Document:

NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES
REPRESENTED BY THIS NOTE NOR THE SECURITIES INTO WHICH
THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY
NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I)
IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR (B) AN OPINION OF COUNSEL
(WHICH COUNSEL SHALL BE SELECTED BY THE
HOLDER), IN A GENERALLY ACCEPTABLE FORM,
THAT REGISTRATION IS NOT REQUIRED UNDER SAID
ACT OR (II) UNLESS SOLD PURSUANTTORULE144ORRULE144AUNDERSAIDACT.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY
BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR
FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

 

Principal
Amount: $335,000

Date:
January 5, 2017

 

PROMISSORY
NOTE

 

Rich
Pharmaceuticals, Inc., (hereinafter called
the “Company”), hereby promises
to pay to the order of GHS
Investments, LLC, a Nevada Limited Liability Company,
or its registered assigns (the “Holder”) the sum of $335,000 on
October 5, 2017, (the "Maturity Date") together with any
interest as set forth herein, and
to pay interest on the unpaid principal
balance hereof at the rate of
ten percent (10%) (the “Interest
Rate”) per annum from the date
hereof (the “Issue Date”)
until the same becomes due and
payable, whether at maturity or upon acceleration
or by prepayment or otherwise.

 

 

This
Note is being issued with a ten percent (10%) original issuance discount and with an initial $5,000 being withheld by the Holder
to offset transaction costs. Holder shall only retain beneficial ownership over those amounts (and corresponding interest(s))
which Holder has actually funded in accordance with the schedule outlined in the Securities Purchase Agreement of same Date.

 

 

This
Note may not be prepaid in whole or in part
except as otherwise explicitly set forth herein. Following any Event of Default,
all amounts owing pursuant to this Note shall bear interest at
the rate of twenty percent
(20%) per annum from the due date thereof
until the same is paid (“Default
Interest”). Interest shall be computed
on the basis of a 365-day year
and the actual number of days
elapsed. All payments due hereunder (to
the extent not converted into common stock)
shall be made in lawful money
of the United States of America.

 

All
payments shall be made at such address as
the Holder shall hereafter give to the
Company by written notice
made in accordance with the provisions
of this Note. Whenever any amount
expressed to be due by the terms
of this Note is due on any day which
is not a business day, the same shall instead
be due on the next succeeding day
which is a business day and, in the
case of any interest
payment date which is not the date on which this Note is paid
in full, the extension of the
due date thereof shall not be taken
into account for purposes of determining
the amount

    	 	 	 

    		 

    

of
interest due on such date. As used in
this Note, the term “business day”
shall mean any day other than
a Saturday, Sunday or a day on which
commercial banks in the city of New York, New York are authorized or required
by law or executive order to remain
closed.

Each
capitalized term used herein, and not otherwise
defined, shall have the meaning ascribed thereto in the supporting documents
of same date (attached hereto).

 

This
Note is free from all taxes, liens, claims
and encumbrances with respect to the issue
thereof and shall not be subject to preemptive rights or other
similar rights of shareholders of the Company
and will not impose personal
liability upon the holder thereof.

 

The
following terms shall apply to this Note:

 

ARTICLE
I. CONVERSION
RIGHTS

 

1.1             
Conversion Right. The Holder shall have
the right and at any time following execution of this Note, to convert
all or any part of the outstanding
and unpaid principal amount of this Note into fully paid
and non- assessable shares of Common Stock, as such Common Stock exists on
the Issue Date, or any
shares of capital
stock or other securities of the Company
into which such Common Stock shall hereafter
be changed or reclassified at
the conversion price (the “Conversion Price”) determined as provided herein
(a “Conversion”); provided, however, that in no event shall
the Holder be entitled to convert
any portion of this Note in excess
of that portion of this Note upon conversion
of which the sum of (1) the number
of shares of Common Stock beneficially owned by the Holder
and its affiliates (other than shares of Common Stock which
may be deemed beneficially owned
through the ownership of the unconverted
portion of the Notes or the unexercised or unconverted
portion of any other security of the Company subject
to a limitation on conversion or exercise
analogous to the limitations contained herein) and (2) the number of
shares of Common Stock issuable
upon the conversion of the portion of this Note with respect
to which the determination of
this proviso is being made, would result
in beneficial ownership by the
Holder and its affiliates of more
than 4.99% of the outstanding shares of Common Stock. For
purposes of the proviso to the
immediately preceding sentence, beneficial ownership shall
be determined in accordance with
Section 13(d) of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”), and Regulations 13D-G
thereunder. The number of shares of
Common Stock to be issued upon each conversion
of this Note shall be determined
by dividing the Conversion Amount (as
defined below) by the applicable Conversion Price then in effect
on the date specified in the notice
of conversion, (the “Notice of Conversion”),
delivered to the Company by the
Holder in accordance with the Sections
below; provided that the Notice of Conversion
is submitted by facsimile
or e-mail (or by other
means resulting in, or reasonably expected to result
in, notice) to the Company before
6:00 p.m., New York, New York time on such
conversion date (the “Conversion Date”). Notwithstanding the foregoing, the term "4.99%" above shall
be replaced with "9.99%" following any Event of Default if the Holder, in its sole discretion and in writing, elects
to demand the replacement. If the term "4.99%" is replaced with "9.99%" pursuant to the preceding sentence,
such increase to "9.99%" shall remain at 9.99% until decreased by the Holder in writing.

 

The
number of shares of Common Stock to be
issued upon each conversion of this
Note shall be determined by
dividing the Conversion Amount (as defined
below) by the applicable Conversion Price
then in effect on the date specified
in the notice of conversion, (the “Notice
of Conversion”), delivered to the Company
by the Holder in accordance
with the Sections below.

    	 	2	 

    		 

    

 

The
term “Conversion Amount” means,
with respect to any conversion
of this Note, the sum of (1)  
the principal amount of this Note to be converted
in such conversion plus (2) at
the Company’s option, accrued and
unpaid interest, if any, on such principal
amount at the interest rates provided
in this Note to the Conversion Date,
plus (3) at the Company’s option,
Default Interest, if any, on the amounts
referred to in the immediately preceding clauses
(1) and/or (2) plus (4) at
the Holder’s option, any amounts owed
to the Holder.

 

		1.2	Conversion
                                         Price.

 

(a)               
Calculation of Conversion Price.Holder,
at its discretion, shall have the right to convert this Note in its entirety or in part(s) into common stock of the Company valued
at a forty percent (40%) discount off of the lowest intra-day trading price for the Company’s common stock during the ten
(10) trading days immediately preceding a conversion date, as reported by Quotestream Media.

 

If
at any time after the execution of this Note, the Company experiences a "DTC Chill," the Conversion Price Discount shall
be increased by five percent (5%). If at any time following the execution of this Note, the Company becomes ineligible to participate
in the DTC's "DWAC" system, the Conversion Price Discount will be increased by five percent (5%). Following any Event
of Default, the Conversion Price discount shall be permanently increased by ten percent (10%).

 

1.3             
Authorized Shares. The Company
covenants that within sixty (60) calendar days from the execution of this
Note and during the period the conversion
right exists the Company will reserve from
its authorized and unissued Common Stock
a sufficient number of shares, free
from preemptive rights, to provide
for the issuance of Common Stock upon the full
conversion of this Note. The Company is required at
all times to have authorized and reserved three times
the number of shares that is actually issuable
upon full conversion of the Note (based on the Conversion
Price of the Notes in effect
from time to time)(the “Reserved Amount”). The Reserved
Amount shall be increased from
time to time in accordance with the Company’s
obligations.

 

The
Company represents that upon issuance,
such shares will be duly and validly issued, fully paid
and non-assessable. In addition, if
the Company shall issue any securities
or make any change to its capital
structure which would change the number of shares
of Common Stock into which the Notes
shall be convertible at the then current
Conversion Price, the Company shall at the same
time make proper provision so that thereafter
there shall be a sufficient number
of shares of Common Stock authorized and reserved,
free from preemptive rights, for conversion
of the outstanding Notes.

 

The
Company (i) acknowledges that
it will irrevocably instruct its transfer agent
to issue certificates for the Common Stock issuable
upon conversion of this Note, and (ii)
agrees that its issuance of this Note shall
constitute full authority to its officers and agents
who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates
for shares of Common Stock in accordance
with the terms and conditions of this Note.

 

If,
at any time
the Company does not maintain
the Reserved Amount it will be considered
an Event of Default as defined in this Note.

    	 	3	 

    		 

    

		1.4	Method
                                         of
                                         Conversion.

 

(a)               
Mechanics of Conversion.
This Note may be converted by the Holder,
in whole or in part, at any time following
execution by submitting to the
Company a Notice of
Conversion (by facsimile,
e-mail or other reasonable means of communication
dispatched on the Conversion Date prior to 6:00 p.m., New York,
New York time).

 

(b)              
Surrender of
Note Upon Conversion.
Notwithstanding anything to the contrary set forth herein, upon conversion
of this Note in accordance with
the terms hereof, the Holder shall not
be required to physically surrender this Note to the
Company unless the entire unpaid principal
amount of this Note is so converted. The Holder and the Company shall
maintain records showing the principal amount so converted
and the dates of such conversions
or shall use such other method, reasonably
satisfactory to the Holder and the Company, so as
not to require physical surrender of this Note upon each
such conversion. In the event of any
dispute or discrepancy, such records of the Holder shall,
prima facie, be controlling and
determinative in the absence of manifest
error. The Holder and any assignee,
by acceptance of this Note,
acknowledge and agree that, by reason of the provisions
of this paragraph, following conversion
of a portion of this Note,
the unpaid and unconverted principal amount of this Note represented
by this Note may be less
than the amount stated on the face hereof.

 

(c)               
Payment of
Taxes.
The Company shall not be
required to pay any tax
which may be payable in respect
of any transfer involved in the issue
and delivery of shares
of Common Stock or other securities or property on conversion
of this Note in a name other than that
of the Holder (or in street name), and
the Company shall not be required
to issue or deliver any such shares
or other securities or property
unless and until the person or persons (other
than the Holder or the custodian
in whose street name such shares are to be held
for the Holder’s account) requesting the issuance thereof
shall have paid to the Company the amount
of any such tax or shall have established
to the satisfaction of the Company
that such tax has been paid.

 

(d)              
Delivery of
Common Stock Upon Conversion. Upon
receipt by the Company
from the Holder of a facsimile
transmission or e-mail (or other reasonable means of communication)
of a Notice of Conversion meeting
the requirements for conversion as provided in this Section,
the Company shall issue and
deliver or cause to be issued and delivered to or upon the order
of the Holder certificates for the Common Stock issuable
upon such conversion within three (3)
business days after such receipt (the “Deadline”) (and, solely
in the case of conversion of the entire
unpaid principal amount hereof, surrender of this Note) in accordance
with the terms hereof and the Purchase Agreement.

 

Within
Five (5) business days of having received common stock pursuant to a Notice of Conversion and prior to having traded any shares
from that specific conversion, Holder may elect to rescind the Notice of Conversion and return the shares, at Holder's expense,
to the Company's Transfer Agent. In the event of such rescission, the principal amount outstanding under this Note shall be adjusted
to include the Conversion Amount which was deducted from the Note as part of the rescinded Notice of Conversion.

 

(e)               
Obligation of Company
to Deliver Common Stock.
Upon receipt by the Company
of a Notice of Conversion, the Holder shall be deemed to be the holder
of record of the Common Stock issuable
upon such conversion, the outstanding principal
amount and the amount of accrued and
unpaid interest on this Note shall be reduced
to reflect such conversion, and, unless the Company
defaults on its obligations under
this Article I, all
rights

    	 	4	 

    		 

    

with
respect to the portion of this Note
being so converted shall forthwith terminate
except the right to receive the
Common Stock or other securities, cash or other
assets, as herein provided, on such
conversion. If the Holder shall
have given a Notice of
Conversion as provided herein,
the Company’s obligation to issue
and deliver the certificates for Common Stock shall
be absolute and unconditional, irrespective of
the absence of any action by the
Holder to enforce the same,
any waiver or consent with respect
to any provision thereof, the recovery
of any judgment against any
person or any action to enforce
the same, any failure or delay in the enforcement
of any other obligation of the Company
to the holder of record, or any
setoff, counterclaim, recoupment, limitation or termination, or any breach
or alleged breach by the Holder
of any obligation to the Company,
and irrespective of any other
circumstance which might otherwise limit
such obligation of the Company to the
Holder in connection with such conversion.
The Conversion Date specified in the Notice
of Conversion shall be the Conversion
Date so long as the Notice of
Conversion is received by the Company
before 6:00 p.m., New York, New York
time, on such date.

 

(f)               
Delivery of
Common Stock by Electronic Transfer.In
lieu of delivering physical certificates
representing the Common Stock issuable upon conversion,
provided the Company is participating in the Depository Trust Company (“DTC”)
Fast Automated Securities Transfer (“FAST”) program, upon request
of the Holder and its compliance
with the provisions contained in Section 1.1 and
in this Section 1.4, the Company shall use its best
efforts to cause its transfer
agent to electronically transmit the Common
Stock issuable upon conversion to the Holder
by crediting the account of Holder’s
Broker with DTC through its Deposit
Withdrawal Agent Commission (“DWAC”) system.

 

(g)  
Failure to Deliver Common Stock Prior
to Deadline.
Without in any way limiting the Holder’s
right to pursue other remedies, including actual damages and/or equitable relief,
the parties agree that if delivery of the Common Stock issuable
upon conversion of this Note is not delivered
by the Deadline the Company shall
pay to the Holder $2,000 per day in cash,
for each day beyond
the Deadline that the Company fails to deliver
such Common Stock. Such cash amount shall be paid
to Holder by the fifth
day of the month following the
month in which it has accrued or, at
the option of the Holder (by written notice
to the Company by the first day
of the month following the month in which
it has accrued), shall be added to the principal
amount of this Note, in which event
interest shall accrue thereon in accordance
with the terms of this Note and such
additional principal amount shall be convertible into Common Stock in accordance
with the terms of this Note.
The Company agrees that the right to
convert is a valuable right to the Holder.
The damages resulting from a failure,
attempt to frustrate, interference with such
conversion right are difficult if not impossible to qualify.Accordingly
the parties acknowledge that the liquidated
damages provision contained in this Section are justified. Any delay or failure
of performance by the Company hereunder shall be excused if and to the extent caused by Force Majeure. For purposes of this agreement,
Force Majeure shall mean a cause or event that is not reasonably foreseeable and not caused by the Company, including acts of
God, fires, floods, explosions, riots wars, hurricanes, etc.

 

1.5             
Concerning the Shares. The shares
of Common Stock issuable upon conversion
of this Note may not be sold or transferred
unless (i) such shares are sold pursuant to an effective registration statement under
the Act or (ii) the Company
or its transfer agent shall
have been furnished with an opinion
of counsel (which opinion shall be in
form, substance and scope customary for
opinions of counsel in comparable transactions)
to the effect that the shares
to be sold or transferred may be sold or transferred pursuant
to an exemption from such registration
or (iii) such shares are sold or
transferred pursuant to Rule 144 under
the Act (or a

    	 	5	 

    		 

    

successor
rule) (“Rule
144”) or (iv) such shares are
transferred to an “affiliate” (as defined in Rule 144) of the
Company who agrees to sell
or otherwise transfer the shares only in accordance
with this Section 1.5 and who
is an Accredited Investor. Except as otherwise
provided herein (and subject to the removal
provisions set forth below), until such time as the shares of Common Stock
issuable upon conversion of this Note
have been registered under the Act or
otherwise may be sold pursuant to Rule 144 without any restriction as to the number
of securities as of a particular date
that can then be immediately
sold, each certificate for shares of Common Stock issuable
upon conversion of this Note that has not been
so included in an effective registration
statement or that has not been
sold pursuant to an effective registration
statement or an exemption that permits
removal of the legend, shall bear a legend
substantially in the following form, as appropriate:

 

“NEITHERTHEISSUANCEANDSALEOFTHESECURITIES
REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICHTHESESECURITIESAREEXERCISABLEHAVEBEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR
SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE
SELECTED BY THEHOLDER),INAGENERALLYACCEPTABLEFORM,THAT
REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144
OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE
PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN OR FINANCING ARRANGEMENT SECURED BY
THE SECURITIES.”

