
	Year ended December 31,
	2021		2020		2019
Numerator:
Income from continuing operations attributable to SPX Corporation common stockholders for calculating basic and diluted income per share	$	59.0	$	73.8	$	76.3
Income (loss) from discontinued operations, net of tax	$	366.4	$	25.2	$	(11.0)
Adjustment related to redeemable noncontrolling interest (Note 15)	—		—		5.6
Income (loss) from discontinued operations attributable to SPX Corporation common stockholders for calculating basic and diluted income per share	$	366.4	$	25.2	$	(5.4)
Denominator:
Weighted-average number of common shares used in basic income per share	45.289		44.628		43.942
Dilutive securities — Employee stock options, restricted stock shares and restricted stock units	1.206		1.138		1.015
Weighted-average number of common shares and dilutive securities used in diluted income per share	46.495		45.766		44.957

For the years ended December 31, 2021, 2020, and 2019, 0.245, 0.300, and 0.319, respectively, of unvested restricted stock shares/units were excluded from the computation of diluted earnings per share as the assumed proceeds for these instruments exceeded the average market value of the underlying common stock for the related years. For the years ended December 31, 2021, 2020, and 2019, 0.627, 0.793, and 0.942, respectively, of outstanding stock options were excluded from the computation of diluted earnings per share as the assumed proceeds for these instruments exceeded the average market value of the underlying common stock for the related years.

At December 31, 2021, we had 200.0 authorized shares of common stock (par value $0.01). Common shares issued, treasury shares and shares outstanding are summarized in the table below.


	Common Stock Issued	Treasury Stock	Shares Outstanding
Balance at December 31, 2018	51.529	(8.078)	43.451


Restricted stock units	—	0.264	0.264
Other	0.488	—	0.488
Balance at December 31, 2019	52.017	(7.814)	44.203

Restricted stock units	—	0.141	0.141

Other	0.688	—	0.688
Balance at December 31, 2020	52.705	(7.673)	45.032

Restricted stock units	—	0.130	0.130

Other	0.306	—	0.306
Balance at December 31, 2021	53.011	(7.543)	45.468

On May 9, 2019, our stockholders approved our 2019 Stock Compensation Plan (the “2019 Plan”) which replaced our 2002 Stock Compensation Plan, as amended in 2006, 2011, 2012 and 2015 (the “Prior Plan”). As a result of the approval of the 2019 Plan, no further awards were permitted to be made under the Prior Plan. Up to 4.074 shares of our common stock were available for grant at December 31, 2021 under the 2019 Plan. The 2019 Plan permits the issuance of new shares or shares from treasury upon the exercise of options, vesting of time-based restricted stock units (“RSU’s”) and performance stock units (“PSU’s”), or the granting of restricted stock shares (“RS’s”). Each RSU, RS and PSU granted reduces availability by two shares. Similar awards were permitted to be granted under the Prior Plan before the approval of the 2019 Plan.

PSU’s, RSU’s and RS’s may be granted to certain eligible employees or non-employee directors in accordance with applicable equity compensation plan documents and agreements. Subject to participants’ continued employment and other plan terms and conditions, the restrictions lapse and awards generally vest over a period of time, generally one or three years. In some instances, such as death, disability, or retirement, stock may vest concurrently with or following an employee’s termination. PSU’s are eligible to vest at the end of the 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, while the RSU’s and RS’s vest based on the passage of time since grant date. PSU’s, RSU’s, and RS’s that do not vest within the applicable vesting period are forfeited.

We grant RSU’s or RS’s to non-employee directors under the 2006 Non-Employee Directors’ Stock Incentive Plan (the “Directors’ Plan”) and the 2019 Plan. Under the Directors’ Plan, up to 0.027 shares of our common stock were available for grant at December 31, 2021. The 2021, 2020 and 2019 grants to non-employee directors generally vest over a 1 year-period, with the 2021 grants scheduled to vest in their entirety immediately prior to the annual meeting of stockholders in May 2022.

Stock options may be granted to key employees in the form of incentive stock options or non-qualified stock options. The option price per share may be no less than the fair market value of our common stock at the close of business the day prior to the date of grant. Upon exercise, the employee has the option to surrender previously owned shares at current value in payment of the exercise price and/or for withholding tax obligations.

The recognition of compensation expense for share-based awards, including stock options, is based on their grant date fair values. The fair value of each award is amortized over the lesser of the award’s requisite or derived service period, which is generally up to three years. Compensation expense within income from continuing operations related to PSU’s, RSU’s, RS’s and stock options totaled $12.9, $12.0 and $10.0 for the years ended December 31, 2021, 2020 and 2019, respectively, with the related tax benefit being $2.2, $2.0 and $2.4 for the years ended December 31, 2021, 2020 and 2019, respectively.

In years prior to 2019, annual long-term cash awards were granted to executive officers and other members of senior management. These awards are eligible to vest at the end of a three-year performance measurement period, with performance based on our achievement of a target segment income amount over the three-year measurement period. Long-term incentive compensation expense for 2021, 2020, and 2019 included $(0.1), $1.1 and $2.6, respectively, associated with long-term cash awards.

