			Net of Tax			Before Tax			Net of Tax
Other comprehensive income (loss)
Change in cumulative translation adjustment	$	36		$	36		$	(70	)	$	(70	)
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits included in net periodic costs (1)	(11		)	(6		)	(11		)	(7		)
Derivatives and hedging: (2)
Unrealized gain (loss) during period	(28		)	(18		)	62			38
Reclassification adjustment for losses included in net income, net	13			8			53			33
Total other comprehensive income (loss)	$	10		$	20		$	34		$	(6	)

	First Six Months
	2017						2016
(Dollars in millions)	Before Tax			Net of Tax			Before Tax			Net of Tax
Other comprehensive income (loss)
Change in cumulative translation adjustment	$	43		$	43		$	36		$	36
Defined benefit pension and other postretirement benefit plans:
Amortization of unrecognized prior service credits included in net periodic costs (1)	(22		)	(13		)	(22		)	(14		)
Derivatives and hedging: (2)
Unrealized gain (loss) during period	(62		)	(39		)	32			20
Reclassification adjustment for losses included in net income, net	7			4			60			37
Total other comprehensive income (loss)	$	(34	)	$	(5	)	$	106		$	79

⁽¹⁾  Included in the calculation of net periodic benefit costs for pension and other postretirement benefit plans. See Note 7, "Retirement Plans".

⁽²⁾  For additional information regarding the impact of reclassifications into earnings, see Note 6, "Derivative and Non-Derivative Financial Instruments".

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EARNINGS AND DIVIDENDS PER SHARE (Tables)

6 Months Ended

Jun. 30, 2017

Earnings Per Share [Abstract]

Earnings per share, basic and diluted

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

	Second Quarter				First Six Months
(In millions, except per share amounts)	2017		2016		2017		2016
Numerator
Earnings attributable to Eastman:
Earnings, net of tax	$	292	$	255	$	570	$	506
Denominator
Weighted average shares used for basic EPS	145.3		147.8		145.7		147.8
Dilutive effect of stock options and other awards	1.1		1.1		1.1		1.1
Weighted average shares used for diluted EPS	146.4		148.9		146.8		148.9
(Calculated using whole dollars and shares)
EPS
Basic	$	2.01	$	1.73	$	3.91	$	3.43
Diluted	$	2.00	$	1.71	$	3.89	$	3.40

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ASSETS IMPAIRMENTS AND RESTRUCTURING (Tables)

6 Months Ended

Jun. 30, 2017

Restructuring Costs and Asset Impairment Charges [Abstract]

Changes to restructuring reserve and related activities

The following table summarizes the changes in asset impairments and restructuring charges and gains, the non-cash reductions attributable to asset impairments, and the cash reductions in restructuring reserves for severance costs and site closure costs paid in first six months2017 and full year 2016:

(Dollars in millions)	Balance at January 1, 2017		Provision/ Adjustments		Non-cash Reductions/ Additions		Cash Reductions			Balance at June 30, 2017
Severance costs	$	42	$	—	$	—	$	(22	)	$	20
Site closure and restructuring costs	13		—		1		(2		)	12
Total	$	55	$	—	$	1	$	(24	)	$	32

(Dollars in millions)	Balance at January 1, 2016		Provision/ Adjustments		Non-cash Reductions/ Additions			Cash Reductions			Balance at December 31, 2016
Non-cash charges	$	—	$	12	$	(12	)	$	—		$	—
Severance costs	55		32		—			(45		)	42
Site closure and restructuring costs	11		1		4			(3		)	13
Total	$	66	$	45	$	(8	)	$	(48	)	$	55

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SUPPLEMENTAL CASH FLOW INFORMATION (Tables)

6 Months Ended

Jun. 30, 2017

Supplemental Cash Flow Information [Abstract]

Schedule of Cash Flow, Supplemental Disclosures

Included in the line item "Other items, net" of the "Operating activities" section of the Unaudited Consolidated Statements of Cash Flows are the following changes to Unaudited Consolidated Statement of Financial Position:

(Dollars in millions)	First Six Months
	2017			2016
Other current assets	$	(3	)	$	(13	)
Other noncurrent assets	7			14
Payables and other current liabilities	(30		)	40
Long-term liabilities and equity	—			(30		)
Total	$	(26	)	$	11

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SEGMENT INFORMATION (Tables)

6 Months Ended

Jun. 30, 2017

Segment Reporting [Abstract]

Segment Information Disclosure

	Second Quarter				First Six Months
(Dollars in millions)	2017		2016		2017		2016
Sales
Additives & Functional Products	$	830	$	770	$	1,603	$	1,507
Advanced Materials	657		646		1,291		1,235
Chemical Intermediates	703		633		1,373		1,253
Fibers	215		234		428		514
Total Sales by Segment	2,405		2,283		4,695		4,509
Other	14		14		27		24
Total Sales	$	2,419	$	2,297	$	4,722	$	4,533

