What changed in this filing

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Item 1. Financial Statements

2024-05-03 compared with 2023-11-03 · 319 added, 484 removed, 535 unchanged (60% of the section changed)

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AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

in millions, except per share amounts)

Three months ended Nine months ended

September 30,

2023 October 1,

2022 September 30,

2023 October 1,

Three months ended

2024 April 1,

Revenues $ 465.2 $ 399.8

4 unchanged sentences

Special charges, net 0.6 —

Other operating expense, net — — — 1.0

Operating income 64.6 49.8

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Interest income 0.3 0.5

Loss on amendment/refinancing of senior credit agreement — ( 1.1 ) — ( 1.1 )

Income from continuing operations before income taxes 51.1 50.4

Income tax (provision) benefit ( 12.4 ) 2.5 ( 31.5 ) ( 4.5 )

Income tax provision ( 1.9 ) ( 11.3 )

Income from continuing operations 49.2 39.1

Income (loss) from discontinued operations, net of tax — —

Loss on disposition of discontinued operations, net of tax ( 56.1 ) ( 9.4 ) ( 54.7 ) ( 17.1 )

Loss from discontinued operations, net of tax ( 56.1 ) ( 9.4 ) ( 54.7 ) ( 17.1 )

Net income (loss) $ ( 20.4 ) $ 3.1 $ 58.4 $ 27.5

Basic income (loss) per share of common stock:

Gain (loss) on disposition of discontinued operations, net of tax ( 0.2 ) 3.7

Income (loss) from discontinued operations, net of tax ( 0.2 ) 3.7

Net income $ 49.0 $ 42.8

Basic income per share of common stock:

Income from continuing operations $ 1.07 $ 0.86

Loss from discontinued operations, net of tax ( 1.23 ) ( 0.21 ) ( 1.21 ) ( 0.38 )

Net income (loss) per share $ ( 0.45 ) $ 0.07 $ 1.28 $ 0.60

Income from discontinued operations — 0.08

Net income per share $ 1.07 $ 0.94

Weighted-average number of common shares outstanding — basic 45.828 45.382

Diluted income (loss) per share of common stock:

Diluted income per share of common stock:

Income from continuing operations $ 1.05 $ 0.84

Loss from discontinued operations, net of tax ( 1.20 ) ( 0.20 ) ( 1.18 ) ( 0.37 )

Net income (loss) per share $ ( 0.44 ) $ 0.07 $ 1.25 $ 0.59

Income from discontinued operations — 0.08

Net income per share $ 1.05 $ 0.92

Weighted-average number of common shares outstanding — diluted 46.683 46.402

Comprehensive income (loss) $ ( 32.2 ) $ ( 13.7 ) $ 51.6 $ 0.8

Comprehensive income $ 38.8 $ 44.6

The accompanying notes are an integral part of these statements.

3 unchanged sentences

in millions, except share data)

September 30,

2024 December 31,

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Deferred income taxes 4.0 4.0

Assets of DBT and Heat Transfer (includes cash and equivalents of $ 1.1 and $ 9.3 at September 30, 2023 and December 31, 2022, respectively) (Note 3)

Assets of DBT and Heat Transfer (includes cash and equivalents of $ 5.0 and $ 5.5 at March 30, 2024 and December 31, 2023, respectively) (Note 3)

TOTAL ASSETS $ 2,799.6 $ 2,439.7

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Stockholders' Equity:

Common stock ( 53,581,770 and 45,634,180 issued and outstanding at September 30, 2023, respectively, and 53,350,918 and 45,291,989 issued and outstanding at December 31, 2022, respectively)

Common stock ( 54,056,016 and 46,217,007 is sued and outstanding at March 30, 2024, respectively, and 53,618,720 and 45,674,572 issued and outstanding at December 31, 2023, respectively)

Paid-in capital 1,351.6 1,353.6

Retained earnings (deficit) 6.8 ( 51.6 )

Retained earnings 87.3 38.3

Accumulated other comprehensive income 250.9 261.1

Common stock in treasury ( 7,947,590 and 8,058,929 shares at September 30, 2023 and December 31, 2022, respectively)

Common stock in treasury ( 7,839,009 and 7,944,148 shares at March 30, 2024 and December 31, 2023, respectively)

( 452.8 ) ( 458.9 )

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CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

Three months ended September 30, 2023

Common Stock Paid-In Capital Retained Earnings Accum.

Other Comprehensive Income Common Stock In Treasury Total Stockholders’ Equity

Balance at July 1, 2023 $ 0.5 $ 1,341.5 $ 27.2 $ 262.5 $ ( 459.1 ) $ 1,172.6

Net loss — — ( 20.4 ) — — ( 20.4 )

Other comprehensive loss, net — — — ( 11.8 ) — ( 11.8 )

Incentive plan activity

— 3.1 — — — 3.1

Long-term incentive compensation expense

— 3.4 — — — 3.4

Balance at September 30, 2023 $ 0.5 $ 1,348.0 $ 6.8 $ 250.7 $ ( 459.1 ) $ 1,146.9

Nine months ended September 30, 2023

Common Stock Paid-In Capital Retained Earnings (Deficit) Accum.

Other Comprehensive Income Common Stock In Treasury Total Stockholders’ Equity

Three months ended March 30, 2024

Stock Paid-In

Capital Retained

Earnings Accum.

Comprehensive

Income Common

Treasury Total

Stockholders’

Balance at December 31, 2023 $ 0.5 $ 1,353.6 $ 38.3 $ 261.1 $ ( 458.9 ) $ 1,194.6

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Restricted stock unit vesting — ( 15.1 ) — — 6.1 ( 9.0 )

Balance at September 30, 2023 $ 0.5 $ 1,348.0 $ 6.8 $ 250.7 $ ( 459.1 ) $ 1,146.9

Three months ended October 1, 2022

Common Stock Paid-In Capital Retained Deficit Accum.

Other Comprehensive Income Common Stock In Treasury Total Stockholders’ Equity

Balance at July 2, 2022 $ 0.5 $ 1,327.3 $ ( 27.4 ) $ 254.0 $ ( 465.8 ) $ 1,088.6

Net income — — 3.1 — — 3.1

Other comprehensive loss, net — — — ( 16.8 ) — ( 16.8 )

Incentive plan activity — 2.7 — — — 2.7

Long-term incentive compensation expense — 2.1 — — — 2.1

Restricted stock unit vesting — ( 0.2 ) — — 0.2 —

Balance at October 1, 2022 $ 0.5 $ 1,331.9 $ ( 24.3 ) $ 237.2 $ ( 465.6 ) $ 1,079.7

Nine months ended October 1, 2022

Balance at March 30, 2024 $ 0.5 $ 1,351.6 $ 87.3 $ 250.9 $ ( 452.8 ) $ 1,237.5

Three months ended April 1, 2023

Common Stock Paid-In Capital Retained Deficit Accum.

2 unchanged sentences

Net income — — 42.8 — — 42.8

Other comprehensive loss, net — — — ( 26.7 ) — ( 26.7 )

Other comprehensive income, net — — — 1.8 — 1.8

Incentive plan activity — 5.2 — — — 5.2

1 unchanged sentence

Restricted stock unit vesting — ( 11.3 ) — — 5.3 ( 6.0 )

Common stock repurchases — — — — ( 33.7 ) ( 33.7 )

Balance at October 1, 2022 $ 0.5 $ 1,331.9 $ ( 24.3 ) $ 237.2 $ ( 465.6 ) $ 1,079.7

Balance at April 1, 2023 $ 0.5 $ 1,335.3 $ ( 8.8 ) $ 259.3 $ ( 460.2 ) $ 1,126.1

The accompanying notes are an integral part of these statements.

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine months ended

September 30,

2023 October 1,

Three months ended

2024 April 1,

Cash flows from (used in) operating activities:

Net income $ 49.0 $ 42.8

Loss from discontinued operations, net of tax ( 54.7 ) ( 17.1 )

Gain (loss) from discontinued operations, net of tax ( 0.2 ) 3.7

Income from continuing operations 49.2 39.1

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Cash spending on restructuring actions ( 0.4 ) —

Net cash from (used in) continuing operations 120.0 ( 89.4 )

Net cash from continuing operations 10.7 0.8

Net cash used in discontinued operations ( 0.2 ) ( 5.2 )

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Proceeds related to company-owned life insurance policies, net 0.1 0.1

Business acquisitions, net of cash acquired ( 547.3 ) ( 40.0 )

Business acquisition, net of cash acquired ( 294.1 ) —

Capital expenditures ( 9.9 ) ( 4.0 )

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Net repayments under other financing arrangements ( 0.3 ) —

Payment of contingent consideration — ( 1.3 )

Minimum withholdings paid on behalf of employees for net share settlements, net of proceeds from the exercise of employee stock options ( 3.0 ) ( 4.1 )

Repurchases of common stock — ( 33.7 )

Financing fees paid ( 1.3 ) ( 1.9 )

Net cash from (used in) continuing operations 425.1 ( 41.2 )

Net cash from continuing operations 292.7 62.9

Net cash from discontinued operations — —

Net cash from (used in) financing activities 425.1 ( 40.2 )

Net cash from financing activities 292.7 62.9

Change in cash and equivalents due to changes in foreign currency exchange rates 1.3 1.0

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Consolidated cash and equivalents, end of period $ 105.5 $ 212.7

Nine months ended

September 30,

2023 October 1,

Three months ended

2024 April 1,

Components of cash and equivalents:

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All of our VIE’s are immaterial, individually and in aggregate, to our condensed consolidated financial statements.

Merger and Consummation of Holding Company Reorganization

As of August 15, 2022, SPX Technologies, Inc.

(the “Company”) is the successor registrant pursuant to Rule 12g-3(a) under the Securities Exchange Act of 1934, as amended, to SPX Corporation (“Legacy SPX”) as a result of the completion on August 15, 2022 of a holding company reorganization (the “Holding Company Reorganization”) effected as a merger of Legacy SPX with and into SPX Merger, LLC, a subsidiary of the Company.

Each share of Legacy SPX’s common stock, par value $ 0.01 per share, issued and outstanding immediately prior to the consummation of the Holding Company Reorganization was automatically converted into an equivalent corresponding share of the Company’s common stock having the same designations, rights, powers and preferences and the qualifications, limitations and restrictions as the corresponding share of Legacy SPX common stock being converted.

Accordingly, upon consummation of the Holding Company Reorganization, Legacy SPX stockholders became stockholders of the Company.

The terms “SPX,” “we” and “our” include Legacy SPX for periods prior to the consummation of the Holding Company Reorganization as the context requires.

Divestiture of Asbestos Liabilities and Certain Assets

On November 1, 2022, we divested three wholly-owned subsidiaries that hold asbestos liabilities and certain assets, including related insurance assets, to Canvas Holdco LLC (“Canvas”), an entity formed by a joint venture of Global Risk Capital LLC and an affiliate of Premia Holdings Ltd.

In connection with the divestiture (the “Asbestos Portfolio Sale”), the divested subsidiaries have agreed to indemnify us and our affiliates for their asbestos-related liabilities, which encompassed all of our consolidated asbestos-related liabilities and contingent liabilities immediately prior to the divestiture.

These indemnification obligations are not subject to any cap or time limitation.

As a result of this transaction, the Company divested all obligations with respect to pending and future asbestos claims relating to these matters.

The board of managers of the divested subsidiaries each received a solvency opinion from an independent advisory firm that the divested subsidiaries were solvent after giving effect to the Asbestos Portfolio Sale.

The agreement for the Asbestos Portfolio Sale contains customary representations and warranties with respect to the divested subsidiaries, the Company, and Canvas.

Pursuant to the agreement, the Company and Canvas will each indemnify the other for breaches of representation and warranties or breaches of covenants, subject to certain limitations as set forth in the agreement.

Refer to Note 15 for additional details.

Acquisition of Cincinnati Fan

On December 15, 2021, we completed the acquisition of Cincinnati Fan & Ventilator Co., Inc.

(“Cincinnati Fan”), a leader in engineered air movement solutions, including blowers and critical exhaust systems.

W e purchased Cincinnati Fan for cash consideration of $ 145.2 , net of (i) cash acquired of $ 2.5 and (ii) an adjustment to the purchase price received during the second quarter of 2022 related to acquired working capital of $ 0.4 .

The post acquisition operating results of Cincinnati Fan are reflected within our HVAC reportable segment.

Acquisition of ITL

On March 31, 2022, we completed the acquisition of International Tower Lighting, LLC ( “ ITL ” ), a leader in the design and manufacture of highly-engineered Aids to Navigation systems, including obstruction lighting for telecommunications towers, wind turbines and numerous other terrestrial obstructions.

We purchased ITL for cash consideration of $ 40.4 , net of (i) cash acquired of $ 1.1 and (ii) an adjustment to the purchase price received during the third quarter of 2022 related to acquired working capital of $ 1.4 .

The post-acquisition operating results of ITL are reflected within our Detection and Measurement reportable segment.

