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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM 10-Q
______________________
(Mark One)
☑
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2023
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________ to ____________
Commission file number 001-04321
______________________
NUSCALE POWER CORPORATION
(Exact name of registrant as specified in its charter)
______________________
Delaware98-1588588
(State or other jurisdiction of
incorporation or organization)		(I.R.S. Employer Identification No.)
6650 SW Redwood Ln Suite 210PortlandOregon97224
(Address of Principal Executive Offices)(Zip Code)
(971) 371-1592
Registrant's telephone number, including area code
Robert Temple
6650 SW Redwood Lane
Suite 210
Portland
OR
97224
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Class A common stock, $0.0001 par value per share
SMR
New York Stock Exchange
Warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50 per share
SMR.WS
New York Stock Exchange
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer
o
Accelerated filer
☑
Non-accelerated filero
Smaller reporting company
☐
Emerging growth company
☑
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x

APPLICABLE ONLY TO CORPORATE ISSUERS:
The registrant had 70,441,214 Class A common shares, $0.0001 par value and 157,090,820 Class B common shares, $0.0001 par value outstanding as of May 5, 2023.


Table of Contents


Glossary

The definitions and abbreviations set forth below apply to the indicated terms used throughout this filing.

• “Class A common stock” refers to shares of Class A common stock, par value $0.0001 per share, of NuScale Power Corporation
• “Class B common stock” refers to shares of Class B common stock, par value $0.0001 per share, of NuScale Power Corporation, which represents the right to one vote per share and carries no economic rights.
• “Combined interests” refers to the combination of shares of Class B common stock and NuScale LLC Class B units required to be exchanged for Class A common stock
• “common stock” refers collectively to shares of Class A common stock and Class B common stock.
• “DOE” refers to the U.S. Department of Energy.
• “EPCDA” refers to Engineering, Procurement, Construction Development Agreement
• “Exchange Act” refers to the Securities Exchange Act of 1934, as amended.
• “Fluor” refers to Fluor Enterprises, Inc., a California corporation, which is wholly owned by Fluor
Corporation (NYSE: FLR).
• “GAAP” refers to generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.
• “G&A” expenses refers to general and administrative expenses.
• “IPO” or “Initial Public Offering” refers to the initial public offering of Spring Valley, which closed on
November 27, 2020.
• “Legacy NuScale Equityholders” refers to the holders of NuScale LLC Class B units
• “Merger” refers to the merger of Merger Sub with and into NuScale LLC, with NuScale LLC as the surviving entity.
• “Merger Agreement” refers to the Agreement and Plan of Merger, dated as of December 13, 2021 (as amended, modified, supplemented or waived from time to time), between Spring Valley, Merger Sub and NuScale LLC.
• “Merger Sub” refers to Spring Valley Merger Sub, LLC, an Oregon limited liability company and a
wholly owned subsidiary of Spring Valley.
• “MWe” refers to one million watts of electric power.
• “NPM” refers to NuScale Power Module™.
• “NRC” refers to the U.S. Nuclear Regulatory Commission.
• “NuScale Corp” refers to NuScale Power Corporation, a Delaware corporation and the combined company following the consummation of the Transaction, and its consolidated subsidiaries, including NuScale LLC.
• “NuScale LLC” refers to NuScale Power, LLC, an Oregon limited liability company.
• “NuScale LLC Class B Units” refers to non-voting, Class B units of NuScale LLC.
• “NYSE” means the New York Stock Exchange.
• “Private Placement Warrants” refers to the 8,900,000 warrants to purchase Spring Valley Class A ordinary shares that
were issued in a private placement concurrently with the IPO and converted in the Transaction into warrants to purchase Class A common stock.
• “Public Warrants” refers to the 11,500,000 redeemable warrants issued in the IPO and converted in the Transaction
into warrants to purchase Class A common stock.
• “R&D” refers to research and development.
• “SEC” refers to the United States Securities and Exchange Commission.
• “Securities Act” refers to the Securities Act of 1933, as amended.
• “SMR” refers to small modular reactor.
• “Spring Valley” refers to NuScale Corp prior to the Merger and prior to the change of its name from Spring Valley Acquisition Corp. to NuScale Power Corporation.
• “Tax Receivable Agreement” or “TRA” refers to the tax receivable agreement entered into concurrently with the Closing between NuScale Corp, NuScale LLC and the Legacy NuScale Equityholders.
• “Transaction” refers to the transactions contemplated by the Merger Agreement during the 2022 fiscal year.
• “Warrants” refers collectively to the Public Warrants and the Private Placement Warrants.












Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10-Q, including, without limitation, statements regarding our financial position and business strategy and the expectations, beliefs, intentions, plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “continue,” “could,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “will,” “would,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this Quarterly Report may include, for example, statements about:
•our financial and business performance, including financial projections and business metrics;
•the ability to obtain regulatory approvals to deploy our SMRs in the United States and abroad;
•forecasts regarding end-customer adoption rates and demand for our products in markets that are new and rapidly evolving;
•macroeconomic conditions;
•developments and projections relating to our competitors and industry;
•our anticipated growth rates and market opportunities;
•the period over which we anticipate our existing cash and cash equivalents will be sufficient to fund our operating expenses and capital expenditure requirements;
•litigation contingencies;
•financial arrangements with CFPP LLC;
•the potential for our business development efforts to maximize the potential value of our portfolio; and
•our estimates regarding expenses, future revenue, capital requirements and needs for additional financing.

Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. Many factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements, and there can be no assurance that future developments affecting us will be those we have anticipated.

Important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, are described in the section titled “Risk Factors” included in our 2022 10-K. If one or more of those risks or uncertainties materialize, or if any of our assumptions prove incorrect, actual results may vary in material respects from those projected in those forward-looking statements. There may be additional risks that we currently consider immaterial, or which are unknown. It is not possible to predict or identify all such risks. Except as expressly required by applicable securities law, we disclaim any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. No person should take any statement regarding past trends or activities as a representation that the trends or activities will continue in the future.


