FTAI Infrastructure Inc. 10-K

Item 8. Financial Statements and Supplementary Data Index to Financial Statements: Consolidated and Combined Consolidated Financial Statements of FTAI Infrastructure Inc.: Report of Independent Registered Public Accounting Firm (PCAOB ID: 42 ) 59 Consolidated Balance Sheets as of December 31, 2024 and 2023 61 Consolidated and Combined Consolidated Statements of Operations for the years ended December 31, 2024, 2023 and 2022 62 Consolidated and Combined Consolidated Statements of Comprehensive (Loss) Income for the years ended December 31, 2024, 2023 and 2022 63 Consolidated and Combined Consolidated Statement of Changes in Equity for the years ended December 31, 2024, 2023 and 2022 64 Consolidated and Combined Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023 and 2022 65 Notes to Consolidated and Combined Consolidated Financial Statements 67 58 Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of FTAI Infrastructure Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of FTAI Infrastructure Inc. (the Company) as of December 31, 2024 and 2023, the related consolidated and combined consolidated statements of operations, comprehensive (loss) income, changes in equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated and combined consolidated financial statements”). In our opinion, the consolidated and combined consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 13, 2025 expressed an unqualified opinion thereon. Company’s disclosure of an additional measure of segment profit or loss In Note 15 to the consolidated and combined consolidated financial statements, the Company has elected to disclose Adjusted EBITDA (Adjusted EBITDA is defined as net income (loss) attributable to stockholders and 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 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) as a segment profit or loss measure as permitted pursuant to ASC 280 and that the U.S. Securities and Exchange Commission (SEC) defines as a non-GAAP measure. Accordingly, we express no opinion on whether the segment profit or loss measure complies with SEC Regulation S-K, Item 10(e) and Regulation G, Item 101. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated and combined consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates. 59 Valuation of Goodwill - Jefferson Terminal Reporting Unit Description of the Matter At December 31, 2024, the Company’s goodwill was $275.4 million for the Jefferson Terminal reporting unit. As discussed in Note 2 of the consolidated and combined consolidated financial statements, goodwill is tested for impairment at least annually at the reporting unit level. Auditing the fair value estimate of the Jefferson Terminal reporting unit used in the annual goodwill impairment test was complex and highly judgmental due to the significant estimation required in determining the fair value of the Jefferson Terminal reporting unit. In particular, the fair value estimate was sensitive to significant assumptions such as the forecasted revenue growth rates, capital expenditures and discount rate, which are affected by expectations about the Company’s ability to secure new contracts and increase volumes from existing contracts as well as expectations about the overall industry, market and economic conditions. How We Addressed the Matter in Our Audit To test the estimated fair value of the Company’s Jefferson Terminal reporting unit for use in the goodwill impairment assessment, we performed audit procedures that included, among others, assessing the valuation methodology used and testing the significant assumptions, described above, and the completeness and accuracy of the underlying data used by the Company in its impairment test. For example, we compared significant assumptions used by management to current industry, market and economic trends and to the historical results of the reporting unit and other guideline companies within the same industry. We also assessed the historical accuracy of management’s estimates and performed sensitivity analyses to evaluate the changes in the fair value of the Jefferson Terminal reporting unit that would result from changes in the significant assumptions. We also involved our internal valuation specialists to assist in our evaluation of the Company's valuation methodology and certain significant assumptions. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2021. New York, New York March 13, 2025 60 FTAI INFRASTRUCTURE INC. CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except share and per share data) Notes December 31, 2024 2023 Assets Current assets: Cash and cash equivalents 2 $ 27,785 $ 29,367 Restricted cash and cash equivalents 2 119,511 58,112 Accounts receivable, net 2 52,994 55,990 Other current assets 2 19,561 42,034 Total current assets 219,851 185,503 Leasing equipment, net 3 37,453 35,587 Operating lease right-of-use assets, net 10 67,937 69,748 Property, plant, and equipment, net 4 1,653,468 1,630,829 Investments 5 12,529 72,701 Intangible assets, net 6 46,229 52,621 Goodwill 2 275,367 275,367 Other assets 2 61,554 57,253 Total assets $ 2,374,388 $ 2,379,609 Liabilities Current liabilities: Accounts payable and accrued liabilities 2 $ 176,425 $ 130,796 Debt, net 48,594 — Operating lease liabilities 10 7,172 7,218 Other current liabilities 2 18,603 12,623 Total current liabilities 250,794 150,637 Debt, net 7 1,539,241 1,340,910 Operating lease liabilities 10 60,893 62,441 Other liabilities 67,104 87,530 Total liabilities 1,918,032 1,641,518 Commitments and contingencies 18 — — Redeemable preferred stock ($ 0.01 par value per share; 200,000,000 shares authorized; 300,000 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively; redemption amount of $ 431.8 million and $ 446.5 million as of December 31, 2024 and December 31, 2023, respectively) 16 381,218 325,232 Equity Common stock ($ 0.01 par value per share; 2,000,000,000 shares authorized; 113,934,860 and 100,589,572 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively) 1,139 1,006 Additional paid in capital 764,381 843,971 Accumulated deficit ( 405,818 ) ( 182,173 ) Accumulated other comprehensive loss ( 157,051 ) ( 178,515 ) Stockholders' equity 202,651 484,289 Non-controlling interests in equity of consolidated subsidiaries ( 127,513 ) ( 71,430 ) Total equity 75,138 412,859 Total liabilities, redeemable preferred stock and equity $ 2,374,388 $ 2,379,609 See accompanying notes to the consolidated and combined consolidated financial statements. 61 FTAI INFRASTRUCTURE INC. CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except share and per share data) Year Ended December 31, Notes 2024 2023 2022 Revenues Total revenues 9 $ 331,497 $ 320,472 $ 261,966 Expenses Operating expenses 2 247,674 253,672 208,157 General and administrative 14,798 12,833 10,891 Acquisition and transaction expenses 5,457 4,140 16,844 Management fees and incentive allocation to affiliate 14 11,318 12,467 12,964 Depreciation and amortization 3, 4, 6 79,410 80,992 70,749 Asset impairment 72,336 743 — Total expenses 430,993 364,847 319,605 Other (expense) income Equity in losses of unconsolidated entities 5 ( 55,496 ) ( 24,707 ) ( 67,399 ) Gain (loss) on sale of assets, net 2,370 6,855 ( 1,603 ) Loss on modification or extinguishment of debt ( 8,925 ) ( 2,036 ) — Interest expense ( 122,108 ) ( 99,603 ) ( 53,239 ) Other income (expense) 20,904 6,586 ( 3,169 ) Total other expense ( 163,255 ) ( 112,905 ) ( 125,410 ) Loss before income taxes ( 262,751 ) ( 157,280 ) ( 183,049 ) Provision for income taxes 13 3,313 2,470 4,468 Net loss ( 266,064 ) ( 159,750 ) ( 187,517 ) Less: Net loss attributable to non-controlling interests in consolidated subsidiaries ( 42,419 ) ( 38,414 ) ( 33,933 ) Less: Dividends and accretion of redeemable preferred stock 70,814 62,400 23,657 Net loss attributable to stockholders/Former Parent $ ( 294,459 ) $ ( 183,736 ) $ ( 177,241 ) Loss per share: 17 Basic $ ( 2.72 ) $ ( 1.78 ) $ ( 1.73 ) Diluted $ ( 2.72 ) $ ( 1.79 ) $ ( 1.73 ) Weighted average shares outstanding: Basic 108,217,871 102,960,812 102,747,121 Diluted 108,217,871 102,960,812 102,747,121 See accompanying notes to the consolidated and combined consolidated financial statements. 62 FTAI INFRASTRUCTURE INC. CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (Dollars in thousands) Year Ended December 31, 2024 2023 2022 Net loss $ ( 266,064 ) $ ( 159,750 ) $ ( 187,517 ) Other comprehensive (loss) income: Other comprehensive (loss) income related to equity method investees ( 2,523 ) 123,845 ( 149,078 ) Changes in pension and other postretirement benefit accounts (1) 23,987 ( 2,227 ) 4,409 Total other comprehensive income (loss) 21,464 121,618 ( 144,669 ) Comprehensive loss ( 244,600 ) ( 38,132 ) ( 332,186 ) Comprehensive loss attributable to non-controlling interests ( 42,419 ) ( 38,414 ) ( 33,933 ) Comprehensive (loss) income attributable to stockholders/Former Parent $ ( 202,181 ) $ 282 $ ( 298,253 ) ______________________________________________________________________________________ (1) Net of deferred tax expense of $ 1.9 million, $ — and $ — for the years ended December 31, 2024, 2023 and 2022, respectively. See accompanying notes to the consolidated and combined consolidated financial statements. 63 FTAI INFRASTRUCTURE INC. CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Dollars in thousands) Common Stock Net Former Parent Investment Additional Paid in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Non-Controlling Interests in Equity of Consolidated Subsidiaries Total Equity Equity - December 31, 2021 $ — $ 1,617,601 $ — $ — $ ( 155,464 ) $ ( 91 ) $ 1,462,046 Net loss ( 92,747 ) ( 60,837 ) ( 33,933 ) ( 187,517 ) Other comprehensive loss ( 144,669 ) ( 144,669 ) Total comprehensive loss — ( 92,747 ) — ( 60,837 ) ( 144,669 ) ( 33,933 ) ( 332,186 ) Net transfers from Former Parent ( 617,321 ) ( 617,321 ) Distribution by Former Parent 994 ( 907,533 ) 906,539 — Acquisition of subsidiary 3,054 3,054 Contributions from non-controlling interests 731 731 Distributions to non-controlling interests ( 143 ) ( 143 ) Issuance of warrants 13,750 13,750 Issuance of Manager options 18,127 18,127 Dividends and accretion of redeemable preferred stock ( 23,657 ) ( 23,657 ) Dividends declared on common stock ( 3,082 ) ( 3,082 ) Distributions to Manager ( 78 ) ( 78 ) Settlement of equity-based compensation ( 593 ) ( 593 ) Equity-based compensation 4,146 4,146 Equity - December 31, 2022 $ 994 $ — $ 911,599 $ ( 60,837 ) $ ( 300,133 ) $ ( 26,829 ) $ 524,794 Net loss ( 121,336 ) ( 38,414 ) ( 159,750 ) Other comprehensive income 121,618 121,618 Total comprehensive (loss) income — — — ( 121,336 ) 121,618 ( 38,414 ) ( 38,132 ) Acquisition of consolidated subsidiary ( 953 ) ( 3,495 ) ( 4,448 ) Distributions to non-controlling interests ( 1,647 ) ( 1,647 ) Issuance of common shares 12 16 28 Dividends and accretion of redeemable preferred stock ( 62,400 ) ( 62,400 ) Dividends declared on common stock ( 12,372 ) ( 12,372 ) Settlement of equity-based compensation ( 1,629 ) ( 534 ) ( 2,163 ) Equity-based compensation 9,710 ( 511 ) 9,199 Equity - December 31, 2023 $ 1,006 $ — $ 843,971 $ ( 182,173 ) $ ( 178,515 ) $ ( 71,430 ) $ 412,859 Net loss ( 223,645 ) ( 42,419 ) ( 266,064 ) Other comprehensive income 21,464 21,464 Total comprehensive (loss) income — — — ( 223,645 ) 21,464 ( 42,419 ) ( 244,600 ) Distributions to non-controlling interests ( 15,039 ) ( 15,039 ) Issuance of common shares 133 419 552 Dividends and accretion of redeemable preferred stock ( 70,814 ) ( 70,814 ) Dividends declared on common stock ( 13,124 ) ( 13,124 ) Settlement of equity-based compensation ( 2,906 ) ( 426 ) ( 3,332 ) Equity-based compensation 6,835 1,801 8,636 Equity - December 31, 2024 $ 1,139 $ — $ 764,381 $ ( 405,818 ) $ ( 157,051 ) $ ( 127,513 ) $ 75,138 See accompanying notes to the consolidated and combined consolidated financial statements. 64 FTAI INFRASTRUCTURE INC. CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) Year Ended December 31, 2024 2023 2022 Cash flows from operating activities: Net loss $ ( 266,064 ) $ ( 159,750 ) $ ( 187,517 ) Adjustments to reconcile net loss to cash provided by (used in) operating activities: Equity in losses of unconsolidated entities 55,496 24,707 67,399 (Gain) loss on sale of assets, net ( 2,370 ) ( 6,855 ) 1,603 Loss on modification or extinguishment of debt 8,925 2,036 — Gain on sale of easement ( 3,486 ) — — Equity-based compensation 8,636 9,199 4,146 Depreciation and amortization 79,410 80,992 70,749 Asset impairment 72,336 743 — Change in deferred income taxes 1,920 2,016 3,982 Change in fair value of non-hedge derivatives — 1,125 ( 1,125 ) Amortization of financing costs 6,248 6,769 4,393 Bad debt expense 863 1,977 575 Amortization of bond discount 8,682 4,853 1,903 Change in: Accounts receivable 2,133 2,840 ( 3,303 ) Other assets ( 1,976 ) 25,183 ( 7,799 ) Accounts payable and accrued liabilities 20,970 8,553 7,013 Other liabilities ( 7,001 ) 1,125 ( 4,709 ) Net cash (used in) provided by operating activities ( 15,278 ) 5,513 ( 42,690 ) Cash flows from investing activities: Investment in unconsolidated entities ( 3,826 ) ( 7,077 ) ( 5,996 ) Acquisition of business, net of cash acquired — ( 4,448 ) ( 3,819 ) Acquisition of leasing equipment ( 3,288 ) ( 1,724 ) — Acquisition of property, plant and equipment ( 79,536 ) ( 99,022 ) ( 217,141 ) Investment in promissory notes ( 31,438 ) ( 36,044 ) ( 47,454 ) Investment in equity instruments ( 5,000 ) — — Proceeds from sale of leasing equipment — 105 — Proceeds from insurance recoveries 267 — — Proceeds from sale of property, plant and equipment 1,198 1,087 7,144 Proceeds from sale of easement 3,486 — — Net cash used in investing activities $ ( 118,137 ) $ ( 147,123 ) $ ( 267,266 ) 65 FTAI INFRASTRUCTURE INC. CONSOLIDATED AND COMBINED CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) Year Ended December 31, 2024 2023 2022 Cash flows from financing activities: Proceeds from debt, net $ 498,426 $ 181,350 $ 519,025 Repayment of debt ( 247,594 ) ( 75,131 ) — Payment of financing costs ( 11,438 ) ( 8,834 ) ( 13,605 ) Proceeds from issuance of redeemable preferred stock — — 291,000 Redeemable preferred stock issuance costs — — ( 16,433 ) Distributions to Manager — — ( 78 ) Capital contributions from non-controlling interests — — 731 Distributions to non-controlling interests ( 15,039 ) ( 1,647 ) ( 143 ) Settlement of equity-based compensation ( 3,335 ) ( 2,161 ) ( 593 ) Net transfers to (from) Former Parent — — ( 617,321 ) Cash dividends - common stock ( 13,124 ) ( 12,372 ) ( 3,082 ) Cash dividends - redeemable preferred stock ( 14,664 ) ( 1,758 ) ( 1,758 ) Net cash provided by financing activities 193,232 79,447 157,743 Net increase (decrease) in cash and cash equivalents and restricted cash and cash equivalents 59,817 ( 62,163 ) ( 152,213 ) Cash and cash equivalents and restricted cash and cash equivalents, beginning of period 87,479 149,642 301,855 Cash and cash equivalents and restricted cash and cash equivalents, end of period $ 147,296 $ 87,479 $ 149,642 Supplemental disclosure of cash flow information: Cash paid for interest, net of capitalized interest $ 94,396 $ 88,411 $ 38,083 Cash paid for taxes 457 459 379 Supplemental disclosure of non-cash investing and financing activities: Acquisition of property, plant and equipment $ ( 48,607 ) $ ( 1,670 ) $ ( 5,662 ) Dividends and accretion of redeemable preferred stock ( 56,150 ) ( 60,642 ) ( 21,898 ) Conversion of interests in unconsolidated subsidiaries — — ( 21,302 ) Non-cash change in equity method investment ( 2,523 ) 123,845 ( 149,078 ) Financing fees ( 16,158 ) — — See accompanying notes to the consolidated and combined consolidated financial statements. 66 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 1. ORGANIZATION FTAI Infrastructure Inc. (“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) 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”). We have five reportable segments: (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 15). 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. 2. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation: 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 periods after the Spin-off Date through December 31, 2024 are consolidated financial statements based on the reported results of FTAI Infrastructure Inc. as a standalone company. The historical results of operations 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 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 prior to the Spin-off date. Principles of Combination —FTAI Infrastructure had 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. 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 FIG LLC (the “Manager”), an affiliate of Fortress Investment Group LLC (“Fortress”), 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 67 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 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 from Former Parent”. Refer to Note 14 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. 