NABORS INDUSTRIES LTD

Current report

Risk Factors Relating to the Merger

Current report

Risk Factors Relating to Changes in the Price of Nabors Common Shares

Current report

The market value of Nabors common shares could be negatively affected by risks and conditions that apply to the combined company, which may be different from the risks and conditions applicable to Nabors, and sales of Nabors’ shares in connection with merger would impact the price of our common shares.

Current report

Following the merger, shareholders of Nabors and former stockholders of Parker will own interests in a combined company operating an expanded business with more assets and a different mix of liabilities. Current shareholders of Nabors and current stockholders of Parker may not wish to continue to invest in the combined company or may wish to reduce their investment in the combined company. In addition, if, following the merger, large amounts of Nabors common shares are sold, the price of Nabors common shares could decline.

Current report

Failure to complete the merger could negatively impact the future business and financial results of Nabors.

Current report

The merger is subject to a number of conditions beyond Nabors’ and Parker’s control that may prevent, delay or otherwise materially adversely affect its completion. Such conditions include, but are not limited to, regulatory approval from the Federal Trade Commission and Department of Justice as required under the Hart-Scott-Rodino Act and certain foreign antitrust and foreign direct investment regulatory approvals. We cannot make any assurances that we will be able to satisfy all of the conditions to the merger or succeed in any litigation brought in connection with the merger. If the merger is not completed, our financial results may be adversely affected and we will be subject to several risks, including but not limited to:

Current report

In addition, if the merger is not completed, Nabors may experience negative reactions from the financial markets and from its customers and employees. If the merger is not completed, Nabors cannot assure its stockholders that these risks will not materialize and will not materially and adversely affect the business, financial results and stock price of Nabors.

Current report

Completion of the merger may trigger change in control or other provisions in certain agreements to which Parker is a party.

Current report

The completion of the merger may trigger change in control or other provisions in certain agreements to which Parker is a party. If Nabors and Parker are unable to negotiate waivers of those provisions, the counterparties may exercise their rights and remedies under the agreements, potentially terminating the agreements or seeking monetary damages. Even if Nabors and Parker are able to negotiate waivers, the counterparties may require a fee for such waivers or seek to renegotiate the agreements on terms less favorable to Parker or the combined company. The failure to negotiate a waiver, or to obtain amendments to these agreements on favorable terms, could have an adverse effect on the combined company.

Current report

Litigation relating to the merger could result in an injunction preventing the completion of the applicable transaction and/or substantial costs to us.

Current report

Lawsuits that may be brought against us or our directors could also seek, among other things, injunctive relief or other equitable relief, including a request to rescind parts of the Merger Agreement already implemented and to otherwise enjoin the parties from consummating the applicable transaction. If a plaintiff is successful in obtaining an injunction prohibiting completion of the applicable transaction, that injunction may delay or prevent such transaction from being completed within the expected timeframe or at all, which may adversely affect our business, financial position and results of operations.

Current report

There can be no assurance that any of the defendants will be successful in the outcome of any potential future lawsuits. The defense or settlement of any lawsuit or claim that remains unresolved at the time the merger is completed may adversely affect the combined company’s business, financial condition, results of operations and cash flows.

Current report

The failure to integrate successfully the businesses of Nabors and Parker or to effectively managed the consolidated company post-merger could adversely affect the combined company’s future results.

Current report

The merger involves the integration of two companies that currently operate independently. The success of the merger will depend—in large part—on the ability of the combined company to realize the anticipated benefits, including expected synergies, cost savings, increased innovation and operational efficiencies, from combining the businesses of Nabors and Parker. To realize these anticipated benefits, the businesses of Nabors and Parker must be successfully integrated. This integration will be complex and time-consuming. The failure to integrate successfully and to manage successfully the challenges presented by the integration process may result in the combined company not achieving the anticipated benefits of the merger.

Current report

Potential difficulties that may be encountered in the integration process include the following:

Current report

Any of these difficulties in successfully integrating the businesses of Nabors and Parker, or any delays in the integration process, could adversely affect the combined company’s ability to achieve the anticipated benefits of the merger and could adversely affect the combined company’s business, financial results, financial condition and stock price. Even if the combined company is able to integrate the business operations of Nabors and Parker successfully, there can be no assurance that this integration will result in the realization of the full benefits of synergies, cost savings, increased innovation and operational efficiencies that Nabors and Parker currently expect from this integration, that these benefits will be achieved within the anticipated time frame or that these benefits will match our current expectations. Following integration, the combined company’s future success will depend on its ability to manage its operations, which will be significantly larger than the size of either our or Parker’s existing businesses. The failure to successfully integrate the two companies, to realize the expected benefits of the merger, or to manage the consolidated company’s operations, could have an adverse effect on the consolidated company.

Current report

The combined company is expected to incur substantial expenses related to the integration of Nabors and Parker following the merger.

Current report

The combined company is expected to incur substantial expenses in connection with the integration of Nabors and Parker following the merger. There are many processes, policies, procedures, operations, technologies and systems that must be integrated, including accounting and finance, asset management, benefits, billing, drilling data solutions, health, safety and environment, human resources, maintenance, marketing, payroll and purchasing. Although Nabors and Parker have assumed that a certain level of expenses will be incurred, there are many factors beyond their control that could affect the total amount or the timing of the integration expenses. Moreover, many of the expenses that will be incurred are, by their nature, difficult to estimate accurately. These expenses could, particularly in the near term, exceed the

Current report

savings that the combined company expects to achieve from the elimination of duplicative expenses and the realization of economies of scale and cost savings. These integration expenses could result in the combined company’s taking charges against earnings following the completion of the merger, and the amount and timing of any such charges are uncertain at present.

Current report

The combined company may not be able to utilize a portion of Nabors’ or Parker’s net operating loss carry forwards (“NOLs”) to offset future taxable income for U.S. federal tax purposes, which could adversely affect the combined company’s net income and cash flows.

Current report

As of June 30, 2024, Parker had federal income tax NOLs of approximately $347.8 million, of which $243.5 million will expire between 2035 and 2037, and $104.3 million have an indefinite life. As of September 30, 2024, Nabors had federal income tax NOLs of approximately $559.3 million, all of which have an indefinite life. Utilization of these NOLs depends on many factors, including the combined company’s future taxable income, which cannot be predicted with any accuracy. In addition, Section 382 of the Code generally imposes an annual limitation on the amount of an NOL that may be used to offset taxable income when a corporation has undergone an “ownership change” (as determined under Section 382). Determining the limitations under Section 382 is technical and highly complex. An ownership change generally occurs if one or more shareholders (or groups of shareholders) who are each deemed to own at least 5% of the corporation’s stock increase their ownership by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period. For these reasons, the combined company may not be able to realize a material portion of Parker’s NOLs, which could result in the combined company facing increased future tax liability.

Current report

The due diligence process that we undertook before entering into the Merger Agreement with Parker may not have revealed all facts that may be relevant in connection with merger.

Current report

In deciding whether to enter into the Merger Agreement, we conducted the due diligence investigation that we deemed reasonable and appropriate based on the facts and circumstances applicable to the merger with Parker. When conducting due diligence, we were required to evaluate important and complex business, financial, tax, accounting, technological, governance, legal and regulatory issues. In addition to our employees, outside consultants, legal advisors and accountants were involved in the due diligence process in varying degrees. Despite our efforts, the results of our due diligence may have not been complete and accurate or, even if complete and accurate, may havenot been sufficient to identify all relevant facts, which could prevent us from realizing the anticipated benefits we expect to achieve as a result of the merger with Parker and the business and results of operations of the combined company could be adversely affected.