We use the Monte Carlo simulation model valuation technique to determine fair value of our restricted stock awards 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. We issued PSU’s to eligible participants on March 1, 2021, February 20, 2020 and February 21, 2019. We used the following assumptions in determining the fair value of these awards:


	Annual Expected Stock Price Volatility		Annual Expected Dividend Yield		Risk-Free Interest Rate		Correlation Between Total Shareholder Return for SPX and the Applicable S&P Index
March 1, 2021
SPX Corporation	42.88	%	—	%	0.25	%	60.24	%
Peer group within S&P 600 Capital Goods Index	51.25	%	n/a		0.25	%
February 20, 2020
SPX Corporation	29.47	%	—	%	1.35	%	35.47	%
Peer group within S&P 600 Capital Goods Index	34.93	%	n/a		1.35	%
February 21, 2019
SPX Corporation	32.70	%	—	%	2.53	%	38.75	%
Peer group within S&P 600 Capital Goods Index	34.75	%	n/a		2.48	%

Annual expected stock price volatility is based on the three-year historical volatility. 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 one-year through three-year daily treasury yield curve rate as of the grant date.


	Unvested PSU’s, RSU’s, and RS’s	Weighted-Average Grant-Date Fair Value Per Share
December 31, 2018	0.652	$	24.65
Granted	0.430	35.49
Vested	(0.446)	18.75
Forfeited	(0.030)	35.10
December 31, 2019	0.606	36.17
Granted	0.277	46.61
Vested	(0.233)	31.49
Forfeited	(0.006)	41.37
December 31, 2020	0.644	42.32
Granted	0.243	57.24
Vested	(0.219)	37.40
Forfeited	(0.032)	53.69
December 31, 2021	0.636	$	49.14

As of December 31, 2021, there was $10.9 of unrecognized compensation cost related to PSU’s, RSU’s and RS’s. We expect this cost to be recognized over a weighted-average period of 1.8 years.

On March 1, 2021, February 20, 2020 and February 21, 2019, we granted stock options totaling 0.105, 0.125 and 0.186, respectively. The exercise price per share of these options is $58.34, $50.09 and $36.51, respectively, and the maximum contractual term of these options is ten years.

The fair value of each stock option granted on March 1, 2021, February 20, 2020 and February 21, 2019 was $23.49, $17.40 and $13.31, respectively. The fair value of each option grant was estimated using a Black-Scholes option-pricing model with the following assumptions:


	March 1, 2021		February 20, 2020		February 21, 2019
Annual expected stock price volatility	41.15	%	33.48	%	32.70	%
Annual expected dividend yield	—	%	—	%	—	%
Risk-free interest rate	0.91	%	1.41	%	2.53	%
Expected life of stock option (in years)	6.0		6.0		6.0

Annual expected stock price volatility for the March 1, 2021, February 20, 2020 and February 21, 2019 grants were based on a weighted average of SPX’s stock volatility since the Spin-Off and an average 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.


	Shares	Weighted- Average Exercise Price
Options outstanding at December 31, 2018	1.718	$	16.58
Exercised	(0.202)	13.46
Forfeited	(0.013)	33.15
Granted	0.189	36.50
Options outstanding at December 31, 2019	1.692	19.05
Exercised	(0.412)	14.97
Forfeited	—	—
Granted	0.139	49.57
Options outstanding at December 31, 2020	1.419	23.21
Exercised	(0.123)	15.82
Forfeited	(0.008)	50.11
Granted	0.105	58.34
Options outstanding at December 31, 2021	1.393	$	26.35

As of December 31, 2021, 1.150 of the above stock options were exercisable and there was $1.6 of unrecognized compensation cost related to the outstanding stock options. We expect this cost to be recognized over a weighted-average period of 2.0 years.


	Foreign Currency Translation Adjustment		Net Unrealized Gains (losses) on Qualifying Cash Flow Hedges(1)		Pension and Postretirement Liability Adjustment(2)		Total
Balance at December 31, 2020	$	238.6	$	(4.4)	$	14.3	$	248.5
Other comprehensive income (loss) before reclassifications	(5.8)		5.3		—		(0.5)
Amounts reclassified from accumulated other comprehensive income (loss)	19.9		(0.4)		(3.6)		15.9
Current-period other comprehensive income (loss)	14.1		4.9		(3.6)		15.4
Balance at December 31, 2021	$	252.7	$	0.5	$	10.7	$	263.9


	Foreign Currency Translation Adjustment		Net Unrealized Losses on Qualifying Cash Flow Hedges (1)		Pension and Postretirement Liability Adjustment and Other (2)		Total
Balance at December 31, 2019	$	228.0	$	(1.6)	$	17.9	$	244.3
Other comprehensive income (loss) before reclassifications	10.6		(5.7)		—		4.9
Amounts reclassified from accumulated other comprehensive income (loss):	—		2.9		(3.6)		(0.7)
Current-period other comprehensive income (loss)	10.6		(2.8)		(3.6)		4.2
Balance at December 31, 2020	$	238.6	$	(4.4)	$	14.3	$	248.5


	Amount Reclassified from AOCI				Affected Line Items in the Consolidated Statements of Operations
	Year ended December 31,
	2021		2020
(Gains) losses on qualifying cash flow hedges:

Commodity contracts	$	(3.8)	$	(0.9)	Income from discontinued operations, net of tax
Swaps	3.2		4.7		Interest expense
Pre-tax	(0.6)		3.8
Income taxes	0.2		(0.9)
	$	(0.4)	$	2.9
Pension and postretirement items:

Amortization of unrecognized prior service credits - Pre-tax	$	(4.8)	$	(4.8)	Other income (expense), net

Income taxes	1.2		1.2
	$	(3.6)	$	(3.6)

Loss on reclassification of foreign currency translation adjustments:
DBT	$	19.9	$	—	Gain on disposition of discontinued operations, net of tax
Income taxes	—		—
	$	19.9	$	—

During the years ended December 31, 2021, 2020 and 2019, “Common stock in treasury” was decreased by the settlement of restricted stock units issued from treasury stock of $7.7, $8.4 and $15.8, respectively.