Stock Compensation

6 Months Ended

Jun. 29, 2013

Stock Compensation [Abstract]

Stock Compensation [Text Block]

Note 6 Stock compensation

The Company uses various equity-based compensation programs to provide long-term performance incentives for its global workforce. Currently, these incentives consist principally of stock options, and to a lesser extent, executive performance shares, restricted stock units and restricted stock grants. The Company also sponsors a discounted stock purchase plan in the United States and matching-grant programs in several international locations. Additionally, the Company awards restricted stock to its outside directors. The interim information below should be read in conjunction with the disclosures included within the stock compensation footnote of the Company's 2012 Annual Report on Form 10-K.

The Company classifies pre-tax stock compensation expense in SGA expense principally within its corporate operations. For the periods presented, compensation expense for all types of equity-based programs and the related income tax benefit recognized were as follows:

		Quarter ended				Year-to-date period ended
(millions)		June 29, 2013		June 30, 2012		June 29, 2013		June 30, 2012
Pre-tax compensation expense	$	12	$	10	$	21	$	22
Related income tax benefit	$	5	$	4	$	8	$	8

As of June 29, 2013, total stock-based compensation cost related to non-vested awards not yet recognized was $64million and the weighted-average period over which this amount is expected to be recognized was 2 years.

Stock options

During the year-to-date period ended June 29, 2013 and June 30, 2012, the Company granted non-qualified stock options to eligible employees as presented in the following activity tables. Terms of these grants and the Company's methods for determining grant-date fair value of the awards were consistent with that described within the stock compensation footnote in the Company's 2012 Annual Report on Form 10-K.

Year-to-date period ended June 29, 2013:
				Weighted-
			Weighted-	average		Aggregate
			average	remaining		intrinsic
	Shares		exercise	contractual		value
Employee and director stock options	(millions)		price	term (yrs.)		(millions)
Outstanding, beginning of period	25	$	50
Granted	6		60
Exercised	(9)		48
Forfeitures and expirations	(1)		54
Outstanding, end of period	21	$	53	7.4	$	231
Exercisable, end of period	10	$	50	5.8	$	150

Year-to-date period ended June 30, 2012:
				Weighted-
			Weighted-	average		Aggregate
			average	remaining		intrinsic
	Shares		exercise	contractual		value
Employee and director stock options	(millions)		price	term (yrs.)		(millions)
Outstanding, beginning of period	24	$	48
Granted	6		53
Exercised	(1)		42
Forfeitures and expirations	(1)		53
Outstanding, end of period	28	$	49	6.6	$	58
Exercisable, end of period	18	$	47	5.3	$	58

The weighted-average fair value of options granted was $5.92per share and $5.23 per share for the year-to-date periods ended June 29, 2013 and June 30, 2012, respectively. The fair value was estimated using the following assumptions:

	Weighted-average expected volatility	Weighted-average expected term (years)	Weighted-average risk-free interest rate	Dividend yield
Grants within the year-to-date period ended June 29, 2013:	15%	7.44	1.49%	2.90%
Grants within the year-to-date period ended June 30, 2012:	16%	7.53	1.60%	3.30%

The total intrinsic value of options exercised was $117 millionand $13 million for the year-to-date periods ended June 29, 2013 and June 30, 2012, respectively.

Performance shares

In the first quarter of 2013, the Company granted performance shares to a limited number of senior executive-level employees, which entitle these employees to receive a specified number of shares of the Company's common stock on the vesting date, provided cumulative three-year operating profit and internal net sales growth targets are achieved.

The 2013 target grant currently corresponds to approximately 228,000 shares, with a grant-date fair value of $54 per share. The actual number of shares issued on the vesting date could range from 0 to 200% of target, depending on actual performance achieved. Based on the market price of the Company's common stock at June 29, 2013, the maximum future value that could be awarded to employees on the vesting date for all outstanding performance share awards was as follows:

(millions)		June 29, 2013
2011 Award	$	15
2012 Award	$	26
2013 Award	$	29
The 2010 performance share award, payable in stock, was settled at 40% of target in February 2013 for a total dollar
equivalent of $4 million.