# EDGAR Filing Document

**Accession Number:** 0000846913
**File Stem:** 0001437749-25-024872
**Filing Date:** 2025-8
**Character Count:** 25156
**Document Hash:** abdc378dfa0b0bc3731fa8f8dacd23bf
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001437749-25-024872.hdr.sgml**: 20250805

**ACCESSION NUMBER**: 0001437749-25-024872

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 15

**CONFORMED PERIOD OF REPORT**: 20250805

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20250805

**DATE AS OF CHANGE**: 20250805

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** FUEL TECH, INC.
- **CENTRAL INDEX KEY:** 0000846913
- **STANDARD INDUSTRIAL CLASSIFICATION:** INDUSTRIAL & COMMERCIAL FANS & BLOWERS & AIR PURIFYING EQUIP [3564]
- **ORGANIZATION NAME:** 06 Technology
- **EIN:** 205657551
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-33059
- **FILM NUMBER:** 251185459

**BUSINESS ADDRESS:**
- **STREET 1:** 27601 BELLA VISTA PARKWAY
- **CITY:** WARRENVILLE
- **STATE:** IL
- **ZIP:** 60555
- **BUSINESS PHONE:** 6308454431

**MAIL ADDRESS:**
- **STREET 1:** 27601 BELLA VISTA PARKWAY
- **CITY:** WARRENVILLE
- **STATE:** IL
- **ZIP:** 60555

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** FUEL TECH N V
- **DATE OF NAME CHANGE:** 19930510

?xml version='1.0' encoding='ASCII'? ftek20250729_8k.htm

**United States**

**Securities And Exchange Commission**

**Washington, D.C. 20549**

**FORM 8-K**

**CURRENT REPORT**

**Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934**

Date of Report (Date of earliest event reported) August 5, 2025

**FUEL TECH, INC.**

(Exact name of registrant as specified in its charter)

---

| | | |
|:---|:---|:---|
| **Delaware**<br> (State or other jurisdiction<br> of incorporation) | **001-33059**<br> (Commission<br> File Number) | **20-5657551**<br> (IRS Employer<br> Identification No.) |

---

**Fuel Tech, Inc.**

**27601 Bella Vista Parkway**

**Warrenville, IL 60555-1617**

**630-845-4500**

**(Address and telephone number of principal executive offices)**

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common Stock | FTEK | NASDAQ |

---

**Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provision:**

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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. ☐

------

**ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.**

On August 5, 2025, Fuel Tech, Inc. ("Fuel Tech" or the "Registrant") issued a press release which contained, among other things, an announcement of Fuel Tech's financial results for the fiscal quarter ended June 30, 2025. A copy of the Press Release is furnished as Exhibit 99.1 to this Form 8-K.

**ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.**

**(a) Financial Statements of Businesses Acquired.**

None.

**(b) Pro Forma Financial Information.**

None.

**(d) Exhibits.**

**<u>Exhibit No.</u>** &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; **<u>Description</u>**

99.1 [Release of Fuel Tech, Inc. dated August 5, 2025.](ex_845186.htm)

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

**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 hereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **Fuel Tech, Inc.** | **Fuel Tech, Inc.** |
|  | (Registrant) | (Registrant) |
| Date: August 5, 2025 |  |  |
|  | By: | /s/ Ellen T. Albrecht |
|  |  | Ellen T. Albrecht |
|  |  | &nbsp;&nbsp;&nbsp;&nbsp; Vice President, Chief Financial Officer<br> &nbsp;&nbsp;&nbsp;&nbsp; and Treasurer |

---

## Exhibit 99.1

**Exhibit 99.1**

![ex_845186img001.jpg](ex_845186img001.jpg)

---

| | | |
|:---|:---|:---|
| CONTACT: | Vince Arnone | Devin Sullivan |
|  | President and CEO | Managing Director |
|  | (630) 845-4500 | The Equity Group Inc. |
|  |  | <u>dsullivan@theequitygroup.com</u> |

---

**<u>FOR IMMEDIATE RELEASE</u>**

**<u>FUEL TECH REPORTS 2025 SECOND QUARTER FINANCIAL RESULTS</u>**

**WARRENVILLE, Ill., August 5, 2025** – **Fuel Tech, Inc. (NASDAQ: FTEK)**, a technology company using advanced engineering processes to provide emissions control systems and water treatment technologies in utility and industrial applications, today reported financial results for the second quarter ended June 30, 2025.

