Cero Therapeutics Holdings, Inc S-1/A, filed Oct 22, 2024
Cero Therapeutics Holdings, Inc. (CERO)
As filed with the Securities and Exchange Commission on October 21, 2024
Registration No. 333-282755
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
to
FORM
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
(Exact name of registrant as specified in its charter)
| 2836 | 81-4182129 | |||
| (State or other jurisdiction of incorporation or organization) | (Primary Standard Industrial Classification Code Number) | (I.R.S. Employer Identification No.) |
201 Haskins Way, Suite 230
South San Francisco, CA 94080
(215) 731-9450
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Chris Ehrlich
Interim Chief Executive Officer
CERo Therapeutics Holdings, Inc.
201 Haskins Way, Suite 230
South San Francisco, CA 94080
Telephone: (215) 731-9450
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Stephen M. Davis
Jeffrey A. Letalien
Goodwin Procter LLP
620 Eighth Avenue
New York, NY 10018
(212) 813-8800
Approximate date of commencement of proposed sale to the public: From time to time after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: ☒
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | ||
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant
to Section 7(a)(2)(B) of the Securities Act.
The registrant (the “Registrant”) hereby amends this registration statement (this “Registration Statement”) on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
Cero Therapeutics Holdings, Inc. is filing this Amendment No. 1 (this “Amendment”) to its registration statement on Form S-1 (File No. 333-282755) (as amended, the “Registration Statement”) as an exhibit-only filing. Accordingly, this Amendment consists only of the facing page, this explanatory note, Part II of the Registration Statement, the signature page to the Registration Statement and the filed exhibit. The remainder of the Registration Statement is unchanged and has therefore been omitted.
1
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.
The following table sets forth the estimated expenses to be borne by the registrant in connection with the securities being registered hereby.
| Expense | Estimated Amount | |||
| Securities and Exchange Commission registration fee | $ | 9,526.30 | ||
| FINRA filing fee | $ | * | ||
| Accounting fees and expenses | * | |||
| Legal fees and expenses | * | |||
| Financial printing and miscellaneous expenses | * | |||
| Total | $ | * | ||
| * | These fees are calculated based on the securities offered and the number of issuances and accordingly cannot be defined at this time. |
Item 14. Indemnification of Directors and Officers
Section 145(a) of the DGCL provides, in general, that a corporation may indemnify any person who was or is a party to or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation), because he or she is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding, if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.
Section 145(b) of the DGCL provides, in general, that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor because the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made with respect to any claim, issue or matter as to which he or she shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or other adjudicating court determines that, despite the adjudication of liability but in view of all of the circumstances of the case, he or she is fairly and reasonably entitled to indemnity for such expenses that the Court of Chancery or other adjudicating court shall deem proper.
II-1
Section 145 of the DGCL further provides that to the extent a director or officer of a corporation has been successful on the merits or otherwise in the defense of any action, suit or proceeding referred to in Section 145(a) or (b) of the DGCL, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith; that indemnification provided for by Section 145 of the DGCL shall not be deemed exclusive of any other rights to which the indemnified party may be entitled; and the indemnification provided for by Section 145 of the DGCL shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of such person’s heirs, executors and administrators. Section 145(g) of the DGCL provides, in general, that a corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of his or her status as such, whether or not the corporation would have the power to indemnify the person against such liability under Section 145 of the DGCL.
Section 102(b)(7) of the DGCL provides that a corporation’s certificate of incorporation may contain a provision eliminating or limiting the personal liability of a director to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director; provided that such provision shall not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL or (iv) for any transaction from which the director derived an improper personal benefit.
Additionally, our Charter and Bylaws limit the liability of our (i) directors and (ii) officers, which includes each individual who has been duly appointed as an officer of CERo and who, at the time of an act or omission as to which liability is asserted, is deemed to have consented to service of process to our registered agent as contemplated by Section 3114(b) of Title 10 of the DGCL, in each case, to the fullest extent permitted by the DGCL, and also provides that we indemnify our directors and officers to the fullest extent permitted by the DGCL.
In connection with the Closing, we entered into indemnification agreements with each of our directors and executive officers. These agreements provide that we indemnify each of our directors and officers to the fullest extent permitted by law and our Charter and Bylaws, and provides for advancement of expenses incurred as a result of any proceeding against them as to which they could be indemnified.
We also maintain a general liability insurance policy, which covers certain liabilities of our directors and officers arising out of claims based on acts or omissions in their capacities as directors or officers.
Item 15. Recent Sales of Unregistered Securities.
In February 2024, May 2024 and August 2024, we issued 119,050, 250,351 and 1,613,944 shares of Common Stock, respectively, to an investor as commitment shares in consideration for entering into an equity line of credit with us. The issuance of these securities was made pursuant to Section 4(a)(2) of the Securities Act, and the rules promulgated thereunder, to an accredited investor. As of the date of this prospectus, we have issued an aggregate of 23,377,921 shares of Common Stock to such investor pursuant to the equity line of credit.
