7. Related Party Transactions

In the normal course of business, the Company enters into various transactions with affiliated companies. Parties are considered to be related if one party has the ability to control or exercise significant influence over the other party in making financial or operating decisions.

The following tables summarize income and expenses from transactions with related parties for the three and six months ended  June 30, 2026 and 2025:

The following table summarizes assets and liabilities with related parties as of  June 30, 2026 and  December 31, 2025:

The material agreements whereby the Company generates revenues and expenses with affiliated entities are discussed below:

Investment Activity with GAMCO Investors, Inc.

Certain balances held and invested in various mutual funds are managed or advised by GAMCO Investors, Inc. or one of its subsidiaries (collectively, "GAMCO" or the "Fund Manager"), which is related to the Company through certain of our stockholders. Investments in related party mutual funds are overseen by the independent Audit Committee of the Board of Directors (the "Audit Committee"). The Audit Committee meets regularly to review the alternatives and has determined the current investments most reflect the Company's objective of lower cost, market return and adherence to having a larger proportion of underlying investments directly in United States Treasuries. For the three months ended  June 30, 2026 and 2025, the Company paid the Fund Manager a fund management fee of approximately 8 basis points per annum, respectively, of the asset balances under management. For the six months ended  June 30, 2026 and 2025, the Company paid the Fund Manager a fund management fee of approximately 8 basis points per annum, respectively, of the asset balances under management. The fund management fees are not paid directly by the Company and are deducted prior to a fund striking its net asset value ("NAV").

As of June 30, 2026, the balance managed by the Fund Manager totaled $41,536, all of which was classified within Cash and cash equivalents on the Condensed Consolidated Balance Sheets. As of December 31, 2025, the balance managed by the Fund Manager totaled $36,175, all of which was classified within Cash and cash equivalents on the Condensed Consolidated Balance Sheets.

For the three months ended June 30, 2026, the Company earned income on its investments managed by the Fund Manager totaling $370, all of which was included in Net investment income on the Condensed Consolidated Statements of Operations. For the three months ended June 30, 2025, the Company earned income on its investments managed by the Fund Manager totaling $366, all of which was included in Net investment income on the Condensed Consolidated Statements of Operations.

For the six months ended June 30, 2026, the Company earned income on its investments managed by the Fund Manager totaling $716, all of which was included in Net investment income on the Condensed Consolidated Statements of Operations. For the six months ended June 30, 2025, the Company earned income on its investments managed by the Fund Manager totaling $714, all of which was included in Net investment income on the Condensed Consolidated Statements of Operations.

Transactions with M-tron Industries, Inc.

Transitional Administrative and Management Services Agreement

On October 7, 2022, the separation of the M-tron Industries, Inc. ("MtronPTI") business from the Company was completed (the "Separation") and the business became an independent, publicly traded company trading on the NYSE American under the stock symbol "MPTI." The Separation was completed through the Company's distribution (the "Distribution") of 100% of the shares of MtronPTI's common stock to holders of the Company's common stock as of the close of business on September 30, 2022, the record date for the Distribution.

LGL Group and MtronPTI entered into an Amended and Restated Transitional Administrative and Management Services Agreement ("MtronPTI TSA"), which sets out the terms for services to be provided between the two companies post-separation. The current terms result in a net monthly payment of $4 per month to MtronPTI.

For the three months ended June 30, 2026 and 2025, the Company paid MtronPTI $12 under the terms of the MtronPTI TSA, which were recorded in Engineering, selling and administrative on the Condensed Consolidated Statements of Operations. For the six months ended June 30, 2026 and 2025, the Company paid MtronPTI $24 under the terms of the MtronPTI TSA, which were recorded in Engineering, selling and administrative on the Condensed Consolidated Statements of Operations.

Tax Indemnity and Sharing Agreement

LGL Group and MtronPTI entered into a Tax Indemnity and Sharing Agreement ("MtronPTI Tax Agreement"), which sets out the terms for which party would be responsible for taxes imposed on the Company if the distribution, together with certain related transactions, were to fail to qualify as a tax-free transaction under Internal Revenue Code ("IRC") Sections 355 and 368(a)(1)(D) if such failure were the result of actions taken after the Distribution by the Company or MtronPTI.

For the three and six months ended June 30, 2026 and 2025, no taxes related to the Distribution have been recorded in the Condensed Consolidated Financial Statements.

Other Transactions

LGL Group and MtronPTI have agreed to share salaries and benefits related to certain employees incurred by the LGL Group and/or Mtron. For the three and six months ended June 30, 2026, the Company reimbursed MtronPTI $28 and $56, respectively, of the salaries and benefits of certain employees. For the three months ended June 30, 2025, the Company reimbursed MtronPTI $10 of the salaries and benefits of certain employees. For the six months ended June 30, 2025, MtronPTI reimbursed the Company $16 of the salaries and benefits of certain employees.

Transactions with Alpha G Investment Management, Inc.

Alpha G Investment Management, Inc. ("Alpha G") is related to the Company through certain of our stockholders. LGL Group and Alpha G agreed to share salaries and benefits related to certain employees incurred by Alpha G. For the three and six months ended June 30, 2026, the Company reimbursed Alpha G $66 of the salaries and benefits of certain employees.

Skyline Instruments Corporation

In June 2026, Lynch Capital invested $850 in Skyline SPV, a special purpose vehicle formed to pool capital from investors and invest in the Skyline Note. As a result of this investment and the Company's role as investment advisor to Skyline SPV, the Company has the following related party relationships with respect to Skyline:

Investment Advisory Agreement

The Company serves as investment advisor to Skyline SPV pursuant to an Investment Advisory Agreement (the "Skyline IAA") between the Company and Skyline SPV. Under the Skyline IAA, the Company is responsible for all investment decisions with respect to Skyline SPV's assets, including decisions regarding the management, monitoring, conversion, disposition, and ultimate settlement of the Skyline Note. The Company has exclusive and unconditional authority to direct all activities that most significantly affect Skyline SPV's economic performance. As a result of this authority and the Company's equity interest in Skyline SPV held through Lynch Capital, the Company has determined that it is the primary beneficiary of Skyline SPV and consolidates Skyline SPV in its Condensed Consolidated Financial Statements. Refer to Note 6 - Variable Interest Entities for further information regarding the consolidation of Skyline SPV.

Board Seat at Skyline

Pursuant to a side letter agreement (the "Side Letter") between Skyline SPV and Skyline, Skyline SPV has the right to designate one member to Skyline's Board of Directors (the "Skyline Board"). The individual currently designated to serve on the Skyline Board pursuant to this right is the Company's chief executive officer. This individual serves on the Skyline Board in connection with Skyline SPV's investment in the Skyline Note and the related Side Letter rights, and their service as a Skyline Board member represents a related party relationship between the Company and Skyline given the Company's role as primary beneficiary and investment advisor of Skyline SPV.

The board seat carries rights equal to those of other members of the Skyline Board and confers no unilateral voting authority or veto rights at the board level. As established in the Company's VIE analysis, the board seat does not provide the Company or Skyline SPV with power to direct the activities that most significantly affect Skyline's economic performance, which are directed by Skyline's management in the ordinary course of Skyline's operations.