Q1 2026 loss and Long Ridge sale plan at FTAI Infrastructure (NASDAQ: FIP)
Filing Impact
Filing Sentiment
Form Type
10-Q
Rhea-AI Filing Summary
FTAI Infrastructure Inc. reported Q1 2026 revenue of $188.4 million, almost double the prior-year period’s $96.2 million, driven by strong growth in Railroad and Power and Gas. Despite higher revenue, the company posted a net loss of $127.2 million versus net income of $120.2 million a year earlier, mainly due to higher interest expense, a $45.9 million loss on debt extinguishment, and $37.2 million of preferred dividends and accretion. Adjusted EBITDA fell to $70.6 million from $155.2 million. Diluted loss per share was $(1.32), compared with earnings of $0.89. Total assets were $5.7 billion, with total debt of $3.8 billion and negative total equity of $303.1 million as of March 31, 2026. The company refinanced its bridge facility with a new $1.35 billion term loan maturing in 2028 and secured a $255 million bridge backstop for 2024 bonds. After quarter-end, it agreed to sell Long Ridge Energy & Power LLC for a base purchase price of $1.52 billion, expected to reduce debt and improve liquidity.
Positive
- Signed $1.52 billion Long Ridge sale agreement after quarter-end, which, if completed as described, is expected to provide significant cash proceeds that can reduce debt and strengthen liquidity.
- Revenue growth and segment diversification with Q1 2026 revenue of $188.4 million up from $96.2 million, driven by strong contributions from Railroad, Jefferson Terminal and Power and Gas.
Negative
- Large net loss and negative equity as Q1 2026 net loss reached $127.2 million and total equity was negative $303.1 million, reflecting high financing costs, preferred accretion and accumulated deficits.
- High leverage and interest burden with total debt of $3.84 billion and quarterly interest expense of $82.5 million, plus a $45.9 million loss on debt extinguishment from refinancing activities.
Insights
Results show higher revenue but leveraged balance sheet and reliance on asset sale for de-risking.
FTAI Infrastructure nearly doubled Q1 revenue to $188.4M, yet swung to a net loss of $127.2M. Key drivers were higher interest expense of $82.5M and a $45.9M loss on debt extinguishment tied to refinancing.
Debt remains substantial at $3.84B against total assets of $5.69B, and equity is negative $303.1M. The new $1.35B Term Loan due 2028 and a $255M backstop facility extend maturities but lock in relatively high interest costs.
A signed agreement to sell Long Ridge Energy & Power for $1.52B after quarter-end is central to the deleveraging plan. Actual impact will depend on closing, final adjustments and how much of the proceeds are directed to debt reduction versus other uses disclosed in future filings.
Key Figures
Q1 2026 revenue: $188.4M
Q1 2026 net (loss) income: $(127.2M)
Diluted EPS: $(1.32) per share
+5 more
8 metrics
Q1 2026 revenue
$188.4M
Total revenues for the three months ended March 31, 2026
Q1 2026 net (loss) income
$(127.2M)
Net loss for the three months ended March 31, 2026
Diluted EPS
$(1.32) per share
Diluted loss per share for Q1 2026
Adjusted EBITDA
$70.6M
Adjusted EBITDA for the three months ended March 31, 2026
Total assets
$5.69B
Total assets as of March 31, 2026
Total debt
$3.84B
Total debt outstanding as of March 31, 2026
Long Ridge sale price
$1.52B
Base purchase price for Long Ridge Energy & Power LLC in April 29, 2026 agreement
Term Loan facility size
$1.35B
Secured term loan facility under Term Loan Credit Agreement, maturing February 1, 2028
Key Terms
Adjusted EBITDA, redeemable preferred stock, Series B Preferred Stock, Backstop Agreement, +1 more
5 terms
Adjusted EBITDA financial
"Adjusted EBITDA is defined as net income (loss) attributable to stockholders... adjusted (a) to exclude the impact of provision for (benefit from) income taxes..."
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
redeemable preferred stock financial
"Redeemable preferred stock Series A RailCo - Non-controlling interest... redemption amount of $1.4 billion..."
Series B Preferred Stock financial
"In connection with our February 2025 offering of Series B Preferred Stock ("Convertible Preferred Stock")..."
Series B preferred stock is a type of ownership share issued by a company that offers certain advantages over common stock, such as priority in receiving dividends or assets if the company is sold or liquidated. It is typically issued after an initial round of funding, making it a way for investors to support a company's growth while gaining some protections and benefits. This stock matters to investors because it often provides a more secure investment position with potential for future growth.
Backstop Agreement financial
"entered into a binding Commitment Agreement (the “Backstop Agreement”) dated March 16, 2026..."
A backstop agreement is a guarantee from a third party to buy any unsold shares or take up remaining financing in a company’s stock sale or fundraising round, acting like a safety net so the deal goes through. For investors, it lowers the chance that a planned capital raise will fail and clarifies how much new stock might be issued and who will hold it, which can affect share value and dilution.
cash flow hedges financial
"The electricity swap derivatives are designated as hedging instruments within cash flow hedging relationships."
A cash flow hedge is an accounting label companies use when they enter financial contracts—like currency or interest-rate agreements—to protect expected future cash payments or receipts from unpredictable moves. For investors, it signals that the company is trying to smooth out future cash variability (think of locking in a price to avoid surprises), which can reduce reported profit swings but also means the company has exposure to derivative instruments and their associated risks.
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended March 31, 2026
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from ____ to ____
Commission file number 001-41370
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||||||||||||||
(Registrant’s telephone number, including area code) (212 ) 798-6100
(Former name, former address and former fiscal year, if changed since last report) N/A
| Securities registered pursuant to Section 12(b) of the Act: | ||||||||||||||
| Title of each class: | Trading Symbol: | Name of exchange on which registered: | ||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| þ | Accelerated filer | ☐ | |||||||||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | |||||||||||||||
| Emerging growth company | |||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ
As of May 6, 2026, the number of outstanding shares of the registrant’s common stock was 118,163,555 shares.
FORWARD-LOOKING STATEMENTS AND RISK FACTORS SUMMARY
This report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact but instead are based on our present beliefs and assumptions and on information currently available to us. You can identify these forward-looking statements by the use of forward-looking words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” “target,” “projects,” “contemplates” or the negative version of those words or other comparable words. Any forward-looking statements contained in this report are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, that the future plans, estimates or expectations contemplated by us will be achieved.
Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. The following is a summary of the principal risk factors that make investing in our securities risky and may materially adversely affect our business, financial condition, results of operations and cash flows. This summary should be read in conjunction with the more complete discussion of the risk factors we face, which are set forth in Part II, Item 1A, “Risk Factors” of this report. We believe that these factors include, but are not limited to:
•our ability to successfully operate as a standalone public company;
•changes in economic conditions generally and specifically in our industry sectors, and other risks relating to the global economy, including, but not limited to, U.S. federal government shutdowns, the Russia-Ukraine conflict, the conflicts in the Middle East, public health crises, changing trade policies and tariffs, including related uncertainty or the imposition of modified or additional tariffs, and any related responses or actions by businesses and governments;
•reductions in cash flows received from our assets;
•our ability to take advantage of acquisition opportunities at favorable prices;
•a lack of liquidity surrounding our assets, which could impede our ability to vary our portfolio in an appropriate manner;
•the relative spreads between the yield on the assets we acquire and the cost of financing;
•adverse changes in the financing markets we access affecting our ability to finance our acquisitions;
•customer defaults on their obligations;
•our ability to renew existing contracts and enter into new contracts with existing or potential customers;
•the availability and cost of capital, including for future acquisitions, to refinance our debt and to fund our operations;
•concentration of a particular type of asset or in a particular sector;
•competition within the rail, energy and intermodal transport sectors;
•the competitive market for acquisition opportunities;
•risks related to operating through joint ventures, partnerships, consortium arrangements or other collaborations with third parties;
•our ability to successfully integrate acquired businesses, including The Wheeling Corporation (“Wheeling”) with Transtar;
•obsolescence of our assets or our ability to sell our assets;
•exposure to uninsurable losses and force majeure events;
•infrastructure operations and maintenance may require substantial capital expenditures;
•the legislative/regulatory environment and exposure to increased economic regulation;
•exposure to the oil and gas industry’s volatile oil and gas prices;
•our ability to maintain our exemption from registration under the Investment Company Act of 1940 and the fact that maintaining such exemption imposes limits on our operations;
•our ability to successfully utilize leverage in connection with our investments;
•foreign currency risk and risk management activities;
•effectiveness of our internal control over financial reporting;
•exposure to environmental risks, including natural disasters, increasing environmental legislation and the broader impacts of climate change;
•changes in interest rates and/or credit spreads, as well as the success of any hedging strategy we may undertake in relation to such changes;
•actions taken by national, state, or provincial governments, including nationalization, or the imposition of new taxes, could materially impact the financial performance or value of our assets;
•our dependence on FIG LLC (the “Manager”) and its professionals and actual, potential or perceived conflicts of interest in our relationship with our Manager;
2
•effects of the acquisition of Softbank Group Corp.’s (“Softbank”) equity in Fortress Investment Group LLC (“Fortress”) by certain members of management of Fortress and Mubadala Capital, a wholly owned asset management subsidiary of Mubadala Investment Company (“Mubadala”);
•volatility in the market price of our stock;
•the inability to pay dividends to our stockholders in the future; and
•other risks described in the “Risk Factors” section of this report.
These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this report. The forward-looking statements made in this report relate only to events as of the date on which the statements are made. We do not undertake any obligation to publicly update or review any forward-looking statement except as required by law, whether as a result of new information, future developments or otherwise.
If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from what we may have expressed or implied by these forward-looking statements. We caution that you should not place undue reliance on any of our forward-looking statements. Furthermore, new risks and uncertainties arise from time to time, and it is impossible for us to predict those events or how they may affect us.
3
FTAI INFRASTRUCTURE INC.
INDEX TO FORM 10-Q
| PART I - FINANCIAL INFORMATION | ||||||||
| Item 1. | Unaudited Consolidated Financial Statements of FTAI Infrastructure Inc.: | 5 | ||||||
Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025 | 5 | |||||||
Consolidated Statements of Operations for the three months ended March 31, 2026 and 2025 | 7 | |||||||
Consolidated Statements of Comprehensive (Loss) Income for the three months ended March 31, 2026 and 2025 | 8 | |||||||
Consolidated Statements of Changes in Equity for the three months ended March 31, 2026 and 2025 | 9 | |||||||
Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025 | 10 | |||||||
Notes to Consolidated Financial Statements | 11 | |||||||
Note 1: Summary of Significant Accounting Policies | 11 | |||||||
Note 2: Acquisition of Subsidiaries | 12 | |||||||
Note 3: Leasing Equipment, net | 14 | |||||||
Note 4: Property, Plant and Equipment, net | 15 | |||||||
Note 5: Investments | 15 | |||||||
Note 6: Intangible Assets, net | 16 | |||||||
Note 7: Debt, net | 17 | |||||||
Note 8: Fair Value Measurements | 18 | |||||||
Note 9: Derivative Financial Instruments | 20 | |||||||
Note 10: Revenues | 21 | |||||||
Note 11: Equity-Based Compensation | 22 | |||||||
Note 12: Income Taxes | 23 | |||||||
Note 13: Management Agreement and Affiliate Transactions | 23 | |||||||
Note 14: Segment Information | 25 | |||||||
Note 15: Redeemable Preferred Stock | 31 | |||||||
Note 16: Earnings per Share and Equity | 31 | |||||||
Note 17: Commitments and Contingencies | 32 | |||||||
Note 18: Subsequent Events | 32 | |||||||
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 33 | ||||||
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 50 | ||||||
| Item 4. | Controls and Procedures | 51 | ||||||
| PART II - OTHER INFORMATION | ||||||||
| Item 1. | Legal Proceedings | 52 | ||||||
| Item 1A. | Risk Factors | 52 | ||||||
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 71 | ||||||
| Item 3. | Defaults Upon Senior Securities | 71 | ||||||
| Item 4. | Mine Safety Disclosures | 71 | ||||||
| Item 5. | Other Information | 71 | ||||||
| Item 6. | Exhibits | 72 | ||||||
4
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
FTAI INFRASTRUCTURE INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share and per share data)
| (Unaudited) | |||||||||||||||||
| Notes | March 31, 2026 | December 31, 2025 | |||||||||||||||
| Assets | |||||||||||||||||
| Current assets: | |||||||||||||||||
| Cash and cash equivalents | $ | $ | |||||||||||||||
| Restricted cash and cash equivalents | |||||||||||||||||
| Accounts receivable, net | |||||||||||||||||
| Other current assets | 1 | ||||||||||||||||
| Total current assets | |||||||||||||||||
| Leasing equipment, net | 3 | ||||||||||||||||
| Operating lease right-of-use assets, net | |||||||||||||||||
| Property, plant, and equipment, net | 4 | ||||||||||||||||
| Investments | 5 | ||||||||||||||||
| Intangible assets, net | 6 | ||||||||||||||||
| Goodwill | |||||||||||||||||
| Other assets | |||||||||||||||||
| Total assets | $ | $ | |||||||||||||||
| Liabilities | |||||||||||||||||
| Current liabilities: | |||||||||||||||||
| Accounts payable and accrued liabilities | $ | $ | |||||||||||||||
| Debt, net | 7 | ||||||||||||||||
| Operating lease liabilities | |||||||||||||||||
| Derivative liabilities | 9 | ||||||||||||||||
| Other current liabilities | 1 | ||||||||||||||||
| Total current liabilities | |||||||||||||||||
| Debt, net | 7 | ||||||||||||||||
| Operating lease liabilities | |||||||||||||||||
| Derivative liabilities | 9 | ||||||||||||||||
| Warrant liabilities | 17 | ||||||||||||||||
| Deferred income tax liabilities | 12 | ||||||||||||||||
| Other liabilities | |||||||||||||||||
| Total liabilities | |||||||||||||||||
| Commitments and contingencies | 17 | ||||||||||||||||
Redeemable convertible preferred stock Series B ($ | 15 | ||||||||||||||||
Redeemable preferred stock Series A RailCo - Non-controlling interest ( | 17 | ||||||||||||||||
| Equity | |||||||||||||||||
Common stock ($ | |||||||||||||||||
| Additional paid in capital | |||||||||||||||||
5
FTAI INFRASTRUCTURE
COMBINED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
| Accumulated deficit | ( | ( | |||||||||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||||||||
| Stockholders' equity | ( | ||||||||||||||||
| Non-controlling interest in equity of consolidated subsidiaries | ( | ( | |||||||||||||||
| Total equity | ( | ( | |||||||||||||||
| Total liabilities, redeemable preferred stock and equity | $ | $ | |||||||||||||||
See accompanying notes to consolidated financial statements.
6
FTAI INFRASTRUCTURE INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
(Dollars in thousands, except share and per share data)
| Three Months Ended March 31, | |||||||||||||||||
| Notes | 2026 | 2025 | |||||||||||||||
| Revenues | |||||||||||||||||
| Total revenues | 10 | $ | $ | ||||||||||||||
| Expenses | |||||||||||||||||
| Operating expenses | |||||||||||||||||
| General and administrative | |||||||||||||||||
| Acquisition and transaction expenses | |||||||||||||||||
| Management fees and incentive allocation to affiliate | 13 | ||||||||||||||||
| Depreciation and amortization | 3, 6 | ||||||||||||||||
| Total expenses | |||||||||||||||||
| Other income (expense) | |||||||||||||||||
| Equity in (losses) earnings of unconsolidated entities | 5 | ( | |||||||||||||||
| (Loss) gain on sale of assets, net | ( | ||||||||||||||||
| Loss on modification or extinguishment of debt | 7 | ( | ( | ||||||||||||||
| Interest expense | ( | ( | |||||||||||||||
| Other income | |||||||||||||||||
| Total other (expense) income | ( | ||||||||||||||||
| (Loss) income before income taxes | ( | ||||||||||||||||
| Provision for (benefit from) income taxes | 12 | ( | |||||||||||||||
| Net (loss) income | ( | ||||||||||||||||
| Less: Net loss attributable to non-controlling interests in consolidated subsidiaries - common stockholders | ( | ( | |||||||||||||||
| Less: Preferred dividends and accretion on redeemable non-controlling interests | |||||||||||||||||
| Less: Dividends and accretion of redeemable preferred stock | |||||||||||||||||
| Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | ( | $ | ||||||||||||||
| Net (loss) income attributable to common stockholders | 16 | $ | ( | $ | |||||||||||||
| (Loss) earnings per share: | 16 | ||||||||||||||||
| Basic | $ | ( | $ | ||||||||||||||
| Diluted | $ | ( | $ | ||||||||||||||
| Weighted average shares outstanding: | |||||||||||||||||
| Basic | |||||||||||||||||
| Diluted | |||||||||||||||||
See accompanying notes to consolidated financial statements.
7
FTAI INFRASTRUCTURE INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (unaudited)
(Dollars in thousands)
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Net (loss) income | $ | ( | $ | ||||||||
| Other comprehensive income (loss): | |||||||||||
Other comprehensive income related to derivatives (1) | |||||||||||
Change in pension and other employee benefit accounts | ( | ( | |||||||||
| Comprehensive (loss) income | ( | ||||||||||
| Comprehensive loss attributable to non-controlling interests | ( | ( | |||||||||
| Comprehensive (loss) income attributable to stockholders | $ | ( | $ | ||||||||
______________________________________________________________________________________
(1) Net of deferred tax benefit of $— million and $9.2 million for the three months ended March 31, 2026 and 2025, respectively.
See accompanying notes to consolidated financial statements.
8
FTAI INFRASTRUCTURE INC.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (unaudited)
(Dollars in thousands)
Three Months Ended March 31, 2026 | |||||||||||||||||||||||||||||||||||
| Common Stock | Additional Paid In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Non-Controlling Interest in Equity of Consolidated Subsidiaries | Total Equity | ||||||||||||||||||||||||||||||
| Equity - December 31, 2025 | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||
| Net loss | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Other comprehensive income | |||||||||||||||||||||||||||||||||||
| Total comprehensive (loss) income | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Settlement of equity-based compensation | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Issuance of common shares | ( | ||||||||||||||||||||||||||||||||||
| Distributions to non-controlling interest | ( | ( | |||||||||||||||||||||||||||||||||
| Dividends declared on common stock | ( | ( | |||||||||||||||||||||||||||||||||
| Dividends and accretion of redeemable preferred stock | ( | ( | |||||||||||||||||||||||||||||||||
| Equity-based compensation | |||||||||||||||||||||||||||||||||||
| Equity - March 31, 2026 | $ | $ | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||
| Three Months Ended March 31, 2025 | |||||||||||||||||||||||||||||||||||
| Common Stock | Additional Paid in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Non-Controlling Interest in Equity of Consolidated Subsidiaries | Total Equity | ||||||||||||||||||||||||||||||
| Equity - December 31, 2024 | $ | $ | $ | ( | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||
| Net loss | ( | ||||||||||||||||||||||||||||||||||
| Other comprehensive income | |||||||||||||||||||||||||||||||||||
| Total comprehensive income (loss) | ( | ||||||||||||||||||||||||||||||||||
| Settlement of equity-based compensation | ( | ( | |||||||||||||||||||||||||||||||||
| Issuance of common shares | |||||||||||||||||||||||||||||||||||
| Issuance of warrants | |||||||||||||||||||||||||||||||||||
| Issuance of Manager options | |||||||||||||||||||||||||||||||||||
| Dividends declared on common stock | ( | ( | |||||||||||||||||||||||||||||||||
| Dividends and accretion of redeemable preferred stock | ( | ( | |||||||||||||||||||||||||||||||||
| Equity-based compensation | |||||||||||||||||||||||||||||||||||
| Equity - March 31, 2025 | $ | $ | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||||||
See accompanying notes to consolidated financial statements.
9
FTAI INFRASTRUCTURE INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(Dollars in thousands)
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net (loss) income | $ | ( | $ | ||||||||
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||||
| Equity in losses (earnings) of unconsolidated entities | ( | ||||||||||
| Gain on sale of subsidiaries | ( | ||||||||||
| Loss on modification or extinguishment of debt | |||||||||||
| Equity-based compensation | |||||||||||
| Depreciation and amortization | |||||||||||
| Change in deferred income taxes | ( | ||||||||||
| Amortization of deferred financing costs | |||||||||||
| Amortization of bond discount | |||||||||||
| Amortization of other comprehensive income | ( | ( | |||||||||
| Other | |||||||||||
| Change in: | |||||||||||
| Accounts receivable | ( | ||||||||||
| Other assets | ( | ( | |||||||||
| Accounts payable and accrued liabilities | ( | ||||||||||
| Derivative liabilities | ( | ||||||||||
| Other liabilities | ( | ||||||||||
| Net cash used in operating activities | ( | ( | |||||||||
| Cash flows from investing activities: | |||||||||||
| Investment in unconsolidated entities | ( | ( | |||||||||
| Acquisition of business, net of cash acquired | |||||||||||
| Acquisition of property, plant and equipment | ( | ( | |||||||||
| Proceeds from investor loan | |||||||||||
| Proceeds from sale of property, plant and equipment | |||||||||||
| Net cash (used in) provided by investing activities | ( | ||||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from debt, net | |||||||||||
| Repayment of debt | ( | ||||||||||
| Payment of financing costs | ( | ( | |||||||||
| Proceeds from financing obligation | |||||||||||
| Repayment of financing obligation | ( | ||||||||||
| Cash dividends - common stock | ( | ( | |||||||||
| Cash dividends - redeemable preferred stock | ( | ||||||||||
| Cash dividends - redeemable preferred stock - NCI | ( | ||||||||||
| Settlement of equity-based compensation | ( | ( | |||||||||
| Distributions to non-controlling interests | ( | ||||||||||
| Net cash provided by (used in) financing activities | ( | ||||||||||
| Net (decrease) increase in cash and cash equivalents and restricted cash and cash equivalents | ( | ||||||||||
| Cash and cash equivalents and restricted cash and cash equivalents, beginning of period | |||||||||||
| Cash and cash equivalents and restricted cash and cash equivalents, end of period | $ | $ | |||||||||
| Supplemental disclosure of non-cash investing and financing activities: | |||||||||||
| Acquisition of property, plant and equipment | $ | $ | |||||||||
| Acquisition of business | ( | ||||||||||
| Dividends and accretion of redeemable preferred stock | |||||||||||
| Dividends and accretion of redeemable preferred stock - NCI | ( | ||||||||||
| Financing fees | |||||||||||
See accompanying notes to consolidated financial statements.
10
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting—The accompanying consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and include the accounts of FTAI Infrastructure Inc. (“we”, “us”, “our”, “FTAI Infrastructure” or the “Company”) and our subsidiaries. These financial statements and related notes should be read in conjunction with the Consolidated Financial Statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
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 financial statements and the reported amounts of revenues and expenses during the reporting period. 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—During the quarter, we have (i) refinanced the Bridge Loan Credit Agreement with the Term Loan Credit Agreement (see Note 7 for additional details), (ii) paid down the Jefferson June 2025 Credit Agreement and (iii) entered into a binding Commitment Agreement (the “Backstop Agreement”) dated March 16, 2026, pursuant to which we may, at our sole option, on or prior to July 1, 2026, elect to borrow from a lender funds in an aggregate principal amount of $255.0 million pursuant to a bridge facility that will have a maturity date which is 364 days after the close of such bridge facility (see Note 7 for additional details). However, the Company has significant remaining debt obligations, which it continues to actively manage. The planned sale of Long Ridge will further improve the Company’s liquidity position and reduce our total debt (see Note 18 for additional details). Management’s planned actions, including the sale of Long Ridge, are considered probable to be implemented and to provide sufficient liquidity for the Company to meet its obligations as they become due over the twelve months from the date the financial statements were issued.
Other Current Assets—Other current assets is comprised of:
March 31, 2026 | December 31, 2025 | ||||||||||
| Notes receivable | $ | $ | |||||||||
Prepaid expenses | |||||||||||
| Purchase deposits | |||||||||||
Other receivables | |||||||||||
| Inventory | |||||||||||
Other assets | |||||||||||
Total other current assets | $ | $ | |||||||||
Other Current Liabilities—Other current liabilities primarily include insurance premium liabilities of $3.6 million and $2.7 million and deferred revenue of $11.3 million and $11.5 million as of March 31, 2026 and December 31, 2025, respectively.
Other Liabilities—Other liabilities primarily includes a $50.0 million financing obligation that The Wheeling Corporation (“Wheeling”) entered into in January 2026 with Bank of Montreal to finance the lease of 400 railcars as of March 31, 2026. This was a failed sales-leaseback transaction that is treated as a financing obligation.
11
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
Amortization expense was $3.9 million and $2.9 million during the three months ended March 31, 2026 and 2025, respectively, and is included in Interest expense in the Consolidated Statements of Operations.
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 22 % of total revenues for the three months ended March 31, 2026 from one customer in the Railroad segment. Additionally, we earned approximately 7 % of total revenues for the three months ended March 31, 2026 from one customer in the Jefferson Terminal segment. We earned approximately 41 11
As of March 31, 2026, accounts receivable from three customers within the Jefferson Terminal, Railroad, and Corporate and Other segments represented 43 % of total accounts receivable, net. As of December 31, 2025, accounts receivable from three customers within the Jefferson Terminal and Railroad segments represented 41 % 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.
Accumulated Other Comprehensive Loss
Components of accumulated other comprehensive (loss) income at March 31, 2026 are as follows:
Three Months Ended March 31, 2026 | |||||||||||||||||
| Derivatives | Pension and other postretirement benefit accounts | Total | |||||||||||||||
Accumulated other comprehensive (loss) income - December 31, 2025 | $ | ( | $ | $ | ( | ||||||||||||
| Other comprehensive loss before reclassification | ( | ( | |||||||||||||||
| Amounts reclassified from accumulated other comprehensive (loss) income | ( | ||||||||||||||||
| Net current period other comprehensive (loss) income, net of tax | ( | ||||||||||||||||
| Accumulated other comprehensive (loss) income - March 31, 2026 | $ | ( | $ | $ | ( | ||||||||||||
Components of accumulated other comprehensive (loss) income at March 31, 2025 are as follows:
Three Months Ended March 31, 2025 | ||||||||||||||||||||||||||
| Derivatives | Equity method investee | Pension and other postretirement benefit accounts | Total | |||||||||||||||||||||||
| Accumulated other comprehensive (loss) income - December 31, 2024 | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||
| Other comprehensive loss before reclassification | ( | ( | ( | |||||||||||||||||||||||
| Amounts reclassified from accumulated other comprehensive loss | ( | ( | ||||||||||||||||||||||||
| Net current period other comprehensive (loss) income, net of tax | ( | ( | ||||||||||||||||||||||||
| Accumulated other comprehensive (loss) income - March 31, 2025 | $ | ( | $ | $ | $ | |||||||||||||||||||||
2. ACQUISITION OF SUBSIDIARIES
Acquisition of Long Ridge Energy & Power LLC
On February 26, 2025, the Company entered into a 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. This transaction resulted in a controlling 100% ownership in Long Ridge Energy & Power LLC. Long Ridge Energy & Power LLC operates within the Power and Gas reportable segment. See Note 14 for additional information.
