Document:

exv4w2

Exhibit
4.2

 EXECUTION VERSION

NABORS INDUSTRIES, INC.

$400,000,000 6.15% Senior Notes due 2018

REGISTRATION RIGHTS AGREEMENT

New York, New York

July 22, 2008

CITIGROUP GLOBAL MARKETS INC.

388 Greenwich Street

New York, New York 10013

UBS SECURITIES LLC

677 Washington Blvd.

Stamford, CT 06901

Ladies and Gentlemen:

          Nabors Industries, Inc., a corporation organized under the laws of the State of Delaware (the
“Company”), proposes to issue and sell to the several initial purchasers named in Schedule A hereto
(the “Initial Purchasers”), upon the terms set forth in a purchase agreement, dated July 17, 2008
(the “Purchase Agreement”), $400,000,000 aggregate principal amount of its 6.15% Senior Notes due
2018 (the “Notes”) relating to the initial placement of the Notes (the “Initial Placement”). The
Notes will be unconditionally guaranteed (the “Guarantees” and together with the Notes, the
“Securities”) on a senior basis by Nabors Industries Ltd., a Bermuda company (the “Guarantor”). To
satisfy a condition to the obligations of the Initial Purchasers under the Purchase Agreement, the
Company and the Guarantor agree with the Initial Purchasers for the benefit of the holders from
time to time of the Securities (including the Initial Purchasers) and the New Securities (as
defined herein) (each a “Holder” and, together, the “Holders”), as follows:

          1. Definitions. Capitalized terms used herein without definition shall have their
respective meanings set forth in the Purchase Agreement. As used in this Registration Rights
Agreement (this “Agreement”), the following capitalized defined terms shall have the following
meanings:

          “Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations of the
Commission promulgated thereunder.

          “Affiliate” of any specified Person shall have the same meaning as in Rule 501(b) of
Regulation D of the Securities Act.

          “Agreement” shall have the meaning set forth in Section 1 hereof.

 

 

          “Amended Exchange Offer Registration Statement” shall mean the Original Exchange Offer
Registration Statement, as amended to provide for the Registered Exchange Offer.

          “Broker-Dealer” shall mean any broker or dealer registered as such under the Exchange Act.

          “Business Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or a day
on which banking institutions or trust companies are authorized or obligated by law to close in New
York City.

          “Closing Date” shall mean the date on which the Securities are initially issued.

          “Commission” shall mean the Securities and Exchange Commission.

          “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder.

          “Exchange Offer Registration Period” shall mean the 180-day period following the effective
date of the Exchange Offer Registration Statement or the Amended Exchange Offer Registration
Statement, exclusive of any period during which any stop order shall be in effect suspending the
effectiveness of such Exchange Offer Registration Statement or the Amended Exchange Offer
Registration Statement, or such shorter period as will terminate when all New Securities held by
Exchanging Dealers or Initial Purchasers have been sold pursuant thereto.

          “Exchange Offer Registration Statement” shall mean a registration statement of the Company and
the Guarantor on an appropriate form under the Act with respect to the Registered Exchange Offer,
all amendments and supplements to such registration statement, including post-effective amendments
thereto, in each case including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.

          “Exchanging Dealer” shall mean any Holder (which may include any of the Initial Purchasers)
that is a Broker-Dealer and elects to exchange for New Securities any Securities that it acquired
for its own account as a result of market-making activities or other trading activities (but not
directly from the Company or any Affiliate of the Company).

          “Free Writing Prospectus” shall mean each free writing prospectus (as defined in Rule 405
under the Securities Act) prepared by or on behalf of the Company (or any of its agents or
representatives) or used or referred to by the Company (or any of its agents or representatives) in
connection with the sale of the Notes or the New Notes.

          “Holder” shall have the meaning set forth in the preamble hereto.

          “Indenture” shall mean the Indenture relating to the Securities, dated as of February 20,
2008, among the Company, the Guarantor and Wells Fargo Bank, National Association, as trustee, as
the same may be amended from time to time in accordance with the terms thereof.

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          “Initial Placement” shall have the meaning set forth in the preamble hereto.

          “Initial Purchasers” shall have the meaning set forth in the preamble hereto.

          “Losses” shall have the meaning set forth in Section 7(d) hereof.

          “Majority Holders” shall mean the Holders of a majority of the aggregate principal amount of
Notes and/or New Notes, as applicable, registered under a Registration Statement.

          “Managing Underwriters” shall mean the investment banker or investment bankers and manager or
managers that shall administer an underwritten offering.

          “Memorandum” shall have the meaning set forth in the Purchase Agreement.

          “New Notes” shall mean debt securities of the Company, guaranteed by the Guarantor, identical
in all material respects to the Notes (except that the cash interest and interest rate step-up
provisions and the transfer restrictions shall be modified or eliminated, as appropriate) and to be
issued under the Indenture or the New Securities Indenture.

          “New Securities” shall mean debt securities of the Company and the related guarantees of the
Guarantor, identical in all material respects to the Securities (except that the cash interest and
interest rate step-up provisions and the transfer restrictions shall be modified or eliminated, as
appropriate) and to be issued under the Indenture or the New Securities Indenture.

          “New Securities Indenture” shall mean an indenture among the Company, the Guarantor and the
New Securities Trustee, identical in all material respects to the Indenture (except that the
interest rate step-up provisions will be modified or eliminated, as appropriate).

          “New Securities Trustee” shall mean a bank or trust company reasonably satisfactory to the
Initial Purchasers, as trustee with respect to the New Securities under the New Securities
Indenture.

          “Original Exchange Offer Registration Statement” shall mean the registration statement of the
Company and the Guarantor on Form S-4 (File No. 333-151053) under the Act with respect to the
registered exchange offer provided for in the Registration Rights Agreement dated February 20, 2008
(the “Original Registration Rights Agreement”) among the Company, the Guarantor and the initial
purchasers named therein, all amendments and supplements to such registration statement, including
post-effective amendments thereto, in each case including the Prospectus contained therein, all
exhibits thereto and all material incorporated by reference therein.

          “Prospectus” shall mean the prospectus included in any Registration Statement (including,
without limitation, a prospectus that discloses information previously omitted from a prospectus
filed as part of an effective registration statement in reliance upon Rule 430A under the Act), as
amended or supplemented by any prospectus supplement, with respect to the terms of the offering of
any portion of the Securities or the New Securities covered by such

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Registration Statement, and all amendments and supplements thereto and all material
incorporated by reference therein.

          “Purchase Agreement” shall have the meaning set forth in the preamble hereto.

          “Registered Exchange Offer” shall mean the proposed offer of the Company to issue and deliver
to the Holders of the Securities that are not prohibited by any law or policy of the Commission
from participating in such offer, in exchange for the Securities, a like aggregate principal amount
of the New Notes and Related Guarantees. The Registered Exchange Offer may be conducted as part of
the same exchange offer provided for in the Original Registration Rights Agreement.

          “Registration Statement” shall mean any Exchange Offer Registration Statement, Amended
Exchange Offer Registration Statement or Shelf Registration Statement that covers any of the
Securities or the New Securities pursuant to the provisions of this Agreement, any amendments and
supplements to such registration statement, including post-effective amendments (in each case
including the Prospectus contained therein), all exhibits thereto and all material incorporated by
reference therein.

          “Related Guarantees” shall mean the guarantees of the Guarantor to be issued under the
Indenture or the New Securities Indenture in respect of New Notes.

          “Securities” shall have the meaning set forth in the preamble hereto.

          “Shelf Registration” shall mean a registration effected pursuant to Section 3 hereof.

          “Shelf Registration Period” has the meaning set forth in Section 3(b) hereof.

          “Shelf Registration Statement” shall mean a “shelf” registration statement of the Company and
the Guarantor pursuant to the provisions of Section 3 hereof which covers some or all of the
Securities and/or New Securities, as applicable, on an appropriate form under Rule 415 under the
Act, or any similar rule that may be adopted by the Commission, amendments and supplements to such
registration statement, including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by reference therein.

          “Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended, and the rules
and regulations of the Commission promulgated thereunder and any successor act, rules and
regulations.

          “Trustee” shall mean the trustee with respect to the Securities and New Securities under the
Indenture.

          “Underwriter” shall mean any underwriter of Securities or New Securities in connection with an
offering thereof under a Registration Statement.

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          2. Registered Exchange Offer.

