Company: AIRJW
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001013762-25-002263
Chunk: 589

Company: AirJoule Technologies Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 2
Chunk 589
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.7 million
in Earnout Shares (as described in “-Earnout Shares Liability”) liability. The change in fair value of $29.2 million
for the year ended December 31, 2024 is due to a decrease in the estimated fair value of the liability and is recognized as a gain in
the consolidated statements of operations. The fair value of the liability decreased primarily due to changes in the valuation inputs,
mainly a decrease in the stock price, a change in the timing of future cash flows and an increase in the volatility.

Change in Fair Value of True Up Shares Liability

Upon consummation of the Business Combination, we assumed $0.6 million
in earnout true up shares liability. The change in fair value of $1.6 million for the year ended December 31, 2024 is due to a decrease
in our stock price. The increase in the estimated fair value of the liability was recognized as a loss in the consolidated statements
of operations.

Change in Fair Value of Subject Vesting Shares
Liability

Upon consummation of the Business Combination, we assumed $11.8 million
for the subject vesting shares liability. The change in fair value of income of $4.0 million during the year ended December 31, 2024 is
due to a decrease in the estimated fair value of the liability recognized as a gain in the consolidated statements of operations. The
fair value of the liability decreased primarily due to changes in the valuation inputs, mainly a decrease in the stock price, a change
in the timing of future cash flows and an increase in the volatility.

29

Gain on Settlement of Legal Fees

During the year ended December 31, 2024, we recognized a gain on the
settlement of legal fees related to the transaction costs of the Business Combination. There were no such gains in year ended December
31, 2023.

Income Tax Benefit (Expense)

Income tax expense was $81.3 million and $0 for the year ended
December 31, 2024 and 2023, respectively. During the year ended December 31, 2024, our contribution of a perpetual license to
AirJoule, LLC’s intellectual property was measured at fair value and resulted in a book gain and a temporary difference
between book and taxable income. The temporary difference resulted in the recognition of a deferred tax expense and deferred tax
liabilities. The deferred tax expense was partially offset by the recognition of deferred tax assets