What changed in this filing

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Item 1. Financial Statements

2024-05-10 compared with 2023-10-27 · 335 added, 556 removed, 754 unchanged (54% of the section changed)

3 unchanged sentences

(Dollars in thousands, except share and per share data)

Notes September 30, 2023 December 31, 2022

Notes March 31, 2024 December 31, 2023

Current assets:

25 unchanged sentences

200,000,000 shares authorized;

300,000 shares issued and outstanding as of September 30, 2023 and December 31, 2022;

redemption amount of $ 448.2 million at September 30, 2023 and December 31, 2022)

300,000 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively;

redemption amount of $ 446.5 million at March 31, 2024 and December 31, 2023)

15 342,207 325,232

1 unchanged sentence

2,000,000,000 shares authorized;

99,490,386 and 99,445,074 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively)

101,693,823 and 100,589,572 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively)

Additional paid in capital 822,956 843,971

5 unchanged sentences

Total liabilities, redeemable preferred stock and equity $ 2,344,681 $ 2,379,609

See accompanying notes to consolidated and combined consolidated financial statements.

See accompanying notes to consolidated financial statements.

FTAI INFRASTRUCTURE INC.

CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(Dollars in thousands, except share and per share data)

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Notes 2024 2023

7 unchanged sentences

Total expenses 93,884 91,890

Other income (expense)

Equity in losses of unconsolidated entities 5 ( 9,914 ) ( 12,080 ) ( 7,173 ) ( 47,982 )

(Loss) gain on sale of assets, net ( 263 ) ( 134 ) 260 ( 134 )

Loss on extinguishment of debt 7 ( 2,020 ) — ( 2,020 ) —

Other (expense) income

Equity in (losses) earnings of unconsolidated entities 5 ( 11,902 ) 4,366

Loss on sale of assets, net ( 13 ) ( 124 )

Interest expense ( 27,593 ) ( 23,250 )

Other income (expense) 2,387 ( 1,132 ) 3,978 ( 2,144 )

Other income 2,365 221

Total other expense ( 37,143 ) ( 18,787 )

3 unchanged sentences

Net loss attributable to non-controlling interests in consolidated subsidiaries ( 10,690 ) ( 9,893 )

Dividends and accretion on redeemable preferred stock 15,984 9,263 45,811 9,263

Net loss attributable to stockholders/Former Parent $ ( 56,101 ) $ ( 44,076 ) $ ( 135,543 ) $ ( 116,378 )

Dividends and accretion of redeemable preferred stock 16,975 14,570

Net loss attributable to stockholders $ ( 56,582 ) $ ( 40,589 )

Loss per share:

4 unchanged sentences

Diluted 104,189,287 102,787,640

See accompanying notes to consolidated and combined consolidated financial statements.

See accompanying notes to consolidated financial statements.

FTAI INFRASTRUCTURE INC.

CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (unaudited)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (unaudited)

(Dollars in thousands)

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Net loss $ ( 50,297 ) $ ( 35,912 )

Other comprehensive income (loss):

Other comprehensive income (loss) related to equity method investees 5,504 ( 41,999 ) 120,934 ( 186,661 )

Other comprehensive (loss) income:

Other comprehensive (loss) income related to equity method investees ( 21,115 ) 52,852

Change in pension and other employee benefit accounts ( 13 ) ( 12 )

Comprehensive (loss) income ( 71,425 ) 16,928

Comprehensive loss attributable to non-controlling interest ( 9,932 ) ( 8,381 ) ( 30,101 ) ( 24,327 )

Comprehensive (loss) income attributable to stockholders/Former Parent $ ( 34,624 ) $ ( 76,812 ) $ 31,167 $ ( 293,776 )

See accompanying notes to consolidated and combined consolidated financial statements.

Comprehensive loss attributable to non-controlling interests ( 10,690 ) ( 9,893 )

Comprehensive (loss) income attributable to stockholders $ ( 60,735 ) $ 26,821

See accompanying notes to consolidated financial statements.

FTAI INFRASTRUCTURE INC.

CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (unaudited)

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (unaudited)

(Dollars in thousands)

Three and Nine Months Ended September 30, 2023

Three Months Ended March 31, 2024

Common Stock Additional Paid In Capital Accumulated Deficit Accumulated Other Comprehensive Loss Non-Controlling Interest in Equity of Consolidated Subsidiaries Total Equity

1 unchanged sentence

Net loss ( 39,607 ) ( 10,690 ) ( 50,297 )

Other comprehensive income 115,406 115,406

Total comprehensive (loss) income — — ( 49,615 ) 115,406 ( 20,169 ) 45,622

Other comprehensive loss ( 21,128 ) ( 21,128 )

Total comprehensive loss — — ( 39,607 ) ( 21,128 ) ( 10,690 ) ( 71,425 )

Settlement of equity-based compensation ( 3,029 ) ( 185 ) ( 3,214 )

Acquisition of consolidated subsidiary ( 953 ) ( 3,495 ) ( 4,448 )

Distributions to non-controlling interest (20) —

Dividends declared on common stock ( 6,170 ) ( 6,170 )

Dividends and accretion on redeemable preferred stock ( 29,827 ) ( 29,827 )

Equity-based compensation 80 1,457 1,537

Equity - June 30, 2023 $ 994 $ 874,729 $ ( 110,452 ) $ ( 184,727 ) $ ( 49,146 ) $ 531,398

Net loss ( 40,117 ) ( 9,932 ) ( 50,049 )

Other comprehensive income 5,493 5,493

Total comprehensive (loss) income — — ( 40,117 ) 5,493 ( 9,932 ) ( 44,556 )

Issuance of common shares 10 ( 10 ) —

Distributions to non-controlling interest ( 1,626 ) ( 1,626 )

Dividends declared on common stock ( 3,051 ) ( 3,051 )

Dividends and accretion on redeemable preferred stock ( 15,984 ) ( 15,984 )

Dividends and accretion of redeemable preferred stock ( 16,975 ) ( 16,975 )

Equity-based compensation 2,050 290 2,340

Equity - September 30, 2023 $ 994 $ 862,675 $ ( 150,569 ) $ ( 179,234 ) $ ( 63,412 ) $ 470,454

FTAI INFRASTRUCTURE INC.

CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (unaudited)

(Dollars in thousands)

Three and Nine Months Ended September 30, 2022

Common Stock Net Former Parent Investment Additional Paid in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Non-Controlling Interest in Equity of Consolidated Subsidiaries Total Equity

Equity - March 31, 2024 $ 1,016 $ 822,956 $ ( 221,780 ) $ ( 199,643 ) $ ( 82,015 ) $ 320,534

Three Months Ended March 31, 2023

Common Stock Additional Paid in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Non-Controlling Interest in Equity of Consolidated Subsidiaries Total Equity

Equity - December 31, 2022 $ 994 $ 911,599 $ ( 60,837 ) $ ( 300,133 ) $ ( 26,829 ) $ 524,794

Net loss ( 26,019 ) ( 9,893 ) ( 35,912 )

Other comprehensive loss ( 144,662 ) ( 144,662 )

Total comprehensive loss — ( 72,302 ) — ( 144,662 ) ( 15,946 ) ( 232,910 )

Acquisition of a consolidated subsidiary 3,054 3,054

Contribution from non-controlling interest 562 562

Net transfers from Former Parent 111,396 111,396

Equity-based compensation 1,665 1,665

Equity - June 30, 2022 $ — $ 1,656,695 $ — $ — $ ( 300,126 ) $ ( 10,756 ) $ 1,345,813

Net loss ( 20,445 ) ( 14,368 ) ( 8,381 ) ( 43,194 )

Other comprehensive loss ( 41,999 ) ( 41,999 )

Total comprehensive loss — ( 20,445 ) — ( 14,368 ) ( 41,999 ) ( 8,381 ) ( 85,193 )

Contributions from non-controlling interest 170 170

Net transfers to Former Parent ( 728,717 ) ( 728,717 )

Distribution by Former Parent 994 ( 907,533 ) 906,539 —

Other comprehensive income 52,840 52,840

Total comprehensive (loss) income — — ( 26,019 ) 52,840 ( 9,893 ) 16,928

Settlement of equity-based compensation ( 90 ) ( 90 )

Issuance of warrants 13,764 13,764

Issuance of manager options 18,127 18,127

Distribution to Manager ( 79 ) ( 79 )

Dividends and accretion on redeemable preferred stock ( 9,263 ) ( 9,263 )

Acquisition of a consolidated subsidiary ( 953 ) ( 3,495 ) ( 4,448 )

Dividends declared on common stock ( 3,084 ) ( 3,084 )

Dividends and accretion of redeemable preferred stock ( 14,570 ) ( 14,570 )

Equity-based compensation 895 895

Equity - September 30, 2022 $ 994 $ — $ 929,088 $ ( 14,368 ) $ ( 342,125 ) $ ( 17,738 ) $ 555,851

See accompanying notes to consolidated and combined consolidated financial statements.

Equity - March 31, 2023 $ 994 $ 892,992 $ ( 86,856 ) $ ( 247,293 ) $ ( 39,412 ) $ 520,425

See accompanying notes to consolidated financial statements.

FTAI INFRASTRUCTURE INC.

CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

(Dollars in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from operating activities:

1 unchanged sentence

Adjustments to reconcile net loss to net cash used in operating activities:

Equity in losses of unconsolidated entities 7,173 47,982

(Gain) loss on sale of assets, net ( 260 ) 134

Loss on extinguishment of debt 2,020 —

Equity in losses (earnings) of unconsolidated entities 11,902 ( 4,366 )

Loss on sale of assets, net 13 124

Equity-based compensation 2,340 895

5 unchanged sentences

Amortization of bond discount 1,426 1,045

Provision for credit losses 1,661 418

Provision for (benefit from) credit losses 169 ( 165 )

Accounts receivable 1,907 ( 10,825 )

1 unchanged sentence

Accounts payable and accrued liabilities 9,206 6,700

Management fees payable to affiliate 10,926 2,381

Other liabilities ( 47 ) ( 2,157 )

2 unchanged sentences

Investment in unconsolidated entities ( 611 ) ( 2,126 )

Investment in convertible promissory notes ( 51,044 ) ( 20,000 )

Acquisition of business, net of cash acquired ( 4,448 ) ( 3,819 )

Acquisition of consolidated subsidiary — ( 4,448 )

Acquisition of leasing equipment ( 396 ) —

Acquisition of property, plant and equipment ( 12,859 ) ( 39,861 )

Proceeds from sale of leasing equipment 116 —

Investment in promissory notes and loans — ( 20,500 )

Investment in equity instruments ( 5,000 ) —

Proceeds from sale of property, plant and equipment 20 93

2 unchanged sentences

Proceeds from debt — 41,600

Repayment of debt ( 75,131 ) —

Payment of deferred financing costs ( 265 ) ( 649 )

Proceeds from issuance of redeemable preferred stock — 291,000

Redeemable preferred stock issuance costs — ( 16,418 )

Cash dividends - common stock — ( 3,084 )

Capital contribution from non-controlling interests — 732

Net transfers to Former Parent, net — ( 617,322 )

Settlement of equity-based compensation ( 189 ) ( 90 )

Distributions to non-controlling interests ( 1,647 ) —

Distribution to Manager — ( 79 )

Net cash provided by financing activities 69,506 127,337

Net cash (used in) provided by financing activities ( 454 ) 37,777

Net decrease in cash and cash equivalents and restricted cash ( 23,183 ) ( 41,209 )

3 unchanged sentences

Acquisition of property, plant and equipment $ — $ ( 2,245 )

Dividends and accretion on redeemable preferred stock ( 45,811 ) ( 9,263 )

FTAI INFRASTRUCTURE INC.

CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

(Dollars in thousands)

Conversion of interests in unconsolidated subsidiaries — ( 21,302 )

Dividends and accretion of redeemable preferred stock ( 16,975 ) ( 14,570 )

Non-cash change in equity method investment ( 21,115 ) 52,852

Deferred financing costs ( 2,012 ) —

See accompanying notes to consolidated and combined consolidated financial statements.

