Company: CERO
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112619
Chunk: 37

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-11-19
Form: 10-Q
Item: Item 1
Chunk 37
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 value of excess common stock convertible
and issuable to the preferred shareholders upon occurrence of the trigger event based on an average per share common share price of $95.00,
the effect of which was an increase in the net loss attributable to common shareholders in the accompanying condensed consolidated statement
of operations for the nine months ended September 30, 2025, and 2) for 625 shares of Series A Preferred Stock converted after the expiration
of a Trigger Event as described above, the Company recorded a stock-based inducement expense of $156,250, which represents the fair value
of excess common stock transferred to the preferred shareholders based on an average per share common share price of $95.00 and is reflected
as part of other income (expense), net, on the accompanying condensed consolidated statement of operations for the nine months ended September
30, 2025. Additionally, during the three and nine months ended September 30, 2025, Series C Preferred Stock was converted by investors
at a conversion price lower than the conversion price of the Series A Preferred Stock then in effect. The lower conversion price lowered
the Series A Preferred Stock conversion price from $39.20 per share to $1.76 per share. In connection with this down round triggering
event, during the three and nine months ended September 30, 2025, the Company recorded a deemed dividend of $14,871,551, which represents
the fair value of excess common stock convertible and issuable to the preferred shareholders upon occurrence of the trigger event based
on an average per share common share price of $19.18, the effect of which was an increase in the net loss attributable to common shareholders
in the accompanying condensed consolidated statement of operations for the three and nine months ended September 30, 2025,

Additionally, certain investors
are owed an aggregate of 692 shares of Common Stock of the Company due to shortfall in number of shares issued upon conversion, which
represents the 25% premium not received during the year ended December 31, 2024. Accordingly, during the year ended December 31, 2024,
the Company reduced additional paid-in capital by $85,500 and recorded a liability of $85,500, which is reflected on the accompanying
condensed consolidated balance sheets as deemed dividend - common stock liability as of September 30, 2025 and December 31, 2024.

As of September 30, 2025,
there were 1,429 remaining