	Second Quarter						First Six Months
(Dollars in millions)	2017			2016			2017			2016
Operating Earnings (Loss)
Additives & Functional Products	$	159		$	168		$	311		$	321
Advanced Materials	137			132			258			240
Chemical Intermediates	83			15			165			82
Fibers	55			72			107			158
Total Operating Earnings by Segment	434			387			841			801
Other
Growth initiatives and businesses not allocated to segments	(32		)	(24		)	(60		)	(42		)
Pension and other postretirement benefits income, net not allocated to operating segments	18			13			36			25
Acquisition integration and transaction costs	—			—			—			(9		)
Total Operating Earnings	$	420		$	376		$	817		$	775

	June 30,		December 31,
(Dollars in millions)	2017		2016
Assets by Segment (1)
Additives & Functional Products	$	6,497	$	6,255
Advanced Materials	4,382		4,247
Chemical Intermediates	2,997		2,927
Fibers	950		920
Total Assets by Segment	14,826		14,349
Corporate Assets	1,138		1,108
Total Assets	$	15,964	$	15,457

⁽¹⁾  Segment assets include accounts receivable, inventory, fixed assets, goodwill, and intangible assets. Segment asset balances for shared fixed assets within the CI and Fibers segments as of December 31, 2016 have been reclassified to conform to current period allocation methodology.

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BASIS OF PRESENTATION Basis of Presentation (Details) $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2017 USD ($) Segment	Jun. 30, 2016 USD ($)	Dec. 31, 2016 USD ($)
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | $	$ 36	$ (70)	$ 43	$ 36	$ (97)
Number of Operating Segments | Segment			4

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INVENTORIES (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
At FIFO or average cost (approximates current cost) [Abstract]
Finished goods	$ 1,103	$ 997
Work in process	220	198
Raw materials and supplies	478	473
Total inventories	1,801	1,668
Less: LIFO Reserve	261	264
Total inventories	$ 1,540	$ 1,404
Inventories valued on the LIFO method	60.00%	60.00%

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PAYABLES AND OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Payables and Accruals [Abstract]
Trade creditors	$ 675	$ 704
Accrued payrolls, vacation, and variable-incentive compensation	125	196
Accrued taxes	90	106
Post-employment obligations	84	110
Derivative hedging liability	82	72
Other	328	324
Total payables and other current liabilities	$ 1,384	$ 1,512

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PROVISION FOR INCOME TAXES PROVISION FOR INCOME TAXES (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Income Tax Examination [Line Items]
Effective Income Tax Rate Reconciliation, Deduction, Other, Amount		$ 16		$ 16
Provision for income taxes	$ 65	$ 67	$ 127	$ 139
Effective Income Tax Rate Reconciliation, Percent	18.00%	21.00%	18.00%	22.00%
Effective Income Tax Rate Reconciliation, Prior Year Income Taxes, Amount	$ 22		$ 22	$ 9
Effective Income Tax Rate Reconciliation, Other Reconciling Items, Amount			$ 22

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BORROWINGS Part 1 (Details) Schedule of Long-term Debt Instruments - USD ($) $ in Millions		6 Months Ended
		Jun. 30, 2017	Dec. 31, 2016
Debt Instrument [Line Items]
Total Borrowings		$ 6,881	$ 6,594
Borrowings due within one year		212	283
Long-term borrowings		6,669	6,311
5.5% notes due November 2019 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 250	249
Debt Instrument, Interest Rate, Stated Percentage		5.50%
Debt Instrument, Maturity Date		Nov. 30, 2019
2.7% notes due January 2020 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 796	796
Debt Instrument, Interest Rate, Stated Percentage		2.70%
Debt Instrument, Maturity Date		Jan. 31, 2020
4.5% notes due January 2021 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 184	184
Debt Instrument, Interest Rate, Stated Percentage		4.50%
Debt Instrument, Maturity Date		Jan. 31, 2021
3.6% notes due August 2022 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 739	741
Debt Instrument, Interest Rate, Stated Percentage		3.60%
Debt Instrument, Maturity Date		Aug. 31, 2022
1.5% notes due May 2023 [Member]
Debt Instrument [Line Items]
Long-term Debt	[1]	$ 852	786
Debt Instrument, Interest Rate, Stated Percentage		1.50%
Debt Instrument, Maturity Date		May 31, 2023
7 1/4% debentures due January 2024 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 197	197
Debt Instrument, Interest Rate, Stated Percentage		7.25%
Debt Instrument, Maturity Date		Jan. 31, 2024
7 5/8% debentures due June 2024 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 43	43
Debt Instrument, Interest Rate, Stated Percentage		7.625%
Debt Instrument, Maturity Date		Jun. 30, 2024
3.8% notes due March 2025 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 690	689
Debt Instrument, Interest Rate, Stated Percentage		3.80%
Debt Instrument, Maturity Date		Mar. 31, 2025
1.875% notes due 2026 [Member]
Debt Instrument [Line Items]
Long-term Debt	[1]	$ 563	519
Debt Instrument, Interest Rate, Stated Percentage		1.875%
Debt Instrument, Maturity Date		Nov. 30, 2026
7.60% debentures due February 2027 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 195	195
Debt Instrument, Interest Rate, Stated Percentage		7.60%
Debt Instrument, Maturity Date		Feb. 28, 2027
4.65% notes due October 2044 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 871	870
Debt Instrument, Interest Rate, Stated Percentage		4.65%
Debt Instrument, Maturity Date		Oct. 31, 2044
Credit Facility
Debt Instrument [Line Items]
Long-term Debt		$ 799	549
4.8% notes due September 2042 [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 493	493
Debt Instrument, Interest Rate, Stated Percentage		4.80%
Debt Instrument, Maturity Date		Sep. 30, 2042
Commercial Paper [Member]
Debt Instrument [Line Items]
Commercial Paper		$ 200	280
Capital Lease Obligations [Member]
Debt Instrument [Line Items]
Long-term Debt		$ 9	$ 3