Acquisition of TAMCO

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On June 2, 2023, we completed the acquisition of ASPEQ Heating Group ( “ASPEQ”), a leading provider of electrical heating solutions to customers in industrial and commercial markets.

We purchased ASPEQ for cash consideration of $ 421.8 , net of cash acquired of $ 0.9 .

The purchase price is subject to adjustment based upon the final calculation of working capital and cash as of the date of acquisition.

We purchased ASPEQ for cash consideration of $ 421.5 , net of (i) an adjustment to the purchase price of $ 0.3 received during the fourth quarter of 2023 related to acquired working capital and (ii) cash acquired of $ 0.9 .

The post-acquisition operating results of ASPEQ are reflected within our HVAC reportable segment.

The assets acquired and liabilities assumed in the TAMCO and ASPEQ transactions have been recorded at estimates of fair value as determined by management, based on information available and assumptions as to future operations and are subject to change, primarily for the final assessment and valuation of certain income tax amounts.

Acquisition of Ingénia

On February 7, 2024, we completed the acquisition of Ingénia Technologies Inc.

(“Ingénia”) which specializes in the design and manufacture of custom air handling units that demand high levels of precision and reliability in healthcare, pharmaceutical, education, food processing and industrial end markets.

We purchased Ingénia for cash consideration of $ 294.1 , net of cash acquired of $ 1.5 .

Under the terms of the purchase and sales agreement, the seller is eligible for additional cash consideration of up to Canadian Dollars (“CAD”) 3.0 (or $ 2.2 at the time of acquisition), with payment scheduled to be made in the event certain contingent liabilities do not materialize.

The estimated fair value of such contingent consideration is $ 0.3 , which is reflected as a liability in our condensed consolidated balance sheet as of March 30, 2024.

The post-acquisition results of Ingénia are reflected within our HVAC reportable segment.

The assets acquired and liabilities assumed in the TAMCO, ASPEQ, and Ingénia transactions have been recorded at estimates of fair value as determined by management, based on information available and assumptions as to future operations and are subject to change, primarily for the final assessment and valuation of certain income tax amounts.

Preparing financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses.

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Our fourth quarter ends on December 31.

The interim closing dates for the first, second and third quarters of 2023 are April 1, July 1, and September 30, compared to the respective April 2, July 2, and October 1, 2022 dates.

We had one less day in the first quarter of 2023 and will have one more day in the fourth quarter of 2023 than in the respective 2022 periods.

It is not practicable to estimate the impact of the one less day on our consolidated operating results for the nine months ended September 30, 2023, when compared to the consolidated operating results for the respective 2022 period.

Correction of Prior-Year Classification and Disclosure

During the fourth quarter of 2022, we concluded that, although the assessment of our reportable segments was performed using the appropriate measures as defined by the Segment Reporting Topic of the Accounting Standards Codification (“Codification”), the disclosure of operating income for each of our reportable segments (“Segment Income”) was not consistent with the measure used by our Chief Operating Decision Maker (“CODM”) when evaluating the results of, or allocating resources to, our reportable segments.

We previously disclosed that Segment Income was determined before considering impairments and special charges, long-term incentive compensation, certain other operating income/expense, and other indirect corporate expenses.

Our CODM also excludes the impact of intangible asset amortization, inventory step-up charges, and certain other acquisition-related costs from Segment Income.

Accordingly, Segment Income, as presented in Note 6, now excludes all of the items noted above.

This change had no impact to the amounts previously presented in our condensed consolidated statements of operations for the three and nine months ended October 1, 2022.

Although the impact of this change to previously disclosed Segment Income is not material, we revised the prior-year presentation to be consistent with the current-year disclosure.

The impact of this change on the Segment Income previously presented for the three and nine months ended October 1, 2022 is summarized below:

Three months ended October 1, 2022 Nine months ended October 1, 2022

As Previously Presented Effect of Change Current Presentation As Previously Presented Effect of Change Current Presentation

HVAC reportable segment $ 30.9 $ 2.2 $ 33.1 $ 71.7 $ 10.3 $ 82.0

Detection and Measurement reportable segment 25.7 4.6 30.3 63.2 13.9 77.1

Total income for reportable segments 56.6 6.8 63.4 134.9 24.2 159.1

Corporate expense 17.2 — 17.2 50.2 — 50.2

Acquisition related costs (1)

— 0.1 0.1 — 1.1 1.1

Long-term incentive compensation expense 2.1 — 2.1 7.7 — 7.7

Amortization of intangible assets — 6.7 6.7 — 23.1 23.1

Special charges, net — — — 0.1 — 0.1

Other operating expense, net — — — 1.0 — 1.0

Consolidated operating income $ 37.3 $ — $ 37.3 $ 75.9 $ — $ 75.9

___________________________

(1) Represents additional “Cost of products sold” related to the step-up of inventory (to fair value) acquired in connection with the ITL acquisition of $ 0.1 and $ 1.1 during the three and nine months ended October 1, 2022, respectively.

The interim closing dates for the first, second and third quarters of 2024 are March 30, June 29, and September 28, compared to the respective April 1, July 1, and September 30 dates of 2023.

We had one less day in the first quarter of 2024 and will have two more days in the fourth quarter of 2024 than in the respective 2023 periods.

It is not practicable to estimate the impact of the one less day on our consolidated operating results for the three months ended March 30, 2024, when compared to the consolidated operating results for the 2023 respective period.

(2) NEW ACCOUNTING PRONOUNCEMENTS

The following is a summary of new accounting pronouncements that apply or may apply to our business.

The London Interbank Offered Rate (“LIBOR”) was discontinued on June 30, 2023.

In an effort to address the various challenges created by such discontinuance, the Financial Accounting Standards Board (“FASB”) issued three amendments to existing guidance, Accounting Standards Update (“ASU”) No.

2021-01, and No.

2022-06, Reference Rate Reform.

The amended guidance is designed to provide relief from the accounting analysis and impacts that may otherwise be required for modifications to agreements (e.g., loans, debt securities, derivatives, etc.) necessitated by the reference rate reform.

It also provides optional expedients to enable companies to continue to apply hedge accounting to certain hedging relationships impacted by the reference rate reform.

Application of the guidance in the amendments is optional, is only available in certain situations, and is only available for companies to apply until December 31, 2024.

In conjunction with entering into an amended and restated credit agreement on August 12, 2022, we adopted this guidance with no material impact on our condensed consolidated financial statements.

In November 2023, the FASB issued ASU No.

Among other new disclosure requirements, ASU 2023-07 requires companies to disclose significant segment expenses that are regularly provided to the chief operating decision maker.

ASU 2023-07 will be effective for annual periods beginning on January 1, 2024 and interim periods beginning on January 1, 2025.

ASU 2023-07 must be applied retrospectively to all prior periods presented in the financial statements.

We are currently evaluating the disclosure impact of ASU 2023-07;

however, the standard will not have an impact on the Company’s condensed consolidated financial position, results of operations or cash flows.

In December 2023, the FASB issued ASU No.

2023-09, which requires companies to disclose, on an annual basis, specific categories in the effective tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold.

In addition, ASU 2023-09 requires companies to disclose additional information about income taxes paid.

ASU 2023-09 will be effective for annual periods beginning January 1, 2025 and will be applied on a prospective basis with the option to apply the standard retrospectively.

We are currently evaluating the disclosure impact of ASU 2023-09;

however, the standard will not have an impact on the Company’s condensed consolidated financial position, results of operations or cash flows.

(3) ACQUISITIONS AND DISCONTINUED OPERATIONS

As indicated in Note 1, on April 3, 2023, we completed the acquisition of TAMCO.

The pro forma effect of this acquisition is not material to our condensed consolidated results of operations.

Acquisition of Ingénia

As indicated in Note 1, on February 7, 2024, we completed the acquisition of Ingénia, for $ 294.1 , net of cash acquired of $ 1.5 .

We financed the acquisition with available borrowings on our revolving credit facilities under our senior credit facilities.

The assets acquired and liabilities assumed have been recorded at preliminary estimates of fair value as determined by management, based on information currently available and on current assumptions as to future operations and are subject to change upon completion of the acquisition method of accounting.

Final determination of the fair values of certain assets and liabilities will be completed within the measurement period of up to one year from the acquisition date, as permitted under GAAP.

The excess of the purchase price over the total of the estimated fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed is recognized as goodwill.

In order to determine the fair values of tangible and intangible assets acquired and liabilities assumed for Ingénia, we engaged a third-party independent valuation specialist.

The following is a summary of the recorded preliminary fair values of the assets acquired and liabilities assumed for Ingénia as of February 7, 2024:

Assets acquired:

Current assets, including cash and equivalents of $ 1.5

Property, plant and equipment 72.9

Goodwill 141.2

Intangible assets 97.9

Total assets acquired 344.6

Current liabilities assumed 11.1

Non-current liabilities assumed (1)

Net assets acquired $ 295.6

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(1) Includes net deferred income tax liabilities and other liabilities of $ 37.8 and $ 0.1 , respectively.

The identifiable intangible assets acquired consis t of technology, customer relationships, trademarks, and customer backlog of $ 46.7 , $ 23.5 , $ 13.9 , and $ 13.8 , respectively, with suc h amounts based on a preliminary assessment of the related fair values.

We expect to amortize the technology, customer relationships, trademarks, and customer backlog assets ove r 12.0 , 7.0 , 8.0 , and 1.0 years, respectively.

We acquired gro ss receivables of $ 18.0 , which had the same fair value at the acquisition date based on our estimates of cash flows expected to be recovered.

The qualitative factors that comprise the recorded goodwill include expected market growth for Ingénia's existing operations, increased volumes achieved by selling Ingénia’s products through existing SPX sales channels, procurement and operational savings and efficiencies, and various other factors.

We expect no ne of the goodwill described above to be deductible for tax purposes.

We recognized revenues and net income for Ingénia of $ 12.5 and $ 0.6 , respectively, for the three months ended March 30, 2024 with the net income impacted by charges during the three months ended March 30, 2024 of $ 3.3 associated with amortization of the various intangible assets mentioned above and $ 0.9 associated with the excess fair value (over historical cost) of inventory acquired which was subsequently sold.

Additionally, during the three months ended March 30, 2024, we incurred acquisition-related costs for Ingénia of $ 2.3 , which have been recorded to “Selling, general and administrative” within our condensed consolidated statements of operations and “Corporate expense” within consolidated operating income in Note 6.

Acquisition of ASPEQ

As indicated in Note 1, on June 2, 2023, we completed the acquisition of ASPEQ for $ 421.8 , net of cash acquired of $ 0.9 .

As indicated in Note 1, on June 2, 2023, we completed the acquisition of ASPEQ for $ 421.5 , net of (i) an adjustment to the purchase price of $ 0.3 received during the fourth quarter of 2023 related to acquired working capital and (ii) cash acquired of $ 0.9 .

We financed the acquisition with available cash and borrowings under our senior credit facilities.

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Final determination of the fair values of certain assets and liabilities will be completed within the measurement period of up to one year from the acquisition date, as permitted under GAAP.

The excess of the purchase price over the total of the estimated fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed is recognized as goodwill.

In order to determine the fair values of tangible and intangible assets acquired and liabilities assumed fo r ASPEQ, we engaged a third-party independent valuation specialist.

The following is a summary of the recorded preliminary fair values of the assets acquired and liabilities assumed for ASPEQ as of June 2, 2023:

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The identifiable intangible assets acquired consist of customer relationships, trademarks, technology, and customer backlog of $ 142.3 , $ 51.5 , $ 47.8 , and $ 4.5 , respectively, with such amounts based on a preliminary assessment of the related fair values.

We expect to amortize the customer relationships, technology, and customer backlog assets over 12.0 , 16.0 , and 1.0 years, respectively, with the trademarks acquired being indefinite lived.

We acquired gross receivables of $ 18.0 , which had a fair value at the acquisition date of $ 17.9 based on our estimates of cash flows expected to be recovered.

We expect to amortize the ASPEQ customer relationships, technology, and customer backlog assets over 12.0 , 16.0 , and 1.0 years, respectively, with the trademarks acquired being indefinite-lived.

We acquired gross receivables of $ 18.0 , which had a fair value at the acquisition date of $ 17.9 , respectively, based on our estimates of cash flows expected to be recovered.

The qualitative factors that comprise the recorded goodwill include expected market growth for ASPEQ’s existing operations, increased volumes achieved by selling ASPEQ’s products through existing SPX sales channels, procurement and operational savings and efficiencies, and various other factors.

We expect no ne of the goodwill described above to be deductible for tax purposes.

We recognized revenues and net losses for ASPEQ of $ 26.0 and $ 0.8 , and $ 34.6 and $ 1.3 , respectively, for the three and nine months ended September 30, 2023 with the net loss impacted by charges during the three and nine months ended September 30, 2023 of (i) $ 6.7 and $ 9.4 , respectively, associated with amortization of the various intangible assets mentioned above and (ii) $ 2.5 and $ 3.6 , respectively, associated with the excess fair value (over historical cost) of inventory acquired which has been subsequently sold.