Common stock dividends accrued ( 3,051 ) —

Settlement of equity-based compensation ( 3,027 ) —

See accompanying notes to consolidated financial statements.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

1 unchanged sentence

(“we”, “us”, “our”, or the “Company”) is a Delaware corporation and was originally formed as a limited liability company on December 13, 2021 in connection with the spin-off of the infrastructure business (“FTAI Infrastructure”) of FTAI Aviation Ltd.

(previously Fortress Transportation and Infrastructure Investors LLC, “FTAI” or “Former Parent”).

The Company owns and operates (i) five freight railroads and one switching company that provide rail service to certain manufacturing and production facilities (“Transtar”), (ii) a multi-modal crude oil and refined products terminal in Beaumont, Texas (“Jefferson Terminal”), (iii) a deep-water port located along the Delaware River with an underground storage cavern, a multipurpose dock, a rail-to-ship transloading system and multiple industrial development opportunities (“Repauno”), (iv) an equity method investment in a multi-modal terminal located along the Ohio River with multiple industrial development opportunities, including a power plant (“Long Ridge”), and (v) an equity method investment in two ventures developing battery and metal recycling technology (“Aleon” and “Gladieux”).

(previously Fortress Transportation and Infrastructure Investors LLC;

“FTAI” or “Former Parent”).

The Company owns and operates (i) six freight railroads and one switching company that provide rail service to certain manufacturing and production facilities (“Transtar”), (ii) a multi-modal crude oil and refined products terminal in Beaumont, Texas (“Jefferson Terminal”), (iii) a deep-water port located along the Delaware River with an underground storage cavern, a multipurpose dock, a rail-to-ship transloading system and multiple industrial development opportunities (“Repauno”), (iv) an equity method investment in a multi-modal terminal located along the Ohio River with multiple industrial development opportunities, including a power plant (“Long Ridge”), and (v) an equity method investment in two ventures developing battery and metal recycling technology (“Aleon” and “Gladieux”).

Additionally, we own and lease shipping containers (“Containers”) and operate a railcar cleaning business (“KRS”) as well as an operating company that provides roadside assistance services for the intermodal and over-the-road trucking industries (“FYX”).

1 unchanged sentence

(i) Railroad, (ii) Jefferson Terminal, (iii) Repauno, (iv) Power and Gas, and (v) Sustainability and Energy Transition, which all operate in the infrastructure sector (see Note 14).

On August 1, 2022 (the “Spin-off Date”), FTAI distributed to the holders of FTAI common shares, one share of FTAI Infrastructure Inc.

common stock for each FTAI common share held by such shareholder at the close of business on July 21, 2022 and we became an independent, publicly-traded company trading on The Nasdaq Global Select Market under the symbol “FIP.” The Company is headquartered in New York, New York.

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation:

Unaudited Consolidated and Combined Consolidated Financial Statements

The Company’s financial statements for the periods through the Spin-off Date are combined consolidated financial statements.

The Company’s financial statements for the period after the Spin-off Date are consolidated financial statements based on the reported results of FTAI Infrastructure Inc.

as a standalone company.

The historical results of operations, financial position, and cash flows of FTAI Infrastructure represented in the combined consolidated financial statements may not be indicative of what they would have been had FTAI Infrastructure actually been a separate standalone entity during such periods, nor are they necessarily indicative of our future results of operations, financial position, and cash flows.

Basis of Presentation:

Prior to Spin-Off

The Company’s financial statements for the periods through the Spin-off Date were prepared on a standalone basis as if the operations had been conducted independently from the Former Parent and have been derived from the consolidated financial statements and accounting records of the Former Parent.

Accordingly, Former Parent’s net investment in our operations (Net Former Parent investment) was shown in lieu of stockholders’ equity in the accompanying combined consolidated financial statements, which include the historical operations comprising the infrastructure business of FTAI.

Prior to the Spin-off Date, the combined consolidated financial statements include certain assets and liabilities that have historically been held by the Former Parent but are specifically identifiable or otherwise attributable to FTAI Infrastructure.

All significant intercompany transactions between Former Parent and FTAI Infrastructure have been included as components of Net Former Parent investment in the combined consolidated financial statements, as they are to be considered effectively settled upon effectiveness of the spin-off.

The combined consolidated financial statements are presented as if our businesses had been combined for all periods presented.

Principles of Combination — FTAI Infrastructure has elected the principles of combined consolidated financial statements as the basis of presentation for the periods through the Spin-off Date due to common ownership and management of the entities, which includes the financial results of the Railroad, Jefferson Terminal, Repauno, Power and Gas, and Sustainability and Energy Transition segments.

Cash and Cash Equivalents — The Cash and Cash Equivalents reflected in the financial statements through the Spin-off Date are Cash and Cash Equivalents that were legally held by FTAI Infrastructure during the periods presented in the financial statements and are directly attributed to and used in the operations of FTAI Infrastructure.

Debt and the Corresponding Interest Expense — The Debt reflected in the financial statements through the Spin-off Date was debt that was directly attributable to, and legally incurred by, FTAI Infrastructure.

The corresponding interest expense presented in the financial statements was derived solely from the Debt directly attributed to FTAI Infrastructure.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Corporate Function — For the periods through the Spin-off Date, the combined consolidated financial statements include all revenues and costs directly attributable to FTAI Infrastructure and an allocation of certain expenses.

The Former Parent was externally managed by the Manager, which performed the Former Parent’s corporate function, and incurred a variety of expenses including, but not limited to, information technology, accounting, treasury, tax, legal, corporate finance and communications.

For purposes of the Combined Consolidated Statements of Operations, an allocation of these expenses was included to reflect our portion of such corporate overhead from the Former Parent.

The charges reflected have either been specifically identified or allocated based on an estimate of time spent on FTAI Infrastructure.

These allocated costs were recorded in general and administrative, and acquisition and transaction expenses in the Combined Consolidated Statements of Operations.

We believe the assumptions regarding allocations of the Former Parent’s Corporate expenses are reasonable.

Nevertheless, the allocations may not be indicative of the actual expense that would have been incurred had FTAI Infrastructure operated as an independent, standalone public entity, nor are they indicative of the Company’s future expenses.

Actual costs that may have been incurred if FTAI Infrastructure had been a standalone company would depend on a number of factors, including the organizational structure, what functions were outsourced or performed by employees and strategic decisions made in areas such as information technology and infrastructure.

The Former Parent funded FTAI Infrastructure’s operating and investing activities as needed.

Cash transfers to and from the Former Parent are reflected in the Combined Consolidated Statements of Cash Flows as “Net transfers to Former Parent, net”.

Refer to Note 13 for additional discussion on corporate costs allocated from the Former Parent that are included in these combined consolidated financial statements .

Subsequent to the Spin-off Date, the Company operated as a standalone company based on actual expenses incurred.

Unaudited Interim Financial Information — The accompanying interim Consolidated Balance Sheet as of September 30, 2023, the Consolidated and Combined Consolidated Statements of Operations, Comprehensive (Loss) Income and Changes in Equity for the three and nine months ended September 30, 2023 and 2022, and the Consolidated and Combined Statements of Cash Flows for the nine months ended September 30, 2023 and 2022 are unaudited.

These unaudited interim consolidated and combined consolidated financial statements have been prepared in accordance with U.S.

We are a publicly-traded company trading on The Nasdaq Global Select Market under the symbol “FIP.” The Company is headquartered in New York, New York.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting — The accompanying consolidated financial statements are prepared in accordance with U.S.

generally accepted accounting principles (“U.S.

In the opinion of our management, the unaudited interim consolidated and combined consolidated financial statements include all adjustments necessary for the fair presentation of our financial position as of September 30, 2023, the results of operations, comprehensive (loss) income and changes in equity for the three and nine months ended September 30, 2023 and 2022, and cash flows for the nine months ended September 30, 2023 and 2022.

The results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any other period.

GAAP”) and include the accounts of us and our subsidiaries.

These financial statements and related notes should be read in conjunction with the Consolidated Financial Statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

Principles of Consolidation — We consolidate all entities in which we have a controlling financial interest and control over significant operating decisions, as well as variable interest entities (“VIEs”) in which we are the primary beneficiary.

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Use of Estimates — The preparation of financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated and combined consolidated financial statements and the reported amounts of revenues and expenses during the reporting period, including allocations from the Former Parent during the period prior to the spin-off.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

Actual results could differ from those estimates.

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We do not have significant exposure to foreign currency risk as all of our leasing and revenue arrangements are denominated in U.S.

Liquidity —In performing the first step of the evaluation under ASC 205-40, management concluded that the Company’s current liquidity and forecasted cash flows from operations are not sufficient to support, in full, the repayments of Jefferson Terminal’s $ 75.0 million credit agreement due on December 13, 2024 and Taxable Series 2020B Bonds totaling $ 79.1 million that mature on January 1, 2025 and dividend payments on Series A Preferred Stock.

In performing the second step of this assessment, the Company evaluated whether it is probable that the Company’s plans will be effectively implemented within one year after the financial statements are issued and whether it is probable that those plans will alleviate the liquidity risk raised in the first step of the evaluation.

Management has approved and began implementing a plan to alleviate liquidity risk by:

(i) refinancing the Taxable Series 2020B Bonds and issuing new long-term, low-cost municipal bonds, including contributing additional unencumbered assets as collateral;

and (ii) continuing to accrue paid-in-kind dividends on its Series A Senior Preferred Stock.

On May 10, 2024, Jefferson Terminal announced an approximately $ 276 million municipal bond offering and expects to close the offering in the coming weeks.

If fully implemented, the Company will have sufficient liquidity to meet its obligations as they become due over the next twelve months from the date that the consolidated financial statements were issued.

Management will continue to evaluate its liquidity and financial position and update future plans accordingly.

Variable Interest Entities —The assessment of whether an entity is a VIE and the determination of whether to consolidate a VIE requires judgment.

VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties.

A VIE is required to be consolidated by its primary beneficiary, and only by its primary beneficiary, which is defined as the party who has the power to direct the activities of a VIE that most significantly impact its economic performance and who has the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE.

VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties.

Delaware River Partners LLC

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We concluded that we are the primary beneficiary;

and accordingly, DRP has been presented on a consolidated basis in the accompanying consolidated and combined consolidated financial statements.

Total VIE assets of DRP were $ 301.1 million and $ 306.0 million, and total VIE liabilities of DRP were $ 33.6 million and $ 34.1 million as of September 30, 2023 and December 31, 2022, respectively.

and accordingly, DRP has been presented on a consolidated basis in the accompanying consolidated financial statements.

Total VIE assets of DRP were $ 303.3 million and $ 305.0 million, and total VIE liabilities of DRP were $ 55.4 million and $ 52.7 million as of March 31, 2024 and December 31, 2023, respectively.

Cash and Cash Equivalents — We consider all highly liquid short-term investments with a maturity of 90 days or less when purchased to be cash equivalents.

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Scrap value at end of useful life

Vehicles 5 - 7 years from date of manufacture

Scrap value at end of useful life

Furniture and fixtures 3 - 6 years from date of purchase

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Interest capitalization ceases once a project is substantially complete or no longer undergoing construction activities to prepare it for its intended use.

We capitalized interest of $ 1.1 million and $ 2.6 million during the three months ended September 30, 2023 and 2022, respectively, and $ 3.9 million and $ 6.9 million during the nine months ended September 30, 2023 and 2022, respectively.

We capitalized interest of $ 1.0 million and $ 1.4 million during the three months ended March 31, 2024 and 2023, respectively.

Repairs and Maintenance — Repair and maintenance costs that do not extend the lives of the assets are expensed as incurred.

Our repairs and maintenance expenses were $ 5.3 million and $ 3.9 million during the three months ended September 30, 2023 and 2022, respectively, and $ 14.5 million and $ 9.3 million during the nine months ended September 30, 2023 and 2022, respectively, and are included in Operating expenses in the Consolidated and Combined Consolidated Statements of Operations.

Our repairs and maintenance expenses were $ 5.2 million and $ 4.3 million during the three months ended March 31, 2024 and 2023, respectively, and are included in Operating expenses in the Consolidated Statements of Operations.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

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The factors considered in estimating the undiscounted cash flows are impacted by changes in future periods due to changes in contracted lease rates, terminal service, and freight rail rates, residual values, economic conditions, technology, demand for a particular asset type and other factors.