[1] The carrying value of the euro-denominated 1.50% notes due May 2023 and 1.875% notes due November 2026 will fluctuate with changes in the euro exchange rate. The carrying value of these euro-denominated borrowings have been designated as non-derivative net investment hedges of a portion of the Company's net investments in euro functional-currency denominated subsidiaries to offset foreign currency fluctuations. During the six months ended June 30, 2017 and 2016, pre-tax losses of $109 million and gains of $3 million, respectively, were recognized in "Other comprehensive income (loss)" ("OCI") for revaluation of these notes.

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BORROWINGS Part 2 (Details) Credit Facility and Commercial Paper Borrowings - USD ($) $ in Millions		6 Months Ended	12 Months Ended
	Dec. 05, 2014	Jun. 30, 2017	Dec. 31, 2016
2019 Term Loan [Member]
Credit Facilities [Abstract]
Credit Facility, Borrowing Capacity	$ 1,000
Debt Instrument, Term	5 years
Line of Credit Facility, Maximum Month-end Outstanding Amount		$ 250	$ 250
Line of Credit Facility, Interest Rate During Period		2.48%	2.02%
2021 Term Loan [Member]
Credit Facilities [Abstract]
Credit Facility, Borrowing Capacity			$ 300
Debt Instrument, Term			5 years
Line of Credit Facility, Maximum Month-end Outstanding Amount		$ 299	$ 299
Line of Credit Facility, Interest Rate During Period		2.48%	1.95%
Revolving Credit Facility [Member]
Credit Facilities [Abstract]
Credit Facility, Borrowing Capacity		$ 1,250
Line of Credit Facility, Maximum Month-end Outstanding Amount		$ 0	$ 0
Line of Credit Facility, Expiration Date		Oct. 31, 2021
A/R Facility [Member]
Credit Facilities [Abstract]
Credit Facility, Borrowing Capacity		$ 250
Line of Credit Facility, Maximum Month-end Outstanding Amount		$ 250	0
Line of Credit Facility, Interest Rate During Period		1.98%
Line of Credit Facility, Expiration Date		Apr. 30, 2019
Commercial Paper [Member]
Credit Facilities [Abstract]
Commercial Paper		$ 200	$ 280
Debt, Weighted Average Interest Rate		1.44%	1.12%
Fair Value, Measurements, Recurring [Member]
Line of Credit Facility [Line Items]
Long-term Borrowings, Fair Value		$ 7,069	$ 6,586
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Line of Credit Facility [Line Items]
Long-term Borrowings, Fair Value		$ 796	$ 550

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BORROWINGS Part 3 (Details) Fair Value - USD ($) $ in Millions	Jun. 30, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term borrowings	$ 6,669	$ 6,311
Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term Borrowings, Fair Value	7,069	6,586
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term Borrowings, Fair Value	6,273	6,036
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term Borrowings, Fair Value	796	550
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term Borrowings, Fair Value	$ 0	$ 0

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DERIVATIVE AND NON-DERIVATIVE FINANCIAL INSTRUMENTS Part 1 (Details) - Designated as Hedging Instrument [Member] € in Millions, ¥ in Millions, bbl in Millions, MMBTU in Millions, $ in Millions	6 Months Ended		12 Months Ended
	Jun. 30, 2017 USD ($)	Jun. 30, 2017 EUR (€)	Dec. 31, 2016 USD ($)	Dec. 31, 2016 EUR (€)	Jun. 30, 2017 JPY (¥) bbl MMBTU	Jun. 30, 2017 USD ($) bbl MMBTU	Jun. 30, 2017 EUR (€) bbl MMBTU	Dec. 31, 2016 JPY (¥) bbl MMBTU	Dec. 31, 2016 USD ($) bbl MMBTU	Dec. 31, 2016 EUR (€) bbl MMBTU	Nov. 21, 2016 USD ($)	Nov. 21, 2016 EUR (€)	May 26, 2016 USD ($)	May 26, 2016 EUR (€)
Foreign Exchange Contract [Member] | Euro Member Countries, Euro | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative, Notional Amount						$ 411	€ 360		$ 398	€ 378
Foreign Exchange Contract [Member] | Japan, Yen | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative, Notional Amount					¥ 900	$ 8		¥ 1,800	$ 15
Commodity Contract [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount | bbl					10	10	10	11	11	11
Energy Related Derivative [Member] | Cash Flow Hedging [Member]
Derivative [Line Items]
Derivative, Nonmonetary Notional Amount | MMBTU					20	20	20	23	23	23
Interest Rate Contract [Member] | Fair Value Hedging [Member]
Derivative [Line Items]
Derivative, Notional Amount | $						$ 75			$ 75
1.5% notes due May 2023 [Member] | Euro Member Countries, Euro | Net Investment Hedging [Member]
Derivative [Line Items]
Debt Instrument, Face Amount											$ 213	€ 200	$ 614	€ 550
1.875% notes due 2026 [Member] | Euro Member Countries, Euro | Net Investment Hedging [Member]
Derivative [Line Items]
Debt Instrument, Face Amount											$ 534	€ 500
1.50% Notes Due 2023 and 1.875% Notes Due 2026 [Member] | Euro Member Countries, Euro | Net Investment Hedging [Member]
Derivative [Line Items]
Notional Amount of Nonderivative Instruments	$ 1,400	€ 1,239	$ 1,300	€ 1,238