In February 2024, we issued an aggregate of 10,039 shares of Series A Preferred Stock, at a price of $1,000 per share, initially convertible into 1,039,000 shares of Common Stock at $10.00 per share, and 2,500 Preferred Warrants, resulting in aggregate gross proceeds to us of approximately $10.1 million. Such issuance includes 2,180 shares of Series A Preferred Stock, initially convertible into 2,180,000 shares of Common Stock, that were issued to certain investors in exchange for consideration consisting of approximately $2.16 million aggregate outstanding principal amount, together with accrued and unpaid interest thereon of approximately $0.02 million, of certain convertible promissory notes issued in June 2023 by Legacy CERo and a promissory note issued in December 2022, as amended in December 2023, by PBAX. As additional consideration to certain investors, we also issued 612,746 Series A Warrants as a structuring fee. In March 2024, with the consent of the applicable investors, a portion of the shares of Series A Preferred Stock and Series A Warrants was cancelled and reissued to the purchasers of Series B Preferred Stock described below.
In March 2024, we issued an aggregate of 626 shares of Series B Preferred Stock, at a price of $1,000 per share, initially convertible into 62,600 shares of Common Stock at $10.00 per share, resulting in aggregate gross proceeds to us of approximately $0.5 million.
II-2
In May 2024, we issued 345,566 shares of Common Stock to an investor as commitment shares in consideration for entering into an equity line of credit with us. The issuance of these securities was made pursuant to Section 4(a)(2) of the Securities Act, and the rules promulgated thereunder, to an accredited investor.
In September 2024, we issued an aggregate of 2,853 shares of Series C Preferred Stock, at a price of $1,000 per share, and 8,175,166 shares of Series C Warrants, resulting in aggregate gross proceeds to us of approximately $1.25 million.
The issuance of these securities was made pursuant to 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D, and the rules promulgated thereunder, to accredited investors.
Item 16. Exhibits and Financial Statements Schedules.
(a) Exhibits.
II-3
II-4
II-5
| * | Previously filed. |
| ** | Filed herewith. |
| + | Indicates management contract or compensatory plan. |
(b) Financial Statement Schedules.
See the index to the consolidated financial statements included on page F-1 for a list of the financial statements included in this registration statement. Schedules not listed above have been omitted because the information required to be set forth therein is not applicable or is shown in the financial statements or notes thereto.
Item 17. Undertakings
The undersigned registrant hereby undertakes:
| 1. | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
| (i) | To include any prospectus required by section 10(a)(3) of the Securities Act; |
II-6
| (ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement. |
| (iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; |
| 2. | That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
| 3. | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
| 4. | That, for the purpose of determining liability under the Securities Act to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. |
| 5. | That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities, that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: |
| (i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
| (ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
| (iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
| (iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
II-7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Amendment No. 2 to the Registration Statement on Form S-1 to be signed on its behalf by the undersigned, duly authorized, in the city of South San Francisco, State of California, on the 21st day of October, 2024.
| CERO THERAPEUTICS HOLDINGS, INC. | ||
| By: | /s/ Chris Ehrlich | |
| Chris Ehrlich | ||
| Interim Chairman, Chief Executive Officer and Director | ||
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed below by the following person in the capacities and on the dates indicated.
| Signature | Title | Date | ||
| * | Interim Chairman and Chief Executive Officer and Director | |||
| Chris Ehrlich | (Principal Executive Officer) | October 21, 2024 | ||
| * | Chief Financial Officer | |||
| Andrew Kucharchuk | (Principal Financial and Accounting Officer) | October 21, 2024 | ||
| * | Director | |||
| Michael Byrnes | October 21, 2024 | |||
| * | Director | |||
| Kathleen LaPorte | October 21, 2024 | |||
| * | Director | |||
| Lindsey Rolfe | October 21, 2024 | |||
| * | Director | |||
| Shami Patel | October 21, 2024 |
| *By: | /s/ Andrew Kucharchuk | |
Andrew Kucharchuk Attorney-in-fact |
II-8
Exhibit 5.1
 |
Goodwin Procter LLP The New York Times Building 620 Eighth Avenue New York, NY 10018 |
October 21, 2024
CERo Therapeutics Holdings, Inc.