Other Current Assets — Other current assets is primarily comprised of commodities inventory of $ 0.3 million and $ 3.6 million, deposits of $ 1.9 million and $ 22.8 million, note receivable of $ 21.4 million and $ 20.0 million, prepaid expenses of $ 11.0 million and $ 16.4 million, and other assets of $ 2.7 million and $ 4.5 million as of September 30, 2023 and December 31, 2022, respectively.

Other Assets — Other assets primarily consists of a note receivable of $ 10.8 million as of both September 30, 2023 and December 31, 2022 from CarbonFree, a business that develops technologies to capture carbon dioxide from industrial emissions sources.

Accounts Payable and Accrued Liabilities — Accounts payable and accrued liabilities primarily include payables relating to construction projects, interline payables to other railroads, accrued compensation, interest and payables to Manager.

Other Current Liabilities — Other current liabilities primarily include environmental liabilities of $ 0.5 million and $ 4.1 million, insurance premium liabilities of $ 3.4 million and $ 6.2 million, deposits of $ 7.5 million and $ — million , and deferred revenue of $ 5.2 million and $ 3.3 million as of September 30, 2023 and December 31, 2022, respectively.

Other Current Assets — Other current assets is comprised of:

March 31, 2024

December 31, 2023

Note receivable

$ 21,425 $ 21,425

Prepaid expenses

Other receivables

Total other current assets

$ 46,321 $ 42,034

The Company records interest income on the note receivable in Other income in the Consolidated Statements of Operations using the contractual interest rate.

Other Assets — Other assets primarily consists of a note receivable of $ 11.7 million as of March 31, 2024 and December 31, 2023, respectively, from CarbonFree, a business that develops technologies to capture carbon dioxide from industrial emissions sources.

We elected the fair value option for this note receivable to better align the reported results with the underlying changes in the value of this note receivable.

The Company records interest income, which is included in Other income in the Consolidated Statements of Operations, on this note receivable using the contractual interest rate.

Other assets also consists of capitalized contract costs of $ 24.9 million and $ 17.6 million as of March 31, 2024 and December 31, 2023, respectively.

Goodwill — Goodwill includes the excess of the purchase price over the fair value of the net tangible and intangible assets associated with the acquisition of Jefferson Terminal, Transtar and FYX.

The carrying amount of goodwill within the Jefferson Terminal, Railroad and Corporate and Other segments was $ 122.7 million, $ 147.2 million, and $ 5.4 million, respectively, as of September 30, 2023.

The carrying amount of goodwill within the Jefferson Terminal, Railroad and Corporate and Other segments was $ 122.7 million, $ 132.1 million, and $ 5.4 million, respectively, as of December 31, 2022.

We review the carrying values of goodwill at least annually to assess impairment since these assets are not amortized.

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We estimate the fair value of Jefferson Terminal using an income approach, specifically a discounted cash flow analysis.

This analysis requires us to make significant assumptions and estimates about the forecasted revenue growth rates, EBITDA margins and discount rates.

This analysis requires us to make significant assumptions and estimates about the forecasted revenue growth rates, EBITDA margins, capital expenditures and discount rates.

The estimates and assumptions used consider historical performance if indicative of future performance and are consistent with the assumptions used in determining future profit plans for the reporting units.

1 unchanged sentence

Changes in these inputs, including as a result of events beyond our control, could materially affect the results of the impairment review.

If the forecasted cash flows or other key inputs are negatively revised in the future, the estimated fair value of the reporting unit could be adversely impacted, potentially leading to an impairment in the future that could materially affect our operating results.

The Jefferson Terminal reporting unit had an estimated fair value that exceeded its carrying value by more than 10% but less than 20% as of October 1, 2022.

The Jefferson Terminal reporting unit forecasted revenue is dependent on the ramp up of volumes under current and expected future contracts for storage and throughput of heavy and light crude and refined products, expansion of refined product distribution to Mexico and movements in future oil spreads.

At October 1, 2022, approximately 4.3 million barrels of storage was operational with 1.9 million

If the forecasted cash flows or other key inputs are negatively revised in the future, the estimated fair value of the reporting unit could be adversely impacted, potentially leading to

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

barrels under construction for new contracts that came online in December 2022 which completed our storage development for our main terminal.

an impairment in the future that could materially affect our operating results.

The Jefferson Terminal reporting unit had an estimated fair value that exceeded its carrying value by more than 10% but less than 20% as of October 1, 2023.

At October 1, 2023, approximately 6.2 million barrels of storage was operational.

Our discount rate for our 2023 goodwill impairment analysis was 10.3 % and our assumed terminal growth rate was 2.5 %.

If our strategy changes from planned capacity downward due to an inability to source contracts or expand volumes, the fair value of the reporting unit would be negatively affected, which could lead to an impairment.

The expansion of refineries in the Beaumont/Port Arthur area, as well as growing crude oil production in the U.S.

The expansion of refineries in the Beaumont/Port Arthur area, as well as growing crude oil and natural gas production in the U.S.

and Canada, are expected to result in increased demand for storage on the U.S.

1 unchanged sentence

We expect the Jefferson Terminal reporting unit to continue to generate positive Adjusted EBITDA in future years.

In December 2022, our multi-year refined products contract with Exxon Mobil Oil Corporation commenced.

Although certain of our anticipated contracts or expected volumes from existing contracts for Jefferson Terminal have been delayed, we continue to believe our projections are achievable.

Further delays in executing anticipated contracts or achieving our projected volumes could adversely affect the fair value of the reporting unit.

There were no impairments of goodwill for the three and nine months ended September 30, 2023 and 2022.

Intangibles and Amortization — Intangible assets include the value of existing customer relationships acquired in connection with the acquisition of Jefferson Terminal and Transtar.

Customer relationship intangible assets are amortized on a straight-line basis over their useful lives as the pattern in which the asset’s economic benefits are consumed cannot reliably be determined.

Customer relationship intangible assets have useful lives ranging from 5 to 15 years, no estimated residual value, and amortization is recorded as a component of Depreciation and amortization in the Consolidated and Combined Consolidated Statements of Operations.

The weighted-average remaining amortization period for customer relationships was 144 months and 148 months as of September 30, 2023 and December 31, 2022, respectively.

There were no impairments of goodwill for the three months ended March 31, 2024 and 2023.

Redeemable Preferred Stock — We classify the Series A Senior Preferred Stock ("Redeemable Preferred Stock") as temporary equity in the Consolidated Balance Sheets due to certain contingent redemption clauses that are at the election of the holders.

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Deferred Financing Costs — Costs incurred in connection with obtaining long-term financing are capitalized and amortized to interest expense over the term of the underlying loans .

Unamortized deferred financing costs of $ 33.1 million and $ 30.9 million as of September 30, 2023 and December 31, 2022, respectively, are included in Debt, net in the Consolidated Balance Sheets.

Amortization expense was $ 1.8 million and $ 1.3 million during the three months ended September 30, 2023 and 2022, respectively, and $ 4.9 million and $ 3.0 million during the nine months ended September 30, 2023 and 2022, respectively, and is included in Interest expense in the Consolidated and Combined Consolidated Statements of Operations.

Unamortized deferred financing costs of $ 29.4 million and $ 31.3 million as of March 31, 2024 and December 31, 2023, respectively, are included in Debt, net in the Consolidated Balance Sheets.

Amortization expense was $ 1.9 million and $ 1.4 million during the three months ended March 31, 2024 and 2023, respectively, and is included in Interest expense in the Consolidated Statements of Operations.

Terminal Services Revenues — Terminal services are provided to customers for the receipt and redelivery of various commodities.

16 unchanged sentences

Lease income is recognized on a straight-line basis over the terms of the relevant lease agreement.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Roadside Services Revenues — Roadside services revenue is revenue related to providing roadside assistance services to customers in the intermodal and over-the-road trucking industries.

1 unchanged sentence

Revenues are typically invoiced for each repair and generally have 30-day payment terms.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Other Revenue — Other revenue primarily consists of revenue related to the handling, storage and sale of raw materials.

4 unchanged sentences

Other revenues are typically invoiced and paid on a monthly basis.

Additionally, other revenue includes revenue related to derivative trading activities.

Payment terms for revenues are generally short term in nature .

14 unchanged sentences

We attempt to limit our credit risk by performing ongoing credit evaluations.

We earned approximately 55 % and 52 %, respectively, of total revenues for the three and nine months ended September 30, 2023 from one customer in the Railroad segment.

Additionally, we earned 12 % and 11%, respectively, of total revenues for the three and nine months ended September 30, 2023 from one customer in the Jefferson Terminal segment.

We earned 44 % and 54 %, respectively, of total revenues for the three and nine months ended September 30, 2022 from one customer in the Railroad segment.

We earned 10 % of total revenues for both the three and nine months ended September 30, 2022 from one customer in the Jefferson Terminal segment.

As of September 30, 2023 accounts receivable from three customers within the Jefferson Terminal and Railroad segments represented 53 % of total accounts receivable, net.

We earned approximately 51 % of total revenues for the three months ended March 31, 2024 from one customer in the Railroad segment.

Additionally, we earned 14 % of total revenues for the three months ended March 31, 2024 from one customer in the Jefferson Terminal segment.

We earned 48 % of total revenues for the three months ended March 31, 2023 from one customer in the Railroad segment.

We earned 12 % of total revenues for the three months ended March 31, 2023 from one customer in the Jefferson Terminal segment.

As of March 31, 2024, accounts receivable from two customers within the Jefferson Terminal and Railroad segments represented 54 % of total accounts receivable, net.

As of December 31, 2023, accounts receivable from three customers within the Jefferson Terminal and Railroad segments represented 56 % of total accounts receivable, net.

3 unchanged sentences

We also consider current and future economic conditions over the expected lives of the receivables, the amount of receivables in dispute, and the current receivables aging.

Expense Recognition — Expenses are recognized on an accrual basis as incurred.

Acquisition and Transaction expenses — Acquisition and transaction expense is comprised of costs related to business combinations, dispositions and terminated deal costs related to asset acquisitions, including advisory, legal, accounting, valuation and other professional or consulting fees.

Comprehensive (Loss) Income — Comprehensive (loss) income is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances, excluding those resulting from investments by and distributions to owners.

Our comprehensive (loss) income represents net loss, as presented in the Consolidated Statements of Operations, adjusted for fair value changes recorded in other comprehensive (loss) income related to cash flow hedges of our equity method investees and changes in pension and other employee benefit accounts.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Our comprehensive (loss) income represents net loss, as presented in the Consolidated and Combined Consolidated Statements of Operations, adjusted for fair value changes recorded in other comprehensive income (loss) related to cash flow hedges of our equity method investees and pension and other employee benefit accounts.

Derivative Financial Instruments

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Certain of these derivative instruments are designated and qualify as cash flow hedges.

Our share of the derivative's gain or loss is reported as Other comprehensive income (loss) related to equity method investees, net in our Consolidated and Combined Consolidated Statements of Comprehensive (Loss) Income and recorded in Accumulated other comprehensive loss in our Consolidated Balance Sheets.

The change in our equity method investment balance related to derivative gains or losses on cash flow hedges is disclosed as a Non-cash change in equity method investment in our Consolidated and Combined Consolidated Statements of Cash Flows.

Our share of the derivative's gain or loss is reported as Other comprehensive (loss) income related to equity method investees in our Consolidated Statements of Comprehensive (Loss) Income and recorded in Accumulated other comprehensive loss in our Consolidated Balance Sheets.

Derivatives Not Designated As Hedging Instruments

Certain of these derivative instruments are not designated as hedging instruments for accounting purposes.

Our share of the change in fair value of these contracts is recognized in Equity in earnings (losses) of unconsolidated entities in the Consolidated and Combined Consolidated Statements of Operations.

The cash flow impact of derivative contracts that are not designated as hedging instruments is recognized in Equity in (losses) earnings of unconsolidated entities in our Consolidated and Combined Consolidated Statements of Cash Flows.

