Company: CERO
Filing Date: 2025-07-21
Form Type: S-1
Source: 0001213900-25-066152
Chunk: 392

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-07-21
Form: S-1
Chunk 392
---
0.0% is based on the expectation of no dividend 
 payouts to Common Stock.                                                                               |

| ● | The risk-free interest rate assumption is based on the U.S. Department of Treasury instruments whose term 
 was most consistent with the expected life of the Company’s stock options.                                |

| ● | The expected stock price volatility assumption was determined by examining the historical volatilities                                 
 for industry peers, as the Company does not have sufficient public trading history for the Company’s Common Stock. The Company will    
 continue to analyze the historical stock price volatility and expected term assumption as more historical price data for the Company’s 
 Common Stock becomes available.                                                                                                        |

F-58

| ● | The expected lives of the Company’s stock options are estimated based on the type of award issued                                            
 using approaches that do not rely on the historical data of the Company, as management has concluded there is insufficient data to provide   
 a reasonable forward-looking estimate. The expected life of an 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.                                  |

There were
no stock options granted by the Predecessor during the year ended December 31, 2023.

|                          |     |   December 31, |   |
|                          |     |           2024 |   |
|                          |     |     -Successor |   |
| Risk-free interest rate  |     |          3.75% 
        to 4.89 | % |
| Expected life (in years) |     |            5.0 
         to 7.0 |   |
| Expected dividend yield  |     |              - | % |
| Expected volatility      |     | 62.4% to 106.6 | % |

For the period from February 14, 2024 through December 31, 2024, the
Company recorded stock-based compensation expense of $, of which $ was related to research and development and $
was related to general and administrative. For the period from January 1, 2024 through February 13, 2024, Predecessor recorded an immaterial
amount of stock-based compensation expense.

For the year