               (a) Except as set forth in Section 3 below, the Company and the Guarantor shall
prepare, at their cost, and, not later than 50 days following the Closing Date (or if such
50th day is not a Business Day, the next succeeding Business Day) shall file with
the Commission the Exchange Offer Registration Statement or the Amended Exchange Offer
Registration Statement with respect to the Registered Exchange Offer. The Company and the
Guarantor shall use their reasonable best efforts to cause the Exchange Offer Registration
Statement or the Amended Exchange Offer Registration Statement to become effective under the
Act not later than September 10, 2008.

               (b) Upon the effectiveness of the Exchange Offer Registration Statement or the Amended
Exchange Offer Registration Statement, the Company and the Guarantor shall promptly commence
the Registered Exchange Offer.

               (c) In connection with the Registered Exchange Offer, the Company and the Guarantor
shall:

          (i) mail to each Holder a copy of the Prospectus forming part of the Exchange
Offer Registration Statement or the Amended Exchange Offer Registration Statement,
together with an appropriate letter of transmittal and related documents;

          (ii) commence and use their reasonable best efforts to complete the Registered
Exchange Offer promptly, but no later than October 20, 2008, and hold the Registered
Exchange Offer open for not less than 20 Business Days;

          (iii) use their reasonable best efforts to keep the Exchange Offer Registration
Statement or the Amended Exchange Offer Registration Statement continuously
effective under the Act, supplemented and amended as required under the Act to
ensure that it is available for sales of New Securities by Exchanging Dealers or the
Initial Purchasers during the Exchange Offer Registration Period;

          (iv) utilize the services of a depositary for the Registered Exchange Offer,
which may be the Trustee, the New Securities Trustee or an Affiliate of either of
them;

          (v) permit Holders to withdraw tendered Securities at any time prior to the
close of business, New York time, on the last Business Day on which the Registered
Exchange Offer is open; and

          (vi) comply in all material respects with all applicable laws.

               (d) As soon as practicable after the close of the Registered Exchange Offer, the
Company and the Guarantor shall:

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          (i) accept for exchange all Notes tendered and not validly withdrawn pursuant
to the Registered Exchange Offer;

          (ii) deliver to the Trustee for cancellation in accordance with Section 5(r)
all Notes so accepted for exchange; and

          (iii) cause the Trustee or New Securities Trustee, as the case may be, promptly
to authenticate and deliver to each Holder of Securities a principal amount of New
Notes equal to the principal amount of the Notes of such Holder so accepted for
exchange.

               (e) Each Holder hereby acknowledges and agrees that any Broker-Dealer and any such
Holder using the Registered Exchange Offer to participate in a distribution of the New
Securities (x) could not under Commission policy as in effect on the date of this Agreement
rely on the position of the Commission in Morgan Stanley and Co., Inc. (pub. avail.
June 5, 1991) and Exxon Capital Holdings Corporation (pub. avail. May 13, 1988), as
interpreted in the Commission’s letter to Shearman & Sterling dated July 2, 1993 and similar
no-action letters; and (y) must comply with the registration and prospectus delivery
requirements of the Act in connection with any secondary resale transaction which must be
covered by an effective registration statement containing the selling security holder
information required by Item 507 or 508, as applicable, of Regulation S-K under the Act if
the resales are of New Securities obtained by such Holder in exchange for Securities
acquired by such Holder directly from the Company or one of its Affiliates. Accordingly,
each Holder participating in the Registered Exchange Offer shall be required to represent to
the Company and the Guarantor that, at the time of the consummation of the Registered
Exchange Offer:

          (i) any New Securities received by such Holder will be acquired in the ordinary
course of business;

          (ii) such Holder will have no arrangement or understanding with any Person to
participate in the distribution of the Securities or the New Securities within the
meaning of the Act;

          (iii) such Holder is not an Affiliate of the Company or the Guarantor or if it
is an Affiliate, such Holder will comply with the registration and prospectus
delivery requirements of the Act to the extent applicable;

          (iv) if such Holder is not a Broker-Dealer, that it is not engaged in, and does
not intend to engage in, the distribution of the New Securities; and

          (v) if such Holder is a Broker-Dealer, that it will receive New Securities for
its own account in exchange for Securities that were acquired as a result of
market-making activities or other trading activities and that it will deliver a
prospectus in connection with any resale of such New Securities.

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          3. Shelf Registration.

               (a) If (i) due to any change in law or applicable interpretations thereof by the
Commission’s staff, the Company determines upon advice of its outside counsel that it is not
permitted to effect the Registered Exchange Offer as contemplated by Section 2 hereof; (ii)
for any other reason the Exchange Offer Registration Statement or the Amended Exchange Offer
Registration Statement is not declared effective by September 10, 2008 or the Registered
Exchange Offer is not consummated by October 20, 2008; (iii) the Initial Purchasers
determine upon advice of their counsel that a Shelf Registration Statement must be filed in
connection with any public offering or sale of Securities that are not eligible to be
exchanged for New Securities in the Registered Exchange Offer and that are held by them
following consummation of the Registered Exchange Offer; or (iv) any Holder (other than the
Initial Purchasers) is not eligible to participate in the Registered Exchange Offer or does
not receive freely tradeable New Securities in the Registered Exchange Offer other than by
reason of such Holder being an Affiliate of the Company (it being understood that the
requirement that a participating Broker-Dealer deliver the prospectus contained in the
Exchange Offer Registration Statement or the Amended Exchange Offer Registration Statement
in connection with sales of New Securities shall not result in such New Securities being not
“freely tradeable”), the Company and the Guarantor shall effect a Shelf Registration
Statement in accordance with subsection (b) below.

               (b) If required pursuant to subsection (a) above,

          (i) the Company and the Guarantor, at their cost, shall as promptly as
practicable, but in no event later than 90 days after such obligation to file
arises, file with the Commission and cause to be declared effective under the Act as
soon as practicable, but in no event later than October 19, 2008, a Shelf
Registration Statement relating to the offer and sale of the Securities or the New
Securities, as applicable, by the Holders thereof from time to time in accordance
with the methods of distribution elected by such Holders and set forth in such Shelf
Registration Statement; provided, however, that no Holder (other
than the Initial Purchasers) shall be entitled to have the Securities or New
Securities held by it covered by such Shelf Registration Statement unless such
Holder agrees in writing to be bound by all of the provisions of this Agreement
applicable to such Holder; and provided further, that with respect
to New Securities received by the Initial Purchasers in exchange for Securities
constituting any portion of an unsold allotment, the Company and the Guarantor may,
if permitted by current interpretations by the Commission’s staff, file a
post-effective amendment to the Exchange Offer Registration Statement or the Amended
Exchange Offer Registration Statement containing the information required by Item
507 or 508 of Regulation S-K, as applicable, in satisfaction of their obligations
under this subsection with respect thereto, and any such Exchange Offer Registration
Statement or Amended Exchange Offer Registration Statement, as so amended, shall be
referred to herein as, and governed by the provisions herein applicable to, a Shelf
Registration Statement;

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          (ii) the Company and the Guarantor shall use their reasonable best efforts to
keep the Shelf Registration Statement continuously effective, supplemented and
amended as required by the Act, in order to permit the Prospectus forming part
thereof to be usable by Holders for a period the earlier of (A) the time when all of
the Securities or New Securities, as applicable, covered by the Shelf Registration
Statement can be sold pursuant to Rule 144 without limitation by non-affiliates of
the Company under clause (d) of Rule 144, (B) the date on which all the Securities
or New Securities, as applicable, covered by the Shelf Registration Statement have
been sold pursuant to the Shelf Registration Statement, and (C) one year from the
date the Shelf Registration Statement is declared effective by the Commission (in
any such case, such period being called the “Shelf Registration Period”); it being
understood that the Company and the Guarantor shall be deemed not to have used their
reasonable best efforts to keep the Shelf Registration Statement effective during
the requisite period if they voluntarily take any action that would result in
Holders of Securities or New Securities covered thereby not being able to offer and
sell such Securities or New Securities during that period, unless (A) such action is
required by applicable law; or (B) such action is taken by the Company and the
Guarantor in good faith and for valid business reasons (not including avoidance of
the Company’s and the Guarantor’ obligations hereunder), including, but not limited
to, the acquisition or divestiture of assets, so long as the Company and the
Guarantor promptly thereafter comply with the requirements of Section 5(k) hereof,
if applicable; and

          (iii) the Company and the Guarantor shall cause the Shelf Registration
Statement and the related Prospectus and any amendment or supplement thereto, as of
the effective date of the Shelf Registration Statement or such amendment or
supplement, (A) to comply in all material respects with the applicable requirements
of the Securities Act and the rules and regulations of the Commission; and (B) not
to contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading.