 

The
legend set forth above shall be removed
and the Company shall issue to the Holder
a new certificate therefore free of any
transfer legend if (i) the Company
or its transfer agent shall have received an
opinion of counsel, in form, substance and scope customary for opinions of
counsel in comparable transactions,
to the effect that a public sale or transfer
of such Common Stock may be made
without registration under the Act,
which opinion shall be accepted
by the Company so that the sale
or transfer is effected or (ii)
in the case of the Common Stock issuable upon conversion
of this Note, such security is registered
for sale by the Holder under an effective
registration statement filed under the Act or otherwise may
be sold pursuant to Rule 144 without any
restriction as to the number
of securities as of a particular date that
can then be immediately sold.In the
event that the Company does not
accept the opinion of counsel provided
by the Buyer with respect to the transfer
of Securities pursuant to an
exemption from registration, such as Rule 144 or Regulation S, at
the Deadline, it will be considered
an Event of Default pursuant to
this note.

 

		1.6	Effect
                                         of
                                         Certain
                                         Events.

 

(a)               
Effect of Merger, Consolidation, Etc.
At the option of the Holder, the sale,
conveyance or disposition of all or substantially
all of the assets of the Company,
the effectuation by the Company of a
transaction or series of related transactions
in which more than 50% of the voting power of the Company
is disposed of, or the consolidation,
merger or other business combination of the Company
with or into any other Person (as defined
below) or Persons when the Company
is not the survivor shall either: (i) be deemed to be an
Event of Default (as defined in Article III)
pursuant to which the Company
shall be required to pay to the

    	 	6	 

    		 

    

Holder
upon the consummation of and
as a condition to such transaction
an amount equal to the Default Amount
(as defined in Article III)
or (ii) be treated pursuant to
Section 1.6(b) hereof. “Person” shall mean any
individual, corporation, limited
liability company, partnership, association, trust or other
entity or organization.

 

(b)               
Adjustment Due to Merger,
Consolidation, Etc.
If, at any
time when this Note is issued and outstanding
and prior to conversion of all
of the Notes, there shall be any merger,
consolidation, exchange of shares, recapitalization, reorganization,
or other similar event, as a result
of which shares of Common Stock of the Company shall be changed into the same
or a different number of
shares of another
class or classes of stock or securities
of the Company or another entity, or in case
of any sale or conveyance of
all or substantially all of the assets
of the Company other than in connection with a plan
of complete liquidation of the Company, then
the Holder of this Note shall thereafter have
the right to receive upon conversion
of this Note, upon the basis and
upon the terms and conditions specified herein
and in lieu of the shares
of Common Stock immediately theretofore issuable
upon conversion, such stock, securities or assets
which the Holder would have been entitled
to receive in such
transaction had this Note been converted in full
immediately prior to such transaction (without regard
to any limitations on conversion
set forth herein), and in any such case appropriate
provisions shall be made with respect
to the rights and interests of the Holder
of this Note to the end that the
provisions hereof (including, without limitation,
provisions for adjustment of the Conversion Price and of the number of shares
issuable upon conversion of the Note)
shall thereafter be applicable, as nearly as
may be practicable in relation
to any securities or assets thereafter deliverable
upon the conversion hereof. The Company shall not affect
any transaction described in this Section
1.6(b) unless (a) it first gives, to
the extent practicable, thirty (30) days prior
written notice (but in any event at
least fifteen (15) days prior written
notice) of the record date of the special meeting of shareholders
to approve, or if there is no such record date, the consummation
of, such merger, consolidation, exchange
of shares, recapitalization, reorganization
or other similar event or sale
of assets (during which time the Holder
shall be entitled to convert
this Note) and (b) the resulting successor
or acquiring entity (if not the Company) assumes
by written instrument the obligations
of this Section 1.6(b). The above provisions
shall similarly apply to successive consolidations, mergers,
sales, transfers or share exchanges.

 

(c)          
Adjustment Due to Distribution. If
the Company shall declare or make
any distribution of its assets (or rights
to acquire its assets) to holders
of Common Stock as a dividend, stock
repurchase, by way of return
of capital or otherwise (including any
dividend or distribution to the
Company’s shareholders in cash
or shares (or rights to acquire shares) of capital
stock of a subsidiary (i.e., a spin-off))
(a “Distribution”), then the Holder of this Note shall
be entitled, upon any conversion
of this Note after the date of record
for determining shareholders entitled to such Distribution,
to receive the amount of such
assets which would have been payable
to the Holder with respect to
the shares of Common Stock issuable
upon such conversion had such Holder been
the holder of such shares of Common Stock on the record
date for the determination of shareholders
entitled to such Distribution.

 

(d)              
Adjustment Due to Dilutive Issuance.
If, at any time when any Notes issued under the Securities Purchase Agreement of even date herewith are issued and outstanding,
the Company issues or sells, or in accordance with this Section 1.6(d) hereof is deemed to have issued or sold, any shares of
Common Stock in connection with a financing transaction based on a variable price formula (the “Alternative Variable Price
Formula”) that is more favorable to the investor in such financing transaction than the formula for calculating the Conversion
Price in effect on the date of such issuance (or deemed issuance) of such shares of Common Stock (a “Dilutive Issuance”),
then immediately upon the Dilutive Issuance, the formula for the Conversion Price will be adjusted to match the Alternative Variable
Price Formula. If it is unclear whether the Alternative Variable Price Formula is better or worse, then Holder, in its sole discretion,
may elect at the time of such issuance whether to switch to the Alternative Variable Price Formula or not.

    	 	7	 

    		 

    

(e)               
Purchase Rights. If, at any time
when any Notes are issued and outstanding,
the Company issues any convertible
securities or rights to purchase stock,
warrants, securities or other property (the
“Purchase Rights”) pro rata to the record
holders of any class of Common Stock,
then the Holder of this Note will be entitled
to acquire, upon the terms applicable
to such Purchase Rights, the aggregate
Purchase Rights which such Holder could have acquired if such Holder had held
the number of shares of Common Stock
acquirable upon complete conversion
of this Note (without regard to any limitations
on conversion contained herein) immediately before
the date on which a record is
taken for the grant, issuance or sale
of such Purchase Rights or, if no such
record is taken, the date as
of which the record holders of Common
Stock are to be determined for the grant,
issue or sale of such Purchase
Rights.

 

(f)               
Notice of Adjustments. Upon the
occurrence of each
adjustment or readjustment of the Conversion Price
as a result of the events described in this Section
1.6, the Company, at its expense,
shall promptly compute such adjustment
or readjustment and prepare and furnish to the Holder
of a certificate setting forth such
adjustment or readjustment and showing in detail
the facts upon which such adjustment or readjustment
is based. The Company shall,
upon the written request at any time of the Holder,
furnish to such Holder a like certificate
setting forth (i) such adjustment or readjustment, (ii) the Conversion
Price at the time in effect and (iii) the number
of shares of Common Stock and
the amount, if any, of other
securities or property which at the time would be received
upon conversion of the Note.

 

1.7             
Security As Security for the Company's
obligations contained herein and in all Notes issued by the Company to the Holder, following any Event of Default which
remains uncured for thirty (30) calendar days, the Holder shall be granted an unconditional first priority interest in
and to, any and all property of the Company and its subsidiaries, of any kind or description, tangible or intangible, whether
now existing or hereafter arising or acquired until the balance of all Notes has
been reduced to $0. "Any and all property," as described herein shall be inclusive of, but not limited to, assets reported
by the Company on its SEC filings, cash, inventory, accounts receivable, intellectual property rights, equipment and or property.
The Investor is authorized to make all filings the Investor, in its discretion, deems necessary to evidence its security interests.

 

1.8             
Status as Shareholder. Upon submission
of a Notice of Conversion by a Holder,
(i) the shares covered thereby (other than the shares,
if any, which cannot be issued
because their issuance would exceed
such Holder’s allocated portion of the Reserved
Amount or Maximum Share Amount) shall
be deemed converted into shares
of Common Stock and (ii) the Holder’s
rights as a Holder of such
converted portion of this Note shall cease and terminate, excepting only the
right to receive certificates for such
shares of Common Stock and to any remedies
provided herein or otherwise available at law or in equity to such Holder
because of a failure by the Company
to comply with the terms of this Note. Notwithstanding
the foregoing, if a Holder has not received certificates
for all shares of Common Stock prior to the tenth
(10th) business day after the expiration
of the Deadline with respect to a conversion of any portion
of this Note for any reason, then (unless
the Holder otherwise elects to retain its status
as a holder of Common Stock by so notifying the Company) the Holder
shall regain the rights of a Holder
of

    	 	8	 

    		 

    

this
Note with respect to such unconverted
portions of this Note and the Company
shall, as soon as practicable, return such
unconverted Note to the Holder or, if the Note has not been surrendered,
adjust its records to reflect
that such portion of this Note has not
been converted. In all
cases, the Holder shall retain all
of its rights and remedies (including, without limitation,
(i) the right to receive Conversion
Default Payments pursuant to Section
1.3 to the extent required thereby for
such Conversion Default and any
subsequent Conversion Default and (ii)
the right to have the Conversion
Price with respect to subsequent conversions
determined in accordance with Section
1.3) for the Company’s failure
to convert this Note.

 

1.9             
Prepayment. Maker may prepay this Note, in accordance with the following schedule:
If within 60 calendar days from the execution of this Note, 120% of all outstanding principal and interest due on each outstanding
Note in one payment; After 60 calendar days from the execution of the note and within 120 days from execution, 130% of all outstanding
principal and interest due on each outstanding Note in one payment. Between 121 and 180 days from the date of execution, the Note
may be prepaid for 135% of all outstanding amounts due on each outstanding Note in one payment.

 

ARTICLE
II. CERTAIN
COVENANTS

 

2.1             
Distributions on Capital
Stock. So long as
the Company shall have any
obligation under this Note, the Company
shall not without the Holder’s
written consent (a) pay, declare
or set apart for such payment, any dividend
or other distribution (whether in cash,
property or other securities) on shares
of capital stock other than dividends
on shares of Common Stock solely
in the form of additional shares of
Common Stock or (b) directly or indirectly or through
any subsidiary make any
other payment or distribution in respect
of its capital stock except for distributions pursuant to any
shareholders’ rights plan which is approved
by a majority of the Company’s disinterested
directors.

 

2.2             
Restriction on Stock Repurchases.
So long as the Company shall
have any obligation under this Note,
the Company shall not without the Holder’s
written consent redeem, repurchase
or otherwise acquire (whether for cash
or in exchange for property or other
securities or otherwise) in any one transaction
or series of related transactions
any shares of
capital stock of the Company or
any warrants, rights or options to purchase
or acquire any such shares.

 

2.3             
Borrowings. So long as the Issuer
shall have any obligation under this
Note, the Issuer shall not, without providing
the Holder with written notice,
create, incur, assume guarantee, endorse, contingently agree to purchase
or otherwise become liable upon
the obligation of any person, firm,
partnership, joint venture or corporation, except
by the endorsement of negotiable
instruments for deposit or collection, or
suffer to exist

any
liability for borrowed money, except (a) borrowings in existence
or committed on the date hereof and
of which the Issuer has
informed Holder in writing prior to the date hereof, (b) indebtedness to trade
creditors or financial institutions incurred
in the ordinary course of business or (c)
borrowings, the proceeds of which shall
be used to repay this Note.

 

2.4             
Sale of Assets.
So long as the Company shall have
any obligation under this Note,
the Company shall not, without
the Holder’s written consent, sell, lease
or otherwise dispose of any significant
portion of its assets outside the ordinary
course of business. Any

    	 	9	 

    		 

    

consent
to the disposition
of any assets may be conditioned
on a specified use of the proceeds of
disposition.

 

2.5             
Advances and Loans. So long as the
Company shall have any
obligation under this Note, the
Company shall not, without the
Holder’s written consent, lend money, give credit
or make advances to any person, firm,
joint venture or corporation, including,
without limitation, officers, directors, employees, subsidiaries and affiliates
of the Company, except loans, credits
or advances (a) in existence or committed
on the date hereof and which the Company
has informed Holder in writing prior
to the date hereof, (b) made in the ordinary course
of business or (c) not in excess
of $50,000.

 

ARTICLE
III. EVENTS
OF DEFAULT

 

If
any of
the following events of default (each,
an “Event of Default”) shall
occur:

 

3.1             
Failure to Pay Principal or
Interest.The Company
fails to pay the principal
hereof or interest thereon when due on this Note,
whether at maturity, upon acceleration or otherwise.

 

3.2             
Conversion and the Shares.The
Company fails to issue shares of Common
Stock to the Holder (or announces or threatens
in writing that it will not honor its obligation to do so) upon exercise
by the Holder of the conversion
rights of the Holder in accordance with the terms of this Note,
fails to transfer or cause its
transfer agent to transfer (issue) (electronically
or in certificated form) any certificate for
shares of Common Stock issued to the Holder
upon conversion of or otherwise pursuant to this Note as
and when required by this Note, the Company
directs its transfer agent not
to transfer or delays, impairs, and/or hinders
its transfer agent in transferring (or
issuing) (electronically or in certificated form) any certificate
for shares of Common Stock to be issued to the Holder
upon conversion of or otherwise pursuant
to this Note as and when required by
this Note, or fails to remove (or directs
its transfer agent not to remove or
impairs, delays, and/or hinders its transfer
agent from removing) any restrictive legend (or to withdraw any stop transfer
instructions in respect thereof) on any certificate
for any shares of Common Stock issued
to the Holder upon conversion
of or otherwise pursuant to this Note as and when required by this Note (or
makes any written announcement, statement
or threat that it does not intend
to honor the obligations described in this paragraph) and
any such failure shall continue uncured (or
any written announcement, statement or threat
not to honor its obligations shall not be rescinded
in writing) for three (3) business days
after the Holder shall have delivered a Notice of Conversion.
It is an obligation of the Company
to remain current in its obligations
to its transfer agent. It shall
be an event of default of this Note,
if a conversion of this Note is delayed,
hindered or frustrated due to a balance
owed by the Company to its transfer agent. If
at the option of the Holder,
the Holder advances any funds to the
Company’s transfer agent in order
to process a conversion, such advanced funds
shall be paid by the Company to
the Holder within forty eight (48) hours
of a demand from the Holder.

 

3.3             
Breach of Covenants.
The Company breaches any covenant
or other term or
condition contained in this Note and
any collateral documents including
but not limited to the Purchase Agreement.

 

3.4             
Breach of Representations and Warranties.Any
representation or warranty of the Company
made herein or in any agreement, statement
or certificate given in

writing
pursuant hereto or in connection
herewith (including, without limitation,
the Purchase

    	 	10	 

    		 

    

Agreement),
shall be false or misleading
in any material respect when made and
the breach of which has (or with
the passage of time will have) a material adverse effect on the rights of the Holder
with respect to this Note or the Purchase Agreement.

 

3.5             
Receiver or Trustee.
The Company or any subsidiary of
the Company shall make an assignment for
the benefit of creditors, or apply for or consent to the appointment
of a receiver or trustee for it
or for a substantial part of its property
or business, or such a receiver or trustee
shall otherwise be appointed.

 

3.6             
Judgments. Any
money judgment, writ or similar process
shall be entered or filed against
the Company or any subsidiary of the Company
or any of its property or other assets
for more than $50,000, and shall remain unvacated, unbonded or unstayed
for a period of twenty (20) days unless otherwise
consented to by the Holder, which consent
will not be unreasonably withheld.

 

3.7             
Bankruptcy. Bankruptcy,
insolvency, reorganization or liquidation
proceedings or other proceedings,
voluntary or involuntary, for relief under
any bankruptcy law or any law for the
relief of debtors shall be instituted by
or against the Company or any subsidiary
of the Company.

 

3.8             
Delisting of Common Stock.
The Company shall fail to maintain
in good standing the listing of the Common Stock on the OTC
Bulletin Board or an equivalent replacement exchange, the Nasdaq National
Market, the Nasdaq SmallCap Market or the New
York Stock Exchange.

 

3.9             
Failure to Comply with the Exchange
Act. The Company shall fail
to comply, in a timely manner, with the reporting requirements of the Exchange Act;
and/or the Company shall cease to be subject
to the reporting requirements of the Exchange Act.

 

3.10         
Liquidation. Any dissolution, liquidation,
or winding up of Company or any substantial
portion of its business.

 

3.11         
Cessation of Operations.
Any cessation of operations by Company or Company
admits it is otherwise generally
unable to pay its debts as such debts become
due, provided, however, that any
disclosure of the Company’s ability to continue as
a “going concern” shall not be an
admission that the Company cannot
pay its debts as they become due.

