Company: CERO
Filing Date: 2025-02-07
Form Type: 424B3
Source: 0001213900-25-011071
Chunk: 426

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-02-07
Form: 424B3
Chunk 426
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 incentive stock option is estimated using the simplified method described in Staff Accounting Bulletin Topic 14 – Share-Based            
 Payment. All incentive stock options awarded by the Company have terms consistent with this approach, which is to calculate the weighted 
 average midpoint between the vesting date of each vesting tranche and the termination date of the option. Non-qualified stock options    
 are valued using the contractual life as the expected term.                                                                              |

For the year ended December 31, 2023, the
Company recorded stock-based compensation expense of $96,896, of which $91,664 was related to R&D and $5,232 was related to general
and administrative.

For the year ended December 31, 2022, the
Company recorded stock-based compensation expense of $381,070, of which $294,164 was related to R&D and $86,906 was related to general
and administrative.

As of December 31, 2023, there was $79,526
of unamortized stock-based compensation cost related to unvested stock options, which is expected to be recognized over a weighted average
period of 1.05 years. No options were granted in 2023, and the weighted average grant date calculated fair value per share of options
granted during the year ended December 31, 2022, was $0.50.

NOTE 11 – INCOME TAXES

The components of the net deferred tax assets were approximately as
follows as of December 31, 2023 and 2022:

|                                                     |     |   |        2023 |   |     |   |       2022 |   |
|:----------------------------------------------------|:----|:--|------------:|:--|:----|:--|-----------:|:--|
| Net operating loss carryforwards                    |     | $ |   9,067,000 |   |     | $ |  5,600,000 |   |
| Section 174 research and development capitalization |     |   |   2,490,000 |   |     |   |  1,807,000 |   |
| Research credits                                    |     |   |   1,535,000 |   |     |   |  1,364,000 |   |
| Fixed assets and intangible assets                  |     |   |     401,000 |   |     |   |    321,000 |