Prior to obtaining a controlling interest in Long Ridge, the Company accounted for its 50.1 % investment as an equity method investment. In accordance with accounting for a step acquisition, the Company recognized a gain of $120.0 million, which was included in (Loss) gain on sale of assets, net in the Consolidated Statements of Operations. There was also an income tax benefit of $9.2 million recorded as part of Accumulated other comprehensive loss in the Consolidated Balance Sheets that was reclassified to Provision for (benefit from) income taxes in the Consolidated Statements of Operations.
12
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
In accordance with ASC 805, Business Combinations, the following fair values assigned to underlying assets acquired and liabilities assumed are based on management’s estimates and assumptions. The assumptions used to estimate the fair value of proved developed and unproved gas properties, as well as the power generation plant included forecasted revenue growth rates, discount rates, projected capacity factors and projected net gas production.
The following table summarizes the allocation of the purchase price, as presented in our Consolidated Balance Sheet:
February 26, 2025 | |||||
| Fair value of assets acquired: | |||||
| Cash and cash equivalents | $ | ||||
| Restricted cash | |||||
| Accounts receivable | |||||
| Property, plant and equipment | |||||
| Intangible assets | |||||
| Other assets | |||||
| Total assets acquired | |||||
| Fair value of liabilities assumed: | |||||
| Accounts payable and accrued liabilities | |||||
| Debt | |||||
| Derivative liabilities | |||||
| Other liabilities | |||||
| Total liabilities assumed | |||||
Goodwill (1) | |||||
| Total purchase consideration | $ | ||||
________________________________________________________
(1) This goodwill is assigned to the Power and Gas segment and is not tax deductible for income tax purposes.
The following table presents the estimated fair value of the identifiable intangible assets and their estimated useful lives:
| Estimated useful life in years | Fair value | ||||||||||
| Customer relationships | $ | ||||||||||
| Total | $ | ||||||||||
The following table presents the estimated fair value of the property, plant and equipment and their estimated remaining useful lives:
| Estimated remaining useful life in years | Fair value | ||||||||||
| Construction in progress | N/A | $ | |||||||||
| Unproved properties | N/A | ||||||||||
| Proved developed properties | N/A | ||||||||||
| Power generation | |||||||||||
| Computer software | |||||||||||
| Land and improvements | N/A | ||||||||||
| Buildings | |||||||||||
| Machinery & equipment | |||||||||||
| Track and track related assets | |||||||||||
| Vehicles | |||||||||||
| Total | $ | ||||||||||
13
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
The unaudited financial information in the table below summarizes the combined results of operations of FTAI Infrastructure and Long Ridge Energy & Power LLC on a pro forma basis, as though the companies had been combined as of January 1, 2024. These pro forma results were based on estimates and assumptions which we believe are reasonable. The pro forma adjustments are primarily comprised of the following:
•The allocation of the purchase price and related adjustments, including adjustments to depreciation and amortization expense related to the fair value of property, plant and equipment and intangible assets acquired;
•Elimination of intercompany transactions between consolidated companies;
•Impacts of debt assumed, including interest for debt issued, removal of interest for eliminated debt and removal of eliminated amortization of deferred financing costs; and
•Associated tax-related impacts of adjustments.
The pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place as of January 1, 2024.
| Three Months Ended March 31, 2025 | |||||
| Total revenue | $ | ||||
Net loss attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | ( | ||||
3. LEASING EQUIPMENT, NET
Leasing equipment, net is summarized as follows:
| March 31, 2026 | December 31, 2025 | ||||||||||
| Leasing equipment | $ | $ | |||||||||
| Less: Accumulated depreciation | ( | ( | |||||||||
| Leasing equipment, net | $ | $ | |||||||||
Depreciation expense for leasing equipment is summarized as follows:
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Depreciation expense for leasing equipment | $ | $ | |||||||||
14
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
4. PROPERTY, PLANT AND EQUIPMENT, NET
Property, plant and equipment, net is summarized as follows:
| March 31, 2026 | December 31, 2025 | ||||||||||
| Land, site improvements and rights | $ | $ | |||||||||
| Buildings and improvements | |||||||||||
| Bridges and tunnels | |||||||||||
| Terminal machinery and equipment | |||||||||||
| Proved oil and gas properties | |||||||||||
| Unproved oil and gas properties | |||||||||||
| Power plant | |||||||||||
| Track and track related assets | |||||||||||
| Railroad equipment | |||||||||||
| Railcars and locomotives | |||||||||||
| Computer hardware and software | |||||||||||
| Furniture and fixtures | |||||||||||
| Construction in progress | |||||||||||
| Other | |||||||||||
| Less: Accumulated depreciation | ( | ( | |||||||||
| Property, plant and equipment, net | $ | $ | |||||||||
Depreciation expense for property, plant and equipment is summarized as follows:
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Depreciation expense | $ | $ | |||||||||
5. INVESTMENTS
The following table presents the ownership interests and carrying values of our investments:
| Carrying Value | |||||||||||||||||||||||
| Investment | Ownership Percentage | March 31, 2026 | December 31, 2025 | ||||||||||||||||||||
| Intermodal Finance I, Ltd. | Equity method | $ | $ | ||||||||||||||||||||
| GM-FTAI Holdco LLC | Equity method | ||||||||||||||||||||||
| Pyroplast Energy LTD | Equity method | ||||||||||||||||||||||
| $ | $ | ||||||||||||||||||||||
The following table presents our proportionate share of equity in earnings (losses):
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
Intermodal Finance I, Ltd. | $ | $ | |||||||||
| Long Ridge Energy & Power LLC | |||||||||||
| Long Ridge West Virginia LLC | ( | ||||||||||
| GM-FTAI Holdco LLC | ( | ||||||||||
| Clean Planet Energy USA LLC | ( | ||||||||||
| Pyroplast Energy LTD | ( | ||||||||||
| Total | $ | ( | $ | ||||||||
15
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
Equity Investments
TimberHP Madison, LLC
On February 2, 2026, the Company invested $5.0 million in TimberHP Madison, LLC (“TimberHP”) as a Secured Promissory Note. The note matures on February 2, 2028 and has a current annual interest rate of 5 %. The interest is due at maturity.
6. INTANGIBLE ASSETS, NET
Intangible assets, net are summarized as follows:
| March 31, 2026 | |||||||||||||||||
| Power and Gas | Railroad | Total | |||||||||||||||
| Customer relationships | $ | $ | $ | ||||||||||||||
| Less: Accumulated amortization | ( | ( | ( | ||||||||||||||
Total intangible assets, net | $ | $ | $ | ||||||||||||||
| December 31, 2025 | |||||||||||||||||
| Power and Gas | Railroad | Total | |||||||||||||||
| Customer relationships | $ | $ | $ | ||||||||||||||
| Less: Accumulated amortization | ( | ( | ( | ||||||||||||||
Total intangible assets, net | $ | $ | $ | ||||||||||||||
Amortization of customer relationships is included in Depreciation and amortization in the Consolidated Statements of Operations and is as follows:
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Amortization of customer relationships | $ | $ | |||||||||
As of March 31, 2026, estimated net annual amortization of intangibles is as follows:
Remainder of 2026 | $ | ||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| Thereafter | |||||
| Total | $ | ||||
16
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(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 | March 31, 2026 | December 31, 2025 | ||||||||||||||||||||
| Loans payable | |||||||||||||||||||||||
DRP DB Term Loan (2) | 11/30/26 | $ | $ | ||||||||||||||||||||
Bridge Loan Credit Agreement (1) | (i) Base Rate + (ii) Base Rate + | 8/24/26 | |||||||||||||||||||||
Term Loan Credit Agreement (1) | 2/1/28 | ||||||||||||||||||||||
EB-5 Loan Agreement (2) | (i) 1/25/27 (ii) 3/11/27 (iii) 11/16/27 | ||||||||||||||||||||||
Jefferson Credit Agreement June 2025 | (i) Base Rate + (ii) Base Rate + | 8/31/26 | |||||||||||||||||||||
RailCo Revolver | (i) Base Rate + (ii) Base Rate + | 11/17/28 | |||||||||||||||||||||
Long Ridge Acquiom Loan | 6/7/26 | ||||||||||||||||||||||
Long Ridge GCM Note | 2/26/28 | ||||||||||||||||||||||
Long Ridge CanAm Loan | 9/13/29 | ||||||||||||||||||||||
Long Ridge Credit Agreement | (i) Base Rate + (ii) Base Rate + | 2/19/32 | |||||||||||||||||||||
| Total loans payable | |||||||||||||||||||||||
| Bonds payable | |||||||||||||||||||||||
Series 2020 Bonds (1) | (i) Tax Exempt Series 2020A Bonds: (ii) Tax Exempt Series 2020A Bonds: | (i) 1/1/35 (ii) 1/1/50 | |||||||||||||||||||||
Series 2021 Bonds (1) | (i) Tax Exempt Series 2021A Bonds: (ii) Taxable Series 2021B Bonds: | (i) 1/1/26 to 1/1/50 (ii) 1/1/28 | |||||||||||||||||||||
Series 2024 Bonds (1) (3) | (i) Tax Exempt Series 2024A Bonds: (ii) Taxable Series 2024B Bonds: | (i) 1/1/39 to 1/1/54 (ii) 7/1/26 | |||||||||||||||||||||
Series 2025 Bonds (1) | (i) Tax Exempt Series 2025 Bonds: (ii) Tax Exempt Series 2025 Bonds: | (i) 1/1/35 (ii) 1/1/45 | |||||||||||||||||||||
Senior Notes due 2032 | 2/15/32 | ||||||||||||||||||||||
| Total bonds payable | |||||||||||||||||||||||
Total debt | |||||||||||||||||||||||
| Less: Debt issuance costs | ( | ( | |||||||||||||||||||||
| Total debt, net | $ | $ | |||||||||||||||||||||
Principal debt due within one year | $ | $ | |||||||||||||||||||||
| Less: Debt issuance costs | ( | ( | |||||||||||||||||||||
Total principal debt, net due within one year | $ | $ | |||||||||||||||||||||
________________________________________________________
(1) Includes an unamortized discount of $51,446 and $36,313 at March 31, 2026 and December 31, 2025, respectively.
(2) See discussion in Note 8 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 for extension options related to these debt obligations.
(3) See below discussion in Note 7 for details related to the Backstop Agreement for the Series 2024 Bonds.
As of March 31, 2026 and December 31, 2025, the weighted average interest rates on our short-term borrowings were 11.0 % and 9.7 %, respectively.
17
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
June 2025 Jefferson Credit Agreement Extension and Paydown
In January 2026, Jefferson Terminal exercised its option to extend the maturity of its June 2025 Jefferson Credit Agreement to August 31, 2026. In March 2026, we used a portion of the Term Loan Credit Agreement net proceeds (see below) to repay in full and terminate the June 2025 Jefferson Credit Agreement.
Term Loan Credit Agreement
On February 25, 2026, we entered into a credit agreement (the “Term Loan Credit Agreement”), which provides for a $1.35 billion secured term loan facility (the “Term Loan”). The Term Loan matures on February 1, 2028 and accrues interest at a rate of 9.75 % per annum. On February 26, 2026, $1.3 billion of the Term Loan was funded, and the remaining $35.4 million was funded on March 10, 2026.
The Company used the net proceeds from the Term Loan to repay in full all outstanding principal and interest (together with fees, expenses and other amounts owed in connection therewith) under the Bridge Loan Credit Agreement and the June 2025 Jefferson Credit Agreement. We recognized a loss on extinguishment of debt of (i) $39.5 million from the repayment of the Bridge Loan Credit Agreement and (ii) $6.4 million from the repayment of the June 2025 Jefferson Credit Agreement in connection with this transaction.
In connection with the Term Loan, the Company and certain of its subsidiaries provided a first-priority security interest in substantially all of their respective assets, subject to customary exceptions and exclusions.
We incurred $5.6 million of issuance costs related to the Term Loan Credit Agreement.
Jefferson Terminal Backstop Agreement
On March 16, 2026, Jefferson Terminal signed a commitment letter for a Senior Secured Bridge Facility, pursuant to which the Company may, at its sole option, on or prior to July 1, 2026, elect to borrow from a lender funds in an aggregate principal amount of $255 million pursuant to a bridge facility that will have a maturity date which is 364 days after the close of such bridge facility. If utilized, the proceeds received would be required to be used to repurchase or redeem all outstanding Jefferson Taxable Series 2024B Bonds due July 1, 2026 to the extent that they have not been refinanced by long-term financing at that time.
We were in compliance with all debt covenants as of March 31, 2026.
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).
Our note receivable of $13.6
The fair value of our electricity derivative liabilities of $208.9 million and $223.5 million as of March 31, 2026 and December 31, 2025, respectively, are estimated by applying the income approach, which is based on discounted projected future cash flows, and are classified as Level 2 within the fair value hierarchy. The valuation of our electricity derivatives is based on management’s best estimate of certain key assumptions, which include estimated power forward curves, probability of default, and the discount rate.
18
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
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, and their 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. There have been no changes in Level 1, Level 2, and Level 3 and no changes in valuation techniques for financial instruments measured at fair value on a recurring basis for the periods ended March 31, 2026 and December 31, 2025.
FIP RR Holdings LLC (“RR Holdings”), a subsidiary of the Company, issued warrants (“Series A Warrants - RailCo”) in connection with the Wheeling Acquisition, in which the fair value of the warrant liabilities was estimated using a Black-Scholes valuation model, which is considered to be a Level 3 fair value measurement. The fair value of the Series A Warrants - RailCo is based on the underlying shares of RR Holdings. These liabilities are presented within Warrant liabilities on the Consolidated Balance Sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value of $0.9 The following table presents the key inputs applied in the valuation of the warrant liabilities:
| March 31, 2026 | December 31, 2025 | ||||||||||
| Number of units | |||||||||||
| Fair value at grant date ($ millions) | $ | $ | |||||||||
| Strike price | $ | $ | |||||||||
| Expected volatility | |||||||||||
| Risk free interest rate | |||||||||||
| Expected dividend yield | |||||||||||
| Expected term | |||||||||||
| Warrant fair value (per share) | $ | $ | |||||||||
Level 3 Reconciliation
The following is a reconciliation of the beginning and ending balances of recurring fair value measurements recognized in the accompanying Consolidated Balance Sheet using significant unobservable (Level 3) inputs:
| Warrants | |||||
| Beginning balance, December 31, 2025 | $ | ( | |||
| Purchases and issuances | |||||
| Unrealized losses | ( | ||||
| Ending balance, March 31, 2026 | $ | ( | |||
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:
| March 31, 2026 | December 31, 2025 | ||||||||||
Series 2020A Bonds (1) | $ | $ | |||||||||
Series 2021A Bonds (1) | |||||||||||
Series 2021B Bonds (1) | |||||||||||
Series 2024A Bonds (1) | |||||||||||
Series 2024B Bonds (1) | |||||||||||
Series 2025 Bonds (1) | |||||||||||
Senior Notes due 2032 (1) | |||||||||||
| EB-5 Loan Agreement | |||||||||||
| EB-5.2 Loan Agreement | |||||||||||
| EB-5.3 Loan Agreement | |||||||||||
(1) Fair value is based upon market prices for similar municipal securities.
19
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
The fair value of all other items reported as Debt, net in the Consolidated Balance Sheets approximates their carrying values due to their bearing market rates of interest and are classified as Level 2 within the fair value hierarchy.
9. DERIVATIVE FINANCIAL INSTRUMENTS
Long Ridge Energy & Power LLC is subject to electricity price volatility stemming from the sales of electricity from the Long Ridge power generation plant. Long Ridge Energy & Power LLC enters into electricity swap agreements to manage our exposure to electricity price fluctuations. The electricity swap derivatives are designated as hedging instruments within cash flow hedging relationships. The Company recognizes the realized gain or loss in Revenues in our Consolidated Statements of Operations.
As of March 31, 2026, we have a $10.0 million letter of credit and a $1.0 million letter of credit that have been provided to electricity swap counterparties and will mature on February 26, 2028 and February 10, 2027, respectively.
Refer to Note 8 for our fair value measurement of derivative financial instruments.
The following table presents information related to our outstanding derivative contracts as of March 31, 2026:
| March 31, 2026 | |||||||||||||||||||||||
| Notional Amount | Fair Value of Assets | Fair Value of Liabilities | Term | ||||||||||||||||||||
| Derivatives Designated as Cash Flow Hedges: | |||||||||||||||||||||||
| Electricity Swaps (MWh) | $ | $ | ( | ||||||||||||||||||||
| Non-Hedge Derivative Instruments: | |||||||||||||||||||||||
| Interest Rate Swaps ($) | ( | ||||||||||||||||||||||
| Natural Gas Forward Prices (MMBtu) | |||||||||||||||||||||||
| Total | $ | $ | ( | ||||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
| Notional Amount | Fair Value of Assets | Fair Value of Liabilities | Term | ||||||||||||||||||||
| Derivatives Designated as Cash Flow Hedges: | |||||||||||||||||||||||
| Electricity Swaps (MWh) | $ | $ | ( | ||||||||||||||||||||
| Non-Hedge Derivative Instruments: | |||||||||||||||||||||||
| Interest Rate Swaps ($) | ( | ||||||||||||||||||||||
| Natural Gas Forward Prices (MMBtu) | ( | ||||||||||||||||||||||
| Total | $ | $ | ( | ||||||||||||||||||||
20
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
The following table presents a summary of the changes in fair value for electricity swap, interest rate swap and natural gas forward derivatives:
| Three Months Ended March 31, 2026 | |||||||||||||||||||||||
| Electricity Swaps | Interest Rate Swaps | Natural Gas Forward | Total | ||||||||||||||||||||
| Beginning balance | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Net unrealized (losses) gains recognized in earnings (1) | ( | ||||||||||||||||||||||
| Net realized losses settled in other comprehensive loss | |||||||||||||||||||||||
| Unrealized losses recognized in other comprehensive loss | ( | ( | |||||||||||||||||||||
| Ending balance | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||
| Three Months Ended March 31, 2025 | |||||||||||||||||
| Electricity Swaps | Interest Rate Swaps | Total | |||||||||||||||
| Beginning balance | $ | $ | $ | ||||||||||||||
| Acquisition of derivative | ( | ( | |||||||||||||||
| Payoff of hedge | |||||||||||||||||
Net unrealized losses recognized in earnings (1) | ( | ( | |||||||||||||||
| Net realized losses settled in other comprehensive loss | |||||||||||||||||
| Unrealized losses recognized in other comprehensive loss | ( | ( | |||||||||||||||
| Ending balance | $ | ( | $ | ( | $ | ( | |||||||||||
________________________________________________________
(1) Interest rate swaps are recognized in Interest expense in the Consolidated Statements of Operations. Natural gas forwards are recognized in Revenues in the Consolidated Statements of Operations.
10. 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.
| Three Months Ended March 31, 2026 | |||||||||||||||||||||||||||||||||||
| Ports and Terminals | |||||||||||||||||||||||||||||||||||
| Railroad | Jefferson Terminal | Repauno | Power and Gas | Corporate and Other | Total | ||||||||||||||||||||||||||||||
| Lease income | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Rail revenues | |||||||||||||||||||||||||||||||||||
| Terminal services revenues | |||||||||||||||||||||||||||||||||||
| Roadside services revenues | |||||||||||||||||||||||||||||||||||
| Power revenues | |||||||||||||||||||||||||||||||||||
| Gas revenues | |||||||||||||||||||||||||||||||||||
| Other revenue | |||||||||||||||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
21
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
| Three Months Ended March 31, 2025 | |||||||||||||||||||||||||||||||||||
| Ports and Terminals | |||||||||||||||||||||||||||||||||||
| Railroad | Jefferson Terminal | Repauno | Power and Gas | Corporate and Other | Total | ||||||||||||||||||||||||||||||
| Lease income | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Rail revenues | |||||||||||||||||||||||||||||||||||
| Terminal services revenues | |||||||||||||||||||||||||||||||||||
| Roadside services revenues | |||||||||||||||||||||||||||||||||||
| Power revenues | |||||||||||||||||||||||||||||||||||
| Gas revenues | |||||||||||||||||||||||||||||||||||
| Other revenue | |||||||||||||||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
As of March 31, 2026 and December 31, 2025, we recorded capitalized contract cost of $17.3 million and $18.6 million, of which $4.7 million and $4.9 million are included in Other current assets and $12.6 million and $13.7 million are included in Other assets on the Consolidated Balance Sheets, respectively. Capitalized contract cost is amortized using the straight-line method, over the expected contract term. We recorded $1.2
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 March 31, 2026, the Incentive Plan provides for the issuance of up to 30.0 million shares. We account for equity-based compensation expense in accordance with ASC 718, Compensation – Stock Compensation and we report equity-based compensation within Operating expenses and General and administrative in the Consolidated Statements of Operations.
Director Compensation
During the three months ended March 31, 2026, we issued 984 shares of common stock to a certain director as compensation.
Stock Options
In connection with our February 2025 offering of Series B Preferred Stock ("Convertible Preferred Stock") (see Note 15), the Company issued to the Manager, options to purchase 2.9 million shares of common stock at a per share exercise price of $5.61 , which had a grant date fair value of $7.4 million.
Subsidiary Stock-Based Compensation
During the three months ended March 31, 2026, we issued restricted shares of our subsidiary that had a grant date fair value of $0.5 million and generally vest over three years. These awards are subject to continued employment, and the compensation expense is recognized ratably over the vesting periods. 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 following table presents the expense related to our subsidiary stock-based compensation arrangements recognized in the Consolidated Statements of Operations:
Expense Recognized During the Three Months Ended March 31, | Remaining Expense To Be Recognized, If All Vesting Conditions Are Met | Weighted Average Remaining Contractual Term (in years) | |||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Restricted shares | $ | $ | $ | ||||||||||||||||||||
| Common units | |||||||||||||||||||||||
| Total | $ | $ | $ | ||||||||||||||||||||
Restricted Stock Units to Subsidiary Employees
During the three months ended March 31, 2026, we issued restricted stock units (“RSUs”) of our common stock that had a grant date fair value of $16.1 million, based on the closing price of FIP’s stock on the grant date, and vest over three years. These
22
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
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.
The following table presents the expense related to our RSUs to subsidiary employees recognized in the Consolidated Statements of Operations:
Expense Recognized During the Three Months Ended March 31, | Remaining Expense To Be Recognized, If All Vesting Conditions Are Met | Weighted Average Remaining Contractual Term (in years) | |||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Restricted stock units | $ | $ | $ | ||||||||||||||||||||
| Total | $ | $ | $ | ||||||||||||||||||||
12. INCOME TAXES
Taxable income or loss generated by us and our corporate subsidiaries is subject to U.S. federal and state corporate income tax in locations where they conduct business.
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 the tax benefit associated with the current year net loss of certain subsidiaries that has been offset by a corresponding increase in the valuation allowance recorded against deferred tax assets.
As of and for the three months ended March 31, 2026, 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 and local income tax examinations by tax authorities. Generally, we are not subject to examination by taxing authorities for tax years prior to 2022.
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant changes to the U.S. federal tax law, such as an elective deduction for domestic research and experimental expenditures, and changes to interest expense limitations under Section 163(j). We have incorporated these amendments into the income tax provision which did not have a material impact on the Company’s effective tax rate.
13. 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 preferred stock and excluding non-controlling common 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, before series B preferred stock dividend and loss on extinguishment of preferred stock 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.
23
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
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 are recorded in the Management fees and incentive allocation to affiliate on the 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 financial statements.
Income Incentive Allocation and Capital Gains Incentive Allocation—The Income Incentive Fee and Capital Gains Incentive Fee are allocated to FTAI Infrastructure by applying the allocation calculation methodology described above to FTAI Infrastructure’s financial results in each respective period.
The following table summarizes the management fees, income incentive allocation and capital gains incentive allocation included in these consolidated financial statements:
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
Management fee | $ | $ | |||||||||
Income incentive fee | |||||||||||
Capital gains incentive fee | |||||||||||
| Total | $ | $ | |||||||||
We pay all of our operating expenses, except those specifically required to be borne by the Manager under the Management Agreement. The expenses required to be paid by the Company include, but are not limited to, issuance and transaction costs incident to the acquisition, disposition and financing of its assets, legal and auditing fees and expenses, the compensation and expenses of the Company’s independent directors, the costs associated with the establishment and maintenance of any credit facilities and other indebtedness (including commitment fees, legal fees, closing costs, etc.), expenses associated with other securities offerings, costs and expenses incurred in contracting with third parties (including affiliates of the Manager), the costs of printing and mailing proxies and reports to the stockholders, costs incurred by the Manager or its affiliates for travel on our behalf, costs associated with any computer software or hardware that is used by the Company, costs to obtain liability insurance to indemnify the Company’s directors and officers and the compensation and expenses of the transfer agent.
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:
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
Classification in the Consolidated Statements of Operations: | |||||||||||
General and administrative | $ | $ | |||||||||
| Acquisition and transaction expenses | |||||||||||
| Total | $ | $ | |||||||||
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
24
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
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 for services rendered in connection with the Redeemable Preferred Stock raise, as discussed in Note 15. On August 12, 2024, 8.7 million Manager options were exercised. In February 2025, we issued 2.9 million options to purchase common stock to the Manager, with a term of 10 years and a strike price of $5.61 as compensation for services rendered in connection with the offering of Series B Preferred Stock as discussed in Note 15.
The following table summarizes amounts due to the Manager, which are included within Accounts payable and accrued liabilities in the Consolidated Balance Sheets:
| March 31, 2026 | December 31, 2025 | ||||||||||
| Accrued management fees | $ | $ | |||||||||
| Other payables | |||||||||||
As of March 31, 2026 and December 31, 2025, there were no
Other Affiliate Transactions
As of March 31, 2026 and December 31, 2025, certain employees of the Manager and their related parties collectively own an approximately 20 176.4 ) million and $(162.8 ) 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:
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Non-controlling interest share of net loss | $ | ( | $ | ( | |||||||
In October 2022, we entered into a shareholder loan agreement with Long Ridge. Refer to Notes 2 and 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 three months ended March 31, 2026 and 2025, the Company incurred approximately $0.6 million and $0.1 million of 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.
14. SEGMENT INFORMATION
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.
Adjusted EBITDA is defined as net income (loss) attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock, adjusted (a) to exclude the impact of provision for (benefit from) income taxes, equity-based compensation expense, acquisition and transaction expenses, gains (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, before series B preferred stock dividend and loss on extinguishment of preferred stock, 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, before series B preferred stock dividend and loss on extinguishment of preferred stock as determined in accordance with U.S. GAAP.