Part I - Financial Information
Item 1. Financial Statements
NuScale Power Corporation
Condensed Consolidated Balance Sheet
(in thousands, except share and per share amounts)March 31, 2023December 31, 2022
(unaudited)
ASSETS
Current assets
Cash and cash equivalents$218,164 $217,685 
Short-term investments— 50,000 
Prepaid expenses7,304 5,531 
Accounts and other receivables20,992 11,199 
   Total current assets246,460 284,415 
Property, plant and equipment, net4,506 4,770 
In-process research and development16,900 16,900 
Intangible assets, net1,015 1,059 
Goodwill8,255 8,255 
Restricted cash34,182 26,532 
Other assets5,054 6,704 
Long-term contract work in process16,018 — 
   Total assets$332,390 $348,635 
LIABILITIES AND EQUITY
Current liabilities
Accounts payable and accrued expenses$43,738 $27,951 
Accrued compensation6,442 9,038 
Other accrued liabilities1,511 1,568 
   Total current liabilities51,691 38,557 
Warrant liabilities30,457 29,349 
Noncurrent liabilities2,433 2,786 
Deferred revenue1,078 856 
   Total liabilities85,659 71,548 
Stockholders’ Equity
Class A common stock, par value $0.0001 per share, 332,000,000 shares authorized, 70,061,055 shares outstanding as of March 31, 2023
7 7 
Class B common stock, par value $0.0001 per share, 179,000,000 shares authorized, 157,090,820 shares outstanding as of March 31, 2023
16 16 
Additional paid-in capital302,487 296,748 
Accumulated deficit(193,054)(182,092)
   Total Stockholders’ Equity Excluding Noncontrolling Interests109,456 114,679 
Noncontrolling interests137,275 162,408 
   Total Stockholders' Equity246,731 277,087 
   Total Liabilities and Stockholders' Equity$332,390 $348,635 
The accompanying notes are an integral part of these financial statements.
1

NuScale Power Corporation
Condensed Consolidated Statements of Operations
(Unaudited)
(in thousands, except share and per share amounts)Three Months Ended March 31,
20232022
Revenue$5,505 $2,445 
Cost of sales(3,416)(1,205)
    Gross margin2,089 1,240 
Research and development expenses25,715 24,380 
General and administrative expenses14,695 10,520 
Other expenses17,151 10,188 
    Loss from operations(55,472)(43,848)
Sponsored cost share17,873 20,577 
Decrease (increase) in fair value of warrant liabilities(1,108)— 
Interest income (expense)3,097 (102)
   Loss before income taxes(35,610)(23,373)
Provision (benefit) for income taxes— — 
   Net loss(35,610)(23,373)
Net loss attributable to legacy NuScale LLC holders prior to Transaction— (23,373)
Net loss attributable to noncontrolling interests(24,648)— 
Net Loss Attributable to Class A Common Stockholders$(10,962)$— 
Loss Per Share of Class A Common Stock:
Basic and Diluted$(0.16)$— 
Weighted-Average Shares of Class A Common Stock Outstanding:
Basic and Diluted69,684,268 — 
The accompanying notes are an integral part of these financial statements.
2

NuScale Power Corporation
Condensed Consolidated Statements of Changes in Stockholders’ Equity
(in thousands)Common Stock
Class AClass BAdditional Paid-in CapitalAccumulated DeficitNoncontrolling InterestsTotal
Stockholders’
Equity
SharesAmountSharesAmount
Balances at December 31, 202269,353 $7 157,091 $16 $296,748$(182,092)$162,408 $277,087 
Equity-based compensation expense— — — — 3,637 — — 3,637 
Exercise of common share options and warrants and vested RSUs708 — — — 1,617 — — 1,617 
Rebalancing of ownership percentage for conversion of combined interest into Class A shares— — — — 485 — (485)— 
Net loss— — — — — (10,962)(24,648)(35,610)
Balances at March 31, 2023 (unaudited)70,061 $7 157,091 $16 $302,487 $(193,054)$137,275 $246,731 


(in thousands)
MezzanineConvertible Preferred UnitsCommon UnitsAccumulated DeficitTotal
Stockholders’
Equity
UnitsAmountUnitsAmountUnitsAmount
Balances at December 31, 20216,000 $2,140 633,261 $819,694 9,074 $28,184 $(781,620)$66,258 
Equity-based compensation expense— — — — — 1,021 — 1,021 
Exercise of common unit options— — — — 2,928 470 — 470 
Conversion of equity award to liability award— — — — — (50)— (50)
Repurchase of common units— — — — (343)(563)(563)
Issuance of treasury shares— — — — 12 20 — 20 
Net loss— — — — — — (23,373)(23,373)
Balances at March 31, 2022 (unaudited)6,000 $2,140 633,261 $819,694 11,671 $29,082 $(804,993)$43,783 

The accompanying notes are an integral part of these financial statements.
3

NuScale Power Corporation
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)Three months ended
March 31,
20232022
OPERATING CASH FLOW
Net loss$(35,610)$(23,373)
Adjustments to reconcile net loss to operating cash flow:
   Depreciation615 577 
   Amortization of intangibles44 44 
   Equity-based compensation expense3,637 1,021 
   Change in the fair value of warrant liabilities1,108 — 
   Net noncash change in right of use assets and lease liabilities(345)406 
   Changes in assets and liabilities:
      Prepaid expenses and other assets(99)(1,371)
      Accounts receivable(9,793)(2,716)
      Accounts payable and accrued expenses(170)(646)
      Lease liability(150)(452)
      Deferred DOE cost share— (105)
      Deferred revenue222 (773)
      Accrued compensation(2,596)(5,763)
Net cash used in operating activities(43,137)(33,151)
INVESTING CASH FLOW
Sale of short-term investments50,000 — 
Purchases of property, plant and equipment(351)(1,187)
Net cash provided by (used in) investing activities49,649 (1,187)
FINANCING CASH FLOW
Proceeds from exercise of common unit options— 470 
Repurchase of common units— (563)
Issuance of treasury units— 20 
Proceeds from exercise of warrants and common share options1,617 — 
Net cash provided by (used in) financing activities1,617 (73)
Net increase in cash, cash equivalents and restricted cash8,129 (34,411)
Cash, cash equivalents and restricted cash
Beginning of period244,217 77,094 
End of period$252,346 $42,683 
Summary of noncash investing and financing activities:
Conversion of equity options to liability award$— $1,540 
Long-term contract work in process in accounts payable16,018 — 
The accompanying notes are an integral part of these financial statements.
4

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)

1.Nature of Business
Organization and Operations
NuScale Power Corporation (“NuScale Corp”, the “Company”, “us”, “we” or “our”) is commercializing a modular, scalable 77 MWe (gross) light water reactor nuclear power plant using exclusive rights to a nuclear power plant design obtained from Oregon State University. The Company is majority owned by Fluor.

Merger with Spring Valley

In December 2021, NuScale LLC entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Spring Valley Acquisition Corp. (“Spring Valley”) and Spring Valley Merger Sub, LLC (“Merger Sub”), a wholly owned subsidiary of Spring Valley. Pursuant to the Merger Agreement, Merger Sub merged with and into NuScale LLC (the “Merger”), with NuScale LLC surviving the Merger (the “Surviving Company”), Spring Valley being renamed NuScale Corp, and NuScale LLC continuing to be held as a wholly controlled subsidiary of NuScale Power Corporation in an “Up-C” structure. On May 2, 2022, the Merger Agreement and Merger (collectively the “Transaction”) was completed.