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. All significant intercompany transactions and balances have been eliminated. All adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The ownership interest of other investors in consolidated subsidiaries is recorded as non-controlling interest. We use the equity method of accounting for investments in entities in which we exercise significant influence but which do not meet the requirements for consolidation. Under the equity method, we record our proportionate share of the underlying net income (loss) of these entities as well as the proportionate interest in adjustments to other comprehensive income (loss). 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. Actual results could differ from those estimates. Risks and Uncertainties —In the normal course of business, we encounter several significant types of economic risk including credit, market, and capital market risks. Credit risk is the risk of the inability or unwillingness of a lessee, customer, or derivative counterparty to make contractually required payments or to fulfill its other contractual obligations. Market risk reflects the risk of a downturn or volatility in the underlying industry segments in which we operate, which could adversely impact the pricing of the services offered by us or a lessee’s or customer’s ability to make payments. Capital market risk is the risk that we are unable to obtain capital at reasonable rates to fund the growth of our business or to refinance existing debt facilities. We do not have significant exposure to foreign currency risk as all of our leasing and revenue arrangements are denominated in U.S. dollars. Liquidity —As disclosed in Note 19, subsequent to December 31, 2024, the Company has (i) extended the maturity dates of its EB-5 and EB-5.2 Loan Agreements to January 25, 2027 and March 10, 2027, respectively, (ii) amended its October 2024 Jefferson Credit Agreement to include the option to extend its maturity date to April 1, 2026 and (iii) executed an additional loan agreement for $30.0 million at its Repauno segment that will be due July 18, 2025 and includes the option to extend its maturity date to April 1, 2026. Notwithstanding these actions, Management concluded that the Company’s current liquidity and forecasted cash flows from operations are not sufficient to meet its obligations as they become due, when including cash dividend payments on its Series A Preferred Stock. However, Management has approved a plan to accrue paid-in-kind dividends on the Series A Preferred Stock which would preclude the payment of future dividends on common stock, excluding the common dividend that our board of directors declared on February 27, 2025 that will be paid on March 26, 2025 (see Note 19). In addition, Management will exercise the options to extend the maturity dates of the debt instruments noted above, as needed. Management concluded that such plans are probable of being implemented and 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. Delaware River Partners LLC During 2016, through Delaware River Partners LLC (“DRP”), a consolidated subsidiary, we purchased the assets of Repauno, which consisted primarily of land, a storage cavern, and riparian rights for the acquired land, site improvements and rights. Upon acquisition there were no operational processes that could be applied to these assets that would result in outputs without significant green field development. We currently hold an approximately 98 % economic interest, and a 100 % voting interest in 68 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) DRP. DRP is solely reliant on us to finance its activities and therefore is a VIE. 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 $ 341.6 million and $ 305.0 million, and total VIE liabilities of DRP were $ 88.5 million and $ 52.7 million as of December 31, 2024 and 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. Restricted Cash and Cash Equivalents —Restricted cash and cash equivalents consists of cash in money market funds and other permitted highly liquid short term investments that can be used for principal, interest and project funding pursuant to the requirements of certain of our debt agreements (see Note 7) and other qualifying construction projects at Jefferson Terminal. Property, Plant and Equipment, Leasing Equipment and Depreciation —Property, plant and equipment and leasing equipment are stated at cost (inclusive of capitalized acquisition costs, where applicable) and depreciated using the straight-line method, over their estimated useful lives, to estimated residual values which are summarized as follows: Asset Range of Estimated Useful Lives Residual Value Estimates Railcars and locomotives 40 - 50 years from date of manufacture Scrap value at end of useful life Track and track related assets 15 - 50 years from date of manufacture Scrap value at end of useful life Land, site improvements and rights N/A N/A Bridges and tunnels 15 - 55 years Scrap value at end of useful life Buildings and site improvements 20 - 30 years Scrap value at end of useful life Railroad equipment 3 - 15 years from date of manufacture Scrap value at end of useful life Terminal machinery and equipment 15 - 25 years from date of manufacture Scrap value at end of useful life Furniture and fixtures 3 - 6 years from date of purchase None Computer hardware and software 3 - 5 years from date of purchase None Construction in progress N/A N/A Major improvements and modifications incurred in connection with the acquisition of property, plant and equipment and leasing equipment that are required to get the asset ready for initial service are capitalized and depreciated over the remaining life of the asset. Project costs of major additions and betterments, including capitalizable engineering costs and other costs directly related to the development or construction of project, are capitalized and depreciation commences once it is placed into service. Interest costs directly related to and incurred during the construction period of property, plant and equipment are capitalized. Spare parts are depreciated in conjunction with the underlying property, plant and equipment asset when placed in service. We review our depreciation policies on a regular basis to determine whether changes have taken place that would suggest that a change in our depreciation policies, useful lives of our equipment or the assigned residual values is warranted. Capitalized Interest —The interest cost associated with major development and construction projects is capitalized and included in the cost of the project. 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 $ 6.6 million, $ 5.0 million and $ 9.2 million during the years ended December 31, 2024, 2023 and 2022, 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 $ 20.1 million, $ 19.2 million and $ 13.4 million during the years ended December 31, 2024, 2023 and 2022, respectively, and are included in Operating expenses in the Consolidated and Combined Consolidated Statements of Operations. Impairment of Long-Lived Assets —We perform a recoverability assessment of each of our long-lived assets whenever events or changes in circumstances, or indicators, indicate that the carrying amount or net book value of an asset may not be recoverable. Indicators may include, but are not limited to, a significant change in market conditions; or the introduction of newer technology. When performing a recoverability assessment, we measure whether the estimated future undiscounted net cash flows expected to be generated by the asset exceeds its net book value. The undiscounted cash flows consist of cash flows from terminal services contracts and currently contracted leases, future projected leases, terminal service and freight rail rates, transition costs, and estimated residual or scrap values. In the event that an asset does not meet the recoverability test, the carrying value of the asset will be adjusted to fair value resulting in an impairment charge. Management develops the assumptions used in the recoverability analysis based on its knowledge of active contracts, current and future expectations of the demand for a particular asset and historical experience, as well as information received from third party industry sources. 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 comprised of: 69 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) December 31, 2024 December 31, 2023 Commodities inventory $ 311 $ 311 Note receivable — 21,425 Prepaid expenses 9,751 8,930 Other receivables 384 5,716 Other assets 9,115 5,652 Total other current assets $ 19,561 $ 42,034 For the year ended December 31, 2024, the Company determined that its note receivable from an investment included in the Sustainability and Energy Transition segment should be impaired due to the investment continuing to generate operating losses and not achieving expected results. The related impairment charge is recorded in Asset impairment charges in the Consolidated and Combined Consolidated Statements of Operations for the year ended December 31, 2024. Other Assets —Other assets consists of a note receivable of $ 11.9 million and $ 11.7 million as of December 31, 2024 and 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 (expense) in the Consolidated and Combined Consolidated Statements of Operations, on this note receivable using the contractual interest rate. Other assets also consists of capitalized contract costs of $ 18.6 million and $ 17.6 million as of December 31, 2024 and 2023, respectively. 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 the Manager. Other Current Liabilities —Other current liabilities primarily include environmental liabilities of $ 0.5 million and $ 0.5 million, insurance premium liabilities of $ 5.0 million and $ 3.2 million, and deferred revenue of $ 8.3 million and $ 5.8 million as of December 31, 2024 and 2023, respectively. During the year ended December 31, 2024, the Company recognized revenue of $ 1.3 million that was included in the deferred revenue balance at the beginning of the year. 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. As of December 31, 2024, 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 December 31, 2023, 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. We review the carrying values of goodwill at least annually to assess impairment since these assets are not amortized. An annual impairment review is conducted as of October 1st of each year. Additionally, we review the carrying value of goodwill whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The determination of fair value involves significant management judgment. For an annual goodwill impairment assessment, an optional qualitative analysis may be performed. If the option is not elected or if it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then a goodwill impairment test is performed to identify potential goodwill impairment and measure an impairment loss. A goodwill impairment assessment compares the fair value of a respective reporting unit with its carrying amount, including goodwill. The estimate of fair value of the respective reporting unit is based on the best information available as of the date of assessment, which primarily incorporates certain factors including our assumptions about operating results, business plans, income projections, anticipated future cash flows and market data. If the estimated fair value of the reporting unit is less than the carrying amount, a goodwill impairment is recorded to the extent that the carrying value of the reporting unit exceeds the fair value. As of October 1, 2024, we elected to complete a qualitative impairment assessment of the goodwill related to our Transtar and FYX reporting units and concluded that it was more likely than not that the fair value of the Transtar and FYX reporting units exceeded their respective carrying values. Therefore, no quantitative impairment evaluation was completed. As part of our assessment, we considered numerous factors, including: • macroeconomic conditions and their potential impact on reporting unit fair value; • industry and market conditions; • cost factors such as increases in raw materials, labor or other costs; • actual financial performance compared with budget and prior projections; and • events that may change the composition or carrying value of its net assets. For our Jefferson Terminal reporting unit, we completed a quantitative analysis. 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, capital expenditures and discount rates. The estimates 70 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 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. In connection with our impairment analysis, although we believe the estimates of fair value are reasonable, the determination of certain valuation inputs is subject to management's judgment. 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% as of October 1, 2024. 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, expansion of volumes and execution of contracts related to sustainable fuels and movements in future oil spreads. At October 1, 2024, approximately 6.0 million barrels of storage was operational. Our discount rate for our 2024 goodwill impairment analysis was 9.5 % 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 and natural gas production in the U.S. and Canada, are expected to result in increased demand for storage on the U.S. Gulf Coast. Although we do not have significant direct exposure to volatility of crude oil prices, changes in crude oil pricing that affect long term refining planned output could impact Jefferson Terminal operations. We expect the Jefferson Terminal reporting unit to continue to generate positive Adjusted EBITDA in future years. 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 years ended December 31, 2024, 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 138 months and 144 months as of December 31, 2024 and 2023, respectively. Redeemable Preferred Stock —We classify the Series A 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. The carrying value of the Redeemable Preferred Stock is accreted to the redemption value at the earliest redemption date, which has been determined to be August 1, 2030. We use the interest method to accrete to the redemption value. 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 $ 14.8 million and $ 31.3 million as of December 31, 2024 and 2023, respectively, are included in Debt, net in the Consolidated Balance Sheets. Amortization expense was $ 6.2 million, $ 6.8 million and $ 4.4 million for the years ended December 31, 2024, 2023 and 2022, respectively, and is included in Interest expense in the Consolidated and Combined Consolidated Statements of Operations. Terminal Services Revenues —Terminal services are provided to customers for the receipt and redelivery of various commodities. These revenues relate to performance obligations that are recognized over time using the right to invoice practical expedient, i.e., invoiced as the services are rendered and the customer simultaneously receives and consumes the benefit over the contract term. The Company’s performance of service and right to invoice corresponds with the value delivered to our customers. Revenues are typically invoiced and paid on a monthly basis. Rail Revenues —Rail revenues generally consist of the following performance obligations: industrial switching, interline services, demurrage and storage. Switching revenues are derived from the performance of switching services, which involve the movement of cars from one point to another within the limits of an individual plant, industrial area, or a rail yard. Switching revenues are recognized as the services are performed, and the services are generally completed on the same day they are initiated. Interline revenues are derived from transportation services for railcars that originate or terminate at our railroads and involve one or more other carriers. For interline traffic, one railroad typically invoices a customer on behalf of all railroads participating in the route directed by the customer. The invoicing railroad then pays the other railroads its portion of the total amount invoiced on a monthly basis. We record revenue related to interline traffic for transportation service segments provided by carriers along railroads that are not owned or controlled by us on a net basis. Interline revenues are recognized as the transportation movements occur. Our ancillary services revenue primarily relates to demurrage and storage services. Demurrage represents charges assessed by railroads for the detention of cars by shippers or receivers of freight beyond a specified free time and is recognized on a per day 71 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) basis. Storage services revenue is earned for the provision of storage of shippers’ railcars and is generally recognized on a per day, per car basis, as the storage services are provided. Lease Income —Lease income consists of rental income from tenants for storage space. Lease income is recognized on a straight-line basis over the terms of the relevant lease agreement. 