 

3.12         
Maintenance of
Assets.
The failure
by Company to maintain
any material intellectual property rights, personal,
real property or other assets which are necessary to conduct
its business (whether now or in the future).

 

3.13         
Financial Statement Restatement.The restatement
of any financial statements filed
by the Company with the SEC for any date
or period from two years prior to the Issue
Date of this Note and until this Note is no longer
outstanding, if the result of such restatement
would, by comparison to the original
financial statement, have constituted a material
adverse effect on the rights of the Holder with respect
to this Note or supporting documents.

 

3.14         
Reverse Splits.
The Company effectuates a reverse split
of its Common Stock without at least twenty (20)
days prior written notice to the Holder.

    	 	11	 

    		 

    

 

3.15          
Replacement
of Transfer Agent.
In the event that the
Company proposes to replace
its transfer agent, the Company
fails to provide, prior to the effective
date of such replacement, a fully executed
Irrevocable Transfer Agent Instructions in a form
as initially delivered pursuant to the Purchase
Agreement (including but not limited to the provision
to irrevocably reserve shares of Common Stock in the
Reserved Amount) signed by the successor
transfer agent to Company and the
Company.

 

3.16          
Cross-Default.
Notwithstanding anything to the contrary contained
in this Note or the other related or companion
documents, a breach or default
by the Company of any
covenant or other term or
condition contained in any of the Other
Agreements, after the passage of all
applicable notice and cure or grace periods, shall,
at the option of the Holder, be
considered a default under this Note
and the Other Agreements, in which
event the Holder shall be entitled (but
in no event required) to apply all rights
and remedies of the Holder under the terms
of this Note and the Other Agreements
by reason of a default under said
Other Agreement or hereunder.“Other Agreements” means, collectively,
all agreements and instruments between, among or
by: (1) the Company, and, or
for the benefit of, (2) the Holder
and any affiliate of the Holder,
including, without limitation, promissory notes;
provided, however, the term “Other
Agreements” shall not include
the related or companion documents to
this Note. Each of the loan transactions will
be cross-defaulted with each other loan transaction
and with all other existing and future
debt of Company.

 

Upon
the occurrence and during the continuation
of any Event of Default specified
in Section 3.1 (solely with respect
to failure to pay the principal hereof
or interest thereon when due at
the Maturity Date), the Note shall become
immediately due and payable and the
Company shall pay
to the Holder, in full satisfaction of
its obligations hereunder, an amount
equal to the Default Sum (as
defined herein).UPON THE OCCURRENCE AND
DURING THE CONTINUATION OF ANY
EVENT OF DEFAULT SPECIFIED IN
SECTION 3.2, THE NOTE SHALL BECOME IMMEDIATELY
DUE AND PAYABLE AND THE COMPANY
SHALL PAY TO THE HOLDER, IN FULL SATISFACTION
OF ITS OBLIGATIONS HEREUNDER, AN
AMOUNT EQUAL TO: (Y) THE DEFAULT SUM (AS
DEFINED HEREIN); MULTIPLIED BY (Z) TWO (2). Upon the occurrence and during the continuation of
any Event of Default specified in Sections 3.1 (solely with respect to failure to
pay the principal hereof or interest
thereon when due on this Note upon a Trading Market Prepayment Event pursuant to Section 1.7 or
upon acceleration), 3.3, 3.4, 3.6, 3.8, 3.9, 3.11, 3.12, 3.13, 3.14, and/or 3. 15
exercisable through the delivery of written notice to the Company by
such Holders (the “Default Notice”), and upon the occurrence of an Event
of Default specified the remaining sections of Articles III (other than failure to pay the principal hereof or interest thereon
at the Maturity Date specified in Section 3,1 hereof), the Note shall become immediately due and payable and the Company
shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount
equal to 150% times the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and
unpaid interest on the unpaid principal amount of this Note to the date of payment (the “Mandatory Prepayment Date”)
plus (y) Default Interest, if any, on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed
to the Holder pursuant to Sections 1.3 and 1.4(g) hereof (the then outstanding principal amount of this Note to the date
of payment plus the amounts referred
to in clauses (x), (y) and (z) shall collectively be known as the “Default Sum”) .

 

If
the Company
fails to pay the Default Amount
within five (5) business days of written
notice that such amount is due and payable, then the Holder
shall have the right at any
time, so long as the Company
remains in default (and so long
and to the extent that there are sufficient

    	 	12	 

    		 

    

authorized
shares), to require
the Company, upon written notice,
to immediately issue, in lieu of the
Default Amount, the number of shares
of Common Stock of the Company equal
to the Default Amount divided
by the Conversion Price then in effect.

 

ARTICLE
IV. MISCELLANEOUS

 

4.1             
Failure or Indulgence Not
Waiver. No failure or
delay on the part of the Holder
in the exercise of any power, right or
privilege hereunder shall operate as
a waiver thereof, nor shall any single
or partial exercise of any such
power, right or privilege preclude other or further
exercise thereof or of any other
right, power or privileges.All rights
and remedies existing hereunder are cumulative to, and
not exclusive of, any rights or remedies
otherwise available.

 

4.2             
Notices. All notices, demands, requests,
consents, approvals, and other communications
required or permitted hereunder shall be in writing
and, unless otherwise specified herein, shall be (i)
personally served, (ii) deposited in the mail, registered
or certified, return receipt requested,
postage prepaid, (iii) delivered by
reputable air courier service with charges
prepaid, or (iv) transmitted by
hand delivery, telegram, or facsimile, addressed
as set forth below or to such
other address as such party shall have
specified most recently by written notice.
Any notice or other communication
required or permitted to be given
hereunder shall be deemed
effective (a) upon hand delivery or
delivery by facsimile, with accurate
confirmation generated by the transmitting facsimile
machine, at the address or number designated
below (if delivered on a business
day during normal business hours
where such notice is to be received),
or the first business day
following such delivery (if delivered other than
on a business day during

normal
business hours where such notice is to be received)
or (b) on the second business
day following the date
of mailing by express
courier service, fully prepaid, addressed to such
address, or upon actual receipt
of such mailing, whichever shall first occur.
The addresses for such communications shall be:

 

If
to the Company,
to:

 

___________________ 

 

___________________ 

 

___________________ 

 

If
to the Holder:

 

GHS
Investments, LLC.

200
Stonehinge Lane

Suite
3

Carle
Place, NY 11514

 

4.3             
Amendments. This Note and any
provision hereof may only be amended
by an instrument in writing
signed by the Company and the Holder.
The term “Note” and all reference
thereto, as used throughout this
instrument, shall mean this instrument (and
the other Notes issued pursuant to the Purchase
Agreement) as originally executed, or if later
amended or supplemented, then as so amended
or supplemented.

 

4.4             
Assignability. This Note shall
be binding upon the Company and
its successors and assigns, and shall inure
to be the benefit of the Holder and
its successors and assigns. Notwithstanding anything in this Note to the contrary,
this Note may be pledged as

    	 	13	 

    		 

    

collateral
in connection
with a bona fide margin
account or other lending arrangement.

 

4.5             
Cost of Collection. If
default is made in the payment
of this Note, the Company
shall pay the Holder hereof costs
of collection, including reasonable attorneys’
fees.

 

4.6             
Governing Law.This
Note shall be governed
by and construed in
accordance with the laws of the
State of Nevada without regard to principles
of conflicts of laws.Any
action brought by either
party against the other concerning
the transactions contemplated by this Note
shall be brought only in
the state or federal courts located in the County, City and State of New York.
The parties to this Note hereby irrevocably
waive any objection to jurisdiction
and venue of any action instituted hereunder
and shall not assert any defense
based on lack of jurisdiction
or venue or based upon forum
non conveniens. The Company and
Holder waive trial by jury.
The prevailing party shall be
entitled to recover from the other
party its reasonable attorney's fees and costs. In the event that
any provision of this Note or any other agreement
delivered in connection herewith is invalid
or unenforceable under any applicable
statute or rule of law, then such provision
shall be deemed inoperative to the extent that
it may conflict therewith and shall be deemed
modified to conform with such statute
or rule of law. Any such provision
which may prove invalid or unenforceable
under any law shall not affect
the validity or enforceability of any other provision of any
agreement. Each party hereby irrevocably waives
personal service of process and consents to process
being served in any suit, action
or proceeding in connection with this Agreement
or any other Transaction Document
by mailing a copy thereof via registered
or certified mail or overnight
delivery (with evidence of delivery)
to such party at the address
in effect for notices to it under
this Agreement and agrees that such service shall
constitute good and sufficient service of process
and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right
to serve process in any other manner permitted by
law.

 

4.7             
Certain Amounts.Whenever
pursuant to this Note the Company is required
to pay an amount in excess of
the outstanding principal amount (or the portion
thereof required to be paid at that time)
plus accrued and unpaid interest
plus Default Interest on such interest,
the Company and the Holder agree that
the actual damages to the Holder from
the receipt of cash payment on this
Note may be difficult to determine and
the amount to be so paid by the Company
represents stipulated damages and not a penalty and
is intended to compensate the Holder
in part for loss of the opportunity to convert this Note and
to earn a return from the sale
of shares of Common Stock acquired upon
conversion of this Note at a price
in excess of the price paid for such
shares pursuant to this Note.
The Company and the Holder hereby agree
that such amount of stipulated damages is not plainly disproportionate
to the possible loss to the Holder from the receipt
of a cash payment without the opportunity to convert
this Note into shares of Common Stock.

 

4.8             
Purchase Agreement. By its acceptance of this Note,
each party agrees to be bound by
the applicable terms of the Securities Purchase Agreement
and supporting documents .

 

4.9             
Notice of Corporate Events.
Except as otherwise provided below, the Holder
of this Note shall have no rights as
a Holder of Common Stock unless and only
to the extent that it converts
this Note into Common Stock. The Company shall provide the Holder with prior
notification of any meeting of the Company’s shareholders
(and copies of proxy materials and other information sent to shareholders).
In the event of any taking by
the Company of a record of its shareholders
for the purpose of determining shareholders
who are entitled to receive

    	 	14	 

    		 

    

payment
of any
dividend or other distribution, any
right to subscribe for, purchase or otherwise
acquire (including by way of merger,
consolidation, reclassification or recapitalization) any share of any class
or any other securities or property,
or to receive any other right,
or for the purpose of determining
shareholders who are entitled to vote in connection
with any proposed sale, lease or
conveyance of all or substantially all
of the assets of the Company or
any proposed liquidation, dissolution
or winding up of the Company, the Company
shall mail a notice to the Holder,
at least twenty (20) days prior to the record
date specified therein (or thirty (30) days prior to the consummation
of the transaction or event, whichever
is earlier), of the date on which
any such record is to be taken for
the purpose of such
dividend, distribution, right or other
event, and a brief statement regarding the amount
and character of such dividend, distribution, right
or other event to the extent known at
such time. The Company shall make
a public announcement of any event
requiring notification to the Holder hereunder substantially simultaneously
with the notification to the Holder
in accordance with the terms of this
Section 4.9.

 

4.10         
Remedies.The Company
acknowledges that a breach by
it of its obligations hereunder will cause
irreparable harm to the Holder, by
vitiating the intent and purpose of
the transaction contemplated hereby. Accordingly,
the Company acknowledges that the
remedy at law for a breach of its obligations
under this Note will be inadequate and agrees, in the event
of a breach or threatened breach by
the Company of the provisions of
this Note, that the Holder shall be
entitled, in addition to all
other available remedies at law or in equity, and in addition
to the penalties assessable herein, to an
injunction or injunctions restraining, preventing or curing any
breach of this Note and to enforce
specifically the terms and provisions thereof, without the necessity of
showing economic loss and without any bond or other
security being required. 

 

IN
WITNESS WHEREOF, Company
has caused this Note to be signed in its
name by its duly authorized
officer:

 

 Rich
Pharmaceuticals, Inc.

 

By:
/s/ Ben Chang

 Print:
Ben Chang 

 Title/Date:
CEO 1/5/2017

    	 	15Exhibit 10.1

 

Execution Version

 

NABORS INDUSTRIES, INC.

 

$500,000,000 0.75% EXCHANGEABLE SENIOR NOTES DUE 2024

 

GUARANTEED BY NABORS INDUSTRIES LTD.

 

PURCHASE AGREEMENT

 

CITIGROUP GLOBAL MARKETS INC.

GOLDMAN, SACHS & CO.

 

JANUARY 9, 2017

 

 

January 9, 2017

 

CITIGROUP GLOBAL MARKETS INC.

388 Greenwich Street

New York, New York  10013

 

GOLDMAN, SACHS & CO.

200 West Street

New York, New York 10282-2198

 

As Representatives of the Initial Purchasers

named in Schedule A hereto

 

Dear Ladies and Gentlemen:

 

Nabors Industries, Inc., a Delaware corporation (the “Company”), proposes, upon the terms and conditions set forth in this agreement (the “Agreement”), to issue and sell to the several initial purchasers named in Schedule A hereto (the “Initial Purchasers”) $500,000,000 aggregate principal amount of its 0.75% Exchangeable Senior Notes due 2024 (the “Purchased Notes”). The Company also proposes to grant to the several initial purchasers named in Schedule B hereto (the “Option Purchasers”) an option pursuant to Section 2 hereof to purchase up to an additional $75,000,000 aggregate principal amount of its 0.75% Exchangeable Senior Notes due 2024 solely to cover overallotments (the “Option Notes” and, together with the Purchased Notes, the “Notes”). The Notes are to be issued pursuant to the provisions of an Indenture to be dated as of the Closing Date (as defined in Section 4) (the “Indenture”) among the Company, the Guarantor (as defined below), Wilmington Trust National Association, as Trustee (the “Trustee”) and Citibank N.A., as Exchange Agent and Securities Administrator (the “Securities Administrator”). The Notes will be fully and unconditionally guaranteed (the “Guarantees”) by Nabors Industries Ltd., a Bermuda exempted company (the “Guarantor”).  The Notes and the Guarantees are hereinafter collectively referred to as the “Securities.”

 

The Notes are exchangeable into common shares, par value $0.001 per share (the “Common Shares”) of the Guarantor at the applicable exchange rate set forth in the Final Offering Memorandum (as defined herein).

 

The Securities will be offered by the Initial Purchasers without being registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”),  to persons whom the Initial Purchasers reasonably believe to be qualified institutional buyers (as defined in Rule 144A under the Securities Act (“Rule 144A”)) in compliance with the exemption from registration provided by Rule 144A.

 

In connection with the sale of the Securities, the Company has prepared and delivered to the Initial Purchasers a preliminary offering memorandum, dated January 9, 2017 (together with any exhibits thereto and the documents incorporated by reference therein, the “Offering Memorandum”) and has prepared and delivered a pricing supplement (the “Pricing Supplement”) dated January 9, 2017, in the form attached hereto as Schedule I, describing the terms of the Securities and the Common Shares underlying the Notes, the terms of the offering 

 

1

 

and the Company and the Guarantor, each for use by the Initial Purchasers in connection with their solicitation of offers to purchase the Securities.  As used herein, “Disclosure Package” shall mean the Offering Memorandum, as supplemented by the Pricing Supplement and any written communications (as defined in Rule 405 under the Securities Act) authorized for use pursuant to Section 6(l), each in the most recent form that has been prepared and delivered by the Company to the Initial Purchasers in connection with their solicitation of offers to purchase the Securities as of the Applicable Time.  “Applicable Time” means 11:59 P.M. (New York time) on January 9, 2017.  Promptly after the Applicable Time and in any event no later than the Closing Date, the Company will prepare and deliver to the Initial Purchasers a final offering memorandum (the “Final Offering Memorandum”), which will consist of the Offering Memorandum with only such changes therein as are required to reflect the information contained in the Pricing Supplement, unless the Initial Purchasers consent to such changes.  The Offering Memorandum and the Final Offering Memorandum are each sometimes referred to herein as a “Memorandum.”  As used herein (including the schedule and annexes hereto), the term “Memorandum” shall include in each case the documents incorporated by reference therein.  The terms “supplement”, “amendment” and “amend” as used herein with respect to the Memorandum shall include all documents deemed to be incorporated by reference in the Memorandum that are filed subsequent to the date of the Memorandum with the Commission pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

 

1.     Representations and Warranties

 

The Guarantor and the Company, jointly and severally, represent and warrant to, and agree with each of the Initial Purchasers as of the Applicable Time and as of the Closing Date and each Option Closing Date (as defined herein), that:

 

(a)           (i)            Each document filed or to be filed pursuant to the Exchange Act and incorporated by reference in the Memorandum complied or will comply when so filed or amended in all material respects with the Exchange Act and the applicable rules and regulations of the Commission thereunder, and (ii) as of its date, the Offering Memorandum did not contain, as of the Applicable Time, the Disclosure Package did not contain, and on and, as of its date and the Closing Date and, if applicable, and each Option Closing Date (as defined herein), the Final Offering Memorandum will not contain, any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements in or omissions from the Offering Memorandum, Disclosure Package or the Final Offering Memorandum based upon information relating to the Initial Purchasers furnished to the Company in writing by the Initial Purchasers through the Representatives expressly for use therein, it being understood and agreed that the only such information is that described in Section 8(b).