25
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
The following tables set forth certain information for each reportable segment as provided to and evaluated by the CODM:
I. For the Three Months Ended March 31, 2026
| Three Months Ended March 31, 2026 | |||||||||||||||||||||||||||||||||||||||||
| Ports and Terminals | |||||||||||||||||||||||||||||||||||||||||
| Railroad | Jefferson Terminal | Repauno | Power and Gas | Sustainability and Energy Transition | Corporate and Other | Total | |||||||||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Expenses | |||||||||||||||||||||||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||||||||||||||||
| General and administrative | |||||||||||||||||||||||||||||||||||||||||
| Acquisition and transaction expenses | |||||||||||||||||||||||||||||||||||||||||
| Management fees and incentive allocation to affiliate | |||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||||||||||||||||||||
| Total expenses | |||||||||||||||||||||||||||||||||||||||||
| Other (expense) income | |||||||||||||||||||||||||||||||||||||||||
| Equity in losses of unconsolidated entities | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Gain (loss) on sale of assets, net | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Loss on modification or extinguishment of debt | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Interest expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Other (expense) income | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Total other (expense) income | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Income (loss) before income taxes | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||
| Provision for income taxes | |||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||
| Less: Net (loss) income attributable to non-controlling interests in consolidated subsidiaries - common stockholders | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||
| Less: Preferred dividends and accretion on redeemable non-controlling interests | |||||||||||||||||||||||||||||||||||||||||
| Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||||||||||||||
26
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
The following table sets forth a reconciliation of Adjusted EBITDA to net income (loss) attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock:
| Three Months Ended March 31, 2026 | |||||||||||||||||||||||||||||||||||||||||
| Ports and Terminals | |||||||||||||||||||||||||||||||||||||||||
| Railroad | Jefferson Terminal | Repauno | Power and Gas | Sustainability and Energy Transition | Corporate and Other | Total | |||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
| Add: Non-controlling share of Adjusted EBITDA | |||||||||||||||||||||||||||||||||||||||||
| Add: Equity in losses of unconsolidated entities | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Less: Interest and other costs on pension and OPEB liabilities | |||||||||||||||||||||||||||||||||||||||||
| Less: Dividends and accretion of redeemable preferred stock | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Less: Pro-rata share of Adjusted EBITDA from unconsolidated entities | |||||||||||||||||||||||||||||||||||||||||
| Less: Interest expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Less: Depreciation and amortization expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Less: Incentive allocations | |||||||||||||||||||||||||||||||||||||||||
| Less: Asset impairment charges | |||||||||||||||||||||||||||||||||||||||||
| Less: Changes in fair value of non-hedge derivative instruments | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Less: Losses on the modification or extinguishment of debt and capital lease obligations | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Less: Acquisition and transaction expenses | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
| Less: Equity-based compensation expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Less: (Provision for) benefit from income taxes | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
| Less: Other non-recurring items | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||||||||||||||
27
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
II. Three Months Ended March 31, 2025
| Three Months Ended March 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
Ports and Terminals | |||||||||||||||||||||||||||||||||||||||||
| Railroad | Jefferson Terminal | Repauno | Power and Gas | Sustainability and Energy Transition | Corporate and Other | Total | |||||||||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Expenses | |||||||||||||||||||||||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||||||||||||||||
| General and administrative | |||||||||||||||||||||||||||||||||||||||||
| Acquisition and transaction expenses | ( | ||||||||||||||||||||||||||||||||||||||||
| Management fees and incentive allocation to affiliate | |||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||||||||||||||||||||
| Total expenses | |||||||||||||||||||||||||||||||||||||||||
| Other income (expense) | |||||||||||||||||||||||||||||||||||||||||
| Equity in earnings (losses) of unconsolidated entities | ( | ||||||||||||||||||||||||||||||||||||||||
| (Loss) gain on sale of assets, net | ( | ||||||||||||||||||||||||||||||||||||||||
| Loss on modification or extinguishment of debt | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Interest expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Other income | |||||||||||||||||||||||||||||||||||||||||
| Total other income (expense) | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
| Income (loss) before income taxes | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
| Provision for (benefit from) income taxes | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Net income (loss) | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||
| Less: Net income (loss) attributable to non-controlling interests in consolidated subsidiaries | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Less: Dividends and accretion of redeemable preferred stock | |||||||||||||||||||||||||||||||||||||||||
| Net income (loss) attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||||
28
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
The following table sets forth a reconciliation of Adjusted EBITDA to net income (loss) attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock:
| Three Months Ended March 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
Ports and Terminals | |||||||||||||||||||||||||||||||||||||||||
| Railroad | Jefferson Terminal | Repauno | Power and Gas | Sustainability and Energy Transition | Corporate and Other | Total | |||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | $ | $ | ( | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||||||||||||
| Add: Non-controlling share of Adjusted EBITDA | |||||||||||||||||||||||||||||||||||||||||
| Add: Equity in earnings (losses) of unconsolidated entities | ( | ||||||||||||||||||||||||||||||||||||||||
| Less: Interest and other costs on pension and OPEB liabilities | |||||||||||||||||||||||||||||||||||||||||
| Less: Dividends and accretion of redeemable preferred stock | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Less: Pro-rata share of Adjusted EBITDA from unconsolidated entities | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Less: Interest expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Less: Depreciation and amortization expense | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Less: Incentive allocations | |||||||||||||||||||||||||||||||||||||||||
| Less: Asset impairment charges | |||||||||||||||||||||||||||||||||||||||||
| Less: Changes in fair value of non-hedge derivative instruments | |||||||||||||||||||||||||||||||||||||||||
| Less: Losses on the modification or extinguishment of debt and capital lease obligations | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Less: Acquisition and transaction expenses | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||
| Less: Equity-based compensation expense | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||
| Less: (Provision for) benefit from income taxes | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Less: Other non-recurring items | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Net income (loss) attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||||
29
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
III. Balance Sheet
The following tables set forth the summarized balance sheet. All property, plant and equipment and leasing equipment are located in North America.
| March 31, 2026 | |||||||||||||||||||||||||||||||||||||||||
| Ports and Terminals | |||||||||||||||||||||||||||||||||||||||||
| Railroad | Jefferson Terminal | Repauno | Power and Gas | Sustainability and Energy Transition | Corporate and Other | Total | |||||||||||||||||||||||||||||||||||
| Current assets | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Non-current assets | |||||||||||||||||||||||||||||||||||||||||
| Total assets | |||||||||||||||||||||||||||||||||||||||||
| Total debt, net | |||||||||||||||||||||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||||||||||||||||||||
| Non-current liabilities | |||||||||||||||||||||||||||||||||||||||||
| Total liabilities | |||||||||||||||||||||||||||||||||||||||||
| Redeemable preferred stock | |||||||||||||||||||||||||||||||||||||||||
| Non-controlling interests in equity of consolidated subsidiaries | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Total equity | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Total liabilities, redeemable preferred stock and equity | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
| Ports and Terminals | |||||||||||||||||||||||||||||||||||||||||
| Railroad | Jefferson Terminal | Repauno | Power and Gas | Sustainability and Energy Transition | Corporate and Other | Total | |||||||||||||||||||||||||||||||||||
| Current assets | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Non-current assets | |||||||||||||||||||||||||||||||||||||||||
| Total assets | |||||||||||||||||||||||||||||||||||||||||
| Total debt, net | |||||||||||||||||||||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||||||||||||||||||||
| Non-current liabilities | |||||||||||||||||||||||||||||||||||||||||
| Total liabilities | |||||||||||||||||||||||||||||||||||||||||
| Redeemable preferred stock | |||||||||||||||||||||||||||||||||||||||||
| Non-controlling interests in equity of consolidated subsidiaries | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Total equity | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Total liabilities, redeemable preferred stock and equity | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
30
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
15. REDEEMABLE PREFERRED STOCK
Series B Preferred Stock - Redeemable Convertible Preferred Stock
As of March 31, 2026, the Company has $18.5 million of cumulative dividends increasing the liquidation preference on the Series B Preferred Stock. Dividends are not recorded as redemption is not currently expected.
If the Series B Preferred Stock were redeemed due to a change in control as of March 31, 2026, it would be redeemable for $182.0 million.
If the Series B Preferred Stock were converted at the option of the holder as of March 31, 2026, it would be converted to 21,818,025 shares of common stock. The Company would have no obligation under the Share Cap to pay cash on an optional conversion at March 31, 2026.
Series A Preferred Stock - RailCo - Redeemable Preferred Stock - Non-Controlling Interest
As of March 31, 2026, RR Holdings had $64.4 million of PIK dividends increasing its Series A Preferred Units (“Series A Preferred Stock - RailCo”) balance. Dividends recorded in Dividends and accretion of redeemable preferred stock on the Consolidated Statements of Operations totaled $27.0
The Company has presented the Series A Preferred Stock - RailCo in temporary equity and is accreting the discount and issuance costs using the interest method to the earliest redemption date of August 25, 2032. Such accretion, recorded in Dividends and accretion of redeemable preferred stock on the Consolidated Statements of Operations, totaled $5.2
As of March 31, 2026, the Series A Preferred Stock - RailCo shares would be redeemable at a redemption price per share of $1,417.49 .
16. EARNINGS PER SHARE AND EQUITY
Basic (loss) earnings per share of common stock is calculated by dividing net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock by the weighted average number of shares of common stock outstanding. Diluted (loss) earnings per share is calculated by dividing net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock by the weighted average number of shares 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 (loss) earnings per share is presented below:
Three Months Ended March 31, | |||||||||||
| (in thousands, except per share data) | 2026 | 2025 | |||||||||
Net (loss) income | $ | ( | $ | ||||||||
| Less: Net loss attributable to non-controlling interests in consolidated subsidiaries | ( | ( | |||||||||
| Less: Preferred dividends and accretion on redeemable non-controlling interests | |||||||||||
| Less: Dividends and accretion of redeemable preferred stock | |||||||||||
Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | ( | ||||||||||
Less: Convertible preferred stock dividend | |||||||||||
Net (loss) income attributable to common stockholders | $ | ( | $ | ||||||||
Weighted Average Common Stock Outstanding - Basic | |||||||||||
Weighted Average Common Stock Outstanding - Diluted | |||||||||||
(Loss) earnings per share: | |||||||||||
| Basic | $ | ( | $ | ||||||||
Diluted (1) | $ | ( | $ | ||||||||
(1) Diluted (loss) earnings per share for the three months ended March 31, 2026 and 2025 includes the dilutive effect of subsidiary earnings per share and convertible preferred stock.
For the three months ended March 31, 2026 and 2025, 23,783,649 and — shares of common stock, respectively, have been excluded from the calculation of Diluted loss per share because the impact would be anti-dilutive.
31
FTAI INFRASTRUCTURE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
(Dollars in tables in thousands, unless otherwise noted)
Common Stock Warrants
As of March 31, 2026, there were no changes to the number of the Company’s outstanding equity classified stock warrants. The weighted average exercise price was $9.64 and $9.76 as of March 31, 2026 and December 31, 2025, respectively. The weighted average exercise price as of March 31, 2026 includes adjustments for quarterly dividend payments.
The weighted average remaining contractual term of the outstanding warrants as of March 31, 2026 is 4.3 years. The aggregate intrinsic value of the warrants as of March 31, 2026 is $— million.
17. 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.
18. SUBSEQUENT EVENTS
Long Ridge Acquiom Loan Amendment
On April 29, 2026, Long Ridge Energy & Power LLC entered into Third Amendment to Credit Agreement, which amended the Long Ridge Acquiom Loan to, among other things, refinance all outstanding indebtedness under the existing Long Ridge Acquiom Loan and borrow an additional $10.0 million in the form of incremental loans for working capital and other general corporate purposes.
Sale of Long Ridge Energy & Power LLC
On April 29, 2026, Ohio River Partners Holdco LLC (“ORPH”), a Delaware limited liability company and a direct wholly-owned subsidiary of FTAI Infrastructure, Ohio River Partners Finance LLC, a Delaware limited liability company and a direct wholly-owned subsidiary of ORPH (together with ORPH, “Sellers”), and, solely for the purposes specified, FTAI Infrastructure entered into an equity purchase agreement (the “Agreement”) with MARA USA Corporation (“Buyer”), a Delaware corporation and a direct wholly-owned subsidiary of MARA Holdings, Inc. (“Buyer Parent”), and, solely for the purposes specified, Buyer Parent, pursuant to which, among other things, upon the terms and subject to the conditions set forth in the Agreement, Buyer will purchase all of the issued and outstanding membership interests of Long Ridge Energy & Power LLC, a Delaware limited liability company and an indirect wholly-owned subsidiary of FTAI Infrastructure, from Sellers, for a base purchase price of $1.52 billion, subject to certain customary adjustments set forth in the Agreement.
Refer to the Company’s Form 8-K which was filed with the Securities and Exchange Commission on April 30, 2026 for further information.
Dividends
On May 7, 2026, our board of directors declared a cash dividend on our common stock of $0.03 per share for the quarter ended March 31, 2026, payable on June 12, 2026 to the holders of record on May 18, 2026.
32
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help you understand FTAI Infrastructure Inc. (“we”, “us”, “our”, or the “Company”). Our MD&A should be read in conjunction with our unaudited consolidated financial statements and the accompanying notes, and with Part II, Item 1A, “Risk Factors” and “Forward-Looking Statements” included elsewhere in this Quarterly Report on Form 10-Q.
Overview
We are in the business of acquiring, developing and operating assets and businesses that represent critical infrastructure for customers in the transportation, energy and industrial products industries. We were formed on December 13, 2021 as FTAI Infrastructure LLC, a Delaware limited liability company and subsidiary of FTAI Aviation Ltd. (previously Fortress Transportation and Infrastructure Investors LLC; “FTAI” or “Former Parent”). We are a publicly-traded company trading on The Nasdaq Global Select Market under the symbol “FIP.”
Our operations consist of four primary business lines: (i) Railroad, (ii) Ports and Terminals, (iii) Power and Gas and (iv) Sustainability and Energy Transition. Our Railroad business primarily invests in and operates short line and regional railroads in North America. Our Ports and Terminals business, consisting of our Jefferson Terminal and Repauno segments, develops or acquires industrial properties in strategic locations that store and handle for third parties a variety of energy products, including crude oil, refined products and clean fuels. Our Power and Gas business develops and operates facilities, such as a 485 megawatt power plant at the Long Ridge terminal in Ohio, that leverage the property’s location and key attributes to generate incremental value. Our Sustainability and Energy Transition business focuses on investments in companies and assets that utilize green technology, produce sustainable fuels and products or enable customers to reduce their carbon footprint.
We expect to continue to invest in such market sectors, and pursue additional investment opportunities in other infrastructure businesses and assets we believe to be attractive and meet our investment objectives. Our team focuses on acquiring a diverse group of long-lived assets or operating businesses that provide mission-critical services or functions to infrastructure networks and typically have high barriers to entry, strong margins, stable cash flows and upside from earnings growth and asset appreciation driven by increased use and inflation. We believe that there are a large number of acquisition opportunities in our markets and that our Manager’s expertise and business and financing relationships, together with our access to capital and generally available capital for infrastructure projects in today’s marketplace, will allow us to take advantage of these opportunities. As of March 31, 2026, we had total consolidated assets of $5.7 billion and redeemable preferred stock and equity of $820.1 million.
Operating Segments
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.
Our Manager
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.
Results of Operations
Adjusted EBITDA (Non-GAAP)
The CODM utilizes Adjusted EBITDA as the key performance measure. Adjusted EBITDA is not a financial measure in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). This performance measure provides the CODM with the information necessary to assess operational performance, as well as make resource and allocation decisions. We believe Adjusted EBITDA is a useful metric for investors and analysts for similar purposes of assessing our operational performance.
Adjusted EBITDA is defined as net income (loss) attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock, adjusted (a) to exclude the impact of provision for (benefit from) income taxes, equity-based compensation expense, acquisition and transaction expenses, gains (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, before series B preferred stock dividend and loss on extinguishment of preferred stock, as defined by U.S. GAAP, is the most appropriate earnings measure with which to reconcile
33
Adjusted EBITDA. Adjusted EBITDA should not be considered as an alternative to net income (loss) attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock as determined in accordance with U.S. GAAP.
Comparison of the three months ended March 31, 2026 and 2025
The following table presents our consolidated results of operations:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Revenues | |||||||||||||||||
| Lease income | $ | 2,495 | $ | 1,337 | $ | 1,158 | |||||||||||
| Rail revenues | 82,293 | 42,174 | 40,119 | ||||||||||||||
| Terminal services revenues | 28,308 | 22,705 | 5,603 | ||||||||||||||
| Roadside services revenues | 12,554 | 12,976 | (422) | ||||||||||||||
| Power revenues | 45,628 | 15,780 | 29,848 | ||||||||||||||
| Gas revenues | 15,956 | 1,188 | 14,768 | ||||||||||||||
| Other revenue | 1,130 | 1 | 1,129 | ||||||||||||||
| Total revenues | 188,364 | 96,161 | 92,203 | ||||||||||||||
| Expenses | |||||||||||||||||
| Operating expenses | 120,394 | 67,045 | 53,349 | ||||||||||||||
| General and administrative | 3,554 | 5,113 | (1,559) | ||||||||||||||
| Acquisition and transaction expenses | 6,820 | 3,515 | 3,305 | ||||||||||||||
| Management fees and incentive allocation to affiliate | 4,092 | 2,542 | 1,550 | ||||||||||||||
| Depreciation and amortization | 50,691 | 25,012 | 25,679 | ||||||||||||||
| Total expenses | 185,551 | 103,227 | 82,324 | ||||||||||||||
| Other (expense) income | |||||||||||||||||
| Equity in (losses) earnings of unconsolidated entities | (518) | 5,314 | (5,832) | ||||||||||||||
| (Loss) gain on sale of assets, net | (566) | 119,828 | (120,394) | ||||||||||||||
| Loss on modification or extinguishment of debt | (45,914) | (7) | (45,907) | ||||||||||||||
| Interest expense | (82,487) | (43,112) | (39,375) | ||||||||||||||
| Other income | 2,984 | 3,693 | (709) | ||||||||||||||
| Total other (expense) income | (126,501) | 85,716 | (212,217) | ||||||||||||||
| (Loss) income from before income taxes | (123,688) | 78,650 | (202,338) | ||||||||||||||
| Provision for (benefit from) income taxes | 3,523 | (41,514) | 45,037 | ||||||||||||||
| Net (loss) income | (127,211) | 120,164 | (247,375) | ||||||||||||||
| Less: Net loss attributable to non-controlling interest in consolidated subsidiaries - common stockholders | (14,260) | (11,401) | (2,859) | ||||||||||||||
| Less: Preferred dividends and accretion on redeemable non-controlling interests | 37,221 | — | 37,221 | ||||||||||||||
| Less: Dividends and accretion of redeemable preferred stock | — | 21,841 | (21,841) | ||||||||||||||
| Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (150,172) | $ | 109,724 | $ | (259,896) | |||||||||||
34
The following table sets forth a reconciliation of net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock to Adjusted EBITDA:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (150,172) | $ | 109,724 | $ | (259,896) | |||||||||||
| Add: Provision for (benefit from) income taxes | 3,523 | (41,514) | 45,037 | ||||||||||||||
| Add: Equity-based compensation expense | 10,978 | 1,253 | 9,725 | ||||||||||||||
| Add: Acquisition and transaction expenses | 6,820 | 3,515 | 3,305 | ||||||||||||||
| Add: Losses on the modification or extinguishment of debt and capital lease obligations | 45,914 | 7 | 45,907 | ||||||||||||||
| Add: Changes in fair value of non-hedge derivative instruments | 558 | — | 558 | ||||||||||||||
| Add: Asset impairment charges | — | — | — | ||||||||||||||
| Add: Incentive allocations | — | — | — | ||||||||||||||
Add: Depreciation and amortization expense (1) | 41,688 | 24,657 | 17,031 | ||||||||||||||
| Add: Interest expense | 82,487 | 43,112 | 39,375 | ||||||||||||||
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (2) | (518) | 4,500 | (5,018) | ||||||||||||||
| Add: Dividends and accretion of redeemable preferred stock | 37,221 | 21,841 | 15,380 | ||||||||||||||
| Add: Interest and other costs on pension and OPEB liabilities | (180) | (265) | 85 | ||||||||||||||
Add: Other non-recurring items (3) | 2,661 | 1,035 | 1,626 | ||||||||||||||
| Less: Equity in losses (earnings) of unconsolidated entities | 518 | (5,314) | 5,832 | ||||||||||||||
Less: Non-controlling share of Adjusted EBITDA (4) | (10,906) | (7,332) | (3,574) | ||||||||||||||
| Adjusted EBITDA (Non-GAAP) | $ | 70,592 | $ | 155,219 | $ | (84,627) | |||||||||||
________________________________________________________
(1) Includes the following items for the three months ended March 31, 2026 and 2025: (i) depreciation and amortization expense of $50,691 and $25,012, (ii) capitalized contract costs amortization of $1,233 and $1,233 and (iii) amortization of other comprehensive income of $(10,236) and $(1,588), respectively.
(2) Includes the following items for the three months ended March 31, 2026 and 2025: (i) net (loss) income of $(518) and $6,578, (ii) interest expense of $— and $7,648, (iii) depreciation and amortization expense of $— and $2,884, (iv) acquisition and transaction expenses of $— and $201, (v) changes in fair value of non-hedge derivative instruments of $— and $(12,822), (vi) equity method basis adjustments of $— and $10 and (vii) other non-recurring items of $— and $1, respectively.
(3) Includes the following items for the three months ended March 31, 2026: (i) Railroad severance and integration expenses of $1,471 and (ii) unrealized loss on investment of $1,190. Includes the following items for the three months ended March 31, 2025: (i) incidental utility rebillings of $650 and (ii) loss on inventory heel of $385.
(4) Includes the following items for the three months ended March 31, 2026 and 2025: (i) equity-based compensation expense of $1,772 and $138, (ii) provision for income taxes of $66 and $104, (iii) interest expense of $4,052 and $3,940, (iv) depreciation and amortization expense of $3,331 and $3,069, (v) acquisition and transaction expenses of $15 and $1, (vi) interest and other costs on pension and OPEB liabilities of $— and $(2), (vii) asset impairment charges of $— and $19, (viii) losses on the modification or extinguishment of debt of $1,489 and $2, (ix) dividends and accretion of redeemable preferred stock of $175 and $— and (x) other non-recurring items of $6 and $61, respectively.
Revenue
Comparison of the three months ended March 31, 2026 and 2025
Total revenues increased $92.2 million due to higher revenues of $44.7 million in the Power and Gas segment, $42.4 million in the Railroad segment and $7.9 million in the Jefferson Terminal segment, offset by lower revenues of $2.6 million in the Repauno segment.
Rail revenues increased $40.1 million primarily due to the completed acquisition and consolidation of Wheeling in December 2025 and increased carloads in the Railroad segment.
Terminal services revenues increased $5.6 million primarily due to an increase in average refined product throughput volumes in the Jefferson Terminal segment, offset by lower volumes stemming from the terminal’s current butane contract compared to the prior period contract that ended in March 2025 in the Repauno segment.
Power revenues increased $29.8 million due to the acquisition of Long Ridge Energy & Power LLC in February 2025.
Gas revenues increased $14.8 million due to the acquisition of Long Ridge Energy & Power LLC in February 2025.
35
Expenses
Comparison of the three months ended March 31, 2026 and 2025
Total expenses increased $82.3 million primarily due to increases in (i) operating expenses, (ii) depreciation and amortization and (iii) acquisition and transaction expenses.
Operating expenses increased $53.3 million which primarily reflects:
•an increase of $21.5 million primarily related to increased Ohio GasCo LLC and Long Ridge West Virginia LLC well operations and full inclusion of operating expenses after the acquisition of 100% of Long Ridge in February 2025 in the Power and Gas segment;
•an increase of $7.7 million primarily due to costs associated with stock-based compensation and costs associated with increased terminal throughput activity at Jefferson Terminal; and
•an increase of $23.8 million in the Railroad segment mainly due to the full inclusion of operating expenses of Wheeling after the acquisition in December 2025.
Acquisition and transaction expenses increased $3.3 million primarily due to (i) an increase in legal and consulting fees in the Railroad segment related to the acquisition of Wheeling in December 2025 and (ii) costs incurred with debt refinancing activities and professional fees related to the Wheeling acquisition in the Corporate and Other segment.
Depreciation and amortization increased $25.7 million primarily due to additional assets at Long Ridge Energy & Power LLC after the acquisition in February 2025 and additional assets at the Railroad segment after the acquisition of Wheeling in December 2025.
Other (expense) income
Total other expense increased $212.2 million during the three months ended March 31, 2026 primarily due to:
•an increase in loss on modification or extinguishment of debt of $45.9 million due to loss on extinguishment of the Bridge Loan Credit Agreement in the Corporate and Other segment and the June 2025 Jefferson Credit Agreement in the Jefferson Terminal segment;
•an increase in interest expense of $39.4 million primarily due to an increase in the average outstanding debt of approximately $1.4 billion which primarily consists of (i) $697.8 million for the Corporate Bridge Loan, (ii) $350.4 million for the Series 2025 Bonds, (iii) $392.3 million for Long Ridge Energy & Power LLC debt and (iv) $50.0 million for the RailCo Revolver; and
•a decrease in gain on sale of assets of $120.4 million primarily due to a prior year gain from the acquisition of 100% of Long Ridge in February 2025; and
•an increase of $5.8 million in equity in losses of unconsolidated entities primarily due to the equity pickup of Long Ridge Energy & Power LLC net earnings in the prior year that were not recognized in the current quarter since 100% of Long Ridge Energy & Power LLC was acquired in February 2025, and therefore no equity pickup was recorded after the acquisition, offset by a decrease in equity in losses of unconsolidated entities in the Sustainability and Energy Transition segment due to lower operating losses at GM-FTAI Holdco LLC.
Provision for (benefit from) income taxes
Provision for income taxes increased $45.0 million during the three months ended March 31, 2026 primarily due to the partial release of the valuation allowance in connection with the acquisition of Long Ridge Energy & Power LLC in February 2025.
Net (loss) income
Net loss increased $247.4 million during the three months ended March 31, 2026 primarily due to the changes noted above.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA decreased $84.6 million during the three months ended March 31, 2026 primarily due to the changes noted above.
