Special Purpose Acquisition Company

9 Months Ended

Sep. 30, 2025

Note 14 Special Purpose Acquisition Company

Nabors Energy Transition Corp. II (“NETC II”) is our SPAC co-sponsored by Nabors and Greens Road Energy II LLC. Greens Road Energy II LLC is owned by certain members of Nabors’ management team and board members. In July 2023, NETC II completed its initial public offering of 30,500,000 units at $10.00 per unit, generating gross proceeds of approximately $305.0 million. Simultaneously with the closing of the IPO, NETC II completed the private sale of an aggregate of 9,540,000 warrants for an aggregate value of $9.5 million and issued unsecured promissory notes for an aggregate amount of $3.1 million. As part of the initial public offering of NETC II and subsequent private placement warrant transactions, $308.1 million was deposited in an interest-bearing U.S. based trust account (“Trust Account”) on July 18, 2023.

In February 2025, NETC II entered into a definitive agreement for a business combination with e2Companies LLC, a leading provider of integrated solutions for on-site power generation, distribution and energy cost-optimization. Completion of the proposed transaction is subject to closing conditions.

On July 11, 2025, NETC II and Merger Sub, LLC (“Merger Sub”), a wholly owned subsidiary of Nabors Energy Transition Sponsor II LLC (the “Sponsor”), filed a complaint against e2 in the Delaware Court of Chancery (the “Complaint”) alleging that e2 breached the business combination agreement by, among other things, delaying in completing its obligations to assist with required regulatory filings and otherwise delaying in completing the business combination, engaging in non-ordinary course transactions without NETC II’s consent, and failing to provide required financials to NETC II. On October 14, 2025, NETC II, e2, the Sponsor and Merger Sub entered into the Settlement Agreement and Release pursuant to which (i) e2 issued a secured promissory note to NETC II in an aggregate principal amount of $29.23 million and (ii) the parties agreed to dismiss the Complaint with prejudice.

In July 2025, NETC II held an extraordinary general meeting which approved, among other things, a proposal to extend the date NETC II has to consummate an initial business combination to July 18, 2026. In connection with the meeting, $186.7 million of the holdings held in the Trust Account were redeemed.

The SPAC’s funds held in a Trust Account are invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invests only in direct U.S. government treasury obligations. The funds in the Trust Account will only be released to the SPAC upon completion of a business combination or in connection with redemptions of any of the redeemable common shares, except with respect to interest earned on the funds which may be withdrawn to pay the SPAC’s taxes.

The company accounts for the non-controlling interest in the SPAC as subject to possible redemption in accordance with FASB ASC Topic 480 “Distinguishing Liabilities from Equity.” The SPAC’s common stock features certain redemption rights, which are considered to be outside the company’s control and subject to occurrence of uncertain future events. Nabors will recognize any future changes in redemption value immediately as they occur – i.e., adjusting the carrying amount of the instrument to its current redemption amount at each reporting period.

The SPAC is a consolidated VIE included in the accompanying consolidated financial statements under Restricted cash held in trust and Redeemable noncontrolling interest in subsidiary. As of September 30, 2025 and December 31, 2024, the Trust Account balance and non-controlling interest subject to possible redemption was $154.2 million and $331.8 million, respectively. NETC II’s non-controlling interest subject to possible redemption is presented at full redemption value as mezzanine equity, outside of the stockholders’ equity section in the accompanying consolidated financial statements.

The following table summarizes NETC II’s effects on changes in non-controlling interest subject to possible redemption.


	2025		2024

	(In thousands)
Balance, beginning of year	$	331,781	$	315,488
Redemptions		(186,655)		—
Net earnings		8,283		12,521
Nabors deemed dividends to SPAC public shareholders		750		—
Balance as of September 30	$	154,159	$	328,009

NABORS INDUSTRIES LTD 10-Q