Company: SZZL
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001213900-25-110104
Chunk: 64

Company: Sizzle Acquisition Corp. II
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 8
Chunk 64
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 expected to affect taxable income.
Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

9

SIZZLE
ACQUISITION CORP. II

NOTES
TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

SEPTEMBER
30, 2025

ASC
740 prescribes a recognition threshold and a measurement attribute for the financial statements recognition and measurement of tax positions
taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be
sustained upon examination by taxing authorities. Management determined that the Cayman Islands is the Company’s major tax jurisdiction.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of September 30,
2025, there were no unrecognized tax benefits and no amounts accrued for interest and penalties. The Company is currently not aware of
any issues under review that could result in significant payments, accruals or material deviation from its position.

The
Company is considered to be a Cayman Islands exempted company with no connection to any other taxable jurisdiction and is presently not
subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As such, the Company’s tax
provision was zero for the periods presented. 

Derivative
Financial Instruments

The
Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded
derivatives in accordance with FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). For derivative
financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the
grant date and is then re-valued at each reporting date, with changes in the fair value reported in the accompanying unaudited condensed
statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities
or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the accompanying condensed balance
sheets as current or non-current based on whether or not net cash settlement or conversion of the instrument could be required within
12 months of the date of the accompanying condensed balance sheets.

Rights

The
Company accounted for the Rights issued in connection with the Initial Public Offering and the Private Placement in accordance with the
guidance contained in ASC 815. Accordingly, the Company evaluated and