36
Railroad Segment
The following table presents our results of operations:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Revenues | |||||||||||||||||
| Lease income | $ | 1,855 | $ | 457 | $ | 1,398 | |||||||||||
| Rail revenues | 82,023 | 42,174 | 39,849 | ||||||||||||||
| Other revenue | 1,130 | — | 1,130 | ||||||||||||||
| Total revenues | 85,008 | 42,631 | 42,377 | ||||||||||||||
| Expenses | |||||||||||||||||
| Operating expenses | 46,764 | 22,939 | 23,825 | ||||||||||||||
| Acquisition and transaction expenses | 1,608 | 93 | 1,515 | ||||||||||||||
| Depreciation and amortization | 19,487 | 5,086 | 14,401 | ||||||||||||||
| Total expenses | 67,859 | 28,118 | 39,741 | ||||||||||||||
| Other income (expense) | |||||||||||||||||
| Gain (loss) on sale of assets, net | 7 | (124) | 131 | ||||||||||||||
| Interest expense | (1,499) | (139) | (1,360) | ||||||||||||||
| Other (expense) income | (514) | 388 | (902) | ||||||||||||||
| Total other (expense) income | (2,006) | 125 | (2,131) | ||||||||||||||
| Income before income taxes | 15,143 | 14,638 | 505 | ||||||||||||||
| Provision for income taxes | 3,298 | 812 | 2,486 | ||||||||||||||
| Net income | 11,845 | 13,826 | (1,981) | ||||||||||||||
| Less: Net (loss) income attributable to non-controlling interest in consolidated subsidiaries - common stockholders | (162) | 87 | (249) | ||||||||||||||
| Less: Preferred dividends and accretion on redeemable non-controlling interests | 37,221 | — | 37,221 | ||||||||||||||
| Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (25,214) | $ | 13,739 | $ | (38,953) | |||||||||||
37
The following table sets forth a reconciliation of net (loss) income attributable to stockholders to Adjusted EBITDA, before series B preferred stock dividend and loss on extinguishment of preferred stock to Adjusted EBITDA:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (25,214) | $ | 13,739 | $ | (38,953) | |||||||||||
| Add: Provision for income taxes | 3,298 | 812 | 2,486 | ||||||||||||||
| Add: Equity-based compensation expense | 447 | 358 | 89 | ||||||||||||||
| Add: Acquisition and transaction expenses | 1,608 | 93 | 1,515 | ||||||||||||||
| Add: Losses on the modification or extinguishment of debt and capital lease obligations | — | — | — | ||||||||||||||
| Add: Changes in fair value of non-hedge derivative instruments | 906 | — | 906 | ||||||||||||||
| Add: Asset impairment charges | — | — | — | ||||||||||||||
| Add: Incentive allocations | — | — | — | ||||||||||||||
| Add: Depreciation and amortization expense | 19,487 | 5,086 | 14,401 | ||||||||||||||
| Add: Interest expense | 1,499 | 139 | 1,360 | ||||||||||||||
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities | — | — | — | ||||||||||||||
| Add: Dividends and accretion of redeemable preferred stock | 37,221 | — | 37,221 | ||||||||||||||
| Add: Interest and other costs on pension and OPEB liabilities | (180) | (265) | 85 | ||||||||||||||
Add: Other non-recurring items (1) | 1,471 | — | 1,471 | ||||||||||||||
| Less: Equity in earnings of unconsolidated entities | — | — | — | ||||||||||||||
Less: Non-controlling share of Adjusted EBITDA (2) | (310) | (38) | (272) | ||||||||||||||
| Adjusted EBITDA (Non-GAAP) | $ | 40,233 | $ | 19,924 | $ | 20,309 | |||||||||||
________________________________________________________
(1) Includes the following items for the three months ended March 31, 2026: Railroad severance and integration expenses of $1,471.
(2) Includes the following items for the three months ended March 31, 2026 and 2025: (i) equity-based compensation expense of $2 and $2, (ii) provision for income taxes of $16 and $5, (iii) interest expense of $7 and $1, (iv) depreciation and amortization expense of $92 and $31, (v) acquisition and transaction expenses of $8 and $1, (vi) interest and other costs on pension and OPEB liabilities of $— and $(2), (vii) dividends and accretion of redeemable preferred stock of $175 and $—, (viii) changes in fair value of non-hedge derivative instruments of $4 and $— and (ix) other non-recurring items of $6 and $—, respectively.
Revenues
Total revenues increased $42.4 million during the three months ended March 31, 2026 primarily due to the completed acquisition and consolidation of Wheeling in December 2025 and increased carloads.
Expenses
Total expenses increased $39.7 million during the three months ended March 31, 2026, which primarily reflects:
•an increase in operating expenses of $23.8 million due to the completed acquisition and consolidation of Wheeling in December 2025;
•an increase in acquisition and transaction costs of $1.5 million related to the completed acquisition and consolidation of Wheeling in December 2025; and
•an increase in depreciation and amortization expense of $14.4 million related to depreciation expense on Wheeling assets due to the completed acquisition and consolidation in December 2025.
Other income (expense)
Total other expense increased $2.1 million during the three months ended March 31, 2026 which primarily reflects an increase in interest expense on the RailCo Revolver taken in November 2025.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA increased $20.3 million during the three months ended March 31, 2026 primarily due to the activity noted above.
38
Jefferson Terminal Segment
The following table presents our results of operations:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Revenues | |||||||||||||||||
| Lease income | $ | 640 | $ | 880 | $ | (240) | |||||||||||
| Terminal services revenues | 26,678 | 18,569 | 8,109 | ||||||||||||||
| Total revenues | 27,318 | 19,449 | 7,869 | ||||||||||||||
| Expenses | |||||||||||||||||
| Operating expenses | 25,813 | 18,094 | 7,719 | ||||||||||||||
| Acquisition and transaction expenses | — | (1) | 1 | ||||||||||||||
| Depreciation and amortization | 11,987 | 11,240 | 747 | ||||||||||||||
| Total expenses | 37,800 | 29,333 | 8,467 | ||||||||||||||
| Other (expense) income | |||||||||||||||||
| Loss on modification or extinguishment of debt | (6,429) | (7) | (6,422) | ||||||||||||||
| Interest expense | (16,235) | (16,624) | 389 | ||||||||||||||
| Other income | 807 | 726 | 81 | ||||||||||||||
| Total other expense | (21,857) | (15,905) | (5,952) | ||||||||||||||
| Loss before income taxes | (32,339) | (25,789) | (6,550) | ||||||||||||||
| Provision for income taxes | 212 | 423 | (211) | ||||||||||||||
| Net loss | (32,551) | (26,212) | (6,339) | ||||||||||||||
| Less: Net loss attributable to non-controlling interest in consolidated subsidiaries | (13,679) | (11,084) | (2,595) | ||||||||||||||
| Net loss attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (18,872) | $ | (15,128) | $ | (3,744) | |||||||||||
39
The following table sets forth a reconciliation of net loss attributable to stockholders to Adjusted EBITDA, before series B preferred stock dividend and loss on extinguishment of preferred stock to Adjusted EBITDA:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Net loss attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (18,872) | $ | (15,128) | $ | (3,744) | |||||||||||
| Add: Provision for income taxes | 212 | 423 | (211) | ||||||||||||||
| Add: Equity-based compensation expense | 7,253 | 508 | 6,745 | ||||||||||||||
| Add: Acquisition and transaction expenses | — | (1) | 1 | ||||||||||||||
| Add: Losses on the modification or extinguishment of debt and capital lease obligations | 6,429 | 7 | 6,422 | ||||||||||||||
| Add: Changes in fair value of non-hedge derivative instruments | — | — | — | ||||||||||||||
| Add: Asset impairment charges | — | — | — | ||||||||||||||
| Add: Incentive allocations | — | — | — | ||||||||||||||
Add: Depreciation and amortization expense (1) | 13,220 | 12,473 | 747 | ||||||||||||||
| Add: Interest expense | 16,235 | 16,624 | (389) | ||||||||||||||
| Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities | — | — | — | ||||||||||||||
| Add: Dividends and accretion of redeemable preferred stock | — | — | — | ||||||||||||||
| Add: Interest and other costs on pension and OPEB liabilities | — | — | — | ||||||||||||||
Add: Other non-recurring items | — | — | — | ||||||||||||||
| Less: Equity in earnings of unconsolidated entities | — | — | — | ||||||||||||||
Less: Non-controlling share of Adjusted EBITDA (2) | (10,040) | (6,956) | (3,084) | ||||||||||||||
| Adjusted EBITDA (Non-GAAP) | $ | 14,437 | $ | 7,950 | $ | 6,487 | |||||||||||
________________________________________________________
(1) Includes the following items for the three months ended March 31, 2026 and 2025: (i) depreciation and amortization expense of $11,987 and $11,240 and (ii) capitalized contract costs amortization of $1,233 and $1,233, respectively.
(2) Includes the following items for the three months ended March 31, 2026 and 2025: (i) equity-based compensation expense of $1,679 and $118, (ii) provision for income taxes of $49 and $98, (iii) interest expense of $3,761 and $3,849, (iv) depreciation and amortization expense of $3,062 and $2,889 and (v) losses on the modification or extinguishment of debt of $1,489 and $2, respectively.
Revenues
Total revenues increased $7.9 million during the three months ended March 31, 2026 due to an increase in average crude product throughput volumes.
Expenses
Total expenses increased $8.5 million during the three months ended March 31, 2026, which primarily reflects:
•an increase in operating expenses of $7.7 million primarily due to costs associated with stock-based compensation and costs associated with increased terminal throughput activity; and
•an increase in depreciation and amortization of $0.7 million due to additional assets being placed into service.
Other (expense) income
Total other expense increased $6.0 million during the three months ended March 31, 2026, which primarily reflects an increase in loss on modification or extinguishment of debt of $6.4 million related to a current quarter loss on extinguishment of the June 2025 Jefferson Credit Agreement.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA increased $6.5 million during the three months ended March 31, 2026 primarily due to the changes noted above.
40
Repauno Segment
The following table presents our results of operations:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Revenues | |||||||||||||||||
| Terminal services revenues | $ | 1,208 | $ | 3,810 | $ | (2,602) | |||||||||||
| Other revenue | — | 1 | (1) | ||||||||||||||
| Total revenues | 1,208 | 3,811 | (2,603) | ||||||||||||||
| Expenses | |||||||||||||||||
| Operating expenses | 6,306 | 6,666 | (360) | ||||||||||||||
| Acquisition and transaction expenses | — | 316 | (316) | ||||||||||||||
| Depreciation and amortization | 2,583 | 2,496 | 87 | ||||||||||||||
| Total expenses | 8,889 | 9,478 | (589) | ||||||||||||||
| Other (expense) income | |||||||||||||||||
| Interest expense | (1,951) | (1,518) | (433) | ||||||||||||||
| Other income | 1,076 | — | 1,076 | ||||||||||||||
| Total other expense | (875) | (1,518) | 643 | ||||||||||||||
| Loss before income taxes | (8,556) | (7,185) | (1,371) | ||||||||||||||
| Provision for income taxes | — | 12 | (12) | ||||||||||||||
| Net loss | (8,556) | (7,197) | (1,359) | ||||||||||||||
| Less: Net loss attributable to non-controlling interest in consolidated subsidiaries | (391) | (404) | 13 | ||||||||||||||
| Net loss attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (8,165) | $ | (6,793) | $ | (1,372) | |||||||||||
41
The following table sets forth a reconciliation of net loss attributable to stockholders to Adjusted EBITDA, before series B preferred stock dividend and loss on extinguishment of preferred stock to Adjusted EBITDA:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Net loss attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (8,165) | $ | (6,793) | $ | (1,372) | |||||||||||
| Add: Provision for income taxes | — | 12 | (12) | ||||||||||||||
| Add: Equity-based compensation expense | 1,592 | 302 | 1,290 | ||||||||||||||
| Add: Acquisition and transaction expenses | — | 316 | (316) | ||||||||||||||
| Add: Losses on the modification or extinguishment of debt and capital lease obligations | — | — | — | ||||||||||||||
| Add: Changes in fair value of non-hedge derivative instruments | — | — | — | ||||||||||||||
| Add: Asset impairment charges | — | — | — | ||||||||||||||
| Add: Incentive allocations | — | — | — | ||||||||||||||
| Add: Depreciation and amortization expense | 2,583 | 2,496 | 87 | ||||||||||||||
| Add: Interest expense | 1,951 | 1,518 | 433 | ||||||||||||||
| Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities | — | — | — | ||||||||||||||
| Add: Dividends and accretion of redeemable preferred stock | — | — | — | ||||||||||||||
| Add: Interest and other costs on pension and OPEB liabilities | — | — | — | ||||||||||||||
Add: Other non-recurring items (1) | — | 1,035 | (1,035) | ||||||||||||||
| Less: Equity in earnings of unconsolidated entities | — | — | — | ||||||||||||||
Less: Non-controlling share of Adjusted EBITDA (2) | (282) | (338) | 56 | ||||||||||||||
| Adjusted EBITDA (non-GAAP) | $ | (2,321) | $ | (1,452) | $ | (869) | |||||||||||
________________________________________________________
(1) Includes the following items for the three months ended March 31, 2025: (i) incidental utility rebillings of $650 and (ii) loss on inventory heel of $385.
(2) Includes the following items for the three months ended March 31, 2026 and 2025: (i) equity-based compensation expense of $73 and $18, (ii) provision for income taxes of $— and $1, (iii) interest expense of $90 and $90, (iv) depreciation and amortization expense of $119 and $149, (v) asset impairment charges of $— and $19 and (vi) other non-recurring items of $— and $61, respectively.
Revenues
Total revenues decreased $2.6 million during the three months ended March 31, 2026 primarily due to lower volumes stemming from the terminal’s current butane contract compared to the prior period contract that ended in March 2025.
Other (expense) income
Total other expense decreased $0.6 million during the three months ended March 31, 2026, which primarily reflects an increase in other income of $1.1 million from the interest on the Series 2025 Bond funds, partially offset by an increase in interest expense of $0.4 million related to additional borrowings under the Series 2025 Bonds and DRP DB Term Loan in May 2025.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA decreased $0.9 million during the three months ended March 31, 2026 primarily due to the changes noted above.
42
Power and Gas Segment
The following table presents our results of operations:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Revenues | |||||||||||||||||
| Terminal services revenues | $ | 422 | $ | 326 | $ | 96 | |||||||||||
| Power revenues | 45,628 | 15,780 | 29,848 | ||||||||||||||
| Gas revenues | 15,956 | 1,188 | 14,768 | ||||||||||||||
| Total revenues | 62,006 | 17,294 | 44,712 | ||||||||||||||
| Expenses | |||||||||||||||||
| Operating expenses | 27,775 | 6,311 | 21,464 | ||||||||||||||
| Acquisition and transaction expenses | 801 | 1,069 | (268) | ||||||||||||||
| Depreciation and amortization | 16,376 | 6,090 | 10,286 | ||||||||||||||
| Total expenses | 44,952 | 13,470 | 31,482 | ||||||||||||||
| Other income (expense) | |||||||||||||||||
| Equity in earnings of unconsolidated entities | — | 10,588 | (10,588) | ||||||||||||||
| (Loss) gain on sale of assets, net | (573) | 119,952 | (120,525) | ||||||||||||||
| Interest expense | (23,666) | (9,017) | (14,649) | ||||||||||||||
| Other income | 1,968 | 2,240 | (272) | ||||||||||||||
| Total other (expense) income | (22,271) | 123,763 | (146,034) | ||||||||||||||
| Income (loss) before income taxes | (5,217) | 127,587 | (132,804) | ||||||||||||||
| Benefit from income taxes | — | (42,457) | 42,457 | ||||||||||||||
| Net income (loss) | (5,217) | 170,044 | (175,261) | ||||||||||||||
| Less: Net loss attributable to non-controlling interest in consolidated subsidiaries | (46) | — | (46) | ||||||||||||||
| Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (5,171) | $ | 170,044 | $ | (175,215) | |||||||||||
43
The following table sets forth a reconciliation of net (loss) income attributable to stockholders to Adjusted EBITDA, before series B preferred stock dividend and loss on extinguishment of preferred stock to Adjusted EBITDA:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Net (loss) income attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (5,171) | $ | 170,044 | $ | (175,215) | |||||||||||
| Add: Benefit from income taxes | — | (42,457) | 42,457 | ||||||||||||||
| Add: Equity-based compensation expense | 1,583 | — | 1,583 | ||||||||||||||
| Add: Acquisition and transaction expenses | 801 | 1,069 | (268) | ||||||||||||||
| Add: Losses on the modification or extinguishment of debt and capital lease obligations | — | — | — | ||||||||||||||
| Add: Changes in fair value of non-hedge derivative instruments | (348) | — | (348) | ||||||||||||||
| Add: Asset impairment charges | — | — | — | ||||||||||||||
| Add: Incentive allocations | — | — | — | ||||||||||||||
Add: Depreciation and amortization expense (1) | 6,140 | 4,502 | 1,638 | ||||||||||||||
| Add: Interest expense | 23,666 | 9,017 | 14,649 | ||||||||||||||
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (2) | — | 6,503 | (6,503) | ||||||||||||||
| Add: Dividends and accretion of redeemable preferred stock | — | — | — | ||||||||||||||
| Add: Interest and other costs on pension and OPEB liabilities | — | — | — | ||||||||||||||
| Add: Other non-recurring items | — | — | — | ||||||||||||||
| Less: Equity in earnings of unconsolidated entities | — | (10,588) | 10,588 | ||||||||||||||
Less: Non-controlling share of Adjusted EBITDA (3) | (260) | — | (260) | ||||||||||||||
| Adjusted EBITDA (non-GAAP) | $ | 26,411 | $ | 138,090 | $ | (111,679) | |||||||||||
________________________________________________________
(1) Includes the following items for the three months ended March 31, 2026 and 2025: (i) depreciation and amortization expense of $16,376 and $6,090 and (ii) amortization of other comprehensive income of $(10,236) and $(1,588), respectively.
(2) Includes the following items for the three months ended March 31, 2026 and 2025: (i) net income of $— and $10,576, (ii) interest expense of $— and $6,352, (iii) depreciation and amortization expense of $— and $2,185, (iv) acquisition and transaction expenses of $— and $201, (v) changes in fair value of non-hedge derivative instruments of $— and $(12,822), (vi) equity method basis adjustments of $— and $10 and (vii) other non-recurring items of $— and $1, respectively.
(3) Includes the following items for the three months ended March 31, 2026 and 2025: (i) equity-based compensation expense of $13 and $—, (ii) interest expense of $194 and $—, (iii) depreciation and amortization expense of $50 and $—, (iv) acquisition and transaction expenses of $7 and $— and (v) changes in fair value of non-hedge derivative instruments of $(4) and $—, respectively.
Revenues
Total revenues increased $44.7 million during the three months ended March 31, 2026 primarily due to an increase in power plant revenue as well as an increase in gas revenues as a result of the acquisition of 100% of Long Ridge in February 2025.
Expenses
Total expenses increased $31.5 million during the three months ended March 31, 2026, which primarily reflects:
•an increase in operating expenses of $21.5 million primarily related to increased Ohio GasCo LLC and Long Ridge West Virginia LLC well operations, increased legal expenses and full inclusion of operating expenses after the acquisition of 100% of Long Ridge in February 2025; and
•an increase in depreciation and amortization expense of $10.3 million related to depreciation expense at the Terminal and Power Plant businesses as a result of the acquisition of 100% of Long Ridge during February 2025.
Other income (expense)
Total other expense increased $146.0 million during the three months ended March 31, 2026, which reflects:
•an increase in interest expense of $14.6 million related to interest expense on the Long Ridge debt that is now consolidated;
•a decrease in gain on sale of assets, net of $120.5 million due to a gain recognized in the prior year on the acquisition of 100% of Long Ridge in February 2025; and
•a decrease in equity in earnings of unconsolidated entities of $10.6 million primarily due to the equity pickup of Long Ridge Energy & Power LLC net earnings in the prior year that were not recognized in the current quarter since 100% of
44
Long Ridge Energy & Power LLC was acquired in February 2025, and therefore no equity pickup was recorded after the acquisition.
Benefit from income taxes
Benefit from income taxes decreased $42.5 million during the three months ended March 31, 2026 primarily due to the partial release of the valuation allowance in connection with the acquisition of Long Ridge Energy & Power LLC in February 2025.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA decreased $111.7 million during the three months ended March 31, 2026 primarily due to the changes noted above.
Sustainability and Energy Transition Segment
The following table presents our results of operations:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Revenues | |||||||||||||||||
| Other revenue | $ | — | $ | — | $ | — | |||||||||||
| Total revenues | — | — | — | ||||||||||||||
| Other (expense) income | |||||||||||||||||
| Equity in losses of unconsolidated entities | (518) | (5,324) | 4,806 | ||||||||||||||
| Other income | 737 | 339 | 398 | ||||||||||||||
| Total other income (expense) | 219 | (4,985) | 5,204 | ||||||||||||||
| Net income (loss) attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | 219 | $ | (4,985) | $ | 5,204 | |||||||||||
The following table sets forth a reconciliation of net income (loss) attributable to stockholders to Adjusted EBITDA, before series B preferred stock dividend and loss on extinguishment of preferred stock to Adjusted EBITDA:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Net income (loss) attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | 219 | $ | (4,985) | $ | 5,204 | |||||||||||
| Add: Provision for income taxes | — | — | — | ||||||||||||||
| Add: Equity-based compensation expense | — | — | — | ||||||||||||||
| Add: Acquisition and transaction expenses | — | — | — | ||||||||||||||
| Add: Losses on the modification or extinguishment of debt and capital lease obligations | — | — | — | ||||||||||||||
| Add: Changes in fair value of non-hedge derivative instruments | — | — | — | ||||||||||||||
| Add: Asset impairment charges | — | — | — | ||||||||||||||
| Add: Incentive allocations | — | — | — | ||||||||||||||
| Add: Depreciation and amortization expense | — | — | — | ||||||||||||||
| Add: Interest expense | — | — | — | ||||||||||||||
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities(1) | (518) | (1,965) | 1,447 | ||||||||||||||
| Add: Dividends and accretion of redeemable preferred stock | — | — | — | ||||||||||||||
| Add: Interest and other costs on pension and OPEB liabilities | — | — | — | ||||||||||||||
| Add: Other non-recurring items | — | — | — | ||||||||||||||
| Less: Equity in losses of unconsolidated entities | 518 | 5,324 | (4,806) | ||||||||||||||
| Less: Non-controlling share of Adjusted EBITDA | — | — | — | ||||||||||||||
| Adjusted EBITDA (Non-GAAP) | $ | 219 | $ | (1,626) | $ | 1,845 | |||||||||||
________________________________________________________
(1) Includes the following items for the three months ended March 31, 2026 and 2025: (i) net loss of $(518) and $(3,948), (ii) interest expense of $— and $1,284 and (iii) depreciation and amortization expense of $— and $699, respectively.
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Other (expense) income
Total other income increased $5.2 million during the three months ended March 31, 2026, which reflects changes in equity in losses of unconsolidated entities primarily due to lower operating losses at GM-FTAI Holdco LLC.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA increased $1.8 million during the three months ended March 31, 2026 primarily due to the changes noted above.
Corporate and Other
The following table presents our results of operations:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Revenues | |||||||||||||||||
| Rail revenues | $ | 270 | $ | — | $ | 270 | |||||||||||
| Roadside services revenues | 12,554 | 12,976 | (422) | ||||||||||||||
| Total revenues | 12,824 | 12,976 | (152) | ||||||||||||||
| Expenses | |||||||||||||||||
| Operating expenses | 13,736 | 13,035 | 701 | ||||||||||||||
| General and administrative | 3,554 | 5,113 | (1,559) | ||||||||||||||
| Acquisition and transaction expenses | 4,411 | 2,038 | 2,373 | ||||||||||||||
| Management fees and incentive allocation to affiliate | 4,092 | 2,542 | 1,550 | ||||||||||||||
| Depreciation and amortization | 258 | 100 | 158 | ||||||||||||||
| Total expenses | 26,051 | 22,828 | 3,223 | ||||||||||||||
| Other income (expense) | |||||||||||||||||
| Equity in earnings of unconsolidated entities | — | 50 | (50) | ||||||||||||||
| Loss on modification or extinguishment of debt | (39,485) | — | (39,485) | ||||||||||||||
| Interest expense | (39,136) | (15,814) | (23,322) | ||||||||||||||
| Other income | (1,090) | — | (1,090) | ||||||||||||||
| Total other expense | (79,711) | (15,764) | (63,947) | ||||||||||||||
| Loss before income taxes | (92,938) | (25,616) | (67,322) | ||||||||||||||
| Provision for (benefit from) income taxes | 13 | (304) | 317 | ||||||||||||||
| Net loss | (92,951) | (25,312) | (67,639) | ||||||||||||||
| Less: Net income attributable to non-controlling interest in consolidated subsidiaries | 18 | — | 18 | ||||||||||||||
| Less: Dividends and accretion of redeemable preferred stock | — | 21,841 | (21,841) | ||||||||||||||
| Net loss attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (92,969) | $ | (47,153) | $ | (45,816) | |||||||||||
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The following table sets forth a reconciliation of net loss attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock to Adjusted EBITDA:
| Three Months Ended March 31, | Change | ||||||||||||||||
| (in thousands) | 2026 | 2025 | |||||||||||||||
| Net loss attributable to stockholders, before series B preferred stock dividend and loss on extinguishment of preferred stock | $ | (92,969) | $ | (47,153) | $ | (45,816) | |||||||||||
| Add: Provision for (benefit from) income taxes | 13 | (304) | 317 | ||||||||||||||
| Add: Equity-based compensation expense | 103 | 85 | 18 | ||||||||||||||
| Add: Acquisition and transaction expenses | 4,411 | 2,038 | 2,373 | ||||||||||||||
| Add: Losses on the modification or extinguishment of debt and capital lease obligations | 39,485 | — | 39,485 | ||||||||||||||
| Add: Changes in fair value of non-hedge derivative instruments | — | — | — | ||||||||||||||
| Add: Asset impairment charges | — | — | — | ||||||||||||||
| Add: Incentive allocations | — | — | — | ||||||||||||||
| Add: Depreciation and amortization expense | 258 | 100 | 158 | ||||||||||||||
| Add: Interest expense | 39,136 | 15,814 | 23,322 | ||||||||||||||
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (1) | — | (38) | 38 | ||||||||||||||
| Add: Dividends and accretion of redeemable preferred stock | — | 21,841 | (21,841) | ||||||||||||||
| Add: Interest and other costs on pension and OPEB liabilities | — | — | — | ||||||||||||||
Add: Other non-recurring items (2) | 1,190 | — | 1,190 | ||||||||||||||
| Less: Equity in earnings of unconsolidated entities | — | (50) | 50 | ||||||||||||||
Less: Non-controlling share of Adjusted EBITDA (3) | (14) | — | (14) | ||||||||||||||
| Adjusted EBITDA (Non-GAAP) | $ | (8,387) | $ | (7,667) | $ | (720) | |||||||||||
________________________________________________________
(1) Includes the following items for the three months ended March 31, 2026 and 2025: (i) net loss of $— and $(50) and (ii) interest expense of $— and $12, respectively.
(2) Includes the following items for the three months ended March 31, 2026: unrealized loss on investment of $1,190.
(3) Includes the following items for the three months ended March 31, 2026 and 2025: (i) equity-based compensation expense of $5 and $—, (ii) provision for income taxes of $1 and $— and (iii) depreciation and amortization expense of $8 and $—, respectively.
Expenses
Total expenses increased $3.2 million during the three months ended March 31, 2026, which primarily reflects an increase in acquisition and transaction expenses of $2.4 million primarily due to costs incurred with debt refinancing activities and professional fees related to the Wheeling acquisition.
Other income (expense)
Total other expense increased $63.9 million during the three months ended March 31, 2026 primarily due to (i) loss on extinguishment of the Bridge Loan Credit Agreement during the current quarter and (ii) an increase in interest expense due to additional borrowings under the Term Loan Credit Agreement during the quarter.
Adjusted EBITDA (Non-GAAP)
Adjusted EBITDA decreased $0.7 million during the three months ended March 31, 2026 primarily due to the changes noted above.