During the nine months ended September 30, 2023, we incurred acquisition-related costs for ASPEQ of $ 5.1 , which have been recorded to “Selling, general and administrative” within our condensed consolidated statements of operations and “Corporate expense” within consolidated operating income in Note 6.

The following unaudited pro forma information presents our results of operations for the three and nine months ended September 30, 2023 and October 1, 2022, respectively, as if the acquisition of ASPEQ had taken place on January 1, 2022.

The unaudited pro forma financial information is not intended to represent or be indicative of our consolidated results of operations that would have been reported had the acquisition been completed as of the date presented, and should not be taken as representative of our future consolidated results of operations.

During the thre e months ended March 30, 2024, we incurred integration-related costs for ASPEQ of $ 0.9 , which have been recorded to “Selling, general and administrative” within our condensed consolidated statements of operations and “Acquisition-related and other costs” within consolidated operating income in Note 6.

The following unaudited pro forma information presents our condensed consolidated results of operations for the three months ended March 30, 2024 and April 1, 2023, respectively, as if the acquisitions of Ingénia and ASPEQ had taken place on January 1, 2023 and January 1, 2022, respectively.

The unaudited pro forma financial information is not intended to represent or be indicative of our condensed consolidated results of operations that would have been reported had the acquisition been completed as of the dates presented, and should not be taken as representative of our future consolidated results of operations.

The pro forma results include estimates and assumptions that management believes are reasonable;

however, these results do not include any anticipated cost savings or expenses of the planned integration of ASPEQ.

These pro forma results of operations have been prepared for comparative purposes only and include additional interest expense on the borrowings required to finance the acquisition, additional depreciation and amortization expense associated with fair value adjustments to the acquired property, plant and equipment and intangible assets, adjustments to reflect charges associated with acquisition-related costs and charges associated with the excess fair value (over historical cost) of inventory acquired and subsequently sold as if they were incurred during the first quarter of 2022, and the related income tax effects.

Three months ended Nine months ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

however, these results do not include any anticipated cost savings or expenses of the planned integration of Ingénia and ASPEQ.

These pro forma consolidated results of operations have been prepared for comparative purposes only and include additional interest expense on the borrowings required to finance the acquisitions, additional depreciation and amortization expense associated with fair value adjustments to the acquired property, plant and equipment and intangible assets, adjustments to reflect charges associated with acquisition-related costs and charges associated with the excess fair value (over historical cost) of inventory acquired and subsequently sold as if they were incurred during the first quarter of 2023 for Ingénia and first quarter of 2022 for ASPEQ, and the related income tax effects.

Three months ended

March 30, 2024 April 1, 2023

Revenues $ 473.2 $ 445.7

Income from continuing operations 50.3 29.7

Net income (loss) ( 16.3 ) ( 0.4 ) 63.9 6.4

Net income 50.1 33.4

Income from continuing operations per share of common stock:

1 unchanged sentence

Diluted $ 1.08 $ 0.64

Net income (loss) per share of common stock:

Net income per share of common stock:

Basic $ 1.09 $ 0.74

Diluted $ 1.07 $ 0.72

Other Acquisitions

As indicated in Note 1, on March 31, 2022 and April 3, 2023, we completed the acquisitions of ITL and TAMCO, respectively.

The pro forma effects of these acquisitions are not material to our condensed consolidated results of operations.

Sale of Transformer Solutions Business

On October 1, 2021, we completed the sale of SPX Transformer Solutions, Inc.

which is reported as a discontinued operation for all periods presented.

During the first quarter of 2022, we agreed to the final adjustment of the purchase price which resulted in a payment to the buyer of $ 13.9 and an increase to the gain on sale of $ 0.2 .

Wind-Down of DBT Business

2 unchanged sentences

As previously disclosed, DBT had asserted claims against the remaining prime contractor on the large projects, Mitsubishi Heavy Industries Power — ZAF (f.k.a.

Mitsubishi-Hitachi Power Systems Africa (PTY) LTD) (“MHI”), of approximately South African Rand 1,000.0 (or $ 52.1 ) and MHI had asserted, or issued letters of intent to claim for, alleged damages against DBT.

Although it was reasonably possible that some loss may have been incurred in connection with these claims (which totaled approximately South African Rand 2,815.2 or $ 146.5 ), we were unable to estimate the potential loss or range of potential loss associated with these claims due to the (i) lack of support provided by MHI for these claims;

(ii) complexity of contractual relationships between the end customer, MHI, and DBT;

(iii) legal interpretation of the contract provisions and application of South African law to the contracts;

and (iv) unpredictable nature of any dispute resolution processes that have occurred or may occur in connection with these claims.

Although we have experienced success in enforcing and defending our rights through the dispute resolution process over the past few years (including the matters mentioned below), we have invested, and would have continued to invest, significant management and financial resources to defend and pursue these matters.

On September 5, 2023, DBT and SPX entered into an agreement with MHI to resolve all claims between the parties with respect to the two large power projects in South Africa (the “Settlement Agreement”).

The Settlement Agreement provides for full and final settlement and mutual release of all claims between the parties with respect to the projects, including any claim

against SPX Technologies, Inc.

Mitsubishi-Hitachi Power Systems Africa (PTY) LTD) (“MHI”), which had also asserted claims against DBT.

As previously disclosed in our 2023 Annual Report on Form 10-K, on September 5, 2023, DBT and SPX entered into an agreement with MHI to resolve all claims between the parties with respect to the two large power projects in South Africa (the “Settlement Agreement”).

The Settlement Agreement provides for full and final settlement and mutual release of all claims between the parties with respect to the projects, including any claim against SPX Technologies, Inc.

as guarantor of DBT's performance on the projects.

It also provides that the underlying subcontracts are terminated and all obligations of both parties under the subcontracts have been satisfied in full.

In connection with the Settlement Agreement, we incurred a charge, net of tax, of $ 54.2 during the three months ended September 30, 2023.

The charge included the write-off of $ 15.2 in net amounts due from MHI.

Such charge is included in “Loss from discontinued operations, net of tax” for the three and nine months ended September 30, 2023.

Prior to the Settlement Agreement, on February 22, 2021, a dispute adjudication panel issued a ruling in favor of DBT against MHI related to costs incurred in connection with delays on two units of the Kusile project.

2 unchanged sentences

In March 2023, an arbitration tribunal upheld the decision of the dispute adjudication panel.

As a result, the South African Rand 126.6 (or $ 6.8 ) was recorded as income during the quarter ended April 1, 2023, with such amount recorded within “Loss on disposition of discontinued operations, net of tax.” Additionally, in June 2023, the arbitration tribunal ruled DBT was entitled to recover $ 1.3 of legal costs incurred related to the arbitration.

Such amount was recorded to “Loss on disposition of discontinued operations, net of tax” during the second quarter of 2023 with the cash payment received during the nine months ended September 30, 2023.

Additionally, in May 2023, a separate arbitration tribunal ruled DBT was entitled to recover $ 5.5 of legal costs incurred related to a prior arbitration hearing.

The assets and liabilities of DBT have been included within “Assets of DBT and Heat Transfer” and “Liabilities of DBT and Heat Transfer,” respectively, on the condensed consolidated balance sheets as of September 30, 2023 and December 31, 2022.

The major line items constituting DBT ’ s assets and liabilities as of September 30, 2023 and December 31, 2022 :

September 30, 2023 December 31, 2022

As a result, South African Rand 126.6 (or $ 7.0 ) was recorded as income during the first quarter of 2023, with such amount recorded within “Gain (loss) on disposition of discontinued operations, net of tax.”

The assets and liabilities of DBT have been included within “ Assets of DBT and Heat Transfer ” and “ Liabilities of DBT and Heat Transfer, ” respectively, on the condensed consolidated balance sheets as of March 30, 2024 and December 31, 2023.

The major line items constituting DBT ’ s assets and liabilities as of March 30, 2024 and December 31, 2023 are shown below:

March 30, 2024 December 31, 2023

Cash and equivalents $ 5.0 $ 5.5

6 unchanged sentences

Property, plant and equipment, net 0.1 0.1

Other assets — 19.1

Total assets of DBT $ 9.1 $ 10.7

Accounts payable (2)

$ 26.1 $ 26.9

Contract liabilities (1)

3 unchanged sentences

___________________________

(1) Includes DBT's remaining obligation under the Settlement Agreement to make a payment to MHI of South African Rand 480.9 (or $ 25.0 at September 30, 2023), due in September 2024.

(1) Recorded amounts relate primarily to disputed amounts due to or from a subcontractor used by DBT during the Kusile project, that is currently in liquidation.

The timing of the ultimate resolution of these matters is uncertain as they are likely to occur as part of the liquidation process.

(2) Includes DBT's remaining obligation under the Settlement Agreement to make a payment to MHI of South African Rand 480.9 (or $ 25.5 and $ 26.2 at March 30, 2024 and December 31, 2023, respectively), due in September 2024.

In connection with this remaining obligation, we entered into a foreign currency forward contract which we are accounting for as a fair value hedge.

3 unchanged sentences

As a result of completing the wind-down plan, we are reporting Heat Transfer as a discontinued operation for all periods presented.

The assets and liabilities of Heat Transfer have been included within “Assets of DBT and Heat Transfer” and “Liabilities of DBT and Heat Transfer,” respectively, on the condensed consolidated balance sheets as of September 30, 2023 and December 31, 2022.

The major line items constituting Heat Transfer’s assets and liabilities as of September 30, 2023 and December 31, 2022 are shown below:

September 30, 2023 December 31, 2022

The assets and liabilities of Heat Transfer have been included within “ Assets of DBT and Heat Transfer ” and “ Liabilities of DBT and Heat Transfer, ” respectively, on the condensed consolidated balance sheets as of March 30, 2024 and December 31, 2023.

The major line items constituting Heat Transfer ’ s assets and liabilities as of March 30, 2024 and December 31, 2023 are shown below:

March 30, 2024 December 31, 2023

Other current assets $ 0.3 $ 0.3

2 unchanged sentences

Accounts payable $ 0.1 $ 0.2

Accrued expenses 0.1 0.1

Total liabilities of Heat Transfer $ 0.1 $ 0.2

Changes in estimates associated with liabilities retained in connection with a business divestiture (e.g., income taxes) may occur.

Changes in estimates associated with liabilities retained in connection with a business divestiture (e.g.

income taxes) may occur.

As a result, it is possible that the resulting gains/losses on these and other previous divestitures may be materially adjusted in subsequent periods.

For the three and nine months ended September 30, 2023 and October 1, 2022, results of operations from our businesses reported as discontinued operations were as follows:

Three months ended Nine months ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Loss from discontinued operations $ ( 69.2 ) $ ( 5.7 ) $ ( 68.6 ) $ ( 14.2 )

For the three months ended March 30, 2024 and April 1, 2023, results of operations from our businesses reported as discontinued operations were as follows:

Three months ended

March 30, 2024 April 1, 2023

Income (loss) from discontinued operations (1)

$ ( 0.2 ) $ 3.0

Income tax benefit 0.2 0.7

Loss from discontinued operations, net ( 56.0 ) ( 4.9 ) ( 54.5 ) ( 11.9 )

All other (2)

Income from discontinued operations, net — 3.7

Loss from discontinued operations (2)

1 unchanged sentence

Loss from discontinued operations, net ( 0.2 ) —

Loss from discontinued operations ( 69.3 ) ( 11.7 ) ( 68.8 ) ( 21.1 )

Income (loss) from discontinued operations ( 0.4 ) 3.0

Income tax benefit 0.2 0.7

Loss from discontinued operations, net $ ( 56.1 ) $ ( 9.4 ) $ ( 54.7 ) $ ( 17.1 )

Income (loss) from discontinued operations, net $ ( 0.2 ) $ 3.7

___________________________

(1) Loss for the three and nine months ended September 30, 2023 resulted primarily from the charge, and related income tax impacts, recorded in connection with the Settlement Agreement referred to above and legal costs incurred in connection with the various dispute resolution matters.

This loss for the nine months ended September 30, 2023 was partially offset by the arbitration awards received, which are discussed above.

Loss for the three and nine months ended October 1, 2022 resulted primarily from net legal costs, and related income tax impacts, incurred in connection with various dispute resolution matters related to the two large power projects.

(2) Loss for the three and nine months ended September 30, 2023 resulted primarily from revisions to liabilities retained in connection with prior dispositions.

Loss for the three and nine months ended October 1, 2022 resulted primarily from asbestos-related charges and revisions to liabilities, including income tax liabilities, retained in connection with prior dispositions.

