Company: CERO
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-044335
Chunk: 52

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 1
Chunk 52
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under the 2024 Plan on April 30, 2024, and November 11, 2024. The 2024 Plan has an evergreen provision for annual increases. On January
1, 2025, the reserve increased by 189,701 shares. As of March 31, 2025, 471,199 option awards have been granted, leaving no shares reserved
for future issuance.

The 2024 ESPP also has an evergreen provision.
On January 1, 2025, the reserve increased by 10,198 shares. No awards have been granted under the 2024 ESPP as of March 31, 2025.

Stock option activity under
the 2024 Plan for the three months ended March 31, 2025 was as follows:

             Weighted          Weighted   Average          Average   Remaining          Exercise   Contractual      Outstanding   Price Per   Life      Shares   Share   (in Years)   Balance, December 31, 2024 (Successor)   64,948   $10.00    9.64   Options granted   406,251   $1.43    -   Balance, March 31, 2025 (Successor)   471,199   $2.61    9.86   Options exercisable as of March 31, 2025   71,000   $7.56    9.57  

27

The Company estimated the
fair value of the stock options during the three months ended March 31, 2025 using Black-Scholes with the following assumptions.

     March 31,      2025      (Successor)   Risk-free interest rate   4.01%  Expected life (in years)   5.0   Expected dividend yield   -%  Expected volatility   121.09% 

For the period from February
14, 2024 through March 31, 2024, the Company recorded stock-based compensation expense of $0.09 million, of which $0.03 million was
related to R&D and $0.06 was related to general and administrative. For the period from January 1, 2024 through February 13