The Transaction is shown as a reverse recapitalization under GAAP. Spring Valley is the acquired company, with NuScale LLC treated as the acquirer. This determination reflects Legacy NuScale Equityholders holding a majority of the voting power of NuScale Corp, NuScale LLC’s pre-merger operations being the majority post-merger operations of NuScale Corp, and NuScale LLC’s management team retaining similar roles at NuScale Corp. Accordingly, although Spring Valley is the legal parent company, GAAP dictates that the financial statements of NuScale Corp will represent a continuation of NuScale LLC’s operations, with the Transaction being treated as though NuScale LLC issued ownership interests for Spring Valley, accompanied by a recapitalization. The net assets of NuScale LLC are stated at historical cost, with no incremental goodwill or other intangible assets recorded for the effects of the Transaction with Spring Valley.
2.Summary of Significant Accounting Policies

Basis of Presentation
The Company’s unaudited condensed consolidated financial statements and related notes do not include notes and certain financial information normally presented annually under GAAP, and therefore should be read in conjunction with our 2022 Annual Report on Form 10-K. Accounting measures at interim dates inherently involve greater reliance on estimates than at year-end. Although such estimates are based on management’s most recent assessment of the underlying facts and circumstances utilizing the most current information available, our reported results of operations may not necessarily be indicative of results that we expect for the full year.
These financial statements are unaudited. In management’s opinion, they contain all adjustments of a normal recurring nature which are necessary to present fairly our financial position and our operating results as of and for the interim periods presented.

Principles of Consolidation

As part of the Transaction, NuScale Corp has been determined to be the primary beneficiary of NuScale Power, LLC (“NuScale LLC”), a variable interest entity (“VIE”). As the sole managing member of NuScale LLC, NuScale Corp has both the power to direct the activities, and direct ownership to share in the revenues and expenses of NuScale LLC. As such, all the activity of NuScale LLC has been consolidated in the accompanying condensed consolidated financial statements. All assets and liabilities included in the balance sheet are that of NuScale LLC, other than the NuScale Corp Warrants and certain prepaid insurance. All significant intercompany transactions have been eliminated upon consolidation.

5

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)
Changes in Presentation

Prior year amounts totaling $115, previously identified as Other cost share (interest expense) but currently described as Interest income (expense), have been reclassified to Sponsored other cost share to conform to the current year presentation on the accompanying condensed consolidated statements of operations.

Cash, Cash Equivalents and Restricted Cash

Cash equivalents represent short-term, highly liquid investments, which are readily convertible to cash and have maturities of three months or less at time of purchase. Cash equivalents with an initial maturity of between three and twelve months at time of purchase are presented as short-term investments on the accompanying condensed consolidated balance sheet. Cash equivalents and short-term investments consist of certificates of deposit. These certificates of deposit are classified as held-to-maturity, and the estimated fair value of the investment approximates its amortized cost.

Cash in the amount of $34,182 is restricted as collateral for the letter of credit associated with the Development Cost Reimbursement Agreement (“DCRA”) at March 31, 2023 (See Note 13). The DCRA spans multiple years requiring the amount to be classified as a noncurrent asset, included in Restricted cash in the accompanying condensed consolidated balance sheet. The Restricted cash balance plus Cash and cash equivalents on the accompanying condensed consolidated balance sheet equals cash, cash equivalents and restricted cash, as reflected in the accompanying condensed consolidated statements of cash flows.

Warrant Liability

The Company accounts for the Warrants in accordance with the guidance contained in Accounting Standards Codification (“ASC”) 815, “Derivatives and Hedging”, under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s condensed consolidated statements of operations. The fair value of the Public and Private Placement Warrants has been estimated using the Public Warrants’ quoted market price. See note 4 for further discussion of the terms of the Warrants and note 5 for further discussion of the methodology used to determine the value of the Warrants.

Sponsored cost share

As we continue to advance our commercialization activities, we have begun to enter into cost share agreements with various entities, including both governmental and private, whereby NuScale is reimbursed for specific R&D performed. Currently, these entities include the DOE, United State Trade and Development Agency (“USTDA”) and CFPP, among others.

Beginning in 2014, the U.S. DOE has provided critical funding to NuScale through a series of cooperative agreements which support ongoing commercialization activities. During the three months ended March 31, 2023 and 2022, DOE cost share totaled $12,354 and $20,462, respectively. Beginning in 2021, NuScale partnered with the USTDA to develop SMRs in foreign markets. Under the USTDA’s technical assistance grant program we receive cost share commitments to support licensing work in these foreign markets. During the three months ended March 31, 2023 and 2022, USTDA cost share totaled $2,415 and $115, respectively. Finally, we receive cost share from CFPP, LLC as a subrecipient under a contract between the DOE and UAMPS for R&D performed with the goal of developing our first SMR. Under this agreement we received cost share of $2,939 during the three months ended March 31, 2023, with no cost share during the same period in the prior year.

Income Taxes

NuScale Corp accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial
6

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)
statement carrying amounts of existing assets and liabilities and their respective tax bases. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that the deferred tax assets will be realized. Deferred tax assets and liabilities are calculated by applying existing tax laws and the rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the year of the enacted rate change.

The Company accounts for uncertainty in income taxes using a recognition and measurement threshold for tax positions taken or expected to be taken in a tax return, which are subject to examination by federal and state taxing authorities. The tax benefit from an uncertain tax position is recognized when it is more likely than not that the position will be sustained upon examination by taxing authorities based on technical merits of the position. The amount of the tax benefit recognized is the largest amount of the benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The effective tax rate and the tax basis of assets and liabilities reflect management’s estimates of the ultimate outcome of various tax uncertainties. Once identified, the Company will recognize penalties and interest related to uncertain tax positions within the provision (benefit) for income taxes line in the accompanying consolidated statements of operations.