Liquidity and Capital Resources
We believe we have sufficient liquidity to satisfy our cash needs; however, we continue to evaluate and take action, as necessary, to preserve adequate liquidity and ensure that our business can continue to operate during these uncertain times. This includes limiting discretionary spending across the organization and re-prioritizing our capital projects.
During the quarter, we have (i) refinanced the Bridge Loan Credit Agreement with the Term Loan Credit Agreement (see Note 7 for additional details), (ii) paid down the Jefferson June 2025 Credit Agreement and (iii) entered into a binding Commitment Agreement (the “Backstop Agreement”) dated March 16, 2026, pursuant to which we may, at our sole option, on or prior to July 1, 2026, elect to borrow from a lender funds in an aggregate principal amount of $255.0 million pursuant to a bridge facility that will have a maturity date which is 364 days after the close of such bridge facility (see Note 7 for additional details). However, the Company has significant remaining debt obligations, which it continues to actively manage. The planned sale of Long Ridge will further improve the Company’s liquidity position and reduce our total debt (see Note 18 for additional details). Management’s
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planned actions, including the sale of Long Ridge, are considered probable to be implemented and to provide sufficient liquidity for the Company to meet its obligations as they become due over the twelve months from the date the financial statements were issued.
Our principal uses of liquidity have been and continue to be (i) acquisitions of and investments in infrastructure assets, (ii) expenses associated with our operating activities and (iii) debt service obligations associated with our investments.
•Cash used for investing activities was $44.8 million and $164.3 million during the three months ended March 31, 2026 and 2025, respectively.
•Uses of liquidity associated with our operating and interest expenses are captured on a net basis in our cash flows from operating activities. Uses of liquidity associated with our debt obligations are captured in our cash flows from financing activities.
Our principal sources of liquidity to fund these uses have been and continue to be (i) cash and restricted cash on hand as of March 31, 2026, (ii) revenues from our infrastructure business net of operating expenses, (iii) proceeds from borrowings and (iv) opportunistic sales of assets or investments.
•Cash flows used in operating activities were $69.4 million and $85.7 million during the three months ended March 31, 2026 and 2025, respectively.
•During the three months ended March 31, 2026, additional borrowings were obtained in connection with the Term Loan Credit Agreement of $1.35 billion. In February 2026, we used a portion of the net proceeds from the Term Loan Credit Agreement to repay the Bridge Loan Credit Agreement of $1.25 million. In March 2026, we also used a portion of the net proceeds from the Term Loan Credit Agreement to repay the June 2025 Jefferson Credit Agreement of $30.0 million.
We are currently evaluating several potential transactions and related financings, including, but not limited to, providing for increased debt capacity at certain of our subsidiaries, which could occur within the next 12 months. None of these transactions, negotiations or financings are definitive or included within our planned liquidity needs. We cannot assure if or when any such transaction will be consummated or the terms of any such transaction. In addition, from time to time, we may seek to repay, refinance or restructure all or a portion of our debt or to repurchase or repay our outstanding debt through, as applicable, tender offers, exchange offers, open market purchases, privately negotiated transactions or otherwise. Such transactions, if any, will depend on a number of factors, including prevailing market conditions, our liquidity requirements and contractual requirements (including compliance with the terms of our debt agreements), among other factors. Our restricted cash and cash equivalents are available to finance construction projects, as well as meet debt service obligations.
Historical Cash Flow
Comparison of the three months ended March 31, 2026 and 2025
The following table compares the historical cash flow for the three months ended March 31, 2026 and 2025:
| Three Months Ended March 31, | |||||||||||
| (in thousands) | 2026 | 2025 | |||||||||
| Cash Flow Data: | |||||||||||
| Net cash used in operating activities | $ | (69,377) | $ | (85,651) | |||||||
| Net cash (used in) provided by investing activities | (44,755) | 164,299 | |||||||||
| Net cash provided by (used in) financing activities | 15,617 | (2,537) | |||||||||
Net cash used in operating activities decreased $16.3 million, which primarily reflects certain adjustments to reconcile net loss to cash used in operating activities including (i) an increase in equity in losses of unconsolidated entities of $5.8 million, (ii) changes in working capital of $7.4 million, (iii) a decrease in gain on sale of subsidiaries of $120.0 million, (iv) changes in deferred income taxes of $43.4 million, (v) an increase in depreciation and amortization of $25.7 million, (vi) an increase in loss on modification or extinguishment of debt of $45.9 million, (vii) an increase in amortization of bond discount of $10.3 million, (viii) an increase in amortization of deferred financing costs of $1.0 million and (ix) an increase in equity-based compensation of $9.7 million, partially offset by (i) an increase in amortization of other comprehensive income of $8.6 million and (ii) an increase in net loss of $247.4 million.
Net cash used in investing activities increased $209.1 million, primarily due to (i) a decrease in the acquisition of business of $226.6 million and (ii) a decrease in proceeds from investor loan of $11.0 million, partially offset by (i) an increase in proceeds from the sale of property, plant and equipment of $8.8 million and (ii) a decrease in the acquisition of property, plant and equipment of $20.1 million.
Net cash provided by financing activities increased $18.2 million, primarily due to (i) a decrease in the payment of cash dividends on preferred stock of $25.5 million, (ii) an increase in proceeds from debt of $1.3 billion and (iii) an increase in proceeds from financing obligation of $50.0 million, partially offset by (i) an increase in repayment of debt of $1.3 billion, (ii) an increase in payment of financing costs of $10.3 million, (iii) an increase in cash dividends paid for redeemable preferred stock - NCI of $5.0 million and (iv) an increase in settlement of equity-based compensation of $2.3 million.
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Debt Obligations
Refer to Note 7 of the consolidated financial statements for additional information.
Contractual Obligations
Our material cash requirements include the following contractual and other obligations:
Debt Obligations—As of March 31, 2026, we had outstanding principal and interest payment obligations of $3.9 billion and $1.4 billion, respectively, of which, there are $25.4 million of principal payments due and $302.5 million of interest payments due within the next twelve months. As of March 31, 2026, we had $37.1 million of unused borrowing capacity. See Note 7 to the consolidated financial statements for additional information about our debt obligations.
Lease Obligations—As of March 31, 2026, we had outstanding operating and finance lease obligations of $366.3 million, of which $16.6 million is due within the next twelve months.
Redeemable Preferred Stock Obligations—We have dividend payments of $135.5 million due on our redeemable preferred stock within the next twelve months with an option to paid-in-kind dividends at a higher interest rate and to defer payment. See Note 15 for additional information related to our preferred stock obligations.
Other Cash Requirements—In addition to our contractual obligations, we may pay quarterly cash dividends on our common stock, which are subject to change at the discretion of our board of directors.
We expect to meet our future short-term liquidity requirements through cash on hand, unused borrowing capacity or future financings and net cash provided by our current operations. We expect that our operating subsidiaries will generate sufficient cash flow to cover operating expenses and the payment of principal and interest on our indebtedness as they become due. We may elect to meet certain long-term liquidity requirements or to continue to pursue strategic opportunities through utilizing cash on hand, cash generated from our current operations and the issuance of securities in the future. Management believes adequate capital and borrowings are available from various sources to fund our commitments to the extent required. See Note 1 for additional information related to other cash requirements.
Critical Accounting Estimates and Policies
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, FYX and Long Ridge Energy & Power LLC. As of December 31, 2025, the carrying amount of goodwill within the Jefferson Terminal, Railroad, Corporate and Other and Power and Gas segments was $122.7 million, $147.2 million, $5.4 million and $90.3 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, 2025, 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 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. The fair value estimate was sensitive to certain assumptions inherent in the discounted estimated cash flows, including forecasted revenue and revenue growth rates and discount rates. 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 20% as of October 1, 2025. 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. Our discount rate for our 2025 goodwill impairment analysis was 10% and our assumed
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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 grow and 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 was no impairment of goodwill for the year ended December 31, 2025.
Recent Accounting Pronouncements
The Company has reviewed recently issued accounting pronouncements and concluded that such pronouncements are either not applicable to the Company or no material impact is expected in the consolidated financial statements as a result of future adoption.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Market risk represents the risk of changes in value of a financial instrument, caused by fluctuations in interest rates and foreign exchange rates. Changes in these factors could cause fluctuations in our results of operations and cash flows. We are exposed to the market risks described below.
Interest Rate Risk
Interest rate risk is the exposure to loss resulting from changes in the level of interest rates and the spread between different interest rates. Interest rate risk is highly sensitive to many factors, including the U.S. government's monetary and tax policies, global economic factors and other factors beyond our control. We are exposed to changes in the level of interest rates and to changes in the relationship or spread between interest rates. Our primary interest rate exposure relates to our term loan arrangements.
Indices which are deemed “benchmarks” are the subject of recent national, international, and other regulatory guidance and proposals for reform. We are monitoring related reform proposals and evaluating the related risks; however, it is not possible to predict the effects of any of these developments, and any future initiatives to regulate, reform or change the manner of administration of benchmark indices could result in adverse consequences to the rate of interest payable and receivable on, market value of and market liquidity for financial instruments tied to variable interest rate indices.
Some of our borrowing agreements require payments based on a variable interest rate index, such as Secured Overnight Financing Rate. Therefore, to the extent our borrowing costs are not fixed, increases in interest rates may reduce our net income by increasing the cost of our debt without any corresponding increase in rents or cash flow from our leases. We may elect to manage our exposure to interest rate movements through the use of interest rate derivatives (interest rate swaps and caps).
The following discussion about the potential effects of changes in interest rates is based on a sensitivity analysis, which models the effects of hypothetical interest rate shifts on our financial condition and results of operations. Although we believe a sensitivity analysis provides the most meaningful analysis permitted by the rules and regulations of the SEC, it is constrained by several factors, including the necessity to conduct the analysis based on a single point in time and by the inability to include the extraordinarily complex market reactions that normally would arise from the market shifts modeled. Although the following results of a sensitivity analysis for changes in interest rates may have some limited use as a benchmark, they should not be viewed as a forecast. This forward-looking disclosure also is selective in nature and addresses only the potential interest expense impacts on our financial instruments. It also does not include a variety of other potential factors that could affect our business as a result of changes in interest rates.
As of March 31, 2026, assuming we do not hedge our exposure to interest rate fluctuations related to our outstanding floating rate debt, a hypothetical 100-basis point increase/decrease in our variable interest rate on our borrowings would result in an increase of approximately $4.5 million or a decrease of approximately $4.5 million in interest expense over the next 12 months.
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Item 4. Controls and Procedures
Disclosure Controls and Procedures
As of the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of and for the period covered by this report.
Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II—OTHER INFORMATION
Item 1. Legal Proceedings
We are and may become involved in legal proceedings, including but not limited to regulatory investigations and inquiries, in the ordinary course of our business. Although we are unable to predict with certainty the eventual outcome of any litigation, regulatory investigation or inquiry, in the opinion of management, we do not expect our current and any threatened legal proceedings to have a material adverse effect on our business, financial position or results of operations. Given the inherent unpredictability of these types of proceedings, however, it is possible that future adverse outcomes could have a material adverse effect on our financial results.
Item 1A. Risk Factors
You should carefully consider the following risks and other information in this Form 10-Q in evaluating us and our common stock. Any of the following risks, as well as additional risks and uncertainties not currently known to us or that we currently deem immaterial, could materially and adversely affect our results of operations or financial condition. The risk factors generally have been separated into the following groups: risks related to our business, risks related to our capital structure, risks related to our Manager, risks related to the spin-off, risks related to the Wheeling acquisition and risks related to our common stock. However, these categories do overlap and should not be considered exclusive.
Risks Related to Our Business
We have limited operating history as an independent company and may not be able to successfully operate our business strategy, generate sufficient revenue to make or sustain distributions to our stockholders or meet our contractual commitments.
We have limited experience operating as an independent company and cannot assure you that we will be able to successfully operate our business or implement our operating policies and strategies as described in this report. The timing, terms, price and form of consideration that we pay in future transactions may vary meaningfully from prior transactions.
As an independent public company, there can be no assurance that we will be able to generate sufficient returns to pay our operating expenses and make or sustain distributions to our stockholders, or any distributions at all, or meet our contractual commitments. Our results of operations, ability to make or sustain distributions to our stockholders or meet our contractual commitments depend on several factors, including the availability of opportunities to acquire attractive assets, the level and volatility of interest rates, the availability of adequate short- and long-term financing, the financial markets and economic conditions.
Uncertainty relating to macroeconomic conditions may reduce the demand for our assets, limit our ability to obtain additional capital to finance new investments or refinance existing debt, or have other unforeseen negative effects.
Uncertainty and negative trends in general economic conditions in the United States and abroad, including significant tightening of credit markets and commodity price volatility, have created in the past and may continue to create difficult operating environments for owners and operators in the infrastructure industry. Many factors, including factors that are beyond our control, may impact our operating results or financial condition. For some years, the world has experienced weakened economic conditions and volatility following adverse changes in global capital markets. Volatility in oil and gas markets can put significant upward or downward pressure on prices for these commodities, and may affect demand for assets used in production, refining and transportation of oil and gas. Additionally, the worldwide military or geopolitical environment, including the Russia-Ukraine conflict and the conflicts in the Middle East, including the war among Israel, America and Iran and the related closure and blockade of the Strait of Hormuz, and any related geopolitical or economic responses, U.S. federal government shutdowns, global macroeconomic effects of trade disputes and increased tariffs, such as those imposed, or that may be imposed, by the U.S., may put further upward or downward pressure on prices for such commodities. In the past, a significant decline in oil prices has led to lower production and transportation budgets worldwide. These conditions have resulted in significant contraction, deleveraging and reduced liquidity in the credit markets. A number of governments have implemented, or are considering implementing, a broad variety of governmental actions or new regulations for the financial markets. In addition, limitations on the availability of capital, higher costs of capital for financing expenditures or the desire to preserve liquidity, may cause our current or prospective customers to make reductions in future capital budgets and spending.
The industries in which we operate have experienced periods of oversupply during which asset values have declined, particularly during the most recent economic downturn, and any future oversupply could materially adversely affect our results of operations and cash flows.
The oversupply of a specific asset is likely to depress the value of our assets and result in decreased utilization of our assets, and the industries in which we operate have experienced periods of oversupply during which asset values have declined, particularly during the most recent economic downturn. Factors that could lead to such oversupply include, without limitation:
•general demand for the type of assets that we purchase;
•general macroeconomic conditions, including market prices for commodities that our assets may serve;
•geopolitical events, including war, prolonged armed conflict and acts of terrorism;
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•outbreaks of communicable diseases and natural disasters;
•governmental regulation or economic, trade or other policies, including as a result of changing trade policies and tariffs, including related uncertainty or the imposition of modified or additional tariffs, trade wars, barriers or restrictions, or threats of such actions;
•interest rates;
•the availability of credit;
•restructurings and bankruptcies of companies in the industries in which we operate, including our customers;
•manufacturer production levels and technological innovation;
•manufacturers merging or exiting the industry or ceasing to produce certain asset types;
•retirement and obsolescence of the assets that we own;
•increases in supply levels of assets in the market due to the sale or merging of our customers; and
•reintroduction of previously unused or dormant assets into the industries in which we operate.
These and other related factors are generally outside of our control and could lead to persistence of, or increase in, the oversupply of the types of assets that we acquire or decreased utilization of our assets, either of which could materially adversely affect our results of operations and cash flows.
There can be no assurance that any target returns will be achieved.
Our target returns for assets are targets only and are not forecasts of future profits. We develop target returns based on our Manager’s assessment of appropriate expectations for returns on assets and the ability of our Manager to enhance the return generated by those assets through active management. There can be no assurance that these assessments and expectations will be achieved and failure to achieve any or all of them may materially adversely impact our ability to achieve any target return with respect to any or all of our assets.
In addition, our target returns are based on estimates and assumptions regarding a number of other factors, including, without limitation, holding periods, the absence of material adverse events affecting specific investments (which could include, without limitation, natural disasters, terrorism, social unrest or civil disturbances), general and local economic and market conditions, changes in law, taxation, regulation or governmental policies and changes in the geopolitical approach to infrastructure investment, either generally or in specific countries in which we may invest or seek to invest. Many of these factors, as well as the other risks described elsewhere in this report, are beyond our control and all could adversely affect our ability to achieve a target return with respect to an asset. Further, target returns are targets for the return generated by specific assets and not by us. Numerous factors could prevent us from achieving similar returns, notwithstanding the performance of individual assets, including, without limitation, taxation and fees payable by us or our operating subsidiaries, including fees and incentive allocation payable to our Manager.
There can be no assurance that the returns generated by any of our assets will meet our target returns, or any other level of return, or that we will achieve or successfully implement our asset acquisition objectives, and failure to achieve the target return in respect of any of our assets could, among other things, have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows. Further, even if the returns generated by individual assets meet target returns, there can be no assurance that the returns generated by other existing or future assets would do so, and the historical performance of the assets in our existing portfolio should not be considered as indicative of future results with respect to any assets.
Contractual defaults may adversely affect our business, prospects, financial condition, results of operations and cash flows by decreasing revenues and increasing storage, positioning, collection, recovery and lost equipment expenses.
The success of our business depends in large part on the success of the operators in the sectors in which we participate. Cash flows from our assets are substantially impacted by our ability to collect compensation and other amounts to be paid in respect of such assets from the customers with whom we enter into contractual arrangements. Inherent in the nature of the arrangements for the use of such assets is the risk that we may not receive, or may experience delay in realizing, such amounts to be paid. While we target the entry into contracts with credit-worthy counterparties, no assurance can be given that such counterparties will perform their obligations during the term of the contractual arrangement. In addition, when counterparties default, we may fail to recover all of our assets, and the assets we do recover may be returned in damaged condition or to locations where we will not be able to efficiently use or sell them.
If we acquire a high concentration of a particular type of asset, or concentrate our investments in a particular sector, our business, prospects, financial condition, results of operations and cash flows could be adversely affected by changes in market demand or problems specific to that asset or sector.
If we acquire a high concentration of a particular asset, or concentrate our investments in a particular sector, our business and financial results could be adversely affected by sector-specific or asset-specific factors. Furthermore, as a result of the spin-off transaction, our assets are focused on infrastructure and we do not have any interest in FTAI’s aviation assets, which limits the
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diversity of our portfolio. Any decrease in the value and rates of our assets may have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows.
We may not generate a sufficient amount of cash or generate sufficient free cash flow to fund our operations or repay our and our subsidiaries’ indebtedness and preferred stock.
Our ability to make payments on our and our subsidiaries’ indebtedness and preferred stock as required depends on our and our subsidiaries’ ability to generate cash flow in the future. This ability, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control. If we or our subsidiaries do not generate sufficient free cash flow to satisfy our or our subsidiaries’ debt or preferred stock obligations, including interest payments and the payment of principal at maturity, we may have to undertake alternative financing plans, such as refinancing or restructuring our debt, selling assets, reducing or delaying capital investments or seeking to raise additional capital. We cannot provide assurance that any refinancing would be possible, that any assets could be sold, or, if sold, of the timeliness and amount of proceeds realized from those sales, that additional financing could be obtained on acceptable terms, if at all, or that additional financing would be permitted under the terms of our various debt or preferred stock instruments then in effect. Furthermore, our ability to refinance would depend upon the condition of the finance and credit markets. Our inability to generate sufficient free cash flow to satisfy our and our subsidiaries’ debt and preferred stock obligations, or to refinance our and our subsidiaries’ obligations on commercially reasonable terms or on a timely basis, would materially affect our business, financial condition and results of operations.
We operate in highly competitive markets.
The business of acquiring infrastructure assets is highly competitive. Market competition for opportunities includes traditional infrastructure companies, commercial and investment banks, as well as a growing number of non-traditional participants, such as hedge funds, private equity funds and other private investors, including Fortress-related entities. Some of these competitors may have access to greater amounts of capital and/or to capital that may be committed for longer periods of time or may have different return thresholds than us, and thus these competitors may have certain advantages not shared by us. In addition, competitors may have incurred, or may in the future incur, leverage to finance their debt investments at levels or on terms more favorable than those available to us. Strong competition for investment opportunities could result in fewer such opportunities for us, as certain of these competitors have established and are establishing investment vehicles that target the same types of assets that we intend to purchase.
In addition, some of our competitors may have longer operating histories, greater financial resources and lower costs of capital than us, and consequently, may be able to compete more effectively in one or more of our target markets. We likely will not always be able to compete successfully with our competitors and competitive pressures or other factors may also result in significant price competition, particularly during industry downturns, which could have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows.
The values of our assets may fluctuate due to various factors.
The fair market values of our assets may decrease or increase depending on a number of factors, including general economic and market conditions affecting our target markets, type and age of assets, supply and demand for assets, competition, new governmental or other regulations and technological advances, all of which could impact our profitability and our ability to develop, operate, or sell such assets. In addition, our assets depreciate as they age and may generate lower revenues and cash flows. We must be able to replace such older, depreciated assets with newer assets, or our ability to maintain or increase our revenues and cash flows will decline. In addition, if we dispose of an asset for a price that is less than the depreciated book value of the asset on our balance sheet or if we determine that an asset’s value has been impaired, we will recognize a related charge in our Consolidated Statements of Operations and such charge could be material.
We may acquire operating businesses, including businesses whose operations are not fully matured and stabilized. These businesses may be subject to significant operating and development risks, including increased competition, cost overruns and delays, and difficulties in obtaining approvals or financing. These factors could materially affect our business, financial condition, liquidity and results of operations.
We received in the spin-off, and may in the future acquire, operating businesses, including businesses whose operations are not fully matured and stabilized (including, but not limited to, our businesses within the Railroad, Jefferson Terminal, Repauno, Power and Gas, and Sustainability and Energy Transition segments). While our Manager has deep experience in the construction and operation of these companies, we are nevertheless subject to significant risks and contingencies of an operating business, and these risks are greater where the operations of such businesses are not fully matured and stabilized. Key factors that may affect our operating businesses include, but are not limited to:
•competition from market participants;
•general economic and/or industry trends, including pricing for the products or services offered by our operating businesses;
•the issuance and/or continued availability of necessary permits, licenses, approvals and agreements from governmental agencies and third parties as are required to construct and operate such businesses;
•changes or deficiencies in the design or construction of development projects;
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•unforeseen engineering, environmental or geological problems;
•potential increases in construction and operating costs due to changes in the cost and availability of fuel, power, materials and supplies;
•the availability and cost of skilled labor and equipment;
•our ability to enter into additional satisfactory agreements with contractors and to maintain good relationships with these contractors in order to construct development projects within our expected cost parameters and time frame, and the ability of those contractors to perform their obligations under the contracts and to maintain their creditworthiness;
•potential liability for injury or casualty losses which are not covered by insurance;
•potential opposition from non-governmental organizations, environmental groups, local or other groups which may delay or prevent development activities;
•local and economic conditions;
•recent geopolitical events;
•changes in legal requirements; and
•force majeure events, including catastrophes and adverse weather conditions.
Any of these factors could materially affect our business, financial condition, liquidity and results of operations.
Our use of joint ventures or partnerships, and our Manager’s outsourcing of certain functions, may present unforeseen obstacles or costs.
We received in the spin-off, and may in the future acquire, interests in certain assets in cooperation with third-party partners or co-investors through jointly owned acquisition vehicles, joint ventures or other structures. In these co-investment situations, our ability to control the management of such assets depends upon the nature and terms of the joint arrangements with such partners and our relative ownership stake in the asset, each of which will be determined by negotiation at the time of the investment and the determination of which is subject to the discretion of our Manager. Depending on our Manager’s perception of the relative risks and rewards of a particular asset, our Manager may elect to acquire interests in structures that afford relatively little or no operational and/or management control to us. Such arrangements present risks not present with wholly owned assets, such as the possibility that a co-investor becomes bankrupt, develops business interests or goals that conflict with our interests and goals in respect of the assets, all of which could materially adversely affect our business, prospects, financial condition, results of operations and cash flows.
In addition, our Manager expects to utilize third-party contractors to perform services and functions related to the operation of our assets. These functions may include billing, collections, recovery and asset monitoring. Because we and our Manager do not directly control these third parties, there can be no assurance that the services they provide will be delivered at a level commensurate with our expectations, or at all. The failure of any such third-party contractors to perform in accordance with our expectations could materially adversely affect our business, prospects, financial condition, results of operations and cash flows.
We are subject to the risks and costs of obsolescence of our assets.
Technological and other improvements expose us to the risk that certain of our assets may become technologically or commercially obsolete. If we are not able to acquire new technology or are unable to implement new technology, we may suffer a competitive disadvantage. For example, as the freight transportation markets we serve continue to evolve and become more efficient, the use of certain locomotives or railcars may decline in favor of other more economic modes of transportation. If the technology we use in our lines of business is superseded, or the cost of replacing our locomotives or railcars is expensive and requires additional capital, we could experience significant cost increases and reduced availability of the assets and equipment that are necessary for our operations. Any of these risks may adversely affect our ability to sell our assets on favorable terms, if at all, which could materially adversely affect our operating results and growth prospects.
The North American rail sector is a highly regulated industry and increased costs of compliance with, or liability for violation of, existing or future laws, regulations and other requirements could significantly increase our operational costs of doing business, thereby adversely affecting our profitability.
The rail sector is subject to extensive laws, regulations and other requirements, including, but not limited to, those relating to the environment, safety, rates and charges, service obligations, employment, labor, immigration, minimum wages and overtime pay, health care and benefits, working conditions, public accessibility and other requirements. These laws and regulations are enforced by U.S. federal agencies, including the U.S. Environmental Protection Agency (the “U.S. EPA”), the U.S. Department of Transportation (the “DOT”), the Occupational Safety and Health Act (the “OSHA”), the U.S. Federal Railroad Administration (the “FRA”), and the U.S. Surface Transportation Board (the “STB”), as well as numerous other state, provincial, local and federal agencies. Ongoing compliance with, or a violation of, these laws, regulations and other requirements could have a material adverse effect on our business, financial condition and results of operations.
We believe that our rail operations are, and have been, in substantial compliance with applicable laws and regulations. However, these laws and regulations, and the interpretation or enforcement thereof, are subject to frequent change and varying interpretation by regulatory authorities, and we are unable to predict the ongoing cost to us of complying with these laws and
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regulations or the future impact of these laws and regulations on our operations. In addition, from time to time we are subject to inspections and investigations by various regulators. Violation of environmental or other laws, regulations and permits can result in the imposition of significant administrative, civil and criminal penalties, injunctions and construction bans or delays.
Legislation passed by the U.S. Congress or Canadian Parliament or new regulations issued by federal agencies can significantly affect the revenues, costs and profitability of our business. For instance, the STB’s recent proposal to modify its policy regarding forced reciprocal switching by rail carriers or other competitive access proposals, if adopted, could increase government involvement in railroad pricing, service and operations and significantly change the current federal regulatory framework of the railroad industry. Such changes could have a significant negative impact on the Company’s ability to determine prices for rail services, meet service standards and could force a reduction in capital spending. Statutes imposing price constraints or affecting rail-to-rail competition could adversely affect the Company’s profitability.