 

(b)           Each of the Guarantor and the Company has been duly incorporated, organized or formed, is validly existing as a Bermuda exempted company and Delaware corporation, respectively, in good standing under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own its property and to conduct its business as described in the Offering Memorandum and is duly qualified to transact

 

2

 

business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not have a material adverse effect on the Guarantor and its subsidiaries, taken as a whole (a “Material Adverse Effect”).

 

(c)           Each Significant Subsidiary (as defined below) has been duly organized, is validly existing as a corporation or limited partnership in good standing under the laws of the jurisdiction of its organization, has the corporate or limited partnership power and authority to own its property and to conduct its business to the extent described in the Offering Memorandum and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not have a Material Adverse Effect.  All of the issued shares of capital stock (or limited partnership interests) of each Significant Subsidiary have been duly and validly authorized and issued, are fully paid and non-assessable and are owned by the Guarantor, directly or indirectly, free and clear of all liens, encumbrances, equities or claims other than any liens, encumbrances, equities or claims in favor of the Guarantor or another Significant Subsidiary.  “Significant Subsidiaries” shall mean the Company, Nabors International Finance Inc., Nabors Holdings Ltd., Nabors International Management Limited, Nabors Drilling International Limited, Nabors Drilling International II Limited, Nabors Global Holdings Limited, Nabors Global Holdings II Ltd., Nabors Blue Shield Ltd., Nabors Lux Finance 1 S.à.r.l., Nabors Lux 2 S.à.r.l., Nabors Drilling Technologies USA, Inc., Nabors Drilling Holdings Inc. and Nabors Yellow Reef Ltd.

 

(d)           The Guarantor’s authorized share capital is as set forth in the Disclosure Package and the Final Offering Memorandum, and all of the issued shares of the Guarantor conform to the description thereof contained in the Disclosure Package and the Final Offering Memorandum and have been duly and validly authorized and issued and are fully paid and non-assessable; the Common Shares initially issuable upon exchange of the Notes have been duly authorized and, when issued upon exchange of the Notes, will be validly issued, fully paid and non-assessable; the Board of Directors (or a duly authorized committee thereof) of the Guarantor has duly and validly adopted resolutions reserving the Common Shares issuable upon exchange of the Notes; the holders of outstanding shares of each of the Company and the Guarantor are not entitled to preemptive or other rights to subscribe for the Securities or Common Shares issuable upon exchange thereof; and, except as set forth in the Disclosure Package and the Final Offering Memorandum, no options, warrants or other rights to purchase, agreements or other obligations to issue, or rights to convert any obligations into or exchange any securities for, shares of capital stock of or ownership interest in the Company or the Guarantor are outstanding.

 

(e)           The Common Shares issuable upon exchange of the Notes will be approved for listing prior to the Closing Date, subject to official notice of issuance and evidence of satisfactory distribution, on the New York Stock Exchange.

 

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(f)            This Agreement has been duly authorized, executed and delivered by the Company and the Guarantor.

 

(g)           The issuance of the Securities has been duly authorized and, when the Notes have been executed and authenticated in accordance with the provisions of the Indenture and delivered to and paid for by the Initial Purchasers in accordance with the terms of this Agreement, the Securities will be valid and binding obligations of the Company and the Guarantor, as the case may be, enforceable in accordance with their respective terms, subject to applicable bankruptcy, insolvency, moratorium, fraudulent conveyance or similar laws affecting creditors’ rights generally, general principles of equity and implied covenants of good faith and fair dealing, and will be entitled to the benefits of the Indenture.

 

(h)           The Indenture has been duly authorized and, on or prior to the Closing Date will have been, executed and delivered by, and, assuming due authorization, execution and delivery of the Indenture by the Trustee and the Securities Administrator, will be a valid and binding agreement of, the Company and the Guarantor, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency or similar laws affecting creditors’ rights generally and general principles of equity and implied covenants of good faith and fair dealing and except as rights to indemnification and contribution may be limited under applicable law.

 

(i)            The execution and delivery by the Company and the Guarantor of, and the performance by the Company and the Guarantor of their respective obligations under, this Agreement, the Indenture and the Securities, including the issuance of the Common Shares upon exchange of the Notes, (the “Transaction Documents”) will not contravene any provision of (i) the restated certificate of incorporation, as amended, or by-laws, as amended, of the Company or the Memorandum of Association or Bye-laws, as amended, of the Guarantor or (ii) any agreement or other instrument binding upon the Guarantor, the Company or any of the Significant Subsidiaries that is material to the Guarantor and its subsidiaries, taken as a whole, or, (iii) any judgment, order, applicable law or decree of any governmental body, agency or court having jurisdiction over the Guarantor, the Company or any Significant Subsidiary, except, in the cases of clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate, have a Material Adverse Effect.

 

(j)            Assuming compliance by the Initial Purchasers with this Agreement, no consent, approval, authorization or order of, or filing or qualification with, any governmental body or agency is required for the execution, delivery and performance by the Company and the Guarantor of their obligations under the Transaction Documents, including the issuance of the Common Shares upon exchange of the Notes, except such as may be required by the securities or Blue Sky laws of the various states in connection with the purchase and resale of the Securities by the Initial Purchasers and the listing of the Common Shares on the New York Stock Exchange.

 

(k)           There are no material legal or governmental proceedings pending or, to the knowledge of the Guarantor or the Company, threatened to which the Company or any of

 

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the Significant Subsidiaries is a party or to which any of the properties of the Guarantor or the Company or any of their subsidiaries is subject other than proceedings accurately described in all material respects in the Offering Memorandum and proceedings that would not have a Material Adverse Effect or material adverse effect on the power or ability of the Guarantor or the Company to perform its obligations under the Transaction Documents, including the issuance of the Common Shares upon exchange of the Notes, or to consummate the transactions contemplated by the Offering Memorandum.

 

(l)            With respect to the common share options (the “Common Share Options”) granted pursuant to the common share-based compensation plans of the Guarantor and its subsidiaries (the “Guarantor Common Share Plans”), (i) each grant of a Common Share Option was duly authorized no later than the date on which the grant of such Common Share Option was by its terms to be effective by all necessary corporate action, including, as applicable, approval by the board of directors of the Guarantor (or a duly constituted and authorized committee thereof) and any required shareholder approval by the necessary number of votes or written consents, and the award agreement governing such grant (if any) was duly executed and delivered by each party thereto, and (ii) each such grant was made in all material respects in accordance with the terms of the Guarantor Common Share Plans, the Securities Act, the Exchange Act and all other applicable laws and regulatory rules or requirements. The Guarantor has not knowingly granted, and there is no and has been no policy or practice of the Guarantor of granting, Common Share Options prior to, or otherwise coordinating the grant of Common Share Options with, the release or other public announcement of material information regarding the Guarantor or its subsidiaries or their results of operations or prospects.

 

(m)          Except as described in the Offering Memorandum, the Company, the Guarantor and the Significant Subsidiaries (i) are in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”), (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses as described in the Memorandum and (iii) are in compliance with all terms and conditions of any such permit, license or approval, except in the case of clause (i), (ii) and (iii), where such noncompliance would not, singly or in the aggregate, have a Material Adverse Effect.

 

(n)           Except as described in the Offering Memorandum, there are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties) which would, singly or in the aggregate, have a Material Adverse Effect.

 

(o)           Neither the Company, the Guarantor or any of the Significant Subsidiaries, nor any of their respective directors or officers, nor, to the Company’s or the Guarantor’s knowledge, any agent or employee acting at the direction of the Company, the Guarantor or any Significant Subsidiary, has taken any action in furtherance of an offer, payment,

 

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promise to pay, or authorization or approval of the payment or giving of money, property, gifts or anything else of value, directly or indirectly, to any “government official” (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) to influence official action or secure an improper advantage in material violation of applicable anti-corruption laws; and the Company, the Guarantor and the Significant Subsidiaries have conducted their businesses in compliance with applicable anti-corruption laws and have instituted and maintain and will continue to maintain policies and procedures designed to promote and achieve compliance with such laws and with the representation and warranty contained herein.

 

(p)           The operations of the Company, the Guarantor and the Significant Subsidiaries are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the Company, the Guarantor and the Significant Subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company, the Guarantor or any Significant Subsidiary with respect to the Anti-Money Laundering Laws is pending or, to the best knowledge of the Company and the Guarantor, threatened.

 

(q)           (i) Neither the Company, the Guarantor nor any of the Significant Subsidiaries, nor any of their respective directors or officer, nor, to the Company’s and the Guarantor’s knowledge, any agent, affiliate or employee  of the Company, the Guarantor or any of the Significant Subsidiaries, is an individual or entity (“Person”) that is, or is owned or controlled by a Person that is:

 

(A)  the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control (“OFAC”), the United Nations Security Council (“UNSC”), the European Union (“EU”), Her Majesty’s Treasury (“HMT”), or other relevant sanctions authority with jurisdiction over the Company, the Guarantor or any of the Significant Subsidiaries (collectively, “Sanctions”), nor

 

(B)  domiciled, organized or ordinarily resident in a country or territory that is the subject of comprehensive Sanctions (including, as of the date hereof, Cuba, Iran, North Korea, Sudan and Syria)

 

(ii)  The Company will not, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person:

 

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(A)  to fund or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions (except to the extent permissible under applicable Sanctions); or

 

(B)  in any other manner that will result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as underwriter, advisor, investor or otherwise).

 

(iii)  For the past five years, the Company, the Guarantor and the Significant Subsidiaries have not knowingly engaged in, are not now knowingly engaged in, and will not engage in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions, in each case, in a manner that would constitute a violation of applicable Sanctions.

 

(r)            The Company, the Guarantor and each of the Significant Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (v) the interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Offering Memorandum is accurate. Except as described in the Offering Memorandum, since the end of the Company’s and the Guarantor’s most recent audited fiscal year, there has been (i) no material weakness in the Company’s or the Guarantor’s internal control over financial reporting (whether or not remediated) and (ii) no change in the Company’s or the Guarantor’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s or the Guarantor’s internal control over financial reporting.

 

(s)            None of the Company, the Guarantor nor any affiliate (as defined in Rule 501(b) of Regulation D under the Securities Act, an “Affiliate”) of the Company or the Guarantor has directly, or through any agent, (i) sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any security (as defined in the Securities Act) which is or will be integrated with the sale of the Securities in a manner that would require the registration under the Securities Act of the Securities or the Common Shares issuable upon exchange of the Notes or (ii) engaged in any form of general solicitation or general advertising in connection with the offering of the Securities (as those terms are used in Regulation D under the Securities Act) or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act.

 

(t)            Assuming the accuracy of the representations and warranties of the Initial Purchasers in Section 7 and their compliance with the agreements set forth therein, it is

 

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not necessary in connection with the offer, sale and delivery of the Securities to the Initial Purchasers in the manner contemplated by this Agreement to register the Securities  or the Common Shares issuable upon exchange of the Notes under the Securities Act or to qualify the Indenture under the Trust Indenture Act of 1939, as amended.

 

(u)           The Securities satisfy the requirements set forth in Rule 144A(d)(3) under the Securities Act.

 

(v)           Neither the Company nor the Guarantor is, and after giving effect to the offering and sale of the Notes and the application of the proceeds thereof as described in the Disclosure Package and the Final Offering Memorandum neither will be, an “investment company” as defined in the Investment Company Act of 1940.

 

(w)          Other than (i) the Offering Memorandum, the Disclosure Package and the Final Offering Memorandum and (ii) any electronic road show or other written communications authorized for use pursuant to Section 6(j), neither the Company nor the Guarantor (including their respective agents and representatives, other than the Initial Purchasers in their capacity as such) has made, used or prepared, authorized, approved or referred to nor will they prepare, make, use, authorize, approve or refer to any written communication that constitutes an offer to sell or solicitation of an offer to buy the Securities without the prior written consent of the Initial Purchasers. Each such communication by the Company, the Guarantor or their agents and representatives pursuant to clause (ii) of the preceding sentence (each, an “Additional Written Communication”), when taken together with the Disclosure Package and the Final Offering Memorandum, as applicable, did not as of the Applicable Time, and at the Closing Date and each Option Closing Date (as defined herein) will not, include any untrue statement of a material fact or omit to state a material fact necessary to make the statements, in the light of the circumstances under which they were made, not misleading; except that this representation and warranty does not apply to statements in or omissions from each such Additional Written Communication based upon information relating to the Initial Purchasers furnished to the Company in writing by the Initial Purchasers through the Representatives expressly for use therein, it being understood and agreed that the only such information is that described in Section 8(b).

 

(x)           Any required United States federal income tax returns of the Guarantor and its subsidiaries required by law to be filed have been filed and all taxes shown by such returns or otherwise assessed, which are due and payable, have been paid, except assessments against which appeals have been or will be promptly taken and as to which adequate reserves have been provided.  The Guarantor and its subsidiaries have filed all other tax returns that are required to have been filed by them pursuant to applicable foreign, state, local or other law except insofar as the failure to file such returns would not result in a Material Adverse Effect, and have paid all taxes shown on such returns or pursuant to any assessment received by the Guarantor and its subsidiaries, except for such taxes, if any, as are being contested in good faith and as to which adequate reserves have been established by the Guarantor.  The Guarantor has maintained the charges, accruals and reserves on the books of the Guarantor in respect of any income and corporation tax

 

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liability in accordance with accounting principles generally accepted in the United States of America, except to the extent that would not result in a Material Adverse Effect.

 

(y)           The Company was not a “passive foreign investment company” (“PFIC”) as defined in Section 1297 of the United States Internal Revenue Code of 1986, as amended, for its most recently completed taxable year and is not expected to be a PFIC for any taxable year subsequent to such year.

 

2.     Agreements to Sell and Purchase

 

The Company hereby agrees to sell to the Initial Purchasers, and the Initial Purchasers, upon the basis of the representations and warranties herein contained, but subject to the conditions hereinafter stated, agree, severally and not jointly, to purchase from the Company the principal amount of the Purchased Notes set forth opposite such Initial Purchaser’s name on Schedule A hereto at the purchase price set forth on Schedule II hereto, payable on the Closing Date (the “Purchase Price”).

 

Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth, the Company and the Guarantor hereby grant an option to the several Option Purchasers to purchase, severally and not jointly, the Option Notes at the same purchase price set forth in Schedule II hereto (plus accrued interest, if any) for the Purchased Notes. Said option may be exercised only to cover overallotments in the sale of the Purchased Notes by the Option Purchasers. Said option may be exercised in whole or in part at any time on or before the 30th day after the date of the Final Offering Memorandum upon written or electronic notice by the Representatives to the Company and the Guarantor setting forth the aggregate principal amount of the Option Notes as to which the several Option Purchasers are exercising the option and the settlement date (each such date, an “Option Closing Date”), which shall not be later than five business days after the date of such notice; provided that such option cannot be exercised unless the Option Notes will be fungible with the Purchased Notes for purposes of U.S. federal income tax laws. The aggregate principal amount of Option Notes to be purchased by each Option Purchaser shall be the percentage of the total aggregate principal amount of the Option Notes set forth opposite their names in Schedule B hereto, subject to such adjustments as the Representatives in its absolute discretion shall make to ensure that the Option Notes are not issued in minimum denominations of less than $1,000 and integral multiples of $1,000 in excess thereof.

 

The Company and the Guarantor hereby agree that, without the prior written consent of the Initial Purchasers, they will not, during the period beginning on the date hereof and continuing to and including the Closing Date, offer, sell, contract to sell or otherwise dispose of any debt of the Company or warrants to purchase debt of the Company in each case of a type substantially similar to the Securities (other than the sale of the Securities under this Agreement, including the Option Notes).

 

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3.     Terms of Offering

 

You have advised the Company and the Guarantor that the Initial Purchasers will make an offering of the Securities to be purchased by the Initial Purchasers hereunder on the terms set forth in this Agreement and the Offering Memorandum.