          4. Special Interest. If (a) on or prior to October 20, 2008, the Registered Exchange
Offer has not been consummated, or (b) after either the Exchange Offer Registration Statement, the
Amended Exchange Offer Registration Statement or the Shelf Registration Statement has been declared
effective, such Registration Statement thereafter ceases to be effective or usable in connection
with resales of Securities or New Securities in accordance with and during the periods specified in
this Agreement (each such event referred to in clauses (a) and (b), a “Registration Default”),
then, as liquidated damages, interest (“Special Interest”) will accrue on the principal amount of
the Securities and the New Securities (in addition to the stated interest on the Securities and New
Securities) from and including the date on which any such Registration Default shall occur to but
excluding the date on which all Registration Defaults have been cured. Special Interest will
accrue at a rate of 0.25% per annum.

          All obligations of the Company and the Guarantor set forth in the preceding paragraph that are
outstanding with respect to any Security at the time such Security is

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exchanged for a New Security shall survive until such time as all such obligations with
respect to such Security have been satisfied in full.

          5. Additional Registration Procedures. In connection with any Shelf Registration
Statement and, to the extent applicable, any Exchange Offer Registration Statement or the Amended
Exchange Offer Registration Statement, the following provisions shall apply.

               (a) The Company and the Guarantor shall:

          (i) furnish to the Initial Purchasers, not less than five Business Days prior
to the filing thereof with the Commission, a draft copy of any Exchange Offer
Registration Statement, the Amended Exchange Offer Registration Statement and any
Shelf Registration Statement, and each amendment thereof and each amendment or
supplement, if any, to the Prospectus included therein (including all documents
incorporated by reference therein after the initial filing) and shall use their
reasonable best efforts to reflect in each such document, when so filed with the
Commission, such comments as the Initial Purchasers reasonably propose;

          (ii) include the information to the effect of that set forth in:

          (A) Annex A and Annex B hereto in the forepart of the Prospectus
contained in the Exchange Offer Registration Statement or the Amended
Exchange Offer Registration Statement

          (B) Annex C hereto in the underwriting or plan of distribution section
of the Prospectus contained in the Exchange Offer Registration Statement or
the Amended Exchange Offer Registration Statement, and

          (C) Annex D hereto in the letter of transmittal delivered pursuant to
the Registered Exchange Offer;

          (iii) if requested by the Initial Purchasers, include the information required
by Item 507 or 508 of Regulation S-K, as applicable, in the Prospectus contained in
the Exchange Offer Registration Statement or the Amended Exchange Offer Registration
Statement; and

          (iv) in the case of a Shelf Registration Statement, include the names of the
Holders that propose to sell Securities or New Securities, as applicable, pursuant
to the Shelf Registration Statement as selling security holders.

                (b) The Company and the Guarantor shall ensure that:

          (i) any Registration Statement and any amendment thereto and any Prospectus
forming part thereof and any amendment or supplement thereto complies in all
respects with the Act and the rules and regulations thereunder; and

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          (ii) any Registration Statement and any amendment thereto does not, when it
becomes effective (within the meaning of Rule 430B under the Securities Act),
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading.

          (c) The Company and the Guarantor shall advise the Initial Purchasers, the Holders of
Securities or New Securities covered by any Shelf Registration Statement and any Exchanging
Dealer under any Exchange Offer Registration Statement or the Amended Exchange Offer
Registration Statement that has provided in writing to the Company and the Guarantor a
telephone or facsimile number and address for notices, and, if requested by the Initial
Purchasers or any such Holder or Exchanging Dealer shall confirm such advice in writing
(which notice pursuant to clauses (ii)-(v) hereof shall be accompanied by an instruction to
suspend the use of the Prospectus until the Company and the Guarantor shall have remedied
the basis for such suspension):

          (i) when a Registration Statement and any amendment thereto has been filed with
the Commission and when the Registration Statement or any post-effective amendment
thereto has become effective;

          (ii) of any request by the Commission for any amendment or supplement to the
Registration Statement or the Prospectus or for additional information;

          (iii) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings for
that purpose;

          (iv) of the receipt by the Company and the Guarantor of any notification with
respect to the suspension of the qualification of the Securities or New Securities
included therein for sale in any jurisdiction or the initiation of any proceeding
for such purpose; and

          (v) of the happening of any event that requires any change in the Registration
Statement or the Prospectus so that, as of such date, the statements therein are not
misleading and do not omit to state a material fact required to be stated therein or
necessary to make the statements therein (in the case of the Prospectus, in the
light of the circumstances under which they were made) not misleading.

          (d) The Company and the Guarantor shall use their reasonable best efforts to obtain the
withdrawal of any order suspending the effectiveness of any Registration Statement or the
qualification of the Securities or New Securities therein for sale in any jurisdiction at
the earliest possible time.

          (e) The Company and the Guarantor shall furnish to each Holder of Securities or New
Securities covered by any Shelf Registration Statement, without charge, at least one copy of
such Shelf Registration Statement and any post-effective

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amendment thereto, and, if the Holder so requests in writing, all material incorporated
therein by reference and all exhibits thereto (including exhibits incorporated by reference
therein).

          (f) The Company and the Guarantor shall, during the Shelf Registration Period, deliver
to each Holder of Securities or New Securities covered by any Shelf Registration Statement,
without charge, as many copies of the Prospectus (including each preliminary Prospectus)
included in such Shelf Registration Statement and any amendment or supplement thereto as
such Holder may reasonably request. The Company and the Guarantor consent to the use of the
Prospectus or any amendment or supplement thereto by each of the selling Holders of
Securities or New Securities in connection with the offering and sale of the Securities or
New Securities covered by the Prospectus, or any amendment or supplement thereto, included
in the Shelf Registration Statement.

          (g) The Company and the Guarantor shall furnish to each Exchanging Dealer or the
Initial Purchasers which so requests, without charge, at least one copy of the Exchange
Offer Registration Statement or the Amended Exchange Offer Registration Statement and any
post-effective amendment thereto, including all material incorporated by reference therein,
and, if the Exchanging Dealer so requests in writing, all exhibits thereto (including
exhibits incorporated by reference therein).

          (h) The Company and the Guarantor shall promptly deliver to the Initial Purchasers,
each Exchanging Dealer and each other Person required to deliver a Prospectus during the
Exchange Offer Registration Period, without charge, as many copies of the Prospectus
included in such Exchange Offer Registration Statement or the Amended Exchange Offer
Registration Statement and any amendment or supplement thereto as any such Person may
reasonably request. The Company and the Guarantor consent to the use of the Prospectus or
any amendment or supplement thereto by the Initial Purchasers, any Exchanging Dealer and any
such other Person that may be required to deliver a Prospectus following the Registered
Exchange Offer in connection with the offering and sale of the New Securities covered by the
Prospectus, or any amendment or supplement thereto, included in the Exchange Offer
Registration Statement or the Amended Exchange Offer Registration Statement.

          (i) Prior to the Registered Exchange Offer or any other offering of Securities or New
Securities pursuant to any Registration Statement, the Company and the Guarantor shall
arrange, if necessary, for the qualification of the Securities or the New Securities for
sale under the laws of such jurisdictions as any Holder shall reasonably request and will
maintain such qualification in effect so long as required; provided that in no event shall
the Company and the Guarantor be obligated to qualify to do business in any jurisdiction
where they are not then so qualified or to take any action that would subject them to
service of process in suits or taxation, other than those arising out of the Initial
Placement, the Registered Exchange Offer or any offering pursuant to a Shelf Registration
Statement, in any such jurisdiction where they are not then so subject.

          (j) The Company and the Guarantor shall cooperate with the Holders of Securities and
New Securities to facilitate the timely preparation and delivery of

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certificates representing New Securities or Securities to be issued or sold pursuant to
any Registration Statement free of any restrictive legends and in such denominations and
registered in such names as Holders may request.

          (k) Upon the occurrence of any event contemplated by subsections (c)(ii) through (v)
above, the Company and the Guarantor shall promptly prepare a post-effective amendment to
the applicable Registration Statement or an amendment or supplement to the related
Prospectus or file any other required document so that, as thereafter delivered to the
Initial Purchasers or Exchanging Dealers, the Prospectus will not include an untrue
statement of a material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were made, not
misleading. In such circumstances, the period of effectiveness of the Exchange Offer
Registration Statement or the Amended Exchange Offer Registration Statement provided for in
Section 2 and the Shelf Registration Statement provided for in Section 3(b) shall each be
extended by the number of days from and including the date of the giving of a notice of
suspension pursuant to Section 5(c) to and including the date when the Initial Purchasers,
the Holders of the Securities or New Securities and any known Exchanging Dealer shall have
received such amended or supplemented Prospectus pursuant to this Section.