"Our second quarter results, along with ongoing developments across our two business segments and our Dissolved Gas Infusion business, strengthen our confidence in delivering improved overall performance in the second half of the year," said Vincent J. Arnone, President and CEO. "We are actively pursuing new contract opportunities across our APC and FUEL CHEM® business segments. For the APC segment, in particular, we are addressing both traditional end markets and the significant prospects offered by the rising demand for data centers. We have multiple bids outstanding for our SCR technology to address the emissions control requirements of AI-related data centers to be built in the U.S. over the next several years. We remain closely engaged with these potential partners and are excited about the opportunities that lie ahead."

He concluded, "We are supported in our efforts by a strong financial position. At June 30, 2025, our balance sheet included nearly $31 million in cash, cash equivalents and investments and no long-term debt."

**<u>Business Segment Performance Overview</u>**

Performance within our FUEL CHEM® segment was steady compared to last year's second quarter reflecting seasonal weather transition from spring to summer. Based on FUEL CHEM's strong performance in the early part of the third quarter, the Company anticipates robust segment results for the full third quarter of 2025 and full-year segment revenue to reach its highest level since 2022. The Company is continuing to pursue the expansion of its client base and expects that a demonstration of its TIFI® Targeted In-Furnace Injection™ technology will commence in the fourth quarter of this year at a coal-fired unit in the Midwest.

------

Segment revenue within Air Pollution Control ("APC") declined due primarily to timing of project execution on existing contracts. Before the end of the month of August, we are confident that we will be awarded between $2.5 and $3.0 million in additional contracts from new and existing U.S. and international customers. These new awards would increase our effective APC backlog.

In July, the Company commenced an extended demonstration of its Dissolved Gas Infusion (DGI<sup>®</sup>) technology at a fish hatchery in the Western U.S. The demonstration is expected to last until the second quarter of 2026 and is designed to evaluate the benefits of delivering consistent and precise levels of dissolved oxygen on the raising of gamefish in a controlled environment.

**<u>Second Quarter 2025 (</u>**<u>"</u>**<u>Q2 2025</u>**<u>"</u>**<u>) Consolidated Results Overview</u>**

***All comparisons are to the second quarter ended June 30, 2024 unless otherwise stated*.**

Consolidated revenues for Q2 2025 declined to $5.6 million from $7.0 million, primarily driven by lower APC revenues associated with timing of project execution on existing contracts.

Consolidated gross margin for Q2 2025 expanded to 45.5% of revenues from 41.9% of revenues, reflecting an increase in both APC and FUEL CHEM segment gross margins.

SG&A expenses rose slightly to $3.3 million from $3.2 million. As a percentage of revenues, SG&A expenses rose to 60.2% in Q2 2025 from 46.1%, reflecting lower revenues in Q2 2025.

Interest income rose to $0.5 million from $0.3 million, related primarily to the inclusion of $0.3 million related to the one-time collection of the Employee Retention Credit ("ERC") benefit under the CARES Act.

Net loss in Q2 2025 was $(689,000), or $(0.02) per share, compared to net loss of $(421,000), or $(0.02) per share.

Consolidated APC segment backlog at June 30, 2025 was $7.8 million compared to $10.3 million at March 31, 2025 and $6.2 million at December 31, 2024.

APC segment revenue decreased to $2.5 million from $3.9 million, primarily related to timing of project execution on existing contracts. Segment gross margin expanded to 43.9% from 39.1%, primarily due to product and project mix.

FUEL CHEM segment revenue was flat at $3.1 million. Segment gross margin expanded to 46.8% from 45.5%, reflecting an increased volume of sales activity combined with relatively flat segment administrative expenses.

Adjusted EBITDA loss was $(0.9) million in Q2 2025 compared to an Adjusted EBITDA loss of $(0.5) million.

------

**<u>Financial Condition</u>**

At June 30, 2025, cash and cash equivalents were $10.6 million, short-term investments were $12.4 million, and long-term investments totaled $7.9 million. Stockholders' equity at June 30, 2025 was $40.6 million, or $1.32 per share, and the Company had no debt.

**<u>Conference Call</u>**

Management will host a conference call on Wednesday, August 6, 2025 at 10:00 am ET / 9:00 am CT to discuss the results and business activities. Interested parties may participate in the call by dialing:

● (877) 423-9820 (*Domestic*) or

● (201) 493-6749 (*International*)

The conference call will also be accessible via the Upcoming Events section of the Company's web site at <u>www.ftek.com</u>. Following management's opening remarks, there will be a question-and-answer session.

