Company: CERO
Filing Date: 2025-11-20
Form Type: 424B3
Source: 0001213900-25-113118
Chunk: 70

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-11-20
Form: 424B3
Chunk 70
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 accounted
for under the measurement alternative in accordance with ASC 321, Investments – Equity Securities. Under this method,
the investment was initially recorded at cost, which was determined to be equal to the fair value of the consideration received, and is
subsequently adjusted for observable price changes in orderly transactions for the same or similar securities and for impairment, if any.
This non-cash transaction during the three months ended June 30, 2025 did not impact the Company’s
cash flows and is disclosed as a non-cash investing and financing activity in the condensed consolidated statement of cash flows in accordance
with ASC 230, Statement of Cash Flows.

The Company initially recorded
the earnout liability at estimated fair value using a Monte Carlo analysis and has revalued the earnout liability at each subsequent period.
The Monte Carlo analysis used the following assumptions:

|                             |     | September 30, 
 2025          |          |   |     | February 14   
 2024 to       
 September 30, 
 2024          |                        |
|:----------------------------|:----|:--------------|---------:|:--|:----|:--------------|:-----------------------|
|                             |     | -Successor    |          |   |     | -Successor    |                        |
| Starting share price        |     | $             |    14.60 |   |     |               | $180.00 to $9,800.00   |
| Tranche 1 trigger price     |     | $             | 2,500.00 |   |     |               | $2,500.00 to $6,400.00 |
| Tranche 2 trigger price     |     | $             | 3,000.00 |   |     |               | $3,000.00 to $7,700.00 |
| Contractual term (in years) |     |               |     2.40 |   |     |               | 3.40 to 4.00           |
| Volatility                  |     |               |      100 | % |     |               | 90%                    |
| Risk-free interest rate     |     |               |     3.82 | % |     |               | 3.52% to 4.33%         |

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The classification of the fair
value of the earnout liability and derivative liabilities and the change in the fair value measurement using significant