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DERIVATIVE AND NON-DERIVATIVE FINANCIAL INSTRUMENTS Part 2 (Details) € in Millions	6 Months Ended		12 Months Ended
	Jun. 30, 2017 USD ($)	Jun. 30, 2017 EUR (€)	Dec. 31, 2016 USD ($)	Dec. 31, 2016 EUR (€)	Mar. 31, 2017 USD ($)
Derivative Liabilities [Abstract]
Fair Value Level Transfers			$ 0		$ 0
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Derivative Assets [Abstract]
Derivative Asset, Fair Value, Gross Asset			0		0
Derivative Liabilities [Abstract]
Derivative Liability, Fair Value, Gross Liability			0		0
Derivative, Fair Value, Net			0		0
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member]
Derivative Assets [Abstract]
Derivative Asset, Fair Value, Gross Asset	$ 53,000,000		104,000,000
Derivative Liabilities [Abstract]
Derivative Liability, Fair Value, Gross Liability	138,000,000		135,000,000
Derivative, Fair Value, Net	85,000,000		31,000,000
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Commodity Contract [Member] | Designated as Hedging Instrument [Member] | Other Current Assets [Member]
Derivative Assets [Abstract]
Cash Flow Hedge Derivative Instrument Assets at Fair Value	1,000,000		5,000,000
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Commodity Contract [Member] | Designated as Hedging Instrument [Member] | Other Noncurrent Assets [Member]
Derivative Assets [Abstract]
Cash Flow Hedge Derivative Instrument Assets at Fair Value	0		2,000,000
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Commodity Contract [Member] | Designated as Hedging Instrument [Member] | Other Current Liabilities [Member]
Derivative Liabilities [Abstract]
Cash Flow Hedge Derivative Instrument Liabilities at Fair Value	75,000,000		62,000,000
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Commodity Contract [Member] | Designated as Hedging Instrument [Member] | Other Noncurrent Liabilities [Member]
Derivative Liabilities [Abstract]
Cash Flow Hedge Derivative Instrument Liabilities at Fair Value	58,000,000		69,000,000
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Current Assets [Member]
Derivative Assets [Abstract]
Cash Flow Hedge Derivative Instrument Assets at Fair Value	35,000,000		49,000,000
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Noncurrent Assets [Member]
Derivative Assets [Abstract]
Cash Flow Hedge Derivative Instrument Assets at Fair Value	16,000,000		47,000,000
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Current Liabilities [Member]
Derivative Assets [Abstract]
Cash Flow Hedge Derivative Instrument Assets at Fair Value	1,000,000		0
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Foreign Exchange Contract [Member] | Designated as Hedging Instrument [Member] | Other Noncurrent Liabilities [Member]
Derivative Assets [Abstract]
Cash Flow Hedge Derivative Instrument Assets at Fair Value	1,000,000		0
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Interest Rate Contract [Member] | Designated as Hedging Instrument [Member] | Other Current Assets [Member]
Derivative Assets [Abstract]
Fair Value Hedge Assets	1,000,000		1,000,000
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Interest Rate Contract [Member] | Designated as Hedging Instrument [Member] | Long-term Debt [Member]
Derivative Liabilities [Abstract]
Fair Value Hedge Liabilities	3,000,000		4,000,000
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member]
Derivative Assets [Abstract]
Derivative Asset, Fair Value, Gross Asset			0		0
Derivative Liabilities [Abstract]
Derivative Liability, Fair Value, Gross Liability			0		0
Derivative, Fair Value, Net			0		$ 0
Net Investment Hedging [Member] | Euro Member Countries, Euro | 1.50% Notes Due 2023 and 1.875% Notes Due 2026 [Member] | Designated as Hedging Instrument [Member]
Non-Derivatives, Carrying Value [Abstract]
Notional Amount of Nonderivative Instruments	$ 1,400,000,000	€ 1,239	$ 1,300,000,000	€ 1,238

