Company: CERO
Filing Date: 2025-08-22
Form Type: 10-Q
Source: 0001213900-25-079898
Chunk: 187

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-08-22
Form: 10-Q
Item: Item 8
Chunk 187
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 Warrants and January 2025 Common Warrants are exercisable into Common Stock, which has no cash redemption
features that require liability treatment. The Company has recorded the December 2024 Common Warrants and January 2025 Common Warrants
as equity.

On
December 23, 2024, in connection with the issuance of the December 2024 Warrants, the Company calculated the fair value of such warrants
using the Black-Scholes option-pricing model, and the Company determined that the aggregate total fair value of the December 2024 Warrants
amounted to approximately $0.3 million, which were considered offering costs and were netted against the net proceeds received from the
exercise of Series A Preferred Warrants under the guidance of ASU 2021-04. These offering costs are offset in additional paid-in capital
with no impact on equity.

On
January 6, 2025, in connection with the issuance of the January 2025 Common Warrants, the Company calculated the fair value of such warrants
using the Black-Scholes option-pricing model, and the Company determined that the aggregate total fair value of the January 2025 Common
Warrants amounted to approximately $0.7 million, which were considered offering costs and were netted against the net proceeds received
from the exercise of Series A Preferred Warrants under the guidance of ASU 2021-04. These offering costs are offset in additional paid-in
capital with no impact on equity.

25

Preferred
Warrants

The
2,500 Preferred Warrants were initially exercisable for cash at an exercise price equal to $800. The exercise price was subject to adjustment
for stock splits, combinations and similar events, and, in the event of stock dividends and splits, the number of shares of Series A
Preferred Stock issuable upon the exercise of the Preferred Warrant will also be adjusted so that the aggregate exercise price shall
be the same immediately before and immediately after any such adjustment.

We
had the right, conditional upon the share price of CERO stock to be trading above $2,000.00 per share, to require the holders of Preferred
Warrants to exercise such Preferred Warrants into up to an aggregate number of shares of Preferred Stock equal to the holder’s
pro rata amount of 2,500 shares of Preferred Stock. In connection with the Series C PIPE Financing, we agreed with certain holders of
the Preferred Warrants not to exercise such right to require such