Company: SZZL
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-044190
Chunk: 49

Company: Sizzle Acquisition Corp. II
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 49
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 the Public Shares were charged to temporary equity, and offering costs allocated
to Public Rights and Private Placement Units were charged to shareholder’s deficit, as the Rights, after Management’s evaluation,
were accounted for under equity treatment.

Fair Value of Financial Instruments

The fair value of the Company’s assets and
liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying
amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature.

Income Taxes

The Company accounts for income taxes under ASC
Topic 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income
taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets
and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods
in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred
tax assets to the amount expected to be realized.

ASC Topic 740 prescribes a recognition threshold
and a measurement attribute for the financial statement 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. The Company’s 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 March 31, 2025 and December
31, 2024, 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 an exempted Cayman
Islands 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 period 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 ASC Topic 815, “Derivatives and
Hedging.” For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded
at its fair value on