          (l) Not later than the effective date of any Registration Statement, the Company and
the Guarantor shall provide a CUSIP number for the Securities or the New Securities, as the
case may be, registered under such Registration Statement and provide the Trustee with
printed certificates for such Securities or New Securities, in a form eligible for deposit
with The Depository Trust Company.

          (m) The Company and the Guarantor shall comply with all applicable rules and
regulations of the Commission and shall make generally available to their security holders
as soon as practicable after the effective date of the applicable Registration Statement an
earnings statement satisfying the provisions of Section 11(a) of the Act.

          (n) The Company and the Guarantor shall cause the Indenture or the New Securities
Indenture, as the case may be, to be qualified under the Trust Indenture Act in a timely
manner.

          (o) The Company and the Guarantor may require each Holder of Securities or New
Securities to be sold pursuant to any Shelf Registration Statement to furnish to the Company
and the Guarantor such information regarding the Holder and the distribution of such
Securities as the Company and the Guarantor may from time to time reasonably require for
inclusion in such Registration Statement. The Company and the Guarantor may exclude from
such Shelf Registration Statement the Securities or New Securities of any Holder that fails
to furnish such information within a reasonable time after receiving such request.

          (p) In the case of any Shelf Registration Statement, the Company and the Guarantor
shall enter into such agreements and take all other appropriate actions (including if
requested an underwriting agreement in customary form) in order to

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expedite or facilitate the registration or the disposition of the Securities or New
Securities, and in connection therewith, if an underwriting agreement is entered into, cause
the same to contain indemnification provisions and procedures no less favorable than those
set forth in Section 7 (or such other provisions and procedures acceptable to the Majority
Holders and the Managing Underwriters, if any, with respect to all parties to be indemnified
pursuant to Section 7).

          (q) In the case of any Shelf Registration Statement, the Company and the Guarantor
shall use their reasonable best efforts to:

          (i) make reasonably available for inspection by the Holders of Securities or
New Securities to be registered thereunder, any Underwriter participating in any
disposition pursuant to such Registration Statement, and any attorney, accountant or
other agent retained by the Holders or any such Underwriter all relevant financial
and other records, pertinent corporate documents and properties of the Company and
its subsidiaries;

          (ii) cause the Company’s officers, directors and employees to supply all
relevant information reasonably requested by the Holders or any such Underwriter,
attorney, accountant or agent in connection with any such Registration Statement as
is customary for similar due diligence examinations; provided,
however, that any information that is designated in writing by the Company,
in good faith, as confidential at the time of delivery of such information shall be
kept confidential by the Holders or any such Underwriter, attorney, accountant or
agent, unless such disclosure is made in connection with a court proceeding or
required by law, or such information becomes available to the public generally or
through a third party without an accompanying obligation of confidentiality;

          (iii) make such representations and warranties to the Holders of Securities or
New Securities registered thereunder and the Underwriters, if any, in form,
substance and scope as are customarily made by issuers to Underwriters in primary
underwritten offerings and covering matters including, but not limited to, those set
forth in the Purchase Agreement;

          (iv) obtain opinions of counsel to the Company and the Guarantor and updates
thereof (which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the Managing Underwriters, if any) addressed to each
selling Holder and the Underwriters, if any, covering such matters as are
customarily covered in opinions requested in underwritten offerings and such other
matters as may be reasonably requested by such Holders and Underwriters;

          (v) obtain “cold comfort” letters and updates thereof from the independent
certified public accountants of the Company (and, if necessary, any other
independent certified public accountants of any subsidiary of the Company or of any
business acquired by the Company for which financial statements and

13

 

financial data are, or are required to be, included in the Registration
Statement), addressed to each selling Holder of Securities or New Securities
registered thereunder and the Underwriters, if any, in customary form and covering
matters of the type customarily covered in “cold comfort” letters in connection with
primary underwritten offerings; and

          (vi) deliver such documents and certificates as may be reasonably requested by
the Majority Holders and the Managing Underwriters, if any, including those to
evidence compliance with Section 5(k) and with any customary conditions contained in
the underwriting agreement or other agreement entered into by the Company and the
Guarantor.

The actions set forth in clauses (iii), (iv), (v) and (vi) of this Section shall be performed at
(A) the effectiveness of such Registration Statement and each post-effective amendment thereto; and
(B) each closing under any underwriting or similar agreement as and to the extent required
thereunder.

          (r) If a Registered Exchange Offer is to be consummated, upon delivery of the
Securities by Holders to the Company (or to such other Person as directed by the Company) in
exchange for the New Securities, the Company shall mark, or caused to be marked, on the
Securities so exchanged that such Securities are being canceled in exchange for the New
Securities. In no event shall the Securities be marked as paid or otherwise satisfied.

          (s) If any Broker-Dealer shall underwrite any Securities or New Securities or
participate as a member of an underwriting syndicate or selling group or “assist in the
distribution” (within the meaning of the Rules of Fair Practice and the By-Laws of the
Financial Industry Regulatory Authority, Inc.) thereof, whether as a Holder of such
Securities or New Securities or as an Underwriter, a placement or sales agent or a broker or
dealer in respect thereof, or otherwise, will assist such Broker-Dealer in complying with
the requirements of such Rules and By-Laws, including, without limitation, by:

          (i) if such Rules or By-Laws shall so require, engaging a “qualified
independent underwriter” (as defined in such Rules) to participate in the
preparation of the Registration Statement, to exercise usual standards of due
diligence with respect thereto and, if any portion of the offering contemplated by
such Registration Statement is an underwritten offering or is made through a
placement or sales agent, to recommend the yield of such Securities or New
Securities;

          (ii) indemnifying any such qualified independent underwriter to the extent of
the indemnification of Underwriters provided in Section 7 hereof; and

          (iii) providing such information to such Broker-Dealer as may be required in
order for such Broker-Dealer to comply with the requirements of such Rules.

14

 

          (t) The Company and the Guarantor shall use their reasonable best efforts to take all
other steps necessary to effect the registration of the Securities or the New Securities, as
the case may be, covered by a Registration Statement.

     6. Registration Expenses. The Company and the Guarantor shall bear all expenses
incurred in connection with the performance of their obligations under Sections 2, 3 and 5 hereof
and, in the event of any Shelf Registration Statement, will reimburse the Holders for the
reasonable fees and disbursements of one firm or counsel designated by the Majority Holders to act
as counsel for the Holders in connection therewith, but excluding fees and expenses of counsel to
the Initial Purchasers or the Holders, all agency fees and commissions, underwriting discounts and
commissions and transfer taxes attributable to the sale or disposition of Securities by a Holder.

     7. Indemnification and Contribution.

          (a) The Company and the Guarantor agree, jointly and severally, to indemnify and hold
harmless (i) the Initial Purchasers, (ii) each Holder of Securities or New Securities, as
the case may be, covered by any Registration Statement (including with respect to any
Prospectus delivery as contemplated in Section 5(h) hereof, each Exchanging Dealer), (iii)
each Person, if any, who controls (within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act) any of the foregoing (any of the Persons referred to
in this clause (iii) being hereinafter referred to as a “controlling person”), and (iv) the
respective officers, directors, partners, employees, representatives and agents of the
Initial Purchasers, the Holders (including predecessor Holders) or any controlling person
(any person referred to in clause (i), (ii), (iii) or (iv) may hereinafter be referred to as
an “Indemnified Holder”), from and against any and all losses, claims, damages, and
liabilities (including, without limitation, reasonable legal fees and other expenses
incurred in connection with any suit, action or proceeding or any claim asserted)
(collectively “Losses”) caused by any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement, preliminary Prospectus, Prospectus,
Free Writing Prospectus or any “issuer information” (as defined in Rule 433 of the
Securities Act) filed or required to be filed pursuant to Rule 433(d) under the Securities
Act, or any amendment or supplement thereto, or caused by any omission or alleged omission
to state therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with information relating to any
Indemnified Holder furnished to the Company or the Guarantor in writing by such Indemnified
Holder expressly for use therein; the Company or the Guarantor shall notify such Indemnified
Holder promptly of the institution, threat or assertion of any claim, proceeding (including
any governmental investigation) or litigation in connection with the matters addressed by
this Agreement which involves the Company or the Guarantor or such Indemnified Holder.

