DEF 14A of Nabors Industries LTD, Apr 25, 2024

DEF 14A of Nabors Industries LTD

Filed Apr 25, 2024 · FY20230001193125-24-113587

Open on EDGAR

  1. Board Practices and Commitment

    | Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2)(3) | Option Awards ($)(4) | Non-Equity Incentive Plan Compensation ($) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($)(5) | Total ($) | | Tanya S. Beder | 155,000 | 125,000 | 0 | 0 | 0 | 269,000 | 549,000 | | Anthony R. Chase | 150,000 | 125,000 | 0 | 0 | 0 | 275,000 | 550,000 | | James R. Crane | 130,000 | 125,000 | 0 | 0 | 0 | 125,000 | 380,000 | | John P. Kotts | 170,000 | 125,000 | 0 | 0 | 0 | 125,000 | 420,000 | | Michael C. Linn | 140,000 | 125,000 | 0 | 0 | 0 | 269,000 | 534,000 | | John Yearwood | 180,000 | 125,000 | 0 | 0 | 0 | 125,000 | 430,000 |

  2. Delinquent Section 16(a) Reports

    | • | Mr. Crane was not and is not involved in the commercial decisions of either the Company or the CCG companies related to the provision of services to the Company; and |

  3. Delinquent Section 16(a) Reports

    | Name, Age and Primary Occupation | | Director Since | Independent | Committees | | | Tanya S. Beder, Age 68 Chair and CEO of SBCC Group Inc. | 2017 | ✓ | Audit, Compensation (Chair), Technology and Safety | | | Anthony R. Chase, Age 69 Chair and CEO of ChaseSource, L.P. | 2019 | ✓ | Compensation, ESG, Risk Oversight (Chair) | | | James R. Crane, Age 70 Chair and CEO of Crane Capital Group Inc. | 2012 | ✓ | Executive, Technology and Safety (Chair) | | | John P. Kotts, Age 73 Private investor and entrepreneur | 2013 | ✓ | Audit (Chair), Compensation | | | Michael C. Linn, Age 72 President and CEO of MCL Ventures, LLC | 2012 | ✓ | ESG (Chair), Risk Oversight | | | Anthony G. Petrello, Age 69 Chairman of the Board, President and CEO | 1991 | | Executive (Chair) | | | John Yearwood, Age 64 Independent Lead Director Retired President, CEO and COO of Smith International, Inc. | 2010 | ✓ | Audit, ESG, Executive, Risk Oversight, Technology and Safety |

  4. Delinquent Section 16(a) Reports

    | | Tanya S. Beder, 68, Independent Director DIRECTOR SINCE: 2017 OTHER PUBLIC COMPANY BOARDS: 1 – Kirby Corporation (NYSE: KEX) COMMITTEES: Audit, Compensation (Chair), Technology and Safety |

  5. Delinquent Section 16(a) Reports

    | | Anthony R. Chase, 69, Independent Director DIRECTOR SINCE: 2019 OTHER PUBLIC COMPANY BOARDS: 3 – LyondellBasell Industries N.V. (NYSE: LYB) – CullenFrost Bank (NYSE: CFR) – Par-Pacific Holdings, Inc. (NYSE: PARR) COMMITTEES: Compensation, ESG, Risk Oversight (Chair) |

  6. Delinquent Section 16(a) Reports

    | | James R. Crane, 70, Independent Director DIRECTOR SINCE: 2012 OTHER PUBLIC COMPANY BOARDS: 0 COMMITTEES: Executive, Technology and Safety (Chair) |

  7. Delinquent Section 16(a) Reports

    | | John P. Kotts, 73, Independent Director DIRECTOR SINCE: 2013 OTHER PUBLIC COMPANY BOARDS: 0 COMMITTEES: Audit (Chair), Compensation |

  8. Delinquent Section 16(a) Reports

    | | Michael C. Linn, 72, Independent Director DIRECTOR SINCE: 2012 OTHER PUBLIC COMPANY BOARDS: 1 – Black Stone Minerals, L.P. (NYSE: BSM) COMMITTEES: ESG (Chair), Risk and Oversight |

  9. Delinquent Section 16(a) Reports

    | | Anthony G. Petrello, 69, Chairman of the Board, President and Chief Executive Officer NON-INDEPENDENT DIRECTOR DIRECTOR SINCE: 1991 OTHER PUBLIC COMPANY BOARDS: 1 – Nabors Energy Transition Corp. II (NASDAQ: NETDU) COMMITTEES: Executive (Chair) |