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. Revenue is recognized when a performance obligation is satisfied by completing a repair service at a point in time. Revenues are typically invoiced for each repair and generally have 30-day payment terms. Other Revenue —Other revenue primarily consists of revenue related to the handling, storage and sale of raw materials. Revenues for the handling and storage of raw materials relate to performance obligations that are recognized over time using the right to invoice practical expedient, i.e., invoiced as the services are rendered and the customer simultaneously receives and consumes the benefit over the contract term. Our performance of service and right to invoice corresponds with the value delivered to our customers. Revenues for the sale of raw materials relate to contracts that contain performance obligations to deliver the product over the term of the contract. The revenues are recognized when the control of the product is transferred to the customer, based on the volume delivered and the price within the contract. Other revenues are typically invoiced and paid on a monthly basis. Payment terms for revenues are generally short term in nature. Leasing Arrangements —At contract inception, we evaluate whether an arrangement is or contains a lease for which we are the lessee (that is, arrangements which provide us with the right to control a physical asset for a period of time). Operating lease right-of-use (“ROU”) assets and lease liabilities are recognized in Operating lease right-of-use assets, net and Operating lease liabilities within current liabilities and non-current liabilities in our Consolidated Balance Sheets, respectively. Finance lease ROU assets are recognized in Property, plant and equipment, net and lease liabilities are recognized in Other current liabilities and Other liabilities in our Consolidated Balance Sheets. All lease liabilities are measured at the present value of the unpaid lease payments, discounted using our incremental borrowing rate based on the information available at commencement date of the lease. ROU assets, for both operating and finance leases, are initially measured based on the lease liability, adjusted for prepaid rent and lease incentives. ROU assets are subsequently measured at the carrying amount of the lease liability adjusted for prepaid or accrued lease payments and lease incentives. The finance lease ROU assets are subsequently amortized using the straight-line method. Operating lease expenses are recognized on a straight-line basis over the lease term. With respect to finance leases, amortization of the ROU asset is presented separately from interest expense related to the finance lease liability. Variable lease payments, which are primarily based on usage, are recognized when the associated activity occurs. We have elected to combine lease and non-lease components for all lease contracts where we are the lessee. Additionally, for arrangements with lease terms of 12 months or less, we do not recognize ROU assets and lease liabilities; and lease payments are recognized on a straight-line basis over the lease term with variable lease payments recognized in the period in which the obligation is incurred. Concentration of Credit Risk —We are subject to concentrations of credit risk with respect to amounts due from customers. We attempt to limit our credit risk by performing ongoing credit evaluations. We earned approximately 13 %, 12 % and 10 % of our consolidated revenue from one customer within the Jefferson Terminal segment during the years ended December 31, 2024, 2023 and 2022, respectively, and 50 %, 51 % and 51 % from one customer within the Railroad segment during the years ended December 31, 2024, 2023 and 2022, respectively. During the year ended December 31, 2024, revenues from one customer in each of the Railroad and Jefferson Terminal segments accounted for $ 165.7 million and $ 44.6 million, respectively. As of December 31, 2024, accounts receivable from two customers within the Jefferson Terminal and Railroad segments represented 48 % 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. We maintain cash and restricted cash balances, which generally exceed federally insured limits, and subject us to credit risk, in high credit quality financial institutions. We monitor the financial condition of these institutions and have not experienced any losses associated with these accounts. Allowance for Doubtful Accounts —We determine the allowance for doubtful accounts based on our assessment of the collectability of our receivables on a customer-by-customer basis. 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. 72 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) Accumulated Other Comprehensive Loss Components of accumulated other comprehensive loss at December 31, 2024 are as follows: Equity method investee Pension and other postretirement benefit accounts Total Balance at beginning of period $ ( 180,460 ) $ 1,945 $ ( 178,515 ) Other comprehensive income (loss) before reclassification ( 2,523 ) 22,490 $ 19,967 Amounts reclassified from accumulated other comprehensive loss — 1,497 $ 1,497 Net current period other comprehensive loss, net of tax ( 2,523 ) 23,987 $ 21,464 Accumulated other comprehensive loss $ ( 182,983 ) $ 25,932 $ ( 157,051 ) Reclassifications out of accumulated other comprehensive loss during 2024 were immaterial. Components of accumulated other comprehensive loss at December 31, 2023 are as follows: Equity method investee Pension and other postretirement benefit accounts Total Balance at beginning of period $ ( 304,305 ) $ 4,172 $ ( 300,133 ) Other comprehensive income (loss) before reclassification 123,845 ( 2,129 ) $ 121,716 Amounts reclassified from accumulated other comprehensive loss — ( 98 ) $ ( 98 ) Net current period other comprehensive loss, net of tax 123,845 ( 2,227 ) $ 121,618 Accumulated other comprehensive loss $ ( 180,460 ) $ 1,945 $ ( 178,515 ) Reclassifications out of accumulated other comprehensive loss during 2023 were immaterial. 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 and Combined 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 postretirement benefit accounts. Derivative Financial Instruments Electricity Derivatives — Our equity method investee, Long Ridge, enters into derivative contracts as part of a risk management program to mitigate price risk associated with certain electricity price exposures. Long Ridge primarily uses swap derivative contracts, which are agreements to buy or sell a quantity of electricity at a predetermined future date and at a predetermined price. Cash Flow Hedges 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 (loss) income related to equity method investees in our Consolidated and Combined Consolidated Statements of Comprehensive Income (Loss) 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. 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 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 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. 73 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 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. A valuation allowance is established when management believes it is more likely than not that a deferred tax asset will not be realized. Some of our entities file income tax returns in the U.S. federal jurisdiction, various state jurisdictions and in certain foreign jurisdictions. The income tax returns filed by us and our subsidiaries are subject to examination by the U.S. federal, state and foreign tax authorities. 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. 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. The pension and other postretirement obligations and the related net periodic costs are based on, among other things, assumptions regarding the discount rate, salary increases, the projected mortality of participants and the current level and future escalation of health care costs. Actuarial gains and losses occur when actual experience differs from any of the many assumptions used to value the benefit plans, or when assumptions change. We will recognize into income on an annual basis a portion of unrecognized actuarial net gains or losses that exceed 10 percent of the greater of the projected benefit obligations or the market-related value of plan assets (the corridor). This excess is amortized over the average remaining service period of active employees expected to receive benefits under the plan. Refer to Note 12 for additional discussion on the pension and postretirement benefit plans. Recent Accounting Pronouncements —In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures. This ASU requires entities to provide additional disclosures around significant segment expenses that are regularly provided to the chief operating decision maker, as well as an amount and description of its composition of other segment items. This standard is effective retrospectively for all public entities for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. We adopted this guidance in the fourth quarter of 2024, and it did not have a material impact on our consolidated and combined consolidated financial statements and related disclosures. Unadopted Accounting Pronouncements —In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures. This ASU enhances the transparency and decision usefulness of income tax disclosures by expanding the disclosures of an entity’s income tax rate reconciliation and disaggregation of income taxes paid and income tax expense. This standard is effective prospectively for all public entities for annual periods beginning after December 15, 2024, with early adoption and retrospective application permitted. We are currently assessing the impact this guidance will have on our consolidated and combined consolidated financial statements and related disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This ASU requires additional financial statement disclosures for disaggregated information of certain expense line items on the face of the income statement, including purchases of inventory, employee compensation, depreciation, intangible asset amortization and depreciation, depletion and amortization of capitalized costs recognized as part of oil- and gas-producing activities. This standard is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption and either prospective or retrospective application permitted. We are currently assessing the impact this guidance will have on our consolidated and combined consolidated financial statements and related disclosures. 3. LEASING EQUIPMENT, NET Leasing equipment, net is summarized as follows: December 31, 2024 2023 Leasing equipment $ 49,262 $ 45,982 Less: Accumulated depreciation ( 11,809 ) ( 10,395 ) Leasing equipment, net $ 37,453 $ 35,587 Depreciation expense for leasing equipment is summarized as follows: Year Ended December 31, 2024 2023 2022 Depreciation expense for leasing equipment $ 1,422 $ 1,148 $ 1,105 74 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (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 certain employees 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 and Combined Consolidated Statements of Operations during the year ended December 31, 2023. We also recorded $ 0.8 million and $ 0.1 million of interest income which is included in Revenues in the Consolidated and Combined Consolidated Statements of Operations during the year ended December 31, 2024 and 2023, respectively. As of December 31, 2024 and 2023, we recorded $ 8.1 million and $ 7.9 million of lease receivable and $ 0.8 million and $ 0.6 million of unguaranteed residual value which are included in Other assets on the Consolidated Balance Sheets, as well as $ 0.8 million and $ 0.8 million of short-term lease receivable which is included in Other current assets on the Consolidated Balance Sheets, respectively. The following table presents future minimum lease payments under the sales-type lease as of December 31, 2024: 2025 $ 780 2026 780 2027 780 2028 780 2029 780 Thereafter 20,280 Total undiscounted lease payments 24,180 Less: Imputed interest 15,299 Total lease receivable $ 8,881 4. PROPERTY, PLANT AND EQUIPMENT, NET Property, plant and equipment, net is summarized as follows: December 31, 2024 2023 Land, site improvements and rights $ 181,874 $ 182,319 Buildings and improvements 19,015 18,769 Bridges and tunnels 176,753 176,753 Terminal machinery and equipment 1,211,272 1,215,197 Track and track related assets 109,871 103,888 Railroad equipment 9,627 8,999 Railcars and locomotives 95,437 85,162 Computer hardware and software 20,682 16,058 Furniture and fixtures 2,246 1,887 Construction in progress 153,244 76,491 Other 24,183 21,613 2,004,204 1,907,136 Less: Accumulated depreciation ( 350,736 ) ( 276,307 ) Property, plant and equipment, net $ 1,653,468 $ 1,630,829 We had net additions of property, plant and equipment of $ 97.1 million and $ 27.3 million during the years ended December 31, 2024 and 2023, respectively, which primarily consisted of machinery and equipment placed in service or under development at Jefferson Terminal and Repauno, as well as railcars purchased at Transtar. During the year ended December 31, 2023, $ 5.0 million of track and bridges was purchased by Transtar from Long Ridge Energy & Power LLC, our equity method investment. Long Ridge Energy & Power LLC recorded a $ 2.2 million gain on sale of assets, which was eliminated upon equity pick-up (see Note 5). 75 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) Depreciation expense for property, plant and equipment was $ 71.6 million, $ 72.3 million, and $ 62.1 million for the years ended December 31, 2024, 2023 and 2022, respectively. 5. INVESTMENTS The following table presents the ownership interests and carrying values of our investments: Carrying Value Investment Ownership Percentage December 31, 2024 December 31, 2023 Intermodal Finance I, Ltd. Equity method 51.0 % $ — $ — Long Ridge Energy & Power LLC (1) Equity method 50.1 % — — Long Ridge West Virginia LLC Equity method 50.1 % 116 6,825 GM-FTAI Holdco LLC Equity method See below — 55,740 Clean Planet Energy USA LLC Equity method 50.0 % 12,413 10,136 $ 12,529 $ 72,701 ______________________________________________________________________________________ (1) The carrying value of $( 18.2 ) million and $( 29.3 ) million as of December 31, 2024 and 2023, respectively, is included in Other liabilities in the Consolidated Balance Sheets. We did not recognize any other-than-temporary impairments for the years ended December 31, 2024, 2023 and 2022. The following table presents our proportionate share of equity in earnings (losses): Year Ended December 31, 2024 2023 2022 Intermodal Finance I, Ltd. $ 40 $ 56 $ 151 Long Ridge Energy & Power LLC ( 29,950 ) ( 9,556 ) ( 60,538 ) Long Ridge West Virginia LLC ( 7,196 ) ( 393 ) — GM-FTAI Holdco LLC ( 17,052 ) ( 12,285 ) ( 5,571 ) Clean Planet Energy USA LLC ( 1,338 ) ( 2,529 ) ( 1,441 ) Total $ ( 55,496 ) $ ( 24,707 ) $ ( 67,399 ) Equity Method Investments Intermodal Finance I, Ltd. In 2012, we acquired a 51 % non-controlling interest in Intermodal Finance I, Ltd. (“Intermodal”). Intermodal is governed by a board of directors, and its shareholders have voting rights through their equity interests. As such, Intermodal is not within the scope of ASC 810-20 and should be evaluated for consolidation under the voting interest model. Due to the existence of substantive participating rights of the 49 % equity investor, including the joint approval of material operating and capital decisions, such as material contracts and capital expenditures consistent with ASC 810-10-25-11, we do not have unilateral rights over this investment and, therefore, we do not consolidate Intermodal but account for this investment in accordance with the equity method. 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 December 31, 2024, Intermodal owns a portfolio of approximately 134 shipping containers subject to multiple operating leases. Long Ridge Energy & Power LLC In December 2019, Ohio River Partners Shareholder LLC (“ORP”), a wholly owned subsidiary, contributed its equity interests in Long Ridge into Long Ridge Energy & Power LLC and sold a 49.9 % interest (the “Long Ridge Transaction”) for $ 150.0 million in cash, plus an earn out. We no longer have a controlling interest in Long Ridge but still maintain significant influence through our retained interest and, therefore, now account for this investment in accordance with the equity method. Following the sale, we deconsolidated ORP, which held the assets of Long Ridge. 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. During 2023, the maturity date was extended to May 1, 2032. The Company made an additional $ 31.4 million of investment in Long Ridge as part of the shareholder loan agreement during the year ended December 31, 2024. As of December 31, 2024 and 2023, the balance of the note receivable was $ 114.8 million and $ 71.0 million, respectively, recorded as part of the Long Ridge investment in Other liabilities on the Consolidated Balance Sheets. 