Company: BCHT
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001477932-25-002237
Chunk: 72

Company: Birchtech Corp.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1
Chunk 72
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 value on a recurring basis by the Company at December 31, 2024 and December 31, 2023. The profit share liability is considered to be Level 3 measurements.  Financial instruments include cash, accounts receivable, accounts payable, and short-term debt. The carrying amounts of these financial instruments approximated fair value at December 31, 2024 and December 31, 2023 due to their short-term maturities.  The fair value of the notes payable at December 31, 2023 approximated the carrying amount, as the notes were recently issued at interest rates prevailing in the market. The fair value of the notes payable was determined on a Level 2 measurement. Discounts on issued debt, as well as debt issuance costs, are amortized over the term of the individual notes. At December 31, 2024, the fair value of the profit share liability is calculated using a discounted cash flow model based on estimated future cash payments. The fair value of the profit share liability at December 31, 2023 was also calculated using a discounted cash flow model based on estimated future cash payments. At December 31, 2024 and December 31, 2023, the fair value of the profit share liability was determined on a Level 3 measurement. These values are determined using pricing models for which the assumptions utilized management’s estimates. Significant unobservable inputs include a discount rate of approximately 14.55% and the projection of future cash flows.

 F-11Table of Contents

The following tables present the Company’s liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy.        Fair Value Measurement as of       December 31, 2024   Total  Level 1  Level 2  Level 3 Liabilities:                         Profit share liability – related party (1) $6,853,858  $-  $-  $6,853,858 Total Liabilities $6,853,858  $-  $-  $6,853,858      Fair Value Measurement as of      December 31, 2023   Total  Level 1  Level 2  Level 3 Liabilities:                         Profit share liability – related party (1) $14,847,937  $-