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DERIVATIVE AND NON-DERIVATIVE FINANCIAL INSTRUMENTS Part 3 (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Amount After Tax of Gain (Loss) Recognized in Other Comprehensive Income On Derivatives, Effective Portion [Abstract]
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax			$ (35)		$ 172
Other Comprehensive Income (Loss), Non-derivatives Qualifying as Hedges, before Tax [Abstract]
Change in cumulative translation adjustment, before tax	$ 36	$ (70)	43	$ 36
Summary of Derivative Instruments [Abstract]
Monetized positions and mark to market in accumulated other comprehensive income before tax	223	57	223	57
Price Risk Cash Flow Hedge Unrealized Loss to be Reclassified During Next 12 Months	43		43
Commodity Contract [Member] | Cash Flow Hedging [Member]
Amount After Tax of Gain (Loss) Recognized in Other Comprehensive Income On Derivatives, Effective Portion [Abstract]
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	9	79	(7)	109
Other Comprehensive Income (Loss), Non-derivatives Qualifying as Hedges, before Tax [Abstract]
Loss on Cash Flow Hedge Ineffectiveness			0	0
Commodity Contract [Member] | Cash Flow Hedging [Member] | Cost of Sales [Member]
Pre-tax Amount of Gain (Loss) reclassified From Accumulated Other Comprehensive Income Into Income (Effective Portion) [Abstract]
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net	(20)	(65)	(27)	(85)
Foreign Exchange Contract [Member] | Cash Flow Hedging [Member]
Amount After Tax of Gain (Loss) Recognized in Other Comprehensive Income On Derivatives, Effective Portion [Abstract]
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	(20)	1	(30)	(25)
Foreign Exchange Contract [Member] | Cash Flow Hedging [Member] | Sales [Member]
Pre-tax Amount of Gain (Loss) reclassified From Accumulated Other Comprehensive Income Into Income (Effective Portion) [Abstract]
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net	10	15	22	30
Interest Rate Swap [Member] | Cash Flow Hedging [Member]
Amount After Tax of Gain (Loss) Recognized in Other Comprehensive Income On Derivatives, Effective Portion [Abstract]
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax	1	(9)	2	(27)
Interest Rate Swap [Member] | Cash Flow Hedging [Member] | Net Interest Expense
Pre-tax Amount of Gain (Loss) reclassified From Accumulated Other Comprehensive Income Into Income (Effective Portion) [Abstract]
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net	(1)	(2)	(2)	(4)
Interest Rate Contract [Member] | Fair Value Hedging [Member] | Net Interest Expense
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) on Fair Value Hedges Recognized in Earnings	1	3	2	7
Foreign Exchange [Member] | Net Investment Hedging [Member]
Other Comprehensive Income (Loss), Non-derivatives Qualifying as Hedges, before Tax [Abstract]
Change in cumulative translation adjustment, before tax	(91)	3	(109)	3
Not Designated as Hedging Instrument [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net	$ 10	$ 23	$ 4	$ 14

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RETIREMENT PLANS (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
United States Pension Plans of US Entity, Defined Benefit [Member]
Components of net periodic benefit cost [Abstract]
Service cost	$ 9	$ 10	$ 18	$ 20
Interest cost	16	19	33	37
Expected return on assets	(35)	(34)	(70)	(68)
Prior service credit, net	(1)	(1)	(2)	(2)
Net periodic benefit (credit) cost	(11)	(6)	(21)	(13)
Foreign Pension Plans, Defined Benefit [Member]
Components of net periodic benefit cost [Abstract]
Service cost	4	3	7	6
Interest cost	4	6	9	12
Expected return on assets	(9)	(8)	(17)	(16)
Prior service credit, net	0	0	0	0
Net periodic benefit (credit) cost	(1)	1	(1)	2
Post Retirement Welfare Plans [Member]
Components of net periodic benefit cost [Abstract]
Service cost	1	1	2	3
Interest cost	6	7	12	14
Expected return on assets	(1)	(1)	(3)	(3)
Prior service credit, net	(10)	(10)	(20)	(20)
Net periodic benefit (credit) cost	$ (4)	$ (3)	$ (9)	$ (6)

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COMMITMENTS (Details) € in Millions, $ in Millions	6 Months Ended
	Jun. 30, 2017 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2017 EUR (€)	Dec. 31, 2016 USD ($)
Other Commitments [Line Items]
Unrecorded Unconditional Purchase Obligation, Purchases	$ 2,900
Unrecorded Unconditional Purchase Obligation, Term	30 years
Leases, Operating [Abstract]
Operating Lease Commitments, Cancelable Noncancelable and Month-to-month	$ 295
Lessee Leasing Arrangements, Operating Leases, Term of Contract	40 years
Guarantees [Abstract]
Operating Lease Residual Value Guarantees	$ 71
Term, other guarantees	P30Y
Maximum potential future payment, other guarantees	$ 35
Transfers and Servicing of Financial Assets [Abstract]
Transfers of Financial Assets Accounted for as Sale, Initial Fair Value of Assets Obtained as Proceeds	$ 171		€ 150
Percent of funding for sold receivables net of deposit	85.00%
Receivable Sold Under Factoring Arrangement	$ 500	$ 460
Continuing Involvement with Derecognized Transferred Financial Assets, Amount Outstanding	$ 122			$ 99
Servicing Assets and Servicing Liabilities at Fair Value, Assumptions Used to Estimate Fair Value, Expected Credit Losses	10.00%
Real Property [Member]
Leases, Operating [Abstract]
Percent of total lease commitments	45.00%		45.00%
Railcars [Member]
Leases, Operating [Abstract]
Percent of total lease commitments	45.00%		45.00%
Machinery and Equipment [Member]
Leases, Operating [Abstract]
Percent of total lease commitments	10.00%		10.00%