76 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) The tables below present summarized fin ancial information for Long Ridge Energy & Power LLC: December 31, Balance Sheet 2024 2023 Assets Current assets: Cash and cash equivalents $ 1,511 $ 3,362 Restricted cash 20,284 23,691 Accounts receivable, net 6,889 5,633 Other current assets 6,229 7,357 Total current assets 34,913 40,043 Property, plant, and equipment, net 805,720 828,232 Intangible assets, net 3,800 4,180 Goodwill 86,460 86,460 Other assets 5,286 4,041 Total assets $ 936,179 $ 962,956 Liabilities Current liabilities: Accounts payable and accrued liabilities $ 31,453 $ 49,538 Debt, net 4,450 4,450 Derivative liabilities 57,870 39,891 Other current liabilities 299 2,136 Total current liabilities 94,072 96,015 Debt, net 754,658 699,372 Derivative liabilities 348,203 360,710 Other liabilities 2,750 4,941 Total liabilities 1,199,683 1,161,038 Equity Total equity ( 263,504 ) ( 198,082 ) Total liabilities and equity $ 936,179 $ 962,956 Year Ended December 31, Statement of Operations 2024 2023 2022 Revenue $ 110,200 $ 154,290 $ 50,230 Expenses Operating expenses 53,811 61,154 61,835 Depreciation and amortization 47,199 49,502 51,243 Interest expense 70,178 61,332 53,409 Total expenses 171,188 171,988 166,487 Other income (expense) 604 801 ( 4,577 ) Net loss $ ( 60,384 ) $ ( 16,897 ) $ ( 120,834 ) GM-FTAI Holdco LLC In September 2021, we acquired 1 % of the Class A shares and 50 % of the Class B shares of GM-FTAI Holdco LLC for $ 52.5 million. GM-FTAI Holdco LLC owns a 100 % interest in Gladieux Metals Recycling LLC (“GMR”) and Aleon Renewable Metals LLC (“Aleon”). GMR specializes in recycling spent catalyst produced in the petroleum refining industry. 77 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) Aleon plans to develop a lithium-ion battery recycling business across the United States. Each planned location will collect, discharge and disassemble lithium-ion batteries to extract various metals in high-purity form for resale into the lithium-ion battery production market. Aleon and GMR are governed by separate boards of directors. Our ownership of Class A and B shares in GM-FTAI Holdco LLC provides us with 1 % and 50 % economic interest in GMR and Aleon, respectively. We account for our investment in GM-FTAI Holdco LLC as an equity method investment as we have significant influence through our ownership of Class A and Class B shares of GM-FTAI Holdco LLC. 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 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. During the year ended December 31, 2024, GM-FTAI Holdco LLC was impacted by severe weather which damaged its facilities and impacted production capabilities. Additionally, GM-FTAI Holdco LLC continues to generate operating losses and has not achieved expected results. Therefore, the Company determined that the equity value should be fully written off of the Consolidated Balance Sheet as of December 31, 2024. The related impairment charge is recorded in Asset impairment charges in the Consolidated and Combined Consolidated Statements of Operations for the year ended December 31, 2024. Clean Planet Energy USA LLC In November 2021, we acquired 50 % of the Class A shares of Clean Planet Energy USA LLC (“CPE” or “Clean Planet”) with an initial investment of $ 1.0 million. CPE intends on building waste plastic-to-fuel plants in the United States. The plants will convert various grades of non-recyclable waste plastic to renewable diesel in the form of jet fuel, diesel, naphtha, and low sulfur fuel oil. 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 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 December 31, 2024, the investment of $ 5.0 million was recorded in Other assets on the Consolidated Balance Sheet. 78 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 6. INTANGIBLE ASSETS, NET I ntangible assets, net are summarized as follows: December 31, 2024 Jefferson Terminal Railroad Total Customer relationships $ 35,513 $ 60,000 $ 95,513 Less: Accumulated amortization ( 35,513 ) ( 13,771 ) ( 49,284 ) Total intangible assets, net $ — $ 46,229 $ 46,229 December 31, 2023 Jefferson Terminal Railroad Total Customer relationships $ 35,513 $ 60,000 $ 95,513 Less: Accumulated amortization ( 33,145 ) ( 9,747 ) ( 42,892 ) Total intangible assets, net $ 2,368 $ 50,253 $ 52,621 Amortization of customer relationships is included in Depreciation and amortization in the Consolidated and Combined Consolidated Statements of Operations and is as follows: Classification in Consolidated and Combined Consolidated Statements of Operations Year Ended December 31, 2024 2023 2022 Customer relationships Depreciation and amortization $ 6,380 $ 7,574 $ 7,542 Estimated net annual amortization of intangibles is as follows: 2025 $ 4,000 2026 4,000 2027 4,000 2028 4,000 2029 4,000 Thereafter 26,229 Total $ 46,229 79 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 7. DEBT, NET Our debt, net is summarized as follows: Outstanding Borrowings Stated Interest Rate Maturity Date December 31, 2024 December 31, 2023 Loans payable DRP Revolver (1) (i) Base Rate + 3.00 %; or (ii) Base Rate + 4.00 % (Term SOFR) 11/5/26 $ 44,250 $ 44,250 EB-5 Loan Agreement 5.75 % (i) 1/25/26 (ii) 3/11/26 (iii) 11/26/27 63,800 63,800 Jefferson Credit Agreement (2) (i) Base Rate + 3.00 %; or (ii) Base Rate + 4.00 % (Term SOFR) 7/18/25 49,056 — Total loans payable 157,106 108,050 Bonds payable Series 2020 Bonds (i) Tax Exempt Series 2020A Bonds: 3.625 % (ii) Tax Exempt Series 2020A Bonds: 4.00 % (i) 1/1/35 (ii) 1/1/50 143,165 263,980 Series 2021 Bonds (i) Tax Exempt Series 2021A Bonds: 1.875 % to 3.00 % (ii) Taxable Series 2021B Bonds: 4.10 % (i) 1/1/26 to 1/1/50 (ii) 1/1/28 352,685 425,000 Series 2024 Bonds (i) Tax Exempt Series 2024A Bonds: 5.000 % to 5.250 % (ii) Taxable Series 2024B Bonds: 10.000 % (i) 1/1/39 to 1/1/54 (ii) 7/1/26 368,513 — Senior Notes due 2027 (2) 10.500 % 6/1/27 581,169 575,181 Total bonds payable 1,445,532 1,264,161 Total debt 1,602,638 1,372,211 Less: Debt issuance costs ( 14,803 ) ( 31,301 ) Total debt, net $ 1,587,835 $ 1,340,910 Total principal debt due within one year $ 50,000 $ — ______________________________________________________________________________________ (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) Includes an unamortized discount of $ 33,557 and $ 24,819 at December 31, 2024 and 2023, respectively. DRP Revolver —On November 5, 2018, our subsidiary entered into a revolving credit facility (the “DRP Revolver”) that provides for revolving loans in the aggregate amount of $ 25.0 million. The DRP Revolver is secured by the capital stock of certain of our direct subsidiaries as defined in the related credit agreement. On November 5, 2021, we entered into an amendment to the DRP Revolver, which extended the maturity date under the DRP Revolver to November 5, 2024. On December 22, 2023, we entered into a second amendment to the DRP Revolver which increased the aggregate revolving facility by $ 25.0 million from $ 25.0 million to $ 50.0 million and extended the maturity date under the DRP Revolver to November 5, 2026. The DRP Revolver includes financial covenants requiring the maintenance of (i) consolidated cash balance of at least $ 3.0 million at each quarter end date, and (ii) consolidated tangible net worth of at least $ 180.0 million at each quarter end date in 2022, $ 190.0 million in 2023, and $ 200.0 million thereafter. EB-5 Loan Agreement —On January 25, 2021, Jefferson Terminal entered into a non-recourse loan agreement under the U.S. Citizenship and Immigration Services EB-5 Program (“EB-5 Loan Agreement”) to pay for the development, construction and acquisition of certain facilities at Jefferson Terminal. The maximum aggregate principal amount available under the EB-5 Loan Agreement is $ 61.2 million, of which $ 26.1 million was available under the first tranche and $ 35.1 million was available under the second tranche. The loans mature in five years from the funding of each individual tranche with an option to extend the maturity for both tranches by two one-year periods. If the option to extend the maturity is exercised, the interest rate will increase to 6.25 % from 5.75 % for the extension period. 80 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) On March 11, 2022, Jefferson Terminal entered into a new EB-5 loan agreement (“EB-5.2 Loan Agreement”). This loan was issued with substantially the same terms as the EB-5 Loan Agreement discussed above and matures in four years from the funding date. The maximum aggregate principal amount available under the EB-5.2 Loan Agreement is $ 9.7 million. On November 16, 2022, Jefferson Terminal entered into a new EB-5 loan agreement (“EB-5.3 Loan Agreement”). This loan was issued with substantially the same terms as the EB-5 Loan Agreement discussed above and matures in five years from the funding date. The maximum aggregate principal amount available under the EB-5.3 Loan Agreement is $ 28.0 million. 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. The Transtar Revolver was guaranteed by the Company and certain subsidiaries of Transtar including a pledge of substantially all of their respective assets. The Transtar Revolver included financial covenants requiring the maintenance of (i) a consolidated maximum ratio of total leverage of 3.00 to 1.00 per the terms of the credit agreement and (ii) a consolidated minimum fixed charge coverage ratio of 1.20 to 1.00 per the terms of the credit agreement. 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 in the Consolidated and Combined Consolidated Statements of Operations during the year ended December 31, 2023 . Series 2020 Bonds —On February 11, 2020, Jefferson Terminal issued Series 2020 Bonds in an aggregate principal amount of $ 264.0 million (“Jefferson Refinancing”). The Series 2020 Bonds are designated as $ 184.9 million of Series 2020A Dock and Wharf Facility Revenue Bonds (the “Tax Exempt Series 2020A Bonds”), and $ 79.1 million of Series 2020B Taxable Facility Revenue Bonds (the “Taxable Series 2020B Bonds”). The Tax Exempt Series 2020A Bonds maturing on January 1, 2035 ($ 53.5 million aggregate principal amount) bear interest at a fixed rate of 3.625 %. The Tax Exempt Series 2020A Bonds maturing on January 1, 2050 ($ 131.4 million aggregate principal amount) bear interest at a fixed rate of 4.00 %. The Taxable Series 2020B Bonds will mature on January 1, 2025 and bear interest at a fixed rate of 6.00 %. Jefferson Terminal used a portion of the net proceeds from this offering to refund, redeem and defease certain indebtedness, and used a portion of the net proceeds to pay for or reimburse the cost of development, construction and acquisition of certain facilities, to fund certain reserve and funded interest accounts related to the Series 2020 Bonds, and to pay for or reimburse certain costs of issuance of the Series 2020 Bonds. Series 2021 Bonds —On August 18, 2021, Jefferson Terminal issued $ 425.0 million aggregate principal amount of Series 2021 Bonds, which are designated as $ 225.0 million of Series 2021A Dock and Wharf Facility Revenue Bonds (the “Series 2021A Bonds”) and $ 200.0 million of Series 2021B Taxable Facility Revenue Bonds (the “Taxable Series 2021B Bonds”). The Series 2021A Bonds consist of: i) $ 39.1 million aggregate principal amount of Serial Bonds maturing between January 1, 2026 and January 1, 2031, and bearing interest at specified fixed rates ranging from 1.875 % to 2.625 % per annum, ii) $ 38.2 million aggregate principal amount of Term Bonds maturing January 1, 2036, and bearing interest at a fixed rate of 2.750 % per annum, iii) $ 44.9 million aggregate principal amount of Term Bonds maturing January 1, 2041, and bearing interest at a fixed rate of 2.875 % per annum, and iv) $ 102.8 million aggregate principal amount of Term Bonds maturing January 1, 2050, and bearing interest at a fixed rate of 3.00 % per annum. The Taxable Series 2021B Bonds will mature on January 1, 2028, and bear interest at a fixed rate of 4.100 % per annum. Jefferson Terminal has used a portion of the net proceeds to pay for or reimburse the cost of development, construction and acquisition of certain facilities. Credit Agreement On May 18, 2023, we entered into a credit agreement, which provided 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 in the Consolidated and Combined Consolidated Statements of Operations during the year ended December 31, 2023. 81 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) Senior Notes due 2027 —In connection with the spin-off, we issued $ 500.0 million aggregate principal amount of Senior Notes due 2027 (the “2027 Notes”). The 2027 Notes bear interest at a rate of 10.500 % per annum, payable semi-annually in arrears on June 1 and December 1 of each year, commencing on December 1, 2022. The 2027 Notes were issued at an issue price equal to 94.585 %. The 2027 Notes are guaranteed by the Company and the subsidiaries of Transtar including a pledge of substantially all of their respective assets. 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. April 2024 Jefferson Credit Agreement On April 2, 2024, certain subsidiaries within the Jefferson Terminal segment entered into a credit agreement (the “April 2024 Jefferson 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. In June 2024, we completed an offering of Series 2024 Bonds (see below) and used a portion of the net proceeds to repay in full and terminate the April 2024 Jefferson Credit Agreement. October 2024 Jefferson Credit Agreement On October 18, 2024, our Jefferson Terminal segment entered into a credit agreement (the “October 2024 Jefferson Credit Agreement”), providing for a $ 50.0 million term loan facility, which matures at the earlier of (i) July 18, 2025 or (ii) after December 31, 2024, the date on which a cash dividend payment on our preferred stock is paid or is required to be paid pursuant to the terms of such preferred stock, and bears interest at 4.00 % plus the applicable forward-looking term rate based on SOFR. Tender Offer for Series 2020A and Series 2021A Bonds On May 14, 2024, we commenced a cash tender offer (the “Tender Offer”) for up to $ 105 million aggregate principal amount of the Tax Exempt Series 2020A and Tax Exempt Series 2021A Bonds (the “Target Bonds”). On June 20, 2024 (the “Settlement Date”), we completed the Tender Offer for $ 108.0 million aggregate principal amount of the Target Bonds under the Tender Offer at an aggregate purchase price of $ 88.8 million , which includes accrued and unpaid interest on such Target Bonds from the last interest payment date up to, but not including, the Settlement Date. Interest ceased to accrue on the Settlement Date for all accepted Target Bonds. On August 30, 2024, we repurchased and cancelled an additional $ 6.0 million of the Tax Exempt Series 2021A Bonds. We wrote off $ 0.2 million of deferred financing costs during the period and recognized a gain on extinguishment of debt of $ 0.9 million from this transaction in the Consolidated and Combined Consolidated Statements of Operations during the year ended December 31, 2024 . Series 2024 Bonds On June 20, 2024, certain subsidiaries within the Jefferson Terminal segment, and the Port of Beaumont Navigation District of Jefferson County, Texas, completed their previously announced offering of $ 164.4 million principal amount of Series 2024A Dock and Wharf Facility Revenue Bonds (the “Tax Exempt Series 2024A Bonds”) and $ 217.9 million principal amount of Taxable Series 2024B Facility Revenue Bonds (the “Taxable Series 2024B Bonds” and, together with the Tax Exempt Series 2024A Bonds, the “Series 2024 Bonds”). Certain subsidiaries within the Jefferson Terminal segment pledged certain assets in support of the Series 2024 Bonds. The Tax Exempt Series 2024A Bonds consist of: • $ 67,570,000 principal amount of Term Bonds maturing on January 1, 2039, and bearing interest at a fixed rate of 5.000 % per annum, • $ 44,800,000 principal amount of Term Bonds maturing on January 1, 2044, and bearing interest at a fixed rate of 5.125 % per annum, and • $ 52,055,000 principal amount of Term Bonds maturing on January 1, 2054, and bearing interest at a fixed rate of 5.250 % per annum. The Taxable Series 2024B Bonds will mature on July 1, 2026, and bear interest at a fixed rate of 10.000 % per annum. Jefferson Terminal used a portion of the net proceeds from the Series 2024 Bonds to repay the April 2024 Jefferson Credit Agreement in full, pay for or reimburse the cost of development, construction and acquisition of certain facilities, as well as pay for the Tender Offer. The Company also used a portion of the net proceeds from the Taxable Series 2024B Bonds to defease the Taxable Series 2020B Bonds in full for the aggregate principal amount of $ 79.1 million. We recognized a loss on modification of debt of $ 6.0 million from the Series 2024 Bonds and a loss on extinguishment of debt of $ 3.2 million from the repayment of the April 2024 Jefferson Credit Agreement in connection with this transaction. For the year ended December 31, 2024, we recognized an additional loss on extinguishment of debt of $ 0.6 million from the repayment of the April 2024 Jefferson Credit 82 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) Agreement. In conjunction with the repayment associated with the April 2024 Jefferson Credit Agreement, we wrote off $ 1.8 million of deferred financing costs during the period. We were in compliance with all debt covenants as of December 31, 2024. As of December 31, 2024, scheduled principal repayments under our debt agreements for the next five years and thereafter are summarized as follows: 2025 2026 2027 2028 2029 Thereafter Total DRP Revolver $ — $ 44,250 $ — $ — $ — $ — $ 44,250 EB-5 Loan Agreement — 35,800 28,000 — — — 63,800 Jefferson Credit Agreement 50,000 — — — — — 50,000 Series 2020 Bonds — 1,590 2,165 2,770 360 136,280 143,165 Series 2021 Bonds — 9,025 4,750 205,415 6,120 127,375 352,685 Series 2024 Bonds — 217,870 — 740 3,745 159,940 382,295 Senior Notes due 2027 — — 600,000 — — — 600,000 Total principal payments on loans and bonds payable $ 50,000 $ 308,535 $ 634,915 $ 208,925 $ 10,225 $ 423,595 $ 1,636,195 8. FAIR VALUE MEASUREMENTS Fair value measurements and disclosures require the use of valuation techniques to measure fair value that maximize the use of observable inputs and minimize use of unobservable inputs. These inputs are prioritized as follows: • Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities. • Level 2: Inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities or market corroborated inputs. • Level 3: Unobservable inputs for which there is little or no market data and which require us to develop our own assumptions about how market participants price the asset or liability. The valuation techniques that may be used to measure fair value are as follows: • Market approach—Uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. • Income approach—Uses valuation techniques to convert future amounts to a single present amount based on current market expectations about those future amounts. • Cost approach—Based on the amount that currently would be required to replace the service capacity of an asset (replacement cost). 