Company: AIRJW
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001013762-25-002263
Chunk: 701

Company: AirJoule Technologies Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 3
Chunk 701
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 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 other entity within other income/expense, which results in an increase or decrease to the
carrying value of our investment. If the share of losses exceeds the carrying value of our investment, we will suspend recognizing additional
losses and will continue to do so unless we commit to providing additional funding.

33

We evaluate our equity method investments for impairment whenever events
or changes in circumstances indicate that a decline in value has occurred that is other than temporary. Evidence considered in this evaluation
includes, but would not necessarily be limited to, the financial condition and near-term prospects of the investee, recent operating trends
and forecasted performance of the investee, market conditions in the geographic area or industry in which the investee operates and our
strategic plans for holding the investment in relation to the period of time expected for an anticipated recovery 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