Income Taxes — Prior to the spin-off, we were taxed as a disregarded entity for U.S.

federal income tax purposes and our taxable income or loss generated was allocated to investors by our Former Parent, which was treated as a partnership for U.S.

federal income tax purposes.

In addition, certain of our subsidiaries were taxed as separate corporations for U.S.

federal income tax purposes.

The income tax provision included in the consolidated and combined consolidated financial statements prior to the spin-off was prepared on a separate return method.

Post spin-off, FTAI Infrastructure’s tax structure, certain return elections and assertions are different, including a single consolidated federal tax filing in the U.S., and therefore the income taxes presented prior to the spin-off in the consolidated and combined consolidated financial statements are not expected to be indicative of the Company’s future income taxes.

Our share of the change in fair value of these contracts is recognized in Equity in (losses) earnings of unconsolidated entities in the Consolidated Statements of Operations.

The cash flow impact of derivative contracts that are not designated as hedging instruments is recognized in Equity in losses (earnings) of unconsolidated entities in our Consolidated Statements of Cash Flows.

Income Taxes — Taxable income or loss generated by us and our corporate subsidiaries is subject to U.S.

federal, state and foreign corporate income tax in locations where they conduct business.

We account for these taxes using the asset and liability method under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

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We recognize tax benefits for uncertain tax positions only if it is more likely than not that the position is sustainable based on its technical merits.

Interest and penalties on uncertain tax positions are included as a component of the provision for income taxes in the Consolidated and Combined Consolidated Statements of Operations.

Interest and penalties on uncertain tax positions are included as a component of the Provision for income taxes in the Consolidated Statements of Operations.

Pension and Other Postretirement Benefits — We have obligations for a pension and a postretirement benefit plan in connection with the acquisition of Transtar for certain eligible Transtar employees.

4 unchanged sentences

Refer to Note 11 for additional discussion on the pension and postretirement benefit plans.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

LEASING EQUIPMENT, NET

LEASING EQUIPMENT, NET AND PROPERTY

Leasing equipment, net is summarized as follows:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Leasing equipment $ 46,370 $ 45,982

2 unchanged sentences

Depreciation expense for leasing equipment is summarized as follows:

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Depreciation expense for leasing equipment $ 331 $ 276

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Sales-Type Leases

In December 2023, Jefferson Terminal entered into an agreement to lease land to an entity controlled by an affiliate of the Manager.

The lease is initially for a two-year construction period and eight years post-completion with renewals that extend the lease up to 32 years.

We determined that the lease is a sales-type lease as the present value of the lease payments is substantially all of fair value.

Lease payments will increase based on an inflation escalator and be treated as variable lease payments as they occur.

At lease commencement, we recorded $ 6.6 million of gain on sales-type lease which is recorded in Gain (loss) on sale of assets in the Consolidated Statements of Operations during the year ended December 31, 2023.

We also recorded $ 0.2 million of interest income which is included in Revenues in the Consolidated Statements of Operations during the three months ended March 31, 2024.

PROPERTY, PLANT AND EQUIPMENT, NET

Property, plant and equipment, net is summarized as follows:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Land, site improvements and rights $ 182,349 $ 182,319

13 unchanged sentences

Depreciation expense for property, plant and equipment is summarized as follows:

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Depreciation expense $ 18,304 $ 17,973

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The following table presents the ownership interests and carrying values of our investments:

Carrying Value

Investment Ownership Percentage September 30, 2023 December 31, 2022

Investment Ownership Percentage March 31, 2024 December 31, 2023

Intermodal Finance I, Ltd.

2 unchanged sentences

Equity method 50.1 % — —

Long Ridge West Virginia LLC Equity method 50.1 % 6,713 6,825

GM-FTAI Holdco LLC Equity method See below 51,255 55,740

2 unchanged sentences

________________________________________________________

(1) The carrying value of $( 7.8 ) million and $( 187.2 ) million as of September 30, 2023 and December 31, 2022 is included in Other liabilities in the Consolidated Balance Sheets.

We did not recognize any other-than-temporary impairments for the three and nine months ended September 30, 2023 and 2022.

The following table presents our proportionate share of equity in earnings (losses):

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

(1) The carrying value of $( 54.8 ) million and $( 29.3 ) million as of March 31, 2024 and December 31, 2023, respectively, is included in Other liabilities in the Consolidated Balance Sheets.

We did not recognize any other-than-temporary impairments for the three months ended March 31, 2024 and 2023.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The following table presents our proportionate share of equity in (losses) earnings:

Three Months Ended March 31,

Intermodal Finance I, Ltd.

$ 10 $ 33 $ 44 $ 121

Long Ridge Energy & Power LLC ( 6,675 ) 7,761

Long Ridge West Virginia LLC ( 362 ) —

GM-FTAI Holdco LLC ( 4,486 ) ( 2,341 )

9 unchanged sentences

We do not have a variable interest in this investment as none of the criteria of ASC 810-10-15-14 were met.

As of September 30, 2023, Intermodal owns a portfolio of approximately 211 shipping containers subject to multiple operating leases.

As of March 31, 2024, Intermodal owns a portfolio of approximately 173 shipping containers subject to multiple operating leases.

Long Ridge Energy & Power LLC

3 unchanged sentences

In addition to our equity method investment, in October 2022 we entered into a shareholder loan agreement maturing on October 15, 2023 and accruing paid-in-kind (“PIK”) interest at a 13 % rate.

The Company made an additional $ 51.0 million of investment in Long Ridge as part of the shareholder loan agreement during the nine months ended September 30, 2023.

As of September 30, 2023, the balance of the note receivable was $ 83.5 million recorded as part of the Long Ridge investment in Other liabilities on the Consolidated Balance Sheet.

During 2023, the maturity date was extended to May 1, 2032.

As of March 31, 2024 and December 31, 2023, the balance of the note receivable was $ 73.3 million and $ 71.0 million, respectively, recorded as part of the Long Ridge investment in Other liabilities on the Consolidated Balance Sheets.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The tables below present summarized financial information for Long Ridge Energy & Power LLC:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Balance Sheet

2 unchanged sentences

Restricted cash 20,455 23,691

Accounts receivable 7,730 31,727

Accounts receivable, net

Other current assets 6,226 7,357

Total current assets 36,918 40,043

Property plant & equipment 834,745 827,886

Intangible assets 4,275 4,560

Property, plant, and equipment, net

825,901 828,232

Intangible assets, net

Goodwill 86,460 86,460

11 unchanged sentences

Total liabilities 1,211,531 1,161,038

Shareholders' equity ( 32,209 ) ( 273,597 )

Accumulated deficit ( 150,108 ) ( 154,784 )

Total equity ( 253,584 ) ( 198,082 )

Total liabilities and equity $ 957,947 $ 962,956

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Income Statement 2024 2023

Total revenue $ 29,208 $ 27,277 $ 132,067 $ 42,320

$ 29,306 $ 56,405

Operating expenses 13,860 13,214

2 unchanged sentences

Total expenses 42,649 41,018

Total other income (expense) ( 24 ) 11 207 ( 202 )

Total other (expense) income

Net (loss) income

1 unchanged sentence

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

9 unchanged sentences

On June 15, 2022, we exchanged our Class B shares which gave us economic interest in Aleon for an additional 20 % interest in Class A shares.

In addition, we also terminated our credit agreements with GMR and Aleon in exchange for an approximate 8.5 % of additional interest in Class A shares.

In addition, we also terminated our credit agreements with GMR and Aleon in exchange for an approximate 8.5 % of additional interest in Class A shares of GM-FTAI Holdco LLC.

As a result of these exchange transactions, we own approximately 27 % of GM-FTAI Holdco LLC, which owns 100 % of both GMR and Aleon.

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We account for our investment in CPE as an equity method investment as we have significant influence through our ownership of Class A shares.

Long Ridge West Virginia LLC

In November 2023, we sold a 49.9 % interest in Long Ridge West Virginia LLC (“Long Ridge WV”), previously a wholly owned subsidiary, for $ 7.5 million in cash.

Long Ridge WV is a VIE as defined in U.S.

GAAP, but we are not the primary beneficiary.

Following the sale, we no longer have a controlling interest in Long Ridge WV, but we still maintain significant influence through our retained interest and account for this investment in accordance with the equity method.

Long Ridge WV was formed to build an energy generating property in West Virginia similar to that of Long Ridge Energy & Power LLC.

On the deconsolidation, no gain was recorded as all the assets consist of unproved undeveloped gas properties.

We recorded our investment in the legal entity at the cost basis of $ 7.2 million as of November 17, 2023.

Equity Investments

FYX Trust Holdco LLC

In July 2020, we invested $ 1.3 million for a 14 % interest in an operating company that provides roadside assistance services for the intermodal and over-the-road trucking industries.

FYX Trust Holdco LLC (“FYX”) has developed a mobile and web-based application that connects fleet managers, owner-operators, and drivers with repair vendors to efficiently and reliably quote, dispatch, monitor, and bill roadside repair services.

In May 2022, we purchased an additional 51 % interest in FYX from an unrelated third party for a purchase price of $ 4.6 million, which resulted in our ownership of a majority stake in the entity.

In March 2023, we purchased the remaining non-controlling interest of FYX from an affiliate of our Manager for a purchase price of $ 4.4 million.

This resulted in 100 % ownership in FYX and the elimination of any non-controlling interest.

From the initial consolidation date in May 2022 through and as of September 30, 2023, FYX is presented on a consolidated basis in the Consolidated and Combined Consolidated Statements of Operations and the Consolidated Balance Sheets.

E-Circuit Motors, Inc.

E-Circuit Motors Inc.

(“ECM”) is a software company concentrating on the development and sale of printer circuit board stator motors and also utilizes proprietary software to develop and test such motors in a virtual environment.

On March 6, 2024, the Company invested $ 5.0 million for 166,667 shares of Series D preferred equity, as well as 166,667 warrants of common stock at $ 0.01 per share in ECM.

The preferred shares are convertible to common shares at the option of the investor on a one -for-one basis.

We do not exercise significant influence over the investment and will record the preferred share investment as an equity security.

The warrants are exercisable only if certain conditions are met over the next two years after the date of the investment.

The warrants will be accounted for as equity securities.

The value of the Series D preferred equity and warrants as of the date of investment were determined to be $ 2.5 million each, based on relative fair value.

ECM is a private company with no readily determinable fair values;

if additional third-party information becomes available we will adjust the value of the investments accordingly.

As of March 31, 2024, the investment of $ 5.0 million was recorded in Other assets on the Consolidated Balance Sheet.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

INTANGIBLE ASSETS, NET

Intangible assets, net are summarized as follows:

September 30, 2023

March 31, 2024

Jefferson Terminal Railroad Total

Intangible assets

Customer relationships $ 35,513 $ 60,000 $ 95,513

3 unchanged sentences

Jefferson Terminal Railroad Total

Intangible assets

Customer relationships $ 35,513 $ 60,000 $ 95,513

1 unchanged sentence

Intangible assets, net $ 2,368 $ 50,253 $ 52,621

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Amortization of customer relationships is included in Depreciation and amortization in the Consolidated and Combined Consolidated Statements of Operations and is as follows:

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Amortization of customer relationships is included in Depreciation and amortization in the Consolidated Statements of Operations and is as follows:

Three Months Ended March 31,

Amortization of customer relationships $ 1,886 $ 1,886

As of September 30, 2023, estimated net annual amortization of intangibles is as follows:

As of March 31, 2024, estimated net annual amortization of intangibles is as follows:

Remainder of 2024

1 unchanged sentence

Total $ 50,735

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Our debt, net is summarized as follows:

Outstanding Borrowings

Stated Interest Rate Maturity Date September 30, 2023 December 31, 2022

Stated Interest Rate Maturity Date March 31, 2024 December 31, 2023

Loans payable

1 unchanged sentence

(i) Base Rate + 2.75 %;

(ii) Base Rate + 3.75 % (Term SOFR)

(ii) Base Rate + 3.75 % (Term Secured Overnight Financing Rate (“SOFR”))

11/5/26 $ 44,250 $ 44,250

1 unchanged sentence

(ii) 11/26/27 63,800 63,800

Transtar Revolver (2)

(i) Base Rate + 2.00 %;

(ii) Adjusted Term SOFR + 3.00 %

12/27/25 — 10,000

Total loans payable 108,050 108,050

12 unchanged sentences

Total bonds payable 1,265,587 1,264,161

Total Debt 1,351,580 1,261,008

1,373,637 1,372,211

Debt issuance costs ( 29,448 ) ( 31,301 )

3 unchanged sentences

(1) Requires a quarterly commitment fee at a rate of 1.000 % on the average daily unused portion, as well as customary letter of credit fees and agency fees.

