Common Shares

12 Months Ended

Dec. 31, 2011

Common Shares [Abstract]

Common Shares

Note 14    Common Shares

Our authorized share capital consists of 800 million common shares, par value $.001 per share, and 25 million preferred shares, par value $.001 per share. Common shares issued were 317,042,324 and 315,034,436 at $.001 par value as of December 31, 2011 and 2010, respectively. No preferred shares have been issued. The preferred stock is issuable in one or more classes or series, full, limited or no voting rights, designations, preferences, special rights, qualifications, limitations and restrictions as may be determined by Nabors Industries Ltd.’s board.

From time to time, treasury shares may be reissued. When shares are reissued, we use the weighted-average-cost method for determining cost. The difference between the cost of the shares and the issuance price is added to or deducted from our capital in excess of par value account. No shares have been purchased during the years ended December 31, 2011, 2010 and 2009.

During 2011, 2010 and 2009 our outstanding shares increased by 82,138, 110,805 and 218,835, respectively, pursuant to a share settlement of stock options exercised by Mr. Petrello. As part of these transactions, Mr. Petrello surrendered unexercised vested stock options to the Company with a value of approximately $7.6 million, $24.5 million and $5.6 million, respectively, to satisfy the option exercise price and related income taxes for 2011, 2010 and 2009. During 2010 our outstanding shares also increased by 22,385, pursuant to a similar share settlement of stock options exercised by Mr. Isenberg. As part of these transactions, Mr. Isenberg surrendered unexercised vested stock options to the Company with a value of approximately $50.1 million to satisfy the option exercise price and related income taxes for 2010.

For the years ended December 31, 2011, 2010 and 2009 the Compensation Committee of our Board of Directors granted restricted stock awards to some of our executive officers, other key employees, and independent directors. We awarded 1,096,379, 538,496 and 85,000 restricted shares at an average market price of $27.32, $22.15 and $11.55 to these individuals for 2011, 2010 and 2009, respectively. See Note 8 — Share-Based Compensation for a summary of our restricted stock and option awards as of December 31, 2011.

For the years ended December 31, 2011, 2010 and 2009 our employees exercised vested options to acquire 1.1 million, .7 million and 1.5 million of our common shares, respectively, resulting in proceeds of $11.6 million, $8.2 million and $11.2 million, respectively.