Under various U.S. federal, state, provincial and local environmental requirements, as the owner or operator of terminals or other facilities, we may be liable for the costs of removal or remediation of contamination at or from our existing locations, whether we knew of, or were responsible for, the presence of such contamination. The failure to timely report and properly remediate contamination may subject us to liability to third parties and may adversely affect our ability to sell or rent our property or to borrow money using our property as collateral. Additionally, we may be liable for the costs of remediating third-party sites where hazardous substances from our operations have been transported for treatment or disposal, regardless of whether we own or operate that site. In the future, we may incur substantial expenditures for investigation or remediation of contamination that has not yet been discovered at our current or former locations or locations that we may acquire.
A discharge of hydrocarbons or hazardous substances into the environment associated with operating our rail assets could subject us to substantial expense, including the cost to recover the materials spilled, restore the affected natural resources, pay fines and penalties, and natural resource damages and claims made by employees, neighboring landowners, government authorities and other third parties, including for personal injury and property damage. We may experience future catastrophic sudden or gradual releases into the environment from our trains or facilities or discover historical releases that were previously unidentified or not assessed. Although our inspection and testing programs are designed to prevent, detect and address any such releases promptly, the liabilities resulting from any future releases into the environment from our assets have the potential to substantially affect our business. Such events could also subject us to media and public scrutiny that could have a negative effect on our operations and also on the value of our common stock.
Our business could be adversely affected if service on the railroads is interrupted or if more stringent regulations are adopted regarding railcar design or the transportation of crude oil by rail.
As a result of hydraulic fracturing and other improvements in extraction technologies, there has been a substantial increase in the volume of crude oil and liquid hydrocarbons produced and transported in North America, and a geographic shift in that production versus historical production. The increase in volume and shift in geography has resulted in increased pipeline congestion and a corresponding growth in crude oil being transported by rail from Canada and across the U.S. High-profile accidents involving crude-oil-carrying trains in Quebec, North Dakota and Virginia, and more recently in Saskatchewan, West Virginia and Illinois, have raised concerns about derailments and the environmental and safety risks associated with crude oil transport by rail and the associated risks arising from railcar design. In Canada, the transport of hazardous products is receiving greater scrutiny, which could impact our customers and our business.
Our business is subject to evolving regulations regarding railcar design and the transportation of hazardous materials. Following the 2023 East Palestine derailment, authorities have accelerated safety mandates, including the final transition to DOT-117 tank cars. As of May 2025, legacy CPC-1232 cars owned by Jefferson Terminal are largely prohibited from crude and ethanol service, with a final deadline of May 1, 2029, for all other flammable liquids.
To mitigate the costs of retrofitting our fleet of railcars at Jefferson and the risks of stricter operational controls, we are increasingly focusing our business development on customers and commodities that do not involve the movement of hazardous materials. Despite this shift, any additional federal or provincial mandates—such as real-time reporting requirements or speed restrictions—could still increase compliance costs. Furthermore, railroad service disruptions due to labor disputes, mechanical failures, or extreme weather could adversely affect our operations and financial results.
The adoption of additional federal, state, provincial or local laws or regulations, including any voluntary measures by the rail industry regarding railcar design or crude oil and liquid hydrocarbon rail transport activities, or efforts by local communities to restrict or limit rail traffic involving crude oil, could affect our business by increasing compliance costs and decreasing demand for our services, which could adversely affect our financial position and cash flows. Moreover, any disruptions in the operations of railroads, including those due to shortages of railcars, weather-related problems, flooding, drought, accidents, mechanical difficulties, strikes, lockouts or bottlenecks, could adversely impact our customers’ ability to move their product and, as a result, could affect our business.
We could be negatively impacted by environmental, social, and governance (“ESG”) and sustainability-related matters.
Governments, investors, customers, employees and other stakeholders are increasingly focusing on corporate ESG practices and disclosures, and expectations in this area continue to evolve. In addition, ESG laws and regulations are expanding mandatory disclosure, reporting and diligence requirements. We have announced, and may in the future announce, sustainability-focused investments, partnerships and other initiatives and goals. These initiatives, aspirations, targets or objectives reflect our current plans and aspirations and are not guarantees that we will be able to achieve them. Our efforts to
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accomplish and accurately report on these initiatives and goals present numerous operational, regulatory, reputational, financial, legal, and other risks, any of which could have a material negative impact, including on our reputation and stock price.
In addition, the standards for tracking and reporting on ESG matters are relatively new, have not been harmonized and continue to evolve. Our selection of disclosure frameworks that seek to align with various voluntary reporting standards may change from time to time and may result in a lack of comparative data from period to period. Moreover, our processes and controls may not always align with evolving voluntary standards for identifying, measuring, and reporting ESG metrics, our interpretation of reporting standards may differ from those of others, and such standards may change over time, any of which could result in significant revisions to our goals or reported progress in achieving such goals. In this regard, the criteria by which our ESG practices and disclosures are assessed may change due to the quickly evolving landscape, which could result in greater expectations of us and cause us to undertake costly initiatives to satisfy such new criteria. The increasing attention to corporate ESG initiatives could also result in increased investigations and litigation or threats thereof. If we are unable to satisfy such new criteria, investors may conclude that our ESG and sustainability practices are inadequate. On the other hand, state attorneys general and other governmental authorities may take action against certain ESG policies or practices, and we may become subject to restrictions on ESG initiatives. If we fail or are perceived to have failed to achieve previously announced initiatives or goals, accurately disclose our progress on such initiatives or goals or comply with various ESG and anti-ESG practices and regulations, our reputation, business, financial condition and results of operations could be adversely impacted.
We transport hazardous materials.
We transport certain hazardous materials and other materials, including crude oil, ethanol, and toxic inhalation hazard (“TIH”) materials, such as chlorine, that pose certain risks in the event of a release or combustion. Additionally, U.S. laws impose common carrier obligations on railroads that require us to transport certain hazardous materials regardless of risk or potential exposure to loss. In addition, insurance premiums charged for, or the self-insured retention associated with, some or all of the coverage currently maintained by us could increase dramatically or certain coverage may not be available to us in the future if there is a catastrophic event related to rail transportation of these materials. A rail accident or other incident or accident on our network, at our facilities, or at the facilities of our customers involving the release or combustion of hazardous materials could involve significant costs and claims for personal injury, property damage, and environmental penalties and remediation in excess of our insurance coverage for these risks, which could have a material adverse effect on our results of operations, financial condition, and liquidity.
We may be affected by fluctuating prices for fuel and energy.
Volatility in energy prices could have a significant effect on a variety of items, including, but not limited to: the economy; demand for transportation services; business related to the energy sector, including the production and processing of crude oil, natural gas, and coal; fuel prices; and fuel surcharges. Particularly in our rail business, fuel costs constitute a significant portion of our expenses. Diesel fuel prices and availability can be subject to dramatic fluctuations, and significant price increases could have a material adverse effect on our operating results. If a severe fuel supply shortage arose from production curtailments, disruption of oil imports or domestic oil production, disruption of domestic refinery production, damage to refinery or pipeline infrastructure, political unrest, war, terrorist attack or otherwise, diesel fuel may not be readily available and may be subject to rationing regulations. Currently, we receive fuel surcharges and other rate adjustments to offset fuel prices, although there may be a significant delay in our recovery of fuel costs based on the terms of the fuel surcharge program. If Class I railroads change their policies regarding fuel surcharges, the compensation we receive for increases in fuel costs may decrease, which could have a negative effect on our profitability; in fact, we cannot be certain that we will always be able to mitigate rising or elevated fuel costs through fuel surcharges at all, as future market conditions or legislative or regulatory activities could adversely affect our ability to apply fuel surcharges or adequately recover increased fuel costs through fuel surcharges.
International, political, and economic factors, events and conditions and the potential for worsening economic conditions or economic downturn, including as a result of recent geopolitical events, including the war among Israel, America and Iran and the related closure and blockade of the Strait of Hormuz, and changing trade policies and tariffs, including related uncertainty or the imposition of modified or additional tariffs, trade wars, barriers or restrictions, or threats of such actions, may affect the volatility of fuel prices and supplies. Weather can also affect fuel supplies and limit domestic refining capacity. A severe shortage of, or disruption to, domestic fuel supplies could have a material adverse effect on our results of operations, financial condition, and liquidity. In addition, lower fuel prices could have a negative impact on commodities we process and transport, such as crude oil and petroleum products, which could have a material adverse effect on our results of operations, financial condition, and liquidity.
Because we depend on Class I railroads for a significant portion of our operations in North America, our results of operations, financial condition and liquidity may be adversely affected if our relationships with these carriers deteriorate.
The railroad industry in the United States and Canada is dominated by six Class I carriers that have substantial market control and negotiating leverage. In addition, Class I carriers also traditionally have been significant sources of business for us, and may be future sources of potential acquisition candidates as they divest branch lines. A decision by any of these Class I carriers to cease or re-route certain freight movements or to alter existing business relationships, including operational or relationship changes, could have a material adverse effect on our results of operations. The overall impact of any such decision would depend on which Class I carrier is involved, the routes and freight movements affected, as well as the nature of any changes.
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The Railroad segment faces competition from other railroads and other transportation providers.
The Railroad segment faces competition from other railroads, motor carriers, ships, barges, and pipelines. We operate in some corridors served by other railroads and motor carriers. In addition to price competition, we face competition with respect to transit times, quality, and reliability of service from motor carriers and other railroads. Motor carriers in particular can have an advantage over railroads with respect to transit times and timeliness of service. However, railroads are much more fuel-efficient than trucks, which reduces the impact of transporting goods on the environment and public infrastructure. Additionally, we must build or acquire and maintain our rail system, while trucks, barges, and maritime operators are able to use public rights-of-way maintained by public entities. Any of the following could also affect the competitiveness of our rail services, which could have a material adverse effect on our results of operations, financial condition, and liquidity: (i) improvements or expenditures materially increasing the quality or reducing the costs of these alternative modes of transportation, such as autonomous or more fuel efficient trucks, (ii) legislation that eliminates or significantly increases the size or weight limitations applied to motor carriers, or (iii) legislation or regulatory changes that impose operating restrictions on railroads or that adversely affect the profitability of some or all railroad traffic. Additionally, any future consolidation of the rail industry could materially affect our competitive environment.
Our assets are exposed to unplanned interruptions caused by events outside of our control which may disrupt our business and cause damage or losses that may not be adequately covered by insurance.
The operations of infrastructure projects are exposed to unplanned interruptions caused by breakdown or failure of equipment or plants, aging infrastructure, employee error or contractor or subcontractor failure, problems that delay or increase the cost of returning facilities to service after outages, limitations that may be imposed by equipment conditions or environmental, safety or other regulatory requirements, fuel supply or fuel transportation reductions or interruptions, labor disputes, difficulties with the implementation or operation of information systems, derailments, power outages, pipeline or electricity line ruptures and catastrophic events, such as hurricanes, cyclones, earthquakes, landslides, floods, explosions, fires or other disasters. Any equipment or system outage or constraint can, among other things, reduce sales, increase costs and affect the ability to meet regulatory service metrics, customer expectations and regulatory reliability and security requirements. We have in the past experienced power outages at plants which disrupted their operations and negatively impacted our revenues. We cannot assure you that similar events may not occur in the future. Operational disruption, as well as supply disruption, and increased government oversight could adversely impact the cash flows available from these assets. In addition, the cost of repairing or replacing damaged assets could be considerable. Repeated or prolonged interruption may result in temporary or permanent loss of customers, substantial litigation or penalties for regulatory or contractual non-compliance, and any loss from such events may not be recoverable under relevant insurance policies. Although we believe that we are adequately insured against these types of events, no assurance can be given that the occurrence of any such event will not materially adversely affect us.
We are actively evaluating potential acquisitions of assets and operating companies in other infrastructure sectors which could result in additional risks and uncertainties for our business and unexpected regulatory compliance costs.
While our existing portfolio consists of assets in the energy, port and rail sectors, we are actively evaluating potential acquisitions of assets and operating companies in other infrastructure sectors and we plan to be flexible as other attractive opportunities arise over time. To the extent we make acquisitions in other sectors, we will face numerous risks and uncertainties, including risks associated with the required investment of capital and other resources and with combining or integrating operational and management systems and controls. Entry into certain lines of business may subject us to new laws and regulations and may lead to increased litigation and regulatory risk. Many types of infrastructure assets, including certain rail and seaport assets, are subject to registration requirements by U.S. governmental agencies, as well as foreign governments if such assets are to be used outside of the United States. Failing to register the assets, or losing such registration, could result in substantial penalties, forced liquidation of the assets and/or the inability to operate and, if applicable, lease the assets. We may need to incur significant costs to comply with the laws and regulations applicable to any such new acquisition. The failure to comply with these laws and regulations could cause us to incur significant costs, fines or penalties or require the assets to be removed from service for a period of time resulting in reduced income from these assets. In addition, if our acquisitions in other sectors produce insufficient revenues, or produce investment losses, or if we are unable to efficiently manage our expanded operations, our results of operations will be adversely affected, and our reputation and business may be harmed.
Restrictive covenants in our and our subsidiaries’ debt and preferred stock instruments may adversely affect us.
The instruments governing our and our subsidiaries’ outstanding debt and preferred stock contain certain restrictive covenants that limit our ability to engage in activities that may be in our long-term best interests. For example, these covenants significantly restrict our and certain of our subsidiaries’ ability to:
•incur indebtedness;
•issue equity interests of the Company ranking pari passu with, or senior in priority to, our Series B Redeemable Convertible Preferred Stock;
•issue equity interests of any subsidiary of the Company;
•pay dividends or make other distributions;
•repurchase or redeem capital stock or subordinated indebtedness and make investments;
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•create liens;
•incur dividend or other payment restrictions affecting the Company and certain of its subsidiaries;
•transfer or sell assets, including capital stock of subsidiaries;
•merge or consolidate with other entities or transfer all or substantially all of the Company’s assets;
•take actions to cause the Company to cease to be treated as a domestic C corporation for U.S. tax purposes;
•consummate a change in control without concurrently redeeming the Series A Preferred Stock - RailCo and the Series A Warrants - RailCo;
•amend, terminate or permit the assignment or subcontract of, or the transfer of any rights or obligations under, the Management Agreement, in order to alter the (i) scope of services in any material respect, (ii) the compensation, fee payment or other economic terms relating to the Management Agreement, or (iii) the scope of matters expressly required to be approved by the Independent Directors (as such term is defined in the Management Agreement) pursuant to the Management Agreement;
•engage in certain intercompany transactions;
•engage in certain prohibited business activities; and
•enter into transactions with affiliates.
While these covenants are subject to a number of important exceptions and qualifications, such restrictive covenants could affect our ability to operate our business and may limit our ability to take advantage of potential business opportunities. Events beyond our control can affect our ability to comply with these covenants. If an event of default occurs, we cannot assure you that we would have sufficient assets to repay all of our obligations.
In addition, certain other debt instruments (including the Series 2020A Bonds, Series 2021 Bonds and Series 2024 Bonds, the EB-5 loan agreements, the Long Ridge Acquiom Loan, the RailCo Revolver and the June 2025 Jefferson Credit Agreement) and the Series A Preferred Stock - RailCo and the Series A Warrants - RailCo include restrictive covenants that may materially limit our, or our subsidiaries’, ability to repay other debt or require us to achieve and maintain compliance with specified financial ratios. See “Description of Indebtedness” in the Information Statement filed with the SEC on Form 8-K on July 15, 2022 and Exhibits 10.11, 10.14 and 10.15 included herein.
The degree to which we are leveraged could cause a material adverse effect on our business, financial condition, results of operations and cash flows.
We are responsible for servicing our own debt and obtaining and maintaining sufficient working capital and other funds to satisfy our cash requirements. Our access to and cost of debt financing is different from the historical access to and cost of debt financing under FTAI. Differences in access to and cost of debt financing may result in differences in the interest rates charged to us on financings, as well as the amount of indebtedness, types of financing structures and debt markets that may be available to us. Our ability to make payments on and to refinance our and our subsidiaries’ indebtedness and preferred stock, as well as any future debt and preferred stock that we or our subsidiaries may incur, will depend on our ability to generate cash in the future from operations, financings and/or asset sales. Our ability to generate cash is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.
Terrorist attacks or other hostilities could negatively impact our operations and our profitability and may expose us to liability and reputational damage.
Terrorist attacks may negatively affect our operations. Such attacks have contributed to economic instability in the United States and elsewhere, and further acts of terrorism, violence or war, including recent geopolitical events, could similarly affect world trade and the industries in which we and our customers operate. In addition, terrorist attacks or hostilities may directly impact locations where our trains and containers travel or our physical facilities or those of our customers. In addition, it is also possible that our assets could be involved in a terrorist attack or other hostilities. The consequences of any terrorist attacks or hostilities are unpredictable, and we may not be able to foresee events that could have a material adverse effect on our operations.
Our inability to obtain sufficient capital would constrain our ability to grow our portfolio and to increase our revenues.
Our business is capital intensive, and we have used and may continue to employ leverage to finance our operations. Accordingly, our ability to successfully execute our business strategy and maintain our operations depends on the availability and cost of debt and equity capital. Additionally, our ability to borrow against our assets is dependent, in part, on the appraised value of such assets. If the appraised value of such assets declines, we may be required to reduce the principal outstanding under our debt facilities or otherwise be unable to incur new borrowings.
We can give no assurance that the capital we need will be available to us on favorable terms, or at all. Our inability to obtain sufficient capital, or to renew or expand our credit facilities, could result in increased funding costs and would limit our ability to:
•meet the terms and maturities of our existing and future debt facilities;
•purchase new assets or refinance existing assets;
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•fund our working capital needs and maintain adequate liquidity; and
•finance other growth initiatives.
In addition, we conduct our operations so that neither we nor any of our subsidiaries are required to register as an investment company under the Investment Company Act of 1940 (the “Investment Company Act”). As such, certain forms of financing such as finance leases may not be available to us. Please see “—If we are deemed an investment company under the Investment Company Act, it could have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows.”
The effects of various environmental regulations may negatively affect the industries in which we operate which could have a material adverse effect on our financial condition, results of operations and cash flows.
We are subject to federal, state and local laws and regulations relating to the protection of the environment, including those governing the discharge of pollutants to air and water, the management and disposal of hazardous substances and wastes, the cleanup of contaminated sites and noise and emission levels and greenhouse gas emissions. Under some environmental laws in the United States, strict liability may be imposed on the owners or operators of assets, which could render us liable for environmental and natural resource damages without regard to negligence or fault on our part. In addition, changes to environmental standards or regulations in the industries in which we operate could limit the economic life of the assets we acquire or reduce their value, and also require us to make significant additional investments in order to maintain compliance, which would negatively impact our results of operations and financial condition. In addition, a variety of new legislation is being enacted, or considered for enactment, at the federal, state and local levels relating to greenhouse gas emissions and climate change. While there has historically been a lack of consistent climate change legislation, as climate change concerns continue to grow, further legislation and regulations are expected to continue in areas such as greenhouse gas emissions control, emission disclosure requirements and building codes or other infrastructure requirements that impose energy efficiency standards. Government mandates, standards or regulations intended to mitigate or reduce greenhouse gas emissions or projected climate change impacts could result in prohibitions or severe restrictions on infrastructure development in certain areas, increased energy and transportation costs, and increased compliance expenses and other financial obligations to meet permitting or development requirements that we may be unable to fully recover (due to market conditions or other factors), any of which could result in reduced profits and adversely affect our results of operations. While we typically maintain liability insurance coverage, the insurance coverage is subject to large deductibles, limits on maximum coverage and significant exclusions and may not be sufficient or available to protect against any or all liabilities and such indemnities may not cover or be sufficient to protect us against losses arising from environmental damage. In addition, changes to environmental standards or regulations in the industries in which we operate could limit the economic life of the assets we acquire or reduce their value, and also require us to make significant additional investments in order to maintain compliance, which would negatively impact our cash flows and results of operations.
Our Repauno site and the Long Ridge property are subject to environmental laws and regulations that may expose us to significant costs and liabilities.
Our Repauno site is subject to ongoing environmental investigation and remediation by the former owner that sold Repauno to FTAI (the “Repauno Seller”) related to historic industrial operations. The Repauno Seller is responsible for completion of this work, and we benefit from a related indemnity and insurance policy. If the Repauno Seller fails to fulfill its investigation and remediation, or indemnity obligations and the related insurance, which are subject to limits and conditions, fail to cover our costs, we could incur losses. Redevelopment of the property in those areas undergoing investigation and remediation must await state environmental agency confirmation that no further investigation or remediation is required before redevelopment activities can occur in such areas of the property. Therefore, any delay in the Repauno Seller’s completion of the environmental work or receipt of related approvals in an area of the property could delay our redevelopment activities. In addition, once received, permits and approvals may be subject to litigation, and projects may be delayed or approvals reversed or modified in litigation. If there is a delay in obtaining any required regulatory approval, it could delay projects and cause us to incur costs.
In addition, a portion of the Long Ridge site was redeveloped as a combined cycle gas-fired electric generating facility, and other portions will likely be redeveloped in the future. Although we have not identified material impacts to soils or groundwater that reasonably would be expected to prevent or delay further redevelopment projects, impacted materials could be encountered that require special handling and/or result in delays to those projects. Any additional projects may require environmental permits and approvals from federal, state and local environmental agencies. Once received, permits and approvals may be subject to litigation, and projects may be delayed or approvals reversed or modified in litigation. If there is a delay in obtaining any required regulatory approval, it could delay projects and cause us to incur costs.
Moreover, new, stricter environmental laws, regulations or enforcement policies, including those imposed in response to climate change, could be implemented that significantly increase our compliance costs, or require us to adopt more costly methods of operation. If we are not able to transform the Repauno or Long Ridge sites into hubs for industrial and energy development in a timely manner, their future prospects could be materially and adversely affected, which may have a material adverse effect on our business, operating results and financial condition.
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We have material customer concentration with respect to the Jefferson Terminal and Railroad segments, with a limited number of customers accounting for a material portion of our revenues.
We earned approximately 22% of total revenues for the three months ended March 31, 2026 from one customer in the Railroad segment. Additionally, we earned approximately 7% of total revenues for the three months ended March 31, 2026 from one customer in the Jefferson Terminal segment. We earned approximately 41% of total revenues for the three months ended March 31, 2025 from one customer in the Railroad segment. Additionally, we earned approximately 11% of total revenues for the three months ended March 31, 2025, from one customer in the Jefferson Terminal segment. As of March 31, 2026, accounts receivable from three customers within the Jefferson Terminal, Railroad and Corporate and Other segments represented 43% of total accounts receivable, net. As of December 31, 2025, accounts receivable from three customers within the Jefferson Terminal and Railroad segments represented 41% of total accounts receivable, net.
There are inherent risks whenever a large percentage of total revenues are concentrated with a limited number of customers. It is not possible for us to predict the future level of demand for our services that will be generated by these customers or the future demand for the products and services of these customers in the end-user marketplace. In addition, revenues from these customers may fluctuate from time to time based on the commencement and completion of projects, the timing of which may be affected by market conditions or other factors, some of which may be outside of our control. If any of these customers experience declining or delayed sales due to market, economic or competitive conditions, or undergo material management or ownership changes, we could be pressured to reduce the prices we charge for our services or we could lose a major customer. Any such development could have an adverse effect on our margins and financial position and would negatively affect our revenues and results of operations and/or trading price of our common stock.
A cyberattack that bypasses our information technology (“IT”) security systems or the IT security systems of our third-party providers, causing an IT security breach or cybersecurity incident, may lead to a disruption of our IT systems and the loss of business information which may hinder our ability to conduct our business effectively and may result in lost revenues and additional costs.
Parts of our business depend on the secure operation of our IT systems and the IT systems of our third-party providers to manage, process, store, and transmit information. We have, from time to time, experienced cybersecurity threats to our data and systems, including malware and computer virus attacks, any of which could be enhanced or facilitated by artificial intelligence. A cyberattack that bypasses our IT security systems or the IT security systems of our third-party providers, causing an IT security breach or cybersecurity incident, could adversely impact our daily operations and lead to the loss of sensitive information, including our own proprietary information and that of our customers, suppliers and employees. Such losses could harm our reputation and result in competitive disadvantages, litigation, regulatory enforcement actions, lost revenues, additional costs and liabilities. While we devote substantial resources to maintaining adequate levels of cyber-security, our resources and technical sophistication may not be adequate to prevent all types of cyberattacks or incidents.
If we are deemed an “investment company” under the Investment Company Act, it could have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows.
We conduct our operations so that neither we nor any of our subsidiaries are required to register as an investment company under the Investment Company Act. Section 3(a)(1)(A) of the Investment Company Act defines an investment company as any issuer that is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities. Section 3(a)(1)(C) of the Investment Company Act defines an investment company as any issuer that is engaged or proposes to engage in the business of investing, reinvesting, owning, holding or trading in securities and owns or proposes to acquire investment securities having a value exceeding 40% of the value of the issuer’s total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. Excluded from the term “investment securities,” among other things, are U.S. government securities and securities issued by entities which are at least 50% owned that are not themselves investment companies and are not relying on the exception from the definition of investment company for certain privately offered investment vehicles set forth in Section 3(c)(1) or Section 3(c)(7) of the Investment Company Act.
The Investment Company Act may limit our and our subsidiaries’ ability to enter into financing leases and engage in other types of financial activity because less than 40% of the value of our and our subsidiaries’ total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis can consist of “investment securities.”
If we or any of our subsidiaries were required to register as an investment company under the Investment Company Act, the registered entity would become subject to substantial regulation that would significantly change our operations, and we would not be able to conduct our business as described in this report. We have not obtained a formal determination from the SEC as to our status under the Investment Company Act and, consequently, any violation of the Investment Company Act would subject us to material adverse consequences.
Adverse judgments or settlements in legal proceedings could materially harm our business, financial condition, operating results and cash flows.
We may be party to claims that arise from time to time in the ordinary course of our business, which may include those related to, for example, contracts, sub-contracts, employment of our workforce and immigration requirements or compliance with any of a wide array of state and federal statutes, rules and regulations that pertain to different aspects of our business. We may also be required to initiate expensive litigation or other proceedings to protect our business interests. There is a risk that we will not be successful or otherwise be able to satisfactorily resolve any pending or future litigation. In addition, litigation and other legal
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claims are subject to inherent uncertainties and management’s view of currently pending legal matters may change in the future. Those uncertainties include, but are not limited to, litigation costs and attorneys’ fees, unpredictable judicial or jury decisions and the differing laws regarding damage awards among the states in which we operate. Unexpected outcomes in such legal proceedings, or changes in management’s evaluation or predictions of the likely outcomes of such proceedings (possibly resulting in changes in established reserves), could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Risks Related to Our Manager
We are dependent on our Manager and other key personnel at Fortress and may not find suitable replacements if our Manager terminates the Management Agreement or if other key personnel depart.