NuScale LLC is a limited liability company treated as a partnership for U.S. federal income tax purposes that is not subject to U.S. federal income tax. As such, its net taxable income or loss and any related tax credits are allocated to its members.
3.Noncontrolling Interests and Loss Per Share
Noncontrolling Interests

Following the Transaction, holders of Class A common stock own direct controlling interest in the results of the combined entity, while the Legacy NuScale Equityholders own an economic interest in NuScale LLC, shown as noncontrolling interests (“NCI”) in equity in NuScale Corp’s condensed consolidated financial statements. The indirect economic interests are held by Legacy NuScale Equityholders in the form of NuScale LLC Class B Units. The following table summarizes the economic interests of NuScale Corp between the holders of Class A common stock and indirect economic interests held by NuScale LLC Class B unitholders as of and for the three months ended March 31, 2023:

7

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)
Noncontrolling InterestAs of and for the three months ended
March 31, 2023
NuScale Corp Class A common stock
   Beginning of period69,353,019 
      Conversion of combined interests into Class A common stock— 
      Exercise of options and warrants and vested RSUs708,036 
   End of period70,061,055 
NuScale LLC Class B Units (NCI)
   Beginning of period157,090,820 
     Conversion of combined interests into Class A common stock— 
  End of period157,090,820 
Total
   Beginning of period226,443,839 
      Conversion of combined interests into Class A common stock— 
      Exercise of options and warrants and vested RSUs708,036 
   End of period227,151,875 
Ownership Percentage
NuScale Corp Class A common stock
   Beginning of period30.6 %
   End of period30.8 %
NuScale LLC Class B Units (NCI)
   Beginning of period69.4 %
   End of period69.2 %
The NCI may decrease according to the number of shares of Class B common stock and NuScale LLC Class B units that are exchanged for shares of Class A common stock or, in certain circumstances including at the election of NuScale Corp, cash in an amount equal to the fair value of Class A common stock received in a contemporaneous equity issuance. After each exchange, NuScale LLC equity attributable to NuScale Corp is rebalanced to reflect the change in ownership percentage, which is calculated above based on Class B units and Class A shares, as a percentage of Combined interests.

Loss Per Share

Prior to the Transaction, the membership structure of NuScale LLC included units that had profit interests. The Company analyzed the calculation of net loss per unit for periods prior to the Transaction and determined that it resulted in values that would not be meaningful to the readers of these financial statements. Therefore, net loss per unit information has not been presented for periods prior to May 2, 2022.

8

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)
Basic loss per share is based on the average number of shares of Class A common stock outstanding during the period. Diluted loss per share is based on the average number of shares of Class A common stock used for the basic earnings per share calculation, adjusted for the dilutive effect of RSUs, Stock Options and Warrants using the “treasury stock” method and for all other interests that convert into potential shares of Class A common stock, if any, using the “if converted” method. Net loss attributable to Class A common stockholders for diluted loss per share is adjusted for the Company’s share of NuScale LLC’s net loss, net of NuScale Corp taxes, after giving effect to all other interests that convert into potential shares of Class A common stock, to the extent it is dilutive. In addition, net loss attributable to Class A common stockholders for diluted loss per share is adjusted for the after-tax impact of changes to the fair value of derivative liabilities, to the extent the Company’s Warrants are dilutive.

The following table sets forth the computation of basic and diluted net loss per share of Class A common stock and represents the three months ended March 31, 2023, the period where the Company had Class A and Class B common stock outstanding. Class B common stock represents a right to cast one vote per share at the NuScale Corp level, and carry no economic rights, including rights to dividends or distributions upon liquidation, and as a result, is not considered a participating security for basic and diluted loss per share. As such, basic and diluted loss per share of Class B common stock has not been presented.

Three Months Ended March 31, 2023
Net loss attributable to Class A common stockholders$(10,962)
Weighted-average shares for basic and diluted loss per share69,684,268 
Basic and Diluted loss per share of Class A common stock$(0.16)
Anti-dilutive securities excluded from shares outstanding:
    Class B common shares157,090,820 
    Stock options 11,447,940 
    Warrants18,458,701 
    Time-based RSUs3,910,760 
Total190,908,221 

4.Warrant Liabilities
As of March 31, 2023, the Company had 9,558,701 Public Warrants and 8,900,000 Private Placement Warrants outstanding.

Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Warrants. The Warrants are currently exercisable and will expire five years from the date of the Transaction or earlier upon redemption or liquidation.

Redemption of Warrants when the price per share of Class A common stock equals or exceeds $18.00. The Company may redeem the outstanding Warrants (except as described with respect to the Private Placement Warrants):
•in whole and not in part;
•at a price of $0.01 per Warrant;
•upon a minimum of 30 days’ prior written notice of redemption to each Warrant holder; and
•if the closing price of the Class A common stock equals or exceeds $18.00 per share (as adjusted) for any 20 trading days within a 30-trading day period ending three trading days before the Company sends the notice of redemption to the Warrant holders.

If and when the Warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws.

9

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)
Redemption of Warrants when the price per share of Class A common stock equals or exceeds $10.00. The Company may redeem the outstanding warrants:
•in whole and not in part;
•at $0.10 per Warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their Warrants on a cashless basis prior to redemption and receive that number of shares determined based on the redemption date and the fair market value of the Class A common stock;
•if, and only if, the closing price of the Class A common stock equals or exceeds $10.00 per public share (as adjusted) for any 20 trading days within the 30-trading day period ending three trading days before the Company sends the notice of redemption to the Warrant holders; and
•if the closing price of the Class A common stock for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the Warrant holders is less than $18.00 per share (as adjusted), the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants.

If the Company calls the Public Warrants for redemption, as described above, the exercise price and number of ordinary shares issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger, or consolidation.

Beginning on the 30th day following the Transaction, the Private Placement Warrants became almost identical to the Public Warrants sold in the Spring Valley Initial Public Offering. Additionally, the Private Placement Warrants are exercisable on a cashless basis and are non-redeemable, except as described above, so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.
5.Fair Value Measurement
The Company measures certain financial assets and liabilities at fair value. Fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the Company uses a three-level hierarchy, which prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach and cost approach).
The levels of hierarchy are described below:
Level 1 Quoted prices in active markets for identical instruments;
Level 2 Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
Level 3 Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. Financial assets and liabilities are classified in their entirety based on the most stringent level of input that is significant to the fair value measurement.
The carrying amount of certain financial instruments, including deposits, accounts payable, accrued expenses and convertible notes payable approximates fair value due to their short maturities.

Our Warrants are accounted for as liabilities pursuant to ASC 815-40 and are measured at fair value as of each reporting period. Changes in fair value of the Warrants are recorded in the consolidated statements of operations each period. Due to the similarity of the features of the Public and Private Warrants, management has concluded that the
10

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)
price of the Public Warrants would be used in the valuation of the Private Placement Warrants. However, since the two types of Warrants are not identical and the Private Warrants are not actively traded, we have classified the Private Placement Warrants as Level 2, while the Public Warrants are classified as Level 1.