83 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) The following tables set forth our financial assets measured at fair value on a recurring basis 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 December 31, 2024 December 31, 2024 Total Level 1 Level 2 Level 3 Valuation Technique Assets Cash and cash equivalents $ 27,785 $ 27,785 $ — $ — Market Restricted cash and cash equivalents 119,511 119,511 — — Market Notes receivable 11,893 — 11,893 — Market Total assets $ 159,189 $ 147,296 $ 11,893 $ — Fair Value as of Fair Value Measurements Using Fair Value Hierarchy as of December 31, 2023 December 31, 2023 Total Level 1 Level 2 Level 3 Valuation Technique Assets Cash and cash equivalents $ 29,367 $ 29,367 $ — $ — Market Restricted cash and cash equivalents 58,112 58,112 — — Market Notes receivable 11,664 — 11,664 — Market Total assets $ 99,143 $ 87,479 $ 11,664 $ — Our cash and cash equivalents and restricted cash and cash equivalents 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. Except as discussed below, our financial instruments other than cash and cash equivalents and restricted cash and cash equivalents consist principally of accounts receivable, notes receivable, accounts payable and accrued liabilities, and loans 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, notes payable and loans payable reported as Debt, net in the Consolidated Balance Sheets are presented in the table below: December 31, 2024 2023 Series 2020A Bonds (1) $ 122,978 $ 138,666 Series 2020B Bonds (1) — 75,928 Series 2021A Bonds (1) 121,678 154,306 Series 2021B Bonds (1) 179,316 165,208 Series 2024A Bonds (1) 167,291 — Series 2024B Bonds (1) 222,609 — Senior Notes due 2027 642,036 625,038 EB-5 Loan Agreement 23,208 21,240 EB-5.2 Loan Agreement 8,799 8,183 EB-5.3 Loan Agreement 23,583 22,491 ______________________________________________________________________________________ (1) Fair value is based upon market prices for similar municipal securities. The fair value of all other items reported as Debt, net in the Consolidated Balance Sheets approximate their carrying values due to their bearing market rates of interest and are classified as Level 2 within the fair value hierarchy. 84 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) We measure the fair value of certain assets on a non-recurring basis when U.S. GAAP requires the application of fair value, including events or changes in circumstances that indicate that the carrying amounts of assets may not be recoverable. Assets subject to these measurements include goodwill, intangible assets, property, plant and equipment and leasing equipment. We record such assets at fair value when it is determined the carrying value may not be recoverable. Fair value measurements for assets subject to impairment tests are based on an income approach which uses Level 3 inputs, which include our assumptions as to future cash flows from operation of the underlying businesses. 9. REVENUES We disaggregate our revenue from contracts with customers by products and services provided for each of our segments, as we believe it best depicts the nature, amount, timing and uncertainty of our revenue. Revenues are within the scope of ASC 606, Revenue from Contracts with Customers , unless otherwise noted. We have elected to exclude sales and other similar taxes from revenues. Year Ended December 31, 2024 Ports and Terminals Railroad Jefferson Terminal Repauno Corporate and Other Total Lease income $ 1,784 $ 3,179 $ — $ — $ 4,963 Rail revenues 178,243 — — — 178,243 Terminal services revenues — 77,467 15,792 — 93,259 Roadside services revenues — — — 55,000 55,000 Other revenue — — 32 — 32 Total revenues $ 180,027 $ 80,646 $ 15,824 $ 55,000 $ 331,497 Year Ended December 31, 2023 Ports and Terminals Railroad Jefferson Terminal Repauno Corporate and Other Total Lease income $ 1,652 $ 1,437 $ — $ — $ 3,089 Rail revenues 167,793 — — — 167,793 Terminal services revenues — 70,709 12,641 — 83,350 Roadside services revenues — — — 68,190 68,190 Other revenue — — ( 1,950 ) — ( 1,950 ) Total revenues $ 169,445 $ 72,146 $ 10,691 $ 68,190 $ 320,472 Year Ended December 31, 2022 Ports and Terminals Railroad Jefferson Terminal Repauno Corporate and Other Total Lease income $ 1,943 $ 1,278 $ — $ — $ 3,221 Rail revenues 147,718 — 86 — 147,804 Terminal services revenues — 59,011 563 — 59,574 Roadside services revenues — — — 47,899 47,899 Other revenue — — 3,468 — 3,468 Total revenues $ 149,661 $ 60,289 $ 4,117 $ 47,899 $ 261,966 85 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) Presented below are the contracted minimum future annual revenues to be received under existing operating leases within the Jefferson Terminal segment as of December 31, 2024: Operating Leases 2025 $ 714 2026 421 2027 — 2028 — 2029 — Thereafter — Total $ 1,135 As of December 31, 2024, we recorded capitalized contract cost of $ 23.5 million, of which $ 4.9 million is included in Other current assets and $ 18.6 million is included in Other assets on the Consolidated Balance Sheets. Capitalized contract cost is amortized using the straight-line method, over the expected contract term. We recorded $ 4.5 million of amortization which is included in Operating expenses in the Consolidated and Combined Consolidated Statements of Operations during the year ended December 31, 2024. 10. LEASES We have commitments as lessees under lease agreements primarily for real estate, equipment and vehicles. Our leases have remaining lease terms ranging from approximately two months to 49.4 years. The following table presents lease-related costs: Year Ended December 31, 2024 2023 2022 Finance leases Amortization of right-of-use assets $ 1,169 $ 1,102 $ 945 Interest on lease liabilities 174 79 52 Finance lease expense 1,343 1,181 997 Operating lease expense 7,696 7,619 7,306 Short-term lease expense 1,976 2,617 1,714 Variable lease expense 4,243 3,620 2,690 Total lease expense $ 15,258 $ 15,037 $ 12,707 The following table presents information related to our operating leases as of and for the years ended December 31, 2024 and 2023: December 31, 2024 2023 Right-of-use assets, net $ 67,937 $ 69,748 Short-term lease liabilities 7,172 7,218 Long-term lease liabilities 60,893 62,441 Total lease liabilities $ 68,065 $ 69,659 Weighted average remaining lease term 33.6 years 33.0 years Weighted average incremental borrowing rate 5.9 % 5.7 % 86 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) The following table presents supplemental cash flow information for the years ended December 31, 2024, 2023, and 2022: December 31, 2024 2023 2022 Cash paid for amounts included in the measurement of operating lease liabilities $ 7,437 $ 7,187 $ 7,005 Noncash - ROU assets recorded for new and modified leases 2,020 2,828 2,640 Sale Leaseback Transaction In the second quarter of 2024, Jefferson Terminal transferred land to the Port of Beaumont Navigation District of Jefferson County, Texas in association with the Tax Exempt Series 2024A Bonds. Jefferson Terminal entered into a ground lease with the Port of Beaumont Navigation District of Jefferson County, Texas on approximately 50 acres of land. Jefferson Terminal was provided access to 10 acres to begin construction of a new dock and supporting facilities. The lease of the 10 acres is an operating lease. This transaction was recorded as a sale in accordance with ASC 842. Jefferson Terminal recorded a gain on the sale leaseback through Gain (loss) on sale of assets on the Consolidated and Combined Consolidated Statements of Operations of $ 3.1 million as of December 31, 2024. Jefferson Terminal has not been provided access to the other 40 acres for construction, so the lease has not commenced. Once the Port of Beaumont Navigation District of Jefferson County, Texas provides access to the property for construction, the 40 acres will be reassessed as a sale leaseback. This transaction was recorded as a failed sale in accordance with ASC 842 as of December 31, 2024. Jefferson Terminal recorded a finance liability of $ 12.0 million through Other liabilities on the Consolidated Balance Sheets as of December 31, 2024 for the failed sale. The following table presents future minimum lease payments under non-cancellable operating leases as of December 31, 2024: 2025 $ 7,197 2026 6,532 2027 6,003 2028 5,261 2029 4,187 Thereafter 134,771 Total undiscounted lease payments 163,951 Less: Imputed interest 95,886 Total lease liabilities $ 68,065 11. 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 December 31, 2024, the Incentive Plan provides for the issuance of up to 30.0 million shar es. We account for equity-based compensation expense in accordance with ASC 718, Compensation-Stock Compensation and we report equity-based compensation within Operating expenses and General and administrative in the Consolidated and Combined Consolidated Statements of Operations. Subsidiary Stock-Based Compensation The following table presents the expense related to our subsidiary stock-based compensation arrangements recognized in the Consolidated and Combined Consolidated Statements of Operations: Year Ended December 31, Remaining Expense To Be Recognized, If All Vesting Conditions Are Met Weighted Average Remaining Contractual Term (in years) 2024 2023 2022 Restricted shares $ 399 $ 949 $ 2,020 $ 440 0.8 Common units 1,801 1,812 2,126 2,319 1.4 Total $ 2,200 $ 2,761 $ 4,146 $ 2,759 87 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) Restricted Stock Units to Subsidiary Employees 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. During the year ended December 31, 2024, we issued additional RSUs of our common stock that had a grant date fair value of $ 1.9 million. The following table presents the expense related to our RSUs to subsidiary employees recognized in the Consolidated and Combined Consolidated Statements of Operations: Expense Recognized During the Year Ended December 31, Remaining Expense To Be Recognized, If All Vesting Conditions Are Met Weighted Average Remaining Contractual Term (in years) 2024 2023 2022 Restricted stock units $ 6,341 $ 6,268 $ — $ 2,634 0.5 Total $ 6,341 $ 6,268 $ — $ 2,634 The following tables present information for our stock options, restricted shares of our subsidiary, common units of our subsidiary and restricted stock units to subsidiary employees: Stock Options Restricted Shares Common Units Restricted Stock Units Options Weighted Average Exercise Price Shares Weighted Average Issuance Price Units Weighted Average Issuance Price Units Weighted Average Issuance Price Outstanding as of December 31, 2023 16,542,751 $ 2.76 — $ — 2,047,101 $ 1.11 3,199,087 $ 3.51 Granted — — 839,264 1.00 1,995,000 1.36 192,234 9.94 Less: exercised or vested 12,436,663 2.62 119,160 1.00 1,712,696 1.21 1,712,309 3.92 Less: forfeited and canceled — — — — 585,042 1.00 77,107 3.51 Outstanding as of December 31, 2024 4,106,088 720,104 1,744,363 1,601,905 Stock Options Restricted Shares Common Units Restricted Stock Units As of December 31, 2024: Weighted average exercise / issuance price (per share) $ 2.62 $ 1.00 $ 1.34 $ 3.84 Aggregate intrinsic value (in thousands) $ 10,771 $ 720 $ 2,336 $ 6,153 Weighted average remaining contractual term 7.6 years 0.8 years 1.4 years 0.5 years During the year ended December 31, 2024, certain of the Manager’s employees, as well as certain directors and officers, exercised 12,436,663 options at a weighted average exercise price of $ 2.62 and received a net 8,891,246 shares of our common stock. Stock Options In connection with the spin-off and our redeemable preferred stock raise (see Notes 14, 16 and 17 for details), we granted options to purchase our common stock to the Manager. The fair value of these options of $ 18 million, calculated using a binomial lattice model at issuance date, was recorded as an increase in equity with an offsetting reduction of proceeds received. 88 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) The following table presents information related to the options to purchase our common stock: Number of options 10,869,565 Fair value at grant date ($ millions) $ 18.1 Expected volatility The expected stock volatility is based on an assessment of the volatility of our publicly traded common stock. 60.00 % Risk free interest rate The risk-free rate is determined using the implied yield currently available on U.S. government bonds with a term consistent with the expected term on the date of grant. 2.58 % Expected dividend yield The expected dividend yield is based on management’s expected dividend rate. 3.60 % Early exercise multiple Assumption that options will be exercised when the share price to strike price ratio reaches a certain threshold. 2.5 Expected term Expected term used represents the period of time the options granted are expected to be outstanding. 10.0 years Number of time steps The number of time steps between the valuation and expiration dates. 1,000 During the years ended December 31, 2024 and 2023, the Manager transferre d — and 2,173,914 of its options to certain employees of the Manager, respectively. Restricted Shares We issued restricted shares of our subsidiary to certain employees during the year ended December 31, 2021 that had a grant date fair value of $ 5.6 million, and generally vest over three years . These awards are subject to continued employment, and the compensation expense is recognized ratably over the vesting peri ods. The fair value of these awards was based on the fair value of the operating subsidiary on each grant date, which was estimated using a discounted cash flow analysis that requires the application of discount factors and terminal multiples to projected cash flows. Discount factors and terminal multiples were based on market-based inputs and transactions, as available at the measurement date. The grant for restricted stock units to subsidiary employees fully canceled and replaced these vested and unvested restricted shares of our subsidiary issued in the first quarter of 2021. During the year ended December 31, 2024, we issued restricted shares of our subsidiary that had a grant date fair value of $ 0.8 million and generally vest over three years. These awards are subject to continued employment, and the compensation expense is recognized ratably over the vesting peri ods. The fair value of these awards was based on the fair value of the operating subsidiary on each grant date, which was estimated using a discounted cash flow analysis that requires the application of discount factors and terminal multiples to projected cash flows. Discount factors and terminal multiples were based on market-based inputs and transactions, as available at the measurement date. Common Units We issued 1,995,000 and 1,243,089 common units of our subsidiaries to certain employees for the years ended December 31, 2024 and 2023, respectively, that had grant date fair values of $ 2.7 million and $ 1.6 million, respectively, and vest over three years . These awards are subject to continued employment and compensation expense is recognized ratably over the vesting periods. The fair value was based on the fair value of the operating subsidiary on the grant date, which is estimated using a discounted cash flow analysis that requires the application of discount factors and terminal multiples to projected cash flows. Discount factors and terminal multiples were based on market-based inputs and transactions, as available at the measurement date. During the year ended December 31, 2023, we issued 150,000 separate common units of our subsidiary that had a grant date fair value of $ 0.2 million and vest over three years . These awards are subject to performance targets based on EBITDA as defined in the agreements, and the total expected compensation expense is recognized ratably over the vesting periods if it is probable that the performance conditions will be met. The fair value of these awards was based on the fair value of the operating subsidiary on the grant date, which was estimated using a discounted cash flow analysis that requires the application of discount factors and terminal multiples to projected cash flows. Discount factors and terminal multiples were based on market-based inputs and transactions, as available at the measurement date. Director Compensation During the years ended December 31, 2024 and 2023 , we issued 11,062 and 46,509 shares of common stock to certain directors as compensation, respectively. 