Company: AIRJW
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001013762-25-002263
Chunk: 865

Company: AirJoule Technologies Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 4
Chunk 865
---
 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
of all the Earnout Shares ($24.5 million and $53.7 million, respectively) represents 2,115,227 and 4,627,294 Earnout Shares, respectively.
The Earnout Shares liability in the preceding table represents the fair value of the contingent obligation to issue Earnout Shares to
Legacy Montana Equityholders (excluding the shares to employees accounted for under ASC 718) upon the achievement of certain Earnout Milestones.
For the year ended December 31, 2024, the change in the fair value of the earnout liability primarily relates to a decrease in the stock
price, changes in the timing of cash flows and an increase in the volatility.

True
Up Shares liability

As
discussed in Note 4 - Recapitalization, on