 

4.     Payment and Delivery

 

Payment of the Purchase Price for the Purchased Notes and the Option Notes (if the option provided for in Section 2 hereof shall have been exercised on or before the third business day immediately preceding the Closing Date) shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Notes for the account of the Initial Purchasers and Option Purchasers, as applicable, at 10:00 A.M., New York City time, on January 13, 2017, or at such other time on the same or such other date, as shall hereafter be agreed upon by the Company and the Initial Purchasers and the Option Purchasers, as applicable.  The time and date of such payment are hereinafter referred to as the “Closing Date.”

 

Delivery of the Notes shall be made through the facilities of The Depository Trust Company (“DTC”) pursuant to its Full-Fast Delivery Program unless the Initial Purchasers shall otherwise instruct, and Notes sold by the Initial Purchasers in reliance on Rule 144A shall be represented by one or more global certificates.

 

If the option provided for in Section 2 hereof is exercised after the third business day immediately preceding the Closing Date, the Company will deliver the Option Notes (at the expense of the Company) to the Representatives, at 388 Greenwich Street, New York, New York, 10013 and 200 West Street, New York, New York 10282-2198, on the applicable Option Closing Date specified by the Representatives (which shall be within five business days after exercise of said option) for the respective accounts of the several Option Purchasers, against payment by the several Option Purchasers through the Representatives of the purchase price thereof to or upon the order of the Company by wire transfer payable in same-day funds to an account specified by the Company. If settlement for the Option Notes occurs after the Closing Date, the Company will deliver to the Representatives on each Option Closing Date, and the obligation of the Option Purchasers to purchase the Option Notes shall be conditioned upon compliance with Section 5 hereof.

 

5.     Conditions to the Initial Purchasers’ Obligations

 

The obligations of the several Initial Purchasers and Option Purchasers, as applicable, to purchase and pay for the Notes and related Guarantees on any Closing Date and each Option Closing Date are subject to the following conditions:

 

(a)           Subsequent to the execution and delivery of this Agreement and prior to the Closing Date and each Option Closing Date:

 

(i)                    There shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading, below Ba2(Negative) from Moody’s Investors Service, Inc., BBB-(Negative) from Standard and Poor’s Ratings Services, a division of the McGraw-Hill Companies, Inc. and BBB (Negative) from Fitch Inc., in the senior unsecured rating accorded the Company or the Guarantor or any of the

 

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Company’s or the Guarantor’s senior unsecured securities or in the rating outlook for the Company or the Guarantor by any “nationally recognized statistical rating organization,” as that term is defined in Section 3(a)(62) of the Exchange Act; and

 

(ii)                   There shall not have occurred any change, or any development involving a prospective change, in the financial position, or in the earnings, business or operations of the Guarantor and its subsidiaries, taken as a whole, from that set forth in the Offering Memorandum (exclusive of any amendments or supplements thereto subsequent to the date of this Agreement) that, in your judgment, is material and adverse and that makes it, in your judgment, impracticable to market the Securities on the terms and in the manner contemplated in the Offering Memorandum.

 

(b)           The Initial Purchasers shall have received on the Closing Date and, if applicable, any Option Closing Date, a certificate, dated the Closing Date and, if applicable, any Option Closing Date, and signed by an executive officer of each of the Company, with respect to the Company, and the Guarantor, with respect to the Guarantor, to the effect set forth in Section 5(a) and to the effect that the representations and warranties of the Company and the Guarantor contained in this Agreement are true and correct as of the Closing Date and, if applicable, such Option Closing Date, and that each of the Company and the Guarantor has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date and, if applicable, such Option Closing Date.

 

The officer signing and delivering such certificate may rely upon the best of his or her knowledge as to proceedings threatened.

 

(c)           The Company and the Guarantor shall have furnished to the Initial Purchasers the opinion of Julia Wright, Vice President and General Counsel of the Company, dated the Closing Date and, if applicable, any Option Closing Date, substantially to the effect set forth on Annex 5(c) hereto.  In giving such opinion, such counsel may rely as to matters of fact, to the extent such counsel deems proper, on certificates of responsible officers of the Company or the Guarantor and the Significant Subsidiaries and of public officials.  Such opinion may be relied upon only by the Initial Purchasers in connection with the transactions contemplated by this Agreement, and may not be used or relied upon by the Initial Purchasers for any other purpose, or by any other person, firm, corporation or entity for any purpose whatsoever, without the prior written consent of such counsel.  Such opinion may be limited to the laws of the State of Texas and the corporation, limited partnership and limited liability company statutes of the State of Delaware.

 

(d)           The Company and the Guarantor shall have furnished to the Initial Purchasers the opinion of Milbank, Tweed, Hadley & McCloy LLP (“MTHM”), special United States counsel for the Company and the Guarantor, dated the Closing Date and, if applicable, any Option Closing Date, substantially to the effect set forth on Annex 5(d)-1 hereto.

 

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In rendering their opinions pursuant to this Section 5(d), such counsel may rely, to the extent deemed advisable by such counsel, (i) as to factual matters on certificates of officers of the Company or the Guarantor and (ii) upon certificates of public officials.

 

Such opinion shall be limited to the laws of the State of New York, the Federal laws of the United States and the General Corporation Law of the State of Delaware. In addition, the Company shall have furnished to the Initial Purchasers the negative assurance letter of MTHM dated the Closing Date and, if applicable, any Option Closing Date, substantially to the effect set forth on Annex 5(d)-2.  Such opinion and negative assurance letter shall be rendered as of the Closing Date and, if applicable, any Option Closing Date,  only in connection with this Agreement and will be solely for the benefit of the Initial Purchasers, and may not be relied upon, nor shown to or quoted from, for any other purpose, or to any other person, firm or corporation.

 

(e)           The Company and the Guarantor shall have furnished to the Initial Purchasers the opinion of Conyers Dill & Pearman Limited, special counsel for the Guarantor, dated the Closing Date and, if applicable, any Option Closing Date,  in the form set forth on Annex 5(e) hereto.  Such opinion shall be limited to the laws of Bermuda.  Such opinion shall be rendered as of the Closing Date and, if applicable, any Option Closing Date, only in connection with the Agreement and will be solely for the benefit of the Initial Purchasers, and may not be relied upon, nor shown to or quoted from, for any other purpose, or to any other person, firm or corporation.

 

(f)            The Initial Purchasers shall have received from Vinson & Elkins L.L.P. and Latham and Watkins LLP, counsel for the Initial Purchasers, such opinion or opinions, dated the Closing Date and, if applicable, any Option Closing Date, with respect to the issuance and sale of the Securities, the Disclosure Package, the Final Offering Memorandum and other related matters as the Initial Purchasers may reasonably require, and the Company and the Guarantor shall have furnished to such counsel such documents as such counsel reasonably requests for the purpose of enabling such counsel to pass upon such matters.

 

(g)           The Initial Purchasers shall have received on the date of the Applicable Time and on the Closing Date and, if applicable, any Option Closing Date, letters, dated the date of the Applicable Time and Closing Date and, if applicable, any Option Closing Date, respectively, in form and substance satisfactory to the Initial Purchasers, from PricewaterhouseCoopers LLP, independent public accountants, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in or incorporated by reference into each Memorandum; provided that the letter delivered on the Closing Date and, if applicable, any Option Closing Date, shall use a “cut-off date” not earlier than three days from the date hereof.

 

(h)           The Common Shares issuable upon exchange of the Notes shall have been approved for listing on the New York Stock Exchange, subject to official notice of issuance, and satisfactory evidence of such actions shall have been provided to the Representatives.

 

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6.     Covenants of the Company and the Guarantor

 

In further consideration of the agreements of the Initial Purchasers contained in this Agreement, the Company and the Guarantor, jointly and severally, covenant with the Initial Purchasers as follows:

 

(a)           To furnish to the Initial Purchasers in New York City, without charge, prior to 10:00 A.M. New York City time on January 13, 2017 and during the period mentioned in Section 6(c), as many copies of the Disclosure Package, the Memorandum, any documents incorporated by reference therein and any supplements and amendments thereto as the Initial Purchasers may reasonably request.

 

(b)           Before amending or supplementing the Disclosure Package or the Memorandum, to furnish to the Initial Purchasers a copy of each such proposed amendment or supplement and not to use any such proposed amendment or supplement to which the Initial Purchasers reasonably object.

 

(c)           If, during such period after the date hereof and prior to the date on which all of the Securities (including the Option Notes) shall have been sold by the Initial Purchasers, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Disclosure Package or the Memorandum in order to make the statements therein, in the light of the circumstances when the Disclosure Package or the Memorandum is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Initial Purchasers, it is necessary to amend or supplement the Disclosure Package or the Memorandum to comply with applicable law, forthwith to prepare and furnish, at its own expense, to the Initial Purchasers, either amendments or supplements to the Disclosure Package or the Memorandum so that the statements in the Disclosure Package or the Memorandum as so amended or supplemented will not, in the light of the circumstances when the Disclosure Package or the Memorandum is delivered to a purchaser, be misleading or so that the Disclosure Package or the Memorandum, as amended or supplemented, will comply with applicable law.

 

(d)           To endeavor to qualify the Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Initial Purchasers shall reasonably request; provided, however that neither the Company nor the Guarantor shall be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.

 

(e)           The Company and the Guarantor will not, without the prior written consent of Citigroup Global Markets Inc. and Goldman, Sachs & Co. offer, sell, contract to sell, pledge, or otherwise dispose of (or enter into any transaction which is designed to, or might reasonably be expected to, result in the disposition (whether by actual disposition or effective economic disposition due to cash settlement or otherwise) by the Company, the Guarantor or any affiliate of the Company or the Guarantor), directly or indirectly, including the filing (or participation in the filing) of a registration statement

 

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with the Commission in respect of, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning of Section 16 of the Exchange Act, any Common Shares or any securities convertible into, or exercisable, or exchangeable for, Common Shares; or publicly announce an intention to effect any such transaction, until 60 days after the Applicable Time, provided, however, that (i) the Guarantor may issue and sell Common Shares pursuant to any employee stock option plan, stock ownership plan or dividend reinvestment plan of the Guarantor in effect at the Applicable Time; (ii) the Guarantor may issue Common Shares issuable upon the conversion of securities or the exercise of warrants or options outstanding at the Applicable Time and file a registration statement under the Securities Act related thereto; (iii) the Guarantor may issue Common Shares as consideration in an acquisition of the stock or assets of another entity or any contract or offer to enter into a contract therefore and file a registration statement with the Commission related thereto; (iv) the Guarantor may enter into an agreement providing for the issuance of Common Shares or any security or convertible into or exercisable for Common Shares in connection with joint ventures, commercial relationships or other strategic transactions, and may issue such securities pursuant to any such agreement and file a registration statement with the Commission related thereto; (v) the Guarantor or any affiliate of the Guarantor may engage in an intercompany transfer of existing Common Shares; and (vi) the Guarantor may issue Common Shares in connection with any exchange of the Notes; provided, however, that any Common Shares issued pursuant to clauses (iii) and (iv) above will not exceed 25% of the Guarantor’s issued and outstanding share capital on the date of the Offering Memorandum and will be subject to a lockup agreement for a period of time equal to the time remaining under the Company and Guarantor lockup described above.

 

(f)            The Guarantor will reserve and/or keep available at all times, free of preemptive rights, the full number of Common Shares issuable upon exchange of the Notes. The Guarantor will use all reasonable best efforts to maintain the listing of the Common Shares issuable upon exchange of the Notes on the New York Stock Exchange for so long as any Notes are outstanding.

 

(g)           Between the date hereof and the Closing Date, the Company and the Guarantor will not do or authorize any act or thing that would result in an adjustment of the exchange rate set forth in the Final Offering Memorandum.

 

(h)           Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, to pay or cause to be paid all expenses incident to the performance of their respective obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Company’s and the Guarantor’s counsel and the Company’s and the Guarantor’s accountants in connection with the issuance and sale of the Securities and all other fees or expenses of the Company and the Guarantor in connection with the preparation of the Disclosure Package and the Memorandum and all amendments and supplements thereto, including all printing costs associated therewith, and the delivery of copies thereof to the Initial Purchasers, in the quantities herein above specified, (ii) all costs and expenses related to the issuance, transfer and delivery of the Securities to the Initial Purchasers, including any transfer or other taxes payable thereon, and the issuance of the Common Shares upon exchange of

 

14

 

the Notes, (iii) the cost of printing or producing any blue sky or legal investment memorandum in connection with the offer and sale of the Securities under state securities laws and all expenses in connection with the qualification of the Securities for offer and sale under state securities laws as provided in Section 6(d) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Initial Purchasers in connection with such qualification and in connection with the Blue Sky or legal investment memorandum, (iv) any fees charged by rating agencies for the rating of the Securities, (v) the costs and charges of the Trustee and any transfer agent, exchange agent registrar, depositary, or the Securities Administrator, (vi) the costs and expenses of the Company and the Guarantor relating to investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Securities, including, without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company or the Guarantor, travel and lodging expenses of the representatives and officers of the Company and the Guarantor and any such consultants, and the cost of any aircraft chartered in connection with the road show, (vii) the costs and expenses relating to the listing of the Common Shares on the New York Stock Exchange and (viii) all other costs and expenses incident to the performance of the obligations of the Company and the Guarantor hereunder for which provision is not otherwise made in this Section.  It is understood, however, that except as provided elsewhere in this Agreement, the Initial Purchasers will pay all of their costs and expenses, including fees and disbursements of their counsel, including structuring counsel, transfer taxes payable upon their resale of any of the Securities by them and any advertising expenses connected with any offers they may make.

 

(i)            Neither the Guarantor nor any Affiliate of the Guarantor will sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in the Securities Act) which could be integrated with the sale of the Securities in a manner that would require the registration under the Securities Act of the Securities or the Common Shares issuable upon exchange of the Notes.

 

(j)            Not to solicit any offer to buy or offer or sell the Securities by means of any form of general solicitation or general advertising (as those terms are used in Regulation D under the Securities Act) or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act.

 

(k)           While any of the Securities or Common Shares issuable upon exchange of the Notes remain “restricted securities” within the meaning of Rule 144(c)(3), to make available, upon request, to any seller of such Securities the information specified in Rule 144A(d)(4) under the Securities Act, unless the Guarantor is then subject to Section 13 or 15(d) of the Exchange Act.

 

(l)            Before using, authorizing, approving or referring to any written communication that constitutes an offer to sell or a solicitation to buy the Notes or the Guarantees (other than the Disclosure Package and the Final Offering Memorandum), the Company will furnish to the Initial Purchasers a copy of such written communication for

 

15

 

review and will not use, authorize, approve or refer to any such written communication to which the Initial Purchasers reasonably object.

 

7.     Offering of Securities; Restrictions on Transfer

 

(a)  Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that (i) it is a qualified institutional buyer as defined in Rule 144A under the Securities Act (a “QIB”), and an “accredited investor” within the meaning of Rule 501 under the Securities Act, (ii) it has not solicited offers for, or offered or sold, and will not solicit offers for, or offer or sell, such Securities by any form of general solicitation or general advertising (as those terms are used in Regulation D under the Securities Act) or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act and (iii) it will solicit offers for such Securities only from, and will offer such Securities only to, persons that it reasonably believes to be QIBs in transactions pursuant to Rule 144A and in connection with each such sale, it has taken or will take reasonable steps to ensure that such sale is being made in reliance on Rule 144A.  Each Initial Purchaser will comply with all applicable laws and regulations in each jurisdiction in which it acquires, offers, sells or delivers Securities or has in its possession or distributes the Disclosure Package or the Memorandum or any such other material, in all cases at its own expense, except as provided in Section 6(e).

 

(b)           Each Initial Purchaser acknowledges and agrees that the Company and, for the purposes of the opinions to be delivered to the Initial Purchasers pursuant to Sections 5(c), 5(d), 5(e) and 5(f), counsel for the Company, counsel for the Guarantor and counsel for the Initial Purchasers, respectively, may rely upon the accuracy of the representations and warranties of such Initial Purchaser, and compliance of such Initial Purchaser with its agreements, contained in paragraph 7(a) above, and such Initial Purchaser hereby consents to such reliance.

