UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): June 26, 2017
Weatherford International public limited company
(Exact name of registrant as specified in its charter)
Ireland | 001-36504 | 98-0606750 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
Weststrasse 1, 6340 Baar, Switzerland | CH 6340 |
(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: +41.22.816.1500
Not Applicable | ||||
(Former name or former address, if changed since last report) | ||||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Item 7.01 | Regulation FD Disclosure. |
On June 26, 2017, Weatherford International plc (the “Company”) announced that Weatherford International Ltd., a Bermuda exempted company and an indirect, wholly owned subsidiary of the Company (“Weatherford Bermuda”), launched a private offering of an additional $250 million aggregate principal amount of its 9.875% senior notes due 2024 (the “Senior Notes”) to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to certain non-U.S. persons in accordance with Regulation S under the Securities Act. The Senior Notes will be fully and unconditionally guaranteed by the Company and Weatherford International, LLC, a Delaware limited liability company and an indirect subsidiary of Weatherford Bermuda. A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
The information provided pursuant to this Item 7.01, including Exhibit 99.1, is “furnished” and shall not be deemed to be “filed” with the Securities and Exchange Commission or incorporated by reference in any filing under the Securities Exchange Act of 1934, as amended, or the Securities Act, except as shall be expressly set forth by specific reference in any such filings.
Item 8.01 | Other Items. |
In June 2017, the Company identified an immaterial error, with no cash flow impact, of approximately $28 million, net, related to the recognition of revenue with a customer, Petróleos de Venezuela, S.A. (“PDVSA”) in its previously reported 2016 Annual Report on Form 10-K and Quarterly Reports on Form 10-Q for the periods ended September 30, 2016 and March 31, 2017. The Company has concluded that beginning in the third quarter of 2016, the duration of time expected to collect revenue earned with PDVSA significantly exceeds the contractual payment terms and represents an implied financing arrangement. This has required the Company to recognize revenue at a discount reflecting the time value of money and accrete the discount as interest income over the expected collection period using the effective interest method.
This immaterial error resulted in the overstatement of both accounts receivable and revenue of approximately $22 million and $23 million, respectively, as of and for the year ended December 31, 2016 and $6 million and $8 million, respectively, as of and for the three-month period ended March 31, 2017.
In connection with this development, the Company will correct this immaterial error in its Quarterly Report on Form 10-Q for the three and six month periods ended June 30, 2017. The impact of the correction will decrease revenue and increase interest income by approximately $31 million and $3 million, respectively, for the three and six month periods ended June 30, 2017 and reduce accounts receivable by approximately $28 million as of June 30, 2017.
The impact of this error, had it been recorded in the prior periods described above, would have no impact on our previously reported compliance with financial covenants under our senior revolving and term loan credit facilities. There is also no impact to cash flow from operating activities or any other cash flow measures.
This Item 8.01 contains forward-looking statements. These forward-looking statements include, among other things, the Company’s expectations about future results and are also generally identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “outlook,” “intend,” “plan,” “guidance,” “may,” “should,” “could,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions, although not all forward-looking statements contain these identifying words. Such statements are based upon the current beliefs of the Company’s management, and are subject to significant risks, assumptions and uncertainties. Should one or more of these risks or uncertainties materialize, or underlying assumptions prove incorrect, actual results may vary materially from those indicated in our forward-looking statements. Readers are also cautioned that forward-looking statements are only predictions and may differ materially from actual future events or results.. Forward-looking statements are also affected by the risk factors described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, the Company’s Quarterly Reports on Form 10-Q, and those set forth from time-to-time in the Company’s other filings with the Securities and Exchange Commission (“SEC”). We undertake no obligation to correct or update any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required under federal securities laws.
Item 9.01 | Financial Statements and Exhibits. |
(d) | Exhibits. |
Exhibit Number | Description |
99.1 | Press release, dated June 26, 2017, related to the offering of Senior Notes. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Weatherford International plc | |
Date: June 26, 2017 | |
/s/ Christoph Bausch | |
Christoph Bausch | |
Executive Vice President and Chief Financial Officer | |
EXHIBIT INDEX
Exhibit Number | Description |
99.1 | Press release, dated June 26, 2017, related to the offering of Senior Notes. |
Exhibit 99.1
 | Press Release |
Weatherford Announces Private Offering of $250 Million of Senior Notes
Baar, Switzerland, June 26, 2017 - Weatherford International plc (NYSE: WFT) (the “Company” or “Weatherford”) announced today the launch of a private offering (the “Offering”) of an additional $250 million aggregate principal amount of its 9.875% senior notes due 2024 (the “New Notes”) to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to certain non-U.S. persons in accordance with Regulation S under the Securities Act. The New Notes will be senior, unsecured obligations of Weatherford International Ltd. (“Weatherford Bermuda”), a Bermuda exempted company and indirect, wholly owned subsidiary of the Company. The New Notes will be fully and unconditionally guaranteed, on a senior, unsecured basis, by the Company and by Weatherford International, LLC, a Delaware limited liability company and indirect subsidiary of Weatherford Bermuda.
The New Notes will be issued as additional securities under an indenture pursuant to which Weatherford Bermuda previously issued $540 million aggregate principal amount of its 9.875% senior notes due 2024 (the “Initial Notes”, and together with the New Notes, the “Notes”). The New Notes will have identical terms, other than the issue date, as the Initial Notes, and the New Notes and the Initial Notes will be treated as a single class of securities under the indenture governing the Notes.
The purpose of the Offering is to repay amounts outstanding under the Company’s revolving credit facility, give the Company additional liquidity throughout 2017, and provide assurance it will comply with the financial covenants set forth in its senior revolving and term loan credit facilities.
The New Notes will not be registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy the securities described above, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.
ABOUT WEATHERFORD INTERNATIONAL PLC
Weatherford is one of the largest multinational oilfield service companies providing innovative solutions, technology and services to the oil and gas industry. The Company operates in over 90 countries and has a network of approximately 880 locations, including manufacturing, service, research and development, and training facilities and employs approximately 29,500 people.
FORWARD-LOOKING STATEMENTS
This press release includes forward-looking statements, including those related to the Company’s anticipated compliance with the financial covenants in its revolving and term loan credit facilities after the Offering and the use of proceeds therefrom. These forward-looking statements are generally identified by the words “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “may,” “should,” “could,” “will,” “would,” and “will be,” and similar expressions, although not all forward-looking statements contain these identifying words. Such statements are subject to significant risks, assumptions and uncertainties. Known material factors that could cause the Company’s actual results to differ materially from the results contemplated by such forward-looking statements are described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, Quarterly Reports on Form 10-Q for the subsequent quarterly periods and those risk factors set forth from time-to-time in other filings with the SEC. Weatherford undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the extent required under federal securities laws.
Investor Contacts:
Christoph Bausch | +1.713.836.4615 |
Executive Vice President and Chief Financial Officer | |
Karen David-Green | +1.713.836.7430 |
Vice President – Investor Relations, Marketing and Communications | |
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