  10. Delinquent Section 16(a) Reports

    | | John Yearwood, 64, Independent Director (Lead) DIRECTOR SINCE: 2010 OTHER PUBLIC COMPANY BOARDS: 2 – TechnipFMC plc (NYSE: FTI) – Vast Renewables Ltd. (NASDAQ: VSTE) COMMITTEES: Audit, ESG, Executive, Risk Oversight, Technology and Safety |

  11. Compensation Committee’s Support of CEO

    | (1) Assumes payout at maximum contractual entitlement, and excludes Change in Pension Value, Nonqualified Deferred Compensation Earnings, and All Other Compensation, as such categories would be reflected in the Proxy Statement’s Summary Compensation Table. |

  12. Our Key Components of Executive Compensation

    | Compensation Element | | Settled In | Key Features | Objective | Performance Based | At Risk | | FIXED | Base Salary | Cash | • Fixed cash income to retain and attract highly marketable executives in a competitive market for executive talent | • Reward the skill and expertise that our CEO and CFO contribute to the Company on a day-to-day basis | | | | SHORT-TERM | Performance Based Short Term Incentive | Cash | • Annual cash incentive program • Based 100% on two financial metrics: • Adjusted EBITDA, a primary method used by analysts for evaluation of common shares • CAPEX, prioritizes expenditures towards higher margin business segments | • Designed to motivate executives to achieve annual financial goals and other business objectives and reward them accordingly • Focus on efficient and profitable operations, preservation of shareholder value, improvement in competitive position, and ability to further capitalize on opportunities for growth • Furthers shareholder alignment by placing significant annual compensation at risk | ✓ | ✓ | | | TSR Shares | Equity | • Earned based on relative TSR performance over a three-year period • No shares earned if relative performance is below the peer group 25th percentile, and must achieve at least 85th percentile to earn maximum • Capped at target if absolute TSR is negative • Maximum payout for CEO is capped at 5x the grant date value | • Furthers shareholder alignment by tying significant compensation to achievement of strong relative total return performance over a multi-year period | ✓ | ✓ | | LONG-TERM | Performance Stock Units (PSUs) | Equity | • Earned based on achievement of applicable performance goals established at the beginning of the performance period • Earned PSUs vest equally over a three-year term; earned PSUs above target settled in cash (for CFO, at Compensation Committee’s discretion) | • Furthers shareholder alignment by tying significant compensation to achievement of strategic objectives critical to long-term growth • Payouts of PSU grants on a three year basis ties compensation to long-term shareholder interests | ✓ | ✓ | | | Long-Term Performance Share Units | Equity | • Earned based on achievement of three-year financial metric • For 2023, Return on Invested Capital (ROIC) metric | • Furthers shareholder alignment over multi-year period by tying compensation to achievement of strategic objectives critical to long-term growth | ✓ | ✓ |

  13. How We Determine Annual Cash Incentive

    How We Determine Annual Cash Incentive All of our CEO’s and CFO’s annual cash incentive awards are based on performance metrics. The annual cash incentive is targeted at 100% of the executives’ base salaries and capped at twice such amount. This cap of 2.0 times base salary is amongst the lowest of Nabors’ peers, which ranges from 1.98 to 3.50 times base salary. The metrics for earning the annual cash incentives are determined by the Compensation Committee at the beginning of the applicable performance year based on well-defined, measurable metrics. The Compensation Committee sets targets for achieving those goals:

  14. How We Determine Annual Cash Incentive

    | • | Minimum threshold before any annual cash incentive can be earned; |

  15. How We Determine Annual Cash Incentive

    | • | Target award dollar amount to incentivize a specific desired performance level; and |

  16. How We Determine Annual Cash Incentive

    | • | Maximum goal which sets an appropriate limit on the potential annual cash incentive that can be earned. |

  17. How We Determine Annual Cash Incentive

    The performance measures are pushed down to the business units and functions to ensure all employees throughout the Company are focused on the same goals. At the end of the performance year, the Compensation Committee determines whether the performance goals have been attained and approves any cash payment amount based upon the level of achievement of the pre-established annual performance goals. If actual performance results fall between payout levels, straight-line interpolation is used to determine the award payout. Adjustments to targets are permitted as deemed appropriate by the Board to account for significant events that warrant an adjustment.

  18. How We Determine Long-Term Equity Incentives

    How We Determine Long-Term Equity Incentives For 2023, Long-Term Equity Incentives consisted of three core components: (1) a Multi-Year Performance Unit Award, (2) TSR Shares and (3) Performance Stock Units. Importantly, 100% of the Long-Term Equity Incentives granted to our CEO and CFO during 2023 were 100% performance based. Each of these components is described in more detail below.