(2) Required a quarterly commitment fee at a rate of 0.500 % on the average daily unused portion, as well as customary letter of credit fees and agency fees.

(3) Includes an unamortized discount of $ 26,200 and $ 25,172 at September 30, 2023 and December 31, 2022, respectively.

Credit Agreement

On May 18, 2023, we entered into a credit agreement, providing for a $ 25.0 million secured loan facility (the “Credit Agreement”).

In July 2023, we issued an additional $ 100.0 million aggregate principal amount of 10.500 % Senior Notes due 2027 (see below), and used a portion of the net proceeds to repay the Credit Agreement in full.

We recognized a loss on extinguishment of debt of $1.1 million.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Transtar Revolver

On December 27, 2022, our subsidiary entered into a revolving credit facility (the “Transtar Revolver”) that provided for revolving loans in the aggregate amount of $ 25.0 million.

In January 2023, our subsidiary entered into an amendment to the Transtar Revolver for an additional $ 25.0 million, for a total facility of $ 50.0 million.

In July 2023, we issued an additional $ 100.0 million aggregate principal amount of 10.500 % Senior Notes due 2027 (see below), and used a portion of the net proceeds to repay in full and terminate the Transtar Revolver.

We recognized a loss on extinguishment of debt of $0.9 million.

Senior Notes Due 2027

On July 5, 2023, we issued an additional $ 100.0 million aggregate principal amount of 10.500 % Senior Notes due 2027, at an issue price equal to 95.50 % of principal, plus accrued interest from and including June 1, 2023.

These notes have identical terms as the original Senior Notes due 2027, other than with respect to the date of issuance and the issue price, and bear interest at a rate of 10.500 % per annum, payable semi-annually in arrears on June 1 and December 1 of each year.

We were in compliance with all debt covenants as of September 30, 2023.

(2) Includes an unamortized discount of $ 23,393 and $ 24,819 at March 31, 2024 and December 31, 2023, respectively.

We were in compliance with all debt covenants as of March 31, 2024.

FAIR VALUE MEASUREMENTS

9 unchanged sentences

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The following tables set forth our financial assets measured at fair value on a recurring basis as of September 30, 2023 and December 31, 2022, by level within the fair value hierarchy.

The following tables set forth our financial assets measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023, by level within the fair value hierarchy.

Assets measured at fair value are classified in their entirety based on the lowest level of input that is significant to their fair value measurement.

Fair Value as of Fair Value Measurements Using Fair Value Hierarchy as of

September 30, 2023 September 30, 2023

March 31, 2024 March 31, 2024

Total Level 1 Level 2 Level 3 Valuation Technique

1 unchanged sentence

Restricted cash 41,328 41,328 — — Market

Note receivable 10,800 — 10,800 — Market

Notes receivable 11,664 — 11,664 — Market

Total assets $ 75,960 $ 64,296 $ 11,664 $ —

4 unchanged sentences

Restricted cash 58,112 58,112 — — Market

Derivative assets 1,125 — 1,125 — Income

Total $ 150,767 $ 149,642 $ 1,125 $ —

Notes receivable 11,664 — 11,664 — Market

$ 99,143 $ 87,479 $ 11,664 $ —

Our cash and cash equivalents and restricted cash consist largely of demand deposit accounts with maturities of 90 days or less when purchased that are considered to be highly liquid.

These instruments are valued using inputs observable in active markets for identical instruments and are therefore classified as Level 1 within the fair value hierarchy.

The fair value of our commodity derivative assets that are classified as Level 2 measurements are estimated by applying the income and market approaches, based on quotes of observable market transactions, and adjusted for estimated differential factors based on quality and delivery locations.

Except as discussed below, our financial instruments other than cash and cash equivalents and restricted cash consist principally of accounts receivable, notes receivable, accounts payable and accrued liabilities, loans payable, and management fees payable, whose fair values approximate their carrying values based on an evaluation of pricing data, vendor quotes, and historical trading activity or due to their short maturity profiles.

The fair value of our bonds and notes payable reported as debt, net in the Consolidated Balance Sheets are presented in the table below:

September 30, 2023 December 31, 2022

The fair value of our commodity derivative assets that are classified as Level 2 measurements are estimated by applying the market approach, based on quotes of observable market transactions, and adjusted for estimated differential factors based on quality and delivery locations.

Except as discussed below, our financial instruments other than cash and cash equivalents, restricted cash and the CarbonFree note receivable consist principally of accounts receivable, notes receivable, accounts payable and accrued liabilities, and loans payable, whose fair values approximate their carrying values due to their short maturity profiles.

The fair value of our bonds, notes and loans payable reported as Debt, net in the Consolidated Balance Sheets are presented in the table below:

March 31, 2024 December 31, 2023

Series 2020 A Bonds (1)

7 unchanged sentences

Senior Notes due 2027 625,746 625,038

EB-5 Loan Agreement 21,578 21,240

EB-5.2 Loan Agreement 8,279 8,183

EB-5.3 Loan Agreement 22,488 22,491

________________________________________________________

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FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

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We have elected to exclude sales and other similar taxes from revenues.

Three Months Ended September 30, 2023

Ports and Terminals

Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total

Lease income $ 394 $ 343 $ — $ — $ — $ — $ 737

Rail revenues 41,470 — — — — — 41,470

Terminal services revenues — 16,267 4,087 — — — 20,354

Roadside services revenues — — — — — 18,145 18,145

Other revenue — — — — — — —

Total revenues $ 41,864 $ 16,610 $ 4,087 $ — $ — $ 18,145 $ 80,706

Nine Months Ended September 30, 2023

Ports and Terminals

Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total

Lease income $ 1,231 $ 968 $ — $ — $ — $ — $ 2,199

Rail revenues 124,184 — — — — — 124,184

Terminal services revenues — 51,838 8,532 — — — 60,370

Roadside services revenues — — — — — 54,230 54,230

Other revenue — — ( 1,951 ) — — — ( 1,951 )

Total revenues $ 125,415 $ 52,806 $ 6,581 $ — $ — $ 54,230 $ 239,032

Three Months Ended September 30, 2022

Three Months Ended March 31, 2024

Ports and Terminals

Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total

Railroad Jefferson Terminal Repauno Corporate and Other Total

Lease income $ 411 $ 797 $ — $ — $ 1,208

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Total revenues $ 46,312 $ 18,616 $ 4,079 $ 13,528 $ 82,535

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

Ports and Terminals

Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total

Railroad Jefferson Terminal Repauno Corporate and Other Total

Lease income $ 437 $ 306 $ — $ — $ 743

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Total revenues $ 41,005 $ 19,092 $ ( 1,453 ) $ 17,850 $ 76,494

Presented below are the contracted minimum future annual revenues to be received under existing operating leases within the Jefferson Terminal segment as of September 30, 2023:

Operating Leases

Remainder of 2023 $ 3,296

Total $ 53,457

As of March 31, 2024 and December 31, 2023, we recorded capitalized contract cost of $ 27.4 million and $ 19.8 million, of which $ 2.5 million and $ 2.2 million is included in Other current assets and $ 24.9 million and $ 17.6 million is included in Other assets on the Consolidated Balance Sheets, respectively.

During the three months ended March 31, 2024, the Company recognized revenue of $ 0.3 million that was included in the deferred revenue balance at the beginning of the year.

EQUITY-BASED COMPENSATION

On August 1, 2022, we established a Nonqualified Stock Option and Incentive Award Plan (“Incentive Plan”) which provides for the ability to grant equity compensation awards in the form of stock options, stock appreciation rights, restricted stock, and performance awards to eligible employees, consultants, directors, and other individuals who provide services to us, each as determined by the Compensation Committee of the board of directors.

As of September 30, 2023, the Incentive Plan provides for the issuance of up to 30.0 million shares.

We account for equity-based compensation expense in accordance with ASC 718, Compensation-Stock Compensation and report within operating expenses and general and administrative expenses in the Consolidated and Combined Consolidated Statements of Operations.

Director Compensation

During the nine months ended September 30, 2023, we issued 25,479 shares of common stock to certain directors as compensation.

During the nine months ended September 30, 2023, the Manager transferred 2,173,914 of its op tions to certain employees of the Manager.

As of March 31, 2024, the Incentive Plan provides for the issuance of up to 30.0 million shares.

We report equity-based compensation expense within Operating expenses and General and administrative in the Consolidated Statements of Operations.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Subsidiary Stock-Based Compensation

The following table presents the expense related to our subsidiary stock-based compensation arrangements:

Expense Recognized During the Three Months Ended September 30, Expense Recognized During the Nine Months Ended September 30, Remaining Expense To Be Recognized, If All Vesting Conditions Are Met Weighted Average Remaining Contractual Term (in years)

2023 2022 2023 2022

The following table presents the expense related to our subsidiary stock-based compensation arrangements recognized in the Consolidated Statements of Operations:

Expense Recognized During the Three Months Ended March 31,

Remaining Expense To Be Recognized, If All Vesting Conditions Are Met Weighted Average Remaining Contractual Term (in years)

Restricted shares $ — $ 444 $ — 0.0

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Restricted Stock Units to Subsidiary Employees

During the nine months ended September 30, 2023, we issued restricted stock units (“RSUs”) of our common stock that had a grant date fair value of $ 16.9 million, based on the closing price of FIP’s stock on the grant date, and vest over three years.

These awards were made to employees of certain of our subsidiaries, are subject to continued employment, and the

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

compensation expense is recognized ratably over the vesting periods.

During the year ended December 31, 2023, we issued restricted stock units (“RSUs”) of our common stock that had a grant date fair value of $ 16.9 million, based on the closing price of FIP’s stock on the grant date, and vest over three years.

These awards were made to employees of certain of our subsidiaries, are subject to continued employment, and the compensation expense is recognized ratably over the vesting periods.

This grant fully canceled and replaced the vested and unvested restricted shares of our subsidiary issued in the first quarter of 2021.

The following table presents the expense related to our restricted stock units to subsidiary employees:

2023 2022 2023 2022

The following table presents the expense related to our restricted stock units to subsidiary employees recognized in the Consolidated Statements of Operations:

Expense Recognized During the Three Months Ended March 31,

Remaining Expense To Be Recognized, If All Vesting Conditions Are Met Weighted Average Remaining Contractual Term (in years)

Restricted stock units $ 2,050 $ — $ 5,285 1.2

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RETIREMENT BENEFIT PLANS

In connection with the acquisition of Transtar, we established a defined benefit pension plan as well as a postretirement benefit plan to assume certain retirement benefit obligations related to eligible Transtar employees.

We established a defined benefit pension plan as well as a postretirement benefit plan to assume certain retirement benefit obligations related to eligible Transtar employees.

Defined Benefit Pensions

Our underfunded pension plan is a tax qualified plan.

Our pension plan covers certain eligible Transtar employees.

These plans are noncontributory.

Our underfunded pension plan is a tax qualified plan, and we will make contributions accordingly.

Our pension plan covers certain eligible Transtar employees and is noncontributory.

Pension benefits earned are generally based on years of service and compensation during active employment.

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The following table summarizes our retirement benefit plan costs.

Service costs are recorded in Operating expenses, while interest and amortization costs are recorded in Other (expense) income within the Consolidated and Combined Consolidated Statements of Operations.

Three Months Ended September 30,

Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits

Service costs $ 348 $ 446 $ 438 $ 538

Interest costs 117 374 74 225

Amortization of prior service costs — 34 — —

Amortization of actuarial gains ( 46 ) — — —

Total $ 419 $ 854 $ 512 $ 763

Nine Months Ended September 30,

Service costs are recorded in Operating expenses, while other net costs are recorded in Other income within the Consolidated Statements of Operations.