          (b) Each Holder agrees, severally and not jointly, to indemnify and hold harmless the
Company and the Guarantor, each of their respective directors and officers and each Person
who controls the Company or the Guarantor within the meaning

15

 

of either Section 15 of the Securities Act or Section 20 of the Exchange Act to the
same extent as the foregoing indemnity from the Company and the Guarantor to each Holder,
but only with reference to such losses, claims, damages or liabilities which are caused by
any untrue statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with information relating to a Holder furnished to the Company or the
Guarantor in writing by such Holder expressly for use in any Registration Statement,
preliminary Prospectus or Prospectus, or any amendment or supplement thereto. This indemnity
agreement will be in addition to any liability which any such Holder may otherwise have.

          (c) Each of the Initial Purchasers, severally and not jointly, agrees to indemnify and
hold harmless the Company and the Guarantor, each of their respective directors and officers
and each Person who controls the Company or the Guarantor within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company and the Guarantor to the Initial Purchasers, but only
with reference to such losses, claims, damages or liabilities which are caused by any untrue
statement or omission or alleged untrue statement or omission made in reliance upon and in
conformity with information relating to the Initial Purchasers furnished to the Company or
the Guarantor in writing by the Initial Purchasers expressly for use in any Registration
Statement, preliminary Prospectus or Prospectus, or any amendment or supplement thereto.
This indemnity agreement will be in addition to any liability which the Initial Purchasers
may otherwise have.

          (d) If any suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any Person in respect
of which indemnity may be sought pursuant to either of the three preceding paragraphs, such
Person (the “Indemnified Person”) shall promptly notify the Person or Persons against whom
such indemnity may be sought (each an “Indemnifying Person”) in writing, and such
Indemnifying Person, upon request of the Indemnified Person, shall retain counsel reasonably
satisfactory to the Indemnified Person to represent the Indemnified Person and any others
entitled to indemnification pursuant to this Section 7 that the Indemnifying Person may
designate in such proceeding and shall pay the fees and expenses of such counsel related to
such proceeding. In any such proceeding, the Indemnifying Person shall be able to
participate in such proceeding and, to the extent that it so elects, jointly with any other
similarly situated Indemnifying Person, to assume the defense thereof, subject to the right
of the Indemnified Person to be separately represented and to direct its own defense if the
named parties to any such proceeding include both the Indemnified Person and the
Indemnifying Person and the Indemnified Person has been advised by counsel that
representation of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. In any such proceeding, any Indemnified Person
shall have the right to retain its own counsel, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Person unless (i) such Indemnifying Person and
the Indemnified Person shall have mutually agreed to the contrary or (ii) the named parties
in any such proceeding (including any impleaded parties) include an Indemnifying Person and
an Indemnified Person and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It is understood
that an

16

 

Indemnifying Person shall not, in connection with any proceeding or related proceedings
in the same jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all such fees and
expenses shall be reimbursed as they are incurred. Any such separate firm for the
Indemnified Holders shall be designated in writing by the Holders of the majority in amount
of Securities and New Securities offered in the Prospectus to which the claim relates, any
such separate firm for the Company, its directors, respective officers and such control
Persons of the Company shall be designated in writing by the Company, and any such separate
firm for the Guarantor, its directors, respective officers and such control Persons of the
Guarantor shall be designated in writing by the Guarantor. The Indemnifying Person shall not
be liable for any settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, such
Indemnifying Person agrees to indemnify any Indemnified Person from and against any loss or
liability by reason of such settlement or judgment. No Indemnifying Person shall, without
the prior written consent of the Indemnified Person, effect any settlement of any pending or
threatened proceeding in respect of which any Indemnified Person is or could have been a
party and indemnity could have been sought hereunder by such Indemnified Person, unless such
settlement includes an unconditional release of such Indemnified Person from all liability
on claims that are the subject matter of such proceeding.

          (e) If the indemnification provided for in the first, second and third paragraphs of
this Section 7 is unavailable to an Indemnified Person or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each Indemnifying Person
under such paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall
contribute to the amount paid or payable by such Indemnified Person as a result of such
losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect
the relative benefits received by the Indemnifying Person on the one hand and the
Indemnified Person on the other hand pursuant to the Purchase Agreement or from the offering
of the Securities or New Securities pursuant to any Registration Statement which resulted in
such losses, claims, damages or liabilities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the relative fault
of the Indemnifying Person on the one hand and the Indemnified Person on the other in
connection with the statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Guarantor on the one hand and any Indemnified Holder on the
other shall be deemed to be in the same proportion as the total net proceeds from the
Initial Placement received by the Company and the Guarantor bear to the total net proceeds
received by such Indemnified Holder from sales of Securities or New Securities giving rise
to such obligations. The relative fault of the parties shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information supplied by the
Company or the Guarantor or such Indemnified Holder and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such statement or
omission.

17

 

          (f) Each of the Company, the Guarantor and the Initial Purchasers agree that it would
not be just and equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an Indemnified Person as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses incurred by such
Indemnified Person in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, in no event shall any Holder of any
Securities or New Securities be required to contribute any amount in excess of the amount by
which the net proceeds received by such Holder from the sale of the Security or New Security
pursuant to a Registration Statement exceeds the amount of damages which such Holder would
have otherwise been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any
Person who was not guilty of such fraudulent misrepresentation.

          (g) The remedies provided for in this Section 7 are not exclusive and shall not limit
any rights or remedies that may otherwise be available to any indemnified party at law or in
equity.

          (h) The indemnity and contribution agreements contained in this Section 7 shall remain
operative and in full force and effect regardless of (i) any termination of this Agreement,
(ii) any investigation made by or on behalf of any Holder or any Person controlling any
Holder or by or on behalf of the Company or the Guarantor, their respective officers or
directors or any other Person controlling any of the Company or the Guarantor and (iii)
acceptance of and payment for any of the Securities or New Securities.

          8. Underwritten Registrations.

          (a) If any of the Securities or New Securities, as the case may be, covered by any
Shelf Registration Statement are to be sold in an underwritten offering, the Managing
Underwriters shall be selected by the Majority Holders (except as otherwise provided in
Section 8(a) of the Original Registration Rights Agreement) and shall be reasonably
satisfactory to the Company and the Guarantor.

          (b) No Person may participate in any underwritten offering pursuant to any Shelf
Registration Statement, unless such Person (i) agrees to sell such Person’s Securities or
New Securities, as the case may be, on the basis reasonably provided in any underwriting
arrangements approved by the Persons entitled hereunder to approve such arrangements; and
(ii) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms of such
underwriting arrangements.

18

 

     9. No Inconsistent Agreements. The Company has not, as of the date hereof, entered
into, nor shall it, on or after the date hereof, enter into, any agreement with respect to its
securities that is inconsistent with the rights granted to the Holders herein or otherwise
conflicts with the provisions hereof.

     10. Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, qualified, modified or supplemented, and waivers
or consents to departures from the provisions hereof may not be given, unless the Company has
obtained the written consent of the Majority Holders (or, after the consummation of any Registered
Exchange Offer in accordance with Section 2 hereof, of New Securities); provided,
however, that, with respect to any matter that directly or indirectly affects the rights of
the Initial Purchasers hereunder, the Company shall obtain the written consent of the Initial
Purchasers. Notwithstanding the foregoing (except the foregoing proviso), a waiver or consent to
departure from the provisions hereof with respect to a matter that relates exclusively to the
rights of Holders whose Securities or New Securities, as the case may be, are being sold pursuant
to a Registration Statement and that does not directly or indirectly affect the rights of other
Holders may be given by the Majority Holders, determined on the basis of Securities or New
Securities, as the case may be, being sold rather than registered under such Registration
Statement.

     11. Notices. All notices and other communications (including without limitation any
notices or other communications to the Trustee) provided for or permitted hereunder shall be made
in writing by hand-delivery, registered first-class mail, next-day air courier or facsimile:

          (1) if to a Holder, at the most current address of such Holder set forth on the records
of the registrar under the Indenture and the stock ledger of the Guarantor;

	 	 	 
	(2)

	 	if to the Initial Purchasers:
	 
	 	 
	 

	 	Citigroup Global Markets Inc.
	 

