Item 9A. CONTROLS AND PROCEDURES

Material Weaknesses in Internal Control Over Financial Reporting

The management of Stanley Black & Decker, Inc. (the "Company") is responsible for establishing and maintaining adequate internal control over financial reporting, as that term is defined under Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Under the supervision and with the participation of management, including the Chief Executive Officer and the President and Chief Financial Officer, the Company has assessed the effectiveness of its internal control over financial reporting as of the end of the period covered by this report based upon the criteria set forth by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission in Internal Control — Integrated Framework (2013 Framework). Based on that assessment, the Chief Executive Officer and the President and Chief Financial Officer concluded that the Company's internal control over financial reporting was not effective to provide reasonable assurance regarding the reliability of its financial reporting and the preparation of its financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America as of January 2, 2021 due to the material weaknesses in internal control described below.

A material weakness, as defined in Rule 12b-2 under the Exchange Act, is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis.

As discussed in the Explanatory Note to this Annual Report on Form 10-K/A and Note A, Significant Accounting Policies - Restatement, of the Notes to Consolidated Financial Statements in Item 8, the Company determined that errors were made in its original accounting conclusions related to equity units issued in May 2017 and November 2019 (the “Equity Units”). The Company determined the errors were the result of the following deficiencies in internal control over financial reporting:

1.The design of its control to consider all the relevant authoritative accounting guidance for financial instruments with debt- and equity-like features; and

2.The design of its control to consider financial instruments with debt- and equity-like features in the calculation of earnings per share.

The Company assessed whether there was a reasonable possibility that a material misstatement would not have been prevented or detected on a timely basis as a result of the above control deficiencies. The first control deficiency could result in a determination that there are two units of account in which the forward stock purchase contracts, when evaluated separately as freestanding instruments, would be precluded from equity classification. As a result, the asset or liability related to the forward stock purchase contracts would be subject to mark-to-market accounting, which would be significantly influenced by factors outside of the Company’s control, including fluctuations in its share price. The second control deficiency resulted in material errors in the calculation of diluted earnings per share previously disclosed in the Company’s historical financial statements. Based on these factors, the Company concluded that the deficiencies noted above each rise to the level of a material weakness.

Remediation of Material Weaknesses

The Company acknowledges that its management is responsible for establishing and maintaining adequate internal control over financial reporting and assessing the effectiveness of its internal controls. The Company is committed to maintaining a strong internal control environment and implementing measures to ensure that the control deficiencies identified above are remediated as soon as possible. Management is in the process of implementing its remediation plan, which includes steps to design and implement new controls and expand education and training related to the accounting considerations for complex financing transactions. The Company will consider the material weakness remediated after the applicable controls operate for a sufficient period of time, and management has concluded, through testing, that the controls are operating effectively.

Evaluation of Disclosure Controls and Procedures

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with accounting principles generally accepted in the United States of America. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

As required by Rules 13a-15(b) of the Exchange Act, the Company’s management assessed the effectiveness of its internal control over financial reporting as of January 2, 2021 based upon the criteria set forth by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission in Internal Control — Integrated Framework (2013 Framework). Based upon its original evaluation, as previously disclosed in its Annual Report on Form 10-K for the fiscal year ended January 2, 2021 filed with the Securities and Exchange Commission ("SEC") on February 18, 2021, the Company's President and Chief Executive Officer and its Executive Vice President and Chief Financial Officer concluded that its disclosure controls and procedures were effective as of January 2, 2021. Subsequently, and as a result of the material weaknesses identified in internal control over financial reporting, the Company's Chief Executive Officer and its President and Chief Financial Officer have concluded that its disclosure controls and procedures were not effective as of January 2, 2021 to ensure that information required to be disclosed by the Company in reports filed or submitted under the Exchange Act is reported accurately.

In February 2020, the Company acquired Consolidated Aerospace Manufacturing, LLC ("CAM") for approximately $1.4 billion. Since Stanley Black & Decker, Inc. had not yet fully incorporated the internal controls and procedures of CAM into Stanley Black & Decker, Inc.'s internal control over financial reporting, management excluded this business from its assessment of the effectiveness of internal control over financial reporting as of January 2, 2021. CAM accounted for 6% of Stanley Black & Decker, Inc.'s total assets as of January 2, 2021 and 2% of Stanley Black & Decker, Inc.'s net sales for the year then ended.

Other than those items noted above, there has been no change in the Company’s internal control over financial reporting that occurred during the fiscal year ended January 2, 2021 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

Refer to Management’s Report On Internal Control Over Financial Reporting on page 66.