Company: CERO
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-044335
Chunk: 62

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 1
Chunk 62
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-funded warrants and warrants
to purchase shares of common stock that closed on February 7, 2025 (the “February 2025 Offering”). As a result of such capital
raising activities and the proceeds of the Private Placement received on the First Closing Date, as well as successful negotiations with
certain service providers to reduce outstanding balances payable, the Company received a notification letter from Nasdaq on May 7, 2025,
stating that the Company to have regained compliance with the Nasdaq continued listing standard under Nasdaq Listing Rule 5550(b)(1),
which requires, among other things, that the Company maintain at least $2.5 million in stockholders’ equity.

Results of Operations

Revenue

Predecessor and the Company
have not recognized any revenue from any sources, including from product sales, and the Company does not expect to generate any revenue
from the sale of products in the foreseeable future. If the development efforts for the Company’s product candidates, each of which
is a specific product and indication combination, are successful and result in regulatory approval, or if the Company executes license
agreements with third parties, the Company may generate revenue from R&D services, from the achievement of development milestones
or from milestones and royalties related to product sales. However, there can be no assurance as to when any revenues will be generated,
if at all.

32

Operating Expenses

Research and Development Expenses

R&D expenses consist
of discovery activities, manufacturing development and production, preclinical and clinical development, and regulatory filing for product
candidates. R&D expenses are recognized as incurred and payments made prior to the receipt of goods or services to be used in R&D
are capitalized until the goods or services are received. Costs incurred in obtaining technology licenses through asset acquisitions,
if incurred, will be charged to R&D expense if the licensed technology has not reached technological feasibility and has no alternative
future use. R&D expenses include or could include:

●employee-related
expenses, including salaries, bonuses, benefits, stock-based compensation and other related costs for those employees involved in R&D
efforts;

●external
R&D expenses incurred under agreements with preclinical research organizations, clinical research organizations, investigative sites,
centralized clinical laboratories, and consultants to conduct preclinical and clinical studies;

●costs
related to manufacturing material for preclinical studies and clinical trials, including fees paid to contract development and manufacturing
organizations;

●product-liability
insurance for clinical development product(s);

●laboratory
supplies and