**<u>About Fuel Tech</u>**

Fuel Tech develops and commercializes state-of-the-art proprietary technologies for air pollution control, process optimization, water treatment, and advanced engineering services. These technologies enable customers to operate in a cost-effective and environmentally sustainable manner. Fuel Tech is a leader in nitrogen oxide (NO<sub>x</sub>) reduction and particulate control technologies and its solutions have been installed on over 1,300 utility, industrial and municipal units worldwide. The Company's FUEL CHEM® technology improves the efficiency, reliability, fuel flexibility, boiler heat rate, and environmental status of combustion units by controlling slagging, fouling, corrosion and opacity. Water treatment technologies include DGI® Dissolved Gas Infusion Systems which utilize a patented saturator and a patent-pending channel injector to deliver supersaturated oxygen solutions and other gas-water combinations to target process applications or environmental issues. This infusion process has a variety of applications in the water and wastewater industries, including remediation, aeration, biological treatment and wastewater odor management. Many of Fuel Tech's products and services rely heavily on the Company's exceptional Computational Fluid Dynamics modeling capabilities, which are enhanced by internally developed, high-end visualization software. For more information, visit Fuel Tech's web site at <u>www.ftek.com</u>.

**NOTE REGARDING FORWARD-LOOKING STATEMENTS**

This press release contains "forward-looking statements" as defined in Section 21E of the Securities Exchange Act of 1934, as amended, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and reflect Fuel Tech's current expectations regarding future growth, results of operations, cash flows, performance and business prospects, and opportunities, as well as assumptions made by, and information currently available to, our management. Fuel Tech has tried to identify forward-looking statements by using words such as "anticipate," "believe," "plan," "expect," "estimate," "intend," "will," and similar expressions, but these words are not the exclusive means of identifying forward-looking statements. These statements are based on information currently available to Fuel Tech and are subject to various risks, uncertainties, and other factors, including, but not limited to, contracts being awarded to competitors offering different or lower-priced technologies, projects being suspended, delayed or cancelled and other risks discussed in Fuel Tech's Annual Report on Form 10-K in Item 1A under the caption "Risk Factors," and subsequent filings under the Securities Exchange Act of 1934, as amended, which could cause Fuel Tech's actual growth, results of operations, financial condition, cash flows, performance and business prospects and opportunities to differ materially from those expressed in, or implied by, these statements. Fuel Tech undertakes no obligation to update such factors or to publicly announce the results of any of the forward-looking statements contained herein to reflect future events, developments, or changed circumstances or for any other reason. Investors are cautioned that all forward-looking statements involve risks and uncertainties, including those detailed in Fuel Tech's filings with the Securities and Exchange Commission.

------

**FUEL TECH, INC.**

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

---

| | | |
|:---|:---|:---|
|  | June 30, | December 31, |
|  | 2025 | 2024 |
| **ASSETS** |  |  |
| Current assets: |  |  |
| Cash and cash equivalents | $10589 | $8510 |
| Short-term investments | 12420 | 10184 |
| Accounts receivable, less current expected credit loss of $108 and $106, respectively | 6293 | 9368 |
| Inventories, net | 616 | 397 |
| Prepaid expenses and other current assets | 1093 | 1160 |
| Total current assets | 31011 | 29619 |
| Property and equipment, net of accumulated depreciation of $19,155 and $18,958, respectively | 4853 | 5084 |
| Goodwill | 2116 | 2116 |
| Other intangible assets, net of accumulated amortization of $543 and $525, respectively | 315 | 327 |
| Right-of-use operating lease assets, net | 578 | 585 |
| Long-term investments | 7925 | 10875 |
| Other assets | 205 | 191 |
| Total assets | $47003 | $48797 |
| **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |
| Current liabilities: |  |  |
| Accounts payable | $2124 | $2915 |
| Accrued liabilities: |  |  |
| Operating lease liabilities - current | 84 | 77 |
| Employee compensation | 743 | 1248 |
| Other accrued liabilities | 2375 | 1615 |
| Total current liabilities | 5326 | 5855 |
| Operating lease liabilities - non-current | 536 | 548 |
| Deferred income taxes, net | 176 | 176 |
| Other liabilities | 301 | 263 |
| Total liabilities | 6339 | 6842 |
| Stockholders' equity: |  |  |
| Common stock, $.01 par value, 40,000,000 shares authorized, 32,281,179 and 31,767,329 shares issued, and 31,074,438 and 30,708,273 shares outstanding, respectively | 322 | 317 |
| Additional paid-in capital | 165503 | 165295 |
| Accumulated deficit | (120900) | (119472) |
| Accumulated other comprehensive loss | (1769) | (1915) |
| Nil coupon perpetual loan notes | 76 | 76 |
| Treasury stock, at cost | (2568) | (2346) |
| Total stockholders' equity | 40664 | 41955 |
| Total liabilities and stockholders' equity | $47003 | $48797 |

---

See notes to condensed consolidated financial statements.