89 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 12. RETIREMENT BENEFIT PLANS 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, 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. The accumulated benefit obligation at December 31, 2024 and 2023 is $ 7.1 million and $ 4.6 million, respectively. Postretirement Benefits Our unfunded postretirement plan provides healthcare and life insurance benefits for eligible retirees of Transtar and their dependents. Depending on retirement date and employee classification, certain healthcare plans contain contribution and cost-sharing features such as deductibles and co-insurance. The remaining healthcare and life insurance plans are non-contributory. In the second quarter of 2024, we amended our postretirement benefit plan to change benefits provided to certain employees. The following table summarizes the changes in our projected benefit obligation and plan assets as of December 31, 2024 and 2023. Service costs are recorded in Operating expenses, while other net costs are recorded in Other income (expense) in the Consolidated and Combined Consolidated Statements of Operations. Year Ended December 31, 2024 2023 Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits Projected Benefit Obligation Projected benefit obligation, beginning of period $ 12,282 $ 32,604 $ 8,932 $ 28,523 Plan amendment 40 ( 21,788 ) — — Service costs 1,560 800 1,383 1,783 Interest costs 731 700 534 1,498 Actuarial losses (gains) 1,068 ( 6,570 ) 1,546 893 Benefit paid ( 197 ) ( 90 ) ( 113 ) ( 93 ) Projected benefit obligation, end of period $ 15,484 $ 5,656 $ 12,282 $ 32,604 Plan Assets Fair value of plan assets, beginning of period $ 3,188 $ — $ 1,711 $ — Actual return on plan assets 301 — 114 — Employer contributions 1,941 — 1,476 — Other benefits paid ( 197 ) — ( 113 ) — Fair value of plan assets, end of period $ 5,233 $ — $ 3,188 $ — Funded status at end of year $ ( 10,251 ) $ ( 5,656 ) $ ( 9,094 ) $ ( 32,604 ) As of December 31, 2024 and 2023, the following amounts were recognized in the Consolidated Balance Sheets: Year Ended December 31, 2024 2023 Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits Current liabilities $ — $ 143 $ — $ 531 Non-current liabilities 10,251 5,513 9,094 32,073 Net amounts recognized at end of period $ 10,251 $ 5,656 $ 9,094 $ 32,604 Our retirement plan costs for the years ended December 31, 2024, 2023 and 2022 were $ 2.1 million, $ 1.9 million and $ 2.1 million for pension benefits and $ — million , $ 3.4 million and $ 3.1 million for postretirement benefits, respectively. The following table summarizes the components of net periodic pension cost and other amounts recognized in Other comprehensive income (loss) in the Consolidated and Combined Consolidated Statements of Comprehensive (Loss) Income for the years ended December 31, 2024, 2023 and 2022: Year Ended December 31, 2024 2023 2022 Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits Prior service cost (credit) $ 40 $ ( 21,789 ) $ — $ — $ — $ 1,470 Amortization of prior service cost — 1,107 — ( 159 ) — — Actuarial loss (gain) 970 ( 6,570 ) 1,432 893 ( 2,814 ) ( 3,065 ) Amortization of actuarial gain — 390 61 — — — Total recognized in other comprehensive loss (income) $ 1,010 $ ( 26,862 ) $ 1,493 $ 734 $ ( 2,814 ) $ ( 1,595 ) Weighted-average assumptions used to determine the estimated benefit obligation and period costs as of and for the year ended December 31, 2024, 2023 and 2022 are as follows: Year Ended December 31, 2024 2023 2022 Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits Pension Benefits Postretirement Benefits Weighted-average assumptions used to determine pension benefit obligation: Discount rate 5.65 % 5.63 % 5.06 % 5.06 % 5.31 % 5.29 % Rate of compensation increase 3.50 % N/A 3.50 % N/A 3.50 % N/A Initial healthcare cost trend rate N/A 3.61 % N/A 7.50 % N/A 5.80 % Ultimate healthcare cost trend rate N/A 4.04 % N/A 4.04 % N/A 3.94 % Year ultimate healthcare cost trend rate is reached N/A 2075 N/A 2075 N/A 2075 Weighted-average assumptions used to determine net periodic pension and postretirement costs: Discount rate 5.06 % 5.50 % 5.31 % 5.29 % 3.02 % 3.00 % Expected long-term return on plan assets 5.00 % N/A N/A N/A N/A N/A Rate of compensation increases 3.50 % N/A 3.50 % N/A 3.50 % N/A Average future working lifetime 9.89 years 11.27 years 10.50 years 9.24 years 11.01 years 11.32 years Initial healthcare cost trend rate N/A 7.50 % N/A 5.80 % N/A 6.00 % Ultimate healthcare cost trend rate N/A 4.04 % N/A 3.94 % N/A 3.94 % Year ultimate healthcare cost trend rate is reached N/A 2075 N/A 2075 N/A 2075 The expected return on asset assumption is based on a forward-looking assessment of expected returns by asset class. The expected return produced by the investments within the fund is net of expected administrative expenses to be paid from the plan. The expected return assumption is also consistent with the long-term return goal of the investment policy. The following benefit payments, which reflect expected future service and compensation increases, as appropriate, are expected to be made from the Transtar defined benefit plans: Pension Benefits Postretirement Benefits 2025 $ 500 $ 146 2026 742 211 2027 1,012 238 2028 1,238 272 2029 1,446 315 Years 2030-2034 8,587 2,572 The pension plan assets are invested in accordance with the Investment Policy Statement as approved by the Investment Committee. The pension plan assets are held in a master trust that is invested in pooled separate accounts. The assets are valued at fair value and are classified as a Level 2 investment. The separate accounts are valued at fair value based on the underlying equity, fixed income, or short-term instruments held by each account. The separate accounts classified as equity or fixed income funds track the composition and performance of widely used indices and invest in instruments representative of those indices. The fair value of the holdings of each separate account are used to determine the net asset value. We expect to make $ 2.8 million of contributions to the pension plan during 2025. The targets and actual allocations for the pension plan assets as of the year ended December 31, 2024 and 2023 are as follows: Actual Target Asset Allocation 2024 2023 2024 2023 U.S. large cap equity 31 % — % 30 % — % U.S. small/mid cap equity 25 % — % 25 % — % U.S. investment grade fixed income and cash equivalents 44 % 100 % 45 % 100 % 13. INCOME TAXES The current and deferred components of the income tax (benefit) provision included in the Consolidated and Combined Consolidated Statements of Operations are as follows: Year Ended December 31, 2024 2023 2022 Current: Federal $ ( 1 ) $ 7 $ 2 State and local 1,394 447 482 Total current provision 1,393 454 484 Deferred: Federal ( 256 ) 1,082 3,824 State and local 2,176 934 154 Foreign — — 6 Total deferred provision 1,920 2,016 3,984 Total $ 3,313 $ 2,470 $ 4,468 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. federal, state and foreign corporate income tax in locations where they conduct business. 90 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) A valuation allowance has been established against our net U.S. federal and state deferred tax assets, including net operating loss carryforwards. As a result, our income tax provision is primarily related to separate company state taxes, deferred taxes for tax deductible goodwill, and deferred taxes for certain long-lived assets. Our effective tax rate differs from the U.S. 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. The difference between our reported total provision for income taxes and the U.S. federal statutory rate of 21 % is as follows: Year Ended December 31, 2024 2023 2022 U.S. federal tax at statutory rate 21.00 % 21.00 % 21.00 % State and local taxes ( 1.11 ) % 1.79 % 1.77 % Noncontrolling interest ( 1.66 ) % ( 2.17 ) % ( 2.58 ) % Deferred adjustment ( 5.17 ) % ( 3.71 ) % — % Other 0.33 % ( 0.61 ) % 0.46 % Change in valuation allowance ( 14.65 ) % ( 17.88 ) % ( 23.09 ) % Provision for income taxes ( 1.26 ) % ( 1.58 ) % ( 2.44 ) % Significant components of our deferred tax assets and liabilities are as follows: December 31, 2024 2023 Deferred tax assets: Net operating loss carryforwards $ 189,612 $ 166,668 Accrued expenses 13,331 3,385 Interest expense 84,348 58,455 Operating lease liabilities 84,774 72,612 Investment in partnerships 14,894 13,992 Other 19,062 11,324 Total deferred tax assets 406,021 326,436 Less valuation allowance ( 249,223 ) ( 215,082 ) Net deferred tax assets 156,798 111,354 Deferred tax liabilities: Fixed assets and goodwill ( 73,458 ) ( 50,462 ) Operating lease right-of-use assets ( 72,664 ) ( 63,955 ) Other ( 20,315 ) ( 2,793 ) Net deferred tax liabilities $ ( 9,639 ) $ ( 5,856 ) Deferred tax assets and liabilities are reported net in Other assets or Other liabilities in the Consolidated Balance Sheets. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences become deductible. We have analyzed our deferred tax assets and have determined, based on the weight of available evidence, that it is more likely than not that a significant portion will not be realized. Accordingly, valuation allowances have been recognized as of December 31, 2024, 2023, and 2022 of $ 249.2 million, $ 215.1 million, and $ 214.0 million, respectively, related to certain deductible temporary differences and net operating loss carryforwards. 91 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) A summary of the changes in the valuation allowance is as follows: December 31, 2024 2023 2022 Valuation allowance at beginning of period $ 215,082 $ 214,003 $ 143,604 Change due to current year losses 34,141 1,079 70,399 Valuation allowance at end of period $ 249,223 $ 215,082 $ 214,003 As of December 31, 2024, certain of our corporate subsidiaries had U.S. federal and state net operating loss carryforwards of approximately $ 843.6 million and $ 200.7 million, respectively, that are available to offset future taxable income. In regards to federal net operating loss carryforwards, $ 168.5 million of these carryforwards will begin to expire in the year 2032 and $ 675.1 million of these carryforwards have no expiration date. As for state and local net operating loss carryforwards, most of these carryforwards will expire with the earliest year of expiration being 2025. The utilization of the net operating loss carryforwards to reduce future income taxes will depend on the relevant corporate subsidiary's ability to generate sufficient taxable income prior to the expiration of the carryforward period, if any. In addition, the maximum annual use of net operating loss carryforwards may be limited after certain changes in stock ownership. As of and for the year ended December 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. federal, state, local and foreign income tax examinations by tax authorities. 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. 14. MANAGEMENT AGREEMENT AND AFFILIATE TRANSACTIONS We are externally managed by the Manager. The Manager is paid annual fees and incentive fees in exchange for advising us on various aspects of our business, formulating our investment strategies, arranging for the acquisition and disposition of assets, arranging for financing, monitoring performance, and managing our day-to-day operations, inclusive of all costs incidental thereto. In addition, the Manager may be reimbursed for various expenses incurred by the Manager on our behalf, including the costs of legal, accounting and other administrative activities. On July 31, 2022, in connection with the spin-off, we and the Manager entered into the Management Agreement with an initial term of six years . The Manager is entitled to a management fee, incentive fees (comprised of an Income Incentive Fee and a Capital Gains Incentive Fee, described below) and reimbursement of certain expenses. The management fee is determined by taking the average value of total equity (including redeemable preferred stock and excluding non-controlling interests) of the Company determined on a consolidated basis in accordance with U.S. GAAP at the end of the two most recently completed months multiplied by an annual rate of 1.50 %, and is payable monthly in arrears in cash. The Income Incentive Fee is calculated and distributable quarterly in arrears based on the pre-incentive fee net income for the immediately preceding calendar quarter (the “Income Incentive Fee”). For this purpose, pre-incentive fee net income means, with respect to a calendar quarter, net income attributable to stockholders during such quarter calculated in accordance with U.S. GAAP excluding our pro rata share of (1) realized or unrealized gains and losses, and (2) certain non-cash or one-time items, and (3) any other adjustments as may be approved by the independent directors. 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 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; and (3) 10 % of pre-incentive fee net income of the Company, if any, that exceeds 2.2223 % for portions of such quarter. These calculations will be prorated for any periods of less than three months. 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. 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. 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. 92 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 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 and combined consolidated financial statements: Year Ended December 31, 2024 2023 2022 Management fee $ 11,318 $ 12,467 $ 12,964 Income incentive fee — — — Capital gains incentive fee — — — Total $ 11,318 $ 12,467 $ 12,964 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. 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. We pay or reimburse the Manager and its affiliates for performing certain legal, accounting, due diligence tasks and other services that outside professionals or outside consultants otherwise would perform, provided that such costs and reimbursements are no greater than those which would be paid to outside professionals or consultants. The Manager is responsible for all of its other costs incident to the performance of its duties under the Management Agreement, including compensation of the Manager’s employees, rent for facilities and other “overhead” expenses; we do not reimburse the Manager for these expenses. The following table summarizes our reimbursements to the Manager: Year Ended December 31, 2024 2023 2022 Classification in the Consolidated and Combined Consolidated Statements of Operations: General and administrative $ 5,597 $ 5,598 $ 4,286 Acquisition and transaction expenses 1,452 1,222 1,067 Total $ 7,049 $ 6,820 $ 5,353 If we terminate the Management Agreement, we will generally be required to pay the Manager a termination fee. 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). 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 an amount 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. In connection with the spin-off, we issued 10.9 million options to purchase common stock to the Manager, with a term of 10 years and strike price of $ 2.76 as compensation to the Manager for services rendered in connection with the Redeemable Preferred Stock raise, as discussed in Notes 16 and 17. On August 12, 2024, 8.7 million Manager options were exercised, as discussed in Note 11. 