Stabilis Solutions, Inc.

STABILIS SOLUTIONS, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Description of Business

Stabilis Solutions, Inc. and its subsidiaries (the “Company”, “Stabilis”, “our”, “us” or “we”) is an energy transition company that provides turnkey clean energy production, storage, transportation and fueling solutions using liquefied natural gas (“LNG”) to multiple end markets.

The Company serves customers in diverse end markets, including aerospace, agriculture, energy, industrial, marine bunkering, mining, pipeline, remote power and utility markets. LNG can be used to deliver natural gas to locations where pipeline service is unavailable, has been interrupted, or needs to be supplemented. Additionally, LNG can be used as a partner fuel for renewable energy, and as an alternative to traditional fuel sources, such as distillate fuel oil (including diesel fuel and other fuel oils) and propane, among others, to provide both environmental and economic benefits.

The Company also builds power and control systems for the energy industry in China through its 40% owned Chinese joint venture, BOMAY Electric Industries, Inc (“BOMAY”). BOMAY is accounted for under the equity method.

Basis of Presentation and Consolidation

The accompanying unaudited, interim condensed consolidated financial statements (“Condensed Consolidated Financial Statements”) include our accounts and those of our subsidiaries and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and disclosures normally included in the notes to consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. We believe that the presentation and disclosures within this report are adequate to prevent the information presented herein from being misleading. The Condensed Consolidated Financial Statements reflect all adjustments (consisting of normal recurring adjustments) for a fair presentation of the interim periods. The results of operations for the interim periods presented arenot necessarily indicative of the results of operations to be expected for the full year. The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the audited consolidated financial statements as of and for the year ended* December 31, 2024* included in the Company's Annual Report on Form10-K, as filed on* February 25,*2025.

All intercompany accounts and transactions have been eliminated in consolidation. In the Notes to Condensed Consolidated Financial Statements, all dollar amounts in tabulations are in thousands, unless otherwise indicated.

Use of Estimates in the Preparation of the Consolidated Financial Statements

The preparation of the Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates include the determination of fair value of equity-based awards, fair value of natural gas derivatives, carrying amount of contingencies, valuation allowances for receivables, inventories, and deferred income tax assets, valuations assigned to assets and liabilities in business combinations, and impairments of long-lived assets. Actual results could differ from those estimates, and these differences could be material to the Condensed Consolidated Financial Statements.

Segment Reporting

In accordance with ASC Topic280 - "Segment Reporting (ASC280)" the Company has determined that it has a single operating and reporting segment. As a result, the Company's segment accounting policies are the same as described herein and the Company doesnot have any material intra-segment sales and transfers of assets. The Company's Chief Operating Decision Maker ("CODM") is the Chief Executive Officer (the "CEO"). The CEO, with the Chief Financial Officer assesses the performance and makes operating decisions of the Company on a consolidated basis, based on the Company's net increase in shareholder's equity resulting from operations ("net income"). Company assets arenot reviewed by the CODM at a different asset level or category, but at the consolidated level. As the Company's operations are comprised of a single operating segment, the segment assets are reflected on the accompanying Condensed Consolidated Balance Sheets as "total assets" and the significant segment expenses are listed on the accompanying Condensed Consolidated Statement of Operations.

Derivative Instruments

The Company had certain natural gas derivative instruments as of* December 31, 2024*. At* June 30, 2025* the Company hadno transactions accounted for as derivatives as they had matured. At* December 31, 2024*, the fair value of the Company's derivatives was $0.1 million. The accounting for changes in the fair value of a derivative instrument depends on whether it qualifies for and has been designated as a hedge as well as the type of hedge. The Company hasnot designated its derivatives as hedges under U.S. GAAP. The Company didnot enter into any derivative transactions for speculative purposes during the periods presented. The Company enters into forward sales contracts for the delivery of LNG to its customers. Certain of these sales contracts contain provisions that* maymeet the criteria of a derivative in the event delivery isnot* made. These contracts are accounted for under the normal purchase normal sales exclusion under U.S. GAAP and arenot measured at fair value each reporting period.