	 	388 Greenwich Street
	 

	 	New York, New York 10013
	 

	 	Attention: General Counsel
	 
	 	 
	 

	 	UBS Securities LLC
	 

	 	677 Washington Blvd.
	 

	 	Stamford, CT 06901
	 

	 	Attention: Fixed Income Syndicate

with copies to:

	 	 	 
	 

	 	Vinson & Elkins L.L.P.
	 

	 	First City Tower
	 

	 	1001 Fannin Street, Suite 2500
	 

	 	Houston, Texas 77002-6760
	 

	 	Attention: Mark Kelly

19

 

	 	 	 
	 

	 	Facsimile No.: 713-615-5531
	 
	 	 
	(3)

	 	if to the Company, at the addresses as follows:
	 
	 	 
	 

	 	Nabors Industries, Inc.
	 

	 	c/o Nabors Corporate Services, Inc.
	 

	 	515 West Greens Road, Suite 1200
	 

	 	Houston, Texas 77067
	 

	 	Attention: General Counsel
	 

	 	Facsimile No.: 281-775-8431

with copies to:

	 	 	 
	 

	 	Milbank, Tweed, Hadley & McCloy LLP
	 

	 	1 Chase Manhattan Plaza
	 

	 	New York, NY 10005
	 

	 	Attention: Arnold B. Peinado III
	 

	 	Facsimile No. (212) 822-5546
	 
	 	 
	(4)

	 	if to the Guarantor:
	 
	 	 
	 

	 	Nabors Industries Ltd.
	 

	 	Mintflower Place
	 

	 	8 Par-La-Ville Road
	 

	 	Hamilton, HM08, Bermuda

     All such notices and communications shall be deemed to have been duly given: when delivered by
hand, if personally delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; one Business Day after being timely delivered to a next-day air courier; and
when the addressor receives facsimile confirmation, if sent by facsimile.

     The Initial Purchasers or the Company or the Guarantor by notice to the other parties may
designate additional or different addresses for subsequent notices or communications.

     12. Successors. This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties, including, without the need for an express
assignment or any consent by the Company or the Guarantor thereto, subsequent Holders of Securities
or New Securities. The Company and the Guarantor hereby agree to extend the benefits of this
Agreement to any Holder of Securities and the New Securities, and any such Holder may specifically
enforce the provisions of this Agreement as if an original party hereto.

     13. Counterparts. This Agreement may be executed (including by facsimile) in any
number of counterparts and by the parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall constitute one and
the same agreement.

20

 

     14. Headings. The headings used herein are for convenience only and shall not affect
the construction hereof.

     15. Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WHOLLY WITHIN
THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

     16. Severability. If any one of more of the provisions contained herein, or the
application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect
for any reason, the validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in any way impaired or affected
thereby, it being intended that all of the rights and privileges of the parties shall be
enforceable to the fullest extent permitted by law.

     17. Securities Held by the Company, etc. Whenever the consent or approval of Holders
of a specified percentage of principal amount of Securities or New Securities is required
hereunder, Securities or New Securities, as applicable, held by the Company or its Affiliates
(other than subsequent Holders of Securities or New Securities if such subsequent Holders are
deemed to be Affiliates solely by reason of their holdings of such Securities or New Securities)
shall not be counted in determining whether such consent or approval was given by the Holders of
such required percentage.

     18. No Fiduciary Duty. The Company and Guarantor hereby acknowledge that (a) the
Initial Purchasers are acting as principal and not as an agent or fiduciary of the Company or the
Guarantor and (b) the Company’s engagement of the Initial Purchasers in connection with the
offering and the process leading up to the offering pursuant to the Purchase Agreement is as
independent contractors and not in any other capacity. Furthermore, the Company and the Guarantor
agree that they are solely responsible for making their own judgments in connection with the
offering, the Registered Exchange Offer or a Shelf Registration (irrespective of whether any of the
Initial Purchasers has advised or is currently advising the Company or the Guarantor on related or
other matters). The Company and the Guarantor agree that they will not claim that the Initial
Purchasers have rendered advisory services of any nature or respect, or owe an agency, fiduciary or
similar duty to the Company or the Guarantor, in connection with such transaction or the process
leading thereto

[Remainder Of This Page Is Intentionally Left Blank]

21

 

     If the foregoing is in accordance with your understanding of our agreement, please sign and
return to us the enclosed duplicate hereof, whereupon this Agreement and your acceptance shall
represent a binding agreement among the Company, the Guarantor and you.

	 	 	 	 	 
	 	Very truly yours,

NABORS INDUSTRIES, INC.

 	 
	 	By:  	
/s/ Bruce P. Koch	 
	 	 	Name:  	Bruce P. Koch 	 
	 	 	Title:  	Vice President and Chief
Financial Officer 	 
	 

	 	 	 	 	 
	 	NABORS INDUSTRIES LTD.

 	 
	 	By:  	
/s/ Bruce P. Koch	 
	 	 	Name:  	Bruce P. Koch 	 
	 	 	Title:  	Vice President and Chief
Financial Officer 	 
	 

	 	 	 	 	 
	The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
	 
	 	 	 	 
	CITIGROUP GLOBAL MARKETS INC.	 	 
	 
	 	 	 	 
	By:
	 	/s/ Brian D. Bednarski	 	 
	Name:

	 	 
Brian D. Bednarski
	 	 
	Title:
	 	Managing Director	 	 
	 
	 	 	 	 
	UBS SECURITIES LLC	 	 
	 
	 	 	 	 
	By:
	 	/s/ Scott Whitney	 	 
	Name:

	 	 
Scott Whitney
	 	 
	Title:
	 	Managing Director	 	 
	 
	 	 	 	 
	By:
	 	/s/ Ryan Donovan	 	 
	Name:

	 	 
Ryan Donovan
	 	 
	Title:
	 	Executive Director	 	 

Signature Page to Registration Rights Agreement

22

 

SCHEDULE A

          Initial Purchasers          

Citigroup Global Markets Inc.

UBS Securities LLC

23

 

ANNEX A

          Each broker or dealer that receives new notes for its own account in exchange for old notes
that were acquired as a result of market-making or other trading activities must acknowledge that
it will comply with the registration and prospectus delivery requirements of the Securities Act in
connection with any offer, resale, or other transfer of the new notes issued in the exchange offer,
including information with respect to any selling holder required by the Securities Act in
connection with any resale of the new notes.

           Furthermore, any broker-dealer that acquired any of its old notes directly from us:

	 	•	 	may not rely on the applicable interpretation of the staff of the SEC’s position
contained in Exxon Capital Holdings Corporation (pub. avail. May 13, 1988), Morgan
Stanley and Co., Inc. (pub. avail. June 5, 1991), as interpreted in the
Commission’s letter to Shearman & Sterling dated July 2, 1993 and similar no-action
letters; and
	 
	 	•	 	must also be named as a selling noteholder in connection with the registration
and prospectus delivery requirements of the Securities Act relating to any resale
transaction. See “Plan of Distribution” and “The Exchange Offer —Purpose and Effect
of Exchange Offer Registration Rights.”

24

 

ANNEX B

          Each broker-dealer that receives new notes for its own account in exchange for old notes,
where such old notes were acquired by such broker-dealer as a result of market-making activities or
other trading activities, must acknowledge that it will comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any offer, resale or other transfer
of such new notes, including information with respect to any selling holder required by the
Securities Act in connection with the resale of the new notes. We have agreed that for a period of
180 days after the effective date of the registration statement of which this prospectus is a part,
we will make this prospectus available to any broker-dealer for use in connection with any such
resale. See “Plan of Distribution.”

25

 

ANNEX C

PLAN OF DISTRIBUTION

          Each Broker-Dealer that receives New Securities for its own account pursuant to the Exchange
Offer must acknowledge that it will deliver a prospectus in connection with any resale of such New
Securities. This Prospectus, as it may be amended or supplemented from time to time, may be used
by a Broker-Dealer in connection with resales of New Securities received in exchange for Securities
where such Securities were acquired as a result of market-making activities or other trading
activities. We have agreed that, starting on the effective date of the registration statement of
which this Prospectus is a part and ending on the close of business 180-days after such date or
such shorter period as will terminate when all New Securities held by Exchanging Dealers or Initial
Purchasers have been sold pursuant hereto, we will make this Prospectus, as amended or
supplemented, available to any Broker-Dealer for use in connection with any such resale. In
addition, until ___, 200___, all dealers effecting transactions in the New Securities may be
required to deliver a prospectus.

