Company: CERO
Filing Date: 2025-02-07
Form Type: 424B3
Source: 0001213900-25-011071
Chunk: 336

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-02-07
Form: 424B3
Chunk 336
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 as
a result of such multiplier, such registration statement registered fewer than the maximum number of shares of Common Stock issuable
upon such conversion.

Redemptions: Upon bankruptcy or liquidation,
Series A Preferred Stock will be redeemed at a 25% premium (50% premium after 180 days after issuance) to the greater of the conversion
amount or the number of shares multiplied by the highest closing price within the preceding 20 days. Additionally, the Company may voluntarily
redeem the Series A Preferred Stock as at 20% premium to the greater of the conversion amount or the number of shares multiplied by the
highest closing price within the preceding 20 days.

The holders of the Series A Preferred Stock have
no voting rights.

In February 2024, the Company consummated a private
placement (the “Series A PIPE Financing”) of 10,039 shares of Series A Preferred Stock, warrants to purchase 6,127 shares
of Common Stock (the “February 2024 PIPE Common Warrants”) and warrants to purchase 2,500 shares of Series A Preferred Stock
(the “Preferred Warrants”) (See Note 8 below), pursuant to the Amended and Restated Securities Purchase Agreement, dated
February 14, 2024, by and among the Company, PBAX and certain accredited investors (the “Initial Investors”) for aggregate
cash proceeds to the Company of approximately $10.0 million, including cash previously received for bridge loan proceeds.

A portion of such Series A Preferred Stock was
issued as consideration for the cancellation of outstanding indebtedness, including a promissory note of PBAX amounting to $1,555,000
and the Predecessor’s convertible notes amounting to $627,154.

The Company accounts for preferred stock as either
equity or debt-like securities based on an assessment of the Preferred Stock rights and preferences and applicable authoritative guidance
in ASC 480 and ASC 815, Derivatives and Hedging. The Company has concluded that the Series A and Series B Preferred Stock, which have
no cash redemption features outside of the Company’s control are treated as equity. The Company has also concluded that the Series
A Common Warrants do not possess redemption features outside of the Company’s control and are treated as equity.

Due to delayed filing and declaration of effectiveness
relative to the deadlines defined in the Registration Rights Agreement, the Company accrued for an aggregate $608,363 penalty as of June
30, 2024, payable in cash to the