Net cash used in discontinued operations for the nine months ended September 30, 2023 related primarily to (i) cash payments of $ 25.3 made by DBT to MHI during the three months ended September 30, 2023 in connection with the Settlement Agreement, (ii) disbursements of $ 14.5 for professional fees and support costs incurred principally in connection with the claims resolved by the Settlement Agreement, and (iii) local taxes of $ 3.8 paid in South Africa, which we subsequently recovered during the fourth quarter of 2023, partially offset by recovery of legal costs we were awarded in arbitration

proceedings between DBT and MHI of $ 6.8 mentioned above.

Net cash used in discontinued operations for the nine months ended October 1, 2022 related primarily to (i) disbursements for professional fees incurred in connection with the South Africa claims matters, (ii) disbursements related to asbestos product liability matters, (iii) a payment of $ 13.9 to the buyer of Transformer Solutions related to the settlement of the final working capital balances for the business, and (iv) disbursements for liabilities retained in connection with dispositions, including fees associated with the sale of Transformer Solutions.

(1) Income for the three months ended April 1, 2023 resulted primarily from income recorded in connection with the dispute resolution matter mentioned above, partially offset by legal costs incurred in connection with various dispute resolution matters that existed prior to the Settlement Agreement.

(2) Loss for the three months ended March 30, 2024 resulted primarily from revisions to liabilities retained in connection with prior dispositions.

(4) REVENUES FROM CONTRACTS

Disaggregated Revenues

We disaggregate revenue from contracts with customers by major product line and based on the timing of recognition for each of our reportable segments, as we believe such disaggregation best depicts how the nature, amount, timing, and uncertainty of our revenues and cash flows are affected by economic factors, with such disaggregation presented below for the three and nine months ended September 30, 2023 and October 1, 2022:

Three months ended September 30, 2023

Reportable Segments HVAC Detection and Measurement Total

Major product lines

Package and process cooling equipment and services, and engineered air movement solutions $ 170.8 $ — $ 170.8

Boilers, electrical heating, and ventilation 118.4 — 118.4

Underground locators, inspection and rehabilitation equipment, and robotic systems — 65.9 65.9

Communication technologies, aids to navigation, and transportation systems — 93.6 93.6

$ 289.2 $ 159.5 $ 448.7

Timing of Revenue Recognition

Revenues recognized at a point in time $ 271.3 $ 130.7 $ 402.0

Revenues recognized over time 17.9 28.8 46.7

$ 289.2 $ 159.5 $ 448.7

Nine months ended September 30, 2023

Reportable Segments HVAC Detection and Measurement Total

Major product lines

Package and process cooling equipment and services, and engineered air movement solutions $ 502.4 $ — $ 502.4

Boilers, electrical heating, and ventilation 307.4 — 307.4

Underground locators, inspection and rehabilitation equipment, and robotic systems — 199.0 199.0

Communication technologies, aids to navigation, and transportation systems — 263.0 263.0

$ 809.8 $ 462.0 $ 1,271.8

Timing of Revenue Recognition

Revenues recognized at a point in time $ 747.6 $ 386.2 $ 1,133.8

Revenues recognized over time 62.2 75.8 138.0

$ 809.8 $ 462.0 $ 1,271.8

Three months ended October 1, 2022

Three months ended March 30, 2024

Reportable Segments HVAC Detection and Measurement Total

2 unchanged sentences

Boilers, electrical heating, and ventilation 114.6 — 114.6

Underground locators, inspection and rehabilitation equipment, and robotic systems — 61.5 61.5

Underground locators, inspection and rehabilitation

equipment, and robotic systems — 61.0 61.0

Communication technologies, aids to navigation, and transportation systems — 101.8 101.8

4 unchanged sentences

$ 302.4 $ 162.8 $ 465.2

Nine months ended October 1, 2022

Three months ended April 1, 2023

Reportable Segments HVAC Detection and Measurement Total

2 unchanged sentences

Boilers, electrical heating, and ventilation 93.3 — 93.3

Underground locators, inspection and rehabilitation equipment, and robotic systems — 194.1 194.1

Underground locators, inspection and rehabilitation

equipment, and robotic systems — 65.9 65.9

Communication technologies, aids to navigation, and transportation systems — 82.3 82.3

9 unchanged sentences

On a contract-by-contract basis, the contract assets and contract liabilities are reported net within our condensed consolidated balance sheets.

Our contract balances consisted of the following as of September 30, 2023 and December 31, 2022:

Contract Balances September 30, 2023 December 31, 2022 Change

Our contract balances consisted of the following as of March 30, 2024 and December 31, 2023 :

Contract Balances March 30, 2024 December 31, 2023 Change

Contract Accounts Receivable (1)

8 unchanged sentences

(2) Included in “Other long-term liabilities” within the accompanying condensed consolidated balance sheets.

T he $ 38.0 in crease in our net contract balance from December 31, 2022 to September 30, 2023 was due primarily to revenue recognized during the period, partially offset by cash payments received from customers during the period as well as the inclusion of net contract assets acquired with the ASPEQ and TAMCO acquisitions.

During the three and nine months ended September 30, 2023, we recognized revenues of $ 4.9 and $ 35.5 , respectively, related to our contract liabilities at December 31, 2022.

The timing of revenue recognition, invoicing and cash collections results in contract accounts receivable, contract assets, and customer advances and deposits (contract liabilities) on our condensed consolidated balance sheets.

In general, we receive payments from customers based on a billing schedule established in our contracts.

During the three months ended March 30, 2024, changes in contract balances were not materially impacted by any other factors besides the acquisition of Ingénia.

At March 30, 2024, contract account receivables and current contract liabilities attributable to Ingénia were $ 20.7 and $ 0.7 , respectively.

During the three months ended March 30, 2024, we recognized revenues of $ 26.5 related to our contract liabilities at December 31, 2023 .

Performance Obligations

As of September 30, 2023, the aggregate amount allocated to remaining performance obligations was $ 210.8 .

We expect to recognize revenue on approximately 76 % and 89 % of remaining performance obligations over the next 12 and 24 months, respectively, with the remaining recognized thereafter.

There have been no material changes to our operating and finance leases during the three and nine months ended September 30, 2023.

As of March 30, 2024, the aggre gate amount allocat ed to remaining performance obligations was $ 141.4 .

We expect to recognize revenue on approximately 73 % and 86 % of remaining performance obliga tions over the next 12 and 24 months, respectively, with the remaining recognized thereafter.

There were no material changes to our operating and finance leases during the three months ended March 30, 2024.

(6) INFORMATION ON REPORTABLE SEGMENTS

5 unchanged sentences

Segment Income is determined before considering, if applicable, impairment and special charges, long-term incentive compensation, certain other operating income/expense, other indirect corporate expenses, intangible asset amortization expense, inventory step-up charges, and certain other acquisition-related costs.

This is consistent with the way our CODM evaluates the results of each segment.

This is consistent with the way our Chief Operating Decision Maker ( “ CODM ” ) evaluates the results of each segment.

HVAC Reportable Segment

Our HVAC reportable segment engineers, designs, manufactures, installs and services package and process cooling products and engineered air movement solutions for the HVAC industrial and power generation markets, as well as boilers and electrical heating and ventilation products for the residential and commercial markets.

Our HVAC reportable segment engineers, designs, manufactures, installs and services package and process cooling products and engineered air movement solutions for the HVAC industrial, commercial, data center, and power generation markets, as well as boilers and electrical heating and ventilation products for the residential and commercial markets.

The primary distribution channels for the segment’s products are direct to customers, independent manufacturing representatives, third-party distributors, and retailers.

The segment serves a customer base in North America, Europe, and Asia.

The segment serves a global customer base in North America, Europe, and Asia.

Detection and Measurement Reportable Segment

1 unchanged sentence

The primary distribution channels for the segment’s products are direct to customers and third-party distributors.

The segment serves a global customer base, with a strong presence in North America, Europe, Africa and Asia.

The segment serves a global customer base in North America, Europe, Africa, and Asia.

Corporate Expense

Corporate expense generally relates to the cost of our Charlotte, North Carolina corporate headquarters.

Financial data for our reportable segments for the three and nine months ended September 30, 2023 and October 1, 2022 are presented below:

Three months ended Nine months ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Corporate expense generally relates to the operating cost of our Charlotte, North Carolina corporate headquarters.

Financial data for our reportable segments for the three months ended March 30, 2024 and April 1, 2023 are presented below:

Three months ended

2024 April 1,

HVAC reportable segment $ 302.4 $ 251.6

3 unchanged sentences

Detection and Measurement reportable segment 31.4 26.7

Total income for reportable segments 91.6 63.4 250.4 159.1

Total income for segments 99.8 74.4

Corporate expense 13.9 14.6

Acquisition-related and other costs (1)

2.9 0.1 5.0 1.1

Long-term incentive compensation expense 3.3 3.1

Amortization of intangible assets 14.6 6.7 32.4 23.1

Amortization of acquired intangible assets 14.8 6.3

Special charges, net 0.6 —

Other operating expense, net — — — 1.0

Consolidated operating income $ 64.6 $ 49.8

______________________________

(1) Represents certain acquisition-related costs incurred of $ 2.9 and $ 5.0 during the three and nine months ended September 30, 2023, respectively, and $ 0.1 and $ 1.1 during the three and nine months ended October 1, 2022, respectively, including additional “Cost of products sold” related to the step-up of inventory (to fair value) acquired in connection with the ASPEQ acquisition of $ 2.5 and $ 3.6 during the three and nine months ended September 30, 2023, respectively, and the ITL acquisition of $ 0.1 and $ 1.1 during the three and nine months ended October 1, 2022, respectively.

(1) Represents certain acquisition-related costs incurred of $ 2.6 and $ 0.6 during the three months ended March 30, 2024 and April 1, 2023, respectively, including additional “Cost of products sold” related to the step-up of inventory (to fair value) acquired in connection with the Ingénia acquisition of $ 0.9 during the three months ended March 30, 2024.

(7) SPECIAL CHARGES, NET

There were no special charges for the three and nine months ended September 30, 2023.

No significant future charges are expected to be incurred under actions approved as of September 30, 2023.

Special charges, net, for the three and nine months ended October 1, 2022 are described in more detail below:

Three months ended Nine months ended

October 1, 2022 October 1, 2022

Special charges, net, for the three months ended March 30, 2024 and April 1, 2023 are described in more detail below:

Three months ended

2024 April 1,

HVAC reportable segment $ 0.3 $ —

1 unchanged sentence

Total $ 0.6 $ —

HVAC — Charges for the nine months ended October 1, 2022 related to severance costs associated with a restructuring action at one of the segment’s cooling businesses.

The following is an analysis of our restructuring liabilities for the nine months ended September 30, 2023 and October 1, 2022:

Nine months ended

September 30,

2023 October 1,

HVAC — Charges for the three months ended March 30, 2024 related primarily to severance costs associated with a restructuring action at one of the segment's cooling businesses.

Detection and Measurement — Charges for the three months ended March 30, 2024 related primarily to severance costs associated with restructuring actions at the segment's inspection and rehabilitation and aids to navigation businesses.

No significant future charges are expected to be incurred under actions approved as of March 30, 2024.

The following is an analysis of our restructuring liabilities for the three months ended March 30, 2024 and April 1, 2023:

Three months ended

2024 April 1,

Balance at beginning of year $ 0.7 $ —

4 unchanged sentences

(8) INVENTORIES, NET

Inventories are accounted for under the first-in, first-out method and are comprised of the following at September 30, 2023 and December 31, 2022:

September 30,

Inventories are accounted for under the first-in, first-out method and are comprised of the following at March 30, 2024 and December 31, 2023:

2024 December 31,

5 unchanged sentences

(9) GOODWILL AND OTHER INTANGIBLE ASSETS

The changes in the carrying amount of goodwill for the nine months ended September 30, 2023 were as follows:

The changes in the carrying amount of goodwill for the three months ended March 30, 2024 were as follows:

2023 Goodwill

1 unchanged sentence

Combinations (1)

Translation September 30,

Translation March 30,

HVAC reportable segment

10 unchanged sentences

___________________________

(1) Reflects (i) goodwill acquired with the TAMCO and ASPEQ acquisitions of $ 51.1 and $ 168.9 , respectively, and (ii) an increase in ITL ’s goodwill of $ 0.8 resulting from revisions to the valuation of certain assets and liabilities.

As indicated in Note 1, the acquired assets, including goodwill, and liabilities assumed in the TAMCO and ASPEQ acquisitions have been recorded at estimates of fair value and are subject to change upon completion of acquisition accounting.

(1) Reflects (i) goodwill acquired with the Ingénia acquisition of $ 141.2 and (ii) an increase in ASPEQ and TAMCO goodwill of $ 3.4 and $ 0.1 , respectively, resulting from revisions to the valuation of certain assets and liabilities.

As indicated in Note 1, the acquired assets, including goodwill, and liabilities assumed in the Ingénia, ASPEQ, and TAMCO acquisitions have been recorded at estimates of fair value and are subject to change upon completion of acquisition accounting.