          We will not receive any proceeds from any sale of New Securities by brokers-dealers. New
Securities received by Broker-Dealers for their own account pursuant to the Exchange Offer may be
sold from time to time in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the New Securities or a combination of such methods
of resale, at market prices prevailing at the time of resale, at prices related to such prevailing
market prices or negotiated prices. Any such resale may be made directly to purchasers or to or
through brokers or dealers who may receive compensation in the form of commissions or concessions
from any such Broker-Dealer and/or the purchasers of any such New Securities. Any Broker-Dealer
that resells New Securities that were received by it for its own account pursuant to the Exchange
Offer and any broker or dealer that participates in a distribution of such New Securities may be
deemed to be an “underwriter” within the meaning of the Securities Act and any profit of any such
resale of New Securities and any commissions or concessions received by any such Persons may be
deemed to be underwriting compensation under the Securities Act. The Letter of Transmittal states
that by acknowledging that it will deliver and by delivering a prospectus, a Broker-Dealer will not
be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.

           Furthermore, any broker-dealer that acquired any of the old notes directly from us:

	 	•	 	may not rely on the applicable interpretation of the staff of the SEC’s position
contained in Exxon Capital Holdings Corporation (pub. avail. May 13, 1988),
Morgan Stanley and Co., Inc. (pub. avail. June 5, 1991), ), as interpreted
in the Commission’s letter to Shearman & Sterling dated July 2, 1993 and similar
no-action letters; and
	 
	 	•	 	must also be named as a selling noteholder in connection with the registration
and prospectus delivery requirements of the Securities Act relating to any resale
transaction.

26

 

          For a period of 180-days after the effective date of the registration statement of which this
Prospectus is a part or such shorter period as will terminate when all New Securities held by
Exchanging Dealers or Initial Purchasers have been sold pursuant hereto, we will promptly send
additional copies of this Prospectus and any amendment or supplement to this Prospectus to any
Broker-Dealer that requests such documents in the Letter of Transmittal. We have agreed to pay all
expenses incident to the Exchange Offer (including the expenses of one counsel for the holder of
the Securities) other than commissions or concessions of any brokers or dealers and will indemnify
the holders of the Securities (including any Broker-Dealers) against certain liabilities, including
liabilities under the Securities Act.

          [If applicable, add information required by Regulation S-K Items 507 and/or 508.]

27

 

ANNEX D

CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS
OR SUPPLEMENTS THERETO.

	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Address:
	 	 

	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 

If the undersigned is not a Broker-Dealer, the undersigned represents that it acquired the New
Securities in the ordinary course of its business, it is not engaged in, and does not intend to
engage in, a distribution of New Securities and it has no arrangements or understandings with any
Person to participate in a distribution of the New Securities. If the undersigned is a
Broker-Dealer that will receive New Securities for its own account in exchange for Securities, it
represents that the Securities to be exchanged for New Securities were acquired by it as a result
of market-making activities or other trading activities and acknowledges that it will deliver a
prospectus in connection with any resale of such New Securities; however, by so acknowledging and
by delivering a prospectus, the undersigned will not be deemed to admit that it is an “underwriter”
within the meaning of the Securities Act.

28exv10w1

Exhibit 10.1

EXECUTION COPY

ADDENDUM TO EMPLOYMENT AGREEMENT

     This ADDENDUM TO EMPLOYMENT AGREEMENT (this “Addendum”), dated as of July 23, 2008, is by and
among Philadelphia Consolidated Holding Corp., a Pennsylvania corporation (the “Company”), Maguire
Insurance Agency, Inc., a Pennsylvania Corporation (the “Employer”), Tokio Marine Holdings, Inc. a
Japanese corporation (“Parent”), and James J. Maguire (Employee”).

     WHEREAS, Employee has served the Company and its subsidiaries pursuant to an Amended and
Restated Employment Agreement dated as of January 1, 2004 (as it exists on the date of this
Addendum, the “Unamended Employment Agreement”);

     WHEREAS, the Company has entered into an Agreement and Plan of Merger, dated as of the date of
this Addendum (the “Merger Agreement”), with Parent and Merger Sub (as defined in the Merger
Agreement) whereby, at the “Effective Time” (as defined in the Merger Agreement) (i) Merger Sub
will be merged with and into the Company (the “Merger”), (ii) the separate corporate existence of
Merger Sub will thereupon cease, and the Company will be the surviving corporation in the Merger,
and (iii) the Company and the Employer will become direct or indirect wholly owned subsidiaries of
Parent;

     WHEREAS, Employee is an integral part of the management of the Employer, and is a key
participant in the decision-making process relative to short-term and long-term planning and policy
of the Employer and the Company, and the parties hereto believe that it is critical to the
continued success of the Company, and to the ultimate success of the Merger, that Employee continue
to be employed by the Employer after the Merger; and

     WHEREAS, the parties agree that is in their best interests to enter into this Addendum, with
effect as described in Section 1 of this Addendum, on the terms set forth in this Addendum.

     NOW, THEREFORE, in consideration of the promises and mutual covenants herein and for other
good and valuable consideration, the parties hereby agree as follows:

          1. Effectiveness.

     (a) This Addendum shall be effective immediately as of the Effective Time
(other than with respect to the covenants set forth in the immediately following
sentence, which shall be effective immediately); in the event that the Merger does
not occur for any reason or the Merger Agreement terminates prior to the occurrence
of the Merger, this Addendum shall terminate, and shall be of no further force or
effect. From and after the date of this Addendum and continuing until the Effective
Time, the parties hereto acknowledge and agree that (i) Employee’s employment shall
continue to be subject to the terms and conditions of the Unamended Employment
Agreement, (ii) Employee agrees not to terminate his employment with the Company for
any reason (including, without limitation, for “Good Reason” (as defined in the
Unamended Employment
Agreement)) on or prior to the Effective Time, and (iii) the Company agrees not

 

 

to take any actions that would constitute “Good Reason” for Employee to terminate
his employment, and not to otherwise terminate the employment of Employee for any
reason, on or prior to the Effective Time, other than for unlawful activity related
to employment, demonstrable fraud or material malfeasance against the Company after
a two thirds majority vote of the Board with prompt and reasonable prior written
notice to Parent, and an opportunity for Parent to investigate and respond prior to
the effectiveness of such termination.

     (b) As of the Effective Time, Employee shall continue Employee’s employment
with the Company in an uninterrupted manner under the terms of the Unamended
Employment Agreement as amended by this Addendum (the “Amended Employment
Agreement”) for the Term set forth herein. Employee acknowledges and agrees that he
shall not terminate his employment pursuant to either the Unamended Employment
Agreement or the Amended Employment Agreement for “Good Reason” due to any
consequences arising from (i) the occurrence of the Merger, (ii) the Company no
longer being a publicly traded company (which may result in a change in Employee’s
duties), (iii) the Company becoming a subsidiary of Parent (which may result in a
change in Employee’s duties), and/or (iv) Employee no longer participating in equity
compensation plans, except that, notwithstanding the foregoing, (x) any reduction in
or failure to timely pay Employee’s base salary as set forth in Section 5 of this
Addendum, or (y) any change in Employee’s duties set forth in Section 3 of this
Addendum without the written consent of Employee, shall constitute Good Reason. The
parties represent, acknowledge and agree that the Merger shall not constitute a
Hostile Change in Control. For purposes of clarity, notwithstanding any of the
foregoing, it shall not be a breach of the Unamended Employment Agreement or of the
Amended Employment Agreement if the Employee resigns from his or her employment with
or without Good Reason after the Effective Time (it being acknowledged that if
Employee resigns without Good Reason, he shall not receive any severance
compensation of any kind under the Unamended Employment Agreement or the Amended
Employment Agreement).

          2. Term. Notwithstanding the first three sentences of Section 4 of the Unamended
Employment Agreement (which the parties agree shall not be effective after the Effective Time), the
Term under the Amended Employment Agreement will expire on the second anniversary of the Effective
Time, unless the Parent requests in writing, exercisable by notice given to Employee at least 60
days prior to such expiration date, that the Term continue for an additional year, in which case
the Amended Employment Agreement will expire on the third anniversary of the Effective Time.

          3. Position and Responsibilities. Section 3(a) of the Unamended Employment Agreement
is amended to delete such provision in its entirety, and to insert the following in its place:

“Employee shall serve the Employer, the Company and Parent, as a Senior International Advisor and
shall serve as the Chairman of the Company. Employee’s responsibilities will include
advising the parties on creating shareholder value; advising the Company and Parent on

2

 

 integration
and synergies with the Parent’s other business, and advising the Parent on its international
business development. Employee shall also serve on the Parent’s International Strategic Committee.”