  19. How We Determine Long-Term Equity Incentives

    | TSR Shares | | | Key Features | • Cliff vesting based on the Company’s TSR performance relative to the peer group measured over a three-year period • Minimum performance criteria must be met in order for any TSR Shares to vest • Number of shares that may vest at end of performance period are capped at target if our TSR performance is negative • Aligns executive incentives with share performance while avoiding excessive payouts • In response to shareholder feedback, the payout metrics for TSR awards shall be earned on a relative percentile basis instead of a ranking class to ensure payout is fully aligned with performance |

  20. How We Determine Long-Term Equity Incentives

    | 60 | | 2024 Proxy Statement |

  21. How We Determine Our Performance-Based TSR Shares

    | 2023 TSR Grant | | | | Award Payout Level | TSR Relative to the Peer Group at End of Performance Cycle | Percentage of Target Shares Earned | | Maximum | 85th Percentile or greater | 200% | | Target | 50th Percentile | 100% | | Threshold | 25th Percentile | 50% | | No Payout | Below 25th Percentile | 0% |

  22. How We Determine the Level of Performance Stock Units Earned

    How We Determine the Level of Performance Stock Units Earned

  23. How We Determine the Level of Performance Stock Units Earned

    | Performance Stock Units | | | Key Features | • PSUs are earned based on one-year performance metrics (which metrics are intended to build toward long-term strategic initiatives), and subject to a 3-year vesting period following the grant date (with 1/3rd vesting on the first anniversary of the grant date and 1/3rd on each of the second and third anniversaries thereof). Earned units vest in equal increments subject to continued employment, even though the applicable performance goals were met. • Subject to a maximum award amount. • This structure provides for a longer period of shareholder alignment, and an additional retention element, because the shares underlying the PSUs are not issued until the vesting term has been satisfied (i.e., both the performance and service elements have been satisfied). • PSUs are earned on an overall goal completion percentage, which is based on relative weighting of each individual goal performance achievement. For the 2023 performance cycle: 1) Threshold level performance required the achievement of at least one goal; 2) Target level performance required the achievement of the equivalent of 50% of all goals; and 3) Maximum level performance required achievement of all four goals for the CEO and all four goals for the CFO. • The target value of 200% of our CEO’s contractual base salary and 100% of our CFO’s contractual base salary is awarded to our CEO and CFO, each of whom then has the opportunity to earn 200% of the number of target PSUs granted based on the level of achievement of the established performance goals. • The CEO (for the CFO, at the discretion of the Compensation Committee) receives cash in respect of any Performance Stock Units earned above target. |

  24. How We Determine the Level of Performance Stock Units Earned

    | 2024 Proxy Statement | | 61 |

  25. How We Determine the Level of Performance Stock Units Earned

    | Long Term Performance Stock Units | | | | Key Features | • The Long-Term Performance Goal will be measured as of the end of the performance period and for 2023 the number of Long-Term PSUs (“LTPSUs”) that become “Earned LTPSUs” will be based on the following: | | | | ROIC Pay-out Opportunity | Percentage of LTPSUs Earned | | | < 12% | 0% | | | 12% (target) | 100% of Target Number | | | ≥14% (maximum) | 200% of Target Number | | | • If the Long-Term Performance Goal is determined to be achieved between target and maximum level, then the percentage of LTPSUs that are earned shall be linearly interpolated on a straight-line basis between those two points. No LTPSUs shall be earned if actual performance is below target level. • “ROIC” for each fiscal year shall be calculated as the percentage equal to Adjusted Operating Income / (Net Debt + Equity), as those numbers are reported and calculated in accordance with the Company’s audited financial statements. | |

  26. How We Determine the Level of Performance Stock Units Earned

    2023 Performance Achievements

  27. Assessment of 2023 Annual Cash Incentive Award Achievement

    Assessment of 2023 Annual Cash Incentive Award Achievement For 2022 and 2023, our CEO’s and CFO’s annual cash incentive award was based on “Adjusted EBITDA less CAPEX”. In 2021, the CEO’s and CFO’s annual cash incentive was based solely on Adjusted EBITDA (See Annex A for definition). “Adjusted EBITDA less CAPEX” is a significant consideration used by investors and analysts in evaluating the Company and is therefore, we believe, a key driver of the Company’s share price. Building upon our use of Adjusted EBITDA as a financial metric to drive performance, and in response to shareholder feedback, “Adjusted EBITDA less CAPEX” aligns our financial discipline to target our capital spending to higher margin, lower capital-intensive business segments. All references to “CAPEX” in these measures excludes SANAD new build rig capex.

