Company: CERO
Filing Date: 2025-08-22
Form Type: 10-Q
Source: 0001213900-25-079898
Chunk: 33

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-08-22
Form: 10-Q
Item: Item 1
Chunk 33
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 the Alternate Conversion Price had
been equal to such lower volume weighted average price. Such multiplier was in effect from when the registration statement for the resale
of shares of Common Stock issuable upon conversion of the Series A Preferred Stock was declared effective on July 5, 2024 because such
effectiveness was after the applicable deadline therefore and, as a result of such multiplier, such registration statement registered
fewer than the maximum number of shares of Common Stock issuable upon such conversion. Such multiplier ceased to apply on January 6,
2025, the 20th trading day after the effectiveness of the additional registration statement registering the resale of additional
shares of Common Stock issuable upon conversion of the Series A Preferred Stock resulting from such shortfall, which additional registration
statement was declared effective on December 5, 2024.

Redemptions:
Upon bankruptcy or liquidation, Series A Preferred Stock will be redeemed at a 25% premium (or at 50% premium 180 days after issuance)
to the greater of the conversion amount or the number of shares multiplied by the highest closing price within the preceding 20 days.
Additionally, the Company may voluntarily redeem the Series A Preferred Stock at a 20% premium to the greater of the conversion amount
or the number of shares multiplied by the highest closing price within the preceding 20 days.

The
holders of the Series A Preferred Stock have no voting rights.

In
February 2024, the Company consummated a private placement (the “Series A PIPE Financing”) of 10,089 shares of Series A Preferred
Stock, warrants to purchase 306 shares of Common Stock (the “February 2024 PIPE Common Warrants”) and warrants to purchase
2,500 shares of Series A Preferred Stock (the “Preferred Warrants”) (See Note 9 below), pursuant to the Amended and Restated
Securities Purchase Agreement, dated February 14, 2024, by and among the Company, PBAX and certain accredited investors for aggregate
cash proceeds to the Company of approximately $10.0 million, including cash previously received for convertible bridge note proceeds.

A
portion of such Series A Preferred Stock was issued as consideration for the cancellation of outstanding indebtedness, including a promissory
note of PBAX amounting to $1,555,000 and the Predecessor’s convertible bridge notes amounting to $627,154.

The Company accounts for preferred stock as either equity or debt-like
securities based on an assessment of the Preferred Stock