If You Invested in Spring Valley Acquisition Corp. II (SVII)

Spring Valley Acquisition Corp. II (trading under the symbol SVII) is a blank check company formed in the Cayman Islands. According to its SEC filings, it is an emerging growth company whose securities have been listed on The Nasdaq Stock Market. The company’s structure and disclosures identify it as a special purpose acquisition company (SPAC) focused on completing an initial business combination within a defined timeframe.

Spring Valley Acquisition Corp. II has issued several classes of securities on Nasdaq. These include units (SVIIU), each consisting of one Class A ordinary share, one right and one-half of one redeemable public warrant; standalone Class A ordinary shares (SVII); rights to acquire one-tenth of one Class A ordinary share (SVIIR); and redeemable public warrants (SVIIW), with each whole warrant exercisable for one Class A ordinary share at a specified exercise price. These securities and their terms are described in detail in the company’s current reports on Form 8-K.

The company’s governing documents provide that it must complete an initial merger, share exchange, asset acquisition, share purchase, reorganisation or similar business combination within a set number of months from the closing of its initial public offering. Through shareholder meetings and proxy materials, Spring Valley Acquisition Corp. II has sought and obtained approval to extend this deadline, including an extension to 45 months from the IPO closing, or an earlier date determined by its board of directors. In connection with these extensions, its sponsor, Spring Valley Acquisition Sponsor II, LLC, may deposit specified monthly amounts into the trust account for each extension period in exchange for a non-interest bearing, unsecured promissory note payable upon consummation of a business combination.

The company maintains a trust account established for the benefit of its public shareholders. Public shareholders holding Class A ordinary shares have the right, in connection with certain shareholder votes such as extension proposals or a proposed business combination, to elect to redeem their public shares for cash at a per-share price based on the funds then held in the trust account, including interest earned and subject to permitted withdrawals and applicable deductions. SEC filings describe the mechanics of these redemption rights and the related U.S. federal income tax considerations for shareholders exercising redemption rights.

Spring Valley Acquisition Corp. II has entered into an Amended and Restated Agreement and Plan of Merger with Eagle Nuclear Energy Corp., Eagle Energy Metals Corp., and merger subsidiaries. Under this agreement, a series of transactions referred to as the New Eagle Business Combination is contemplated. The structure includes a first merger in which a merger subsidiary will merge with and into Spring Valley Acquisition Corp. II, with the company surviving as a wholly owned subsidiary of Eagle Nuclear Energy Corp., and a second merger in which another merger subsidiary will merge with and into Eagle Energy, with Eagle Energy surviving as a wholly owned subsidiary of Eagle Nuclear Energy Corp. The agreement sets out how SVII ordinary shares, rights, units, and warrants would convert into securities of Eagle Nuclear Energy Corp. if the transaction is completed, as well as the aggregate merger consideration and a potential earnout in shares of Eagle Nuclear Energy Corp. common stock.

As disclosed in a Form 8-K, the Nasdaq Listing Qualifications Department notified Spring Valley Acquisition Corp. II that its securities would be delisted from The Nasdaq Stock Market because it did not complete its initial business combination by the required deadline under Nasdaq rules. Trading in the company’s Class A ordinary shares, warrants, rights, and units is scheduled to be suspended on a specified date, and Nasdaq has indicated that it will file a Form 25-NSE with the SEC to remove the company’s securities from listing and registration on Nasdaq. The company has stated in that filing that, notwithstanding the delisting, it intends to continue to pursue an initial business combination and a subsequent listing of the post-combination company’s securities on Nasdaq, although there can be no assurance that such efforts will be successful. The company also notes that it will remain a reporting entity under the Securities Exchange Act of 1934 with ongoing disclosure obligations.

Shareholder votes and related outcomes are detailed in the company’s proxy statement and current reports. At an extraordinary general meeting, holders of ordinary shares representing a substantial percentage of the company’s voting power were present in person, virtually, or by proxy, and approved the extension amendment proposal to modify the deadline for completing a business combination. In connection with that vote, a portion of public shareholders elected to redeem their Class A ordinary shares for cash, and the remaining balance in the trust account and the number of outstanding Class A ordinary shares after redemptions are disclosed in the relevant Form 8-K.

Spring Valley Acquisition Corp. II’s filings also describe financing arrangements related to its ongoing efforts to complete a business combination. For example, the company issued an unsecured promissory note in favor of its sponsor, allowing drawdowns up to a stated principal amount prior to the maturity date, which is defined as the date on which the company consummates its initial business combination. The note does not bear interest, and the sponsor has the option, upon consummation of a business combination, to convert some or all of the outstanding principal into working capital warrants. These working capital warrants would have terms identical to the private placement warrants issued at the time of the company’s initial public offering, including applicable transfer restrictions.

Through its proxy materials and supplemental disclosures, Spring Valley Acquisition Corp. II explains the implications of its extension proposals, redemption mechanics, and potential liquidation. If it does not complete a business combination by the extended deadline (or an earlier date determined by its board), its articles of association provide that it will cease operations except for winding up, redeem all public shares for cash from the trust account, and then liquidate and dissolve, subject to its obligations under Cayman Islands law to provide for claims of creditors and other legal requirements.