Three Months Ended March 31,

Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits

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Interest costs 154 409 117 374

Expected return on plan assets

Amortization of prior service costs — 40 — 34

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Total $ 474 $ 933 $ 419 $ 854

The total employer contributions for the nine months ended September 30, 2023 and 2022 was $ 1.5 million and $ 1.4 million, respectively, and there are no expected remaining scheduled employer contributions for the year ending December 31, 2023.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The current and deferred components of the income tax provision included in the Consolidated and Combined Consolidated Statements of Operations are as follows:

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

The total employer contributions for the three months ended March 31, 2024 and 2023 was $ 0.7 million and $ 0.3 million, respectively, and the expected remaining scheduled employer contributions for the year ending December 31, 2024 is $ 1.2 million.

The current and deferred components of the income tax provision included in the Consolidated Statements of Operations are as follows:

Three Months Ended March 31,

Federal $ — $ —

State and local 468 182

Foreign — — — —

Total current provision 468 182

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State and local 399 730

Foreign — — — —

Total deferred provision 1,337 1,547

Provision for income taxes $ 1,805 $ 1,729

Prior to the spin-off, we were taxed as a disregarded entity for U.S.

federal income tax purposes and our taxable income or loss generated was allocated to investors by our Former Parent, which was treated as a partnership for U.S.

federal income tax purposes.

In addition, certain of our subsidiaries were taxed as separate corporations for U.S.

federal income tax purposes.

Taxable income or loss generated by us and our corporate subsidiaries following the spin-off and by our corporate subsidiaries is subject to U.S.

Taxable income or loss generated by us and our corporate subsidiaries by our corporate subsidiaries is subject to U.S.

federal, state and foreign corporate income tax in locations where they conduct business.

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federal tax rate of 21 % primarily due to state taxes and the valuation allowances against a significant portion of the deferred tax assets of our corporate subsidiaries.

As of and for the nine months ended September 30, 2023, we had not established a liability for uncertain tax positions as no such positions existed.

As of and for the three months ended March 31, 2024, we had not established a liability for uncertain tax positions as no such positions existed.

In general, our tax returns and the tax returns of our corporate subsidiaries are subject to U.S.

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Generally, we are not subject to examination by taxing authorities for tax years prior to 2020.

We do not believe that it is reasonably possible that the total amount of unrecognized tax benefits will significantly change within 12 months of the reporting date of September 30, 2023.

We do not believe that it is reasonably possible that the total amount of unrecognized tax benefits will significantly change within 12 months of the reporting date of March 31, 2024.

MANAGEMENT AGREEMENT AND AFFILIATE TRANSACTIONS

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Pre-incentive allocation net income does not include any Income Incentive Fee or Capital Gains Incentive Fee (described below) paid to the Manager during the relevant quarter.

The Manager is entitled to an Income Incentive Fee with respect to its pre-incentive fee net income in each calendar quarter as follows:

(1) no Income Incentive Fee in any calendar quarter in which pre-incentive fee net income, expressed as a rate of return

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The Manager is entitled to an Income Incentive Fee with respect to its pre-incentive fee net income in each calendar quarter as follows:

(1) no Income Incentive Fee in any calendar quarter in which pre-incentive fee net income, expressed as a rate of return on the average value of the Company’s net equity capital (excluding non-controlling interests) at the end of the two most recently completed calendar quarters, does not exceed 2 % for such quarter ( 8 % annualized);

on the average value of the Company’s net equity capital (excluding non-controlling interests) at the end of the two most recently completed calendar quarters, does not exceed 2 % for such quarter ( 8 % annualized);

(2) 100 % of pre-incentive fee net income of the Company with respect to that portion of such pre-incentive fee net income, if any, that equals or exceeds 2 % but does not exceed 2.2223 % for such quarter;

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These calculations will be prorated for any periods of less than three months.

Capital Gains Incentive Fee is calculated and paid in arrears as of the end of each calendar year and is equal to 10 % of our pro rata share of cumulative realized gains from the date of the spin-off through the end of the applicable calendar year, net of our pro rata share of cumulative realized or unrealized losses, the cumulative non-cash portion of equity-based compensation expenses and all realized gains upon which prior performance-based Capital Gains Incentive Fee payments were made to the Manager.

The management fee, Income Incentive Fee, and Capital Gains Incentive Fee that are attributable to the operations of FTAI Infrastructure is recorded in the Management fees and incentive allocation to affiliate on the Consolidated and Combined Consolidated Statements of Operations.

The Capital Gains Incentive Fee is calculated and paid in arrears as of the end of each calendar year and is equal to 10 % of our pro rata share of cumulative realized gains from the date of the spin-off through the end of the applicable calendar year, net of our pro rata share of cumulative realized or unrealized losses, the cumulative non-cash portion of equity-based compensation expenses and all realized gains upon which prior performance-based Capital Gains Incentive Fee payments were made to the Manager.

These amounts are allocated on the following basis:

Management fee —Management fee is allocated to FTAI Infrastructure by applying the calculation methodology described above to the equity of FTAI Infrastructure included in these consolidated and combined consolidated financial statements.

Income Incentive Allocation and Capital Gains Incentive Allocation —The Income Incentive Allocation and Capital Gains Incentive Allocation are allocated to FTAI Infrastructure by applying the allocation calculation methodology described above to FTAI Infrastructure’s financial results in each respective period.

The following table summarizes the management fees, income incentive allocation and capital gains incentive allocation included in these consolidated and combined consolidated financial statements:

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Income Incentive Allocation and Capital Gains Incentive Allocation —The Income Incentive Fee and Capital Gains Incentive Fee are allocated to FTAI Infrastructure by applying the allocation calculation methodology described above to FTAI Infrastructure’s financial results in each respective period.

The following table summarizes the management fees, income incentive allocation and capital gains incentive allocation included in these consolidated financial statements:

Three Months Ended March 31,

Management fee

$ 3,001 $ 2,982

Income incentive fee

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Total $ 3,001 $ 2,982

For periods post-spin, we pay all of our operating expenses, except those specifically required to be borne by the Manager under the Management Agreement.

For periods pre-spin, the Former Parent paid all of its operating expenses, except those specifically required to be borne by the Manager under the management agreement between the Former Parent and the Manager.

We pay all of our operating expenses, except those specifically required to be borne by the Manager under the Management Agreement.

The expenses required to be paid by the Company include, but are not limited to, issuance and transaction costs incident to the acquisition, disposition and financing of its assets, legal and auditing fees and expenses, the compensation and expenses of the Company’s independent directors, the costs associated with the establishment and maintenance of any credit facilities and other indebtedness (including commitment fees, legal fees, closing costs, etc.), expenses associated with other securities offerings, costs and expenses incurred in contracting with third parties (including affiliates of the Manager), the costs of printing and mailing proxies and reports to the stockholders, costs incurred by the Manager or its affiliates for travel on our behalf, costs associated with any computer software or hardware that is used by the Company, costs to obtain liability insurance to indemnify the Company’s directors and officers and the compensation and expenses of the transfer agent.

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we do not reimburse the Manager for these expenses.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The following table summarizes our reimbursements to the Manager:

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Classification in the Consolidated and Combined Consolidated Statements of Operations:

Three Months Ended March 31,

Classification in the Consolidated Statements of Operations:

General and administrative

$ 1,344 $ 1,863

Acquisition and transaction expenses 320 43

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If we terminate the Management Agreement, we will generally be required to pay the Manager a termination fee.

The termination fee is equal to the amount of the management fee during the 12 months immediately preceding such termination and an amount equal to the Income Incentive Fee and the Capital Gains Incentive Fee that would be paid to the Manager if the Company’s assets were sold for cash at their then current fair market value (as determined by an appraisal, taking into account, among other things, the expected future value of the underlying investments).

Upon the successful completion of an offering of our common stock or other equity securities (including securities issued as consideration in an acquisition), we grant the Manager options to purchase common stock in an amount equal to 10 % of the number of common stock being sold in the offering (or if the issuance relates to equity securities other than our common stock, options to purchase a number of common stock equal to 10 % of the gross capital raised in the equity issuance divided by the fair market value of a common stock as of the date of issuance), with an exercise price equal to the offering price per share paid by the public or other ultimate purchaser or attributed to such securities in connection with an acquisition (or the fair market value of our common stock as of the date of the equity issuance if it relates to equity securities other than our common stock).

Pursuant to the terms of the Management Agreement, the termination fee is equal to the amount of the management fee during the 12 months immediately preceding such termination and an amount equal to the Income Incentive Fee and the Capital Gains Incentive Fee that would be paid to the Manager if the Company’s assets were sold for cash at their then current fair market value (as determined by an appraisal, taking into account, among other things, the expected future value of the underlying investments).

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

Upon the successful completion of an offering of our common stock or other equity securities (including securities issued as consideration in an acquisition), we grant the Manager options to purchase common stock in an amount equal to 10 % of the number of common stock being sold in the offering (or if the issuance relates to equity securities other than our common stock, options to purchase a number of common stock equal to 10 % of the gross capital raised in the equity issuance divided by the fair market value of our common stock as of the date of issuance), with an exercise price equal to the offering price per share paid by the public or other ultimate purchaser or attributed to such securities in connection with an acquisition (or the fair market value of our common stock as of the date of the equity issuance if it relates to equity securities other than our common stock).

Any ultimate purchaser of common stock for which such options are granted may be an affiliate of Fortress.

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The following table summarizes amounts due to the Manager, which are included within Accounts payable and accrued liabilities in the Consolidated Balance Sheets:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Accrued management fees $ 3,001 $ 6,400

Other payables 1,664 5,595

As of September 30, 2023 and December 31, 2022, there were no receivables from the Manager.

As of March 31, 2024 and December 31, 2023, there w ere no receivables from the Manager.

Other Affiliate Transactions

As of September 30, 2023 and December 31, 2022, affiliates of our Manager and their related parties collectively own an approximately 20 % interest in Jefferson Terminal which has been accounted for as a component of non-controlling interest in consolidated subsidiaries in the consolidated and combined consolidated financial statements.

The carrying amount of this non-controlling interest at September 30, 2023 and December 31, 2022 was $( 71.1 ) million and $( 41.1 ) million, respectively.

As of March 31, 2024 and December 31, 2023, affiliates of our Manager and their related parties collectively own an approximately 20 % interest in Jefferson Terminal which has been accounted for as a component of non-controlling interest in consolidated subsidiaries in the consolidated financial statements.

The carrying amount of this non-controlling interest at March 31, 2024 and December 31, 2023 was $( 88.5 ) million a nd $( 78.0 ) million, respectively.

The following table presents the amount of this non-controlling interest share of net loss:

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Non-controlling interest share of net loss $ ( 10,465 ) $ ( 9,185 )

In July 2020, we purchased a 14 % interest in FYX from an affiliate of our Manager, which retained a non-controlling interest in FYX subsequent to the transaction.

In May 2022, we purchased an additional 51 % interest in FYX from an unrelated third party for a purchase price of $ 4.6 million, which resulted in our ownership of a majority stake in the entity.

In March 2023, we purchased the remaining non-controlling interest of FYX from an affiliate of our Manager for a purchase price of $ 4.4 million.

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The Company subleases a portion of office space from an entity controlled by certain principals of Fortress since February 2023.

For the three and nine months ended September 30, 2023, the Company incurred approximately $0.1 million and $ 0.3 million of rent and office related expenses, respectively.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

For the three months ended March 31, 2024 and 2023, the Company incurred approximatel y $ 0.1 million and $ 0.1 million of rent and office related expenses, respectively.

On May 22, 2023, Fortress and Mubadala Investment Company, through its wholly owned asset management subsidiary Mubadala Capital (“Mubadala”), announced that they have entered into definitive agreements pursuant to which, among other things, certain members of Fortress management and affiliates of Mubadala will acquire 100% of the equity of Fortress that is currently indirectly held by SoftBank Group Corp.

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SEGMENT INFORMATION

During the third quarter of 2022, we reorganized our historical operating segments into five operating segments as described below.