  28. Assessment of 2023 Annual Cash Incentive Award Achievement

    | 2023 Performance Achievements | | | | | | Objective | Weight | Target Ranges | Performance Achieved | Cash Incentive Earned | | Adjusted EBITDA less CAPEX | 100% | • Threshold: $443.1M • Target: $633M • Maximum: $759.6M | The Company’s Adjusted EBITDA less CAPEX for 2023 was $570M versus $419M in 2022 which represents a 36% increase | Performance exceeded the Threshold but was less than the Target. Thus, the cash incentive earned was approximately $1.58M for the CEO and approximately $675,000 for the CFO |

  29. Assessment of 2023 Annual Cash Incentive Award Achievement

    Our Corporate Secretary’s annual cash incentive is based on the achievement of quantitative and qualitative performance goals established at the beginning of the annual performance period. For 2023, his performance goals included targeted shareholder outreach and improvements to corporate governance and compliance programs. His cash incentive for 2023 was $90,420.

  30. Assessment of 2023 Performance Stock Units Achievement (Granted in January 2023 and Earned in 2023 Based on 2023 Performance)

    Assessment of 2023 Performance Stock Units Achievement (Granted in January 2023 and Earned in 2023 Based on 2023 Performance) For the 2023 performance cycle, our CEO had four performance goals as set forth in the table below. Consistent with the request of shareholders, the goals are all more prescriptive and weighted heavily toward financial performance and continued improvement in emissions reduction and diversity targets.

  31. CEO Performance Goals and 2023 Achievement

    CEO Performance Goals and 2023 Achievement

  32. CEO Performance Goals and 2023 Achievement

    | 2023 CEO Performance Goals and Achievements | | | | | | Performance Goal and Rationale | Degree of Achievement Determined (out of 100%) | Goal Weighting | | 1 | Achieve at least $450M reduction in net debt (excluding any distributions of cash to Saudi Aramco and any CAPEX related to the SANAD In-Kingdom new build rigs incurred in 2023) Rationale: Part of long-term corporate objective to reduce financial leverage and associated risks and increased shareholder value. Actual net debt reduction achieved in 2022 was $186.1M. | 47.4% | 30% | | 2 | Achieve 2023 Adjusted EBITDA for NDS of $150M. (75% weight) | 88.6% | 25% | | | Achieve $101M for NDS Total International Revenue (12.5% weight) | | | | | Achieve $119M for NDS Total Third-Party Revenue (12.5% weight) Rationale: Increase profit in this low capital intensity, high margin business. Actual Adjusted EBITDA for NDS in 2022 was $98.7M. | | | | 3 | Generate $20M in Adjusted Gross Margin from Energy Transition products, including but not limited to SmartPOWER, PowerTAP, PowerFLOW, and HIC. Rationale: To increase the profit of this new business segment, further diversifying income streams and while lowering emissions. | 86.5% | 25% | | 4 | Emissions Reduction (10% in Total) Reduce US Drilling’s scope 1 emissions intensity to 41.7 CO2/ft drilled or 3%, relative to 2022 (5% weight) | | | | | Reduce International Drilling scope 1 emissions intensity to 89 CO2/ft drilling or 3.7%, relative to 2022 (5% weight) | | | | | Increase Diversity (10% in Total) Achieve at least 55% of all new hires of US employees SGA and FS (all levels) to be diverse (5% weight) | 100% | 20% | | | Achieve at least 30% of all US employee SGA and FS new undergraduate hires (i.e., within six months post college graduation) to be females (5% weight) Rationale: Align business objectives and performance with broad stakeholder base and a specific response to shareholder request to tie executive compensation to ESG goals. | | |

  33. CEO Performance Goals and 2023 Achievement

    CEO Payout Results for 2023 Performance Units: The overall percentage achieved is the weighted average of the percentage completed for each goal, or 77.99%. Pursuant to the terms of the 2023 Performance Stock Units, achievement of 77.99% results in a payout level of 155.99% of the target amount (23,791 Performance Stock Units) being achieved, for a total of 37,111 Performance Stock Units being earned. This payout level reflects the following payout slopes applicable to the Performance Stock Units: weighted average of the percentage completed for each goal at 50% results in 100% of the target number of Performance Stock Units being earned, and a weighted average of the percentage completed for each goal at 100% results in 200% of the target number of Performance Stock Units being earned, with linear interpolation between points. For the 2023 performance cycle, our CFO had the 4 performance goals set forth in the table below. Consistent with the request of shareholders, the goals are weighted more heavily toward financial performance.

