Borrowings and Other Obligations

3 Months Ended

Mar. 31, 2022

7 – Borrowings and Other Debt Obligations


(Dollars in millions)	March 31, 2022		December 31, 2021




Finance Leases Current Portion	$	13	$	12


Short-term Borrowings and Current Portion of Finance Leases	$	13	$	12

11.00% Exit Notes due 2024	$	300	$	300
6.50% Senior Secured Notes due 2028	489		488
8.625% Senior Notes due 2030	1,584		1,584
Finance Leases Long-term Portion	43		44
Long-term Debt	$	2,416	$	2,416

Our Exit Notes, 2028 Senior Secured Notes and 2030 Senior Notes (described below) were issued by Weatherford Bermuda and guaranteed by Weatherford International plc and Weatherford Delaware and other subsidiary guarantors party thereto.

Exit Notes

On December 13, 2019, we issued 11.00% senior unsecured notes (“Exit Notes”) due in 2024 for an aggregate principal amount of $2.1 billion. Interest on the Exit Notes accrues at the rate of 11.00% per annum and is payable semiannually on June 1 and December 1 and commenced June 1, 2020.

On October 20, 2021, we redeemed $200 million of our Exit Notes. On October 27, 2021, we issued $1.6 billion of 2030 Senior Notes (defined below) and used the net proceeds and cash on hand to redeem $1.6 billion in principal amount of our Exit Notes at applicable prices. At March 31, 2022, the carrying value of $300 million represents the remaining unpaid principal.

2028 Senior Secured Notes

On September 30, 2021, we issued 6.50% Senior Secured Notes in aggregate principal amount of $500 million maturing September 15, 2028 (the “2028 Senior Secured Notes”). Interest accrues at the rate of 6.50% per annum and is payable semiannually on September 15 and March 15 of each year, commencing on March 15, 2022. Proceeds from this debt issuance were used to fully repay a senior secured note with an aggregate principal amount of $500 million with a stated interest rate of 8.75% per annum due 2024.

2030 Senior Notes

On October 27, 2021, we issued 8.625% Senior Notes in aggregate principal amount of $1.6 billion maturing April 30, 2030 (the “2030 Senior Notes”). Interest accrues at the rate of 8.625% per annum and is payable semiannually on June 1 and December 1 of each year, commencing on June 1, 2022. As described above under Exit Notes, proceeds from this debt issuance were used to redeem $1.6 billion of its principal.

LC Credit Agreement

We have a senior secured letter of credit agreement (the “LC Credit Agreement”) in an aggregate amount of $215 million maturing on May 29, 2024, which is used by the Company and certain of its subsidiaries for the issuance of bid and performance letters of credit.

At March 31, 2022, we had approximately $169 million in outstanding letters of credit under the LC Credit Agreement (“LC Credit Agreement letters of credit”) and availability of $46 million.

As of March 31, 2022, we had $382 million of letters of credit outstanding, consisting of the $169 million under the LC Credit Agreement and another $213 million under various uncommitted bi-lateral facilities (of which there was $212 million in cash collateral held and recorded in “Restricted Cash” on the Condensed Consolidated Balance Sheets). Our letters of credit under various uncommitted bi-lateral facilities increased “Restricted Cash” since December 31, 2021 due to a requirement from a new multi-year contract.

Accrued Interest

As of March 31, 2022 and December 31, 2021, we had accrued interest of approximately $71 million and $35 million, respectively in “Other Current Liabilities” primarily related to the Exit Notes, 2028 Senior Secured Notes and 2030 Senior Notes.

Fair Value of Short and Long-term Borrowings

The carrying value of our short-term borrowings approximates their fair value due to their short maturities. These short-term borrowings are classified as Level 2 in the fair value hierarchy.

The fair value of our long-term debt fluctuates with changes in applicable interest rates among other factors. Fair value will exceed carrying value when the current market interest rate is lower than the interest rate at which the debt was originally issued and will be less than the carrying value when the market rate is greater than the interest rate at which the debt was originally issued. The fair value of our long-term debt is classified as Level 2 in the fair value hierarchy and is established based on observable inputs in less active markets. The table below presents the fair value and carrying value of our long-term debt (excluding finance leases).


	March 31, 2022				December 31, 2021
(Dollars in millions)	Carrying Value		Fair Value		Carrying Value		Fair Value
11.00% Exit Notes due 2024	$	300	$	311	$	300	$	311
6.50% Senior Secured Notes due 2028	489		516		488		528
8.625% Senior Notes due 2030	1,584		1,628		1,584		1,660
Long-Term Debt (excluding Finance Leases)	$	2,373	$	2,455	$	2,372	$	2,499