Company: PFSA
Filing Date: 2025-02-12
Form Type: S-4/A
Source: 0001213900-25-012354
Chunk: 338

Company: Profusa, Inc.
Filing Date: 2025-02-12
Form: S-4/A
Chunk 338
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 defined and driven by available cash from grants and other funding. Qualitatively, and based on management’s knowledge and understanding of the business, as described, Profusa expects that there will not be significant changes to assumptions of the timing of related milestones that would permit commercialization to begin, along with other assumptions (e.g., initial commercial revenues at launch, growth rate assumptions, weighted average cost of capital (WACC) and other applicable factors that would impact the valuation model (as originally developed in connection with the milestones at the time of the Merger Agreement in November 2022)). Since the Milestone Earnout Rights, Sponsor Inducement Recoupment Earnout Rights and Profusa Inducement Recoupment Earnout Rights are considered to be indexed to the New Profusa’s own stock, and because other criteria of ASC 815 Derivatives and Hedgingfor equity classification are met, these instruments are expected be classified as equity measured at fair value as at the date of the Merger, with no subsequent remeasurement at each reporting date. The issuance of Milestone Earnout Rights and Profusa Inducement Recoupment Earnout Rights to the equityholders of Profusa are expected to be treated as dividend distributions and recorded in additional paid -incapital. The preliminary estimated aggregate fair value of Milestone Earnout Rights and Profusa Inducement Recoupment Earnout Rights is $17.3 million, which was determined using Monte Carlo Simulation approach. The Company estimated the vesting and payoff of the Milestone Earnout Shares and the Inducement Shares related to Milestone I Event and Milestone II Event for each simulated stock price path, and the vesting and payoff of the Milestone Earnout Shares related to Milestone III Event and Milestone IV Event for each simulated revenue path and the correlated stock price path. The fair value is then determined by averaging the payoff across all simulated paths and discounting it to the valuation date. All outstanding capital stock of Profusa will be converted into shares of common stock of Profusa, with the corresponding increase in the par value of common stock being recognized against additional paid -incapital. All outstanding junior convertible notes and senior convertible notes are expected to convert into the shares of New Profusa based on their respective conversion teams. Accordingly, no gain or loss is expected to be recognized upon conversion of the junior convertible notes and senior convertible notes. Outstanding vested and unvested share -basedawards of Profusa will be converted into the right to exercise such awards for common