Company: AIRJW
Filing Date: 2025-05-05
Form Type: 424B3
Source: 0001213900-25-039770
Chunk: 97

Company: AirJoule Technologies Corp.
Filing Date: 2025-05-05
Form: 424B3
Chunk 97
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 statements, we will recognize its share of the impairment in its financial statements
in the same manner in which it recognizes other earnings of the investee.

Warrants

We determine the accounting classification of
warrants issued as either liability or equity classified by first assessing whether the warrants meet liability classification in accordance
with ASC 480-10, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, or ASC 480,
then in accordance with ASC 815-40, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock, or ASC 815. In order for a warrant to be classified in stockholders’ deficit, the warrant must
be (i) indexed to our equity and (ii) meet the conditions for equity classification.

If a warrant does not meet the conditions for
stockholders’ deficit classification, it is carried on the consolidated balance sheets as a warrant liability measured at fair value,
with subsequent changes in the fair value of the warrant recorded in other non-operating losses (gains) in the consolidated statements
of operations. If a warrant meets both conditions for equity classification, the warrant is initially recorded, at its relative fair value
on the date of issuance, in stockholders’ deficit in the consolidated balance sheets, and the amount initially recorded is not subsequently
remeasured at fair value.

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Income Taxes

Prior to the Business Combination on March 14,
2024, we were a limited liability company, or LLC, and treated as a partnership for income tax purpose. As a Partnership, we were not
directly liable for federal income taxes. As of the date of the Business Combination, the operations of the Company ceased to be taxed
as a partnership resulting in a change in tax status for federal and state income tax purposes.

We follow the asset and liability method of accounting
for income taxes under ASC 740, Income Taxes, or ASC 740. Deferred tax assets and liabilities are measured using enacted
tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that is included in the
enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC 740 prescribes a recognition threshold
and a measurement attribute for the financial statement recognition and measurement of tax