201 Haskins Way, Suite 230
South San Francisco, CA 94080
| Re: | Securities Registered under Registration Statement on Form S-1 |
We have acted as counsel to you in connection with your filing of a Registration Statement on Form S-1 (as amended or supplemented, the “Registration Statement”) pursuant to the Securities Act of 1933, as amended (the “Securities Act”), relating to the registration by CERo Therapeutics Holdings, Inc., a Delaware corporation (the “Company”), of the offer and sale from time to time by the selling securityholders named in the Registration Statement (the “Selling Securityholders”), of up to (i) 57,670,954 shares (the “Series A Conversion Shares”) of the Company’s common stock, par value $0.0001 per share (the “Common Stock”), issuable upon the conversion of shares of the Company’s Series A Preferred Stock, par value $0.0001 per share (the “Series A Preferred Stock”), purchased by certain investors pursuant to the Amended and Restated Securities Purchase Agreement, dated as of February 14, 2024, by and among CERo Therapeutics, Inc. (“Legacy CERo”), Phoenix Biotech Acquisition Corp. (“PBAX”) and such investors (the “First Securities Purchase Agreement”); (ii) 9,182,934 shares (the “Series B Conversion Shares”) of Common Stock issuable upon the conversion of shares of the Company’s Series B Preferred Stock, par value $0.0001 per share (the “Series B Preferred Stock”), purchased by certain investors pursuant to the Securities Purchase Agreement, dated as of March 29, 2024, by and among the Company and such investors; (iii) 70,739,367 shares (the “Converted Shares”) of Common Stock issued upon the conversion of shares of the Company’s Series A Preferred Stock and Series B Preferred Stock prior to the date hereof; (iv) 436,683,678 shares (the “Series C Conversion Shares” and, together with the Series A Conversion Shares and the Series B Conversion Shares, the “Conversion Shares”) of Common Stock issuable upon the conversion of shares of the Company’s Series C Preferred Stock, par value $0.0001 per share (the “Series C Preferred Stock”), purchased by certain investors pursuant to the Securities Purchase Agreement, dated as of September 25, 2024, by and among the Company and such investors (the “Third Securities Purchase Agreement”); (v) 250,000 shares of Common Stock (the “Reallocation Shares”) issued to a stockholder pursuant to the Share Reallocation Agreement, dated as of February 14, 2024, by and among PBAX Biotech Sponsor, LLC, PBAX and the investor party thereto; (vi) 75,000,000 shares of Common Stock issuable to a service provider (the “Service Provider Shares”); (vii) 8,175,166 shares of Common Stock (the “Warrant Shares”) issuable upon the exercise of warrants to purchase shares of Common Stock that were sold to certain investors pursuant to the Third Securities Purchase Agreement (the “Series C Warrants”) and (viii) 55,861,651 shares of Common Stock (the “Preferred Warrant Shares”) issuable upon conversion of the shares of Series A Preferred Stock issuable upon the exercise of warrants (the “Preferred Warrants”) to purchase shares of the Company’s Series A Preferred Stock sold to certain investors pursuant to the First Securities Purchase Agreement.
We have reviewed such documents and made such examination of law as we have deemed appropriate to give the opinions set forth below. We have relied, without independent verification, on certificates of public officials and, as to matters of fact material to the opinions set forth below, on certificates of officers of the Company. For purposes of our opinions set forth below, we have assumed that no event occurs that causes the total number of the Conversion Shares, Service Provider Shares, Warrant Shares and Preferred Warrant Shares when added to the number of shares of Common Stock issued, subscribed for, or otherwise committed to be issued, to exceed the number of shares of Common Stock authorized by the Company’s certificate of incorporation (the “Certificate of Incorporation”).
The opinion set forth below is limited to the Delaware General Corporation Law.
Based on the foregoing, we are of the opinion that:
1. The Conversion Shares have been duly authorized and, when delivered upon the conversion of the Series A Preferred Stock, Series B Preferred Stock or Series C Preferred Stock, as applicable, in accordance with the terms of the Certificate of Incorporation, will be validly issued, fully paid and nonassessable.
2. The Converted Shares and Reallocation Shares have been duly authorized and validly issued and are fully paid and nonassessable.
3. The Service Provider Shares have been duly authorized and, when delivered pursuant to the terms of the agreement with the service provider, will be validly issued, fully paid and nonassessable.
4. The Warrant Shares have been duly authorized and, when delivered upon exercise of the Series C Warrants in accordance with the terms of the Series C Warrants, will be validly issued, fully paid and nonassessable.
5. The Preferred Warrant Shares have been duly authorized and, when delivered upon conversion in accordance with the Certificate of Incorporation of the shares of Series A Preferred Stock issued upon exercise of the Preferred Warrants in accordance with the terms of the Preferred Warrants, will be validly issued, fully paid and nonassessable.
This opinion letter and the opinions it contains shall be interpreted in accordance with the Core Opinion Principles as published in 74 Business Lawyer 815 (Summer 2019).
We hereby consent to the inclusion of this opinion as Exhibit 5.1 to the Registration Statement and to the references to our firm under the caption “Legal Matters” in the Registration Statement. In giving our consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations thereunder.
| Very truly yours, | |
| /s/ GOODWIN PROCTER LLP | |
| GOODWIN PROCTER LLP |