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ENVIRONMENTAL MATTERS AND ASSET RETIREMENT OBLIGATIONS (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Site Contingency [Line Items]
Portion Of Environmental Reserve Related To Previously Closed, Impaired, And Divested Sites	$ 8	$ 8
Accrual for Environmental Loss Contingencies [Roll Forward]
Beginning of period	321
End of period	318
Accrual for Environmental Loss Contingencies, Balance Sheet Classification [Abstract]
Accrued Environmental Loss Contingencies, Current	30	30
Accrued Environmental Loss Contingencies, Noncurrent	288	291
Environmental Remediation [Member]
Accrual for Environmental Loss Contingencies [Roll Forward]
Beginning of period	295
Changes in estimates recognized in earnings and other	5
Cash reductions	(9)
End of period	$ 291
Expected Payment Period of Environmental Contingencies	approximately 30 years
Environmental Remediation [Member] | Minimum [Member]
Site Contingency [Line Items]
Loss Contingency, Estimate of Possible Loss	$ 291	295
Environmental Remediation [Member] | Maximum [Member]
Site Contingency [Line Items]
Loss Contingency, Estimate of Possible Loss	500	503
Environmental ARO [Member]
Site Contingency [Line Items]
Best Estimate Accrued to-date For Asset Retirement Obligation	27	26
Non Environmental ARO [Member]
Site Contingency [Line Items]
Best Estimate Accrued to-date For Asset Retirement Obligation	$ 47	$ 46

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STOCKHOLDERS' EQUITY STOCKHOLDERS' EQUITY Part 1 (Details) - USD ($) $ / shares in Units, $ in Millions		3 Months Ended				6 Months Ended			12 Months Ended
		Jun. 30, 2017		Jun. 30, 2016		Jun. 30, 2017		Jun. 30, 2016	Dec. 31, 2016
Stockholders' Equity Note [Abstract]
Dividends, Per Share		$ 0.51		$ 0.46		$ 1.02		$ 0.92
Stockholders' Equity Attributable to Parent		$ 4,812				$ 4,812			$ 4,532
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest		4,890				4,890			4,608
Net earnings attributable to Eastman		292		$ 255		570		$ 506
Net earnings attributable to noncontrolling interest		2		2		3		2
Net earnings including noncontrolling interest		294		257		573		508
Cash dividends declared		(75)		(68)		(149)	[1]	(135)
Other Comprehensive Income		20	[2]	$ (6)	[2]	(5)		$ 79	109
Share-based Compensation Expense	[3]					27
Stock Option Exercises						17
Stockholders' Equity, Other						(6)
Share Repurchases						(175)
Common Stock [Member]
Stockholders' Equity Attributable to Parent		2				2			2
Net earnings attributable to Eastman						0
Cash dividends declared	[1]					0
Other Comprehensive Income						0
Share-based Compensation Expense	[3]					0
Stock Option Exercises						0
Stockholders' Equity, Other						0
Share Repurchases						0
Additional Paid-in Capital [Member]
Stockholders' Equity Attributable to Parent		1,954				1,954			1,915
Net earnings attributable to Eastman						0
Cash dividends declared	[1]					0
Other Comprehensive Income						0
Share-based Compensation Expense	[3]					27
Stock Option Exercises						17
Stockholders' Equity, Other						(5)
Share Repurchases						0
Retained Earnings [Member]
Stockholders' Equity Attributable to Parent		6,142				6,142			5,721
Net earnings attributable to Eastman						570
Cash dividends declared	[1]					(149)
Other Comprehensive Income						0
Share-based Compensation Expense	[3]					0
Stock Option Exercises						0
Stockholders' Equity, Other						0
Share Repurchases						0
Accumulated Other Comprehensive Income (Loss) [Member]
Stockholders' Equity Attributable to Parent		(286)				(286)			(281)
Net earnings attributable to Eastman						0
Cash dividends declared	[1]					0
Other Comprehensive Income						(5)
Share-based Compensation Expense	[3]					0
Stock Option Exercises						0
Stockholders' Equity, Other						0
Share Repurchases						0
Treasury Stock [Member]
Stockholders' Equity Attributable to Parent		(3,000)				(3,000)			(2,825)
Net earnings attributable to Eastman						0
Cash dividends declared	[1]					0
Other Comprehensive Income						0
Share-based Compensation Expense	[3]					0
Stock Option Exercises						0
Stockholders' Equity, Other						0
Share Repurchases						(175)
Parent [Member]
Stockholders' Equity Attributable to Parent		4,812				4,812			4,532
Net earnings attributable to Eastman						570
Cash dividends declared	[1]					(149)
Other Comprehensive Income						(5)
Share-based Compensation Expense	[3]					27
Stock Option Exercises						17
Stockholders' Equity, Other						(5)
Share Repurchases						(175)
Noncontrolling Interest [Member]
Stockholders' Equity Attributable to Parent		$ 78				78			$ 76
Net earnings attributable to noncontrolling interest						3
Cash dividends declared	[1]					0
Other Comprehensive Income						0
Share-based Compensation Expense	[3]					0
Stock Option Exercises						0
Stockholders' Equity, Other						(1)
Share Repurchases						$ 0

[1] Cash dividends declared includes cash dividends paid and dividends declared, but unpaid.

