Company: PFSA
Filing Date: 2025-07-18
Form Type: 8-K
Source: 0001213900-25-065686
Chunk: 38

Company: Profusa, Inc.
Filing Date: 2025-07-18
Form: 8-K
Chunk 38
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 adjusted their investment preferences generally. Key gauges of systemic risk, such as higher dollar funding
costs and counterparty credit spreads, have risen. There is a risk of a disorderly tightening of financial conditions that may be amplified
by vulnerabilities built over the years.

Principles of Accounting and Consolidation

The accompanying unaudited
condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United
States of America (“U.S. GAAP”) and pursuant to applicable rules and regulations of the Securities and Exchange Commission
(“SEC”) and include all adjustments necessary for the fair presentation of the Company’s financial position as of March
31, 2025 and March 31, 2024 and the results of operations and cash flows for the periods ended March 31, 2025 and December 31 2024. The
accompanying unaudited condensed consolidated financial statements include the accounts of Profusa, Inc. and its wholly owned subsidiary,
Profusa Asia Pacific Pte. Ltd (“APAC”). All intercompany balances and transactions have been eliminated in consolidation.

Components of Results of Operations

Government Grant Revenue

Government grant revenue consists
of amounts we earn under grants from two government agencies: NIH and DARPA. These grants are provided either in the form of expense reimbursement
(expense reimbursement grants) or on a fixed fee basis (fixed fee grants). Under the expense reimbursement grants the government agencies
reimburse us for a portion of our expenses (allowable expenses) that have been incurred in a given period on the basis of reports that
we provide to these agencies. Fixed fee grants are awarded for specific research and development programs undertaken by us. Under these
grants we receive milestone payments from the government agencies upon our submission and approval by the government of agreed upon deliverables,
consisting primarily of the documented results of the specific research and development programs.

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Research and Development Expenses

Research and development expenses
consist primarily of personnel expenses, including salaries, benefits, and stock-based compensation, costs of consulting, supplies, depreciation
and amortization and allocations of facility- related expenses. We expect our research and development expenses to increase as we increase
staffing to support product development, continue our clinical trials, build prototypes, and continue to explore and develop next generation
technologies.

General and Administrative Expenses

General and administrative
expenses consist of personnel expenses, including salaries, benefits, and stock-based compensation, related to executive management,