Recent Accounting Pronouncements

In* November 2024,the FASB issued ASU2024*-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic220-40): Disaggregation of Income Statement Expenses" which requires companies to disclose disaggregated information about certain costs and expenses in the notes to the financial statements. ASU2024-03 is effective for companies for annual reporting periods beginning after* December 15, 2026.The requirements can be applied either prospectively or retrospectively. Although early adoption is permitted, the Company will adopt the pronouncement when the pronouncement becomes effective on January 1, 2027.The Company doesnot* expect the adoption of ASU2024-03 to have a significant impact on its consolidated financial statements.

In* December 2023,the FASB issued ASU2023*-09, “Income Taxes (Topic740): Improvements to Income Tax Disclosures", which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. Under ASU2023-09, companies must consistently categorize and provide greater disaggregation of information in the rate reconciliation and further disaggregate income taxes paid. ASU2023-09 is effective for companies for annual reporting periods beginning after* January 1, 2025.The Company doesnot* expect the adoption of ASU2023-09 to have a significant impact on its consolidated financial statements.

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2. REVENUE RECOGNITION

We recognize revenues when the transfer of promised goods or services are delivered to our customers in accordance with the applicable customer contract and we are entitled to be paid by the customer. Revenues are measured as consideration specified in the contract and exclude any sales incentives and amounts collected on behalf ofthird parties. Revenues from contracts with customers are disaggregated into (1) LNG Product (2) rental (3) service and (4) other. Certain contracts* may*include multiple goods or services such as the usage of equipment and delivery of field support services that are bundled into an all-in price to the customer for each gallon of LNG delivered. Revenue recognition under these contracts requires significant judgment by the Company in order to determine the appropriate accounting for these transactions, including whether performance obligations should be accounted for separately versus together, how the price should be allocated among the performance obligations, and when to recognize revenue for each performance obligation. The Company has determined that these contracts have multiple performance obligations and the Company allocates the contract price to each performance obligation using its best estimates of the respective standalone selling price of each distinct good or service at the time the contract was negotiated.

LNG Product revenues

LNG Product revenues represent the sale of LNG from both produced and purchased sources as well as the transportation performed to deliver the LNG to our customer location. LNG Product revenues are recognized upon delivery of the LNG to the customer, at which point the customer controls the product and the Company has an unconditional right to payment. The Company acts as a principal when using* third party transportation companies and therefore recognizes the gross revenue for the supply of LNG. The Company doesnot differentiate between the revenue from the sale of LNG production and purchased LNG as the criteria for revenue recognition are identical. Some of our contracts contain minimum take-or-pay amounts where a customer has agreed to source a minimum volume of LNG under the contract. Take or pay revenues are only recognized when the customer has failed to take the minimum contracted volumes upon completion of the time period specified within the contract and the Company has the unconditional right to receive payment for the take or pay amount. Certain of our sales contracts contain provisions that maymeet the criteria of a derivative in the event delivery isnot* made. These contracts are accounted for under the normal purchase normal sales exclusion under U.S. GAAP and arenot measured at fair value each reporting period. Our LNG contracts are generallyone to24 months in duration.

Rental revenues

Rental revenues are generated from the rental of cryogenic equipment to our customers. Rental revenues arenot dependent upon the gallons delivered but based upon day rates or monthly rates for the use of equipment as specifically established within the contract and are disaggregated from LNG Product revenues. Revenues related to rental of equipment are recognized under Topic606 andnot ASC842: Leases, as the Company maintains control of the equipment that the customer uses and can replace the rented equipment with similar equipment should the rented equipment become inoperable or the Company chooses to replace the equipment for maintenance purposes. Revenue is recognized as the rental period is completed and for periods that cross month end, revenue is recognized for the portion of the rental period that has been completed to date. Performance obligations for rental revenue are considered to be satisfied as the rental period is completed based upon the terms of the related contract. The stated rental rates within each contract are representative of the stand-alone rental rates at the time the contract was negotiated.

Service revenues

Service revenues are generated from engineering and field support services and represent the human resources provided to the customer to support the use of LNG at the customer’s job site. These include support and costs for mobilization and demobilization of equipment at customer sites as well as onsite technical support while customers are consuming LNG. Service revenues arenot dependent upon the gallons delivered or rental period but based upon the specific contractual terms and can be based on an event (i.e. mobilization or demobilization) or an hourly rate as specifically established within the contract and are disaggregated from LNG Product revenues and Rental revenues. Service revenue is recognized as the event is completed or work is done. The stated hourly labor rates in each contract are representative of the stand-alone hourly rates at the time the contract was negotiated.

