Company: CERO
Filing Date: 2025-08-22
Form Type: 424B3
Source: 0001213900-25-080017
Chunk: 58

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-08-22
Form: 424B3
Chunk 58
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les option-pricing model, and the Company determined that the aggregate total fair value of the January 2025 Common Warrants amounted to approximately $0.7 million, which were considered offering costs and were netted against the net proceeds received from the exercise of Series A Preferred Warrants under the guidance of ASU 2021-04. These offering costs are offset in additional paid-in capital with no impact on equity.

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Preferred Warrants

The 2,500 Preferred Warrants were initially exercisable for cash at an exercise price equal to $800. The exercise price was subject to adjustment for stock splits, combinations and similar events, and, in the event of stock dividends and splits, the number of shares of Series A Preferred Stock issuable upon the exercise of the Preferred Warrant will also be adjusted so that the aggregate exercise price shall be the same immediately before and immediately after any such adjustment.

We had the right, conditional upon the share price of CERO stock to be trading above $2,000.00 per share, to require the holders of Preferred Warrants to exercise such Preferred Warrants into up to an aggregate number of shares of Preferred Stock equal to the holder’s pro rata amount of 2,500 shares of Preferred Stock. In connection with the Series C PIPE Financing, we agreed with certain holders of the Preferred Warrants not to exercise such right to require such exercise by the holders thereof in consideration for their investment in the Series C PIPE Financing.

The Preferred Warrants prohibited us from entering into specified fundamental transactions unless the Successor assumes all of our obligations under the Preferred Warrants under a written agreement before the transaction is completed. Upon specified corporate events, a holder of the Preferred Warrants thereafter had the right to receive upon an exercise such shares, securities, cash, assets or any other property whatsoever which the holder would have been entitled to receive upon the happening of the applicable corporate event had the Preferred Warrant been exercised immediately prior to the applicable corporate event.

During the six months ended June 30, 2025, the 625 remaining Series
A Preferred Warrants were exercised into 625 shares of Series A Preferred Stock for gross proceeds of $500,000. During the six months
ended June 30, 2024, no Series A Preferred Warrants were exercised into shares of Series A Preferred Stock.

The Company’s Preferred Warrants were exercisable into Series A Preferred Stock, which had no cash redemption features that required liability treatment. The Company recorded the Preferred W