93 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) The following table summarizes amounts due to the Manager, which are included within Accounts payable and accrued liabilities in the Consolidated Balance Sheets: December 31, 2024 2023 Accrued management fee $ 5,541 $ 6,400 Other payables 4,047 5,595 As of December 31, 2024 and 2023, there were no receivables from the Manager. Other Affiliate Transactions As of December 31, 2024 and 2023, certain employees of the Manager and their related parties collectively own an approxi mately 20 % interest in Jefferson Terminal which has been accounted for as a component of non-controlling interest in consolidated subsidiaries in the accompanying consolidated and combined consolidated financial statements. The carrying amount of this non-controlling interest as of December 31, 2024 and 2023 was $( 119.5 ) million a nd $( 78.0 ) million, respectively. In April 2024, we made a pro-rata distribution of $ 15.0 million to the non-controlling interest holders of our Jefferson Terminal segment. The following table presents the amount of this non-controlling interest share of net loss: Year Ended December 31, 2024 2023 2022 Non-controlling interest share of net loss $ ( 41,490 ) $ ( 36,918 ) $ ( 32,018 ) 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, FTAI 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 in FYX. In October 2022, we entered into a shareholder loan agreement with our equity method investee, Long Ridge. Refer to Note 5 for additional information. The Company subleases a portion of office space from an entity controlled by certain employees of the Manager since February 2023. For the year ended December 31, 2024 and 2023, the Company incurred approximat el y $ 0.5 million and $ 0.4 million o f rent and office related expenses, respectively. On May 14, 2024, certain members of Fortress management and affiliates of Mubadala Investment Company, through its wholly owned asset management subsidiary, Mubadala Capital (“Mubadala”), completed their acquisition of 100% of the equity of Fortress. Fortress continues to operate as an independent investment manager under the Fortress brand, with autonomy over investment processes and decision making, personnel and operations. 15. 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 and other costs on pension and other post-employment benefits (“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. All segment data and related disclosures for earlier periods presented herein have been recast to reflect this segment reporting structure. Our reportable segments represent strategic business units comprised of investments in different types of infrastructure assets. We have five reportable segments which operate in infrastructure businesses across several market sectors, all in North America. 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 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 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 terminal located along the Ohio River with rail, dock, and multiple industrial development opportunities, including a 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 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. Our company’s CODM is our Chief Executive Officer, who uses Adjusted EBITDA as it serves as a consistent measure for comparing profitability between periods and across segments, independent of each segment’s capital structure, which may vary materially, and because it neutralizes one-time or other non-operational items. Decisions regarding resource allocation are made based on Adjusted EBITDA performance, together with other relevant factors, including but not limited to, market dynamics, growth opportunities and expected future performance. Adjusted EBITDA is defined as net income (loss) attributable to stockholders and 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 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 and Former Parent, 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 and Former Parent as determined in accordance with U.S. GAAP. The following tables set forth certain information for each reportable segment as provided to and evaluated by the CODM: I. For the Year Ended December 31, 2024 Year Ended December 31, 2024 Ports and Terminals Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total Revenues Total revenues $ 180,027 $ 80,646 $ 15,824 $ — $ — $ 55,000 331,497 Expenses Operating expenses 97,207 71,203 23,483 2,190 7 53,584 247,674 General and administrative — — — — — 14,798 14,798 Acquisition and transaction expenses 526 23 — 2,293 17 2,598 5,457 Management fees and incentive allocation to affiliate — — — — — 11,318 11,318 Depreciation and amortization 20,200 47,872 9,914 — — 1,424 79,410 Asset impairment — — — — 72,336 — 72,336 Total expenses 117,933 119,098 33,397 4,483 72,360 83,722 430,993 Other (expense) income Equity in (losses) earnings of unconsolidated entities — — — ( 37,146 ) ( 18,390 ) 40 ( 55,496 ) (Loss) gain on sale of assets, net ( 704 ) 3,074 — — — — 2,370 Loss on modification or extinguishment of debt — ( 8,925 ) — — — — ( 8,925 ) Interest expense ( 306 ) ( 49,001 ) ( 1,617 ) — — ( 71,184 ) ( 122,108 ) Other income 770 5,515 — 12,430 2,167 22 20,904 Total other expense ( 240 ) ( 49,337 ) ( 1,617 ) ( 24,716 ) ( 16,223 ) ( 71,122 ) ( 163,255 ) Income (loss) before income taxes 61,854 ( 87,789 ) ( 19,190 ) ( 29,199 ) ( 88,583 ) ( 99,844 ) ( 262,751 ) Provision for (benefit from) income taxes 4,692 ( 1,667 ) ( 431 ) — — 719 3,313 Net income (loss) 57,162 ( 86,122 ) ( 18,759 ) ( 29,199 ) ( 88,583 ) ( 100,563 ) ( 266,064 ) Less: Net income (loss) attributable to non-controlling interests in consolidated subsidiaries 245 ( 41,491 ) ( 1,173 ) — — — ( 42,419 ) Less: Dividends and accretion of redeemable preferred stock — — — — — 70,814 70,814 Net income (loss) attributable to stockholders $ 56,917 $ ( 44,631 ) $ ( 17,586 ) $ ( 29,199 ) $ ( 88,583 ) $ ( 171,377 ) $ ( 294,459 ) The following table sets forth a reconciliation of Adjusted EBITDA to net loss attributable to stockholders: Year Ended December 31, 2024 Ports and Terminals Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total Adjusted EBITDA $ 84,254 $ 41,967 $ ( 5,186 ) $ 40,246 $ ( 9,485 ) $ ( 24,208 ) $ 127,588 Add: Non-controlling share of Adjusted EBITDA 122 26,264 808 — — — 27,194 Add: Equity in (losses) earnings of unconsolidated entities — — — ( 37,146 ) ( 18,390 ) 40 ( 55,496 ) Less: Interest and other costs on pension and OPEB liabilities 66 — — — — — 66 Less: Dividends and accretion of redeemable preferred stock — — — — — ( 70,814 ) ( 70,814 ) Less: Pro-rata share of Adjusted EBITDA from unconsolidated entities — — — ( 30,006 ) 9,710 24 ( 20,272 ) Less: Interest expense ( 306 ) ( 49,001 ) ( 1,617 ) — — ( 71,184 ) ( 122,108 ) Less: Depreciation and amortization expense ( 20,200 ) ( 52,347 ) ( 9,914 ) — — ( 1,424 ) ( 83,885 ) Less: Incentive allocations — — — — — — — Less: Asset impairment charges — — — — ( 70,401 ) — ( 70,401 ) Less: Changes in fair value of non-hedge derivative instruments — — — — — — — Less: Losses on the modification or extinguishment of debt and capital lease obligations — ( 8,925 ) — — — — ( 8,925 ) Less: Acquisition and transaction expenses ( 526 ) ( 23 ) — ( 2,293 ) ( 17 ) ( 2,598 ) ( 5,457 ) Less: Equity-based compensation expense ( 1,801 ) ( 4,233 ) ( 2,108 ) — — ( 494 ) ( 8,636 ) Less: (Provision for) benefit from income taxes ( 4,692 ) 1,667 431 — — ( 719 ) ( 3,313 ) Less: Other non-recurring items — — — — — — — Net income (loss) attributable to stockholders $ 56,917 $ ( 44,631 ) $ ( 17,586 ) $ ( 29,199 ) $ ( 88,583 ) $ ( 171,377 ) $ ( 294,459 ) II. For the Year Ended December 31, 2023 Year Ended December 31, 2023 Ports and Terminals Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total Revenues Total revenues $ 169,445 $ 72,146 $ 10,691 $ — $ — $ 68,190 320,472 Expenses Operating expenses 92,972 66,576 22,203 2,726 29 69,166 253,672 General and administrative — — — — — 12,833 12,833 Acquisition and transaction expenses 737 1,370 — 94 1 1,938 4,140 Management fees and incentive allocation to affiliate — — — — — 12,467 12,467 Depreciation and amortization 19,590 48,916 9,336 — — 3,150 80,992 Asset impairment 743 — — — — — 743 Total expenses 114,042 116,862 31,539 2,820 30 99,554 $ 364,847 Other (expense) income Equity in (losses) earnings of unconsolidated entities — — — ( 9,949 ) ( 14,814 ) 56 ( 24,707 ) (Loss) gain on sale of assets, net ( 437 ) 7,292 — — — — 6,855 Loss on modification or extinguishment of debt ( 937 ) — — — — ( 1,099 ) ( 2,036 ) Interest expense ( 2,284 ) ( 32,443 ) ( 2,557 ) ( 3 ) — ( 62,316 ) ( 99,603 ) Other (expense) income ( 2,164 ) ( 1,302 ) — 7,523 2,529 — 6,586 Total other expense ( 5,822 ) ( 26,453 ) ( 2,557 ) ( 2,429 ) ( 12,285 ) ( 63,359 ) ( 112,905 ) Income (loss) before income taxes 49,581 ( 71,169 ) ( 23,405 ) ( 5,249 ) ( 12,315 ) ( 94,723 ) ( 157,280 ) (Benefit from) provision for income taxes ( 561 ) 2,468 496 — — 67 2,470 Net income (loss) 50,142 ( 73,637 ) ( 23,901 ) ( 5,249 ) ( 12,315 ) ( 94,790 ) ( 159,750 ) Less: Net income (loss) attributable to non-controlling interests in consolidated subsidiaries 143 ( 36,917 ) ( 1,412 ) — — ( 228 ) ( 38,414 ) Less: Dividends and accretion of redeemable preferred stock — — — — — 62,400 62,400 Net income (loss) attributable to stockholders $ 49,999 $ ( 36,720 ) $ ( 22,489 ) $ ( 5,249 ) $ ( 12,315 ) $ ( 156,962 ) $ ( 183,736 ) The following table sets forth a reconciliation of Adjusted EBITDA to net loss attributable to stockholders: Year Ended December 31, 2023 Ports and Terminals Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total Adjusted EBITDA $ 78,521 $ 35,694 $ ( 8,061 ) $ 34,784 $ ( 7,253 ) $ ( 26,163 ) $ 107,522 Add: Non-controlling share of Adjusted EBITDA 71 20,328 856 — — 260 21,515 Add: Equity in (losses) earnings of unconsolidated entities — — — ( 9,949 ) ( 14,814 ) 56 ( 24,707 ) Less: Interest and other costs on pension and OPEB liabilities ( 2,130 ) — — — — — ( 2,130 ) Less: Dividends and accretion of redeemable preferred stock — — — — — ( 62,400 ) ( 62,400 ) Less: Pro-rata share of Adjusted EBITDA from unconsolidated entities — — — ( 29,987 ) 9,753 25 ( 20,209 ) Less: Interest expense ( 2,284 ) ( 32,443 ) ( 2,557 ) ( 3 ) — ( 62,316 ) ( 99,603 ) Less: Depreciation and amortization expense ( 19,590 ) ( 49,465 ) ( 9,336 ) — — ( 3,150 ) ( 81,541 ) Less: Incentive allocations — — — — — — — Less: Asset impairment charges ( 743 ) — — — — — ( 743 ) Less: Changes in fair value of non-hedge derivative instruments — — ( 1,125 ) — — — ( 1,125 ) Less: Losses on the modification or extinguishment of debt and capital lease obligations ( 937 ) — — — — ( 1,099 ) ( 2,036 ) Less: Acquisition and transaction expenses ( 737 ) ( 1,370 ) — ( 94 ) ( 1 ) ( 1,938 ) ( 4,140 ) Less: Equity-based compensation expense ( 1,394 ) ( 5,865 ) ( 1,770 ) — — ( 170 ) ( 9,199 ) Less: Benefit from (provision for) income taxes 561 ( 2,468 ) ( 496 ) — — ( 67 ) ( 2,470 ) Less: Other non-recurring items ( 1,339 ) ( 1,131 ) — — — — ( 2,470 ) Net income (loss) attributable to stockholders $ 49,999 $ ( 36,720 ) $ ( 22,489 ) $ ( 5,249 ) $ ( 12,315 ) $ ( 156,962 ) $ ( 183,736 ) III. For the Year Ended December 31, 2022 Year Ended December 31, 2022 Ports and Terminals Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total Revenues Total revenues $ 149,661 $ 60,289 $ 4,117 $ — $ — $ 47,899 261,966 Expenses Operating expenses 84,863 56,417 17,072 826 10 48,969 208,157 General and administrative — — — — — 10,891 10,891 Acquisition and transaction expenses 763 64 — 458 280 15,279 16,844 Management fees and incentive allocation to affiliate — — — — — 12,964 12,964 Depreciation and amortization 20,164 39,318 9,322 — — 1,945 70,749 Total expenses 105,790 95,799 26,394 1,284 290 90,048 319,605 Other (expense) income Equity in (losses) earnings of unconsolidated entities — — — ( 60,538 ) ( 7,012 ) 151 ( 67,399 ) Loss on sale of assets, net ( 1,603 ) — — — — — ( 1,603 ) Interest expense ( 212 ) ( 24,798 ) ( 1,590 ) — — ( 26,639 ) ( 53,239 ) Other (expense) income ( 1,632 ) ( 4,317 ) — 524 2,123 133 ( 3,169 ) Total other expense ( 3,447 ) ( 29,115 ) ( 1,590 ) ( 60,014 ) ( 4,889 ) ( 26,355 ) ( 125,410 ) Income (loss) before income taxes 40,424 ( 64,625 ) ( 23,867 ) ( 61,298 ) ( 5,179 ) ( 68,504 ) ( 183,049 ) Provision for income taxes 1,287 3,016 165 — — — 4,468 Net income (loss) 39,137 ( 67,641 ) ( 24,032 ) ( 61,298 ) ( 5,179 ) ( 68,504 ) ( 187,517 ) Less: Net income (loss) attributable to non-controlling interests in consolidated subsidiaries 15 ( 32,018 ) ( 1,242 ) — — ( 688 ) ( 33,933 ) Less: Dividends and accretion of redeemable preferred stock — — — — — 23,657 23,657 Net income (loss) attributable to stockholders/Former Parent $ 39,122 $ ( 35,623 ) $ ( 22,790 ) $ ( 61,298 ) $ ( 5,179 ) $ ( 91,473 ) $ ( 177,241 ) The following table sets forth a reconciliation of Adjusted EBITDA to net loss attributable to stockholders and Former Parent: Year Ended December 31, 2022 Ports and Terminals Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total Adjusted EBITDA $ 64,286 $ 18,490 $ ( 12,743 ) $ 18,039 $ ( 2,334 ) $ ( 24,710 ) $ 61,028 Add: Non-controlling share of Adjusted EBITDA 25 15,103 500 — — 651 16,279 Add: Equity in (losses) earnings of unconsolidated entities — — — ( 60,538 ) ( 7,012 ) 151 ( 67,399 ) Less: Interest and other costs on pension and OPEB liabilities ( 1,232 ) — — — — — ( 1,232 ) Less: Dividends and accretion of redeemable preferred stock — — — — — ( 23,657 ) ( 23,657 ) Less: Pro-rata share of Adjusted EBITDA from unconsolidated entities — — — ( 18,341 ) 4,447 ( 45 ) ( 13,939 ) Less: Interest expense ( 212 ) ( 24,798 ) ( 1,590 ) — — ( 26,639 ) ( 53,239 ) Less: Depreciation and amortization expense ( 20,164 ) ( 39,318 ) ( 9,322 ) — — ( 1,945 ) ( 70,749 ) Less: Incentive allocations — — — — — — — Less: Asset impairment charges — — — — — — — Less: Changes in fair value of non-hedge derivative instruments — — 1,125 — — — 1,125 Less: Losses on the modification or extinguishment of debt and capital lease obligations — — — — — — — Less: Acquisition and transaction expenses ( 763 ) ( 64 ) — ( 458 ) ( 280 ) ( 15,279 ) ( 16,844 ) Less: Equity-based compensation expense ( 1,531 ) ( 2,020 ) ( 595 ) — — — ( 4,146 ) Less: Provision for income taxes ( 1,287 ) ( 3,016 ) ( 165 ) — — — ( 4,468 ) Less: Other non-recurring items — — — — — — — Net income (loss) attributable to stockholders/Former Parent $ 39,122 $ ( 35,623 ) $ ( 22,790 ) $ ( 61,298 ) $ ( 5,179 ) $ ( 91,473 ) $ ( 177,241 ) IV. Balance Sheet The following tables sets forth the summarized balance sheet. All property, plant and equipment and leasing equipment are located in North America. December 31, 2024 Ports and Terminals Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total Current assets $ 48,667 $ 154,752 $ 6,756 $ 6 $ 48 $ 9,622 $ 219,851 Non-current assets 662,241 1,118,886 334,882 116 24,307 14,105 2,154,537 Total assets 710,908 1,273,638 341,638 122 24,355 23,727 2,374,388 Total debt, net — 974,351 44,250 — — 569,234 1,587,835 Current liabilities 48,866 131,503 41,136 3,732 20 25,537 250,794 Non-current liabilities 34,348 996,984 47,374 18,240 — 570,292 1,667,238 Total liabilities 83,214 1,128,487 88,510 21,972 20 595,829 1,918,032 Redeemable preferred stock — — — — — 381,218 381,218 Non-controlling interests in equity of consolidated subsidiaries 4,722 ( 130,989 ) ( 1,246 ) — — — ( 127,513 ) Total equity 627,694 145,151 253,128 ( 21,850 ) 24,335 ( 953,320 ) 75,138 Total liabilities, redeemable preferred stock and equity $ 710,908 $ 1,273,638 $ 341,638 $ 122 $ 24,355 $ 23,727 $ 2,374,388 December 31, 2023 Ports and Terminals Railroad Jefferson Terminal Repauno Power and Gas Sustainability and Energy Transition Corporate and Other Total Current assets $ 58,114 $ 88,542 $ 9,267 $ 2 $ 22,405 $ 7,173 $ 185,503 Non-current assets 667,501 1,137,510 295,685 6,825 77,540 9,045 2,194,106 Total assets 725,615 1,226,052 304,952 6,827 99,945 16,218 2,379,609 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 Non-current liabilities 55,975 797,854 47,816 29,310 — 559,926 1,490,881 Total liabilities 110,125 862,906 52,728 30,138 — 585,621 1,641,518 Redeemable preferred stock — — — — — 325,232 325,232 Non-controlling interests in equity of consolidated subsidiaries 2,861 ( 74,278 ) ( 13 ) — — — ( 71,430 ) Total equity 615,490 363,146 252,224 ( 23,311 ) 99,945 ( 894,635 ) 412,859 Total liabilities, redeemable preferred stock and equity $ 725,615 $ 1,226,052 $ 304,952 $ 6,827 $ 99,945 $ 16,218 $ 2,379,609 94 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 16. REDEEMABLE PREFERRED STOCK On August 1, 2022, the Company issued and sold 300,000 shares of Redeemable Preferred Stock at a price of $ 1,000 per share and $ 0.01 par value. The shares were issued at a 3 % discount for net proceeds of $ 291.0 million. The Company also issued two classes of warrants to the preferred stockholders (see Note 17). The fair value of the Redeemable Preferred Stock and the warrants at issuance were determined to be $ 242.7 million and $ 13.8 million, respectively. The Company incurred $ 16.4 million of issuance costs related to the Redeemable Preferred Stock and warrants. Additionally, the Company issued options to the Manager with a total fair value of $ 18.1 million (see Note 14). The Redeemable Preferred Stock has the following rights, preferences and restrictions: Voting Each holder of the Redeemable Preferred Stock will have one vote per share on any matter on which holders of the Redeemable Preferred Stock are entitled to vote separately as a class, whether at a meeting or by written consent. The holders of shares of the Redeemable Preferred Stock do not otherwise have any voting rights. Liquidation Preference The Redeemable Preferred Stock ranks senior to the common stock with respect to dividend rights and rights upon the voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company. Upon a liquidation, dissolution or winding up of the affairs of the Company, each share of Redeemable Preferred Stock will be entitled to receive an amount per share equal to the greater of (i) the purchase price paid by the purchaser, plus all accrued and unpaid dividends (the “Liquidation Preference”) and (ii) the purchase price, plus $ 150.0 million of cash Dividends (the ”Base Preferred Return Amount”). Dividends Dividends on the Redeemable Preferred Stock are payable at a rate equal to 14.0 % per annum subject to increase in accordance with the terms of the Redeemable Preferred Stock. Specifically, the rate will be increased by 2.0 % per annum for any periods during the first two years following closing of the issuance of the Redeemable Preferred Stock, where the dividend is not paid in cash. Prior to the second anniversary of the issuance date, such dividends will automatically accrue and accumulate on each share of Redeemable Preferred Stock, whether or not declared and paid, or they may be paid in cash at our discretion. After the second anniversary of the issuance date, we are required to pay such dividends in cash. 