Other Intangibles, Net

Identifiable intangible assets at September 30, 2023 and December 31, 2022 comprised the following:

September 30, 2023 December 31, 2022

Identifiable intangible assets at March 30, 2024 and December 31, 2023 comprised the following:

March 30, 2024 December 31, 2023

Value Accumulated

9 unchanged sentences

Trademarks with indefinite lives 220.5 — 220.5 221.3 — 221.3

219.8 — 219.8 168.7 — 168.7

Total $ 907.8 $ ( 147.2 ) $ 760.6 $ 813.9 $ ( 133.1 ) $ 680.8

___________________________

(1) The identifiable intangible assets associated with the TAMCO acquisition consist of customer relationships of $ 59.7 , technology of $ 9.3 , definite-lived trademarks of $ 3.2 , and backlog of $ 1.0 .

The identifiable intangible assets associated with the ASPEQ acquisition consist of customer relationships of $ 142.3 , technology of $ 47.8 , and backlog of $ 4.5 .

(2) Includes $ 51.5 of indefinite-lived trademarks associated with the ASPEQ acquisition.

In connection with the acquisitions of TAMCO and ASPEQ, which have definite-lived intangible assets as noted above, we updated our estimated annual amortization expense related to intangible assets to approximately $ 44.0 for the full year 2023 and $ 46.0 for 2024 and each of the four years thereafter.

At September 30, 2023 , the net carrying value of intangible assets with determinable lives consisted of $ 343.0 in the HVAC reportable segment and $ 125.1 in the Detection and Measurement reportable segment.

At September 30, 2023, trademarks with indefinite lives consisted of $ 156.5 in the HVAC reportable segment and $ 63.3 in the Detection and Measurement reportable segment.

We review goodwill and indefinite-lived intangible assets for impairment annually during th e fourth quarter in conjunction with our annual financial planning process, with such testing based primarily on events and circumstances existing as of the end of the third quarter.

(1) The gross carrying value of identifiable intangible assets acquired with the Ingénia acquisition consist of technology of $ 46.7 , customer relationships of $ 23.5 , definite-lived trademarks of $ 13.9 , and backlog of $ 13.8 .

In connection with the acquisition of Ingénia, which has definite-lived intangible assets as noted above, we updated our estimated annual amortization expense related to intangible assets to approximately $ 66.0 for the full year 2024, $ 54.0 for 2025, and $ 53.0 for each of the three years thereafter.

At March 30, 2024, the net carrying value of intangible assets with determinable lives consisted of $ 422.4 in the HVAC reportable segment and $ 117.7 in the Detection and Measurement reportable segment.

At March 30, 2024, trademarks with indefinite lives consisted of $ 156.6 in the HVAC reportable segment and $ 63.9 in the Detection and Measurement reportable segment.

as of the end of the third quarter.

In addition, we test goodwill for impairment on a more frequent basis if there are indications of potential impairment.

7 unchanged sentences

and a more likely than not expectation of selling or disposing all, or a portion, of a reporting unit.

During the fourth quarter of 2022, we performed a quantitative analysis on the goodwill of our Cincinnati Fan reporting unit.

The Cincinnati Fan analysis indicated that the fair value of its net assets exceeded the related carrying value by less than 10 %.

A change in assumptions used in Cincinnati Fan’s quantitative analysis (e.g., projected revenues and profit growth rates, discount rates, industry price multiples, etc.) could result in the reporting unit’s estimated fair value being less than the carrying value.

If Cincinnati Fan is unable to achieve its current financial forecast, we may be required to record an impairment charge in a future period related to its goodwill.

As of September 30, 2023, Cincinnati Fan’s goodwill totale d $ 54.8 .

The fair value of the assets related to the ASPEQ and Ingénia acquisitions approximate their respective carrying values.

If ASPEQ and Ingénia are unable to achieve their current financial forecast, we may be required to record an impairment charge in a future period related to their goodwill or indefinite-lived intangible assets.

As of March 30, 2024, ASPEQ and Ingénia's goodwill totaled $ 194.5 and $ 140.2 , respectively, and indefinite-lived intangible assets totaled $ 51.5 for ASPEQ.

We perform our annual trademarks impairment testing during the fourth quarter, or on a more frequent basis, if there are indications of potential impairment.

3 unchanged sentences

The following is an analysis of our product warranty accrual for the periods presented:

10 Nine months ended

September 30,

2023 October 1,

Three months ended

2024 April 1,

Balance at beginning of year $ 37.9 $ 34.7

2 unchanged sentences

Usage ( 4.2 ) ( 3.1 )

Currency translation adjustment ( 0.1 ) ( 0.2 )

Balance at end of period 38.5 35.7

2 unchanged sentences

(11) EMPLOYEE BENEFIT PLANS

On February 17, 2022, we transferred our existing liability under the SPX Postretirement Benefit Plans (the “Plans”) for a group of participants with retiree life insurance benefits to an insurance carrier for consideration payable to the insurance carrier of $ 10.0 .

Of this consideration, $ 9.0 was paid during the first quarter of 2022, with the remainder paid in the second quarter of 2022.

This transaction resulted in a settlement charge of $ 0.7 recorded to “Other income (expense), net” during the first quarter of 2022.

In addition, and in connection with this transfer, we remeasured the assets and liabilities of the Plans as of the transfer date, which resulted in a benefit of $ 0.4 recorded to “Other income (expense), net” for the three months ended April 2, 2022.

Participants in the SPX U.S.

Pension Plan (the “U.S.

Plan”) are eligible to elect a lump-sum payment option in lieu of a future pension benefit.

During the first half of 2022, $ 10.0 was paid to participants who elected lump-sum payments.

This triggered a plan settlement which resulted in a charge to “Other income (expense), net” of $ 2.3 during the second quarter of 2022.

In addition, we remeasured assets and liabilities of the U.S.

Plan at the settlement date, which resulted in an actuarial loss of $ 1.5 recorded to “Other income (expense), net” for the three months ended July 2, 2022.

Additional settlements by the U.S.

Plan during the quarter ended October 1, 2022 resulted in a charge to “Other income (expense), net” of $ 2.0 .

We also remeasured the assets and liabilities of the U.S.

Plan as of October 1, 2022, which resulted in an actuarial loss of $ 0.4 recorded to “Other income (expense), net” during the three months ended October 1, 2022.

Net periodic benefit (income) expense for our pension and postretirement plans include the following components:

Domestic Pension Plans

Three months ended Nine months ended

September 30,

2023 October 1,

2022 September 30,

2023 October 1,

Three months ended

2024 April 1,

Service cost $ — $ —

Interest cost 3.0 3.3

Expected return on plan assets ( 2.2 ) ( 2.2 )

Settlement and actuarial losses (1)

Net periodic pension benefit expense $ 0.8 $ 1.1

___________________________

(1) For the three months ended October 1, 2022, consists of a settlement loss of $ 2.0 and an actuarial loss of $ 0.4 .

For the nine months ended October 1, 2022, consists of settlement losses of $ 4.3 and actuarial losses of $ 1.9 .

Foreign Pension Plans

Three months ended Nine months ended

September 30,

2023 October 1,

2022 September 30,

2023 October 1,

Three months ended

2024 April 1,

Service cost $ — $ —

Interest cost 1.4 1.4

Expected return on plan assets ( 1.3 ) ( 1.6 )

Net periodic pension benefit income $ ( 0.2 ) $ ( 0.5 ) $ ( 0.6 ) $ ( 1.5 )

Net periodic pension benefit (income) expense $ 0.1 $ ( 0.2 )

Postretirement Plans

Three months ended Nine months ended

September 30,

2023 October 1,

2022 September 30,

2023 October 1,

Three months ended

2024 April 1,

Service cost $ — $ —

Interest cost 0.3 0.3

Amortization of unrecognized prior service credits ( 0.8 ) ( 1.0 )

Settlement loss, net (1)

Net periodic postretirement benefit income $ ( 0.5 ) $ ( 0.7 )

___________________________

(1) For t he nine months ended October 1, 2022, includes the impact of the transfer of the retiree life insurance benefits obligation.

(12) INDEBTEDNESS

The following summarizes our debt activity (both current and non-current) for the nine months ended September 30, 2023:

The following summarizes our debt activity (both current and non-current) for the three months ended March 30, 2024:

2023 Borrowings Repayments Other (5)

September 30,

Revolving loans (1)

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__________________________

(1) While not due for repayment until August 2027 under the terms of our senior credit agreement, we classify within current liabilities the portion of the outstanding balance that we believe will be repaid over the next year, with such amount based on an estimate of cash that is expected to be generated over such period.

The revolving loan facility was utilized as the initial funding mechanism for the TAMCO and ASPEQ acquisitions and was partially repaid with the funds borrowed on the Incremental Term Loan (see additional discussion below).

(2) As noted below, we amended our senior credit agreement on April 21, 2023, with the amendment making available an incremental term loan facility (“Incremental Term Loan”) in the amount of $ 300.0 .

The proceeds from the Incremental Term Loan were primarily used to fund the acquisition of ASPEQ.

(3) The term loans are repayable in quarterly installments equal to 0.625 % of the balance of $ 545.0 , beginning in December 2023 and in each of the first three quarters of 2024, and 1.25 % during the fourth quarter of 2024, all quarters of 2025 and 2026, and the first two quarters of 2027.

(1) While the revolving credit facility extends through August 2027 under the terms of our senior credit agreement, it is available in notes that mature, but may be reissued upon maturity, over varying terms of twelve months or less.

The revolving credit facility, classified within short-term debt, is primarily used to provide liquidity for general corporate and business needs or for funding acquisitions.

The revolving credit facility was utilized as the primary funding mechanism for the Ingénia acquisition.

(2) The term loans are repayable in quarterly installments equal to 0.625 % of the initial term loan balances of $ 545.0 , in each of the first three quarters of 2024, and 1.25 % during the fourth quarter of 2024, all quarters of 2025 and 2026, and the first two quarters of 2027.

The remaining balances are payable in full on August 12, 2027.

Balances are net of unamortized debt issuance costs of $ 1.8 and $ 0.7 at September 30, 2023 and December 31, 2022, respectively.

Balances are net of unamortized debt issuance costs of $ 1.6 and $ 1.7 at March 30, 2024 and December 31, 2023, respectively.

(3) Under this arrangement, we can borrow, on a continuous basis, up to $ 60.0 , as available.

Borrowings under this arrangement are collateralized by eligible trade receivables of certain of our businesses.

At September 30, 2023, we had $ 18.0 of available borrowing capacity under this facility after giving effect to outstanding borrowings of $ 32.0 .

(5) Primarily includes balances under a purchase card program of $ 1.8 and $ 1.8 and finance lease obligations of $ 0.6 and $ 0.7 at September 30, 2023 and December 31, 2022, respectively.

At March 30, 2024, we had $ 5.0 of available borrowing capacity under this facility after giving effect to outstanding borrowings of $ 34.0 .

(4) Primarily includes balances under a purchase card program of $ 1.6 and $ 1.9 and finance lease obligations of $ 0.8 and $ 0.5 at March 30, 2024 and December 31, 2023, respectively.

The purchase card program allows for payment beyond the normal payment terms for goods and services acquired under the program.

As this arrangement extends the payment of these purchases beyond their normal payment terms through third-party lending institutions, we have classified these amounts as short-term debt.

(6) “Other” includes the capitalization and amortization of debt issuance costs.

During the second quarter of 2023 we capitalized $ 1.3 of debt issuance costs associated with the Incremental Term Loan.

(5) “Other” includes the impact of amortization of debt issuance costs associated with the term loans.

Senior Credit Facilities

On April 21, 2023 (the “Incremental Amendment Effective Date”), we entered into an Incremental Facility Activation Notice (the “Incremental Amendment”) with Bank of America, N.A., as administrative agent (the “Administrative Agent”), and the lenders party thereto, which amends the Amended and Restated Credit Agreement, dated as of August 12, 2022 (as amended, the “Credit Agreement”), among the Company, the lenders party thereto, Deutsche Bank AG, as foreign trade facility agent, and the Administrative Agent.

The Incremental Amendment provides for an Incremental Term Loan in the aggregate amount of $ 300.0 , which was available in up to three drawings (subject to customary conditions) from the Incremental Amendment Effective Date to October 18, 2023.

The proceeds of the Incremental Term Loan were available to be used to finance, in part, permitted acquisitions, to pay related fees, costs and expenses and for other lawful corporate purposes.

The Incremental Term Loan will mature on August 12, 2027.

We may voluntarily prepay the Incremental Term Loan, in whole or in part, without premium or penalty.

In June 2023, we borrowed $ 300.0 under the Incremental Term Loan in connection with the ASPEQ acquisition.

The interest rate applicable to the Incremental Term Loan is, at our option, equal to either (x) an alternate base rate (the highest of (a) the federal funds effective rate plus 0.50 %, (b) the prime rate of Bank of America, N.A., and (c) the one-month Term SOFR rate plus 1.00 %) or (y) the Term SOFR rate for the applicable interest period plus 0.10 %, plus, in each case, an applicable margin percentage, which varies based on the Company’s Consolidated Leverage Ratio (defined in the Credit Agreement generally as the ratio of consolidated total debt (excluding the face amount of undrawn letters of credit, bank undertakings or analogous instruments and net of unrestricted cash and cash equivalents) at the date of determination to Consolidated EBITDA for the four fiscal quarters ended most recently before such date).