          4. Restrictive Covenants and Confidentiality. Section 7 of the Unamended Employment
Agreement is amended to delete the provisions therein in their entirety, and to insert the
following in its place:

     (a) Non-Compete. During Employee’s employment with the Employer, and for a
two-year period after the date Employee’s employment is terminated for any reason
(the “Restricted Period”), Employee shall not directly or indirectly:

     i. hold a 5% or greater equity (including stock options whether or not
exercisable), voting or profit participation interest in a Competitive
Enterprise, or

     ii. associate (including as a director, officer, employee, partner,
consultant, agent or advisor) with a Competitive Enterprise, or

     iii. engage, or directly or indirectly manage or supervise personnel
engaged, in any activity on behalf of any Competitive Enterprise:

(A) that is substantially related to any activity that
Employee was engaged in with the Employer during the 12
months prior to Employee’s termination date;

(B) that is substantially related to any activity for
which Employee had direct or indirect managerial or
supervisory responsibility with the Employer during the 12
months prior to Employee’s termination date; or

(C) that calls for the application of specialized knowledge
or skills substantially related to those used by Employee in
his activities with the Employer during the 12 months prior
to Employee’s termination date.

For purposes of this Agreement, “Competitive Enterprise” means any business enterprise that either
(i) engages in any activity in the insurance business or industry, or in insurance related
services, such as the insurance agent and broker businesses, or (ii) holds a 5% or greater equity,
voting or profit participation interest in any enterprise that engages in the insurance business or
industry, or in insurance related services, such as the insurance agent and broker businesses.

     (b) Non-Solicit. During the Restricted Period, Employee shall not, in any
manner, directly or indirectly (without the prior written consent of the Employer):
(i) Solicit any Client to transact business with a Competitive
Enterprise or to reduce or refrain from doing any business with the Employer,

3

 

(ii) transact business with any Client that would cause Employee to be a Competitive
Enterprise, (iii) interfere with or damage any relationship between the Employer and
a Client or (iv) Solicit anyone who is then an employee or consultant of the
Employer (or who was an employee of the Employer within the prior 12 months) to
resign from the Employer or to apply for or accept employment or engagement with any
other business or enterprise.

For purposes of this Agreement, a “Client” means any client or prospective client of the Employer
to whom Employee provided services, or for whom Employee transacted business, or whose identity
became known to Employee in connection with his relationship with or employment by the Employer,
and “Solicit” means any direct or indirect communication of any kind, regardless of who initiates
it, that in any way invites, advises, encourages or requests any person to take or refrain from
taking any action.

     (c) Confidential Information. Employee hereby acknowledges that, as an
employee of the Employer, he will be making use of, acquiring and adding to
confidential information of a special and unique nature and value relating to the
Employer and its strategic plan and financial operations. Employee further
recognizes and acknowledges that all confidential information is the exclusive
property of the Employer, is material and confidential, and is critical to the
successful conduct of the business of the Employer. Accordingly, Employee hereby
covenants and agrees that he will use confidential information for the benefit of
the Employer only and shall not at any time, directly or indirectly, during the Term
and thereafter divulge, reveal or communicate any confidential information to any
person, firm, corporation or entity whatsoever, or use any confidential information
for his own benefit or for the benefit of others. Notwithstanding the foregoing,
Employee shall be authorized to disclose confidential information (i) as may be
required by law or legal process after providing the Employer with prior written
notice and an opportunity to respond to such disclosure (unless such notice is
prohibited by law), (ii) in any criminal proceeding against him after providing the
Employer with prior written notice and an opportunity to seek protection for such
confidential information and (iii) with the prior written consent of the Employer.

     (d) Survival. Any termination of Employee’s employment shall have no effect on
the continuing operation of this Section 7.

     (e) Validity. The terms and provisions of this Section 7 are intended to be
separate and divisible provisions and if, for any reason, any one or more of them is
held to be invalid or unenforceable, neither the validity nor the enforceability of
any other provision of the Amended Employment Agreement shall thereby be affected.
The parties hereto acknowledge that the potential restrictions on Employee’s future
employment imposed by this Section 7 are reasonable in both duration and geographic
scope and in all other respects. If for any reason any court of competent
jurisdiction shall find any provisions of this Section 7 unreasonable in duration or
geographic scope or otherwise, Employee
and the Employer agree that the restrictions and prohibitions contained herein

4

 

shall be effective to the fullest extent allowed under applicable law in such
jurisdiction.

     (f) Adequate Consideration. The parties acknowledge that this Addendum would
not have been entered into in the absence of Employee’s covenants under this Section
7. In addition, Employee agrees that the payments and benefits that he will receive
in connection with the Merger constitute adequate consideration for the promises
undertaken by him under this Addendum, including without limitation those
specifically set forth in this Section 7.

     (g) Remedies. Employee agrees that if Employee breaches or threatens to breach
any of the provisions of this Section 7 or Section 11 of the Amended Employment
Agreement, the Employer will have available, in additional to any other right or
remedy available, the right to obtain injunctive and equitable relief of any type
from a court of competent jurisdiction, including but not limited to restraining
such breach or threatened breach and to specific performance any such provision of
the Amended Employment Agreement. Employee further agrees that no bond or other
security shall be required in obtaining such equitable relief and Employee hereby
consents to the issuance of such injunction and to the ordering of specific
performance.

     (h) Definition of Employer. The term “Employer”, as used in this Section 7,
and in Section 2(b), and Section 11, of the Amended Employment Agreement, shall
include the Company, the Employer, Parent and all of their respective Affiliates.

          5. Compensation. As of the Effective Time, Employee’s base salary shall be increased
to a rate of $2,000,000 per year. As of the Effective Time, Employer shall provide Employee with
compensation opportunities comparable in the aggregate to those provided to Employee immediately
prior to the Merger, taking into account the increase in base salary set forth in the first
sentence of this paragraph, on a risk-adjusted basis.

          6. Gross up Under Section 280G. The parties confirm that Employee is (both prior to
the Effective Time, and on and following the Effective Time) entitled to the full “golden parachute
adjustment” as described and provided in Section 9 of the Unamended Employment Agreement. The
manner of making the computation of the amount provided in Section 9 with respect to the
acceleration provided in Sections 4.3(a), (b), (c), (d) and (e), respectively, of the Merger
Agreement (the “Acceleration”) will be as mutually agreed between Parent and the Company between
the date of this Addendum and the Effective Time, and such amount with respect to the Acceleration
will be paid to Employee within ten (10) business days of the Effective Time.

          7. Release Requirement Clarification. The first paragraph of Section 6(a) of the
Employment Agreement is amended to add, in the first sentence, after the word “Control)” and before
the comma, the words “which shall be provided to Employee within ten (10) days of the cessation of
Employee’s employment”.

5

 

          8. General. Capitalized terms not otherwise defined in this Addendum have the
meanings ascribed to such terms in the Unamended Employment Agreement. All terms of the Unamended
Employment Agreement that have not been amended by this Addendum shall continue in full force and
effect under the Amended Employment Agreement from and after the Effective Time. Parent shall be a
party to the Amended Employment Agreement from and after the Effective Time, and shall be
considered a party for all relevant purposes, including, for clarity, for provisions relating to
Affiliates, amendments, notices to the parties, release of the Employer, Notice of Termination (at
the address for Parent set forth in the Merger Agreement), restrictive covenants, and protection of
Employer property and information, but, for clarity, not for purposes of employment, compensation,
benefits, position, authority, title or duties.

6

 

          IN WITNESS WHEREOF, the parties hereto have executed this Addendum as of the date first above
written.

	 	 	 	 	 
	 	PHILADELPHIA CONSOLIDATED

HOLDING CORP. 

 	 
	 	By:  	/s/
Craig P. Keller

	 
	 	 	Name:  	Craig P. Keller	 
	 	 	Title:  	CFO	 
	 
	 
	 	MAGUIRE INSURANCE AGENCY, INC.

 	 
	 	By:  	/s/
Craig P. Keller	 
	 	 	Name:  	Craig P. Keller	 
	 	 	Title:  	CFO	 
	 
	 
	 	TOKIO MARINE HOLDINGS, INC.

 	 
	 	By:  	/s/
Shuzo Sumi	 
	 	 	Name:  	Shuzo Sumi 	 
	 	 	Title:  	President 	 
	 
	 
	 	JAMES J. MAGUIRE

 	 
	 	By:  	/s/
James J. Maguire

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