Additionally, during the third quarter of 2022, we modified our definition of Adjusted EBITDA to exclude the impact of interest costs on pension and other post-employment benefit (“OPEB”) liabilities and dividends and accretion of redeemable preferred stock.

During the first quarter of 2023 we modified our definition of Adjusted EBITDA to exclude the impact of other non-recurring items, such as severance expense and other non-cash impacts.

During the first quarter of 2023 we modified our definition of Adjusted EBITDA to exclude the impact of other non-recurring items, such as severance expense.

All segment data and related disclosures for earlier periods presented herein have been recast to reflect the new segment reporting structure.

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Our reportable segments are (i) Railroad, (ii) Jefferson Terminal, (iii) Repauno, (iv) Power and Gas and (v) Sustainability and Energy Transition.

The Railroad segment is comprised of five freight railroads and one switching company that provide rail service to certain manufacturing and production facilities, in addition to KRS, a railcar cleaning operation.

The Jefferson Terminal segment consists of a multi-modal crude oil and refined products terminal and other related assets.

The Railroad segment is comprised of six freight railroads and one switching company that provide rail service to certain manufacturing and production facilities, in addition to KRS, a railcar cleaning operation.

The Jefferson Terminal segment consists of a multi-modal crude oil and refined products terminal, Jefferson Terminal South and other related assets.

The Repauno segment consists of a 1,630 -acre deep-water port located along the Delaware River with an underground storage cavern, a new multipurpose dock, a rail-to-ship transloading system and multiple industrial development opportunities.

The Power and Gas segment is comprised of an equity method investment in Long Ridge, which is a 1,660 -acre multi-modal port located along the Ohio River with rail, dock, and multiple industrial development opportunities, including a power plant in operation.

The Power and Gas segment is comprised of an equity method investment in Long Ridge, which is a 1,660 -acre multi-modal terminal located along the Ohio River with rail, dock, and multiple industrial development opportunities, including a

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

power plant in operation.

The Sustainability and Energy Transition segment is comprised of Aleon/Gladieux, Clean Planet, and CarbonFree, and all three investments are development stage businesses focused on sustainability and recycling.

Corporate and Other primarily consists of unallocated corporate general and administrative expenses, management fees, debt and redeemable preferred stock.

Additionally, Corporate and Other includes an operating company that provides roadside assistance services for the intermodal and over-the-road trucking industries and an investment in an unconsolidated entity engaged in the acquisition and leasing of shipping containers.

Additionally, Corporate and Other includes an investment in an unconsolidated entity engaged in the acquisition and leasing of shipping containers and an operating company that provides roadside assistance services for the intermodal and over-the-road trucking industries.

The accounting policies of the segments are the same as those described in the summary of significant accounting policies.

The chief operating decision maker (“CODM”) evaluates investment performance for each reportable segment primarily based on Adjusted EBITDA.

Adjusted EBITDA is defined as net income (loss) attributable to stockholders or Former Parent, adjusted (a) to exclude the impact of provision for (benefit from) income taxes, equity-based compensation expense, acquisition and transaction expenses, losses on the modification or extinguishment of debt and capital lease obligations, changes in fair value of non-hedge derivative instruments, asset impairment charges, incentive allocations, depreciation and amortization expense, interest expense, interest and other costs on pension and OPEB liabilities, dividends and accretion on redeemable preferred stock, and other non-recurring items, (b) to include the impact of our pro-rata share of Adjusted EBITDA from unconsolidated entities, and (c) to exclude the impact of equity in earnings (losses) of unconsolidated entities and the non-controlling share of Adjusted EBITDA.

We believe that net income (loss) attributable to stockholders or Former Parent, as defined by U.S.

Adjusted EBITDA is defined as net income (loss) attributable to stockholders, adjusted (a) to exclude the impact of provision for (benefit from) income taxes, equity-based compensation expense, acquisition and transaction expenses, losses on the modification or extinguishment of debt and capital lease obligations, changes in fair value of non-hedge derivative instruments, asset impairment charges, incentive allocations, depreciation and amortization expense, interest expense, interest and other costs on pension and OPEB liabilities, dividends and accretion of redeemable preferred stock, and other non-recurring items, (b) to include the impact of our pro-rata share of Adjusted EBITDA from unconsolidated entities, and (c) to exclude the impact of equity in earnings (losses) of unconsolidated entities and the non-controlling share of Adjusted EBITDA.

We believe that net income (loss) attributable to stockholders, as defined by U.S.

GAAP, is the most appropriate earnings measure with which to reconcile Adjusted EBITDA.

Adjusted EBITDA should not be considered as an alternative to net income (loss) attributable to stockholders or Former Parent as determined in accordance with U.S.

Adjusted EBITDA should not be considered as an alternative to net income (loss) attributable to stockholders as determined in accordance with U.S.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The following tables set forth certain information for each reportable segment:

For the Three Months Ended September 30, 2023

Three Months Ended September 30, 2023

For the Three Months Ended March 31, 2024

Three Months Ended March 31, 2024

Ports and Terminals

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Equity in (losses) earnings of unconsolidated entities — — — ( 7,037 ) ( 4,874 ) 9 ( 11,902 )

(Loss) gain on sale of assets, net ( 264 ) 1 — — — — ( 263 )

Loss on extinguishment of debt ( 937 ) — — — — ( 1,083 ) ( 2,020 )

Loss on sale of assets, net ( 13 ) — — — — — ( 13 )

Interest expense ( 69 ) ( 9,297 ) ( 146 ) — — ( 18,081 ) ( 27,593 )

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Net income (loss) attributable to non-controlling interests in consolidated subsidiaries 61 ( 10,465 ) ( 286 ) — — — ( 10,690 )

Dividends and accretion on redeemable preferred stock — — — — — 15,984 15,984

Dividends and accretion of redeemable preferred stock — — — — — 16,975 16,975

Net income (loss) attributable to stockholders $ 14,436 $ ( 11,120 ) $ ( 4,260 ) $ ( 5,427 ) $ ( 4,214 ) $ ( 45,997 ) $ ( 56,582 )

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The following table sets forth a reconciliation of Adjusted EBITDA to net loss attributable to stockholders:

Three Months Ended September 30, 2023

Three Months Ended March 31, 2024

Ports and Terminals

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Equity in losses of unconsolidated entities ( 11,902 )

Interest costs on pension and OPEB liabilities ( 480 )

Dividends and accretion on redeemable preferred stock ( 15,984 )

Interest and other costs on pension and OPEB liabilities ( 600 )

Dividends and accretion of redeemable preferred stock ( 16,975 )

Pro-rata share of Adjusted EBITDA from unconsolidated entities ( 6,257 )

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FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

For the Nine Months Ended September 30, 2023

Nine Months Ended September 30, 2023

Ports and Terminals

For the Three Months Ended March 31, 2023

Three Months Ended March 31, 2023

Port and Terminals

Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total

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Equity in earnings (losses) of unconsolidated entities — — — 7,761 ( 3,416 ) 21 4,366

(Loss) gain on sale of assets, net ( 473 ) 733 — — — — 260

Loss on extinguishment of debt ( 937 ) — — — — ( 1,083 ) ( 2,020 )

Loss on sale of assets, net ( 124 ) — — — — — ( 124 )

Interest expense ( 955 ) ( 7,884 ) ( 588 ) ( 2 ) — ( 13,821 ) ( 23,250 )

5 unchanged sentences

Net income (loss) attributable to non-controlling interests in consolidated subsidiaries 18 ( 9,185 ) ( 498 ) — ( 228 ) ( 9,893 )

Dividends and accretion on redeemable preferred stock — — — — — 45,811 45,811

Dividends and accretion of redeemable preferred stock — — — — — 14,570 14,570

Net income (loss) attributable to stockholders $ 8,098 $ ( 9,162 ) $ ( 8,831 ) $ 8,542 $ ( 2,811 ) $ ( 36,425 ) $ ( 40,589 )

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The following table sets forth a reconciliation of Adjusted EBITDA to net loss attributable to stockholders:

Nine Months Ended September 30, 2023

Ports and Terminals

Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total

Adjusted EBITDA $ 54,889 $ 21,363 $ ( 7,456 ) $ 29,687 $ ( 4,163 ) $ ( 20,092 ) $ 74,228

Non-controlling share of Adjusted EBITDA 15,577

Equity in losses of unconsolidated entities ( 7,173 )

Interest costs on pension and OPEB liabilities ( 1,440 )

Dividends and accretion on redeemable preferred stock ( 45,811 )

Pro-rata share of Adjusted EBITDA from unconsolidated entities ( 20,630 )

Interest expense ( 73,431 )

Depreciation and amortization expense ( 60,577 )

Incentive allocations —

Asset impairment charges ( 743 )

Changes in fair value of non-hedge derivative instruments ( 1,125 )

Losses on the modification or extinguishment of debt and capital lease obligations ( 2,020 )

Acquisition and transaction expenses ( 1,554 )

Equity-based compensation expense ( 5,814 )

Provision for income taxes ( 2,560 )

Other non-recurring items ( 2,470 )

Net loss attributable to stockholders $ ( 135,543 )

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

For the Three Months Ended September 30, 2022

Three Months Ended September 30, 2022

Port and Terminals

Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total

Total revenues $ 39,186 $ 17,177 $ 1,879 $ — $ — $ 20,317 $ 78,559

Operating expenses 22,003 14,194 4,266 298 — 20,173 60,934

General and administrative — — — — — 3,208 3,208

Acquisition and transaction expenses 224 — — 358 — 2,172 2,754

Management fees and incentive allocation to affiliate — — — — — 2,659 2,659

Depreciation and amortization 5,337 9,748 2,310 — — 741 18,136

Total expenses 27,564 23,942 6,576 656 — 28,953 87,691

Other (expense) income

Equity in (losses) earnings of unconsolidated entities — — — ( 9,222 ) ( 2,891 ) 33 ( 12,080 )

Loss on sale of assets, net ( 134 ) — — — — — ( 134 )

Interest expense ( 64 ) ( 5,983 ) ( 432 ) — — ( 12,682 ) ( 19,161 )

Other (expense) income ( 311 ) ( 1,401 ) — ( 25 ) 473 132 ( 1,132 )

Total other expense ( 509 ) ( 7,384 ) ( 432 ) ( 9,247 ) ( 2,418 ) ( 12,517 ) ( 32,507 )

Income (loss) before income taxes 11,113 ( 14,149 ) ( 5,129 ) ( 9,903 ) ( 2,418 ) ( 21,153 ) ( 41,639 )

(Benefit from) provision for income taxes ( 942 ) 2,114 — — ( 61 ) 444 1,555

Net income (loss) 12,055 ( 16,263 ) ( 5,129 ) ( 9,903 ) ( 2,357 ) ( 21,597 ) ( 43,194 )

Net income (loss) attributable to non-controlling interests in consolidated subsidiaries 6 ( 8,002 ) ( 212 ) — — ( 173 ) ( 8,381 )

Dividends and accretion on redeemable preferred stock — — — — 9,263 9,263

Net income (loss) attributable to stockholders and Former Parent $ 12,049 $ ( 8,261 ) $ ( 4,917 ) $ ( 9,903 ) $ ( 2,357 ) $ ( 30,687 ) $ ( 44,076 )

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The following table sets forth a reconciliation of Adjusted EBITDA to net loss attributable to stockholders and Former Parent:

Three Months Ended September 30, 2022

Port and Terminals

Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total

Adjusted EBITDA $ 18,419 $ 6,023 $ ( 2,471 ) $ 11,253 $ ( 1,340 ) $ ( 5,780 ) $ 26,104

Non-controlling share of Adjusted EBITDA 4,502

Equity in losses of unconsolidated entities ( 12,080 )

Interest costs on pension and OPEB liabilities ( 896 )

Dividends and accretion on redeemable preferred stock ( 9,263 )

Pro-rata share of Adjusted EBITDA from unconsolidated entities ( 9,770 )

Interest expense ( 19,161 )

Depreciation and amortization expense ( 18,136 )