SPX may elect interest periods of one , three or six months (and, if consented to by all relevant lenders, any other period not greater than twelve months) for Term SOFR borrowings.

SPX will also pay a commitment fee to the incremental lenders on the daily unused amount of the

commitments for the Incremental Term Loan, payable quarterly at a per annum rate which also varies based on the Company’s Consolidated Leverage Ratio.

The commitment fee rate and interest rate margins for the Incremental Term Loan are as follows:

Consolidated Leverage Ratio Commitment Fee Term SOFR Loans

Less than 2.00 to 1.0

0.225 % 1.500 % 0.500 %

Greater than or equal to 2.00 to 1.0 but less than 3.00 to 1.0

0.250 % 1.625 % 0.625 %

Greater than or equal to 3.00 to 1.0

0.275 % 1.875 % 0.875 %

The Incremental Term Loan is guaranteed by certain domestic material subsidiaries of the Company and secured by a first priority pledge and security interest in 100 % of the capital stock of our domestic subsidiaries or the domestic subsidiary guarantors and 65 % of the voting capital stock (and 100 % of the non-voting capital stock) of material first-tier foreign subsidiaries, all subject to certain exceptions and on a pari passu basis with the other credit facilities under the Credit Agreement.

A detailed description of our remaining senior credit facilities under the Credit Agreement is included in our 2022 Annual Report on Form 10-K.

At September 30, 2023, we had $ 392.9 of available borrowing capacity under our revolving credit facilities, after giving effect to borrowings under the domestic revolving loan facility of $ 96.3 and $ 10.8 reserved for outstanding letters of credit.

In addition, at September 30, 2023, we had $ 9.7 of available issuance capacity under our foreign credit instrument facilities after giving effect to $ 15.3 reserved for outstanding letters of credit.

The weighted-average interest rate of outstanding borrowings under the Credit Agreement was approximately 7.0 % at September 30, 2023.

At September 30, 2023, we were in compliance with all covenants of the Credit Agreement.

In connection with an August 2022 amendment of the Credit Agreement, we recorded charges of $ 1.1 to “Loss on amendment/refinancing of senior credit agreement” related to the write-off of unamortized deferred financing costs totaling $ 0.7 and transaction costs of $ 0.4 .

Additionally, $ 1.5 of fees paid in connection with the August 2022 amendment were capitalized, with $ 1.2 related to our revolving loans and $ 0.3 related to the term loan.

A detailed description of our senior credit facilities is included in our 2023 Annual Report on Form 10-K.

At March 30, 2024, we had $ 207.8 of available borrowing capacity under our revolving credit facilities, after giving effect to borrowings under the domestic revolving loan facility of $ 281.4 and $ 10.8 reserved for outstanding letters of credit.

In addition, at March 30, 2024, we had $ 8.6 of available issuance capacity under our foreign credit instrument facilities after giving effect to $ 16.4 reserved for outstanding letters of credit.

The weighted-average interest rate of outstanding borrowings under our senior credit agreement was approximately 7.0 % at March 30, 2024.

At March 30, 2024, we were in compliance with all covenants of our senior credit agreement.

Company-owned Life Insurance

The Company has investments in company-owned life insurance (“COLI”) policies, which are recorded at their cash surrender value at each balance sheet date.

Changes in the cash surrender value during the period are recorded as a gain or loss within “Other income (expense), net” within our condensed consolidated statements of operations.

The cash surrender value of the company’s investments in COLI assets was $ 75.8 and $ 76.7 at March 30, 2024 and December 31, 2023, respectively, recorded in “Other assets” on the condensed consolidated balance sheets.

The Company has the ability to borrow against a portion of its investment in the COLI policies as an additional source of liquidity.

At March 30, 2024, the Company had not borrowed against any of its existing COLI policies’ cash surrender value.

(13) DERIVATIVE FINANCIAL INSTRUMENTS

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We have designated and are accounting for our Swaps as cash flow hedges.

As of September 30, 2023 and December 31, 2022 , the unrealized gain, net of tax, recorded in accumulated other comprehensive income ( “ AOCI ”) was $ 8.1 and $ 11.0 , respectively.

In addition, the fair value of our Swaps was $ 10.8 (with $ 9.6 recorded as a current asset and $ 1.2 as a non-current asset) as of September 30, 2023 , and $ 14.7 (with $ 8.7 recorded as a current asset and $ 6.0 as a non-current asset) as of December 31, 2022 .

As of March 30, 2024 and December 31, 2023 , the unrealized gain, net of tax, recorded in accumulated other comprehensive income ( “ AOCI ”) was $ 4.4 and $ 5.7 , respectively.

In addition, the fair value of our Swaps, recorded as a current asset, was $ 5.8 and $ 7.5 as of March 30, 2024 and December 31, 2023, respectively .

Changes in the fair value of our Swaps are reclassified into earnings as a component of interest expense, when the forecasted transaction impacts earnings.

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Our objective is to preserve the economic value of non-functional currency-denominated cash flows and to minimize the impact of changes as a result of currency fluctuations.

Our principal currency exposures relate to the South African Rand, British Pound Sterling, and Euro.

Our principal currency exposures relate to the South African Rand, British Pound Sterling, Canadian Dollar, and Euro.

From time to time, we enter into forward contracts to manage the exposure on contracts with forecasted transactions denominated in non-functional currencies and to manage the risk of transaction gains and losses associated with assets/liabilities denominated in currencies other than the functional currency of certain subsidiaries (“FX forward contracts”).

We had FX forward contracts related to continuing operations with an aggregate notional amount of $ 5.0 and $ 6.9 outstanding as of September 30, 2023 and December 31, 2022, respectively, with all of the $ 5.0 scheduled to mature within one year.

The fair value of these FX forward contracts was less than $ 0.1 at September 30, 2023 and December 31, 2022.

In addition, we entered FX forward contracts associated with the Settlement Agreement, to mitigate our exposure to fluctuations in the South African Rand, with a notional amount of $ 25.0 and a fair value of $ 0.2 , which is included within “Assets of DBT and Heat Transfer” on the condensed consolidated balance sheet as of September 30, 2023.

All of the $ 25.0 is scheduled to mature within one year.

We had FX forward contracts with an aggregate notional amount of $ 5.1 and $ 9.4 outstanding as of March 30, 2024 and December 31, 2023, respectively, with all of the $ 5.1 scheduled to mature within one year.

The fair value of these FX forward contracts was less than $ 0.1 at March 30, 2024 and December 31, 2023.

In addition to the above, we entered FX forward contracts associated with the Settlement Agreement, to mitigate our exposure to fluctuations in the South African Rand, with a notional amount of South African Rand 480.9 (or $ 24.9 at the time of execution) and a fair value of $ 0.6 and $ 1.3 at March 30, 2024 and December 31, 2023, respectively, which are included within “Assets of DBT and Heat Transfer” on the condensed consolidated balance sheets.

All of these FX forward contracts are scheduled to mature within one year.

Refer to Note 3 for additional details.

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The following table sets forth the number of weighted-average shares outstanding used in the computation of basic and diluted income per share:

Three months ended Nine months ended

September 30,

2023 October 1,

2022 September 30,

2023 October 1,

Three months ended

2024 April 1,

Weighted-average number of common shares used in basic income per share 45.828 45.382

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Weighted-average number of common shares and dilutive securities used in diluted income per share 46.683 46.402

The weighted-average number of restricted stock units and stock options excluded from the computation of diluted income per share because the assumed proceeds for these instruments exceed the average market value of the underlying common stock for the related period wer e 0.184 and 0.488 , respectively, for the three months ended September 30, 2023, and 0.191 and 0.521 , respectively, for the nine months ende d September 30, 2023 .

The weighted-average number of restricted stock units and stock options excluded from the computation of diluted income per share because the assumed proceeds for these instruments exceed the average market value of the underlying common stock for the related period were 0.243 and 0.655 , r espectively, for the three mon ths ended October 1, 2022, and 0.270 and 0.720 , respectively, for the nine months ended October 1, 2022.

The weighted-average number of restricted stock units and stock options excluded from the computation of diluted income per share because the assumed proceeds for these instruments exceed the average market value of the underlying common stock for the related period were 0.123 and 0.321 , respectively, for the three months ended March 30, 2024, and 0.173 and 0.534 , respectively, for the three months ended April 1, 2023.

Long-Term Incentive Compensation

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A detailed description of the awards granted prior to 2024 is included in our 2023 Annual Report on Form 10-K.

Awards granted on March 1 , 2023 to executive officers and other members of senior management were comprised of performance stock units (“PSU’s”), stock options, and time-based restricted stock units (“RSU’s”), while other eligible employees were granted PSU’s and RSU’s.

The PSU’s are eligible to vest at the end of a three-year performance period, with performance based on the total return of our stock over the three-year performance period against a peer group within the S&P 600 Capital Goods Index.

Awards granted on February 28, 2024 to executive officers and other members of senior management were comprised of performance stock units (“PSU’s”), stock options, and time-based restricted stock units (“RSU’s”), while other eligible employees were granted PSU’s and RSU’s.

Stock options and RSU’s vest ratably over the three-year period subsequent to the date of grant.

Effective May 9, 2023, we granted 0.014 RSU ’ s to our non-employee directors, which vest in their entirety immediately prior to the annual meeting of stockholders in May 2024.

C ompensation expense within income from continuing operations related to long-term incentive awards totaled $ 3.4 and $ 2.1 for the three months ended September 30, 2023 and October 1, 2022 , respectively, and $ 10.0 an d $ 7.7 for the nine months ended September 30, 2023 and October 1, 2022 , respectively.

The related tax b enefit was $ 0.6 and $ 0.3 for the three months ended September 30, 2023 and October 1, 2022, respectively, and $ 1.7 a nd $ 1.2 for the nine months ended September 30, 2023 and October 1, 2022 , respectively.

Repurchases of Common Stock

On May 10, 2022, and May 9, 2023, our Board of Directors authorized management, in its sole discretion, to repurchase, in any fiscal year, up to $ 100.0 of our common stock, subject to maintaining compliance with all covenants of our Credit Agreement.

Pursuant to this authorization, during the three months ended July 2, 2022, we repurchased approximately 0.7 shares of our common stock for aggregate cash payments of $ 33.7 .

Non-employee directors receive annual long-term incentive awards at the time of our annual meeting of stockholders, with the 2024 meeting scheduled for May 14, 2024.

C ompensation expense related to long-term incentive awards totaled $ 3.3 and $ 3.1 for the three months ended March 30, 2024 and April 1, 2023, respectively.

The related tax benefit was $ 0.6 and $ 0.5 for the three months ended March 30, 2024 and April 1, 2023, respectively.

PSU’s and RSU’s

We use the Monte Carlo simulation model valuation technique to determine the fair value of our restricted stock units that contain a market condition (i.e., the PSU’s).

The Monte Carlo simulation model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the award and calculates the fair value of each PSU.

The following table summarizes the PSU and RSU activity from December 31, 2023 through March 30, 2024 :

Unvested PSU’s and RSU’s Weighted-Average Grant-Date Fair Value Per Share

Outstanding at December 31, 2023 0.510 $ 58.53

Granted 0.135 122.71

Vested ( 0.187 ) 60.64

Forfeited ( 0.002 ) 55.59

Outstanding at March 30, 2024 0.456 $ 76.82

As of March 30, 2024 , there was $ 22.7 of unrecognized compensation cost related to PSU’s and RSU’s.

We expect this cost to be recognized over a weighted-average period of 2.5 years.

Stock Options

On February 28, 2024, we granted 0.052 stock options, all of which were outstanding (but not exercisable) as of March 30, 2024 .

The exercise price per share of these options is $ 116.40 and the maximum contractual term of these options is 10 years.

The fair value per share of the stock options granted on February 28, 2024 was $ 50.84 .

The fair value of each option grant was estimated using the Black-Scholes option-pricing model with the following assumptions:

Annual expected stock price volatility 37.43 %

Annual expected dividend yield — %

Risk-free interest rate 4.23 %

Expected life of stock option (in years) 6.0

Annual expected stock price volatility is based on a weighted average of SPX’s stock volatility of the most recent six-year historical volatility of a peer company group.

There is no annual expected dividend yield as we discontinued dividend

payments in 2015 and do not expect to pay dividends for the foreseeable future.

The average risk-free interest rate is based on the five-year and seven-year treasury constant maturity rates.

The expected option life is based on a three-year pro-rata vesting schedule and represents the period of time that awards are expected to be outstanding.