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 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 December 31, 2024, the Company has $ 122.5 million of PIK dividends, increasing our Redeemable Preferred Stock balance. The Company had dividends paid in cash of $ 14.7 million and $ 1.8 million as of December 31, 2024 and 2023, respectively. Dividends recorded in Dividends and accretion of redeemable preferred stock on the Consolidated and Combined Consolidated Statements of Operations totaled $ 64.0 million and $ 55.8 million for the years ended December 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 of redeemable preferred stock on the Consolidated and Combined Consolidated Statements of Operations, totaled $ 6.8 million and $ 6.6 million for the years ended December 31, 2024 and 2023, respectively. Redemption Mandatory Redemption : The Redeemable Preferred Stock is not mandatorily redeemable at the option of the holders, except upon the occurrence of any (i) bankruptcy event, (ii) any change of control event, or (iii) any debt acceleration event (together with any bankruptcy event and change of control event) (each a “Mandatory Redemption Event”). Upon the occurrence of a Mandatory Redemption Event, to the extent not prohibited by law, we will be required to redeem all preferred stock in cash at the greater of the (i) Liquidation Preference, and (ii) the Base Preferred Return Amount at the date of redemption. Optional Redemption : The Redeemable Preferred Stock is optionally redeemable at the option of the Company, at any time, at the greater of the (i) Liquidation Preference, and (ii) the Base Preferred Return Amount at the date of redemption. 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 December 31, 2024, it would be redeemable for $ 431.8 million. Amendment to Certificate of Designations of Our Series A Preferred Stock On July 5, 2023, a Certificate of Amendment (the “Amendment”) to the Certificate of Designations for its Series A Preferred Stock (the “Certificate of Designations”) became effective, amending certain provisions of the Certificate of Designations to increase the aggregate principal amount of outstanding indebtedness that the Company and its subsidiaries may incur in order to facilitate the issuance of the additional $ 100.0 million of Senior Notes due 2027 (the “Additional Notes”). The holders of our Series A 95 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) Preferred Stock received a customary fee for their consent and purchased $ 33.4 million aggregate principal amount of the Additional Notes. 17. 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. Diluted LPS is calculated by dividing net loss attributable to stockholders and Former Parent by the weighted average number of common stock outstanding, plus any potentially dilutive securities, if dilutive. Potentially dilutive securities are calculated using the treasury stock method. The calculation of basic and diluted LPS is presented below: Year Ended December 31, (in thousands, except per share data) 2024 2023 2022 Net loss $ ( 266,064 ) $ ( 159,750 ) $ ( 187,517 ) Less: Net loss attributable to non-controlling interests in consolidated subsidiaries ( 42,419 ) ( 38,414 ) ( 33,933 ) Less: Dividends and accretion of redeemable preferred stock 70,814 62,400 23,657 Net loss attributable to stockholders/Former Parent $ ( 294,459 ) $ ( 183,736 ) $ ( 177,241 ) Weighted Average Common Stock Outstanding - Basic (1) 108,217,871 102,960,812 102,747,121 Weighted Average Common Stock Outstanding - Diluted (1) 108,217,871 102,960,812 102,747,121 Loss per share: Basic $ ( 2.72 ) $ ( 1.78 ) $ ( 1.73 ) Diluted (2) $ ( 2.72 ) $ ( 1.79 ) $ ( 1.73 ) ______________________________________________________________________________________ (1) The year ended December 31, 2024 includes penny warrants that were converted into common stock during the year. (2) Diluted LPS includes the dilutive effect of subsidiary earnings per share. For the years ended December 31, 2024, 2023 and 2022, 2,681,996 , 2,917,041 and 586,269 shares of common stock, respectively, have been excluded from the calculation of Diluted LPS because the impact would be anti-dilutive. For the years ended December 31, 2024, 2023 and 2022, — , 3,332,478 and 3,330,659 of warrants, 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 of common stock 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 year ended December 31, 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. In addition, as of the Spin-off Date, each FTAI option held by the Manager or by the directors, officers, employees, service providers, consultants and advisors of the Manager was converted into an adjusted FTAI option and a new FTAI Infrastructure Inc. option. The exercise price of each adjusted FTAI Infrastructure Inc. option was set to collectively maintain the intrinsic value of the FTAI option immediately prior to the spin-off and to maintain the ratio of the exercise price of the adjusted FTAI option and the FTAI Infrastructure Inc. option, respectively, to the fair market value of the underlying shares. The terms and conditions applicable to each FTAI Infrastructure option are substantially similar to the terms and conditions otherwise applicable to the FTAI option. On August 1, 2022, we issued 10.9 million options to purchase common stock to the Manager, with a term of 10 years and strike price of $ 2.76 as compensation to the Manager for services rendered in connection with the Redeemable Preferred Stock raise, as discussed in Note 16. We issued 15,000 options to purchase common stock to certain directors as compensation during the year ended December 31, 2022 . Common Stock Warrants On August 1, 2022, in connection with the Redeemable Preferred Stock raise, the Company issued two classes of warrants to the redeemable preferred stockholders. The Series I Warrants represent the right to purchase 3,342,566 shares of common stock, at an exercise price of $ 10.00 per share, and the Series II Warrants represent the right to purchase 3,342,566 shares of common stock at an exercise price of $ 0.01 per share. Both classes of warrants expire on the earlier of August 1, 2030 or a change in control. The Series II Warrants participate on an as-converted basis in any dividends with respect to the common stock. 96 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) A summary of the status of the Company’s outstanding stock warrants and changes during the year ended December 31, 2024 is as follows: Number of Warrants Weighted Average Exercise Price Outstanding as of December 31, 2023 6,685,132 $ 4.93 Issued — — Expired — — Exercised 3,342,566 0.01 Outstanding as of December 31, 2024 (1) 3,342,566 $ 9.85 Warrants exercisable as of December 31, 2024 (1) 3,342,566 $ 9.85 ______________________________________________________________________________________ (1) Weighted average exercise price as of December 31, 2024 includes adjustments for quarterly dividend payments. On July 22, 2024, members of Ares Management LLC exercised their rights to the Series II Warrants in full to purchase 3,342,566 shares of common stock of the Company at the exercise price of $ 0.01 per share pursuant to the Warrant Agreement, dated August 1, 2022. The weighted average remaining contractual term of the outstanding warrants as of December 31, 2024 is 5.6 years. The aggregate intrinsic value of the warrants as of December 31, 2024 is $ — million. 18. COMMITMENTS AND CONTINGENCIES In the normal course of business we, and our subsidiaries, may be involved in various claims, legal proceedings, or may enter into contracts that contain a variety of representations and warranties and which provide general indemnifications. We have also entered into an arrangement with our non-controlling interest holder of Repauno, as part of the initial acquisition, whereby the non-controlling interest holder may receive additional payments contingent upon the achievement of certain conditions, not to exceed $ 15.0 million. We will account for such amounts when and if such conditions are achieved. The contingency related to $ 5.0 million of the total $ 15.0 million was resolved and paid 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 and paid during the year ended December 31, 2022. 19. SUBSEQUENT EVENTS EB-5 and EB-5.2 Loan Agreement Extensions On February 3, 2025, Jefferson Terminal exercised its option to extend the maturity of its EB-5 Loan Agreement and EB-5.2 Loan Agreement by one year to January 25, 2027 and March 10, 2027, respectively. Long Ridge Energy & Power LLC Senior Secured Notes due 2032 and Credit Agreement On February 19, 2025, Long Ridge Energy LLC, a subsidiary of Long Ridge Energy & Power LLC, closed its private offering of $ 600.0 million aggregate principal amount of 8.750 % senior secured notes due 2032 (the “Notes”). The Notes were issued at an issue price equal to 100.00 % of principal, plus accrued interest from and including February 19, 2025. The Notes will mature on February 15, 2032. On February 19, 2025, Long Ridge entered into a Credit Agreement to borrow senior secured term loans (the “New Term Loan”) for an aggregate principal amount of $ 400.0 million . The New Term Loans bear interest at SOFR plus 4.50 % per annum and mature on February 19, 2032. Refer to the Company’s Form 8-K which was filed with the Securities and Exchange Commission on February 25, 2025 for additional detail. Acquisition of Outstanding Equity Interests in Long Ridge Energy & Power LLC On February 26, 2025, the Company entered into a purchase agreement (the “Purchase Agreement”) with certain affiliates of GCM Grosvenor Inc. (“GCM”), owner of 49.9 % of the limited liability company interests of Long Ridge Energy & Power LLC, to acquire GCM’s 49.9 % interest (the “Long Ridge Acquisition”). Consideration to GCM for the acquisition included (i) Long Ridge Energy & Power LLC issuing a $ 20.0 million promissory note to an affiliate of GCM, (ii) cash consideration of $ 9.0 million paid by the Company and (iii) 160,000 shares of newly formed Series B Convertible Junior Preferred Stock (the “Series B Preferred Stock”) issued by the Company to certain affiliates of GCM. The Series B Preferred Stock ranks senior to the shares of the Company’s common stock, par value $ 0.01 per share, and junior to the Company’s Series A Preferred Stock, with respect to the payment of dividends and the distribution of assets upon a liquidation, dissolution or winding up of the Company. Each share of Series B Preferred Stock has an initial liquidation preference of $ 1,000 per share. Holders of the Series B Preferred Stock are entitled to a quarterly compounding, regular dividend (the “Dividend”) equal to 9.00 % per annum for any Dividend paid in cash with respect to the immediately preceding quarter, and 97 FTAI INFRASTRUCTURE INC. NOTES TO CONSOLIDATED AND COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in tables in thousands, unless otherwise noted) 10.00 % per annum for any Dividend paid-in-kind, at the Company’s election and pursuant to the Company’s amended Articles of Incorporation or Bylaws as discussed below. On February 26, 2025, as required under the Purchase Agreement, the Company entered into an Investor Rights Agreement with certain affiliates of GCM acquiring Series B Preferred Stock as part of the Long Ridge Acquisition. Refer to the Company’s Form 8-K which was filed with the Securities and Exchange Commission on February 27, 2025 for additional detail. Ares Management LLC Warrant Agreement On February 26, 2025, the Company and Ares Management LLC (“Ares”) amended and restated the warrant agreement, initially dated as of August 1, 2022. As part of the consent fee for the Series A Amendment, the Company issued 550,000 Series A Warrants to entities affiliated with Ares. The warrants have an exercise price of $ 10.00 per share. Refer to the Company’s Form 8-K which was filed with the Securities and Exchange Commission on February 27, 2025 for additional detail. Manager Options On February 26, 2025, in connection with the Series B Preferred stock, the Company paid and issued to its manager, an option to purchase 2,852,049 shares of common stock at a per share exercise price equal to $ 5.61 , the closing price of common stock on February 25, 2025. The option is fully vested as of the date of grant, is exercisable as to 1/30th of the shares of common stock to which the option is subject on the first day of each of the 30 calendar months following the first full calendar month after the date of grant and expires on the tenth anniversary of the date of grant. Refer to the Company’s Form 8-K which was filed with the Securities and Exchange Commission on February 27, 2025 for additional detail. Amendments to Articles of Incorporation or Bylaws On February 26, 2025, the Board approved a Certificate of Amendment (the “Amendment”) to the certificate of designations governing its Series A Preferred Stock (the “Series A Certificate of Designations”), which amends certain provisions of the Series A Certificate of Designations to permit the Long Ridge Acquisition and the issuance of the Series B Preferred Stock. The Amendment also permits the Company to make cash “catch-up” payments to holders of Series A Preferred Stock, with the equivalent amount of previously paid-in-kind dividends correspondingly treated as though initially paid as cash dividends for all purposes under the Series A Certificate of Designations, including with respect to months counted toward an Event of Noncompliance (as defined in the Series A Certificate of Designations). Furthermore, the Amendment permits the Company to make quarterly cash dividend payments of up to $ 0.03 on its Common Stock, so long as the holders of the Series A Preferred Stock have received cash dividends equal to at least the amount of dividends accrued since the two-year anniversary of the issue date of the Series A Preferred Stock. Refer to the Company’s Form 8-K which was filed with the Securities and Exchange Commission on February 27, 2025 for additional detail. Dividends On February 26, 2025, the Company paid Ares a dividend of $ 23.8 million related to its Series A Preferred Stock. On February 27, 2025, our board of directors declared a cash dividend on our common stock of $ 0.03 per share for the quarter ended December 31, 2024, payable on March 26, 2025 to the holders of record on March 14, 2025. Amendment to October 2024 Jefferson Credit Agreement On March 11, 2025, our Jefferson Terminal segment amended its October 2024 Credit Agreement for $ 50.0 million to include two options to extend the maturity date to (i) January 1, 2026 and subsequently to (ii) April 1, 2026. March 2025 Repauno Credit Agreement On March 11, 2025, our Repauno segment entered into a credit agreement, providing for a $ 30.0 million term loan facility, which matures on July 18, 2025 with the option to extend the maturity date to April 1, 2026, and bears interest at the sum of 4.00 % plus the secured overnight financing rate as administered by the Federal Reserve Bank of New York. 98 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.