  34. CEO Performance Goals and 2023 Achievement

    | 2024 Proxy Statement | | 63 |

  35. CFO Performance Goals and 2023 Achievement

    CFO Performance Goals and 2023 Achievement

  36. CFO Performance Goals and 2023 Achievement

    | 2023 CFO Performance Goals and Achievements | | | | | | Performance Goal and Rationale | Degree of Achievement Determined (out of 100%) | Goal Weighting | | 1 | Achieve at least $450M reduction in net debt (excluding any distributions of cash to Saudi Aramco and any CAPEX related to the SANAD In-Kingdom new build rigs incurred in 2023) Rationale: Part of long-term corporate objective to reduce financial leverage and associated risks and increased shareholder value. Actual net debt reduction achieved in 2022 was $186.1M. | 47.4% | 30% | | 2 | Achieve 2023 Adjusted EBITDA for NDS of $150M. (75% weight) | 88.6% | 25% | | | Achieve $101M for NDS Total International Revenue (12.5% weight) | | | | | Achieve $119M for NDS Total Third-Party Revenue (12.5% weight) Rationale: Increase profit in this low capital intensity, high margin business. Actual Adjusted EBITDA for NDS in 2022 was $98.7M. | | | | 3 | Generate $20M in Adjusted Gross Margin from Energy Transition products, including but not limited to SmartPOWER, PowerTAP, PowerFLOW, and HIC. Rationale: To increase the profit of this new business segment, further diversifying income streams and while lowering emissions. | 86.5% | 25% | | 4 | Repay all the 2023 and 2024 maturities of $227 million and reduce by $350 million the 2025 senior note maturities to reduce the outstanding notes due in 2025 to $350 million Rationale: Restructure debt to reduce near term capital markets exposure. | 100% | 20% |

  37. CFO Performance Goals and 2023 Achievement

    CFO Payout Results for 2023 Performance Units: The overall percentage achieved is the weighted average of the percentage completed for each goal, or 77.99%. Pursuant to the terms of the 2023 Performance Stock Units, achievement of 77.99% results in a payout level of 155.99% of the target amount (5,098 Performance Stock Units) being achieved, for a total of 7,952 Performance Stock Units being earned. This payout level reflects the following payout slopes applicable to the Performance Stock Units: weighted average of the percentage completed for each goal at 50% results in 100% of the target number of Performance Stock Units being earned, and a weighted average of the percentage completed for each goal at 100% results in 200% of the target number of Performance Stock Units being earned, with linear interpolation between points.

  38. Restricted Stock Award to the Corporate Secretary

    Restricted Stock Award to the Corporate Secretary The Corporate Secretary received a long-term equity-based compensation award in the form of restricted shares that vest over time. In 2023, he received a long-term equity incentive award in the form of restricted shares on February 15, 2023, the number of which was determined by applying a multiplier of 1.0 to his annual cash incentive for 2022, which was $150,700, and dividing the product by $165.80, which was the value of our shares on the grant date. Based on this calculation, he was granted 909 restricted shares, with restrictions lapsing ratably over four years.

  39. Equity-Based Award Policy

    | • | The Compensation Committee delegates authority to the CEO, subject to predetermined caps, to approve equity awards to non-executive employees at other times during the year, such as in connection with new hires and promotions, or in connection with the appraisal review and compensation adjustment process for employees. |

  40. Role of the Compensation Committee

    | • | Administers our equity-based programs for senior leadership team members, and reviews and approves all forms of compensation (including equity grants); |

  41. Role of the Compensation Committee

    | • | Approves financial and business measures and goals that are tied to the Company’s performance for long-term equity incentive awards; |

  42. Role of the Compensation Committee

    | • | Oversees employment agreements between the Company and the executive officers; |

  43. Role of the Independent Compensation Consultant

    Role of the Independent Compensation Consultant The Compensation Committee has the sole authority to retain, obtain the advice of, and terminate, any compensation consultant, independent legal counsel, or other advisors to assist the Compensation Committee in the discharge of its duties and responsibilities, including the evaluation of director and executive compensation. In the discharge of its duties, the Compensation Committee relies on an independent consultant to:

  44. Role of the Independent Compensation Consultant

    | • | Provide information and analysis on executive compensation trends and market developments; |

  45. Role of the Independent Compensation Consultant

    | • | Advise on potential peer group members to evaluate our CEO’s CFO’s and Corporate Secretary’s compensation; |

  46. Role of the Independent Compensation Consultant

    | • | Review and analyze peer group information to assist with setting of executive compensation; |