Other revenues

Other revenues* *are items that, due to their nature, are disaggregated from the categories mentioned above such as expenses incurred by the Company on behalf of the customer that we contractually rebill to our customers on a cost-plus basis.

Disaggregated revenues

The table below presents revenue disaggregated by source, for thethree andsix months ended* June 30, 2025and2024* (in thousands):

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The table below presents revenue disaggregated by geographic location, for thethree andsix months ended* June 30, 2025and2024* (in thousands):

Variable and other Revenue Components

Certain of our contracts* mayinclude rental or services that mayvary upon the customer demands at stated rates within the contract and are satisfied as the work is authorized by the customer and performed by the Company. LNG product sales agreements may*include both fixed and variable fees per gallon of LNG but is representative of the stand-alone selling price for LNG at the time the contract is negotiated. We have concluded that the variable LNG fees meet the exception for allocating variable consideration to specific parts of the contract. As such, the variable consideration for these contracts is allocated to each distinct gallon of LNG and recognized when that distinct gallon of LNG is delivered to the customer.

Taxes assessed by a governmental authority that are directly imposed on revenue-producing transactions between the Company and its customers, such as sales, use and value-added taxes, are excluded from revenue.

3. PREPAID EXPENSES AND OTHER CURRENT ASSETS

The Company’s prepaid expenses and other current assets at* June 30, 2025* and* December 31, 2024* consisted of the following (in thousands):

4. PROPERTY, PLANT AND EQUIPMENT

The Company’s property, plant and equipment at* June 30, 2025* and* December 31, 2024* consisted of the following (in thousands):

Depreciation expense totaled $1.9 million and $1.8 million for thethree months ended* June 30, 2025and June 30, 2024*, respectively. Depreciation expense totaled $3.7 million and $3.6 million for thesix months ended* June 30, 2025and June 30, 2024*, respectively, all of which is included in the Condensed Consolidated Statements of Operations as a separate line item.

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5. INVESTMENT IN FOREIGN JOINT VENTURE

The Company holds a 40% interest in BOMAY, which builds electrical systems. The majority partner in this foreign joint venture is Baoji Oilfield Machinery Co., Ltd. (a subsidiary of China National Petroleum Corporation), which owns 51%. The remaining 9% is owned by AA Energies, Inc. The Company madeno sales to its joint venture during thethree andsix months ended* June 30, 2025and2024*.

We account for our investment in BOMAY using the equity method of accounting. Under the equity method, the Company’s share of the joint venture operations earnings or losses is recognized in the Condensed Consolidated Statements of Operations as equity income (loss) from foreign joint venture operations. Joint venture income increases the carrying value of the joint venture and joint venture losses reduce the carrying value. Dividends received from the joint venture reduce the carrying value. The Company considers dividend distributions received from its equity method investments which donot exceed cumulative equity in earnings subsequent to the date of investment to be a return on investment and classifies these distributions as operating activities in the accompanying Condensed Consolidated Statements of Cash Flows.

The tables below present a summary of BOMAY's assets, liabilities and equity at* June 30, 2025* and* December 31, 2024*, and its operational results for thethree andsix months ended* June 30, 2025and2024* in U.S. dollars (in thousands):

The table below presents the components of our investment in BOMAY and a summary of the activity within those components for thesix months ended* June 30, 2025* in U.S. dollars (in thousands):

In accordance with our long-lived asset policy, when events or circumstances indicate the carrying amount of an asset* may**not* be recoverable, management tests long-lived assets for impairment. If the estimated future cash flows are projected to be less than the carrying amount, an impairment write-down (representing the carrying amount of the long-lived asset which exceeds the present value of estimated expected future cash flows) would be recorded as a period expense. In making this evaluation, a variety of quantitative and qualitative factors are considered including national and local economic, political and market conditions, industry trends and prospects, liquidity and capital resources and other pertinent factors. Based on this evaluation for this reporting period, the Company doesnot believe an impairment of our investment in BOMAY is necessary for the period ending* June 30, 2025*.