The following table represents the Company’s financial liabilities measured at fair value on a recurring basis as of March 31, 2023:

(in thousands)Level 1Level 2Level 3Total
Warrant Liabilities: 
Public Warrants$15,772 $— $— $15,772 
Private Placement Warrants— 14,685 — 14,685 
Total Warrant Liabilities as of March 31, 2023$15,772 $14,685 $— $30,457 
6.Accounts and Other Receivables
Accounts and other receivables include reimbursement requests outstanding from the DOE awards, interest receivable and commercial accounts receivable associated with other federal projects. The DOE reimbursement requests are recognized as eligible costs are incurred. Reimbursement under the awards is recognized as award funds are obligated, and are included in Department of Energy Cost Share in the consolidated statement of operations. Interest receivable of $329 was outstanding at March 31, 2023.

The majority of our receivables are either due from the U.S. federal government or have to do with a federal project. For these reasons, all receivables are deemed to be fully collectible and no allowance has been recorded.
7.Property, Plant and Equipment
Property, plant and equipment consisted of the following:
March 31,December 31,
(in thousands)
20232022
Furniture and fixtures$145 $173 
Office and computer equipment7,475 7,393 
Software13,918 13,864 
Test equipment347 347 
Leasehold improvements2,281 2,312 
24,166 24,089 
Less: Accumulated depreciation(19,947)(19,431)
Add: Assets under development287 112 
Net property, plant and equipment$4,506 $4,770 
8.Long-Term Contract Work In Process

During the first quarter, we entered into a long lead material contract with Carbon Free Power Project, LLC (“CFPP LLC”). Related to this contract, the Company has subcontracted for the purchase of certain long-lead materials in the amount of $54,600, that will be used in fabricating of the NPMs as part of the overall contract with CFPP LLC. This first phase of the project will be completed for CFPP, LLC near the end of 2024. The subcontractor is manufacturing the long-lead materials on behalf of NuScale, and we are considered the principal, rather than agent, under ASC 606, Revenue from Contracts with Customers. The contract contains one performance obligation that will be satisfied once the materials are verified as received at the fabricator’s facility. As of March 31, 2023, $14,200 has been capitalized in the Long-term contract work in process line item on our consolidated balance sheet related to this contract.
11

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)
Subsequent to March 31, 2023, upon meeting certain contract milestones, we have billed CFPP LLC $22,275, which will be classified as a long-term Deferred revenue liability on our consolidated balance sheet.
9.Employee Benefits
NuScale sponsors a defined contribution 401(k) Plan with Company contributions to be made at the sole discretion of management. Under the provisions of the 401(k) Plan, the Company matches the employees’ contributions for the first 3% of compensation and matches 50% of the employees’ contributions for the next 2% of compensation. The expense recorded for the 401(k) Plan was $751 and $672 for the three months ended March 31, 2023 and 2022, respectively.
10.Income Taxes
NuScale LLC was historically, and remains a partnership for U.S. federal income tax purposes with each partner being separately taxed on its share of taxable income or loss. NuScale Corp is subject to U.S. federal income taxes, in addition to state and local income taxes, with respect to its distributive share of any net taxable income or loss and any related tax credits of NuScale LLC.

The effective tax rate was 0% for the three months ended March 31, 2023. The effective income tax rate for the three months ended March 31, 2023 differed significantly from the statutory rates, primarily due to the losses allocated to NCI and the recognition of a valuation allowance as a result of the Company’s new tax structure following the Transaction.

There was no income tax expense recorded during the three months ended March 31, 2023.

The Company has assessed the realizability of the net deferred tax assets and in that analysis has considered the relevant positive and negative evidence available to determine whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The Company has recorded a full valuation allowance against the deferred tax assets at NuScale Corp as of March 31, 2023, which will be maintained until there is sufficient evidence to support the reversal of all or some portion of these allowances.

The Company’s income tax filings will be subject to audit by various taxing jurisdictions. The Company will monitor the status of U.S. federal, state and local income tax returns that may be subject to audit in future periods. No U.S. federal, state and local income tax returns are currently under examination by the respective taxing authorities.

In August 2022, the Inflation Reduction Act, or IRA, was enacted which includes the following key summary provisions: (i) a 15% Corporate Alternative Minimum Tax, or CAMT, that allows an offset of up to 75% with existing tax credit carryforwards, (ii) excise tax applicable to certain stock repurchases including ordinary buy backs and open market repurchases, (iii) extension and expansion of clean energy credits and incentives, and (iv) indefinite carryover of the CAMT. This legislation also provides transferability opportunities for certain newly generated credits as well as a direct pay option. For the three months ended March 31, 2023, the enactment of the IRA did not result in any material adjustment to our income tax provision.

11.Equity-Based Compensation
The total compensation expense recognized for common share options and time-based RSU awards during the three months ended March 31, 2023 and 2022 was $3,637 and $1,021, respectively. This includes G&A expense of $1,493 and other expense of $2,144 for the three months ended March 31, 2023 and $444 of G&A expense and $577 in other expense for the three months ended March 31, 2022.

Effective January 1, 2023, the share pool was automatically increased by 8,972,128, which is the number of shares of Class A common stock equal to four percent (4%) of the aggregate number of shares of Class A common stock and Class B common stock outstanding on December 31, 2022, excluding any such outstanding shares of Class A common
stock that were granted under the 2022 long-term incentive plan and remain unvested and subject to forfeiture as of December 31, 2022.

12

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)
Stock Options

The following table summarizes the activity of the Company’s common stock options as of and for the three months ended March 31, 2023:
Share OptionsNumber of
Shares		Weighted Average
Exercise Price
Outstanding at December 31, 2022
12,224,783 $4.09 
Granted— — 
Exercised(693,734)2.30 
Forfeited(80,674)6.43 
Expired(2,435)5.54 
Outstanding at March 31, 2023
11,447,940 4.18 
Exercisable at March 31, 2023
10,379,278 3.90 

The Company measures the fair value of each share option grant at the date of grant using a Black-Scholes option pricing model.

Time-based RSUs

During the three months ended March 31, 2023, the Board approved 1,835,016 employee RSU awards that vest one-third annually starting in February 2024 for a period of three years. The following table summarizes the activity of the Company’s time-based RSUs as of and for the three months ended March 31, 2023:
Number of RSUsWeighted Average
Time-based RSUsGrant-Date Fair Value
Outstanding at December 31, 20222,140,651 $10.71 
Granted1,835,016 10.35 
Vested(14,300)10.20 
Forfeited/Expired(50,607)11.12 
Outstanding at March 31, 20233,910,760 $10.54 

Common Unit Appreciation Rights

In April 2013, the Company granted its Chief Executive Officer 1,000,000 NuScale LLC common unit appreciation rights (“UARs”). The UARs vested one-third each year on the anniversary of the grant date. Upon exercise of a UAR, the holder would receive common units equal to the excess of the fair value of the common units over the strike price of $0.11 at the grant date multiplied by the number of rights exercised and divided by the fair value of the common unit upon exercise.