  47. Role of the Independent Compensation Consultant

    | • | Review and analyze peer group information to assist with setting of independent Directors’ compensation; |

  48. Role of the Independent Compensation Consultant

    | • | Update the Compensation Committee periodically on legislative and regulatory developments impacting executive compensation; and |

  49. Role of the Independent Compensation Consultant

    | • | Provide additional assistance, as requested by the Compensation Committee. |

  50. Role of the Independent Compensation Consultant

    In 2021, the Compensation Committee engaged Pay Governance as its independent consultant to advise and assist the Committee with benchmarking the executive compensation program. The Compensation Committee evaluated Pay Governance’s independence during 2023 by considering a number of factors, including the six factors identified by the NYSE and the SEC independence guidelines. Based on these evaluations, the Compensation Committee concluded there were no independence or conflict-of-interest concerns related to Pay Governance’s engagement.

  51. Role of the Independent Compensation Consultant

    | 2024 Proxy Statement | | 65 |

  52. Severance and Other Payments

    Severance and Other Payments Severance protection can play a valuable role in attracting and retaining key executive officers and ensuring that they remain focused on the interests of the Company and our shareholders. Accordingly, we provide such protection for our CEO and CFO under various circumstances. Termination Resulting from Death or Disability. Our CEO’s employment agreement provides that in the event of his death or Disability: (i) all restricted shares outstanding (including all unvested TSR shares at target) shall vest on the vesting date; (ii) all outstanding options shall vest and remain exercisable for the remainder of the term; (iii) any amounts previously earned but unpaid, including a pro-rated portion of his annual cash incentive shall be payable; (iv) all unvested Performance Stock Units shall become vested (provided that (a) if the date of such termination occurs after the conclusion of the performance period but prior to the final determination of performance, then the number of earned Performance Stock Units shall be determined based on actual performance, and (b) if the date of such termination occurs prior to the conclusion of the performance period, then the earned Performance Stock Units shall be deemed to equal 200% of the target Performance Stock Units, pro-rated for the portion of the performance period during which our CEO was employed) and (v) he and his family shall remain covered under Company health plans until the later of the date he receives equivalent coverage under another employer or the death of him and his spouse. Mr. Petrello also will continue to be eligible for certain other benefits for three years following his termination resulting from Disability. He also is entitled to all amounts under the Executive Deferred Compensation Plan. Our CFO’s employment agreement is substantially similar to our CEO’s employment agreement. Termination by Executive for Constructive Termination without Cause, or by the Company without Cause. In the event of a Constructive Termination without Cause, or if he is terminated by the Company without Cause, our CEO’s employment agreement provides for severance benefits substantially similar to those set forth above under “Termination Resulting from Death or Disability.” In addition, he would be entitled to 2.99 times the average of his base salary and annual cash incentive during each of the last three completed fiscal years.

