Company: CERO
Filing Date: 2025-08-22
Form Type: 10-Q
Source: 0001213900-25-079898
Chunk: 37

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-08-22
Form: 10-Q
Item: Item 1
Chunk 37
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 recorded a deemed dividend
of $5,750 and $24,500, which represents the fair value of excess common shares transferred to the preferred shareholders based on an average
per share common share price of $37.50, the effect of which was an increase in the net loss attributable to common shareholders in the
accompanying consolidated statement of operations for the three and six months ended June 30, 2025, respectively. Additionally, during
the three and six months ended June 30, 2025, the Company converted 175 shares of Series B Preferred stock at a conversion price lower
than the contractual conversion price of the Series B Preferred Stock. These shares were converted after the expiration of a prior Trigger
Event. The lower conversion price lowered the Series B Preferred Stock conversion price from the contractual conversion price to $1.76
per share. In connection with this down round triggering event, during the three and six months ended June 30, 2025, the Company recorded
a deemed dividend of $482,953, which represents the fair value of excess common shares convertible and issuable to the preferred shareholders
upon occurrence of the trigger event based on a per share common share price of $6.87, the effect of which was an increase in the net
loss attributable to common shareholders in the accompanying consolidated statement of operations for the three and six months ended June
30, 2025. As of the date of this triggering event and June 30, 2025, 60,338 common shares remain issuable to then holder of Series B Preferred.

As
of June 30, 2025, there were no remaining shares of Series B Preferred Stock.

17

Successor
Series C Convertible Preferred Stock

The
Company designated 2,853 shares of its authorized preferred stock as the Series C Preferred Stock and the rights, preferences and privileges
of the Series C Preferred Stock are summarized below.

Each
share of Series C Preferred Stock has a stated value of $1,000 per share and, when issued, the Series C Preferred Stock was fully paid
and non-assessable. The Series C Preferred Stock, ranks senior to all other Company capital stock unless required holder votes are obtained
to create a class of stock senior to Series C Preferred Stock.

Ranking:
The Series C Preferred Stock are senior in rank with respect to the preferences as to dividends, distributions and payments upon the
liquidation, dissolution and winding up of the Company to the Series A Convertible Preferred Stock