Company: CERO
Filing Date: 2025-08-22
Form Type: 10-Q
Source: 0001213900-25-079898
Chunk: 167

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-08-22
Form: 10-Q
Item: Item 8
Chunk 167
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 price of a share of Common Stock. Trigger Events include customary terms related to exchange listing, registration rights,
failure to deliver shares on conversion or exercise of derivative instruments, or insolvency. Notwithstanding the Series C Conversion
Price Floor, if the Series C Conversion Price Floor is greater than 80% of the 5-day volume weighted average price of a share of Common
Stock, then the Conversion Amount (as defined in the Series C Certificate of Designation) for such Series C Preferred Stock is increased
by a multiplier resulting in the convertibility of the shares of Series C Preferred Stock into the number of shares of Common Stock that
would have been issuable if the Alternate Conversion Price had been equal to such lower volume weighted average price.

Redemptions:
Upon bankruptcy or liquidation, Series C Preferred Stock will be redeemed at a 25% premium to the conversion amount multiplied by the
highest Alternative Conversion Price within the preceding 20 days multiplied by 125% of the greatest closing sale price of the Common
Stock on any day immediately following public announcement of insolvency and the date the entire redemption payment has been made. Additionally,
the Company may voluntarily redeem the Series C Preferred Stock at a 25% premium to the greater of the Conversion Amount or the number
of shares multiplied by the highest closing price within the preceding 20 days.

The
holders of the Series C Preferred Stock have no voting rights.

In September 2024, the Company
consummated a private placement (the “Series C PIPE Financing”) of 2,853 shares of Series C Preferred Stock and warrants
to purchase 4,088 shares of Common Stock (See Note 9 below), pursuant to the Securities Purchase Agreement, dated September 25, 2024,
by and among the Company and certain accredited investors for aggregate gross cash proceeds to the Company of approximately $1.25 million.

The
Company accounts for preferred stock as either equity or debt-like securities based on an assessment of the Preferred Stock rights and
preferences and applicable authoritative guidance in ASC 480 and ASC 815, Derivatives and Hedging. The Company has concluded that the
Series C Preferred Stock, which has no cash redemption features outside of the Company’s control are treated as equity. The Company
has also concluded that the Series C Common Warrants do not possess redemption features outside of the Company’s control and are
treated as equity.

On March 10, 2025, the Company paid certain investors $395,000 for
the redemption of 316