In February 2022, the NuScale LLC Board of Managers approved a $1,540 cash payment (paid during the three months ended June 30, 2022) in lieu of equity issuance related to the UARs, which triggered recognition of $1,490 of equity-based compensation expense, included in G&A, during the three months ended March 31, 2022.

12.Related Party Transactions
From time to time, the Company enters into strategic agreements with Fluor, whereby Fluor or NuScale perform services for one another. For the three months ended March 31, 2023 and 2022, NuScale incurred expenses of $8,726 and $3,601, respectively. As of March 31, 2023 and December 31, 2022, NuScale owes Fluor, as accounts payable and accrued expenses on the condensed consolidated balance sheet, amounts totaling $9,162 and $7,694, respectively. For
13

NuScale Power Corporation
Notes to the Unaudited Condensed Consolidated Financial Statements
(in thousands, except shares and per share amounts)
the three months ended March 31, 2023 and 2022, NuScale earned revenue of $4,014 and $1,561, respectively. As of March 31, 2023 and December 31, 2022, Fluor owes NuScale $6,101 and $1,508, respectively, amounts which are included in accounts and other receivables on the condensed consolidated balance sheet.

For the three months ended March 31, 2023 Fluor accounted for 72.9% of total revenue.
13.Commitments and Contingencies

In the regular course of business, the Company is involved in various legal proceedings and claims incidental to the normal course of business. Additionally, the Company is involved in various legal proceedings and claims relating to the Transaction with Spring Valley. These legal proceedings relate to the level of disclosure of matters prior to the Transaction, which the Company believes were timely addressed well before the Transaction. The Company does not believe that any of the claims are material to the Company. Management does not believe that resolution of any of these matters will materially affect the Company’s financial position or results of operations.

On September 19, 2022, thirteen purported members of NuScale LLC filed suit in the U.S. District Court for the District of Oregon against NuScale LLC, Fluor Enterprises, Japan NuScale Innovation, Inc., and Sargent & Lundy Holdings, LLC. The plaintiffs purport to represent a class of individuals who held common units or options to purchase common units in NuScale LLC and seek declaratory relief and damages based on breach of contract and other common law claims. The claims are based on amendments to the operating agreement of NuScale LLC in connection with the Merger between NuScale LLC and Spring Valley Acquisition Corp. Plaintiffs claim, among other things, that such amendments breached NuScale LLC’s 5th Amended and Restated Operating Agreement and required the consent of holders of common units in NuScale LLC voting as a separate class. NuScale LLC filed a motion to dismiss the complaint on November 21, 2022. Plaintiffs filed a response on January 17, 2023, and NuScale LLC filed a reply on February 14, 2023. While no assurance can be given as to the ultimate outcome of this matter, the Company does not believe it is probable that a loss will be incurred and the Company has not recorded any liability as a result of these actions.

In conjunction with DOE Office of Nuclear Energy Award DE-NE0008935 with Utah Associated Municipal Power Systems’ (“UAMPS”) wholly owned subsidiary, CFPP LLC, the Company entered into a DCRA, pursuant to which it is developing the NRC license application and performing other site licensing and development activities. Under the DCRA, the Company may be obligated to refund to UAMPS a percentage of its net development costs up to a specified cap, which varies based on the stage of project development, if certain performance criteria are not met. As of March 7, 2023, when the Company entered into Amendment 3 of the DCRA and the Long Lead Material Reimbursement Agreement with CFPP LLC, the maximum reimbursement based on the current stage of project development was $81,000. As of March 31, 2023 the net development costs incurred by UAMPS totaled $29,805.

Under the DCRA, the Company is required to have credit support to fund the amount of its potential reimbursement of these net development costs. A stipulation of obtaining the letter of credit is for the Company to segregate funds from the operating bank accounts as collateral for the letter of credit. This account is identified as restricted cash in the amount of $34,182, on the accompanying consolidated balance sheet and acts as collateral for the $33,500 letter of credit outstanding at March 31, 2023. On April 17, 2023, this letter of credit was increased to $44,200.

In December 2022, NuScale and Fluor provided CFPP LLC with the results of an economic competitiveness test (“ECT”) comparing the calculated levelized cost of electricity (“LCOE”) for the Carbon Free Power Project (the “CFPP”) with the price target of $58.00/MWh as provided for under the amended DCRA. The LCOE exceeded the price target, meaning there was an ECT Failure. As a result of the ECT Failure UAMPS Members participating in the CFPP were given the opportunity to exit the Project. CFPP LLC had until March 1, 2023 to deliver notice that it intended to terminate its participation in the Project. If CFPP LLC had issued notice that it intended to terminate its participation in the Project by March 1, 2023, the Company could have been liable to pay CFPP LLC approximately $29,805 and the Company would then have had the option to take over the Project assets and continue to develop the CFPP. However, on March 1, 2023, UAMPS notified NuScale confirming that sufficient Project Participants have opted to continue with CFPP development notwithstanding the ECT failure. The next ECT is scheduled to be run in conjunction with the submission of the Class 2 Project Cost Estimate.
14

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of the financial condition and results of operations of NuScale Power Corporation (“NuScale Corp”) should be read together with our 2022 Annual Report on Form 10-K and with the financial statements included in this Quarterly Report on Form 10-Q. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those projected in these forward-looking statements as a result of various factors. Unless the context otherwise requires, references in this section to “NuScale,” “us,” “our” or “we” refer to NuScale Power, LLC (“NuScale LLC”) prior to the Transaction, and to NuScale Power Corporation (“NuScale Corp”) following the consummation of the Transaction.
Overview
Our mission is to provide scalable advanced nuclear technology to produce electricity, heat and clean water to improve the quality of life for people around the world. We are changing the power that changes the world by creating an energy source that is smarter, cleaner, safer and cost competitive.
Our small modular reactor (“SMR”), known as NuScale Power Module (“NPM”), provides a scalable power plant solution incorporating enhanced safety, improved affordability and extended flexibility for diverse electrical and process heat applications. Our scalable design provides carbon-free energy at a reduced cost when compared with gigawatt-sized nuclear facilities.
Since our founding in 2007, we have made significant progress towards commercializing the first SMR in the United States. In 2017, we submitted our Design Certification Application (“DCA”) to the U.S. Nuclear Regulatory Commission (“NRC”). On August 28, 2020, the NRC issued its Final Safety Evaluation Report, representing the NRC’s completion of its technical review. On September 11, 2020 the NRC issued its Standard Design Approval (“SDA”) of our NPM and scalable plant design. With this phase of NuScale’s DCA now complete, customers may proceed with plans to develop NuScale power plants with the understanding that the NRC has approved the safety aspects of the NPM and plant design. We expect our operating losses and negative operating cash flow to grow until the commercialization of the NPM. On January 19, 2023, the NRC published in the Federal Register a final rule that certifies NuScale’s SMR design for use in the United States, which became effective 30 days after publication.

