Company: AIRJW
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001013762-25-002263
Chunk: 1074

Company: AirJoule Technologies Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 6
Chunk 1074
---
 31, 2024 
  
    Subject Vesting Shares liability
    as of December 31, 2023 
    $— 
  
    Assumed
    in the Business Combination 
     11,792,000 
  
    Change
    in fair value 
     (3,973,000)
  
    Balance
    as of December 31, 2024 
    $7,819,000 

The
estimated fair value of the Subject Vesting Share liability was determined utilizing a Monte Carlo simulation, with underlying forecast
mathematics based on geometric Brownian motion in a risk-neutral framework. The calculation of the value of the Subject Vesting Shares
considered the $12.00 and $14.00 vesting conditions in addition to the vesting related to the Earnout Milestone Amount.

Items
Measured at Fair Value on a Nonrecurring Basis

In
addition to items that are measured at fair value on a recurring basis, the Company measures certain assets and liabilities at fair value
on a nonrecurring basis, which are not included in the table above. As these nonrecurring fair value measurements are generally determined
using unobservable inputs, these fair value measurements are classified within Level 3 of the fair value hierarchy. For further information
see Note 5 - Equity Method Investment.

F-29

Note 13
— COMMITMENTS AND CONTINGENCIES

The
Company is involved in various legal matters arising in the normal course of business. In the opinion of the Company’s management
and legal counsel, the amount of losses that may be sustained, if any, would not have a material effect on the financial position and
results of operations of the Company.

Risks
and Uncertainties

The
Company, as an early-stage business without any current operations, product sales or revenue, has historically been dependent upon the
sourcing of external capital to fund its overhead and product development costs. This is a typical situation for any early-stage company
without product sales to be in.

License
Agreement

In
October 2021, the Company entered into a patent license agreement with a third party whereby the third party granted the Company
rights to use certain of their patents in exchange for an upfront payment and royalties based on a percentage of net sales until such
patents expire. In connection with this, the Company agreed to a minimum royalty amount of which $0.3 million and $0.2 million was accrued
by the Company