Company: SIDU
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001641172-25-001742
Chunk: 256

Company: Sidus Space Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1B
Chunk 256
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 tax assets
and liabilities are individually classified as current and non-current based on their characteristics. Deferred tax assets are reduced
by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax
assets will not be realized. No deferred tax assets or liabilities were recognized as of December 31, 2024 or December 31, 2023.

Warrants

The Company accounts for warrants as either equity-classified
or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance
in FASB ASC 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”).
The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability
pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether
the warrants are indexed to the Company’s own ordinary shares and whether the warrant holders could potentially require “net
cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This
assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly
period end date while the warrants are outstanding.

For issued or modified warrants that meet all of
the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the
time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required
to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated
fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The fair value of the warrants
was estimated using a Black-Scholes pricing model.

     F-12 

Recent Accounting Pronouncements

In June 2022, the FASB issued ASU 2022-03, ASC Subtopic
“Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions”.
These amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account
of the equity security and, therefore, is not considered in measuring fair value. The amendments in this