[2] For additional information regarding the impact of reclassifications into earnings, see Note 6, "Derivative and Non-Derivative Financial Instruments".

[3] Share-based compensation expense is the fair value of share-based awards.

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STOCKHOLDERS' EQUITY STOCKHOLDERS' EQUITY Part 2 AOCI (Details) - USD ($) $ in Millions	3 Months Ended				6 Months Ended		12 Months Ended
	Jun. 30, 2017		Jun. 30, 2016		Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016	Dec. 31, 2015
Accumulated Other Comprehensive Income (Loss) [Line Items]
Cumulative Translation Adjustment	$ (338)				$ (338)		$ (381)	$ (284)
Change in cumulative translation adjustment	36		$ (70)		43	$ 36	(97)
Benefit Plans Unrecognized Prior Service Credits	150				150		163	129
Change in Benefit Plans Unrecognized Prior Service Credits					(13)		34
Unrealized Gains (Losses) on Derivative Instruments	(97)				(97)		(62)	(234)
Change in Unrealized Gains (Losses) on Derivative Instruments					(35)		172
Unrealized Losses on Investments	(1)				(1)		(1)	(1)
Change in Unrealized Losses on Investments					0		0
Accumulated Other Comprehensive Income (Loss), Net of Tax	(286)				(286)		(281)	$ (390)
Total other comprehensive income (loss), net of tax	$ 20	[1]	$ (6)	[1]	$ (5)	$ 79	$ 109

[1] For additional information regarding the impact of reclassifications into earnings, see Note 6, "Derivative and Non-Derivative Financial Instruments".

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STOCKHOLDERS' EQUITY STOCKHOLDERS' EQUITY Part 3 OCI (Details) - USD ($) $ in Millions		3 Months Ended				6 Months Ended		12 Months Ended
		Jun. 30, 2017		Jun. 30, 2016		Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Other Comprehensive Income (Loss), before Tax [Abstract]
Change in cumulative translation adjustment, before tax		$ 36		$ (70)		$ 43	$ 36
Amortization of unrecognized prior service credits included in net periodic costs, before tax	[1]	(11)		(11)		(22)	(22)
Unrealized gain (loss), before tax	[2]	(28)		62		(62)	32
Reclassification adjustment for (gain) loss included in net income, before tax	[2]	13		53		7	60
Total other comprehensive income (loss), before tax		10	[2]	34	[2]	(34)	106
Other Comprehensive Income (Loss), Net of Tax [Abstract]
Change in cumulative translation adjustment		36		(70)		43	36	$ (97)
Amortization of unrecognized prior service credits included in net periodic costs	[1]	(6)		(7)		(13)	(14)
Unrealized gain (loss)	[2]	(18)		38		(39)	20
Reclassification adjustment for losses included in net income, net	[2]	8		33		4	37
Total other comprehensive income (loss), net of tax		$ 20	[2]	$ (6)	[2]	(5)	$ 79	109
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, Net of Tax						$ 13		$ (34)

[1] Included in the calculation of net periodic benefit costs for pension and other postretirement benefit plans. See Note 7, "Retirement Plans".

[2] For additional information regarding the impact of reclassifications into earnings, see Note 6, "Derivative and Non-Derivative Financial Instruments".

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EARNINGS AND DIVIDENDS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Earnings Per Share [Abstract]
Earnings, net of tax	$ 292	$ 255	$ 570	$ 506
Weighted average shares used for basic EPS (in shares)	145,300,000	147,800,000	145,700,000	147,800,000
Dilutive effect of stock options and other awards	1,100,000	1,100,000	1,100,000	1,100,000
Weighted average shares used for diluted EPS (in shares)	146,400,000	148,900,000	146,800,000	148,900,000
Earnings per share, basic	$ 2.01	$ 1.73	$ 3.91	$ 3.43
Earnings per share, diluted	$ 2.00	$ 1.71	$ 3.89	$ 3.40
Underlying options excluded from the computation of diluted earnings per share (in shares)	850,970	1,056,961	1,008,667	1,076,935
Shares repurchased (in shares)	1,232,977	344,790	2,176,676	632,071
Cash dividends declared (per share)	$ 0.51	$ 0.46	$ 1.02	$ 0.92

