Company: AIRJW
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001013762-25-002263
Chunk: 150

Company: AirJoule Technologies Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 1
Chunk 150
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 fair value at the acquisition date, and on each balance sheet date thereafter.
Changes in the estimated fair value of liability-classified contingent consideration are recognized on the consolidated statements of
operations in the period of change.

Several valuation methods may be used to determine the fair value of
assets acquired and liabilities assumed. For intangible assets, we typically use a variation of the income approach, whereby a forecast
of future cash flows attributable to the asset is discounted to present value using a risk-adjusted discount rate. Some of the more significant
estimates and assumptions inherent in the income approach include the amount and timing of projected future cash flows, the discount rate
selected to measure the risks inherent in the future cash flows, and the assessment of the asset’s expected useful life. When
the initial accounting for a business combination has not been finalized by the end of the reporting period in which the transaction occurs,
we report provisional amounts. Provisional amounts are adjusted during the measurement period, which does not exceed one year from the
acquisition date. These adjustments, or recognition of additional assets or liabilities, reflect new information obtained about facts
and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date.

Equity Method Investment

In accordance with ASC 323, Investments - Equity Method and
Joint Ventures, investments in entities over which we do not have a controlling financial interest but has significant influence are
accounted for using the equity method, with our share of earnings or losses reported in earnings or losses from equity method investments
on the statements of operations.

Under the equity method of accounting, our investment is initially
recorded at fair value on the consolidated balance sheets. Upon initial investment, we evaluate whether there are basis differences between
the carrying value and fair value of our proportionate share of the investee’s underlying net assets. Typically, we amortize basis
differences identified on a straight-line basis over the underlying assets’ estimated useful lives when calculating the attributable
earnings or losses, excluding the basis differences attributable to in-process research and development and goodwill. If we are unable
to attribute all of the basis differences to specific assets or liabilities of the investee, the residual excess of the cost of the investment
over the proportional fair value of the investee’s assets and liabilities is considered to be equity method goodwill and is recognized
within the equity investment balance, which is tracked separately within our memo accounts. We subsequently record in the statements of
operations our share of income or loss of the