Company: AIRJW
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001013762-25-002263
Chunk: 286

Company: AirJoule Technologies Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 1A
Chunk 286
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 of its carrying value.
If the investment is determined to have a decline in value deemed to be other than temporary it is written down to estimated fair value.

Additionally, if an equity method investee recognizes a goodwill impairment
charge in its separate financial 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.

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