Company: CERO
Filing Date: 2025-08-22
Form Type: 10-Q
Source: 0001213900-25-079898
Chunk: 431

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-08-22
Form: 10-Q
Item: Part II, Item 1
Chunk 431
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 in connection with breaches other
than the breach of the requirement to redeem the shares of Series A Preferred Stock and Series B Preferred Stock by August 19, 2025, which
results in a 50% premium, and the addition to the stated value of an amount equal to the value of the shares of Common Stock into which
the Series A Preferred Stock or Series B Preferred Stock would have been convertible if the conversion price were equal to 80% of the
lowest volume weighted average price during the five trading days immediately prior to conversion. Such penalties and adjustments, which
applied during the period when substantially all of the conversions since the Business Combination occurred as a result of a failure to
file and cause the SEC to declare a registration statement with respect to the resale of the underlying shares in a timely manner, have
resulted and may in the future result in the issuance of shares of Common Stock at an effective conversion price below the trading price
of our Common Stock at the time of such conversion.

We
cannot assure you that we will remain in compliance with all of the terms of the Series A Preferred Stock, Series C Preferred Stock or
Series D Preferred Stock and that such penalties and adjustments will not apply in the future. In addition, we cannot assure you that
we will not issue additional convertible or other derivative securities with highly dilutive penalty or adjustment provisions. As described
elsewhere in this Quarterly Report, the Company needs to obtain financing to fund its research and development activities and clinical
trials, as well as other operations. Under challenging conditions in the equity capital markets, particularly for pre-commercialization
biotech companies, we may have no viable alternatives to agreeing to inclusion of such provisions in the terms of future financings.

The
                                            impact of recent healthcare reform legislation and other changes in the healthcare industry
                                            and in healthcare spending on us is currently unknown, and may adversely affect our business
                                            model.

Our
revenue prospects could be affected by changes in healthcare spending and policy in the United States and abroad. We operate in a highly
regulated industry and new laws, regulations or judicial decisions, or new interpretations of existing laws, regulations or decisions,
related to healthcare availability, the method of delivery or payment for healthcare products and services could negatively impact our
business, operations and financial condition.

There have been, and likely
will continue to be, legislative and regulatory proposals at the foreign, federal and state levels directed at broadening the availability
of healthcare and containing or lowering the cost of healthcare. For