Company: PFSA
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112723
Chunk: 39

Company: Profusa, Inc.
Filing Date: 2025-11-19
Form: 10-Q
Item: Part I, Item 1
Chunk 39
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parties’ decision to extend thereafter. Upon occurrence of certain events of default by the Company, including failure to repay
in full the amounts owed at maturity, the lender will have an option to convert the entire outstanding balance and accrued but unpaid
interest under the Convertible debt into senior unsecured promissory notes on substantially the same terms as the outstanding Senior Notes.
In the event the Company fails to complete the formation of the APAC Joint Venture or fail to repay the amounts under the Tasly Convertible
Debt when they become due, the lender will have an option to convert the entire outstanding balance and accrued but unpaid interest under
the Convertible debt into either (i) senior unsecured promissory notes on substantially the same terms as the outstanding Senior Notes
as of September 30, 2025, $0.50 per share, or (ii) the Company’s Common Stock at a conversion price of $1.92 per share.

22

The Company elected to apply the fair value option to account for the
Tasly Convertible debt. Accordingly, no features of the Convertible debt are bifurcated and separately accounted for. As of September
30, 2025 and 2024, the fair value of the Convertible debt was $2.1 million and $1.7 million, respectively. On September 30, 2025, the
remaining time event was 0 months as the APAC JV can effectively close now that the Closing has occurred. The intrinsic conversion value
as of the Valuation Date, September 30, 2025, is zero and the note is in default as the maturity date has passed.  The fair value
of the note is the face amount of the debt plus accrued interest which is recorded as a liability above the face amount of the debt and
is recorded as a current liability on the Condensed Consolidated Balance Sheet.

Senior Convertible Notes

January-March 2024 Senior Notes — During the months
January through March 2024, the Company issued additional Senior Notes to investors with the principal amount of $0.7 million on substantially
the same terms as the Senior Notes issued in 2022 (as amended in November 2022).

April - June 2024 Senior Notes — During the months
April through June 2024, the Company issued additional Senior Notes to investors with the principal amount of $0.4 million on substantially
the same terms as the Senior Notes issued in 2022 (as amended