Merger with Spring Valley

In December 2021, NuScale LLC entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Spring Valley Acquisition Corp. (“Spring Valley”) and Spring Valley Merger Sub, LLC (“Merger Sub”), a wholly owned subsidiary of Spring Valley. Pursuant to the Merger Agreement, Merger Sub merged with and into NuScale LLC (the “Merger”), with NuScale LLC surviving the Merger (the “Surviving Company”), Spring Valley being renamed NuScale Corp, and NuScale LLC continuing to be held as a wholly controlled subsidiary of NuScale Power Corporation in an “Up-C” structure. On May 2, 2022, the Merger Agreement and Merger (collectively the “Transaction”) was completed.

The Transaction is shown as a reverse recapitalization under GAAP. Spring Valley is the acquired company, with NuScale LLC treated as the acquirer. This determination reflects Legacy NuScale Equityholders holding a majority of the voting power of NuScale Corp, NuScale LLC’s pre-merger operations being the majority post-merger operations of NuScale Corp, and NuScale LLC’s management team retaining similar roles at NuScale Corp. Accordingly, although Spring Valley is the legal parent company, GAAP dictates that the financial statements of NuScale Corp will represent a continuation of NuScale LLC’s operations, with the Transaction being treated as though NuScale LLC issued ownership interests for Spring Valley, accompanied by a recapitalization. The net assets of NuScale LLC are stated at historical cost, with no incremental goodwill or other intangible assets recorded for the effects of the Transaction with Spring Valley.

The following table provides the historical cost of the assets and liabilities assumed as a result of the Transaction:

Cash$341,462 
Warrant liabilities(47,532)
   Total net assets$293,930 
15

Results of Operations
(in thousands)Three Months Ended March 31,
20232022
Revenue$5,505 $2,445 
Cost of sales(3,416)(1,205)
    Gross margin2,089 1,240 
Research and development expenses25,715 24,380 
General and administrative expenses14,695 10,520 
Other expenses17,151 10,188 
    Loss from operations(55,472)(43,848)
Sponsored cost share17,873 20,577 
Decrease (increase) in fair value of warrant liabilities(1,108)— 
Interest income (expense)3,097 (102)
   Loss before income taxes$(35,610)$(23,373)
Comparison of the Three Months Ended March 31, 2023 and 2022

Changes in Presentation

Prior year amounts totaling $115, previously identified as Other cost share (interest expense) but currently described as Interest income (expense), have been reclassified to Sponsored other cost share to conform to the current year presentation on the accompanying condensed consolidated statements of operations.

Revenue

The increase in revenue was attributable to activities in support of the EPCDA for CFPP, as well as nuclear technologies consulting services.

General and Administrative
G&A expenses increased as a result of $1.2 million in accounting, advertising and marketing expenses, $0.8 million of higher insurance costs, $1.1 million in equity-based compensation and $0.8 million in compensation costs.
Other

Other expenses increased by $4.0 million in compensation costs resulting from department restructuring and adding operational supervisory staff to support commercialization, $1.5 million in equity-based compensation and $1.4 million in software and hardware expenses.

Sponsored cost share
The DOE cost share decreased by $8.1 million as a result of decreased funding in the current year combined with a lower cost share percentage during the 2023 fiscal year. This was partially offset be new cost share agreements with various entities.

Interest income (expense)

The increase is due to $3.1 million of interest income earned on certificates of deposit.

16

Liquidity and Capital Resources
Liquidity
We measure liquidity in terms of our ability to fund the cash requirements of our R&D activities and our near-term business operations, including our contractual obligations and other commitments. Our current liquidity needs primarily involve R&D activities for the ongoing development of the NPM and associated plant design.
We had $218.2 million in cash and cash equivalents as of March 31, 2023, compared to $217.7 million as of December 31, 2022. We had no debt on either date.
Since NuScale’s inception, we have incurred significant operating losses; we have had negative operating cash flow during the three months ended March 31, 2023 and 2022; and we have an accumulated deficit of $193.1 million as of March 31, 2023. Management expects that operating losses and negative cash flows may increase because of additional costs and expenses related to the development of technology and the development of market and strategic relationships with other companies.

To date, we have not generated any material revenue. We do not expect to generate any meaningful revenue unless and until we are able to commercialize our NPM and related services. We expect our costs to increase in connection with the advancement of our products and services toward commercialization. In addition, with the completion of the Transaction, we expect to incur additional costs associated with operating as a public company. While we believe that the proceeds of the Transaction will be sufficient to reach commercialization of our NPM, certain costs are not reasonably estimable at this time, and we may require additional funding and our projections anticipate certain customer-sourced income that is not assured and DOE funds that are granted under the cooperative agreement secured by the Company are subject to Congressional appropriations. Further, the debt ceiling and appropriations discussions currently taking place within Congress could have a material impact on the Company’s cash projections.

We believe that based on our current level of operating expenses and currently available cash resources, we will have sufficient funds available to cover R&D activities and operating cash needs for the next twelve months. However, considering that we have not yet completed the development of a commercial product and have no meaningful revenue to date, we may require additional funds in future years. Our ability to raise funds through equity offerings may be limited by the significant number of shares that may be publicly sold, including the shares registered for resale under the registration statement on Form S-1 that was declared effective by the SEC on June 30, 2022. Such sales may negatively affect the market price of our shares of Class A common stock. In particular, a large sale by Fluor, our majority shareholder, could significantly affect our stock price. We believe the likelihood that Warrant holders will exercise their Warrants, and therefore the amount of cash proceeds that we would receive from such exercises, depends on the trading price of our shares of Class A common stock, which from time to time, has exceeded the $11.50 Warrant exercise price, before the Warrants expire. In certain circumstances, the Warrants can be exercised on a cashless basis. Our ability to fund R&D activities and our operating cash needs for multiple years does not depend on the proceeds we may receive as the result of exercises of Warrants.
17

Comparison of Cash Flows for the Three Months Ended March 31, 2023 and 2022
The following table sets forth the primary sources and uses of cash, cash equivalents and restricted cash for the periods presented below:
Three Months Ended March 31,
(in thousands)20232022
Net cash used in operating activities$(43,137)(33,151)
Net cash provided by (used in) investing activities49,649 (1,187)
Net cash provided by (used in) financing activities1,617 (73)
Net increase in cash, cash equivalents and restricted cash (A)
$8,129 $(34,411)
(A) Includes $34,182 in restricted cash
Cash Flows used in Operating Activities
Our operating cash flow decreased during the three months ended March 31, 2023 due to a build up of receivables associated with our cost share and commercial work.
Cash Flows from Investing Activities

The $50.0 million of cash provided by investing activities resulted from the maturity, and sale, of our 6 month certificates of deposit during the three months ended March 31, 2023.

