Company: PFSA
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001013762-25-004396
Chunk: 620

Company: Profusa, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 2
Chunk 620
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 the host contract. The valuation
technique requires inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect management’s
own assumption about the assumptions a market participant would use in pricing the working capital loan.

F-21

The convertible promissory note was classified
within Level 3 of the fair value hierarchy due to the use of unobservable inputs. Inherent in pricing models are assumptions related to
expected share-price volatility, expected life and risk-free interest rate. The Company estimates the volatility of its common stock based
on historical volatility that matches the expected remaining life of the note. The risk-free interest rate is based on the U.S. Treasury
zero-coupon yield curve on the grant date for a maturity similar to the expected remaining life of the note. The expected life of the
note is assumed to be equivalent to their remaining contractual term.

Note
9 – Income Taxes

The
Company’s net deferred tax assets are as follows:

    December 31, 2024  
    December 31, 2023 
  
    Deferred tax asset/(liability) 

    Organizational costs/Startup expenses 
    $            694,480  
    $            436,196 
  
    Unrealized gain/loss - Trust 
     —  
     (13,661)
  
    Net deferred tax asset 
     694,480  
     422,535 
  
    Valuation allowance 
     (694,480) 
     (436,196)
  
    Deferred tax (liability), net of allowance 
    $—  
    $(13,661)

The
income tax provision consists of the following:

    For the Year Ended December 31, 2024  
    For the Year Ended December 31, 2023 
  
    Federal 

    Current 
    $            94,174  
    $            480,069 
  
    Deferred 
     (271,945) 
     (226,991)
  
    State 
     —  
     — 
  
    Change in valuation allowance 
     258,284  
     203,712 
  
    Income tax provision 
    $80,513  
    $456,790 

As
of December 31, 2024 and 2023, the Company had $0 in U.S. federal net operating loss carryovers available to offset future