The following table summarizes the stock option activity from December 31, 2023 through March 30, 2024 :

Shares Weighted-Average Exercise Price

Options outstanding at December 31, 2023 1.221 $ 30.70

Exercised ( 0.404 ) 14.86

Forfeited — —

Granted 0.052 116.40

Options outstanding at March 30, 2024 0.869 $ 43.26

As of March 30, 2024 , there was $ 3.7 of unrecognized compensation cost related to stock options.

We expect this cost to be recognized over a weighted-average period of 2.6 years.

Accumulated Other Comprehensive Income

The changes in the components of AOCI, net of tax, for the three months ended September 30, 2023 were as follows:

Adjustment Net Unrealized Gains

on Qualifying Cash

Flow Hedges (1)

Postretirement

Adjustment (2)

Balance at beginning of period $ 247.4 $ 9.2 $ 5.9 $ 262.5

Other comprehensive income (loss) before reclassifications ( 10.0 ) 0.7 — ( 9.3 )

Amounts reclassified from accumulated other comprehensive income — ( 1.8 ) ( 0.7 ) ( 2.5 )

Current-period other comprehensive loss ( 10.0 ) ( 1.1 ) ( 0.7 ) ( 11.8 )

Balance at end of period $ 237.4 $ 8.1 $ 5.2 $ 250.7

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(1) Net of tax provision o f $ 2.7 and $ 3.1 as of September 30, 2023 and July 1, 2023, respectively.

(2) Net of tax provision of $ 1.9 and $ 2.2 as of September 30, 2023 and July 1, 2023, respectively.

The balances as of September 30, 2023 and July 1, 2023 include unamortized prior service credits.

The changes in the components of AOCI, net of tax, for the nine months ended September 30, 2023 were as follows:

The changes in the components of accumulated other comprehensive income, net of tax, for the three months ended March 30, 2024 were as follows:

Adjustment Net Unrealized Gains

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(1) Net of tax provision of $ 2.7 a nd $ 3.7 as of September 30, 2023 and December 31, 2022, respectively.

(2) Net of tax provision of $ 1.9 and $ 2.7 as of September 30, 2023 and December 31, 2022, respectively.

The balances as of September 30, 2023 and December 31, 2022 include unamortized prior service credits.

The changes in the components of AOCI, net of tax, for the three months ended October 1, 2022 were as follows:

Adjustment Net Unrealized Gains

on Qualifying Cash

Flow Hedges (1)

Postretirement

Adjustment (2)

Balance at beginning of period $ 236.3 $ 8.6 $ 9.1 $ 254.0

Other comprehensive income (loss) before reclassifications ( 19.2 ) 3.9 — ( 15.3 )

Amounts reclassified from accumulated other comprehensive income — ( 0.7 ) ( 0.8 ) ( 1.5 )

Current-period other comprehensive income (loss) ( 19.2 ) 3.2 ( 0.8 ) ( 16.8 )

Balance at end of period $ 217.1 $ 11.8 $ 8.3 $ 237.2

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(1) Net of tax provision of $ 4.0 and $ 2.9 as of October 1, 2022 and July 2, 2022, respectively.

(2) Net of tax provision of $ 3.0 and $ 3.2 as of October 1, 2022 and July 2, 2022, respectively.

The balances as of October 1, 2022 and July 2, 2022 include unamortized prior service credits.

The changes in the components of AOCI, net of tax, for the nine months ended October 1, 2022 were as follows:

(1) Net of tax provision o f $ 1.4 and $ 1.8 as of March 30, 2024 and December 31, 2023, respectively.

(2) Net of tax provision of $ 1.6 and $ 1.8 as of March 30, 2024 and December 31, 2023, respectively.

The balances as of March 30, 2024 and December 31, 2023 include unamortized prior service credits.

The changes in the components of accumulated other comprehensive income, net of tax, for the three months ended April 1, 2023 were as follows:

Adjustment Net Unrealized Gains

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(1) Net of tax provision of $ 4.0 and $ 0.1 as of October 1, 2022 and December 31, 2021, respectively.

(2) Net of tax provision of $ 3.0 and $ 3.7 as of October 1, 2022 and December 31, 2021, respectively.

The balances as of October 1, 2022 and December 31, 2021 include unamortized prior service credits.

The following summarizes amounts reclassified from each component of AOCI for the three months ended September 30, 2023 and October 1, 2022:

(1) Net of tax provision of $ 3.1 and $ 3.7 as of April 1, 2023 and December 31, 2022, respectively.

(2) Net of tax provision of $ 2.4 and $ 2.7 as of April 1, 2023 and December 31, 2022, respectively.

The balances as of April 1, 2023 and December 31, 2022 include unamortized prior service credits.

The following summarizes amounts reclassified from each component of accumulated other comprehensive income for the three months ended March 30, 2024 and April 1, 2023:

Amount Reclassified from AOCI

Three months ended

September 30, 2023 October 1, 2022 Affected Line Item in the Condensed

Consolidated Statements of Operations

Gains on qualifying cash flow hedges:

FX forward contracts $ — $ ( 0.2 ) Revenues

Swaps ( 2.4 ) ( 0.7 ) Interest expense

Pre-tax ( 2.4 ) ( 0.9 )

Income taxes 0.6 0.2

$ ( 1.8 ) $ ( 0.7 )

Gains on pension and postretirement items:

Amortization of unrecognized prior service credits - Pre-tax $ ( 1.0 ) $ ( 1.1 ) Other income (expense), net

Income taxes 0.3 0.3

$ ( 0.7 ) $ ( 0.8 )

The following summarizes amounts reclassified from each component of AOCI for the nine months ended September 30, 2023 and October 1, 2022:

Amount Reclassified from AOCI

Nine months ended

September 30, 2023 October 1, 2022 Affected Line Item in the Condensed

March 30, 2024 April 1, 2023 Affected Line Item in the Condensed

Consolidated Statements of Operations

Gains on qualifying cash flow hedges:

FX forward contracts $ — $ ( 0.2 ) Revenues

Swaps $ ( 2.4 ) $ ( 2.1 ) Interest expense

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Numerous claims, complaints and proceedings arising in the ordinary course of business have been asserted or are pending against us or certain of our subsidiaries (collectively, “claims”).

These claims relate to litigation matters (e.g., class actions, derivative lawsuits and contracts, intellectual property and competitive claims), environmental matters, product liability matters (which, prior to the Asbestos Portfolio Sale, were predominately associated with alleged exposure to asbestos-containing materials), and other risk management matters (e.g., general liability, automobile, and workers’ compensation claims).

These claims relate to litigation matters (e.g., class actions, derivative lawsuits and contracts, intellectual property and competitive claims), environmental matters, claims for contingent consideration on prior acquisitions, product liability matters, and other risk management matters (e.g., general liability, automobile, and workers’ compensation claims).

Additionally, we may become subject to other claims of which we are currently unaware, which may be significant, or the claims of which we are aware may result in our incurring significantly greater loss than we anticipate.

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Also, while we believe we are entitled to indemnification from third parties for some of these claims, these rights may be insufficient or unavailable to protect us against potential loss exposures.

Our recorded liab ilities related to these matters, primarily associated with environmental matters, totaled $ 37.1 and $ 39.5 at September 30, 2023 and December 31, 2022, respectively.

Of these amounts, $ 30.1 and $ 30.8 are included in “Other long-term liabilities” within our condensed consolidated balance sheets at September 30, 2023 and December 31, 2022 , respectively, with the remainder included in “Accrued expenses.” The liabilities we record for these matters are based on a number of assumptions, including historical claims and payment experience.

Our recorded liab ilities related to these matters, primarily associated with environmental matters, totaled $ 38.7 and $ 37.9 at March 30, 2024 and December 31, 2023, respectively.

Of these amounts, $ 29.9 and $ 29.4 are included in “Other long-term liabilities” within our condensed consolidated balance sheets at March 30, 2024 and December 31, 2023 , respectively, with the remainder included in “Accrued expenses.” The liabilities we record for these matters are based on a number of assumptions, including historical claims and payment experience.

While we base our assumptions on facts currently known to us, they entail inherently subjective judgments and uncertainties.

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These variances relative to current expectations could have a material impact on our financial position and results of operations.

Asbestos Matters

As indicated in Note 1, we completed the Asbestos Portfolio Sale on November 1, 2022, which resulted in the divestiture of three wholly-owned subsidiaries that hold asbestos liabilities and certain assets, including related insurance assets.

As a result of this transaction, the Company divested all obligations with respect to pending and future asbestos claims relating to these subsidiaries.

During the nine months ended October 1, 2022, our payments for asbestos-related claims, net of respective insurance recoveries of $ 27.7 , were $ 20.2 .

During the three and nine months ended October 1, 2022, we recorded charges for asbestos-related matters of $ 21.7 and $ 24.0 , respectively, with $ 16.5 and $ 18.8 , respectively, recorded to continuing operations and the remainder to discontinued operations.

Of such charges, $ 21.7 (continuing operations - $ 16.5 and discontinued operations - $ 5.2 ) resulted from a ruling by a North Carolina trial court, during the third quarter of 2022, that certain excess insurance carriers associated with our asbestos product liability matters are not required to cover the costs of defending suits that are dismissed without an indemnity payment.

Large Power Projects in South Africa

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During that time, the business environment surrounding these projects was difficult, as DBT, along with many other contractors on the projects, experienced delays, cost over-runs, and various other challenges associated with a complex set of contractual relationships among the end customer, prime contractors, various subcontractors (including DBT and its subcontractors), and various suppliers.

Since substantial completion of the works, DBT’s remaining responsibilities related largely to resolution of various claims, primarily between itself and MHI, the remaining prime contractor.

As noted below, SPX and DBT entered into a Settlement Agreement with MHI during the third quarter of 2023.

Prior to the Settlement Agreement, DBT had asserted claims against MHI of approximately South African Rand 1,000.0 (or $ 52.1 ) and MHI had asserted, or issued letters of intent to claim for, alleged damages against DBT.

(ii) complexity of contractual relationships between the end customer, MHI, and DBT;

(iii) legal interpretation of the contract provisions and application of South African law to the contracts;

and (iv) unpredictable nature of any dispute resolution processes that may have occurred in connection with these claims.

Prior to the Settlement Agreement, DBT had experienced success in enforcing its rights through dispute resolution processes, including favorable arbitration rulings during 2023 related to awards for (i) costs incurred in connection with delays

on the Kusile project of South African Rand 126.6 (or $ 6.8 ) during the first quarter of 2023 and (ii) recovery of legal costs related to arbitration proceedings of $ 6.8 during the second quarter of 2023, with such amounts recorded within “Loss on disposition of discontinued operations, net of tax.” There were no rulings or awards during the third quarter of 2023.

Resolution of Remaining Prime Contractor Claims - We have invested, and would have continued to invest, significant management and financial resources to defend and pursue these matters.

On September 5, 2023, SPX Technologies and DBT entered into the Settlement Agreement with MHI to affect the negotiated resolution of all outstanding claims between the parties with respect to the large power projects.

DBT had asserted claims against the remaining prime contractor, MHI, and MHI had asserted, or issued letters of intent to claim for, alleged damages against DBT.

As previously disclosed in our 2023 Annual Report on Form 10-K, and as mentioned in Note 3, on September 5, 2023, DBT and SPX entered into the Settlement Agreement to resolve all claims between the parties with respect to the two large power projects.

The Settlement Agreement provides for full and final settlement and the mutual release of all claims between the parties with respect to the projects, including any claim against SPX Technologies, Inc.

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Refer to Note 3 for additional details.

Prior to the Settlement Agreement, DBT had experienced success in enforcing its rights through dispute resolution processes, including a favorable arbitration ruling during the first quarter of 2023 related to awards for costs incurred

in connection with delays on the Kusile project of South African Rand 126.6 (or $ 7.0 ) with such amount recorded to “Gain (loss) on disposition of discontinued operations, net of tax.”

Claim against Surety - On February 5, 2021, DBT received payment of $ 6.7 on bonds issued in support of performance by one of DBT’s subcontractors.

The subcontractor maintains a right to seek recovery of such amount and, thus, the amount received by DBT has not been reflected in our condensed consolidated statements of operations.

The subcontractor, currently in liquidation, maintains a right to seek recovery of such amount and, thus, the amount received by DBT has not been reflected in our condensed consolidated statements of operations.

Claim for Contingent Consideration Related to ULC Robotics (“ULC”) Acquisition

In connection with our acquisition of ULC in September 2020, the seller of ULC was eligible for additional cash consideration of up to $ 45.0 upon achievement of certain operating and financial performance milestones.

At the time of the acquisition, we recorded a liability of $ 24.3 , which represented the estimated fair value of the contingent consideration.

During the third quarter of 2021, we concluded that the operational and financial performance milestones noted above were not achieved and, thus, no amount is due to the seller.

On August 23, 2022, the seller of ULC initiated a breach-of-contract lawsuit against us in the United States District Court for the Eastern District of New York claiming that it is entitled to a portion of the additional cash consideration, linked to certain operating performance milestones, totaling $ 15.0 .

SPX has numerous defenses against this claim and, thus, we do not believe we have a probable loss associated with the claim.

