Company: AIRJW
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001013762-25-002263
Chunk: 659

Company: AirJoule Technologies Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 2
Chunk 659
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 distribution of potential outcomes for
expected EBITDA and stock price at expected commission dates, utilizing a correlation coefficient for EBITDA and stock price, and assuming
$50.0 million of Annualized EBITDA per production line, with each of the production lines commissioned over a five-year period. EBITDA
was discounted to the valuation date with a weighted average cost of capital estimate and forecasted to each estimated commission date.
Earnout mechanics at each estimated commission date were assessed, and if the Earnout Thresholds were achieved, the future value of the
Earnout Shares was discounted to the valuation date utilizing a risk-free rate commensurate with the overall term. The commission dates
used reflected XPDB’s management’s best estimates regarding the time to complete full construction and operational viability
of a production line, including all permitting, regulatory approvals and necessary or useful inspections. The Earnout term of 5 years
and the Earnout mechanics which impact the timing of future cash flows represent contractual inputs. Assumptions such as risk-free rate,
stock price, volatility, and discount rate were based on market data. See the following summary of key inputs:

    As
    of December 31, 2024  
    As
    of March 14, 2024 
  
    Stock Price (1) 
    $7.97  
    $10.00 
  
    Volatility 
     40% 
     35%
  
    Risk free
    rate of return 
     4.30% 
     4.24%
  
    Expected
    term (in years) 
     4.2  
     5.0 

  (1) At March 14, 2024, the $10.00 price represents the Business Combination price. 

The
following table presents the changes in the fair value of the Earnout Shares liability: 

    Year
    Ended December 31, 2024 
  
    Earnout Shares Liability as
    of December 31, 2023 
    $— 
  
    Expensed
    as transaction costs of business combination 
     53,721,000 
  
    Change
    in fair value 
     (29,197,000)
  
    Balance
    as of December 31, 2024 
    $24,524,000 

As of December 31, 2024 and March 14, 2024, the estimated fair value