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ASSETS IMPAIRMENTS AND RESTRUCTURING (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Restructuring Cost and Reserve [Line Items]
Restructuring, Settlement and Impairment Provisions	$ 0	$ 0	$ 0	$ (2)
Restructuring Charge [Roll Forward]
Balance at Beginning of Period			55	66	$ 66
Provision / Adjustments			0		45
Restructuring Reserve, Accrual Adjustment			1
Non-cash Reductions					(8)
Cash Reductions			(24)		(48)
Balance at End of Period	32		32		55
Facility Closing [Member]
Restructuring Charge [Roll Forward]
Balance at Beginning of Period			13	11	11
Provision / Adjustments			0		1
Restructuring Reserve, Accrual Adjustment			1		4
Cash Reductions			(2)		(3)
Balance at End of Period	12		12		13
Employee Severance [Member]
Restructuring Charge [Roll Forward]
Balance at Beginning of Period			42	55	55
Provision / Adjustments			0		32
Restructuring Reserve, Accrual Adjustment			0		0
Cash Reductions			(22)		(45)
Balance at End of Period	$ 20		20		42
Non-Cash Charges [Member]
Restructuring Charge [Roll Forward]
Balance at Beginning of Period			$ 0	0	0
Provision / Adjustments					12
Non-cash Reductions					(12)
Cash Reductions					0
Balance at End of Period					$ 0
Crystex R&D facility in France [Member] | Additives And Functional Products [Member]
Restructuring Charge [Roll Forward]
Gain (Loss) on Disposition of Assets				$ 2

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SHARE-BASED COMPENSATION AWARDS (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense before tax	$ 13	$ 7	$ 27	$ 20
Share-based compensation net of deferred tax expense	$ 8	$ 4	$ 17	$ 12

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SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Supplemental Cash Flow Information [Abstract]
Other current assets	$ (3)	$ (13)
Other noncurrent assets	7	14
Payables and other current liabilities	(30)	40
Long-term liabilities and equity	0	(30)
Total	$ (26)	$ 11

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SEGMENT INFORMATION (Details) $ in Millions		3 Months Ended		6 Months Ended
		Jun. 30, 2017 USD ($)	Jun. 30, 2016 USD ($)	Jun. 30, 2017 USD ($) Segment	Jun. 30, 2016 USD ($)	Dec. 31, 2016 USD ($)
Segment Reporting Information [Line Items]
Number of Operating Segments | Segment				4
Sales [Abstract]
Sales		$ 2,419	$ 2,297	$ 4,722	$ 4,533
Operating Earnings (loss) [Abstract]
Operating Income (Loss)		420	376	817	775
Segment Reporting Information, Additional Information [Abstract]
Assets by Segment	[1]	15,964		15,964		$ 15,457
Operating Segments [Member]
Sales [Abstract]
Sales		2,405	2,283	4,695	4,509
Operating Earnings (loss) [Abstract]
Operating Income (Loss)		434	387	841	801
Segment Reporting Information, Additional Information [Abstract]
Assets by Segment	[1]	14,826		14,826		14,349
Corporate, Non-Segment [Member]
Sales [Abstract]
Sales		14	14	27	24
Segment Reporting Information, Additional Information [Abstract]
Assets by Segment	[1]	1,138		1,138		1,108
Growth Initiatives and Businesses not Allocated to Segments [Member] | Corporate, Non-Segment [Member]
Operating Earnings (loss) [Abstract]
Operating Income (Loss)		(32)	(24)	(60)	(42)
Pension and OPEB Costs Not Allocated to Operating Segments [Member] | Corporate, Non-Segment [Member]
Operating Earnings (loss) [Abstract]
Operating Income (Loss)		18	13	36	25
Acquisition integration and transaction costs [Member] | Corporate, Non-Segment [Member]
Operating Earnings (loss) [Abstract]
Operating Income (Loss)		0	0	0	(9)
Additives And Functional Products [Member] | Operating Segments [Member]
Sales [Abstract]
Sales		830	770	1,603	1,507
Operating Earnings (loss) [Abstract]
Operating Income (Loss)		159	168	311	321
Segment Reporting Information, Additional Information [Abstract]
Assets by Segment	[1]	6,497		6,497		6,255
Advanced Materials [Member] | Operating Segments [Member]
Sales [Abstract]
Sales		657	646	1,291	1,235
Operating Earnings (loss) [Abstract]
Operating Income (Loss)		137	132	258	240
Segment Reporting Information, Additional Information [Abstract]
Assets by Segment	[1]	4,382		4,382		4,247
Chemical Intermediates [Member] | Operating Segments [Member]
Sales [Abstract]
Sales		703	633	1,373	1,253
Operating Earnings (loss) [Abstract]
Operating Income (Loss)		83	15	165	82
Segment Reporting Information, Additional Information [Abstract]
Assets by Segment	[1]	2,997		2,997		2,927
Fibers [Member] | Operating Segments [Member]
Sales [Abstract]
Sales		215	234	428	514
Operating Earnings (loss) [Abstract]
Operating Income (Loss)		55	$ 72	107	$ 158
Segment Reporting Information, Additional Information [Abstract]
Assets by Segment	[1]	$ 950		$ 950		$ 920

[1] Segment assets include accounts receivable, inventory, fixed assets, goodwill, and intangible assets. Segment asset balances for shared fixed assets within the CI and Fibers segments as of December 31, 2016 have been reclassified to conform to current period allocation methodology.