If successful with their claim, the plaintiff is also eligible to recover pre-judgement interest and attorney's fees in addition to the $ 15.0 claimed.

We have defenses against the claim and, thus, while we do not believe we have a probable loss associated with the claim, it is reasonably possible we may incur a loss associated with it.

Resolution of Dispute with Former Representative

On January 18, 2024, a jury ruled that one of our businesses within the Detection and Measurement reportable segment had breached its contract and implied duties of good faith and fair dealings in connection with an agreement entered into with a former representative.

On January 26, 2024, we negotiated a settlement requiring a payment, paid during the first quarter of 2024, to the former representative of $ 9.0 to resolve all claims related to the matter.

This amount was recorded within “ Accrued Liabilities ” on the condensed consolidated balance sheet as of December 31, 2023.

Litigation Matters

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Based on current information, we believe that our operations are in substantial compliance with applicable environmental laws and regulations, and we are not aware of any violations that could have a material effect, individually or in the aggregate, on our business, financial condition, and results of operations or cash flows.

We had liabilities for site investigation and/or remediation at 17 sites that we own or control, or formerly owned and controlled, as of September 30, 2023 and December 31, 2022.

We had liabilities for site investigation and/or remediation at 16 sites that we own or control, as of March 30, 2024 and December 31, 2023.

In addition, while we believe that we maintain adequate accruals to cover the costs of site investigation and/or remediation, we cannot provide assurance that new matters, developments, laws and regulations, or stricter interpretations of existing laws and regulations will not materially affect our business or operations in the future.

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Accordingly, our estimates may change based on future developments, including new or changes in existing environmental laws or policies, differences in costs required to complete anticipated actions from estimates provided, future findings of investigation or remediation actions, or alteration to the expected remediation plans.

It is our policy to revise an estimate once the revision becomes probable and the amount of change can be reasonably estimated.

It is our policy to revise an estimate once it becomes probable and the amount of change can be reasonably estimated.

We generally do not discount our environmental accruals and do not reduce them by anticipated insurance recoveries.

We take into account third-party indemnification from financially viable parties in determining our accruals where there is no dispute regarding the right to indemnification.

In the case of contamination at offsite, third-party disposal sites, as of September 30, 2023 and December 31, 2022, we have been notified that we are potentially responsible and have received other notices of potential liability pursuant to various environmental laws at 9 sites, at which the liability has not been settled and all of which have been active in the past few years.

In the case of contamination at offsite, third-party disposal sites, as of March 30, 2024 and December 31, 2023, we have been notified that we are potentially responsible and have received other notices of potential liability pursuant to various environmental laws at 9 sites, at which the liability has not been settled, and all of which have been active in the past few years.

These laws may impose liability on certain persons that are considered jointly and severally liable for the costs of investigation and remediation of hazardous substances present at these sites, regardless of fault or legality of the original disposal.

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We record a liability when it is both probable and the amount can be reasonably estimated.

In our opinion, after considering accruals established for such purposes, the cost of remedial actions for compliance with the present laws and regulations governing the protection of the environment are not expected to have a material impact, individually or in the aggregate, on our financial position, results of operations or cash flows.

In our opinion, after considering accruals established for such purposes of $ 24.1 at March 30, 2024 and December 31, 2023, the cost of remedial actions for compliance with the present laws and regulations governing the protection of the environment are not expected to have a material impact, individually or in the aggregate, on our financial position, results of operations or cash flows.

Self-Insured Risk Management Matters

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Uncertain Tax Benefits

As of September 30, 2023 , we had gross unrecognized tax be nefits of $ 2.4 (net unrecognized tax benefits of $ 2.4 ).

As of March 30, 2024 , we had gross and net unrecognized tax benefi ts of $ 2.0 .

All of these net unrecognized tax benefits would impact our effective tax rate from continuing operations if recognized.

We classify interest and penalties related to unrecognized tax benefits as a component of our income tax provision.

As of September 30, 2023, gross accrued interest totaled $ 1.3 (net accrued interest of $ 1.2 ).

As of September 30, 2023, we had no accrual for penalties included in our unrecognized tax benefits.

Based on the outcome of certain examinations or as a result of the expiration of statutes of limitations for certain jurisdictions, we believe that within the next 12 months it is reasonably possible that our previously unrecognized tax benefits could decrease by up to $ 1.0 .

The previously unrecognized tax benefits relate to a variety of tax matters including transfer pricing and various state matters.

As of March 30, 2024, gross and net accrued interest totaled $ 1.3 .

As of March 30, 2024, we had no accrual for penalties included in our unrecognized tax benefits.

Based on the outcome of certain examinations or as a result of the expiration of statutes of limitations for certain jurisdictions, we do not believe that within the next 12 months our previously unrecognized tax benefits will decrease by a material amount.

The previously unrecognized tax benefits relate to a variety of tax matters including transfer pricing and various foreign matters.

Organization for Economic Co-operation and Development (“OECD”) Pillar Two Model Rules

In December 2021, the OECD issued model rules for a new global minimum tax framework (“Pillar Two”), and various governments around the world have issued, or are in the process of issuing, legislation to implement these rules.

The Company is within the scope of the OECD Pillar Two model rules and is assessing the impact thereof.

As of March 30, 2024, we believe the implementation of these rules will not have a material impact on our financial results.

Other Tax Matters

For the three months ended September 30, 2023, we recorded an income tax provision of $ 12.4 on $ 48.1 of pre-tax income from continuing operations, resulting in an effective rate of 25.8 %.

This compares to an income tax benefit for the three months ended October 1, 2022 of $ 2.5 on $ 10.0 of pre-tax income from continuing operations, resulting in an effective rate of ( 25.0 )%.

The most significant items impacting the income tax provision for the third quarter of 2023 are (i) $ 0.8 of foreign withholding tax, and (ii) $ 0.3 of excess tax benefits associated with stock-based compensation awards that vested and/or were exercised during the period.

The most significant item impacting the income tax benefit for the third quarter of 2022 was a tax benefit of $ 4.2 related to the release of valuation allowances recognized against certain deferred tax assets as we now expect these deferred tax assets to be realized.

For the nine months ended September 30, 2023, we recorded an income tax provision of $ 31.5 on $ 144.6 of pre-tax income from continuing operations, resulting in an effective rate of 21.8 %.

This compares to an income tax provision for the nine months ended October 1, 2022 of $ 4.5 on $ 49.1 of pre-tax income from continuing operations, resulting in an effective rate of 9.2 %.

The most significant items impacting the income tax provision during the first nine months of 2023 and 2022 were (i) $ 1.8 and $ 4.2 , respectively, of tax benefit related to the release of valuation allowances recognized against certain deferred tax assets as we now expect these deferred tax assets to be realized, (ii) $ 1.7 and $ 0.7 , respectively, of excess tax benefits associated with stock-based compensation awards that vested and/or were exercised during the period, and (iii) $ 1.2 and $ 0.7 , respectively, of tax benefits related to revisions to liabilities for uncertain tax positions.

For the three months ended March 30, 2024, we recorded an income tax provision of $ 1.9 on $ 51.1 of pre-tax income from continuing operations, resulting in an effective rate of 3.7 %.

This compares to an income tax provision for the three months ended April 1, 2023 of $ 11.3 on $ 50.4 of pre-tax income from continuing operations, resulting in an effective rate of 22.4 %.

The most significant item impacting the income tax provision for the first quarters of 2024 and 2023 was $ 10.9 and $ 0.9 , respectively, of excess tax benefits resulting from stock-based compensation awards that vested and/or were exercised during the periods.

We perform reviews of our income tax positions on a continuous basis and accrue for potential uncertain positions when we determine that an uncertain position meets the criteria of the Income Taxes Topic of the Codification.

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We believe that any uncertain tax positions related to these examinations have been adequately provided for.

An unfavorable resolution of one or more of the above matters could have a material impact on our financial position, results of operations, or cash flows in the quarter and year in which an adjustment is recorded or the tax is due or paid.

An unfavorable resolution of one or more of the above matters could have a material impact on our results of operations or cash flows in the quarter and year in which an adjustment is recorded or the tax is due or paid.

As audits and examinations are still in process, the timing of the ultimate resolution and any payments that may be required for the above matters cannot be determined at this time.

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There were no transfers between the three levels of the fair value hierarchy for the periods pres ented.

Valuation Methods Used to Measure Fair Value on a Non-Recurring Basis

Contingent Consideration for Sensors & Software and Enterprise Control Systems Acquisitions — In connection with the acquisition of Sensors & Software in 2020, the sellers were eligible for additional cash consideration of up to $ 3.7 , with payment of such contingent consideration dependent upon the achievement of certain milestones.

Such contingent consideration totaled $ 1.3 , and was paid during the quarter ended April 2, 2022.

In connection with the acquisition of Enterprise Control Systems Ltd.

in 2021, the seller was eligible for additional cash consideration of up to $ 15.2 , with payment of such contingent consideration dependent upon the achievement of certain milestones.

During the first and second quarters of 2022, we concluded the probability of achieving the financial performance milestones had lessened due to a delay in the execution of certain large orders.

Thus, during the quarters ended April 2, 2022 and July 2, 2022, we reduced the fair value/liability by $ 0.9 and $ 0.4 , respectively, with such amounts recorded to “Other operating expense, net.” The estimated fair value of such contingent consideration was $ 0.0 at September 30, 2023 and December 31, 2022 as we determined no additional cash consideration was due to the seller.

Contingent Consideration for the Ingénia Acquisition — In connection with the acquisition of Ingénia, the seller is eligible for additional cash consideration of up to CAD 3.0 (or $ 2.2 at the time of acquisition), with payment scheduled to be made in the event certain contingent liabilities do not materialize.

The estimated fair value of such contingent consideration is $ 0.3 , which is reflected as a liability in our condensed consolidated balance sheet as of March 30, 2024.

Goodwill, Indefinite-Lived Intangible and Other Long-Lived Assets — Certain of our non-financial assets are subject to impairment analysis, including long-lived assets, indefinite-lived intangible assets and goodwill.

We review the carrying amounts of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable or at least annually for indefinite-lived intangible assets and goodwill.

Any asset impairment would result in the asset being recorded at its fair value.

Valuation Methods Used to Measure Fair Value on a Recurring Basis

We review the carrying

amounts of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable or at least annually for indefinite-lived intangible assets and goodwill.

Any resulting asset impairment would require that the instrument be recorded at its fair value.

Derivative Financial Instruments — Our financial derivative assets and liabilities include interest rate swaps and FX forward contracts, valued using valuation models based on observable market inputs such as forward rates, inte rest rates, our own credit risk and the credit risk of our counterparties, which comprise investment-grade financial institutions.

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We have not made any adjustments to the inputs obtained from the independent sources.

Based on our continued ability to enter into forward contracts, we consider the markets for our fair value instruments active.

Based on our continued ability to enter into interest rate swaps and FX forward contracts, we consider the markets for our fair value instruments active.

We primarily use the income approach, which uses valuation techniques to convert future amounts to a single present amount.

As of September 30, 2023, there has been no significant impact to the fair value of our derivative liabilities due to our own credit risk, as the related instruments are collateralized under our senior credit facilities.

As of March 30, 2024, there has been no significant impact to the fair value of our derivative liabilities due to our own credit risk, as the related instruments are collateralized under our senior credit facilities.

Similarly, there has been no significant impact to the fair value of our derivative assets based on our evaluation of our counterparties’ credit risks.

Equity Security — We estimate the fair value of an equity security that we hold utilizing a practical expedient under existing guidance, with such estimated fair value based on our ownership percentage applied to the net asset value as provided quarterly by the investee.

The value is updated annually, during the first quarter, based on the investee ’s most recent audited financial statements.

During the three and nine months ended September 30, 2023 and October 1, 2022 , we re corded gains (losses) of $ 0.0 and $( 7.4 ), respectively, and $ 3.6 and $( 3.0 ), respectively, to “Other income (expense), net” to reflect the change in the estimated fair value of the equity security.

As of September 30, 2023 and December 31, 2022, the equity security had an estimated fair value of $ 39.4 and $ 35.8 , respectively.

Indebtedness and Other — The estimated fair value of our debt instruments as of September 30, 2023 and December 31, 2022 approximated the related carrying values due primarily to the variable market-based interest rates for such instruments.

During the first quarter, the net asset value is updated based on the investee’s most recent audited financial statements.

During the three months ended March 30, 2024 and April 1, 2023, we recorded a loss of $ 4.2 and a gain of $ 3.6 , respectively, to “ Other income (expense), net ” to reflect the change in the estimated fair value of the equity security.

As of March 30, 2024 and December 31, 2023 , the equity security had an estimated fair value of $ 35.2 and $ 39.4 , respectively.

Indebtedness and Other — The estimated fair value of our debt instruments as of March 30, 2024 and December 31, 2023 approximated the related carrying values due primarily to the variable market-based interest rates for such instruments.

Se e Note 12 f or further details.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements