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Debt | 12 Months Ended
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Dec. 31, 2022
Debt |
Debt | Note 10 Debt ​ Debt consisted of the following: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31, | ​ | December 31, | ​
​ |  | 2022 |  | 2021 |
​ | ​ | (In thousands) |
5.50% senior notes due January 2023 | ​ | $ | — | ​ | $ | 24,446 | ​
5.10% senior notes due September 2023 (1) | ​ |  | 52,004 | ​ |  | 82,703 | ​
0.75% senior exchangeable notes due January 2024 | ​ |  | 177,005 | ​ |  | 259,839 | ​
5.75% senior notes due February 2025 | ​ | ​ | 474,092 | ​ |  | 548,458 | ​
6.50% senior priority guaranteed notes due February 2025 | ​ |  | — | ​ | ​ | 50,485 | ​
9.00% senior priority guaranteed notes due February 2025 | ​ | ​ | 209,384 | ​ | ​ | 218,082 | ​
7.25% senior guaranteed notes due January 2026 | ​ | ​ | 557,902 | ​ |  | 559,978 | ​
7.375% senior priority guaranteed notes due May 2027 | ​ | ​ | 700,000 | ​ |  | 700,000 | ​
7.50% senior guaranteed notes due January 2028 | ​ | ​ | 389,609 | ​ |  | 389,609 | ​
2018 revolving credit facility | ​ |  | — | ​ | ​ | 460,000 | ​
​ | ​ | $ | 2,559,996 | ​ | $ | 3,293,600 | ​
Less: deferred financing costs | ​ | ​ | 22,456 | ​ | ​ | 30,805 | ​
Long-term debt | ​ | $ | 2,537,540 | ​ | $ | 3,262,795 | ​
​
(1) | The 5.10% senior notes due September 2023 were classified as long-term as of December 31, 2022 because we had the ability and intent to refinance this obligation utilizing our 2022 Credit Agreement.
​ As of December 31, 2022, the principal amount and maturities of our primary debt for each of the five years following 2022 and thereafter are as follows: ​
​ | ​ | ​ | ​ | ​
​ |  | Paid at Maturity |
​ | ​ | (In thousands) |
2023 | ​ | $ | 52,092 | (1)
2024 | ​ |  | 177,005 | (2)
2025 | ​ |  | 683,476 | (3)
2026 | ​ |  | 557,902 | (4)
2027 | ​ |  | 700,000 | (5)
Thereafter | ​ |  | 389,609 | (6)
​ | ​ | $ | 2,560,084 | ​
​
(1) | Represents our 5.10% senior notes due September 2023.
​
(2) | Represents our 0.75% senior notes due January 2024.
​
(3) | Represents our 5.75% senior notes due February 2025 and our 9.0% senior priority guaranteed notes due February 2025.
​
(4) | Represents our 7.25% senior notes due January 2026 and our 2022 credit agreement.
​
(5) | Represents our 7.375% senior priority guaranteed notes due May 2027.
​
(6) | Represents our 7.50% senior notes due January 2028.
​ Nabors Delaware’s fixed rate 5.10%, and 5.75% senior unsecured notes are fully and unconditionally guaranteed by us. The notes rank equal in right of payment to all Nabors Delaware’s existing and future senior unsubordinated debt. The notes rank senior in right of payment to all Nabors Delaware’s existing and future senior subordinated and subordinated debt, if any. Our guarantee of the notes is unsecured and ranks equal in right of payment to all our unsecured and unsubordinated indebtedness from time to time outstanding. The notes are subject to redemption by Nabors Delaware, in whole or in part, at any time generally at a redemption price equal to the greater of (i) 100% of the principal amount of the notes then outstanding to be redeemed; or (ii) the sum of the present values of the remaining scheduled payments of principal and interest, determined in the manner set forth in the applicable indenture. In the event of a change in control triggering event, as defined in the indenture, the holders of notes may require Nabors Delaware to purchase all or any part of each note in cash equal to 101% of the principal amount plus accrued and unpaid interest, if any, to the date of purchase, except to the extent Nabors Delaware has previously exercised its right to redeem the notes. The notes have customary covenants, including limitations on the incurrence of liens and entering into sale and leaseback transactions as well as customary events of default. ​ During 2022, 2021 and 2020, we repurchased $99.3 million, $105.9 million and $372.0 million (excluding the January 2020 Tender Offers), aggregate principal amount of our senior unsecured notes for approximately $98.5 million, $93.8 million and $300.9 million, respectively, in cash, reflecting principal, accrued and unpaid interest. Also, during the year ended December 31, 2022, $131.7 million in maturity value of our notes were tendered by warrant holders, and retired, in connection with exercises of the common stock warrants. In January 2022, we repaid the remaining outstanding aggregate principal balance of the 6.5% senior priority guaranteed notes due February 2025 of $50.5 million, and in November, we repaid the remaining outstanding aggregate principal balance of the 5.50% senior notes due January 2023 of $19.7 million. In connection with such repurchases, during 2022, 2021 and 2020, we recognized a net gain of approximately $4.6 million, $13.4 million and $69.2 million, respectively. ​ Exchange Transactions ​ During the first quarter of 2021, we entered into two private exchange transactions in which Nabors Delaware exchanged 9.0% senior priority guaranteed notes due 2025 (the “9.0% Exchange Notes”) for various amounts of existing outstanding notes. Nabors Delaware did not receive any cash proceeds from the issuance of the Exchange Notes. Collectively from the series of exchanges, Nabors Delaware issued $26.1 million aggregate principal amount of the 9.0% Exchange Notes in exchange for $40.0 million aggregate principal amount of various Notes. ​ We recorded a minimal gain in connection with the exchange transactions, which was accounted for in accordance with ASC 470-60, Troubled Debt Restructuring by Debtors. Under ASC 470-60, a gain is recorded in an amount equal to the sum of the future undiscounted payments (principal and interest) related to the new Exchange Notes plus the costs incurred in connection with the transaction, less the carrying value of the notes that were exchanged. In relation to the transactions, we recorded $9.4 million related to future contractual interest payments on the new Exchange Notes and have included this amount in accrued liabilities and other long-term liabilities. ​ The aggregate principal amounts and recognized gain for such transactions were as follows: ​
​ | ​ | ​ | ​
​ | ​ | Year ended December 31,
​ |  | 2021
Exchanged | ​ | ​ | (in thousands)
0.75% senior exchangeable notes due January 2024 | ​ | $ | 35,000
5.75% senior notes due February 2025 | ​ |  | 5,000
Aggregate principal amount exchanged | ​ |  | 40,000
Aggregate principal amount of debt issued in exchanges | ​ | ​ | 26,050
​ 0.75% Senior Exchangeable Notes Due January 2024 ​ In January 2017, Nabors Delaware issued $575.0 million in aggregate principal amount of 0.75% exchangeable senior unsecured notes due 2024, which are fully and unconditionally guaranteed by Nabors. The notes bear interest at a rate of 0.75% per year payable semiannually on January 15 and July 15 of each year, beginning on July 15, 2017. As of December 31, 2022 and December 31, 2021, there was approximately $177.0 million and $287.3 million in aggregate principal amount that remained outstanding, respectively. ​ The exchangeable notes are currently exchangeable, under certain conditions, at an exchange rate of .8018 common shares of Nabors per $1,000 principal amount of exchangeable notes (equivalent to an exchange price of approximately $1,247.19 per common share). As a result of an amendment to the notes, upon any exchange, Nabors Delaware will settle its exchange obligation in cash. The exchangeable notes were originally bifurcated for accounting purposes into debt and equity components of $411.2 million and $163.8 million, respectively, based on the terms of the notes and the relative fair value at the issuance date. The adoption of ASU 2020-06 effective January 1, 2022 resulted in a pre-tax adjustment of $27.5 million to eliminate the remaining unamortized debt discount. ​ 2018 Revolving Credit Facility ​ In October 2018, Nabors Delaware and Nabors Drilling Canada Limited (“Nabors Canada” and together with Nabors Delaware, the “Borrowers”) entered into a credit agreement dated October 11, 2018 by and among the Borrowers, the guarantors identified therein, HSBC Bank Canada, as the Canadian lender, the issuing banks and other lenders party thereto (the “U.S. Lenders”) and Citibank, N.A., as administrative agent solely for the U.S. Lenders (as amended, restated, supplemented or otherwise modified from time to time, the “2018 Revolving Credit Facility”). On January 21, 2022, we repaid all amounts outstanding under the 2018 Revolving Credit Facility and the 2018 Revolving Credit Facility was terminated. ​ 2022 Credit Agreement ​ On January 21, 2022, Nabors Delaware entered into a revolving credit agreement between Nabors Delaware, the guarantors from time to time party thereto, the issuing banks (the “Issuing Banks”) and other lenders party thereto (the “Lenders”) and Citibank, N.A., as administrative agent (the “2022 Credit Agreement”). Under the 2022 Credit Agreement, the Lenders have committed to provide to Nabors Delaware up to an aggregate principal amount at any time outstanding not in excess of $350.0 million (with an accordion feature for an additional $100.0 million, subject to lender approval) under a secured revolving credit facility, including sub-facilities provided by certain of the Lenders for letters of credit in an aggregate principal amount at any time outstanding not in excess of $100.0 million. ​ The 2022 Credit Agreement permits the incurrence of additional indebtedness secured by liens, which may include liens on the collateral securing the facility, in an amount up to $150.0 million as well as a grower basket for term loans in an amount not to exceed $100.0 million secured by liens not on the collateral. The Company is required to maintain an interest coverage ratio (EBITDA/interest expense), which increases on a quarterly basis, and a minimum guarantor value, requiring the guarantors (other than the Company) and their subsidiaries to own at least 90% of the consolidated property, plant and equipment of the Company. The facility matures on the earlier of (a) January 21, 2026 and (b) (i) to the extent any principal amount of Nabors Delaware’s existing 5.1% senior notes due 2023 or 5.75% senior notes due 2025 remains outstanding on the date that is 90 days prior to the applicable maturity date for such indebtedness, then such 90th day or (ii) to the extent 50% or more of the outstanding (as of the closing date) aggregate principal amount of the 0.75% senior exchangeable notes due 2024 remains outstanding and not refinanced or defeased on the date that is 90 days prior to the maturity date for such indebtedness, then such 90th day. Additionally, the Company is subject to covenants, which are subject to certain exceptions and include, among others, (a) a covenant restricting our ability to incur liens (subject to the additional liens basket of up to $150.0 million), (b) a covenant restricting its ability to pay dividends or make other distributions with respect to its capital stock and to repurchase certain indebtedness and (c) a covenant restricting the ability of the Company’s subsidiaries to incur debt (subject to the grower basket of up to $100.0 million). The agreement also includes a collateral coverage requirement that the collateral rig fair value is to be no less than the collateral coverage threshold, as defined in the agreement. This requirement includes an independent appraisal report to be delivered every 6 months following the closing date. As of December 31, 2022, we had no borrowings outstanding under our 2022 Credit Agreement. The weighted average interest rate on borrowings under the 2022 Credit Agreement at December 31, 2022 was 5.05%. In order to make any future borrowings under the 2022 Credit Agreement, Nabors and certain of its wholly owned subsidiaries are subject to compliance with the conditions and covenants contained therein, including compliance with applicable financial ratios. ​ As of the date of this report, we were in compliance with all covenants under the 2022 Credit Agreement. We expect to remain in compliance with all covenants under the 2022 Credit Agreement during the twelve month period following the date of this report based on our current operational and financial projections. However, we can make no assurance of continued compliance if our current projections or material underlying assumptions prove to be incorrect. If we fail to comply with the covenants, the revolving credit commitment could be terminated, and any outstanding borrowings under the facility could be declared immediately due and payable. ​ Letters of Credit ​ We had 18 letter-of-credit facilities with various banks as of December 31, 2022. Availability and borrowings under our letter-of-credit facilities are as follows: ​
​ | ​ | ​ | ​ | ​
​ |  | December 31, |
​ | ​ | 2022 |
​ | ​ | (In thousands) |
Credit available | ​ | $ | 620,552 | ​
Less: Letters of credit outstanding, inclusive of financial and performance guarantees | ​ |  | 105,081 | ​
Remaining availability | ​ | $ | 515,471 | ​
​

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