 

8.     Indemnity and Contribution

 

(a)  The Company and the Guarantor, jointly and severally, agree to indemnify and hold harmless each Initial Purchaser, its affiliates, the respective officers and directors of the Initial Purchasers, and each person, if any, who controls any Initial Purchaser within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act and each selling agent who is deemed to have participated or alleged to have participated in the distribution of the Securities from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in any Additional Written Communication, the Offering Memorandum, the Disclosure Package, the Final Offering Memorandum, or in any amendment or supplement thereto, or caused by any omission or alleged omission to state therein a material fact necessary to make the statements therein in the light of the circumstances under which they were made not misleading, except insofar as such losses, claims, damages or liabilities are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information furnished to the Company in writing by the Initial Purchasers through the Representatives expressly for use therein, it being understood and agreed that the only information furnished by any such Initial Purchaser consists of the information described in Section 8(b);

 

16

 

(b)           Each Initial Purchaser, severally and not jointly, agrees to indemnify and hold harmless the Company, its affiliates, its directors, its officers, the Guarantor, its directors, its officers and each other person, if any, 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 information relating to the Initial Purchasers furnished in writing by the Initial Purchasers through the Representatives to the Company expressly for use in any Additional Written Communication, the Offering Memorandum, the Disclosure Package or the Final Offering Memorandum or any amendments or supplements thereto, it being understood and agreed that the only information furnished by any such Initial Purchaser consists of the following information in the Offering Memorandum: (i) the names of the Initial Purchasers on the cover page and (ii) the tenth (first sentence only) and eleventh paragraphs under the caption “Plan of Distribution.”

 

(c)           In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 8(a) or 8(b), such person (the “indemnified party”) shall promptly notify the person against whom such indemnity may be sought (the “indemnifying party”) in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the fees and disbursements of such counsel related to such proceeding; but the omission so to promptly notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party provided that the party entitled to be so notified is not prejudiced by such delay to promptly notify.  In any such proceeding, any indemnified party 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 party unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party 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 the indemnifying party shall not, in respect of the legal expenses of any indemnified party 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 such indemnified parties and that all such fees and expenses shall be reimbursed as they are incurred.  Such firm shall be designated in writing by the Representatives, in the case of parties indemnified pursuant to Section 8(a), and by the Guarantor, in the case of parties indemnified pursuant to Section 8(b).  The indemnifying party 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, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for

 

17

 

any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement.  No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement (i) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding, and (ii) does not include an admission of fault, culpability or a culpable failure to act, by or on behalf of an indemnified party.

 

(d)           To the extent the indemnification provided for in Section 8(a) or 8(b) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party 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 Company or the Guarantor on the one hand and the Initial Purchasers on the other hand from the offering of the Notes or (ii) if the allocation provided by clause 8(d)(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 8(d)(i) above but also the relative fault of the Company or the Guarantor on the one hand and of the Initial Purchasers on the other hand 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 or the Guarantor on the one hand and the Initial Purchasers on the other hand in connection with the offering of the Notes shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Notes (before deducting expenses) received by the Company and the total discounts and commissions received by the Initial Purchasers, in each case as set forth in the Offering Memorandum or herein, bear to the aggregate offering price of the Notes.  The relative fault of the Company or the Guarantor on the one hand and of the Initial Purchasers on the other hand 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 and the Guarantor or by the Initial Purchasers, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

 

(e)           The Company, the Guarantor and the Initial Purchasers agree that it would not be just or equitable if contribution pursuant to this Section 8 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 Section 8(d).  The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in Section 8(d) shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim.  Notwithstanding the provisions of

 

18

 

this Section 8, no Initial Purchaser shall be required to contribute any amount in excess of the amount by which the total price at which the Notes resold by it in the initial placement of such Notes were offered to investors exceeds the amount of any damages that such Initial Purchaser has 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.  The remedies provided for in this Section 8 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity. The Initial Purchasers’ obligations to contribute pursuant to this Section 8(e) are several in proportion to the respective principal amount of Notes they have agreed to purchase hereunder and not joint.

 

(f)            The indemnity and contribution provisions contained in this Section 8 and the representations, warranties and other statements of the Company or the Guarantor contained in this Agreement 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 Initial Purchaser or any person controlling any Initial Purchaser or by or on behalf of the Company, its officers or directors, the Guarantor, its officers or directors or any other person controlling the Company or the Guarantor and (iii) acceptance of and payment for any of the Notes.

 

9.     Termination

 

This Agreement shall be subject to termination by notice given by the Initial Purchasers to the Company and the Guarantor, if (a) after the execution and delivery of this Agreement and prior to the Closing Date or, if applicable, any Option Closing Date (i) trading generally shall have been suspended or materially limited on or by, as the case may be, either the New York Stock Exchange or The NASDAQ Stock Market LLC, or settlement of trading shall have been materially disrupted, (ii) trading of any securities of the Guarantor, including the Common Shares, shall have been suspended on any exchange or in any over-the-counter market, (iii) a general moratorium on commercial banking activities in New York shall have been declared by either Federal or New York State authorities or (iv) there shall have occurred any outbreak or escalation of hostilities (including without limitation an act of terrorism) or any change in financial markets or any calamity or crisis that, in your judgment, is material and adverse to the financial markets generally and (b) in the case of any of the events specified in clauses 9(a)(i) through 9(a)(iv), such event, singly or together with any other such event, makes it, in your judgment, impracticable to market the Securities on the terms and in the manner contemplated by this Agreement and the Offering Memorandum.

 

10.  Default by an Initial Purchaser

 

If any one or more Initial Purchasers shall fail to purchase and pay for any of the Purchased Notes and, if applicable, one or more of the Option Purchasers shall fail to purchase and pay for any of the Option Notes, if any, agreed to be purchased by such Initial Purchaser or Option Purchaser, as applicable, hereunder and such failure to purchase shall constitute a default in the performance of its or their obligations under this Agreement, the remaining Initial

 

19

 

Purchasers or, in the case of the Option Notes, the remaining Option Purchasers, shall be obligated severally to take up and pay for (in the respective proportions that the principal amount of Notes set forth opposite their names in Schedule A hereto bears to the aggregate principal amount of Notes set forth opposite the names of all the remaining Initial Purchasers or, in the case of the Option Notes, the respective proportions that the percentage set forth opposite their names in Schedule B hereto bears to the aggregate percentage set forth opposite the names of all the remaining Option Purchasers) the Purchased Notes or the Option Notes, as applicable, that the defaulting Initial Purchaser or Initial Purchasers or Option Purchasers agreed but failed to purchase; provided, however, that in the event that the aggregate principal amount of Purchased Notes that the defaulting Initial Purchaser or Initial Purchasers agreed but failed to purchase shall exceed 10% of the aggregate principal amount of Notes set forth in Schedule A hereto or in the event that the aggregate principal amount of Option Notes that the defaulting Option Purchaser or Option Purchasers agreed but failed to purchase shall exceed 10% of such Option Notes sold with respect to such Option Closing Date, the remaining Initial Purchasers or Option Purchasers, as applicable, shall have the right to purchase all, but shall not be under any obligation to purchase any, of the Purchased Notes or, if applicable, the Option Notes, and if such nondefaulting Initial Purchasers or Option Purchasers, as applicable, do not purchase all the Purchased Notes or, if applicable, the Option Notes, this Agreement will terminate without liability to any nondefaulting Initial Purchaser or Option Purchaser or the Company.  In the event of a default by any Initial Purchaser or Option Purchaser as set forth in this Section 10, the Closing Date and, if applicable, any Option Closing Date shall be postponed for such period, not exceeding five business days, as the Initial Purchasers or Option Purchasers, as applicable, shall determine in order that the required changes in the Final Offering Memorandum or in any other documents or arrangements may be effected.  Nothing contained in this Agreement shall relieve any defaulting Initial Purchaser or Option Purchaser, as applicable, of its liability, if any, to the Company or any nondefaulting Initial Purchaser or Option Purchaser, as applicable, for damages occasioned by its default hereunder.

 

11.       Effectiveness; Expense Reimbursement

 

This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.

 

If this Agreement shall be terminated by the Initial Purchasers because of any failure or refusal on the part of the Company or the Guarantor to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Company or the Guarantor shall be unable to perform its obligations under this Agreement, the Company will reimburse the Initial Purchasers for all out-of-pocket expenses (including the fees and disbursements of their counsel up to a maximum of $100,000) reasonably incurred by the Initial Purchasers in connection with this Agreement or the offering contemplated hereunder.

 

12.       Notices

 

Notices given pursuant to this Agreement shall be in writing and shall be delivered (a) if to the Company, at 515 W. Greens Road, Suite 1200, Houston, Texas 77067, Attention: Chief Financial Officer, or (b) if to the Guarantor, Crown House, 4 Par-La-Ville Road, Hamilton, Second Floor, HM08, Bermuda, or (c) if to the Initial Purchasers, to Citigroup Global Markets

 

20

 

Inc., 388 Greenwich Street, New York, New York, 10013, Attention: General Counsel, facsimile number 1-646-291-1469 and Goldman, Sachs & Co., 200 West Street, New York, New York 10282-2198, Attention: Registration Department, or in any case to such other address as the person to be notified may have requested in writing.

 

13.       Successors

 

This Agreement is made solely for the benefit of the Initial Purchasers, the Company, the Guarantor, their respective directors and officers and other controlling persons referred to in Section 8 hereof, and their respective successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement.  The term “successors and assigns” as used in this Agreement shall not include a purchaser from the Initial Purchasers of any of the Securities in its status as such purchaser.

 

14.       Partial Unenforceability

 

If any section, paragraph or provision of this Agreement is for any reason determined to be invalid or unenforceable, such determination shall not affect the validity or enforceability of any other section, paragraph or provision hereof.

 

15.       Counterparts

 

This Agreement may be signed (including by facsimile) in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

 

16.       Applicable Law

 

This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York.

 

17.       No Fiduciary Duty

 

The Company and Guarantor hereby acknowledge that (a) the purchase and sale of the Securities pursuant to this Agreement is an arm’s-length commercial transaction between the Company and the Guarantor, on the one hand, and the Initial Purchasers and any affiliate through which they may be acting, on the other, (b) the Initial Purchasers are acting as principal and not as an agent or fiduciary of the Company or the Guarantor and (c) the Company’s engagement of the Initial Purchasers in connection with the offering and the process leading up to the offering 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 (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.

 

21

 

18.       Consent to Jurisdiction

 

Any legal suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York, Borough of Manhattan, or the courts of the State of New York in each case located in the City and County of New York, Borough of Manhattan  (collectively, the “Specified Courts”), and each party irrevocably submits to the exclusive jurisdiction (except for proceedings instituted in regard to the enforcement of a judgment of any such court (a “Related Judgment”), as to which such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding.  Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any suit, action or other proceeding brought in any such court.  The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such suit, action or other proceeding brought in any such court has been brought in an inconvenient forum.  Each party not located in the United States irrevocably appoints CT Corporation System as its agent to receive service of process or other legal summons for purposes of any such suit, action or proceeding that may be instituted in any state or federal court in the City and County of New York.

 

19.       Waiver of Immunity

 

With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any Related Judgment, each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment, including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

 

20.       Headings

 

The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement.

 

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Very   truly yours,
    
	
 
    	
 
    
	
 
    	
NABORS INDUSTRIES LTD.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Mark Andrews
    
	
 
    	
Name:
    	
Mark   D. Andrews
    
	
 
    	
Title:
    	
Corporate   Secretary
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
NABORS INDUSTRIES, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   William Restrepo
    
	
 
    	
Name:
    	
William   Restrepo
    
	
 
    	
Title:
    	
Chief   Financial Officer
    

 

Signature Page to Purchase Agreement

 

 

	
Accepted as of the date hereof:
    	
 
    
	
 
    	
 
    
	
CITIGROUP GLOBAL MARKETS INC.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Jason Howard
    	
 
    
	
Name:
    	
Jason   Howard
    	
 
    
	
Title:
    	
Director
    	
 
    
	
 
    	
 
    	
 
    
	
GOLDMAN, SACHS & CO.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Richard Cohn
    	
 
    
	
Name:
    	
Richard   Cohn
    	
 
    
	
Title:
    	
Managing   Director
    	
 
    

 

Signature Page to Purchase Agreement

 

 

SCHEDULE I

 

Pricing Supplement

 

Schedule I-1

 

Pricing Supplement dated January 9, 2017

 

This Pricing Supplement is qualified in its entirety by reference to the Preliminary Offering Memorandum dated January 9, 2017 (the “Preliminary Offering Memorandum”). The information in this Pricing Supplement supplements the Preliminary Offering Memorandum and supersedes the information in the Preliminary Offering Memorandum. Capitalized terms used but not defined herein have the meanings assigned to such terms in the Preliminary Offering Memorandum.

 

The Notes have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and are being offered only to qualified institutional buyers pursuant to Rule 144A under the Securities Act.

 

Terms Applicable to the 0.75% Exchangeable Senior Notes due 2024 (the “Notes”)

 

	
Security Offered:
    	
 
    	
0.75% Exchangeable Senior Notes due 2024. Unless the   context requires otherwise, as used in this Pricing Supplement, each Note refers   to a Note having a principal amount of $1,000.
    
	
 
    	
 
    	
 
    
	
Ticker/Exchange for   Common Shares of the Guarantor:
    	
 
    	
NBR / NYSE
    
	
 
    	
 
    	
 
    
	
Issuer:
    	
 
    	
Nabors Industries, Inc.
    
	
 
    	
 
    	
 
    
	
Guarantor:
    	
 
    	
Nabors Industries Ltd.
    
	
 
    	
 
    	
 
    
	
Principal Amount:
    	
 
    	
$500,000,000 aggregate principal amount of Notes
    
	
 
    	
 
    	
 
    
	
Gross Proceeds:
    	
 
    	
$500,000,000
    
	
 
    	
 
    	
 
    
	
Net Proceeds:
    	
 
    	
$488,118,000
    
	
 
    	
 
    	
 
    
	
Initial Purchasers’   Over-Allotment Option:
    	
 
    	
$75,000,000 aggregate principal amount of Notes
    
	
 
    	
 
    	
 
    
	
Maturity Date:
    	
 
    	
January 15, 2024, unless earlier exchanged,   redeemed or purchased
    
	
 
    	
 
    	
 
    
	
Offering Price to   Investors:
    	
 
    	
100.000% of the principal amount
    
	
 
    	
 
    	
 
    
	
Coupon:
    	
 
    	
0.75%
    
	
 
    	
 
    	
 
    
	
Yield to Maturity:
    	
 
    	
0.75%
    
	
 
    	
 
    	
 
    
	
Interest Payment Dates:
    	
 
    	
January 15 and July 15, beginning   July 15, 2017
    

 

Schedule I - 2

 

	
Regular Record Dates:
    	
 
    	
January 1 and July 1
    
	
 
    	
 
    	
 
    
	
NYSE Last Reported Sale   Price on January 9, 2017:
    	
 
    	
$17.97 per Common Share
    
	
 
    	
 
    	
 
    
	
Exchange Premium:
    	
 
    	
Approximately 40% above the NYSE Last Reported Sale   Price on January 9, 2017
    
	
 
    	
 
    	
 
    
	
Initial Exchange Price:
    	
 
    	
Approximately $25.16 per Common Share
    
	
 
    	
 
    	
 
    
	
Initial Exchange Rate:
    	
 
    	
39.7488 Common Shares per $1,000 principal amount of   Notes
    
	
 
    	
 
    	
 
    
	
Redemption at the   Issuer’s Option:
    	
 
    	
The Notes may not be redeemed at the Issuer’s   option, except in limited circumstances in connection with a change in tax   law, as described in the Preliminary Offering Memorandum. Notice of such a   redemption would be deemed to constitute a “make-whole fundamental change,”   which will in certain circumstances result in a temporary increased exchange   rate.
    
	
 
    	
 
    	
 
    
	
Joint Book-Runners:
    	
 
    	
Citigroup Global Markets Inc.
   Goldman, Sachs & Co.
   Mizuho Securities USA Inc.
   Merrill Lynch, Pierce, Fenner & Smith

Incorporated
    
	
 
    	
 
    	
 
    
	
Co-Managers:
    	
 
    	
Morgan Stanley & Co. LLC
   HSBC Securities (USA) Inc.
   MUFG Securities Americas Inc.
   Deutsche Bank Securities Inc.
   Wells Fargo Securities, LLC
   PNC Capital Markets LLC
   BBVA Securities Inc.
   SMBC Nikko Securities America, Inc.
   U.S. Bancorp Investments, Inc.
   Credit Suisse Securities (USA) LLC
   RBC Capital Markets, LLC
   Scotia Capital (USA) Inc.
   ANZ Securities, Inc.
    