  53. Severance and Other Payments

    | 66 | | 2024 Proxy Statement |

  54. Severance and Other Payments

    Our CFO’s employment agreement is similar, except that he and his family are entitled to receive continued health coverage until the earlier of (a) the date that he or another member of his family receives health coverage by a subsequent employer; (b) three years from the date of the termination of his employment; or (c) the dates of his and his spouse’s death. Termination by the Company for Cause or by Written Voluntary Resignation. Our CEO’s employment agreement provides for: (i) base salary through the date of termination; (ii) vesting of all unvested restricted stock that was granted in connection with the annual incentive (if any); (iii) the vesting of all unvested options granted in connection with the annual incentive (if any), which (in addition to any stock options vested prior to the date of termination) shall remain exercisable for the remainder of its term; (iv) forfeiture of all unvested TSR Shares and Performance Stock Units; (v) payment of all amounts previously earned but unpaid; and (vi) in connection with a voluntary resignation only, continuation of health benefits for him and his family until the death of him and his spouse. He also is entitled to other or additional benefits in accordance with applicable plans or programs in effect at the time of termination. Our CFO’s employment agreement provides for: (i) base salary through the date of termination; (ii) forfeiture of unvested TSR Shares and Performance Stock Units; (iii) payment of all amounts previously earned but unpaid, and (iv) other or additional benefits in accordance with applicable plans or programs in effect at the time of termination. Termination after Expiration Date of Employment Agreement. Our CFO’s employment agreement provides that if he remains employed beyond the expiration date, and his employment is then terminated as a result of his death or Disability, or by the Company without Cause, he shall be entitled to the following: (i) vesting of all unvested restricted shares (other than TSR Shares) and options; (ii) vesting of TSR Shares at target; and (iii) continuation of health coverage until the earlier of (a) the date that he or another member of his family receives health coverage by a subsequent employer; (b) three years from the date of the termination of his employment; or (c) the dates of his and his spouse’s death. He also is entitled to all amounts under the Executive Deferred Compensation Plan. Our CEO’s Agreement does not include a similar provision. Termination due to Qualified Retirement. Subject to the CFO providing at least 200 days’ notice to the Company, he shall be entitled to the following: (i) vesting of all unvested restricted shares (other than TSR Shares) and options; (ii) vesting of TSR Shares at maximum levels; and (iii) continuation of health coverage until the earlier of (a) the date that he or another member of his family receives health coverage by a subsequent employer; (b) three years from the date of the termination of his employment; or (c) the dates of his and his spouse’s death. He also is entitled to all amounts under the Executive Deferred Compensation Plan. Our CEO’s Agreement does not address this scenario. Change in Control. In the event of a Change in Control with no termination of employment, our CEO’s agreement provides that all unvested equity awards shall vest. TSR Shares shall be earned at maximum levels. Earned Performance Stock Units shall become vested as of the date of such Change in Control if our CEO remains continuously employed through the date of such Change in Control; provided that, if such Change in Control occurs prior to the determination of performance, the unearned Performance Stock Units shall be deemed to equal 200% of target. Our CFO’s employment agreement provides that his unvested TSR shares shall vest at maximum level, and other equity awards shall be treated in a manner consistent with other executive direct reports of the CEO. Both executives would be entitled to all vested amounts under the Executive Deferred Compensation Plan if the Change in Control satisfies applicable U.S. Treasury regulations and the Board takes action to liquidate the plan. Additional information regarding severance benefits is included in the table under “Executive Compensation Tables—Potential Payments Upon Termination or Change in Control” below.

  55. Retirement Plans

    | • | Deferred Compensation Plan—a nonqualified deferred compensation plan, which allows certain employees, including some of our named executive officers, to defer an unlimited portion of their base salary and annual cash incentive and to receive Company matching contributions in excess of contributions allowed under our 401(k) Plan because of IRS qualified plan limits. Individual account balances in the Deferred Compensation Plan are adjusted in accordance with deemed investment elections made by the participant using investment vehicles made available from time to time. Distributions from the Deferred Compensation Plan are generally made in the form of a lump-sum payment upon separation of service from the Company. |

  56. Executive Plan

    Executive Plan Under our Executive Deferred Compensation Plan (the “Executive Plan”), we make deferred bonus contributions to accounts established for certain employees, including some of our named executive officers and other senior leaders, based upon their employment agreements, as applicable, or their performance during the year. Individual account balances in the Executive Plan are adjusted in accordance with deemed investment elections made by the participant either using investment vehicles made available from time to time or in a deemed investment fund that provides an annual interest rate on such amounts as established by the Compensation Committee from time to time. The interest rate for the deemed investment fund is currently set at 6%. Our CEO and CFO have elected to participate in this fund, partially and fully, respectively, as have some of our other senior management. Distributions from the Executive Plan are made in the form of lump-sum payments upon death, disability, termination without cause (as defined in the employment agreement), upon vesting or upon departure from the Company after vesting, which generally occurs three to five years after a contribution to the participant’s account. Pursuant to our CEO’s employment agreement, at the end of each calendar quarter through March 31, 2020, the Company credited $300,000 to an account for him under this plan. These credits have continued after March 31, 2020, consistent with his employment agreement and in accordance with the terms of the plan. These deferred amounts, together with earnings thereon, will be distributed to him when (a) he reaches age 70, or (b) upon termination of employment for any reason other than cause. He will forfeit his account balance under this plan upon termination of employment for cause. When our CEO turned 62, he received a one-time payment equal to all amounts credited to that point in excess of $250,000 per calendar quarter, plus all earnings on such amounts. Our CFO is also eligible to participate in the Executive Plan on the same basis as other senior leaders. The Compensation Committee elected to credit $400,000 to his account under the Executive Plan in 2023.

  57. Term of Employment

    by the Company to assist with the transition of management, the termination will be treated as a Constructive Termination without Cause. Upon consideration of the costs associated with unilaterally amending or terminating the CEO’s employment agreement, the Compensation Committee recommended to the independent members of the Board that no action be taken to terminate the agreement at the end of 2023. Neither our CEO nor the Company provided notice of termination. Our CFO’s employment agreement extends automatically by one-year unless Company provides notice of termination 90 days prior to such anniversary, or the CFO gives notice at least 200 days prior to his voluntary retirement. Such notice of termination by the Company does not constitute a Constructive Termination without Cause under his employment agreement. Neither our CFO nor the Company provided notice of termination. Share Ownership and Holding Guidelines To further align executive and shareholder interests, each of our Named Executive Officers are required to own a minimum amount of Company common stock with an acquisition value equal to a specified multiple of their annual base salary. Furthermore, the CEO is required to retain vested shares and shares issued from exercise of options for twelve months.