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6. ACCRUED LIABILITIES

The Company’s accrued liabilities at* June 30, 2025* and* December 31, 2024* consisted of the following (in thousands):

Management Transition

Effective* January 31, 2025,the Company appointed the Company’s Chairman of the Board, J. Casey Crenshaw, as its Executive Chairman, and interim President and Chief Executive Officer. Mr. Crenshaw replaced Westervelt T. Ballard, Jr., who mutually agreed with the Company to terminate his employment as the Company’s President and Chief Executive Officer and voluntarily resigned his position as a director. As part of Mr. Ballard’s separation, the Company entered into a release and consulting agreement with Mr. Ballard whereby the Company will pay Mr. Ballard separation pay of $1.0 million, paid in equal or near equal installments over atwelve*-month period, and additional pay of $41 thousand representing an amount equal to a prorated bonus at "target" performance that Mr. Ballard would have received for his2025 performance and reimbursement of COBRA premiums over what Mr. Ballard would normally pay for Company provided insurance up to a maximum of 18 months. Additionally, Mr. Ballard will receive a payment of $49 thousand per month for the remainder of2025 for his consulting services. The Company recorded expense of $1.7 million, consisting of $1.6 million related to Mr. Ballard’s cumulative separation pay, additional pay and consulting pay and $0.1 million of other separation related expenses, all of which was expensed in thefirst quarter and all of which are included in selling, general and administrative expenses in the accompanying Condensed Consolidated Statement of Operations during thesix months ended* June 30, 2025*. As of* June 30, 2025*, a total of $1.0 million of this amount remains unpaid and is included in current liabilities on our Condensed Consolidated Balance Sheet and the above table within accrued compensation and benefits.

As part of Mr. Ballard’s release and consulting agreement the Company also accelerated vesting and amended option exercise terms for certain equity awards. See additional discussion in Note10.

7. DEBT

The Company’s carrying value of debt, net of debt issuance costs at* June 30, 2025* and* December 31, 2024* consisted of the following (in thousands):

During thethree months ended* June 30, 2025and2024*, interest expense was $0.1 million and$0.1 million, respectively. The Company capitalized interest of $0.1 million and$0.1 million, respectively. Interest expense of*$0.1* million and $0.1 million was recorded during thesix months ended* June 30, 2025and2024*, respectively, and the Company capitalized interest of $0.2 million and$0.2 million, respectively.

Revolving Credit Facility

On* March 27, 2025the Company, along with its subsidiaries, Stabilis LNG Eagle Ford LLC, Stabilis GDS, Inc. and Stabilis LNG Port Allen, LLC (collectively, the “Borrowers”) entered into a Modification Agreement (the "Agreement") to the existing Loan Agreement (the "Loan Agreement") with Cadence Bank. Under the Agreement, the $10.0 million revolving credit facility ("Revolving Credit Facility") maturity date was extended to June 9, 2028.Additionally, the Agreement amended the Fixed Charge Coverage Ratio terms primarily related to the inclusion of excess cash. As of June 30, 2025*,no amounts have been drawn under the Revolving Credit Facility.

The Revolving Credit Facility, as amended, contains a maximum aggregate borrowing amount of $10.0 million, subject to a borrowing base of80% of eligible accounts receivable. As of* June 30, 2025*, the Company has $2.9 million availability under the Revolving Credit Facility. The Company* may*request an increase in the maximum aggregate amount under the Revolving Credit Facility by up to $5.0 million, subject to the approval of Cadence Bank. All borrowings under the Revolving Credit Facility are secured by the Company’s accounts receivable and deposit accounts. Borrowings under the Revolving Credit Facility incur interest at the Prime Rate published by the Wall Street Journal. Any unused portion is subject to a quarterly unused commitment fee of 0.5% per annum.

The Revolving Credit Facility contains various restrictions and covenants. Among other requirements, the Borrowers must maintain a consolidated net worth of at least $52.4 million as of* June 30, 2025*, such minimum amount increasing on* December 31of each fiscal year thereafter by 50% of the Borrowers’ positive net income for that fiscal year, and must maintain a minimum Fixed Charge Coverage Ratio of 1.2 to1.0* on a consolidated basis, as defined in the Revolving Credit Facility, as of the last day of each fiscal quarter, on a trailingtwelve (12) months basis. The Revolving Credit Facility also contains customary events of default. If an event of default under the Revolving Credit Facility occurs and is continuing, then Cadence Bank* maydeclare any outstanding obligations under the Revolving Credit Facility to be immediately due and payable. In addition, if any of the Borrowers become the subject of voluntary or involuntary proceedings under any bankruptcy, insolvency or similar law, then any outstanding obligations under the Loan Agreement will automatically become immediately due and payable. As of June 30, 2025*, the Company was in compliance with all its covenants related to the Revolving Credit Facility.