	
 
    	
 
    	
 
    
	
Trade Date:
    	
 
    	
January 10, 2017
    
	
 
    	
 
    	
 
    
	
Settlement Date:
    	
 
    	
January 13, 2017 (T+3)
    
	
 
    	
 
    	
 
    
	
Denominations:
    	
 
    	
$1,000 and in integral multiples of $1,000 in excess   thereof
    

 

Schedule I - 3

 

	
CUSIP:
    	
 
    	
Rule 144A: 62957H AA3
    
	
 
    	
 
    	
 
    
	
ISIN:
    	
 
    	
Rule 144A: US62957HAA32
    
	
 
    	
 
    	
 
    
	
Capped Call   Transactions:
    	
 
    	
In connection with the pricing of the Notes, the   Issuer and the Guarantor expect to enter into capped call transactions with   one or more of the Initial Purchasers and/or any of their affiliates (the   “option counterparties”). The capped call transactions are intended to reduce   the dilutive impact of the exchange feature of the Notes on the Guarantor’s   issued and outstanding common shares and/or offset any cash payments the   Issuer will be required to make in excess of the principal amount, upon any   exchange of the Notes, with such reduction and/or offset subject to a cap. If   the Initial Purchasers exercise their overallotment option to purchase   additional Notes, the Issuer may enter into additional capped call   transactions.
    
   In connection with establishing their initial hedge of the capped call transactions,   the option counterparties and/or their affiliates expect to enter into   various derivative transactions with respect to the common shares   concurrently with or shortly after the pricing of the Notes. This activity   could increase (or reduce the size of any decrease in) the market price of   the common shares or the Notes at that time.
    
   In addition, the option counterparties and/or their affiliates may modify   their hedge positions by entering into or unwinding various derivatives with   respect to the common shares and/or purchasing or selling the common shares   in secondary market transactions following the pricing of the Notes and prior   to the maturity of the Notes (and are likely to do so during any exchange   period related to an exchange of Notes). This activity could also cause or   avoid an increase or a decrease in the market price of the common shares or   the Notes, which could affect holders ability to exchange the Notes and, to   the extent the activity occurs during any exchange period related to an exchange   of Notes, could affect the amount and value of the consideration that holders   will receive upon exchange of the Notes. See ‘‘Risk Factors—Risk Factors   Related to the Offering—The capped call transactions may affect the value of   the Notes and Nabors’ common shares in the Preliminary Offering Memorandum.
    

 

Schedule I - 4

 

	
Use of Proceeds:
    	
 
    	
The net proceeds of this offering, after deducting   commissions and estimated offering expenses payable by the Issuer, are   expected to be approximately $488.1 million (or $561.6 million if the Initial   Purchasers exercise their overallotment option in full). The Issuer intends   to use approximately $35.0 million of the net proceeds from this offering to   pay the cost of the capped call transactions it intends to enter into with   respect to the common shares. The Issuer intends to use approximately $162.5   million of the net proceeds to prepay the remaining balance of its $325.0   million unsecured term loan which matures in 2020. The Issuer intends to use   any remaining net proceeds from the offering for general corporate purposes,   including to repurchase or repay other indebtedness. See “Use of Proceeds” in   the Preliminary Offering Memorandum. To the extent that the Initial   Purchasers exercise their overallotment option, the Issuer will use a portion   of the proceeds from such issuance of additional Notes to pay the cost of any   related capped call transactions it enters into in connection with such exercise   of the overallotment option and will use remaining proceeds for general   corporate purposes, including to repurchase or repay other indebtedness.
    
	
 
    	
 
    	
 
    
	
Indebtedness:
    	
 
    	
As of September 30, 2016, the Guarantor had   total consolidated indebtedness of $3.48 billion, resulting in a gross debt   to capital ratio of 0.49:1 and a net debt to capital ratio of 0.48:1. As of   the same date, after giving effect to both the December 2016 Senior   Notes Offering and this offering and the use of proceeds therefrom, the Guarantor’s   total consolidated indebtedness would have been $3.90 billion, resulting in a   gross debt to capital ratio of 0.52:1 and a net debt to capital ratio of   0.48:1. The indenture governing the Notes will not limit the amount of debt   that the Issuer, the Guarantor or their respective subsidiaries may incur.
    
	
 
    	
 
    	
 
    
	
Fundamental Change   Purchase Right:
    	
 
    	
If fundamental change occurs (as defined in the   Preliminary Offering Memorandum under the caption “Description of the Notes—   Purchase at the Option of the Holder Upon a Fundamental Change”) prior to   maturity, holders will have the right, at such holder’s option, to require   the Issuer to purchase for cash some or all of such holders’ Notes at a   purchase price equal to 100% of the principal amount of the Notes being purchased,   plus accrued and unpaid interest to, but excluding, the fundamental change   purchase date.
    
	
 
    	
 
    	
 
    
	
Increase in Exchange   Rate in Connection with a Make-Whole Fundamental Change:
    	
 
    	
The following table sets forth, for each share price   and make-whole fundamental change effective date set forth below, the number   of additional shares by which the exchange rate will be increased in   connection with a make-whole fundamental change per $1,000 principal amount   of Notes:
    

 

Schedule I - 5

 

	
 
    	
 
    	
Share Price
    	
 
    
	
Effective Date
    	
 
    	
$17.97
    	
 
    	
$20.00
    	
 
    	
$22.50
    	
 
    	
$25.16
    	
 
    	
$27.50
    	
 
    	
$30.00
    	
 
    	
$35.00
    	
 
    	
$40.00
    	
 
    	
$50.00
    	
 
    	
$60.00
    	
 
    	
$75.00
    	
 
    
	
January 13, 2017
    	
 
    	
15.8995
    	
 
    	
13.1490
    	
 
    	
10.5413
    	
 
    	
8.4320
    	
 
    	
6.9825
    	
 
    	
5.7427
    	
 
    	
3.9326
    	
 
    	
2.7138
    	
 
    	
1.2746
    	
 
    	
0.5487
    	
 
    	
0.0900
    	
 
    
	
January 15, 2018
    	
 
    	
15.8995
    	
 
    	
13.1490
    	
 
    	
10.5413
    	
 
    	
8.4118
    	
 
    	
6.9153
    	
 
    	
5.6437
    	
 
    	
3.8057
    	
 
    	
2.5845
    	
 
    	
1.1704
    	
 
    	
0.4788
    	
 
    	
0.0647
    	
 
    
	
January 15, 2019
    	
 
    	
15.8995
    	
 
    	
13.1490
    	
 
    	
10.5413
    	
 
    	
8.3398
    	
 
    	
6.7927
    	
 
    	
5.4887
    	
 
    	
3.6266
    	
 
    	
2.4105
    	
 
    	
1.0372
    	
 
    	
0.3923
    	
 
    	
0.0360
    	
 
    
	
January 15, 2020
    	
 
    	
15.8995
    	
 
    	
13.1490
    	
 
    	
10.5329
    	
 
    	
8.1475
    	
 
    	
6.5502
    	
 
    	
5.2183
    	
 
    	
3.3483
    	
 
    	
2.1563
    	
 
    	
0.8578
    	
 
    	
0.2847
    	
 
    	
0.0100
    	
 
    
	
January 15, 2021
    	
 
    	
15.8995
    	
 
    	
13.1490
    	
 
    	
10.2156
    	
 
    	
7.7273
    	
 
    	
6.0876
    	
 
    	
4.7427
    	
 
    	
2.9031
    	
 
    	
1.7745
    	
 
    	
0.6158
    	
 
    	
0.1570
    	
 
    	
0.0000
    	
 
    
	
January 15, 2022
    	
 
    	
15.8995
    	
 
    	
12.9315
    	
 
    	
9.5058
    	
 
    	
6.9110
    	
 
    	
5.2491
    	
 
    	
3.9260
    	
 
    	
2.2029
    	
 
    	
1.2200
    	
 
    	
0.3182
    	
 
    	
0.0363
    	
 
    	
0.0000
    	
 
    
	
January 15, 2023
    	
 
    	
15.8995
    	
 
    	
11.8580
    	
 
    	
8.0587
    	
 
    	
5.3271
    	
 
    	
3.6982
    	
 
    	
2.5037
    	
 
    	
1.1389
    	
 
    	
0.4940
    	
 
    	
0.0494
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    
	
January 15, 2024
    	
 
    	
15.8995
    	
 
    	
10.2510
    	
 
    	
4.6956
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    	
0.0000
    	
 
    

 

The exact share price and make-whole fundamental change effective date may not be set forth on the table, in which case, if the share price is:

 

·                  between two share prices in the table or such make-whole fundamental change effective date is between two dates on the table, the number of make-whole shares added to the exchange rate of the notes will be determined by straight- line interpolation between the number of make-whole shares set forth for the higher and lower share price amounts and the two dates, as applicable, based on a 360-day year;

 

·                  in excess of $75.00 per share (subject to adjustment in the same manner and at the same time as the share prices in the table above), no make-whole shares will be added to the exchange rate of the notes;

 

·                  less than $17.97 per share (subject to adjustment in the same manner and at the same time as the share prices in the table above), no make-whole shares will be added to the exchange rate of the notes.

 

Notwithstanding the foregoing, in no event will the exchange rate for the notes exceed 55.6483 shares per $1,000 principal amount of the notes, subject to adjustments in the same manner as the exchange rate.

 

 

Note: A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time.

 

This communication is for informational purposes only and does not constitute an offer to sell, or a solicitation of an offer to buy any security.  No offer to buy securities described herein can be accepted, and no part of the purchase price thereof can be received, unless the person making such investment decision has received and reviewed the information contained in the relevant offering memorandum in making their investment decisions.  This communication is not intended to be a confirmation as required under Rule 10b-10 of the Securities Exchange Act of 1934.  A formal confirmation will be delivered to you separately.

 

None of the exchangeable senior notes, the guarantee or the common shares deliverable upon exchange of the notes, if any, have been registered under the Securities Act.  The notes may not be offered or sold within the United States or to U.S. persons except to qualified institutional buyers in reliance on the exemption from registration provided by Rule 144A.  You are hereby notified that sellers of the notes may be relying on the exemption from the provisions of Section 5 of the Securities Act provided by Rule 144A.  You may obtain a copy of the Preliminary Offering Memorandum and the Final Offering Memorandum (when available) for this transaction by calling your Citigroup Global Markets Inc. or Goldman, Sachs & Co. sales representative to request it.

 

Schedule I - 6

 

SCHEDULE II

 

Purchase Price: 97.90% of the aggregate principal amount of the Notes

 

Schedule II - 1

 

SCHEDULE A

 

	
Initial Purchasers
    	
 
    	
Principal Amount of
   Notes to be Purchased
    	
 
    
	
Citigroup Global   Markets Inc.
    	
 
    	
$
    	
148,381,000
    	
 
    
	
Goldman,   Sachs & Co.
    	
 
    	
$
    	
124,952,000
    	
 
    
	
Mizuho   Securities USA Inc.
    	
 
    	
$
    	
58,571,000
    	
 
    
	
Merrill Lynch, Pierce,   Fenner & Smith
   Incorporated
    	
 
    	
$
    	
58,571,000
    	
 
    
	
Morgan   Stanley & Co. LLC
    	
 
    	
$
    	
14,286,000
    	
 
    
	
HSBC Securities   (USA) Inc.
    	
 
    	
$
    	
14,286,000
    	
 
    
	
MUFG Securities   Americas Inc.
    	
 
    	
$
    	
14,286,000
    	
 
    
	
Deutsche Bank   Securities Inc.
    	
 
    	
$
    	
14,286,000
    	
 
    
	
Wells Fargo   Securities, LLC
    	
 
    	
$
    	
14,286,000
    	
 
    
	
PNC Capital   Markets LLC
    	
 
    	
$
    	
7,619,000
    	
 
    
	
BBVA Securities   Inc.
    	
 
    	
$
    	
4,762,000
    	
 
    
	
SMBC Nikko   Securities America, Inc.
    	
 
    	
$
    	
4,762,000
    	
 
    
	
U.S. Bancorp   Investments, Inc.
    	
 
    	
$
    	
4,762,000
    	
 
    
	
Credit Suisse   Securities (USA) LLC
    	
 
    	
$
    	
4,762,000
    	
 
    
	
RBC Capital   Markets, LLC
    	
 
    	
$
    	
4,762,000
    	
 
    
	
Scotia Capital   (USA) Inc.
    	
 
    	
$
    	
4,762,000
    	
 
    
	
ANZ   Securities, Inc.
    	
 
    	
$
    	
1,904,000
    	
 
    
	
Total
    	
 
    	
$
    	
500,000,000
    	
 
    

 

Schedule A - 1

 

SCHEDULE B

 

	
Initial Purchasers
    	
 
    	
Percentage of Option Notes
   to be Purchased
    	
 
    
	
Citigroup Global   Markets Inc.
    	
 
    	
38.0
    	
%
    
	
Goldman,   Sachs & Co.
    	
 
    	
32.0
    	
%
    
	
Mizuho   Securities USA Inc.
    	
 
    	
15.0
    	
%
    
	
Merrill Lynch, Pierce,   Fenner & Smith
   Incorporated
    	
 
    	
15.0
    	
%
    
	
Total
    	
 
    	
100.0
    	
%
    

 

Schedule B - 1

 

ANNEX 5(C)

 

OPINION OF JULIA WRIGHT

 

(i)                                     Each of the Company, Nabors International Finance Inc., Nabors Drilling Technologies USA, Inc. and Nabors Drilling Holdings Inc. (collectively, the “Selected Subsidiaries” and each a “Selected Subsidiary”), has been duly organized and is validly existing as a corporation or limited partnership in good standing under the laws of the jurisdiction in which it is chartered or organized, with full corporate or partnership power and authority to own its properties and conduct its business as described in each Memorandum, and is duly qualified to do business as a foreign corporation or limited partnership and is in good standing under the laws of each jurisdiction which requires such qualification wherein it owns or leases properties or conducts business, except to the extent that the failure to be so qualified or be in good standing would not have a material adverse effect on the Guarantor and its subsidiaries, taken as a whole;

 

(ii)                                  All outstanding shares of capital stock (or limited partnership interests) of each of the Company and the other Significant Subsidiaries are owned by the Guarantor either directly or through wholly owned subsidiaries free and clear of any perfected security interest, other than any perfected security interest in favor of the Guarantor or another Significant Subsidiary and, to the knowledge of such counsel, any other security interests, claims, liens or encumbrances other than any liens, encumbrances, equities or claims in favor of the Guarantor or another Significant Subsidiary;

 

(iii)                               To the knowledge of such counsel, there is no pending or threatened material action, suit or proceeding before any court or governmental agency, authority or body or any arbitrator involving the Guarantor or any of its subsidiaries of a character required to be disclosed in either Memorandum which is not disclosed in each such Memorandum; and

 

(iv)                              Neither the issue and sale of the Notes, the consummation of any other of the transactions contemplated by this Agreement or the Indenture nor the fulfillment of the terms thereof will conflict with, result in a breach or violation of, or constitute a default under the terms of (A) any indenture or other agreement or instrument known to such counsel and to which the Company, the Guarantor or any of the Significant Subsidiaries is a party or bound, or any judgment, order or decree known to such counsel to be applicable to the Company, the Guarantor or any of the Significant Subsidiaries of any court, regulatory body, administrative agency, governmental body or arbitrator having jurisdiction over the Company, the Guarantor or any of the Significant Subsidiaries, except such as would not, either singly or in the aggregate, have a material adverse effect upon the Guarantor and its subsidiaries, taken as a whole, or prevent the Company or the Guarantor from performing its obligations under this Agreement or the Indenture or (B) the respective charters, bylaws or other organizational documents of the Significant Subsidiaries (assuming that the relevant laws of the jurisdiction of organization of any Significant Subsidiary not organized in Texas or Delaware are the same as those of Texas).

 

Such counsel shall also state that it has no reason to believe that the Disclosure Package, as of the Applicable Time and at the Closing Date, or the Final Offering Memorandum, as of its date and at the Closing Date, contained or contains an untrue statement of a material fact or 

 

Annex 5(C) - 1

 

omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (it being understood that such counsel need not express an opinion or comment with respect to the financial statements and the other financial information contained or incorporated by reference therein or excluded therefrom).

 

Annex 5(C) - 2

 

ANNEX 5(D)-1

 

OPINION OF MILBANK, TWEED, HADLEY & McCLOY LLP

 

1.                                      The Company is validly existing as a corporation in good standing under the laws of the State of Delaware.

