Company: PFSA
Filing Date: 2025-10-29
Form Type: 424B3
Source: 0001213900-25-103174
Chunk: 273

Company: Profusa, Inc.
Filing Date: 2025-10-29
Form: 424B3
Chunk 273
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 SUBSIDIARY
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS</div>

Note 2 — Summary of Significant Accounting Policies (cont.)

Research and Development

Research and development expenses
consist of costs related to employee compensation and benefits, costs for contract manufacturing organizations (“CMOs”), costs
for contract research organizations (“CROs”), costs for sponsored research, costs for clinical trials, consultant services,
laboratory supplies, product licenses, facility-related expenses and depreciation. All research and development costs are charged to research
and development expenses within the statements of operations as incurred. Payments associated with licensing agreements to acquire exclusive
licenses to develop, use, manufacture and commercialize products that have not reached technological feasibility and do not have alternate
commercial use are also expensed as incurred. Payments made to third parties under these arrangements in advance of the performance of
the related services by the third parties are recorded as prepaid expenses until the services are rendered.

Income Taxes

The Company accounts for income
taxes using the asset and liability method whereby deferred tax asset and liability accounts are determined based on differences between
financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are for the year
in which the differences are expected to affect taxable income. Valuation allowances are established where necessary to reduce deferred
tax assets to the amounts expected to be realized.

The Company accounts for uncertain
tax positions by assessing all material positions taken in any assessment or challenge by relevant taxing authorities. Assessing an uncertain
tax position begins with the initial determination of the position’s sustainability and is measured at the largest amount of benefit
that is greater than fifty percent likely of being realized upon ultimate settlement. The Company’s policy is to recognize interest
and penalties related to the underpayment of income taxes as a component of income tax expense or benefit. The Company recognizes interest
and penalties related to unrecognized tax benefits within the income tax expense line. Accrued interest and penalties are included within
the Accrued liabilities in the balance sheets. To date, there have been no interest or penalties charged in relation to the unrecognized
tax benefits.

Net Loss per Share Attributable to Common Stockholders

Basic net loss per common
share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock
outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per share is computed by dividing
the net loss attributable to common stockholders by the