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Secured Term Note

On* April 8, 2021,the Company entered into a loan agreement (the “AmeriState Loan Agreement”) with AmeriState Bank (“Lender”), to provide for an advancing loan facility in the aggregate principal amount of up to $10.0 million (the “AmeriState Loan”). The AmeriState Loan Agreement is secured by specific equipment owned by the Company. On September 19, 2023,the AmeriState Loan Agreement was amended (the "First Amendment"), for the purpose of substituting certain items of collateral under the AmeriState Loan Agreement. The AmeriState Loan is a term loan facility, matures on April 8, 2031and bears interest at 5.75% per annum through April 8, 2026,and the U.S. prime lending rate plus 2.5% per annum thereafter. The AmeriState Loan provides that proceeds from borrowings maybe used for working capital purposes at the Company’s liquefaction plant in George West, Texas and related fees and costs associated with the AmeriState Loan. As of June 30, 2025*, $7.7 million remained outstanding with $1.0 million in remaining availability for future draws.

The AmeriState Loan Agreement requires the Company to meet certain financial covenants which include a debt-to-net-worth ratio ofnot more than 9.1 to1.0 and a debt service coverage ratio ofnot less than 1.2 to1.0 on an annual basis beginning* December 31, 2024*. The Company was in compliance with all of its debt covenants as of* June 30, 2025*. Upon an Event of Default (as defined in the AmeriState Loan Agreement), the Lender* may (*i) terminate its commitment, (ii) declare the outstanding principal amount of the Advancing Notes (as defined in the AmeriState Loan Agreement) due and payable, or (iii) exercise all rights and remedies available to Lender under the AmeriState Loan Agreement.

Insurance Notes Payable

The Company finances its annual commercial insurance premiums for its business and operations. For the2024-2025 policies, the amount financed was $1.0 million. The outstanding principal balance on the premium finance note was $0.1 million at* June 30, 2025*. The Company makes equal monthly payments of principal and interest over the term of the note. The interest rate for the insurance financing is 7.95%. At* December 31, 2024*, the note's outstanding principal balance was $0.9 million.

8. RELATED PARTY TRANSACTIONS

Casey Crenshaw (our Executive Chairman of the Board and interim President and Chief Executive Officer) is the beneficial owner of 50% of The Modern Group and is deemed to jointly control The Modern Group with family members.

During thefirst quarter, the Company entered into a lease agreement to lease office space from The Modern Group at a market rate of $28 thousand per month. This lease qualified as an operating lease under U.S. GAAP resulting in a right-of-use asset ("ROU" asset) and operating lease liability of $0.3 million included on the Company's Condensed Consolidated Balance Sheet at* June 30, 2025*. In addition, the Company also purchases supplies and services from subsidiaries of The Modern Group.

For thethree months ended* June 30, 2025and2024*, the Company had total purchases and lease payments of $0.1 million and $37 thousand, respectively. The Company had $0.1 million and$0.1 million for thesix months ended* June 30, 2025and2024*, respectively. The Company hadno sales to The Modern Group during thethree andsix months ended* June 30, 2025and2024*. As of* June 30, 2025* and* December 31, 2024*, the Company hadno accounts receivable due from The Modern Group andno accounts payable due to The Modern Group.

Chart Energy and Chemicals, Inc. ("Chart E&C") beneficially owns 7.9% of our outstanding common stock at* June 30, 2025*. For thethree months ended* June 30, 2025and2024*, the Company had total purchases from Chart E&C of $13 thousand and $0.1 million, respectively. The Company made purchases from Chart E&C of$0.1 million for thesix months ended* June 30, 2025* and $0.3 million for thesix months ended* June 30, 2024.The Company hadno sales to Chart E&C during thethree* andsix months ended* June 30, 2025and2024*. The Company hadno accounts receivable due from Chart E&C at* June 30, 2025* and* December 31, 2024*. The Company hadno accounts payable due to Chart E&C at* June 30, 2025* and an immaterial amount of accounts payable due to Chart E&C at* December 31, 2024*.