Incentive allocations —

Asset impairment charges —

Changes in fair value of non-hedge derivative instruments 310

Losses on the modification or extinguishment of debt and capital lease obligations —

Acquisition and transaction expenses ( 2,754 )

Equity-based compensation expense ( 1,377 )

Provision for income taxes ( 1,555 )

Other non-recurring items —

Net loss attributable to stockholders and Former Parent $ ( 44,076 )

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

For the Nine Months Ended September 30, 2022

Nine Months Ended September 30, 2022

Port and Terminals

Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total

Total revenues $ 113,887 $ 44,751 $ 1,533 $ — $ — $ 30,404 $ 190,575

Operating expenses 63,933 41,578 12,264 466 10 29,980 148,231

General and administrative — — — — — 8,136 8,136

Acquisition and transaction expenses 579 — — 358 29 14,896 15,862

Management fees and incentive allocation to affiliate — — — — — 9,885 9,885

Depreciation and amortization 15,128 29,187 7,055 — — 1,081 52,451

Total expenses 79,640 70,765 19,319 824 39 63,978 234,565

Other (expense) income

Equity in losses (earnings) of unconsolidated entities — — — ( 43,574 ) ( 4,529 ) 121 ( 47,982 )

Loss on sale of assets, net ( 134 ) — — — — — ( 134 )

Interest expense ( 143 ) ( 18,220 ) ( 1,060 ) — — ( 12,683 ) ( 32,106 )

Other (expense) income ( 976 ) ( 2,791 ) — ( 25 ) 1,553 95 ( 2,144 )

Total other expense ( 1,253 ) ( 21,011 ) ( 1,060 ) ( 43,599 ) ( 2,976 ) ( 12,467 ) ( 82,366 )

Income (loss) before income taxes 32,994 ( 47,025 ) ( 18,846 ) ( 44,423 ) ( 3,015 ) ( 46,041 ) ( 126,356 )

Provision for income taxes 2,391 2,251 — — — 444 5,086

Net income (loss) 30,603 ( 49,276 ) ( 18,846 ) ( 44,423 ) ( 3,015 ) ( 46,485 ) ( 131,442 )

Net income (loss) attributable to non-controlling interests in consolidated subsidiaries 6 ( 23,273 ) ( 862 ) — — ( 198 ) ( 24,327 )

Dividends and accretion on redeemable preferred stock — — — — — 9,263 9,263

Net income (loss) attributable to stockholders and Former Parent $ 30,597 $ ( 26,003 ) $ ( 17,984 ) $ ( 44,423 ) $ ( 3,015 ) $ ( 55,550 ) $ ( 116,378 )

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

The following table sets forth a reconciliation of Adjusted EBITDA to net loss attributable to stockholders and Former Parent:

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

Port and Terminals

2 unchanged sentences

Non-controlling share of Adjusted EBITDA 5,221

Equity in losses of unconsolidated entities ( 47,982 )

Interest costs on pension and OPEB liabilities ( 896 )

Dividends and accretion on redeemable preferred stock ( 9,263 )

Equity in earnings of unconsolidated entities 4,366

Interest and other costs on pension and OPEB liabilities ( 480 )

Dividends and accretion of redeemable preferred stock ( 14,570 )

Pro-rata share of Adjusted EBITDA from unconsolidated entities ( 8,190 )

9 unchanged sentences

Other non-recurring items ( 1,288 )

Net loss attributable to stockholders and Former Parent $ ( 116,378 )

Net loss attributable to stockholders $ ( 40,589 )

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

2 unchanged sentences

All property, plant and equipment and leasing equipment are located in North America.

September 30, 2023

March 31, 2024

Ports and Terminals

3 unchanged sentences

Total assets 719,432 1,199,569 303,284 6,713 96,101 19,582 2,344,681

Debt, net — 736,417 25,000 — — 557,064 1,318,481

Total debt, net — 738,283 44,250 — — 561,656 1,344,189

Current liabilities 49,639 141,146 7,694 1,518 — 39,770 239,767

11 unchanged sentences

Total assets 725,615 1,226,052 304,952 6,827 99,945 16,218 2,379,609

Debt, net 10,000 732,145 25,000 — — 463,012 1,230,157

Total debt, net — 737,335 44,250 — — 559,325 1,340,910

Current liabilities 54,150 65,052 4,912 828 — 25,695 150,637

6 unchanged sentences

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

17 unchanged sentences

Failure to pay such dividends will result in a dividend rate equal to 18.0 % per annum, and a failure to pay cash dividends for 12 monthly dividend periods (whether or not consecutive) following the second anniversary of the issuance date will constitute an event of noncompliance.

The dividend rate on the Preferred Stock will increase by 1.0 % per annum beginning on the fifth anniversary of the issuance date of the Redeemable Preferred Stock.

As of September 30, 2023, the Company has $ 60.1 million of dividends PIK increasing our Redeemable Preferred Stock balance.

Dividends recorded in Dividends and accretion on redeemable preferred stock on the Consolidated and Combined Consolidated Statement of Operations totaled $ 14.3 million and $ 40.9 million for the three and nine months ended September 30, 2023, respectively, and $ 8.2 million for both the three and nine months ended September 30, 2022.

The dividend rate on the Redeemable Preferred Stock will increase by 1.0 % per annum beginning on the fifth anniversary of the issuance date of the Redeemable Preferred Stock.

As of March 31, 2024, the Company has $ 88.6 million of PIK dividends increasing our Redeemable Preferred Stock balance.

Dividends recorded in Dividends and accretion of redeemable preferred stock on the Consolidated Statements of Operations totaled $ 15.3 million and $ 12.9 million for the three months ended March 31, 2024 and 2023, respectively.

The Company has presented the Redeemable Preferred Stock in temporary equity and is accreting the discount and debt issuance costs using the interest method to the earliest redemption date of August 1, 2030.

Such accretion, recorded in Dividends and accretion on redeemable preferred stock on the Consolidated and Combined Consolidated Statement of Operations, totaled $ 1.7 million and $ 4.9 million for the three and nine months ended September 30, 2023, respectively, and $ 1.1 million for both the three and nine months ended September 30, 2022.

Such accretion, recorded in Dividends and accretion of redeemable preferred stock on the Consolidated Statements of Operations, totaled $ 1.7 million and $ 1.6 million for the three months ended March 31, 2024 and 2023, respectively.

Mandatory Redemption :

4 unchanged sentences

Upon certain contingent events or events of noncompliance, the preferred stockholders have the right to a majority of the board seats of the Company.

If the Redeemable Preferred Stock were redeemed as of September 30, 2023, it would be redeemable for $ 448.2 million.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

If the Redeemable Preferred Stock were redeemed as of March 31, 2024, it would be redeemable for $ 446.5 million.

Amendment to Certificate of Designations of Our Series A Preferred Stock

1 unchanged sentence

The holders of our Series A Preferred Stock received a customary fee for their consent and purchased $ 33.4 million aggregate principal amount of the Additional Notes.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

EARNINGS PER SHARE AND EQUITY

Basic loss per share of common stock (“LPS”) is calculated by dividing net loss attributable to stockholders and Former Parent by the weighted average number of common stock outstanding, plus any participating securities.

Diluted LPS is calculated by dividing net loss attributable to stockholders or Former Parent by the weighted average number of common stock outstanding, plus any participating securities and potentially dilutive securities.

Basic loss per share of common stock (“LPS”) is calculated by dividing net loss attributable to stockholders by the weighted average number of common stock outstanding, plus any participating securities.

Diluted LPS is calculated by dividing net loss attributable to stockholders by the weighted average number of common stock outstanding, plus any participating securities and potentially dilutive securities.

Potentially dilutive securities are calculated using the treasury stock method.

The calculation of basic and diluted LPS is presented below:

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands, except per share data) 2024 2023

1 unchanged sentence

Net loss attributable to non-controlling interests in consolidated subsidiaries ( 10,690 ) ( 9,893 )

Dividends and accretion on redeemable preferred stock 15,984 9,263 45,811 9,263

Net loss attributable to stockholders/Former Parent $ ( 56,101 ) $ ( 44,076 ) $ ( 135,543 ) $ ( 116,378 )

Dividends and accretion of redeemable preferred stock

16,975 14,570

Net loss attributable to stockholders

$ ( 56,582 ) $ ( 40,589 )

Weighted Average Common Stock Outstanding - Basic (1)

6 unchanged sentences

________________________________________________________

(1) Three and nine months ended September 30, 2023 includes penny warrants which can be converted into a fixed amount of our stock.

(2) Diluted LPS for the three and nine months ended September 30, 2023 includes the dilutive effect of subsidiary earnings per share.

For the three and nine months ended September 30, 2023, 3,023,965 and 2,343,212 sha res, respectively, have been excluded from the calculation of Diluted LPS because the impact would be anti-dilutive.

On the Spin-off Date, FTAI distributed one share of FTAI Infrastructure, Inc.

common stock for each FTAI common share held by FTAI’s shareholders of record as of the record date.

As of that date, 99,387,467 shares were distributed.

This number of shares is utilized for the calculation of basic and diluted loss per share for all periods presented prior to the spin-off.

For the three and nine months ended September 30, 2022, these shares are treated as issued and outstanding for purposes of calculating historical earnings per share.

For periods prior to the spin-off, it is assumed that there are no dilutive equity instruments as there were no equity awards of FTAI Infrastructure, Inc.

outstanding prior to the spin-off.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

(1) Three months ended March 31, 2024 includes penny warrants which can be converted into a fixed amount of our stock.

(2) Diluted LPS for the three months ended March 31, 2024 includes the dilutive effect of subsidiary earnings per share.

For the three months ended March 31, 2024 and 2023, 7,196,869 and 1,647,839 shares of common stock, respectively, h ave been excluded from the calculation of Diluted LPS because the impact would be anti-dilutive.

Common Stock Warrants

A summary of the status of the Company’s outstanding stock warrants and changes during the nine months ended September 30, 2023 is as follows:

A summary of the status of the Company’s outstanding stock warrants and changes during the three months ended March 31, 2024 is as follows:

Number of Warrants Weighted Average Exercise Price

2 unchanged sentences

Exercised — —

Outstanding as of September 30, 2023 (1)

Outstanding as of March 31, 2024 (1)

6,685,132 $ 4.93

Warrants exercisable as of September 30, 2023 (1)

Warrants exercisable as of March 31, 2024 (1)

6,685,132 $ 4.93

________________________________________________________

(1) Weighted average exercise price as of September 30, 2023 includes adjustments for quarterly dividend payments.

The weighted average remaining contractual term of the outstanding warrants as of September 30, 2023 is 6.8 years.

The aggregate intrinsic value of the warrants as of September 30, 2023 is $ 10.7 million.

(1) Weighted average exercise price as of March 31, 2024 includes adjustments for quarterly dividend payments.

The weighted average remaining contractual term of the outstanding warrants as o f March 31, 2024 is 6.3 years.

The aggregate intrinsic value of the warrants as of March 31, 2024 is $ 21.0 million.

COMMITMENTS AND CONTINGENCIES

3 unchanged sentences

The contingency related to $ 5.0 million of the total $ 15.0 million was resolved during the year ended December 31, 2021, and the contingency related to an additional $ 5.0 million of the total $ 15.0 million was resolved during year ended December 31, 2022.

FTAI INFRASTRUCTURE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(Dollars in tables in thousands, unless otherwise noted)

SUBSEQUENT EVENTS

On October 26, 2023, our board of directors declared a cash dividend on our common stock of $ 0.03 per share for the quarter ended September 30, 2023, payable on November 16, 2023 to the holders of record on November 9, 2023.

Jefferson Credit Agreement

On April 2, 2024, our Jefferson Terminal segment entered into a credit agreement, providing for a $ 75.0 million term loan facility, which matures at the earlier of (i) December 13, 2024 or (ii) 30 days prior to the date on which the first cash dividend payment on preferred equity is paid, and bears interest at the Applicable Margin of 4.00 % plus Adjusted Term SOFR.

On May 7, 2024, our board of directors declared a cash dividend on our common stock of $ 0.03 per share for the quarter ended March 31, 2024, payable on May 29, 2024 to the holders of record on May 17, 2024.

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