------

**FUEL TECH, INC.**

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Six Months Ended | Six Months Ended |
|  | June 30, | June 30, | June 30, | June 30, |
|  | 2025 | 2024 | 2025 | 2024 |
| **Revenues** | $5558 | $7042 | $11940 | $11999 |
| **Costs and expenses:** |  |  |  |  |
| Cost of sales | 3029 | 4090 | 6452 | 7018 |
| Selling, general and administrative | 3347 | 3245 | 6688 | 6590 |
| Research and development | 490 | 422 | 1060 | 798 |
|  | 6866 | 7757 | 14200 | 14406 |
| **Operating loss** | (1308) | (715) | (2260) | (2407) |
| Interest income | 537 | 334 | 816 | 645 |
| Other income (expense), net | 86 | (34) | 20 | 1639 |
| **Loss before income taxes** | (685) | (415) | (1424) | (123) |
| Income tax expense | (4) | (6) | (4) | (17) |
| **Net loss** | $(689) | $(421) | $(1428) | $(140) |
| **Net loss per common share:** |  |  |  |  |
| **Basic net loss per common share** | $(0.02) | $(0.01) | $(0.05) | $(0.00) |
| **Diluted net loss per common share** | $(0.02) | $(0.01) | $(0.05) | $(0.00) |
| **Weighted-average number of common shares outstanding:** |  |  |  |  |
| Basic | 30868000 | 30482000 | 30796000 | 30434000 |
| Diluted | 30868000 | 30482000 | 30796000 | 30434000 |

---

See notes to condensed consolidated financial statements.

------

**FUEL TECH, INC.**

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Six Months Ended | Six Months Ended |
|  | June 30, | June 30, | June 30, | June 30, |
|  | 2025 | 2024 | 2025 | 2024 |
| Net loss | $(689) | $(421) | $(1428) | $(140) |
| Other comprehensive income (loss): |  |  |  |  |
| Foreign currency translation adjustments | 11 | 5 | 146 | (138) |
| Comprehensive loss | $(678) | $(416) | $(1282) | $(278) |

---

See notes to condensed consolidated financial statements.

------

**FUEL TECH, INC.**

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

---

| | | |
|:---|:---|:---|
|  | Six Months Ended | Six Months Ended |
|  | June 30, | June 30, |
|  | 2025 | 2024 |
| **Operating Activities** |  |  |
| Net loss | $(1428) | $(140) |
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |  |  |
| Depreciation | 327 | 161 |
| Amortization | 18 | 31 |
| Non-cash interest income on held-to-maturity securities | (90) | (72) |
| Stock-based compensation, net of forfeitures | 212 | 228 |
| Changes in operating assets and liabilities: |  |  |
| Accounts receivable | 1987 | (334) |
| Employee retention credit receivable | 1232 | (1677) |
| Inventory | (218) | (24) |
| Prepaid expenses, other current assets and other non-current assets | 77 | 367 |
| Accounts payable | (833) | 524 |
| Accrued liabilities and other non-current liabilities | 203 | (1728) |
| Net cash provided by (used in) operating activities | 1487 | (2664) |
| **Investing Activities** |  |  |
| Purchases of equipment and patents | (101) | (204) |
| Purchases of debt securities | (4949) | (11107) |
| Maturities of debt securities | 5750 | 7000 |
| Net cash provided by (used in) investing activities | 700 | (4311) |
| **Financing Activities** |  |  |
| Taxes paid on behalf of award participants | (222) | (95) |
| Net cash used in financing activities | (222) | (95) |
| Effect of exchange rate fluctuations on cash | 114 | (104) |
| **Net increase (decrease) in cash and cash equivalents** | 2079 | (7174) |
| Cash and cash equivalents at beginning of period | 8510 | 17578 |
| **Cash and cash equivalents at end of period** | $10589 | $10404 |

---

See notes to condensed consolidated financial statements.