  58. Term of Employment

    | • | A named executive officer’s ownership of unvested time-based restricted common shares (including RSUs and RSAs) count toward satisfying the stock ownership requirements. A named executive officer’s ownership excludes (a) unearned performance-based restricted stock (including TSRs), (b) shares of common stock underlying unearned performance-based restricted stock units (including PSUs), (c) unexercised stock options and (d) unexercised stock appreciation rights. |

  59. Term of Employment

    | • | Each named executive officer subject to the guidelines must retain 50% of the net shares they acquire upon the exercise of stock options and after the vesting of TSRs, PSUs, RSUs and RSAs, after payment of applicable taxes, until they achieve the required ownership level. |

  60. Term of Employment

    | Name | Year | Salary ($)(1) | Stock Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(3) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)(4) | All Other Compensation ($)(5) | Total $ | | Anthony G. Petrello Chairman of the Board, President and CEO | 2023 | 1,750,000 | 5,562,922 | 1,575,968 | 7,486 | 1,437,658 | 10,334,034 | | | 2022 | 1,750,000 | 4,560,545 | 3,009,880 | 82,818 | 1,386,519 | 10,789,762 | | | 2021 | 1,750,000 | 4,503,129 | 2,167,337 | 338,733 | 1,225,122 | 9,984,321 | | William J. Restrepo Chief Financial Officer | 2023 | 750,000 | 2,225,382 | 675,415 | 3,483 | 738,130 | 4,392,410 | | | 2022 | 748,077 | 1,751,742 | 1,289,949 | 35,092 | 640,414 | 4,465,274 | | | 2021 | 650,000 | 1,621,156 | 805,011 | 124,539 | 465,941 | 3,666,647 | | Mark D. Andrews Corporate Secretary | 2023 | 282,115 | 406,961 | 90,420 | — | 166,741 | 946,237 | | | 2022 | 273,336 | 122,997 | 150,700 | — | 164,922 | 711,955 | | | 2021 | 226,592 | 75,000 | 122,960 | — | 156,022 | 580,574 |

  61. Term of Employment

    | (3) A description of the Executive Plan is set forth above in “Nonqualified Deferred Compensation.” In the event of a Change in Control, assumes the requirements of the applicable U.S. Treasury regulations are met and the Board has taken action to liquidate the Executive Plan. |

  62. Term of Employment

    | (20) Retirement requires at least 200 days prior written notice by Mr. Restrepo to be entitled to potential payments. Accordingly, no entitlement is reflected as of December 31, 2023. In the event of qualifying Voluntary Retirement, this amount would be $8,607,525. |

  63. Term of Employment

    | Year | Summary Compensation Table Total for CEO ($) (1) | Compensation Actually Paid to CEO ($) (2) | Average Summary Compensation Table total for Non-CEO Named Executive Officers ($) (3) | Average Compensation Actually Paid to Non-CEO Named Executive Officers ($) (4) | Value of Initial Fixed $100 Investment Based on: | | Stated in Thousands | | | | | | | | Total Shareholder Return of Nabors | Peer Group Total Shareholder Return (5) | Net Income (Loss) $ (6) | Adjusted EBITDA $ (7) | | 2023 | 10,334,034 | (1,879,135) | 2,669,324 | (584,182) | 58.01 | 129.48 | (11,784) | 915,157 | | 2022 | 10,789,762 | 30,117,200 | 2,588,615 | 5,325,474 | 110.05 | 125.60 | (350,261) | 709,392 | | 2021 | 9,984,321 | 18,318,728 | 2,123,611 | 2,932,914 | 57.62 | 75.93 | (572,925) | 481,940 | | 2020 | 17,538,345 | 4,758,974 | 2,680,569 | 1,001,102 | 41.38 | 60.66 | (820,252) | 563,892 |

  64. Term of Employment

    | (2) The dollar amounts reported represent the amount of “compensation actually paid” to our CEO, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amounts of compensation paid to our CEO during the applicable year. See the table below for more details. |

  65. Term of Employment

    | (4) The dollar amounts reported represent the average amount of “compensation actually paid” to our non-CEO NEOs for the applicable year. For each of the years presented, reflects compensation information for Mr. Andrews and Mr. Restrepo, our non-PEO NEOs for those years. |