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Item 5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
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As previously disclosed, on December 13,
2019, the Company emerged from Chapter 11 bankruptcy protection pursuant to a prepackaged plan of reorganization (the “Plan”).
Following such emergence, the Board, in conjunction with its Compensation Committee (the “Committee”) and its independent
compensation consultants, has been reviewing and evaluating the Company's compensation policies and practices, including in response
to the global COVID-19 pandemic and the sudden drop in oil and gas prices in March 2020. As a result, the Board, upon recommendation
of the Committee, has approved the items described below in this Item 5.02.
Weatherford International plc Amended and Restated 2019
Equity Incentive Plan
As previously disclosed and as
contemplated by the Plan, in December 2019, the Board approved the Company's 2019 Equity Incentive Plan, which provided for
the issuance from time to time, as approved by the Committee or the Board, as applicable, of equity and equity-based awards
permitting for the issuance of up to 4,000,000 ordinary shares of the Company in the aggregate to eligible employees,
consultants and directors of the Company. On April 13, 2020, the Board adopted the Weatherford International plc Amended and
Restated 2019 Equity Incentive Plan (the “EIP”) which revised the Company’s 2019 Equity Incentive Plan. The
EIP continues to provide for the issuance of up to 4,000,000 ordinary shares and was amended, among other items, as
follows:
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The provisions addressing consequences on awards upon a change in control were modified to provide additional flexibility to the Company in the treatment of existing awards following a change in control (including that the EIP does not provide for any automatic acceleration of vesting on a change in control).
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The provisions addressing share appreciation rights were modified to provide additional detail regarding the terms of such grants.
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Some default definitions and related provisions were added including cause, confidential information, and detrimental activity.
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The foregoing description of the EIP does
not purport to be complete and is qualified in its entirety by reference to the full text of the EIP, which is attached hereto
as Exhibit 10.1 and is incorporated by reference herein.
Executive Non-Equity Incentive Compensation
Plan
On April 13, 2020, the Board adopted the
Executive Non-Equity Incentive Compensation Plan, as amended and restated (the “EICP”), effective January 1, 2020,
and reinstated the EICP for fiscal year 2020, which was suspended for fiscal year 2019. The EICP was amended to bring the plan
in line with market practices and address the treatment of awards on a change in control, among other things.
The foregoing description of the EICP,
does not purport to be complete and is qualified in its entirety by reference to the full text of the EICP, which is attached hereto
as Exhibit 10.2 and is incorporated by reference herein.
Reduced Non-Employee Director Compensation
On April 13, 2020, in response to the global
COVID-19 pandemic and the sudden drop in oil and gas prices in March 2020, the Company’s non-employee directors voluntarily
agreed to temporarily reduce their compensation in 2020. The annual cash retainer payments for non-employee directors will temporarily
be reduced by $5,000 a quarter, equal to $20,000 annualized, effective July 1, 2020. The annual equity retainer for non-employee
directors granted on April 13, 2020 (the “Grant Date”) in respect of the one-year period commencing on the Grant Date
(the “Annual Grant Period”) and the amount due in respect of the period served on the Board from December 13, 2019
through April 12, 2020, will be paid in cash, and the amount with respect to the Annual Grant Period will be subject to pro-rata
claw back in the event a non-employee director voluntarily resigns form the Board prior to the one-year anniversary of the Grant
Date.
Incentive Award to Chief Financial
Officer
As previously disclosed, on January 6,
2020, Christian A. Garcia was appointed to serve as the Company’s Executive Vice President and Chief Financial Officer and
the terms of his compensation were set forth in an offer letter he entered into with the Company. In connection with his appointment
and pursuant to the offer letter, Mr. Garcia was to receive, subject to approval of the Board, a long-term equity incentive award
of $2,000,000, consisting of restricted share units, vesting in equal installments over a three year period, to be granted on the
later of (i) January 6, 2020 or (ii) the date on which the Company emerged from Chapter 11 bankruptcy proceedings, based on the
share price at the time of grant and based on the terms of the Company’s then-current equity incentive plan.
On April 13, 2020, the Board approved a
grant of restricted stock unit awards under the EIP with respect to an award agreement for 68,966 ordinary shares, with a grant
date of April 17, 2020, which shall vest in three equal installments: on April 17, 2020 (subject to registration of ordinary shares
under the EIP); January 6, 2021; and January 6, 2022. The number of restricted stock units awarded is based on the closing price
of the Company’s ordinary shares on the trading day immediately prior to his commencement of employment, in accordance with
the offer letter.
The foregoing description of Mr. Garcia’s
Award Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of Mr. Garcia’s
Award Agreement, which is attached hereto as Exhibit 10.3 and is incorporated by reference herein.