Company: CHPG
Filing Date: 2025-07-07
Form Type: 10-Q
Source: 0001213900-25-061810
Chunk: 56

Company: ChampionsGate Acquisition Corp
Filing Date: 2025-07-07
Form: 10-Q
Item: Part I, Item 8
Chunk 56
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 the “insider shares”). As a result, the Sponsor HoldCo owns 800,000 Class
A insider shares and 1,150,161 Class B insider shares.

On May 15, 2024, the Sponsor entered into
a securities transfer agreement, pursuant to which the Sponsor transferred 100,000 insider shares, which equated to 4.6% of the 2,170,161
Class B ordinary shares, at the purchase price of $1,159.42 to Bala Padmakumar, the CEO, Chairman and Director of the Company and
60,000 insider shares at the purchase price of $695.65 to Evan M. Graj, the CFO and director of the Company, respectively. The fair
value of these 160,000 shares transferred on the grant date was $33,760 or $0.211 per share per valuation performed by a third-party specialist.
The Company accounted for the transfer under ASC 718 stock compensation (See Note 2 for details).

The share price was calculated using a scenario-based
method, incorporating probabilities of both a de-SPAC and an IPO, with the total unit value reaching $10 and the right valued at one-eighth
of the share price. Based on these probabilities, an indicated per share marketable value for the Founders Shares was determined, and
a discount for lack of marketability, derived from the Finnerty model, was applied to yield a minority non-marketable fair value. The
following criteria presents the quantitative information regarding market assumptions used in the founder share valuation performed by
a third-party specialist:

    May 15,  2024 
  
    Estimated Volatility 
     102.5%
  
    Risk-free rate 
     4.67%
  
    Spot price 
    $9.639 
  
    Discount of lack of marketability (DLOM) 
     27.02%

12

Promissory Note — Related Party

On
April 18, 2024, the Sponsor agreed to loan the Company up to $500,000 (the “Promissory Note”) to be used for a portion
of the expenses of the IPO. As of March 31, 2025 and December 31, 2024, the Company has an outstanding loan balance of $417,147
and $331,927, respectively. This Promissory Note is non-interest bearing, unsecured and is due at the earlier of (