Capital Resources
In conjunction with DOE Office of Nuclear Energy Award DE-NE0008935 with Utah Associated Municipal Power Systems’ (“UAMPS”) wholly owned subsidiary, Carbon Free Power Project, LLC (“CFPP LLC”), we entered into a Development Cost Reimbursement Agreement (“DCRA”), pursuant to which we are developing the NRC license application and performing other site licensing and development activities. Under the DCRA, we may be obligated to refund to UAMPS a percentage of its net development costs up to a specified cap, which varies based on the stage of project development, if certain performance criteria are not met. As of March 7, 2023, when we entered into Amendment 3 of the DCRA and the Long Lead Material Reimbursement Agreement with CFPP LLC, the maximum reimbursement based on the current stage of project development is $81.0 million. As of March 31, 2023 the net development costs incurred by UAMPS totaled $29.8 million.

Under this agreement, the Company is required to have credit support to fund the amount of our potential reimbursement of these net development costs. This letter of credit is updated quarterly based on an agreed upon forecasted estimate of net development costs. A stipulation of attaining the letter of credit requires the Company segregate funds from the operating bank accounts as collateral for said letter of credit. This account is identified as restricted cash in the amount of $34.2 million, on the accompanying condensed consolidated balance sheet and acts as collateral for the $33.5 million letter of credit outstanding at March 31, 2023.

In December 2022, NuScale and Fluor provided CFPP LLC with a Class 3 Project Cost Estimate (“PCE”). As provided for in the DCRA (as amended), NuScale ran an economic competitiveness test (“ECT”) comparing the PCE with a price target of $58.00/MWh for a target COD of the Project. The PCE exceeded the price target, meaning there was an ECT failure. As a result of the ECT failure UAMPS Members participating in the CFPP (“Project Participants”) were given the opportunity to exit the Project. CFPP LLC had until March 1, 2023 (unless extended by mutual agreement), to deliver notice that it intended to terminate its participation in the Project. If CFPP LLC had issued notice that it intended to terminate its participation in the Project by March 1, 2023, the Company would have been liable to pay CFPP LLC approximately $29.8 million and would have had the option to take over the Project assets and continue to develop CFPP. However, on March 1, 2023, UAMPS notified NuScale that sufficient Project Participants have opted to continue with CFPP development notwithstanding the ECT failure. The next ECT is scheduled to be run in conjunction with the submission of the Class 2 PCE. For information regarding the consequences of an ECT failure, see Commercialization Risk Factors associated with the Company’s obligations to UAMPS.
18

Recent Accounting Pronouncements
Management believes there is no new accounting guidance issued but not yet effective that would have a material impact to the Company’s current financial statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes from the discussion of the Company’s market risk in Part I, Item 7A., Quantitative and Qualitative Disclosures About Market Risk, of the Company’s 2022 Annual Report Form 10-K.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the period ended March 31, 2023, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation, our principal executive officer and principal financial officer have concluded that, as of the evaluation date, our disclosure controls and procedures were effective as of March 31, 2023. Accordingly, management believes that the financial statements included in this Form 10-Q present fairly in all material respects our financial position, results of operations and cash flows for the period presented.

Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.


19

Part II - Other Information
Item 1. Legal Proceedings

In the regular course of business, the Company is involved in various legal proceedings and claims incidental to the normal course of business. Additionally, we are involved in various legal proceedings and claims relating to the Transaction. These legal proceedings relate to the level of disclosure of matters prior to the Transaction, which the Company believes were timely addressed well before the Transaction. We do not believe that any of the claims are material to the Company. Management does not believe that resolution of any of these matters will materially affect the Company’s financial position or results of operations.

On September 19, 2022, thirteen purported members of NuScale LLC filed suit in the U.S. District Court for the District of Oregon against NuScale LLC, Fluor Enterprises, Japan NuScale Innovation, Inc., and Sargent & Lundy Holdings, LLC. The plaintiffs purport to represent a class of individuals who held common units or options to purchase common units in NuScale LLC and seek declaratory relief and damages based on breach of contract and other common law claims. The claims are based on amendments to the operating agreement of NuScale LLC in connection with the Merger between NuScale LLC and Spring Valley Acquisition Corp. Plaintiffs claim, among other things, that such amendments breached NuScale LLC’s 5th Amended and Restated Operating Agreement and required the consent of holders of common units in NuScale LLC voting as a separate class. NuScale LLC filed a motion to dismiss the complaint on November 21, 2022. Plaintiffs filed a response January 17, 2023, and NuScale LLC filed a reply on February 14, 2023. While no assurance can be given as to the ultimate outcome of this matter, we do not believe it is probable that a loss will be incurred and we have not recorded any liability as a result of these actions.
Item 1A. Risk Factors
There have been no material changes from our risk factors as disclosed in the 2022 Annual Report on Form 10-K.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Not applicable
Item 3. Defaults Upon Senior Securities
Not applicable
Item 4. Mine Safety Disclosures
Not applicable
Item 5. Other Information
Not applicable
20

Item 6. Exhibits and Financial Statements Schedules
(a)Exhibits.
Exhibit
Number		Description
3.1
3.2
4.1
4.2
10.1
10.2
31.1
31.2
32.1
32.2
101 .INS XBRL Instance Document
101.SCH XBRL Taxonomy Extension Schema Document
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF XBRL Taxonomy Extension Definition Linkbase Document
101.LAB XBRL Taxonomy Extension Label Linkbase Document
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document
104 Cover Page Interactive Data File (formatted as Inline XBRL).
__________________________________________



21

SIGNATURES
NuScale Power Corporation
DateBy:/s/ John Hopkins
May 9, 2023Name:John Hopkins
Title:Chief Executive Officer
DateBy:/s/ Chris Colbert
May 9, 2023NameChris Colbert
Title:Chief Financial Officer
22
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