------

**FUEL TECH, INC.**

**Segment Data- Reporting Segments**

(in thousands)

Information about reporting segment net sales and gross margin from operations is provided below:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Air<br> Pollution | FUEL<br> CHEM |  |  |
| Three months ended June 30, 2025 | Control<br> Segment | Segment | Other | Total |
| Revenues from external customers | $2505 | $3053 | $— | $5558 |
| Cost of sales | (1406) | (1623) |  | (3029) |
| Gross margin | 1099 | 1430 |  | 2529 |
| Selling, general and administrative |  |  | (3347) | (3347) |
| Research and development |  |  | (490) | (490) |
| Operating income (loss) from operations | $1099 | $1430 | $(3837) | $(1308) |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Air<br> Pollution | FUEL<br> CHEM |  |  |
| Three months ended June 30, 2024 | Control<br> Segment | Segment | Other | Total |
| Revenues from external customers | $3949 | $3093 | $— | $7042 |
| Cost of sales | (2405) | (1685) |  | (4090) |
| Gross margin | 1544 | 1408 |  | 2952 |
| Selling, general and administrative |  |  | (3245) | (3245) |
| Research and development |  |  | (422) | (422) |
| Operating income (loss) from operations | $1544 | $1408 | $(3667) | $(715) |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Air<br> Pollution | FUEL<br> CHEM |  |  |
| Six months ended June 30, 2025 | Control<br> Segment | Segment | Other | Total |
| Revenues from external customers | $3808 | $8132 | $— | $11940 |
| Cost of sales | (2284) | (4168) |  | (6452) |
| Gross margin | 1524 | 3964 |  | 5488 |
| Selling, general and administrative |  |  | (6688) | (6688) |
| Research and development |  |  | (1060) | (1060) |
| Operating income (loss) from operations | $1524 | $3964 | $(7748) | $(2260) |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Air<br> Pollution | FUEL<br> CHEM |  |  |
| Six months ended June 30, 2024 | Control<br> Segment | Segment | Other | Total |
| Revenues from external customers | $6267 | $5732 | $— | $11999 |
| Cost of sales | (3833) | (3185) |  | (7018) |
| Gross margin | 2434 | 2547 |  | 4981 |
| Selling, general and administrative |  |  | (6590) | (6590) |
| Research and development | $— |  | (798) | (798) |
| Operating income (loss) from operations | $2434 | $2547 | $(7388) | $(2407) |

---

------

**FUEL TECH, INC.**

**Geographic Segment Financial Data**

*(*in thousands)

Information concerning our operations by geographic area is provided below. Revenues are attributed to countries based on the location of the end-user. Assets are those directly associated with operations of the geographic area.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Six Months Ended | Six Months Ended |
|  | June 30, | June 30, | June 30, | June 30, |
|  | 2025 | 2024 | 2025 | 2024 |
| Revenues: |  |  |  |  |
| United States | $4442 | $4471 | $9801 | $8066 |
| Foreign | 1116 | 2571 | 2139 | 3933 |
|  | $5558 | $7042 | $11940 | $11999 |

---

---

| | | |
|:---|:---|:---|
|  | June 30, | December 31, |
|  | 2025 | 2024 |
| Assets: |  |  |
| United States | $44130 | $44430 |
| Foreign | 2873 | 4367 |
|  | $47003 | $48797 |

---

------

**FUEL TECH, INC.**

RECONCILIATION OF GAAP NET LOSS TO EBITDA AND ADJUSTED EBITDA

(in thousands)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Three Months Ended | Three Months Ended | Six Months Ended | Six Months Ended |
|  | June 30, | June 30, | June 30, | June 30, |
|  | 2025 | 2024 | 2025 | 2024 |
| **Net Loss** | $(689) | $(421) | $(1428) | $(140) |
| Interest income | (537) | (334) | (816) | (645) |
| Income tax expense | 4 | 6 | 4 | 17 |
| Depreciation expense | 163 | 81 | 327 | 161 |
| Amortization expense | 9 | 15 | 18 | 31 |
| **EBITDA** | (1050) | (653) | (1895) | (576) |
| Stock compensation expense | 102 | 124 | 212 | 228 |
| Gain on employee retention credit |  |  |  | (1677) |
| **Adjusted EBITDA** | $(948) | $(529) | $(1683) | $(2025) |

---

**Adjusted EBITDA**

To supplement the Company's consolidated financial statements presented in accordance with generally accepted accounting principles in the United States (GAAP), the Company has provided an Adjusted EBITDA disclosure as a measure of financial performance. Adjusted EBITDA is defined as net income (loss) before interest expense, income tax expense (benefit), depreciation expense, amortization expense, stock compensation expense and gain on employee retention credit. The Company's reference to these non-GAAP measures should be considered in addition to results prepared in accordance with GAAP standards, but are not a substitute for, or superior to, GAAP results.

Adjusted EBITDA is provided to enhance investors' overall understanding of the Company's current financial performance and ability to generate cash flow, which we believe is a meaningful measure for our investor and analyst communities. In many cases non-GAAP financial measures are utilized by these individuals to evaluate Company performance and ultimately determine a reasonable valuation for our common stock. A reconciliation of Adjusted EBITDA to the nearest GAAP measure of net income (loss) has been included in the above financial table.