Company: CHPG
Filing Date: 2025-07-07
Form Type: 10-Q
Source: 0001213900-25-061810
Chunk: 12

Company: ChampionsGate Acquisition Corp
Filing Date: 2025-07-07
Form: 10-Q
Item: Part I, Item 1
Chunk 12
---
 determined using prices for recently traded assets and liabilities with similar underlying terms, as well as direct or indirect observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals.

    ●
    Level 3 — Inputs to the fair value measurement are unobservable inputs, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities.

9

Stock Compensation

The Company accounts for stock-based compensation
expense in accordance with ASC 718, “Compensation — Stock Compensation” (“ASC 718”).
Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date and
recognized over the requisite service period. To the extent a stock-based award is subject to a performance condition, the amount of expense
recorded in a given period, if any, reflects an assessment of the probability of achieving such performance condition, with compensation
recognized once the event is deemed probable to occur. Forfeitures are recognized as incurred.

Income Taxes

The Company accounts for income taxes under ASC 740
Income Taxes (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected
impact of differences between the financial statement and tax basis of assets and liabilities and for the expected future tax benefit
to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established
when it is more likely than not that all or a portion of deferred tax assets will not be realized.

ASC 740 also clarifies the accounting for
uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement
process for financial statement recognition and measurement of a tax position 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. ASC 740
also provides guidance on derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition.
Based on the Company’s evaluation, it has been concluded that there are no significant uncertain tax positions requiring recognition
in the Company’s unaudited financial statements.

The Company recognizes accrued interest and penalties
related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest
and penalties as of March 31, 2025. The Company is currently not aware of any issues under review that could result in