Our officers and other individuals who perform services for us (other than Jefferson Terminal, Repauno, Long Ridge, Transtar, Aleon and Gladieux, Wheeling, KRS, Clean Planet, FYX, and CarbonFree employees) are employees of our Manager or other Fortress entities. We are completely reliant on our Manager, which has significant discretion as to the implementation of our operating policies and strategies, to conduct our business. We are subject to the risk that our Manager will terminate the Management Agreement and that we will not be able to find a suitable replacement for our Manager in a timely manner, at a reasonable cost, or at all. Furthermore, we are dependent on the services of certain key employees of our Manager and certain key employees of Fortress entities whose compensation is partially or entirely dependent upon the amount of management fees earned by our Manager and whose continued service is not guaranteed, and the loss of such personnel or services could materially adversely affect our operations. We do not have key man insurance for any of the personnel of the Manager or other Fortress entities that are key to us. An inability to find a suitable replacement for any departing employee of our Manager or Fortress entities on a timely basis could materially adversely affect our ability to operate and grow our business.
In addition, our Manager may assign our Management Agreement to an entity whose business and operations are managed or supervised by Mr. Wesley R. Edens, who is an employee of Fortress, which is an affiliate of our Manager, and who until May 2024, was a principal and a member of the board of directors of Fortress and a member of the management committee of Fortress since co-founding Fortress in May 1998. In the event of any such assignment to a non-affiliate of Fortress, the functions currently performed by our Manager’s current personnel may be performed by others. We can give you no assurance that such personnel would manage our operations in the same manner as our Manager currently does, and the failure by the personnel of any such entity to acquire assets generating attractive risk-adjusted returns could have a material adverse effect on our business, financial condition, results of operations and cash flows.
On May 14, 2024, certain members of Fortress management and affiliates of Mubadala completed their acquisition of 100% of the equity of Fortress. While Fortress’s senior investment professionals are expected to remain at Fortress, including those individuals who perform services for us, there can be no assurance that the transaction will not have an adverse impact on us or our relationship with our Manager.
There are conflicts of interest in our relationship with our Manager.
Our Management Agreement was not negotiated at arm’s-length, and its terms, including fees payable, may not be as favorable to us as if they had been negotiated with an unaffiliated third party.
There are conflicts of interest inherent in our relationship with our Manager insofar as our Manager and its affiliates—including investment funds, private investment funds, or businesses managed by our Manager, including Florida East Coast Industries, LLC (“FECI”)—invest in transportation and transportation-related infrastructure assets and whose investment objectives overlap with our asset acquisition objectives. Certain opportunities appropriate for us may also be appropriate for one or more of these other investment vehicles. Certain members of our board of directors and employees of our Manager who are our officers also serve as officers and/or directors of these other entities. Although we have the same Manager, we may compete with entities affiliated with our Manager or Fortress, including FECI, for certain target assets. From time to time, entities affiliated with or managed by our Manager or Fortress may focus on investments in assets with a similar profile as our target assets that we may seek to acquire. These affiliates may have meaningful purchasing capacity, which may change over time depending upon a variety of factors, including, but not limited to, available equity capital and debt financing, market conditions and cash on hand. Fortress has multiple existing and planned funds focused on investing in one or more of our target sectors, each with significant current or expected capital commitments. In connection with the spin-off, we received assets previously purchased by FTAI, and we may in the future purchase assets from these funds, and FTAI has previously co-invested and we may in the future co-invest with these funds in infrastructure assets. Fortress funds generally have a fee structure similar to ours, but the fees actually paid will vary depending on the size, terms and performance of each fund.
Our Management Agreement generally does not limit or restrict our Manager or its affiliates from engaging in any business or managing other pooled investment vehicles that invest in assets that meet our asset acquisition objectives. Our Manager intends to engage in additional infrastructure related management and other investment opportunities in the future, which may compete with us for investments or result in a change in our current investment strategy. In addition, our certificate of incorporation provides that if any of the Fortress Parties or any of their officers, directors or employees acquire knowledge of a potential transaction that could be a corporate opportunity, they have no duty, to the fullest extent permitted by law, to offer such corporate opportunity to us, our stockholders or our affiliates. In the event that any of our directors and officers who is also a director, officer or employee of any of the Fortress Parties or their affiliates acquires knowledge of a corporate opportunity or is offered a corporate opportunity, provided that this knowledge was not acquired solely in such person’s capacity as a director or officer of us and such person acts in good faith, then to the fullest extent permitted by law such person is deemed to have fully satisfied
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such person’s fiduciary duties owed to us and is not liable to us if any of the Fortress Parties, or their respective affiliates, pursues or acquires the corporate opportunity or if such person did not present the corporate opportunity to us.
The ability of our Manager and its officers and employees to engage in other business activities, subject to the terms of our Management Agreement, may reduce the amount of time our Manager, its officers or other employees spend managing us. In addition, we may engage (subject to our strategy) in material transactions with our Manager or another entity managed by our Manager or one of its affiliates, including FTAI and FECI, which may include, but are not limited to, certain acquisitions, financing arrangements, purchases of debt, co-investments, consumer loans, servicing advances and other assets that present an actual, potential or perceived conflict of interest. Our board of directors adopted a policy regarding the approval of any “related party transactions” pursuant to which certain of the material transactions described above may require disclosure to, and approval by, the independent members of our board of directors. Actual, potential or perceived conflicts have given, and may in the future give, rise to investor dissatisfaction, litigation or regulatory inquiries or enforcement actions. Appropriately dealing with conflicts of interest is complex and difficult, and our reputation could be damaged if we fail, or appear to fail, to deal appropriately with one or more potential, actual or perceived conflicts of interest. Regulatory scrutiny of, or litigation in connection with, conflicts of interest could have a material adverse effect on our reputation, which could materially adversely affect our business in a number of ways, including causing an inability to raise additional funds, a reluctance of counterparties to do business with us, a decrease in the prices of our equity securities and a resulting increased risk of litigation and regulatory enforcement actions.
The structure of our Manager’s compensation arrangements may have unintended consequences for us. We have agreed to pay our Manager a management fee that is based on different measures of performance. Consequently, there may be conflicts in the incentives of our Manager to generate attractive risk-adjusted returns for us. Investments with higher yield potential are generally riskier or more speculative than investments with lower yield potential. This could result in increased risk to the value of our portfolio of assets and our common stock.
Our directors have approved a broad asset acquisition strategy for our Manager and will not approve each acquisition we make at the direction of our Manager. In addition, we may change our strategy without a stockholder vote, which may result in our acquiring assets that are different, riskier or less profitable than our current assets.
Our Manager is authorized to follow a broad asset acquisition strategy. We may pursue other types of acquisitions as market conditions evolve. Our Manager makes decisions about our investments in accordance with broad investment guidelines adopted by our board of directors. Accordingly, we may, without a stockholder vote, change our target sectors and acquire a variety of assets that differ from, and are possibly riskier than, our current asset portfolio. Consequently, our Manager has great latitude in determining the types and categories of assets it may decide are proper investments for us, including the latitude to invest in types and categories of assets that may differ from those in our existing portfolio. Our directors will periodically review our strategy and our portfolio of assets. However, our board will not review or pre-approve each proposed acquisition or our related financing arrangements. In addition, in conducting periodic reviews, the directors will rely primarily on information provided to them by our Manager. Furthermore, transactions entered into by our Manager may be difficult or impossible to reverse by the time they are reviewed by the directors even if the transactions contravene the terms of the Management Agreement. In addition, we may change our asset acquisition strategy, including our target asset classes, without a stockholder vote.
Our asset acquisition strategy may evolve in light of existing market conditions and investment opportunities, and this evolution may involve additional risks depending upon the nature of the assets we target and our ability to finance such assets on a short or long-term basis. Opportunities that present unattractive risk-return profiles relative to other available opportunities under particular market conditions may become relatively attractive under changed market conditions and changes in market conditions may therefore result in changes in the assets we target. Decisions to make acquisitions in new asset categories present risks that may be difficult for us to adequately assess and could therefore reduce or eliminate our ability to pay dividends on our common stock or have adverse effects on our liquidity or financial condition. A change in our asset acquisition strategy may also increase our exposure to interest rate, foreign currency or credit market fluctuations. In addition, a change in our asset acquisition strategy may increase our use of non-match-funded financing, increase the guarantee obligations we agree to incur or increase the number of transactions we enter into with affiliates. Our failure to accurately assess the risks inherent in new asset categories or the financing risks associated with such assets could adversely affect our results of operations and our financial condition.
Our Manager will not be liable to us for any acts or omissions performed in accordance with the Management Agreement, including with respect to the performance of our assets.
Pursuant to our Management Agreement, our Manager will not assume any responsibility other than to render the services called for thereunder in good faith and will not be responsible for any action of our board of directors in following or declining to follow its advice or recommendations. Our Manager, its members, managers, officers, employees, sub-advisers and any other person controlling our Manager, will not be liable to us or any of our subsidiaries, to our board of directors, or our or any subsidiary’s stockholders or partners for any acts or omissions by our Manager, its members, managers, officers, employees, sub-advisers and any other person controlling our Manager, except liability to us, our stockholders, directors, officers and employees and persons controlling us, by reason of acts constituting bad faith, willful misconduct, gross negligence or reckless disregard of our Manager’s duties under our Management Agreement. We will, to the full extent lawful, reimburse, indemnify and hold our Manager, its members, managers, officers and employees, sub-advisers and each other person, if any, controlling our Manager harmless of and from any and all expenses, losses, damages, liabilities, demands, charges and claims of any nature whatsoever (including attorneys’ fees) in respect of or arising from any acts or omissions of an indemnified party made in good faith in the
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performance of our Manager’s duties under our Management Agreement and not constituting such indemnified party’s bad faith, willful misconduct, gross negligence or reckless disregard of our Manager’s duties under our Management Agreement.
Our Manager’s due diligence of potential asset acquisitions or other transactions may not identify all pertinent risks, which could materially affect our business, financial condition, liquidity and results of operations.
Our Manager intends to conduct due diligence with respect to each asset acquisition opportunity or other transaction it pursues. It is possible, however, that our Manager’s due diligence processes will not uncover all relevant facts, particularly with respect to any assets we acquire from third parties. In these cases, our Manager may be given limited access to information about the asset and will rely on information provided by the seller of the asset. In addition, if asset acquisition opportunities are scarce, the process for selecting bidders is competitive, or the timeframe in which we are required to complete diligence is short, our ability to conduct a due diligence investigation may be limited, and we would be required to make decisions based upon a less thorough diligence process than would otherwise be the case. Accordingly, transactions that initially appear to be viable may prove not to be over time, due to the limitations of the due diligence process or other factors.
We may compete with affiliates of and entities managed by our Manager which could adversely affect our and their results of operations.
Affiliates of and entities managed by our Manager are primarily engaged in the infrastructure and energy business and invest in, and actively manage, portfolios of infrastructure and energy investments and other assets. Affiliates of and entities managed by our Manager are not restricted in any manner from competing with us. After the spin-off, affiliates of and entities managed by our Manager may decide to invest in the same types of assets that we invest in. Furthermore, certain of our directors and officers are the same as certain of our Manager’s affiliates. See “—Risks Related to Our Manager—There are conflicts of interest in our relationship with our Manager.”
Risks Related to the Spin-off
The ownership by some of our directors of common shares, options, or other equity awards of FTAI may create, or may create the appearance of, conflicts of interest.
Because some of our directors also currently hold positions with FTAI, they own FTAI common shares, options to purchase FTAI common shares or other equity awards. For example, Judith Hannaway and Ray Robinson are directors of both FTAI and FTAI Infrastructure, and Joseph Adams, Jr., who is the chairman of the board of both FTAI and FTAI Infrastructure and is the chief executive officer of FTAI, owns common shares and options to purchase common shares in both FTAI and FTAI Infrastructure. Ownership by some of our directors of common shares or options to purchase common shares of FTAI, or any other equity awards, creates, or may create the appearance of, conflicts of interest when these directors are faced with decisions that could have different implications for FTAI than they do for us.
We share certain key directors with FTAI, which means those officers do not devote their full time and attention to our affairs and the overlap may give rise to conflicts.
There is an overlap between certain key directors of the Company and of FTAI. Judith Hannaway and Ray Robinson are directors of both the Company and FTAI, and Joseph Adams, Jr. is the chairman of the board of directors of both the Company and FTAI, and continues to serve as the chief executive officer of FTAI. Shared directors may have actual or apparent conflicts of interest with respect to matters involving or affecting each company. For example, there will be the potential for a conflict of interest when we on the one hand, and FTAI and its respective subsidiaries and successors on the other hand, are party to commercial transactions concerning the same or adjacent investments. In addition, certain of our directors and officers continue to own shares and/or options or other equity awards of FTAI. These ownership interests could create actual, apparent or potential conflicts of interest when these individuals are faced with decisions that could have different implications for our company and FTAI. See “Certain Relationships and Related Party Transactions—Our Manager and Management Agreement” in the Information Statement filed with the SEC on Form 8-K on July 15, 2022 for a discussion of certain procedures we instituted to help ameliorate such potential conflicts that may arise.
Risks Related to the Wheeling Acquisition
We may be unable to successfully integrate the businesses and realize the anticipated benefits of the Wheeling Acquisition.
The success of the Wheeling Acquisition will depend, in part, on our ability to successfully integrate Wheeling, with our business and realize the anticipated benefits, including synergies, cost savings, innovation and operational efficiencies, from this combination. If we are unable to achieve these objectives within the anticipated time frame, or at all, the anticipated benefits may not be realized fully, or at all, or may take longer to realize than expected and the value of our common stock may be harmed. Additionally, as a result of the Wheeling Acquisition, rating agencies may take negative actions against our credit ratings, which may increase our financing costs.
The integration of Wheeling into our business is a complex, costly and time-consuming process, and may result in material challenges, including, without limitation:
•failure to successfully integrate Wheeling in a manner that permits us to realize the anticipated benefits of the acquisition;
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•managing a larger rail platform;
•difficulties expanding our customer base;
•difficulties and delays integrating Wheeling’s operations and systems and retaining key employees;
•higher than anticipated costs incurred in connection with the integration of Wheeling;
•the possibility of faulty assumptions underlying expectations regarding the integration process;
•retaining existing business and operational relationships and attracting new business and operational relationships;
•disruptions to our ongoing business and diversion of our management’s attention caused by transition or integration activities involving Wheeling;
•consolidating corporate and administrative infrastructures and eliminating duplicative functions;
•assumption of pre-existing contractual relationships of Wheeling that we may not have otherwise entered into, the termination or modification of which may be costly or disruptive to our business;
•unanticipated issues in integrating information technology, communications and other systems;
•incurring debt to finance the Wheeling Acquisition, which will increase our debt service requirements, expense and leverage;
•any potential litigation arising from the transaction; and
•unanticipated changes in applicable federal or state laws or regulations.
Many of these factors will be outside of our control and any one of them could result in delays, increased costs, decreases in the amount of expected revenues and diversion of management’s time and energy, which could materially affect our financial position, results of operations and cash flows.
We may not have discovered undisclosed liabilities or other issues of Wheeling during our due diligence process, and we may not have adequate legal protection from potential liabilities of, or in respect of our acquisition of Wheeling.
In the course of the due diligence review of Wheeling that we conducted prior to the execution of the Stock Purchase Agreement, we may not have discovered, or may have been unable to quantify, undisclosed liabilities or other issues relating to Wheeling and its subsidiaries. Moreover, we may not have adequate legal protection from potential liabilities of, or in respect of our acquisition of Wheeling, irrespective of whether or not such potential liabilities were discovered. Examples of such undisclosed or potential liabilities or other issues may include, but are not limited to, pending or threatened litigation, regulatory and environmental compliance, tax liabilities, indemnification of obligations, undisclosed counterparty termination rights, or undisclosed letter of credit or guarantee requirements. Any such undisclosed or potential liabilities or other issues could have an adverse effect on our business, results of operations, financial condition and cash flows.
Wheeling faces competition from other railroads and other transportation providers.
Wheeling faces competition from other railroads, motor carriers, ships, barges, and pipelines. Wheeling operates in some corridors served by other railroads and motor carriers. In addition to price competition, Wheeling faces competition with respect to transit times, quality, and reliability of service from motor carriers and other railroads. Motor carriers in particular can have an advantage over railroads with respect to transit times and timeliness of service. However, railroads are much more fuel-efficient than trucks, which reduces the impact of transporting goods on the environment and public infrastructure. Additionally, Wheeling must build or acquire and maintain its rail system, while trucks, barges, and maritime operators are able to use public rights-of-way maintained by public entities. Any of the following could also affect the competitiveness of our rail services, which could have a material adverse effect on our results of operations, financial condition, and liquidity: (i) improvements or expenditures materially increasing the quality or reducing the costs of these alternative modes of transportation, such as autonomous or more fuel efficient trucks, (ii) legislation that eliminates or significantly increases the size or weight limitations applied to motor carriers, or (iii) legislation or regulatory changes that impose operating restrictions on railroads or that adversely affect the profitability of some or all railroad traffic. Additionally, any future consolidation of the rail industry could materially affect our competitive environment.
Wheeling has material customer concentration, with a limited number of customers accounting for a material portion of our revenues.
Wheeling earned approximately 7% of its total revenues for the three months ended March 31, 2026 from one customer. There are inherent risks whenever a large percentage of total revenues are concentrated with a limited number of customers. It is not possible for us to predict the future level of demand for Wheeling’s services that will be generated by these customers or the future demand for the products and services of these customers in the end-user marketplace. In addition, revenues from these customers may fluctuate from time to time, which may be affected by market conditions or other factors, some of which may be outside of our control. If any of these customers experience declining or delayed sales due to market, economic or competitive conditions, or undergo material management or ownership changes, Wheeling could be pressured to reduce the prices it charges for its services or could lose a major customer. Any such development could have a significant adverse impact on the business and financial condition of the Company.
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The future results of the Company may be adversely impacted if the Company does not effectively manage its expanded operations following the completion of the Wheeling Acquisition.
As a result of the Wheeling Acquisition, the size of the Company’s business has increased significantly. The Company’s ability to successfully manage this expanded business will depend, in part, upon management’s ability to design and implement strategic initiatives that address not only the integration of Wheeling, but also the increased scale and scope of the combined business with its associated increased costs and complexity.
Wheeling has not been required to comply with the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley”).
Prior to the Wheeling Acquisition, Wheeling was a privately-held company not subject to Sarbanes-Oxley. Sarbanes-Oxley requires public companies to have and maintain effective internal control over financial reporting to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial statements and to have management report on the effectiveness of those controls on an annual basis (and have its independent public accountants attest annually to the effectiveness of such internal controls). As a private company, Wheeling is not required to comply with the requirements of Sarbanes-Oxley.
We have begun applying our Sarbanes-Oxley procedures regarding internal controls over financial reporting with respect to Wheeling. This process will require us to expend a significant amount of time from our management and other personnel and will require us to expend a significant amount of financial resources, which is likely to increase our compliance costs. Even after expending such resources, we cannot assure you that we will be able to conclude that our internal controls over financial reporting with respect to Wheeling are effective within the time frame required. If we are not able to comply with the requirements of Sarbanes-Oxley in a timely manner, we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would entail expenditure of additional financial and management resources and could materially adversely affect the combined company.
Risks Related to Our Common Stock
The market price and trading volume of our common stock may be volatile, which could result in rapid and substantial losses for our stockholders.
The market price of our common stock may be highly volatile and could be subject to wide fluctuations. In addition, the trading volume in our common stock may fluctuate and cause significant price variations to occur. If the market price of our common stock declines significantly, you may be unable to resell your stock at or above your purchase price, if at all. The market price of our common stock may fluctuate or decline significantly in the future. Some of the factors that could negatively affect our stock price or result in fluctuations in the price or trading volume of our stock include:
•a shift in our investor base;
•our quarterly or annual earnings, or those of other comparable companies;
•actual or anticipated fluctuations in our operating results;
•changes in accounting standards, policies, guidance, interpretations or principles;
•announcements by us or our competitors of significant investments, acquisitions or dispositions;
•the failure of securities analysts to cover our common stock;
•changes in earnings estimates by securities analysts or our ability to meet those estimates;
•the operating and share price performance of other comparable companies;
•overall market fluctuations;
•general economic conditions; and
•developments in the markets and market sectors in which we participate.
Stock markets in the United States have experienced extreme price and volume fluctuations. Market fluctuations, as well as general political and economic conditions, such as acts of terrorism, prolonged economic uncertainty, the potential for worsening economic conditions, economic downturn, a recession or interest rate or currency rate fluctuations, could adversely affect the market price of our common stock.
An increase in market interest rates may have an adverse effect on the market price of our common stock.
One of the factors that investors may consider in deciding whether to buy or sell our stock is our distribution rate as a percentage of our stock price relative to market interest rates. If the market price of our common stock is based primarily on the earnings and return that we derive from our investments and income with respect to our investments and our related distributions to stockholders, and not from the market value of the investments themselves, then interest rate fluctuations and capital market conditions will likely affect the market price of our common stock. For instance, if market interest rates rise without an increase in our distribution rate, the market price of our common stock could decrease, as potential investors may require a higher distribution yield on our stock or seek other securities paying higher distributions or interest. In addition, rising interest rates
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would result in increased interest expense on our outstanding and future (variable and fixed) rate debt, thereby adversely affecting cash flows and our ability to service our indebtedness and pay distributions.
There can be no assurance that the market for our common stock will provide you with adequate liquidity.
There can be no assurance that an active trading market for our common stock will develop or be sustained in the future, and the market price of our stock may fluctuate widely, depending upon many factors, some of which may be beyond our control. These factors include, without limitation:
•a shift in our investor base;
•our quarterly or annual earnings and cash flows, or those of other comparable companies;
•actual or anticipated fluctuations in our operating results;
•changes in accounting standards, policies, guidance, interpretations or principles;
•announcements by us or our competitors of significant investments, acquisitions, dispositions or other transactions;
•the failure of securities analysts to cover our stock;
•changes in earnings estimates by securities analysts or our ability to meet those estimates;
•market performance of affiliates and other counterparties with whom we conduct business;
•the operating and stock price performance of other comparable companies;
•our failure to maintain our exemption under the Investment Company Act or satisfy Nasdaq listing requirements;
•negative public perception of us, our competitors or industry;
•overall market fluctuations; and
•general economic conditions.
Stock markets in general have experienced volatility that has often been unrelated to the operating performance of a particular company. These broad market fluctuations may adversely affect the market price of our common stock.
Failure to maintain effective internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 could have a material adverse effect on our business and stock price.
As a public company, we are required to maintain effective internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002. Internal control over financial reporting is complex and may be revised over time to adapt to changes in our business, or changes in applicable accounting rules. We may make investments through joint ventures and accounting for such investments can increase the complexity of maintaining effective internal control over financial reporting. We cannot assure you that our internal control over financial reporting will be effective in the future or that a material weakness will not be discovered with respect to a prior period for which we had previously believed that our internal control over financial reporting was effective. If we are not able to maintain or document effective internal control over financial reporting, our independent registered public accounting firm may issue an adverse opinion as to the effectiveness of our internal control over financial reporting. Matters impacting our internal control over financial reporting may cause us to be unable to report our financial information on a timely basis or may cause us to restate previously issued financial information, and thereby subject us to adverse regulatory consequences, including sanctions or investigations by the SEC, or violations of applicable stock exchange listing rules. There could also be a negative reaction in the financial markets due to a loss of investor confidence in us and the reliability of our financial statements. Confidence in the reliability of our financial statements is also likely to suffer if we or our independent registered public accounting firm reports a material weakness in the effectiveness of our internal control over financial reporting. This could materially adversely affect us by, for example, leading to a decline in our stock price and impairing our ability to raise capital.
Your percentage ownership in us may be diluted in the future.
Your percentage ownership in us may be diluted in the future because of equity awards that we expect will be granted to our Manager, to the directors, officers and employees of our Manager who perform services for us, and to our directors, officers and employees, as well as other equity instruments such as debt and equity financing, including, but not limited to, the Series B Preferred Stock, the Series I Warrants (as defined in Note 19 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025) and the Series A Warrants (as defined in Note 19 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025).
On August 1, 2022, our board of directors adopted the FTAI Infrastructure Inc. Nonqualified Stock Option and Incentive Award Plan (the “Incentive Plan”), which provides for the ability to grant compensation awards in the form of stock, options, stock appreciation rights, restricted stock, performance awards, manager awards, tandem awards, other stock-based awards (including restricted stock units) and non-stock-based awards, in each case to our Manager, to the directors, officers, employees, service providers, consultants and advisors of our Manager who perform services for us, and to our directors, officers, employees, service providers, consultants and advisors. We initially reserved 30,000,000 shares of our common stock for issuance under the Incentive Plan. On the date of any equity issuance by us during the ten-year term of the Incentive Plan, that
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number will be increased by a number of shares of our common stock equal to 10% of (i) the number of shares of our common stock newly issued by us in such equity issuance or (ii) if such equity issuance relates to equity securities other than our common stock, the number of shares of our common stock equal to the quotient obtained by dividing the gross capital raised in such equity issuance by the fair market value of a share of our common stock as of the date of such equity issuance (such quotient, the “Equity Security Factor”). The term of the Incentive Plan expires in 2032. For a more detailed description of the Incentive Plan, see “Management—FTAI Infrastructure Nonqualified Stock Option and Inventive Award Plan” in the Information Statement filed with the SEC on Form 8-K on July 15, 2022. Upon the successful completion of an equity offering by us, we will issue to our Manager (or an affiliate of our Manager), as compensation for our Manager’s role in raising capital for us, options to purchase shares of our common stock equal to up to 10% of (i) the aggregate number of shares of our common stock being issued in such offering or (ii) if such equity issuance relates to equity securities other than shares of our common stock, the number of shares of our common stock equal to the Equity Security Factor. In addition, the compensation committee of our board of directors has the authority to grant such other awards to our Manager as it deems advisable; provided that no such award may be granted to our Manager in connection with any issuance by us of equity securities in excess of 10% of (i) the maximum number of shares of our common stock then being issued or (ii) if such equity issuance relates to equity securities other than shares of our common stock, the maximum number of shares of our common stock determined in accordance with the Equity Security Factor.
The Series B Redeemable Convertible Preferred Stock may be converted into a maximum of 22,237,370 shares of our common stock, subject to customary anti-dilution adjustments and assuming shareholder approval is not sought and obtained to issue additional shares. Furthermore, the Series I Warrants and the Series A Warrants represent the right to purchase 3,342,566 shares of common stock and 550,000 shares of common stock, respectively, at an exercise price of $10.00 per share, subject to customary anti-dilution adjustments.
Our common stock is subject to ownership and transfer restrictions intended to preserve our ability to use our net operating loss carryforwards and other tax attributes.
We have incurred and may also continue to incur significant net operating loss carryforwards and other tax attributes, the amount and availability of which are subject to certain qualifications, limitations, and uncertainties. Our certificate of incorporation imposes certain restrictions on the transferability and ownership of our common stock, preferred stock, and other interests treated as our “stock” (such stock and other interests, the “Corporation Securities,” such restrictions on transferability and ownership, the “Ownership Restrictions”) in order to reduce the possibility of an equity ownership shift that could result in limitations on our ability to utilize net operating loss carryforwards for U.S. federal income tax purposes. Any acquisition of Corporation Securities that results in a stockholder being in violation of these restrictions may not be valid.