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9. COMMITMENTS AND CONTINGENCIES

Environmental Matters* *

The Company is subject to federal, state and local environmental laws and regulations. The Company doesnot anticipate any expenditures to comply with such laws and regulations that would have a material impact on the Company’s condensed consolidated financial position, results of operations or liquidity. The Company believes that its operations comply, in all material respects, with applicable federal, state and local environmental laws and regulations.

Litigation, Claims and Contingencies

The Company* maybecome party to various legal actions that arise in the ordinary course of its business. The Company is also subject to audit by tax and other authorities for varying periods in various federal, state and local jurisdictions, and disputes mayarise during the course of these audits. It is impossible to determine the ultimate liabilities that the Company mayincur resulting from any of these lawsuits, claims, proceedings, audits, commitments, contingencies and related matters or the timing of these liabilities, if any. If these matters were to ultimately be resolved unfavorably, it is possible that such an outcome could have a material adverse effect upon the Company’s condensed consolidated financial position, results of operations, or liquidity. The Company doesnot,* however, anticipate such an outcome and it believes the ultimate resolution of these matters willnot have a material adverse effect on the Company’s condensed consolidated financial position, results of operations, or liquidity.

10. STOCKHOLDERS’** EQUITY AND STOCK-BASED COMPENSATION**

Stock-based Compensation

The Company includes stock compensation expense within general and administrative expenses in the Condensed Consolidated Statements of Operations. The Company recognized stock compensation expense of $0.0 million and $0.4 million during thethree months ended* June 30, 2025and2024*, respectively. During thesix months ended* June 30, 2025and2024*, the Company recognized$0.4 million and $0.8 million of stock compensation expense, respectively.

Issuance of Stock-based Awards

The Company has a long-term incentive plan (the “Amended and Restated Plan”) which provides for a maximum number of shares of common stock available for issuance of 5,500,000 shares. The plan was amended in2023 to increase the maximum number of shares from 4,000,000 to 5,500,000, as approved by shareholders. Awards under the Amended and Restated Plan* maybe granted to employees, officers and directors of the Company and affiliates, and any other person who provides services to the Company and its affiliates (including independent contractors and consultants of the Company and its subsidiaries). Awards maybe granted in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalents, substitute awards, other stock-based awards, cash awards and/or any combination of the foregoing.No participant mayreceive a grant covering more than 2,000,000 shares of our common stock in any year and a non-employee member of the Board may**not* be granted more than 100,000 shares in any year.

The Company didnot grant any stock-based awards during thesix months ended* June 30, 2025*.

Issuances of Common Stock

During thesix months ended* June 30, 2025*, and2024, shares of common stock were issued upon vesting of restricted stock units, net of withholding shares for tax payments, totaling 11,287 shares and 11,623 shares, respectively. There wereno stock options or stock appreciation rights exercised during thesix months ended* June 30, 2025* or2024.

Management Transition

Effective* January 31, 2025,the Company and Mr. Ballard agreed that 7,765 unvested restricted stock units and 147,525 unvested stock options granted under the Company's Amended and Restated Long-Term Incentive Plan would vest as of the date of Mr. Ballard’s separation of employment (see Note6*). Additionally, the exercise period of these options plus 1.6 million options which had vested prior to Mr. Ballard’s separation was amended to expire* December 31,2025. The amendment of the exercise period represents a modification of an equity award under U.S. GAAP and the Company recognized$0.4 million in additional non-cash stock compensation expense related to the adjustment of the exercise period of his options to December 31, 2025.*The assumptions included in estimating the additional expense include:

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11. NET INCOME PER SHARE

The calculation of net income per common share for thesix months ended* June 30, 2025and2024* are presented below. Dilutive securities consist of unvested restricted stock units ("RSUs") deemed outstanding using the treasury method. There wereno dilutive securities at* June 30, 2025*, as all RSUs had vested and 2,074,505 stock options had exercise prices exceeding the market price and inclusion would have been anti-dilutive for the period due to the Company's net loss at* June 30, 2025*. At* June 30, 2024* RSUs excluded from dilutive securities under the treasury method were 11,593 shares;2,074,505 stock options were excluded, as the exercise price exceeded the market price, and 658,437 stock appreciation rights ("SARs") were excluded, as the exercise price exceeded the market price. The SARs expired unexercised on* December 31, 2024.*

12. SUPPLEMENTAL CASH FLOW INFORMATION

The Company's supplemental disclosure of cash flow information for thesix months ended* June 30, 2025and2024* is as follows (in thousands):

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