Company: CERO
Filing Date: 2025-02-07
Form Type: 424B3
Source: 0001213900-25-011071
Chunk: 415

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-02-07
Form: 424B3
Chunk 415
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occur, and the Company applies the simplified method to estimate expected term of “plain vanilla” options. All options and
restricted stock awards granted since inception are expensed on a straight-line basis over the requisite service period, which is usually
the vesting period, and the related amount is recognized in the statements of operations.

The accounting for stock options granted to outside
consultants is consistent with the accounting for stock-based payments to officers and directors, as described above, by measuring the
cost of services received in exchange for equity awards utilizing the grant date fair value of the awards, with the cost recognized as
stock-based compensation expense on the straight-line basis in the Company’s financial statements over the vesting period of the
awards.

Income taxes– The Company accounts
for income taxes under the liability method. Under this method, deferred tax assets and liabilities are determined based on the difference
between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences
are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts
expected to be realized.

<div align='center'>F-58

CERo Therapeutics, Inc.

Notes to Financial Statements</div>

The Company follows tax accounting requirements
for the recognition, measurement, presentation, and disclosure in the financial statements of any uncertain tax positions that have been
taken or expected to be taken on a tax return. No liability related to uncertain tax positions is recorded in the financial statements.
It is the Company’s policy to include penalties and interest expense related to income taxes as a component of income tax expense,
as necessary. The Company has not recorded any interest or penalties associated with income tax since inception. Tax years subsequent
to 2020 are subject to examination by federal and state authorities.

Earnings per share –The Company
reports both basic and diluted earnings per share. Basic earnings per share is calculated based on the weighted average number of shares
of common stock outstanding and excludes the dilutive effect of convertible preferred stock, convertible preferred stock warrants, stock
options or any other type of convertible securities. Diluted earnings per share is calculated based on the weighted average number of
shares of common stock outstanding and when the effect of stock options, warrants and other types of convertible securities is dilutive,
they are included in the calculation. Dilutive securities are excluded from the diluted earnings per share calculation if their effect
is anti-dilutive, such as in periods where the Company