Subject to certain exceptions (including with respect to Initial Substantial Stockholders, as defined in our certificate of incorporation), the Ownership Restrictions will restrict (i) any person or entity (including certain groups of persons) from directly or indirectly acquiring 4.8% or more of the outstanding Corporation Securities and (ii) the ability of any person or entity (including certain groups of persons) already owning, directly or indirectly, 4.8% or more of the Corporation Securities to increase their proportionate interest in, or to sell, the Corporation Securities. Any transferee receiving Corporation Securities that would result in a violation of the Ownership Restrictions will not be recognized as an FTAI Infrastructure stockholder or entitled to any rights of stockholders, including, without limitation, the right to vote and receive dividends or distributions, whether liquidating or otherwise, in each case, with respect to the Corporation Securities causing the violation. FTAI Infrastructure common stockholders whose ownership violates the Ownership Restrictions at the time of the spin-off will not be required to sell their FTAI Infrastructure common stock, but may be prevented from acquiring more Corporation Securities.
The Ownership Restrictions will remain in effect until the earlier of (i) the date on which Section 382 of the Code is repealed, amended, or modified in such a way as to render the restrictions imposed by Section 382 of the Code no longer applicable to us or (ii) a determination by the board of directors that (1) an ownership change would not result in a substantial limitation on our ability to use our available net operating loss carryforwards and other tax attributes; (2) no significant value attributable to our available net operating loss carryforwards and other tax attributes would be preserved by continuing the transfer restrictions; or (3) it is not in our best interests to continue the Ownership Restrictions. The Ownership Restrictions may also be waived by the board of directors on a case-by-case basis. There is no assurance, however, that the Company will not experience a future ownership change under Section 382 that may significantly limit its ability to use its NOL carryforwards as a result of such a waiver or otherwise.
The Ownership Restrictions described above could make it more difficult for a third party to acquire, or could discourage a third party from acquiring, a large block of our common stock. This may adversely affect the marketability of our common stock by discouraging existing or potential investors from acquiring our stock or additional shares of our stock. It is also possible that the transfer restrictions could delay or frustrate the removal of incumbent directors and could make more difficult a merger, tender offer or proxy contest involving us, or impede an attempt to acquire a significant or controlling interest in us, even if such events might be beneficial to us and our stockholders.
You are advised to carefully monitor your ownership of our common stock and consult your legal advisors to determine whether your ownership of our common stock violates the ownership restrictions that are in our certificate of incorporation.
We may incur or issue debt or issue equity, which may negatively affect the market price of our common stock.
We may in the future incur or issue debt or issue equity or equity-related securities. In the event of our liquidation, lenders and holders of our debt and holders of our preferred stock (if any) would receive a distribution of our available assets before common stockholders. Any future incurrence or issuance of debt would increase our interest cost and could adversely affect our results of
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operations and cash flows. We are not required to offer any additional equity securities to existing common stockholders on a preemptive basis. Therefore, additional issuances of common stock, directly or through convertible or exchangeable securities, warrants or options, including, but not limited to, the Series B Redeemable Convertible Preferred Stock, the Series I Warrants and the Series A Warrants, will dilute the holdings of our existing common stockholders and such issuances, or the perception of such issuances, may reduce the market price of our common stock. Any additional preferred stock issued by us would likely have, a preference on distribution payments, periodically or upon liquidation, which could eliminate or otherwise limit our ability to make distributions to common stockholders. Because our decision to incur or issue debt or issue equity or equity-related securities in the future will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing, nature or success of our future capital raising efforts. Thus, stockholders bear the risk that our future incurrence or issuance of debt or issuance of equity or equity-related securities will adversely affect the market price of our stock.
Provisions of Delaware law, our certificate of incorporation and our bylaws, prevent or delay an acquisition of our company, which could decrease the market price of our common stock.
Delaware law contains, and our certificate of incorporation and bylaws contain, provisions that are intended to deter coercive takeover practices and inadequate takeover bids by making such practices or bids unacceptably expensive to the raider and to encourage prospective acquirers to negotiate with our board of directors rather than to attempt a hostile takeover. These provisions include, among others:
•a classified board of directors with staggered three-year terms;
•provisions regarding the election of directors, classes of directors, the term of office of directors and the filling of director vacancies;
•provisions regarding corporate opportunity;
•removal of directors only for cause and only with the affirmative vote of at least 80% of the then issued and outstanding shares of our capital stock entitled to vote in the election of directors;
•our board of directors to determine the powers, preferences and rights of our preferred stock and to issue such preferred stock without stockholder approval;
•advance notice requirements applicable to stockholders for director nominations and actions to be taken at annual meetings;
•a prohibition will be in our certificate of incorporation that states that directors will be elected by plurality vote, a provision which means that the holders of a majority of the issued and outstanding shares of common stock can elect all the directors standing for election;
•a requirement in our bylaws specifically denying the ability of our stockholders to consent in writing to take any action in lieu of taking such action at a duly called annual or special meeting of our stockholders; and
•our Corporation Securities are subject to ownership and transfer restrictions in order to reduce the possibility of an equity ownership shift that could result in limitations on our ability to utilize net operating loss carryforwards for U.S. federal income tax purposes.
Public stockholders who might desire to participate in these types of transactions may not have an opportunity to do so, even if the transaction is considered favorable to stockholders. These anti-takeover provisions could substantially impede the ability of public stockholders to benefit from a change in control or a change in our management and board of directors and, as a result, may adversely affect the market price of our common stock and your ability to realize any potential change of control premium.
Our bylaws contain exclusive forum provisions for certain claims, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
Our bylaws, to the fullest extent permitted by law, provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of us; (ii) any action asserting a claim of breach of a duty (including any fiduciary duty) owed by any of our current or former directors, officers or employees to us or our stockholders; (iii) any action asserting a claim against us or any of our current or former directors, officers, stockholders, employees or agents arising out of or relating to any provision of the DGCL or our certificate of incorporation or our bylaws; or (iv) any action asserting a claim against us or any of our current or former directors, officers, stockholders, employees or agents governed by the internal affairs doctrine of the State of Delaware. As described below, this provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act, or rules and regulations thereunder.
Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all claims brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder and our bylaws will provide that the federal district courts of the United States of America will, to the fullest extent permitted by law, be the sole and exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act. Our decision to adopt such a federal forum provision followed a decision by the Supreme Court of the State of Delaware holding that such provisions are facially valid under Delaware law. While there can be no assurance that federal or state courts will follow the holding of the Delaware Supreme Court or determine that our federal forum provision should be enforced in a particular case, application of our federal forum provision
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means that suits brought by our stockholders to enforce any duty or liability created by the Securities Act must be brought in federal court and cannot be brought in state court.
Section 27 of the Exchange Act creates exclusive federal jurisdiction over all claims brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder and our bylaws will provide that the exclusive forum provision does not apply to suits brought to enforce any duty or liability created by the Exchange Act. Accordingly, actions by our stockholders to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder must be brought in federal court. Our stockholders will not be deemed to have waived our compliance with the federal securities laws and the regulations promulgated thereunder.
Any person or entity purchasing or otherwise acquiring or holding any interest in any of our securities shall be deemed to have notice of and consented to our exclusive forum provisions, including the federal forum provision; provided, however, that stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder. Additionally, our stockholders cannot waive compliance with the federal securities laws and the rules and regulations thereunder. These provisions may limit our stockholders’ ability to bring a claim in a judicial forum they find favorable for disputes with us or our directors, officers or other employees, which may discourage lawsuits against us and our directors, officers and other employees and agents. Alternatively, if a court were to find the choice of forum provision contained in our bylaws to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, operating results and financial condition.
While we currently pay regular quarterly dividends to our stockholders, we may change our dividend policy at any time.
Although we currently pay regular quarterly dividends to holders of our common stock, we may change our dividend policy at any time. Our net cash provided by operating activities could be less than the amount of distributions to our stockholders. The declaration and payment of dividends to holders of our common stock will be at the discretion of our board of directors in accordance with applicable law after taking into account various factors, including actual results of operations, liquidity and financial condition, net cash provided by operating activities, restrictions imposed by applicable law, limitations under our contractual agreements, including the agreements governing certain of our debt financings, our taxable income, our operating expenses and other factors our board of directors deem relevant. There can be no assurance that we will continue to pay dividends in amounts or on a basis consistent with prior distributions to our investors, if at all. Furthermore, our net cash provided by operating activities could be less than the amount of distributions to our stockholders. Because we are a holding company and have no direct operations, we will only be able to pay dividends from our available cash on hand and any funds we receive from our subsidiaries and our ability to receive distributions from our subsidiaries may be limited by the financing agreements to which they are subject.
As a public company, we will incur additional costs and face increased demands on our management.
As an independent public company with shares listed on Nasdaq, we need to comply with an extensive body of regulations that did not apply to us previously, including certain provisions of the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, regulations of the SEC and requirements of Nasdaq. These rules and regulations will increase our legal and financial compliance costs and make some activities more time-consuming and costly. For example, as a result of becoming a public company, we must have independent directors and board committees.
If securities or industry analysts do not publish research or reports about our business, or if they downgrade their recommendations regarding our common stock, our stock price and trading volume could decline.
The trading market for our common stock will be influenced by the research and reports that industry or securities analysts publish about us or our business. If any of the analysts who may cover us downgrades our common stock or publishes inaccurate or unfavorable research about our business, our common stock price may decline. If analysts cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our common stock price or trading volume to decline and our common stock to be less liquid.
Our determination of how much leverage to use to finance our acquisitions may adversely affect our return on our assets and may reduce funds available for distribution.
We utilize leverage to finance many of our asset acquisitions, which entitles certain lenders to cash flows prior to retaining a return on our assets. While our Manager targets using only what we believe to be reasonable leverage, our strategy does not limit the amount of leverage we may incur with respect to any specific asset. The return we are able to earn on our assets may be significantly reduced due to changes in market conditions, which may cause the cost of our financing to increase relative to the income that can be derived from our assets.
Non-U.S. persons that hold or have held (actually or constructively) more than 5% of our common stock may be subject to U.S. federal income tax upon the disposition of some or all of their stock.
If a non-U.S. person has held (actually or constructively) more than 5% of our common stock at any time within the shorter of the five-year period ending on the date of a sale, exchange, or other taxable disposition of our stock or the period that such non-U.S. person held our stock, and we were considered a “USRPHC” at any time during such period because of our current or previous ownership of U.S. real property interests above a certain threshold, such non-U.S. person may be subject to U.S. tax on such disposition of such stock (and may have a U.S. tax return filing obligation). A corporation generally is a USRPHC if the fair market value of its U.S. real property interests, as defined in the Code and applicable Treasury regulations, equals or exceeds 50% of
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the aggregate fair market value of its worldwide real property interests and its other assets used or held for use in a trade or business. We believe that we are and are likely to remain a USRPHC. If a non-U.S. person is subject to U.S. tax as described above, gain recognized on the disposition of our common stock generally will be subject to U.S. federal income tax on a net income basis in the same manner as if the non-U.S. person were a U.S. person. In addition, if we are a USRPHC and our common stock ceased to be treated as “regularly traded on an established securities market,” a non-U.S. person would generally be subject to tax in the manner described in the preceding sentence regardless of what percentage of our common stock it owned, and the transferee in any disposition would generally be required to withhold 15% of the amount realized on the disposition. Non-U.S. stockholders are urged to consult their tax advisors regarding the tax consequences of an investment in our stock.
Changes to United States federal income tax laws could materially and adversely affect us and our stockholders.
The present United States federal income tax laws may be modified, possibly with retroactive effect, by legislative, judicial, or administrative action at any time, which could affect the United States federal income tax treatment of us or an investment in our common stock. The United States federal income tax rules are constantly under review by persons involved in the legislative process, the Internal Revenue Service, and the United States Treasury Department, which results in statutory changes as well as frequent revisions to regulations and interpretations. We cannot predict how changes in the tax laws might affect us and our stockholders.
We experienced an “ownership change” for purposes of Section 382 of the Code, which limits our ability to utilize our net operating loss and certain other tax attributes to reduce our future taxable income.
Although we currently have significant tax attributes, including significant net operating losses, our use of those attributes is subject to significant limitations as a result of the fact that we believe we underwent an “ownership change” for purposes of Section 382 of the Code in the first half of 2025. Specifically, Section 382 of the Code imposes an annual limitation on the ability of a company that undergoes an “ownership change” to utilize its net operating loss and certain built-in losses to offset taxable income earned in years after the ownership change. The Code also contains other limitations on the use of net operating losses and other tax attributes, which may impact our ability to utilize such losses and attributes. As a result of the Section 382 limitation and potentially other limitations or changes in circumstances, our use of our tax attributes may be significantly delayed, and we may not be able to use all of those attributes, potentially harming our future operating results by effectively increasing our future U.S. federal income tax obligations. In addition, we may be subject to similar or other limitations under state, local or other tax laws.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
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Item 6. Exhibits
| Exhibit No. | Description | ||||||||||
| * | 2.1 | Separation and Distribution Agreement, dated as of August 1, 2022, between FTAI Infrastructure Inc. and Fortress Transportation and Infrastructure Investors LLC (incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | |||||||||
2.2 | Purchase Agreement, dated as of February 26, 2025, by and among FTAI Infrastructure Inc., Ohio River Partners Holdco LLC and Long Ridge Energy & Power LLC, and Labor Impact Fund, L.P., Labor Impact Feeder Fund, L.P., Labor Impact Real Estate (Cayman) Holdings, L.P. and LIF LR Holdings LLC (incorporated by reference to Exhibit 2.1 of the Company’s Current Report on Form 8-K, filed February 27, 2025). | ||||||||||
| * | 2.3 | Stock Purchase Agreement, dated as of August 6, 2025, between Percy Acquisition LLC and WLE Management Partners, L.P. (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed August 6, 2025). | |||||||||
3.1 | Certificate of Conversion (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
3.2 | Amended and Restated Certificate of Incorporation of FTAI Infrastructure Inc. (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
3.3 | Amended and Restated Bylaws of FTAI Infrastructure Inc. (incorporated by reference to Exhibit 3.3 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
3.4 | Certificate of Designations of Series B Convertible Junior Preferred Stock of FTAI Infrastructure Inc., dated as of February 26, 2025 (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K, filed February 27, 2025). | ||||||||||
4.1 | Description of Securities Registered under Section 12 of the Exchange Act (incorporated by reference to Exhibit 4.5 of the Company’s Annual Report on Form 10-K, filed March 16, 2026). | ||||||||||
4.2 | Indenture, dated as of February 19, 2025, among Long Ridge Energy LLC, Long Ridge Energy Generation LLC, Ohio GasCo LLC and U.S. Bank Trust Company, National Association, as trustee and collateral agent (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K, filed February 25, 2025). | ||||||||||
4.3 | Form of 8.750% Senior Secured Notes due 2032 (incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K, filed February 25, 2025). | ||||||||||
10.1 | Amended and Restated Management and Advisory Agreement, dated as of July 31, 2022, between FTAI Infrastructure Inc. and FIG LLC (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
10.2 | Form of Indemnification Agreement by and between FTAI Infrastructure Inc. and its directors and officers (incorporated by reference to Exhibit 10.8 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
| † | 10.3 | FTAI Infrastructure Inc. Nonqualified Stock Option and Incentive Award Plan (incorporated by reference to Exhibit 10.4 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | |||||||||
| † | 10.4 | Form of Award Agreement pursuant to the FTAI Infrastructure Inc. Nonqualified Stock Option and Incentive Award Plan (incorporated by reference to Exhibit 10.4 of the Company’s Registration Statement on Form 10, filed April 29, 2022). | |||||||||
| † | 10.5 | Form of Director Award Agreement pursuant to the FTAI Infrastructure Inc. Nonqualified Stock Option and Incentive Plan (incorporated by reference to Exhibit 10.5 of the Company’s Registration Statement on Form 10, filed April 29, 2022). | |||||||||
10.6 | Registration Rights Agreement, dated as of August 1, 2022, between FTAI Infrastructure Inc., FIG LLC and Fortress Worldwide Transportation and Infrastructure Master GP LLC (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
10.7 | Engineering, Procuring and Construction Agreement dated as of February 15, 2019, between Long Ridge Energy Generation LLC and Kiewit Power Constructors Co. (incorporated by reference to Exhibit 10.17 of Fortress Transportation and Infrastructure Investors LLC’s Quarterly Report on Form 10-Q, filed on May 3, 2019). | ||||||||||
10.8 | Purchase and Sale of Power Generation Equipment and Related Services Agreement dated as of February 15, 2019, between Long Ridge Energy Generation LLC and General Electric Company (incorporated by reference to Exhibit 10.18 of Fortress Transportation and Infrastructure Investors LLC's Quarterly Report on Form 10-Q, filed on May 3, 2019). | ||||||||||
10.9 | Second Amended and Restated Senior Loan Agreement, dated as of June 1, 2024 and effective as of June 20, 2024, between Jefferson 2020 Bond Borrower LLC and Port of Beaumont Navigation District of Jefferson County, Texas (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed June 20, 2024). | ||||||||||
10.10 | Deed of Trust, Security Agreement, Financing Statement and Fixture Filing, dated February 1, 2020, from Jefferson 2020 Bond Borrower LLC, as grantor, and Jefferson 2020 Bond Lessee LLC, as grantor, to Ken N. Whitlow, as Deed of Trust Trustee for the benefit of Deutsche Bank National Trust Company, as beneficiary (incorporated by reference to Exhibit 10.17 of Fortress Transportation and Infrastructure Investors LLC’s Quarterly Report on Form 10-Q, filed on May 1, 2020). | ||||||||||
10.11 | Amended and Restated Lease and Development Agreement, effective as of January 1, 2020, by and between Port of Beaumont Navigation District of Jefferson County, Texas, as lessor, and Jefferson 2020 Bond Lessee LLC, as lessee (incorporated by reference to Exhibit 10.18 of Fortress Transportation and Infrastructure Investors LLC’s Quarterly Report on Form 10-Q, filed on May 1, 2020). | ||||||||||
10.12 | Facilities Lease and Development Agreement, dated as of June 1, 2024 and effective as of June 20, 2024, between Jefferson 2020 Bond Lessee LLC and Port of Beaumont Navigation District of Jefferson County, Texas (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed June 20, 2024). | ||||||||||
10.13 | Deed of Trust, Security Agreement, Financing Statement and Fixture Filing (JTS Port Property), dated as of June 20, 2024, executed and delivered by Jefferson 2020 Bond Lessee LLC and Jefferson 2020 Bond Borrower LLC, in favor of the trustee named therein for the benefit of the Collateral Agent on behalf of the owners of the Securities (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K, filed June 20, 2024). | ||||||||||
10.14 | Membership Interest Purchase Agreement, dated June 7, 2021, by and between United States Steel Corporation and Percy Acquisition LLC (incorporated by reference to Exhibit 10.1 of Fortress Transportation and Infrastructure Investors LLC’s Current Report on Form 8-K, filed on June 8, 2021). | ||||||||||
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| Exhibit No. | Description | ||||||||||
10.15 | Railway Services Agreement, dated July 28, 2021, by and among United States Steel Corporation, Transtar, LLC, Delray Connecting Railroad Company, Fairfield Southern Company, Inc., Gary Railway Company, Lake Terminal Railroad Company, Texas & Northern Railroad Company and Union Railroad Company, LLC (incorporated by reference to Exhibit 10.22 of Fortress Transportation and Infrastructure Investors LLC’s Quarterly Report on Form 10-Q, filed on July 29, 2021). | ||||||||||
| * | 10.16 | Form of Subscription Agreement (incorporated by reference to Exhibit 10.17 of Amendment No. 2 to the Company’s Registration Statement on Form 10, filed July 1, 2022). | |||||||||
10.17 | Investor Rights Agreement, dated August 1, 2022, between FTAI Infrastructure Inc. and the parties listed thereto (incorporated by reference to Exhibit 10.6 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
10.18 | Warrant Agreement, dated August 1, 2022, between FTAI Infrastructure Inc. and American Stock Transfer & Trust Company, LLC, as warrant agent (incorporated by reference to Exhibit 10.5 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
10.19 | Trademark License Agreement, dated as of August 1, 2022, between Fortress Transportation and Infrastructure Investors LLC and FTAI Infrastructure Inc. (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
10.20 | Form of Letter sent to FTAI’s option holders describing the equitable adjustment to FTAI’s options (incorporated by reference to Exhibit 10.7 of the Company’s Current Report on Form 8-K, filed August 1, 2022). | ||||||||||
10.21 | Investor Rights Agreement, dated as of February 26, 2025, by and among FTAI Infrastructure Inc., Labor Impact Fund, L.P., LIF AIV 1, L.P., Labor Impact Feeder Fund, L.P. and Labor Impact Real Estate (Cayman) Holdings, L.P (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed February 27, 2025). | ||||||||||
10.22 | Amended and Restated Warrant Agreement, dated as of February 26, 2025, by and between FTAI Infrastructure Inc. and Equiniti Trust Company, LLC (f/k/a American Stock Transfer & Trust Company, LLC) (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed February 27, 2025). | ||||||||||
10.23 | Credit Agreement, dated as of February 19, 2025, among Long Ridge Energy LLC, Long Ridge Energy Generation LLC, Ohio GasCo LC, Citizens Bank, N.A., as Administrative Agent, U.S. Bank Trust Company, National Association, as collateral agent, Morgan Stanley Senior Funding, Inc., as sole lead arranger and bookrunner, and the various lenders party thereto (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed February 25, 2025). | ||||||||||
| * | 10.24 | Collateral Agency, Intercreditor and Accounts Agreement, dated as of May 28, 2025, by and among DRP Urban Renewal 4, LLC, Delaware River Partners LLC, the other Repauno Entities (as defined therein), Repauno Financing Holdco LLC, UMB Bank, N.A., and Deutsche Bank Trust Company Americas (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed June 3, 2025). | |||||||||
10.25 | Lease Agreement, dated as of May 28, 2025, by and between DRP Urban Renewal 4, LLC and the New Jersey Economic Development Authority (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed June 3, 2025). | ||||||||||
10.26 | Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of May 28, 2025, executed and delivered by DRP Urban Renewal 4, LLC, Delaware River Partners LLC, and the other Grantors (as defined therein) in favor of the collateral agent named therein for the behalf of the owners of the Series 2025 Bonds (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K, filed June 3, 2025). | ||||||||||
| * | 10.27 | Senior Secured Credit Agreement, dated as of May 28, 2025, by and among DRP Urban Renewal 4, LLC, Delaware River Partners LLC, Deutsche Bank Company Americas, Deutsche Bank AG, New York Branch, and the several lenders party from time to time thereto (incorporated by reference to Exhibit 10.4 of the Company’s Current Report on Form 8-K, filed June 3, 2025). | |||||||||
| * | 10.28 | Amended and Restated Limited Liability Company Agreement of FIP RR Holdings LLC, dated as of August 25, 2025, by and among FIP RR Holdings LLC, FTAI Infrastructure Inc. (solely with respect to Section 2.3(c) and Section 12.21) and the other parties thereto (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K, filed August 25, 2025). | |||||||||
| * | 10.29 | Warrant Agreement, dated as of August 25, 2025, by and among FIP RR Holdings LLC, FTAI Infrastructure Inc. (solely with respect to Section 7 and Section 14) and the holders party thereto (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K, filed August 25, 2025). | |||||||||
| * | 10.30 | Credit Agreement, dated as of February 25, 2026, among FTAI Infrastructure Inc., the guarantors from time to time party thereto, the Lenders from time to time party thereto, certain other financial institutions from time to time party thereto and Alter Domus (US) LLC, as administrative agent (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed February 26, 2026). | |||||||||
| * | 10.31 | Equity Purchase Agreement, dated as of April 29, 2026, by and among Ohio River Partners Holdco LLC, Ohio River Partners Finance LLC, MARA USA Corporation, and, solely for the purposes specified therein, MARA Holdings, Inc. and FTAI Infrastructure Inc. (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K, filed April 30, 2026). | |||||||||
31.1 | Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||||||||||
31.2 | Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||||||||||
32.1 | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||||||||||
32.2 | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||||||||||
| 101 | The following financial information from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Operations; (iii) Consolidated Statements of Comprehensive (Loss) Income; (iv) Consolidated Statements of Changes in Equity; (v) Consolidated Statements of Cash Flows; and (vi) Notes to Consolidated Financial Statements. | ||||||||||
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| Exhibit No. | Description | ||||||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | ||||||||||
| † | Management contracts and compensatory plans or arrangements. | ||||||||||
| * | Portions of this exhibit have been omitted. | ||||||||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized:
FTAI INFRASTRUCTURE INC.
| By: | /s/ Kenneth J. Nicholson | Date: | May 8, 2026 | |||||||||||
| Kenneth J. Nicholson | ||||||||||||||
| Chief Executive Officer and President | ||||||||||||||
| By: | /s/ Carl R. Fletcher IV | Date: | May 8, 2026 | |||||||||||
Carl R. Fletcher IV | ||||||||||||||
Chief Financial Officer and Chief Accounting Officer | ||||||||||||||
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FAQ
How did FTAI Infrastructure (FIP) perform financially in Q1 2026?
FTAI Infrastructure posted a Q1 2026 net loss of $127.2 million on revenue of $188.4 million. Revenue nearly doubled year over year, but higher interest expense, a $45.9 million debt extinguishment loss, and preferred dividends and accretion drove the swing to a loss.
What were FTAI Infrastructure’s key profitability metrics and EPS in Q1 2026?
Net loss attributable to common stockholders was $154.5 million, or $(1.32) per diluted share. Adjusted EBITDA, the company’s primary non-GAAP performance metric, was $70.6 million, down from $155.2 million in the prior-year quarter, reflecting higher costs and financing expenses.
How leveraged is FTAI Infrastructure (FIP) based on the March 31, 2026 balance sheet?
FTAI Infrastructure reported total debt of $3.84 billion and total assets of $5.69 billion at March 31, 2026. Total equity was negative $303.1 million, and redeemable preferred stock totaled $1.12 billion, underscoring a highly leveraged capital structure.
What major financing actions did FTAI Infrastructure take during Q1 2026?
The company entered a $1.35 billion Term Loan maturing February 1, 2028 at 9.75% interest. Proceeds repaid its Bridge Loan Credit Agreement and the June 2025 Jefferson Credit Agreement. It also arranged a $255 million bridge backstop commitment for 2024 Jefferson taxable bonds.
What is the Long Ridge Energy & Power sale and how large is it?
After quarter-end, FTAI Infrastructure agreed to sell Long Ridge Energy & Power LLC for a base purchase price of $1.52 billion. The agreement provides for customary purchase price adjustments and is expected to reduce total debt and enhance liquidity once completed.
How did FTAI Infrastructure’s revenue mix change across segments in Q1 2026?
Railroad generated $85.0 million of revenue, Jefferson Terminal $27.3 million and Power and Gas $62.0 million in Q1 2026. Corporate and Other added $12.8 million and Repauno $1.2 million, highlighting increased contributions from Railroad and Power and Gas versus the prior year.