Company: PFSA
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001013762-25-004396
Chunk: 148

Company: Profusa, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1
Chunk 148
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 for the 17,404,250 warrants issued in connection with the IPO (the 9,487,500 Public Warrants, the 7,347,500 Private
Placement Warrants, and the 569,250 Representative Warrants inclusive of the underwriters’ over-allotment option)
in accordance with the guidance contained in ASC 815-40. Such guidance provides that because the warrants do not meet the criteria for
equity treatment thereunder, each warrant must be recorded as a liability. Accordingly, the Company has classified each warrant as a
liability at its fair value. This liability is subject to re-measurement at each balance sheet date. With each such re-measurement,
the warrant liabilities will be adjusted to fair value, with the change in fair value recognized in the Company’s consolidated
statements of operations (See Note 8).

In
determining the fair value of the Private Placement Warrants and the Representative’s Warrants, assumptions related to expected
share-price volatility, expected life and risk-free interest rate are utilized. The Company estimates the volatility of its common stock
based on historical volatility that matches the expected remaining life of the warrants.

Net
(Loss) Income Per Common Stock

The
Company has two categories of shares, which are referred to as common stock subject to possible redemption and common stock. Earnings
and losses are shared pro rata between the two categories of shares. The 17,404,250 potential shares of common stock for outstanding
warrants to purchase the Company’s shares were excluded from diluted earnings per share for the years ended December 31, 2024 and
2023 because the warrants are contingently exercisable, and the contingencies have not yet been met. As a result, diluted net (loss)
income per share of common stock is the same as basic net (loss) income per share of common stock for the periods presented. The
table below presents a reconciliation of the numerator and denominator used to compute basic and diluted net (loss) income per share
for each category of common stock:

    For the Year Ended December 31, 2024  
    For the Year Ended December 31, 2023 

    Common stock subject to possible redemption  
    Common stock  
    Common stock subject to possible redemption  
    Common stock 
  
    Basic and diluted net (loss) income per share: 

    Numerator: 

    Allocation of net (