 

2.                                      The statements in the Offering Memorandum under “Description of the Notes” and “Transfer Restrictions” insofar as such statements purport to summarize certain provisions of the Notes, Guarantees and the Indenture referred to therein as of the date hereof, fairly summarize such provisions.

 

3.                                      The statements in the discussion of matters in connection with the United States Employee Retirement Income Security Act of 1974, as amended (“ERISA”), contained under the caption each Offering Memorandum titled “Certain Employee Benefit Plan Considerations for Investors” are, to the extent they concern matters of law or legal conclusions, correct in all material respects.

 

4.                                      Neither the offer, sale and delivery of the Notes and Guarantees by the Company and the Guarantor to the Initial Purchasers, the initial resale thereof by the Initial Purchasers in the manner contemplated in the Disclosure Package and the Final Offering Memorandum and by the Purchase Agreement require registration under the Securities Act of 1933, as amended (it being understood that we express no opinion in this paragraph as to any subsequent resale of any Securities), and the Indenture is not required to be qualified under the Trust Indenture Act of 1939, as amended.

 

5.                                      The Indenture has been duly authorized, executed and delivered by the Company, and, assuming it has been duly authorized, executed and delivered by each of the Guarantor, the Trustee and the Securities Administrator, the Indenture constitutes a legal, valid and binding agreement enforceable against the Company and the Guarantor in accordance with its terms (subject to the qualification that (a) enforceability of the obligations of the Company and the Guarantor thereunder may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or transfer, or similar laws relating to or affecting creditors’ rights generally; (b) the enforceability thereof is subject to the application of general principles of equity (regardless of whether considered in a proceeding in equity or at law), including (i) the possible unavailability of specific performance, injunctive relief or any other equitable remedy, (ii) concepts of materiality, reasonableness, good faith and fair dealing, and (iii) in the case of the Guarantor, possible judicial action giving effect to foreign governmental actions or foreign law; and (c) in the case of rights to indemnity and contribution, as may be limited by provisions imposed by law or public policy).

 

6.                                      The Notes have been duly authorized by the Company and, when executed and authenticated in accordance with the provisions of the Indenture and delivered to and paid for by the Initial Purchasers pursuant to the Purchase Agreement, will constitute legal, valid and binding obligations of the Company entitled to the benefits of the Indenture (subject to the qualification that (a) enforceability of the obligations of the Company thereunder may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or transfer or

 

Annex 5(D)-1 - 1

 

similar laws relating  to or affecting creditors’ rights generally; and (b) the enforceability thereof is subject to the application of general principles of equity (regardless of whether considered in a proceeding in equity or at law), including (i) the possible unavailability of specific performance, injunctive relief or any other equitable remedy and (ii) concepts of materiality, reasonableness, good faith and fair dealing); and assuming that the Guarantees have been duly authorized by the Guarantor and that the Guarantor has duly authorized, executed and delivered the Indenture, when the Notes have been executed and authenticated in accordance with the provisions of the Indenture and delivered to and paid for by the Initial Purchasers pursuant to the Purchase Agreement, the Guarantees will constitute legal, valid and binding obligations of the Guarantor entitled to the benefits of the Indenture (subject to the qualification that (a) enforceability of the obligations of the Guarantor thereunder may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or transfer or similar laws relating to or affecting creditors’ rights generally; and (b) the enforceability thereof is subject to the application of general principles of equity (regardless of whether considered in a proceeding in equity or at law), including (i) the possible unavailability of specific performance, injunctive relief or any other equitable remedy, (ii) concepts of materiality, reasonableness, good faith and fair dealing, and (iii) possible judicial action giving effect to foreign governmental actions or foreign law).

 

7.                                      The Purchase Agreement has been duly authorized, executed and delivered by the Company.

 

8.                                      No consent, approval, authorization or order of any Governmental Authority (as defined below) is required for the consummation of the transactions contemplated by the Purchase Agreement, except such as have been made or obtained prior to the date hereof, as may be required under state securities or “blue sky” laws of any jurisdiction, and by United States federal and state securities laws and the listing of the Common Shares on the New York Stock Exchange.

 

9.                                      Neither the issue and sale of the Securities by the Company and the Guarantor, nor the consummation of any of the other transactions contemplated in the Purchase Agreement, nor the fulfillment of the terms of the Purchase Agreement, results in a breach or violation of (a) Applicable Law (as defined below), except such as would not, either singly or in the aggregate, have a material adverse effect on the Guarantor and its subsidiaries, taken as a whole, or prevent either of the Company or the Guarantor from performing its obligations under the Purchase Agreement or the Indenture, or (b) the Restated Certificate of Incorporation or By-laws of the Company.

 

10.                               The statements in the each Offering Memorandum under the caption titled “Certain United States Federal Income Tax Considerations” to the extent they constitute statements of law or legal conclusions are, subject to the limitations, qualifications, exceptions, and assumptions set forth therein, correct in all material respects.

 

11.                               The Company is not required to, and, immediately after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in each Offering Memorandum, the Company will not be required to register as an investment company under the Investment Company Act of 1940, as amended.

 

Annex 5(D)-1 - 2

 

The foregoing opinions in paragraphs 3 and 10 above are limited to matters involving United States federal law, and we do not express any opinion as to the laws of any other jurisdiction.  The foregoing opinions in paragraphs 3 and 10 are based on the law in effect on the date hereof, including the United States Internal Revenue Code of 1986, as amended (the “Code”), ERISA, United States Treasury and Department of Labor regulations (including proposed regulations) promulgated under the Code and ERISA, respectively, the legislative history thereof, judicial decisions and administrative pronouncements, rulings of the United States Internal Revenue Service and opinions of the United States Department of Labor.  Such laws are subject to change, possibly with retroactive effect, and we undertake no obligation to update such opinions or otherwise advise you if any such laws should change.  Our opinion is not binding on the Internal Revenue Service, the Department of Labor or a court and, in particular due to the absence of authority addressing a closely comparable transaction, there can be no assurance that the Internal Revenue Service, the Department of Labor or a court will not adopt a position contrary to our opinion.

 

We express no opinion:  (a) as to whether a United States federal or state court outside the State of New York would give effect to the choice of New York law in the Indenture and the Securities; (b) as to whether the United States federal courts could exercise jurisdiction over any action brought against the Guarantor or the Company by any party not a “citizen” of any state for purposes of 28 U.S.C. §1331 and 28 U.S.C. §1332; (c) as to the enforceability of any provision to the extent such provision provides indemnity in respect of any loss sustained as the result of the conversion into United States dollars of a judgment or order rendered by a court or tribunal of any particular jurisdiction and expressed in a currency other than United States dollars; (d) as to the enforceability in the United States of any waiver of immunity to the extent it applies to immunity acquired after the date of the relevant agreement; or (e) any waiver of forum non conveniens or similar doctrine with respect to proceedings in any court other than a court of the State of New York.

 

For purposes of the opinions rendered above, (i) “Applicable Law” means United States federal laws (other than the federal securities laws), the laws of the State of New York and those provisions of the General Corporation Law of the State of Delaware which in each case in our experience are normally applicable to transactions of the type contemplated by the Purchase Agreement and (ii) “Governmental Authority” means any United States federal or State of New York administrative, judicial or other governmental agency, authority, tribunal or body.

 

We express no opinion as to matters governed by any laws other than the laws of the State of New York, the General Corporation Law of the State of Delaware, and United States federal laws. The opinions contained herein are rendered to you and are solely for your benefit in connection with the closing under the Purchase Agreement of the sale of the Securities occurring today and may not be used, quoted, relied upon or otherwise referred to by any other person or for any other purpose without our express written consent in each instance. We disclaim any obligation to update anything herein for events occurring after the date hereof.

 

Annex 5(D)-1 - 3

 

ANNEX 5(D)-2

 

NEGATIVE ASSURANCE LETTER

OF

MILBANK, TWEED, HADLEY & McCLOY LLP

 

On the basis of and subject to the foregoing, we confirm to you that nothing has come to our attention that causes us to believe that: (i) the Disclosure Package (other than the financial statements and other financial information contained or incorporated by reference in or omitted from the Disclosure Package, as to which we express no belief and make no statement), as of the Applicable Time, or (ii) the Final Offering Memorandum (other than the financial statements and other financial information contained or incorporated by reference in or omitted from the Final Offering Memorandum, as to which we express no belief and make no statement), as of its date and at the date hereof, contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

Annex 5(D)-2 - 1

 

ANNEX 5(E)

 

OPINION OF CONYERS DILL & PEARMAN LIMITED

 

1.                                      The Guarantor is duly incorporated and existing under the laws of Bermuda in good standing (meaning solely that it has not failed to make any filing with any Bermuda governmental authority, or to pay any Bermuda government fee or tax, which would make it liable to be struck off the Register of Companies and thereby cease to exist under the laws of Bermuda).

 

2.                                      The Guarantor has the necessary corporate power and authority to conduct its business and to own, lease and operate its property as described in the Offering Memorandum.

 

3.                                      The Guarantor has the necessary corporate power and authority to enter into and perform its obligations under the Documents, including, for the avoidance of doubt, the issuance of the Exchange Shares. The execution and delivery of the Documents by the Guarantor and the performance by the Guarantor of its obligations thereunder will not violate the memorandum of association or bye-laws of the Guarantor nor any applicable law, regulation, order or decree in Bermuda.

 

4.                                      The Guarantor has taken all corporate action required to authorise its execution, delivery and performance of the Documents, including, for the avoidance of doubt, the issuance of the Exchange Shares.  The Documents have been duly executed and delivered by or on behalf of the Guarantor, and constitute the valid, binding and enforceable obligations of the Guarantor in accordance with the terms thereof.

 

5.                                      No order, consent, approval, licence, authorisation or validation of or exemption by any government or public body or authority of Bermuda or any sub-division thereof is required to authorise or is required in connection with the execution, delivery, performance and enforcement of the Documents, except such as have been duly obtained in accordance with Bermuda law.

 

6.                                      It is not necessary or desirable to ensure the enforceability in Bermuda of the Documents that they be registered in any register kept by, or filed with, any governmental authority or regulatory body in Bermuda.  However, to the extent that any of the Documents creates a charge over assets of the Guarantor, it may be desirable to ensure the priority in Bermuda of the charge that it be registered in the Register of Charges in accordance with Section 55 of the Companies Act 1981.  On registration, to the extent that Bermuda law governs the priority of a charge, such charge will have priority in Bermuda over any unregistered charges, and over any subsequently registered charges, in respect of the assets which are the subject of the charge.  A registration fee of $630 will be payable in respect of the registration.

 

While there is no exhaustive definition of a charge under Bermuda law, a charge includes any interest created in property by way of security (including any mortgage, assignment, pledge, lien or hypothecation).  As the Documents are governed by the

 

Annex 5(E) - 1

 

Foreign Laws, the question of whether they create such an interest in property would be determined under the Foreign Laws.

 

7.                                      The Documents will not be subject to ad valorem stamp duty in Bermuda and no registration, documentary, recording, transfer or other similar tax, fee or charge is payable in Bermuda in connection with the execution, delivery, filing, registration or performance of the Documents other than as stated in paragraph 5 hereof.

 

8.                                      The Exchange Shares have been duly authorized and when issued and paid for upon exchange of the Notes in accordance with the Indenture, will be validly issued, fully paid and non-assessable.

 

9.                                      Based solely on a search of the public records in respect of the Guarantor maintained at the offices of the Registrar of Companies at [TIME] on [•] January 2017, the authorised share capital of the Guarantor is US$825,000 divided into 825,000,000 total shares of which 800,000,000 are Common Shares and 25,000,000 are preferred shares, par value US$0.001 each.

 

10.                               Based solely upon a review of the register of members of the Guarantor prepared by Computershare Shareholder Services Inc., the branch registrar of the Guarantor, on [31] December 2016, there are [333,597,742] issued Common Shares of the Guarantor, all of which are validly issued, fully paid and non-assessable (which term when used herein means that no further sums are required to be paid by the holders thereof in connection with the issue thereof) and such shares are not subject to any statutory pre-emptive or similar rights.

 

11.                               The statements set forth in the Offering Memorandum under the caption “Description of Authorized Share Capital” and “Certain Bermuda Tax Considerations” to the extent they constitute statements of Bermuda law, are accurate in all material respects.

 

12.                               The choice of the Foreign Laws as the governing law of the Documents is a valid choice of law and would be recognised and given effect to in any action brought before a court of competent jurisdiction in Bermuda, except for those laws (i) which such court considers to be procedural in nature; (ii) which are revenue or penal laws or (iii) the application of which would be inconsistent with public policy, as such term is interpreted under the laws of Bermuda.  The submission in the Documents to the jurisdiction of the respective Foreign Courts is valid and binding upon the Guarantor. The appointment of an agent for service of process pursuant to the Documents is valid and binding upon the Guarantor.

 

13.                               The courts of Bermuda would recognise as a valid judgment, a final and conclusive judgment in personam obtained in the respective Foreign Courts against the Guarantor based upon the Documents under which a sum of money is payable (other than a sum of money payable in respect of multiple damages, taxes or other charges of a like nature or in respect of a fine or other penalty) and would give a judgment

 

Annex 5(E) - 2

 

based thereon provided that (a) such courts had proper jurisdiction over the parties subject to such  judgment; (b) such courts did not contravene the rules of natural justice of Bermuda; (c) such judgment was not obtained by fraud; (d) the enforcement of the judgment would not be contrary to the public policy of Bermuda; (e) no new admissible evidence relevant to the action is submitted prior to the rendering of the judgment by the courts of Bermuda; and (f) there is due compliance with the correct procedures under the laws of Bermuda.

 

14.                               The obligations of the Guarantor under the Documents will rank at least pari passu in priority of payment with all other unsecured unsubordinated indebtedness of the Guarantor, other than indebtedness which is preferred by virtue of any provision of the laws of Bermuda of general application.

 

15.                               The transactions contemplated by the Documents are not subject to any currency deposit or reserve requirements in Bermuda. The Guarantor has been designated as non-resident of Bermuda for the purposes of the Exchange Control Act 1972 and, as such, is free to acquire, hold and sell foreign currency and securities without restriction.

 

16.                               Based solely upon a search of the Cause Book of the Supreme Court of Bermuda conducted at approximately [TIME] a.m. on [•] January 2017 (which would not reveal details of proceedings which have been filed but not actually entered in the Cause Book at the time of our search), there are no judgments against the Guarantor, nor any legal or governmental proceedings pending in Bermuda to which the Guarantor is subject.

 

17.                               Based solely on a search of the public records in respect of the Guarantor maintained at the offices of the Registrar of Companies at approximately [TIME] a.m. on [•] January 2017 (which would not reveal details of matters which have not been lodged for registration or have been lodged for registration but not actually registered at the time of our search) and a search of the Cause Book of the Supreme Court of Bermuda conducted at approximately [TIME] a.m. on [•] January 2017  (which would not reveal details of proceedings which have been filed but not actually entered in the Cause Book at the time of our search), no details have been registered of any steps taken in Bermuda for the appointment of a receiver or liquidator to, or for the winding-up, dissolution, reconstruction or reorganisation of, the Guarantor, though it should be noted that the public files maintained by the Registrar of Companies do not reveal whether a winding-up petition or application to the Court for the appointment of a receiver has been presented and entries in the Cause Book may not specify the nature of the relevant proceedings.

 

18.                               The Guarantor is not entitled to any immunity under the laws of Bermuda, whether characterised as sovereign immunity or otherwise, from any legal proceedings to enforce the Documents in respect of itself or its property.

 

Annex 5(E) - 3

 

19.                               At the present time, there is no Bermuda income or profits tax, withholding tax, capital gains tax, capital transfer tax, estate duty or inheritance tax payable by the Guarantor or by its shareholders in respect of its shares. The Guarantor has obtained an assurance from the Minister of Finance of Bermuda under the Exempted Undertakings Tax Protection Act 1966 that, in the event that any legislation is enacted in Bermuda imposing any tax computed on profits or income, or computed on any capital asset, gain or appreciation or any tax in the nature of estate duty or inheritance tax, such tax shall not, until 31 March 2035, be applicable to the Guarantor or to any of its operations or to its shares, debentures or other obligations except insofar as such tax applies to persons ordinarily resident in Bermuda or is payable by the Guarantor in respect of real property owned or leased by the Guarantor in Bermuda.

 

Annex 5(E) - 4

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