Nabors Industries Ltd. (NYSE:NBR) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement
Exchangeable Notes Offering
On January9, 2017, Nabors Industries,Inc. (NII), a wholly owned
subsidiary of Nabors Industries Ltd. (NIL), and NIL entered into
a purchase agreement (the Purchase Agreement) under which NII
agreed to sell$500,000,000 aggregate principal amount of its
0.75% Exchangeable Senior Notes due January15, 2024 (the
Exchangeable Notes) to the initial purchasers named in the
Purchase Agreement (the Initial Purchasers). The Exchangeable
Notes are fully and unconditionally guaranteed by NIL. The
closing of the sale of the Exchangeable Notes is expected to
occur on or about January13, 2017, subject to the satisfaction of
customary closing conditions. In addition, NII granted the
Initial Purchasers a 30-day option to purchase up to an
additional $75,000,000 in aggregate principal amount of the
Exchangeable Notes on the same terms and conditions, solely to
cover over-allotments, if any. A copy of the Purchase Agreement
is included as Exhibit10.1 to this Form8-K and is incorporated in
this Item 1.01 by reference. The Purchase Agreement should be
read in its entirety for a complete description of its provisions
and the summary in this report is qualified in its entirety by
the text of such provisions.
The Exchangeable Notes will be exchangeable under certain
circumstances for cash, common shares of NIL or a combination of
cash and common shares of NIL, at NIIs election. NII may redeem
the Exchangeable Notes, in whole but not in part, in connection
with certain tax-related events (a tax redemption), at a
redemption price equal to 50% of the principal amount of the
Exchangeable Notes plus accrued and unpaid interest to, but
excluding, the redemption date.
The exchange rate will initially be 39.7488 common shares of NIL
per $1,000 principal amount of the notes (equivalent to an
initial exchange price of approximately $25.16 per common share
of NIL). The exchange rate will be subject to adjustment in some
events but will not be adjusted for any accrued and unpaid
interest. In addition, following certain corporate events that
occur prior to the maturity date or upon notice of a tax
redemption, the Exchange Rate will increase the exchange rate for
a holder who elects to exchange its Exchangeable Notes in
connection with such a corporate event or tax redemption in
certain circumstances.
NII will sell the Exchangeable Notes through a private offering
to qualified institutional buyers to the exemption from
registration provided by Rule144A under the Securities Act of
1933, as amended (the Securities Act).
This disclosure does not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall it
constitute an offer to sell, solicitation or sale in any
jurisdiction in which such offer, solicitation or sale would be
unlawful. Any offers of the securities were made only by means of
a confidential offering memorandum. The securities will not be
and have not been registered under the Securities Act or any
state securities laws and, unless so registered, may not be
offered or sold in the United States except to an exemption from,
or in a transaction not subject to, the registration requirements
of the Securities Act and applicable state laws.
Capped Call Transactions
On January9, 2017, in connection with the entry into the Purchase
Agreement and the pricing of the Exchangeable Notes, NIL and NII
entered into privately negotiated capped call transactions with
one or more of the Initial Purchasers and/or their respective
affiliates (the option counterparties). The capped call
transactions, in the aggregate, cover, subject to customary
anti-dilution adjustments, the same number of NIL common shares
that initially underlie the Exchangeable Notes.
The capped call transactions are expected to reduce potential
dilution to NIL common shares and/or offset potential cash
payments NII is required to make in excess of the principal
amount upon any exchange of the Exchangeable Notes. Such
reduction and/or offset is subject to a cap representing a price
per share of $31.4475, an approximately 75.0% premium over the
last reported sale price of $17.97 per common share of NIL on The
New York Stock Exchange on January 9, 2017. If the Initial
Purchasers exercise their option to
purchase additional Exchangeable Notes, NIL and NII may enter
into additional capped call transactions with the Initial
Purchasers and/or any of their affiliates.
The capped call transactions are separate transactions entered
into by NIL and NII with the option counterparties, are not
part of the terms of the Exchangeable Notes and will not change
holders rights under the Exchangeable Notes or the trustees
rights or duties under the indenture. Holders of Exchangeable
Notes will not have any rights with respect to the capped call
transactions.
The description of the capped call transactions is a summary
and is qualified in its entirety by reference to the complete
text of the capped call transaction confirmations, copies of
which are filed hereto as Exhibit10.2 and Exhibit10.3 and are
incorporated herein by reference.
Item 3.02 Unregistered Sales of Equity
Securities.
The information set forth in Item 1.01 of this Current Report
on Form8-K is incorporated herein by reference.
Item 8.01 Other Events
On January9, 2017, NIL issued a press release announcing the
commencement of the offering by NII of the Exchangeable Notes.
The press release is attached hereto as Exhibit99.1 and is
incorporated herein by reference.
On January10, 2017, NIL issued a press release announcing the
pricing by NII of the offering of the Exchangeable Notes. The
press release is attached hereto as Exhibit99.2 and is
incorporated herein by reference.
Item9.01 Financial Statements and Exhibits
(d)Exhibits.
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Exhibit No. |
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Description |
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10.1 |
Purchase Agreement, dated January9, 2017, among Nabors |
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10.2 |
Call Option Transaction Confirmation, dated as of |
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10.3 |
Call Option Transaction Confirmation, dated as of |
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99.1 |
Launch Press Release regarding the Exchangeable Notes |
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99.2 |
Pricing Press Release regarding the Exchangeable Notes |
About Nabors Industries Ltd. (NYSE:NBR)
Nabors Industries Ltd. owns and operates a land-based drilling rig fleet in North America. The Company is a provider of offshore platform work over and drilling rigs. It conducts its Drilling & Rig Services business through four segments: U.S. Drilling, Canada Drilling, International Drilling and Rig Services. Its fleet of rigs and drilling-related equipment includes approximately 430 actively marketed rigs for land-based drilling operations in the United States, Canada and over 20 other countries throughout the world, and approximately 40 actively marketed rigs for offshore drilling operations in the United States and multiple international markets. It provides drilling technology and equipment, and well-site services, including engineering, transportation and disposal, construction, maintenance, well logging, directional drilling, rig instrumentation, data collection and other support services. In addition, it manufactures and leases or sells top drives and other rig equipment. Nabors Industries Ltd. (NYSE:NBR) Recent Trading Information
Nabors Industries Ltd. (NYSE:NBR) closed its last trading session up +0.04 at 17.73 with 13,625,134 shares trading hands.
