Spring Valley Acquisition Corp. II(SVIIU) - 2023 Q1 - Quarterly Report

PART I. FINANCIAL INFORMATION Financial Statements This section presents the unaudited condensed financial statements for Spring Valley Acquisition Corp. II for the quarterly period ended March 31, 2023, including balance sheets, statements of operations, changes in shareholders' deficit, cash flows, and detailed notes Condensed Balance Sheets As of March 31, 2023, total assets were approximately $241.9 million, primarily from trust account investments, resulting in a $6.3 million shareholders' deficit Condensed Balance Sheet Data (unaudited) | Account | March 31, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Assets | | | | Cash | $1,567,814 | $1,731,726 | | Investments held in Trust Account | $239,957,696 | $237,438,356 | | Total Assets | $241,891,581 | $239,570,602 | | Liabilities & Shareholders' Deficit | | | | Total Liabilities | $8,185,073 | $8,190,177 | | Class A ordinary shares subject to possible redemption | $239,957,696 | $237,438,356 | | Total shareholders' deficit | $(6,251,188) | $(6,057,931) | | Total Liabilities and Shareholders' Deficit | $241,891,581 | $239,570,602 | Unaudited Condensed Statements of Operations For the three months ended March 31, 2023, the company reported a net income of approximately $2.3 million, primarily from $2.5 million in Trust Account investment income Statement of Operations Highlights (unaudited) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Loss from operations | $(193,310) | $(29,342) | | Income from investments held in Trust Account | $2,519,340 | $— | | Net income (loss) | $2,326,083 | $(29,342) | | Net income (loss) per share, Class A & B - basic/diluted | $0.08 | $(0.00) | Unaudited Condensed Statements of Cash Flows Net cash used in operating activities for the three months ended March 31, 2023, was approximately $164,000, reducing the cash balance to $1.57 million Cash Flow Summary (unaudited) | Cash Flow Item | Three Months Ended March 31, 2023 | | :--- | :--- | | Net cash used in operating activities | $(163,912) | | Net change in cash | $(163,912) | | Cash - beginning of the period | $1,731,726 | | Cash - end of the period | $1,567,814 | Notes to Unaudited Condensed Financial Statements These notes clarify the company's nature as a blank check company, detailing IPO terms, trust account placement, related-party transactions, and going concern considerations - The company is a blank check company formed to effect a business combination, with 15 months from its IPO closing (October 17, 2022), plus a potential 3-month extension, to complete a transaction or face liquidation[15][25][26] - Management determined that the mandatory liquidation requirement raises substantial doubt about the Company's ability to continue as a going concern[31] - All 23,000,000 Class A ordinary shares are classified as redeemable and held outside of permanent equity, with a redemption value of $239,957,696 as of March 31, 2023[50][51] - The Sponsor may provide Working Capital Loans (up to $1.5 million convertible into warrants) and Extension Loans to fund operations and extend the combination period[30][70][71] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's financial condition and operations as a pre-business combination SPAC, highlighting Q1 2023 net income, liquidity, going concern risk, and contractual obligations Overview The company is a Cayman Islands blank check company formed for a business combination, with $235.8 million in a trust account and a January 2024 completion deadline - The company is a blank check company whose activities since inception relate to its formation, IPO, and search for an initial business combination[96][97] - The deadline to complete a business combination is 15 months from the IPO closing (January 17, 2024), with a one-time, three-month extension possible (to April 17, 2024)[104][105] Results of Operations For the three months ended March 31, 2023, the company reported a net income of approximately $2.3 million, driven by $2.5 million from Trust Account investments Quarterly Performance Comparison | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Net Income / (Loss) | ~$2.3 million | ~($29,000) | | Key Driver | ~$2.5M income from Trust Account | General & administrative expenses | Going Concern Consideration Management concluded substantial doubt exists about the company's going concern ability due to mandatory liquidation if a business combination is not completed - As of March 31, 2023, the company had approximately $1.6 million in cash held outside the Trust Account and working capital of approximately $1.8 million[109] - Management determined that the mandatory liquidation provision raises substantial doubt about the company's ability to continue as a going concern[112] Contractual Obligations Primary contractual obligations include deferred underwriting commissions of approximately $8.1 million and deferred legal fees of $802,000, contingent on business combination completion - The company is obligated to pay its Sponsor $10,000 per month for administrative support services[116] - Deferred underwriting commissions of approximately $8.1 million are payable from the Trust Account only upon completion of a business combination[119] - Deferred legal fees were approximately $802,000 as of March 31, 2023, payable only upon completion of a business combination[120] Critical Accounting Policies and Estimates Key accounting policies include classifying Class A ordinary shares as redeemable, pro-rata income allocation for EPS, and treating warrants and rights as equity-classified instruments - All 23,000,000 Class A ordinary shares are classified as redeemable and measured at their redemption value at the end of each reporting period[122] - The company's warrants and rights are accounted for as equity-classified instruments in accordance with ASC 815-40, meaning subsequent changes in fair value are not recognized in earnings[126] Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, the company is not required to provide market risk disclosures - The company is a smaller reporting company and is not required to provide information for this item[130] Controls and Procedures Management concluded disclosure controls and procedures were effective as of March 31, 2023, with no material changes to internal control over financial reporting - Management concluded that disclosure controls and procedures were effective as of March 31, 2023[131] - No material changes in internal control over financial reporting occurred during the fiscal quarter ended March 31, 2023[132] PART II. OTHER INFORMATION Legal Proceedings The company reports no legal proceedings - The company reports no legal proceedings[133] Risk Factors No material changes to risk factors disclosed in the company's 2022 Annual Report on Form 10-K - There have been no material changes to the risk factors disclosed in the company's 2022 Annual Report on Form 10-K[134] Unregistered Sales of Equity Securities and Use of Proceeds Details unregistered sales of Founder Shares and Private Placement Warrants to the Sponsor, confirming planned use of IPO and private placement proceeds Unregistered Sales of Equity Securities Details the sale of 7,666,667 Founder Shares for $25,000 and 13,350,000 Private Placement Warrants at $1.00 each to the Sponsor - The Sponsor purchased 7,666,667 Class B ordinary shares (Founder Shares) for $25,000[135] - Simultaneously with the IPO, the Sponsor purchased 13,350,000 Private Placement Warrants at $1.00 each in a private placement[136] Use of Proceeds Confirms $235.8 million (or $10.25 per Unit) of the net proceeds from the IPO and Private Placement were placed in the Trust Account, with no material change in planned use - $235.8 million (or $10.25 per Unit) of the net proceeds from the IPO and Private Placement was placed in the Trust Account[136] Defaults Upon Senior Securities The company reports no defaults upon senior securities - The company reports no defaults upon senior securities[137] Mine Safety Disclosures This item is not applicable to the company - This item is not applicable to the company[137] Other Information The company reports no other information - The company reports no other information[137] Exhibits Lists exhibits filed with the Quarterly Report on Form 10-Q, including CEO/CFO certifications and Inline XBRL documents - The report includes required CEO and CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906, along with XBRL data files[138]